Annual Report
Contents
Results at a Glance
Chairman’s Letter
Company Profi le
Regional Overview
CEO Report
People, Community and the Environment
Directors’ Report
Auditor’s Independence Declaration
Income Statement
Balance Sheet
Cash Flow Statement
Statement of Changes in Equity
Notes to the Financial Statements
Directors’ Declaration
Independent Audit Report
Corporate Governance Statement
Additional Information
Corporate Directory
2
3
5
6
7
13
15
27
28
29
30
31
32
72
73
74
85
86
© 2007 Infomedia Ltd. All rights reserved worldwide. This
document may not be reproduced in whole or in part without
the express written permission of Infomedia Ltd.
1 infomedia.com.au
Results at a Glance
Sales Revenue
(in $ millions)
NPAT
(in $ millions)
‘07
‘06
‘05
‘04
‘03
‘02
‘01
‘00
‘07
‘06
‘05
‘04
‘03
‘02
‘01
‘00
0
10
20 30
40
50
60
70
0
5
10
15
20
25
EBITDA
(in $ millions)
0
10
20
30
40
Product Subscriptions
EPCs
Superservice Menus
‘07
‘06
‘05
‘04
‘03
‘02
‘01
‘00
‘000’s
60
50
40
30
20
10
0
‘98
‘99
‘00
‘01
‘02
‘03
‘04
‘05
‘06
‘07
infomedia.com.au 2
Annual Report
Chairman’s Letter
Microcat and PartFinder grew by an impressive 11.4% overall...while
Superservice Menus brought the Company’s total recurring subscription
numbers to 55,779, an all time record.
DEAR FELLOW SHAREHOLDERS,
work coming from the newest branches
I believe it is fair to characterise FY2007
of our tree.
as having been a year of rejuvenation for
I’m sure you have also been pleased by our
the Company. This is borne out by:
announcements of the many important
(cid:129) Our continuing release of category
leading new generation Electronic
Parts Catalogue (EPC) applications
to a broader range of customers;
data licenses which have been renewed
this year, and the many promising new li-
censes that have also been entered into. Of
particular note, the renewal of our licenses
with Ford in the USA and Europe sees our
(cid:129) Our record levels of product subscrip-
positive support of Ford dealers continu-
tions and of new product launches both
ing towards its third decade. Our new data
by country and by automakers;
license with General Motors USA which
(cid:129) Our development and release of a new
subscription application genre, and;
(cid:129) Our internal business streamlining.
Microcat® and PartFinder® grew by
impressive 11.4% overall, to a
an
record 53,165
Superservice MenusTM brought
Company’s total recurring subscription
subscriptions, while
the
allows us to develop Superservice Menus
for its vast league of North American
dealers is equally exciting. So too are the
new engagements between Infomedia and
Daihatsu, Hyundai and Kia around the
world, which means that our Company
now supplies Superservice Menus for nine
automotive manufacturers in 20 countries.
These new and renewed licenses, the new
numbers to 55,779, an all-time record.
generation of product invention, the wid-
Our world-class EPC also expanded to
ening of our customer base and the record
support the commercial bus industry,
subscription numbers have strengthened
with the introduction of Microcat for
our Company and its product brands, thus
Temsa in Europe.
reducing its economic risks.
The Auto PartsBridgeTM system,
tially developed for Toyota in the USA,
ini-
As projected, due to higher currency
translations and subscription reductions
represents a major new application tech-
in our total General Motors (GM) USA
nology from Infomedia’s latest generation
numbers, revenue declined by 2.0% from
of product inventors. This achievement
$56.5 million in FY2006 to $55.4 million
is destined to become an important
in FY2007, and normalised Net Profi t
product for both the Company and the
After Tax (NPAT) declined by 7.3% from
automotive industry, and it is encourag-
$16.5 million in FY2006 to $15.3 million
ing to see such innovative and successful
in FY2007.
3 infomedia.com.au
Annual Report
...the renewal of our licenses with Ford in the USA and Europe sees our
positive support of Ford dealers continuing towards its third decade.
Chairman’s Letter
The greater percentage decline between
resources from our Dealer Management
ing and Information Systems teams.
revenue and NPAT is primarily a refl ection
System platforms, whose results after six
Please take the time to have a visit.
of three factors: the fi rst being our higher
years had not realised the expectations we
investment this year in new product de-
had for them. Accordingly, Management
velopment, such as Auto PartsBridge and
arranged the sale of the Business Systems
more Superservice Menus country/au-
Division to Reynolds & Reynolds Australia.
In closing, I’d like you to know that
I continue to be optimistic about
the outlook for the Company. If
you are like me, then you recognise
tomaker versions, which we fully expect
will make material contributions to the
business beginning in FY2009; the second
being our relatively fi xed internal cost
structure, especially in overseas subsidiar-
ies; and fi nally, the third being the impact
of leasing our Corporate Headquarters
since its sale in 2006. On all these mat-
ters, I believe that our Management has a
fi rm grasp, and in the face of sustainable
growth, they will work to the Company’s
long term advantage.
Also during the year, upon the retirement
and take into account the swings
of Mr Geoffrey Henderson, the Board
and roundabouts of currency ef-
took the opportunity to reconsider its own
fects, such as those headwinds the
structure. This resulted in the activities of
Company has been pushing against
the Remuneration & Nomination Commit-
for several years. This perspective
tee being re-absorbed into the whole of
gives me added comfort and insight
the Board, and the Corporate Governance
into the underlying wellbeing of the
Committee and the Audit & Risk Commit-
Company when considered in con-
tee being merged, with Mr Andrew Moffat
junction with the progress I share
as Chairman. Ms Fran Hernon, who was
with you in this Report.
Chairman of the Remuneration & Nomina-
tion Committee, remains the lead Director
In line with market expectation and
on the Board for such matters. As a result
despite the year on year reduction of
of these changes, the Board has reduced
NPAT, the fully-franked dividend of 4.0¢
from six Directors to fi ve.
For these reasons and for its overall
performance that you will read about
herein, I commend this Annual Report
to you, and look forward to seeing
you at the Annual General Meeting
remained constant and within our payout
policy. In addition, the Company paid a
special dividend of 3.5¢ in October 2006.
If you haven’t visited the Company
if you are able to attend in person.
website, www.infomedia.com.au in a while,
you may not be aware that it, too, has had
During the year, the Board supported
a major rejuvenation that I believe makes
Management’s recommendation to con-
it much more informative and interesting
solidate the Company’s focus onto our
to customers and investors. Its clean fresh
enabling-technology applications, thus
look and much improved navigation de-
releasing our fi nancial and managerial
sign were created in-house by our Market-
Richard David Graham
Chairman of the Board
infomedia.com.au 4
Annual Report
Company Profi le
INFOMEDIA LTD IS A LEADING PROVIDER
OF INFORMATION SOLUTIONS TO THE
POST-SALE PARTS AND SERVICE SECTOR
OF THE GLOBAL AUTOMOTIVE INDUSTRY.
The Company’s automotive products
are subscribed to by over 55,000 users
from franchised dealers to independent
auto dealers and independent auto trade
repairers. Infomedia’s Microcat® Electronic
Parts Catalogues, or EPCs, enable dealers
to perform the critical function of quickly
and accurately
identifying
for
sale
replacement auto parts manufactured by
the world’s leading auto manufacturers
– often referred to as “genuine” or Original
Equipment
(OE)
replacement parts.
Infomedia also provides other high-value,
complementary products to the dealer
and trade repairer market,
including
its Superservice MenusTM for quick and
accurate service quotations and other parts
and service related data products. The
Company is also utilising its proprietary
technology and process expertise to
introduce EPCs
into other complex
parts and service dependent industries,
including the whitegoods industry with
its PartFinder® brand EPC.
The Company’s products are used every
day by dealership staff in over 160
countries and in 28 languages and have a
PC based user/client interface. There are
thousands of parts in an average car and a
signifi cant portion of the manufacturers’
parts data will change on a monthly
basis. An ongoing monthly subscription
with Infomedia ensures that customers
receive and access the very latest parts
information on CD-ROM, DVD-ROM
or via the Internet.
Timeline
(cid:129) Software and peripherals importer and distributor
Infomagic Australia Pty Ltd formed (1988)
(cid:129) Acquisition of Datateck Publishing Pty Ltd
and Online Computing Pty Ltd
(cid:129) Microcat for GM North America, Hyundai USA,
Toyota Europe and Toyota North America released
(cid:129) Infomedia Ltd formed to add software
development capability to Infomagic (1990)
(cid:129) Listed on Australian Stock Exchange
(cid:129) Microcat for Honda, Hyundai and Isuzu
(cid:129) Microcat for Ford Australia released (1991)
released in Australia
(cid:129) PartFinder for GM/Holden released (1992)
(cid:129) Microcat for Nissan Australia released (1995)
(cid:129) Awarded NSW Exporter of the Year
(Information & Communications Technology)
(cid:129) Awarded Australian Exporter of the Year
(Information & Communications Technology)
1988 –1996
1997–1999
2000
2001
2002
(cid:129) Microcat for Ford Europe and PartFinder
for Suzuki Australia released (1997)
(cid:129) Microcat for Mitsubishi Australia
and Toyota Australia released (1998)
(cid:129) Microcat for Daewoo Australia,
Daihatsu Australia, Daihatsu Europe
and Ford North America released (1999)
(cid:129) PartFinder for Electrolux Australia released (1999)
(cid:129) Microcat for Daihatsu Rest of World,
Ford Asia Pacifi c, GM Asia Pacifi c,
Hyundai Global and Land Rover Global released
(cid:129) PartFinder for Electrolux New Zealand released
5 infomedia.com.au
Annual Report
Regional Overview
Asia Pacifi c
North & Latin America
Europe &
Rest of World
(cid:129) Microcat LIVE for Toyota Germany released
(cid:129) Superservice Menus for Mitsubishi Australia
and Toyota Australia released
(cid:129) Internet version of Lubrication & Tune-Up
Guide released
(cid:129) Awarded Australian Exporter of the Year Award
(Information & Communications Technology)
(cid:129) Awarded Australian Government Export Finance
and Insurance Corporation Trailblazers award
(cid:129) Auto PartsBridge for Toyota Motor Sales, US released
(cid:129) Microcat for Temsa buses released
(cid:129) Lubrication & Tune-Up Guide released on CD-ROM
(Infomedia’s fi rst customer in the bus segment)
(cid:129) Microcat MARKET for Toyota Australia released
(cid:129) Microcat MARKET for Ford Australia released
(cid:129) Superservice Menus for Daihatsu UK and
Hyundai Sweden released
(cid:129) Established North American offi ce
(cid:129) Superservice Menus for Daihatsu Austria,
Hyundai Belgium, Hyundai Finland,
Hyundai Luxembourg, Hyundai Netherlands,
Hyundai Norway, Kia Australia and Kia UK released
2003
2004
2005
2006
2007
(cid:129) Microcat MARKET for Toyota Europe released
(cid:129) Microcat for Isuzu (medium duty trucks)
(cid:129) PartFinder for Whirlpool Australia released
(cid:129) Superservice Menus for Daihatsu Australia,
Daihatsu UK, Ford Australia, Holden Australia
and Hyundai Australia released
(cid:129) Established European offi ce and new corporate
headquarters in Australia
released in North America
(cid:129) Microcat for Kia released worldwide
(excluding China, Korea and USA)
(cid:129) Microcat LIVE for Mazda Japan released
(cid:129) Superservice Menus for Cadillac Corvette Europe,
Daihatsu Germany and Subaru UK released
(cid:129) Sale of the Company’s Business Systems Division
infomedia.com.au 6
Annual Report
CEO Report
Superservice Menus subscription numbers grew by
56% to 2,614 over the previous corresponding period.
AS CHIEF EXECUTIVE OFFICER OF
INFOMEDIA LTD, I AM PROUD OF OUR
ACHIEVEMENTS DURING THE PAST 12
MONTHS. I commend the commitment,
initiative and focus the team has shown,
resulting in the launch of a number
of new products to new customers,
as well as a successful renewal of
existing agreements. These new product
offerings and renewals position the
Company well for the future.
Our objectives in the past year have
been to:
(cid:129) Maintain focus on our core automotive
business by delivering quality products;
(cid:129) Renew our existing data licence
Superservice Menus
subscriptions continue to grow
As reported last year, Superservice Menus
continues to be received favourably by
both new markets and new manufacturers.
This past year has seen the release
of Superservice Menus for Daihatsu
Austria, Hyundai Belgium, Hyundai
Finland, Hyundai Luxembourg, Hyundai
Netherlands, Hyundai Norway, Kia
Australia and Kia UK. Subscriptions
across other markets and franchises also
continue to grow.
As at the end of the fi nancial year, the
Company now supplies Superservice
Menus for nine automotive manufacturers
in 20 countries. 2008 will see the fi rst steps
contracts so we have a commitment
taken to deliver Superservice Menus into
from our partners well into the future;
the North American and Latin American
(cid:129) Successfully deliver new technologies
and products for existing customers;
(cid:129) Explore opportunities in
complementary segments; and
(cid:129) Deliver returns for shareholders.
Operational review
Key operational highlights:
(cid:129) Growth in Superservice Menus adoption;
(cid:129) Development of Auto PartsBridge;
(cid:129) Diversifi cation into the bus segment;
(cid:129) Renewal of a number of the Company’s
key data licence contracts;
(cid:129) Consolidation of the Company’s business.
markets. We will commence sales to more
countries and more automakers, adding to
our recurring revenue stream.
Superservice Menus is now used in Kia
dealerships in Australia and the UK
7 infomedia.com.au
Annual Report
“I am excited about Auto PartsBridge and the opportunities it creates for Infomedia in this new
market segment of the automotive industry. We’re delighted that Toyota has chosen Infomedia as
their partner for this latest industry leading solution.”
CEO Report
(cid:10)(cid:156)(cid:213)(cid:152)(cid:204)(cid:192)(cid:136)(cid:105)(cid:195)(cid:202)(cid:220)(cid:136)(cid:204)(cid:133)(cid:202)(cid:45)(cid:213)(cid:171)(cid:105)(cid:192)(cid:195)(cid:105)(cid:192)(cid:219)(cid:136)(cid:86)(cid:105)(cid:202)(cid:31)(cid:105)(cid:152)(cid:213)(cid:195)(cid:202)(cid:143)(cid:62)(cid:213)(cid:152)(cid:86)(cid:133)(cid:105)(cid:96)
Broadening our core product range
This year saw the opportunity to increase
the productivity tools on offer from
Infomedia. The fi rst opportunity was
to create a version of the Company’s
Microcat® Electronic Parts Catalogue
(EPC) for the Temsa bus company. This
product represented the Company’s fi rst
foray outside of the passenger vehicle
segment while still remaining within the
core automotive sector. Temsa is a Turkish
bus manufacturer and produces 7% of all
buses manufactured in Western Europe.
The company has experienced year on
year growth and is seeking to increase its
Infomedia is now supplying Microcat to
all dealers in the territories where Temsa
buses are distributed and serviced (over 30
countries; predominantly within Europe).
The second opportunity came via the
development of a solution designed to
link parts dealers with their collision repair
customers. Discussions began in late 2005,
and Infomedia was invited by Toyota
Motor Sales (TMS), USA to participate in
a quotation process to produce an online
solution that would make it possible for
parts dealers to transact with collision
repairers. The result of our success in that
process is Auto PartsBridgeTM. Infomedia
since then has worked closely with Toyota,
share of the bus manufacturing business.
Toyota dealers and collision repairers
Karl Krug (TMS) and Steve Fogarty
(Infomedia) at the fi rst Auto PartsBridge
pilot dealership in the USA
infomedia.com.au 8
Annual Report
CEO Report
“It was critical for Toyota to fi nd a business
partner who can help us provide this data
in a way that offers the full value of the
data, yet is simple for the shops to use
and understand. What impressed us most
about Infomedia was their dedication
to understanding the end users and
designing a system that is primarily built
around the needs of the dealerships and
collision centres.”
Karl Krug – Senior Wholesale
Collision Parts Administrator,
Toyota Motor Sales, USA.
9 infomedia.com.au
(cid:1)(cid:213)(cid:204)(cid:156)(cid:202)(cid:42)(cid:62)(cid:192)(cid:204)(cid:195)(cid:9)(cid:192)(cid:136)(cid:96)(cid:125)(cid:105)(cid:202)(cid:76)(cid:213)(cid:195)(cid:136)(cid:152)(cid:105)(cid:195)(cid:195)(cid:202)(cid:171)(cid:192)(cid:156)(cid:86)(cid:105)(cid:195)(cid:195)(cid:202)(cid:118)(cid:143)(cid:156)(cid:220)
(cid:85)(cid:202)(cid:31)(cid:62)(cid:204)(cid:86)(cid:133)(cid:202)(cid:22)(cid:152)(cid:219)(cid:156)(cid:136)(cid:86)(cid:105)(cid:195)(cid:202)(cid:204)(cid:156)(cid:202)(cid:34)(cid:192)(cid:96)(cid:105)(cid:192)(cid:195)
(cid:85)(cid:202)(cid:20)(cid:105)(cid:152)(cid:105)(cid:192)(cid:62)(cid:204)(cid:105)(cid:202)(cid:192)(cid:105)(cid:171)(cid:156)(cid:192)(cid:204)(cid:195)
(cid:85)(cid:202)(cid:45)(cid:133)(cid:156)(cid:220)(cid:202)(cid:147)(cid:136)(cid:195)(cid:195)(cid:105)(cid:96)(cid:202)(cid:195)(cid:62)(cid:143)(cid:105)(cid:195)(cid:202)(cid:156)(cid:171)(cid:171)(cid:156)(cid:192)(cid:204)(cid:213)(cid:152)(cid:136)(cid:204)(cid:136)(cid:105)(cid:195)
(cid:10)(cid:34)(cid:29)(cid:29)(cid:22)(cid:45)(cid:22)(cid:34)(cid:32)
(cid:44)(cid:13)(cid:42)(cid:1)(cid:22)(cid:44)(cid:13)(cid:44)
(cid:22)(cid:147)(cid:171)(cid:156)(cid:192)(cid:204)(cid:195)
(cid:13)(cid:195)(cid:204)(cid:136)(cid:147)(cid:62)(cid:204)(cid:105)
(cid:12)(cid:13)(cid:1)(cid:29)(cid:13)(cid:44)
(cid:13)(cid:221)(cid:171)(cid:156)(cid:192)(cid:204)(cid:195)
(cid:34)(cid:192)(cid:96)(cid:105)(cid:192)
(cid:22)(cid:147)(cid:171)(cid:156)(cid:192)(cid:204)(cid:202)(cid:22)(cid:152)(cid:219)(cid:156)(cid:136)(cid:86)(cid:105)(cid:195)
(cid:12)(cid:105)(cid:62)(cid:143)(cid:105)(cid:192)(cid:202)(cid:31)(cid:62)(cid:152)(cid:62)(cid:125)(cid:105)(cid:147)(cid:105)(cid:152)(cid:204)
(cid:45)(cid:222)(cid:195)(cid:204)(cid:105)(cid:147)(cid:202)(cid:173)(cid:12)(cid:31)(cid:45)(cid:174)
to develop and refi ne Auto PartsBridge.
The product introduces a new level of
transparency regarding the parts required
for a collision repair and helps Toyota
dealerships provide higher quality service
to their collision repair customers. At the
same time, the system provides accurate
parts data to the collision repairers to help
them prepare estimates and improve their
production processes. A pilot program
for Auto PartsBridge commenced in April
2007 in selected markets across the United
States and is proceeding positively.
Ongoing commitment from partners
This year saw the renewal of a number
of key contracts that the Company
holds with our automotive partners.
The fi rst contract to be renewed in
this fi nancial year was the Company’s
contract with Land Rover. The renewed
contract ensures the supply of Microcat
to Land Rover dealers globally through
to at least June 2010. Early in 2007, the
Company renewed our agreement with
Ford Canada, until 2009, which will also
mark a 10 year relationship between the
two companies.
The renewal of our agreement with Ford
Europe was testament to the regard in which
the Microcat solution is held throughout
the Ford European dealerships and its
importance as an independent and mission
critical business tool for professional parts
sales. Competition in this marketplace
has intensifi ed in recent years; however,
the Company remains confi dent that
we deliver products which assist dealers
increasing sales and productivity.
in
The Company will also launch both
Microcat® LIVETM
and Microcat®
MARKET TM during FY2008 and these
Annual Report
Microcat is used every day by over 53,000 subscribers,
in more than 160 countries and in 28 languages.
CEO Report
products will be offered to all Ford dealers
(cid:129) Superservice Menus
subscription
across Europe.
Just before the close of this fi nancial year
Infomedia also renewed its data licence
agreement with Ford North America
through to 2010. The Company has a
strong product advocate base within the
numbers grew by 56% to 2,614 over
the previous corresponding period.
Subscription growth was driven
primarily across European markets
with particular emphasis on Daihatsu
and Hyundai.
USA and the dedicated team in the IFM
(cid:129) Electronic Catalogue and Publishing
North America offi ce continues to provide
sales revenue increased by 3% to $53
outstanding service to our customers there.
million over the equivalent prior period.
Consolidation of the business
This growth was impaired as a result of
the rising strength of the Australian
Late in 2006, the Company sold its Business
dollar throughout the year.
Systems Division, enabling the Company
to focus on its key areas of expertise:
developing and supplying Electronic Parts
Catalogues and service quoting systems
for the automotive industry globally; plus
information creation and management for
the domestic automotive and oil industries.
Financial results
In terms of fi nancial results for 2007, the
Company is pleased to report net profi t
after tax of $15.3 million. This fi gure is
within the guidance previously provided
to the market in December 2006.
Key highlights
(cid:129) Consolidated sales revenue of $54.6
million only included fi ve months of
the
Business
Systems Division
compared to the full 12 months
of the comparative period following
the sale of the division. The division
was sold on 1 December 2006 for
gross proceeds of $1.5 million.
The absence of the Business Systems
Division
in
the
second half
had little impact on reported profi ts
as this business was operating on a
near breakeven basis.
(cid:129) Cash fl ows from operations remain
strong with $14 million
in cash
(cid:129) Electronic Parts Catalogue subscription
generation. Total dividend payments
numbers grew by 11% to 53,165. This
to
shareholders over
the 2007
subscription growth was driven
fi nancial year amounted to $24.4
primarily
through
the
successful
million. Notwithstanding these returns,
worldwide launch into Kia markets
the balance sheet remains in a strong
coupled with organic growth within
position with $15.7 million cash on
the existing portfolio.
hand at 30 June 2007.
infomedia.com.au 10
Annual Report
CEO Report
Put simply, we turn data into meaningful information.
Looking forward
Operational outlook
The coming year will see many releases of
Microcat LIVE and Microcat MARKET
globally. These exciting products will
Infomedia regularly reviews our product
gain traction in all markets and increase
development approach, how we are
the customer touch points with Infomedia.
positioned to address future challenges,
We are also confi dent about the release
and our capacity to respond to the
of Auto PartsBridge for Toyota Motor
changing needs of our customers. The
Sales in the US and the benefi ts it brings
Company remains agile in its approach
to the parts dealer and collision repairer
and is committed to developing superior
supply chain.
products which deliver genuine value
for our customers, and in turn, our
Financial outlook
shareholders. We have the people,
In the year ahead, the Company will
knowledge, infrastructure and commitment
incorporate higher data licence costs and
from our partners, to develop and deliver
experience the previously communicated
new products for existing customers as
reduction in General Motors subscriptions
well as future customers.
in North America. Despite anticipated net
Subscription History
11 infomedia.com.au
Annual Report
Commitment to delivering high quality, sought
after products for our expanding customer base.
CEO Report
growth in software subscription volumes,
In last year’s Annual Report I spoke about
the projected strength of the Australian
a Company of strength. Again this year,
dollar during the course of the 2008 year
I am proud of the achievements of our
is likely to have a dampening affect on
management and dedicated staff around
reported profi t.
The recent successful contract renewals in
Europe, North America and Asia Pacifi c,
along with the positive reception of our
new products, provide a solid platform
for growth
in subscription volumes.
Further advances
in EPC technology
for both
the
franchised automotive
dealer and the independent motor trade
will create increased sales momentum
and diversifi cation of the Company’s
customers and product portfolio over the
medium term.
The outlook for Superservice Menus
remains strong, with continuing growth
expected into 2008 and beyond. The
Company continues to expand both
domestically and internationally, with
new automakers and organic growth from
current releases.
the world. Their commitment to delivering
high quality, sought after products for our
expanding customer base is why I am
confi dent that our foundations are solid,
and our prospects are bright when looking
beyond 2008. Your Company continues to
expand its product portfolio and reputation
for truly understanding what our customers
need and translating that into tools that
empower and enrich our customers’ daily
work lives. Put simply, we turn data into
meaningful information.
I look forward to a year ahead that
continues to develop great people and
great products.
Gary Martin
Chief Executive Offi cer
Infomedia staff provide outstanding
service to our customers
The Quality Assurance Team test all products every month ensuring a robust and reliable product
infomedia.com.au 12
Annual Report
People, Community
and the Environment
Prue Elvy
Position: Instructional Designer, Education Services
Qualifi cations: Bachelor of Education, Certifi cate
IV in Workplace Assessment and Training,
Masters in Adult Education (in progress)
Length of service: 5 years
“I have had the opportunity to be involved
in the design and development of all the
different training materials and courses
Infomedia’s multi-lingual
that educate
global customers.
My passion is adult learning and training
so I enjoy supporting our trainers globally
to ensure an effective, professional and
consistent approach to training. I have
a strong user focus and in my design I
highlight the simplicity and consistency
of Infomedia products through the 3-step
model (identify a vehicle, select parts/
service, fi nalise order/quote). I also like to
promote the training department internally
to ensure all employees are aware of what
materials are available to support them in
their roles.“
13 infomedia.com.au
Community
Infomedia recognises that it is our
responsibility as good corporate citizens
to help strengthen the societies in which
we live and work. We also understand that
employees are attracted to companies who
acknowledge this responsibility and allow
them the opportunity to give something
back to the community. Hence, this
year we launched our own corporate
volunteering program – an
initiative
that encourages employees to become
involved in their communities, lending
their voluntary support to programs that
enrich the quality of life and opportunities
for society.
Infomedia’s corporate volunteering program
was created as an extension of our existing
program of fi nancial support for community
groups, and we have found that it provides
many more benefi ts over traditional
donations such as cash. These include:
(cid:129) positive visibility within the local
community and enhanced relationships
with community organisations and
stakeholders;
(cid:129) team building and enhanced employee
morale as staff members work together
on volunteering projects; and
(cid:129) staff training via an appreciation of
diversity with improved communication
skills and social awareness.
Specifi cally,
the program encourages
Infomedia employees to volunteer eight
hours of their work time per quarter to
support selected local charities with whom
we have developed close relationships.
Initially, partnerships were created in the
local community. In our North America
offi ce we encouraged staff to generate
their own ideas about which organisations
to partner with.
Australians and businesses are volunteering
more than ever before, with around 70%
of companies in Australia offering paid
volunteer leave.1 Research also shows
that the 35 – 44 age group volunteers
more than any other age group.2 With the
majority of Infomedia’s own staff falling
within this age bracket, we are discovering
that many of our employees are keen to
take part in volunteering programs and
report positive feelings of self worth and
satisfaction after participating. They
have also expressed their gratitude that
the Company encouraged and supported
this activity. As Lara Wasley, Human
Resources Administration Assistant noted
after volunteering for Meals on Wheels, “It
does make you feel happier to know you
work for a company that is prepared to
go that extra mile and give back to the
local community.”
Lara Wasley, HR Administration Assistant
volunteering for Meals on Wheels
Annual Report
It does make you feel happier to know you work for a company that
is prepared to go that extra mile and give back to the local community.
People, Community
and the Environment
We now advise of our corporate
volunteering policy in our recruitment
advertisements and have found that this
has been a contributing factor for many
applicants in applying for a job with
Infomedia. Not only does our corporate
volunteering program engage potential
employees, but it generates a sense of
pride and satisfaction in our workplace
i– helping to increase employee morale
and therefore retention.
Environment
Infomedia’s existing
Supplementing
commitment to the environment, an
environmental strategy, entitled ‘Project
Green’, was also established this year.
in
Encouraging staff to play a part
environmental sustainability, Project Green
creates positive change with responsible
energy management, waste management,
recycling and water conservation.
Staff are reminded and educated about
sustainable offi ce initiatives, for example:
(cid:129) Energy – all equipment is switched off
before leaving the offi ce and lights are
turned off whenever a room is empty.
‘Lights off Planet on’ stickers are affi xed
distributing printed payroll receipts every
two weeks, the receipts are now available
as a downloadable PDF that is accessed
from a secure website. Leave applications
are also sent electronically from the
website rather than via traditional paper
based methods.
This year’s Annual Report also represents
Clinton Ennis
Position: Development Team Leader of Rich
Internet Applications
Qualifi cations: MCP
(Microsoft Certifi ed Professional)
an effort to minimise the environmental
Length of service: 8 years
impact of our business. In line with the
new legislation introduced in May 2007,
Infomedia now only sends a paper copy
of the Annual Report to shareholders who
request one. All other shareholders receive
notifi cation of the Report’s availability
online at the Infomedia website. This
change represents a signifi cantly lower use
of paper and also savings to shareholders
over the traditional method of printing
and posting the Report. Shareholders
is
Infomedia
“The most rewarding part of my career
at
its global business
relationships. I’ve been fortunate enough to
work and meet with end users, customers,
partners and Infomedia staff all over the
world with varying cultures and interesting
personalities. It’s the people I work with
that are the highlight of my daily work.
Infomedia has a great
infrastructure,
allowing my team to keep pushing our
technology implementations further ahead
of IT in the automotive industry. My team
builds Rich Internet Applications, bringing
our fl agship desktop software to the Internet
in a distributed and connected environment
and giving end users a Web 2.0 experience
they expect from technology today.”
infomedia.com.au 14
next to applicable light switches;
can update their preference for how they
(cid:129) Water – water is conserved by reporting
leaks and turning off taps properly;
(cid:129) Recycling – paper, glass and plastic
recycling bins are appropriately labelled
and located around the offi ce.
receive the Annual Report at any time. To
update your preference, visit:
www.computershare.com.au/holderupdate/ifm
1. Volunteering Australia/Australia Cares. Corporate
Volunteering Survey; 2006.
A new online payroll system has also
been introduced this year. Instead of
2. Giving Australia: Research on Philanthropy in
Australia. www.volunteering.com.au
Annual Report
Directors’ Report
YOUR DIRECTORS SUBMIT THEIR REPORT FOR THE YEAR ENDED 30 JUNE 2007.
DIRECTORS
Directors were in offi ce from the beginning of the fi nancial year until the date of this report,
unless otherwise stated. Geoffrey Henderson was a Non-executive Director and Chairman
of the Corporate Governance Committee until his resignation on 28 February 2007. In June
2007, the Board resolved to appoint Frances Hernon to the Audit & Risk Committee and
to subsequently merge that Committee and the Corporate Governance Committee into
the Audit, Risk & Governance Committee. It was also resolved that the Board itself would
re-absorb the Remuneration & Nomination Committee functions. These changes took effect
from 1 July 2007, with the exception of Ms Hernon’s appointment to the Audit & Risk
Committee (as it then was), which took effect on 25 June 2007. Refer to the Corporate
Governance Statement for further details.
The names and details of the Directors of the Company in offi ce during the fi nancial year
and until the date of this Report are:
Names, Qualifi cations, Experience and Special Responsibilities
Richard Graham – Chairman of the Board
Richard Graham has held senior management positions in the American and Australian
computer industry since 1977. Mr Graham co-founded the Company in 1988 and was its
Chairman and Managing Director/CEO from its establishment until he retired as CEO in
December 2004. Since then, Mr Graham has continued as Chairman. Mr Graham was last
re-elected to the Board in October 2005.
Gary Martin – Chief Executive Offi cer
Gary Martin was promoted to the position of Chief Executive Offi cer on 1 January 2005. Mr
Martin has extensive experience in the automotive industry. He has been with Infomedia
since 1998, when he joined the Company as International Sales Manager. Mr Martin was
appointed as General Manager, Electronic Catalogues Division in August 2001. Prior to
joining Infomedia, he had 12 years of experience at automotive dealerships, including as
General Manager, Parts & Accessories of a large multi-franchised dealership group. In his
time with Ford dealers, Mr Martin was awarded the Ford Management Excellence Award in
four consecutive years and participated on various Automaker committees. Mr Martin was
elected to the Board in October 2004.
15 infomedia.com.au
Frances Hernon – Non-executive Director
Frances Hernon was appointed to the Infomedia Board of Directors on 19 June 2000. Ms
Hernon has extensive experience in media, publishing, marketing and technology. She
has held senior editorial positions at News Ltd and Murdoch Magazines and was General
Manager, Harrison Communications, Director of Publicity at Channel Ten, Managing Editor
of the NRMA’s member magazine The Open Road, Manager, Business Communications for
NRMA, and Senior Account Manager, Group IT&T for the Insurance Australia Group (IAG).
Ms Hernon is currently the Corporate Affairs Manager for Nestlé Australia Ltd.
Ms Hernon serves on the Audit, Risk & Governance Committee and also serves the Board
as Lead Non-executive Director for all matters that formerly fell within the ambit of the
Remuneration & Nomination Committee. Ms Hernon was last re-elected to the Board in
October 2006.
Myer Herszberg – Non-executive Director
Myer Herszberg has been a Director of Infomedia since 1992. Mr Herszberg has extensive
consumer electronics experience and was active in bringing home computers to Australia in
the early 1980s, as well as many other leading edge electronic products. He also has extensive
experience in the commercial property market, and is active in a number of community service
organisations. Mr Herszberg currently serves on the Company’s Audit, Risk & Governance
Committee. Mr Herszberg was last re-elected to the Board in October 2005.
Andrew Moffat – Non-executive Director (Chairman of Audit, Risk & Governance Committee)
Andrew Moffat was appointed to the Infomedia Board of Directors on 31 March 2005. Mr
Moffat has more than 20 years of corporate and investment banking experience and is the
sole principal of Cowoso Capital Pty Ltd, a company providing strategic corporate advisory
services. Mr Moffat was a Director of Equity Capital Markets & Advisory for BNP Paribas
Equities (Australia) Limited with principal responsibility for mergers and acquisition advisory
services and a range of equity capital raising mandates including placements, initial public
offerings, rights issues and dividend reinvestment plan underwritings. His corporate banking
experience was gained whilst working in the United Kingdom and Australia with Standard
Chartered Bank Group, National Westminster Banking Group and BNP Paribas. Mr Moffat
was elected to the Board in October 2005.
COMPANY SECRETARY
Nick Georges – General Counsel & Company Secretary
Nick Georges is a qualifi ed lawyer, admitted to the Supreme Courts of Victoria in 1991 and
New South Wales in 1999. Prior to joining Infomedia and becoming its General Counsel
& Company Secretary in 1999, Mr Georges worked in general practice as a solicitor in
Victoria before moving to Sydney to take up an executive role with Altium Limited, where
he obtained extensive experience in the information technology industry.
Annual Report
Directors’ Report
infomedia.com.au 16
Annual Report
Directors’ Report
Interests in the shares and options of the Company and related bodies corporate
As at the date of this report, the interests of the Directors in the shares and options of the Company were:
Infomedia Ltd
Ordinary shares fully paid
Options over ordinary shares
Wiser Equity Pty Limited
Yarragene Pty Limited
Wiser Centre Pty Limited
Richard Graham
Gary Martin
Frances Hernon
Andrew Moffat
100,277,501
23,421,599
1,000,000
926,559
407,590
5,000
-
-
-
-
-
666,667
-
-
Richard Graham is the sole Director and benefi cial shareholder of Wiser Equity Pty Limited. Richard Graham is a Director of
Wiser Centre Pty Limited, trustee for the Wiser Centre Pty Ltd Superannuation Fund. Myer Herszberg is a Director and major
shareholder of Yarragene Pty Limited.
Directorships of other publicly listed entities
During the past four years, Andrew Moffat has been the non-executive Chairman of Pacifi c Star Network Limited. He is also a
non-executive Director of Cash Converters International Ltd and an executive Director of Ausron Limited.
PRINCIPAL ACTIVITIES
Infomedia Ltd is a company limited by shares that is incorporated and domiciled in Australia.
The principal activities during the year of entities within the consolidated entity were:
(cid:129) developer and supplier of Electronic Parts Catalogues and service quoting systems for the automotive industry globally;
(cid:129)
information management, analysis and creation for the domestic automotive and oil industries; and
(cid:129)
the provision of dealer management systems for the automotive industry.
There have been no signifi cant changes in the nature of those activities during the year, with the exception of the sale of the
Company’s Business Systems Division on 1 December 2006, which was the division responsible for the provision of dealer
management systems for the automotive industry.
EMPLOYEES
The Company employed 204 (2006: 230) full time employees as at 30 June 2007.
17 infomedia.com.au
Annual Report
Directors’ Report
DIVIDENDS
Final dividends recommended:
On ordinary shares – fi nal – fully franked
Dividends paid in the year:
On ordinary shares – 2007 interim – fully franked
On ordinary shares – special – fully franked
Cents
$’000
2.10
6,845
1.90
3.50
6,194
11,391
Final for the 2006 year:
On ordinary shares – as recommended in the 2006 report
2.10
6,836
NET TANGIBLE ASSETS PER SECURITY
The Company’s net tangible assets per security are as follows:
Net tangible assets per share at 30 June 2007
Net tangible assets per share at 30 June 2006
REVIEW AND RESULTS OF OPERATIONS
Cents
4.8
7.5
The following table presents sales revenue and profi t after tax after excluding non-recurring signifi cant items:
Sales revenue – Catalogue and Publishing
Sales revenue – Business Systems (sold 1 December 2006)
Consolidated sales revenue
Reported profi t after tax
Adjustments:
Sale and leaseback transaction after tax
Profi t after tax excluding sale and leaseback transaction and
signifi cant items
CONSOLIDATED
2007
$’000
52,990
1,576
54,566
2006
$’000
51,635
3,942
55,577
15,294
18,146
-
15,294
(1,616)
16,530
The Company is pleased to report net profi t after tax of $15,294,000 for the 2007 fi nancial year, which is within the guidance
previously provided to the market in December 2006.
Electronic Parts Catalogue subscription numbers grew by 11% to 53,165 and Superservice Menus subscription numbers grew
by 56% to 2,614 over the previous corresponding period.
Electronic Parts Catalogue subscription growth was driven primarily through the successful worldwide launch into Kia markets,
coupled with organic growth within the existing portfolio. Superservice Menu subscription growth was driven primarily across
European markets, with particular emphasis on Daihatsu and Hyundai.
infomedia.com.au 18
Annual Report
Directors’ Report
REVIEW AND RESULTS OF OPERATIONS (CONTINUED)
Catalogue and Publishing sales revenue increased by 3% to $52,990,000 over the equivalent prior period. This growth was
impaired as a result of the rising strength of the Australian dollar throughout the year. Consolidated sales revenue of $54,566,000
only included fi ve months of the Business Systems Division compared to the full 12 months of the comparative period following
the sale of the division. The division was sold on 1 December 2006 for gross proceeds of $1,500,000. The absence of the
Business Systems Division in the second half had little impact on reported profi ts, as this business was operating on a near
breakeven basis.
Cash fl ows from operations remain strong, with $14,044,000 in cash generation. Total dividend payments to shareholders over
the 2007 fi nancial year amounted to $24,421,000. Notwithstanding these returns, the balance sheet remains in a strong position,
with $15,690,000 cash on hand at 30 June 2007.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
There has been no signifi cant change in the state of affairs of the Company since the last Directors’ Report, with the exception
of the sale of the Company’s Business Systems Division on 1 December 2006, which was the division responsible for the
provision of dealer management systems for the automotive industry.
SIGNIFICANT EVENTS AFTER THE BALANCE DATE
There has been no matter or circumstance that has arisen since the end of the fi nancial year that has signifi cantly affected the
operations of the Company, the results of those operations, or the state of affairs of the Company.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
In the year ahead, the Company will incorporate higher data licence costs and experience the previously communicated
reduction in General Motors subscriptions in North America. Despite anticipated net growth in software subscription volumes,
the projected strength of the Australian dollar during the course of the 2008 year is likely to have a dampening affect on
reported profi t.
The recent successful contract renewals in Europe, North America and Asia Pacifi c, along with the positive reception of our
new products, provide a solid platform for growth in subscription volumes. Further advances in EPC technology for both the
franchised automotive dealer and the independent motor trade will create increased sales momentum and diversifi cation of the
Company’s customers and product portfolio over the medium term.
The outlook for Superservice Menus remains strong, with continuing growth expected into 2008 and beyond. The Company
continues to expand both domestically and internationally, with new automakers and organic growth from current releases.
ENVIRONMENTAL REGULATION AND PERFORMANCE
The Company is not subject to any particular or signifi cant environmental regulation under a law of the Commonwealth of
Australia or of a State or Territory.
SHARE OPTIONS
Unissued shares
At the date of this report, there were 1,300,001 unissued ordinary shares under options. Refer to Note 24 of the fi nancial
statements for further details of the options outstanding.
19 infomedia.com.au
Annual Report
Directors’ Report
Shares issued as a result of the exercise of options
During the fi nancial year, executives have exercised options to acquire 499,999 (2006: nil) fully paid ordinary shares in Infomedia
Ltd at a weighted average price of $0.50. Since the end of the fi nancial year, there have been no further options exercised.
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
During the year, the Company paid a premium in relation to insuring Directors and other offi cers against liability incurred in
their capacity as a Director or offi cer of the Company. The insurance contract specifi cally prohibits the disclosure of the nature
of the policy and amount of premium paid.
REMUNERATION REPORT
This report outlines the remuneration arrangements in place for Directors and executives of the Company.
Infomedia Ltd has adopted the option available under the Corporation Regulations 2M.6.04 (as amended by the Corporation
Amendments Regulation 2006 (No. 4)) which permits listed companies to transfer the remuneration disclosures required under
AASB124 para Aus 25.4 – Aus 25.7.2 out of the Financial Report and into the Remuneration Report. The transferred AASB124
disclosures are subject to audit.
Compensation philosophy (audited)
The performance of the Company depends upon the quality of its Directors and executives. To prosper, the Company must
attract, motivate and retain highly skilled Directors and executives. To this end, the Company embodies the following principles
in its compensation framework:
(cid:129) provide competitive rewards to attract high calibre executives;
(cid:129)
link executive rewards to shareholder value;
(cid:129) establish appropriate performance hurdles in relation to variable executive compensation.
Remuneration Committee
The Remuneration & Nomination Committee (Remuneration Committee) of the Board of Directors is responsible for
recommending to the Board the Company’s remuneration and compensation policy arrangements for all Key Management
Personnel. The Remuneration Committee assesses the appropriateness of the nature and amount of these emoluments on a
periodic basis by reference to relevant employment market conditions with the overall objective of ensuring maximum
stakeholder benefi t from the retention of a high quality Board and executive team.
Compensation structure
In accordance with best practice corporate governance recommendations, the structure of non-executive Director and senior
executive compensation is separate and distinct.
Non-executive Director compensation (audited)
Objective
The Board seeks to set aggregate compensation at a level which provides the Company with the ability to attract and retain
Directors of appropriate calibre, whilst incurring a cost which is acceptable to shareholders.
infomedia.com.au 20
Annual Report
Directors’ Report
REMUNERATION REPORT (CONTINUED)
Structure
The Constitution and the Australian Securities Exchange (ASX) Listing Rules specify that the aggregate compensation of non-
executive Directors shall be determined from time to time by a general meeting. An amount not exceeding the amount determined
is then available between the Directors as appropriate (for the year ended 30 June 2007, non-executive Directors’ compensation
totalled $350,136 (2006: $311,489)). The latest determination was at the Annual General Meeting held on 30 October 2002,
when shareholders approved a maximum aggregate compensation of $450,000 per year.
The Board has historically considered the advice from external consultants as well as the fees paid to non-executive Directors of
comparable companies when undertaking a review process.
Senior executive and executive director compensation (audited)
Objective
The Company aims to reward executives with a level and mix of compensation commensurate with their position and responsibilities
within the Company and so as to:
(cid:129) reward executives for Company and individual performance against targets set by reference to appropriate benchmarks;
(cid:129) align the interests of executives with those of shareholders;
(cid:129) link reward with the strategic goals and performance of the Company; and
(cid:129) ensure total compensation is competitive by market standards.
Structure
In determining the level and make-up of executive compensation, the Remuneration Committee engages an external consultant
from time to time to provide independent advice in the form of a written report detailing market levels of compensation for
comparable executive roles.
Compensation consists of the following key elements:
– Fixed Compensation
– Variable Compensation – Short Term Incentive (STI); and
– Variable Compensation – Long Term Incentive (LTI).
The actual proportion of fi xed compensation and variable compensation (potential short term and long term incentives) is
established for Key Management Personnel (excluding the CEO and non-executive Directors) by the CEO in conjunction with
the Remuneration Committee, and in the case of the CEO, by the Chairman of the Board in conjunction with the Remuneration
Committee. Other executive salaries are determined by the CEO with reference to market conditions.
Fixed compensation
Objective
The level of fi xed compensation is set so as to provide a base level of compensation which is both appropriate to the position
and competitive in the market. Fixed compensation is reviewed periodically by the CEO in conjunction with the Remuneration
21 infomedia.com.au
Annual Report
Directors’ Report
Committee for the Key Management Personnel (excluding the CEO and non-executive Directors), and in the case of the CEO,
by the Chairman of the Board in conjunction with the Remuneration Committee. All other executive positions are reviewed
periodically by the CEO. As noted above, the Committee has access to external advice independent of management.
Structure
Executives are given the opportunity to receive their fi xed (primary) compensation in a variety of forms including cash or other
designated employee expenditure such as motor vehicles. It is intended that the manner of payment chosen will be optimal for the
recipient without creating undue cost for the Company.
Variable compensation – Short Term Incentive (STI) (audited)
Objective
The objective of short term compensation is to link the achievement of both individual performance and Company performance
with the compensation received by the executive.
Structure
The structure of short term compensation is a cash bonus dependent upon a combination of individual performance objectives and
Company objectives being met. This refl ects the Company wide practice of ‘Performance Planning and Review’ (PPR) procedures.
Individual performance objectives centre on key focus areas. Company objectives include achieving budgetary targets that are set
at the commencement of the fi nancial year (adjusted where necessary for currency fl uctuations).
These performance conditions were chosen, in the case of individual performance objectives, to promote and maintain the
individual’s focus on their own contribution to the Company’s strategic objectives through individual achievement in key result
areas (KRAs) which include, for example, ‘leadership’, ‘decision making’, ‘results’ and ‘risk management’. In the case of Company
objectives, budgetary performance conditions were chosen to promote and maintain a collaborative, Company wide focus on the
achievement of those targets.
In assessing whether an individual performance condition has been satisfi ed, pre-agreed key performance indicators (KPIs) are
used. In assessing whether Company objectives have been satisfi ed, Board level pre-determined budgetary targets are used. These
methods have been chosen to create clear and measurable performance targets.
Variable compensation – Long Term Incentive (LTI) (audited)
Objective
The objective of the LTI plan is to reward executives in a manner which aligns this element of compensation with the creation of
shareholder wealth. As LTI grants are made to executives who are able to infl uence the generation of shareholder wealth and thus
have a direct impact on the Company’s performance against the relevant long term performance hurdle.
Structure
The structure of long term compensation is in the form of share options pursuant to the Employee Option Plan and Employee
Share Plan. Performance hurdles have been introduced for all share options issued after 31 December 2004 and are determined
upon grant of those share options. These hurdles typically relate to the Company’s share price reaching or exceeding a particular
level. These methods were chosen to create clear and measurable performance expectations.
infomedia.com.au 22
Annual Report
Directors’ Report
REMUNERATION REPORT (CONTINUED)
Specifi ed Directors and fi ve highest remunerated specifi ed executives for the year ended 30 June 2007 and 30 June 2006
(audited)
Short term
Post
employment
Share based payments
Long term
Total
Percentage
performance
related
Superannuation
Options
Employee
share plan
Other
$
%
2007 Financial Year
Salary
and Fees
Bonus
Directors
Richard Graham
115,000
-
Gary Martin
280,000
83,200
Non
monetary
benefi ts
-
-
-
-
-
-
-
-
-
-
24,746
38,000
25,641
25,000
23,000
15,258
-
12,434
-
-
56,300
56,250
56,250
37,427
314,276
190,742
182,692
167,215
165,000
118,019
280,000
42,000
42,000
42,000
42,000
305,523
190,742
170,290
153,558
170,186
-
63,000
-
-
-
-
-
38,000
12,500
14,000
-
1,556,318
127,500
-
-
-
-
-
-
14,537
-
-
-
9,589
24,126
10,350
25,200
5,067
5,062
5,062
3,368
28,285
17,220
-
14,850
14,850
10,350
24,445
3,780
3,780
3,780
3,780
27,497
17,167
15,326
13,820
-
1,621,152
219,587
27,692
129,314
Myer Herszberg
Frances Hernon
Andrew Moffat
Geoffrey Henderson
Executives
Andrew Pattinson
Peter Adams
Mark Kujacznski
Michael Roach
Nick Georges
2006 Financial Year
Directors
Richard Graham
Gary Martin
Myer Herszberg
Geoffrey Henderson
Frances Hernon
Andrew Moffat
Executives
Andrew Pattinson
Peter Adams
Nick Georges
Michael Roach
Mark Kujacznski
-
48,846
-
-
-
-
-
17,961
-
7,332
5,700
79,839
-
51,232
-
-
-
-
-
17,742
13,050
6,286
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,000
1,000
1,000
1,000
-
-
125,350
3,267
440,513
-
30%
-
-
-
-
61,367
61,312
61,312
40,795
5,238
2,225
387,803
266,148
-
220,767
2,787
1,925
217,184
210,475
15,442
2,093,026
-
3,267
-
-
-
-
5,092
2,225
1,987
2,559
-
128,369
421,944
45,780
45,780
45,780
45,780
353,649
266,876
214,153
191,223
179,775
-
-
-
-
6%
21%
12%
15%
14%
-
27%
-
-
-
-
-
21%
12%
11%
-
123,725
88,310
4,000
15,130
1,939,109
Directors and Executives also represent Key Management Personnel as defi ned by AASB124.
23 infomedia.com.au
Annual Report
Directors’ Report
Contract for services (audited)
The table and notes below summarise current executive employment contracts with the Company as at the date of this Report:
Gary Martin
Nick Georges
Peter Adams
Michael Roach
Mark Kujacznski
Commencement date
per latest contract
1 January 2005
1 January 2005
1 January 2005
1 January 2005
22 August 2005
Duration
3 years
3 years
3 years
3 years
3 years
Notice period
– Company
Notice period
– executive
6 months*
6 months*
6 months*
3 months
3 months
6 months
6 months
6 months
3 months
3 months
The Company may terminate each of the contracts at any time without notice if serious misconduct has occurred. Options that
have not yet vested upon termination will be forfeited.
* In the event of redundancy, in addition to six months notice, the Company will provide the individual with a severance payment
equivalent to three weeks’ base salary for each completed year of continuous service with the Company provided however, that
the minimum severance payment will be 26 weeks’ base salary and the maximum severance payment will not exceed 52 weeks’
base salary.
Compensation options: Granted during the year (audited)
There were no options granted during the year.
Shares issued on exercise of compensation options (Consolidated) (audited)
30 June 2007
Directors
Gary Martin
Executives
Peter Adams
Shares issued
Number
333,333
166,666
Paid per share
Unpaid per share
$
0.50
0.50
$
-
-
No options were exercised during the prior year by Key Management Personnel.
infomedia.com.au 24
Annual Report
Directors’ Report
REMUNERATION REPORT (CONTINUED)
Option holdings of Key Management Personnel (Consolidated) (audited)
30 June 2007
Balance at
beginning of
period
1 July 2006
Directors
Gary Martin
1,000,000
Granted as
compensation
Options
exercised
Net change
other
Balance at
end of period
Vested at 30 June 2007
30 June 2007
Total
Not
exercisable
Exercisable
-
-
-
-
-
(333,333)
(166,666)
-
-
(499,999)
-
-
-
-
-
666,667
666,667
333,334
333,333
83,334
250,000
200,000
83,334
83,334
250,000
166,667
200,000
133,334
-
83,333
66,666
1,200,001
1,200,001
716,669
483,332
Granted as
compensation
Options
exercised
Net change
other
Balance at
end of period
Vested at 30 June 2006
30 June 2006
Total
Not
exercisable
Exercisable
250,000
250,000
200,000
1,700,000
Balance at
beginning of
period
1 July 2005
-
-
-
-
-
1,000,000
250,000
250,000
200,000
1,700,000
-
-
-
-
-
-
-
-
-
-
1,000,000
1,000,000
666,667
333,333
250,000
250,000
200,000
250,000
250,000
200,000
166,667
166,667
200,000
83,333
83,333
-
1,700,000
1,700,000
1,200,001
499,999
Executives
Peter Adams
Nick Georges
Michael Roach
30 June 2006
Directors
Gary Martin
Executives
Peter Adams
Nick Georges
Michael Roach
DIRECTORS’ MEETINGS
The number of meetings of Directors (including meetings of committees of Directors) held during the year and the number of
meetings attended by each Director were as follows:
Directors’ meetings
Committee meetings
Audit & Risk
Corporate Governance
Number of meetings held:
Number of meetings attended:
Richard Graham
Gary Martin
Geoffrey Henderson
Myer Herszberg
Frances Hernon
Andrew Moffat
13
13
13
7
12
12
13
5
-
-
4
4
1
5
2
-
-
2
1
2
-
Remuneration &
Nomination
4
-
-
-
4
4
4
25 infomedia.com.au
Annual Report
Directors’ Report
In June 2007, the Board resolved to appoint Ms Hernon to the Audit & Risk Committee and to subsequently merge that Committee
and the Corporate Governance Committee into the Audit, Risk & Governance Committee. It was also resolved that the Board itself
would re-absorb the Remuneration & Nomination Committee functions. These changes took effect from 1 July 2007, with the
exception of Ms Hernon’s appointment to the Audit & Risk Committee (as it then was), which took effect on 25 June 2007.
ROUNDING
The amounts contained in this Report and in the fi nancial report have been rounded to the nearest $1,000 (where rounding is
applicable) under the option available to the Company under ASIC Class Order 98/0100. The Company is an entity to which the
Class Order applies.
CORPORATE GOVERNANCE
In recognising the need for high standards of corporate behaviour and accountability, the Directors of Infomedia Ltd support
and have adhered to the principles of good corporate governance. The Company’s corporate governance statement is after the
independent audit report.
AUDITOR INDEPENDENCE AND NON-AUDIT SERVICES
The Directors received an auditor’s independence declaration from the auditor of the Company (refer page 26).
NON-AUDIT SERVICES
Ernst & Young did not provide any non-audit services during the fi nancial year ended 30 June 2007.
Signed in accordance with a resolution of the Directors.
Richard David Graham
Chairman
Sydney, 22 August 2007
infomedia.com.au 26
Annual Report
Independence
Declaration
Auditor’s Independence Declaration to the Directors of Infomedia Ltd
In relation to our audit of the fi nancial report of Infomedia Ltd for the fi nancial year ended 30 June 2007, to the best of my
knowledge and belief, there have been no contraventions of the auditor independence requirements of the Corporations Act
2001 or any applicable code of professional conduct.
Ernst & Young
Ernst & Young
Garry Wayling
Partner
Sydney, 22 August 2007
J K Haydon
Partner
Sydney
Date: 23 August 2006
Liability limited by a scheme approved
under Professional Standards Legislation
27 infomedia.com.au
Annual Report
Income
Statement
YEAR ENDED 30 June 2007
Notes
CONSOLIDATED
INFOMEDIA LTD
Sales revenue
Rental revenue
Finance revenue
Revenue
Cost of sales
Gross profi t
Other income
Net profi t/(loss) on sale of business
Employee benefi ts expense
Depreciation and amortisation
Finance costs
Operating lease rental
Other expenses
Profi t before income tax
Income tax expense
Profi t after income tax
Basic earnings per share (cents per share)
Diluted earnings per share (cents per share)
Dividends per share – ordinary (cents per share)
Dividends per share – special (cents per share)
2007
$’000
42,967
-
778
43,745
(11,106)
32,639
-
(76)
(7,017)
(3,016)
(134)
(533)
(1,868)
19,995
(5,498)
14,497
2006
$’000
46,112
-
1,164
47,276
(13,436)
33,840
677
-
(6,851)
(2,689)
(197)
(912)
(5,302)
18,566
(4,866)
13,700
2007
$’000
54,566
-
791
55,357
(17,448)
37,909
-
15
(8,374)
(3,492)
(134)
(1,072)
(4,119)
20,733
(5,439)
15,294
4.70
4.68
4.00
-
3(i)
3(ii)
22
3(iii)
3(iv)
4
5
5
6
6
2006
$’000
55,577
646
268
56,491
(17,472)
39,019
2,892
-
(8,009)
(3,355)
(197)
(534)
(5,002)
24,814
(6,668)
18,146
5.58
5.57
4.00
7.00
infomedia.com.au 28
Annual Report
Balance Sheet
AT 30 June 2007
Notes
CONSOLIDATED
INFOMEDIA LTD
21(b)
7
8
31
9
10
12
13
4
15
16
17
18
19
4
20
20
2007
$’000
15,690
6,944
52
432
-
2006
$’000
26,021
6,751
84
544
229
2007
$’000
13,544
3,818
52
297
-
2006
$’000
25,089
4,409
71
448
229
23,118
33,629
17,711
30,246
-
335
2,817
17,139
1,443
21,734
44,852
2,482
-
2,284
2,272
506
7,544
1,706
2,700
4,406
11,950
32,902
17,738
978
14,186
32,902
-
804
4,066
17,375
1,790
24,035
57,664
3,974
500
2,711
3,451
816
11,452
2,339
2,062
4,401
15,853
41,811
17,488
1,010
23,313
41,811
1,623
583
2,222
13,465
1,250
19,143
36,854
1,752
-
1,612
2,228
254
5,846
1,568
2,353
3,921
9,767
27,087
17,738
1,023
8,326
27,087
451
1,052
3,402
12,754
1,592
19,251
49,497
2,988
500
2,001
3,126
405
9,020
2,187
1,576
3,763
12,783
36,714
17,488
976
18,250
36,714
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Inventories
Prepayments
Derivatives
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Intercompany
Other fi nancial assets
Property, plant and equipment
Intangible assets and goodwill
Deferred tax assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Interest bearing loans and borrowings
Provisions
Income tax payable
Deferred revenue
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Provisions
Deferred tax liabilities
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Retained profi ts
TOTAL EQUITY
29 infomedia.com.au
Annual Report
Cash Flow
Statement
YEAR ENDED 30 June 2007
Notes
CONSOLIDATED
INFOMEDIA LTD
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Payments to suppliers and employees
Interest received
Borrowing costs
Income tax paid
NET CASH FLOWS FROM OPERATING ACTIVITIES
21 (a)
22
3(vi)
3(vi)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property, plant and equipment
Proceeds from sale of business
Proceeds from sale of property, plant and equipment including
property held for resale
Non refundable payment for capital works
Purchase of intellectual property
Purchase of shares in controlled entity
NET CASH FLOWS FROM/(USED IN) INVESTING
ACTIVITIES
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from exercise of share options
Proceeds from borrowings
Repayment of borrowings
Repayment of loan from controlled entity
2007
$’000
54,284
(35,448)
791
(3)
(5,580)
14,044
(873)
1,169
-
-
-
-
2006
$’000
54,522
(31,036)
268
(197)
(4,528)
19,029
(1,625)
-
23,000
(500)
(2,096)
-
2007
$’000
43,535
(25,438)
778
(3)
(5,239)
13,633
(692)
185
-
-
-
-
2006
$’000
46,229
(23,556)
1,164
(197)
(4,528)
19,112
(1,121)
-
1,750
-
(2,096)
(1)
296
18,779
(507)
(1,468)
250
-
(500)
-
-
8,000
(7,500)
-
250
-
(500)
-
-
8,000
(7,500)
21,250
Dividends paid on ordinary shares
6
(24,421)
(23,108)
(24,421)
(23,108)
NET CASH FLOWS FROM/(USED IN) FINANCING
ACTIVITIES
(24,671)
(22,608)
(24,671)
(1,358)
NET INCREASE/(DECREASE) IN CASH HELD
(10,331)
15,200
(11,545)
16,286
Add opening cash brought forward
26,021
10,821
25,089
8,803
CLOSING CASH CARRIED FORWARD
21 (b)
15,690
26,021
13,544
25,089
infomedia.com.au 30
Annual Report
Statement of
Changes in Equity
YEAR ENDED 30 June 2007
CONSOLIDATED
Contributed equity
Retained earnings
Other reserves
Total
At 1 July 2006
Currency translation differences
Profi t for the year
Cost of share based payments
Exercise of options
Equity dividends
At 30 June 2007
$’000
17,488
-
-
-
250
-
17,738
$’000
23,313
-
15,294
-
-
(24,421)
14,186
$’000
1,010
(79)
-
47
-
-
978
$’000
41,811
(79)
15,294
47
250
(24,421)
32,902
YEAR ENDED 30 June 2006
CONSOLIDATED
Contributed equity
Retained earnings
Other reserves
Total
At 1 July 2005
Currency translation differences
Profi t for the year
Cost of share based payments
Equity dividends
At 30 June 2006
YEAR ENDED 30 June 2007
At 1 July 2006
Profi t for the year
Exerercise of options
Cost of share based payments
Equity dividends
At 30 June 2007
YEAR ENDED 30 June 2006
At 1 July 2005
Profi t for the year
Cost of share based payments
Equity dividends
At 30 June 2006
31 infomedia.com.au
$’000
17,488
-
-
-
-
17,488
$’000
28,275
-
18,146
-
(23,108)
23,313
$’000
706
53
-
251
-
1,010
Contributed equity
Retained earnings
Other reserves
INFOMEDIA LTD
$’000
17,488
-
250
-
-
17,738
$’000
18,250
14,497
-
-
(24,421)
8,326
$’000
976
-
-
47
-
1,023
$’000
46,469
53
18,146
251
(23,108)
41,811
Total
$’000
36,714
14,497
250
47
(24,421)
27,087
Contributed equity
Retained earnings
Other reserves
Total
INFOMEDIA LTD
$’000
17,488
-
-
-
17,488
$’000
27,658
13,700
-
(23,108)
18,250
$’000
725
-
251
-
976
$’000
45,871
13,700
251
(23,108)
36,714
Annual Report
Notes to the
Financial Statements
30 June 2007
1. CORPORATE INFORMATION
The fi nancial report of Infomedia Ltd for the year ended 30 June 2007 was authorised for issue in accordance with a resolution of
the Directors on 22 August 2007.
Infomedia Ltd is a company limited by shares incorporated in Australia whose shares are publicly traded on the Australian
Securities Exchange.
The nature of the operations and principal activities of the Company are described in the Directors’ Report.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of preparation
The fi nancial report is a general-purpose fi nancial report, which has been prepared in accordance with the requirements of the
Corporations Act 2001 and Australian Accounting Standards. The fi nancial report has also been prepared on a historical cost basis,
except for derivative fi nancial instruments that have been measured at fair value.
(b) Statement of compliance
The fi nancial report complies with Australian Accounting Standards, which include Australian equivalents to International Financial
Reporting Standards (AIFRS). Compliance with AIFRS ensures that the fi nancial report, comprising the fi nancial statements and
notes thereto, complies with International Financial Reporting Standards (IFRS).
Certain Australian Accounting Standards and UIG interpretations have recently been issued or amended but are not yet effective.
These Standards have not been adopted by the Company for the year ended 30 June 2007. The Directors have yet to fi nalise their
assessment of the impact of the new or amended standards (to the extent relevant to the Company).
(c) Basis of consolidation
The consolidated fi nancial statements comprise the fi nancial statements of Infomedia Ltd and its subsidiaries (the Company).
The fi nancial statements of subsidiaries are prepared for the same reporting period as for the parent company, using consistent
accounting policies. Adjustments are made to bring into line any dissimilar accounting policies that may exist. All intercompany
balances and transactions, including unrealised profi ts arising from intra-group transactions, have been eliminated in full.
Unrealised losses are eliminated unless costs cannot be recovered. Subsidiaries are consolidated from the date on which control
is transferred to the Company and cease to be consolidated from the date on which control is transferred out of the Company.
Where there is loss of control of a subsidiary, the consolidated fi nancial statements include the results for the part of the reporting
period during which Infomedia Ltd has control.
(d) Signifi cant accounting judgements, estimates and assumptions
The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events.
infomedia.com.au 32
Annual Report
Notes to the
Financial Statements
30 June 2007
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(d) Signifi cant accounting judgements, estimates and assumptions (continued)
The key estimates and assumptions that have a signifi cant risk of causing a material adjustment to the carrying amounts of certain
assets and liabilities within the next annual reporting period are:
Impairment of goodwill
The Company determines whether goodwill is impaired at least on an annual basis. This requires an estimation of the recoverable
amount of the cash generating units to which the goodwill and intangibles with indefi nite useful lives are allocated. The
assumptions used in this estimation of recoverable amount and the carrying amount of goodwill and intangibles with indefi nite
useful lives are discussed in Note 14.
Share based payment transactions
The Company measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by an external valuer using a binomial model, using
the assumptions detailed in Note 24.
(e) Foreign currencies
Translation of foreign currency transactions
Transactions in foreign currencies of the Company are converted to local currency at the rate of exchange ruling at the date of
the transaction.
Amounts payable to and by the Company that are outstanding at the balance date and are denominated in foreign currencies have
been converted to local currency using rates of exchange ruling at the end of the reporting period.
All currency exchange differences in the consolidated fi nancial report are taken to the income statement.
Derivative fi nancial instruments
The Company uses derivative fi nancial instruments such as foreign currency contracts to hedge its risks associated with foreign
currency fl uctuations. Such derivative fi nancial instruments are stated at fair value. The fair value of forward exchange contracts
is calculated by reference to current forward exchange rates for contracts with similar maturity profi les.
For derivatives that do not qualify for hedge accounting, any gains or losses arising from changes in fair value are taken directly
to net profi t or loss for the reporting period.
Translation of fi nancial reports of overseas operations
Both the functional and the presentation currency of Infomedia Ltd and its Australian subsidiaries is Australian dollars ($A).
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate as
at the date of the initial transaction.
33 infomedia.com.au
Annual Report
Notes to the
Financial Statements
30 June 2007
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(e) Foreign currencies (continued)
The functional currencies of the overseas subsidiaries are as follows:
IFM Europe Ltd
IFM Germany GmbH
Euros
Euros
IFM North America Inc
United States Dollars (USD)
As at the reporting date, the assets and liabilities of these overseas subsidiaries are translated into the presentation currency of
Infomedia Ltd at the rate of exchange ruling at the balance sheet date and the income statements are translated at the weighted
average exchange rates for the period.
The exchange differences arising on the retranslation are taken directly to a separate component of equity.
(f) Cash and cash equivalents
Cash on hand and in banks and short term deposits are stated at nominal values.
For the purposes of the cash fl ow statement, cash includes cash on hand and in banks, and money market investments readily
convertible to cash within three months, net of outstanding bank overdrafts.
(g) Trade and other receivables
Trade receivables, which generally have 30–60 day terms, are recognised and carried at original invoice amount less an allowance
for any uncollectible amounts.
An allowance for doubtful debts is made when there is objective evidence that the Company will not be able to collect the debts.
Bad debts are written off when identifi ed.
(h) Investments and other fi nancial assets
Financial assets in the scope of AASB139 Financial Instruments: Recognition and Measurement are classifi ed as either fi nancial
assets at fair value through profi t or loss, loans and receivables, held-to-maturity investments, or available-for-sale investments, as
appropriate. For the Company the relevant category is listed below:
Loans and receivables
Loans and receivables are non-derivative fi nancial assets with fi xed or determinable payments that are not quoted in an active
market. Such assets are carried at amortised cost using the effective interest method. Gains and losses are recognised in profi t or
loss when the loans and receivables are derecognised or impaired, as well as through the amortisation process.
Investments in Subsidiaries
Investments in subsidiaries are recorded at cost.
infomedia.com.au 34
Annual Report
Notes to the
Financial Statements
30 June 2007
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(i) Inventories
Inventories are valued at the lower of cost and net realisable value.
Costs incurred in bringing each product to its present location and condition are accounted for as follows:
(cid:129) Raw materials – purchase cost on a fi rst-in-fi rst-out basis.
(j) Goodwill
Goodwill acquired in a business combination is initially measured at cost, being the excess of the cost of the business combination
over the Company’s interest in the net fair value of the acquiree’s identifi able assets, liabilities and contingent liabilities.
Following initial recognition, goodwill is measured at cost less any accumulated impairment losses.
Goodwill is reviewed for impairment annually or more frequently if events or changes in circumstances indicate that the carrying
value may be impaired.
For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each
of the Company’s cash generating units, or groups of cash generating units, that are expected to benefi t from the synergies of the
combination, irrespective of whether other assets or liabilities of the Company are assigned to those units or groups of units.
Each unit or group of units to which the goodwill is so allocated:
(cid:129) represents the lowest level within the Company at which the goodwill is monitored for internal management purposes; and
(cid:129) is not larger than a segment based on either the Company’s primary or the Company’s secondary reporting format determined
in accordance with AASB114 Segment Reporting.
Impairment is determined by assessing the recoverable amount of the cash generating unit (group of cash generating units) to
which the goodwill relates. When the recoverable amount of the cash generating unit (group of cash generating units) is less
than the carrying amount, an impairment loss is recognised. When goodwill forms part of a cash generating unit (group of
cash generating units) and an operation within that unit is disposed of, the goodwill associated with the operation disposed of
is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill
disposed of in this manner is measured based on the relative values of the operation disposed of and the portion of the cash
generating unit retained.
Impairment losses recognised for goodwill are not subsequently reversed.
(k) Intangible assets
Intangible assets acquired separately or in a business combination are initially measured at cost. The cost of an intangible asset
acquired in a business combination is its fair value as at the date of acquisition. Following initial recognition, intangible assets
35 infomedia.com.au
Annual Report
Notes to the
Financial Statements
30 June 2007
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(k) Intangible assets (continued)
are carried at cost less any accumulated amortisation and any accumulated impairment losses. Internally generated intangible
assets, excluding capitalised development costs, are not capitalised and expenditure is charged against profi ts in the year in which
the expenditure is incurred.
The useful lives of intangible assets are assessed to be either fi nite or indefi nite. Intangible assets with fi nite lives are amortised
over the useful life and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The
amortisation period and the amortisation method for an intangible asset with a fi nite useful life is reviewed at least at each
fi nancial year-end. Changes in the expected useful life or the expected pattern of consumption of future economic benefi ts
embodied in the asset are accounted for by changing the amortisation period or method, as appropriate, which is a change in
accounting estimate. The amortisation expense on intangible assets with fi nite lives is recognised in profi t or loss in the expense
category consistent with the function of the intangible asset.
Intangible assets with indefi nite useful lives are tested for impairment annually either individually or at the cash generating unit
level. Such intangibles are not amortised. The useful life of an intangible asset with an indefi nite life is reviewed each reporting
period to determine whether indefi nite life assessment continues to be supportable. If not, the change in the useful life assessment
from indefi nite to fi nite is accounted for as a change in an accounting estimate and is thus accounted for on a prospective basis.
Research and development costs
Research costs are expensed as incurred. An intangible asset arising from development expenditure on an internal project is
recognised only when the Company can demonstrate the technical feasibility of completing the intangible asset so that it will
be available for use or sale, its intention to complete and its ability to use or sell the asset, how the asset will generate future
economic benefi ts, the availability of resources to complete the development and the ability to measure reliably the expenditure
attributable to the intangible asset during its development. Following the initial recognition of the development expenditure, the
cost model is applied, requiring the asset to be carried at cost less any accumulated amortisation and accumulated impairment
losses. Any expenditure so capitalised is amortised over the period of expected benefi ts from the related project commencing
from the commercial release of the project.
The carrying value of an intangible asset arising from development expenditure is tested for impairment annually when the asset
is not yet available for use, or more frequently when an indication of impairment arises during the reporting period.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds
and the carrying amount of the asset and are recognised in profi t or loss when the asset is derecognised.
(l) Impairment of assets
The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any such
infomedia.com.au 36
Annual Report
Notes to the
Financial Statements
30 June 2007
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(l) Impairment of assets (continued)
indication exists, or when annual impairment testing for an asset is required, the Company makes an estimate of the asset’s recoverable
amount. An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use and is determined for an
individual asset, unless the asset does not generate cash infl ows that are largely independent of those from other assets or groups of
assets and the asset’s value in use cannot be estimated to be close to its fair value. In such cases the asset is tested for impairment as part
of the cash generating unit to which it belongs. When the carrying amount of an asset or cash generating unit exceeds its recoverable
amount, the asset or cash generating unit is considered impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash fl ows are discounted to their present value using a pre-tax discount rate that
refl ects current market assessments of the time value of money and the risks specifi c to the asset. Impairment losses relating to
continuing operations are recognised in those expense categories consistent with the function of the impaired asset unless the
asset is carried at revalued amount (in which case the impairment loss is treated as a revaluation decrease).
An assessment is also made at each reporting date as to whether there is any indication that previously recognised impairment
losses may no longer exist or may have decreased. If such indication exists, the recoverable amount is estimated. A previously
recognised impairment loss is reversed (with the exception of goodwill) only if there has been a change in the estimates used to
determine the asset’s recoverable amount since the last impairment loss was recognised. If that is the case, the carrying amount of
the asset is increased to its recoverable amount. That increased amount cannot exceed the carrying amount that would have been
determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in
profi t or loss unless the asset is carried at revalued amount, in which case the reversal is treated as a revaluation increase. After such
a reversal, the depreciation charge is adjusted in future periods to allocate the asset’s revised carrying amount, less any residual
value, on a systematic basis over its remaining useful life.
(m) Property, plant and equipment
Property, plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses. Such cost
includes the cost of replacing parts that are eligible for capitalisation when the cost of replacing the parts is incurred. Similarly,
when each major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement
only if it is eligible for capitalisation.
Land and buildings are measured at cost less accumulated depreciation on buildings and less any impairment losses recognised.
Depreciation is calculated on a straight-line basis over the estimated useful life of the assets as follows:
Major depreciation periods are:
2007
2006
Freehold buildings:
40 years
40 years
Leasehold improvements:
5 to 20 years
5 to 20 years
Other plant and equipment:
3 to 15 years
3 to 15 years
37 infomedia.com.au
Annual Report
Notes to the
Financial Statements
30 June 2007
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(m) Property, plant and equipment (continued)
The assets’ residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at each fi nancial year end.
(i) Impairment
The carrying values of property, plant and equipment are reviewed for impairment at each reporting date, with the recoverable
amount being estimated when events or changes in circumstances indicate that the carrying value may be impaired.
The recoverable amount of property, plant and equipment is the higher of fair value less costs to sell and value in use. In assessing
value in use, the estimated future cash fl ows are discounted to their present value using a pre-tax discount rate that refl ects current
market assessments of the time value of money and the risks specifi c to the asset.
For an asset that does not generate largely independent cash infl ows, recoverable amount is determined for the cash generating
unit to which the asset belongs, unless the asset’s value in use can be estimated to be close to its fair value.
An impairment exists when the carrying value of an asset or cash generating units exceeds its estimated recoverable amount. The
asset or cash-generating unit is then written down to its recoverable amount.
(ii) Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefi ts are expected
from its use or disposal.
Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the
carrying amount of the asset) is included in profi t or loss in the year the asset is derecognised.
(n) Leases
The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement and requires an
assessment of whether the fulfi lment of the arrangement is dependent on the use of a specifi c asset or assets and the arrangement
conveys a right to use the asset.
(i) Company as a lessee
Operating lease payments are recognised as an expense in the income statement on a straight-line basis over the lease term. Lease
incentives are recognised in the income statement as an integral part of the total lease expense.
(ii) Company as a lessor
Leases in which the Company retains substantially all the risks and benefi ts of ownership of the leased asset are classifi ed as
operating leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset
and recognised as an expense over the lease term on the same basis as rental income (i.e. on a straight-line basis).
infomedia.com.au 38
Annual Report
Notes to the
Financial Statements
30 June 2007
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(o) Trade and other payables
Trade payables and other payables are carried at amortised costs and represent liabilities for goods and services provided to the
Company prior to the end of the fi nancial year that are unpaid and arise when the Company becomes obliged to make future
payments in respect of the purchase of these goods and services.
(p) Provisions
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is
probable that an outfl ow of resources embodying economic benefi ts will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation.
Where the Company expects some or all of a provision to be reimbursed, for example under an insurance contract, the
reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any
provision is presented in the income statement net of any reimbursement.
If the effect of the time value of money is material, provisions are determined by discounting the expected future cash fl ows at
a pre-tax rate that refl ects current market assessments of the time value of money and, where appropriate, the risks specifi c to
the liability.
Where discounting is used, the increase in the provision due to the passage of time is recognised as a borrowing cost.
(q) Deferred revenue
Certain contracts allow annual subscriptions to be invoiced in advance. The components of revenue relating to the subscription
period beyond balance date are recorded as a liability.
(r) Interest bearing loans and borrowings
All loans and borrowings are initially recognised at the fair value of the consideration received less directly attributable
transaction costs.
After initial recognition, interest bearing loans and borrowings are subsequently measured at amortised cost using the effective
interest method.
Borrowing costs are recognised as an expense when incurred.
(s) Contributed equity
Ordinary shares are classifi ed as equity. Incremental costs directly attributable to the issue of new shares or options are shown in
equity as a deduction, net of tax, from the proceeds.
39 infomedia.com.au
Annual Report
Notes to the
Financial Statements
30 June 2007
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(t) Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefi ts will fl ow to the entity and the revenue can be
reliably measured. The following specifi c recognition criteria must also be met before revenue is recognised:
Subscriptions
Subscription revenue is recognised when the copyright article has passed to the buyer with related support revenue being
recognised over the service period. Where the copyright article and related support revenue are inseparable, then the revenue
is recognised over the service period.
Interest
Control of a right to receive consideration for the provision of, or investment in, assets has been attained.
(u) Cost of sales
Cost of sales includes the direct cost of raw materials, direct salary and wages, and agency costs associated with the manufacture
and distribution of the product.
(v) Income tax
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or
paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively
enacted by the balance sheet date.
Deferred income tax is provided on all temporary differences at the balance sheet date between the tax bases of assets and
liabilities and their carrying amounts for fi nancial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
(cid:129) when the deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction
that is not a business combination and that, at the time of the transaction, affects neither the accounting profi t nor taxable
profi t or loss; or
(cid:129) when the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures,
and the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary difference
will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and
unused tax losses, to the extent that it is probable that taxable profi t will be available against which the deductible temporary
infomedia.com.au 40
Annual Report
Notes to the
Financial Statements
30 June 2007
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(v) Income tax (continued)
differences and the carry-forward of unused tax credits and unused tax losses can be utilised, except:
(cid:129) when the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset
or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting
profi t nor taxable profi t or loss; or
(cid:129) when the deductible temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures,
in which case a deferred tax asset is only recognised to the extent that it is probable that the temporary difference will reverse
in the foreseeable future and taxable profi t will be available against which the temporary difference can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no
longer probable that suffi cient taxable profi t will be available to allow all or part of the deferred income tax asset to be utilised.
Unrecognised deferred income tax assets are reassessed at each balance sheet date and are recognised to the extent that it has
become probable that future taxable profi t will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or
the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance sheet date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in profi t or loss.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets against
current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same taxation authority.
The tax consolidated current tax liability and other deferred tax assets are required to be allocated to the members of the tax
consolidated group in accordance with UIG 1052. The group uses a group allocation method for this purpose where the allocated
current tax payable, deferred tax assets and other tax credits for each member of the tax consolidated group are determined as if the
company is a stand-alone taxpayer but modifi ed as necessary to recognise membership of a tax consolidated group. Recognition of
amounts allocated to members of the tax consolidated group has regard to the tax consolidated group’s future tax profi ts.
(w) Other taxes
Revenues, expenses and assets are recognised net of the amount of Goods and Services Tax (GST) except:
(cid:129) when 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
(cid:129) receivables and payables, which 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 balance sheet.
41 infomedia.com.au
Annual Report
Notes to the
Financial Statements
30 June 2007
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(w) Other taxes (continued)
Cash fl ows are included in the cash fl ow statement on a gross basis and the GST component of cash fl ows arising from investing
and fi nancing activities, which is recoverable from, or payable to, the taxation authority is classifi ed as operating cash fl ows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation
authority.
(x) Employee leave benefi ts
(i) Wages, salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefi ts, and annual leave expected to be settled within 12 months of
the reporting date are recognised in other payables in respect of employees’ services up to the reporting date. They are measured
at the amounts expected to be paid when the liabilities are settled. Liabilities for non-accumulating sick leave are recognised when
the leave is taken and are measured at the rates paid or payable.
(ii) Long service leave
The liability for long service leave is recognised in the provision for employee benefi ts 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 using the projected
unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures, and
period of service. Expected future payments are discounted using market yields at the reporting date on national government
bonds with terms to maturity and currencies that match, as closely as possible, the estimated future cash fl ows.
(y) Share based payment transactions
The Company provides benefi ts to employees in the form of share based payment transactions, whereby employees render services
in exchange for shares or options over shares (equity-settled transactions).
There are currently two plans in place to provide these benefi ts:
(i) the Employee Share Plan (ESP); and
(ii) the Employee Option Plan (EOP).
The cost of these equity-settled transactions with employees is measured by reference to the fair value at the date at which they
are granted. The fair value is determined by an external valuer using a binomial model.
In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to the price
of the shares of Infomedia Ltd (‘market conditions’).
infomedia.com.au 42
Annual Report
Notes to the
Financial Statements
30 June 2007
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(y) Share based payment transactions (continued)
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which
the performance conditions are fulfi lled, ending on the date on which the relevant employees become fully entitled to the option
(vesting date).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date refl ects (i) the extent
to which the vesting period has expired and (ii) the number of options that, in the opinion of the Directors of the Company, will
ultimately vest. This opinion is formed based on the best available information at balance date. No adjustment is made for the
likelihood of market performance conditions being met, as the effect of these conditions is included in the determination of fair
value at grant date.
Where the terms of an equity-settled option are modifi ed, as a minimum an expense is recognised as if the terms had not been
modifi ed. In addition, an expense is recognised for any increase in the value of the transaction as a result of the modifi cation, as
measured at the date of modifi cation.
Where an equity-settled option is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not
yet recognised for the option is recognised immediately. However, if a new option is substituted for the cancelled option, and
designated as a replacement option on the date that it is granted, the cancelled and new option are treated as if they were a
modifi cation of the original option, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is refl ected as additional share dilution in the computation of earnings per share.
(z) Earnings per share
Basic earnings per share is determined by dividing the profi t attributed to members of the parent after related income tax expense
by the weighted average number of ordinary shares outstanding during the fi nancial year.
Diluted earnings per share is calculated as net profi t attributable to members, adjusted for:
(cid:129) cost of servicing equity (other than dividends);
(cid:129)
the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised as
expenses; and
(cid:129) other non-discretionary changes in revenue 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.
43 infomedia.com.au
Annual Report
Notes to the
Financial Statements
30 June 2007
Notes
CONSOLIDATED
INFOMEDIA LTD
3.REVENUE AND EXPENSES
(i) Cost of sales
Direct wages
Other
Total cost of sales
(ii) Other income
Net gain on disposal of property, plant and equipment including
property held for resale
Unrealised gain on forward foreign currency exchange contracts
Fair value change on derivatives
Total other income
(iii) Employee benefi t expense
Salaries and wages (including on-costs)
Share based payment expense
Total employee benefi t expense
(iv) Depreciation and amortisation
Depreciation of non-current assets:
Buildings
Leasehold improvements
Offi ce equipment
Furniture and fi ttings
Plant and equipment
Total depreciation of non-current assets
Amortisation of non-current assets:
Intellectual property
Deferred development costs
Total amortisation of non-current assets
Total depreciation and amortisation
3(vi)
31
2007
$’000
11,642
5,806
17,448
-
-
-
-
8,327
47
8,374
-
180
1,140
42
219
1,581
744
1,167
1,911
3,492
2006
$’000
10,922
6,550
17,472
2,432
231
229
2,892
7,758
251
8,009
333
531
1,135
55
389
2,443
283
629
912
3,355
2007
$’000
6,015
5,091
11,106
-
-
-
-
6,970
47
7,017
-
121
993
26
219
1,359
681
976
1,657
3,016
2006
$’000
6,009
7,427
13,436
194
254
229
677
6,600
251
6,851
-
487
1,006
44
389
1,926
134
629
763
2,689
infomedia.com.au 44
Annual Report
Notes to the
Financial Statements
30 June 2007
Notes
CONSOLIDATED
INFOMEDIA LTD
3.REVENUE AND EXPENSES (continued)
(v) Research and development costs
Total research and development costs incurred during the period
Less: development costs deferred
Net research and development costs expensed
(vi) Profi t on sale of assets
Gross proceeds from the sale of property, plant and equipment
Non-refundable payment for capital works
Net proceeds from the sale of assets
Net book value of assets disposed:
Freehold land and buildings
Leasehold improvements
Offi ce equipment
Furniture and fi ttings
Net book value of assets disposed
Gross profi t on sale of assets
Non-cancellable surplus lease space and other non-recoverable lease
incentives on corporate headquarters
Net profi t on sale of assets
13
12
12
12
12
2007
$’000
5,182
(3,235)
1,947
-
-
-
-
-
-
-
-
-
-
-
2006
$’000
4,510
(2,221)
2,289
23,000
(500)
22,500
(16,644)
(1,309)
(29)
(218)
(18,200)
4,300
(1,868)
2,432
2007
$’000
2006
$’000
4,629
(2,682)
1,947
-
-
-
-
-
-
-
-
-
-
-
3,680
(1,424)
2,256
1,750
-
1,750
-
(1,309)
(29)
(218)
(1,556)
194
-
194
45 infomedia.com.au
Annual Report
Notes to the
Financial Statements
CONSOLIDATED
INFOMEDIA LTD
2007
$’000
2006
$’000
2007
$’000
2006
$’000
4,853
(84)
(315)
985
5,439
20,733
6,220
(84)
(315)
(388)
145
(139)
5,439
5,469
(327)
-
1,526
6,668
24,814
7,444
(327)
-
(660)
211
-
6,668
4,497
(118)
-
1,119
5,498
19,995
5,999
(118)
-
(347)
138
(174)
5,498
3,799
(225)
-
1,292
4,866
18,566
5,570
(225)
-
(601)
122
-
4,866
30 June 2007
4. INCOME TAX
The major components of income tax expense are:
Income statement
Current income tax:
Current income tax charge
Adjustments in respect of current income tax of previous years
Adjustments in respect of capital gains tax of previous years
Deferred income tax:
Relating to origination and reversal of temporary differences
Income tax expense reported in the income statement
A reconciliation between tax expense and the product
of accounting profi t before income tax multiplied by the
Company’s applicable income tax rate is as follows:
Accounting profi t before income tax
At the Company’s statutory income tax rate of 30% (2006: 30%)
Adjustments in respect of current income tax of previous years
Adjustments in respect of capital gains tax of previous years
Additional research and development deduction
Expenditure not allowable for income tax purposes
Other
Income tax expense reported in the income statement
Tax consolidation
Effective 1 July 2002, for the purposes of income taxation, Infomedia Ltd and its 100% owned Australian subsidiaries have formed a
tax consolidated group. Members of the group have entered into a tax sharing arrangement in order to allocate income tax expense
to the wholly-owned subsidiaries. In addition, the agreement provides for the allocation of income tax liabilities between the
entities should the head entity default on its tax payment obligations. At the balance date, the possibility of default is remote.
Members of the tax consolidated group have also entered into a tax funding agreement. The tax funding agreement provides for
the funding of allocated tax liabilities, tax losses and foreign tax credits for the current period based on recognition, applying
the recognition criteria set out in the accounting policy for income taxes. Allocations under the tax funding agreement are made
after the fi nalisation of the group’s income tax return. The allocation of taxes under the tax funding agreement is recognised as an
increase/decrease in the subsidiaries’ intercompany accounts with the tax consolidated group head company, Infomedia Ltd.
infomedia.com.au 46
Annual Report
Notes to the
Financial Statements
30 June 2007
4. INCOME TAX (CONTINUED)
Deferred income tax
Deferred income tax at 30 June relates to the following:
CONSOLIDATED
Deferred tax liabilities
Prepayments
Derivatives
Property plant and equipment
Deferred development costs
Intellectual property
Currency exchange
Deferred tax assets
Allowance for doubtful debts
Copyright intellectual property
Other payables
Employee entitlement provisions
Other provisions
Currency exchange
Gross deferred income tax assets
Deferred tax expense
PARENT
Deferred tax liabilities
Prepayments
Derivatives
Property plant and equipment
Deferred development costs
Intellectual property
Currency exchange
Deferred tax assets
Allowance for doubtful debts
Copyright intellectual property
Other payables
Employee entitlement provisions
Other provisions
Currency exchange
Deferred tax expense
47 infomedia.com.au
BALANCE SHEET
INCOME STATEMENT
2007
$’000
2006
$’000
2007
$’000
2006
$’000
(1)
-
(120)
(2,195)
(384)
-
(2,700)
77
-
116
551
565
134
(8)
(69)
(150)
(1,574)
(243)
(18)
(2,062)
75
176
97
710
732
-
1,443
1,790
(2)
-
(120)
(1,847)
(384)
-
(2,353)
75
-
107
389
565
114
(5)
(69)
(150)
(1,335)
-
(17)
(1,576)
69
176
91
524
732
-
1,250
1,592
(7)
(69)
(30)
621
141
(18)
(2)
176
(19)
159
167
(134)
985
(3)
(69)
(30)
512
384
(17)
(6)
176
(16)
135
167
(114)
1,119
8
69
150
477
2
18
(94)
176
15
47
681
(23)
1,526
5
69
150
238
-
17
(100)
176
28
51
681
(23)
1,292
Annual Report
Notes to the
Financial Statements
30 June 2007
5. EARNINGS PER SHARE
Basic earnings per share amounts are calculated by dividing net profi t for the year attributable to ordinary equity holders of the
parent by the weighted average number of ordinary shares outstanding during the year.
Diluted earnings per share amounts are calculated by dividing the net profi t attributable to ordinary shareholders by the weighted
average number of ordinary shares outstanding during the year (adjusted for the effects of dilutive options).
The following refl ects the income and share data used in the total operations’ basic and diluted earnings per share computations:
Net profi t attributable to equity holders from continuing operations
Weighted average number of ordinary shares for basic earnings per share
Effect of dilution:
Employee share plans
Share options
CONSOLIDATED
2007
$’000
15,294
2006
$’000
18,146
Number of shares
Number of shares
325,693,490
325,456,844
-
899,919
14,729
132,313
Adjusted weighted average number of ordinary shares for diluted earnings per share
326,593,409
325,603,886
There have been no other transactions involving ordinary shares or potential ordinary shares since the reporting date and before
the completion of these fi nancial statements.
infomedia.com.au 48
Annual Report
Notes to the
Financial Statements
30 June 2007
CONSOLIDATED
INFOMEDIA LTD
6. DIVIDENDS PROPOSED OR PAID
(a) Dividends paid during the year
Franked interim dividend – 1.9 cents (2006: 1.9 cents) per share
Prior year fi nal franked dividend – 2.1 cents (2006: 1.7 cents) per share
Special dividend – 3.5 cents (2006: 3.5 cents) per share
Total dividends paid during the year
(b) Dividends proposed and not recognised as a liability
Final franked dividend – 2.1 cents (2006: 2.1 cents) per share
Special franked dividend – nil (2006: 3.5 cents) per share
(c) Franking credit balance
The amount of franking credits available for the subsequent fi nancial year are:
– franking account balance as at the end of the fi nancial year
– franking credits that will arise from the payment of income taxipayable as
iiiat the end of the fi nancial year
The tax rate at which paid dividends have been franked is 30% (2006: 30%).
Dividends proposed will be franked at the rate of 30% (2006: 30%).
7. TRADE AND OTHER RECEIVABLES (CURRENT)
Trade debtors
Allowance for doubtful debts
Other debtors
2007
$’000
6,194
6,836
11,391
24,421
6,845
-
6,845
2006
$’000
6,184
5,533
11,391
23,108
6,836
11,391
18,227
6,850
(487)
6,363
581
6,944
6,707
(480)
6,227
524
6,751
2007
$’000
2006
$’000
6,194
6,836
11,391
24,421
6,845
-
6,845
1,135
2,228
3,363
3,553
(250)
3,303
515
3,818
6,184
5,533
11,391
23,108
6,836
11,391
18,227
6,362
3,126
9,488
4,180
(228)
3,952
457
4,409
(a) Trade debtors are non-interest bearing and are generally on 30 – 60 day terms. An allowance for doubtful debts is made when there is objective evidence
that a trade debtor is impaired. The amount of the allowance/impairment loss is recognised as the difference between the carrying amount of the debtor and the
estimated future cash fl ows expected to be received from the relevant debtors.
49 infomedia.com.au
Annual Report
Notes to the
Financial Statements
30 June 2007
Notes
CONSOLIDATED
INFOMEDIA LTD
2007
$’000
2006
$’000
2007
$’000
2006
$’000
8. INVENTORIES
Raw materials
At cost
Total inventories at the lower of cost and net realisable value
9. INTERCOMPANY (NON-CURRENT)
Wholly-owned controlled entities
10. OTHER FINANCIAL ASSETS (NON-CURRENT)
Investments in controlled entities
11
Other receivables
11. INTERESTS IN CONTROLLED ENTITIES
Name
Country of
incorporation
Percentage of equity
interest held by the
Company (directly or
indirectly)
IFM Europe Ltd
– ordinary shares
United
Kingdom
Infomedia Investments Pty Ltd
2007
%
100
– ordinary shares – $2 only
Australia
100
Datateck Publishing Pty Ltd
– ordinary shares – $4 only
Australia
100
AutoConsulting Pty Ltd
– ordinary shares – $1 only
Australia
100
IFM North America Inc
– ordinary shares
United States
of America
IFM Germany GmbH*
Germany
100
100
2006
%
100
100
100
100
100
-
* Investment is held by IFM Europe Ltd.
52
52
-
-
-
335
335
84
84
-
-
-
804
804
52
52
1,623
1,623
248
335
583
71
71
451
451
248
804
1,052
247
247
-
-
-
1
-
-
-
-
1
-
248
248
infomedia.com.au 50
Annual Report
Notes to the
Financial Statements
30 June 2007
CONSOLIDATED
INFOMEDIA LTD
2007
$’000
944
(380)
564
5,675
(4,075)
1,600
266
(93)
173
2,800
(2,320)
480
9,685
(6,868)
2,817
2006
$’000
1,286
(369)
917
6,925
(4,616)
2,309
334
(119)
215
2,597
(1,972)
625
11,142
(7,076)
4,066
2007
$’000
515
(101)
414
4,583
(3,321)
1,262
123
(57)
66
2,800
(2,320)
480
8,021
(5,799)
2,222
2006
$’000
915
(148)
767
5,834
(3,943)
1,891
212
(93)
119
2,597
(1,972)
625
9,558
(6,156)
3,402
12. PROPERTY, PLANT AND EQUIPMENT
Leasehold improvements
At cost
Accumulated amortisation
Offi ce equipment
At cost
Accumulated depreciation
Furniture and fi ttings
At cost
Accumulated depreciation
Plant and equipment
At cost
Accumulated depreciation
Total property, plant and equipment
At cost
Accumulated depreciation and amortisation
Total written down amount
51 infomedia.com.au
Annual Report
Notes to the
Financial Statements
30 June 2007
CONSOLIDATED
INFOMEDIA LTD
2007
$’000
2006
$’000
2007
$’000
2006
$’000
12. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
(b) Reconciliation of property, plant and equipment carrying
values
Freehold land and buildings
Carrying amount – opening balance
Disposals
Depreciation
Carrying amount – closing balance
Leasehold Improvements
Carrying amount – opening balance
Additions
Disposals
Depreciation
Carrying amount – closing balance
Offi ce equipment
Carrying amount – opening balance
Additions
Disposals
Depreciation
Carrying amount – closing balance
Furniture and fi ttings
Carrying amount – opening balance
Additions
Disposals
Depreciation
Carrying amount – closing balance
Plant and equipment
Carrying amount – opening balance
Additions
Depreciation
Carrying amount – closing balance
-
-
-
-
917
81
(254)
(180)
564
2,309
686
(255)
(1,140)
1,600
215
31
(31)
(42)
173
625
74
(219)
480
16,976
(16,644)
(332)
-
2,138
619
(1,309)
(531)
917
2,192
1,281
(29)
(1,135)
2,309
387
101
(218)
(55)
215
889
125
(389)
625
-
-
-
-
767
15
(247)
(121)
414
1,891
602
(238)
(993)
1,262
119
-
(27)
(26)
66
625
74
(219)
480
-
-
-
-
2,039
524
(1,309)
(487)
767
1,957
969
(29)
(1,006)
1,891
378
3
(218)
(44)
119
889
125
(389)
625
infomedia.com.au 52
13. INTANGIBLE ASSETS
AND GOODWILL
At 1 July 2006
Cost (gross carrying amount)
Accumulated amortisation
Net carrying amount
Year ended 30 June 2007
At 1 July 2006, net of
accumulated amortisation and
impairment
Disposals – Business Systems
assets
Other movements
Amortisation
At 30 June 2007, net of accumulated
amortisation and impairment
At 30 June 2007
Annual Report
Notes to the
Financial Statements
30 June 2007
CONSOLIDATED
INFOMEDIA LTD
Development
costs1
Intellectual
property2
Goodwill2
Total
Development
costs1
Intellectual
property2
Goodwill2
Total
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
6,229
(980)
5,249
3,910
(621)
3,289
8,837
-
8,837
18,976
(1,601)
17,375
5,432
(980)
4,452
2,410
(134)
2,276
6,026
-
6,026
13,868
(1,114)
12,754
Additions – internal development
3, 235
-
-
3,235
5,249
3,289
8,837
17,375
-
-
(1,167)
(950)
(314)
(744)
(296)
(1,246)
-
-
(314)
(1,911)
4,452
2,682
-
-
(976)
2,276
6,026
12,754
-
-
(314)
(681)
-
-
-
-
2,682
-
(314)
(1,657)
7,317
1,281
8,541
17,139
6,158
1,281
6,026
13,465
Cost (gross carrying amount)
Accumulated amortisation
Net carrying amount
9,464
(2,147)
7,317
2,096
(815)
1,281
8,541
-
8,541
20,101
(2,962)
17,139
8,114
(1,956)
6,158
2,096
(815)
1,281
6,026
-
6,026
16,236
(2,771)
13,465
1. Internally generated.
2. Purchased as part of business/territory acquisition.
Development costs have been capitalised at cost. This intangible asset has been assessed as having a fi nite life and is amortised using the straight-line method
over a period not exceeding four years commencing from the commercial release of the project. If an impairment indication arises, the recoverable amount is
estimated and an impairment loss is recognised to the extent that the recoverable amount is lower than the carrying amount.
Intellectual property includes intangible assets acquired through business or territory acquisition and relates primarily to copyright and software code over key
products. Intellectual property is amortised over its useful life, being 10 years.
53 infomedia.com.au
Annual Report
Notes to the
Financial Statements
CONSOLIDATED
INFOMEDIA LTD
Development
costs
Intellectual
property
Goodwill
$’000
$’000
$’000
Total
$’000
Development
costs
Intellectual
property
Goodwill
$’000
$’000
$’000
Total
$’000
4,008
(351)
3,657
3,657
2,221
-
(629)
1,500
(338)
1,162
8,837
-
8,837
14,345
(689)
13,656
1,162
8,837
13,656
-
2,410
(283)
-
-
-
2,221
2,410
(912)
4,008
(351)
3,657
3,657
1,424
-
(629)
-
-
-
-
-
2,410
(134)
6,026
10,034
-
6,026
(351)
9,683
6,026
-
-
-
9,683
1,424
2,410
(763)
5,249
3,289
8,837
17,375
4,452
2,276
6,026
12,754
6,229
(980)
5,249
3,910
(621)
3,289
8,837
-
8,837
18,976
(1,601)
17,375
5,432
(980)
4,452
2,410
(134)
2,276
6,026
-
6,026
13,868
(1,114)
12,754
13. INTANGIBLE ASSETS AND
GOODWILL (CONTINUED)
At 1 July 2005
Cost (gross carrying amount)
Accumulated amortisation
Net carrying amount
Year ended 30 June 2006
At 1 July 2005, net of accumulated
amortisation and impairment
Additions – internal development
Purchased intellectual property
Amortisation
At 30 June 2006, net of accumulated
amortisation and impairment
At 30 June 2006
Cost (gross carrying amount)
Accumulated amortisation
Net carrying amount
infomedia.com.au 54
Annual Report
Notes to the
Financial Statements
14. IMPAIRMENT TESTING OF GOODWILL AND INTANGIBLES WITH INDEFINITE LIVES
Goodwill acquired through business combinations has been allocated to two individual cash generating units for impairment testing as follows:
(cid:129) Electronic Catalogue and Publishing cash generating unit;
(cid:129) Business Systems (NOVA product group) cash generating unit.
Electronic Catalogue and Publishing cash generating unit
The recoverable amount of the Electronic Catalogue and Publishing cash generating unit has been determined based on a value in use calculation using cash fl ow
projections based on fi nancial budgets approved by senior management.
The pre-tax discount rate applied to cash fl ow projections is 14% (2006: 14%), covering a fi ve year period. The discount rates refl ect management’s estimate of the
time value of money and the risks specifi c to the unit. In determining the discount rate for the unit, regard has been given to the yield on a government bond.
Business Systems (NOVA product group) cash generating unit
There is no carrying value at 30 June 2007 for Business Systems due to its sale on 1 December 2006. For the 2006 fi nancial year, the recoverable amount of the
Business Systems (NOVA product group) cash generating unit has also been determined based on a value in use calculation using cash fl ow projections based on
fi nancial budgets approved by senior management.
The pre-tax discount rate applied to cash fl ow projections was 14% covering a fi ve year period.
Carrying amount of goodwill allocated to each of the cash generating units is as follows:
Catalogue and Publishing
Business Systems
(NOVA product group)
Total
CONSOLIDATED
Carrying amount of goodwill
PARENT
2007
$’000
8,541
2006
$’000
8,541
Carrying amount of goodwill
6,026
6,026
Key assumptions used in value in use calculations for 30 June 2007 and 30 June 2006
2007
$’000
-
-
2006
$’000
296
2007
$’000
8,541
2006
$’000
8,837
-
6,026
6,026
The following describes each key assumption on which management has based its cash fl ow projections when determining the value in use of its cash generating units:
(cid:129)
the Company will continue to have access to the data supply from automakers over the budgeted period;
(cid:129)
the Company will not experience any substantial adverse movements in currency exchange rates; and
(cid:129)
the Company’s research and development program will ensure that the current suite of products remains leading edge.
With regard to the assessment of the value in use of the Electronic Catalogue and Publishing cash generating unit, management believes that no reasonably
possible change in any of the above key assumptions would cause the carrying value of the unit to materially exceed its recoverable amount.
55 infomedia.com.au
Annual Report
Notes to the
Financial Statements
30 June 2007
Notes
CONSOLIDATED
INFOMEDIA LTD
15. TRADE AND OTHER PAYABLES (CURRENT)
Trade creditors
Other creditors
15(a)
2007
$’000
443
2,039
2,482
2006
$’000
1,131
2,843
3,974
2007
$’000
139
1,613
1,752
2006
$’000
565
2,423
2,988
(a) Trade creditors are non-interest bearing and are normally settled on
30 day terms.
16. INTEREST BEARING LOANS AND BORROWINGS
iiiii(CURRENT)
iiiii
Bank loans
(a) The bank loan drawings have been made under a multi-currency
cash advance facility. The drawings at balance date are denominated
in Australian dollars. The USD13 million facility terminates in
August 2008 (refer also Notes 21(c), 23(c) and 31).
16(a)
-
-
500
500
-
-
500
500
17. PROVISIONS (CURRENT)
Employee benefi ts
Provision for non-cancellable surplus lease space and other lease
incentives
19(a)
18. DEFERRED REVENUE (CURRENT)
Revenue in advance
1,790
494
2,284
506
506
2,063
648
2,711
816
816
1,118
494
1,612
254
254
1,353
648
2,001
405
405
infomedia.com.au 56
Annual Report
Notes to the
Financial Statements
30 June 2007
Notes
CONSOLIDATED
INFOMEDIA LTD
19. PROVISIONS (NON-CURRENT)
Employee benefi ts
Provision for non-cancellable surplus lease space and other lease
incentives
Make good provision
19(a)
19(b)
(a) Movement in non-cancellable surplus lease space and other
lease incentives provision:
Carrying amount at the beginning of the year
Arising during the year
Utilised
Discount rate adjustment
Carrying amount at the end of the year
Current
Non-current
17
The provision for non-cancellable lease space and other lease
incentives has been made pursuant to the lease obligations under
contract to the extent that no future benefi ts are anticipated.
(b) Movement in make good provision:
Carrying amount at the beginning of the year
Arising during the year
Carrying amount at the end of the year
The provision for make good has been estimated pursuant to
the Company’s obligation to restore leased premises to original
condition at the end of the lease term.
2007
$’000
315
891
500
1,706
1,942
-
(688)
131
1,385
494
891
1,385
500
-
500
2006
$’000
545
1,294
500
2,339
178
1,868
(104)
-
1,942
648
1,294
1,942
-
500
500
2007
$’000
177
891
500
1,568
1,942
-
(688)
131
1,385
494
891
1,385
500
-
500
2006
$’000
393
1,294
500
2,187
178
1,868
(104)
-
1,942
648
1,294
1,942
-
500
500
57 infomedia.com.au
Annual Report
Notes to the
Financial Statements
30 June 2007
CONSOLIDATED
INFOMEDIA LTD
20. CONTRIBUTED EQUITY AND RESERVES
Ordinary shares
2007
$’000
17,738
17,738
2006
$’000
17,488
17,488
2007
$’000
17,738
17,738
2006
$’000
17,488
17,488
Effective 1 July 1998, the Corporations legislation in place abolished the concepts of authorised capital and par value shares. Accordingly, the parent does not
have authorised capital nor par value in respect of its issued shares.
Fully paid ordinary shares carry one vote per share and carry the right to dividends.
Movement in ordinary shares on issue
At 1 July 2005
Employee Share Plan issuance
At 30 June 2006
Employee options exercised
At 30 June 2007
Employee Option Plan
Notes
Number
$’000
24
24
325,156,205
315,368
325,471,573
499,999
325,971,572
17,488
-
17,488
250
17,738
There were no options issued during the current year. A total of 1,700,000 options were issued to eligible employees during the prior year at an average exercise
price of $0.50. Refer to Note 24.
30 June 2007
Movement in reserves
At 1 July 2005
Currency translation differences
Share based payments
At 30 June 2006
Currency translation differences
Share based payments
At 30 June 2007
Nature and purpose of reserves
Employee equity benefi ts reserve
CONSOLIDATED
Employee equity
benefi ts reserve
Foreign currency
translation reserve
$’000
$’000
725
-
251
976
-
47
1,023
(19)
53
-
34
(79)
-
(45)
Total
$’000
706
53
251
1,010
(79)
47
978
INFOMEDIA LTD
Employee equity
benefi ts reserve
$’000
725
-
251
976
-
47
1,023
This reserve is used to record the value of equity benefi ts provided to employees and Directors as part of their compensation. Refer to Note 24 for further details.
Foreign currency translation reserve
The foreign currency translation reserve is used to record exchange differences arising from the translation of the fi nancial statements of foreign subsidiaries. It is
also used to record the effect of hedging net investments in foreign operations.
infomedia.com.au 58
Annual Report
Notes to the
Financial Statements
30 June 2007
CONSOLIDATED
INFOMEDIA LTD
21. STATEMENT OF CASH FLOWS
(a) Reconciliation of profi t after tax to the net cash fl ows from operations
Profi t from ordinary activities after income tax expense
Depreciation of non-current assets
Amortisation of non-current assets
Amortisation of employee options
Net (profi t)/loss on sale of business
Gross profi t on sale of property, plant and equipment including property
held for resale
Changes in assets and liabilities
(Increase)/decrease in trade and other debtors
(Increase)/decrease in inventories
(Increase)/decrease in prepayments
(Increase)/decrease in future income tax benefi t
(Increase)/decrease in deferred development costs
Decrease/(increase) in trade and other creditors
Decrease/(increase) in allowance for doubtful debts
Decrease/(increase) in provision for employee entitlements
Decrease/(increase) in other provisions
Decrease/(increase) in income tax payable
Decrease/(increase) in deferred income tax liability
Decrease/(increase) in revenue in advance
Net cash fl ow from operating activities
(b) Reconciliation of cash
Cash balance comprises:
– cash at bank
– cash on deposit
2007
$’000
15,294
1,581
1,911
47
(15)
-
415
32
97
348
(3,235)
(1,168)
8
(505)
(270)
(1,180)
639
45
14,044
4,404
11,286
15,690
2006
$’000
18,146
2,443
912
251
-
(4,300)
(31)
4
(4)
(803)
(2,221)
21
(399)
178
1,868
2,236
721
7
19,029
25,853
168
26,021
2007
$’000
14,497
1,359
1,657
47
76
-
(1,279)
20
144
341
(2,682)
(917)
23
(485)
(270)
476
777
(151)
13,633
2006
$’000
13,700
1,926
763
251
-
(194)
2,475
(29)
(14)
(813)
(1,424)
(320)
(332)
66
1,868
673
478
38
19,112
3,116
10,428
13,544
25,079
10
25,089
(c) Financing facilities available
At reporting date, the following fi nancing facilities had been negotiated and
were available:
Total facilities
USD13 million multi-currency cash advance facility
15,350
17,580
15,350
17,580
Facilities used at reporting date
Bank loans
Facilities unused at reporting date
Bank loans
-
500
-
500
15,350
17,080
15,350
17,080
59 infomedia.com.au
Annual Report
Notes to the
Financial Statements
30 June 2007
22. SALE OF BUSINESS
CONSOLIDATED
INFOMEDIA LTD
2007
$’000
2006
$’000
2007
$’000
2006
$’000
On 1 December 2006, Infomedia sold its Business Systems Division to an
unrelated third party.
The components of the disposal were:
Gross consideration
Net working capital adjustments
Cash proceeds
Net book value of assets and liabilities disposed:
– Plant and equipment
– Intangible assets
– Other net liabilities
Total net assets disposed
Net profi t on sale of business
23. COMMITMENTS & CONTINGENCIES
(a) Lease expenditure commitments
Operating leases (non-cancellable)
Minimum lease payments
– not later than one year
– later than one year and not later than fi ve years
– aggregate operating lease expenditure contracted for at balance date
1,500
(331)
1,169
540
1,245
(631)
1,154
15
1,540
4,093
5,633
-
-
-
-
-
-
-
-
150
35
185
512
-
(251)
261
(76)
-
-
-
-
-
-
-
-
1,657
4,483
6,140
1,098
3,463
4,561
1,199
3,453
4,652
Operating lease commitments are for offi ce accommodation both in Australia and abroad.
(b) Performance bank guarantee
Infomedia Ltd has a performance bank guarantee to a maximum value of $700,000 relating to the lease commitments of its corporate headquarters.
(c) Interlocking guarantees
The bank loan drawings have been made pursuant to a multi-currency cash advance facility. The facility has been provided on the condition of interlocking
guarantees between the parent entity and its controlled entities (the guarantors).
infomedia.com.au 60
Annual Report
Notes to the
Financial Statements
24. SHARE BASED PAYMENT PLANS
Employee Option Plan
The Employee Option Plan entitles the Company to offer ‘eligible employees’ options to subscribe for shares in the Company. Options will be granted at a nil
issue price unless otherwise determined by the Directors of the Company and each option enables the holder to subscribe for one share. The exercise price for
the options granted will be as specifi ed on the option certifi cate or, if not specifi ed, the volume weighted average price for shares of the Company for the fi ve
days trading immediately before the day on which the options were granted. The options may be exercised in accordance with the date determined by the Board,
which must be within four years of the option being granted.
Information with respect to the number of options granted under the employee share incentive scheme is as follows:
Notes
2007
2006
Number of options
Weighted average
exercise price
Number of options
Weighted average
exercise price
Balance at beginning of year
– granted
– forfeited
– exercised
Balance at end of year
24(a)
24(b)
24(c)
24(d)
1,950,000
-
(150,000)
(499,999)
1,300,001
$0.52
-
$0.75
$0.50
$0.51
727,000
1,700,000
(477,000)
-
1,950,000
$0.73
$0.50
$0.73
-
$0.52
(a) Options held at the beginning of the year
The following table summarises information about options held by employees at 1 July 2006:
Number of options
150,000
100,000
250,000
1,000,000
250,000
200,000
Grant date
24/5/2004
20/9/2004
8/7/2005
27/10/2005
6/10/2005
16/12/2005
Earliest
vesting date
24/5/2005
20/9/2005
5/1/2006
5/1/2006
5/1/2006
Expiry date
31/5/2007
20/9/2007
5/2/2008
5/2/2008
5/2/2008
16/12/2006
16/1/2009
Weighted average
exercise price
$0.75
$0.67
$0.50
$0.50
$0.48
$0.49
(b) Options granted during the year
There were no options granted during the year ended 30 June 2007.
(c) Options exercised during the year
The following table summarises information about options exercised by employees during the year:
Number of options exercised
499,999
Weighted average exercise price
Weighted average share price at
date of exercise
$0.50
$0.79
61 infomedia.com.au
Annual Report
Notes to the
Financial Statements
24. SHARE BASED PAYMENT PLANS (CONTINUED)
(d) Options held at the end of the year
The following table summarises information about options held by employees at 30 June 2007:
Number of options
Grant date
Earliest vesting date
Expiry date
100,000
83,334
666,667
250,000
200,000
20/9/2004
8/7/2005
27/10/2005
6/10/2005
16/12/2005
20/9/2005
20/9/2007
5/1/2006
5/1/2006
5/1/2006
5/2/2008
5/2/2008
5/2/2008
16/12/2006
16/1/2009
Weighted average
exercise price
$0.67
$0.50
$0.50
$0.48
$0.49
(e) Other details regarding options
The weighted average fair value of options granted during the prior year was $0.087 (there were no options granted during the current year).
The fair value of the equity-settled options granted under the option plan is estimated as at the grant date using a binomial model taking into account the term
and conditions upon which the options were granted.
The following table lists the inputs to the model used for the year:
Dividend yield (%)
Expected volatility (%)
Risk free rate (%)
Option exercise price
Weighted average share price at grant date
25. PENSIONS AND OTHER POST-EMPLOYMENT PLANS
Superannuation Commitments
2007
2006
n/a
n/a
n/a
n/a
n/a
6.8%
37.9%
5.4%
$0.50
$0.50
Contributions are made by the Company in accordance with the relevant statutory requirements. Contributions by the Company for the year ended 30 June 2007
were 9% (2006: 9%) of employees’ wages and salaries, which are legally enforceable in Australia. The superannuation plans provide accumulation benefi ts.
infomedia.com.au 62
Annual Report
Notes to the
Financial Statements
26. KEY MANAGEMENT PERSONNEL DISCLOSURES
Infomedia Ltd has adopted the option available under the Corporation Regulations 2M.6.04 (as amended by the Corporation Amendments Regulation 2006
(No. 4)) which permits listed companies to transfer the remuneration disclosures required under AASB124 para Aus 25.4 – Aus 25.7.2 out of the Financial Report
and into the Remuneration Report. The transferred AASB124 disclosures are subject to audit.
(a) Details of Key Management Personnel
(i) Directors
Richard Graham
Gary Martin
Myer Herszberg
Chairman
Chief Executive Offi cer
Non-executive Director
Geoffrey Henderson (resigned 28 February 2007) Non-executive Director
Frances Hernon
Andrew Moffat
(ii) Executives
Andrew Pattinson
Peter Adams
Mark Kujacznski
Michael Roach
Nick Georges
Non-executive Director
Non-executive Director
Managing Director – IFM Europe Ltd
Chief Financial Offi cer
Vice President – IFM North America Inc
General Manager – Electronic Catalogue and Data Management
Company Secretary and Legal Counsel
(b) Compensation of Key Management Personnel
(i) Compensation by Category: Key Management Personnel
CONSOLIDATED
INFOMEDIA LTD
2007
$
2006
$
2007
$
2006
$
1,868,431
1,707,944
1,101,169
1,040,551
129,314
15,442
-
79,839
123,725
15,130
-
92,310
86,179
7,417
-
72,507
82,408
7,479
-
84,024
2,093,026
1,939,109
1,267,272
1,214,462
Short term
Post employment
Other long term
Termination benefi ts
Share based payments
63 infomedia.com.au
Annual Report
Notes to the
Financial Statements
26. KEY MANAGEMENT PERSONNEL DISCLOSURES (CONTINUED)
(c) Shareholdings of Key Management Personnel
30 June 2007
Number of shares held in Infomedia Ltd
Balance
30 June 2006
Granted as
compensation
On exercise of
options
Net change other
Balance
30 June 2007
Directors
Richard Graham
Myer Herszberg
Gary Martin
Frances Hernon
Executives
Andrew Pattinson
Peter Adams
Nick Georges
Michael Roach
Total
30 June 2006
Number of shares held in Infomedia Ltd
Directors
Richard Graham
Myer Herszberg
Gary Martin
Frances Hernon
Executives
Andrew Pattinson
Nick Georges
Michael Roach
Peter Adams
Total
102,204,060
39,421,599
74,257
5,000
2,447,567
11,421
24,421
18,721
144,207,046
-
-
-
-
-
-
-
-
-
-
-
333,333
-
-
-
102,204,060
(16,000,000)
23,421,599
-
-
-
407,590
5,000
2,447,567
100,000
24,421
18,721
166,666
(78,087)
-
-
-
-
499,999
(16,078,087)
128,628,958
Balance
1 July 2005
Granted as
compensation
On exercise of
options
Net change other
Balance
30 June 2006
102,204,060
39,421,599
74,257
5,000
2,545,571
22,425
16,725
9,425
144,299,062
-
-
-
-
1,996
1,996
1,996
1,996
7,984
-
-
-
-
-
-
-
-
-
-
-
-
-
102,204,060
39,421,599
74,257
5,000
(100,000)
2,447,567
-
-
-
24,421
18,721
11,421
(100,000)
144,207,046
All equity transactions with Key Management Personnel other than those arising from the exercise of compensation options and compensation shares have been
entered into under terms and conditions no more favourable than those the entity would have adopted if dealing at arm’s length.
(d) Loans to Key Management Personnel
There were no loans at the beginning or the end of the reporting period to Key Management Personnel. No loans were made available during the reporting period
to Key Management Personnel.
(e) Other transactions and balances with Key Management Personnel (including related entities)
(i) Infomedia Ltd previously rented offi ce space from Wiser Equity Pty Limited (formerly Wiser Laboratory Pty Limited), a company of which Richard Graham
is a Director. A lease termination payment of $170,000 was made on 9 August 2005 to Wiser Equity Pty Limited to relinquish the Company from its future lease
commitments as the space was no longer used.
infomedia.com.au 64
Annual Report
Notes to the
Financial Statements
26. KEY MANAGEMENT PERSONNEL DISCLOSURES (CONTINUED)
(e) Other transactions and balances with Key Management Personnel (including related entities) (continued)
(ii) Infomedia Ltd rented offi ce space from Richard Graham. The total rent payments for the year ended 30 June 2007 of $79,209 (2006: $176,898) were on
commercial terms.
(iii) Infomedia Ltd received fi nancial consulting services from Cowoso Capital Pty Limited, a company of which Andrew Moffat is a Director. The total consulting
services paid for the year ended 30 June 2007 of $57,500 (2006: $12,500) were on commercial terms.
30 June 2007
CONSOLIDATED
INFOMEDIA LTD
2007
$
2006
$
2007
$
2006
$
27. AUDITOR’S REMUNERATION
Amounts received or due and receivable by the auditor of Infomedia
Ltd for:
– an audit or review of the fi nancial report of the entity and any other
entity in the consolidated entity
191,900
183,350
165,850
158,350
– other services in relation to the entity and any other entity in the
consolidated entity
-
-
-
191,900
183,350
165,850
-
158,350
28. RELATED PARTY DISCLOSURES
Ultimate parent
Infomedia Ltd is the ultimate Australian parent company.
Wholly-owned group transactions
(a) An unsecured, interest free loan of $5,002 (2006: $Nil) remains owing from IFM Germany GmbH to Infomedia Ltd.
(b) An unsecured, interest free loan of $3,131,065 (2006: $2,793,213) remains owing to Infomedia Investments Pty Limited from Infomedia Ltd.
(c) An unsecured, interest free loan of $2,767,113 (2006: $2,126,248) remains owing from Datateck Publishing Pty Limited to Infomedia Ltd. The loan is
repayable in seven days upon demand.
(d) An unsecured, interest free loan of $386,219 (2006: $987,913) remains owing from AutoConsulting Pty Limited to Infomedia Ltd. The loan is repayable
in seven days upon demand.
(e) An unsecured, interest free loan of $59,810 (2006: $1,013,333) remains owing from IFM Europe Ltd to Infomedia Ltd.
(f) An unsecured, interest free loan of $1,535,477 (2006: $1,143,345) remains owing from IFM North America Inc. to Infomedia Ltd.
(g) During the year a management fee of $480,000 (2006: $480,000) was paid to Datateck Publishing Pty Limited by Infomedia Ltd.
(h) During the year, Infomedia Ltd received $13,117,364 (2006: $7,004,846) from IFM Europe Ltd for intra-group sales.
(i) During the year, Datateck Publishing Pty Limited received $746,110 (2006: $279,441) from IFM Europe Ltd for intra-group sales.
(j) During the year, IFM Europe Ltd received $565,934 (2006: $1,571,822) from Infomedia Ltd for intra-group distribution services.
(k) During the year, Infomedia Ltd received $10,363,329 (2006: $8,827,526) from IFM North America Inc. for intra-group sales.
(l) During the year, IFM North America Inc. received $554,699 (2006: $813,558) from Infomedia Ltd for intra-group distribution services.
(m) During the year, IFM Europe paid $398,384 (2006: $nil) to IFM Germany GmbH for intra-group distribution services.
Entity with deemed signifi cant infl uence over the Company
Wiser Equity Pty Limited, a company of which Richard Graham is a Director, owns 30.8% of the ordinary shares in Infomedia Ltd (2006: 30.8%).
65 infomedia.com.au
Annual Report
Notes to the
Financial Statements
29. SEGMENT INFORMATION
(a) Primary segment
30 June 2007
Business Segments
REVENUE
Sales revenue
Rental income
Total segment revenue
Unallocated revenue:
Finance revenue
Total consolidated revenue
Segment result
Unallocated items:
Finance revenue
Finance costs
Notes
Catalogue and Publishing
Business Systems*
$’000
52,990
-
52,990
$’000
1,576
-
1,576
20,019
57
Consolidated profi t before income tax
Income tax expense
4
Consolidated profi t after income tax
ASSETS
Segment assets
Unallocated assets:
Cash
Total assets
LIABILITIES
Segment liabilities
Other segment information:
Capital expenditure
Depreciation
Amortisation
29,162
11,950
873
1,479
1,848
3(iv)
3(iv)
-
-
-
102
63
Total
$’000
54,566
-
54,566
791
55,357
20,076
791
(134)
20,733
(5,439)
15,294
29,162
15,690
44,852
11,950
873
1,581
1,911
* The Business Systems Division was sold on 1 December 2006 for $1,500,000 (refer Note 22). As a result, the segment result shown above represents fi ve
months of trading only.
infomedia.com.au 66
Annual Report
Notes to the
Financial Statements
29. SEGMENT INFORMATION (CONTINUED)
(a) Primary segment (continued)
30 June 2006
Business Segments
REVENUE
Sales revenue
Rental income
Total segment revenue
Unallocated revenue:
Finance revenue
Total consolidated revenue
Segment result
Unallocated items:
Finance revenue
Finance costs
Notes
Catalogue and Publishing
Business Systems
$’000
51,635
646
52,281
$’000
3,942
-
3,942
24,634
109
Consolidated profi t before income tax
Income tax expense
4
Consolidated profi t after income tax
Total
$’000
55,577
646
56,223
268
56,491
24,743
268
(197)
24,814
(6,668)
18,146
ASSETS
Segment assets
Unallocated assets:
Cash
Total assets
LIABILITIES
Segment liabilities
Other segment information:
Capital expenditure
Depreciation
Amortisation
67 infomedia.com.au
28,889
2,754
31,643
26,021
57,664
14,754
1,099
15,853
1,522
2,149
762
3(iv)
3(iv)
103
294
150
1,625
2,443
912
Annual Report
Notes to the
Financial Statements
29. SEGMENT INFORMATION (CONTINUED)
(b) Secondary Segment
30 June 2007
Geographical segments
REVENUE
Segment revenue
Unallocated revenue:
Finance revenue
Total consolidated revenue
ASSETS
Segment assets
Unallocated assets:
Cash
Total assets
Capital expenditure
30 June 2006
Geographical segments
REVENUE
Segment revenue
Unallocated revenue:
Finance revenue
Rental income
Total consolidated revenue
ASSETS
Segment assets
Unallocated assets:
Cash
Total assets
Capital expenditure
Europe
$’000
North America
Asia Pacifi c
Latin and South
America
$’000
$’000
$’000
Total
$’000
20,511
16,343
13,870
3,842
54,566
1,345
1,480
26,337
8
4
861
-
-
Europe
$’000
North America
Asia Pacifi c
$’000
$’000
Latin & South
America
$’000
18,437
17,876
15,779
3,485
556
1,514
29,573
19
211
1,395
-
-
791
55,357
29,162
15,690
44,852
873
Total
$’000
55,577
268
646
56,491
31,643
26,021
57,664
1,625
(c) Segment products and locations
The Company’s operating divisions are organised and managed separately according to the nature of the products and the services they provide, with each segment
offering different products. Infomedia’s core business involves the production of the Microcat and Partfi nder Electronic Parts Catalogues and the Superservice
Menus service quoting system. These systems are specialised business tools designed to make the selection and sale of replacement parts fast, easy and accurate.
All products are sourced from Australia.
infomedia.com.au 68
Annual Report
Notes to the
Financial Statements
29. SEGMENT INFORMATION (CONTINUED)
(d) Segment accounting policies
The Company generally accounts for intersegment sales and transfers as if the sales or transfers were to third parties at current market prices.
Segment accounting polices are the same as the Company’s accounting policies described in Note 2. The geographical segment revenue is classifi ed according
to customer destination as opposed to the billing source. This classifi cation represents a change in presentation from the prior years with the 2006 comparative
fi gures restated accordingly. The change in classifi cation has been driven by enhancements to internal management reporting.
Geographical assets have been classifi ed according to location of the asset. The Asia Pacifi c disclosures include corporate assets.
30. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Company’s principal fi nancial instruments, other than derivatives, comprise bank loans, cash and short term deposits.
The main purpose of these fi nancial instruments is to raise fi nance for the Company’s operations. The Company has various other fi nancial assets and liabilities
such as trade receivables and trade payables, which arise directly from its operations. The Company also enters into derivative transactions through forward
currency contracts. The purpose is to manage the currency risks arising from the Company’s operations. It is, and has been throughout the period under review,
the Company’s policy that no trading in fi nancial instruments shall be undertaken. The main risks arising from the Company’s fi nancial instruments are cash fl ow
interest rate risk, liquidity risk, foreign currency risk and credit risk.
Details of the signifi cant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement and the basis on which income
and expenses are recognised, in respect of each class of fi nancial asset, fi nancial liability and equity instrument are disclosed in Note 2 to the fi nancial statements.
Cash fl ow interest rate risk
The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s cash holdings with a fl oating interest rate.
The Company’s policy is to accept the fl oating interest rate risk with both its cash holdings and bank loans. Cash is held primarily with leading Australian banks
for periods not exceeding 30 days. Bank loans are drawn with varying bill maturities ranging from 30 to 180 days accepting the fl oating rate of interest.
Foreign currency risk
The Company has transactional currency exposures. These exposures mainly arise from the transactional sale of products and to a lesser extent the associated
cost of sales component relating to these products. As the Company’s product offerings are typically made on a recurring monthly subscription basis, there is a
relatively high degree of reliability in estimating a proportion of future cash fl ow exposures. Approximately half of the Company’s sales are denominated in United
States dollars and around one third of the Company’s sales are denominated in Euro. The Company seeks to mitigate exposure to movements in these currencies
by entering into forward exchange derivative contracts periodically.
As a result of the Company’s recent investment in both its European and its United States subsidiaries, the Company’s balance sheet can be affected by movements
in both the Euro and the United States dollar against the Australian dollar. As the net earnings from these operations are repatriated back to Australia on a regular
basis, the Company does not seek to hedge this exposure.
Credit risk
The Company’s credit risk with regard to accounts receivable is spread broadly across three automotive groups – manufacturers, distributors and dealerships.
Receivable balances are monitored on an ongoing basis, with the result that the Company’s exposure to bad debts is not signifi cant. As the products typically
have a monthly life cycle and are priced on a relatively low subscription price, the concentration of credit risk is typically low, with automotive manufacturers
being the exception.
With respect to credit risk arising from the other fi nancial assets of the Company, which comprise cash and cash equivalents, available-for-sale fi nancial assets
and certain derivative instruments, the Company’s exposure to credit risk arises from default of the counter party, with a maximum exposure equal to the carrying
amount of these instruments.
Since the Company trades only with recognised third parties, there is no requirement for collateral.
Liquidity risk
The Company’s exposure to liquidity risk is minimal given the relative strength of the balance sheet and strong cash fl ows from operations.
69 infomedia.com.au
Annual Report
Notes to the
Financial Statements
31. FINANCIAL INSTRUMENTS
Fair values
Set out below is a comparison by category of carrying amounts and fair values of all of the Company’s fi nancial instruments recognised in the fi nancial statements.
The fair values of derivatives have been calculated by discounting the expected future cash fl ows at prevailing interest rates.
CONSOLIDATED
Financial assets
Cash and cash equivalents
Trade receivables
Forward currency contracts
Other fi nancial assets (non-current)
Financial liabilities
Trade payables
Interest bearing loans and borrowings
Off balance sheet
Contingencies
PARENT
Financial assets
Cash and cash equivalents
Trade receivables
Forward currency contracts
Intercompany
Other fi nancial assets (non-current)1
Financial liabilities
Trade payables
Interest bearing loans and borrowings
Off balance sheet
Contingencies
Carrying amount
Fair value
2007
$’000
15,690
6,363
-
335
2,482
-
-
2006
$’000
26,021
6,227
229
804
3,974
500
2007
$’000
15,690
6,363
-
335
2,482
-
2006
$’000
26,021
6,227
229
804
3,974
500
-
700
700
Carrying amount
Fair value
2007
$’000
13,544
3,303
-
1,623
583
1,752
-
-
2006
$’000
25,089
3,952
229
451
1,052
2,988
500
2007
$’000
13,544
3,303
-
1,623
6,150
1,752
-
2006
$’000
25,089
3,952
229
451
5,901
2,988
500
-
700
700
1. Other fi nancial assets for the parent entity include investment in wholly-owned subsidiaries. The fair value of the underlying net assets of the subsidiaries is
higher than the carrying amount in the parent entity accounts.
Contingencies
The Company and certain controlled entities have potential fi nancial liabilities that may arise from certain contingencies disclosed in Note 22. As explained in
that note, no material losses are anticipated in respect of any of those contingencies and the fair value disclosed above is the Directors’ estimate of amounts that
would be payable by the Company as consideration of the assumption of those contingencies by another party.
infomedia.com.au 70
Annual Report
Notes to the
Financial Statements
31. FINANCIAL INSTRUMENTS (CONTINUED)
Interest rate risk
The following table sets out the carrying amount, by maturity, of the fi nancial instruments exposed to interest rate risk:
Year ended 30 June 2007
CONSOLIDATED
PARENT
Less than one
year
Two to fi ve
years
Greater than
fi ve years
Less than one
year
Two to fi ve
years
Greater than
fi ve years
Weighted
average
effective
interest rate
%
Weighted
average
effective
interest rate
%
Floating rate
$’000
$’000
$’000
$’000
$’000
$’000
Cash and cash equivalents
Interest bearing liabilities
15,690
-
-
-
-
-
5.7
-
13,544
-
Year ended 30 June 2006
CONSOLIDATED
-
-
5.7
-
-
-
PARENT
Less than one
year
Two to fi ve
years
Greater than
fi ve years
Less than one
year
Two to fi ve
years
Greater than
fi ve years
Weighted
average
effective
interest rate
%
Weighted
average
effective
interest rate
%
Floating rate
Cash and cash equivalents
Interest bearing liabilities
$’000
$’000
$’000
$’000
$’000
$’000
26,021
(500)
-
-
-
-
5.7
6.3
25,089
(500)
-
-
-
-
5.7
6.3
Interest on fi nancial instruments classifi ed as fl oating rate is repriced at intervals of less than one year. Interest on fi nancial instruments classifi ed as fi xed rate is
fi xed until maturity of the instrument. The other fi nancial instruments of the group and parent that are not included in the above tables are non-interest bearing
and are therefore not subject to interest rate risk.
Derivative contracts
There were no derivative contracts on hand at 30 June 2007. The following table summarises the forward exchange contracts on hand at 30 June 2006:
Maturity
Company buys
Company sells
Exchange rate
Company buys
Company sells
Exchange rate
CONSOLIDATED
PARENT
Company sells United States Dollars (USD)
Quarter 1 2007 fi nancial year
Quarter 2 2007 fi nancial year
Quarter 3 2007 fi nancial year
Quarter 4 2007 fi nancial year
Company sells Euros (E)
Quarter 1 2007 fi nancial year
Quarter 2 2007 fi nancial year
Quarter 3 2007 fi nancial year
Quarter 4 2007 fi nancial year
$A’000
1,392
2,087
-
-
$A’000
3,077
3,248
3,248
3,248
USD’000
1,000
1,500
-
-
E ’000
1,775
1,875
1,875
1,875
The mark to market valuation of these contracts at 30 June 2006 was $229,000.
32. SUBSEQUENT EVENTS
0.7186
0.7186
-
-
0.5768
0.5773
0.5773
0.5773
$A’000
1,392
2,087
-
-
$A’000
3,077
3,248
3,248
3,248
USD’000
1,000
1,500
-
-
E ’000
1,775
1,875
1,875
1,875
0.7186
0.7186
-
-
0.5768
0.5773
0.5773
0.5773
There has been no matter or circumstance that has arisen since the end of the fi nancial year that has signifi cantly affected the operations of the Company, the
results of those operations, or the state of affairs of the Company.
71 infomedia.com.au
Annual Report
Directors’
Declaration
In accordance with a resolution of the Directors of Infomedia Ltd, I state that:
(1) In the opinion of the Directors:
(a) the fi nancial statements and notes and all the additional disclosures included in the Directors’ Report designated as audited, of the Company and
the consolidated entity are in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Company’s and the consolidated entity’s fi nancial position as at 30 June 2007 and of their performance for the
year ended on that date; and
(ii) complying with Accounting Standards and Corporations Regulations 2001; and
(b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.
(2) This declaration has been made after receiving the declarations required to be made to the Directors in accordance with section 295A of the Corporations
Act 2001 for the fi nancial period ended 30 June 2007.
On behalf of the Board
Richard David Graham
Chairman
Sydney, 22 August 2007
infomedia.com.au 72
Independent audit report to members of Infomedia Ltd
We have audited the accompanying fi nancial report of Infomedia Ltd (the company) and the consolidated entity, which comprises the balance
sheet as at 30 June 2007, and the income statement, statement of changes in equity and cash fl ow statement for the year ended on that date, a
summary of signifi cant accounting policies, other explanatory notes and the Directors’ declaration.
The company has disclosed information as required by paragraphs Aus 25.4 to Aus 25.7.2 of Accounting Standard 124 Related Party
Disclosures (“remuneration disclosures”), under the heading “Remuneration Report” on pages 20 to 25 of the Directors’ Report, as permitted
by Corporations Regulation 2M.6.04.
Directors’ Responsibility for the Financial Report
The Directors of the company are responsible for the preparation and fair presentation of the fi nancial report in accordance with the
Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Act 2001. This responsibility
includes establishing and maintaining internal controls relevant to the preparation and fair presentation of the fi nancial report that is free from
material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates
that are reasonable in the circumstances. In Note 2, the Directors also state that the fi nancial report, comprising the fi nancial statements and
notes complies, with International Financial Reporting Standards. The Directors are also responsible for the remuneration disclosures contained
in the Directors’ Report.
Auditor’s Responsibility
Our responsibility is to express an opinion on the fi nancial report based on our audit. We conducted our audit in accordance with Australian
Auditing Standards. These Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements
and plan and perform the audit to obtain reasonable assurance whether the fi nancial report is free from material misstatement and that the
remuneration disclosures comply with Accounting Standard AASB 124 Related Party Disclosures.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fi nancial report. The procedures
selected depend on our judgment, including the assessment of the risks of material misstatement of the fi nancial report, whether due to fraud or
error. In making those risk assessments, we consider internal controls relevant to the preparation and fair presentation of the fi nancial report in
order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the internal controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by the Directors, as well as evaluating the overall presentation of the fi nancial report.
We believe that the audit evidence we have obtained is suffi cient and appropriate to provide a basis for our audit opinion.
Independence
In conducting our audit we have met the independence requirements of the Corporations Act 2001. We have given to the Directors of the
company a written Auditor’s Independence Declaration, a copy of which is included after the Directors’ Report.
Auditor’s Opinion
In our opinion:
1. the fi nancial report of Infomedia Ltd is in accordance with:
(a)
the Corporations Act 2001, including:
(i) giving a true and fair view of the fi nancial position of Infomedia Ltd and the consolidated entity at 30 June 2007 and of their
performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards (including the Australian Accounting Interpretations); and
(b) other mandatory fi nancial reporting requirements in Australia.
2. the fi nancial report also complies with International Financial Reporting Standards as disclosed in Note 2.
3. the remuneration disclosures that are contained on pages 20 to 25 of the Directors’ Report comply with Accounting Standard AASB 124
Related Party Disclosures.
Ernst & Young
Garry Wayling
Partner
Sydney, 22 August 2007
73 infomedia.com.au
Liability limited by a scheme approved under
Professional Standards Legislation.
Annual Report
Corporate
Governance
HOW TO READ THIS CORPORATE GOVERNANCE STATEMENT
This Corporate Governance Statement is divided into the following sections:
(cid:129) an introduction, providing an overview of Infomedia’s approach to corporate governance;
(cid:129) changes to the composition of the Board of Directors and Committees during FY2007;
(cid:129) a discussion of major corporate governance initiatives during the reporting period;
(cid:129) a discussion of the major areas where Infomedia Ltd reports under the ‘if not, why not?’ obligation; and
(cid:129) a subject based commentary on Infomedia Ltd’s approach to the ASX CorporateGovernance Council Guidelines.
INTRODUCTION
This Corporate Governance Statement, which is current as at the date of the Directors’ Report, addresses the approach adopted
by the Company to the ASX Corporate Governance Council’s Principles of Good Corporate Governance and Best Practice Recommendations1
and has been updated to refl ect the actions taken by the Company since its last annual report.
By way of background, the Board fi rst began its consideration of the ASX Corporate Governance Council Guidelines during the
course of the 2003 fi nancial year. To aid the review process, the Board made initial adjustments to the structure of its Committees
so that they comprised the Corporate Governance Committee, the Audit & Risk Committee and the Remuneration & Nomination
Committee. Each Committee was chaired by an independent Director, with its membership determined by the Board on the basis
of greatest expertise in the areas of relevance to each Committee.
Background details and meeting attendance records during FY2007 for members of each of the Corporate Governance, Audit &
Risk and Remuneration & Nomination Committees are set out in the Directors’ Report.
The Board continues to endorse the ‘if not, why not?’ framework adopted by the ASX Corporate Governance Council. However,
in the last quarter of FY2007, almost exactly three years after the Company initially began implementing relevant ASX CGC
Recommendations, the Board requested that the Remuneration & Nomination Committee revisit the question of how the Company
could best maintain its corporate governance practices in ways that are, given the level of implementation reached, pragmatic and
appropriate to its size and available resources. These adjustments are discussed in more detail in the section headed ‘Changes to
the Composition of the Board of Directors and Committees’ below.
The material set out in this Corporate Governance Statement has been prepared in accordance with the ASX Listing Rules and,
in particular, the various ‘Guide(s) to reporting...’ included in the ASX CGC Recommendations. Unless otherwise indicated, the
ASX CGC Recommendations were in place for the whole fi nancial year.
CHANGES TO THE COMPOSITION OF THE BOARD OF DIRECTORS AND COMMITTEES
In early 2007 the Company announced that Mr Geoffrey Henderson had tendered notice of his intention to resign, due to
overseas family commitments, as a Non-executive Director of the Board with effect from 28 February 2007. Mr Henderson had
served on the Board of Directors since February 2003 and occupied several Board Committee positions, including Chairman of
the Corporate Governance Committee. The Company then commenced searching for a suitably qualifi ed replacement, and in the
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interim, Mr Richard Graham was appointed as acting Chair of the Corporate Governance Committee.
In June 2007, upon the recommendation of the Remuneration & Nomination Committee, the Board approved a number of
changes to the structure, composition and responsibilities of the Board itself and its Committees. The Board canvassed various
options regarding Board and Committee composition, function and responsibility.
After some discussion, which focussed on the importance of the audit aspect of the Audit & Risk Committee’s work and which also
noted the fi rm establishment of the Company’s corporate governance charters, policies and practices, the option of amalgamating
the Audit & Risk Committee and the Corporate Governance Committee emerged with strong support. The Board also approved
the re-absorption of the remuneration and nomination functions, with the Board to utilise the support of Ms Frances Hernon as
Lead Non-executive Director for all matters that formerly fell within the ambit of the Remuneration & Nomination Committee.
To coincide with the Company’s fi nancial year and reporting obligations, these changes took effect from 1 July 2007, with the
exception of Ms Hernon’s appointment to the Audit & Risk Committee, which was effective from 25 June 2007.
The re-named ‘Audit, Risk & Governance Committee’ comprises:
(cid:129) Andrew Moffat (Chair);
(cid:129) Myer Herszberg; and
(cid:129) Frances Hernon.
At that same June 2007 meeting, the Board also resolved to suspend its search for a suitably qualified replacement for
Mr Henderson.
Given their effective date, these changes will be the subject of further discussion in the FY2008 Corporate Governance Statement.
MAJOR CORPORATE GOVERNANCE INITIATIVES
During the reporting year, the Board continued, through the appropriate Committee, to monitor the charters, policies and
procedures adopted by the Company in support of the ASX CGC Principles and remains satisfi ed that the Company’s corporate
governance practices are consistent with the spirit and intent of the ASX Corporate Governance Council Guidelines. The
Company continued, as it had since 2004, to engage a part-time external consultant whose primary role is to facilitate the
Company’s corporate governance initiatives.
In FY2006, the Corporate Governance Committee entrenched the rolling review process it had introduced in FY2005, under
which the Company’s various corporate governance documents, and in particular the various policies, are reviewed and refi ned.
Briefl y, the process involves:
(cid:129)
selecting a corporate governance document and taking a ‘snapshot’ of its effectiveness by examining, through sounding
a randomly selected representative sample of employees, how well the existence, purpose and operating framework of that
corporate governance document is understood;
(cid:129)
reporting the outcome of the sounding process to the Corporate Governance Committee, along with any recommendations; and
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(cid:129) Senior Management implementing those recommendations adopted (for example publishing summary documents, increasing
employee awareness through further education sessions, improving access to corporate governance documents by establishing
a governance page on the Company’s website and including certain governance documents in employee induction packages).
The Performance Evaluation and Remuneration Policy is currently being reviewed in accordance with this process. In a separate
exercise, the Audit & Risk Committee and Board Charters are also in the process of being amended to refl ect the changes to
the Board and Committee structures noted above. As with last year, once again representatives from both the Audit & Risk
Committee and the Corporate Governance Committee worked together with Senior Management to examine the effectiveness
of Infomedia’s risk management initiatives. This process once again bridged the gap between the FY2007 Risk Management Plan
and the FY2008 Risk Management Plan. The FY2008 Risk Management Plan was considered and, as appropriate, approved by
both the Audit & Risk Committee and the Board in June and August 2007 (respectively).
In May 2006, the Remuneration & Nomination Committee, with some assistance from external consultants, turned its attention
to establishing the framework for the fi rst formal ‘whole of Board’ review. At the 23 August 2006 Board meeting, the Chair of the
Remuneration & Nomination Committee, Ms Hernon, provided an overview of the key fi ndings – the major one being that the
Board regarded itself as meeting needs/performing well in most areas.
In December 2006, the Remuneration & Nomination Committee reported more formally to the Board, identifying areas for
improvement and suggested actions for improved performance. A number of the recommendations contained in the Remuneration
& Nomination Committee’s report have already been adopted, including:
(cid:129)
(cid:129)
scheduling dedicated Board sessions to further develop strategy and people; and
formalising the Company’s director development program through Australian Institute of Company Directors (AICD)
memberships and continuing director education.
At its 24 and 25 May 2006 meeting, the Board considered recommendations from the Remuneration & Nomination Committee
regarding changes to the remuneration of the Company’s Non-executive Directors. The Remuneration & Nomination Committee’s
recommendations were based around independent external advice and survey data which revealed increases in both individual
Non-executive Director fees and maximum Non-executive Director fee pools.
Data in respect of non-executive directors included that: (i) for the companies with smaller market capitalisation, median total
remuneration for non-executive directors was around $67,000 and for their non-executive chair around $120,000; and (ii) the medium
fee level per committee membership was approximately $8,750 whilst for chairing a committee it was approximately $15,000.
At that meeting, the Board acknowledged that the increased time commitments and responsibilities of Non-executive Directors,
coupled with the fact that Non-executive Director remuneration had not been reviewed for a number of years, rendered an upward
remuneration review appropriate. Further benchmarking was then obtained and in late July 2006 the Board approved, with effect from
1 July, an increase in Non-executive Director remuneration, more detail in respect of which may be found in the Directors’ Report.
The summaries of the Company’s various charters, policies and procedures included on Infomedia’s website have been updated
as required by the Board and Committees’ ongoing review process.
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‘IF NOT, WHY NOT?’
ASX CGC Recommendation 2.1 – A majority of the board should be independent directors
ASX CGC Recommendation 2.2 – The chairperson should be an independent director and
ASX CGC Recommendation 2.3 – The roles of chairperson and chief executive should not be exercised by the same individual
Traditionally, the Board has applied an Executive Director/Non-executive Director classifi cation to its members. Until the resignation
of Mr Henderson as a Non-executive Director in February 2007, the Infomedia Board comprised fi ve Non-executive Directors and
one Executive Director. Since then the Board has comprised four Non-executive Directors and one Executive Director.
The role of Chairman and Chief Executive Offi cer has, as contemplated by ASX CGC Recommendation 2.3, been split since
31 December 2004. However, having retired within the past three years as an executive, Mr Richard Graham is not considered
by the Board as an independent Chairman. Accordingly, the Company does not comply with ASX CGC Recommendation 2.2
that the chairperson be an independent director. Nevertheless, the Board remains of the view that its independence as a whole is
not compromised and that it is in the best interests of the Company for Mr Graham to continue as Chairman. The Board believes
that during this stage of growth, Infomedia is best served by keeping a strong focus on the development and implementation
of strategic platforms. It believes that Mr Graham’s industry knowledge, both technological and automotive, uniquely positions
him for the kind of strategic thinking required of the Chairman. As suggested in the commentary accompanying ASX CGC
Recommendation 2.2, under the Board Charter, Board members may elect a lead Non-executive Director to chair informal
discussion meetings of Non-executive Directors.
Mr Gary Martin, in his role as Director and Chief Executive Offi cer, is also not considered by the Board as independent. However,
two of the Company’s continuing Directors, Ms Hernon and Mr Andrew Moffat, meet an objective assessment of quantitative
and qualitative criteria for independence. A third Non-executive Director, Mr Myer Herszberg, whilst being a major shareholder,
is considered by the Board, having regard to the quantitative, qualitative and cumulative criteria, to operate independently and
objectively.
The Board is fi rmly of the view that good, or sound, leadership and judgement and ethical practice are driven by the culture of
an organisation, not process. Infomedia has long had a strong and well developed informal culture of corporate governance and
compliance. Originally grounded in proprietary company roots, this culture has now become more formalised as is appropriate
for a publicly listed company.
The Board’s approach fi nds support in this view in other corporate governance commentary, including in the observations of
the Royal Commissioner, Mr Justice Owen, who in his offi cial report into the collapse of HIH stated that the critical issue is
not so much whether, on objective criteria, the director is independent but rather whether he or she is subjectively capable of
exercising independent judgement. Mr Justice Owen also said that, “...I am not convinced that a mandatory requirement for
boards to have a majority of non-executive directors is either necessary or desirable. In most cases it will be desirable (assuming
the non-executive directors are truly independent) but fl exibility ought to be maintained to enable corporations to be structured
in a way that best suits their circumstances”.
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Accordingly, the Board believes it comprises a majority of independent Directors and so complies with ASX CGC Recommendation 2.1.
This independence will continue to be reviewed periodically by the Board to ensure its continued good practice in this area.
Ultimately, however, the Board accepts that its members remain in offi ce upon the vote of the Company’s shareholders and that
they may elect members to the Board regardless of their standing, independent or otherwise.
In order to facilitate the discharge of their duties, including in respect of independent decision making, the Board confi rmed in
April 2004 its policy for Directors obtaining independent professional advice at the expense of the Company.
COMMENTARY
The Board and Senior Management – Structure and Remuneration
ASX CGC Principle 1 – Lay solid foundations for management and oversight
Recognise and publish the respective roles and responsibilities of board and management
ASX CGC Principle 2 – Structure the board to add value
Have a board of an effective composition, size and commitment to adequately discharge its responsibilities and duties
ASX CGC Principle 8 – Encourage enhanced performance
Fairly review and actively encourage enhanced board and management effectiveness
ASX CGC Principle 9 – Remunerate fairly and responsibly
Ensure that the level and composition of remuneration is suffi cient and reasonable and that its relationship to corporate and individual performance is defi ned
The Company’s Constitution requires a minimum of three and a maximum of seven Directors, of whom at least two must ordinarily
be resident in Australia. Under the Company’s Constitution, one third of the Directors, and any other Director not in such one
third who has held offi ce for three years or more, other than the Chief Executive Offi cer, must retire by rotation each year. If
eligible, the retiring Directors may offer themselves for re-election.
The Infomedia Board currently comprises fi ve Directors and details of the names, terms of offi ce, Committee memberships,
meeting attendance record, skills, experience and expertise of each, along with photographs, appear in the Directors’ Report.
Since listing on the ASX in August 2000 in particular, the composition and size of the Infomedia Board has been shaped by its
Constitution and the contribution Directors are able to make, both individually and collectively. An emphasis has been, and through
the interaction of the Board and the Remuneration & Nomination Committee, placed on promoting, among other attributes, an
appropriate mix of relevant skills, independence, expertise, business knowledge and executive and non-executive participation.
Changes to the Board and Committee composition impacting FY2008 are discussed under the heading ‘Changes to the
Composition of the Board of Directors and Committees’ above.
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ASX CGC Recommendation 1.1 – Formalise and disclose the functions reserved to the board and those delegated to management
A formal Charter of the Board of Directors was adopted in early July 2004, following careful and considered deliberation by both
the Corporate Governance Committee and the Board itself. The priority was to document an appropriate division of Board and
management responsibilities. The Board’s focus is on the Company’s objectives, determining the strategy for achieving those
objectives and setting the overall policy framework within which the business of the Company is conducted whilst ensuring that
the Company operates in accordance with good management and governance practices.
The Corporate Governance Committee was established following the introduction of the ASX Corporate Governance Council’s
Principles of Good Corporate Governance and Best Practice Recommendations to support the Board in the areas not covered by the Audit &
Risk and Remuneration & Nomination Committees.
ASX CGC Recommendation 2.1 – A majority of the board should be independent directors
ASX CGC Recommendation 2.2 – The chairperson should be an independent director and
ASX CGC Recommendation 2.3 – The roles of chairperson and chief executive should not be exercised by the same individual
Commentary on these three ASX CGC Recommendations is found under the heading ‘If Not, Why Not?’ above.
ASX CGC Recommendation 2.4 – The board should establish a nomination committee and
ASX CGC Recommendation 9.2 – The board should establish a remuneration committee
Upon the recommendation of the Remuneration & Nomination Committee, in April 2004 the Board adopted an amended
Remuneration & Nomination Committee Charter.
The Remuneration & Nomination Committee and the Board, as appropriate, consider all Board nominees, having regard to
both the nominee’s individual merits and overall Board composition. In each case the recommendations of the Remuneration &
Nomination Committee are then endorsed by the Board and then by shareholders upon the recommendation of the Board.
The Remuneration & Nomination Committee formalised a policy for the nomination and induction of Directors, which was
adopted by the Board in early July 2005. A summary of the Director Nomination & Induction Policy was then made available on
the Infomedia website. In preparing the Director Nomination & Induction Policy, regard was had to the ASX CGC Commentary
accompanying ASX CGC Recommendation 8.1 and, in particular, the suggestions for an induction program. Both Mr Martin and
Mr Moffat were inducted as Directors of Infomedia under the guidance of the Remuneration & Nomination Committee and in
accordance with the Director Nomination & Induction Policy.
ASX CGC Recommendation 8.1 – Disclose the process for performance evaluation of the board, its committees and individual directors and
key executives
ASX CGC Recommendation 9.1 – Provide disclosure in relation to the company’s remuneration policies to enable investors to understand (i) the costs and
benefi ts of those policies and (ii) the link between remuneration paid to directors and key executives and corporate performance
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Upon recommendation of the Remuneration & Nomination Committee, a Remuneration & Performance Evaluation Policy for
Directors and Senior Executives was adopted by the Board in July 2004. The Policy clearly outlines the criteria for assessing
the performance of the Board as a whole, the Directors as individuals, the Chairman of the Board and the senior executives,
and aims to provide a framework for structuring total remuneration that will facilitate both the short and long term growth
and success of the Company, that is competitive with the market place and that is demonstrably linked to the Company’s
overall performance as discussed more fully in the Remuneration Report included within the Directors’ Report. In preparing the
remuneration information contained in the Remuneration Report, regard was had to the ASX CGC Commentary accompanying
ASX CGC Recommendation 9.1 and, in particular, the suggestions for disclosure in box 9.1. Commentary on the work undertaken
during this and the preceding reporting period by the Remuneration & Nomination Committee regarding a ‘whole of board’ self-
assessment is found under the heading ‘Major Corporate Governance Initiatives’ above.
ASX CGC Recommendation 9.3 – Clearly distinguish the structure of non-executive directors’ remuneration from that of executives
In formulating the Remuneration and Performance Evaluation Policy for Directors and Senior Executives, regard was had to both market
practice and to the best practice guidance provided in the ASX CGC Commentary accompanying ASX CGC Recommendation 9.3.
In contrast to Executive Directors, Non-executive Directors are remunerated by way of fees and statutory superannuation
contributions only: they do not receive any additional retirement benefi ts and nor do they currently participate in any of the
Company’s incentive arrangements. Non-executive Directors have previously received options, but this practice was reconsidered
with the introduction of the Remuneration and Performance Evaluation Policy for Directors and Senior Executives in FY2004, as
a result of Remuneration & Nomination Committee discussion on ASX CGC Recommendation 9.3 and the accompanying ASX
CGC Commentary. The Company will continue to monitor the issue as it recognises that for smaller companies option based
remuneration may be an appropriate method of remunerating Non-executive Directors when accompanied by an appropriate
framework and proper disclosure.
ASX CGC Recommendation 9.4 – Ensure that the payment of equity based executive remuneration is made in accordance with thresholds set in plans
approved by shareholders
The Company has two equity based incentive plans: an Employee Option Plan, applicable to certain eligible employees, including
senior executives and Executive Directors and an Employee Share Plan, applicable to all permanent employees of one or more
years of service, including senior executives but excluding both Executive and Non-executive Directors. These plans were
established prior to Infomedia’s listing in August 2000 in accordance with both the Corporations Act and the ASX Listing Rules
and were disclosed in the 14 July 2000 prospectus. As a result of the altered accounting treatment required under the Australian
equivalents to International Financial Reporting Standards, in June 2005 the Board resolved to indefi nitely suspend the Employee
Share Plan with effect immediately following the scheduled July 2005 allocation.
Given this background, there is no present intention to obtain shareholder approval of the Employee Option Plan (or, if
re-activated, the Employee Share Plan) as proposed by ASX CGC Recommendation 9.4 unless otherwise required by the
Corporations Act and/or the ASX Listing Rules.
Further detail of senior executive remuneration under these plans is included in the Remuneration Report.
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Business Conduct
ASX CGC Principle 3 – Promote ethical and responsible decision making
Actively promote ethical and responsible decision making
ASX CGC Principle 10 – Recognise the legitimate interests of stakeholders
Recognise legal and other obligations to all legitimate stakeholders
ASX CGC Recommendation 3.1 – Establish a code of conduct to guide the directors, the chief executive offi cer and any other key executives as to:
3.1.1 the practices necessary to maintain the confi dence in the company’s integrity
3.1.2 the responsibility and accountability of individuals for reporting and investigating reports of unethical practices and
ASX CGC Recommendation 10.1 – Establish a code of conduct to guide compliance with legal and other obligations to legitimate stakeholders
A formal Code of Conduct was adopted in April 2004 following careful and considered deliberation by both the Corporate
Governance Committee and the Board itself.
The Infomedia Code of Conduct applies to all Infomedia personnel, including Directors, senior executives and employees and
was developed having regard to the ASX CGC Commentary accompanying ASX CGC Recommendations 3.1 and 10.1. Whilst
Infomedia has long held and emphasised personal integrity, respect and ethical business practices as core tenets, the Infomedia
Code of Conduct strengthens the Company’s commitment to them by further articulating the cultural values which permeate the
Company and better guiding dealings with all non-shareholder stakeholders.
Under the direction of the Corporate Governance Committee, the Code of Conduct was refi ned during FY2006, primarily to
formalise guidelines for the resolution of internal grievances. The soundings conducted as part of the review process served to
promote greater awareness and use of enhanced procedures for seeking guidance where areas of concern exist, for the management
of grievance issues and for the notifi cation of matters which potentially involve a compliance or business risk element.
The implications of the Work Choices legislation for Infomedia’s employees were the subject of an Australia wide joint presentation
by the Human Resources Manager and the Chief Executive Offi cer in FY2006. The ‘face to face’ approach was designed to
alleviate any concerns employees may have had regarding loss of entitlements or benefi ts. The presentations were both well
attended and warmly received, particularly in light of the negative publicity surrounding the introduction of the legislation.
In FY2006, Infomedia voluntarily took part in the University of Technology, Sydney (UTS) – Centre for Corporate Governance
Research Project on The changing roles and responsibilities of company boards and directors. This involved the General Counsel/Company
Secretary participating in a one on one interview during which Infomedia’s response was canvassed to some 42 questions drawn
largely from the 10 principles and 28 recommendations which comprise the ASX Corporate Governance Council Guidelines.
This involvement allowed the Company to demonstrate its willingness to be a part of the wider corporate governance community
and provided an invaluable opportunity to undertake a self-assessment of the corporate governance work it had done to date. In
addition, as the UTS – Centre for Corporate Governance Research Project moved toward fi nalising its June 2006 Interim Report,
the Corporate Governance Committee sought out Infomedia specifi c feedback from the UTS Centre for Corporate Governance
regarding the perceived effectiveness of its corporate governance initiatives.
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ASX CGC Recommendation 3.2 – Disclose the policy concerning trading in company securities by directors, offi cers and employees
A formal Policy on Share Trading by Company Directors, Offi cers and Employees was originally established in October 2001
and was reviewed, amended and adopted by the Infomedia Board in April 2004, upon the recommendation of the Corporate
Governance Committee. It was further reviewed by the Corporate Governance Committee as part of its review calendar and,
in turn by the Board, in the last quarter of FY2005. In July 2005, a revised Policy on Securities Trading by Company Directors,
Offi cers and Employees was adopted by the Board and a summary was placed on the Company’s website.
Financial Reporting and Risk Management
ASX CGC Principle 4 – Safeguard integrity in fi nancial reporting
Have a structure to independently verify and safeguard the integrity of the company’s fi nancial reporting
ASX CGC Principle 7 – Recognise and manage risk
Establish a sound system of risk oversight and management and internal control
During this reporting period Infomedia complied with the ASX CGC Recommendations accompanying ASX CGC Principle 4,
relating to audit committee composition, operation and responsibility. Following Mr Henderson’s resignation, the Board appointed
Ms Hernon to the Audit & Risk Committee.
ASX CGC Recommendation 4.1 – Require the chief executive offi cer and the chief fi nancial offi cer to state in writing to the board that the company’s fi nancial
reports present a true and fair view, in all material respects, of the company’s fi nancial condition and operational results and are in accordance with relevant
accounting standards and
ASX CGC Recommendation 7.2 – The chief executive offi cer (or equivalent) and the chief fi nancial offi cer (or equivalent) should state to the board in writing that:
7.2.1 the statement given in accordance with best practice recommendation 4.1 (the integrity of fi nancial statements) is founded on a sound system of risk
management and internal compliance and control which implements the policies adopted by the board
7.2.2 the company’s risk management and internal compliance and control system is operating effi ciently and effectively in all material respects
The Company’s fi nancial reporting obligations for FY2007 have been fulfi lled, as they have in previous years, in accordance with
applicable legal and accounting requirements: see the fi nancial statements and notes contained in the Directors’ Report and the
independent Audit Report.
Having acted in accordance with the Board endorsed revised Risk Management Policy and Board endorsed Risk Management
Plan, the Chief Executive Offi cer and the Chief Financial Offi cer have provided to the Board the certifi cations under ASX CGC
Recommendation 7.2 and in turn, the certifi cations under ASX CGC Recommendation 4.1. and the Corporations Act.
ASX CGC Recommendation 4.2 – The board should establish an audit committee
ASX CGC Recommendation 4.3 – Structure the audit committee so that it consists of only:
• non-executive directors;
• a majority of independent directors;
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• an independent chairperson, who is not chairperson of the board; and
• at least three members.
ASX CGC Recommendation 4.4 – The audit committee should have a formal charter
Infomedia originally established an audit committee prior to its listing on the ASX in August 2000. The Board continues to fi rmly
believe the Audit & Risk Committee is of ‘...suffi cient size, independence and technical expertise to discharge its mandate effectively’.
As noted in the discussion around ASX CGC Recommendation 2.1 above, although traditionally the Board has applied an Executive
Director/Non-executive Director classifi cation to its membership, the Board believes that the Audit & Risk Committee’s members
meet an objective assessment of quantitative and qualitative criteria for independence. Therefore, the Committee meets the
requirements for an independent Chairman and a majority of independent Directors under ASX CGC Recommendation 4.3.
A formal Audit & Risk Committee Charter was originally adopted in 2000 and an amended version approved by the Board in
April 2004 following careful and considered deliberation by both the Audit & Risk Committee and the Board itself. Consistent
with the Company’s policy, a summary of the Charter was placed on the Company’s website during FY2005.
In response to both legislative change and to the ASX CGC Commentary, in FY2004 the Audit & Risk Committee began
reconsidering the policy for the selection and appointment of the Company’s external auditor and the rotation of engagement
partners and during FY2006 the Committee recommended, and the Board approved, formalised procedures, and made a
summary of them available on the Infomedia website. The Audit & Risk Committee acknowledges the importance of external
auditor independence. The Company’s external auditor’s engagement partner was rotated in FY2007.
ASX CGC Recommendation 7.1 – The board or appropriate committee should establish policies on risk oversight and management
Upon the recommendation of the Audit & Risk Committee, the Board adopted the Risk Management Policy in July 2004. During
the FY2006 reporting period, the Audit & Risk Committee reviewed it closely and recommended that the Board adopt a revised
Risk Management Policy and a Risk Management Plan which would better promote the establishment and implementation of an
effective and appropriate risk management framework for the Company.
The revised Risk Management Policy allocates oversight responsibility to the Board and the Audit & Risk Committee whilst the
establishment of risk management procedures, compliance and control rests with the Chief Executive Offi cer, Chief Financial
Offi cer and Senior Executives and, at a daily operating level, with departmental managers, line managers and individuals as part
of regular business conduct.
Work undertaken during FY2007 examining the effectiveness of Infomedia’s risk management initiatives is discussed under the
heading ‘Major Corporate Governance Initiatives’ above.
A summary of the Company’s Risk Management Policy is available on the Company’s website; however, given the strategic
nature of its content, the Board does not feel it is appropriate for details of the Company’s Risk Management Plan to be made
publicly available as contemplated by the guidance accompanying ASX CGC Recommendation 7.3.
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ASX CGC Principle 5 – Make timely and balanced disclosure
Promote timely and balanced disclosure of all material matters concerning the company
ASX CGC Recommendation 5.1 – Establish written policies and procedures designed to ensure compliance with ASX Listing Rule disclosure requirements and
to ensure accountability at a senior management level for that compliance
A Market Disclosure Policy was adopted by the Board in April 2004 following careful and considered deliberation by both the
Corporate Governance Committee and the Board itself. The Market Disclosure Policy was developed having regard to the ASX
CGC Commentary and suggested content accompanying ASX CGC Recommendation 5.1.
A review of the Market Disclosure Policy was conducted by the Corporate Governance Committee as part of its review calendar
in the fi nal quarter of FY2006. The review concluded that both the continuous and periodic reporting obligations imposed under
the ASX Listing Rules, and the Company’s internal procedures in respect of them, were well understood by Senior Management.
Shareholders
ASX CGC Principle 6 – Respect the rights of the shareholders
Respect the rights of shareholders and facilitate the effective exercise of those rights
ASX CGC Recommendation 6.1 – Design and disclose a communications strategy to promote effective communication with shareholders and encourage
effective participation at general meetings and
ASX CGC Recommendation 6.2 – Request the external auditor to attend the annual general meeting and be available to answer shareholder questions about
the audit
Through a series of initiatives, Infomedia continues to demonstrate its commitment to promoting effective communication with
all shareholders. Such initiatives include the continued development of the Company website, where this Corporate Governance
Statement, summaries of the various corporate governance charters, policies and guidelines, annual, half yearly and quarterly
reports, a synopsis of the Infomedia business model, media releases, achievements, share price information and the July 2000
prospectus, along with the FY2007 Notice of Annual General Meeting and Explanatory Statement are all available.
The Australian Government recently introduced legislation allowing the default option for receiving annual reports to be via a
company’s website. Shareholders will now receive timely, cost effective and more environmentally friendly online annual reports,
unless they specifi cally request a printed copy.
Infomedia has considered and adopted, as appropriate to its circumstances, the Guidelines for notices of meeting included in the
ASX CGC Commentary accompanying ASX CGC Recommendation 6.1.
Shareholder participation at general meetings is encouraged and Infomedia’s auditor, Ernst & Young, will attend the Annual
General Meeting and be available to answer shareholder questions.
1 The ASX Corporate Governance Council Guidelines containing the ASX CGC Principles, the ASX CGC Recommendations and the ASX CGC Commentary,
iiMarch 2003.
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Additional
Information
TOP 20 HOLDERS OF SHARES AS AT 30 AUGUST 2007
Name
WISER EQUITY PTY LTD
J P MORGAN NOMINEES AUSTRALIA LIMITED
YARRAGENE PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
ANZ NOMINEES LIMITED CASH INCOME A/C
NATIONAL NOMINEES LIMITED
CITICORP NOMINEES PTY LIMITED
MR ANDREW PATTINSON
BIG BEAR ENTERPRISES PTY LTD
TOM HADLEY ENTERPRISES PTY LTD
WISER CENTRE PTY LTD WISER CENTRE P/L S/F A/C
MR RICHARD GRAHAM
MR YET KWONG CHIANG MRS HO YUK LIN CHIANG
AUSTRALIAN REWARD INVESTMENT ALLIANCE
MR JOHN KENDALL PERRETT
BRAZIL FARMING PTY LTD
WOODCLIFF SUPER PTY LTD
GOLD HOLDINGS PTY LTD GOLD HOLDINGS P/L S/F A/C
MR GARY JOHN MARTIN
APPLIED SENSORS PTY LTD MULLIGAN PENSION FUND A/C
Shares
% of Total
Rank
100,277,501
30.76
24,461,938
23,421,599
10,123,644
7,764,947
5,579,807
3,503,614
2,447,567
2,000,000
1,000,000
1,000,000
926,559
847,225
835,895
740,000
600,000
500,000
486,000
407,590
400,000
7.50
7.19
3.11
2.38
1.71
1.07
0.75
0.61
0.31
0.31
0.28
0.26
0.26
0.23
0.18
0.15
0.15
0.13
0.12
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Range
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001+
TOTAL
RANGE OF SHARES AS AT 30 AUGUST 2007
Shareholders
Shares held
% of total
530
2685
2079
3216
156
8666
439,237
8,714,817
17,325,139
90,156,516
209,335,863
325,971,572
0.13
2.67
5.31
27.66
64.23
100
As at 30 August 2007 there were 171 shareholders holding less than a marketable parcel of shares (minimum parcel $500.00)
85 infomedia.com.au
Annual Report
Corporate
Directory
INFOMEDIA LTD
357 Warringah Road
Frenchs Forest NSW 2086
ABN 63 003 326 243
Telephone: (02) 9454 1500
Facsimile: (02) 9454 1844
Internet: infomedia.com.au
DIRECTORS
Richard Graham – Chairman of the Board
Myer Herszberg – Non-executive Director
Frances Hernon – Non-executive Director
Gary Martin – Chief Executive Offi cer and Executive Director
Andrew Moffat – Non-executive Director
COMPANY OFFICERS
Nick Georges – Company Secretary
Peter Adams – Chief Financial Offi cer
AUDITOR
Ernst & Young
Ernst & Young Centre
680 George Street
Sydney NSW 2000
SHARE REGISTRY
Computershare Registry Services Pty Ltd
GPO Box 7045
Sydney NSW 1115
LAWYERS
Thomson Playford Lawyers
Level 25 Australia Square Tower
264 George Street
Sydney NSW 2000
Infomedia, Microcat and PartFinder are registered trademarks, and LIVE, MARKET, Auto PartsBridge and Superservice Menus
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