Hudson Investment Group Limited
Annual Report 2024

Plain-text annual report

For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 2 Contents Page Corporate Directory 3 Chairman’s Report 4 Review of Operations 5 Directors’ Report 7 Remuneration Report - Audited 13 Auditor’s Independence Declaration 18 Corporate Governance Statement 19 Consolidated Statement of Profit or Loss and Other Comprehensive Income 32 Consolidated Statement of Financial Position 33 Consolidated Statement of Changes in Equity 34 Consolidated Statement of Cashflows 35 Notes to Financial Statements 36 Declaration by Directors 70 Independent Auditors’ Report 71 Shareholder Information 73 For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 3 CORPORATE DIRECTORY Hudson Investment Group Limited ACN 004 683 729 ABN 25 004 683 729 Registered and Corporate Office Level 5 52 Phillip Street Sydney NSW 2000 Australia Telephone: +61 2 9251 7177 Fax: +61 2 9251 7500 Email: corporate@higl.com.au Website: www.higl.com.au Board of Directors John W Farey (Non-Executive Chairman) Alan Beasley (Managing Director) Wei Huang (Executive Director) John J Foley Pin Chua Warren Wen-Shih Choo Joint Company Secretaries Henry Kinstlinger Mona Esapournoori Chief Financial Officer Francis Choy Risk & Compliance Allan Scadden Auditors K.S. Black & Co Level 1 251 Elizabeth Street Sydney NSW 2000 Telephone: +61 2 8839 3000 Share Registry Computershare Investor Services Pty Limited GPO Box 2975 Melbourne VIC 3001 Telephone: 1300 850 505 (within Australia) Lawyers Piper Alderman Level 23, Governor Macquarie Tower 1 Farrer Place Sydney NSW 2000 Telephone: +61 2 9253 9999 Bankers St George Bank Limited Level 14, 182 George St Sydney NSW 2000 Telephone: +61 2 9236 2230 Commonwealth Bank of Australia Corporate Financial Services Business & Private Banking Level 9, Darling Park 1 201 Sussex Street Sydney NSW 2000 Telephone: +61 2 9118 7031 ASX Code – HGL Hudson Investment Group Limited shares are listed on the Australian Securities Exchange. This financial report covers the Consolidated Entity consisting of Hudson Investment Group Limited and its controlled entities. Hudson Investment Group Limited is a company limited by shares, incorporated and domiciled in Australia. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 4 CHAIRMAN’S REPORT I present to you the Annual Report for Hudson Investment Group Limited ASX: HGL, (the Company) for the twelve months to 31 December 2024. The Company recorded a consolidated net loss after tax of $3.76 million for the year ending 31 December 2024. The Company has sold the property at 43 Regent Street Woolloongabba for $4.0 million on a delayed settlement basis by 30 June 2025. During the course of the year, the Company continued to concentrate on its current property portfolio. Through the Company’s wholly owned subsidiary Hudson Bowen Hills Pty Ltd exploring potential Residential Development Application (DA) to unlock more options for the Company. In addition, the approval of the strata subdivision of the Warnervale property has allowed for more flexibility for the Company to further develop and add value to its assets. Looking to the future, the focus of the Company is to continually develop its property portfolio to achieve its dual objectives of capital appreciation and to increase revenue to strengthen its strategic positioning for future growth. On behalf of the Board of Directors, I would like to thank the Company’s management team and staff for their contributions and dedication. Their loyal support together with the continuing involvement of shareholders of the Company is both highly valued and appreciated. John W Farey Non-Executive Chairman 28 March 2025 For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 5 REVIEW OF OPERATIONS ABOUT HUDSON INVESTMENT GROUP LTD Hudson Investment Group Ltd (HGL) is an ASX-listed Company focusing on industrial, residential and commercial property development, and currently owns the following properties: • Unit 2, 171-175 Sparks Road, Halloran, New South Wales • 59 Mountain Road, Halloran, New South Wales (both collectively the Warnervale Properties); • 47 Brookes Street, Bowen Hills, Queensland; and • 41-43 Brookes Street, Bowen Hills Queensland (both collectively the Bowen Hills Properties); and CORPORATE HIGHLIGHTS • HGL wholly owned subsidiary Hudson Regent Development Pty Ltd entered into a Contract of Sale for 43 Regent Street, Woolloongabba QLD with purchase price of $4 million. An initial amount has been received with the balance to be paid by end of June 2025. • HGL has increased lease income and a long-term tenant for Unit 2, 171-175 Sparks Road, Halloran New South Wales. • Exploring potential Residential Development Application (DA) for the Bowen Hills QLD properties in addition to the mix use DA, approved in 2021, to provide the Company with additional options with regard to the best use development of the property. WARNERVALE PROPERTY • Bunnings Frame and Truss business has leased the Warnervale site for over 20 years. Bunnings have a strong reputation in the construction industry and there are plans to expand operations. HGL has sufficient additional land to satisfy Bunnings growth ambitions Warnervale Property – industrial land For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 6 BOWEN HILLS PROPERTIES • The site is located in Brisbane CBD fringe suburb of Bowen Hills • In April 2021, DA for a 24-storey mixed use building was approved by the Minister for Economic Development Queensland (EDQ). HGL is currently exploring potential Residential DA in addition to the approved mix use DA to provide further opportunities and options for development. • Land size – 2,022m2 • Brookes Street frontage – 40.2 meters approximately • Exhibition Street – 40.2 meters approximately Conceptual Commercial Design COMPANY FOCUS HGL remains focused on assessing the highest and best use for its current property portfolio, to optimise cashflow, reduce costs, take advantage of opportunities to strengthen its strategic positioning for future growth and enhanced returns to shareholders. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 7 DIRECTORS’ REPORT Your Directors present their report together with the financial statements on the consolidated entity (referred to hereafter as the Group) consisting of Hudson Investment Group Limited (the Company) and the entities it controlled at the end of or during the year ended 31 December 2024. Principal activities The principal activities of the Group during the financial year were investment and development of properties in Australia. Operating results The consolidated net loss after tax for the financial year ended 31 December 2024 was $3.76 million compared to a net profit after tax of $0.18 million for the previous corresponding financial year. Total Shareholders’ Funds as at 31 December 2024 were $19.37 million (2023: $23.14 million) and the Net Asset Value per share is 32.6 cents (2023: 38.9 cents). Review of Operations Information on the operations of the Group and its business strategies and prospects is disclosed in both the Chairman’s Report and the Review of Operations contained on pages 5 to 6 of this Annual Report. Dividends The Directors of the Company do not recommend that any amount be paid by way of dividend (2023: nil). Meetings of Directors The number of Directors’ Meetings and Directors’ Committee Meetings held, and the number of these meetings attended by each of the directors of the Company during the financial year were: Directors Meetings Remuneration Committee Meetings Audit Committee Meetings Director Attended Held Whilst in Office Attended Held Whilst in Office Attended Held Whilst in Office J Farey 9 9 3 3 A Beasley 9 9 3 3 Wei Huang 9 9 3 3 J Foley 9 9 3 3 Dr Cheng Fong Han* 9 9 3 3 Pin Chua Warren Choo* 9 9 3 3 * Dr Han resigned as director on 24 March 2025 * Warren Choo appointed as director on 24 March 2025 For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 8 INFORMATION ON DIRECTORS AND MANAGEMENT DIRECTORS The following persons held office as Directors of the Company at any time during or since the end of the financial year: John W Farey Non-Executive Chairman Alan P Beasley Managing Director Wei Huang Executive Director John J Foley Non-Executive Director Dr Cheng Fong Han Non-Executive Director Resigned 24 March 2025 Pin Chua Non-Executive Director Warren Choo Non-Executive Director Appointed 24 March 2025 All Directors have been in office since the commencement of the financial year unless otherwise stated. John Farey, B. Com, FAIM, FAICD Non-Executive Chairman - appointed on 1 February 2002 Experience and Expertise John W Farey has over 45 years’ experience in financial services including merchant and investment banking. Other Current Directorships of Listed Companies Nil Former Directorships in the Last Three Years of Listed Companies Nil Special Responsibilities Chairman of the Board Member of the Audit Committee Interests in Shares and Options Direct interest in 1,000 shares Indirect interest in 6,887,980 shares Alan Beasley, B.Ec, CPA, FGIA, FAICD Managing Director - appointed on 19 January 2015 Experience and Expertise Mr Beasley is a Non-Executive Director and former Director of a number of publicly listed and unlisted companies. Mr Beasley was educated at the University of New England (BEc) and Stanford Graduate Business School, USA. Other Current Directorships of Listed Companies Epsilon Healthcare Limited (ASX: EPN) Former Directorships in the Last Three Years of Listed Companies Nil Special Responsibilities Managing Director Member of the Audit Committee Interests in Shares and Options Direct Interest – Nil Indirect Interest – 160,000 shares For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 9 Wei Huang, B.Ec, MComm Executive Director - appointed on 4 June 2019 Experience and Expertise Wei Huang graduated with Bachelor of Economics from Macquarie University and a Master of Commerce from the University of New South Wales. He is a member of CPA Australia and has experience in financial control, new business start-ups and development within the textile, retail, financial services, construction and mining sectors in Australia and internationally. Other Current Directorships of Listed Companies Nil Former Directorships in the Last Three Years of Listed Companies Nil Special Responsibilities Member of the Audit Committee Interests in Shares and Options Direct interest – Nil Indirect interest in 6,000,000 shares John Foley BD., LL.B., B.L. (Dub), KHS., F.A.I.C.D. Non-Executive Director - appointed on 6 August 2014 Experience and Expertise Mr Foley has wide-ranging experience in resources, industrial, manufacturing, legal, financial and investment related industries. His commercial and legal background provides knowledge and experience to the Company. Other Current Directorships of Listed Companies Citigold Corporation Limited Former Directorships in the Last Three Years of Listed Companies Nil Special Responsibilities Member of Audit Committee Chair of the Remuneration Committee Interests in Shares and Options Direct Interest – Nil Indirect Interest - Nil Dr Cheng Fong Han BSc. PhD. Non-Executive Director - appointed on 1 June 2017, resigned 24 March 2025 Experience and Expertise Dr Han is the current Executive Chairman of Hua Xia International Investments Ltd. He has previously held appointments as Group CEO and Managing Director of Fraser and Neave Limited and DBS Land Limited, Deputy Managing Director of Petrochemical Corporation of Singapore, and Chairman of Australand Holdings Ltd (1996-2000). Dr Han has also served as Permanent Secretary to the Ministry of Manpower (Singapore) (1978-1984). Other Current Directorships of Listed Companies Nil Former Directorships in the Last Three Years of Listed Companies Nil Special Responsibilities Member of the Audit Committee Interests in Shares and Options Direct Interest – Nil Indirect Interest - Nil For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 10 Mr Warren Wen-Shih Choo BSc. Non-Executive Director– appointed on 24 March 2025 Experience and Expertise Mr Choo currently serves as Director of Tridex Pte Ltd. Mr Choo has a background in engineering. Other Current Directorships of Listed Companies Nil Former Directorships in the Last Three Years of Listed Companies Nil Special Responsibilities Nil Interests in Shares and Options Direct Interest – Nil Indirect Interest - Nil Mr Pin Chua BBA Non-Executive Director - appointed on 27 September 2022 Experience and Expertise Mr. Chua previously held positions as senior manager in corporate, investment and enterprise banking in Singapore, Malaysia, and Indonesia and has the experience, expertise, and knowledge to contribute to the Company. Other Current Directorships of Listed Companies Nil Former Directorships in the Last Three Years of Listed Companies Nil Special Responsibilities Nil Interests in Shares and Options Direct Interest – Nil Indirect Interest - Nil MANAGEMENT Vincent Tan Director – Controlled entities Experience and Expertise Vincent Tan is a chartered accountant and has over the past 40 years worked in a range of industries, including insurance, securities trading, finance and property. Mr Tan has held senior management positions in a number of public and non-government organisations and has broad experience in corporate structuring. Henry Kinstlinger Joint Company Secretary – Appointed 16 March 2016 Experience and Expertise Henry Kinstlinger has, for the past thirty years, been actively involved in the financial and corporate management in several public companies and non-governmental organisations. He is currently the Company Secretary of ABX Group Limited. He is a corporate consultant with broad experience in investor and community relations and corporate and statutory compliance. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 11 Mona Esapournoori Joint Company Secretary – appointed 5 June 2018 Francis Choy MCom MBA FCPA (HK) FCPA CA Chief Financial Officer Experience and Expertise Francis Choy has held a number of senior positions in corporate financial management roles throughout Australia and South East Asia. He has extensive experience in project finance, compliance, acquisition and investment appraisals. He has been involved in project finance, financial management of property development and telecommunication projects in South East Asia. He held senior financial roles for numerous public listed companies both in Hong Kong and Australia. LIKELY DEVELOPMENTS Information on likely developments in the operations of the Group, known at the date of this report has been covered generally within the report. In the opinion of the Directors providing further information would prejudice the interests of the Group. RISK MANAGEMENT The Board is responsible for ensuring that risks, and also opportunities, are identified on a timely basis and that activities are aligned with the risks and opportunities identified by the Board. The Company believes that it is crucial for all Board members to be a part of this process, and as such the Board has not established a separate risk management committee. The Board has a number of mechanisms in place to ensure that management’s objectives and activities are aligned with the risks identified by the Board. These include the following: • Board approval of a strategic plan, which encompasses strategy statements designed to meet stakeholders’ needs and manage business risk. • Implementation of Board approved operating plans and budgets and Board monitoring of progress against these budgets. MATTERS SUBSEQUENT TO BALANCE DATE As at the date of lodgement of the 2024 Hudson Investment Group Limited Annual Report, the Directors note that on 31 March 2025, the Company’s auditor (KSB) issued a Disclaimer of Opinion (Disclaimer of Opinion) stating: “…we (KSB) were unable to obtain sufficient appropriate audit evidence regarding the recoverability of the receivable, existence (ownership of receivable) and the appropriateness of the going concern assumption used in the preparation of the financial report. These issues are material and persuasive to the financial report.” The Directors disagree with this Disclaimer of Opinion. Subsequent to the issue of the Disclaimer of Opinion, the directors have provided KSB with sufficient evidence showing: i) The Company has obtained a registered second mortgage over the land situated at 43 Regent Street Woolloongabba Qld ii) The Company has caused the financial report for the year ended 31 December 2024 to show a full provision over the recoverability of the remaining unpaid debt amounting to $2.395 million owed by the purchaser even though the directors believe that the debt will be paid in full by 30 June 2025 Experience and Expertise Mona Esapournoori holds a Bachelor of Law from Western Sydney University. She is admitted as a solicitor with the Law Society of New South Wales. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 12 iii) Provided an updated cash flow for the year ended 31 December 2025 showing a positive cash flow after eliminating the remaining recoverable debt of $2.395 million and iv) Provided additional documents stating that no Hudson director has any interest in the Woolloongabba land subject to the now registered second mortgage and the sales transaction was at arms length. KSB remains of the view expressed in the Disclaimer of Opinion. At the date of this report there are no other matters or circumstances that have arisen since 31 December 2024 that have significantly affected or may significantly affect: • The operations, in financial years subsequent to 31 December 2024 of the Group; • The results of those operations; or • The state of affairs, in financial years subsequent to 31 December 2024 of the Group. ENVIRONMENTAL REGULATIONS There has been no breach of environmental regulations during the financial year or in the period subsequent to the end of the financial year and up to the date of this report. The Company aims to ensure that the highest standard of environmental care is achieved, and that it complies with all relevant environmental legislation. The Directors are mindful of the regulatory regime in relation to the impact of the Company’s activities on the environment. To the best of the Directors’ knowledge, the Group has adequate systems in place to ensure compliance with the requirements of all environmental legislation described above and is not aware of any breach of those requirements during the financial year and up to the date of the Directors’ Report. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 13 REMUNERATION REPORT - AUDITED The information provided in this Remuneration Report has been audited as required by Section 308 (3c) of the Corporations Act 2001. This report outlines the remuneration arrangements in place for Directors and Executives of the Company. REMUNERATION COMMITTEE The Remuneration Committee reviews and approves policy for determining Executives’ remuneration and any amendments to that policy. The whole board sits as the Remuneration Committee which makes recommendations to the Board on the remuneration of Executive Directors (including base salary, incentive payments, equity awards and service contracts) and remuneration issues for Non-Executive Directors. The Committee meets as often as required but not less than once per year. The Committee met during the period and the Committee members attendance record is disclosed in the table of Directors Meetings shown on page 7. Options granted to directors and key management personnel do not have performance conditions. As such the Group does not have a policy for directors and key management personnel removing the “at risk” aspect of options granted to them as part of their remuneration. DIRECTORS’ AND OTHER KEY MANAGEMENT PERSONNEL REMUNERATION The following persons were Directors of the Company during the financial year unless otherwise stated: • John W Farey Non-Executive Chairman • Alan P Beasley Managing Director • Wei Huang Executive Director • John J Foley Non-Executive Director • Dr Cheng Fong Han Non-Executive Director Resigned 24 March 2025 • Warren Wen-Shih Choo Non-Executive Director Appointed 24 March 2025 • Pin Chua Non-Executive Director The following persons were other key management personnel of Hudson Investment Group Limited during the financial year: • Vincent Tan Director of controlled entities • Henry Kinstlinger Joint Company Secretary • Mona Esapournoori Joint Company Secretary • Francis Choy Chief Financial Officer Executives’ remuneration and other terms of employment are reviewed annually having regard to relevant comparative information and independent expert advice. As well as basic salary, remuneration packages include superannuation. Directors are also able to participate in an Employee Share Plan. Remuneration packages are set at levels that are intended to attract and retain executives capable of managing the Group’s operations. Consideration is also given to reasonableness, acceptability to shareholders and appropriateness for the current level of operations. Remuneration of Non-Executive Directors is determined by the Board based on recommendations from the Remuneration Committee and the maximum amount approved by shareholders from time to time. PERFORMANCE CONDITIONS The elements of remuneration as detailed within the Remuneration Report are dependent on the satisfaction of the individual’s performance and Hudson Investment Group’s financial performance. The Board undertakes an annual review of its performance and the performance of the Board Committees. Details of the nature and amount of each element of the remuneration of each Director of the Company and each specified executive of the Company are set out in the following tables. The remuneration amounts are the same for the Company and the Group. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 14 Directors and Other Key Management Personnel of Hudson Investment Group Limited Short Term Employee Benefits Post-Employment Benefits Long Term Benefits Salary and other fees Non-Monetary Benefits Superannuation Long Service Leave Total $ $ $ $ $ Consolidated 2024 Directors John W Farey 12,000 - - - 12,000 Alan P Beasley 150,000 - - - 150,000 Wei Huang * 150,000 - - - 150,000 John J Foley - - - - - Dr Cheng Fong Han - - - - - Pin Chua - - - - - Director - Total 312,000 - - - 312,000 KMP Henry Kinstlinger - - - - - Mona Esapournoori 12,000 - 1,350 200 13,550 Francis Choy 120,000 - 13,500 1,990 135,490 KMP - Total 132,000 - 14,850 2,190 149,040 2023 Directors John W Farey 12,000 - - - 12,000 Alan P Beasley 150,000 - - - 150,000 Wei Huang * 180,000 - - - 180,000 John J Foley - - - - - Dr Cheng Fong Han - - - - - Pin Chua - - - - - Director - Total 342,000 - - - 342,000 KMP Vincent Tan - - - - - Henry Kinstlinger - - - - - Mona Esapournoori 12,000 - 1,290 200 13,490 Francis Choy 120,000 - 12,900 1,984 134,884 KMP - Total 132,000 - 14,190 2,184 148,374 The amounts reported represent the total remuneration paid by entities in the Group in relation to managing the affairs of all the entities within the Group. The remuneration has not been allocated between the individual entities within the Group as this would not be practicable. *Mr Huang received director fee $150,000 p.a. (2023: $150,000 p.a.) and consultancy fee $Nil (2023: $30,000) via related entity. There are no performance conditions related to any of the above payments. There is no other element of Directors and other Key Management Personnel remuneration. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 15 EXECUTIVE SERVICE AGREEMENTS There is one service agreement in place formalising the terms of remuneration of Mr Beasley. The agreement has no specific term, remunerated in $150,000 p.a. and may be terminated by either party upon reasonable notice. The Company may terminate the agreement in the event of serious misconduct by either party without any compensatory payment. There is one service agreement in place formalising the terms of remuneration of Mr Huang. The agreement has no specific term, remunerated in $150,000 p.a. and may be terminated by either party upon reasonable notice. The Company may terminate the agreement in the event of serious misconduct by either party without any compensatory payment. There is one employment service agreement in place formalising the terms of remuneration of Mr Choy. The agreement has no specific term, remunerated in $120,000 p.a. plus on costs and may be terminated by either party upon reasonable notice. The Company may terminate the agreement in the event of serious misconduct by either party without any compensatory payment. There is one employment service agreement in place formalising the terms of remuneration of Ms Esapournoori. The agreement has no specific term, remunerated in $10,000 p.a. plus on costs and may be terminated by either party upon reasonable notice. The Company may terminate the agreement in the event of serious misconduct by either party without any compensatory payment. CORPORATE SERVICE AGREEMENTS The Company has entered into a Corporate Service Agreement with Hudson Asset Management Pty Limited pursuant to which Hudson Asset Management Pty Limited has agreed to provide its management, registered office, administrative, accounting, CFO and secretarial services. The term of the Corporate Services Agreement has no fixed expiry term and the fee payable is that amount agreed between the parties from time to time. The terms of the Corporate Services Agreement provide that Hudson Asset Management Pty Limited shall act in accordance with the directions of the Board. SHARE OPTIONS GRANTED TO DIRECTORS AND OTHER KEY MANAGEMENT PERSONNEL There were no options granted during or since the end of the financial year to any of the Directors or other Key Management Personnel of the Company and the Group as part of their remuneration. At the date of this report there were no unissued shares under option to Directors or other Key Management Personnel of the Company. End of Remuneration Report For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 16 DIRECTORS’ INTEREST The relevant interest of each Director in the share capital of the Company as shown in the Register of Directors’ Shareholdings as at the date of this report is: Directors’ Interest in shares and options of the Company and related bodies corporate Ordinary Shares (Number) Direct Interest Indirect Interest Employee Share Plan Options Director John Farey 1,000 6,887,980 - - Alan Beasley - 160,000 - - Wei Huang - 6,000,000 - - John J Foley - - - - Dr Cheng Fong Han - - - - Pin Chua - - - - Please refer to Note 23 of the financial statements for details. SHARES UNDER OPTION No options over issued shares or interests in the Company were granted during or since the end of the financial year and there were no options outstanding at the date of this report. LOANS TO DIRECTORS AND OTHER KEY MANAGEMENT PERSONNEL No loans were made to Directors or specified Executives of the Company and the Group under the Employee Share Plan during the financial year. Please refer to Note 23 for details. DIRECTORS’ AND OFFICERS’ INDEMNITIES AND INSURANCE During the financial year the Company paid an insurance premium, insuring the Company’s Directors, (as named in this report), Company Secretary, Executive officers and employees against liabilities not prohibited from insurance by the Corporations Act 2001. A confidentiality clause in the insurance contract prohibits disclosure of the amount of the premium and the nature of insured liabilities. PROCEEDINGS ON BEHALF OF THE COMPANY Other than the matter referred to in the Directors’ Report no person has applied to the Court under Section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the Company, or to intervene in any proceedings to which the Company is a party for the purposes of taking responsibility on behalf of the Company for all or part of those proceedings. No proceedings have been brought or intervened in or on behalf of the Company with leave of the Court under Section 237 of the Corporations Act 2001. ROUNDING OF AMOUNTS The Company is of a kind referred to in Class Order 98/0100, issued by the Australian Securities & Investments Commission, relating to the “rounding off” of amounts in the Directors’ Report. Amounts in the Directors’ Report have been rounded off in accordance with that Class Order to the nearest thousand dollars, or in certain cases, to the nearest dollar. AUDITOR’S INDEPENDENCE DECLARATION The Auditor’s Independence Declaration as required under Section 307C of the Corporations Act 2001 has been received and is set out on page 17. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 17 NON-AUDIT SERVICES The Company may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor’s expertise and experience with the Group are important. Details of the amounts paid or payable to the auditor K.S. Black & Co for audit and non-audit services provided during the year are set out below. The Board of Directors has considered the position and, in accordance with advice received from the audit committee, is satisfied that the provision of the non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the provision of non-audit services by the auditor, as set out below, did not compromise the auditor’s independence requirements of the Corporations Act 2001 for the following reasons: • all non-audit services have been reviewed by the audit committee to ensure they do not impact the impartiality and objectivity of the auditor. • none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants. AUDITOR’S REMUNERATION During the year the following fees were paid or payable for services provided by the Auditor of the parent entity, its related practices and non-related audit firms: Consolidated 2024 2023 $ $ Audit services: Amounts paid or payable to auditors for audit and review of the financial report for the parent entity or any entity in the Group Review services fee 10,995 10,450 Audit service fee 18,345 17,450 Taxation and other advisory services: Amounts paid or payable to the Auditors for non-audit services for the parent entity or any entity in the Group Taxation services 3,595 3,395 Advisory services - - Total 32,935 31,295 AUDITOR K.S. Black & Co continues in office in accordance with Section 327 of the Corporations Act 2001. This Directors’ Report, incorporating the Remuneration Report, is signed in accordance with a Resolution of the Board of Directors. Alan Beasley Wei Huang Managing Director Executive Director Signed at Sydney 28 March 2025 For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 18 AUDITOR’S INDEPENDENCE DECLARATION For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 19 CORPORATE GOVERNANCE STATEMENT Corporate Governance Plan The Company has adopted this Corporate Governance Plan, which forms the basis of a comprehensive system of control and accountability for the administration of corporate governance. The Board is committed to administering the policies and procedures with openness and integrity, pursuing the true spirit of corporate governance commensurate with the Company’s needs. To the extent they are applicable to the Company, the Board has adopted the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations 4th Edition (“Principles and Recommendations”). In light of the Company’s size and nature, the Board considers that the current board is a cost effective and practical method of directing and managing the Company. As the Company’s activities develop in size and scope, the size of the board and the implementation of additional corporate governance policies and structures will be reviewed. a) Board Responsibilities The Board is responsible for corporate governance of the Company. The Board develops strategies for the Company, reviews strategic objectives and monitors performance against those objectives. The goals of the corporate governance processes are to: 1. maintain and increase Shareholder value; 2. ensure a prudential and ethical basis for the Company's conduct and activities; 3. ensure compliance with the Company's legal and regulatory objectives consistent with these goals, and to achieve this the Board assumes the following responsibilities: 4. developing initiatives for profit and asset growth; i. reviewing the corporate, commercial and financial performance of the Company on a regular basis; ii. acting on behalf of, and being accountable to, the Shareholders; and iii. identifying business risks and implementing actions to manage those risks and corporate systems to assure quality. The Company is committed to the circulating of relevant materials to Directors in a timely manner to facilitate Directors' participation in the Board discussions on a fully-informed basis. b) Composition of the Board Election of Board members is substantially the province of the Shareholders in general meeting. However, subject thereto, the Company is committed to the following principles: 1. the Board is to comprise persons with a blend of skills, experience and attributes appropriate for the Company and its businesses; and 2. the principal criteria for the appointment of new Directors are their ability to add value to the Company and its business. All incumbent Directors bring an independent judgement to bear in deliberations and the current representation is considered adequate given the stage of the Company's development. The names, qualifications and relevant experience of each Director will be set out in the Annual Reports of the Company. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 20 c) Code of Conduct As part of its commitment to recognising the legitimate expectations of stakeholders and promoting practices necessary to maintain confidence in the Company's integrity, the Company has an established Code of Conduct (the Code) to guide compliance with legal, ethical and other obligations to legitimate stakeholders and the responsibility and accountability required of the Company's personnel for reporting and investigating unethical practices or circumstances where there are breaches of the Code. These stakeholders include employees, clients, customers, government authorities, creditors and the community as a whole. This Code governs all of the Company's commercial operations and the conduct of Directors, employees, consultants, contractors an all other people when they represent the Company. This Code also governs the responsibility and accountability required of the Company's personnel for reporting and investigating unethical practices. The Board, management and all employees of the Company are committed to implementing this Code and each individual is accountable for such compliance. A copy of the Code is given to all employees, contractors and relevant personnel, including directors. d) Diversity Policy The Board has adopted a diversity policy which provides a framework for the Company to achieve, among other things, a diverse and skilled workforce, a workplace culture characterised by inclusive practices and behaviours for the benefit of all staff, improved employment and career development opportunities for women and a work environment that values and utilises the contributions of employees with diverse backgrounds, experiences and perspectives. e) Continuous Disclosure The Board has adopted a diversity policy which provides a framework for the Company to achieve, among other things, a diverse and skilled workforce, a workplace culture characterised by inclusive practices and behaviours for the benefit of all staff, improved employment and career development opportunities for women and a work environment that values and utilises the contributions of employees with diverse backgrounds, experiences and perspectives. f) Whistle-blower policy HGL is committed to the highest standards of conduct and ethical behaviour in all of our business activities, and to promoting and supporting a culture of honest and ethical behaviour, corporate compliance and good corporate governance. HGL encourages the reporting of any instances of suspected unethical, illegal, fraudulent or undesirable conduct involving HGL's businesses, and will ensure that those persons who make a report shall do so without fear of intimidation, disadvantage or reprisal. g) Anti-bribery and corruption policy HGL has zero tolerance for bribery and corruption and are committed to identifying and preventing bribery and corruption. Any breach will be treated seriously and may result in disciplinary action, dismissal or termination of contract. h) Audit Committee and Management of Risk The Board has established an Audit and Risk Committee comprised of the full board. The Company is not of a size that justifies having a separate committee to oversee risk, so matters typically considered by such a committee are dealt with by the full Board. The Board has established an Audit and Risk Committee Charter governing the Audit and Risk Committee which is available on the Company's website (under "Corporate Governance"). For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 21 i) Remuneration Arrangements The Board will decide the remuneration of an executive Director, without the affected executive Director participating in that decision-making process. The constitution of the Company provides that Directors are entitled to remuneration as the Directors determine, but the remuneration of the non-executive Directors must not exceed, in aggregate, a maximum amount fixed by the Company in general meeting of Shareholders for that purpose. This amount has been set at $200,000. A Director may be paid fees or other amounts (subject to any necessary Shareholder approval) (for example, non-cash performance incentives such as Options) as determined by the Board where a Director performs special duties or otherwise performs services outside the scope of the ordinary duties of a Director. Directors are also entitled to be paid reasonable travelling, hotel and other expenses incurred by them respectively in or about the performance of their duties as Directors. The Board reviews and approves the remuneration policy to enable the Company to attract and retain executives and Directors who will create value for Shareholders having consideration to the amount considered to be commensurate for a company of its size and level of activity as well as the relevant Directors' time, commitment and responsibility. The Board is also responsible for reviewing any employee incentive and equity-based plans including the appropriateness of performance hurdles and total payments proposed. j) Shareholder Communications The Board strives to ensure that Shareholders are provided with sufficient information to assess the performance of the Company and its Directors and to make well-informed investment decisions. Information is communicated to Shareholders through: 1. annual and half-yearly financial reports and quarterly reports; 2. annual and other general meetings convened for Shareholder review and approval of Board proposals; 3. continuous disclosure of material changes to ASX for open access to the public; and 4. the Company maintains a website where all ASX announcements, notices and financial reports are published as soon as possible after release to ASX. The auditor is invited to attend the annual general meeting of Shareholders. The Chairman will permit Shareholders to ask questions about the conduct of the audit and the preparation and content of the audit report. k) Trading in HGL Shares The Company's Share Trading Policy prohibits Directors from taking advantage of their position or information acquired, in the course of their duties, and the misuse of information for personal gain or to cause detriment to the Company. Directors, senior executives and employees are required to advise the Company Secretary of their intentions prior to undertaking any transaction in the Company's securities. If an employee, officer or director is considered to possess material non-public information, they will be precluded from making a security transaction until after the time of public release of that information. A copy of the Company's Share Trading Policy is available on the Company's website (under “Corporate Governance”). For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 22 l) Corporate Social Responsibility The Company is committed to conducting its operations and activities in harmony with the environment and society, and wherever practicable to work in collaboration with communities and government institutions in decision-making and activities for effective, efficient and sustainable solutions. A copy of the Company's Environmental and Social Charter is available on the Company's website (under "Corporate Governance"). m) Departures from Recommendations The Company is required to report any departures from the recommendations in its annual financial report. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 23 ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations PRINCIPLE Response PRINCIPLE 1 – LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT 1.1 A listed entity should have and disclose a board charter setting out: (a) the respective roles and responsibilities of its board and management; and (b) those matters expressly reserved to the board and those delegated to management. Complies. The Company’s Corporate Governance Plan includes a Board Charter, which discloses the specific responsibilities of the Board. The responsibilities delegated to the senior management team are set out in the Board Charter. The Board Charter can be viewed at the Company’s website www.higl.com.au 1.2 A listed entity should: (a) undertake appropriate checks before appointing a director or senior executive or putting someone forward for election as a director; and (b) provide security holders with all material information in its possession relevant to a decision on whether or not to elect or re-elect a director. Complies. The Company has conducted appropriate checks for all current Directors. The Company will undertake appropriate checks described in Guidance Note 1, paragraph 3.15 issued by the ASX before appointing a person, or putting forward to Shareholders a candidate for election, as a director. 1.3 A listed entity should have a written agreement with each director and senior executive setting out the terms of their appointment. Complies. Not all Directors have written agreement setting out the terms of their appointment. The Company will endeavour to finalise these agreements shortly. 1.4 The company secretary of a listed entity should be accountable directly to the board, through the chair, on all matters to do with the proper functioning of the board. Complies. The Company Secretary has been appointed and is accountable directly to the Board, through the Chairperson, on all matters to do with the proper functioning of the Board. 1.5 A listed entity should: (a) have and disclose a diversity policy; (b) through its board or a committee of the board set measurable objectives for achieving gender diversity in the composition of its board, senior executives and workforce generally; and (c) disclose in relation to each reporting period: (1) the measurable objectives set for that period to achieve gender diversity; (2) the entity’s progress towards achieving those objectives; and Complies. The Diversity Policy is disclosed on the Company’s website. Details of the Company’s measurable objectives for achieving gender diversity and its progress towards achieving them and the entity’s gender diversity figures are set out in the Company’s annual report. The Company has gender-diversity at various levels of management. However, the Company has not reported diversity metrics in the FY24 Annual Report. The Company will consider providing this disclosure in future Annual Reports. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 24 (3) either: (A) the respective proportions of men and women on the board, in senior executive positions and across the whole workforce (including how the entity has defined “senior executive” for these purposes); or (B) if the entity is a “relevant employer” under the Workplace Gender Equality Act, the entity’s most recent “Gender Equality Indicators”, as defined in and published under that Act. If the entity was in the S&P / ASX 300 Index at the commencement of the reporting period, the measurable objective for achieving gender diversity in the composition of its board should be to have not less than 30% of its directors of each gender within a specified period. 1.6 A listed entity should: (a) have and disclose a process for periodically evaluating the performance of the board, its committees and individual directors; and (b) disclose for each reporting period whether a performance evaluation has been undertaken in accordance with that process during or in respect of that period. Will comply. The Company will disclose the process for evaluating the performance of the Board, its committees and individual directors in its future annual reports. Details of the performance evaluations undertaken will be set out in future annual reports. 1.7 A listed entity should: (a) have and disclose a process for evaluating the performance of its senior executives at least once every reporting period; and (b) disclose for each reporting period whether a performance evaluation has been undertaken in accordance with that process during or in respect of that period. Complies. Senior executive key performance indicators are set annually, with performance appraised by the Board, and reviewed in detail by the Board. The internal review is to be conducted on an annual basis and if deemed necessary an independent third party will facilitate this internal review. Details of the performance evaluations undertaken will be set out in future annual reports. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 25 PRINCIPLE 2 - STRUCTURE THE BOARD TO BE EFFECTIVE AND ADD VALUE 2.1 The board of a listed entity should: (a) have a nomination committee which: (1) has at least three members, a majority of whom are independent directors; and (2) is chaired by an independent director, and disclose: (3) the charter of the committee; (4) the members of the committee; and (5) as at the end of each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or (b) if it does not have a nomination committee, disclose that fact and the processes it employs to address board succession issues and to ensure that the board has the appropriate balance of skills, knowledge, experience, independence and diversity to enable it to discharge its duties and responsibilities effectively. Does not comply. The Company does not have a nomination committee. Currently the role of the nomination committee is undertaken by the full Board. The Company intends to establish a nomination committee once the Company’s operations are of sufficient magnitude. The Company does not have a nomination committee. The Board evaluates the skills, experience of its members and then determines whether additional members should be invited to the Board to complement or replace the existing members. 2.2 A listed entity should have and disclose a board skills matrix setting out the mix of skills that the board currently has or is looking to achieve in its membership. Does not yet comply. The Company intends to develop a board skill matrix setting out the mix of skills and diversity the Board has and requires. The skill matrix will be available at the Company’s website once finalised. 2.3 A listed entity should disclose: (a) the names of the directors considered by the board to be independent directors; (b) if a director has an interest, position, affiliation or relationship of the type described in Box 2.3 but the board is of the opinion that it does not compromise the independence of the director, the nature of the interest, position or relationship in question and an explanation of why the board is of that opinion; and (c) the length of service of each director. Complies The Company’s independent directors are Mr John Farey, Mr John Foley, Warren Choo and Mr Pin Chua. The independence of the directors and length of service of each director are set out in the Company’s annual report. Details of any relevant interest, position, association or relationship impacting upon a director’s independence are set out in the Company’s annual report. 2.4 A majority of the board of a listed entity should be independent directors. Complies. The Company has six directors. Four of these directors are non- executive directors. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 26 2.5 The chair of the board of a listed entity should be an independent director and, in particular, should not be the same person as the CEO of the entity. Complies. The chair is an independent director and is a different person to the CEO of the entity. 2.6 A listed entity should have a program for inducting new directors and for periodically reviewing whether there is a need for existing directors to undertake professional development to maintain the skills and knowledge needed to perform their role as directors effectively. Does not yet comply. Currently the induction of new directors and plan for professional development is managed informally by the full Board. The Company intends to develop a formal program for inducting new directors and providing appropriate professional development opportunities consistent with the development of the Company. PRINCIPLE 3 – INSTIL A CULTURE OF ACTING LAWFULLY, ETHICALLY AND RESPONSIBLY 3.1 A listed entity should articulate and disclose its values. Complies. The Board has a Code of Conduct to guide compliance with legal, ethical and other obligations to legitimate stakeholders and the responsibility and accountability required of the Group’s personnel for reporting and investigating unethical practices or circumstances where there are beaches of the Code. The Code of Conduct is available on the Company’s website. 3.2 A listed entity should: (a) have and disclose a code of conduct for its directors, senior executives and employees; and (b) ensure that the board or a committee of the board is informed of any material breaches of that code by a director or senior executive; and (c) any other material breaches of that code that call into question the culture of the organisation. Complies. The Company’s Corporate Governance Plan includes a Code of Conduct, which discloses the specific responsibility and accountability of ABx directors, senior executives and employees. The Code of Conduct can be viewed at the Company’s website www.higl.com.au 3.3 A listed entity should: (a) have and disclose a whistleblower policy; and (b) ensure that the board or a committee of the board is informed of any material incidents reported under that policy. Complies. The Company’s Corporate Governance Plan includes a whistleblower policy, which encourages promoting and supporting a culture of honest and ethical behaviour, corporate compliance and good corporate governance. The whistleblower policy can be viewed at the Company’s website www.higl.com.au For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 27 3.4 A listed entity should: (a) have and disclose an anti-bribery and corruption policy; and (b) ensure that the board or committee of the board is informed of any material breaches of that policy. Complies. The Company’s Corporate Governance Plan includes an anti- bribery and corruption policy, which outlines the Company’s commitment to comply with the laws and regulations and acting in an ethical manner, consistent with the principles of honesty, integrity, fairness and respect. The anti-bribery and corruption policy can be viewed at the Company’s website www.higl.com.au PRINCIPLE 4 – SAFEGUARD THE INTEGRITY OF CORPORATE REPORTS 4.1 The board of a listed entity should: (a) have an audit committee which: (1) has at least three members, all of whom are non-executive directors and a majority of whom are independent directors; and (2) is chaired by an independent director, who is not the chair of the board, and disclose: (3) the charter of the committee; (4) the relevant qualifications and experience of the members of the committee; and (5) in relation to each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or (b) if it does not have an audit committee, disclose that fact and the processes it employs that independently verify and safeguard the integrity of its corporate reporting, including the processes for the appointment and removal of the external auditor and the rotation of the audit engagement partner. Partially complies. The board has established an audit and risk committee Charter. Members of the committee comprise the whole board of directors. A summary of the charter and details of the number of times the audit and risk committee met throughout the period and the individual attendances of the members at those meetings are set out in the Company’s annual report. 4.2 The board of a listed entity should, before it approves the entity’s financial statements for a financial period, receive from its CEO and CFO a declaration that, in their opinion, the financial records of the entity have been properly maintained and that the financial statements comply with the appropriate accounting standards and give a true and fair view of the financial position and performance of the entity and that the opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively. Complies. The Board requires the Chief Executive Officer and the Chief Financial Officer to provide such a statement before approving the entity’s financial statements for a financial period. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 28 4.3 A listed entity should disclose its process to verify the integrity of any periodic corporate report it releases to the market that is not audited or reviewed by an external auditor. Complies. The Company goes through external auditor approval for its corporate reports. External auditor attends AGMs and is available to answer questions from Security Holders relevant to the audit. PRINCIPLE 5 – MAKE TIMELY AND BALANCED DISCLOSURE 5.1 A listed entity should have and disclose a written policy for complying with its continuous disclosure obligations under listing rule 3.1. Complies. The Company has a written policy on information disclosure. The focus of these policies and procedures is continuous disclosure and improving access to information for investors. The Company’s continuous disclosure policy can be viewed at the Company’s website. 5.2 A listed entity should ensure that its board receives copies of all material market announcements promptly after they have been made. Complies. 5.3 A listed entity that gives a new and substantive investor or analyst presentation should release a copy of the presentation materials on the ASX Market Announcements Platform ahead of the presentation. Complies. PRINCIPLE 6 – RESPECT THE RIGHTS OF SECURITY HOLDERS 6.1 A listed entity should provide information about itself and its governance to investors via its website. Complies. The Company has provided specific information about itself and its key personnel and has developed a comprehensive Corporate Governance Plan. Details can be found at the Company’s website. 6.2 A listed entity should have an investor relations program that facilitates effective two-way communication with investors. Complies. The Company has established a Shareholder’s Communication Policy. The Company recognises the importance of forthright communications and aims to ensure that the shareholders are informed of all major developments affecting the Company. Details of the Shareholder’s Communication Policy can be found on the Company’s website. 6.3 A listed entity should disclose how it facilitates and encourages participation at meetings of security holders. Complies. The Shareholder’s Communication Policy is available on the Company’s website and details are set out in the Company’s annual report. 6.4 A listed entity should ensure that all substantive resolutions at a meeting of security holders are decided by a poll rather than by a show of hands. Complies. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 29 6.5 A listed entity should give security holders the option to receive communications from, and send communications to, the entity and its security registry electronically. Complies. The Company has provided the option to receive communications from, and send communications to, the entity and its security registry electronically. PRINCIPLE 7 – RECOGNISE AND MANAGE RISK 7.1 The board of a listed entity should: (a) have a committee or committees to oversee risk, each of which: (1) has at least three members, a majority of whom are independent directors; and (2) is chaired by an independent director, and disclose: (3) the charter of the committee; (4) the members of the committee; and (5) as at the end of each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or (b) if it does not have a risk committee or committees that satisfy (a) above, disclose that fact and the processes it employs for overseeing the entity’s risk management framework. Complies. The Board has established an audit and risk committee to oversee risk which is comprised of the whole Board. Details of the number of times the committee met and the individual attendances of the members at those meetings is set out in the Company’s annual report. 7.2 The board or a committee of the board should: (a) review the entity’s risk management framework at least annually to satisfy itself that it continues to be sound and that the entity is operating with due regard to the risk appetite set by the board; and (b) disclose, in relation to each reporting period, whether such a review has taken place. Complies. The Company’s Corporate Governance Plan includes a Risk Management Review Procedure and Compliance and Control policy. The Board determines the Company’s “risk profile” and is responsible for overseeing and approving risk management strategy and policies, internal compliance and internal control. The Board has delegated to the audit and risk committee the responsibility for implementing the risk management system. Details of the number of times the committee conducted a risk management review in relation to each reporting period will be disclosed in its annual reports. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 30 7.3 A listed entity should disclose: (a) if it has an internal audit function, how the function is structured and what role it performs; or (b) if it does not have an internal audit function, that fact and the processes it employs for evaluating and continually improving the effectiveness of its governance, risk management and internal control processes. Does not yet comply. The Board has delegated the internal audit function to the audit and risk committee and intends to establish and implement the structure and role of the internal audit function. The Company will disclose the details of the internal audit function in its future annual reports. 7.4 A listed entity should disclose whether it has any material exposure to environmental or social risks and, if it does, how it manages or intends to manage those risks. Complies. The Company has an Audit and Risk committee appointed to manage economic sustainability and risk. In addition to this the Company also has an Environmental and Social Charter on its website, and manages environmental and social sustainability risks accordingly. PRINCIPLE 8 – REMUNERATE FAIRLY AND RESPONSIBLY 8.1 The board of a listed entity should: (a) have a remuneration committee which: (1) has at least three members, a majority of whom are independent directors; and (2) is chaired by an independent director, and disclose: (3) the charter of the committee; (4) the members of the committee; and (5) as at the end of each reporting period, the number of times the committee met throughout the period and the individual attendances of the members at those meetings; or (b) if it does not have a remuneration committee, disclose that fact and the processes it employs for setting the level and composition of remuneration for directors and senior executives and ensuring that such remuneration is appropriate and not excessive. Does not yet comply due to the size of the Company. The Board has adopted a Remuneration Committee Charter. However, the Company is not of a size that justifies having a separate Remuneration Committee so matters typically considered by such a committee are dealt with by the full Board. The Board has reviewed, through independent sources, the level and composition of remuneration for Directors and senior executives to ensure that such remuneration is appropriate and not excessive. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 31 8.2 A listed entity should separately disclose its policies and practices regarding the remuneration of non-executive directors and the remuneration of executive directors and other senior executives. Complies. The Company distinguishes the structure of Non- executive Directors’ remuneration from Executive Directors and senior executives. Details of the policies and practices regarding remuneration are set out in the Company’s annual report. The Remuneration Committee Charter is disclosed on the Company’s website. 8.3 A listed entity which has an equity-based remuneration scheme should: (a) have a policy on whether participants are permitted to enter into transactions (whether through the use of derivatives or otherwise) which limit the economic risk of participating in the scheme; and (b) disclose that policy or a summary of it. Complies. The Company’s Policy on Dealing with Company Securities prohibits executive staff from undertaking hedging or other strategies that could limit the economic risk associated with Company Securities issued under any equity based remuneration scheme. The Company’s Share Trading Policy can be viewed on the Company’s website. PRINCIPLE 9 – ADDITIONAL RECOMMENDATIONS THAT APPLY ONLY IN CERTAIN CASES 9.1 A listed entity with a director who does not speak the language in which board or security holder meetings are held or key corporate documents are written should disclose the processes it has in place to ensure the director understands and can contribute to the discussions at those meetings and understands and can discharge their obligations in relation to those documents. We do not have a director in this position and therefore this recommendation is not applicable. 9.2 A listed entity established outside Australia should ensure that meetings of security holders are held at a reasonable place and time. We do not have a director in this position and therefore this recommendation is not applicable. 9.3 A listed entity established outside Australia, and an externally managed listed entity that has an AGM, should ensure that its external auditor attends its AGM and is available to answer questions from security holders relevant to the audit. We do not have a director in this position and therefore this recommendation is not applicable. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 32 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2024 Consolidated 2024 2023 Notes $’000 $’000 Revenue 4 1,498 1,480 Cost of services (492) (487) Other income and expenses 5 (3,066) 910 Cost of providing services and administration expenses 6 (896) (914) Finance income 6 87 7 Finance expenses 6 (899) (814) PROFIT / (LOSS) BEFORE INCOME TAX (3,768) 182 Income tax 7 - - PROFIT / (LOSS) AFTER TAX (3,768) 182 OTHER COMPREHENSIVE INCOME Other comprehensive income - - Tax expenses - - Other comprehensive income after tax - - Total comprehensive income (3,768) 182 Profit attributable to non-controlling interests - - TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO MEMBERS OF THE PARENT ENTITY (3,768) 182 Earnings per shares Cents Cents Basic earnings per share (cents) 16 (6.35) 0.31 Diluted earnings per share (cents) 16 (6.35) 0.31 The above Statement should be read in conjunction with the accompanying notes. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 33 CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2024 Consolidated 2024 2023 Notes $’000 $’000 ASSETS CURRENT ASSETS Cash and cash equivalents 8 616 599 Trade and other receivables 9 (129) (129) Other current assets 10 137 290 TOTAL CURRENT ASSETS 624 760 NON-CURRENT ASSETS Investment properties 11 31,314 35,821 TOTAL NON-CURRENT ASSETS 31,314 35,821 TOTAL ASSETS 31,938 36,581 LIABILITIES CURRENT LIABILITIES Trade and other payables 12 267 223 Accrued payable and provision 68 66 Financial liabilities 13 4,200 4,200 TOTAL CURRENT LIABILITIES 4,535 4,489 NON-CURRENT LIABILITIES Accrued payable and provision 31 27 Financial liabilities 13 8,000 8,925 TOTAL NON-CURRENT LIABILITIES 8,031 8,952 TOTAL LIABILITIES 12,566 13,441 NET ASSETS 19,372 23,140 EQUITY Issued Capital 14 63,397 63,397 Reserves 15 5,261 5,261 Accumulated losses 15 (49,286) (45,518) Total equity attributable to equity holders of the parent entity 19,372 23,140 Non-controlling interest - - TOTAL EQUITY 19,372 23,140 The above Statement should be read in conjunction with the accompanying notes. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 34 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2024 Consolidated Notes Issued Capital Reserves Accumulated Losses Total Equity $’000 $’000 $’000 $’000 Balance at 1 January 2024 14 63,397 5,261 (45,518) 23,140 Share issued - - - - Share issuing costs - - - - Profit / (loss) for the year - - (3,768) (3,768) Balance at 31 December 2024 14 63,397 5,261 (49,286) 19,372 Balance at 1 January 2023 63,397 5,261 (45,700) 22,958 Share issued - - - - Share issuing costs - - - - Profit / (loss) for the year - - 182 182 Balance at 31 December 2023 14 63,397 5,261 (45,518) 23,140 The above Statement should be read in conjunction with the accompanying notes. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 35 CONSOLIDATED STATEMENT OF CASHFLOWS FOR THE YEAR ENDED 31 DECEMBER 2024 Consolidated Notes 2024 2023 $’000 $’000 Cash flows from operating activities Receipts from customers 1,505 1,504 Payments to suppliers, employees and service providers (1,305) (1,271) Interest received 87 7 Interest paid (840) (686) Net cash (used in) / provided by operating activities 18 (553) (446) Cash flows from investing activities Proceed from sale of properties 4,000 - Payments for investment properties improvements (109) (831) (Advance) to other entities – vendor finance (2,396) - Net cash provided by / (used in) investing activities 1,495 (831) Cash flows from financing activities Proceeds from issuing share - - Share issuing cost - - Bank borrowings (925) 1,764 Net cash (used in) / provided by financing activities (925) 1,764 Net increase / (decrease) in cash and cash equivalents 17 487 Cash and cash equivalents at the beginning of the year 599 112 Cash and cash equivalents at the end of the year 8 616 599 The above Statement should be read in conjunction with the accompanying notes. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 36 NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2024 1. CORPORATE INFORMATION The consolidated financial statements and notes of the Company for the year ended 31 December 2024 were authorised for issue in accordance with a resolution of the directors and covers Hudson Investment Group Limited (the Company) as the parent entity as well as the group consisting of Hudson Investment Group Limited and its subsidiaries as required by the Corporations Act 2001 (the Group). The consolidated financial statements and notes are presented in Australian currency. Hudson Investment Group Limited is a company limited by shares incorporated in Australia whose shares are publicly traded on the Australian Securities Exchange. 2. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES a. Basis of preparation This general-purpose financial report has been prepared in accordance with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accountancy Standards Board and the Corporations Act 2001. Statement of Compliance Australian Accounting Standards ('AASBs') include Australian equivalents to International Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the financial report of Hudson Investment Group Limited also complies with International Financial Reporting Standards. Critical accounting estimates and judgements Details of critical accounting estimates and assumptions about the future made by management at reporting date are set out below: – Impairment of assets The Company assesses impairment at each reporting date by evaluating conditions specific to the Group that may lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. Calculations performed in assessing recoverable amounts incorporate a number of key estimates. ─ Fair value of Investment Property (Note 11) Critical judgements Management have made the following judgements when applying the Group's accounting policies: – Recognition of deferred tax assets In line with the Group’s accounting policy (Note 2f) and as disclosed in Note 7, deferred tax assets have not been recognised. Going Concern This financial report has been prepared on a going concern basis, which contemplates the continuity of business activities and the realisation of assets and payments of liabilities in the normal course of business. The directors believe the Company will be able to pay its debts as and when they fall due and to fund near term anticipated activities. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 37 2. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued Recognition of deferred tax assets In line with the Group’s accounting policy (Note 2f) and as disclosed in Note 7, deferred tax assets have not been recognised. Historical cost convention These financial statements have been prepared on an accruals basis and are based on the historical cost convention except for where noted in these accounting policies. Material accounting policies adopted in the preparation of these financial statements are presented below and have been consistently applied unless otherwise stated. ASIC Class Order 98/100 The Company is of a kind referred to in ASIC Class Order 98/100, issued by the Australian Securities and Investments Commission, relating to the 'rounding off' of amounts in the financial report. Amounts in the financial report have been rounded off in accordance with that Class Order to the nearest thousand dollars, or in certain cases, the nearest dollar. b. Principles of consolidation Subsidiaries The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Hudson Investment Group Limited (“the parent entity”) as at the reporting date and the results of all subsidiaries for the year then ended. Hudson Investment Group Limited and its subsidiaries together are referred to in this financial report as the Group. Subsidiaries are all those entities over which the Group has the power to govern the financial and operating policies so as to obtain benefits from the entity’s activities, generally accompanying a shareholding of more than one-half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. The financial performance of those entities is included only for the period of the year that they were controlled. The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group. Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. Minority interests in the results and equity of subsidiaries are shown separately in the consolidated Statement of Profit or Loss and Other Comprehensive Income and Statement of Financial Position respectively. Investments in subsidiaries are accounted for at cost in the individual financial statements of Hudson Investment Group Limited. c. Segment reporting A business segment is a group of assets and operations engaged in providing products or services that are subject to risks and returns that are different to those of other business segments. A geographical segment is engaged in providing products or services within a particular economic environment and is subject to risks and returns that are different from those of segments operating in other economic environments. Reporting to management by segments is on this basis. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 38 2. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued d. Foreign currency transactions and balances (i) Functional and presentation currency Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’). The financial statements are presented in Australian dollars, which is Hudson Investment Group Limited’s functional and presentation currency. (ii) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Profit or Loss and Other Comprehensive Income. (iii) Group companies The results and financial position of all the Group entities that have a functional currency different from the presentation currency are translated into the presentation currency as follows: • assets and liabilities for each Statement of Financial Position presented are translated at the closing rate at the date of that Statement of Financial Position; • income and expenses for each Statement of Profit or Loss and Other Comprehensive Income are translated at average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); • retained earnings are translated at the exchange rates prevailing at the date of transactions; and • all resulting exchange differences are recognised as a separate component of equity. On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings and other currency instruments designated as hedges of such investments, are taken to shareholders’ equity. When a foreign operation is sold, or borrowings repaid a proportionate share of such exchange differences are recognised in the Statement of Profit or Loss and Other Comprehensive Income as part of the gain or loss on the sale where applicable. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 39 2. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued e. Revenue recognition Revenue is recognised at the fair value of consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances and duties and taxes paid. The following specific recognition criteria must also be met before revenue is recognised: Sale of Goods Revenue from sale of goods is recognised when the significant risks and rewards of ownership have passed to the buyer and can be reliably measured. Risks and rewards are considered passed to buyer when goods have been delivered to the customer. Interest Interest revenue is recognised as it accrues taking into account the effective yield on the financial asset. Rental Income Rental income on investment properties is accounted for on a straight-line basis over the lease term. Contingent rentals are recognised as income in the periods when they are earned. All revenue is stated net of the amount of goods and services tax (GST). f. Income tax The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements, and to unused tax losses. Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply when the assets are recovered or liabilities are settled, based on those tax rates which are enacted or substantively enacted. The relevant tax rates are applied to the cumulative amounts of deductible and taxable temporary differences to measure the deferred tax asset or liability. An exception is made for certain temporary differences arising from the initial recognition of an asset or a liability. No deferred tax asset or liability is recognised in relation to these 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. Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of investments in controlled entities where the parent entity is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future. Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity. The Company and its wholly owned entities are part of a tax-consolidated group under Australian taxation law. Hudson Investment Group Limited is the head entity in the tax-consolidated group. Tax expense/income, deferred tax liabilities and deferred tax assets arising from temporary differences of the members of the tax-consolidated group are recognised in the separate financial statements of the members of the tax-consolidated group using the ‘separate taxpayer within group’ approach. Current tax liabilities and assets and deferred tax assets arising from unused tax losses and tax credits of the members of the tax-consolidated group are recognised by the Company (as head entity in the tax-consolidated group). The amounts receivable/payable under tax funding arrangements are due upon notification by the entity which is issued soon after the end of each financial year. Interim funding notices may also be issued by the head entity to its wholly owned subsidiaries. These amounts are recognised as current inter-company receivables or payables. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 40 2. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued g. Goods and services tax (GST) Revenues, expenses and assets are recognised net of the amount of GST except: • where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and • receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the Statement of Financial Position. Cash flows are included in Statement of Cash Flows on a gross basis except for the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority, are classified as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority. h. Cash and cash equivalents For the purposes of the Statement of Cash Flows, cash includes cash and cash equivalents on hand and at call deposits with banks or financial institutions, investment in money market instruments maturing within less than 3 months, net of bank overdrafts. i. Trade and other receivables Trade receivables are recognised initially at fair value and subsequently measured at amortised cost, less provision for doubtful debts. Trade receivables are due for settlement no more than 60 days from the date of recognition. Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off. A provision for doubtful receivables is established when there is objective evidence that entities in the Group will not be able to collect all amounts due according to the original terms of receivables. j. Impairment of assets Assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units). Non-financial assets that suffered impairment are reviewed for possible reversal of the impairment at each reporting period. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 41 2. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued k. Financial instruments Recognition and initial measurement Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provisions to the instrument. For financial assets, this is equivalent to the date that the company commits itself to either the purchase or sale of the asset (i.e. trade date accounting is adopted). Financial instruments are initially measured at fair value plus transaction costs, except where the instrument is classified ‘at fair value through profit or loss’, in which case transaction costs are expensed to profit or loss immediately. Classification and subsequent measurement Finance instruments are subsequently measured at either of fair value, amortised cost using the effective interest rate method, or cost. Fair value represents the amount for which an asset could be exchanged or a liability settled, between knowledgeable, willing parties. Where available, quoted prices in an active market are used to determine fair value. In other circumstances, valuation techniques are adopted. Amortised cost is calculated as: (a) the amount at which the financial asset or financial liability is measured at initial recognition; (b) less principal repayments; (c) plus or minus the cumulative amortisation of the difference, if any, between the amount initially recognised and the maturity amount calculated using the effective interest method; and (d) less any reduction for impairment. The effective interest method is used to allocate interest income or interest expense over the relevant period and is equivalent to the rate that exactly discounts estimated future cash payments or receipts (including fees, transaction costs and other premiums or discounts) through the expected life (or when this cannot be reliably predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or financial liability. Revisions to expected future net cash flows will necessitate an adjustment to the carrying value with a consequential recognition of an income or expense in profit or loss. The Group does not designate any interests in subsidiaries, associates or joint venture entities as being subject to the requirements of accounting standards specifically applicable to financial instruments. (i) Financial assets at fair value through profit or loss Financial assets are classified at ‘fair value through profit or loss’ when they are either held for trading for the purpose of short-term profit taking, derivatives not held for hedging purposes, or when they are designated as such to avoid an accounting mismatch or to enable performance evaluation where a group of financial assets is managed by key management personnel on a fair value basis in accordance with a documented risk management or investment strategy. Such assets are subsequently measured at fair value with changes in carrying value being included in profit or loss. (ii) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortised cost. Loans and receivables are included in current assets, except for those which are not expected to mature within 12 months after reporting date. (All other loans and receivables are classified as non-current assets.) For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 42 2. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued (iii) Held-to-maturity investments Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or determinable payments, and it is the Group’s intention to hold these investments to maturity. They are subsequently measured at amortised cost. Held-to-maturity investments are included in non-current assets, except for those which are expected to mature within 12 months after reporting date. (All other investments are classified as current assets.) If during the period the Group sold or reclassified more than an insignificant amount of the held-to-maturity investments before maturity, the entire held-to-maturity investments category would be tainted and reclassified as available-for-sale. (iv) Available-for-sale financial assets Available-for-sale financial assets are non-derivative financial assets that are either not suitable to be classified into other categories of financial assets due to their nature, or they are designated as such by management. They comprise investments in the equity of other entities where there is neither a fixed maturity nor fixed or determinable payments. Available-for-sale financial assets are included in non-current assets, except for those which are expected to be disposed of within 12 months after reporting date. (All other financial assets are classified as current assets.) (v) Financial Liabilities Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost. Fair value Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to determine the fair value for all unlisted securities, including recent arm’s length transactions, reference to similar instruments and option pricing models. Impairment At the end of each reporting period, the Group assesses whether there is objective evidence that a financial instrument has been impaired. In the case of available-for-sale financial instruments, a prolonged decline in the value of the instrument is considered to determine whether impairment has arisen. Impairment losses are recognised in the statement of comprehensive income. De-recognition Financial assets are derecognised where the contractual rights to receipt of cash flows expires or the asset is transferred to another party whereby the entity no longer has any significant continuing involvement in the risks and benefits associated with the asset. Financial liabilities are derecognised where the related obligations are discharged, cancelled or expired. The difference between the carrying value of the financial liability extinguished or transferred to another party and the fair value of consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognised in profit or loss. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 43 2. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued l. Fair value estimation The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes. The fair value of financial instruments traded in active markets is based on quoted market prices at the Statement of Financial Position date. The quoted market price used for financial assets held by entities in the Group is the current bid price; the appropriate quoted market price for financial liabilities is the current ask price. The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. Entities in the Group use a variety of methods and make assumptions that are based on market conditions existing at each balance date. Quoted market prices or dealer quotes for similar instruments are used for long-term debt instruments held. Other techniques, such as estimated discounted cash flows, are used to determine fair value for the remaining financial instruments. The nominal value less estimated credit adjustments of trade receivables and payables are assumed to approximate their fair values. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to entities in the Group for similar financial instruments. m. Property, plant and equipment Land and buildings are shown at fair value, based on periodic valuations by external independent valuers, less subsequent depreciation for buildings. Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset and the net amount is restated to the re-valued amount of the asset. All other plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the Statement of Comprehensive Income during the financial period in which they are incurred. Increases in the carrying amounts arising on revaluation of land and buildings are credited to the asset revaluation reserve in equity. A revaluation surplus is credited to the asset revaluation reserve included within shareholder’s equity unless it reverses a revaluation decrease on the same asset previously recognised in the Statement of Profit or Loss and Other Comprehensive Income. A revaluation deficit is recognised in the Statement of Profit or Loss and Other Comprehensive Income unless it directly offsets a previous revaluation surplus on the same asset in the asset revaluation reserve. On disposal, any revaluation reserve relating to sold assets is transferred to retained earnings. Independent valuations are performed regularly to ensure the carrying amounts of land and buildings do not differ materially from the fair value at the Statement of Financial Position date. Land is not depreciated. Depreciation on other assets is calculated using the straight line, over their estimated useful lives, as follows: • Plant and equipment 10 years (depreciation rate 10%) • Buildings 20 years (depreciation rate 5%) The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each Statement of Financial Position date. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount (note 2 (m)). Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the Statement of Profit or Loss and Other Comprehensive Income. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 44 2. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued n. Investment property Investment property is held for long-term rental yields and is not occupied by the Group. Investment property is carried at fair value, which is based on active market prices, adjusted, if necessary, for any difference in the nature, location or condition of the specific asset. If this information is not available, the Group uses alternative valuation methods such as recent prices in less active markets or discounted cash flow projections. These valuations are reviewed annually. Changes in fair values are recorded in the Statement of Profit or Loss and Other Comprehensive Income as part of other income. o. Trade and other payables 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 usually paid within 30 days of recognition. p. Provisions Provisions are recognised when the group 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 the outflow can be reliably measured. Provisions are measured using the best estimate of the amounts required to settle the obligation at the end of the reporting period. q. r. s. Other liabilities Other liabilities comprise non-current amounts due to related parties that do not bear interest and are repayable within one year of Statement of Financial Position date. Employee benefits Wages, Salaries and Annual Leave Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled within one year of Statement of Financial Position date are recognised in other liabilities in respect of employees' services rendered up to Statement of Financial Position date and are measured at amounts expected to be paid when the liabilities are settled. Long Service Leave The liability for long service leave is recognised in the provision for employee benefits and measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date. In determining the liability, consideration is given to employee wage increases and the probability that the employee may satisfy resting requirements. Those cash flows are discounted using market yields on national government bonds with terms to maturity that match the expected timing of cash flows. Issued capital Ordinary shares are classified as equity. Costs directly attributable to the issue of new shares or options are shown as a deduction from the equity proceeds, net of any income tax benefit. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 45 2. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES continued t. Share-based payments Ownership-based remuneration is provided to employees via an employee share option plan and employee share plan. Share-based compensation is recognised as an expense in respect of the services received, measured on a fair value basis. The fair value of the options at grant date is independently determined using a Black Scholes option pricing model that takes into account the exercise price, the term of the option, the vesting and performance criteria, the impact of dilution, the non-tradeable nature of the option, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk-free interest rate for the term of the option. The fair value of the options granted excludes the impact of any non-market vesting conditions (for example, profitability and sales growth targets). Non-market vesting conditions are included in assumptions about the number of options that are expected to become exercisable. At each Statement of Financial Position date, the Group revises its estimate of the number of options that are expected to become exercisable. The employee benefit expense recognised each period takes into account the most recent estimate. Upon the exercise of options, the balance of the share-based payments reserve relating to those options is transferred to share capital. u. Earnings per share (EPS) Basic EPS is calculated as net profit attributable to members, adjusted to exclude costs of servicing equity (other than dividends), divided by the weighted average number of ordinary shares, adjusted for any bonus element. Diluted EPS is calculated as net profit attributable to members, adjusted for costs of servicing equity (other than dividends), the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised as expenses; and other non-discretionary changes in revenues or expenses during the period that would result from the dilution of potential ordinary shares; divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus element. v. New Accounting Standards for Application The AASB has issued new and amended accounting standards and interpretations that have mandatory application dates for future reporting periods. The group has decided against early adoption of these standards. We have reviewed these standards and interpretations and there are none having any material effect. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 46 3. FINANCIAL RISK MANAGEMENT a. General objectives, policies and processes In common with all other businesses, the Group is exposed to risks that arise from its use of financial instruments. This note describes the Group’s objectives, policies and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements. There have been no substantive changes in the Group’s exposure to financial instrument risks, its objectives, policies and processes for managing those risks or the methods used to measure them from previous periods unless otherwise stated in this note. The Board has overall responsibility for the determination of the Group’s risk management objectives and policies and, whilst retaining ultimate responsibility for them, it has delegated the authority for designing and operating processes that ensure the effective implementation of the objectives and policies to the Group’s finance function. The Groups' risk management policies and objectives are therefore designed to minimise the potential impacts of these risks on the results of the Group where such impacts may be material. The Board receives reports from the Chief Financial Officer through which it reviews the effectiveness of the processes put in place and the appropriateness of the objectives and policies it sets. The Group’s finance function also reviews the risk management policies and processes and report their findings to the Audit Committee. The overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the Group’s competitiveness and flexibility. Further details regarding these policies are set out below. The Group and the parent entity hold the following financial instruments: Consolidated 2024 2023 $’000 $’000 Financial assets Current Cash and cash equivalents 616 599 Trade and other receivables (129) (129) 487 470 Financial liabilities Current Trade and other payables 267 223 Financial liabilities 4,200 4,200 Non-current Financial liabilities 8,000 8,925 12,467 13,348 For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 47 3. FINANCIAL RISK MANAGEMENT continued b. Credit risk Credit risk is the risk that the other party to a financial instrument will fail to discharge their obligation resulting in the Group incurring a financial loss. This usually occurs when debtors or counterparties to derivative contracts fail to settle their obligations owing to the Group excluding the available for sale financial assets. The maximum exposure to credit risk at balance date is the carrying amount of the financial assets, excluding the available for sale financial assets, as summarised under note(a) above. For banks and financial institutions, only independently rated parties are accepted and each deposit account is kept to under $0.25 million to ensure that it is covered by the Governments bank deposit guarantee scheme. The maximum exposure to credit risk at balance date by country is as follows: Consolidated 2024 2023 $’000 $’000 Australia 2,496 100 2,496 100 c. Liquidity risk Liquidity risk is the risk that the Group may encounter difficulties raising funds to meet commitments associated with financial instruments that is, borrowing repayments. Bank loans are detailed below. The funds were provided by bankers for the Group and the Parent Company. It is the policy of the Board of Directors that treasury reviews and maintains adequate committed credit facilities and the ability to close-out market positions. Maturity Analysis of financial assets Carrying Amount Contractual Cash flows < 6 mths 6- 12 mths 1-3 years > 3 years Consolidated 2024 $'000 $'000 $'000 $'000 $'000 $'000 Current Cash and cash equivalent 616 616 616 - - - Trade and other receivables (129) 2,266 2,266 - - - Total financial assets 487 2,882 2,882 - - - 2023 Current Cash and cash equivalent 599 599 599 - - - Trade and other receivables (129) (129) (129) - - - Total financial assets 470 470 470 - - - For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 48 3. FINANCIAL RISK MANAGEMENT continued Maturity Analysis of financial liabilities Carrying Amount Contractual Cash flows < 6 mths 6- 12 mths 1-3 years > 3 years Consolidated 2024 $'000 $'000 $'000 $'000 $'000 $'000 Current Trade and other payables 267 267 267 - - - Financial liabilities 4,200 4,200 - 4,200 - - Non-current Financial Liabilities 8,000 8,000 - - 8,000 - Total financial liabilities at amortised cost 12,467 12,467 267 4,200 8,000 - 2023 Current Trade and other payables 223 223 223 - - - Financial liabilities 4,200 4,200 - 4,200 - - Non-current Financial Liabilities 8,925 8,925 - - 8,925 - Total financial liabilities at amortised cost 13,348 13,348 223 4,200 8,925 - For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 49 3. FINANCIAL RISK MANAGEMENT continued d. Market risk Market risk arises from the use of interest bearing, tradable and foreign currency financial instruments. It is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in interest rates (interest rate risk), foreign exchange rates (currency risk) or other market factors (other price risk). (i) Interest rate risk The Group does not apply hedge accounting. The Group is constantly monitoring its exposure to trends and fluctuations in interest rates in order to manage interest rate risk. For further details of exposure to interest rate risk refer Note 13 Financial Liabilities. Sensitivity Analysis The following tables demonstrate the sensitivity to reasonably possible changes in interest rates, with all other variables held constant, of the Group’s profit after tax (through the impact on floating rate borrowings). There is no impact on the Group’s equity. +1% -1% Carrying Amount Interest Rate Interest Rate Consolidated 2024 $'000 $'000 $'000 Financial Liabilities 12,200 (122) 122 Tax charge of 25% 31 (31) After tax increase/(decrease) 12,200 (91) 91 2023 Financial Liabilities 13,125 (131) 131 Tax charge of 25% 33 (33) After tax increase/(decrease) 13,125 (98) 98 (ii) Currency risk The Group’s policy is, where possible, to allow group entities to settle liabilities denominated in their functional currency (AUD) with the cash generated from their own operations in that currency. Where group entities have liabilities denominated in a currency other than their functional currency (and have insufficient reserves of that currency to settle them) cash already denominated in that currency will, where possible, be transferred from elsewhere within the Group. In order to monitor the continuing effectiveness of this policy, the Group receives forecast, analysed by the major currencies held by the Group, of liabilities due for settlement and expected cash reserve. There is no foreign currency loan as at reporting date (2023: Nil). For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 50 3. FINANCIAL RISK MANAGEMENT continued Capital risk management In managing its capital, the Group’s primary objectives are to pay dividends and maintain liquidity. These objectives dictate any adjustments to capital structure. Rather than set policies, advice is taken from professional advisors as to how to achieve these objectives. There has been no change in either of these objectives, or what is considered capital in the year. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. Consistently with others in the industry, the Group and the parent entity monitor capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including 'Financial liabilities' and 'trade and other payables' as shown in the Statement of Financial Position) less cash and cash equivalents. Total capital is calculated as 'equity' as shown in the Statement of Financial Position (including minority interest) plus net debt. It is the Group’s policy to maintain its gearing ratio at a healthy and manageable level. The Group’s gearing ratio at the Statement of Financial Position date is as follows: Gearing ratios Consolidated 2024 2023 $'000 $'000 Total borrowings 12,200 13,125 Less: cash and cash equivalents (616) (599) Net borrowings 11,584 12,526 Total equity 19,372 23,140 Total capital – equity and borrowings 30,956 35,666 Gearing Ratio 37% 35% There have been no other significant changes to the Group’s capital management objectives, policies and processes in the year nor has there been any change in what the Group considers to be its capital. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 51 4. REVENUE Consolidated 2024 2023 $’000 $’000 Rental Income 1,491 1,470 Service Fee Income 7 10 1,498 1,480 5. OTHER INCOME AND EXPENSES Consolidated 2024 2023 $’000 $’000 Change in fair value of investment properties (916) 774 Gain on disposal of investment property 235 - Provision for doubtful debt – vendor finance (2,395) - Others 10 - Insurance compensation - 136 (3,066) 910 6. EXPENSES a. b. c. The profit/(loss) before income tax is arrived after (charging)/crediting the following specific amounts: Cost of providing services and administration expenses Consolidated 2024 2023 $’000 $’000 Consulting and professional expenses (43) (121) Director and Employee on costs (575) (511) Legal expenses (13) (12) Other administration expenses (265) (270) (896) (914) Finance income Interest received 87 7 Finance expenses Interest paid – bank loan (895) (789) Others (4) (25) (899) (814) For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 52 7. INCOME TAX a. Income tax expense Consolidated 2024 2023 $’000 $’000 Income tax expense Current tax expense - - Deferred tax expense - - Total income tax expense/(benefit) - - Deferred tax expense Increase in deferred tax expense/(benefit) - - b. Numerical reconciliation of income tax to prima facie tax payable Profit / (loss) from continuing operations before income tax (3,768) 182 Income tax expense (benefit) calculated @ 25% (2023:25%) (943) 46 Deferred tax expenses relating to partly owned subsidiaries outside of the tax consolidated group Temporary differences not brought to account 579 (226) Recoupment of prior year tax losses not previously brought to account - - Tax losses not brought to account 364 180 Income tax expense/(benefit) at effective tax rate of 25% (2023: 25%) - - c. Amounts recognised directly in equity Aggregate current and deferred tax arising during the reporting period and not recognised in profit and loss but directly debited or credited to equity: Current income tax Current income tax on transaction costs of issuing equity instruments - - d. Unrecognised deferred tax assets and liabilities Consolidated 2024 2023 $’000 $’000 The unrecognised deferred tax assets of the Group include $6,264,515 (2023: $4,809,515) in relation to carried forward tax losses and $5,180,341 (2023: $5,540,341) in relation to carried forward capital losses. Deferred tax assets and liabilities have not been recognised in the statement of financial position for the following items: Other deductible temporary differences/permanent differences and tax losses 2,315 (904) 2,315 (904) Potential benefit/(expense) at 25% (2023: 25%) 579 (226) For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 53 7. INCOME TAX continued e. Deferred tax assets Deferred tax assets comprise temporary differences attributable to: Amounts recognised in profit and loss Tax losses - - Amounts recognised directly in equity Share issue expenses - - - - f. Deferred tax liabilities Deferred tax liabilities comprise temporary differences attributable to: Amounts recognised directly in equity Revaluations of land and buildings - - Amounts recognised in profit and loss Capitalised development costs - - - - 8. CASH & CASH EQUIVALENTS Consolidated 2024 2023 $’000 $’000 Cash at bank and on hand 616 599 Cash held in trust accounts - - 616 599 Weighted average interest rates 0.02% 0.04% For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 54 9. TRADE AND OTHER RECEIVABLES Consolidated 2024 2023 $’000 $’000 Current Trade receivables (note a) (110) (113) Provision for doubtful debts - - (110) (113) Deposit 100 100 Provision (100) (100) Other receivable – vendor finance (note b) 2,396 - Provision for doubtful debt (2,395) - Other receivables (note b) (20) (16) (129) (129) a. Trade receivables past due but not impaired Consolidated 2024 2023 $’000 $’000 Up to 3 months - (113) 3 to 6 months - - - (113) b. Other receivables Company disposed its Regent street property in 2024 on deferred settlement basis. The remaining interest bearing secured vendor financed receivable $2.39 million will be due for settlement in June 2025. Company has registered second mortgage on the sold property as security. These amounts relate to receivables for GST and deposit paid. c. Advances to controlled entities There are no advances to controlled entities that are past due but not impaired as measurement is tied to recoverability. The advances are non-interest bearing and with no securities. d. Fair value and credit risk Current trade and other receivables Due to the short-term nature of these receivables their carrying amount is assumed to approximate their fair value. The maximum exposure to credit risk at the reporting date is the carrying amount of each class of receivables mentioned above 10. OTHER CURRENT ASSETS Consolidated 2024 2023 $’000 $’000 Prepayment 137 290 Others - - 137 290 For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 55 11. INVESTMENT PROPERTIES Consolidated 2024 2023 $'000 $'000 Non-current Investment properties at fair value 31,314 35,821 31,314 35,821 a. Valuation basis The basis of the valuation of investment properties is fair value being the amounts for which the properties could be exchanged between willing parties in an arm’s length transaction, based on current prices in an active market for similar properties in the same location and condition and subject to similar leases. The revaluations were based on a combination of independent assessments made by a member of the Australian Property Institute and directors’ valuations. Consolidated 2024 2023 $'000 $'000 Investment properties at fair value Independent valuation 38,725 43,950 Acquisition cost - 3,225 Capital works improvements and capitalised costs 104 3,244 Accumulated depreciation and fair value provision (7,515) (14,598) 31,314 35,821 b. Reconciliation A reconciliation of the carrying amount of investment properties at the beginning and end of the current financial year is set out below: Consolidated 2024 2023 $'000 $'000 At fair value Balance at beginning of year 35,821 34,474 Disposal of property (4,000) - Capital Works and improvements 104 573 Change in fair value (611) 774 Carrying amount at end of the year 31,314 35,821 c. Amounts recognised in Statement of Profit or Loss and Other Comprehensive Income for investment properties Consolidated 2024 2023 $'000 $'000 Rental and services income 1,491 1,470 Property running expenses 492 487 d. Non-current assets pledged as security Refer to Note 13 for information on non-current assets pledged as security by the parent entity or its controlled entities. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 56 11. INVESTMENT PROPERTIES continued e. Details of Hudson Investment Group Limited investment property portfolio Note 1 : The industrial property located at Halloran has a current bank valuation of $20.5 million. A registered mortgage is secured over the property and the loan value is $8.0 million. Note 2 : A bank valuation of $9.1 million exists. A registered mortgage is secured over the property and the loan is $4.2million. Note 3 : The property was sold in July 2024 for $4.0 million on a delayed settlement basis by 30 June 2025. The Group investment portfolio carrying value of $31.3 million in book represents auditor’s assessed portfolio fair value amount despite external independent valuation of $38.7 million. 12. TRADE AND OTHER PAYABLES Consolidated 2024 2023 Current $'000 $'000 Unsecured Trade and other creditors 202 149 Other payables – rental bonds 65 74 267 223 For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 57 13. FINANCIAL LIABILITIES Consolidated 2024 2023 $’000 $’000 Current Secured Bank loan 4,200 4,200 Total Current 4,200 4,200 Non-Current Secured Bank loan 8,000 8,925 Total Non-Current 8,000 8,925 Security for borrowings Bank loans are secured by first mortgages over the Group’s land and properties and fixed charges Over assets of the Group. The loans are repayable in 2025 to 2026. The variable interest rate is at 6.46% (2023: 6.83%). The facilities are subject to an annual review and compliance of financial covenants. Assets pledged as security The carrying amounts of non-current assets pledged as security are: Consolidated 2024 2023 $’000 $’000 Land and Investment Properties 31,314 35,821 31,314 35,821 The fair value of borrowings is equivalent to the carrying amounts of loans liabilities. Risk exposure Information about the Group’s exposure to interest rate changes is provided in Note 3. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 58 14. ISSUED CAPITAL Consolidated and Parent Entity Consolidated and Parent Entity 2024 2023 2024 2023 Shares Shares Number Number $’000 $’000 Share capital Ordinary shares 59,359,935 59,359,935 63,397 63,397 a. Movement during the year Balance at beginning of the year 59,359,935 59,359,935 63,397 63,397 Share issued - - - - Share issuing cost - - - - Balance at the end of the year 59,359,935 59,359,935 63,397 63,397 b. Terms and conditions Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the parent entity in proportion to the number of and amounts paid on the shares held. On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and upon a poll each share is entitled to one vote. c. Options There are no unissued ordinary shares of the Company under option at the date of this report. d. Performance Options No options were granted and issued during this year. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 59 15. RESERVES AND ACCUMULATED LOSSES a. Reserves Consolidated 2024 2023 $’000 $’000 Asset revaluation reserve 1,141 1,141 Capital reserve 5,386 5,386 Foreign currency translation reserve (1,266) (1,266) 5,261 5,261 Movements in reserves Asset revaluation reserve Balance at start of period 1,141 1,141 Business combination movement - - Balance at the end of period 1,141 1,141 Capital Profits Reserve Balance at start of period 5,751 5,751 Business combination movement (365) (365) Balance at the end of period 5,386 5,386 Foreign currency translation reserve Balance at start of period (1,266) (1,266) Currency translation differences - - Balance at the end of period (1,266) (1,266) The asset revaluation reserve records increments and decrements on the revaluation of individual parcels of land and buildings. The balance standing to the credit of the reserve may be used to satisfy the distribution of bonus shares to shareholders and is only available for the payment of cash dividends in limited circumstances as permitted by law, net of capital gains tax payable. The foreign currency translation reserve is used to record exchange differences on translation of foreign controlled subsidiaries. The reserve is recognised in the Statement of Profit or Loss and Other Comprehensive Income when the investment is disposed of. b. Accumulated losses Consolidated 2024 2023 $’000 $’000 Balance at the beginning of the year (45,518) (45,700) Profit / (loss) for the year (3,768) 182 Balance at the end of the year (49,286) (45,518) For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 60 16. EARNINGS / (LOSS) PER SHARE 2024 2023 Cents Cents Basic earnings per share (6.35) 0.31 Diluted earnings per share (6.35) 0.31 2024 2023 $’000 $’000 Profit used in calculating basic and diluted earnings/(loss) per share (3,768) 182 2024 Shares 2023 Shares Weighted average number of ordinary shares used as the denominator in calculating basic earnings per share 59,359,935 59,359,935 Adjustments for calculation of diluted earnings per share - - Weighted average number of ordinary shares used as the denominator in calculating diluted earnings per share. 59,359,935 59,359,935 17. OPERATING SEGMENTS The Consolidated Entity’s primary reporting format is business segments and its secondary reporting format is geographical segments. Business segments The Consolidated entity is organised into the following divisions by product and service type. Property investment & development Development and administration of industrial property in eastern Australia. Geographical segments All business segments operate principally within Australia. Accounting policies Segment revenues and expenses are those directly attributable to the segments and include any joint revenue and expenses where a reasonable basis of allocation exists. Segment assets include all assets used by a segment and consist principally of cash, receivables, inventories, intangibles and property, plant and equipment, net of allowances and accumulated depreciation and amortisation. While most assets can be directly attributed to individual segments, the carrying amount of certain assets used jointly by two or more segments is allocated to segments on a reasonable basis. Segment liabilities consist principally of payables, employee benefits, accrued expenses, provisions and borrowings. Inter-segment transfers Segment revenues, expenses and results include transfers between segments. All other intersegment transfers are priced on an “arm’s-length” basis and are eliminated on consolidation. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 61 17. OPERATING SEGMENTS continued Primary reporting – business segments Property investment & development Investment Services Intersegment eliminations/ unallocated Consolidated $’000 $’000 $’000 $’000 2024 Sales to external customers 1,498 - - 1,498 Intersegment sales - - - - Total sales revenue 1,498 - - 1,498 Other revenue - - - - Total segment revenue 1,498 - - 1,498 Segment result Profit/(loss) before tax (3,768) - - (3,768) Tax expense - - - - Net profit/(loss) (3,768) - - (3,768) Segment assets 31,938 - - 31,938 Segment liabilities 12,566 - - 12,566 Acquisition of non-current assets 104 - - 104 Depreciation and amortisation expense - - - - 2023 Sales to external customers 1,480 - - 1,480 Intersegment sales - - - - Total sales revenue 1,480 - - 1,480 Other revenue - - - - Total segment revenue 1,480 - - 1,480 Segment result Profit/(loss) before tax 182 - - 182 Tax expense - - - - Net profit/(loss) 182 - - 182 Segment assets 36,581 - - 36,581 Segment liabilities 13,441 - - 13,441 Acquisition of non-current assets 573 - - 573 Depreciation and amortisation expense - - - - For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 62 18. CASH FLOW INFORMATION a. Reconciliation of net cash provided by/(used in) from operating activities Consolidated 2024 2023 $’000 $’000 Profit/(Loss) for the year (3,768) 182 Change in fair value of investment properties 916 (774) Doubtful debt and investment provision 2,395 258 Gain on disposal of investment property (235) - Change in operating assets and liabilities: (Increase)/decrease in trade and other receivables (41) 353 (Increase)/decrease in other current assets 153 (158) Increase/(decrease) in trade and other creditors 27 (307) (Increase) in deferred tax assets - - Increase in deferred tax liabilities - - Net cash (used in) / provided by operating activities (553) (446) b. Significant non-cash transactions No other significant non-cash transactions occurred during the year. 19. CONTROLLED ENTITIES Name of entity Class of Share/unit Equity Holding Country of formation or incorporation 2024 2023 % % HTH Holdings Pty Limited Ordinary 100 100 Australia Hudson Property Group Limited Ordinary 100 100 Australia Hudson Land Pty Limited Ordinary 100 100 Australia Hudson Bowen Hill Pty Ltd Ordinary 100 100 Australia Hudson Regent Development Pty Ltd Ordinary 100 100 Australia Regent Property Trust Ordinary 100 100 Australia For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 63 20. CONTINGENT ASSETS AND LIABILITIES Deed of Cross Guarantee As at 31 December 2024, Hudson Investment Group Limited, HTH Holdings Pty Ltd, Hudson Property Group Limited, Hudson Land Pty Ltd, Hudson Regent Development Pty Ltd and Hudson Bowen Hills Pty Ltd entered a Deed of Cross Guarantee under which each Company guarantees the debts of the others. By entering into the deed, the wholly owned entities have been relieved from the requirement to prepare a financial report and Directors’ report under Class Order 98/1418 (as amended by Class Order 98/2017) issued by the Australian Securities & 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 Hudson Investment Group Limited, they also represent the ‘Extended Closed Group’. These consolidated financial statements for the year ended 31 December 2024 represent those of the “Closed Group”. 21. EVENTS OCCURRING AFTER BALANCE DATE As at the date of lodgement of the 2024 Hudson Investment Group Limited Annual Report, the Directors note that on 31 March 2025, the Company’s auditor (KSB) issued a Disclaimer of Opinion (Disclaimer of Opinion) stating: “…we (KSB) were unable to obtain sufficient appropriate audit evidence regarding the recoverability of the receivable, existence (ownership of receivable) and the appropriateness of the going concern assumption used in the preparation of the financial report. These issues are material and persuasive to the financial report.” The Directors disagree with this Disclaimer of Opinion. Subsequent to the issue of the Disclaimer of Opinion, the directors have provided KSB with sufficient evidence showing: i) The Company has obtained a registered second mortgage over the land situated at 43 Regent Street Woolloongabba Qld ii) The Company has caused the financial report for the year ended 31 December 2024 to show a full provision over the recoverability of the remaining unpaid debt amounting to $2.395 million owed by the purchaser even though the directors believe that the debt will be paid in full by 30 June 2025 iii) Provided an updated cash flow for the year ended 31 December 2025 showing a positive cash flow after eliminating the remaining recoverable debt of $2.395 million and iv) Provided additional documents stating that no Hudson director has any interest in the Woolloongabba land subject to the now registered second mortgage and the sales transaction was at arms length. KSB remains of the view expressed in the Disclaimer of Opinion. At the date of this report there are no other matters or circumstances which have arisen since 31 December 2024 that have significantly affected or may significantly affect: • The operations, in financial years subsequent to 31 December 2024 of the Group; • The results of those operations; or • The state of affairs in financial years subsequent to 31 December 2024 of the Group. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 64 22. PARENT ENTITY FINANCIAL INFORMATION a. Summary financial information The individual financial statements for the parent entity show the following aggregate amounts: Parent Entity 2024 $’000 2023 $’000 Statement of Financial Position Assets Current assets 528 473 Non-current asset 17,670 17,988 Total assets 18,198 18,461 Liabilities Current liabilities 215 152 Non-Current liabilities 7,975 7,109 Total liabilities 8,190 7,261 Shareholder’s equity Issued Capital 63,397 63,397 Reserves - - Accumulated losses (53,389) (52,197) Total shareholders’ equity 10,008 11,200 Statement of Profit and Loss and Other Comprehensive Income Profit/(Loss) for the year (1,192) (983) Total comprehensive profit/(loss) (1,192) (983) b. Guarantees entered into by the parent entity Hudson Investment Group Limited has provided guarantees to several wholly owned controlled entities within the Group. No liability was recognised by Hudson Investment Group Limited in relation to these guarantees as the likelihood of payment is not probable. c. Contingent liabilities of the parent entity Refer to note 20. d. Contractual commitments by the parent entity for the acquisition of property, plant and equipment. There are no contractual commitments by the parent entity for the acquisition of property, plant and equipment. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 65 b. 23. KEY MANAGEMENT PERSONNEL DISCLOSURES a. Directors The following persons were Directors of Hudson Investment Group Limited during the financial year unless otherwise stated: John W Farey Non-Executive Director Appointed 1 February 2002 Alan P Beasley Managing Director Appointed 19 January 2015 Wei Huang Executive Director Appointed 4 June 2019 John J Foley Non-Executive Director Appointed 6 August 2014 Dr Cheng Fong Han Non-Executive Director Resigned 24 March 2025 Pin Chua Non-Executive Director Appointed 27 September 2022 Warren Choo Non-Executive Director Appointed 24 March 2025 Other key management personnel The following persons were key management personnel of Hudson Investment Group Limited during the financial year: Vincent Tan Director of controlled entity Henry Kinstlinger Joint Company Secretary Appointed 16 March 2016 Mona Esapournoori Joint Company Secretary Appointed 5 June 2018 Francis Choy Chief Financial Officer For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 66 23. KEY MANAGEMENT PERSONNEL DISCLOSURES continued c. Compensation of Directors and other key management personnel Short Term Employee Benefits Post- Employment Long Term Benefits Salary and other fees Non-Monetary Benefits Superannuation Long Service Leave Total $ $ $ $ $ Consolidated 2024 Directors John W Farey 12,000 - - - 12,000 Alan P Beasley 150,000 - - - 150,000 Wei Huang * 150,000 - - - 150,000 John J Foley - - - - - Dr Cheng Fong Han - - - - - Pin Chua - - - - - Director - Total 312,000 - - - 312,000 KMP Henry Kinstlinger - - - - - Mona Esapournoori 12,000 - 1,350 200 13,550 Francis Choy 120,000 - 13,500 1,990 135,490 KMP - Total 132,000 - 14,850 2,190 149,040 2023 Directors John W Farey 12,000 - - - 12,000 Alan P Beasley 150,000 - - - 150,000 Wei Huang * 180,000 - - - 180,000 John J Foley - - - - - Dr Cheng Fong Han - - - - - Pin Chua - - - - - Director - Total 342,000 - - - 342,000 KMP Vincent Tan - - - - - Henry Kinstlinger - - - - - Mona Esapournoori 12,000 - 1,290 200 13,490 Francis Choy 120,000 - 12,900 1,984 134,884 KMP - Total 132,000 - 14,190 2,184 148,374 The amounts reported represent the total remuneration paid by entities in the Group in relation to managing the affairs of all the entities within the Group. The remuneration has not been allocated between the individual entities within the Group as this would not be practicable. *Mr Huang received director fee $150,000 p.a. (2023: $150,000 p.a.) and consultancy fee Nil (2023: $30,000) via related entity There are no performance conditions related to any of the above payments. There is no other element of Directors and other Key Management Personnel remuneration. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 67 23. KEY MANAGEMENT PERSONNEL DISCLOSURES continued d. e. Shareholdings and option holdings of key management personnel Shares held in Hudson Investment Group Limited The numbers of shares in the Company held during the financial year by each director of Hudson Investment Group Limited and other key management personnel of the Group, including their personally related parties, are set out below. There were no shares granted during the reporting period as compensation. Direct and indirect interest in ordinary shares Ordinary Share Direct Interest Balance at start of year-shares Changes during the year-shares Balance at end of year-shares 2024 Directors John W Farey 1,000 - 1,000 Alan P Beasley - - - Wei Huang - - - John J Foley - - - Dr. Cheng Fong Han - - - Pin Chua - - - 2023 Directors John W Farey 1,000 - 1,000 Alan P Beasley - - - Wei Huang - - - John J Foley - - - Dr. Cheng Fong Han - - - Pin Chua - - - Ordinary Share Indirect Interest Balance at start of year-shares Changes during the year-shares Balance at end of year-shares 2024 Directors John W Farey 575,561 6,312,419 6,887,980 Alan P Beasley 160,000 - 160,000 Wei Huang 6,000,000 - 6,000,000 John J Foley - - - Dr. Cheng Fong Han - - - Pin Chua - - - 2023 Directors John W Farey - 575,561 575,561 Alan P Beasley 160,000 - 160,000 Wei Huang 6,000,000 - 6,000,000 John J Foley - - - Dr. Cheng Fong Han - - - Pin Chua - - - No options over unissued shares were granted during the year and no options have been granted in the period since the end of the financial year and to the date of this report. At the date of this report there were no unissued shares in the capital of the Company under option. Loans to key management personnel There was no loan made to Directors and other Key Management Personnel (KMP) of Hudson Investment Group Limited during the year. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 68 24. RELATED PARTY DISCLOSURES a. Parent entity The parent entity and ultimate Australian parent entity is Hudson Investment Group Limited (the Company). b. Subsidiaries Interests in subsidiaries are disclosed in Note 19. c. Key management personnel compensation Key management personnel compensation information is disclosed in Note 23. d. Transactions with related parties The following transactions occurred with related parties during the year Consolidated 2024 2023 $ $ Corporate services fee paid - Paid to Hudson Asset Management Pty Ltd 144,000 144,000 Corporate services fee paid The Group paid corporate services fee to Hudson Asset Management Pty Limited of $144,000 (2023: $144,000) as payment for office rent, administration and office running expenses incurred on behalf of the group under corporate service agreement. e. Outstanding balances There is no outstanding balances at the reporting date in relation to transaction with related parties: Consolidated 2024 2023 $000 $000 Receivable Controlled Entities - - Provision for doubtful debts - - Payable Controlled Entities - - f. Guarantees No guarantees were given or received from related parties during the year. g. Terms and conditions All transactions were made on normal commercial terms and conditions and at market interest rates, except that there are no fixed terms or repayment of loans between the parties. For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 69 25. REMUNERATION OF AUDITORS Consolidated 2024 2023 $ $ Audit services: Amounts paid or payable to auditors for audit and review of the financial report for the parent entity or any entity in the Group Review services fee 10,995 10,450 Audit fee 18,345 17,450 Taxation and other advisory services: Amounts paid or payable to the Auditors for non-audit services for the parent entity or any entity in the Group Taxation services 3,595 3,395 Advisory services - - Total 32,935 31,295 For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 70 DECLARATION BY DIRECTORS The directors of the Company declare that: 1. The financial statements, comprising the statement of profit or loss and other comprehensive income, statement of financial position, statement of cash flows, statement of changes in equity, accompanying notes, are in accordance with the Corporations Act 2001 and: (a) comply with Accounting Standards which as stated in accounting policy note 1 to the financial statements, constitutes explicit and unreserved compliance with international Financial Reporting Standards (IFRS); and (b) give a true and fair view of the financial position as at 31 December 2024 and of the performance for the year ended on that date of the Company and the Group. 2. In the directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable. 3. The remuneration disclosures included on pages 12 to 14 of the Directors’ Report (as part of audited Remuneration Report), for the year ended 31 December 2024, comply with section 300A of the Corporations Act 2001. 4. The directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer required by section 295A. The entities identified in Note 19 are parties to the deed of cross guarantee under which each company guarantees the debts of the others. At the date of this declaration there are reasonable grounds to believe that the companies which are parties to this deed of cross guarantee will as a Group be able to meet any obligations or liabilities to which they are, or may become, subject to, by virtue of the deed of cross guarantee described in Note 21. This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the directors by: Alan Beasley Wei Huang Managing Director Executive Director Sydney 28 March 2025 For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 71 INDEPENDENT AUDITORS’ REPORT For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 72 For personal use only Hudson Investment Group Limited ACN 004 683 729 Annual Report 31 December 2024 Page | 73 SHAREHOLDER INFORMATION As at 28 February 2025 A.   Substantial Holders Those shareholders who have lodged notice advising substantial shareholding under the Corporations Act 2001 are as follows: Shareholder Citicorp Nominees Pty Ltd Millenium Investment Group Pty Ltd RafflesCo Limited Waytex Australia Pty Ltd Raffles Nominees Pty Ltd Yan Zhou YLH Investment Pty Ltd Min Lin No. of Shares 11,187,345 6,500,000 6,270,000 6,000,000 5,666,656 4,000,000 3,500,000 3,000,000 % held 18.85 10.95 10.56 10.11 9.55 6.74 5.90 5.05 B.   Distribution of Equity Securities % of Issued Range Total Holders Units Capital 1 - 1,000 260 62,311 0.10 1,001 - 5,000 82 217,341 0.37 5,001 - 10,000 27 218,197 0.37 10,001 - 100,000 32 1,221,144 2.06 100,001 and above 32 57,640,942 97.10 Rounding Total 433 59,359,935 100.00 C.   Unmarketable Parcels Minimum Parcel size Holders Units Minimum $500.00 parcel at $0.175 per unit 2,858 311 158,137 D.   Twenty Largest Shareholders The names of the twenty largest holders of quotes equity securities aggregated are listed below: Rank Name Units % Units 1 CITICORP NOMINEES PTY LTD 11,187,345 18.85 2 MILLENNIUM INVESTMENT GROUP PTY LTD 6,500,000 10.95 3 RAFFLESCO LTD 6,270,000 10.56 4 WAYTEX PTY LIMITED 6,000,000 10.11 5 RAFFLES NOMINEES PTY LIMITED 5,666,656 9.55 6 YAN ZHOU 4,000,000 6.74 7 YLH INVESTMENT PTY LTD 3,500,000 5.90 8 MIN LIN 3,000,000 5.05 9 JT CAPITAL PTY LTD 1,538,337 2.59 10 MR AARON LANGLEY 1,500,000 2.53 11 G & H BRASHER PTY LTD 1,200,000 2.02 12 MS KOON LIN VENUS CHIU 1,160,000 1.95 13 LIP KOON HWANG 1,000,000 1.68 14 MILLENNIUM PROPERTY INVESTMENTS PTY LTD 558,100 0.94 15 JT CAPITAL HOLDINGS PTY LTD 555,766 0.94 16 SEI HAN TAN 500,000 0.84 17 AZHAR HEWITTSEN ARIFFIN BIN IBRAHIM 442,500 0.75 18 MS RACHEL ZHI TING TAN 377,300 0.64 19 MR VINCENT SEE YIN TAN 359,574 0.62 20 HUDSON PACIFIC GROUP LTD 337,633 0.57 Totals: Top 20 holders of FULLY PAID SHARES 55,653,211 93.78 For personal use only For personal use only

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