BUILDING ON
OUR STRENGTHS
Annual Report
2023
CONTENTS
2
Our Highlights
4 What we do
37 Remuneration Report
58 Auditor’s Independence Declaration
6
8
12
Our Markets: The Industries We Serve
Chairperson and Managing Director Joint Report
59 Financial Report
117 Directors Declaration
Environmental, Social and Governance (ESG) Report
118
Independent Auditor’s Report
28 Board of Directors and Company Secretary
122 ASX Shareholder Information
30 Directors Report
124 Corporate Directory
REGIONS AND
NUMBER OF STAFF
67
CANADA
110
EUROPE
161
UNITED STATES
59
LATIN AMERICA
Front cover top
Ravi Chandra, NZ
Senior Director, Software Delivery
Front cover bottom
Dorthe J. Nielsen, Denmark
Senior Service Delivery Manager
Hansen Technologies Ltd
| Annual Report 2023
At Hansen, we relentlessly push boundaries, keeping our products
and offerings agile, innovative, and laser-focused on our customers’
needs and the ever-evolving sectors they thrive in.
253
NORDICS
156
UK
376
INDIA
11
SOUTH AFRICA
185
VIETNAM
184
AUSTRALIA
1
JAPAN
19
CHINA
44
NEW ZEALAND
Hansen Technologies Ltd
| Annual Report 2023
1
OUR HIGHLIGHTS
REVENUE
$311.8m
Up 5.2%
31.9%
Underlying EBITDA
Margin
$211.5m
Returned to our banks
and shareholders
since FY19
85%
Positive Employee
Engagement
2
Hansen Technologies Ltd
| Annual Report 2023
CUSTOMER DIVERSITY
(FY23 REV)
FY23 REVENUE
7%
6%
4%
3%
3%
2%
2%
2%
2%
2%
Customer 1
Customer 2
Customer 3
Customer 4
Customer 5
Customer 6
Customer 7
Customer 8
Customer 9
Customer 10
Other Customers
53%
67%
47%
Communications
Gas, Electricity and Water
Our revenue is 95% recurring and predictable and is well
diversified by region, vertical and customer
Hansen Technologies Ltd
| Annual Report 2023
3
WHAT WE DO
At the highest level, Hansen helps customers in the energy and
communications sectors deliver seamless customer experiences
as they navigate states of disruption and transition. We do this by
creating and delivering industry-specific software combined with
deep subject matter expertise that helps guide our customers
through their own market challenges.
At Hansen, we are part of the ecosystem that helps
deliver the foundation of our societies. The work
we do underpins the organisations that provide
the essential services of electricity, gas, water,
and communications. Although our customers,
the providers of these essential services, are
themselves in a transforming world where they can’t
sit still, it is vitally important that their core business
remains incredibly reliable, robust, and cost-effective.
While some of our solutions underpin the critical
bridge to the future, a considerable part of the
Hansen value is to provide the rock-solid foundation
that our customers rely on every day. For example,
providing current services, charging, and billing
for them, and engaging in the necessary customer
interactions required to maintain their business
and the critical services they deliver – all supported
through the Hansen Suite of software and services,
and the many Hansen employees that make
this possible.
At the core of the Hansen Mission and value
proposition is our ability to evolve our systems,
together with our customers, to remain relevant
continuously, and the bedrock of their operational
infrastructure. We deliver on that promise through
the following core pillars.
• Enabling customers to digitally transform their
business to support a variety of new telecom,
energy, and utilities-based services.
• Providing Modular, Cloud-Based Products for
the Cloud-driven Evolution.
• Delivering Engaging, Omni-Channel Experiences.
The Hansen Mission
Our Mission is to provide industry-specific software
products and expertise that enables our customers to
easily capitalise on the commercial opportunities of the
evolving energy, utilities, and communications markets.
We make this possible by providing highly reliable, mission-
critical software and specific industry expertise to help our
customers more easily innovate and sell new services and
market offerings, comply with changing market regulation,
and power new business models in areas such as emerging
sustainable energy supply, IoT, and new next-generation
connected services.
We aim to achieve this through long-term collaboration
with our customers and partners and through a global
workforce of skilled professionals that embrace challenges
and are committed to positive outcomes for our company,
employees, and the planet.
Derek Timbrell, UK
Lead Software Developer
4
Hansen Technologies Ltd
| Annual Report 2023
The Hansen Suite
The Hansen Suite is a core set of modular
software products and solutions that enable
our customers to capitalise on the commercial
opportunities of the evolving energy, utilities,
and communications markets.
HansenSuite
Communications, Technology & Media
Energy & Utilities
Product/Service/Resource
master data management
Installed product, service and
resource inventory management
Commercial off the shelf
customer care and billing
lifecycle management
Commercial product and
technical service catalog and
lifecycle management
Omni-channel quote and
order capture
Network service and
device activation
Metered AMI, calculations
and disseminating event
management
Cross-market omni-channel
quote and order capture
Commercial and technical
order über-orchestration and
fulfillment management
End-to-End
customer care billing
Automated energy trading,
optimisation and risk
management
Market messaging and market
transaction handling
Core Business Process Supported
Product innovation and
lifecycle management
CREATE
HANSEN Catalog
HANSEN Portfolio
HANSEN Trade
HANSEN MDM
DATA
FOUNDATION
Data Fusion
Enterprise Data Models
Deep Data Insights
ENGAGE
HANSEN CCB
HANSEN CIS
HANSEN Market-Message
DELIVER
HANSEN CPQ
HANSEN OM
HANSEN Provision
Rate-Bill-Care
Operational optimisation
Usage data analytics
Omni-Channel
Commerce Fulfillment
5
Hansen Technologies Ltd | Annual Report 2023 OUR MARKETS: THE INDUSTRIES WE SERVE
At Hansen we play a pivotal role for our customers.
We are an essential ingredient in their commercial
business model, providing the ability to create and
deliver essential services.
THE COMMUNICATIONS & MEDIA SECTOR
A$147.1m
REVENUE
Through FY23, the communications industry continued
to experience a convergence of factors that is almost
unprecedented. Digital transformation’s complexity,
the need for more agile infrastructure, the demand for
more vertical-specific solutions, and a greater emphasis
on the customer experience than ever before are among
these elements.
Within the communications industry, 5G and Internet of Things
(IoT) represents the next new frontier for Hansen’s customers.
Beyond basic enhancements in connectivity and performance,
5G represents relatively unchartered territory and will create
opportunities for our customers to capitalise on new business
models and resulting revenue streams.
Yet while many of our customers are paving the way for
this next frontier, through FY23, our customers continued
to choose Hansen to help them to navigate a myriad of
sector-specific challenges and opportunities including:
1. Complex enterprise B2B ordering and fulfilment;
2. The sell and fulfilment of complex bundling, increasingly
where third parties are involved; and
3. Supporting them in how to deliver an improved customer
experience through more seamless engagement.
Hansen is also working with a range of customers to
help reimagine their legacy infrastructure and become
TMF compliant.
6
Hansen Technologies Ltd
| Annual Report 2023
THE ENERGY & UTILITIES SECTOR
A$164.7m
REVENUE
The energy and utilities sector continues to experience
rapid transformation. Through FY23, the move to
renewables and self-generated energy accelerated
the changes that have been emerging to the traditional
commercial model for service providers.
Hansen customers are no longer in the era of supplying just
basic commodity services, and instead, they are providing new
energy and communications services and related experiences.
There is also an increased convergence between
Communications and Energy Industries. This convergence is
driving the integration of communication technologies within
the traditional energy infrastructure and in many respects
is essential for optimising the generation, distribution, and
consumption of energy. This has led to the emergence of
new business models and revenue streams, with smart grid
technologies and renewable energy sources the primary
drivers. The benefits of this convergence include greater
efficiency, reliability and sustainability in the production
and distribution of energy.
At Hansen, through FY23 we continued to see regional
differences in the energy sector play out; yet globally there
remains a strong focus on turning to Hansen to navigate
complex compliance requirements. In the Nordic region,
our CIS, MDM and Trade modules continue to attract new
logos and renewals and geographic expansion with existing
customers; in the Americas, many of our current customers
have recognised the benefits that come with the latest version
of our CIS offering and have committed to and pursued
upgrades; and in the APAC region strong renewals and
expansions for both our CIS and MDM products continue,
alongside projects to accommodate new market regulations.
Hansen Technologies Ltd
| Annual Report 2023
7
CHAIRPERSON AND MANAGING DIRECTOR JOINT REPORT
David Trude
Chairman
Andrew Hansen
Managing Director
Net Debt
Zero
70.8% of borrowings
repaid since 2019
47.3%
FY23 NPAT returned
to shareholders
8
We are pleased to present the annual
report for Hansen Technologies
Limited, for the fiscal year ended
30 June 2023 (FY23).
The 2023 financial year has been an outstanding year for
Hansen delivering strong organic revenue growth and EBITDA
margins above our market guidance and paying down debt to
achieve an effective net debt zero position at the end of the year.
A result like this is testament to our people; they are critical in
Hansen delivering on our mission to provide industry-specific
software products and expertise that enable our customers
to capitalise on the commercial opportunities of the evolving
energy, utilities, and communications markets. Their hard work
and dedication are reflected in what has been a stellar year
of product development, innovation, and financial growth.
Leadership Changes
Up until June 2023, Andrew Hansen held the positions of both
Chief Executive Officer and Managing Director. This meant his
leadership and focus spanned both the operational leadership
and the strategic direction of the company.
As a company of more than 1,600 people coupled with a rich
and buoyant acquisition history, Hansen announced a long-
planned decoupling of the roles and appointed long-term
Hansen executive Graeme Taylor to the position of CEO with
Andrew Hansen as Managing Director, focused on leading
strategic growth including inorganic M&A.
Investment for Growth
With a more than 50-year history behind us, we continue to
enjoy a strong track record in profitability, underpinned by a
strong suite of products and a relentless focus on the mission-
critical needs that our customers seek to address through our
offerings. This is a well-diversified business across all the key
markers of verticals, geography, and customers. During this
fiscal year, the Hansen team has continued to invest for growth
– to support both our customers as they improve and expand
their systems, and to ensure our team and operations
are primed for our next phase of growth.
Hansen Technologies Ltd | Annual Report 2023 A $46.7m
FY23 Free Cash Flow
5.2%
Revenue Growth
~95% Recurring and
Predictable Revenue
FY23 Revenue
Growth achieved
across all regions
FY23 saw Hansen invest a record amount in software
development, with a focus on enhanced cloud offerings
and security. Hansen’s approach of consistently putting our
customers at the centre of our thinking enables us to anticipate
and power their journeys into the future.
Our investment in R&D has supported the retention and
expansion of our customer base and has strengthened our suite
of products. We have never been better positioned to continue
our momentum of organic growth, and to supplement that
growth with carefully selected acquisitions.
As we explore acquisition opportunities, we are predominantly
targeting businesses within the communications and energy
industries, with a focus on companies that are driving profitable
innovation and growth. We see the most potential for growth in
North America and Europe.
Our pipeline of potential acquisition opportunities is robust,
with a mix of companies that have already been identified as
potential targets, as well as those that we continue to evaluate.
When assessing a target our focus is on robust and mission
critical companies:
• That have ownership of the IP.
• That provide opportunities for regional expansion or leverage.
• Have complementary applications.
• Or provide potential other verticals, while leveraging
our core skills.
Any acquisition target in a new vertical must be supported by
a strong pipeline of future acquisition opportunities in the same
vertical to ensure we can continue to inorganically grow and
develop the asset.
To support the increased demand for Hansen and our software,
we have been actively recruiting and benefiting from the
availability of high-quality candidates in the market.
Our investment in our people and our products has supported
our outstanding cash-generative results. We continue to pay
dividends to our shareholders and rapidly pay down debt.
Hansen’s very strong cash position provides significant
headroom to fund future strategic acquisitions to accelerate
the growth of an already strong business.
Reflecting our strong cash position, the Board has declared
a partially franked final dividend of 5.0 cents per share (cps).
This, combined with the interim FY23 5.0cps share dividend,
represents a 47.3% payout ratio of our FY23 NPAT.
During FY23, Hansen undertook a robust review of its
compensation models for Directors, Executives and Key
Management Personnel (KMP). We have revised our FY24
compensation models to be consistent with models of similarly
situated ASX-listed companies.
Our realigned LTI scheme will ensure that our goals and
objectives remain consistent with our commitment to
responsible cost management and sustainable growth,
to drive further value for our shareholders.
We are evaluating each opportunity with the same successful
approach deployed for more than twenty years.
Hansen is also considering a third vertical that complements or
leverages our existing capabilities. Our investment strategy for
a potential third vertical is to identify companies that are driving
profitable innovation and growth, are mission critical to the
companies they serve and are not easily replicated or replaced.
Awards and Industry Recognition
During FY23, our products and our people continued to be
recognised for the outstanding quality of work delivered by
customers as well as industry analysts and associations.
We are pleased to announce that in the past 12 months alone,
Hansen has been included in no less than eight technology
analyst reports or guides.
9
Hansen Technologies Ltd | Annual Report 202344%Application FeesLicence, Support and Maintenance56%AMERICASAPACEMEA18%23%59% CHAIRPERSON AND MANAGING DIRECTOR JOINT REPORT CONTINUED
In acknowledgement of the innovation and applicability of
our energy and utilities product suite, in January 2023, global
analyst firm Frost & Sullivan recognised Hansen with the Product
Leadership Award for Global Customer Care and Engagement
in the Energy and Utilities Industry, as part of their Best Practices
Awards program. Other notable recognitions during this
preceding year include inclusions in two Market Guides from
Gartner, one of the world’s foremost analyst firms – one for the
communications industry, and the other for the energy & utilities
industry. These Gartner Market Guides are a definitive overview
of the leading vendors specialising in a particular industry niche.
In October 2022, Hansen was awarded Outstanding Catalyst
for Business Impact during the TM Forum Digital Transformation
World, along with other Catalyst collaborators including
Cognizant, Amazon Web Services (AWS) and Verizon.
TM Forum’s Catalyst program is a proof-of-concept showcase,
comprising innovative projects developed and co-created
collaboratively by TM Forum members, to address important
industry challenges.
New Logo Wins and Upgrades
With the acceleration of change in our core markets of energy
and communications, whether it’s the transition to renewable
energy sources, or rollout of 5G networks, we are seeing
increased demand in our software and supporting services.
We recognise that we have a unique opportunity to increase
our brand awareness and expand our sales capabilities in
both existing and new markets. Through FY23 and into FY24,
additional investment will be made in enhancing our sales
and marketing efforts.
During FY23, we have secured several new logos and upgrades
and renewals with existing customers.
In May 2023 Hansen signed a new five-year contract with BKW,
an international energy company headquartered in Switzerland.
Hansen MDM (Meter Data Management) will be deployed via
a Software as a Service (SaaS) model across BKW’s meter
network in Switzerland. This multi-year agreement follows
Hansen’s recent success in Switzerland, having extended our
contract with existing customer Swissgrid, the national grid
company of Switzerland, in May 2022.
The expansion of Hansen’s footprint in the DACH region, which
includes, Germany, Austria, and Switzerland, follows Hansen’s
expanding presence in the Nordic region.
In July 2022, we announced an expansion of our partnership
with Energy Queensland Limited (EQL). The agreement builds
on the existing long-term relationship between Hansen and EQL
and is for an initial term of five years – with associated revenue of
approximately AUD$45m.
ESG
Hansen is committed to continual improvement in our approach
to managing our environmental footprint, social standing, and
our governance framework (ESG).
In late FY23, we appointed a resource dedicated to
championing our ESG efforts and established a cross functional
working group to facilitate and support our ESG approach.
We have undertaken an assessment of our material ESG topics
and defined a roadmap that will guide our efforts.
More details can be found in our Environmental, Social and
Governance (ESG) Report on page 12.
Financials
The Group’s financial performance this year has been
outstanding, delivering strong organic revenue growth and
a solid EBITDA Margin in a tough inflationary environment.
A$ Million
Operating revenue
Underlying EBITDA(1), (2), (4)
NPAT
Underlying NPAT(4)
Underlying NPATA(1), (3), (4)
Basic earnings per share
(EPS) (cents)
Basic EPS based on
underlying NPATA
(EPSa) (cents)(1)
FY23
311.8
99.5
42.8
41.5
55.6
Variance
(%)
5.2%
(0.8%)
2.1%
(1.7%)
(4.5%)
FY22
296.5
100.3
41.9
42.2
58.2
21.1
20.9
1.0%
27.5
29.0
(5.2%)
(1) The Directors believe the information additional to IFRS measures included in the report is
relevant and useful in measuring the financial performance of the Group. These include:
EBITDA, NPATA and EPSa.
(2) EBITDA is a non-IFRS term, defined as earnings before interest, tax, depreciation and
amortisation, and excluding net foreign exchange gains (losses).
(3) NPATA is a non-IFRS term, defined as net profit after tax, excluding tax-effected
amortisation of acquired intangibles.
(4) Underlying EBITDA, underlying NPAT and underlying NPATA exclude separately disclosed
items, which represent the one-off costs during the period. Further details of the separately
disclosed items are outlined in Note 4 to the Financial Report.
10
Hansen Technologies Ltd | Annual Report 2023 We are delighted to share that our operating revenue for FY23
of $311.8m exceeded our FY23 guidance.
Revenue ($m)
This outstanding result is supported by our ~95% recurring and
predictable revenue and a very low customer attrition rate of
less than 2%, with no one customer making up more than 7%
of our total global revenue. This diversity, and the industries we
service, ensure that we remain resilient and create opportunities
to leverage our global footprint.
The underlying FY23 EBITDA margin was 31.9%. Underlying
EBITDA has grown 12.1% since FY19 on a compound annual
growth rate (CAGR) basis.
Hansen continues to demonstrate its stability as a consistently
cash-generative organisation with FY23 free cash flow
of $46.7m.
During FY23, Hansen further paid down an impressive
$33.6m of its borrowings. Since FY19, the Company has
paid down $131.5m or 70.8% of Borrowings. At the end of
FY23, Net Debt was effectively zero.
It’s been a great 12 months for Hansen. Our focus on delivering
outstanding, profitable organic growth is paying off and we have
been developing a robust pipeline of acquisition opportunities.
We look forward to an even stronger and more exciting FY24.
David Trude
Chairman
Andrew Hansen
Managing Director
7 . 8 %
C A G R :
21.0
286.7
296.5
311.8
301.4
231.3
FY19
FY20
FY21
FY22
FY23
Underlying EBITDA1 ($m)
1 2 . 1 %
C A G R :
99.2
100.3
99.5
85.7
63.1
FY19
FY20
FY21
FY22
FY23
1. EBITDA is a non-IFRS term that relates to earnings before interest, tax,
depreciation, and amortisation and excluding net foreign exchange gains/
(losses). AASB 16 Leases (AASB 16) has been applied to FY17 to FY19
to reflect an estimated impact of the adoption of this standard. AASB 16
has been adopted by the Group in FY20. Non-recurring items have been
excluded from each year, where applicable.
Note: FY21 operating revenue and FY21 underlying EBITDA include the impact
to revenue and reported EBITDA of a one-off licence revenue of $21m.
11
Hansen Technologies Ltd | Annual Report 202321.0 ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) REPORT
Hansen is a global business, and we believe it is critical to always
operate sustainably and ethically. For us, sustainability spans not just
our environmental footprint and impact, but also how we operate and
how we support our people, our customers, and our communities.
We are committed to making reliable and meaningful contributions to
the communities we operate in. All of this is underpinned by our strong
governance framework.
Managing Director’s Message
We are a global provider of software and services to the energy,
water, and communications industries. Our award-winning
software suite, helps our customers in more than 80 countries
to create and deliver new products and services, engage with
their customers, and control and manage critical revenue and
customer support processes.
In FY22, Hansen started on our journey to become carbon
neutral, initially focusing on our Australian operations where the
company is headquartered. We invested in a renewable energy
project in India, and our Australian operations were certified as
carbon neutral by Climate Active.
In FY23 we have again offset 100% of our Australian operations
Green House Gas (GHG) emissions. Our intention is to measure
GHG emissions across the Hansen global operations in the next
few years as we seek to expand our carbon neutral status
globally over time.
More and more we are seeing Hansen’s products and services
being used by our customers for alternative energy systems
such as residential solar, community solar, microgrids and
electric vehicles. We see this as a potential vehicle for positive
environmental impact and will be exploring how to best measure
the positive impact of our offerings in the coming years.
Our structure allows us to build and develop strong customer
relationships, deep market knowledge and be more focused
and responsive to our customer’s needs.
Since we delivered our inaugural ESG report in FY22 we
have made significant improvements in our ESG approach.
During FY23, with the support of independent experts we
commenced an assessment of our material ESG topics and
developed our inaugural ESG roadmap. We will evolve our
ESG roadmap over time to ensure it delivers benefits for the
environment, our customers, our people, and the communities
we operate in.
In this FY23 ESG Report we focus on our customers, partners,
people, communities, and the environment. At Hansen we take
ethical operations and Governance very seriously and we have
outlined our key governance policies separately on our website.
We are delighted to share our second annual ESG report to
our stakeholders, and we invite you to join us on our journey.
OUR STRUCTURE ALLOWS US
TO BUILD AND DEVELOP STRONG
CUSTOMER RELATIONSHIPS
12
Hansen Technologies Ltd
| Annual Report 2023
FY23 Highlights
ENVIRONMENTAL HIGHLIGHTS
• Offset 100% of our Australian Operations GHG emissions.
• Australian electricity emissions reduced 12.6%.
• Australian Data Centres moving to more efficient (+90% renewable energy achieved globally)
and scalable centres.
• Established new more modern and energy efficient offices in Australia, Norway,
Canada, and India.
SOCIAL HIGHLIGHTS
• Developing an improved and expanded Parental Leave Policy.
• Introduced Domestic Violence Leave in Australia.
• Continued to support our people with our profit share program.
• Embedded as an annual program our ‘Acts of Impact’ initiative which supports the
communities we operate in.
GOVERNANCE HIGHLIGHTS
• Assessed and defined material ESG topics.
• Developed our initial ESG roadmap.
• Enhanced our mandatory security training
and information security controls.
• Reviewed our internal governance polices
for areas of improvement, including making
them clearer and translated more of them
into the native languages of the countries
in which we operate.
• Developed and piloted a Supplier Code
of Conduct to be circulated to our
suppliers during FY24.
• Updated our Audit and Risk Charter
to include ESG as key risks.
• Established a cross functional ESG working
group to focus on ESG related matters.
Hansen Technologies Ltd
| Annual Report 2023
13
ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) REPORT CONTINUED
Materiality Assessment
During late FY23 we undertook a materiality assessment
of our ESG topics. We consulted our stakeholders to
understand their opinion on the role Hansen should play
in a range of ESG topics.
Our approach to materiality considers double materiality,
whereby each material topic is assessed from the
perspective of stakeholders (‘impact materiality’) and
the business (‘financial materiality’). This approach
broadly aligns with the focus of materiality in both
Global Reporting Initiative (GRI) (impact materiality)
and International Sustainability Standards Board (ISSB)
(financial materiality).
A longlist of actual and potential material topics
was initially developed based on document review,
market trends, peer review and sustainability reporting
standards. Insights from this review informed the impact
of each topic on Hansen’s stakeholders.
20 material ESG topics were categorised into strategic
groupings, to present and consider how they may be
addressed as part of Hansen’s future ESG strategy.
Workshops informed how each material topic impacts
Hansen as a business. A materiality matrix was
developed to visualise these outputs. Hansen’s initial
areas of focus are on the topics identified as strategic.
Hansen’s ESG report is broadly structured around these
20 Material topics identified. During FY25 we aim to begin
a global stakeholder engagement exercise as part of a
materiality assessment refresh.
Materiality Matrix
Compliance
Core
Strategic
(G) Data privacy
& cyber security
(S) Diversity, inclusion
& equality
(E) Innovative & sustainable
solutions (incl. digital
accessibility)
(E) Renewable energy
development & transition
(G) Responsible & ethical
(S) Future career pathways
(S) Employee experience
procurement
& wellbeing
(E) Service adaptability
& reliability
(G) Business ethics
(incl. anti-bribery
and corruption)
(S) Community
development
(E) GHG emissions
(E) Climate risk & resilience
(G) Leadership, governance
& transparency
(G) Regulatory compliance
(G) Human rights
(S) Health & safety
(G) Modern Slavery
(G) Anti-competitive
behaviour
(S) Financial wellbeing
(E) Circularity & eWaste
Financial materiality ‘outside in’ = impact on Hansen’s financial objectives, business targets, purpose and values
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Hansen Technologies Ltd | Annual Report 2023
FY23
Completed
• Established a cross functional
ESG working group
• Engaged an independent third party
to commence the development of an
ESG Strategy by conducting an
ESG materiality assessment
• Developed inaugural ESG Roadmap
• Piloted Supplier Code of Conduct
ESG Roadmap
Our roadmap is intended to guide and support Hansen
in achieving greater value for our stakeholders and the
communities we operate in.
Informed by the materiality assessment, insights on gaps
and opportunities for improvement gained from multiple
assessments and reviews resulted in the identification of key
action areas, which have been used to develop Hansen’s ESG
roadmap. These actions will, over time, enable Hansen to
develop a comprehensive ESG Strategy, uplift its reporting and
disclose ESG impacts and performance in line with reporting
sustainability frameworks over the next few years.
Hansen’s goal is to ensure it acts on our most important and
effective measures, seizing real and meaningful opportunities
to improve our ESG standing globally.
FY24
Following is a summary of Hansen’s ESG roadmap activities
including completed activities during FY23.
• Develop a whole-of-business ESG Strategy
• Develop ESG targets and identify relevant
ESG data points to begin tracking
• Begin development of a Diversity, Equity
& Inclusion Strategy
• Formalise a waste management plan that
builds on current waste management efforts
• Review and update selected policies
in line with the ESG Strategy
• Launch Supplier Code of Conduct
• Calculate detailed scope 3 emissions
for Hansen’s Australian operations
• Recertify for ClimateActive
ACT OF IMPACT
AMBURY REGIONAL PARK PLANTING DAY
Our Hansen crew and their families in Auckland
(New Zealand) joined the wider community to plant
more than 1,000 native trees, shrubs, and grasses
at Ambury Regional Park. The team also planted
two Metrosideros (NZ Christmas Tree) (known as
Pohutukawa to Māori) in memory of friend and
colleague Bruce Turton, who passed away earlier
in the year.
The Park, located 15 kilometres south of Auckland
city on the shore of Manukau Harbour, is a working
farm, making it a great park for families. It is also
home to more than 86 bird species including
knots, godwits, wrybills, little shags, and
white-faced herons.
Other Acts of Impact where we helped re-green
or clean up parks and reserve areas took place in
Australia, Argentina, India, Finland, and Sweden.
FY25
& Beyond
• Undertake a global stakeholder
engagement exercise as part of a
materiality assessment refresh
• Conduct global sustainability risk
and opportunity assessment to refine
ESG Strategy
• Calculate scope 1, 2 and 3 emissions
for Hansen’s global operations
• Develop an emissions reduction strategy
and submit targets to SBTi
• Recertify for ClimateActive
•
In line with expected mandatory climate
reporting requirements, begin preparations
to develop an inaugural climate report
aligned to TCFD/ISSB S2
Over the next two years, guided by our roadmap,
Hansen aims to develop a whole-of-business ESG
strategy. We will communicate a list of key ESG
metrics and targets and begin to track and share our
progress over time.
We aim to publish our whole of business ESG strategy
during FY24/25. Beginning in FY25 we will start to
assess our global sustainability risk and opportunity
assessment to refine our ESG Strategy.
15
Hansen Technologies Ltd | Annual Report 2023 ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) REPORT CONTINUED
Environment
Hansen is taking a proactive approach towards reducing
our environmental footprint across all our operations,
products, and services, including through reducing
emissions and conserving resources and creating
expectations for our suppliers.
Innovative and sustainable solutions
(incl. digital accessibility)
The nature of the sectors we support means we are always
looking ahead at how our work can support a more sustainable
operation and future for our customers and their customers.
Our energy customers are increasingly transitioning away
from carbon intensive energy. We aim to support their journeys
and enable them to provide and bill for increasingly complex
solutions that can include a mix of emerging power including
solar, community solar, micro grids and EV charging and other
energy efficiency initiatives.
Giving energy, utility and communication service providers
access to innovative digital solutions that meet their needs
and are designed with limited environmental/social impacts,
helps Hansen attract and retain customers.
CASE STUDY
ACHIEVING A NEW LEVEL OF SERVICE ADAPTABILITY
Advances in electric vehicles (EVs) and charging
solutions raise exciting prospects for integrating
charging infrastructure to enable smart charging and
vehicle-to-grid (V2G) applications. They are a key
driver for infrastructure evolution and the progression
of interconnectivity to smart grids, development of
smart cities and towns around the world, and the
smart electrification of our everyday connected lives.
Wanting to get ahead of the game by moving early
on services for the EV market was a key initiative for
one of the largest Nordic retailers. The company was
eager to streamline business processes to increase
operational efficiencies, accelerate the digital
transformation process and reduce time-to-market
for new products and services. The overarching aim
was to engage both customers and society to join the
change for a cleaner world.
Hansen was consulted to provide expanded
coverage on this front. In close collaboration, we
started by putting in place a CIS system for the
Norwegian market before gradually expanding the
partnership to encompass Finland and Sweden.
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Hansen Technologies Ltd
| Annual Report 2023
Renewable energy development & transition /
Service adaptability & reliability
Digital technologies have been supporting and enabling energy
systems for decades – just as Hansen has been dedicated
to the energy market for many years. But now we are rapidly
moving from a system characterised by large, centralised
resources with one-way flows of energy and information,
to an advanced grid market with distributed, decentralised,
decarbonised resources with two-way flows of energy
and information.
Turning personalised energy experience into new business
opportunities is imperative for next-generation energy and
utility providers.
This transition to renewable electricity centres around new
Distributed Energy Resource Management products which
respond to and facilitate shifts in customer demand in their
journey to Net Zero carbon emissions.
The Hansen Suite for Energy and Utilities is designed to deliver
the next experience while enabling energy and utilities to grow
from new business models. Hansen’s combined offering
amounts to more than the sum of its parts.
Hansen is helping utilities and energy service providers meet
the challenges of the energy transition right now. The approach
and philosophy at play differ from region to region and company
to company but time and again it proves to be the case that
innovation in the introduction of new processes and enabling
agility are critical for success in the face of changing conditions.
In the coming years we plan to further explore and measure how
our products and services contribute to the financial wellbeing
and sustainable operations of our end-users.
GHG emissions
Continued Steps to Becoming Carbon Neutral
We are undertaking a phased approach to achieving carbon
neutrality. Commencing in FY22 we were certified carbon
neutral for our Australian operations by Climate Active.
Hansen aims to continue to recertify with Climate Active for our
Australian operations. During FY24 we will begin to survey our
Australian supply chain to calculate detailed scope 3 emissions
for our Australian operations. Beyond FY24 we will seek to
calculate and benchmark our global scope 1-3 emissions.
Once we have benchmarked our global emissions we intend to
develop and submit our global emissions reduction strategy
to the Science Based Targets initiative (SBTi).
Our net electricity emissions for Australia reduced significantly
(12.6%) compared to our previous climate active submission
as a result of our reduced electricity consumption from being
in more advanced energy efficient buildings and the lowering
of Victorian electricity emissions intensities.
The nature of our industry is that we have a low emissions
footprint when compared to many other industries, but we
are always looking for ways to not just offset our emissions,
but also reduce or eliminate them through targeted activities
and decisions.
We recognise with the complexity of our global company that
this is not an overnight initiative, and that there are many facets
to influencing our carbon emissions and how to offset those
where we can’t eliminate them fully.
Reduction of GHG emissions arising from Hansen’s Australian
operations and solutions includes the migration of our
data centres to an outsourced provider, who has made a
commitment to become carbon neutral by 2030 globally.
Our provider currently obtains 95% renewable energy globally,
81% in the centres Hansen utilises across Australia, Finland,
and the United Kingdom. This results in reduced GHG
emissions for Hansen and our customers.
Australian Operations Certified Carbon Neutral
Australian
Emissions
(FY22 tCO2-e)
4,406.9
100%
OFFSET
972.8
163.7
Scope 1
Scope 2
Scope 3
Scope 1 emissions covers emissions from sources that Hansen owns or controls directly.
Scope 2 emissions are emissions that Hansen causes indirectly and come from where
the energy it purchases and uses is produced. For example, the emissions caused when
generating the electricity that we use in our buildings fall into this category.
Scope 3 emissions encompasses emissions that are not produced by Hansen itself but by
those that Hansen is indirectly responsible for in its value chain. Scope 3 emissions include all
sources not within the scope 1 and 2 boundaries.
We have offset 100% of our FY22 Australian GHG emissions
via a Renewable Power Project by Devarahipparigi Wind Power
Private Limited in Karnataka, India.
The main purpose of this project activity is to generate a clean
form of electricity through renewable wind energy sources.
The project activity involves installation of a 100 MW wind
power project in Karnataka state of India. Over the 10 years of
the first crediting period, the project will replace anthropogenic
emissions of GHG’s estimated to be approximately 177,576
tCO2-e per year, thereon displacing 183,960 MWh/year amount
of electricity from the generation-mix of power plants connected
to the Indian grid, which is mainly dominated by thermal/fossil
fuel-based power plant.
Australian Emissions Reduction Strategy
Our target is to reduce the GHG emissions intensity of our
current and existing business operations in Australia by
50% from our FY22 intensity of 107.88 tCO2-e per million
dollars of revenue, by 2026, and to ensure a reduction in
the absolute emissions of our current and existing business
operations in Australia by no less than 40% by FY26 from
FY22 levels.
We aim to achieve this by:
• Replacing older Australian data centres with energy
efficient outsourced centres by the end of 2025.
• Working with outsourced data centre providers to source
renewable or offset power where possible.
• Transitioning our Australian offices and employees to
more energy efficient spaces by end of 2025.
• Reducing the number of flights taken and offsetting
a minimum of 50% of the carbon emissions of our
remaining flights by FY26.
• Delivering a supplier code of conduct in FY24 to establish
ESG expectations for our supplier network.
Australian Emissions Reduction Achievements
Hansen has already made great progress on its emission
reduction strategy during FY23.
• Took residence in a smaller energy efficient office location
in the Central Business District of Melbourne.
• Have made significant progress to migrate our data
centres to an external facility.
• Increased our embracing of a technology-first approach,
including improved video conferencing facilities,
to reduce our need for travel.
• Formalised our work from home policy as part of our
ongoing commitment to hybrid working and started
adapting our office environments to better reflect
reduced use of office space and support the reduction
in staff commuting.
OUR ENERGY CUSTOMERS ARE
INCREASINGLY TRANSITIONING AWAY
FROM CARBON INTENSIVE ENERGY.
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Hansen Technologies Ltd | Annual Report 2023 ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) REPORT CONTINUED
Evolving our Office Offerings
One of our learnings, through the pandemic, was alternative
ways to stay connected with both our co-workers and
our customers.
We continue to have a large portion of our employee base
working from home or at least coming into our offices on
a significantly less frequent basis.
We have continued to evaluate our physical office facilities
including reducing both the number of locations and/or their
respective footprint when determined appropriate.
In mid 2022 in Australia, we opened a small central
office which has reduced the travel times for many of our
head office staff. The new location is contained in a building
with the NABERs rating of 4 further reducing our
environmental footprint.
Through FY23 we have updated our office locations in Canada,
India, and Norway. These new spaces better reflect the needs
and aspirations of the hybrid worker of today and beyond.
Our buildings are modern, energy efficient and facilitate our
people to travel by public transport or their own energy to our
connection hubs.
As we assess our offices across the globe, we look at the
lighting, the heating and cooling options and what we can do
to reduce our overall impacts with recycling, energy choices of
building provider, encouraging our people to print as a last resort,
and much more. We ensure there are good end of trip facilities
for our people; and aim to align with local and international
certifications for environmental and healthy buildings.
Climate risk & resilience
Across FY24 and FY25 Hansen will begin preparations on
a climate report aligned to the Task Force on Climate-related
Financial Disclosures (TCFD) / ISSB.
Hansen aims to identify climate-related physical and transition
risks and opportunities to drive climate resilience for our own,
and our customers operations. This includes understanding
the impacts on our global supply chain disruptions due to
extreme weather events.
Environmental risks are recognised in Hansen’s Corporate
Governance Statement, and we have developed and piloted
our Supplier Code of Conduct to further address climate
related risks across our supply chain.
Over the next few years, we aim to disclose the actual and
potential impacts, climate-related risks and opportunities
have on our corporate strategy and how we intend to identify,
assess, and manage climate related risks.
Circularity & eWaste
Hansen is committed to the sustainable procurement and
consumption of electronics we use and their responsible
disposal at end-of-life. Hansen is continually exploring circular
business models that minimise waste, promote recycling and
reuse, and prioritise the use of renewable resources.
During FY24 Hansen will explore leveraging existing learning
resources to embed energy conservation/climate actions and
waste reduction in training programmes and seek to formalise
mandatory annual completion of all training. We aim to set
targets and KPIs, and track and report on completion rates
from FY25.
As part of our Acts Initiative, we have repurposed, sold,
and donated data-cleansed laptops, cables, and other
infrastructure in an effort to give back to our people and
communities and reduce our e-waste.
During 2023 we began decommissioning our older less efficient
data centres. This not only reduces our need for key electronic
infrastructure but also dramatically reduces our energy usage.
Commencing in 2024 we will begin to assess our suppliers and
our approach to e-waste management. We aim to formalise
a waste management plan that builds on current waste
management efforts. This will be centred around responsible
procurement, waste minimisation through repurposing and
donation and where it is not possible to repurpose, safe disposal.
IN MID 2022 IN AUSTRALIA WE OPENED
A SMALL CENTRAL OFFICE WHICH HAS
REDUCED THE TRAVEL TIMES FOR MANY
OF OUR HEAD OFFICE STAFF.
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| Annual Report 2023
Social
Hansen has always been an active member of, and strives
to make a positive impact in the communities we operate in.
Our commitment to these communities not only adds value
to our local communities but helps us attract and retain our
pool of highly talented people.
We strive to foster an environment of creative problem
solving, our involvement with the communities we operate
in encourages innovation and ensures we develop our
range of services and products that meet and exceed
our customers’ expectations.
Diversity, inclusion & equality, and
Future career pathways
Hansen supports all forms of diversity – including gender,
neurodiversity, alternative belief systems and ethnicity.
Diversity is embedded within the strategies, culture, policies,
and structures of Hansen’s workplaces. We believe that a
diverse and inclusive workplace is essential for our success.
Across FY24 and FY25 we will begin development of a Diversity,
Equity & Inclusion Strategy including determining appropriate
metrics and targets to enhance the Diversity and Inclusion
policy Hansen already has in place.
Ethnicity
Our more than 1,600 people are located across 18 countries
and are fluent in more than 60 languages. It is this level of
diversity that we believe is a competitive advantage and
an asset to our customers. It means we have local people
supporting local customers, our people translate effortlessly
across cultures and geographies, and our people can connect,
collaborate, and grow from continually engaging with global
colleagues and experts.
We work hard to bring our people together across our markets
and cultures. A core element of this is through storytelling
using our internal engagement platforms and external social
media. Our people share on their career journeys, how they
have overcome challenges and embraced opportunities, we
showcase hobbies, pastimes, and family life and help create
greater understanding and inclusion by sharing
cultural moments.
Gender
31%
Female
69%
Male
In March 2023 we celebrated International Women’s
Day taking the time to reflect on our progress in
supporting diversity in the technology industry
and made commitments to do even more.
Throughout the month, we hosted cross-market and
regional panel discussions, supporting local women in
business by purchasing morning and afternoon teas,
raising funds as part of our Acts of Impact initiative,
and recognising the incredible individuals who make our
community a welcoming and supportive place for all.
Hansen has undertaken an internal pay equity analysis
each year since FY20 and reports this annually to the
Workplace Gender Equality Agency (WGEA).
Hansen continues to seek and implement initiatives
to close the gender pay gap, a product of the
broader systemic underrepresentation of women
in technology roles.
Part of the challenge in our industry is increasing the
representation of women in technical and senior roles
and we are continually seeking ways to help grow and
diversify the pool of talent entering our Hansen team.
We are actively exploring ways of contributing to
widening the pipeline of women in STEM roles and
exploring ways of promoting the technology sector
more generally. We are also preparing an improved
parental leave policy to attract more female employees
and create a more gender balanced workforce.
As a business in the high-tech space, we are very
pleased to say that our gender ratio is 31% per cent
female and 69% per cent male.
Hansen Technologies Ltd
| Annual Report 2023
19
HANSEN GENDER RATIO ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) REPORT CONTINUED
73% OF OUR PEOPLE INDICATED
POSITIVE ENGAGEMENT,
85% INDICATED POSITIVE
INCLUSIVITY SENTIMENT AND
82% INDICATED POSITIVE
SENTIMENT AROUND WELLBEING.
In addition to our custom-developed trainings, which are often
product or technology-specific, such as our digital certifications
and badges, all our employees have access to the LinkedIn
Learning portal with more than 13,000 courses ranging from
IT and technology courses to professional skills and other
interest topics.
Our people have engaged in over 16,000 LinkedIn courses
across FY23. Globally our people have engaged in more the
240,000 hours of technical and compliance training during FY23.
Employee Experience & Wellbeing
At Hansen we strive to optimise the employee experience at all
stages of the employment lifecycle by fostering a strong culture,
through organisational values, and supporting employees with
benefits, such as equitable remuneration, opportunities for
development and mental health initiatives.
We embrace a range of tools to listen and seek input, including
our annual engagement survey and various pulse-check
surveys, which we run throughout the year.
We are pleased to report that our last survey represented
a very strong employee voice, with an 85% response rate
up from 82% last year. 73% of our people indicated positive
engagement (up from 70%), 85% indicated positive inclusivity
sentiment (up from 83%) and 82% indicated positive sentiment
around wellbeing (up from 80%).
We are very proud to report our engagement question with
the biggest improvement since last survey “Hansen is taking
action to be socially responsible” is up 16 basis points to 88%.
90% of our people stated they can be themselves at work
with 86% stating that everyone can succeed at Hansen no
matter who they are (e.g. all ages, cultural backgrounds,
gender, races, religions etc.)
Future Career Pathways
During FY23 we welcomed more than 50 graduates into our
fold in our centre of excellence in India.
This investment in new talent continues including expanding
our graduate program to include our other centres of excellence
in Vietnam and Argentina, internships and embracing new
pathways programs to the IT sector.
Providing our people not only with career paths, but also ongoing
development is critical to ensuring that they are aligned with the
business, and remain motivated and driven towards innovation.
This starts with our comprehensive onboarding program, where
we allow all our new team members time to immerse into our
business, meet our key leaders and get to know the Company
and its vision and values along with our products and solutions.
We are working with our people to ensure they have individual
goals and plans, which identify key learning initiatives to ensure
they keep developing professionally and personally. During FY24
and beyond we will be further exploring ways to optimise our
Employee Value Proposition and Employee Experience Strategy.
For all people, we have our annual mandatory training and
refreshers to ensure everyone remains compliant around data,
security, privacy, and our Company values.
ACT OF IMPACT
RECYCLING INITIATIVE BENEFITS ROYAL
CHILDREN’S HOSPITAL
Working in technology, we know the impact our hardware
can have on landfill. Laptops, desktops, mobile phones,
servers – we turn them over regularly and often when
they still have life in them.
To help avoid sending hardware with life still in it to
landfill, the Hansen IT Services team in Australia
conceived what they are terming a triple Act of Impact.
Our Australian team were offered the opportunity to
purchase laptops and desktops that would otherwise
have gone to landfill for a donation to the Royal
Children’s Hospital – a hospital that specialises in
the care of children across Melbourne and beyond.
The triple benefit – less e-waste in our environment,
a well-priced piece of technology for a family
member, and a sizable total monetary donation
to an incredible organisation.
Further E-Waste was saved from landfill and rehomed
in several other Acts across North America and the UK.
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Hansen Technologies Ltd
| Annual Report 2023
Our Company Values
The values – and there are only four – that we ascribe to are
very much the values that we live by. They come to life in our
behaviours, the way we engage with each other and the
mutual respect we show each other – every day.
At Hansen, we are like a global community. We bond around
shared values, we aim to ensure all our people feel valued as
human beings, and that everyone has a voice in decisions
that affect them.
This means we care about others. We are respectful and
treat others as we would like to be treated. And we genuinely
embrace our differences, knowing this only adds to the ability
to solve problems for our customers and be more innovative.
One United Team
Sharing knowledge and
leveraging our global experience.
An environment that encourages
innovation and facilitates
openness and transparency.
Treat it Like its Your Own
Make business decisions with
the same level of consideration
you would if you were making
them for yourself.
People and Family
Caring about others, being
respectful, treating others
like you want to be treated.
Genuinely embracing our
differences, like family.
Focused and Committed
Focused on understanding
the customer’s needs & being
passionate about delivery
an exceptional customer
experience.
Ravi Chandra, NZ
Senior Director, Software Delivery
Hansen Technologies Ltd
| Annual Report 2023
21
ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) REPORT CONTINUED
HANSEN SUPPORTS
FORESTS BY HEARTFULNESS
In India, companies that earn above a
certain threshold are mandated to invest
in CSR (Corporate Social Responsibility)
initiatives. India is currently the only country
in the world that requires this, and recently
Hansen made its first contribution.
Businesses can invest in areas such as
education, poverty, gender equality and
hunger as part of their CSR compliance.
There are so many worthy areas that Hansen
could invest in, but we chose Forests by
Heartfulness. This initiative aspires to
conserve rare, threatened, and endangered
species of tropical forests.
Our FY23 investment is supporting a
project in the Ratlam District of Madhya
Pradesh, located about halfway between
Mumbai and Dehli in the northern part of
India. The project is to green 105 acres
of public land to create a “City Forest”.
Employee Recognition
At Hansen we have several ways that we recognise and reward
our colleagues and teammates. All of these are powerful in
their own way.
Salute Success is one specific initiative at Hansen that allows
our people to recognise their teammates who have brought to
life our Hansen Values as they have gone about their day, on
specific work tasks, to build our culture and community spirit,
or to contribute to customer or project results and impact.
Profit Share
For some years now all our eligible Hansen employees have
been able to participate in our profit share plan. The plan is
designed to share the company’s profit with those who
have been part of the success. The Plan allows for the
distribution of a percentage of Net Profit after tax of
Hansen Technologies Limited.
Health and safety
Consideration of the physical health of employees which
includes embedding safety policies and procedures to minimise
accidents, maintain lower absence/sick leave rates and
optimise productivity is of paramount importance to Hansen.
We are always looking to enhance our approach and improve
the safety of our people while at work, either in the office or
when they work from home. Across FY24 and FY25 we will look
to enhance and translate more of Health and Safety policies
and procedures into the major languages spoken by employees
and monitor compliance and progress on improved health and
safety initiatives.
We also continue to embrace wellbeing events such as R U OK
Day. Our employee engagement survey highlights that we are
progressing well on this front, but the importance of our people
means we are always looking for ways to improve.
Community Development
Developing strong relationships with local stakeholders and
minimising negative impacts from Hansen’s operations and
solutions is not just rhetoric at Hansen. We embed this thinking
into our day-to-day operations.
Embracing this through supporting the social, environmental,
and economic opportunities of the communities in which
Hansen operates has seen our Acts of Impact program
embraced by our people globally.
Hansen’s Acts of Impact
Our Acts of Impact initiative was purposefully designed to
encourage our people to make a meaningful, long-lasting,
and purposeful impact in our local communities and, where
practical, to the global society. Initially this initiative was targeted
to run during our 50th year of sustainable operations. The
success of this initiative was so great we have decided to make
it an annual program.
22
Hansen Technologies Ltd | Annual Report 2023 ACT OF IMPACT
SUPPORTING NEW CIRCLES TO BUILD STRONGER COMMUNITIES
AND HELP KEEP TORONTO WARM THIS WINTER
Our team in Toronto, Canada connected with an
organisation called New Circles and a program
called GLOW (Gently Loved Outfits to Wear).
This organisation supports the community in a range
of ways, from helping outfit people in need as well as
employment training and newcomer resettlement support.
In support of this fantastic organisation, our Hansen
Toronto office held several connection moments with
pizza lunches and at the same time invited people to
bring in quality used clothing that could have a second
life helping clothe and positively impact some of the
community’s more vulnerable members. They then
spent time volunteering at New Circles.
Teams across Denmark, Australia, New Zealand,
North America, and the UK all get behind organisations
like New Circles to help feed, clothe and keep warm
some of our most vulnerable community members
as part of our Acts of Impact.
Hansen Technologies Ltd
| Annual Report 2023
23
Gustav Jensen, Denmark
Senior Service Delivery Manager
ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) REPORT CONTINUED
Governance
Hansen is committed to ethical, transparent, and
accountable operations. We believe this is essential
for the long-term performance and sustainability of the
company, and to protect and enhance the interests of our
shareholders and other stakeholders.
In FY23 we established a cross functional ESG working group
to address, manage and report on our ESG risks. In late 2022
we recruited a new Head of Investor Relations and ESG to
manage our Investor Relations function and build out our ESG
management framework.
We revised our Audit and Risk Committee Charter to include
areas of ESG as a key risk. We also included ESG related risks
on our Enterprise Risk Register, which is reviewed bi-annually.
Across FY24 and FY25 we will be formalising the responsibilities
of our cross functional ESG working group and expanding on
our policy review in line with our ESG strategy.
Data privacy & cyber security
We believe using data responsibly is in everyone’s interest
including our customers, our advisers, our suppliers, our
partners, and our people. We embed the highest possible
security protection mechanisms in our software, and we have
a rigorous testing process to ensure that our security measures
are upheld and provide the right protection for our customers
and their data.
Supporting our development process is a robust range of
policies that our people comply with, including the Hansen
Privacy Policy, Security Policy, and Record Retention Policy.
Anyone with access to Hansen systems is required to
undertake privacy training, to understand what personal data
is and what we can all do to help protect it and is required to
pass an assessment on completion of training as a condition
of accessing our systems. Our people are required to complete
this annually.
Security Operating Model
Hansen Implementation
Business Alignment
Security Governance
Security Architecture
Security risk,
business
continuity &
compliance
management
Security
Program
Management
Security
Operations
Resource Management
Security
Policy
Security
Handbook
Procedures
& Playbooks
Recover
Identify
Information
Security
Functions
Protect
Respond
Detect
Hansen IT Security Framework
Identify
Protect
Detect
Respond
Recover
Identification, inventory,
assessment, and govern-
ance of enterprise assets
and related risks.
What is important to protect,
why protection is necessary,
and what protections
are prudent.
Deployment and manage-
ment of capabilities
designed to monitor for
potential security incidents.
Analysis, implementation,
and maintenance of
methods to address and
minimize impacts of
security incidents.
Maintaining or returning
the business to normal
operations following
security incidents.
24
Hansen Technologies Ltd | Annual Report 2023 IT Security Framework
Hansen’s current Security Framework is based on inputs from
leading industry standards such as ISO27001/2, National
Institute of Standard and Technology (NIST) and the Payment
Card Industry Digital Security Standard. The overarching
framework Hansen follows is the NIST Cyber Security
Framework. An approach to improvement initiatives is currently
being developed based on the Australian Cyber Security
Centre’s Information Security Manual.
IT Security Governance
We know that an effective IT Security program is essential to
our business initiatives and crucial in risk management.
Critical to the success of our program are the following
key success factors:
• continuous, visible support and commitment of Hansen’s
executive management
• central management, with a robust and common strategy
and policy across Hansen
• continuous training and awareness of all employees
• based on threat intelligence led thinking, adapting to
the adversaries Tactics, Techniques and Procedures
• continual improvement
Our IT risk environment is governed by the below.
Responsible & ethical procurement/
Human rights/Modern Slavery
Hansen is committed to maintaining a sustainable supply chain.
This is not just about environmental impact but all that ESG
entails: Ethics, Human Rights, Environment, Carbon Emissions
and Social Responsibility.
Hansen is committed to operating responsibly, with integrity and
sustainably and we expect the same level of commitment from
our supply chain. Respect for the human rights of employees,
customers, suppliers, and other stakeholders with human rights
considerations is embedded in our processes and policies.
We are constantly evaluating our value chain to ensure
compliance with all laws and regulations with respect to modern
slavery. This includes setting labour standards for employees as
well as rejecting modern slavery across our supply chain.
As an IT services company, we have relationships with suppliers
in each of the countries where we operate. These suppliers
provide technological goods and services to our business,
including the provision of servers and equipment used
by our employees and in our data centres, office cleaning
services, office consumables, and leasing services. Services
arrangements with these suppliers are generally in the form
of stable longer-term contractual relationships, and given the
nature of these services, our suppliers are sourced locally.
IT Services Weekly Reporting
• Covers any Critical Incidents
• Security Operations Centre Statistics
• Progress of IT Security Training Completion
• Audit/Pen Test Remediation Tracking
IT Security Steering Committee
• Review of Strategy
• Review of Internal and High
Profile External Incidents
• Tracking of Key Security
Initiatives
Weekly
IT Security Operational
Working Group
• Detailed review of
progress on security
initiatives
Monthly
Board Report
• Covers details of any
critical incidents from
the previous month
International IT Security Update
• International IT Security Update
• Forum with key international stakeholders in EMEA and
North America
• Communication of strategy
• Communication of any relevant incidents
• Communication of progress of security initiatives
Quarterly
25
Hansen Technologies Ltd | Annual Report 2023 ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) REPORT CONTINUED
Trond Morten Buanes, Norway
Support Analyst
26
Hansen Technologies Ltd
| Annual Report 2023
Our methodology for assessing Modern Slavery risk in our supply
chain considers factors such as the nature of the services being
provided, geographic location of such services, the propensity
of the likelihood of modern slavery in relation to those services,
and whether there were any general indicators of modern
slavery with those suppliers. We then prioritise higher risk areas
to perform further due diligence and engage in risk mitigation
strategies to prevent potential modern slavery practices.
Code of Conduct for our Suppliers
During FY23 we developed and piloted our Code of Conduct for
our Suppliers and will be rolling this out globally during FY24.
This Code of Conduct articulates a vision of responsible
business behaviour and principles that Hansen requires its
suppliers to abide by in the course of their business relationship
with Hansen.
Our Code of Conduct reflects our own ESG aspirations and
‘tickets to play’ including Working Conditions, Human Rights,
Modern Slavery, and expectations around caring for the
Community and Environment.
Business ethics / Anti-competitive behaviour /
Regulatory compliance
At Hansen we recognise that our company is made up of the
individual employees representing our operations globally.
Each person has an individual responsibility for their own
behaviour and should take accountability for their actions
and choices. The Hansen Code of Conduct reflects the Hansen
Group’s primary values of ethical behaviour, compliance
with legal obligations, and respecting the expectations
of all stakeholders.
As a company publicly listed in Australia for over 20 years, we
take the values and principles detailed in our Code of Conduct
very seriously. Our Code of Conduct implements values,
principles, policies, and procedures that prevent fraud, bribery,
and discrimination from occurring in Hansen’s daily operations
during stakeholder interactions and across our value chain.
Hansen employees operate in numerous countries and we
observe the laws of each jurisdiction not just because they
are law but because it is right to do so.
Leadership, governance & transparency
All Hansen people have a responsibility to incorporate risk
management into their day-to-day operations. Our risk
governance structure provides oversight of the effective
operation of our framework through the following
governing bodies:
• The Board has overall responsibility for ensuring that an
effective risk management framework is established.
• The Audit and Risk Committee (ARC) is appointed and
authorised by the Board to assist in carrying out its obligations
as they relate to risk management. The ARC has responsibility
for endorsing the framework and reviewing material
enterprise risks in light of the risk appetite set by the Board.
Risk assessment and assurance process
At Hansen we take a proportionate approach to our risk
assurance including self-evaluation and independent external
assurance activities to ensure that our material risks are
appropriately measured and managed.
Our risk management approach is dynamic. We regularly
anticipate, detect, acknowledge, and respond to changes in
our internal and external environment following the principles
outlined in ISO 31000:2018 Risk Management – Guidelines.
We collate and record information into a risk register servicing
our global operations to communicate and manage risk across
the organisation.
HANSEN EMPLOYEES OPERATE IN NUMEROUS
COUNTRIES AND WE OBSERVE THE LAWS OF
EACH JURISDICTION NOT JUST BECAUSE THEY
ARE LAW BUT BECAUSE IT IS RIGHT TO DO SO.
ACT OF IMPACT
MAKING THE MID-AUTUMN FESTIVAL SPECIAL
FOR THE CHILDREN OF DIEU GIAC ORPHANAGE
Our team in Vietnam undertook several activities to help the
children at Dieu Giac Pagoda Orphanage. The orphanage
is home to 60 children, some of whom are in good physical
health and others who suffer from mental disabilities. Many
of these children were originally abandoned at the Pagoda’s
gate or at nearby hospitals!
Our people worked together to make, bake, and donate
items that we could all buy to raise some money in support
of a gala fair where we could provide gifts and a day of fun
during Mid-Autumn Festival, which is a festival for children.
The money raised was used to buy gifts for the children and
essentials to support the orphanage including shampoo,
seasoning, cooking oil, and toothpaste.
We spent the day talking to and playing with the orphans,
listening to their stories. We are planning how we can create
more impact with more acts.
Hansen Technologies Ltd
| Annual Report 2023
27
BOARD OF DIRECTORS AND COMPANY SECRETARY
The qualifications, experience and special responsibilities of each person who has been a Director of Hansen Technologies Limited
at any time during or since the end of the financial year are provided below, together with details of the Company Secretary as at
the year end.
Mr David Trude
Mr Andrew Hansen
Ms Julia Chand
Mr David Howell
Non-Executive Director
Managing Director
Chairman since 2011
Managing Director
Director since 2011
Managing Director since 2000
Age 75
Age 63
General Counsel and
Company Secretary
Company Secretary
since 2014
Age 53
Julia joined Hansen
Technologies in 2007 and
plays a strategic role as
General Counsel as well as
Company Secretary. Julia has
significant legal experience in
IT, financial services and retail
organisations. As Company
Secretary she is responsible
for the Company’s corporate
and ASX obligations.
David has extensive
experience in a variety of
financial services roles within
the banking and securities
industries. He holds a
degree in commerce from
the University of Queensland
and is a member of many
professional associations
including the Stockbrokers
and Financial Advisers
Association of Australia and
the Australian Institute of
Company Directors.
David is also a Non-Executive
Director of Cboe Australia
Pty Ltd and Non-Executive
Director of ASX listed Acorn
Capital Investment Fund
Limited and MSL
Solutions Ltd.
Andrew has over 40 years’
experience in the IT industry,
joining Hansen in 1990. Prior
to Hansen, he held senior
management positions with
Amfac-Chemdata, a software
provider in the health industry.
Andrew led Hansen from its
listing on the ASX in 2000 to
today being a global business
with a strong history of
decades of strong profitability
and growth.
Andrew is responsible for
implementing the Group’s
strategic direction and
overseeing the everyday
affairs of the Hansen Group.
Non-Executive Director
Chair of the
Remuneration
Committee
Member of the Audit
and Risk Committee
Age 65
David Howell joined the
Hansen Technologies
Board in 2018. He is a highly
accomplished executive
having worked across
a number of industries
including financial services,
retail, technology and social
media. David has had roles as
Chairman, Managing Director,
Non-Executive Director and
Board Advisor across large
corporates, SMEs and early-
stage businesses, including
private equity.
David is also a Non-Executive
Director of The Pistol (a digital
marketing agency).
Unless stated, no Directors of Hansen Technologies Limited held any other Directorships of listed companies at any time during
the three years prior to 30 June 2023.
28
Hansen Technologies Ltd | Annual Report 2023 Mr Don Rankin
Ms Lisa Pendlebury
Mr Bruce Adams
Mr David Osborne
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Director since 2019
Director since 2022
Director since 2000
Director since 2006
Member of the
Remuneration
Committee
Age 63
Member of the Audit
and Risk Committee
Age 74
Bruce has over 30 years’
experience as a commercial
and corporate lawyer. He has
practised extensively in
the areas of information
technology law, contract law
and mergers and acquisitions
and has considerable
experience advising listed
public companies.
Bruce has held positions
as partner of two Australian
law firms and general
counsel of an Australian
owned international
group of companies. He
holds degrees in Law and
Economics from Monash
University and is a graduate
of Australian Institute of
Company Directors.
David is a Fellow of the
Institute of Chartered
Accountants, and a Fellow
of the Australian Institute of
Company Directors, with
over 50 years of financial
management, taxation and
accounting experience in
public practice.
David’s experience includes
having been the Audit Partner
of his accounting practice
and a Registered Company
Auditor for over 25 years.
He also has experience in
the various aspects of risk
management. David has a
long-standing association with
Hansen, having been a Board
member for some years prior
to the Company’s listing on
the ASX in June 2000.
Chair of the Audit
and Risk Committee
Member of the Audit
and Risk Committee
Member of the
Remuneration
Committee
Age 71
Member of the
Remuneration
Committee
Age 48
Don Rankin joined the
Hansen Technologies Board
in 2019. He was one of the
founding partners of Pitcher
Partners and National
Chairman of the Pitcher
Partners Association
for 11 years.
With over 30 years’
experience advising private
and family businesses across
a broad range of industries,
he specialises particularly
in assisting clients in the
management, growth and
evolution of their business.
Don sits on a number of
Family Board Advisory
Committees. For many years
Don was on the board of
the Victorian Chamber of
Commerce and Industry
and was its President for
three years.
Don has a long involvement
with Cottage by the Sea in
Queenscliff, a charity for
disadvantaged children
and is its current President.
Lisa is an experienced
executive who has worked
in the healthcare, consumer
products and finance industry
for more than 20 years. Lisa
commenced her career in
investment banking at JP
Morgan before moving to
private equity with CVC
Capital Partners. She spent
12 years at Mayne Pharma
and was an executive on
the senior leadership team.
She is currently General
Manager, Corporate
Development at Regis
Healthcare. Lisa has extensive
experience in business
development, mergers and
acquisitions, corporate
strategy, investor relations,
financial reporting, corporate
governance, remuneration
and sustainability. Lisa has
a CPA and holds a Bachelor
of Commerce and Bachelor
of Science degree from the
University of Melbourne. She is
Treasurer of EDFA, a not-for-
profit organisation.
29
Hansen Technologies Ltd | Annual Report 2023 DIRECTORS’ REPORT
The Directors present their report together with the Financial Report of the consolidated entity (‘the Group’), being Hansen
Technologies Limited (‘the Company’) and the entities it controlled for the financial year ended 30 June 2023, and Auditor’s
Report thereon. This Financial Report has been prepared in accordance with Australian Accounting Standards.
Principal activities
The principal activities of the Group during the financial year were the development, integration, and support of billing systems
software for the Energy and Communications sectors. Other activities undertaken by the Group include IT outsourcing services
and the development of other specific software applications.
OPERATING AND FINANCIAL REVIEW
Review of operations
The Group’s operating performance for the fiscal year compared to last year is as follows:
Operating revenue
Underlying EBITDA(1)
NPAT
Underlying NPAT(2)
Underlying NPATA(1), (3)
Basic Earnings per Share (EPS) (cents)
Basic EPS based on underlying NPATA (EPSa) (cents)(1)
2023
A$ Million
311.8
99.5
42.8
41.5
55.6
21.1
27.5
2022
A$ Million
Variance
%
296.5
100.3
41.9
42.2
58.2
20.9
29.0
5%
(1%)
2%
(2%)
(4%)
1%
(5%)
(1) The Directors believe the information additional to IFRS measures included in the report is relevant and useful in measuring the financial performance of the
Group. These include: EBITDA, NPATA and EPSa. These measures have been defined in the Chairperson and Managing Director’s Joint Report on page 10.
(2) Underlying net profit after tax attributable to members excludes separately disclosed items (net of tax). Further details of the separately disclosed items are
outlined in Note 4 to the Financial Report.
(3) Underlying net profit after tax (adjusted) attributable to members excludes separately disclosed items and acquired amortisation (net of tax). Further details
of the separately disclosed items are outlined in Note 4 to the Financial Report.
In FY23 the business delivered another set of impressive results following on from the successful FY22 year. Further details on the
Group’s results are outlined in the Chairperson and Managing Director’s Joint Report on page 8.
The Group’s revenue for the financial year was $311.8 million, an increase of 5.2% on FY22. At the end of FY23 Net Debt was
effectively zero.
During the global challenges of the past few years, there was a reduction in many of the Group’s expenses. FY23 has seen some of
these expenses normalise as the Group reconnects with its customers, its people, and the industry. Pleasingly, employee numbers
are also back to pre-pandemic levels as the group reinvests in its people. Despite these increases the Group has maintained
solid growth and its underlying EBITDA margin of 31.9%, achieved in a tough inflationary environment, is well above its long-term
benchmark of 25-30%.
The Group continues to demonstrate its stability as a consistently cash-generative organisation generating $78.8 million of
operating cash flows, which has been used to retire net external debt of $33.6 million, pay dividends of $18.4 million (net of
dividend reinvestments) and fund the capitalised portion of its ongoing product development (R&D) program of $21.1 million.
The Group prioritises reinvestment in its products, with capitalised R&D increasing 35% from FY22. The Group’s investments range
across a variety of areas including cloud-native, regulatory compliance, B2B and enhanced customer experiences along with the
exploration of the opportunities that Artificial Intelligence, 5G and Internet of Things bring. This increased investment has supported
several new logo wins, and significant upgrades with existing customers throughout the year.
With the Group’s cash generation capabilities combined with significant future borrowing capacity, Hansen remains well placed
to continue to acquire mature, value accretive and predictable businesses in the energy and communications sectors.
Billing segment
The Billing segment represents a major part of the Group’s business operations, delivering $305.0 million of revenue in 2023 (2022:
$289.0 million), which translates into a 5.5% increase. Segment profit before tax was $58.7 million in 2023 (2022: $53.6 million),
representing a 9.5% increase.
30
Hansen Technologies Ltd | Annual Report 2023 Other activities
Segment revenues from other activities was $6.8 million in 2023 (2022: $7.6 million), representing a 10.5% decrease for the year.
This 10.5% decrease in revenues resulted from an expected reduction in business activity associated with the planned closure
of the Australian Data Centre scheduled for completion in December 2024. Segment profit before tax was $1.4 million for 2023
(2022: $1.7 million), representing a 17.6% decrease for the year.
Significant changes in the state of affairs
There have been no significant changes in the Group’s state of affairs during the financial year.
Subsequent events
No matters have arisen between the end of the financial year and the date of this report that have significantly affected or may
significantly affect the operations of the Group, the results of those operations or the state of affairs of the Group in future years.
Opportunities and business risks
The business remains committed to increasing shareholder value while managing the risk profile of the Group.
The Energy and Communications markets continue to evolve and with this change comes complexity and opportunity. The
Communications vertical is experiencing rapid progress in the roll out and adoption of 5G technology. Energy continues to develop
new offerings and the continued roll out of green energy initiatives. Both verticals continue to develop enhanced digital platforms to
deliver a satisfactory customer experience.
To ensure we deliver on our strategic objectives, the Group continues to operate an Enterprise Risk Management Framework
that actively identifies, controls, plans and mitigates a wide array of risks across functions and geographies and seeks to unlock
opportunities to gain a competitive advantage.
The material business risks that have the potential to impact Hansen’s financial prospects and future performance are outlined
below, together with mitigating actions undertaken to minimise these risks.
Risk
Nature of Risk
Mitigating actions
Information
security,
including cyber
attacks
Hansen may be exposed to an event
or events which may result in Hansen
or Hansen’s client’s information being
unavailable, lost, stolen, copied, or
otherwise compromised with adverse
consequences for the business.
Our information security risks remain
heightened due to the growing
sophistication and increased frequency
of cyber attacks within all industries.
As the nature of cyber-crime is constantly evolving, Hansen
continues to invest in a wide range of information security
protection and preventative measures in response to the
increasing threats presented by cyberattacks and cyber terrorists.
Hansen’s current Security Framework is based on inputs from
leading industry standards such as ISO27001/2, National Institute
of Standard and Technology (NIST) and Payment Card Industry
Digital Security Standard. The overarching framework Hansen
follows is the NIST Cyber Security Framework. An approach to
improvement initiatives is currently being developed based on the
Australian Cyber Security Centre’s Information Security Manual.
Critical to the success of our program are the following key
success factors:
• continuous, visible support and commitment of Hansen’s
executive management
• central management, with a robust and common strategy
and policy across Hansen
• continuous training and awareness of all employees
• based on threat intelligence led thinking, adapting to the
adversaries Tactics, Techniques and Procedures
• continual improvement
31
Hansen Technologies Ltd | Annual Report 2023 DIRECTORS’ REPORT CONTINUED
Risk
Nature of Risk
Mitigating actions
Technology
change or
failure of critical
systems
Significant shifts in technology, such
as Artificial Intelligence, may adversely
impact our business or
the demands of the industries
Hansen serves.
Hansen maintains a highly skilled team of technology
professionals, who constantly test the potential utilisation
and / or impact of emerging technologies. Mitigation of
technology risk and optimal utilisation of new technology lies
at the heart of Hansen’s software development practices.
Foreign
exchange
External
operating
environment
Investment
opportunities
A critical technology system or process
failure, whether by environmental
disruption, error, or attack, may cause
significant adverse impact to Hansen
and Hansen’s clients.
Hansen seeks to manage market change by maintaining its
customer first approach.
Hansen’s Business Continuity and Disaster Recovery Plans
are tested, updated, and reviewed on an annual basis.
The testing ensures that access to critical systems, including
backup environments, are restored and any potential
disruption minimised.
Due to its international operations,
Hansen may be exposed to foreign
exchange movements, which may impact
the value of profits repatriated
to Australia.
Hansen mitigates foreign exchange risk associated with
its international operations by, where possible, funding its
investments and operations in the local currency. Foreign currency
transaction risks can be hedged, where appropriate. Hansen
does not hedge translation risk on foreign currency earnings.
Hansen has a diversified geographic presence and varied product
and customer portfolio, which has a high portion of recurring
revenues. Hansen actively monitors the impact of changes
in the external operating environment on the business, including
people, customers, financial performance, and financial position.
Hansen’s approach to M&A involves careful planning and
execution, with thorough due diligence to identify potential
challenges and synergies conducted.
Where an acquisition is made, a comprehensive integration
strategy with clear timelines and responsibilities is developed.
Cultural alignment and actions to retain key talent are priorities.
Hansen ensures financial projections are thoroughly analysed
and reviewed to avoid overpaying for the target company.
During and post integration robust financial reporting and control
systems are embedded. Hansen regularly assesses and adjusts
the integration process as needed.
Changes to the external operating
environment, including macroeconomic
factors such as inflation and interest
rates as well as geopolitical factors, may
negatively impact client demand and the
cost of providing Hansen’s products.
The Group has an active M&A program.
Key risks of this strategy include financial
challenges due to the substantial nature
of the investment and the possibility of
diluted shareholder value if anticipated
synergies do not materialise.
Integration difficulties, including cultural
clashes and loss of key talent, may
disrupt operations.
Regulatory and legal risks, such as delays
in obtaining approvals, could hinder the
success of the acquisition.
Overestimating synergies and
underestimating integration complexity
pose additional risks.
Reputational damage may occur if the
acquisition is not executed effectively.
Employee
recruitment
and retention
Hansen’s people are critical to the
Group’s ongoing success. Loss of key
people may lead to a loss of critical
skills, knowledge, and experience,
which may disrupt workflow, or impact
key relationships with stakeholders and
impact Hansen’s competitive advantages.
Hansen manages risks to the employee base by focusing on the
employee value proposition. Hansen strives to create a positive
work environment that fosters employee engagement and
satisfaction. Hansen offers competitive remuneration and benefits
packages tailored to the market in which personnel are based.
Hansen conducts regular performance reviews to support its
people and identify any potential issues early on.
Succession planning and knowledge sharing help mitigate any
potential loss of knowledge from employee movements.
32
Hansen Technologies Ltd | Annual Report 2023 Risk
Loss of
customers
Nature of Risk
Mitigating actions
Hansen maintains a diverse portfolio of
Tier 1 and 2 customers. A loss of
a key customer due to market risk may
negatively impact the financial success
of the business.
Hansen has a diverse range of customers across geography
and vertical with no one customer delivering more than 7%
of Hansen’s total revenue.
Despite the relatively low risk of significant financial impact from
the loss of one customer, Hansen is focused on meeting and
exceeding customers’ expectations for system performance
and service delivery.
Outlook and likely developments for FY24
With the acceleration of change in Hansen’s core markets of energy and communications, whether it’s the transition to renewable
energy sources, or rollout of 5G networks, Hansen is seeing increased demand in its software and supporting services.
Hansen is actively seeking to increase brand awareness and expand its sales capabilities in both existing and new markets.
Hansen has been enhancing its sales and marketing efforts to capture more tier one organic growth.
Hansen is well-placed to grow and evolve both its product and solution offerings, and its customer portfolio with a strong talent
pool that is an excellent mix of senior and experienced professionals, as well as younger yet highly passionate and talented
emerging leaders.
Hansen remains committed to not just growing organically, but via a disciplined and focused aggregation approach. Hansen is
predominantly targeting businesses within the communications and energy industries, with a focus on companies that are driving
profitable innovation and growth.
The Board remains confident that the Hansen approach and strategy align with the long-term goals of both the Company
and shareholders.
As always, shareholders are kept abreast of any changes to our strategy or financial outlook as each year progresses.
Environmental regulations and climate change
The Group’s operations are not subject to any significant environmental Commonwealth or state regulations or laws. The Group
is aware of the general risks associated with climate change and is committed to continual improvement in its approach to ESG.
In FY23, the Group reapplied for Carbon neutral certification of its Australian Operations and has signalled its intention to measure
its global scope 1-3 emissions over time.
During FY23, with the support of independent experts Hansen commenced an assessment of its material ESG topics and
developed an Environmental Sustainability and Governance roadmap. A cross functional ESG working group has been established
to facilitate and support Hansen’s ESG approach. Hansen has also indicated its intention to begin preparations on a climate report
aligned to the TCFD / ISSB.
Corporate governance statement
Hansen and the Board are committed to achieving and demonstrating the highest standards of corporate governance.
A description of the Group’s current corporate governance practices is set out in the Group’s corporate governance statement,
which can be viewed at https://hansencx.com/about/investor relations.
Dividends paid and declared
A final dividend of 5 cents per share has been declared, partially franked to 1.5 cents per share, comprising of a regular dividend of
5 cents per share. The final dividend was announced to the market on 23 August 2023, with payment to be made on 20 September
2023. The amount declared has not been recognised as a liability in the accounts of the Company as at 30 June 2023.
Dividends paid during the year, excluding dividends reinvested as part of the Company’s Dividend Reinvestment Plan (DRP):
• 5 cents per share unfranked interim dividend paid on 21 March 2023, totalling $9,237,147; and
• 5 cents per share partially franked to 1.5 cents final dividend paid on 21 September 2022, totalling $9,165,596.
This is consistent with the Board’s capital management policy that balances growth through acquisitions against the payment
of dividends.
33
Hansen Technologies Ltd | Annual Report 2023 DIRECTORS’ REPORT CONTINUED
Performance rights
Performance rights over shares may be issued to Key Management Personnel (KMP) as an incentive for motivating and
rewarding performance as well as encouraging longevity of employment. The issuing of performance rights is intended to
enhance the alignment of KMP with the primary shareholder objective of increasing shareholder value.
Performance rights over unissued ordinary shares granted by the Company during the financial year to the KMP as part of their
remuneration for the year ended 30 June 2023 are as follows:
Grant Date
Executives
A Hansen
D Meade
G Taylor
R English(2)
Total
Number of Rights
Granted on 15 Sep 2022(1)
94,475
22,216
23,987
19,925
160,603
(1) The number of rights granted that will vest is conditional on achievement of annual financial and non-financial measures under the LTI plan. The above KMP
will be awarded a combined total of additional 80,302 rights if they overachieve the performance measures. Refer to the Remuneration Report for further details.
(2) Richard English commenced as an Executive KMP on 22 February 2023. The balance disclosed above reflects rights granted during the year inclusive of when
he became an Executive KMP.
There were no rights granted to the KMP over unissued ordinary shares since the end of the financial year as part of their
remuneration.
All grants of rights are subject to the achievement of performance measurements.
Further details regarding rights granted as remuneration are provided in the Remuneration Report.
Shares and performance rights
Unissued ordinary shares of the Company under performance rights at the date of this report are as follows:
Instrument
Plan
Rights
Rights
Rights
Rights
STI
LTI
LTI
LTI
Grant Date
1 Jul 2020
1 Jul 2020
15 Sep 2021
15 Sep 2022
Vesting Date
30 Jun 2023(1)
30 Jun 2023(2)
30 Jun 2024(3)
30 Sep 2025(3),(4)
Number of
Rights at
30 June 2023
523,247
199,303
290,751
444,030
(1) STI performance rights granted on 1 July 2020 vested on 30 June 2023. The rights were subsequently exercised on 14 August 2023.
(2) Performance rights for the FY21 LTI Plan vested on 30 June 2023. The rights were subsequently exercised on 14 August 2023.
(3) All performance rights will vest on the vesting date as indicated in the above table, subject to achievement of specific measurement criteria.
(4) Expected vesting date is advised in writing by the Board following consideration of performance during the measurement period, but no later than
30 September 2025.
Performance rights holders do not have any right, by virtue of the performance right held, to participate in any share issue of the
Company. Performance rights will not give any right to participate in dividends or any voting rights until shares are issued upon the
exercise of vested performance rights.
34
Hansen Technologies Ltd | Annual Report 2023 Shares issued on exercise of performance rights
The following ordinary shares of the Company were issued during or since the end of the financial year as a result of the exercise
of performance rights:
Date Issued
19 Aug 2022
14 Aug 2023
Total
Number of Ordinary Shares
Issued on Exercise of
Performance Rights
789,817
722,550
1,512,367
Indemnification and insurance of Directors, officers and auditors
Indemnification
The Company has agreed to indemnify all of the current and former Directors and officers of the Company and its controlled entities
against all liabilities to another person (other than the Company or a related body corporate) that may arise from their position as
Directors and officers of the Company and its controlled entities, except where the liability arises out of conduct involving a lack of
good faith. The agreement stipulates that the Company will meet the full amount of any such liabilities, including costs and expenses.
The Group has not entered into any agreement to indemnify its auditors against any claims that might be made by third parties
arising from their report on the annual Financial Report.
Insurance
Since the end of the previous financial year, the Company has paid insurance premiums in respect of Directors’ and Officers’ liability
and legal expenses and insurance policies for current and former Directors and Officers, including executive officers of the Company
and Directors, executive officers and secretaries of its controlled entities. The Directors have not included details of the nature of the
liabilities covered or the amount of the premium paid in respect of the Directors’ and Officers’ liability and legal expenses insurance
contracts as such disclosures are prohibited under the terms of the contract.
No insurance premium is paid in relation to the auditors.
Rounding of amounts
In accordance with ASIC Corporations (Rounding in Financial/ Directors’ Reports) Instrument 2016/191, the amounts in the
Financial Report have been rounded to the nearest one thousand dollars, or in certain cases, to the nearest dollar (where indicated).
Directors’ meetings
The number of meetings of the Board of Directors and of each Board Committee held during the financial year and the numbers
of meetings attended by each Director were:
Director
Mr David Trude
Mr Bruce Adams
Mr Andrew Hansen
Mr Don Rankin
Mr David Osborne
Ms Lisa Pendlebury
Mr David Howell
Board Meetings
Audit and Risk
Committee Meetings
Remuneration
Committee Meetings
Eligible
Attended
Eligible
Attended
Eligible
Attended
12
12
12
12
12
12
12
10
12
12
11
12
12
11
–
–
–
7
7
7
7
–
–
–
7
7
7
5
–
5
–
5
–
5
5
–
5
–
4
–
5
4
35
Hansen Technologies Ltd | Annual Report 2023 DIRECTORS’ REPORT CONTINUED
Directors’ interests in shares
Directors’ relevant interests in shares of the Company or options/rights over shares in the Company as at the date of this report
are detailed below:
Directors’ Relevant Interests in:
Mr David Trude
Mr Bruce Adams(1)
Mr Andrew Hansen(1)
Mr Don Rankin
Mr David Osborne(1)
Ms Lisa Pendlebury
Mr David Howell
Ordinary Shares
of the Company
111,678
34,891,417
35,450,073
25,000
35,125,448
13,869
43,805
Rights Over
Shares in the
Company
–
–
382,187
–
–
–
–
(1) Each of Mr Bruce Adams, Mr Andrew Hansen and Mr David Osborne has a joint interest in a single parcel of 34,739,113 shares as at the date of this report.
Proceedings on behalf of the Company
No person applied for leave of Court to bring proceedings on behalf of the Company or any of its subsidiaries.
Directors’ interests in contracts
Directors’ interests in contracts with the Company are limited to the provision of leased premises on arm’s length terms and are
disclosed in Note 25 to the financial statements.
Auditor’s Independence Declaration
A copy of the Auditor’s Independence Declaration as required under section 307C of the Corporations Act 2001 in relation to the
audit for the financial year is provided with this report.
Non-audit services
Non-audit services were provided by the auditors of the Group during the year, namely RSM Australia Partners, network firms
of RSM and other non-related audit firms as detailed below. The Directors are satisfied that the provision of the non-audit
services during the year by the auditors is compatible with the general standard of independence for auditors imposed by the
Corporations Act 2001. The nature and scope of each type of non-audit service provided means that auditor independence
was not compromised.
Amounts paid and payable to RSM Australia for non-audit services:
– compliance services
Sub-total
Amounts paid and payable to network firms of RSM Australia for non-audit services:
– taxation services
– compliance services
Sub-total
Amounts paid and payable to non-related auditors of Group entities for non-audit services:
– taxation services
– compliance services
Sub-total
Total auditor’s remuneration for non-audit services
Auditor’s remuneration is disclosed in Note 26 of the Financial Report.
36
2023
$
13,715
13,715
39,636
48,149
87,785
61,546
51,690
113,236
214,736
2022
$
3,567
3,567
65,444
54,776
120,220
9,095
28,475
37,570
161,357
Hansen Technologies Ltd | Annual Report 2023 REMUNERATION REPORT
Dear Shareholder,
On behalf of the Board of Directors, I am pleased to present the Remuneration Report of the Group, consisting of Hansen
Technologies Limited (“the Company”) and its controlled entities for the 2023 financial year.
The 2023 financial year has been an outstanding year for Hansen delivering strong organic revenue growth and underlying
EBITDA margins whilst paying down debt to achieve an effective net debt zero position at the end of the year. This performance
is testament to the strength and leadership of our global management team in continuing to drive the business forward through
a combination of new logo wins and the retention and expansion of existing customers.
Up until June 2023, Andrew Hansen had held the positions of both Chief Executive Officer and Managing Director. This meant
his leadership and focus spanned both the operational leadership and the strategic direction of the company.
As a company of more than 1,600 people, coupled with a rich and buoyant acquisition history, Hansen announced a decoupling
of the roles and appointed long-term Hansen executive Graeme Taylor to the position of CEO on 19 June 2023, with Andrew
Hansen as Managing Director, focused on leading strategic growth including inorganic M&A.
I am pleased to advise that the FY21 Enhanced STI scheme measurement and vesting periods have now concluded.
As previously disclosed, the STI targets set in place in July 2020 were achieved at 135% and vested at 30th June 2023.
Throughout a period of many challenges, the KMP successfully met and exceeded the expectations of the Board.
During the financial year 2023, Hansen undertook a review of its compensation models for Directors, Executives and Key
Management Personnel (KMP) against similarly situated companies. As a result, Hansen has revised the compensation model
to be consistent with models of similarly situated ASX-listed companies.
Hansen’s revised compensation model ensures that Hansen’s operational goals and objectives continue to deliver responsible
cost management and sustainable growth which in turn ensures increasing value for its shareholders. As a result of this
remuneration review, Hansen has retained the current structure of the STI program focused on financial and non-financial
metrics and developed and updated its LTI plan for the FY24 year.
The revised LTI plan aims to drive long-term profitability and increased shareholder returns by improving motivation and retention
and/or attraction of key employees. The plan includes hurdles that must be satisfied for vesting to occur, including a minimum
underlying EBITDA margin and organic revenue growth thresholds. Key targets for the FY24 LTI scheme are Board defined
three-year cumulative organic revenue and EBITDA growth targets.
Organic revenue growth is a transparent and easily measurable metric. It promotes sustainable performance and motivates our
KMP to develop and execute strategies that nurture customer relationships, improve product offerings, enhanced operational
efficiency, and to prioritise profitable sustainable revenue streams over short-term gains.
EBITDA growth is a widely recognised metric by Hansen’s employees, shareholders and analysts. By focusing on EBITDA
growth, KMP are incentivised to drive operational excellence, optimise cost structures, and maximise profitability, encouraging
Hansen’s KMP to make strategic decisions that enhance the long-term financial health and sustainability of the company.
Both of the above metrics are strongly aligned with the Group’s strategic initiatives to generate sustainable long-term shareholder
value by way of increasing profitability and cash generation, which should result in increased earnings per share (EPS) and return
on equity (ROE).The Board is committed to the ongoing review of the Group’s Remuneration Framework to ensure it achieves its
objectives of incentivising and rewarding performance that optimises business and shareholder value and ensuring the Company
is well placed to attract, retain and motivate a talented Executive team.
Yours sincerely,
David Howell
Chair of the Remuneration Committee
37
Hansen Technologies Ltd | Annual Report 2023 REMUNERATION REPORT CONTINUED
OUR DETAILED REMUNERATION REPORT (AUDITED)
The Remuneration Report for the year ended 30 June 2023 outlines key aspects of our remuneration framework and has been
prepared and audited in accordance with the Corporations Act 2001.
Our Remuneration Report contains the following sections:
1. Persons to whom this report applies
2. Our remuneration framework
3. How reward is linked to performance
4. Remuneration details: Executive KMP
5. FY24 Incentive Plan
6. Contractual arrangements with Executive KMP
7. Remuneration details: Non-Executive KMP
8. Share-based remuneration disclosures
9. Other transactions with KMP
10. Employee Share Trust
1. Persons to whom this report applies
The remuneration disclosures in the Report cover the following persons who were classified as the Key Management Personnel
(KMP) of the Group during the 2023 financial year. KMP are those persons who, directly or indirectly, have authority and
responsibility for planning, directing and controlling the major activities of the Group:
Executives(1)
Andrew Hansen(2)
Graeme Taylor(2)
Darren Meade
Richard English(3)
Non-Executive Directors
David Trude
Lisa Pendlebury
David Howell
Don Rankin
Bruce Adams
David Osborne
Managing Director
Chief Executive Officer (CEO)
Group Head of Delivery
Chief Financial Officer
Chairperson and Independent Non-Executive Director
Independent Non-Executive Director
Independent Non-Executive Director
Independent Non-Executive Director
Non-Executive Director
Non-Executive Director
(1) These executives of the Group were classified as KMP during the 2023 financial year and unless stated otherwise, were KMP for the entire year.
(2) With effect from 19 June 2023, the roles of the Chief Executive Officer and Managing Director were decoupled. Graeme Taylor was promoted to Chief
Executive Officer. Andrew Hansen remains as Managing Director.
(3) With effect from 22 February 2023, Richard English was promoted to Chief Financial Officer.
At the most recent Annual General Meeting (AGM), a resolution to adopt the prior year Remuneration Report was put to the
vote and at least 75% of ‘yes’ votes were cast for adoption of that report.
The FY22 Remuneration Report received strong shareholder support at the 2022 AGM with a vote of 85.83% in favour. A resolution
covering the issue of rights under the LTI to the Managing Director and/CEO also received strong support with 88.93% of votes
in favour.
38
Hansen Technologies Ltd | Annual Report 2023 2. Our remuneration framework
People are at the heart of the Group’s success, enabling us to deliver on our vision and long-term goals. Our remuneration
framework focuses on providing competitive fixed pay and variable pay that rewards achievement of the Group’s annual
objectives and long-term growth in shareholder value.
Remuneration outcomes are aligned with both individual and Group performance, ensuring that employees are rewarded for overall
Group achievement as well as their individual contribution to the Group’s success. This aligns remuneration to both individual
performance and value creation for shareholders.
(a) Remuneration governance
The Board annually reviews the Group’s remuneration principles, practices, strategy and approach to ensure they support
the Group’s long-term business strategy and are appropriate for a listed company of our size and nature.
The Board has delegated to the Remuneration Committee the responsibility for reviewing and making recommendations to
the Board regarding compensation arrangements for the Directors, Executive KMP and the balance of the Managing Director’s
direct reports. As at 30 June 2023, the Remuneration Committee was made up of four Non-Executive Directors: David Howell
(Chair of the Remuneration Committee), Bruce Adams, Don Rankin and Lisa Pendlebury, the majority of whom are independent.
The Managing Director and other Directors attend meetings as required at the invitation of the Committee Chair.
The Remuneration Committee assesses the appropriateness of both the nature and amount of remuneration paid to the
Executive and Non-Executive KMP on an annual basis by reference to market conditions and current remuneration practices,
with the overall objective of ensuring maximum company performance and shareholder benefit from the retention of a quality
Board and Executive team. The Committee also engages professional support as required to ensure remuneration practices
remain in step with the market as well as the size and nature of the business.
(i) Executive KMP remuneration review process
Managing Director
• Assesses each Senior Executive’s
current year performance
based on actual outcomes
relative to agreed targets,
general performance and
market conditions.
• Provides appropriate
recommendations to the
Remuneration Committee
on incentive payments for
the current year.
• Provides appropriate
recommendations to the
Remuneration Committee of
the amount of fixed remuneration,
appropriate STI targets
and LTI payments for future
measurement periods.
Remuneration
Committee
Board
• Reviews the Remuneration
Committee’s recommendations.
• Approves current year STI
and LTI plans.
• Approves the remuneration
structure for future
measurement periods,
including STI and LTI targets.
• Reviews the Managing Director’s
recommendations with respect
to the Senior Executive team
and provides appropriate
recommendations to the Board.
• Assesses Managing Director’s
current year performance and
remuneration outcomes against
agreed targets, formulating a
recommendation to the Board.
• Provides appropriate
recommendations to the Board
of the amount of the Managing
Director’s fixed remuneration, and
appropriate STI and LTI targets
for the future measurement
period, considering general
performance, market conditions
and other external factors.
39
Hansen Technologies Ltd | Annual Report 2023 REMUNERATION REPORT CONTINUED
(ii) Non-Executive Directors remuneration review process
Non-Executive Directors’ remuneration is governed by resolutions passed at a General Meeting of the Shareholders. During the
AGM held on 24 November 2022, shareholders approved an increase to the Non-Executive Directors’ maximum remuneration
payable from $750,000 to $780,000.
Non-Executive Directors are excluded from participation in the Company’s equity incentive plans.
(iii) Remuneration strategy, structure and market practice
To support the review of the 2023 remuneration framework, the Remuneration Committee has considered detailed and extensive
reports, inputs and benchmarking provided to the Committee in relation to the remuneration strategy, structure, market and
competitor practice. The Committee will supplement this internal advice with external specialist advice from time to time.
No external remuneration recommendations, as defined by the Corporations Act 2001, were provided during the year.
(b) Remuneration structure (FY23 Plan)
OBJECTIVE
COMPONENT AND FORM
ASSESSMENT
Attract and retain employees
with the skills and experience
associated with the role.
Total Fixed
Remuneration (TFR)
Cash + non-cash
benefits
Fixed
Incentivise and reward
achievement of annual
performance objectives
and business outcomes.
Short-term
incentive
Cash
Align motivations with
shareholder interests and
creation of long-term value.
Long-term
incentive
Performance rights
to shares (3 years)
Variable
(‘at-risk’)
Market data,
individual experience
and performance
Annual performance
based on financial
and non-financial
targets
Continuous
employment,
relative Total
Shareholder Returns
and Revenue targets
(i) Total Fixed Remuneration (TFR)
TFR typically includes base salary and superannuation contributions and may include, at the discretion of the Board, other
benefits such as a motor vehicle (aggregated with associated fringe benefits tax to represent the total employment cost to the
Group). TFR is determined with reference to available market data, the scope of an individual’s role and the qualifications
and experience of the individual, as well as geographic location. TFR is reviewed annually to account for market movements
and individual performance outcomes. See page 53 for a summary of Executive KMP contracts.
40
Hansen Technologies Ltd | Annual Report 2023 (ii) FY23 Short-Term Incentive (STI) Plan
Objective
How is it paid?
How much can
executives earn?
To incentivise and align rewards attainable by Executive KMP with the achievement of specific
annual objectives of the Group and the creation of shareholder value.
Annual cash entitlement on achievement of specific annual financial and non-financial KPIs.
Target benefit is set at 40% of TFR for the Managing Director and 25% of TFR for the CEO and other
Executive KMP. These are subject to the following minimum and target performance thresholds:
How is performance
measured?
% STI awarded
(financial component)
150%
125%
100%
75%
50%
25%
0%
(93% to 97% achievement)
0% to 100% of financial
STI awarded on linear basis
(0% to 93% achievement)
No award
Financial KPIs
(70% total STI)
(97% to 103% achievement)
100% of financial
STI awarded
(103% to a maximum
110% achievement)
100% to 150% of
financial STI awarded
on linear basis
< 80%
85%
90%
95%
100%
105%
110%
115%
>120%
Financial KPI achievement
Non-financial
KPIs
(30% total STI)
Non-financial KPIs are assessed and awarded up to a maximum of 100%
based on specific outcomes.
Performance measures (KPIs) selected reflect financial, strategic and operational objectives
relevant to the level and function of the role that are central to achievement of delivering the best
possible outcome over the next 12 months given the current economic environment. Financial
measures selected are measures against which management and the Board assess the short-term
financial performance of the Group. Strategic and operational objectives are assigned to each
individual to drive specific outcomes considered to be of strategic importance to the Group within
that individual’s level of responsibility. These objectives are determined by the Managing Director
and the Board in accordance with the process set out on page 39.
The weightings for each performance measure that comprise the total STI opportunity are
set out below:
The selection of non-financial
KPIs varies depending on each
KMP’s roles and responsibilities
within the Group. These may
include achievement of specific
strategic projects that drive the
best possible outcome over
the next 12 months. Each KMP
may have a number of separate
non-financial KPIs. Achievement
of each individual’s non-financial
KPIs is determined by reference
to an assigned performance
rating determined by the
Managing Director and the
Board at the end of the financial
year in accordance with the
process described on page 39.
30%
Achievement of financial KPIs
is determined by reference to
the Group’s audited accounts
for the measurement period.
No payment is made in
respect of financial KPIs to
any KMP if the target amount
is not met for the Group
(set at 93% of budgeted
revenue and EBITDA).
70%
Non-financial KPIs
Financial KPIs
(budgeted revenues and EBITDA)
The Board retains final discretion over incentive payments to ensure outcomes appropriately
reflect performance and achieve objectives of the executive incentive scheme.
41
Hansen Technologies Ltd | Annual Report 2023 REMUNERATION REPORT CONTINUED
What happens if an
executive leaves?
Changes from the
FY22 STI Plan
If an eligible executive ceases employment with the Group during the performance period other
than by way of dismissal or resignation (e.g., death, total and permanent disablement, redundancy,
retrenchment or retirement with prior written consent of the Board) then the cash entitlements
will be awarded on a pro-rata basis according to the eligible period of time served up until the
termination date.
Where termination occurs by way of dismissal or resignation prior to the end of the measurement
period, the cash component may be paid on a pro-rata basis.
If termination of employment occurs for serious misconduct all vested and unvested rights will be
forfeited and will lapse.
There have been no changes from the FY22 STI Plan.
(iii) FY23 Long-Term Incentive (LTI) Plan
Objective
To align the rewards attainable by Executive KMP with the achievement of long-term objectives
of the Group and achievement of increasing shareholder value. Eligibility to participate in
the LTI scheme is determined by the Board and is targeted at senior executives whose role
contributes significantly to the performance of the Group.
How is it paid?
LTIs are awarded as performance rights on achievement of certain thresholds reflective of
shareholder value delivered.
Each performance right entitles the eligible executive to be issued with a share.
How much can
executives earn?
Performance rights are subject to the service and performance conditions. The target LTI benefit
is set as follows:
• Managing Director LTI: 50% of TFR delivered as performance rights subject to vesting
conditions; and
• CEO and KMP LTI: 25% of TFR delivered as performance rights subject to vesting conditions.
The number of performance rights issued is based on each Executive’s target LTI benefit divided
by the market value of the rights. The market value of rights granted is based on the volume-
weighted average price of the Company’s shares during the five-day period before grant date.
LTI benefits of up to 150% of target LTI are payable where performance criteria are exceeded.
42
Hansen Technologies Ltd | Annual Report 2023 How is performance
measured?
Vesting of the LTI awards are subject to the following criteria:
1. Three years of continuous employment with the Group from 1 July 2022 to 30 June 2025.
2. Achievement of the thresholds over the same three-year period as set out below:
Relative Total Shareholder
Return (rTSR)
50%
The percentage change in a
company’s share price, plus the
effect of any dividends paid, over
the measurement period, relative
on a ranked percentile basis to
a comparative group (S&P/ASX
Small Ordinaries Index).
Relative TSR directly measures
shareholder value creation.
50%
Relative Total Shareholder
Return (rTSR)
Revenue
Revenue
Based on the achievement of a
compounded annual growth rate
of 12.5% of revenue over the
measurement period.
Revenue growth is selected as it
is considered a relevant indicator
linking financial performance with
shareholder value.
The proportion of rights that may vest based on relative TSR performance is determined based
on the following vesting schedule:
Relative TSR Performance
< 50th percentile
Percentage of Performance Rights That Will
Vest
None
Between 50th to 75th percentile
100% to 150% on a linear basis
> 75th percentile
150%
The proportion of rights that may vest based on Revenue CAGR is determined based on the
following vesting schedule:
Percentage Achievement
Against 12.5% Revenue CAGR
Percentage of Performance Rights That Will
Vest
< 93%
> 93% < 97%
> 97% < 103%
>103% <110%
None
0% to 100% on a linear basis
100%
100% to 150% on a linear basis
The Board has discretion to change the amount awarded if the Board considers the outcome to
be misaligned given the circumstances that prevailed over the relevant measurement period and
the experience of shareholders.
Performance rights will be forfeited if performance and market conditions are not met.
If an eligible executive ceases employment with the Group during the performance period other
than by way of dismissal or resignation (e.g., death, total and permanent disablement, redundancy,
retrenchment or retirement with prior written consent of the Board) then the unvested performance
rights will vest on a pro-rata basis according to the eligible period of time served up until the
termination date.
Where termination occurs by way of dismissal or resignation prior to the vesting of the
performance rights, unvested rights may vest on a pro-rata basis according to the eligible period
of time served up until the termination date at the Board’s discretion.
If termination of employment occurs for serious misconduct all vested and unvested rights will be
forfeited and will lapse.
There have been no changes from the FY22 LTI plan.
43
What happens if
an executive leaves?
Changes from FY22
LTI Plan
Hansen Technologies Ltd | Annual Report 2023 REMUNERATION REPORT CONTINUED
3. How reward is linked to performance
(a) Performance against STI outcomes
A summary of key measurement criteria of the Group’s financial performance for the financial years ended over the last
five financial years is below.
Operating Revenue ($m)
5-year CAGR: 8%
301.4
307.7
296.5
311.8
231.3
2019
2020
2021
2022
2023
350
300
250
200
150
100
50
0
EBITDA ($m)
5-year CAGR: 17%
119.3
100.0
100.7
80.7
53.0
2019
2020
2021
2022
2023
140
120
100
80
60
40
20
0
For FY23, budget targets were established for Group Revenue and underlying EBITDA, and the STI financial payment gate was
set with respect to these targets. During the year, Group Revenue and EBITDA achieved or exceeded the budget targets and,
on a linear basis, the financial payments were paid out at 100% and 140% respectively. Under the STI plan, an STI award of
120.1% to 124.9% of these financial targets was met. For the non-financial goals, 100% of targets were achieved this year
(refer to the table below). Refer to the operational and financial review section of the Directors’ Report for further information
about the Group’s FY23 performance.
Total
Opportunity
$
458,006
–
130,804
141,231
46,508
FY23
Awarded
70%
Financial
124.9%
–
120.1%
120.1%
120.1%
Awarded
30%
KPIs
100.0%
–
100.0%
100.0%
100.0%
Total
Opportunity
$
371,423
110,696
109,177
117,881
–
FY22
Awarded
70%
Financial
100.0%
100.0%
100.0%
100.0%
–
Awarded
30%
KPIs
83.3%
100.0%
87.5%
97.0%
–
Andrew Hansen
Cameron Hunter(1)
Darren Meade
Graeme Taylor
Richard English(2)
(1) Cameron Hunter ceased to be an Executive KMP with effect from 29 July 2022.
(2) Richard English commenced his role as Chief Financial Officer on 22 February 2023 and became an Executive KMP on that date. His total opportunity has
a 50% financial and a 50% non-financial target and is apportioned from the date he became an Executive KMP.
44
Hansen Technologies Ltd | Annual Report 2023 (b) Performance against equity outcomes
All existing incentive plans include equity outcomes that will continue to be measured and reported in the Group’s future
Remuneration Reports.
The following table sets out the different incentive plans with equity outcomes in FY23 and future financial years and their
specific grant details and performance measures:
Grant date
Plan Security Performance Measure/s
2 Sep 2019
FY20 Right
2 Sep 2019
FY20 Right
1 Jul 2020
FY21 Right
15 Sep 2021 FY22 Right
15 Sep 2022 FY23 Right
2-yr cont. employment after
achieving FY20 STI measures(1)
EPSa, rTSR, 3-yr cont.
employment
2-year cont. employment after
achieving FY21 STI measures(2)
Group Revenue, rTSR,
3-yr cont. employment
Group Revenue, rTSR,
3-yr cont. employment
Sect.
3 Ref. Status
(b)(ii)
(b)(i)
(b)(ii)
(b)(iii),
(b)(v)
(b)(iv),
(b)(v)
2020
and prior
2021
2022
2023
2024
2025
(1) Applies to all KMP, except for the Managing Director.
(2) Applies to all KMP, except for the new CFO (KMP).
Key:
Measurement period
150% of EPSa-linked rights and 137% of the rTSR-linked rights vested on 30 June 2022 and exercised on 19 August 2022.
100% of the STI measure-linked rights vested on 30 June 2022 and exercised on 19 August 2022.
135% of the STI measure-linked rights vested on 30 June 2023.
Yet to vest
i. Performance against LTI plan measures (FY20 and FY21 LTI plans)
A summary of key measurement criteria of the Group’s performance relevant for assessing shareholder value creation over
the last four financial years is shown below:
Adjusted EPS (EPSa) (cents)
Dividends paid* (cents per share)
40
35
30
25
20
15
10
5
0
36.7
23.9
29.0
27.5
2020
2021
2022
2023
14
12
10
8
6
4
2
0
12.0
12.0
10.0
6.0
2020
2021
2022
2023
* Amount of dividends paid represents the return on shareholder value. However, the amount of dividends paid is not in itself a performance measure included
in the FY20 to FY21 plans, but is included as part of the calculation of relative TSR.
45
Hansen Technologies Ltd | Annual Report 2023
REMUNERATION REPORT CONTINUED
The chart below highlights the share price performance of Hansen relative to S&P/ASX Small Ordinaries Index for the
previous four years:
180%
160%
140%
120%
100%
80%
60%
40%
20%
0%
July 2019
July 2020
July 2021
July 2022
July 2023
HSN.AX
S&P/ASX Small Ords
Performance outcomes against FY20 LTI plan measures
Performance rights granted under the FY20 LTI plan exceeded the required performance measures in relation to the EPSa
CAGR measure and exceeded the market conditions in relation to the TSR measure. The FY20 LTI plan vested on an
accelerated basis paying 150% of EPSa-linked rights and 137% of TSR-linked rights on 30 June 2022. The performance
rights were subsequently exercised on 19 August 2022.
(ii) Performance against FY20 and FY21 STI plan measures
Performance outcomes against FY20 Deferred STI plan measures
The STI financial payment gate, which was set with respect to Group Revenue and EBITDA coupled with the non-financial KPIs
in the financial year ended 30 June 2020 has been achieved at 100%. The awarding of performance rights was subject to a
two-year deferral period with continuous employment of all Executive KMP, except for the Managing Director. The FY20 STI plan
vested at 100% of the entitlement on 30 June 2022. The performance rights were subsequently exercised on 19 August 2022.
Performance outcomes against FY21 enhanced STI plan measures
The STI financial payment gate, which was set with respect to Group Revenue and EBITDA coupled with the non-financial
KPIs in the financial year ended 30 June 2021 has been achieved at 135%. The enhanced STI plan is based on achievement
of specific annual financial and non-financial KPIs and is subject to a two-year deferral period with continuous employment of
all Executive KMP. Except for the performance rights discussed on Section 8(b)(ii), KMP FY20 STI plan vested at 135% of the
entitlement on 30 June 2023 and was subsequently exercised on 14 August 2023.
(iii) Performance against FY22 LTI plan measures
Performance rights granted in FY22 have performance conditions attached that will be measured over three years. Assessment and
vesting (where conditions are attached) will occur after the completion of FY24, except for the performance rights discussed on
Section 8(b)(ii).
(iv) Performance against FY23 LTI plan measures
Performance rights granted in FY23 have performance conditions attached that will be measured over three years.
46
Hansen Technologies Ltd | Annual Report 2023
(v) Performance rights granted in FY23
The table below sets out the value of LTI performance rights granted in FY23 and FY22 LTI plans.
Andrew Hansen
Darren Meade
Graeme Taylor
Cameron Hunter(2)
Richard English(3)
FY23
FY22
Value Granted(1) $
353,337
83,088
89,711
–
22,152
371,870
87,445
94,416
88,662
–
(1) Represents the value of performance rights at grant date, calculated in accordance with AASB 2 Share-based Payment. The fair value of the rights has been
determined by an independent external valuation expert in accordance with Australian Accounting Standards. The fair value of the LTI rights was based on
Monte Carlo simulation option pricing model for the TSR component and BSOPM for the Group Revenue component. Note 17(b) to the Group’s financial
statements outlines the valuation methodology and key inputs and assumptions to the valuation in greater detail.
(2) Cameron Hunter ceased to be a KMP with effect from 29 July 2022.
(3) Richard English commenced as an Executive KMP on 22 February 2023. The numbers presented above reflect the apportioned value granted when
he commenced as an Executive KMP.
(c) Total remuneration mix
The following diagrams set out the proportional mix of remuneration for the Managing Director and KMP at both the target
amount and the actual remuneration achieved for FY23:
TARGET(1)
ACTUAL(1)
Managing
Director(2)
29%
20%
32%
Short-Term Incentive
Total Fixed Remuneration
71%
68%
22%
KMP
Short-Term Incentive
Total Fixed Remuneration
80%
78%
(1) Target and actual remuneration mix is calculated based on the combination of each Managing Director and KMP’s total fixed remuneration for FY23 and the value
of STIs awarded in relation to actual performance outcomes for FY23 in cash.
(2) Actual remuneration for FY23 refers to the remuneration of the Managing Director and former CEO, Andrew Hansen. On 19 June 2023, he transitioned the
operational tasks to Graeme Taylor who was promoted to CEO. The current CEO’s actual remuneration is included under KMP.
47
Hansen Technologies Ltd | Annual Report 2023 REMUNERATION REPORT CONTINUED
4. Remuneration details: Executive KMP
(a) Statutory remuneration details
Details of Executive KMP remuneration for the 2023 and 2022 financial years are set out in the table below:
Fixed Remuneration
Variable
Remuneration
Total
49%
48%
0%
43%
33%
33%
33%
33%
27%
0%
35%
42%
Executive KMP
Year
Cash
Salary
$
Andrew Hansen
2023
930,003
2022
Cameron Hunter(3) 2023
2022
Darren Meade
Graeme Taylor
Richard English(4)
2023
2022
2023
2022
2023
2022
895,630
185,766
427,863
441,028
421,847
478,799
457,272
176,595
–
Super
$
27,500
27,500
–
27,500
27,500
27,500
27,500
27,500
272
–
Non-
monetary
Benefits
$
Annual
& Long
Service
Leave
$
STI(1)(2)
Awarded
$
LTI(2) Fair
Value
$
Total
$
Perfor-
mance
Related
%
Total
$
2,342
(33,294) 926,551
649,876
241,735 1,818,162
30,722
44,962
998,814
544,722
386,998 1,930,534
–
363,097
548,863
–
–
548,863
14,444
(20,351) 449,456
205,023
135,119
789,598
2,791
(5,466) 465,853
173,369
56,844
696,066
–
15,464
464,811
157,305
75,831
697,947
26,973
(37,885) 495,387
182,024
61,376
738,787
–
–
–
4,445
489,217
166,867
76,211
732,295
(1,114) 175,753
44,512
21,435
241,700
–
–
–
–
–
Total
2023 2,212,191
82,772
32,106
285,338 2,612,407 1,049,781
381,390 4,043,578
2022 2,202,612
110,000
45,166
44,520 2,402,298 1,073,917
674,159 4,150,374
(1) Represents STI awarded and accrued in relation to actual performance during the 2023 and 2022 financial years. This includes performance rights granted
as remuneration that are valued at grant date in accordance with AASB 2 Share-based Payment and are amortised over the vesting period.
(2) Performance rights granted as remuneration are valued at grant date in accordance with AASB 2 Share-based Payment and are amortised over the vesting period.
(3) Cameron Hunter ceased to be an Executive KMP with effect from 29 July 2022. A total of $548,863 of termination benefits was paid during the financial year.
(4) Richard English commenced as an Executive KMP on 22 February 2023. The numbers presented above reflect his remuneration from when he commenced
his role as an Executive KMP.
48
Hansen Technologies Ltd | Annual Report 2023 (b) Performance rights awarded, vested and lapsed during the year
Performance rights issued under the Group’s FY23 LTI plan during the year are subject to the service and performance criteria
as described on pages 42 to 43.
The following table sets out details of performance rights granted to executives:
Name and Grant Date
Andrew Hansen
15 Sep 2022*
15 Sep 2021
1 Jul 2020
2 Sep 2019
Sub-total
Graeme Taylor
15 Sep 2022
15 Sep 2021
1 Jul 2020
2 Sep 2019
2 Sep 2019
Sub-total
Darren Meade
15 Sep 2022
15 Sep 2021
1 Jul 2020
2 Sep 2019
2 Sep 2019
Sub-total
Cameron Hunter(4)
15 Sep 2021
1 Jul 2020
2 Sep 2019
2 Sep 2019
Sub-total
Richard English(5)
15 Sep 2022
15 Sep 2021
1 Jul 2020
Sub-total
Sub-total
Sub-total
Grand Total
Plan
FY23
FY22
FY21
FY20
FY23
FY22
FY21
FY20
FY20
FY23
FY22
FY21
FY20
FY20
FY22
FY21
FY20
FY20
FY23
FY22
FY21
Type
LTI
LTI
STI(1)
LTI(3)
LTI
LTI
STI(1)
STI(2)
LTI(3)
LTI
LTI
STI(1)
STI(2)
LTI(3)
LTI
STI(1)
STI(2)
LTI(3)
LTI
LTI
LTI
STI(1),(2)
LTI(3)
Opening
Balance
Vested,
Exercised and
Other Changes
Closing
Balance at
30 June 2023
Granted
–
74,523
213,189
172,156
459,868
–
18,921
45,325
8,927
29,281
102,454
–
17,524
47,295
9,315
30,553
104,687
17,768
47,065
9,270
30,405
104,508
–
–
–
–
380,386
391,131
771,517
94,475
–
–
–
94,475
23,987
–
–
–
–
23,987
22,216
–
–
–
–
22,216
–
–
–
–
–
5,923
–
–
5,923
–
146,601
146,601
–
–
–
(172,156)
(172,156)
–
–
–
(8,927)
(29,281)
(38,208)
–
–
–
(9,315)
(30,553)
(39,868)
(17,768)
(47,065)
(9,270)
(30,405)
(104,508)
14,002
10,485
20,408
44,895
(74,577)
(235,268)
(309,845)
94,475
74,523
213,189
–
382,187
23,987
18,921
45,325
–
–
88,233
22,216
17,524
47,295
–
–
87,035
–
–
–
–
–
19,925
10,485
20,408
50,818
305,809
302,464
608,273
* The Board has resolved to issue 94,475 rights to Andrew Hansen, the Managing Director and an additional 47,238 rights on overachievement of targets, as part
of the 2022 LTI plan issued in FY23. The issuance of these rights was approved by shareholders at the Company’s Annual General Meeting on 24 November 2022.
Any differences in the fair value of the performance rights between the original grant date by the Board and the date of shareholder approval is not material to the
remuneration awarded.
(1) STI performance rights granted on 1 July 2020 represent 56% and 50% of the total short-term incentives awarded to the Managing Director and the rest of the
KMP, respectively on achievement of specific annual financial and non-financial KPIs. The performance rights have exceeded the required specific annual financial
and non-financial KPIs and will vest on an accelerated basis, subject to a two-year deferral period paying 135% of the entitlement on 30 June 2023.
(2) STI performance rights granted on 2 September 2019 represent 25% of the total short-term incentives awarded to the CEO and all of the KMP, except for the
Managing Director on achievement of specific annual financial and non-financial KPIs. The performance rights met the required specific annual and non-financial
KPIs and two-year deferral period and vested at 100% on 30 June 2022. The rights have been subsequently exercised on 19 August 2022.
(3) Performance rights in relation to the EPSa CAGR and TSR measures for FY20 LTI plan exceeded the required performance measurement hurdles and market
conditions, respectively and vested on an accelerated basis paying 150% of the entitlement on rights linked to EPSa CAGR measure and 137% of the entitlement
on rights linked to TSR measure on 30 June 2022. The rights have been subsequently exercised on 19 August 2022.
(4) Cameron Hunter, former Chief Operating Officer ceased to be an Executive KMP with effect from 29 July 2022.
(5) Richard English commenced as an Executive KMP on 22 February 2023. The balance presented above include 44,895 rights, which were held prior to his
commencement of his new role as an Executive KMP.
49
Hansen Technologies Ltd | Annual Report 2023 REMUNERATION REPORT CONTINUED
The terms and conditions of each grant of rights affecting the remuneration in the current or future reporting period
are as follows:
Grant Date
Vesting Date
1 Jul 2020
30 Jun 2023
15 Sep 2022
30 Jun 2024
15 Sep 2022
30 Jun 2025
Value Per Right
at Grant Date
Performance
Achieved
$2.70
$4.99
$3.74
135%
–
–
Type
STI(1)
LTI
LTI
% Vested
135%
–
–
Number of Rights
on 30 June 2023
305,809
110,968
146,601
(1) STI performance rights granted on 1 July 2020 have exceeded the required specific annual financial and non-financial KPIs and vested on an accelerated basis
paying 135% of the entitlement on 30 June 2023. These rights were exercised on 14 August 2023.
5. FY24 Incentive Plan
(a) Short-Term Incentive Plan
Objective
How is it paid?
How much can
executives earn?
To incentivise and align rewards attainable by Executive KMP with the achievement of specific
annual objectives of the Group and the creation of shareholder value.
Annual cash entitlement on achievement of specific annual financial and non-financial KPIs.
Target benefit is set at 40% of TFR for the Managing Director, 40% of TFR for the CEO and
25% of TFR for other Executive KMP. These are subject to the following minimum and target
performance thresholds:
% STI awarded
(financial component)
150%
125%
100%
75%
50%
25%
0%
(93% to 97% achievement)
0% to 100% of financial
STI awarded on linear basis
(0% to 93% achievement)
No award
Financial KPIs
(70% total STI)
(97% to 103% achievement)
100% of financial
STI awarded
(103% to a maximum
110% achievement)
100% to 150% of
financial STI awarded
on linear basis
< 80%
85%
90%
95%
100%
105%
110%
115%
>120%
Financial KPI achievement
Non-financial
KPIs
(30% total STI)
Non-financial KPIs are assessed and awarded up to a maximum
of 100% based on specific outcomes.
50
Hansen Technologies Ltd | Annual Report 2023 How is performance
measured?
Performance measures (KPIs) selected reflect financial, strategic and operational objectives relevant
to the level and function of the role that are central to achievement of delivering the best possible
outcome over the next 12 months given the current economic environment. Financial measures
selected are measures against which management and the Board assess the short-term financial
performance of the Group. Strategic and operational objectives are assigned to each individual
to drive specific outcomes considered to be of strategic importance to the Group within that
individual’s level of responsibility. These objectives are determined by the Managing Director
and the Board in accordance with the process set out on page 39.
The weightings for each performance measure that comprise the total STI opportunity are
set out below:
The selection of non-financial
KPIs varies depending on each
KMP’s roles and responsibilities
within the Group. These may
include achievement of specific
strategic projects that drive the
best possible outcome over
the next 12 months. Each KMP
may have a number of separate
non-financial KPIs. Achievement
of each individual’s non-financial
KPIs is determined by reference
to an assigned performance
rating determined by the
Managing Director and the
Board at the end of the financial
year in accordance with the
process described on page 39.
30%
Achievement of financial KPIs
is determined by reference to
the Group’s audited accounts
for the measurement period.
No payment is made in respect
of financial KPIs to any KMP
if the target amount is not
met for the Group (set at
93% of budgeted revenue
and EBITDA).
70%
Non-financial KPIs
Financial KPIs
(budgeted revenues and EBITDA)
The Board retains final discretion over incentive payments to ensure outcomes appropriately
reflect performance and achieve objectives of the executive incentive scheme.
If an eligible executive ceases employment with the Group during the performance period other
than by way of dismissal or resignation (e.g., death, total and permanent disablement, redundancy,
retrenchment or retirement with prior written consent of the Board) then the cash entitlements
will be awarded on a pro-rata basis according to the eligible period of time served up until the
termination date.
Where termination occurs by way of dismissal or resignation prior to the end of the measurement
period, the cash component may be paid on a pro-rata basis.
If termination of employment occurs for serious misconduct all vested and unvested rights will be
forfeited and will lapse.
There have been no changes from the FY23 STI Plan.
What happens if
an executive leaves?
Changes from the
FY23 STI Plan
(b) Long-Term Incentive Plan
Objective
To align the rewards attainable by Executive KMP with the achievement of long-term strategic
and financial objectives of the Group that are directly aligned with increasing shareholder value.
Eligibility to participate in the LTI scheme is determined by the Board and is targeted at senior
executives whose role contributes significantly to the performance of the Group.
How is it paid?
LTIs are awarded as performance rights on achievement of certain thresholds reflective of
shareholder value delivered.
Each performance right entitles the eligible executive to be issued with a share.
51
Hansen Technologies Ltd | Annual Report 2023 REMUNERATION REPORT CONTINUED
How much can
executives earn?
Performance rights are subject to the service and performance conditions. The target LTI benefit
is set as follows:
• Managing Director LTI: 50% of TFR delivered as performance rights subject to vesting
conditions;
• CEO LTI: 50% of TFR delivered as performance rights subject to vesting conditions; and
• KMP LTI: 25% of TFR delivered as performance rights subject to vesting conditions.
The number of performance rights issued is based on each Executive’s target LTI benefit divided
by the market value of the rights. The market value of rights granted is based on the volume-
weighted average price of the Company’s shares during the five-day period before grant date.
LTI benefits of up to 150% of target LTI are payable where performance criteria are exceeded.
Vesting of the LTI awards are subject to the following criteria:
1. Three years of continuous employment with the Group from 1 July 2022 to 30 June 2025.
2. Adherence with appropriate malus provisions over the measurement period.
3. Satisfaction of key hurdles including minimum Revenue CAGR and achievement of minimum
EBITDA margins across the three years.
4. Achievement of the thresholds over the same three-year period as set out below:
Group Organic Revenue
Growth
50%
Achievement of minimum Organic
Revenue Growth targets across the
three-year period.
Organic Revenue Growth is a
transparent, metric that drives
sustainable performance.
It motivates executives to prioritise
customer relationships, product
improvement, and operational
efficiency for long-term sustainable
revenue streams.
50%
Group Organic Revenue Growth
Group EBITDA Growth
Group EBITDA Growth
Achievement of minimum
EBITDA Growth targets across
the three-year period.
EBITDA growth drives efficiency
and sustainable cash flow
performance. It evaluates
KMP consistently, enhances
shareholder value, and supports
and encourages Hansen’s long-
term success.
The proportion of rights that may vest based on both the Organic Revenue Growth and EBITDA
growth targets is determined based on the following vesting schedule:
Percentage achievement against
Revenue and EBITDA targets
Percentage of Performance Rights That Will
Vest
< 93%
> 93% < 97%
> 97% < 103%
>103% <110%
None
0% to 100% on a linear basis
100%
100% to 150% on a linear basis
The Board has discretion to change the amount awarded if the Board considers the outcome to be
misaligned given the circumstances that prevailed over the relevant measurement period and the
experience of shareholders.
Performance rights will be forfeited if performance conditions are not met.
How is performance
measured?
52
Hansen Technologies Ltd | Annual Report 2023 What happens if an
executive leaves?
Changes from the
FY23 LTI Plan
If an eligible executive ceases employment with the Group during the performance period other
than by way of dismissal or resignation (e.g., death, total and permanent disablement, redundancy,
retrenchment or retirement with prior written consent of the Board) then the unvested performance
rights will vest on a pro-rata basis according to the eligible period of time served up until the
termination date.
Where termination occurs by way of dismissal or resignation prior to the vesting of the performance
rights, unvested rights may vest on a pro-rata basis according to the eligible period of time served
up until the termination date at the Board’s discretion.
If termination of employment occurs for serious misconduct all vested and unvested rights will be
forfeited and will lapse.
The FY24 LTI scheme replaces the previous two LTI measurements of Relative Total Shareholder
Return (rTSR) and 12.5% Revenue CAGR and introduces two new financial measurement
criterion, achievement of Board defined three-year cumulative organic revenue and EBITDA
growth targets.
6. Contractual arrangements with Executive KMP
Remuneration and other conditions of employment are set out in each executive’s employment contract. The key elements
of these employment contracts are summarised below:
Component
Total Fixed Remuneration Range between $727,500 and $975,000(1)
Contract duration
Approach for Managing Director and CEO
Ongoing
Approach for Other Executive KMP
Range between $465,000 and $496,000
Ongoing
1 – 3 months
6 months
Notice by
individual/company
Termination of employment
(without cause)
The Board has discretion to allow some or all STI entitlements to be paid out on a pro-rata basis
aligned to time, where termination occurs by way of resignation or dismissal (e.g., death, total and
permanent disablement, redundancy, retrenchment or retirement with prior written consent of the
Board).
In other forms of without cause terminations, the STI will be reduced proportionately to reflect the
portion of the Measurement Period, but there is no other impact to the executive’s entitlement.
The Board has discretion to allow unvested LTIs to vest on a pro-rata basis aligned to time. Where
this discretion is not exercised, such unvested rights will lapse.
Termination of employment
(with cause)
STI is forfeited.
All unvested LTIs are forfeited.
All vested but unexercised LTIs are forfeited.
(1) With effect from 19 June 2023, Andrew Hansen transitioned the operational tasks to Graeme Taylor, who was promoted to Chief Executive Officer.
Andrew Hansen has remained as Managing Director.
53
Hansen Technologies Ltd | Annual Report 2023 REMUNERATION REPORT CONTINUED
7. Remuneration details: Non-Executive KMP
Non-Executive Directors enter into service agreements through a letter of appointment. Non-Executive Director fees are
determined with reference to market levels and the need to attract high quality Directors.
Non-Executive Directors do not receive any variable or performance-based remuneration.
The Non-Executive Director fee pool currently has a maximum value of $780,000 per annum, as approved by shareholders
at the 2022 AGM and received strong support with a vote of 98.27% in favour.
The annual fees provided to Non-Executive Directors, inclusive of superannuation, are shown below:
Board fees
Chairman
Other Non-Executive Directors
Committee fees
Audit and Risk Committee – chair
Audit and Risk Committee – member
Remuneration Committee – chair
Remuneration Committee – member
Non-Executive Director
David Trude
Bruce Adams
Lisa Pendlebury
Don Rankin
David Osborne
David Howell(1)
Total
2023
($)
2022
($)
158,076
89,485
149,800
84,800
9,000
5,000
9,000
5,000
9,000
5,000
9,000
5,000
Fixed Remuneration
Super
($)
15,014
14,982
9,000
8,845
9,728
2,570
9,902
10,345
9,000
8,845
14,654
11,709
67,298
57,296
Total
($)
158,005
164,800
94,718
97,299
102,377
28,267
104,211
113,799
94,718
97,299
154,212
128,800
708,241
630,264
Salary and Fees
($)
142,991
149,818
85,718
88,454
92,649
25,697
94,309
103,454
85,718
88,454
139,558
117,091
640,943
572,968
Year
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
(1) During the year, David Howell was paid an extra $30,000 for consulting services performed for the Company.
54
Hansen Technologies Ltd | Annual Report 2023 8. Share-based remuneration disclosures
(a) Shareholdings of KMP
The number of shares in the Company held by each Non-Executive Director and Executive KMP during the year, including their
related parties, is summarised below:
Received
During the Year
on Exercise of
Performance
Rights
Balance
30 June 2022
Other Changes
During the Year
Balance
30 June 2023
Non-Executive Directors
David Trude
Bruce Adams(1)
Lisa Pendlebury
Don Rankin
David Osborne(1)
David Howell
Executive KMP
Andrew Hansen(1)
Graeme Taylor
Darren Meade
Richard English(2)
Cameron Hunter(3)
Joint interest(1)
Total
109,388
34,891,417
7,419
25,000
35,125,448
33,290
35,277,917
244,214
150,193
–
1,274,413
(69,478,226)
37,660,473
–
–
–
–
–
–
172,156
38,208
39,868
–
2,290
111,678
–
34,891,417
6,450
–
–
10,515
13,869
25,000
35,125,448
43,805
–
35,450,073
4,981
(100,286)
29,599
287,403
89,775
29,599
–
104,508
(1,378,921)
–
–
(69,478,226)
354,740
(1,425,372)
36,589,841
(1) Each of Bruce Adams, David Osborne and Andrew Hansen has a joint interest in a single parcel of 34,739,113 shares as at the date of this report.
(2) Richard English commenced as an Executive KMP on 22 February 2023. The closing balance disclosed reflects the numbers held when he commenced
as an Executive KMP.
(3) Cameron Hunter ceased to be a KMP with effect from 29 July 2022.
(b) Shares issued on exercise of performance rights
On 24 June 2022, the Group established the Hansen Technologies Limited Employee Share Plan Trust (Trust) to hold shares for
satisfaction of rights under existing future equity awards plans. The establishment of the Trust impacts FY20 LTI and STI equity
awards plans onwards.
(i) FY20 LTI and STI plan
On 30 June 2022, the FY20 plan vested. The performance rights were subsequently exercised on 19 August 2022. A total
of 289,907 shares were issued to the Executive KMP on that date. Refer to Section 3(b)(i) Performance outcomes against
FY20 LTI plan measures and Section 3(b)(ii) Performance outcomes against FY20 STI plan measures.
The share price as at the exercise date, 19 August 2022 was $5.84 per share.
55
Hansen Technologies Ltd | Annual Report 2023 REMUNERATION REPORT CONTINUED
The below table sets out the value of performance rights under the FY20 LTI and STI plan that were exercised.
STI
Cameron Hunter(2)
Darren Meade
Graeme Taylor
LTI
Andrew Hansen
Cameron Hunter
Darren Meade
Graeme Taylor
Number of
Shares Issued
Value
Exercised(1)
$
9,270
9,315
8,927
172,156
30,405
30,553
29,281
54,137
54,400
52,134
1,005,391
177,565
178,430
171,001
(1) Represents the intrinsic value of performance rights that were exercised during the financial year 2023 up to the date of the remuneration report, which is the value
of shares at the date of the exercise.
(2) Cameron Hunter ceased to be a KMP with effect from 29 July 2022.
(ii) Performance rights exercised under the discretion of the Board of Directors
On 29 July 2022, Cameron Hunter (Chief Operating Officer), an Executive KMP, was made redundant. In relation to his rights
that were yet to vest on this date, the Board of Directors exercised its discretionary power under the Employee Rights Plan and
allowed these rights to be retained; and to vest. These rights were exercised on 19 August 2022 and the below table sets out
the value of these rights:
FY21 Enhanced STI Plan
FY22 LTI Plan
Number of
Shares Issued
47,065
17,768
Value
Exercised*
$
274,860
103,765
* Represents the intrinsic value of performance rights that were exercised during the financial year 2023 up to the date of the remuneration report, which is the value
of shares at the date of the exercise.
On 30 June 2023, the FY21 plan vested. The performance rights were subsequently exercised on 14 August 2023. A total
of 326,217 shares were issued to the Executive KMP on that date. Refer to Section 3(b)(ii) Performance outcomes against
FY21 STI plan measures.
The share price as at the exercise date, 14 August 2023 was $5.30 per share.
The below table sets out the value of performance rights under the FY21 LTI and STI plan that were exercised.
STI and LTI
Andrew Hansen
Darren Meade
Graeme Taylor
Richard English
Number of
Shares Issued
213,189
47,295
45,325
20,408
Value
Exercised*
$
1,129,902
250,664
240,223
108,162
* Represents the intrinsic value of performance rights that were exercised during the financial year 2023 up to the date of the remuneration report, which is the value
of shares at the date of the exercise.
56
Hansen Technologies Ltd | Annual Report 2023 9. Other transactions with KMP
Rental agreements with the Managing Director and other KMP
The Group leased its Melbourne head office and its York Street (South Melbourne) office from entities in which the Managing
Director is a Director up until 29 July 2022 and 17 June 2022, respectively. These properties were sold to non-related parties
during these dates. In addition, the Group rents an apartment in New York City, USA, on an as-required basis at a rate
favourable to the Group. The apartment is owned by the Managing Director. The terms and conditions of the lease and other
property arrangements are no more favourable than those available, or which might reasonably be expected to be available,
from others on an arm’s length basis.
The total lease and rental payments during the 2023 financial year related to these arrangements were $40,713.
Bruce Adams and David Osborne held a joint indirect interest in the entity that is a lessor to the Melbourne and South Melbourne
arrangements as described above. The transactions relating to the Group’s Melbourne head office and South Melbourne
property have ceased to be related party transactions of the Group from the date when these properties were sold to
non-related parties.
The terms and conditions of the current lease arrangements remain unchanged during the financial year.
10. Employee Share Trust
Hansen Technologies Limited Employee Share Plan Trust (the Trust) was established on 24 June 2022 as a sole purpose
trust for the purpose of holding shares for the satisfaction of rights under existing and future equity awards plans. The Trust
provides Hansen with greater flexibility to accommodate the incentive arrangements of Hansen both now and into the future
as the Group continues to expand its operations. The Trust will help manage the capital requirements, in that the Trust can use
the contributions made by Hansen either to acquire shares in Hansen on market, or alternatively to subscribe for new shares
in Hansen. In addition, the Trust provides an arm’s length vehicle through which shares in Hansen can be acquired and held
in Hansen on behalf of employees and allows Hansen to satisfy corporations law requirements relating to companies dealing
in their own shares, as well as assisting with management of insider trading restrictions. Pacific Custodians Pty Limited, an
independent third party, is the Trustee of the Trust, and will operate the Trust in accordance with Hansen Technologies Limited
Employee Share Plan Trust Deed.
Signed in accordance with a resolution of the Directors.
David Trude
Chair
Melbourne
23 August 2023
Andrew Hansen
Managing Director
57
Hansen Technologies Ltd | Annual Report 2023
AUDITOR’S INDEPENDENCE DECLARATION
RSM Australia Partners
Level 21, 55 Collins Street Melbourne VIC 3000
PO Box 248 Collins Street West VIC 8007
T +61 (0) 3 9286 8000
F +61 (0) 3 9286 8199
www.rsm.com.au
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the financial report of Hansen Technologies Limited and its controlled entities for
the year ended 30 June 2023, I declare that, to the best of my knowledge and belief, there have been no
contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii)
any applicable code of professional conduct in relation to the audit.
RSM AUSTRALIA PARTNERS
M PARAMESWARAN
Partner
Dated: 23 August 2023
Melbourne, Victoria
THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network
is an independent accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
58
Hansen Technologies Ltd | Annual Report 2023
FINANCIAL REPORT
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Section A: Basis of preparation
1. Basis of preparation
Section B: Performance
2. Segment information
3. Revenue and other income
4. Separately disclosed items
5. Profit from continuing operations
6.
7. Earnings per share
Income tax
Section C: Working Capital and Operating Assets
8. Cash and cash equivalents
9. Receivables
10. Other assets
11. Plant, equipment and leasehold improvements
12. Intangible assets
13. Leases
14. Payables
15. Other operating provisions
60
61
62
63
64
64
64
66
66
70
74
75
76
79
80
80
81
82
83
84
87
92
93
Section D: People
16. Employee benefits
17. Share-based payments
94
94
96
Section E: Capital and Financial Risk Management 100
18. Financial risk management
19. Borrowings
20. Contributed capital
21. Dividends
22. Reserves and retained earnings
23. Commitments and contingencies
Section F: Group Structure
24. Parent entity information
Section G: Other Disclosures
25. Related party disclosures
26. Auditor’s remuneration
27. Deed of cross guarantee
28. New and amended accounting
standards and interpretations
29. Subsequent events
Directors’ Declaration
Independent Auditor’s Report
ASX Shareholder Information
Corporate Directory
100
103
105
106
107
107
108
108
110
110
112
113
115
116
117
118
122
124
Hansen Technologies Ltd
| Annual Report 2023
59
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023
Operating revenue
Other income
Total revenue and other income
Employee benefit expenses
Depreciation expense
Amortisation expense
Property and operating rental expenses
Contractor and consultant expenses
Software licence expenses
Hardware and software expenses
Travel expenses
Communication expenses
Professional expenses
Finance costs on borrowings
Finance costs on lease liabilities
Foreign exchange gains/(losses)
Other expenses
Total expenses
Profit before income tax expense
Income tax expense
Note
3
3
5
5
5
5
5
5
5
2023
$’000
311,766
3,458
315,224
(166,878)
(11,031)
(33,269)
(3,678)
(5,928)
(2,697)
(21,373)
(2,257)
(1,847)
(5,158)
(4,115)
(772)
2,741
(4,637)
2022
$’000
296,545
848
297,393
(154,923)
(9,973)
(32,144)
(3,635)
(5,707)
(2,168)
(19,663)
(1,086)
(1,888)
(4,954)
(3,641)
(854)
(2,358)
(3,359)
(260,899)
(246,353)
6(a)
54,325
(11,530)
51,040
(9,100)
Net profit after income tax expense
42,795
41,940
Other comprehensive income/(expense)
Items that may be reclassified subsequently to profit and loss
Net gain on hedges of net investments
Exchange differences on translation of foreign entities, net of tax
Other comprehensive income/(expense) for the year, net of tax
Total comprehensive income for the year
Basic earnings (cents) per share attributable to ordinary
equity holders of the Company
Diluted earnings (cents) per share attributable to ordinary
equity holders of the Company
22(a)
22(a)
7
7
–
(277)
(277)
26
2,405
2,431
42,518
44,371
21.1
20.9
20.8
20.6
The consolidated statement of comprehensive income is to be read in conjunction with the notes to the financial statements
set out on pages 64 to 116.
60
Hansen Technologies Ltd | Annual Report 2023 CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
Current assets
Cash and cash equivalents
Receivables
Accrued revenue
Current tax receivable
Other current assets
Total current assets
Non-current assets
Plant, equipment & leasehold improvements
Intangible assets
Right-of-use assets
Deferred tax assets
Other non-current assets
Total non-current assets
Total assets
Current liabilities
Payables
Lease liabilities
Current tax payable
Provisions
Unearned revenue
Total current liabilities
Non-current liabilities
Deferred tax liabilities
Borrowings
Lease liabilities
Provisions
Unearned revenue
Total non-current liabilities
Total liabilities
Net assets
Equity
Share capital
Foreign currency translation reserve
Share-based payments reserve
Retained earnings
Total equity
Note
8
9
3(a)(ii)
10
11
12
13(a)
6(b)
10
14
13(b,e)
15, 16
3(a)(ii)
6(b)
19
13(b)
15, 16
3(a)(ii)
20
22(a)
22(b)
22(c)
2023
$’000
2022
$’000
54,279
57,152
28,319
–
7,303
147,053
15,051
332,820
13,648
6,581
1,434
59,631
56,010
21,657
2,924
9,048
149,270
14,444
344,475
12,968
7,781
1,889
369,534
381,557
516,587
530,827
25,028
5,434
509
14,127
32,854
77,952
33,960
54,309
9,563
409
1,514
99,755
23,989
5,662
–
14,990
36,821
81,462
35,588
87,912
8,213
514
4,030
136,257
177,707
217,719
338,880
313,108
148,688
7,259
12,285
170,648
338,880
146,857
7,536
10,629
148,086
313,108
The consolidated statement of financial position is to be read in conjunction with the notes to the financial statements set out
on pages 64 to 116.
61
Hansen Technologies Ltd | Annual Report 2023 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
Balance as at 1 July 2022
Net profit after income tax expense for the year
Exchange differences on translation of foreign entities, net
of tax
Total comprehensive income for the year
Transactions with owners in their capacity as owners:
Share-based payment expense – performance rights
Tax associated with employee share-based plans
Equity issued under dividend reinvestment plan
Dividends declared
Total transactions with owners in their capacity as owners
Note
22(c)
22(a)
17(c)
6(b)(iv)
20(b)
22(c)
Balance as at 30 June 2023
20, 22
148,688
Contributed
Equity
$’000
146,857
–
Reserves
$’000
18,165
–
Retained
Earnings
$’000
148,086
42,795
Total Equity
$’000
313,108
42,795
–
–
–
–
1,831
–
1,831
(277)
(277)
–
(277)
42,795
42,518
1,528
128
–
–
1,656
19,544
–
–
–
(20,233)
(20,233)
1,528
128
1,831
(20,233)
(16,746)
170,648
338,880
Balance as at 1 July 2021
Net profit after income tax expense for the year
Net gain on hedges of net investments
Exchange differences on translation of foreign entities,
net of tax
Total comprehensive income for the year
Transactions with owners in their capacity as owners:
Share-based payment expense – performance rights
Tax associated with employee share-based plans
Equity issued under dividend reinvestment plan
Dividends declared
Total transactions with owners in their capacity as owners
Balance as at 30 June 2022
Contributed
Equity
$’000
145,224
–
–
–
–
–
–
1,633
–
1,633
146,857
Note
22(c)
22(a)
22(a)
17(c)
6(b)(iv)
20(b)
22(c)
20, 22
Reserves
$’000
13,076
–
26
2,405
2,431
2,437
221
–
–
2,658
18,165
Retained
Earnings
$’000
130,219
41,940
–
–
41,940
–
–
–
(24,073)
(24,073)
Total Equity
$’000
288,519
41,940
26
2,405
44,371
2,437
221
1,633
(24,073)
(19,782)
148,086
313,108
The consolidated statement of changes in equity is to be read in conjunction with the notes to the financial statements set out
on pages 64 to 116.
62
Hansen Technologies Ltd | Annual Report 2023 CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2023
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Finance costs on borrowings
Finance costs on lease liabilities
Income tax paid
Net cash inflow from operating activities
Cash flows from investing activities
Payments for plant, equipment and leasehold improvements
Proceeds from disposal of non-financial assets
Payments for capitalised software development costs
Net cash outflow from investing activities
Cash flows from financing activities
Repayment of borrowings
Establishment of loan fees
Repayment of lease liabilities
Dividends paid, net of dividend re-investment
Net cash outflow from financing activities
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Effects of exchange rate changes on cash and cash equivalents
Note
2023
$’000
2022
$’000
3
5
5,13(b)
8(a)
11
12
19(a)
19(a)
13(d)
21
331,672
(240,116)
110
(3,964)
(772)
(8,108)
78,822
(4,757)
–
(21,140)
(25,897)
(33,615)
(201)
(6,188)
(18,403)
(58,407)
(5,482)
59,631
130
353,917
(235,627)
63
(2,049)
(854)
(24,219)
91,231
(6,015)
105
(15,604)
(21,514)
(33,574)
(400)
(5,996)
(22,440)
(62,410)
7,307
52,138
186
Cash and cash equivalents at end of the year
8
54,279
59,631
The consolidated statement of cash flows is to be read in conjunction with the notes to the financial statements set out
on pages 64 to 116.
63
Hansen Technologies Ltd | Annual Report 2023 SECTION A: BASIS OF PREPARATION
This section describes the basis in which the Group’s financial statements are prepared. Specific accounting policies
are described in the note to which they relate. The accounting policies have been consistently applied, unless
otherwise stated.
1. Basis of preparation
(a) Basis of preparation of the Financial Report
This Financial Report is a general purpose Financial Report that has been prepared in accordance with Australian Accounting
Standards, Interpretations and other applicable authoritative pronouncements of the Australian Accounting Standards Board
and the Corporations Act 2001.
The Financial Report covers the Group, being Hansen Technologies Limited (“the Company”) and its controlled entities as
a consolidated entity. The Company is a company limited by shares, incorporated and domiciled in Australia. The address
of the Company’s registered office and principal place of business is Level 2, 31 Queen Street, Melbourne, Victoria 3000.
The Company is a for-profit entity for the purposes of preparing the Group’s financial statements.
This Financial Report was authorised for issue by the Directors on 23 August 2023.
The Group’s consolidated financial statements have been presented in a streamlined manner to simplify the information disclosed
and to make it more relevant for users. Similar notes have been grouped into sections with relevant accounting policies, judgements
and estimate disclosures incorporated within the notes to which they relate.
Compliance with IFRS
The Group’s consolidated financial statements comply with the International Financial Reporting Standards (IFRS) as issued
by the International Accounting Standards Board (IASB).
Historical cost convention
The Financial Report has been prepared under the historical cost convention, as modified by revaluations to fair value for certain
classes of assets and liabilities as described in the accounting policies.
Significant accounting estimates and judgements
The preparation of the Financial Report requires the use of certain estimates and judgements in applying the Group’s accounting
policies. The Group makes certain estimates and assumptions concerning the future which, by definition, will seldom represent
actual results. Estimates and assumptions based on future events have a significant inherent risk and where future events are
not as anticipated, there could be a material impact on the carrying amounts of the assets and liabilities discussed in each
of the affected notes.
Those estimates and judgements significant to the Financial Report are disclosed in the following notes:
Significant Accounting Estimate and Judgement
Provision for expected credit losses of trade receivables
Capitalisation of research and development costs
Impairment of goodwill
Impairment of non-financial assets other than goodwill
Determining the lease term of contracts with renewal and termination options – Group as a
lessee
Estimating the incremental borrowing rate
Share-based payments
Note Page Reference
9
12
12
12
13
13
17
82
86
87
85
92
92
99
64
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 (b) Principles of consolidation
The consolidated financial statements are those of the consolidated Group, comprising the financial statements of the parent
Company, and of all entities which the parent controls. The Group controls an entity when it is exposed, or has rights to variable
returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.
The financial statements of subsidiaries are prepared for the same reporting period as the parent entity, using consistent accounting
policies. Adjustments are made to bring into line any dissimilar accounting policies, which may exist.
All inter-company balances and transactions, including any unrealised profits or losses, have been eliminated on consolidation.
Subsidiaries are consolidated from the date that control is established.
(c) Comparatives
Where necessary, comparative information has been reclassified and repositioned for consistency with current year disclosures.
(d) Rounding amounts
The parent Company and the consolidated Group have applied the relief available under ASIC Corporations (Rounding in
Financial/Directors’ Reports) Instrument 2016/191 and, accordingly the amounts in the consolidated financial statements
and in the Directors’ Report have been rounded to the nearest thousand dollars, or in certain cases to the nearest dollar.
(e) Going concern
The Financial Report has been prepared on a going concern basis.
65
Hansen Technologies Ltd | Annual Report 2023 SECTION B: PERFORMANCE
This section explains the operating results of the Group for the year and provides insights into the Group’s results,
including results by operating segment, separately disclosed items during the year that affected the Group’s results,
components of income and expenses, income tax and earnings per share.
2. Segment information
(a) Description of segments
Management has determined the Group’s operating segments based on the reports reviewed by the Managing Director.
The operating segments are identified based on the types of services provided to the Group’s customers and the type of
customer the services are provided to. Discrete financial information about each of these operating businesses is reported
to the executive management team on at least a monthly basis.
Where operating segments meet the aggregation criteria, these are aggregated into reported segments. Operating segments are
aggregated based on similar products and services provided to the same type of customers using the same distribution method.
Segment profits, assets and liabilities include items directly attributable to a segment as well as those that can be allocated
on a reasonable basis. Inter-segment pricing is determined on an arm’s length basis and is eliminated on consolidation.
There are no significant transactions between segments.
The Group has identified only one reportable segment as described in the table below. No operating segments have been
aggregated to form the below reportable operating segment. The ‘other’ category includes business units that do not qualify
as an operating segment, as well as the operating segments which do not meet the disclosure requirements of a reportable
segment, including IT Outsourcing and Customer Care services.
Reportable Segment
Description of Segment
Billing
Sale of billing applications and the provision of consulting services related to billing systems.
(b) Segment information
2023
Segment revenue
Total segment revenue
Revenue from external customers
Segment profit
Total segment profit
Segment profit from core operations
Items included within the segment profit:
Depreciation expense
Amortisation expense
Total segment assets
Additions to non-current assets(1)
Total segment liabilities
Billing
$’000
305,012
305,012
58,700
58,700
9,830
32,491
448,272
25,897
173,194
Other
$’000
6,754
6,754
1,392
1,392
52
6
13,753
–
3,620
Total
$’000
311,766
311,766
60,092
60,092
9,882
32,497
462,025
25,897
176,814
(1) This includes additions to intangible assets and plant, equipment and leasehold improvements, see Notes 11 and 12.
66
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 2022
Segment revenue
Total segment revenue
Revenue from external customers
Segment profit
Total segment profit
Segment profit from core operations
Items included within the segment profit:
Depreciation expense
Amortisation expense
Total segment assets
Additions to non-current assets(1)
Total segment liabilities
Billing
$’000
288,955
288,955
53,558
53,558
7,961
31,889
459,032
21,619
214,357
Other
$’000
7,590
7,590
1,724
1,724
99
6
8,535
–
2,992
(1) This includes additions to intangible assets and plant, equipment and leasehold improvements, see Notes 11 and 12.
(i) Reconciliation of segment revenue to the consolidated statement of comprehensive income
Segment revenue
Total operating revenue
Geographical segments
Note
3
2023
$’000
311,766
311,766
Total
$’000
296,545
296,545
55,282
55,282
8,060
31,895
467,567
21,619
217,349
2022
$’000
296,545
296,545
In presenting information based on geographical segments, segment revenue is based on the geographical location of customers.
Segment assets are based on the geographical location of the assets.
The Group’s business segments operate geographically as follows:
Geographical Segment
Regions Covered
APAC
Americas
EMEA
Product segments
Australia, New Zealand and Asia
North America, Central America and Latin America
Europe, Middle East and Africa
In presenting information based on product segments, the Group’s business segments provide the following types of
products and services as follows:
Product
Licence, support
and maintenance
Services
Description of Product
Billing application licence, support and maintenance services delivered as part of a total billing
system solution.
Application service fees received for, upgrades, configuration, implementation
and customisation.
Hardware and software sales Provision of other third-party hardware and software licences to customers of the Group’s
Other
Includes reimbursed expenses incurred for servicing the customer contract.
billing system solutions.
67
Hansen Technologies Ltd | Annual Report 2023 2. Segment information (continued)
(ii) Disaggregation of revenue from contracts with customers by segment
Set out below is the disaggregation of the Group’s revenue from contracts with customers:
2023
Products
Licence, support and maintenance
Services
Hardware and software sales
Other revenue
Total revenue from contracts with customers
Revenue by market vertical
Energy
Communications
Other
Total revenue from contracts with customers
Revenue by geographic segment
APAC
Americas
EMEA
Total revenue from contracts with customers
Timing of revenue recognition
Goods and services transferred at a point in time
Services transferred over time
Total revenue from contracts with customers
2022
Products
Licence, support and maintenance
Services
Hardware and software sales
Other revenue
Billing
$’000
Other
$’000
Total
$’000
170,123
133,620
897
372
305,012
157,926
147,086
–
305,012
52,261
69,216
183,535
305,012
35,657
269,355
305,012
Billing
$’000
165,591
121,939
784
641
4,332
2,287
–
135
6,754
1,721
32
5,001
6,754
5,049
1,705
–
6,754
135
6,619
6,754
Other
$’000
5,740
1,818
–
32
174,455
135,907
897
507
311,766
159,647
147,118
5,001
311,766
57,310
70,921
183,535
311,766
35,792
275,974
311,766
Total
$’000
171,331
123,757
784
673
Total revenue from contracts with customers
288,955
7,590
296,545
Revenue by market vertical
Energy
Communications
Other
Total revenue from contracts with customers
Revenue by geographic segment
APAC
Americas
EMEA
Total revenue from contracts with customers
Timing of revenue recognition
Goods and services transferred at a point in time
Services transferred over time
Total revenue from contracts with customers
68
141,542
147,413
–
288,955
49,881
66,300
172,774
288,955
38,051
250,904
288,955
1,579
32
5,979
7,590
6,026
1,564
–
7,590
33
7,557
7,590
143,121
147,445
5,979
296,545
55,907
67,864
172,774
296,545
38,084
258,461
296,545
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 (iii) Reconciliation of segment profit from core operations to the consolidated statement of comprehensive income
Segment profit from core operations
Interest income
Unallocated depreciation and amortisation
Unallocated separately disclosed items impacting profit
Other expense
Profit before income tax
Income tax expense
Net profit after income tax expense
Note
3
4
2023
$’000
60,092
110
(1,921)
-
(3,956)
54,325
(11,530)
42,795
2022
$’000
55,282
63
(2,162)
(306)
(1,837)
51,040
(9,100)
41,940
As at 30 June 2023, the separately disclosed items have been allocated to the Billing Segment as they are directly attributable
to the segment.
(iv) Reconciliation of segment assets to the consolidated statement of financial position
Segment assets
Unallocated assets
– Cash
– Other
Total unallocated assets
Total assets
2023
$’000
2022
$’000
462,025
467,567
54,279
283
54,562
59,631
3,629
63,260
516,587
530,827
Total non-current assets attributed to individual geographies is detailed as follows. Unallocated assets include deferred tax
assets, which are not allocated to a specific location as they are managed on a group basis:
APAC
Americas
EMEA
Unallocated assets
Total non-current assets
(v) Reconciliation of segment liabilities to the consolidated statement of financial position
Segment liabilities
Unallocated liabilities
– Other
Total unallocated liabilities
Total liabilities
2023
$’000
56,114
203,459
109,865
96
2022
$’000
57,240
205,758
118,545
14
369,534
381,557
2023
$’000
2022
$’000
176,814
217,349
893
893
370
370
177,707
217,719
69
Hansen Technologies Ltd | Annual Report 2023 3. Revenue and other income
Operating revenue
Revenue from contracts with customers
Total operating revenue
Other income
From operating activities
Interest income
Profit from sale of non-financial assets
Other income
Total other income
Total revenue and other income
Note
2(b)(i)
2(b)(iii)
8(a)
2023
$’000
311,766
311,766
110
–
3,348
3,458
2022
$’000
296,545
296,545
63
55
730
848
315,224
297,393
(a) AASB 15 Revenue from Contracts with Customers
(i) Performance obligations
The transaction price allocated to remaining performance obligations represents contracted revenue that has not yet
been recognised. They include amounts recognised as unearned revenue and amounts that are contracted but not
yet billed or performed.
The transaction price allocated to performance obligations that are unsatisfied or partially unsatisfied as at 30 June 2023,
is $134,808,000 (2022: $103,377,000). This amount mostly comprises obligations in our long-term contracts to provide
software or “software-as-a-service” (SaaS), support and maintenance, open long-term professional services contracts as well
as licences contracted but not yet earned as the licence has not yet been deployed. A portion of this amount is expected to
be recognised as revenue beyond the next 12 months following the respective consolidated statement of financial position
date. This estimation is judgemental, as it needs to consider estimates of possible future contract modifications. The amount of
transaction price allocated to the remaining performance obligations, and changes in this amount over time, are impacted by,
among others, currency fluctuations and the remaining contract period of our billing solution agreements (which, in some cases,
are contracted until 5 years after the consolidated statement of financial position date).
(ii) Contract balances
Asset: Accrued revenue
Liability: Unearned revenue (current)
Liability: Unearned revenue (non-current)
2023
$’000
28,319
32,854
1,514
2022
$’000
21,657
36,821
4,030
Accrued revenue mainly relates to software licences deployed on contract inception which have yet to be billed to the customer.
Revenue recognised in the current financial year that was included in unearned revenue at the beginning of the current financial
year was $38,075,000 (2022: $31,639,000), representing support and maintenance, professional services, software and SaaS
delivered during the financial year.
(b) Government grants
Included in “Other income” during the financial year is $225,000 (2022: $280,000) of government grants received to
compensate for eligible employee expenditure related to research activities performed in Norway and in the United Kingdom.
There were no unfulfilled conditions or contingencies attached to these grants.
70
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 Significant accounting policies
Revenue
The Group derives revenues from customer contracts associated with the provision of billing solutions. A typical contract
may include various deliverables in consideration for fees. Such deliverables in our contracts include, but are not limited
to, the provision of a software licence, support, and maintenance services, as well as professional implementation and
customisation services.
The nature of fee structures within the contracts varies by customer. The timing and frequency of invoicing depends on
the terms and conditions of each contract. Invoices are billed to the customer either in advance or in arrears on normal
commercial terms. Where the contract requires invoicing in advance, revenue is initially deferred as unearned revenue
until the Group fulfils its performance obligations. Where the contract requires invoicing in arrears, revenue recognised on
fulfilment of a performance obligation is brought to account as accrued revenue, until the Group’s right to consideration
becomes unconditional and the accrued revenue is then presented as a receivable.
The Group’s accounting policies with respect to each of the individual deliverables in the Group’s customer contracts
are outlined in sub-sections (i) onwards.
(i) Licence, support and maintenance revenue
The Group’s contracts for billing solutions regularly include software licences associated with the relevant billing solution
provided to the customer. The nature of the licence varies by customer and billing solution. As part of the licence agreement,
various support and maintenance services are available to support the customer’s use of the billing solution. This includes
the provision of various bug fixes, updates and helpdesk support.
Generally, the provision of the software licence is a distinct performance obligation. However, where there are associated
implementation, customisation or other professional services in the contract that significantly modify, customise or
are highly interrelated with the licence, the software licence and implementation services are combined into a single
performance obligation. The determination of whether the licence should be combined with the services is a matter
of judgement, depending on the nature of the implementation of the services provided and the licence specifications
in the customer contract.
How the licence performance obligation is fulfilled depends on the nature of the licence and how the Group provides the
licence to the customer, irrespective of whether the licence is provided in perpetuity or for a specified contractual term:
• Where the licence is installed and delivered on customer premises, the customer can derive substantial benefits
from the licence on its own. Therefore, the performance obligation is fulfilled (and revenue recognised) at the point
in time the licence goes live, typically when customer acceptance has been obtained and the licence meets the
agreed-upon specifications.
• Where the licence is hosted by the Group (for example, in some of our SaaS applications), the customer is dependent
on our continual hosting of the licence platform in order to derive and receive substantial benefits from the licence.
Therefore, the performance obligation is fulfilled (and revenue recognised) over time, which is typically, evenly over
the contracted period in which access to the licence is made available to the customer.
Licence fees in some pay-TV and telecommunications contracts are dependent on the subsequent usage of the licence
by the customer, which is determined by customer-defined metrics such as subscriber counts or end-user numbers. For
these contracts, the Group uses the sales/usage-based royalty exception and recognises revenue when the subsequent
usage is known, which is typically at the end of each billing period.
Support and maintenance services are generally considered a distinct single performance obligation, separately identifiable
to the software licence, as all the individual activities that comprise of support and maintenance are highly interrelated with
each other. Revenue related to the provision of support and maintenance is recognised evenly over the contracted term in
which the customer is entitled to receive support and maintenance.
71
Hansen Technologies Ltd | Annual Report 2023 3. Revenue and other income (continued)
(ii) Services revenue
The Group provides various configuration, implementation, customisation and other professional services that the
customer is contracted to receive. This may be a part of the overall billing solution, or discrete projects separately agreed
with the customer. The various individual activities that form the professional services provided to the customer are highly
interrelated with each other and therefore are treated as a single performance obligation. Revenue from these professional
services is recognised over time by reference to the stage of completion of the contracts.
Stage of completion is measured by reference to labour hours incurred to date as a percentage of total estimated labour
hours for each contract, and by reference to any contracted milestones achieved, such as customer acceptance of the
final specification.
As described above in “Licence, support and maintenance revenue” certain professional services might be combined with
the provision of the software licence depending on the nature of the licence and the professional services provided.
(iii) Hardware/software sales revenue
Some of the Group’s subsidiaries on-sell certain third-party hardware and software products. Revenue is recognised when
control over the hardware/software has transferred to the customer. Determination of when control has passed depends
on whether the customer has legal title over the products, whether the customer has obtained possession of the products
or whether the Group has present right to payment.
The Group is considered principal in the sales transaction as the Group has procured the products from its various
vendors and the Group bears the risk and responsibility for selling those products to the customer.
(iv) Other revenue
Other revenue consists of reimbursed expenses incurred for servicing the customer contract. Revenue is recognised
when the Group has legal enforceability under the contract to have the relevant expenses reimbursed from the customer.
(v) Financing components
The Group does not have any contracts where the period between the transfer of the promised goods or services to the
customer represents a material financing component. Therefore, the Group does not adjust any of the transaction prices
for the time value of money.
(vi) Presentation and disclosure
In Note 2(b)(ii) of the financial statements, the Group has disaggregated revenue recognised from contracts with customers
into the following categories:
• The types of goods and services we provide our customers in our contracts;
• The primary market vertical that our customers operate in. ‘Energy’ includes our electricity, gas and water
customers, while ‘Communications’ includes our telecommunications and pay-TV customers; and
• The key geographic regions where our customers are located, which is consistent with the geographic segments
identified for our segment reporting.
We believe these categories best depict how the nature, amount, timing and uncertainty of revenue and cash flows are
affected by economic factors.
AASB 15 uses the terms “contract asset” and “contract liability”. To maintain consistency in presentation with prior
periods, the Group has retained the use of “accrued revenue” and “unearned revenue,” respectively.
In disclosing the amount of the transaction price allocated to unsatisfied or partially satisfied performance obligations,
the Group has elected to use the practical expedient available in AASB 15 and disclose only the amounts allocated to
performance obligations for contracts with original expected duration of more than one year and for contracts where the
Group’s right to consideration from a customer does not correspond directly with the value to the customer of the Group’s
performance completed to date.
72
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 Interest income
Interest income is recognised when it becomes receivable on a proportional basis, taking into account the interest rates
applicable to the financial assets.
Sales tax (including GST and VAT)
Revenues, expenses and assets are recognised net of the amount of sales tax, except where the amount of sales tax
incurred is not recoverable from the Tax Office. In these circumstances the sales tax is recognised as part of the acquisition
of the asset or as part of an item of the expense. Receivables and payables in the consolidated statement of financial
position are shown inclusive of sales tax.
The net amount of GST/VAT recoverable from, or payable to the taxation authority is included as part of receivables
or payables in the statement of financial position. Commitments and contingencies are disclosed net of the amount
of GST recoverable from, or payable to, the taxation authority.
Cash flows are presented in the consolidated statement of cash flows on a gross basis, except for the sales tax
component of investing and financing activities, which are disclosed as operating cash flows.
Government grants
Government grants are recognised at their fair value where there is reasonable assurance that the grant will be received
and all attached conditions will be complied with. Government grants relating to costs are deferred and recognised in the
consolidated statement of comprehensive income over the period necessary to match them with the costs that they are
intended to compensate. Government grants received for which there are no future related costs are recognised in
the statement of comprehensive income immediately.
73
Hansen Technologies Ltd | Annual Report 2023 4. Separately disclosed items
The Group has disclosed underlying EBITDA and underlying profit after tax, referring to the Group’s trading results, adjusted for
certain transactions during the year that are not representative of the Group’s regular business activities. The Group considers
that these transactions are of such significance to understanding the ongoing results of the Group, that the Group has elected
to separately identify these transactions to determine an ongoing result to enable a “like-for-like” comparison. These items are
described as “separately disclosed items” throughout this Financial Report.
Net (decrease)/increase to EBITDA
Non-recurring items
Other one-off costs
Non-recurring income
Total separately disclosed items
Note
2(b)(iii)
2023
$’000
596
(1.755)
(1,159)
2022
$’000
306
–
306
For the financial year ended 30 June 2023, the Group recognised one-off costs relating to restructuring totalling $596,000 for
the partial wind-down of a smaller talent centre. These costs, which primarily included redundancies and associated costs, are
part of the Group’s strategy to better integrate the business and align staffing according to customer demand. These costs are
included within the “Employee benefit expenses” account in the Group’s consolidated statement of comprehensive income.
Additionally, a $1,755,000 provision relating to the acquisition of Sigma Systems in June 2019 was released in the current period.
This release was included within the “Other Income” account in the Group’s consolidated statement of comprehensive income.
In the previous financial year, the Group has recognised professional fees of $306,000 in relation to the non-binding conditional
proposal from BGH Capital Pty Ltd (BGH Capital) to acquire 100% of the outstanding shares in Hansen by way of a Scheme
of Arrangement. The proposal was withdrawn by BGH Capital on 6 September 2021. These costs have been included within
the “Professional expenses” account in the Group’s consolidated statement of comprehensive income.
(a) Reconciliation with Group statutory measures
Underlying EBITDA
Less separately disclosed items
EBITDA(1)
Underlying net profit after tax before acquired amortisation, net of tax(2)
Less acquired amortisation, net of tax
Underlying net profit after tax(3)
Less separately disclosed items
Tax effect of separately disclosed items
Net profit after tax
2023
$’000
99,502
1,159
100,661
55,603
(14,116)
41,487
1,159
149
42,795
2022
$’000
100,253
(306)
99,947
58,163
(16,010)
42,153
(306)
93
41,940
(1) EBITDA is a non-IFRS term, defined as earnings before interest, tax, depreciation and amortisation, and excluding net foreign exchange losses/gains.
(2) Underlying net profit after tax, before acquired amortisation, net of tax, or underlying NPATA, excludes separately disclosed items, which represent one-off costs
incurred during the financial year and acquired amortisation, net of tax.
(3) Underlying net profit after tax or underlying NPAT excludes separately disclosed items, which represent the one-off costs during the financial year.
74
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 5. Profit from continuing operations
Profit from continuing operations before income tax has been determined after the following specific significant expenses:
Note
2023
$’000
2022
$’000
Employee benefit expenses
Wages and salaries
Superannuation costs
Share-based payments and employee share plan expensed
8(a), 17(c)
Total employee benefit expenses
Depreciation expense
Plant, equipment and leasehold improvements
Right-of-use assets
Total depreciation of non-current assets
Amortisation of non-current assets
Technology and other intangibles
Software development costs
Total amortisation of non-current assets
Property and operating rental expenses
Other property-related expenses
Total property and operating rental expenses
Finance costs
Finance costs on borrowings
Prepaid borrowing costs
Net finance costs on borrowings
Total cost on borrowings
Finance costs on lease liabilities
Total finance costs
Net foreign exchange losses
Realised foreign exchange (gain)/losses
Unrealised foreign exchange (gain)/losses
Total net foreign exchange (gain)/losses
11
13(a)
8(a)
12
12
8(a)
8(a),19(a)
13(c)
8(a)
154,535
10,815
1,528
166,878
4,634
6,397
11,031
19,047
14,222
33,269
3,678
3,678
151
3,964
4,115
772
4,887
(1,182)
(1,559)
(2,741)
143,129
9,357
2,437
154,923
3,919
6,054
9,973
20,602
11,542
32,144
3,635
3,635
1,592
2,049
3,641
854
4,495
770
1,588
2,358
75
Hansen Technologies Ltd | Annual Report 2023 6. Income tax
(a) Components of income tax expense
Current tax expense
Movement in deferred tax relating to income tax expense
Over provision in prior years
Total income tax expense
The prima facie tax payable on profit before income tax reconciled
to the income tax expense is as follows:
Note
6(b)(iv)
2023
$’000
12,949
(300)
(1,119)
11,530
2022
$’000
11,339
(606)
(1,633)
9,100
Prima facie income tax payable on profit before income tax at 30%
16,297
15,312
Add/(less) tax effect of:
Impact of tax rates on foreign subsidiaries
Research and development allowances
Non-deductible share-based payments
Over provision in prior years
Utilisation of prior year tax losses not brought to account
Change in tax rate during the financial year
Amortisation of acquired intangibles
Other non-allowable items
Income tax expense attributable to profit
(b) Deferred tax
Deferred tax asset
Deferred tax liability
Net deferred tax
(i) Deferred tax asset
The deferred tax asset balance comprises of the following items:
Other payables
Employee benefits
Temporary difference relating to lease accounting
Accruals and provisions
Deferred tax asset
(4,547)
(524)
–
(1,119)
(21)
18
248
1,178
11,530
2023
$’000
6,581
(33,960)
(27,379)
2023
$’000
702
2,235
1,766
1,878
6,581
(3,140)
(431)
(341)
(1,633)
(1,379)
18
286
408
9,100
2022
$’000
7,781
(35,588)
(27,807)
2022
$’000
1,446
2,417
2,181
1,737
7,781
Note
6(b)(i)
6(b)(ii)
Note
6(b)
76
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 (ii) Deferred tax liability
The deferred tax liability balance comprises of the following items:
Research and development expenditure capitalised
Difference in depreciation of plant, equipment and leasehold
improvements for accounting and income tax purposes
Difference in amortisation of intangible assets for accounting
and income tax purposes
Share-based payments
Temporary difference relating to lease accounting
Other income not yet assessable
Other payables
Deferred tax liability
(iii) Reconciliation of net deferred tax balances
Opening balance – net deferred tax liability
Tax income during the financial year
Closing balance – net deferred tax liability
(iv) Movement in deferred tax relating to income tax expense
Deferred tax recognised in income tax expense comprises of:
Note
2023
$’000
(9,782)
2022
$’000
(7,724)
(3,569)
(2,221)
(17,555)
(537)
(1,577)
(505)
(435)
(21,772)
(739)
(2,045)
(626)
(461)
6(b)
(33,960)
(35,588)
Note
6(b)(iv)
6(b)
2023
$’000
(27,807)
428
(27,379)
2022
$’000
(28,634)
827
(27,807)
Decrease in deferred tax asset
Decrease in deferred tax liability
Tax income during the financial year
Deferred tax credited directly to share-based payments reserve
Deferred tax recognised in income tax expense
(v) Deferred tax assets not brought to account (available tax losses)
Note
6(b)(iii)
8(a), 22(b)
6(a)
Gross capital losses
Gross operating losses
Total
2023
$’000
1,200
(1,628)
(428)
128
(300)
2023
$’000
847
257
1,104
2022
$’000
1,623
(2,450)
(827)
221
(606)
2022
$’000
847
202
1,049
Deferred tax assets have not been recognised in respect of these losses. Realisation of the unrecognised tax losses, temporary
differences and offsets are dependent on the future production of sufficient taxable profits in the relevant jurisdictions as well as
continued compliance with regulatory requirements for availability.
77
Hansen Technologies Ltd | Annual Report 2023 6. Income tax (continued)
Significant accounting policies
Income tax
Current income tax expense is the tax payable on the current period’s taxable income based on the applicable income tax
rate adjusted by changes in deferred tax assets and liabilities. The tax rates and tax laws used to compute the amount are
those that are enacted or substantively enacted at the reporting date.
Deferred tax balances
Deferred tax assets and liabilities are recognised for temporary differences at the applicable tax rates when the assets are
expected to be recovered or liabilities settled. No deferred tax asset or liability is recognised in relation to temporary
differences if they arose in a transaction, other than a business combination, that at the time of the transaction did not
affect either accounting profit or taxable profit or loss.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly
in equity.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no
longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised.
Unrecognised deferred tax assets are reassessed at each reporting date and are recognised to the extent that it has
become probable that future taxable profits will allow the deferred tax asset to be recovered.
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets
against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.
Tax consolidation
The Group is subject to income taxes in Australia and jurisdictions in which it has foreign operations. In some of these
jurisdictions, namely Australia and the United States, the immediate parent entity and entities it controls have formed local
income tax consolidated groups that are taxed as a single entity in their relevant jurisdiction. The head entity of the
Australian tax consolidated group is Hansen Technologies Limited. Each tax consolidated group has entered a tax
funding agreement whereby each entity in the tax consolidated group recognises the assets, liabilities, expenses
and revenues in relation to its own transactions, events and balances only. This means that:
• the parent entity recognises all current and deferred tax amounts relating to its own transactions, events and
balances only;
• the subsidiaries recognise current or deferred tax amounts arising in respect of their own transactions, events and
balances; and
• the current tax liabilities and deferred tax assets arising in respect of tax losses, are transferred from the subsidiary
to the head entity as inter-company payables or receivables.
Each tax consolidated group also has a tax sharing agreement in place to limit the liability of subsidiaries in the tax
consolidated group arising under the joint and several liability requirements of the tax consolidation system, in the event
of default by the parent entity to meet its payment obligations. This means that under the tax sharing agreement,
the subsidiaries are legally liable to the income tax payable in proportion to their contribution to the net profit before
tax of the tax consolidated group.
78
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 7. Earnings per share
Reconciliation of earnings used in calculating earnings per share:
Basic earnings – ordinary shares
Diluted earnings – ordinary shares
Weighted average number of ordinary shares used in calculating earnings per share:
Number for basic earnings per share – ordinary shares
Number for diluted earnings per share – ordinary shares
Basic earnings (cents) per share
Diluted earnings (cents) per share
2023
$’000
42,795
42,795
2022
$’000
41,940
41,940
2023
No. of Shares
2022
No. of Shares
202,410,396
200,576,315
205,588,213
203,174,502
2023
Cents Per
Share
21.1
20.8
2022
Cents Per
Share
20.9
20.6
Classification of securities as potential ordinary shares
As at 30 June 2023 and 30 June 2022, the securities that have been classified as potential ordinary shares and included
in diluted earnings per share are the rights outstanding under the Employee Performance Rights Plan.
Significant accounting policies
Earnings per share (EPS)
Basic EPS is calculated by dividing the profit for the year attributable to ordinary equity holders of the Company by the
weighted average number of ordinary shares outstanding during the year.
Diluted EPS is calculated by dividing the profit attributable to ordinary equity holders of the Company by the weighted
average number of ordinary shares outstanding during the year, plus the weighted average number of ordinary shares
that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares.
79
Hansen Technologies Ltd | Annual Report 2023 SECTION C: WORKING CAPITAL AND OPERATING ASSETS
This section describes the different components of our working capital supporting the operating liquidity of the Group,
as well as the long-term tangible and intangible assets supporting the Group’s performance.
8. Cash and cash equivalents
Cash at bank and on hand
Total cash and cash equivalents
2023
$’000
54,279
54,279
(a) Reconciliation of the net profit after tax to net cash flows from operating activities
2022
$’000
59,631
59,631
2022
$’000
41,940
2023
$’000
42,795
–
(55)
44,300
1,528
128
(1,559)
–
688
246
151
42,117
2,437
221
1,588
(84)
117
–
1,592
88,277
89,873
3,538
(6,662)
1,039
(968)
(428)
509
(6,483)
78,822
23,456
2,646
(14,329)
(1,371)
(827)
(13,907)
5,690
91,231
Note
3
5
5,17(c)
6(b)(iv)
5
9
9
13(a)
5, 19(a)
Net profit after tax
Add/(less) items classified as investing/financing activities:
Net profit on sale of non-current assets
Add/(less) non-cash items:
Depreciation and amortisation
Share-based payments
Deferred tax income credited directly to share-based payments reserve
Unrealised foreign exchange (gains)/losses
Recovery of previously charged expected credit loss
Expected credit loss charged
Lease impairment
Amortisation of prepaid borrowing costs
Net cash generated from operating activities before change
in assets and liabilities
Changes in assets and liabilities adjusted for effects of purchase
of controlled entities during the year:
Decrease in receivables and other assets
(Increase)/decrease in accrued revenue
Increase/(decrease) in creditors and liabilities
Decrease in operating and employee benefits provision
Decrease in deferred taxes
Increase/(decrease) in current tax payable
(Decrease)/increase in unearned revenue
Net cash inflow from operating activities
Significant accounting policies
Cash and cash equivalents
Cash and cash equivalents include cash on hand and at banks, short term deposits with an original maturity of
six months or less held at call with financial institutions and bank overdrafts. Bank overdrafts are shown within
borrowings in current liabilities on the consolidated statement of financial position.
80
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 9. Receivables
Current
Trade receivables
Less: provision for expected credit losses
Sundry receivables
Total trade and other receivables
2023
$’000
55,608
(1,487)
54,121
3,031
57,152
2022
$’000
56,534
(921)
55,613
397
56,010
As at 30 June 2023, trade receivables of $14,138,000 (2022: $18,453,000) were past due but not impaired. These relate to
a number of unrelated customers for whom there is no recent history of default. The ageing analysis of the trade receivables
is as follows:
Trade receivables ageing analysis at 30 June:
Not past due
Past due 1– 30 days
Past due 31– 60 days
Past due more than 61 days
Total
Gross
2023
$’000
39,983
5,338
4,979
5,308
55,608
Provided
2023
$’000
–
–
–
(1,487)
(1,487)
Gross
2022
$’000
37,160
11,748
4,179
3,447
56,534
Provided
2022
$’000
–
–
–
(921)
(921)
The sundry receivables do not contain impaired assets and are not past due. Based on the credit history of these receivables,
it is expected that these amounts will be received when due and therefore no provision for impairment has been recorded.
The Group does not hold any collateral in relation to these receivables.
Movements in provision for expected credit loss:
Opening balance at 1 July
Expected credit loss charged
Recovery of previously charged expected credit loss
Amounts written off
Others
Closing balance at 30 June
Note
8(a)
8(a)
2023
$’000
921
688
–
(706)
584
1,487
2022
$’000
1,457
117
(84)
(616)
47
921
81
Hansen Technologies Ltd | Annual Report 2023 9. Receivables (continued)
Significant accounting policies
Trade receivables
Trade receivables represent amounts owed by our customers and are recognised initially at the amount of consideration
where the right to payment is conditional only on the passage of time. The Group holds the trade receivables with the
objective of collecting contractual cash flows and therefore measures them subsequently at amortised cost using the
effective interest method, less a provision for expected credit loss. Trade receivables are generally due for settlement
between 30 and 60 days.
The Group recognises a provision for impairment by calculating lifetime expected credit losses (ECLs). In determining
the appropriate amount of lifetime ECLs, the Group has established a provision matrix that is based on its historical
credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment.
Individual debts which are known to be uncollectible are written-off by reducing the carrying amount directly. Expected
credit losses are recognised in the consolidated statement of comprehensive income within “Other expenses” account.
When a trade receivable for which a provision for expected credit loss had been recognised becomes uncollectible in
a subsequent period, it is written off against the allowance account.
Critical accounting estimate and judgement
Provision for expected credit losses of trade receivables
The Group uses a provision matrix to calculate ECLs for trade receivables. The provision rates are based on days past due
for groupings of various customer segments that have similar loss patterns (i.e. by geography, product type, customer type
and rating, and coverage by letters of credit and other forms of credit insurance).
The provision matrix is initially based on the Group’s historical observed default rates. The Group will calibrate the matrix to
adjust the historical credit loss experience with forward-looking information. For instance, if forecast economic conditions
(i.e., gross domestic product) are expected to deteriorate over the next year which can lead to an increased number of
defaults in the energy sector, the historical default rates are adjusted. At every reporting date, the historical observed
default rates are updated and changes in the forward-looking estimates are analysed.
The assessment of the correlation between historical observed default rates, forecast economic conditions and ECLs is
a significant estimate. The amount of ECLs is sensitive to changes in circumstances and of forecast economic conditions.
The Group’s historical credit loss experience and forecast of economic conditions may also not be representative of
customers’ actual default in the future. Therefore, where required, the Group will provide for specific debtors that are
experiencing one-off instances that could result in a future loss.
10. Other assets
Prepayments – current
Other assets – current
Total other current assets
Prepayments – non-current
Other assets – non-current
Total other non-current assets
82
2023
$’000
7,112
191
7,303
1,390
44
1,434
2022
$’000
7,321
1,727
9,048
1,559
330
1,889
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 11. Plant, equipment and leasehold improvements
Cost
At 1 July 2022
Additions
Disposals
Net foreign currency movements arising
from foreign operations
At 30 June 2023
Accumulated depreciation and impairment
At 1 July 2022
Depreciation charge
Disposals
Net foreign currency movements arising
from foreign operations
At 30 June 2023
Carrying amount at 30 June 2023
Cost
At 1 July 2021
Additions
Disposals
Net foreign currency movements arising
from foreign operations
At 30 June 2022
Accumulated depreciation and impairment
At 1 July 2021
Depreciation charge
Disposals
Net foreign currency movements arising
from foreign operations
At 30 June 2022
Carrying amount at 30 June 2022
Note
2(b)
5
Note
2(b)
5
Plant and
equipment
$’000
Leasehold
improvements
$’000
38,027
4,708
(221)
1,069
43,583
(24,481)
(4,210)
245
(624)
(29,070)
14,513
4,025
49
(266)
76
3,884
(3,127)
(424)
242
(37)
(3,346)
538
Plant and
equipment
$’000
Leasehold
improvements
$’000
34,897
5,788
(2,249)
(409)
38,027
(23,238)
(3,649)
2,198
208
(24,481)
13,546
3,875
227
(57)
(20)
4,025
(2,944)
(270)
57
30
(3,127)
898
Total
$’000
42,052
4,757
(487)
1,145
47,467
(27,608)
(4,634)
487
(661)
(32,416)
15,051
Total
$’000
38,772
6,015
(2,306)
(429)
42,052
(26,182)
(3,919)
2,255
238
(27,608)
14,444
83
Hansen Technologies Ltd | Annual Report 2023 11. Plant, equipment and leasehold improvements (continued)
Significant accounting policies
Plant, equipment and leasehold improvements
Cost and valuation
All classes of plant, equipment and leasehold improvements are stated at cost less depreciation and any accumulated
impairment losses.
Depreciation
The depreciable amounts of all fixed assets are depreciated on a straight-line basis over their estimated useful lives
commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter
of either the unexpired period of the lease or the estimated useful lives of the improvements.
The useful lives for each class of assets are:
Plant and equipment
Leasehold improvements
2023
2022
3 to 15 years
3 to 15 years
3 to 15 years
3 to 15 years
An item of plant, equipment and leasehold improvements initially recognised is derecognised upon disposal. Any gain or
loss arising from the derecognition of the asset (calculated as the difference between the net disposal proceeds and the
carrying amount of the asset) is included in the profit or loss when the asset is derecognised.
The residual values, useful lives and methods of depreciation of plant, equipment and leasehold improvements are
reviewed at each financial year end and are adjusted prospectively, if appropriate.
Note
2(b)
5
Technology
and Other
Intangibles
at Cost
$’000
Software
Development
at Cost
$’000
Goodwill
$’000
221,406
192,014
–
434
–
768
107,689
21,140
674
221,840
192,782
129,503
(1,591)
–
(17)
(1,608)
220,232
(104,737)
(19,047)
(1,361)
(125,145)
67,637
(70,306)
(14,222)
(24)
(84,552)
44,951
Total
$’000
521,109
21,140
1,876
544,125
(176,634)
(33,269)
(1,402)
(211,305)
332,820
12. Intangible assets
Cost
At 1 July 2022
Additions
Net foreign currency movements
arising from foreign operations
At 30 June 2023
Accumulated amortisation and
impairment
At 1 July 2022
Amortisation charge
Net foreign currency movements
arising from foreign operations
At 30 June 2023
Carrying amount at 30 June 2023
84
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 Note
Goodwill
$’000
Technology
and Other
Intangibles
at Cost
$’000
Software
Development
at Cost
$’000
218,748
188,530
2(b)
–
–
2,658
221,406
3,484
192,014
5
(1,601)
–
10
(1,591)
219,815
(82,239)
(20,602)
(1,896)
(104,737)
87,277
90,058
15,604
2,027
107,689
(57,343)
(11,542)
(1,421)
(70,306)
37,383
Total
$’000
497,336
15,604
8,169
521,109
(141,183)
(32,144)
(3,307)
(176,634)
344,475
Cost
At 1 July 2021
Additions
Net foreign currency movements
arising from foreign operations
At 30 June 2022
Accumulated amortisation and
impairment
At 1 July 2021
Amortisation charge
Net foreign currency movements
arising from foreign operations
At 30 June 2022
Carrying amount at 30 June 2022
Significant accounting policies
Goodwill
Goodwill represents the future economic benefits arising from other assets acquired in a business combination that are not
individually identifiable or separately recognised. Goodwill is recognised initially at the excess of: (a) the aggregate of the
consideration transferred, the fair value of the non-controlling interests and the acquisition date fair value of the acquirers
previously held equity interest; over (b) the net fair value of the identifiable assets acquired and liabilities assumed.
Technology and other intangibles
Other intangibles consist of trademarks, brand names, customer relationships and non-compete clauses.
Technology and other intangibles are recognised at cost and are amortised over their estimated useful lives, which
is generally the term of the contract for customer contracts and 5-10 years for technology and other intangibles.
Technology and other intangibles are carried at cost less accumulated amortisation and any impairment losses.
Research and development
Expenditure on research activities is recognised as an expense when incurred.
Development costs are capitalised when the entity can demonstrate all of the following: the technical feasibility of
completing the asset so that it will be available for use or sale; the intention to complete the asset and use or sell it;
the ability to use or sell the asset; how the asset will generate probable future economic benefits; the availability
of adequate technical, financial and other resources to complete the development and to use or sell the asset;
and the ability to measure reliably the expenditure attributable to the asset during its development.
Capitalised development expenditure is carried at cost less any accumulated amortisation and any accumulated impairment
losses. Amortisation is calculated using a straight–line method to allocate the cost of the intangible asset over its estimated
useful life, which is generally 5 years. Amortisation commences when the intangible asset is available for use.
Other development expenditure is recognised as an expense when incurred.
Impairment of non-financial assets
Assets with an indefinite useful life are not amortised but are tested at least annually for impairment in accordance with
AASB 136 Impairment of Assets. Assets subject to annual depreciation or amortisation are reviewed for impairment
whenever events or circumstances arise that indicate that the carrying amount of the asset may be impaired. An
impairment loss is recognised where the carrying amount of the asset exceeds its recoverable amount. The recoverable
amount of an asset is defined as the higher of its fair value less costs of disposal and value in use.
85
Hansen Technologies Ltd | Annual Report 2023 12. Intangible assets (continued)
Critical accounting estimate and judgement
Capitalisation of research and development costs
Development costs incurred are assessed for each research and development project and a percentage of the expenditure
is capitalised when technical feasibility studies demonstrate that the project will deliver future economic benefits and those
benefits can be measured reliably.
There has been an investment in research and development expenditure incurred in relation to the various billing software
platforms in the 2023 financial year. Returns are expected to be derived from this investment over the coming year(s).
The assets’ residual values, useful lives and amortisation methods are reviewed and adjusted if appropriate at each
financial year end. The estimation of useful lives of assets has been based on historical experience and expected product
lifecycle, which could change significantly as a result of technological innovation.
(a) Impairment test for goodwill
For impairment testing, the Group views that its past business combinations giving rise to goodwill on acquisition relate to
synergistic opportunities for its billing solutions. Therefore, goodwill is allocated entirely to the Billing CGU, which is also
an operating and reportable segment.
The recoverable amount of the Billing CGU has been determined based on a value-in-use calculation using cash flow
projections over a five-year period. Cash flows beyond the five-year forecast period are extrapolated using the estimated
terminal growth rates.
Key assumptions used for value-in-use calculations
The key assumptions for the Billing CGU supporting the disclosed recoverable value are as follows:
• EBITDA for the first year based on financial budgets approved by the Board;
• Beyond the first year, profit before tax annual growth rate of 2% (2022: 1.5%);
• A post-tax discount rate of 8.3% (2022: 8.2%); and
• Terminal growth rate of 2% (2022: 1.5%) at the end of the forecast period.
Both the EBITDA growth rate beyond FY23 and the terminal growth rate ranges are derived from management’s best estimate
of revenue and operating expenditure growth, taking into account changes in the industry, customer market prospects,
future product developments and technological innovation. Profit before income tax expense is then adjusted for amounts
related to tax.
The discount rate represents the current market assessment of the risks specific to the CGU, taking into consideration the time
value of money coupled with other risk factors. It is based on the Group’s weighted average cost of capital.
86
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 Critical accounting estimate and judgement
Impairment of goodwill
The Group tests whether goodwill has been impaired on an annual basis. Management judgement is applied to identify the
cash generating units (CGU). The recoverable amount of a CGU is determined based on value-in-use calculations which
require the use of assumptions and discounting of future cash flows. These assumptions are based on best estimates at
the time of performing the valuation. Cash flow projections do not include restructuring activities that the Group is not yet
committed to or significant future investments that will enhance the performance of the assets of the CGU being tested.
Goodwill is monitored by management at the level of operating segments identified in Note 2.
Impairment of non-financial assets other than goodwill
All assets are assessed for impairment at each reporting date by evaluating whether indicators of impairment exist
in relation to the continued use of the asset by the consolidated entity. Impairment triggers include declining product,
technology changes, adverse changes in the economic or political environment or future product expectations.
If an indicator of impairment exists, the recoverable amount of the asset is determined.
13. Leases
(a) Right-of-use assets
Cost
Accumulated depreciation
Net carrying amount at 30 June
2023
$’000
29,318
(15,670)
13,648
2022
$’000
28,494
(15,526)
12,968
Movements in cost and accumulated depreciation during the year are inclusive of any net foreign currency movements arising
from foreign operations.
The Group has identified the following classes of right-of-use (“ROU”) assets: properties, vehicles, office and IT equipment.
The largest class of asset recognised is the Group’s property leases, consisting of office buildings, as well as rental apartments
for its employees undertaking short-term assignments overseas. Leases of properties generally have lease terms between
6 months and 5 years while leases of office equipment and vehicles, generally have terms between 1 and 3 years. The Group
usually has rights to renew the lease arrangement that are reasonably certain to be exercised and therefore may have long
effective lease terms. The rental payments associated with each lease vary according to the amount of space rented and the
location of the lease. However, in most cases the amount of rental payments is indexed annually in line with the relevant national
consumer pricing index.
87
Hansen Technologies Ltd | Annual Report 2023 13. Leases (continued)
Reconciliation of the carrying amounts of ROU assets at the beginning and end of the current financial year by class of asset
is shown below:
Cost
Balance as at 1 July 2022
Additions
Re-measurement
Make good provision
Impairment
Disposals
Exchange differences from foreign
operations
Balance as at 30 June 2023
Accumulated depreciation
Balance as at 1 July 2022
Depreciation charge
Disposals
Exchange differences from foreign
operations
Balance as at 30 June 2023
Net book value as at 30 June 2023
Cost
Balance as at 1 July 2021
Additions
Re-measurement
Disposals
Exchange differences from foreign
operations
Balance as at 30 June 2022
Accumulated depreciation
Balance as at 1 July 2021
Depreciation charge
Disposals
Exchange differences from foreign
operations
Balance as at 30 June 2022
Net book value as at 30 June 2022
Note
13(b)
13(b)
5, 13(c)
Note
13(b)
13(b)
5, 13(c)
ROU
Properties
$’000
ROU Office
Equipment
$’000
ROU
Vehicles
$’000
28,325
6,160
1,186
19
(246)
(6,789)
514
29,169
(15,432)
(6,356)
6,498
(286)
(15,576)
13,593
81
–
–
–
–
(11)
3
73
(28)
(21)
11
(2)
(40)
33
88
18
–
–
–
(35)
5
76
(66)
(20)
35
(3)
(54)
22
ROU
Properties
$’000
ROU Office
Equipment
$’000
ROU
Vehicles
$’000
26,994
2,388
82
(1,601)
462
28,325
(10,958)
(5,995)
1,601
(80)
(15,432)
12,893
138
35
–
(96)
4
81
(64)
(35)
71
–
(28)
53
88
–
–
–
–
88
(41)
(24)
–
(1)
(66)
22
Total
$’000
28,494
6,178
1,186
19
(246)
(6,835)
522
29,318
(15,526)
(6,397)
6,544
(291)
(15,670)
13,648
Total
$’000
27,220
2,423
82
(1,697)
466
28,494
(11,063)
(6,054)
1,672
(81)
(15,526)
12,968
In the financial year ended 30 June 2023, the cost of variable lease payments amounted to $10,000 (2022: $4,000).
These variable lease payments do not depend on an index or a rate. These are included within the “Other Expenses”
account in the consolidated statement of comprehensive income.
88
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 (b) Lease liabilities
Current
Non-current
Total
2023
$’000
5,434
9,563
2022
$’000
5,662
8,213
14,997
13,875
Reconciliation of the carrying amounts of lease liabilities and the movements during the financial year is shown below:
Balance as at 1 July
Additions
Re-measurement
Disposals
Accretion of finance costs
Payments of finance costs
Payments of principal amounts
Exchange differences from foreign operations
Balance as at 30 June
(c) Impact to profit or loss
The following are the amounts recognised in the profit or loss:
Depreciation expense of ROU assets
Finance costs on lease liabilities
Variable lease payments
Income from sub-leasing of ROU assets
Total amount recognised in profit or loss
Note
13(a)
13(a)
13(c)
Note
13(a)
5, 13(b)
2023
$’000
13,875
6,178
1,186
(291)
772
(772)
(6,188)
237
14,997
2023
$’000
6,397
772
10
(83)
7,096
2022
$’000
16,874
2,423
82
(26)
854
(854)
(5,996)
518
13,875
2022
$’000
6,054
854
4
(33)
6,879
(d) Impact to cashflows
The Group had total cash outflows for leases of $6,960,000 for the year ended 30 June 2023 (2022: $6,850,000). Out of the
$6,960,000 (2022: $6,850,000) cash outflows, $6,188,000 (2022: $5,996,000) relates to cash outflows from financing activities
(principal payments), while the remaining balance relates to cash outflows from operating activities (finance costs on lease liabilities).
The Group also had non-cash additions of ROU assets of $6,178,000 (2022: $2,423,000) and lease liabilities of $6,178,000
(2022: $2,423,000) during the financial year.
89
Hansen Technologies Ltd | Annual Report 2023 13. Leases (continued)
(e) Future lease payments
Future lease payments in relation to lease liabilities are as follows:
Less than 6 months
6–12 months
Total current lease payments
Future finance costs on lease liabilities
Current lease liabilities
1–2 years
2–3 years
More than 3 years
Total non-current lease liabilities
Future finance costs on lease liabilities
Non-current lease liabilities
Note
18(b), 23
18(b), 23
18(b), 23
18(b), 23
18(b), 23
2023
$’000
3,280
2,900
6,180
(746)
5,434
3,389
2,366
5,634
11,389
(1,826)
9,563
2022
$’000
3,308
2,918
6,226
(564)
5,662
3,878
1,875
3,970
9,723
(1,510)
8,213
The weighted average incremental borrowing rate applied to lease liabilities was 5.89% (2022: 4.63%).
90
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 Significant accounting policies
Leases
The determination of whether an arrangement is (or contains) a lease depends on whether the arrangement conveys the
right to control the use of an identified asset for a period of time in exchange for consideration. Control over the use of an
identified asset exists when the arrangement involves the use of an identified asset, when the Group obtains substantially
all the economic benefits from the use of the asset, and when the Group has the right to direct the use of the asset.
The lease term is first determined with reference to the non-cancellable period of the lease contract, adjusted for any
periods covered by options to extend the lease and/or to early terminate the lease if the Group is reasonably certain
to exercise the options. Judgement is applied by the Group in determining whether the Group is reasonably certain to
exercise the options.
Lease liabilities are initially recognised and measured based on the total value of fixed and variable contractual lease
payments over the lease term, including payments to extend or terminate the lease if the Group is reasonably certain to
exercise the option to extend or terminate the lease, respectively. The lease payments are discounted to present value
based on the incremental borrowing rate implicit in the lease.
Lease payments on properties exclude service fees for maintenance, cleaning and other costs as these costs are
separated as non-lease components. However, the Group has elected not to separate lease and non-lease components
for leases of vehicles, offices and IT equipment.
Leased assets are capitalised at the commencement date of the lease and comprise of the initial lease liability amount,
initial direct costs incurred when entering the lease, less any lease incentives received.
Leased assets are depreciated on a straight-line basis over the earlier of the end of the useful life of the right-of-use asset
or the end of the lease term, as follows:
• ROU properties
• ROU office equipment
• ROU vehicles
• ROU IT equipment
Estimated useful lives of right-of-use assets are determined on the same basis as those of plant, equipment and
leasehold improvements.
The right-of-use asset is also periodically assessed for impairment losses and adjusted for certain remeasurements
of the lease liability.
The Group does not apply the practical expedients for short-term leases and leases for which the assets are of low value.
Presentation and disclosure
Depreciation on right-of-use assets is included as part of the “Depreciation expense” account in the consolidated
statement of comprehensive income, and interest expense on lease liabilities is included as part of the “Finance costs
on lease liabilities” account in the consolidated statement of comprehensive income.
Right-of-use assets are disclosed separately on the consolidated statement of financial position, with Note 13(a)
disaggregating the lease assets by class of asset. Lease liabilities are presented as current and non-current in the
consolidated statement of financial position depending on the timing of the settlement of contractual cash outflows.
The repayment of the principal portion of lease payments is presented as part of financing activities in the consolidated
statement of cash flows, and the interest portion is presented as part of operating activities.
91
Hansen Technologies Ltd | Annual Report 2023 13. Leases (continued)
Critical accounting estimate and judgement
Determining the lease term of contracts with renewal and termination options – Group as a lessee
The Group determines the lease term as the non-cancellable term of the lease together with any periods covered by an
option to extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate
the lease, if it is reasonably certain not to be exercised.
The Group has several lease contracts that include extension and termination options. The Group applies judgement
in evaluating whether it is reasonably certain to exercise the option to renew or terminate the lease. That is, it considers
all relevant factors that create an economic incentive for it to exercise either the renewal or termination. After the
commencement date, the Group reassesses the lease term if there is a significant event or change in circumstances
that is within its control and affects its ability to exercise or not to exercise the option to renew or to terminate
(e.g. construction of significant leasehold improvements or significant customisation to the leased asset).
Estimating the incremental borrowing rate
The Group cannot readily determine the interest rate implicit in the lease, therefore, it uses its incremental borrowing
rate (IBR) to measure lease liabilities. The IBR is the rate of interest that the Group would have to pay to borrow over a
similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in
a similar economic environment. The IBR therefore reflects what the Group ‘would have to pay’, which requires estimation
when no observable rates are available (such as for subsidiaries that do not enter into financing transactions) or when they
need to be adjusted to reflect the terms and conditions of the lease (for example, when leases are not in the subsidiary’s
functional currency). The Group estimates the IBR using observable inputs (such as market interest rates) when available
and is required to make certain entity-specific estimates (such as the subsidiary’s stand-alone credit rating).
14. Payables
Trade payables
Accrued payables
Other payables
Total payables
Note
18(b)
2023
$’000
7,568
13,851
3,609
25,028
2022
$’000
5,385
14,200
4,404
23,989
Significant accounting policies
Trade payables
Trade payables are initially recognised at their fair value and subsequently carried at amortised cost and are not discounted.
These amounts represent liabilities for goods and services provided to the Group prior to the end of financial year which
are unpaid. The amounts are unsecured and are paid in accordance with vendor terms, which are usually within 30 to
60 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within
12 months after the reporting period.
92
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 15. Other operating provisions
Current
Onerous contract provisions
Other
Total current operating provisions(1)
Non-current
Make good provisions
Total non-current operating provisions(2)
Reconciliation of other operating provisions
Carrying amount at beginning of year
Net provisions/(payments/reversals) made during the year
Carrying amount at end of year
(1) Included within current provisions in the consolidated statement of financial position.
(2) Included within non-current provisions in the consolidated statement of financial position.
Significant accounting policies
Provisions
2023
$’000
513
57
570
300
300
1,376
(506)
870
2022
$’000
943
91
1,034
342
342
2,217
(841)
1,376
Provisions are recognised when the consolidated entity has a legal or constructive obligation, as a result of past events,
for which it is probable that an outflow of economic benefits will result, and that outflow can be reliably measured.
93
Hansen Technologies Ltd | Annual Report 2023 SECTION D: PEOPLE
This section provides information about our employee benefit obligations, including annual leave, long service leave
and post-employment benefits. It also includes details about our share plans and the compensation paid to key
management personnel.
16. Employee benefits
Current employee benefits(1)
Non-current employee benefits(2)
Total employee benefits liability
2023
$’000
13,557
109
13,666
2022
$’000
13,956
172
14,128
(1) Included within current provisions in the consolidated statement of financial position.
(2) Included within non-current provisions in the consolidated statement of financial position.
Employee Benefits Liability
Employee benefits liability represents amounts provided for annual leave and long service leave. The current portion for this
provision includes the total amount accrued for annual leave entitlements and the amounts accrued for long service leave
entitlements that have vested due to employees having completed the required period of service.
Based on past experience, the Group does not expect the full amount of annual leave or long service leave balances classified
as current liabilities to be settled within the next 12 months. These amounts are presented as current liabilities since the
Group does not have an unconditional right to defer the settlement of these amounts in the event employees wish to
use their leave entitlement.
(a) Directors’ and executives’ compensation
Short term employment benefits
Post-employment benefits
Share-based payments
Total
2023
$
3,945,132
150,070
656,618
4,751,820
2022
$
3,621,809
174,405
1,062,624
4,858,838
On 29 July 2022, an Executive KMP was made redundant. In relation to the Executive KMP rights that were yet to vest, the Board
of Directors exercised its discretionary power under the Employee Performance Rights Plan and allowed these rights to be
retained; and to vest on the effective termination date.
Detailed remuneration disclosures are provided in the remuneration report on pages 37 to 57.
94
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 Significant accounting policies
Short-term employee benefit obligations
Liabilities arising in respect of wages and salaries, annual leave, long service leave and any other employee benefits
expected to be settled within 12 months of the reporting date are measured at the amounts based on remuneration rates
that are expected to be paid when the liability is settled. The expected cost of short-term employee benefits in the form of
compensated absences such as annual leave and long service leave is recognised in the provision for employee benefits.
All other short-term employee benefit obligations are presented as payables.
Other long-term employee benefit obligations
The provision for other long-term employee benefits, including obligations for long service leave and annual leave,
which are not expected to be settled wholly before twelve months after the end of the reporting period, are measured
at the present value of the estimated future cash outflow to be made in respect of the services provided by employees
up to the reporting date. Expected further payments incorporate anticipated future wage and salary levels, durations of
service and employee turnover, and are discounted at rates determined by reference to market yields at the end of the
reporting period on high quality corporate bonds that have maturity dates that approximate the terms of the obligations.
Any re-measurements for changes in assumptions of obligations for other long-term employee benefits are recognised
in profit or loss in the periods in which the change occurs.
Other long-term employee benefit obligations are presented as current liabilities in the consolidated statement of financial
position if the entity does not have an unconditional right to defer settlement for at least twelve months after the reporting
date, regardless of when the actual settlement is expected to occur. All other long-term employee benefit obligations are
presented as non-current liabilities in the consolidated statement of financial position.
Retirement benefit obligations
The consolidated entity makes superannuation and pension contributions to the employee’s defined contribution plan
of choice in respect of employee services rendered during the year. These contributions are recognised as an expense
in the same period when the related employee services are received. The Group’s obligation with respect to employee’s
defined contributions entitlements is limited to its obligation for any unpaid superannuation and pension guarantee
contributions at the end of the reporting period. All obligations for unpaid superannuation and pension guarantee
contributions are measured at the (undiscounted) amounts expected to be paid when the obligation is settled and
are presented as current liabilities in the consolidated statement of financial position.
Bonus plan
The consolidated entity recognises a provision when a bonus is payable in accordance with the employee’s contract
of employment or review letter and the amount can be reliably measured.
Termination benefits
The Group recognises an obligation and expense for termination benefits at the earlier of: (a) the date when the Group
can no longer withdraw the offer for termination benefits; and (b) when the Group recognises costs for restructuring and
the costs include termination benefits. In either case, the obligation and expense for termination benefits is measured on the
basis of the best estimate of the number of employees expected to be affected. Termination benefits that are expected to
be settled wholly before twelve months after the annual reporting period in which the benefits are recognised are measured
at the (undiscounted) amounts expected to be paid and are presented as current liabilities in the consolidated statement of
financial position. All other termination benefits are accounted for on the same basis as other long-term employee benefits
and are presented as non-current liabilities in the consolidated statement of financial position.
95
Hansen Technologies Ltd | Annual Report 2023 17. Share-based payments
(a) Employee Performance Rights Plan
The Employee Performance Rights Plan (the Rights Plan) was approved by shareholders at the Company’s AGM on
23 November 2017 and was re-adopted at the Company’s AGM on 24 November 2022. Under the Plan, awards are made to
eligible executives and other management personnel who have an impact on the Group’s performance. Plan awards for long-term
incentives (LTI) are granted in the form of performance rights over shares which vest over a period of three years subject to meeting
performance measures and continuous employment with the Company. Plan awards for deferred short-term incentives (STI) are
deferred for a two-year period of which the employee must remain employed, following the achievement of annual financial and
non-financial performance measures. Each performance right is to subscribe for one ordinary share upon vesting and, when issued,
the shares will rank equally with other shares.
Performance rights issued under the Employee Performance Rights Plan are valued on the same basis as those issued to
KMP, which is described in Note 17(b).
Performance rights issued and outstanding as at 30 June 2023
Grant date
2 Sep 2019
2 Sep 2019
1 Jul 2020
1 Jul 2020
15 Sep 2021
15 Sep 2021
15 Sep 2022
15 Sep 2022
Total
Vesting date
30 Jun 2022(1)
30 Jun 2022(2)
30 Jun 2023(3)
30 Jun 2023(4)
30 Jun 2024(5)
30 Jun 2024(6)
30 Jun 2025(7)
30 Jun 2025(8)
Type
STI
LTI
STI
LTI
LTI
LTI
LTI
LTI
Fair Value
Per Right
$
No. of
Rights at
01/07/2022
Rights
Granted
3.11
2.83
2.70
2.77
4.99
5.29
3.74
4.30
78,384
646,600
594,707
212,622
235,424
95,049
–
–
1,862,786
–
–
–
–
–
–
430,059
67,889
497,948
Rights
Vested,
Forfeited
or Other
(78,384)
(646,600)
(71,460)
(13,319)
(28,975)
(10,747)
(47,708)
(6,210)
No. of
Rights at
30/06/2023
–
–
523,247
199,303
206,449
84,302
382,351
61,679
(903,403)
1,457,331
(1) Performance rights granted on 2 September 2019 in relation to STI measures have met the required measurement hurdles and vested at 100% on 30 June 2022.
The rights were exercised on 19 August 2022.
(2) Performance rights granted on 2 September 2019 in relation to EPSa CAGR and TSR measures have exceeded the required measurement hurdles and market
conditions, respectively and vested on an accelerated basis paying 150% of the entitlement on rights linked to EPSa CAGR measure and 137% of the entitlement
on rights linked to TSR measure on 30 June 2022. The rights were exercised on 19 August 2022.
(3) Majority of the performance rights in relation to the Enhanced STI Plan granted on 1 July 2020 have exceeded the required measurement hurdles, allowing an
accelerated basis paying up to 135% of the entitlement on 30 June 2023.
(4) Performance rights granted on 1 Jul 2020 in relation to EPSa CAGR and TSR measures have vested at 100% on 30 June 2023 based on the discretion
of the Board.
(5) Performance rights granted on 15 September 2021 with a fair value per right of $4.99 refers to rights linked to Group Revenue and TSR measures.
(6) Performance rights granted on 15 September 2021 with a fair value per right of $5.29 refers to rights linked to non-market performance conditions such as
Group Revenue and Regional Revenue; Product Revenue and Product Profit Margin.
(7) Performance rights granted on 15 September 2022 with a fair value per right of $3.74 (2021: $4.99) refers to rights linked to Revenue and TSR measures.
(8) Performance rights granted on 15 September 2022 with a fair value per right of $4.30 (2021: $5.29) refers to rights linked to non-market performance conditions
such as Revenue and Profit Margin.
All the unvested performance rights will be measured against specific measurement criteria as detailed in the preceding table
and will be awarded in the period following the measurement period.
96
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 Performance rights issued and outstanding as at 30 June 2022
Grant Date
2 Jul 2018
2 Sep 2019
2 Sep 2019
1 Jul 2020
1 Jul 2020
15 Sep 2021
15 Sep 2021
Total
Vesting Date
27 Aug 2021(1),(2)
30 Jun 2022(3)
30 Jun 2022(4)
30 Jun 2023(5)
30 Jun 2023
30 Jun 2024(6)
30 Jun 2024(7)
Type
LTI
STI
LTI
STI
LTI
LTI
LTI
Fair Value
per Right
$
No. of
Rights at
01/07/2021
Rights
Granted
3.01
3.11
2.83
2.70
2.77
4.99
5.29
448,841
78,384
463,588
448,501
239,313
–
–
1,678,627
–
–
–
–
–
235,424
107,556
342,980
Rights
Vested,
Forfeited
or Other
(448,841)
–
183,012
146,206
(26,691)
–
(12,507)
No. of
Rights at
30/06/2022
–
78,384
646,600
594,707
212,622
235,424
95,049
(158,821)
1,862,786
(1) The vesting date for rights granted on 2 July 2018 is the date on which the Board notifies the executive that the rights have vested, after the outcomes
for the measurement period have been determined and satisfaction of performance conditions have been assessed.
(2) Performance rights granted on 2 July 2018 in relation to EPSa CAGR and TSR measures have exceeded the required measurement hurdles and vested
on an accelerated basis paying 150% of the entitlement on 27 August 2021.
(3) Performance rights granted on 2 September 2019 in relation to STI measures have met the required measurement hurdles and vested at 100% on 30 June
2022.
(4) Performance rights granted on 2 September 2019 in relation to EPSa CAGR and TSR measures have exceeded the required measurement hurdles and market
conditions, respectively and vested on an accelerated basis paying 150% of the entitlement on rights linked to EPSa CAGR measure and 137% of the entitlement
on rights linked to TSR measure on 30 June 2022.
(5) Majority of the performance rights in relation to the Enhanced STI Plan granted on 1 July 2020 have exceeded the required measurement hurdles, allowing an
accelerated basis paying up to 135% of the entitlement on 30 June 2023.
(6) Performance rights granted on 15 September 2021 with a fair value per right of $4.99 refers to rights linked to Group Revenue and TSR measures.
(7) Performance rights granted on 15 September 2021 with a fair value per right of $5.29 refers to rights linked to non-market performance conditions such as
Revenue and Profit Margin.
The weighted average contractual life of outstanding performance rights at the end of the financial year is 0.81 year
(2022: 0.79 year).
(b) Fair value of performance rights granted
The fair value of Total Shareholder Return (TSR) performance rights at grant date is independently determined using an
adjusted form of the Black Scholes Model which includes a Monte Carlo simulation model that takes into account the term of
the performance rights, the impact of dilution (where material), the share price at grant date and expected price volatility of the
underlying share, the expected dividend yield, the risk-free interest rate for the term of the performance rights and the correlations
and volatilities of the peer group companies.
The fair value of Revenue and Profit Margin performance rights at grant date is independently determined using a conventional
Black Scholes Model.
97
Hansen Technologies Ltd | Annual Report 2023 17. Share-based payments (continued)
Details of the assessed fair value of the performance rights as well as the model inputs for rights granted, during the year
ended 30 June 2023 and for the prior year 30 June 2022, are presented below:
Grant date
Expected vesting date
Measurement period
Fair value of performance rights granted – Revenue and Profit
Margin
Fair value of performance rights granted – TSR rights
Share price at grant date
Expected price volatility of the company’s shares
Expected dividend yield
Risk-free interest rate
2023
15 September 2022
30 June 2025
2022
15 Sep 2021
30 June 2024
1 July 2022 to 30 June 2025 1 July 2021 to 30 June 2024
$4.30
$3.18
$4.64
32.5%
2.47%
3.28%
$5.29
$4.69
$5.60
30%
2.06%
0.61%
The expected price volatility is based on the historic volatility (based on the life of the performance rights), adjusted for any
expected changes to future volatility due to publicly available information.
(c) Expenses arising from share-based payment transactions
Rights issued under employee performance rights plan FY20
Rights issued under employee performance rights plan FY21
Rights issued under employee performance rights plan FY22
Rights issued under employee performance rights plan FY23
Total
5, 8(a), 22(b)
Note
2023
$’000
–
483
459
586
1,528
2022
$’000
1,055
764
618
–
2,437
98
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 Significant accounting policies
Share-based payments
The Group operates equity-settled share-based payment employee share, options and rights schemes. The fair value of
the equity to which employees become entitled is measured at grant date and recognised as an expense over the vesting
period, with a corresponding increase to an equity account, ending on the date on which the relevant employees become
fully entitled to the award (the vesting date). The fair value of shares is measured at the market bid price at grant date. In
respect of share-based payments that are dependent on the satisfaction of performance conditions, the number of options
and rights expected to vest is reviewed and adjusted at each reporting date. The amount recognised for services received
as consideration for these equity instruments granted is adjusted to reflect the best estimate of the number of equity
instruments that eventually vest.
Share-based payments are subject to two different forms of measurement:
• Market-based
• Non-market-based
These measurement criteria are subject to different accounting treatments under AASB 2 Share-based Payment.
Market-based measurement
Any awards subject to market conditions will vest irrespective of the condition being met. Where a condition is not met,
the expense associated with the award will continue to be recognised over the vesting period.
Non-market-based measurement
For any non-market-based awards where the condition is not satisfied, the expense incurred to date is reversed
and no further charge is recognised over the remaining period.
Critical accounting estimate and judgement
Share-based payments
The fair value of rights is estimated on the grant date using an adjusted form of the Black Scholes Model and Monte Carlo
simulation model. Estimating fair value for share-based payments requires significant assumptions such as determining
the most appropriate inputs to the valuation model, including the expected life of the share option or performance right,
volatility in the share price and dividend yield.
99
Hansen Technologies Ltd | Annual Report 2023 SECTION E: CAPITAL AND FINANCIAL RISK MANAGEMENT
This section explains our policies and procedures applied to manage our financing and capital structure, and
the associated risks that we are exposed to. The Group manages its financial and capital structure to maximise
shareholder return, maintain an optimal cost of capital and provide flexibility for strategic investments.
18. Financial risk management
The Group is exposed to a variety of financial risks, principally related to credit, liquidity, interest rate and foreign currency
risk. The Group’s risk management framework is aligned with best practices and designed to reduce volatility on our financial
performance and to support the delivery of our business objectives. The Board has overall responsibility for identifying and
monitoring operational and financial risks.
(a) Credit risk
Nature of risk
Exposure to the risk
The risk of financial loss to the Group if a customer or counterparty to a financial instrument fails
to meet its contractual obligations. Credit risk arises principally from the Group’s receivables from
customers and our investments in debt securities.
The Group’s maximum exposure to credit risk at 30 June 2023 and 30 June 2022 is the carrying
amount of financial assets, net of any provisions for impairment and excluding the value of any
collateral or other security.
The gross trade receivables balance as at 30 June 2023 was $55,608,000 (2022: $56,534,000).
The ageing analysis of trade and other receivables is provided in Note 9. As the Group undertakes
transactions with a large number of customers and regularly monitors payment in accordance with
credit terms, the financial assets that are past due but not impaired, are expected to be received.
The Group’s exposure to credit risk is affected by the regions and industries our customers
operate in. Set out below shows the concentration of our trade receivables balances by the
industry they operate in.
FY23
2%
54%
44%
Energy
Communications
Other
66%
FY22
1%
33%
How is the risk managed? Receivables are managed on an ongoing basis. The Group does not have any material credit risk
exposure to any single debtor or group of debtors. Ageing analysis and ongoing collectability reviews
are performed and, where appropriate, an expected credit loss provision is raised. Historically,
the Group has not had any significant write-offs in our trade receivables.
The Group minimises concentrations of credit risk in relation to trade receivables by undertaking
transactions with a large number of customers. The credit quality of a customer is assessed
based on a variety of factors, including their credit ratings and financial position.
100
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 (b) Liquidity risk
Nature of risk
Exposure to the risk
The risk that the Group will encounter difficulty in meeting its financial obligations as they fall due.
The table below categorises the Group’s financial liabilities into their relevant contractual maturities.
Amounts included represent undiscounted cash flows.
Note 19 provides additional details on the Group’s borrowing arrangements.
How is the risk managed? The Group’s approach is to ensure, as far as possible, that it will have sufficient liquidity to meet
its liabilities when they are due, under both normal and stressed conditions, without incurring
unacceptable losses or risking damage to the Group’s reputation.
The Group reviews its minimum levels of cash and cash equivalents on an ongoing basis, and
closely monitors rolling cash flow forecasts based on its view on the nature and timing of expected
receipts and payments. The Group has historically been able to generate and retain strong positive
cash flows. Additionally, a multi-currency borrowing facility has been arranged with the Group’s
financiers to provide increased capacity for strategic growth objectives.
Contractual maturities of financial liabilities
The table below summarises the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments
as at 30 June 2023 and 2022.
Financial liabilities
2023
Trade and other payables
Lease liabilities(1)
Secured borrowings(2)
Total
2022
Trade and other payables
Lease liabilities(1)
Secured borrowings(3)
Total
Note
14
13(e)
19
14
13(e)
19
Contractual cash flows $’000
Less than
6 months
6-12
months
1-2
years
2-3
years
> 3
years
Total
payments
25,028
3,280
–
28,308
23,989
3,308
–
27,297
–
2,900
–
2,900
–
2,918
–
2,918
–
3,389
54,716
58,105
–
3,878
88,151
92,029
–
2,366
–
2,366
–
1,875
–
1,875
–
5,634
–
5,634
–
3,970
–
25,028
17,569
54,716
97,313
23,989
15,949
88,151
3,970
128,089
(1) Lease liabilities are recognised and disclosed at present value in accordance with AASB 16 and the Group accounting policy.
(2) As at 8 June 2023, the syndicated mutli-currency borrowing facility was refinanced with a maturity date of 31 July 2025.
(3) As at 4 August 2021, the syndicated multi-currency borrowing facility was extended to 1 September 2023.
(c) Interest rate risk
Nature of risk
Exposure to the risk
The risk that the fair value or the future cash flows of a financial instrument will fluctuate as a result
of changes in market interest rates.
The Group’s main exposure to interest rate risk arises from its lease liabilities, borrowings and cash
and cash equivalents. No other financial assets or liabilities are expected to be exposed to interest
rate risk. The weighted average variable interest rate across all our borrowings at 30 June 2023
is 5.50% (2022: 2.34%). If the interest rate were to increase or decrease by 1%, with all other
variables held constant, the impact to pre-tax profit is $791,000 (2022: $1,233,000) and
the impact to post-tax equity(1) is $569,000 (2022: $886,000).
How is the risk managed? The Group ensures it has access to diverse sources of funding, including access to foreign currency
debt. The Group closely monitors its debt ratios to reduce its risk exposure to uncertainty in the
global markets if interest rates will fall or rise. Management is comfortable with the risk associated
with using variable interest rates due to the current level of borrowings.
(1) Post-tax equity is calculated as the net of the blended effective tax rate on pre-tax profit based on where the interest-bearing debt is located (i.e., Australia and
Canada) and the prevailing corporate tax rate in each of those jurisdictions (i.e., 30% and 26.5% respectively).
101
Hansen Technologies Ltd | Annual Report 2023 18. Financial risk management (continued)
(d) Foreign currency risk
Nature of risk
Exposure to the risk
The risk that the fair value or future cash flows of a financial instrument or forecasted transaction
will fluctuate because of changes in foreign exchange rates.
The Group operates internationally and as such has exposure to foreign currency movements.
The Group has expanded its international operations substantially in recent years to the extent
that in excess of 83% (2022: 83%) of its revenue is now earned in foreign currency designated
transactions. The Group has a number of offices located internationally and more than 89%
(2022: 88%) of its work force is located overseas and paid in foreign currencies.
Changes in foreign currency exchange rates would be limited to the revaluation of foreign
currency denominated borrowings, intercompany financing arrangements denominated in foreign
currencies, and foreign currency bank balances in the Group at market rates at consolidated
statement of financial position date.
The Group’s primary foreign currency exposure relates to the movement in US Dollar (USD),
British Pound (GBP), Canadian Dollar (CAD) and Euro (EUR) exchange rates. At the reporting
date, cash and cash equivalents included $47.0 million (2022: $49.0 million) denominated
in foreign currencies.
If the foreign currency exchange rate for our primary foreign currencies (USD, GBP, CAD and EUR)
were to move by 10%, with all other variables held constant, the impact to our foreign currency
translation reserves (included within ‘Equity’ in the consolidated statement of financial position)
on translation of our foreign currency-denominated cash and cash equivalents
is as follows:
Increase/(decrease) $’000
USD
GBP
CAD
EUR
2023
1,098
(1,098)
2022
790
(790)
2023
1,010
(1,010)
2022
2023
2022
553
(553)
396
(396)
619
(619)
2023
1,415
(1,415)
2022
2,133
(2,133)
+10%
-10%
The Group’s exposure to foreign currency changes for all other currencies and other financial
statement items is not material, as the Group has natural hedging and designated hedging
relationships in place (refer to “How is the risk managed?” for a further explanation).
How is the risk managed? The Group manages its foreign currency risk by evaluating its exposure to fluctuations on an
ongoing basis.
The Group’s overseas subsidiaries transact in different functional currencies. The effects of any
exchange rate movements in respect of the net assets of our foreign subsidiaries are recognised
in the foreign currency translation reserve in equity. Accordingly, the Group has an in-built natural
hedge against major currency fluctuations and, except for significant sudden change, is protected
in part by its corporate structure against currency movements so that the impact is largely limited
to the margin.
In addition, during the financial year, the Group held a foreign currency borrowing as part of the
syndicated multi-currency borrowing facility agreement as disclosed in Note 19, which has been
designated as a hedging instrument of the net assets of some of the Group’s principal overseas
subsidiaries in order to offset our risk exposure arising from the translation of these subsidiaries
into Australian dollars. There is no impact to the profit or loss on the translation of the Group’s
overseas subsidiaries or foreign currency borrowings to the Australian dollar.
The Group’s subsidiaries also enter into various financing and transactional arrangements with
each other in accordance with local regulatory requirements. The Group regularly reviews these
arrangements to minimise its exposure on the translation of outstanding foreign currency-
denominated intercompany balances to the Australian dollar, which impact profit.
102
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 Significant accounting policies
Functional and presentation currency
The financial statements of each entity within the consolidated Group are measured using the currency of the primary
economic environment in which that entity operates. The consolidated financial statements of the Group are presented
in Australian dollars, which is the Group’s functional and presentation currency.
Foreign currency transactions and balances
Transactions in foreign currencies of entities within the consolidated Group are translated into its functional currency
at the rate of exchange ruling at the date of the transaction.
Foreign currency monetary items that are outstanding at the reporting date (other than monetary items arising under foreign
currency contracts where the exchange rate for that monetary item is fixed in the contract) are translated using the spot
rate at the end of the financial year.
All resulting exchange differences arising on settlement or re-statement are recognised in profit or loss and presented
in the consolidated statement of comprehensive income for the financial year.
(e) Fair value measurements
Due to their short-term nature, the fair value of receivables and payables approximates their carrying amounts as disclosed
in the consolidated statement of financial position and notes to the consolidated financial statements. At 30 June 2023
and 30 June 2022, there are no assets or liabilities carried at fair value on a recurring basis.
19. Borrowings
Non-current
Secured
Term facility – gross borrowings
Term facility – net prepaid borrowing costs
Total
Note
18(b)
2023
$’000
2022
$’000
54,716
(407)
54,309
88,151
(239)
87,912
At the beginning of the year, the Group had a $123 million syndicated multi-currency facility with its external financiers, which
was used to fund a previous acquisition and to provide additional funding for general corporate and working capital purposes.
As at 31 December 2022, the remaining drawn down balance of $65 million had a maturity period of less than twelve months,
therefore Management had reclassified the debt as current.
On 8 June 2023, the Group refinanced the facility with its external financers with a maturity period of twenty-one months,
expiring on 31 July 2025, Management has therefore reclassified the debt as non-current as at 30 June 2023. The average
interest rate of the borrowings is 6.19%.
103
Hansen Technologies Ltd | Annual Report 2023 19. Borrowings (continued)
(a) Changes in liabilities arising from financing activities
Opening balance at 1 July
Cash flows from financing activities
Net repayment of borrowings
Cash flows from non-financing activities
Established of loan fees – paid
Non-cash changes
Amortisation of prepaid borrowing costs
Effect of foreign exchange
Closing balance at 30 June
Significant accounting policies
Loans and borrowings
Note
5, 8(a)
2023
$’000
87,912
2022
$’000
117,507
(33,615)
(33,974)
(201)
151
62
54,309
(400)
1,592
3,187
87,912
Interest-bearing loans and borrowings are initially recognised as financial liabilities at fair value net of directly attributable
transaction costs. After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised
cost using the effective interest rate (EIR) method. Gains and losses are recognised in profit or loss when the liabilities are
derecognised as well as through the EIR amortisation process.
Borrowings are classified as non-current liabilities except for those that mature in less than 12 months from the reporting
date, which are classified as current liabilities, unless the borrower has the discretion to refinance or rollover the borrowings.
Borrowing costs
Borrowing costs can include interest expense calculated using the effective interest method and finance charges in respect
of finance leases. Borrowing costs are expensed as incurred except for borrowing costs incurred as part of the construction
of a qualifying asset, in which case the costs are capitalised until the asset is ready for its intended use or sale.
104
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 20. Contributed capital
(a) Issued and paid-up capital
Ordinary shares, fully paid
Total
(b) Movements in shares on issue
2023
$’000
148,688
148,688
2022
$’000
146,857
146,857
Ordinary Shares
(excluding
Treasury
Shares) Treasury Shares
Total Share Capital
Balance at 1 July 2021
No. of Shares
No. of Shares
No. of Shares
199,845,539
–
199,845,539
Shares issued to satisfy future rights exercises
–
1,171,783
1,171,783
Shares issued under the dividend reinvestment plan
Performance rights exercised
287,678
673,268
–
–
287,678
673,268
$’000
145,224
–
1,633
–
Balance at 30 June 2022
Shares issued to satisfy future rights exercises
Shares issued under the dividend reinvestment plan
Performance rights exercised
Balance at 30 June 2023
200,806,485
1,171,783
201,978,268
146,857
–
200,352
382,167
752,560
–
(556,074)
200,352
382,167
196,486
–
1,831
–
201,941,212
816,061
202,757,273
148,688
Treasury shares are shares in the Company that are held by Hansen Technologies Limited Employee Share Plan Trust (the Trust)
for the purpose of holding shares for the satisfaction of rights under the existing and future equity award plans. The Trust was
established on 24 June 2022.
The Trust provides the Group with greater flexibility to accommodate its incentive arrangements both now and into the future.
The Trust helps manage the capital requirements, and can use the contributions made by Hansen either to acquire shares in
Hansen on market, or alternatively to subscribe for new Hansen shares. The Trust provides an arm’s length vehicle to acquire
and hold Hansen shares on behalf of employees and allows Hansen to satisfy Corporations Law requirements relating to
companies dealing in their own shares as well as assisting with management of insider trading restrictions. Pacific Custodians
Pty Limited, an independent third party, is the Trustee of the Trust, and operates the Trust in accordance with Hansen
Technologies Limited Employee Share Plan Trust Deed.
Where there are unallocated shares within the Trust, the Trustee may apply any capital receipts, dividends or other distributions
received to purchase further shares and/or to pay any reasonable disbursements associated with the operation of the Trust.
(c) Rights of each type of share
Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the number
of shares held. At shareholders meetings, each ordinary share is entitled to one vote when a poll is called.
(d) Capital risk management
The Group’s objectives when managing capital are to safeguard its ability to continue as a going concern, so that it can continue
to provide returns for shareholders and benefits for other stakeholders while maintaining an optimal capital structure to reduce
the cost of capital. 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, increase debt, sell assets to reduce debt or a combination
of these activities.
The capital risk management policy remains unchanged from the 30 June 2022 Financial Report.
105
Hansen Technologies Ltd | Annual Report 2023 21. Dividends
A final dividend of 5 cents per share has been declared, partially franked to 1.5 cents per share. This final dividend was
announced to the market on 23 August 2023, and will subsequently be paid on 20 September 2023. The amount declared
has not been recognised as a liability in the accounts of Hansen Technologies Limited as at 30 June 2023.
Dividends paid during the year (net of dividend re-investment)
5 cents per share final dividend paid 21 September 2022 – partially franked(1)
5 cents per share final dividend paid 21 September 2021 – partially franked(2)
5 cents per share interim dividend paid 21 March 2023 – unfranked(3)
7 cents per share interim dividend paid 21 March 2022 – partially franked(4)
Total
Proposed dividend not recognised at the end of the year
Dividends franking account
30% franking credits, on a tax paid basis, are available to shareholders
of Hansen Technologies Ltd for subsequent financial years
2023
$’000
9,166
–
9,237
–
18,403
10,138
2022
$’000
–
9,081
–
13,359
22,440
10,099
–
1,283
(1) The final dividend paid of 5 cents per share franked to 1.5 cents, comprised of a regular dividend of 5 cents per share.
(2) The final dividend paid of 5 cents per share franked to 2.7 cents, comprised of a regular dividend of 5 cents per share.
(3) The interim dividend of 5 cents per share, unfranked, comprised of a regular dividend of 5 cents per share.
(4) The interim dividend of 7 cents per share franked to 3.5 cents, comprised of a regular dividend of 5 cents per share and a special dividend of 2 cents per share.
The above prior year available amounts are based on the balance of the dividend franking account at year end adjusted for:
• franking credits that will arise from the payment of any current tax liability;
• franking debits that will arise from the payment of any dividends recognised as a liability at year end;
• franking credits that will arise from the receipt of any dividends recognised as receivables at year end; and
• franking credits that the entity may be prevented from distributing in subsequent years.
106
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 22. Reserves and retained earnings
Foreign currency translation reserve
Share-based payments reserve
Retained earnings
Note
22(a)
22(b)
22(c)
2023
$’000
7,259
12,285
170,648
2022
$’000
7,536
10,629
148,086
(a) Foreign currency translation reserve
This reserve is used to record the exchange differences arising on translation of a foreign entity.
Movements in reserve
Balance at 1 July
Net gain on hedges of a net investment
Exchange differences on translation of foreign operations
Balance at 30 June
Note
2023
$’000
7,536
–
(277)
7,259
2022
$’000
5,105
26
2,405
7,536
(b) Share-based payments reserve
This reserve is used to record the fair value of options and performance rights issued to employees as part of their remuneration.
Movements in reserve
Balance at 1 July
Share-based payments expensed during the year
Tax associated with the share-based payments plan
Balance at 30 June
(c) Retained earnings
Movements in retained earnings
Balance at 1 July
Dividends declared during the year
Net profit after income tax expense for the year
Balance at 30 June
Note
17(c)
6(b)(iv)
Note
2023
$’000
10,629
1,528
128
12,285
2023
$’000
148,086
(20,233)
42,795
170,648
2022
$’000
7,971
2,437
221
10,629
2022
$’000
130,219
(24,073)
41,940
148,086
23. Commitments and contingencies
Commitments on leases
Lease commitments are disclosed in Note 18 and Note 13(e).
Contingent assets and liabilities
At 30 June 2023 and 2022, the Group does not have any contingent assets and liabilities.
107
Hansen Technologies Ltd | Annual Report 2023 SECTION F: GROUP STRUCTURE
This section provides information about our structure and how this impacts the Group’s results as a whole, including
parent entity information and any business acquisitions that impacted the Group’s financial position and performance.
24. Parent entity information
Presented below are the summary financial statements of the parent Company, Hansen Technologies Limited:
(a) Summarised statement of financial position
Assets
Current Assets
Non-current assets
Total Assets
Liabilities
Current liabilities
Non-current liabilities
Total Liabilities
Net assets
Equity
Share capital
Accumulated profits
Share based payments reserve
Foreign currency translation reserve
Total equity
(b) Summarised statement of comprehensive income
Profit after income tax expense
Total comprehensive income for the year
Parent Entity
2023
$’000
2022
$’000
360
190,636
190,996
557
11,753
12,310
178,686
1,905
201,430
203,335
201
24,167
24,368
178,967
148,688
146,857
19,029
12,285
(1,316)
22,797
10,629
(1,316)
178,686
178,967
Parent Entity
2023
$’000
16,454
16,454
2022
$’000
7,761
7,787
Dividends of $17,456,900 (2022: $8,900,000) were paid from Hansen Corporation Pty Limited to Hansen Technologies Limited
during the financial year.
108
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 (c) Parent entity guarantees
Hansen Technologies Limited, being the parent entity, has a syndicated multi-currency borrowing facility (refer to Note 19) of
which Hansen Corporation Pty Limited and other subsidiaries of the Company are joint guarantors to that facility agreement.
A Deed of Parent Guarantee and Indemnity also exists between Hansen Technologies Limited and Hansen Technologies Canada
Inc. a wholly-owned subsidiary, in favour of a financing company based in Canada for a credit card facility. In addition, there are
cross guarantees given by Hansen Technologies Limited and Hansen Corporation Pty Limited as described in Note 27.
No deficiencies of assets exist in any of these companies.
Significant accounting policies
The financial information for the parent Company has been prepared on the same basis as the Group consolidated
financial statements, except as set out below:
Investments in subsidiaries
Investments in subsidiaries are accounted at cost. Dividends received from subsidiaries are recognised in the parent
entity’s statement of comprehensive income when its right to receive the dividend is established.
Where the parent Company has provided financial guarantees in relation to loans and payables of subsidiaries for no
compensation, the fair value of these guarantees is accounted for as contributions and recognised as part of the cost
of the investment.
109
Hansen Technologies Ltd | Annual Report 2023 SECTION G: OTHER DISCLOSURES
This section includes other disclosures not included in the other sections, for example the Group’s auditor’s
remuneration, related parties, impact of new accounting standards not yet effective and subsequent events.
25. Related party disclosures
(a) List of controlled entities
The Group’s consolidated financial statements include the financial statements of Hansen Technologies Limited and the
controlled entities below:
Name
Parent entity
Hansen Technologies Limited
Subsidiaries of Hansen Technologies Limited
Hansen Corporation Pty Limited
Hansen Corporation Investments Pty Limited
Hansen Holdings (Asia) Pty Limited(1)
Utilisoft Pty Limited
Hansen Technologies (Shanghai) Company Limited
Hansen Technologies Denmark A/S
Hansen Technologies CIS Finland Oy
Hansen Technologies Finland Oy
PEP Finland Oy
Enercube Oy Finland Filial
Hansen Customer Support India Private Limited
Hansen Technologies Netherlands B.V.
Hansen New Zealand Limited
Hansen Technologies Holdings AS
Hansen Technologies Norway AS
Hansen Technologies Sweden AB
Enoro AG
Hansen Corporation Europe Limited
Hansen Holdings Europe Limited
Hansen Billing Solutions Limited
Hansen Operations, LLC(2)
Hansen Solutions, LLC
Hansen Technologies North America, Inc.
Hansen ICC, LLC
Hansen Banner, LLC
Peace Software Inc.
Hansen Technologies Vietnam, LLC
Hansen Technologies Canada, Inc.(3)
Sigma Systems Canada LP(3)
Sigma Canada Holdings Inc.
Sigma Systems GP Inc.(3)
Hansen Systems Private Limited (fka.Sigma OSS Systems India Private Limited)
Sigma Systems Japan K.K.
Hansen Technologies CDE Limited
Sigma Systems (Wales) Limited
Sigma Systems Group (USA) Inc.(4)
Hansen Technologies SA(5)
Hansen Technologies Limited Employee Share Plan Trust
(1) Hansen Holdings (Asia) Pty Limited was a dormant entity that was deregistered on 2 June 2023.
(2) Hansen Operations, LLC was dissolved on 1 March 2023.
Country of
Incorporation
Australia
Australia
Australia
Australia
Australia
China
Denmark
Finland
Finland
Finland
Finland
India
Netherlands
New Zealand
Norway
Norway
Sweden
Switzerland
United Kingdom
United Kingdom
United Kingdom
United States
United States
United States
United States
United States
United States
Vietnam
Canada
Canada
Canada
Canada
India
Japan
United Kingdom
United Kingdom
United States
Argentina
Australia
Ordinary Shares
Equity Interest
2023
%
2022
%
100
100
–
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
–
100
100
100
100
100
100
100
–
100
–
100
100
100
100
–
100
–
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
–
–
(3) Sigma Systems GP Inc and Hansen Technologies Canada Inc were sole partners in Sigma Systems Canada LP, a limited partnership in Canada. On 31 December
2022, Sigma Systems GP Inc, sold all of its partnership units in Sigma Systems Canada LP to Hansen Technologies Canada Inc. Upon the sale of partnership units, the
partnership was dissolved by operation of law and Hansen Technologies Canada Inc. now carries on the business formerly carried on by the limited partnership as a sole
proprietor.
(4) Sigma Systems Group (USA) Inc. was dissolved on 23 May 2022.
(5) At the end of the previous financial year, Hansen Technologies Limited was in the process of registering as a foreign company in Argentina and transferring the legal
ownership of Hansen Technologies SA (HTSA). The transfer of legal ownership was completed on 1 November 2022. HTSA is a company registered in Argentina
on 7 December 2021 of which Hansen Technologies Limited gained control over as defined under AASB 10 Consolidated Financial Statements since the previous
financial year.
110
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 Significant accounting policies
Foreign subsidiaries
Subsidiaries that have a functional currency different to the presentation currency of the Group are translated as follows:
• assets and liabilities are translated at year-end exchange rates prevailing at that reporting date;
• income and expenses are translated at actual exchange rates or average exchange rates for the period, where
appropriate; and
• all resulting exchange differences arising on translation of foreign operations are transferred directly to the Group’s foreign
currency translation reserve as a separate component of equity in the consolidated statement of financial position.
Exchange differences arising on the reduction of a foreign subsidiary’s equity continues to be recognised in the Group’s
foreign currency translation reserve until such time that the foreign subsidiary is disposed of.
(b) Transactions with Key Management Personnel of the entity or its parent and their personally
related entities
The terms and conditions of the transactions with Directors and their Director-related entities were no more favourable than those
available, or which might reasonably be expected to be available, on similar transactions to non-Director-related entities on an
arm’s length basis.
The following table provides the total amount of transactions that were entered into with related parties in respect of leased
premises for the relevant financial year:
Leased premises
A related party to the Directors(1) – rental payments
A related party, Andrew Hansen – rental payments
2023
$
2022
$
–
1,637,017
40,713
40,713
90,973
1,727,990
(1) Andrew Hansen, Bruce Adams and David Osborne held a joint interest to the Melbourne head office and South Melbourne property of which the Group pays
monthly rental payments.
The properties leased in South Melbourne and the Group’s Melbourne head office have been sold to non-related parties on
17 June 2022 and on 29 July 2022, respectively. From these dates onwards, transactions relating to these leased properties
have ceased to be related party transactions of the Group.
111
Hansen Technologies Ltd | Annual Report 2023 26. Auditor’s remuneration
The auditor of the Group for the year ended 30 June 2023 is RSM Australia Partners.
(a) Amounts paid and payable to RSM Australia for:
(i) Audit and other assurance services
– an audit and/or review of the Financial Report
of the entity and any other entity in the consolidated entity
(ii) Other non-audit services
– compliance services
Sub-total
Total remuneration of RSM Australia Partners
(b) Amounts paid and payable to network firms of RSM Australia for:
(i) Audit and other assurance services
– an audit and/or review of the Financial Report
of the overseas entities in the consolidated entity
(ii) Other non-audit services
– taxation services
– compliance services
Sub-total
Total remuneration of network firms of the auditor
(c) Amounts paid and payable to non-related auditors for:
(i) Audit and other assurance services
– an audit and/or review of the Financial Report
of the entity and any other entities in the consolidated entity
(ii) Other non-audit services
– taxation services
– compliance services
Sub-total
Total remuneration of non-related auditors
Total auditors’ remuneration
2023
$
2022
$
396,000
332,055
13,715
13,715
409,715
3,567
3,567
335,622
364,402
564,819
39,636
48,149
87,785
452,187
65,444
54,776
120,220
685,039
86,147
20,453
61,546
51,690
113,236
199,383
9,095
28,475
37,570
58,023
1,061,285
1,078,684
112
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 27. Deed of cross guarantee
Hansen Technologies Limited and Hansen Corporation Pty Limited are parties to a deed of cross guarantee under which each
company guarantees the debts of the other. By entering into the deed, the wholly-owned entities have been relieved from the
requirement to prepare a financial report and directors’ report under ASIC Corporations (Wholly-owned Companies) Instrument
2016/785 issued by the Australian Securities and Investments Commission.
The above companies represent a ‘closed group’ for the purposes of the Class Order, and as there are no other parties to the
deed of cross guarantee that are controlled by Hansen Technologies Limited, they also represent the ‘extended closed group’.
(a) Consolidated statement of comprehensive income
Set out below is a consolidated statement of comprehensive income for the financial year ended 30 June 2023 of the closed
group consisting of Hansen Technologies Limited and Hansen Corporation Pty Limited (“the Closed Group”).
Revenue
Other income
Total revenue and other income
Employee benefit expenses
Depreciation expense
Amortisation expense
Property and operating rental expenses
Contractor and consultant expenses
Software licence expenses
Hardware and software expenses
Travel expenses
Communication expenses
Professional expenses
Finance costs on borrowings
Finance costs on lease liabilities
Foreign currency gains/(losses)
Other expenses
Total expenses
Profit before income tax expense
Income tax expense
Profit after income tax expense
Other comprehensive income
Items that may be reclassified subsequently to profit and loss
Net gain on hedges of net investments
Other comprehensive income for the year
Total comprehensive income for the year
Note
2023
$’000
50,291
30,655
80,946
(26,898)
(2,966)
(4,641)
(1,561)
(10)
(1,441)
(8,557)
(810)
(416)
(2,058)
(1,130)
(100)
(489)
(602)
2022
$’000
49,689
32,693
82,382
(26,237)
(2,378)
(3,982)
(1,549)
(69)
(1,268)
(6,730)
(382)
(362)
(2,222)
(1,941)
(109)
(498)
(489)
(51,679)
(48,216)
29,267
(2,987)
26,280
34,166
(2,608)
31,558
–
–
26
26
26,280
31,584
113
Hansen Technologies Ltd | Annual Report 2023 27. Deed of cross guarantee (continued)
(b) Consolidated statement of financial position
Set out below is a consolidated statement of financial position as at 30 June 2023 of the Closed Group:
Current assets
Cash and cash equivalents
Receivables
Accrued revenue
Current tax asset
Other current assets
Total current assets
Non-current assets
Plant, equipment & leasehold improvements
Intangible assets
Right-of-use assets
Other non-current assets
Deferred tax assets
Total non-current assets
Total assets
Current liabilities
Payables
Lease liabilities
Current tax payable
Provisions
Unearned income
Total current liabilities
Non-current liabilities
Deferred tax liabilities
Borrowings
Lease liabilities
Other non-current liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Share capital
Foreign currency translation reserve
Share-based payments and other reserves
Retained earnings
Total equity
Note
2023
$’000
7,106
9,266
2,904
–
3,938
23,214
6,093
29,229
2,550
214,950
3,101
255,923
279,137
7,269
1,247
365
5,804
5,972
20,657
6,153
11,417
1,543
4,482
109
23,704
44,361
234,776
148,688
(1,340)
8,818
78,610
234,776
(c) Summary of movements in consolidated retained earnings of the Closed Group
Retained earnings at the beginning of the year
Profit for the year
Dividends declared during the year
Retained earnings at the end of the year
114
Note
27(a)
27(b)
2023
$’000
72,563
26,280
(20,233)
78,610
2022
$’000
10,604
10,121
2,873
1,794
6,221
31,613
6,743
26,589
3,039
214,289
3,997
254,657
286,270
9,351
1,027
–
6,867
6,843
24,088
5,687
23,761
2,251
5,080
172
36,951
61,039
225,231
146,857
(1,340)
7,151
72,563
225,231
2022
$’000
65,078
31,558
(24,073)
72,563
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 28. New and amended accounting standards and interpretations
(a) Adoption of new and amended accounting standards that are first operative at 30 June 2023
The Group has adopted the following new and amended accounting standards and interpretations, applicable and effective
for the financial year beginning 1 July 2022:
• Reference to the Conceptual Framework – Amendments to AASB 3 Business Combinations
• Property, plant and equipment: Proceeds before intended use – Amendments to AASB 116 Property, plant and equipment
• Onerous contracts – Costs of fulfilling a contract – Amendments to AASB 137 Provisions, Contingent Liabilities and
Contingent Assets
• Fees in the ’10 per cent’ test for derecognition of financial liabilities – AASB 9 Financial Instruments
These new and amended accounting standards do not have a significant impact on the financial report and therefore the
disclosures have not been made.
The Group has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective.
Where necessary, comparative information has been reclassified and repositioned for consistency with current year disclosures.
(b) Accounting standards and interpretations issued but not operative at 30 June 2023
The following new and revised accounting standards and interpretations have been issued by the Australian Accounting
Standards Board at the reporting date, which are considered relevant to the Group but are not yet effective. The Directors’
assessment of the impact of these standards and interpretations is set out below:
(i) Amendments to AASB 101: Classification of Liabilities as Current or Non-current
These amendments revise AASB 101 to specify the requirements for classifying liabilities as current or non-current.
The amendments clarify (a) what is meant by a right to defer settlement; (b) that a right to defer must exist at the end
of the reporting period; (c) that classification is unaffected by the likelihood that an entity will exercise its deferral right;
(d) that only if an embedded derivative in a convertible liability is itself an equity instrument would the terms of a liability
not impact its classification.
Group’s assessment performed to date
The amendments are effective for annual reporting period beginning 1 July 2023 and must be applied retrospectively.
The amendments are not expected to have a material impact to the Group.
(ii) Definition of Accounting Estimates – Amendments to AASB 108 Accounting Policies, Changes in Accounting
Estimates and Errors
The amendments clarify the distinction between changes in accounting estimates and changes in accounting policies and the
correction of errors. Also, they clarify how entities use measurement techniques and inputs to develop accounting estimates.
Group’s assessment performed to date
The amendments are effective for annual reporting periods beginning on or after 1 July 2023 and apply to changes in accounting
policies and changes in accounting estimates that occur on or after the start of that period. The amendments are not expected
to have a material impact to the Group.
115
Hansen Technologies Ltd | Annual Report 2023 28. New and amended accounting standards and interpretations (continued)
(iii) Disclosure of Accounting Policies – Amendments to AASB 101 Presentation of Financial Statements and AASB
Practice Statement 2 Making Materiality Judgements
The amendments aim to help entities provide accounting policy disclosures that are more useful by replacing the requirement for
entities to disclose their “significant” accounting policies with a requirement to disclose their “material” accounting policies and
adding guidance on how entities apply the concept of materiality in making decisions about accounting policy disclosures.
Group’s assessment performed to date
The amendments to AASB 101 are applicable for annual periods beginning on or after 1 July 2023 with earlier application
permitted. Since the amendments to the Practice Statement 2 provide non-mandatory guidance on the application of the
definition of material to accounting policy information, an effective date for these amendments is not necessary. The Group does
not expect that these amendments have a significant impact on the Group’s accounting policy disclosures.
(iv) Deferred Tax related to Assets and Liabilities arising from a Single Transaction – Amendments to
AASB 112 Income Taxes
The amendments clarify the accounting for deferred tax on transactions that, at the time of transaction, give rise to equal taxable
and deductible temporary differences. In specified circumstances, entities are exempt from recognising deferred tax when they
recognise assets or liabilities for the first time. The amendments clarify that the exemption does not apply to transactions for which
entities recognise both an asset and a liability and that give rise to equal taxable and deductible temporary differences. This may
be the case for transactions such as leases and decommissioning, restoration and similar obligations. Entities are required to
recognise deferred tax on such transactions.
Group’s assessment performed to date
The amendments to AASB 112 are applicable for annual periods beginning on or after 1 July 2023, with earlier application
permitted. The amendments are not expected to have a material impact to the Group.
29. Subsequent events
The Directors resolved to pay a final dividend of 5 cents per share (franked to 1.5 cents), comprising of a regular dividend
of 5 cents per share to be paid on 20 September 2023 (Note 21).
Apart from the above, there has been no other matter or circumstance which has arisen since 30 June 2023 that has
significantly affected or may significantly affect:
(i)
the operations, in financial years subsequent to 30 June 2023, of the Group; or
(ii) the results of those operations; or
(iii) the state of affairs, in financial years subsequent to 30 June 2023, of the Group.
116
NOTES TO THE FINANCIAL STATEMENTS30 JUNE 2023 CONTINUEDHansen Technologies Ltd | Annual Report 2023 DIRECTORS’ DECLARATION
The Directors declare that the financial statements and notes set out on pages 60 to 116, in accordance with the
Corporations Act 2001:
• comply with Accounting Standards and the Corporations Regulations 2001, and other mandatory professional reporting
requirements;
• as stated in Note 1(a), the consolidated financial statements of the Group also comply with International Financial Reporting
Standards; and
• give a true and fair view of the financial position of the consolidated entity as at 30 June 2023 and of its performance
for the year ended on that date.
In the Directors’ opinion there are reasonable grounds to believe that Hansen Technologies Limited will be able to pay
its debts as and when they become due and payable.
At the date of this declaration, there are reasonable grounds to believe that the members of the extended closed group
identified in Note 27 will be able to meet any obligations or liabilities to which they are, or may become, subject by virtue
of the deed of cross guarantee described in Note 27.
This declaration has been made after receiving the declarations required to be made by the Managing Director and Chief
Financial Officer to the Directors in accordance with sections 295A of the Corporations Act 2001 for the financial year
ended 30 June 2023.
This declaration is made in accordance with a resolution of the Directors.
David Trude
Chair
Melbourne
23 August 2023
Andrew Hansen
Director
117
Hansen Technologies Ltd | Annual Report 2023
INDEPENDENT AUDITOR’S REPORT
RSM Australia Partners
Level 21, 55 Collins Street Melbourne VIC 3000
PO Box 248 Collins Street West VIC 8007
T +61 (0) 3 9286 8000
F +61 (0) 3 9286 8199
www.rsm.com.au
INDEPENDENT AUDITOR’S REPORT
To the Members of Hansen Technologies Limited
Opinion
We have audited the financial report of Hansen Technologies Limited (the Company) and its controlled entities
(the Group), which comprises the consolidated statement of financial position as at 30 June 2023, the
consolidated statement of comprehensive income, the consolidated statement of changes in equity and the
consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a
summary of significant accounting policies, and the directors' declaration.
In our opinion the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
(i) giving a true and fair view of the Group's financial position as at 30 June 2023 and of its financial
performance for the year then ended; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor's Responsibilities for the Audit of the Financial Report section of
our report. We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board's
APES 110 Code of Ethics for Professional Accountants (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.
THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the
RSM network is an independent accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
118
Hansen Technologies Ltd | Annual Report 2023
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial report of the current period. These matters were addressed in the context of our audit of the financial
report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key Audit Matter
How our audit addressed this matter
Recognition of Revenue
Refer to Note 3 in the financial statements
Revenue recognition was considered a key audit
matter, as it is complex and involves significant
management judgements.
The Group’s revenue is primarily derived from the
provision of billing solution services to customers,
maintenance and support, and licences. Revenue
determined for some of the service contracts is
based on stage of completion, calculated on the
proportion of total costs incurred at the reporting date
compared to management’s estimation of the total
costs of the contract.
Our audit procedures in relation to the recognition of
revenue included:
•
•
•
•
•
Assessing whether
revenue
recognition policies were in compliance with
Australian Accounting Standards;
the Group’s
and
Evaluating
operating
testing
effectiveness of management’s controls related
to revenue recognition;
the
Performing substantive analytical procedures
over key revenue streams;
revenue
transactions,
For a sample of
substantiating
to
supporting documentation, including contracts
with customers;
transactions by agreeing
For a sample of revenue transactions that were
recognised on a percentage of completion
basis, our testing included:
– Agreeing the contract price and variations
to customer contracts;
– Assessing management’s estimate of
costs to complete; and
– Assessing whether the project was within
budgeted margin.
• Reviewing sales transactions before and after
revenue was
year-end
to ensure
recognised in the correct period; and
that
• Reviewing large or unusual transactions during
the financial year.
119
Hansen Technologies Ltd | Annual Report 2023
INDEPENDENT AUDITOR’S REPORT CONTINUED
Impairment of Intangible Assets
Refer to Note 12 in the financial statements
The Group has net book value goodwill of $220
million in respect of acquisitions of subsidiaries as at
30 June 2023. We identified this area as a Key Audit
Matter due to the size of the goodwill balance, and
because the directors’ assessment of the ‘value in
use’ of the cash generating unit (“CGU”) involves
significant judgements about the future underlying
cash flows of the business, discount rates and
terminal growth applied.
For the year ended 30 June 2023 management have
performed an impairment assessment over the
goodwill balance by:
•
calculating the value in use for the CGU
using a discounted cash flow model. The
model used cash flows (revenues, expenses
and capital expenditure) for the CGU for 5
years, with a terminal growth rate applied to
the 5th year. The cash flows were then
discounted to net present value using the
Company’s weighted average cost of capital
(WACC); and
•
comparing the resulting value in use of the
CGU to its respective book value.
Management also performed a sensitivity analysis
over the value in use calculations, by varying the
WACC and other assumptions.
Our audit procedures in relation to management’s
impairment assessment involved the assistance of our
Corporate Finance team where required, and included:
•
Assessing management’s determination that
the goodwill should be allocated to a single
CGU based on the nature of the Group’s
business and the manner in which results are
monitored and reported;
•
Assessing the valuation methodology used;
• Challenging
the
reasonableness of key
assumptions,
flow
projections, exchange rates, discount rates,
and sensitivities used; and
including
cash
the
• Checking the mathematical accuracy of the
cash flow model, and reconciling input data to
supporting evidence, such as approved
budgets and considering the reasonableness of
these budgets.
Other Information
The directors are responsible for the other information. The other information comprises the information included
in the Group's annual report for the year ended 30 June 2023, but does not include the financial report and the
auditor's report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial report or our knowledge
obtained in the audit or otherwise appears to be materially misstated.
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.
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Hansen Technologies Ltd | Annual Report 2023
Responsibilities of the Directors for the Financial Report (continued)
In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic
alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and
Assurance Standards Board website at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf .
This description forms part of our auditor's report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the directors' report for the year ended 30 June 2023.
In our opinion, the Remuneration Report of Hansen Technologies Limited, for the year ended 30 June 2023,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
RSM AUSTRALIA PARTNERS
M PARAMESWARAN
Partner
Dated: 23 August 2023
Melbourne, Victoria
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Hansen Technologies Ltd | Annual Report 2023
ASX SHAREHOLDER INFORMATION
The shareholder information set out below was applicable as at 7 August 2023 disclosed pursuant to ASX official listing
requirements.
Distribution of shares
The following tables summarises the distribution of our listed shares as at 7 August 2023:
Range
100,001 and over
10,001 to 100,000
5,001 to 10,000
1,001 to 5,000
1 to 1,000
Total
Number of
holders
Number of
shares held
% of Issued
capital
60
157,854,000
1,149
1,107
2,925
2,357
7,598
27,996,136
8,122,853
7,797,765
986,519
202,757,273
100.00
77.85
13.81
4.00
3.85
0.49
The number of shareholders holding less than a marketable parcel of ordinary shares is 418 holding 5,845 shares (as at the closing
market price on 7 August 2023).
Twenty largest shareholders
The following table sets out the top 20 holders of our shares:
Range
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
OTHONNA PTY LTD
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
NATIONAL NOMINEES LIMITED
CITICORP NOMINEES PTY LIMITED
BNP PARIBAS NOMS PTY LTD
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
SANDHURST TRUSTEES LTD
CITICORP NOMINEES PTY LIMITED
MR CAMERON HUNTER
PACIFIC CUSTODIANS PTY LIMITED
PACIFIC CUSTODIANS PTY LIMITED
MR JAMES LUCAS & MS LESLEY DORMER
MR SCOTT WEIR
MRS LILIAN REICHENBERG
MR ANDREW HANSEN
LAYUTI PTY LTD
MR DAVID JOHN OSBORNE & MS LEONE CATHERINE OSBORNE
BROADGATE INVESTMENTS PTY LTD
NETWEALTH INVESTMENTS LIMITED
Total
Total other investors
Grand total
122
Number of
Shares Held
% of Issued
Capital
48,960,424
34,739,113
27,045,904
11,383,921
10,941,262
6,827,546
1,707,231
1,373,643
1,353,387
1,352,730
901,297
816,061
800,939
622,227
546,953
482,574
412,769
386,335
380,000
343,190
151,377,506
51,379,767
202,757,273
24.15
17.13
13.34
5.61
5.40
3.37
0.84
0.68
0.67
0.67
0.44
0.40
0.40
0.31
0.27
0.24
0.20
0.19
0.19
0.17
74.67
25.33
100.00
Hansen Technologies Ltd | Annual Report 2023 Substantial shareholdings
The following table shows holdings of substantial voting rights in the Company’s shares as notified to the Company under
the Corporations Act 2001 as at 31 July 2023:
Holder
Mr Andrew Hansen*
Mr David Osborne*
Mr Bruce Adams*
Number of
shares Held
% of Issued
capital
35,450,073
35,125,448
34,891,417
17.48%
17.32%
17.21%
* Each of these named persons has a joint interest in a single parcel of 34,739,113 shares as at the date of this report.
Voting rights
Refer to Note 20(c) of the financial statements.
Unquoted equity securities
Unquoted equity securities issued pursuant to the Hansen Technologies Limited Employee Performance Rights Plan
as at 15 August 2023:
Range
Performance rights
Number of
employees
participating
40
Number of
securities
734,781
123
Hansen Technologies Ltd | Annual Report 2023 CORPORATE DIRECTORY
Directors
David Trude, Chairman
Andrew Hansen, Managing Director
Bruce Adams, Non-Executive
Lisa Pendlebury, Non-Executive
Don Rankin, Non-Executive
David Osborne, Non-Executive
David Howell, Non-Executive
Company secretary
Julia Chand
Principal registered office
Level 2, 31 Queen Street
Melbourne, Victoria 3000
T (03) 9840 3000
F (03) 9840 3099
Share registry
Link Market Services Limited
Tower 4, 727 Collins Street
Melbourne, Victoria 3000
T 1300 554 474
F (02) 9287 0309 – Proxy forms
F (02) 9287 0303 – General
Stock exchange
The Company is listed on the Australian Stock Exchange
ASX code: HSN
Auditors
RSM Australia Partners
Level 21, 55 Collins Street
Melbourne, Victoria 3000
Solicitors
GrilloHiggins
Level 25, 367 Collins Street
Melbourne, Victoria 3000
Other information
Hansen Technologies Ltd ABN 90 090 996 455,
incorporated and domiciled in Australia,
is a publicly listed company limited by shares.
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Hansen Technologies Ltd | Annual Report 2023 Hansen Technologies Ltd | Annual Report 2023
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