ANNUAL
REPORT
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J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ABN: 80 009 116 269
CONTENTS
Letter from the Chair
CEO’s Address
Who We Are
Unique Value Propositions
KWB Group Commentary
Bedshed Commentary
Board of Directors
Company Secretaries
Consolidated Financial Reports
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J O Y C E C O R P O R A T I O N L T D
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LETTER FROM
THE CHAIR
Through a challenging operating
environment, Joyce Corporation has again
demonstrated its resilience and potential,
delivering a strong operational and financial
performance in 2022.
Although homeowners, looking to add
value to their most important asset,
created strong demand for our products,
our businesses had to manage supply
chain interruptions, and disruptions for our
customers and staff caused by COVID-19.
They did so adroitly.
We have been able to adapt to this
environment because we are an inherently
resilient business, with strong financial
foundations and with a capable leadership
team that has been quick to anticipate and
respond to challenges as they arise.
KWB continues to be our cornerstone
business and again delivered outstanding
returns to Joyce Corporation with
increased revenue and earnings.
In response to changing market conditions,
KWB continued to grow its network
of showrooms but slowed the pace of
the expansion, deferring two new store
openings. We only open new stores where
we can be confident that we can deliver
on our promise to customers. With supply
chains constrained and labour markets
tight, it was expedient to divert some
expansion funds into upgrading existing
showrooms, improving their productivity
and sales conversion. This initiative will
continue into the 2023 financial year.
KWB is a ‘capital light’ business model and
with strong margins and excellent cash
flow I am confident it will continue to grow,
particularly given the great organic growth
potential across Australia.
Bedshed’s continued success and future
growth is driven by our franchisees.
Bedshed is a true Australian small to
medium business success story. Our
partnership with Bedshed franchisees
has produced dozens of family business
success stories across Australia, along with
healthy earnings to Joyce shareholders.
Our franchisees are customer-focused,
hardworking and loyal. I am pleased
to report that we had a 100% renewal
success rate with seven franchises electing
to continue with us by renewing their
agreements in the Financial Year. We also
have a healthy pipeline of potential new
franchisees that want to join the Bedshed
and Joyce family.
Financially, our Company ended the 2022
reporting year with a stronger balance
sheet and an improved cash position,
thanks to improved earnings from KWB
Group and Bedshed Franchised Operations,
and the sale of our office and warehouse
in Osborne Park.
This provides the Company with a solid
platform to deliver both consistent earnings
and future growth and has enabled the
Board to resolve to pay an increased final
year dividend to shareholders of 10.5 cents
per share. This results in a record full year
dividend of 18 cents which is in line with
our stated intentions announced in 2021 of
aiming for full year dividend payments of
between 60-80% of normalised NPAT.
The Board and Executive Team have
focused our strategy for the future. With
the KWB Group and Bedshed, Joyce has
established brands that are synonymous
with helping Australians add value to their
greatest asset – the family home – the
sector on which we are concentrating.
There are significant, low-capital growth
opportunities for our businesses across
Australia, as we demonstrated last year
with both the successful expansion of the
KWB showroom footprint and Bedshed’s
entry into the Sydney market. We will
continue that approach, being mindful
of our capacity to deliver in the current
economic environment.
A key initiative in implementing this
strategy is the launch of our home staging
business – Crave – starting next month
as a pilot in the Perth Real Estate market.
Crave leverages our understanding of the
needs of homeowners and builds on our
core capabilities by utilising and leveraging
our market knowledge, supply chain access,
marketing expertise, logistics and industry
relationships.
Requiring only modest capital, funded by
part of the proceeds from the sale of our
Osborne Park premise, we believe Crave can
be an important strategic addition to our
businesses by tapping into an emerging but
substantial, under-serviced market segment
with significant growth potential.
To be able to take advantage of such
opportunities we needed to bolster Joyce’s
management capacity and I welcome Gavin
Culmsee to his new role of COO, and the
operational and retail expertise he brings to
the Joyce Executive Team.
Nick has deep retail business experience
and proven executive, advisory, operational
and strategic credentials. We look forward
to his contribution to the Board and the
Company more broadly.
Tim Hantke has advised the Board he will be
retiring from his position as a Director of the
Company during this financial year. Having
joined Joyce as a Director in 2006, Tim
has made invaluable contributions to the
Company through periods of success and
challenges and has been integral to setting
the Company on its current trajectory.
Chris Palin retired from Executive Finance
Director of KWB on 1 July 2022. I thank him
for his important contribution over the years
having played a key role in the growth and
development of the KWB business. Chris
will continue to provide important oversight
and guidance of KWB as a Non-Executive
Director of KWB.
Although significant risks continue in
the broader economy, we enter the next
financial year confidently. With a strong
balance sheet, profitable businesses
providing high returns on capital and a
dedicated quality team, I believe we are
soundly positioned.
Our businesses rely on positive customer
experiences, and this comes from great
people, whether they are the franchisees
of Bedshed, or our employees at our
Company-Owned Bedshed stores, our KWB
Group business partners and staff, and
their suppliers and contractors. On behalf
of the Board, I sincerely thank everyone
connected with Joyce Corporation for their
contribution to our result.
I also thank my fellow Directors for their
commitment, wisdom and challenge
throughout the year. To that I add my thanks
to the Executive Team led by our CEO, Dan
Madden, who in his second year in the job
is bringing strong values-based leadership
and consistency. I also want to recognise
John Bourke and the team at KWB for their
dedication and hard work in what has been
a challenging operating environment.
Finally, I thank Joyce Corporation’s
shareholders. We appreciate your ongoing
support and I look forward to reporting to
you again in 2023.
We have also strengthened our Board by
welcoming Nick Palmer as a Non-Executive
Director, commencing 1 September 2022.
Jeremy Kirkwood
Chair
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ANNUAL REPORT FY22JOYCE CORPORATION LTD CEO’S ADDRESS
In 2022 our business displayed its
true colours. Against a backdrop
of supply chain challenges, labour
constraints, COVID-19 interruptions
and rising costs, Joyce Corporation
delivered increased revenue, a strong
profit result and our highest ever
dividend for shareholders.
It is a result I am very proud of,
but one on which I am sure we can
improve. That improvement can be
found by focusing on strategically
growing our existing businesses in
the right locations and by applying a
disciplined and sensible approach to
evolving to operate in new, adjacent
areas, which we are doing with
our home staging business, Crave,
launching in a pilot phase.
Our financial performance was built
on $129m in revenue, a 16% increase
over the previous year. Both KWB
Group and Bedshed capitalised
on strong demand as the trend of
homeowners seeking to add value to
their homes continued. EBITDA of
$32.2m was also up 33% on 2021,
which led to a Group NPAT of $17.6m.
The net profit attributable to Joyce
shareholders was $9.1m, which was
up on the $7.6m achieved in 2021.
This difference is primarily attributed
to; a gain on revaluation of our
investment property in Lytton,
Queensland, the early establishment
costs of our investment in Crave, the
write-back of a deferred tax asset to
a tax expense resulting from the sale
of our Howe St Property in WA, and
the inclusion in 2021 of a one-off
profit from the sale of the Bedshed
Company-Owned Helensvale store.
After adjusting for these factors the
normalised net profit attributable to
Joyce shareholders in the current
year reduced to $7.5m versus the
prior comparative of $7.2m.
The Company is in a very sound
financial position. As of June 30,
Joyce Corporation was debt free,
with cash on hand of $31.9m, having
generated an Operating Cashflow for
the financial year of $25.7m (inclusive
of lease payments, excluding tax
payments).
Our financial performance enabled us
to pay a final fully franked dividend
of 10.5 cents per share, which is a
new high for Joyce shareholders and
takes our full year dividend for FY22
to 18 cents.
Our business is driven by delivering
exceptional products and service
to our customers. We do that
through our partners in KWB Group,
our Bedshed franchisees, and our
employees (who run our Company-
Owned Bedshed stores), all of whom
maintain the Group’s strong, highly
recognisable and trusted brands.
KWB Group Financial Results
KWB Group remains a cornerstone
asset for Joyce and once again
continued its growth trajectory,
generating record revenue and EBIT.
Orders continued to grow year on
year converting to revenue of $108m,
a 21% increase on prior year.
During the year the KWB Group
investment property was revalued
resulting in a gain on revaluation of
$6.4m. Excluding the revaluation,
Operating EBIT stood at $19.2m,
an 18% increase on the prior year
comparative.
Pleasingly the KWB Group’s order
book at the end of the financial year
stood in excess of $60m reflecting
strong demand for our product
offering and placing us well for the
forthcoming financial year.
KWB’s performance was exceptional
under the circumstances, which
included supply chain disruption,
severe rainfall events that affected
showroom availability, labour
shortages and the ongoing impact
of the COVID-19 pandemic on staff,
suppliers and customers.
New store openings continued, but
were deliberately slowed, as the KWB
Group focused on absorbing supply
chain constraints and ensuring it
maintained delivery of a premium
customer experience across existing
operations before undertaking further
expansion. Although expansion was
slowed, showrooms were opened at
Penrith and Belrose in metropolitan
Sydney during the year and a full
refurbishment of the Newcastle
showroom was completed.
Following the August 2022 opening
of the Casula showroom in Sydney,
the focus will now shift into
upgrading existing showrooms,
to further enhance customer
conversion and productivity.
While kitchens remain the core
business of KWB, wardrobe design
and installation capability, currently
available in Queensland and South
Australia, also grew during the
year and is something that will be
strengthened in future years.
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maximise their home’s value at the
time of sale. Crave will provide a
sophisticated offering to the home
staging space by utilising our supply
chain access, marketing expertise,
logistics and industry relationships
to deliver a seamless service to home
sellers and Real Estate Agents.
Crave has a modest capital
requirement and has been funded
by part of the proceeds from the
sale of our Osborne Park premises
earlier in the financial year, thereby
ring-fencing the allocated capital to
the opportunity and managing the
downside risk. Further allocation of
capital from the sale proceeds will be
dependent on the success of the pilot
program and cashflow from existing
operations will not be diverted to the
new opportunity.
It is an achievement by all involved
to take Crave from concept to reality
in less than 12 months. In doing
this, we have taken a measured
approach that has included extensive
market and consumer research,
comprehensive business planning and
the development of a detailed brand
and marketing strategy.
Crave is a natural fit to our portfolio
and we anticipate it will be the first
step in the development of a new
brand with strong growth potential
and longer term opportunity for
Joyce to expand into close, adjacent
and natural opportunities.
Bedshed Financial Results
Bedshed continued to maintain its
excellent operational performance
while delivering on its franchisee
network growth ambitions.
The franchise network again grew
with three new stores opened in
NSW at Alexandria, Tuggerah and
Rutherford in the financial year.
Bedshed also maintained its excellent
record of long-term relationships
with franchisees, with all franchisees
up for renewal recommitting to the
network during the year. Being the
first brand in the Homewares and
Furniture category to achieve a
5-star rating on Australian Franchise
Rating Scale™ was an incredible
achievement, a credit to the Bedshed
team and deserved recognition of the
strength of the franchise network.
Franchisee operations performed
well, generating increased revenue of
$5.3m compared to $4.8m in the prior
year, and delivering an EBIT margin of
53% versus 54% in prior year.
Bedshed’s Company-Owned stores
traded strongly and generated $15.7m
of revenue compared to $16.7m in the
prior year. EBIT of $1.9m compared
to $3.3m in the prior year.
Company-Owned store results in
FY21 included results generated by
the Helensvale store, which was sold
to a franchisee in December 2020.
The disposal also generated a
one-off $0.5m profit before tax.
The overall FY22 Company-Owned
store EBIT margin was impacted
by the Sydney e-store, which was
established during FY21 as a
low-cost initiative to build brand
awareness to support the long-term
goal of establishing a franchise
network across Sydney.
After successfully introducing the
Bedshed Brand to NSW, the e-store
has now been closed to allow the
franchise network to grow.
After adjusting for the impact of
Helensvale and the Sydney e-store,
like-for-like Company-Owned store
revenue in FY22 of $14.4m was
comparable to prior year of $14.6m.
Adjusted EBIT for FY22 was $2.1m
versus $2.5m in prior year.
Bedshed’s combination of an
experienced team, strong supplier
relationships and brand power has
allowed the business to maintain
strong margins despite cost
pressures and we are confident we
are well positioned to continue to
perform through the ongoing rising
cost environment.
Introduction of Crave
During the year the Board and
management team signed off on our
investment in our new home staging
business, Crave, which is launching
this quarter as a pilot in the Perth
Real Estate market.
We have identified the home-staging
space as an emerging but substantial,
under-serviced market segment with
significant organic growth potential
across Australia. In the last ten
years the Australian home staging
market has more than doubled and is
becoming an increasingly meaningful
part of the substantial Australian
residential housing market which
had a value of approximately $10
trillion1 and approximately 11 million1
residential dwellings in Australia
as at March 2022.
At Crave we will leverage our
understanding of the needs of
homeowners to style and prepare
a home for sale in a way that appeals
to buyers. This will help sellers
1 Total Value of Dwellings, March Quarter 2022 | Australian Bureau of Statistics (abs.gov.au) https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/total-value-
dwellings/mar-quarter-2022
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ANNUAL REPORT FY22JOYCE CORPORATION LTD We are also excited to launch
Crave as a pilot in Perth which
has the potential to have a national
footprint and be the first step in the
development of a new brand with
strong long term growth potential.
Most importantly, we have excellent
relationships with our customers,
suppliers, business partners and
staff, all of whom deliver exceptional
customer service, which supports
the promise of our great brands.
I thank our staff and the teams
within the KWB Group and Bedshed
franchise network for their
commitment during what, at times,
has been a difficult year.
Joyce Corporation is committed to
delivering exceptional products and
service to our customers that add
value to the family home, and in 2023
we’ll be working hard to ensure our
customers and shareholders benefit
from this commitment.
Sincerely,
Dan Madden
Corporate
The Group’s consolidated closing
net cash balance stood at $31.9m
at 30 June 2022, compared to $19.9m
at 30 June 2021.
In late 2021 we entered into
an agreement to sell our Perth
Company-Owned warehouse and
office premises, generating $5.4m
in cash to be allocated towards the
establishment of Crave, funding
organic expansion within the
Joyce Group and general working
capital. Late in the financial year we
entered a new lease agreement for
a larger facility that can support our
expanded business.
Subsequent to the year end the
Group entered into an agreement
for the sale and leaseback for the
KWB corporate office and warehouse
and factory facility in Lytton,
Queensland. The sale of the Property
will realise approximately $16m in
cash (before costs) on a consolidated
basis. In connection with the sale,
KWB also entered into a leaseback
arrangement with the purchaser for
a 10 year lease for the office and
warehouse and factory space.
A long term supplier to KWB will
continue to lease approximately
60% of the Property from KWB
under a sub-lease with KWB.
Both property transactions are
aligned with the strategic direction
of the Company as we continue to
apply disciplined capital management
and build a solid platform from which
to drive our growth ambitions.
During the year we made a significant
change to our Executive Team by
promoting Gavin Culmsee to the new
position of Joyce Chief Operating
Officer. Gavin brings extensive
operational and retail experience to
the role and will support our Bedshed
operations and our new home staging
business. I look forward to continuing
to work closely with Gavin and also
with John Bourke as KWB MD and am
thankful for the skills and expertise
that they bring to the Joyce Group
as well as our CFO, Tim Allison.
Outlook
We enter FY23 with a strong balance
sheet, a high performing business,
growth opportunities and a strong
demand for our product offerings.
That is tempered by global inflationary
pressures, along with the labour
shortages and supply chain shortages
that we will continue to manage.
KWB has a strong order book and is
focused on maximising performance
from the current store network
where revenue has been artificially
reduced in FY22 due to delays and
cancellations in deliveries caused by
COVID-19. The operational network
in FY23 includes a number of
showrooms within Sydney that were
either not open or at full capacity
during FY22 and which provide year
on year growth potential.
In recent weeks, Bedshed has
opened a new franchised store
in Ballarat (VIC) and has a strong
pipeline of potential franchisees.
I am confident we will enter into
further franchisee agreements
and store openings in FY23.
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Joyce Corporation Consolidated Results
FY 22
$’000
FY 21
$’000
Variance
Variance
129,016
111,224
17,792
Revenue
Gross Profit
Total Group Expenses
Expenses (% of revenue)
EBITDA
EBITDA Margin
Net Profit After Tax
NPAT Attributable to Joyce Members
Normalised NPAT Attributable to Joyce Members
EPS – cents
Normalised EPS – cents
Joyce Corporation Consolidated Results
Closing group cash
Debt
Net cash
67,838
34,044
26%
32,208
25%
17,610
9,086
7,461
32.19
26.44
FY 22
$’000
31,933
-
58,807
30,870
28%
24,292
22%
12,995
7,574
7,238
26.92
25.72
FY 21
$’000
19,881
-
($)
9,031
3,174
n/a
7,916
n/a
4,615
1,512
223
5.27
0.71
($)
12,052
(%)
16%
15%
10%
33%
36%
20%
3%
20%
3%
(%)
61%
61%
Variance
Variance
31,933
19,881
12,052
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WHO WE ARE
Fast growing ASX-listed company
operating and invested in quality
Australian businesses
Well established and consistently
performing businesses and
partnerships with strong organic
growth potential
Committed to delivering increased
earnings while establishing a solid
platform for future growth
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J O Y C E C O R P O R A T I O N L T D
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OUR VISION
We seek to make a meaningful positive
difference to the lives of our shareholders,
partners, franchisees, employees
and customers.
PRIMARY OBJECTIVE
To drive revenue growth and deliver
above average returns.
strategic direction
“With the KWB Group and Bedshed, Joyce
has established brands that are synonymous
with helping Australians add value to their
greatest asset – the family home – this is
the sector we are concentrating on”.
J . K I R K W O O D C H A I R
UNIQUE VALUE
PROPOSITION
Working together
is key to success
sharEholders
PARTNERS
FRANCHISES
Track record of Total
Shareholder Returns.
Track record of growth and
long-term mindset.
Deep sector and operational
knowledge and supportive
growth-focused approach.
EMPLOYEES
CUSTOMERS
Ability to make an impact
growing national brands
in a supportive team
environment.
Quality products and
services, deep product
knowledge and
convenience.
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ANNUAL REPORT FY22JOYCE CORPORATION LTD FY22 BUSINESS
UNIT PERFORMANCE
SALES
107,957
89,693
67,498
64,964
59,937
FY18
FY19
FY20
FY21
FY22
NET REVENUE ($000s)
FY18 – FY22 CAGR 12.5%
EBIT
25,588
16,320
11,269
9,480
8,372
FY18
FY19
FY20
FY21
FY22
EBIT ($000s)
FY18 – FY22 CAGR 25.0%
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JOHN BOURKE
MANAGING DIRECTOR – KWB GROUP
KWB Group Commentary
KWB Group’s trading brands, Kitchen Connection and Wallspan, operate a network
of 26 showrooms across Queensland, NSW, and South Australia. KWB Group is a clear
leader in the Kitchen & Wardrobe renovation market, delivering an exceptional consumer
experience, for our customers.
KWB Group’s order book continues
to grow and was more than $60m
at the end of the fiscal year. When
coupled with our professional
management team and fantastic
product ranges, we are well
positioned to continue our long-
term trend of revenue and EBIT
growth into FY23.
John Bourke
Managing Director – KWB Group
At KWB Group we experienced
strong demand for our kitchen
and wardrobe renovation services
delivering record orders for the past
fiscal year and resulting in record
revenues and profit.
Achieving this result was not
straight forward. The Government
imposed lockdowns and COVID-19
isolation requirements had a
detrimental effect on all parts of
the business. This saw delays
and cancellations in our kitchen
and wardrobe deliveries, which
in-turn artificially reduced our
revenues. Supply chain shortages
and supplier cost increases were
closely monitored to ensure the
operating margins were protected.
These global inflationary pressures,
along with the ongoing acute labour
shortages, have been incredibly
challenging to deal with over
the past year and are impacting
the renovation and construction
sectors and many other parts
of the global economy. Additionally,
the extreme rainfall events across
NSW and Queensland affected
trading across five showrooms,
resulting in the closure of the
Windsor showroom in Brisbane.
Our people rose to the challenge,
and by collaborating with our
suppliers and customers we
were able to negotiate through
these extreme challenges and
achieve a great result. Despite
these challenges we were able
to open two new showrooms in
Sydney (Penrith and Belrose)
and commence the build on our
new Casula showroom, which
has subsequently opened after
year end. We also completed a
full refurbishment of our oldest
showroom in Newcastle, NSW.
Given the extenuating business
circumstances we are currently
operating under, a much considered
and informed decision was made
by management to pause the
opening of any new showroom
over the next 12 months. The
ongoing supply chain and labour
shortages are putting constraints
on the business that inhibit us from
delivering the exceptional service
and high standards of installation
that has made KWB Group’s brands
what they are today. Plans will now
focus our restricted resources on
the updating and refurbishment of
existing showrooms, to maximise
their customer conversion and
operating efficiency.
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ANNUAL REPORT FY22JOYCE CORPORATION LTD FY22 BUSINESS
UNIT PERFORMANCE
SALES
19,241
18,113
21,531
21,059
20,096
FY18
FY19
FY20
FY21
FY22
NET REVENUE ($000s)
FY18 – FY22 CAGR 3.1%
EBIT
2,424
1,998
5,886
4,769
3,593
FY18
FY19
FY20
FY21
FY22
EBIT ($000s)
FY18 – FY22 CAGR 19.0%
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Gavin Culmsee
MANAGING DIRECTOR – BEDSHED
Bedshed Commentary
Bedshed supplies quality bedding and home furnishings across Australia, and is one of
the industry’s most recognisable brands. This year Bedshed continued to grow its franchise
network, along with its e-commerce offering that supports our Company-Owned and
franchise stores.
Our people, including our franchisees,
are the heart and soul of Bedshed.
They have worked tirelessly in
sometimes difficult conditions in 2022
and we thank them for their hard work
and wish them well for 2023.
Gavin Culmsee
Managing Director – Bedshed
Bedshed has further expanded its
footprint in FY22 with three new
stores opened during the year in
Tuggerah, Rutherford and Alexandria
and we have recently opened
Bedshed Ballarat, bringing our
franchise network to 36 nationwide.
In addition to the new store
openings, Bedshed renewed seven
franchises during the year and were
recently awarded a 5-star rating on
Australian Franchise Rating Scale™,
the first brand in the Homewares and
Furniture category to do so. These
achievements demonstrate the
strength of the franchise system, our
commitment to transparency, and
the importance of holding franchisee
success and satisfaction as a key
priority and measure of success.
Bedshed’s second half was consistent
with first half performance and our
final result, (adjusted for the sale
of the Helensvale store in 2021) is
comparable to the previous period.
Like other businesses, the impact of
COVID-19 has challenged us in many
ways. The strength of our franchise
network has been displayed as they
worked to overcome staff shortages
without impacting the service to our
customers. The logistics of securing
products was also difficult at times,
as global supply chain costs and lead
times grew in line with other sectors.
Despite the challenges, demand was
very healthy through the year. There
are signs this trend is continuing into
the early part of 2023, and we are
well placed to meet that demand by
diversifying our overseas supplier
base and continuing to grow our
franchise network.
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ANNUAL REPORT FY22JOYCE CORPORATION LTD BOARD OF DIRECTORS
Jeremy Kirkwood
Chair
Bachelor of Commerce ANU
Jeremy was appointed a Non-Executive Director in January 2020. He has extensive experience
in corporate strategy, investment banking and global capital market and provides invaluable
strategic input and guidance to the Company’s board and management team. Jeremy is a
principal of Pilot Advisory Group and was previously a Managing Director at Credit Suisse,
Morgan Stanley and Austock. He has primarily worked in public markets, undertaking merger
and acquisitions and capital raisings for companies principally in the metals and mining, energy
and infrastructure sectors. Jeremy is a Director of Talisman Mining Limited (Chair until July
2020), Trustee of the Ross Trust and Director of Hillview Quarries Pty Ltd.
Karen Gadsby
Deputy Chair
Bachelor of Commerce, FCA, MAICD
Karen has over 20 years’ Chair/Non-Executive Director experience and has held directorships
across the publicly-listed, private, government and not-for-profit sectors in Western Australia
and Victoria. Karen is a Director of Tailor Made Spirits Co Ltd (Chair), Director of Mindful
Meditation Australia Inc. and a Director of SOSCY Pty Ltd. Karen has a finance background and
was a Chartered Accountant with Coopers and Lybrand and then worked as a senior executive
with North Limited for 13 years, in various executive roles across the areas of finance,
commercial, risk, IT and human resources.
Daniel Smetana
Non-Executive Director, former Chair
(January 1985 to November 2018)
Diploma of Commerce,
FCPA, FAIM, FAICD
Dan is a Non-Executive Director and former Chairman of Joyce Corporation Ltd and Bedshed
Franchising Pty Ltd. He has had 50 years’ Chair/Non Executive Director experience and has
held directorships across various sectors including Defence Reserves Support Council – WA,
Youth Focus, Western Power, WASO, Edge Employment, IFAP, WA Federation of PCYC and Korab
Resources Limited. Dan is a visionary leader who has been deeply involved with Joyce Corporation
in Executive, Chair or NED roles since 1984. Dan is a recipient of the Centenary Medal.
14
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
Other current directorships
of listed entities
Talisman Mining Ltd
Former directorships of listed
companies in the last 3 years
Kin Mining NL
(resigned 31 July 2019)
Special responsibilities
Member of the Audit and Risk
Committee
Member of the Remuneration
Committee
Member of the Nomination
Committee
Member KWB Board
Interests in shares and
options held directly, indirectly,
or beneficially
140,005 ordinary shares
Other current directorships
of listed entities
None
Former directorships of listed
companies in the last 3 years
Talisman Mining Ltd
(retired 4 November 2020)
Special responsibilities
Chair KWB Board
Chair of the Audit and
Risk Committee
Member of the
Remuneration Committee
Member of the Nomination
Committee
Interests in shares and
options held directly,
indirectly, or beneficially
87,500 ordinary shares
Other current directorships
of listed companies
None
Former directorships of listed
companies in last 3 years
Korab Resources Ltd
(retired 1 January 2020)
Special responsibilities
Member of the Audit and Risk
Committee
Member of the Remuneration
Committee
Member of the Nomination
Committee
Interests in shares and
options held directly,
indirectly, or beneficially
11,171,579 ordinary shares
Timothy Hantke
Non-Executive Director
Bachelor of Commerce, FAIM, FAICD
Tim specialises in mentoring and coaching CEOs, senior executives and business owners,
along with being a commercial mediator and professional company director. Having held a
broad variety of roles within organisations of all sizes, Tim now focuses on key board positions
and mentoring others. His focus is to work with leaders and to get to the source of their
thinking and behaviours, and help them find new ways of communicating, collaborating, and
negotiating to meet their organisational, professional and personal goals.
Travis McKenzie
Non-Executive Director
Bachelor of Law, Bachelor of Commerce, GAICD
Travis has had extensive experience on private boards since 2009. These organisations
operate in multiple industries including marketing, education and property development.
This experience, particularly in the marketing and property space, is particularly relevant
to the Joyce Board. His work in derivatives and foreign exchange trading has allowed
Travis to experience business and operating in Europe and the Americas, as well as here in
Australia. This exposure to international thinking allows Travis to bring fresh perspectives and
approaches to the Group. His early career as a lawyer adds complementary skills to the Board
and provides thought leadership for management in issue resolution.
Other current directorships
of listed companies
None
Former directorships of listed
companies in last 3 years
None
Special responsibilities
Chair Bedshed Franchising Pty Ltd
Chair of the Remuneration
Committee
Chair of the Nomination
Committee
Member of the Audit and Risk
Committee
Interests in shares and
options held directly,
indirectly, or beneficially
21,109 ordinary shares
Other current directorships
of listed companies
None
Former directorships of listed
companies in last 3 years
None
Special responsibilities
Alternate Director Bedshed
Franchising Pty Ltd
Member of the Audit and Risk
Committee
Member of the Remuneration
Committee
Member of the Nomination
Committee
Interests in shares and
options held directly,
indirectly, or beneficially
15,992 ordinary shares
15
ANNUAL REPORT FY22JOYCE CORPORATION LTD INFORMATION ON SECRETARIES
Daniel Madden
CEO and Group Company Secretary
Bachelor of Commerce, ACC, ACA,
Governance Institute of Australia
Dan was appointed as CEO of Joyce Corporation Ltd on 1 December 2020 and has a reputation
as a values driven, people oriented manager with a collaborative approach. Dan was previously
the Managing Director and CEO of Talisman Mining Ltd, an ASX listed mineral exploration and
development company with a track record of creating shareholder value. Dan was appointed
as Managing Director of Talisman in 2016, having been Chief Financial Officer and Company
Secretary since 2009. Dan’s prior background was in finance as CFO/General Manager Finance
in ASX listed and large international organisations, including more than 17 years’ experience
in the resource sector, including Xstrata Nickel Australasia, Jubilee Mines NL and Perilya Ltd.
Dan is an Associate Member of the Institute of Chartered Accountants of England and Wales
and a member of the Governance Institute of Australia. He graduated from the University of
Birmingham with a degree in Commerce and Accounting.
Tim Allison
CFO and Group Company Secretary
Bachelor of Commerce, CAANZ, AGIA,
ACG, GradDip Applied Finance
Tim was appointed as CFO and Company Secretary of Joyce on 1 April 2021. His career spans
more than 10 years across multiple industries with a focus on finance, including roles as CFO,
General Manager of Finance and in CFO Advisory consulting. Tim is Chartered Accountant,
having qualified at BDO Audit in Perth, WA. Tim is also a member of the Governance Institute
of Australia and has a Graduate Diploma in Applied Finance from Kaplan. Tim brings to Joyce
a diverse skill set including process automation; big data analysis; enhancement of strategic
reporting and enhancing governance standards.
Other current directorships
of listed companies
None
Former directorships of listed
companies in last 3 years
Talisman Mining Ltd
(resigned 4 November 2020)
Special responsibilities
Member KWB Board
Interests in shares and
options held directly,
indirectly, or beneficially
Nil
Other current directorships
of listed companies
None
Former directorships of listed
companies in last 3 years
None
Interests in shares and
options held directly,
indirectly, or beneficially
Nil
16
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
A N N U A L R E P O R T F Y 2 2
A N N U A L R E P O R T 2 0 2 2
J O Y C E C O R P O R A T I O N L T D
J O Y C E C O R P O R A T I O N L T D
17
ANNUAL REPORT FY22JOYCE CORPORATION LTD DIRECTORS’ REPORT
YEAR ENDED
30 JUNE 2022
Your Directors present their report on the Consolidated Entity, consisting of Joyce Corporation Ltd (“the Company”)
and the entities it controlled at the end of, or during, the year ended 30 June 2022 (“the financial year”).
The names of the Company’s Directors and Secretaries in office during the financial year and until the date of this report
are as stated below. Directors were in office for this entire period unless otherwise stated.
DIRECTORS
Name
Position
Jeremy Kirkwood
Non-Executive Director (Chair)
Appointment date
14 January 2020
Non-Executive Director (Deputy Chair)
1 July 2017
Karen Gadsby
Daniel Smetana
Timothy Hantke
Non-Executive Director
Non-Executive Director
Travis McKenzie
Non-Executive Director
Michael Gurry(a)
Non-Executive Director
(a) Retired 23 November 2021.
SECRETARIES
Daniel Madden
CEO and Group Company Secretary
Tim Allison
CFO and Group Company Secretary
PRINCIPAL ACTIVITIES
30 November 1984
9 June 2006
1 July 2019
8 May 2007
During the financial year, the principal activities of the Consolidated Entity consisted of:
– Majority owner of 51% of KWB Group Pty Ltd, operator of retail kitchen and wardrobe showrooms;
– Franchisor of the Bedshed chain of retail bedding stores; and
– Owner and operator of four Bedshed retail stores.
18
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
DIRECTORS’ REPORT
YEAR ENDED
30 JUNE 2022
REVIEW AND RESULTS OF OPERATIONS
During the financial year, the Consolidated Entity achieved revenue from operations of $129.02 million
(2021: $111.22 million) and a profit from operations before tax of $26.25 million (2021: $19.11 million) and
after tax of $17.61 million (2021: $13.00 million).
Financial position
At 30 June 2022, the Consolidated Entity had total equity of $35.49 million (2021: $26.64 million). Cash and cash
equivalents increased from $19.88 million at 30 June 2021 to $31.93 million at 30 June 2022. Unused finance facilities
were $9.10 million (2021: $9.84 million).
FUTURE DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGIES
The Company plans to further develop the KWB business and continue to invest to grow the showroom network in New
South Wales. The Bedshed business will develop through a planned expansion of its network of franchised stores with
a particular focus in New South Wales. In addition to the focus on organic revenue growth, the Company will continue to
evaluate other investment opportunities that have a natural fit to its expertise and existing portfolio.
The Board and management team signed off on Joyce’s investment in the Company’s new home staging business, Crave,
which is launching in September 2022 as a pilot in Perth. Crave leverages the Company’s understanding of the needs of
homeowners to enable Crave to style and prepare a home for sale to maximise its appeal to buyers. This helps sellers
realise the full potential of their home’s value. Crave will provide a sophisticated offering to the home staging space
by utilising the Company’s supply chain access, marketing expertise, logistics and industry relationships delivering a
seamless service to home sellers and real estate agents.
DIVIDENDS
Dividends declared or paid during the financial year are as follows:
FY20 final fully franked dividend of 5.0 cents per share
FY21 interim fully franked dividend of 7.0 cents per share
FY21 final fully franked dividend of 10.0 cents per share
FY22 interim fully franked dividend of 7.5 cents per share
Total dividends paid
2022
$’000
-
-
2,817
2,117
4,934
2021
$’000
1,405
1,971
-
-
3,376
The Directors resolved that a FY22 final dividend of 10.5 cents per share, fully franked, be paid by Joyce Corporation
Limited on 30 September 2022 to all shareholders registered as at the record date of 13 September 2022.
19
ANNUAL REPORT FY22JOYCE CORPORATION LTD DIRECTORS’ REPORT
YEAR ENDED
30 JUNE 2022
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
Throughout the year, a number of KWB showrooms and Bedshed stores experienced intermittent closures and
trading restrictions as a result of the impact of COVID-19 outbreaks across Australia.
Other than the disclosed above, there were no other significant changes in the state of affairs of the Consolidated
Entity during the year ended 30 June 2022.
SIGNIFICANT AFTER REPORTING DATE EVENTS
The Directors resolved that a FY22 final dividend of 10.5 cents per share, fully franked, be paid by Joyce Corporation
Limited on 30 September 2022 to all shareholders registered as at the record date of 13 September 2022.
On 22 August 2022, the Company announced that its 51% subsidiary, KWB Group, had agreed to the sale and
leaseback of its corporate office and warehouse factory facility in Lytton, Queensland. The sale process commenced
prior to 30 June 2022.
Other than disclosed above, no event has occurred since the reporting date to the date of this report that has significantly
affected, or may significantly affect the Consolidated Entity’s operations, the results of those operations, or the
Consolidated Entity’s state of affairs.
MEETING OF DIRECTORS
The numbers of meetings of the Company’s Board of Directors and of each Board Committee held during the financial
year and the number of meetings attended by each Director were:
Directors
Jeremy Kirkwood
Karen Gadsby
Daniel Smetana
Timothy Hantke
Travis McKenzie
Michael Gurry(a)
(a) Retired 23 November 2021.
Board of
Directors
Audit & Risk
Committee
Remuneration
Committee
Nomination
Committee
A
11
11
11
11
11
5
B
11
11
11
11
11
4
A
6
6
6
6
6
3
B
6
6
6
6
6
3
A
2
2
2
2
2
1
B
2
2
2
2
2
1
A
2
2
2
2
2
0
B
2
2
2
2
2
0
A = Number of meetings held during the time the Director held office or was a member of the committee during the
financial year.
B = Number of meetings attended during the time the Director held office or was a member of the committee during
the financial year.
20
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
The Remuneration Report details the key management personnel (KMP) remuneration arrangements for the Consolidated
Entity, in accordance with the requirements of the Corporations Act 2001 and its Regulations.
For the purposes of this report, KMP are those persons having authority and responsibility for planning, directing and
controlling the activities of the Consolidated Entity, directly or indirectly, including any Director of the Consolidated Entity.
For the purposes of this report, the term “Executive” encompasses the KMP and other senior executives of the
organisation.
The Remuneration Report is set out under the following main headings:
A. Principles used to determine the nature and amount of remuneration
B. Service agreements
C. Details of remuneration
D. Share-based compensation
E. Link between remuneration policy and Company performance
F. Voting at the 2021 Annual General Meeting (AGM)
G. Independent salary and incentive review
H. Loans or other transactions with directors and KMP
The information provided in this remuneration report is also included in the Annual Financial Report which has been
audited as required by section 308(3C) of the Corporations Act 2001.
As well as the directors previously mentioned in this Directors’ Report, other KMP of the Consolidated Entity include:
KMP
Daniel Madden
Tim Allison
Gavin Culmsee
John Bourke
Chris Palin
James Versace
Position Held
CEO and Group Company Secretary, Joyce Corporation Ltd
CFO and Group Company Secretary, Joyce Corporation Ltd
General Manager, Bedshed Franchising Pty Ltd to 30 April 2022
Chief Operating Officer, Joyce Corporation Ltd from 1 May 2022
Managing Director, KWB Group Pty Ltd
Finance Director, KWB Group Pty Ltd
Non-Executive Director as at 1 July 2022
CFO, KWB Group Pty Ltd from 21 February 2022
21
ANNUAL REPORT FY22JOYCE CORPORATION LTD REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
A. PRINCIPLES USED TO DETERMINE THE NATURE AND AMOUNT OF REMUNERATION
Remuneration Committee
The Remuneration Committee Charter establishes the role of the Remuneration Committee, which is to review and make
recommendations on Board remuneration; senior management remuneration; executive share plan participation; human
resource and remuneration policies and senior management succession planning, appointments and terminations.
The main responsibilities of the Remuneration Committee include reviewing and making recommendations on
remuneration policies for the Consolidated Entity including those governing the Directors and the KMP.
The Remuneration Committee comprises a majority of Non-Executive Directors and at least three members.
The Chair of the Remuneration Committee is appointed by the Board and is a Non-Executive Director.
The Remuneration Committee meets as and when required by the Remuneration Committee Chair and at least twice
annually. The Committee may invite persons deemed appropriate to attend meetings and may take any independent
advice as it considers necessary or appropriate. Any Committee member may request the Chair to call a meeting.
During the financial year, the Remuneration Committee reviewed and updated its Charter. A copy of the Remuneration
Committee Charter is available on the Joyce Corporation website.
Remuneration policies
The objective of the Consolidated Entity’s executive reward framework is to ensure reward is competitive and appropriate
for the results delivered. The framework aligns executive reward with achievement of the Consolidated Entity’s strategic
objectives and the creation of value for shareholders. The Remuneration Committee and Board ensure that executive
reward satisfies the following key criteria:
– Competitiveness and reasonableness;
– Acceptability to shareholders;
– Performance linkage / alignment of executive compensation to organisational results;
– Transparency; and
– Capital management.
In consultation with external remuneration consultants (where appropriate) the Consolidated Entity has structured
an executive remuneration framework that is market competitive and complementary to the reward strategy of the
organisation.
The framework aligns to shareholders’ interests by:
– Having economic profit as a core component of the framework’s design;
–
Focusing on sustained growth in shareholder wealth, consisting of dividends and growth in share price and delivering
consistent return on assets as well as focusing the executive on key non-financial drivers of value; and
– Attracting and retaining high calibre executives.
The framework aligns to program participants’ interests by:
– Rewarding capability and experience;
– Reflecting competitive reward for contribution to growth in shareholder wealth;
– Providing a clear structure for earning rewards; and
– Providing recognition for contribution.
22
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
Non-Executive Director remuneration
Fees and payments to Non-Executive Directors reflect the demands that are made on and the responsibilities of the
Directors. Non-Executive Director fees and payments are reviewed annually by the Board. The Board considers, where
appropriate, the advice of independent remuneration consultants to ensure Non-Executive Director fees and payments
are appropriate and in line with comparable entities. The Chair’s fees are determined independently to the fees of
Non-Executive Directors, based on appropriately comparable roles. The Chair is not present at any discussions
relating to the determination of their own remuneration.
The current base remuneration was last independently reviewed by Godfrey Remuneration Group in April 2021 and was
effective from 1 July 2021.
Non-Executive Directors’ fees are determined within an aggregate directors’ fee pool limit, which is periodically
recommended for approval by shareholders. The limit currently stands at $700,000 per annum and was approved by
shareholders at the Annual General Meeting on 30 November 2017.
Executive remuneration
Fixed Component
The level of fixed remuneration is set to provide a base level of remuneration which is both appropriate to the position
and is competitive with appropriately comparable roles. Fixed remuneration is reviewed annually by the Remuneration
Committee and the process involves review of the Consolidated Entity’s performance, the segment within which the
executive operates and the individual’s performance.
Variable Component – Short-Term Incentives
Goals are agreed at the start of each financial year and consist of key performance indicators (KPI’s) incorporating both
financial and non-financial corporate and individual-specific measures of performance. These measures are aligned to
the Consolidated Entity’s strategic objectives at the time. Examples of the types of measures used are targets for safety,
profit, cash balances and segment specific KPI’s. At the end of the financial year, the Remuneration Committee assesses
the actual performance of the Consolidated Entity, the relevant segment and the individual against the agreed KPI targets.
When the Consolidated Entity, or the relevant segment and the individual achieve their KPI’s, the Board will reward the
KMP with a cash bonus paid after the end of the financial year being assessed.
The amount paid is a discretionary percentage of a pre-determined (by the Board) maximum amount contingent
on the results achieved. No bonus is awarded where performance falls below the minimum threshold set.
Variable Component – Long Term Incentives
The Remuneration Committee offers performance rights in the Joyce Corporation Ltd Rights Plan (JRP). The current
JRP was approved by shareholders at the Annual General Meeting on 23 November 2021. KPI’s set under the JRP are
linked to achievement of targeted shareholder return measures over a rolling 3-year period.
B. SERVICE AGREEMENTS
This remuneration report outlines the Director and Executive remuneration arrangements with the Consolidated Entity in
accordance with the requirements of the Corporations Act 2001 and its regulations.
The employment conditions of all KMP are formalised in contracts. The directors, CEO, COO and CFO are engaged by
Joyce Corporation Ltd. All other Executives are permanent employees of subsidiaries within the Consolidated Entity.
23
ANNUAL REPORT FY22JOYCE CORPORATION LTD REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
Contractual arrangements
Remuneration arrangements for KMP are formalised in employment agreements. Details of these contracts is set out below.
Daniel Madden
Tim Allison
John Bourke
Chris Palin(a)
Gavin Culmsee
James Versace
(a) Non-Executive Director as at 1 July 2022.
Term of
agreement
Notice
period in
months
Termination
payment in
months
rolling
rolling
rolling
rolling
rolling
rolling
3
3
3
3
3
3
3
3
3
3
3
3
The Consolidated Entity can terminate each contract by providing the required written notice period or providing payment
in lieu of the notice period (based on the fixed component of the KMP’s remuneration). The Consolidated Entity may
terminate a KMP or Executive for serious misconduct without notice. Where termination with cause occurs, the Executive
is only entitled to that portion of remuneration that is fixed up to the date of termination.
All KMP are subject to at least one performance evaluation review each year.
24
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
C. DETAILS OF REMUNERATION
The remuneration summary of KMP for the current and prior financial year is set out below.
Name
Note Year
Salary
Fixed remuneration
Variable remuneration
Non-
monetary
benefits
Annual
and long
service
leave
Post-
employment
benefits
Cash
bonus
paid
Equity-
settled
shares
Other
Equity-
settled
performance
rights
Total
Performance
related
Non-executive
Directors
Jeremy
Kirkwood
Karen
Gadsby
Daniel
Smetana
Timothy
Hantke
Travis
McKenzie
Michael
Gurry
Other Key
Management
Personnel
Daniel
Madden
Gavin
Culmsee
Tim
Allison
John
Bourke
Chris
Palin
James
Versace
Derek
Fowler
Keith
Smith
Totals
2022
163,636
(a)
2021
105,559
2022
100,727
(b)
2021
104,862
2022
2021
2022
2021
2022
2021
81,818
82,031
91,273
82,031
81,818
72,264
(c)
2022
34,091
2021
116,704
2022
553,363
2021
563,451
2022
383,869
(d)
(e)
2021
229,250
2022
289,108
2021
272,617
2022
248,590
(f)
2021
58,750
2022
400,000
2021
334,247
2022
272,727
2021
264,200
(g)
2022
95,999
2021
2022
-
-
(h)
2021
37,179
2022
-
(i)
2021
173,211
2022
1,690,293
2021
1,369,454
2022 2,243,656
2021
1,932,905
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
16,364
10,028
10,073
9,962
8,182
7,793
9,127
7,793
8,182
6,865
3,409
11,087
55,337
53,528
13,478
12,230
23,568
15,939
(2,932)
23,568
2,655
8,219
3,616
25,899
23,568
5,424
29,226
40,000
10,642
9,692
12,490
7,892
-
-
45,079
27,273
35,640
9,600
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(10,513)
4,628
23,630
-
-
-
(50,725)
16,455
161,646
-
-
-
-
-
-
-
-
-
-
-
-
-
-
78,330
-
134,332
81,400
4,700
-
164,700
140,274
130,275
110,959
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
95,596
-
-
-
-
-
-
-
-
-
-
-
-
-
-
180,000
115,587
110,800
114,824
90,000
89,824
100,400
89,824
90,000
79,129
37,500
127,791
608,700
616,979
169,640
668,885
23,518
280,937
168,900
612,976
85,084
467,655
44,000
329,077
-
67,790
368,982
1,002,908
344,945
875,187
283,254
723,221
272,847
696,136
-
-
-
-
-
-
113,491
-
-
54,924
-
396,183
65,575
147,577
-
512,337
-
1,034,776
3,450,558
(19,605)
149,064
185,276
332,633
95,596
726,394
2,838,812
65,575
202,914
-
512,337
-
1,034,776
4,059,258
(19,605)
202,592
185,276
332,633
95,596
726,394
3,455,791
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
37.1%
8.4%
49.5%
35.6%
14.8%
0.0%
53.2%
55.4%
57.2%
55.1%
0.0%
0.0%
0.0%
0.0%
0.0%
24.1%
44.8%
40.7%
38.1%
33.4%
(a) Chair effective 1 December 2020.
(b)
In FY21, Karen Gadsby received fees for additional duties performed over and above her duties as a NED.
(c) Retired 23 November 2021.
(d) Appointed CEO and Group Company Secretary, Joyce Corporation Ltd effective 1 December 2020.
(e) Appointed COO, Joyce Corporation Ltd and Managing Director, Bedshed effective 1 May 2022.
(f) Appointed CFO and Group Company Secretary, Joyce Corporation Ltd effective 1 April 2021.
(g) Appointed CFO, KWB Pty Ltd effective 21 February 2022.
(h) Contract ended effective 7 August 2020. Other payments consisted of payment in lieu of notice ($11,538) and unused annual leave ($12,091).
(i)
CEO, Joyce Corporation Ltd from 31 March 2020 to 30 November 2020; Group Company Secretary, Joyce Corporation Ltd to 1 April 2021.
Other payments consisted of $100,000 paid on conclusion of modified contract and unused annual leave ($61,646).
25
ANNUAL REPORT FY22JOYCE CORPORATION LTD REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
STI – Cash Bonus
The details of the STI variable component of KMP remuneration paid during the current and prior financial year is set out below.
100%
level
STI(a)
% financial
conditions
% non-
financial
conditions
STI
financial
condition
STI
non-financial
condition
% of the
financial
condition
achieved
% of the
non-financial
condition
achieved
STI
payable
Name
Note Year
Non-executive
Directors
Jeremy
Kirkwood
Karen
Gadsby
Daniel
Smetana
Timothy
Hantke
Travis
McKenzie
Michael
Gurry
Other Key
Management
Personnel
Daniel
Madden
Gavin
Culmsee
Tim
Allison
John
Bourke
Chris
Palin
James
Versace
Derek
Fowler
Keith
Smith
Totals
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
97,913
50.00%
50.00%
48,956
48,957
100.00%
60.00%
78,330
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
-
2022
134,332
2021
2022
2021
111,000
4,700
-
2022
164,700
2021
140,274
2022
130,275
2021
2022
2021
2022
2021
2022
2021
110,959
-
-
-
-
-
-
2022
531,920
2021
362,233
2022
531,920
2021
362,233
-
50.00%
66.67%
50.00%
-
75.00%
92.84%
75.00%
92.83%
-
-
-
-
-
-
-
50.00%
33.33%
50.00%
-
25.00%
7.16%
25.00%
7.17%
-
-
-
-
-
-
-
67,166
74,000
2,350
-
123,525
130,235
97,706
103,007
-
-
-
-
-
-
-
67,166
37,000
2,350
-
41,175
10,039
32,569
7,952
-
-
-
-
-
-
-
100.00%
100.00%
100.00%
-
100.00%
100.00%
100.00%
100.00%
-
-
-
-
-
-
339,703
307,242
339,703
307,242
192,217
54,991
192,217
54,991
-
-
100.00%
134,332
20.00%
100.00%
-
100.00%
100.00%
100.00%
100.00%
-
-
-
-
-
-
81,400
4,700
-
164,700
140,274
130,275
110,959
-
-
-
-
-
-
512,337
332,633
512,337
332,633
(a)
KMP cash bonus STI’s are payable at the discretion of the Board and are based on key performance criteria, which require performance to meet or exceed pre-determined
targets. Key performance criteria include both financial and non-financial criteria.
26
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
D. SHARE-BASED COMPENSATION
Performance rights granted as compensation under the JRP
Recognition and measurement
The agreements in place can only be equity-settled and are accounted for accordingly. The cost of equity-settled
transactions with employees is measured using their fair value at the date which they were granted. In determining
the fair value at grant date, where non-market based conditions are attached, no account is taken of the probability of
achieving the related performance conditions. Where market-based conditions are attached, the probabilities of meeting
these targets are built into the underlying valuation.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period
in which any performance conditions are met, ending on the date on which the employee becomes fully entitled to the
award (vesting date). The cumulative expense recognised for these transactions at each reporting date reflects the extent
to which the vesting period has expired and the proportion of the awards that are expected to ultimately vest.
No expense is recognised for awards that do not ultimately vest due to a performance condition not being met.
On conversion, the performance rights convert to one ordinary share.
Terms and conditions
During the current financial year, 132,043 ‘FY22 performance rights’ were issued to Daniel Madden, 72,607 to Gavin
Culmsee, 62,065 to Tim Allison, 103,319 to John Bourke and 70,445 to Chris Palin. These are subject to meeting
pre-determined performance criteria.
During the prior financial year, 127,002 ‘FY21 performance rights’ were issued to Daniel Madden, 208,448 to John Bourke,
164,879 to Chris Palin and 140,484 issued to Gavin Culmsee. In addition and in recognition of past performance, 141,677
‘FY20 performance rights’ were issued to John Bourke and 112,065 to Chris Palin. These are subject to meeting
pre-determined performance criteria.
27
ANNUAL REPORT FY22JOYCE CORPORATION LTD REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
Reconciliation of performance rights
The reconciliation of the performance rights is set out below.
Daniel Madden
Gavin Culmsee
Tim Allison
John Bourke
Chris Palin
Year
Granted
FY22
FY21
FY22
FY21
FY20(a)
FY22
FY22
FY21
FY20(a)
FY22
FY21
FY20(a)
Balance
at start
of year
Number
Granted
during
year
Vested Forfeited
Other
Number
Number Number Number
-
132,043
127,002
-
-
72,607
140,484
76,387
-
-
-
-
62,065
103,319
208,448
141,677
-
-
-
70,445
164,879
112,065
-
-
-
-
-
-
76,387
-
-
-
141,677
-
-
112,065
970,942
440,479
330,129
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Balance
at end
of year
Number
132,043
127,002
72,607
140,484
-
62,065
103,319
208,448
-
70,445
164,879
-
Maximum
value yet
to vest(b)
$000
465
208
251
156
-
215
357
557
-
244
440
-
1,081,292
2,893
(a)
The ‘FY20 performance rights’ vesting period ended on 30 June 2022, with expectations that these rights will fully vest. This will be approved at the next meeting
of the Remuneration Committee.
(b)
‘Maximum value yet to vest’ represents the full accounting value assuming 100% of the rights will vest.
Details of performance rights
Details of the performance rights on issue as at 30 June 2022 are summarised below.
FY20 Rights
Beneficiary
Number of
Rights Granted
Fair Value per right
(JYC share price on
grant date)
Expected vesting date
Vesting conditions
No. of rights
expected to vest
Total fair value
$378,278
Commencement date
1 July 2019
John Bourke
Chris Palin
Gavin Culmsee
141,677
$2.67
30 June 2022
(3 years)
Profit metric
of KWB EBIT
cumulative
over 3 years(a)
112,065
$2.67
$299,214
1 July 2019
30 June 2022
(3 years)
Profit metric
of KWB EBIT
cumulative
over 3 years(a)
76,387
$1.55
$118,400
1 July 2019
30 June 2022
(3 years)
Profit metric
of Bedshed EBIT
cumulative
over 3 years(a)
141,677
112,065
76,387
(a)
The ‘FY20 performance rights’ vesting period ended on 30 June 2022, with expectations that these rights will fully vest. This will be approved at the next meeting
of the Remuneration Committee.
28
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
FY21 Rights
Beneficiary
Number of
Rights Granted
Fair Value per right
(JYC share price on
grant date)
Daniel Madden
John Bourke
Chris Palin
Gavin Culmsee
127,002
208,448
164,879
140,484
$1.64
$2.67(c)
$2.67(c)
$1.11
Total fair value
$208,283
$556,556
$440,227
$155,937
Commencement date
1 December 2020(b)
1 July 2020
1 July 2020
1 July 2020
Expected vesting date
Vesting conditions
No. of rights
expected to vest
30 June 2023
(3 years)
Profit metric
of Group EBIT
cumulative
over 3 years(a)
30 June 2023
(3 years)
Profit metric
of KWB EBIT
cumulative
over 3 years(a)
30 June 2023
(3 years)
Profit metric
of KWB EBIT
cumulative
over 3 years(a)
30 June 2023
(3 years)
Profit metric
of Bedshed EBIT
cumulative
over 3 years(a)
63,501 - 127,002
104,224 - 208,448
82,440 - 164,879
70,242 - 140,484
(a)
The expense recognised in respect of the performance rights is based on the Board’s assessment of the probability that certain milestone earnings will be achieved,
measured cumulatively over the three-year period commencing 1 July 2020 and ending 30 June 2023. There are three milestones: “threshold”; “target”; and “stretch and
above”. Meeting these milestones results in, respectively, 25%, an additional 25%, and the final 50% of the rights vesting into ordinary shares.
(b) Daniel Madden’s contract of employment commenced on 1 December 2020 and as a result for the financial year ended 30 June 2021 only a prorated expense was recognised.
(c)
The formal grant date of the ‘FY21 performance rights’ to John Bourke and Chris Palin was determined post the 30 June 2021 year end and under the requirements
of the Australian Accounting Standards, the associated accounting expense is based on the underlying share price at formal grant date.
FY22 Market based rights
Beneficiary
Daniel Madden
Tim Allison
John Bourke
Chris Palin
Gavin Culmsee
Maximum number
of rights granted
39,613
12,413
20,664
14,089
14,521
Vesting conditions
TSR metric(a)
TSR metric(a)
TSR metric(a)
TSR metric(a)
TSR metric(a)
Fair value model inputs
Grant date
Expected life
Share price on grant date
Expected volatility (%)
Risk-free interest rate (%)
Model used
30 December 2021
3 years
$3.33
50%
0.925%
Monte Carlo
(a)
The probability of the performance rights vesting has already been taken into account in the initial valuation of the rights. Therefore the expense recognised in respect of the
market-based performance rights is based on the extent to which the vesting period has expired, within the three years commencing 1 July 2021 and ending 30 June 2024.
29
ANNUAL REPORT FY22JOYCE CORPORATION LTD
REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
FY22 Non-market based rights
Beneficiary
Daniel Madden
Tim Allison
John Bourke
Chris Palin
Gavin Culmsee
Maximum number
of rights granted
92,430
49,652
82,655
56,356
58,086
Vesting conditions
JYC ROE
metric(a)
JYC ROE
metric(a)
KWB EBIT
metric(a)
KWB EBIT
metric(a)
Bedshed EBIT
metric(a)
Fair value model inputs
Grant date
Expected life
Share price on grant date
Expected volatility (%)
Risk-free interest rate (%)
Model used
30 December 2021
3 years
$3.33
50%
0.925%
Black-Scholes
(a)
The expense recognised in respect of the performance rights is based on the Board’s assessment of the probability that certain milestone Return on Equity (ROE) or Divisional
Earnings Before Interest and Tax (EBIT) metrics will be achieved, measured cumulatively over the three-year period commencing 1 July 2021 and ending 30 June 2024. There are
three milestones: “threshold”; “target”; and “stretch and above”. Meeting these milestones results in, respectively, 25%, an additional 25%, and the final 50% of the rights vesting
into ordinary shares.
Option and holding rights granted as compensation
During the financial year, no options were granted or vested as equity compensation benefits to any Director or Executive
of the Consolidated Entity (2021: nil).
Option holdings
During the financial year, there were no options on issue to any Director or Executive of the Consolidated Entity (2021: nil).
Partly paid ordinary shares as compensation
There were no partly paid ordinary shares held or granted during the financial year as compensation to any Director or
Executive of the Consolidated Entity (2021: nil).
30
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
Share holdings
The number of shares in the Company held during the financial year by each Director and KMP of the Consolidated Entity,
including their personally related parties, are set out below.
Balance
1 July 2021
Granted as
remuneration
On exercise
of options
On-market
purchases(a)
Other net
change
Balance
30 June 2022
Jeremy Kirkwood
Karen Gadsby
132,978
87,500
Daniel Smetana
11,171,579
Timothy Hantke
Travis McKenzie
Michael Gurry
Daniel Madden
Gavin Culmsee
Tim Allison
John Bourke
Chris Palin
James Versace
20,000
15,086
140,593
-
40,000
-
165,359
-
-
TOTAL
11,773,095
(a)
Includes amounts reinvested under the Company’s DRP.
(b) Michael Gurry resigned as a Director on 23 November 2021.
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7,027
-
-
1,109
836
-
-
-
-
-
-
-
-
-
-
-
-
(140,593)(b)
-
-
-
-
-
-
140,005
87,500
11,171,579
21,109
15,922
-
-
40,000
-
165,359
-
-
8,972
(140,593)
11,641,474
E. LINK BETWEEN REMUNERATION POLICY AND COMPANY PERFORMANCE
The Consolidated Entity provided Executives with variable remuneration in the form of short-term and long-term
incentives as described in Part A of the Remuneration Report. These incentives are payable upon the achievement
of certain goals covering both financial and non-financial, corporate and individual measures of performance.
Included in the measures are contributions to profit, cash targets and departmental functional KPI’s.
The following table shows the revenue, profit and dividends for the last five years for the Consolidated Entity, as well
as the share price at the end of the respective financial year. The dividend includes ordinary and special dividends paid
or payable in respect of each financial year.
Revenue from continuing operations (a)
Profit from continuing operations
after tax (a)
Share price at year-end $
Dividends (cents)
(a) Revenue and profit exclude discontinued operations.
FY22
$’000
129,016
17,610
2.40
18.0
FY21
$’000
111,224
12,995
2.65
17.0
FY20
$’000
85,757
2,674
1.10
10.0
FY19
$’000
84,205
6,385
1.53
12.7
FY18
$’000
78,093
6,204
1.42
11.0
31
ANNUAL REPORT FY22JOYCE CORPORATION LTD REMUNERATION REPORT – AUDITED
YEAR ENDED
30 JUNE 2022
F. VOTING AT THE 2021 ANNUAL GENERAL MEETING (AGM)
At the 2021 Annual General Meeting (“AGM”), 54.25% of shareholders votes cast were against adopting the 2021
Remuneration Report – Audited (“Remuneration Report”) constituting a “first strike” under the Corporations Act 2001
(Cth) (“Corporations Act”).
Shareholders should note that in order to be carried, the 2022 Remuneration Report requires a 75% majority vote at the
2022 AGM, otherwise the Company will receive a “second strike” under the Corporations Act. Should this ‘second strike’
eventuate, a subsequent board spill resolution will be required to be held (under the Corporations Act).
As with previous years, during the 2022 financial year, the Remuneration Committee and the Board considered the
views of shareholders and continues to assess the appropriateness of the Company’s remuneration policies and
competitiveness to ensure it aligns with the Company’s performance against key business goals and objectives.
The Board is committed to ensuring there is continued demonstrable alignment between performance and compensation
for key management personnel.
G. INDEPENDENT SALARY AND INCENTIVE REVIEW
Although no formal independent remuneration review was undertaken during the year, the Company consistently checked
any proposed remuneration changes with independent advisors.
H. LOANS OR OTHER TRANSACTIONS WITH DIRECTORS AND KMP
There are no loans outstanding with any Director or Executive as at 30 June 2022 (2021: $nil).
During the financial year, the entities of the Consolidated Entity entered into the following transactions with Key
Management Personnel:
Related party
Type of transaction
Key Management Personnel
Received dividend payments totalling $1,860,355, with $28,695 reinvested under
the Company’s DRP(a).
(a)
Includes amounts paid to Michael Gurry during his tenure as a Director up to date of his retirement (23 November 2021).
Other than the items disclosed above, there are no other material transactions with KMP not in the ordinary course
of business.
END OF AUDITED REMUNERATION REPORT.
32
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
Directors’ REPORT – cont.
YEAR ENDED
30 JUNE 2022
INSURANCE OF OFFICERS
During the financial year, Joyce Corporation Ltd paid a premium to insure the Directors, Secretaries and KMP of the
Consolidated Entity. A clause in the relevant insurance policy prevents the disclosure of the amount of the premium.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought
against the Officers of the Consolidated Entity and any other payments arising from liabilities incurred by the Officers
in connection with such proceedings. This does not include such liabilities that arise from conduct involving a wilful
breach of duty by the Officers or the improper use by the Officers of their position or of information to gain advantage for
themselves or someone else or to cause detriment to the Company or more broadly to the Consolidated Entity. It is not
possible to apportion the premium between amounts relating to the insurance against legal costs and those relating to
other liabilities.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on
behalf of the Company, or to intervene in any proceedings to which the Company is a party, for taking responsibility on
behalf of the Company for all or part of those proceedings.
PERFORMANCE IN RELATION TO ENVIRONMENTAL REGULATION
Joyce Corporation Ltd is party to licenses issued by the Environmental Protection Authority as per NGER Act 2007 and
various other authorities throughout Australia. These licenses regulate the management of air and water quality, the
storage and carriage of hazardous materials and disposal of wastes associated with the Consolidated Entity’s properties.
There have been no new or material known breaches associated with the Consolidated Entity’s license conditions.
NON-AUDIT SERVICES
Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the
auditor are outlined in Note 28.
The Directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another
person or firm on the auditor’s behalf), is compatible with the general standard of independence for auditors imposed
by the Corporations Act 2001.
The Directors are of the opinion that the $118,070 of non-audit services provided by BDO during the year (as disclosed
in Note 28) do not compromise the external auditor’s independence requirements of the Corporations Act 2001 for the
following reasons:
–
All non-audit services have been reviewed and approved to ensure that they do not impact the integrity and
objectivity of the auditor; and
–
None of the services undermine the general principles relating to auditor independence as set out in APES 110
Code of Ethics for Professional Accountants issued by the Accounting Professional and Ethical Standards Board,
including reviewing or auditing the auditor’s own work, acting in a management or decision-making capacity for
the Company, acting as advocate for the Company or jointly sharing economic risks and rewards.
AUDITOR’S INDEPENDENCE DECLARATION
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001
is set out on page 35.
33
ANNUAL REPORT FY22JOYCE CORPORATION LTD Directors’ REPORT – cont.
YEAR ENDED
30 JUNE 2022
ROUNDING OF AMOUNTS
The Company is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the ‘rounding off’ of amounts in
the financial statements. Amounts in the financial statements have been rounded in accordance with the instrument to
the nearest thousand dollars, or in certain cases, the nearest dollar.
Signed in accordance with a resolution of the Directors made pursuant to section 298(2) of the Corporations Act 2001.
J Kirkwood
Chair
Perth, 30 August 2022
34
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
auditor’s independence declaration
YEAR ENDED
30 JUNE 2022
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
Level 9, Mia Yellagonga Tower 2
5 Spring Street
Perth WA 6000
PO Box 700 West Perth WA 6872
Australia
DECLARATION OF INDEPENDENCE BY NEIL SMITH TO THE DIRECTORS OF JOYCE CORPORATION LTD
As lead auditor of Joyce Corporation Ltd for the year ended 30 June 2022, I declare that, to the best of
my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Joyce Corporation Ltd and the entities it controlled during the period.
Neil Smith
Director
BDO Audit (WA) Pty Ltd
Perth
30 August 2022
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia
Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO
International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability
limited by a scheme approved under Professional Standards Legislation
35
ANNUAL REPORT FY22JOYCE CORPORATION LTD CORPORATE GOVERNANCE STATEMENT
YEAR ENDED
30 JUNE 2022
Joyce Corporation Ltd (“the Company”) and the Board are committed to achieving and demonstrating a high standard of
corporate governance. The Company has reviewed its corporate governance practices against the Corporate Governance
Principles and Recommendations (4th edition) published by the ASX Corporate Governance Council.
The 2022 Corporate Governance Statement reflects the corporate governance practices in place throughout the financial
year. The Company’s current Corporate Governance Statement can be viewed at www.joycecorp.com.au.
36
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
YEAR ENDED
30 JUNE 2022
Joyce Corporation Ltd
AND CONTROLLED ENTITIES
ABN: 80 009 116 269
ANNUAL FINANCIAL REPORT
For the Year Ended 30 June 2022
37
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
YEAR ENDED
30 JUNE 2022
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
FOR THE YEAR ENDED 30 JUNE 2022
Revenue
Cost of sales
Gross profit
Fair value gain on investment property revaluation
Other revenue
Variable costs
Contribution margin
Expenses
Employment expenses
Occupancy expenses
Marketing expenses
Administration expenses
Profit before depreciation, interest and tax
Depreciation and amortisation
Profit before interest and tax
Net interest
Profit before tax
Income tax expense
Profit for the period
Profit is attributable to:
Ordinary equity holders of the Company
Non-controlling interests
Earnings per share (cents per share) for profit attributable
to ordinary equity holders of the Company:
Basic earnings per share
Diluted earnings per share
Note
22
22
15
22
22
22
22
22
22
23
19
19
2022
$’000
129,016
(61,178)
67,838
6,377
2,114
(10,077)
66,252
2021
$’000
111,224
(52,417)
58,807
-
4,385
(8,030)
55,162
(25,202)
(22,031)
(1,364)
(2,458)
(5,020)
32,208
(5,505)
26,703
(453)
26,250
(8,640)
17,610
9,086
8,524
17,610
(1,238)
(2,694)
(4,907)
24,292
(4,663)
19,629
(521)
19,108
(6,113)
12,995
7,574
5,421
12,995
32.19
32.19
26.92
26.92
The consolidated statement of profit or loss should be read in conjunction with the accompanying notes.
38
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
YEAR ENDED
30 JUNE 2022
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2022
Profit for the year
Other comprehensive income
Items that will not be reclassified to profit or loss
Other comprehensive income for the year, net of tax
Note
2022
$’000
17,610
-
-
2021
$’000
12,995
-
-
Total comprehensive income for the year
17,610
12,995
Total comprehensive income for the year attributable to:
Ordinary equity holders of the Company
Non-controlling interests
9,086
8,524
17,610
7,574
5,421
12,995
The consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
39
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
YEAR ENDED
30 JUNE 2022
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2022
Note
2022
$’000
2021
$’000
ASSETS
Current assets
Cash and cash equivalents
Trade receivables
Inventories
Other assets
Other financial assets
Assets held for sale
Total current assets
Non-current assets
Other assets
Deferred tax assets
Right-of-use assets
Property, plant and equipment
Investment property
Intangible assets
Total non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Trade and other payables
Provisions
Lease liabilities
Provision for income tax
Total current liabilities
Non-current liabilities
Lease liabilities
Deferred tax liabilities
Provisions
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Share-based payments reserve
Retained earnings
Parent entity interest
Non-controlling interest
TOTAL EQUITY
9
10
11
12
13
30
12
23
24
14
15
5
16
17
24
23
24
23
17
18
20
26
31,933
1,079
3,182
1,068
1,218
16,000
54,480
635
6,147
13,933
3,423
-
7,597
31,735
19,881
591
3,225
464
582
-
24,743
114
6,005
12,454
8,892
9,623
7,450
44,538
86,215
69,281
24,784
2,884
4,890
382
32,940
10,443
6,760
584
17,787
19,747
2,410
3,974
1,710
27,841
9,788
4,364
649
14,801
50,727
42,642
35,488
26,639
18,705
1,777
8,045
28,527
6,961
35,488
18,397
742
3,893
23,032
3,607
26,639
The consolidated statement of financial position should be read in conjunction with the accompanying notes.
40
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
YEAR ENDED
30 JUNE 2022
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2022
Note
2022
$’000
2021
$’000
Cash flows from / (used in) operating activities
Receipts from customers
Payments to suppliers and employees
Income tax paid
Interest received
Net cash flows from operating activities
Cash flows from / (used in) investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
Proceeds from sale of discontinued operations
Proceeds from sale of property, plant and equipment
Net cash flows from investing activities
Cash flows (used in) financing activities
Dividends paid
Dividends paid to non-controlling interests
Payment of lease liabilities
Repayment of borrowings
Net cash flows (used in) financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Reconciliation of cash
Cash at bank and in hand
133,822
(103,706)
(7,714)
36
22,438
(1,371)
(207)
-
5,453
3,875
(4,626)
(5,170)
(4,465)
-
115,904
(83,931)
(4,815)
8
27,166
(1,394)
3,300
111
2,017
(4,760)
(5,472)
(3,963)
(5,750)
(14,261)
(19,945)
12,052
19,881
31,933
31,933
31,933
9,238
10,643
19,881
19,881
19,881
29
5
29
14
26
24
6
9
9
The consolidated statement of cash flows should be read in conjunction with the accompanying notes.
41
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
YEAR ENDED
30 JUNE 2022
Balance at 1 July 2020
Total comprehensive income /
(loss) for the year:
Profit attributable to members
of the parent entity
Profit attributable to non-
controlling interests
Total comprehensive income /
(loss) for the year
Transactions with owners
in their capacity as owners:
Shares issued
Share-based payments
18
20
Dividends paid or provided for
21, 26
Balance at 30 June 2021
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2022
Contributed
Equity
Share-
based
Payments
Reserve
Retained
Earnings /
(Losses)
Non-
Controlling
Interest
Note
$’000
$’000
$’000
$’000
Total
Equity
$’000
18,280
20
(305)
3,658
21,653
-
-
-
117
-
-
18,397
-
-
-
-
722
-
742
7,574
-
7,574
-
5,421
5,421
7,574
5,421
12,995
-
-
(3,376)
3,893
-
-
(5,472)
3,607
117
722
(8,848)
26,639
Total
Equity
$’000
Contributed
Equity
Share-
based
Payments
Reserve
Retained
Earnings /
(Losses)
Non-
Controlling
Interest
Note
$’000
$’000
$’000
$’000
Balance at 1 July 2021
Total comprehensive income /
(loss) for the year:
Profit attributable to members
of the parent entity
Profit attributable to non-
controlling interests
Total comprehensive income /
(loss) for the year
Transactions with owners in their
capacity as owners:
Shares issued
Share-based payments
18
20
Dividends paid or provided for
21, 26
Balance at 30 June 2022
18,397
742
3,893
3,607
26,639
-
-
-
308
-
-
18,705
-
-
-
-
1,035
-
1,777
9,086
-
9,086
-
8,524
8,524
9,086
8,524
17,610
-
-
(4,934)
8,045
-
-
(5,170)
6,961
308
1,035
(10,104)
35,488
The consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
42
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. CORPORATE INFORMATION
The consolidated financial statements of Joyce Corporation Ltd (“the Company”) for the financial year ended 30 June
2022 were authorised for issue in accordance with a resolution of the Directors of the Company dated 30 August 2022.
Joyce Corporation Ltd is a company incorporated in Australia and limited by shares which are publicly traded on the
Australian Securities Exchange. The Company is a for-profit entity for the purpose of this financial report.
The nature of the operations and principal activities of the Company and its controlled entities are described in the
Directors’ Report.
The consolidated financial statements comprise the financial statements of Joyce Corporation Ltd and its controlled
subsidiaries (“the Consolidated Entity”).
Critical Accounting Estimates and Judgements: COVID-19 pandemic
Judgement has been exercised in considering the impacts the COVID-19 pandemic has had, or may have, on the Consolidated
Entity based on known information. This consideration extends to the nature of the products and services offered, customers,
supply chain, staffing and geographic regions in which the Consolidated Entity operates. There does not currently appear to be
either any significant impact upon the financial statements or any significant uncertainties with respect to events or conditions
which may impact the Consolidated Entity unfavourably at the reporting date.
Significant Accounting Policy: Basis of preparation
These general-purpose financial statements for the financial year ended 30 June 2022 have been prepared in accordance with
requirements of the Corporations Act 2001 and Australian Accounting Standards.
Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with
International Financial Reporting Standards.
Historical cost convention
These financial statements have been prepared under the historical cost convention, except for the Consolidated Entity’s
investment property and certain other financial instruments which are measured at fair value.
Significant Accounting Policy: Principles of consolidation
The Consolidated Entity controls an entity when the Consolidated Entity is exposed to, or has rights to, variable returns from
its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity.
All controlled entities have a 30 June financial year end. The existence and effect of potential voting rights that are currently
exercisable or convertible are considered when assessing whether the Consolidated Entity controls another entity.
Refer to Note 26 in relation to the list of controlled entities.
Consolidated financial statements are the financial statements of the Consolidated Entity presented as those of a single
economic entity. The consolidated financial statements are prepared using uniform accounting policies for like transactions and
other events in similar circumstances.
All significant intra-group balances and transactions, including income, expenses and dividends, are eliminated in full on
consolidation.
43
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
YEAR ENDED
30 JUNE 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The results of the entities acquired or disposed of during the financial year are accounted for from the respective dates
of acquisition or up to the dates of disposal. On disposal, the attributable amount of goodwill, if any, is included in the
determination of the gain or loss on disposal.
Non-controlling interests, being that portion of the profit or loss and net assets of subsidiaries attributable to equity interests
held by persons outside the Consolidated Entity, are shown separately within the equity section of the Consolidated Statement
of Financial Position, Consolidated Statement of Profit or Loss and Consolidated Statement of Comprehensive Income.
Amounts held on trust for the Bedshed ‘Marketing Fund’ and Bedshed ‘Deposit Guarantee’ are not funds of the Consolidated
Entity and have not been consolidated.
Significant Accounting Policy: Comparatives
When required by accounting standards, comparative figures have been adjusted to maintain consistency with classification and
presentation for the current financial year.
Significant Accounting Policy: Rounding of amounts
The Consolidated Entity is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the ‘rounding off’ of amounts
in the financial statements. Amounts in the financial statements have been rounded in accordance with the instrument to the
nearest thousand dollars, or in certain cases, the nearest dollar.
Significant Accounting Policy: Functional and presentation currency
Items included in the financial statements of each of the Consolidated Entity’s entities are measured using the currency of the
primary economic environment in which the entity operation (‘the functional currency’). The consolidated financial statements
are presented in Australian dollar ($), which is the Consolidated Entity’s functional and presentation currency.
2. SIGNIFICANT AFTER REPORTING DATE EVENTS
The Directors resolved that a FY22 final dividend of 10.5 cents per share, fully franked, be paid by Joyce Corporation
Limited on 30 September 2022 to all shareholders registered as at the record date of 13 September 2022.
On 22 August 2022, the Company announced that its 51% subsidiary, KWB Group, had agreed to the sale and leaseback
of its corporate office and warehouse factory facility in Lytton, Queensland. Refer to Note 30 for further details.
Other than disclosed above, no event has occurred since the reporting date to the date of this report that has significantly
affected, or may significantly affect the Consolidated Entity’s operations, the results of those operations, or the
Consolidated Entity’s state of affairs.
44
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
3. FINANCIAL RISK MANAGEMENT
The Consolidated Entity’s operations expose it to a variety of financial risks: market risk (including currency risk and
interest rate risk), credit risk and liquidity risk. The Consolidated Entity’s overall risk management program seeks to
minimise potential adverse effects on the financial performance of the Consolidated Entity.
The Consolidated Entity holds the following financial instruments:
Financial assets
Cash and cash equivalents
Trade receivables
Other receivables
Other financial assets
Financial liabilities
Trade and other payables
Lease liabilities
Market risk
(i) Foreign exchange risk
Note
9
10
12
13
16
24
2022
$’000
31,933
1,079
323
1,218
34,553
24,784
15,333
40,117
2021
$’000
19,881
591
130
582
21,184
19,747
13,762
33,509
The Consolidated Entity’s exposure to foreign currency risk is not material and is largely limited to purchases of inventory
within the Company-Owned Bedshed stores.
(ii) Cash flow interest rate risks
The Consolidated Entity’s main interest rate risk has historically arisen from its borrowings activities. Borrowings issued
at variable rates expose the Consolidated Entity to cash flow interest rate risk. The Consolidated Entity’s polices seek
to manage both interest rate and liquidity risks (see below), by assessment of expectations about interest rates in the
medium term and the Consolidated Entity’s need for flexibility to minimise the Consolidated Entity’s interest expense.
45
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As at the reporting date, the Consolidated Entity had the following variable and fixed rate financial instruments:
2022
2021
Average interest rate
Average interest rate
Variable
Fixed
$000
Variable
Fixed
$000
Financial assets
Cash and cash equivalents
0.01%
Financial liabilities
CBA market rate loan
(revolving facility)
NAB business loan
CBA market rate loan 1
CBA market rate loan 2
3.00%
2.99%
-
-
-
-
-
-
-
31,933
0.01%
-
2.99%
2.25%
2.25%
-
-
-
-
-
-
-
-
-
-
19,881
-
-
-
-
-
An analysis by maturities is provided in (b) below.
The Consolidated Entity analyses its interest rate exposure on a dynamic basis. Various scenarios are modelled taking
into consideration refinancing, renewal of existing positions and alternative financing. This allows the Consolidated
Entity to manage its cash flow interest rate risk by adopting an appropriate mix of fixed versus variable rate debt and
an appropriate mix of debt maturities to provide it with flexibility to repay debt as quickly as possible whilst maintaining
liquidity to take advantage of business opportunities as they arise.
(a) Credit risk
The analysis of credit risk is focussed on the high credit quality financial institutions with which deposits are held and
high credit quality wholesale customers with which the Consolidated Entity trades.
Credit risk is managed on a Consolidated Entity basis. Credit risk arises from cash and cash equivalents, deposits
with banks and other financial institutions, as well as credit exposures to wholesale customers, including outstanding
receivables and committed transactions. For banks and financial institutions, only independently rated parties with a
minimum rating of ‘A’ are accepted. If wholesale customers are independently rated, these ratings are used. Otherwise,
if there is no independent rating, the credit quality of the customer is assessed internally, considering the customer’s
financial position, past performance and other factors as appropriate. Credit limits are then set internally based on the
assessment of the above factors. The compliance with credit limits by wholesale customers is regularly monitored by
management.
The maximum exposure to credit risk at the reporting date is the carrying amount of the financial assets. For wholesale
customers without a credit rating, the Consolidated Entity generally retains title over the goods sold until full payment
is received. The Consolidated Entity does not hold any credit derivatives to offset its credit exposure. The Consolidated
Entity trades only with recognised, creditworthy third parties and as such, collateral is not requested nor is it the
Consolidated Entity’s policy to securitise its trade receivables.
46
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external
credit ratings (if available) or to historical information about counterparty default rates. The credit ratings of the
Consolidated Entity’s financial assets is as follows:
Cash and cash equivalents
Trade receivables
Other receivables
Other financial assets
(b) Liquidity risk
AA-
Non-rated
Non-rated
Non-rated
2022
$’000
31,933
1,079
323
1,218
34,553
2021
$’000
19,881
591
130
582
21,184
The Consolidated Entity manages liquidity risk by continuously monitoring forecast and actual cash flows and matching
the maturity profiles of financial assets and liabilities. Due to the dynamic nature of its underlying businesses, the
Consolidated Entity aims at maintaining flexibility in funding by keeping committed credit lines available and, where
possible, with a variety of counterparties. Surplus funds are generally invested in term deposits or used to repay debt.
Financing arrangements
Refer to Note 6 in relation to the financing facilities available at reporting date.
47
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Maturities of financial assets and financial liabilities
The tables below present, as at the reporting date, the Consolidated Entity’s financial assets and liabilities in relevant
maturity groupings based on the remaining period to the contractual maturity date. The amounts disclosed in the table
are the contractual undiscounted cash flows.
Year ended 30 June 2022
Consolidated financial assets
Cash and cash equivalents
Trade receivables
Other receivables
Other financial assets
Consolidated financial liabilities
Trade and other payables
Lease liabilities
≤ 12 months
1-5 years
> 5 years
$’000
$’000
$’000
Total
$’000
31,933
1,079
323
1,218
34,553
(24,784)
(4,890)
(29,674)
-
-
-
-
-
-
-
-
-
-
-
-
(9,236)
(9,236)
(1,207)
(1,207)
31,933
1,079
323
1,218
34,553
(24,784)
(15,333)
(40,117)
Net maturity
4,879
(9,236)
(1,207)
(5,564)
Year ended 30 June 2021
Consolidated financial assets
Cash and cash equivalents
Trade receivables
Other receivables
Other financial assets
Consolidated financial liabilities
Trade and other payables
Lease liabilities
≤ 12 months
1-5 years
> 5 years
$’000
$’000
$’000
Total
$’000
19,881
591
16
582
21,070
19,747
3,974
23,721
-
-
114
-
114
-
8,884
8,884
-
-
-
-
-
-
904
904
19,881
591
130
582
21,184
19,747
13,762
33,509
Net maturity
(2,651)
(8,770)
(904)
(12,325)
48
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Capital risk management
Management oversees the deployment of the Consolidated Entity’s capital in a way that maintains a stable debt to equity
ratio, provides shareholders with appropriate returns and ensures that the Consolidated Entity can fund its operations
and continue as a going concern. The Consolidated Entity’s debt and capital includes ordinary share capital and financial
liabilities, supported by financial assets. The Consolidated Entity is not subject to any externally imposed capital
requirements.
Management oversees the Consolidated Entity’s capital by assessing the Consolidated Entity’s financial risks and
adjusting its capital structure in response to changes in these risks. These responses include the management of the
level of debt, dividends to shareholders and share issues.
Estimates and judgements are continually re-evaluated in order to contemplate the most up to date information available
to management.
4. SEGMENT INFORMATION
(a) Operating segments
Operating segments are identified based on internal reports about components of the Consolidated Entity that are
regularly reviewed by the chief operating decision makers (The Board of Directors and the CEO) in order to allocate
resources to the segments and to assess their performance.
The operating businesses are organised and managed separately according to the nature of the products and services
provided, with each segment representing a strategic business unit that offers different products and serves different
markets.
The Consolidated Entity has the following operating segments:
– Operation of retail kitchen and wardrobe showrooms;
– Bedshed retail bedding franchise operation; and
– Company-Owned retail bedding stores.
Transfer prices between operating segments are set on an arms-length basis and in a manner consistent with
transactions with third parties.
(b) Geographic segments
The Consolidated Entity operates in one principal geographical area namely that of Australia (country of domicile).
Each segment is managed on a national basis and management consider that geographic areas are not a consideration
in segment performance.
(c) Information about major customers
No single customer of the Consolidated Entity generated more than 10% of the Consolidated Entity’s revenue during the
year ended 30 June 2022 (2021: none).
In the retail operations of the Consolidated Entity, namely KWB and Bedshed Company-Owned stores, no single customer
represents a material amount of revenue.
49
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The following table presents revenue and profit information and certain asset and liability information regarding operating
segments for the year ended 30 June 2022.
Revenue
Revenue
Inter-segment sales
Total segment revenue
Timing of revenue recognition:
At a point in time
Over time
Unallocated revenue
Total consolidated revenue
Result
Segment result
Unallocated expenses net of unallocated income
Income tax expense
Net consolidated profit for the year
Assets and liabilities
as at 30 Jun 2022
Segment assets
Unallocated assets
Total assets
Segment liabilities
Unallocated liabilities
Total liabilities
Retail
Kitchen
Showrooms
Bedshed
Franchise
$’000
$’000
Retail
Bedding
Stores
$’000
107,957
-
107,957
107,957
-
107,957
5,345
-
5,345
-
5,345
5,345
15,714
-
15,714
15,714
-
15,714
25,588
2,831
1,938
52,977
10,428
13,242
36,481
2,650
5,696
Total
$’000
129,016
-
129,016
123,671
5,345
129,016
-
129,016
30,357
(4,107)
(8,640)
17,610
76,647
9,568
86,215
44,827
5,900
50,727
Other segment information for
the year ended 30 Jun 2022
Capital expenditure on PPE and intangibles
Depreciation and amortisation
1,198
4,276
29
85
65
985
1,292
5,346
50
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The following table presents revenue and profit information and certain asset and liability information regarding operating
segments for the year ended 30 June 2021.
Revenue
Revenue
Inter-segment sales
Total segment revenue
Timing of revenue recognition:
At a point in time
Over time
Unallocated revenue
Total consolidated revenue
Result
Segment result
Unallocated expenses net of unallocated income
Income tax expense
Net consolidated profit for the year
Assets and liabilities
as at 30 Jun 2021
Segment assets
Unallocated assets
Total assets
Segment liabilities
Unallocated liabilities
Total liabilities
Retail
Kitchen
Showrooms
Bedshed
Franchise
$’000
$’000
Retail
Bedding
Stores
$’000
89,693
-
89,693
89,693
-
89,693
4,834
-
4,834
-
4,834
4,834
16,697
-
16,697
16,697
-
16,697
16,320
2,629
3,257
41,549
8,540
12,308
32,550
2,205
6,556
Total
$’000
111,224
-
111,224
106,390
4,834
111,224
-
111,224
22,206
(3,098)
(6,113)
12,995
62,397
6,884
69,281
41,311
1,331
42,642
Other segment information for
the year ended 30 Jun 2021
Capital expenditure on PPE and intangibles
Depreciation and amortisation
1,346
3,450
25
82
9
1,043
1,380
4,575
51
ANNUAL REPORT FY22JOYCE CORPORATION LTD
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
5. INTANGIBLE ASSETS
Software development
Goodwill
Total intangible assets
2022
$’000
267
7,330
7,597
2021
$’000
120
7,330
7,450
Significant Accounting Policy: Intangible Assets
Acquired both separately and from a business combination
Intangible assets acquired separately are capitalised at cost. Following initial recognition, the cost model is applied to each
individual class of intangible assets. Where amortisation is charged on assets with finite lives, this expense is taken to the
Consolidated Statement of Profit or Loss through the ‘depreciation and amortisation’ expense line item.
Intangible assets, excluding development costs, created within the business are not capitalised and expenditure is charged
against profits (or losses) in the period in which the expenditure is incurred. Intangible assets are tested for impairment where
an indicator of impairment exists and annually in the case of intangible assets with indefinite lives, either individually or at the
cash generating unit level. Useful lives are also examined on an annual basis and adjustments, where applicable, are made
on a prospective basis.
Goodwill
Goodwill represents the excess of the cost of an acquisition over the fair value of the Consolidated Entity’s share of the net
identifiable assets of the acquired subsidiary/associate at the date of acquisition. Goodwill on acquisitions of subsidiaries is
included in intangible assets. Goodwill on acquisitions of associates is included in investments in associates. Goodwill is not
amortised, instead, it is tested for impairment annually or more frequently if events or changes in circumstances indicate that
it might be impaired and is carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity
include the carrying amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units (CGU’s) for impairment testing. CGU’s to which goodwill is allocated
as at 30 June 2022 are as follows:
– KWB Group CGU; and
– Bedshed Franchising CGU.
52
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Software development
Costs incurred in developing products or systems and costs incurred in acquiring software and licenses that will contribute
to future financial benefits through revenue generation and/or cost reduction are capitalised to software development.
Costs capitalised include external direct costs of materials and services, direct payroll and payroll related costs of employees’
time spent on the project. Amortisation is calculated on a straight-line basis over periods generally ranging from 3 to 5 years.
IT development costs include only those costs directly attributable to the development phase and are only recognised following
completion of technical feasibility and where the Consolidated Entity has an intention and ability to use the asset.
Critical Accounting Estimates and Judgements: Capital development investments
Discounted cash flow models are used for business cases. These include assumptions and estimates of business outcomes
and are used for capital investments, such as software. The Consolidated Entity has made an assessment to amortise software
development costs over 3 to 5 years.
Impairment of non-financial assets
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually
for impairment or more frequently if events or changes in circumstances indicate that they might be impaired. Other
assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may
not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its
recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For
the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable
cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash generating
units). Non-financial assets other than goodwill that have previously recognised an impairment amount are reviewed for
possible reversal of the impairment at each reporting date.
Critical Accounting Estimates and Judgements: Impairment of non-financial assets
The Consolidated Entity assesses impairment at each reporting date by evaluating conditions specific to the Consolidated Entity
that may lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined.
Value-in-use calculations performed in assessing recoverable amounts incorporate a number of key estimates and judgements.
53
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
An analysis of intangible assets is presented below.
Goodwill
Software Development
Total
2022
$’000
2021
$’000
2022
$’000
2021
$’000
2022
$’000
2021
$’000
Year ended 30 June
Net of accumulated impairment
and amortisation at 1 July
Additions
Impairment
Disposals
Amortisation
7,330
7,330
-
-
-
-
-
-
-
-
Net of accumulated impairment
and amortisation at 30 June
7,330
7,330
At 30 June
Cost (gross carrying amount)
11,734
11,734
Disposals
-
-
Accumulated impairment
(4,404)
(4,404)
Accumulated amortisation
Net carrying amount
-
7,330
-
7,330
120
207
-
-
(60)
267
387
-
-
(120)
267
180
-
-
-
(60)
120
7,450
207
-
-
(60)
7,597
7,510
-
-
-
(60)
7,450
180
12,121
11,914
-
-
(60)
120
-
-
(4,404)
(4,404)
(120)
7,597
(60)
7,450
Goodwill
Goodwill as at 30 June 2022 reflects the interest in the KWB Group, acquired in October 2014 and the value
of the Bedshed Franchising, purchased in 2006.
Software development
Software development as at 30 June 2022 reflects the value of the Group’s custom built software systems, used
to support multiple aspects of its operations.
54
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Allocation of goodwill
Goodwill is allocated to cash-generating units which are based on the Consolidated Entity’s operating segments:
Kitchen and Wardrobe Showrooms segment
Bedshed Franchise segment
2022
$’000
1,023
6,307
7,330
2021
$’000
1,023
6,307
7,330
Impairment of goodwill
The recoverable amount of each CGU is determined based on value-in-use calculations. Value-in-use is calculated based
on the present value of cash flow projections over a 5-year period with the period extending beyond the existing budget
for upcoming financial year extrapolated using estimated growth rates. The cash flows are discounted using a risk-
adjusted pre-tax discount rate.
The following assumptions were used in the value-in-use calculations:
Kitchen Showrooms segment
Bedshed Franchising segment
Pre–tax
Discount
Rate
Pre–tax
Discount
Rate
2022
9.81%
9.81%
2021
9.81%
9.81%
Growth
Rate
2022
2.41%
2.41%
Growth
Rate
2021
2.36%
2.36%
The Consolidated Entity’s value-in-use calculations incorporated a terminal value component beyond the 5-year
projection period for all the operating segments.
Impairment of goodwill for the financial year ended 30 June 2022 was $nil (2021: $nil).
Impact of possible changes in key assumptions
No reasonably possible changes in the key assumptions above would result in the carrying amount of the CGUs
exceeding their recoverable amounts.
55
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
6. LOANS AND BORROWINGS AND FINANCING FACILITIES AVAILABLE
Secured liabilities and assets pledged as security
The financing facilities are secured by first mortgages over a combination of the Consolidation Entity’s assets.
Lease liabilities are effectively secured as the rights to the leased assets recognised in the financial statements revert
to the lessor in the event of default. Refer to Note 24 in relation to lease liabilities.
Compliance with loan covenants
The Consolidated Entity has complied with the financial covenants of its financing facilities during the financial
year. The financiers assesses the financial covenants bi-annually, based on the audited annual report and reviewed
half-year report.
Financing facilities available
At reporting date, the following financing facilities had been negotiated and were available:
Current Non-current
$’000
$’000
Total
$’000
Limit
Available
Expiry Date
$’000
$’000
CBA market rate loan
(revolving facility)
CBA multi-option facility
NAB business loan
Total
-
-
-
-
-
-
-
-
-
-
-
-
4,000
4,000
30/09/2024
1,100
4,000
9,100
1,100
4,000
9,100
Subject to
annual review
31/07/2024
56
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
7. CONTINGENT LIABILITIES
At 30 June 2022, the Consolidated Entity had entered into the following guarantees:
–
–
KWB Group has retail lease bank guarantees held against the equity in the 97 Trade Street, Lytton property
as at 30 June 2022 of $1.02 million (30 June 2021: $0.96 million).
Bedshed company-owned retail stores have bank guarantees relating to payment of lease obligations
as at 30 June 2022 of $0.37 million (30 June 2021: $0.37 million).
No provision has been made in the financial statements in respect of these contingencies as the possibility
of a probable outflow under these guarantees is considered remote.
KWB Group also has cash-backed rental deposits supporting showroom leases as at 30 June 2022 of $60,000
(30 June 2021: $60,000).
Significant Accounting Policy: Financial guarantees
Where material, financial guarantees are issued. These require the issuer to make specified payments to reimburse the holder
for a loss it incurs because a specified debtor fails to make payment when due. The guarantees are recognised as a financial
liability at fair value on initial recognition.
The guarantee is subsequently measured at the higher of the amount determined in accordance with the expected credit loss
model under AASB 9 Financial Instruments and the amount initially recognised less, where appropriate, cumulative amounts
recognised in accordance with AASB 15 Revenue from Contracts with Customers. Where the Consolidated Entity gives
guarantees in exchange for a fee, revenue is recognised under AASB 15.
The fair values of financial guarantee contracts are assessed using a probability weighted discounted cash flow approach.
The probability is based on:
–
–
–
The likelihood of the guaranteed party defaulting in a given period;
The proportion of the exposure that is not expected to be recovered due to the guaranteed party defaulting; and
The maximum loss exposed if the guaranteed party were to default.
57
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
8. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS
Fair value hierarchy
The Consolidated Entity uses various methods in estimating the fair value of instruments. The methods comprise:
Level 1: The fair value is based on quoted market prices (unadjusted) in active markets for identical assets or liabilities
at the end of the reporting period.
Level 2: The fair value is determined using valuation techniques which maximise the use of observable market data
and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are
observable, the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the asset is included in level 3.
The fair value measurement, valuation technique and inputs used in fair valuing the non-financial instruments are set
out as follows:
Class of property
Assets held for sale
Office and factory, Lytton QLD
Fair value
hierarchy
Carrying
Value
June 2022
$000
Level 2
16,000
As at 30 June 2022, the Group’s corporate office and warehouse and factory facility in Lytton, Queensland, has been
recognised as an asset held for sale. Refer to Notes 15 and 30 for further details. The carrying value of the property was
determined with reference to the binding sale price of the sale and leaseback transaction announced by the Group on
22 August 2022. This was determined to best reflect the fair value of the property at 30 June 2022, prior to reclassification
to an asset ‘held for sale’. Refer to Note 30 for further details.
Significant Accounting Policy: Fair value estimation
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for
disclosure purposes.
58
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
ANNUAL FINANCIAL REPORT
YEAR ENDED
YEAR ENDED
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
30 JUNE 2021
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
9. CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash on hand and deposits held at call with other financial institutions. Refer to Note
3 in relation to the Consolidated Entity’s approach to managing the financial risks associated with cash. Bank overdrafts
are shown within borrowings in current liabilities in the Consolidated Statement of Financial Position.
Funds held in Trust
Cash and cash equivalents balances exclude funds allocated for the specific use of operating the Approved Purposes
activities on behalf of the Company’s Bedshed franchisees. Approved Purposes cash is included in Other Financial
Assets. At 30 June 2022, the total of this balance was $1.22 million (2021: $0.58 million).
For the purposes of the statement of cash flows, cash and cash equivalents are comprised of the following:
Cash at bank and on hand
10. TRADE RECEIVABLES
Current
Trade receivables
Allowance for expected credit loss
2022
$’000
2021
$’000
31,933
19,881
2022
$’000
1,083
(4)
1,079
2021
$’000
597
(6)
591
Trade and other receivables are non-interest bearing. Trade and other receivables are recognised at amortised cost, less
an allowance for expected credit loss. Each operating segment’s credit management policy requires customers to settle
amounts owing in accordance with agreed payment terms. Depending on the operating segment, trade receivables are
generally due for settlement within 30 days.
At 30 June, the ageing analysis of trade receivables is as follows:
Within one year
2022
$’000
1,079
2021
$’000
591
Other balances within trade and other receivables are neither impaired nor past due. It is expected that these other
balances will be received when due.
59
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Movements in the allowance for expected credit loss for trade and other receivables were as follows:
At 1 July
(Credit) / charge for the year
At 30 June
2022
$’000
6
(2)
4
2021
$’000
216
(210)
6
Critical Accounting Estimates and Judgements: Expected credit losses
Debtors in each of the Consolidated Entity segments have been reviewed for the potential of non-recovery. The review is based
on the lifetime expected credit loss, grouped based on days overdue and makes assumptions to allocate an overall expected
credit loss rate. These assumptions include recent sales experience, historical collection rates, the impact of the COVID-19
pandemic and forward-looking information that is available. The allowance for expected credit losses is calculated based on
the information available at the time of preparation. The actual credit losses in future years may be higher or lower.
11. INVENTORIES
Current
Stock on hand at cost
Provision for impairment(a)
2022
$’000
3,755
(573)
3,182
2021
$’000
3,360
(135)
3,225
(a) Write-downs of inventories to net realisable value recognised as an expense during the financial year amounted to $438,000 (2021: $17,000).
Significant Accounting Policy: Inventory
Inventories are stated at the lower of cost and net realisable value. Cost comprises expenditure incurred in acquiring the
inventories and in bringing them to their existing condition and location.
Costs are assigned to individual items of inventory on a basis of weighted average costs. Costs of purchased inventory are
determined after deducting rebates and discounts. Net realisable value is the estimated selling price in the ordinary course
of business less the estimated costs of completion and the estimated costs to make the sale.
Critical Accounting Estimates and Judgements: Net realisable value of inventory
In determining the dollar amount of write-downs required for inventory, the Consolidated Entity has made judgements based
on the expected net realisable value of that inventory. Historic experience and current knowledge of the products has been used
in determining any write-downs to net realisable value.
60
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
12. OTHER ASSETS
Current
Accrued revenue
Prepayments
Other receivables
Non-current
Other receivables(a)
Business establishment assets(b)
2022
$’000
253
610
205
1,068
118
517
635
2021
$’000
104
280
80
464
114
-
114
(a) Non-current other receivables are cash-backed rental deposits.
(b) Balance relates to assets that have been purchased for the Group’s new business opportunity and are expected to be ready for use early in the 2023 financial year.
Significant Accounting Policy: Investments and other financial assets
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active
market. They are included in current assets, except for those with maturities greater than 12 months after the reporting date
which are classified as non-current assets.
Subsequent measurement
Loans and receivables and held-to-maturity investments are carried at amortised cost using the effective interest method.
13. OTHER FINANCIAL ASSETS
Current
Funds held in trust
2022
$’000
2021
$’000
1,218
582
Funds held in trust relate to cash and cash equivalents allocated for the specific use of operating the Approved Purposes
activities on behalf of the Company’s Bedshed franchisees.
61
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
14. PROPERTY, PLANT AND EQUIPMENT
Year ended 30 June 2022
At 1 July 2021, net of depreciation
Additions
Disposals(a)
Depreciation charge for the year
At 30 June 2022, net of accumulated depreciation
At 30 June 2022
Cost
Accumulated depreciation
Net carrying amount
Property
and
buildings
Plant and
equipment
Leasehold
improvements
$’000
$’000
$’000
5,454
-
(5,431)
(23)
-
-
-
-
2,000
483
(43)
(722)
1,718
5,463
(3,745)
1,718
1,438
888
(28)
(593)
1,705
4,821
(3,116)
1,705
Total
$’000
8,892
1,371
(5,502)
(1,338)
3,423
10,284
(6,861)
3,423
(a)
In December 2021, the Group entered into a sale and leaseback agreement with Pollutri Nominees Pty Ltd ACN 651 818 058 as trustee for The Stanja Trust (Purchaser), for its
corporate office and warehouse facility in Osborne Park, Western Australia. The transaction settled on 16 February 2022. The sale of the property realised $5.5 million in cash
(before costs) and will lead to a more efficient allocation of the Company’s capital in accordance with the strategic direction of the business. Refer to Note 24 for further details.
62
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
ANNUAL FINANCIAL REPORT
YEAR ENDED
YEAR ENDED
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
30 JUNE 2021
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Year ended 30 June 2021
At 1 July 2020, net of depreciation
Additions
Disposals
Depreciation charge for the year
At 30 June 2021, net of accumulated depreciation
At 30 June 2021
Cost
Accumulated depreciation
Accumulated impairment
Net carrying amount
Property
and
buildings
Plant and
equipment
Leasehold
improvements
$’000
$’000
$’000
5,500
-
-
(46)
5,454
6,845
(242)
(1,149)
5,454
1,886
801
(58)
(629)
2,000
5,165
(3,165)
-
2,000
1,421
593
(36)
(540)
1,438
4,182
(2,744)
-
1,438
Total
$’000
8,807
1,394
(94)
(1,215)
8,892
16,192
(6,151)
(1,149)
8,892
Significant Accounting Policy: Property, plant and equipment
Land and buildings are shown at carrying value, based on periodic valuations completed by external, professionally qualified
valuers, less depreciation for buildings. Any accumulated depreciation at the date of revaluation is eliminated against the
gross carrying amount of the asset and the net amount is restated to the revalued amount of the asset. All other items of
property, plant and equipment are stated at historical cost less depreciation. Historical cost includes expenditure that is directly
attributable to the acquisition of the items.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item will flow to the Consolidated Entity and the cost of the item can
be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged
to the Consolidated Statement of Profit during the reporting period in which they are incurred.
Depreciation is calculated over the estimated useful life of the asset as follows:
– Plant and equipment: 1 to 20 years;
– Leasehold improvements: 3 to 15 years or shorter of lease term;
– Buildings: 30 to 50 years; and
– Motor Vehicles: 3 to 6 years.
The assets’ residual values and useful lives are reviewed and adjusted if appropriate, at each reporting date. An asset’s carrying
amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated
recoverable amount. Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These
are included in the Consolidated Statement of Profit or Loss. On the sale of revalued assets, the profit element of the revalued
amount is taken through the Consolidated Statement of Profit or Loss.
63
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
15. INVESTMENT PROPERTY
Opening balance
Fair value adjustments
Transfer to asset held for sale (Note 30)
Closing balance
Fair value measurement
2022
$’000
9,623
6,377
(16,000)
2021
$’000
9,623
-
-
-
9,623
Critical Accounting Estimates and Judgements: Treatment of investment property in Lytton, QLD
For the financial year ended 30 June 2021, the KWB Group property located in Lytton, Queensland was classified as an
investment property as the significant portion is under an operating lease to an external third-party manufacturer earning
rental income. Refer to Note 8 in relation to the fair value measurement and valuation technique used.
On 22 August 2022, the Company announced that its 51% subsidiary, KWB Group, had agreed to the sale and leaseback
of its corporate office and warehouse factory facility in Lytton, Queensland. Refer to Note 8 for further details. The sale
process commenced prior to 30 June 2022.
The carrying value of the underlying asset ($16 million) was reclassified from investment property (non-current asset)
to assets held for sale (current asset) as at 30 June 2022. Refer to Note 30 in relation to the asset held for sale.
Critical Accounting Estimates and Judgements: Revaluation of investment property
The investment property is subject to an annual review in comparison to fair market value. The review is completed by either
an independent expert or based on management’s valuation. Where appropriate, the independent valuation is performed by
an external, professionally qualified valuer who holds a recognised relevant professional qualification and has specialised
expertise in the property being valued. For the year ended 30 June 2022, the carrying value of the property was determined
with reference to the binding sale price of the sale and leaseback transaction announced by the Group on 22 August 2022.
64
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
16. TRADE AND OTHER PAYABLES
These amounts represent liabilities for goods and services provided to the Consolidated Entity prior to the reporting date
which remain unpaid. The amounts are unsecured and are usually paid within 30-45 days of recognition. Due to their
short-term nature, the carrying amounts of trade and other payables are considered to be the same as their fair values.
Unsecured liabilities
Trade payables
Sundry creditors
Contract liabilities(a)
Accruals and other payables
(a) These are deposits from customers for goods and services to be provided by the Consolidated Entity after reporting date.
17. PROVISIONS
Current
Employee benefits
Non-current
Make good provision
Employee benefits
2022
$’000
5,827
60
14,176
4,721
24,784
2022
$’000
2,884
2,884
359
225
584
Movement in provisions
The movement in provisions during the financial year is set out in the table below:
Opening balance at 1 July 2021
Additional / (amount released)
Closing balance at 30 June 2022
Employee
Benefits
Make good
provision
$’000
$’000
2,710
399
3,109
349
10
359
2021
$’000
4,318
44
10,996
4,389
19,747
2021
$’000
2,410
2,410
349
300
649
Total
$’000
3,059
409
3,468
65
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Make good provision
This provision relates to assets used in KWB’s retail kitchen and wardrobe showrooms.
Provision for employee benefits
Wages and salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled within
12 months of the reporting date are recognised in the provision for employee benefits in respect of employee services
up to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled.
Long service leave
The liability for long service leave is recognised in the provision for employee benefits at a value that considers employee
services up to the reporting date and is measured at the amounts expected to be paid when the liabilities are settled.
Significant Accounting Policy: Provisions
Provisions for legal claims, service warranties and make good obligations are recognised when the Consolidated Entity has
a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required
to settle the obligation and the amount has been reliably estimated. Provisions are not recognised for future operating losses.
Where there are several similar obligations, the likelihood that an outflow will be required in settlement is determined by
considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect
to any one item included in the same class of obligations may be small.
Where appropriate, provisions are measured at the present value of management’s best estimate of the expenditure required to
settle the present obligation at the reporting date. The discount rate used to determine the present value reflects current market
assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage
of time is recognised as interest expense.
66
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
18. ISSUED CAPITAL
Ordinary shares carry one vote per share and carry the right to dividends.
Opening share capital
Fully paid ordinary shares issued during the year
Closing share capital
Movement in ordinary shares on issue:
At 1 July 2021
Dividend reinvestment plan issues
At 30 June 2022
Significant Accounting Policy: Issued capital
2022
$’000
18,397
308
18,705
Number
28,172,284
96,320
28,268,604
2021
$’000
18,280
117
18,397
$’000
18,397
308
18,705
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. Incremental costs directly attributable to the issue of new shares or options for the acquisition of a business are
not included in the cost of the acquisition as part of the purchase consideration.
If the entity reacquires its own equity instruments, e.g. as the result of a share buy-back, those instruments are deducted from
equity and the associated shares are cancelled. No gain or loss is recognised in the Consolidated Statement of Profit or Loss and
the consideration paid including any directly attributable incremental costs (net of income taxes) is recognised directly in equity.
67
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
19. EARNINGS PER SHARE
Basic and diluted earnings per share are calculated based on a weighted average of any shares issued during the
financial year.
The following reflects the earnings and share numbers used in the continuing operations basic and diluted earnings
per share computations:
Basic earnings per share:
Net profit attributable to ordinary Joyce
shareholders from continuing operations
2022
2021
$000
9,086
7,574
Weighted average number of ordinary shares
Number
28,223,782
28,139,008
Earnings per share
Cents per share
32.19
26.92
Diluted earnings per share:
Net profit attributable to ordinary Joyce
shareholders from continuing operations
$000
9,086
7,574
Weighted average number of ordinary shares(a)(b)
Number
28,224,686
28,139,008
Earnings per share
Cents per share
32.19
26.92
(a) The ‘FY20 Performance Rights’ have been included in the denominator of the diluted shares.
(b)
The ‘FY21 and FY22 Performance Rights’ have not been included in the denominator of the diluted shares as the quantum of these rights that will vest will only be determinable
at a future date.
The Company has established a dividend reinvestment plan under which holders of ordinary shares can elect to have all
or part of their dividend entitlements satisfied by the issue of new ordinary shares rather than being paid in cash.
68
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
20. SHARE-BASED PAYMENTS
A total share-based payments expense of $1,034,776 was recognised in the year (FY21: $726,394).
(a) Key Management Personnel performance rights
The offer of performance rights is designed to provide long-term incentives for Key Management Personnel to deliver
long-term shareholder returns. The performance rights are issued under the Joyce Corporation Ltd Rights Plan with
eligible participants being granted performance rights which only vest if certain performance targets are met.
Details of the performance rights on issue are summarised below.
FY20 Rights
Beneficiary
Number of
Rights Granted
Fair Value per right
(JYC share price on
grant date)
Expected vesting date
Vesting conditions
No. of rights
expected to vest
Total fair value
$378,278
Commencement date
1 July 2019
John Bourke
Chris Palin
Gavin Culmsee
141,677
$2.67
30 June 2022
(3 years)
Profit metric
of KWB EBIT
cumulative
over 3 years(a)
112,065
$2.67
$299,214
1 July 2019
30 June 2022
(3 years)
Profit metric
of KWB EBIT
cumulative
over 3 years(a)
76,387
$1.55
$118,400
1 July 2019
30 June 2022
(3 years)
Profit metric
of Bedshed EBIT
cumulative
over 3 years(a)
141,677
112,065
76,387
(a)
The ‘FY20 performance rights’ vesting period ended on 30 June 2022, with expectations that these rights will fully vest. This will be confirmed and the corresponding share issue
ratified at the next meeting of the Remuneration Committee.
69
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FY21 Rights
Beneficiary
Daniel Madden
John Bourke
Chris Palin
Gavin Culmsee
Number of
Rights Granted
Fair Value per right
(JYC share price on
grant date)
127,002
208,448
164,879
140,484
$1.64
$2.67(c)
$2.67(c)
$1.11
Total fair value
$208,283
$556,556
$440,227
$155,937
Commencement date
1 December 2020(b)
1 July 2020
1 July 2020
1 July 2020
Expected vesting date
Vesting conditions
No. of rights
expected to vest
30 June 2023
(3 years)
Profit metric
of Group NPAT
cumulative
over 3 years(a)
30 June 2023
(3 years)
Profit metric
of KWB EBIT
cumulative
over 3 years(a)
30 June 2023
(3 years)
Profit metric
of KWB EBIT
cumulative
over 3 years(a)
30 June 2023
(3 years)
Profit metric
of Bedshed EBIT
cumulative
over 3 years(a)
63,501 - 127,002
104,224 - 208,448
82,440 - 164,879
70,242 - 140,484
(a)
The expense recognised in respect of the performance rights is based on the Board’s assessment of the probability that certain milestone earnings will be achieved, measured
cumulatively over the three-year period commencing 1 July 2021 and ending 30 June 2023. There are three milestones: “threshold”; “target”; and “stretch and above”. Meeting
these milestones results in, respectively, 25%, an additional 25%, and the final 50% of the rights vesting into ordinary shares.
(b) Daniel Madden’s contract of employment commenced on 1 December 2020 and as a result for the year 30 June 2021 only a prorated expense was recognised.
(c)
The formal grant date of the ‘FY21 performance rights’ to John Bourke and Chris Palin was determined post the 30 June 2021 year end and under the requirements of the
Australian Accounting Standards, the associated accounting expense is based on the underlying share price at formal grant date.
FY22 Market based rights
Beneficiary
Daniel Madden
Tim Allison
John Bourke
Chris Palin
Gavin Culmsee
Maximum number
of rights granted
39,613
12,413
20,664
14,089
14,521
Vesting conditions
TSR metric(a)
TSR metric(a)
TSR metric(a)
TSR metric(a)
TSR metric(a)
Fair value model inputs
Grant date
Expected life
Share price on grant date
Expected volatility (%)
Risk-free interest rate (%)
Model used
30 December 2021
3 years
$3.33
50%
0.925%
Monte Carlo
(a)
The probability of the performance rights vesting has already been taken into account in the initial valuation of the rights. Therefore the expense recognised in respect of the
market-based performance rights is based on the extent to which the vesting period has expired, within the three years commencing 1 July 2021 and ending 30 June 2024.
70
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
ANNUAL FINANCIAL REPORT
YEAR ENDED
YEAR ENDED
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
30 JUNE 2021
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FY22 Non-market based rights
Beneficiary
Daniel Madden
Tim Allison
John Bourke
Chris Palin
Gavin Culmsee
Maximum number
of rights granted
92,430
49,652
82,655
56,356
58,086
Vesting conditions
JYC ROE
metric(a)
JYC ROE
metric(a)
KWB EBIT
metric(a)
KWB EBIT
metric(a)
Bedshed EBIT
metric(a)
Fair value model inputs
Grant date
Expected life
Share price on grant date
Expected volatility (%)
Risk-free interest rate (%)
Model used
30 December 2021
3 years
$3.33
50%
0.925%
Black-Scholes
(a)
The expense recognised in respect of the performance rights is based on the Board’s assessment of the probability that certain milestone Return on Equity (ROE) or Divisional
Earnings Before Interest and Tax (EBIT) metrics will be achieved, measured cumulatively over the three-year period commencing 1 July 2021 and ending 30 June 2024. There are
three milestones: “threshold”; “target”; and “stretch and above”. Meeting these milestones results in, respectively, 25%, an additional 25%, and the final 50% of the rights vesting
into ordinary shares.
Significant Accounting Policy: Share-based payments
Schemes in place can only be equity-settled and are accounted for accordingly. The cost of equity-settled transactions with
employees is measured using their fair value at the date which they were granted. In initially determining the fair value, no
account is taken of any performance conditions.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which
any performance conditions are met, ending on the date on which the employee becomes fully entitled to the award (vesting
date). The cumulative expense recognised for these transactions at each reporting date reflects the extent to which the vesting
period has expired and the proportion of the awards that are expected to ultimately vest.
No expense is recognised for awards that do not ultimately vest due to a performance condition not being met.
Critical Accounting Estimates and Judgements: Share-based payments
The Consolidated Entity initially 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. Estimating fair value for share-based payment transactions
requires determination of the most appropriate valuation model, which is dependent on the terms and conditions of the grant.
This estimate also requires determination of the most appropriate inputs to the valuation model as well as an assessment of the
probability of achieving non-market based vesting conditions. The probability of achieving non-market based vesting conditions
of performance options is assessed at each reporting period.
71
ANNUAL REPORT FY22JOYCE CORPORATION LTD
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
21. DIVIDENDS
Dividends declared or paid during the financial year are as follows:
Ordinary shares:
FY20 final fully franked dividend of 5.0 cents per share
FY21 interim fully franked dividend of 7.0 cents per share
FY21 final fully franked dividend of 10.0 cents per share
FY22 interim fully franked dividend of 7.5 cents per share
2022
$’000
-
-
2,817
2,117
4,934
2021
$’000
1,405
1,971
-
-
3,376
Franking account balance
The amount franking credits available for subsequent financial years from continued operations are:
Franking credits available for
subsequent financial years at 30%
Consolidated
Parent entity
2022
$’000
2021
$’000
2022
$’000
2021
$’000
9,825
5,508
3,832
2,833
72
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
22. REVENUE, INCOME AND EXPENSES
(a) Revenue from continuing operations
Revenue from contracts with customers
Sale of goods
Franchise revenue
Other revenue
Rental revenue
Freight recovered
Gain on lease modification
Other revenue
Government grants
2022
$’000
123,671
5,345
129,016
681
316
-
1,117
-
2,114
2021
$’000
106,390
4,834
111,224
632
291
480
1,155
1,827
4,385
Significant Accounting Policy: Presentation of government grants
Government grants relating to JobKeeper are recognised in profit or loss in other revenue over the period necessary to match
them with the costs that they are intended to compensate.
Grants from the government are recognised at their fair value where there is a reasonable assurance that the grant will be
received and the Consolidated Entity will comply with all attached conditions.
Disaggregation of revenue
Management review the business at the level of disaggregation shown as per Note 4. The disaggregation of revenue
follows the operating segments identified, being revenue from the following activities and arrangements:
– Retail kitchen and wardrobe showrooms and retail bedding stores, revenue is earnt at the point of product delivery; and
–
Franchising, the majority of revenue is earnt through payments made by the Franchisees for the services Bedshed
provide in connection with the Franchise.
In understanding the segments, the organisation rarely considers the geographic location of the customer as being the
driver to an increased understanding.
There were no new revenue streams during the financial year ended 30 June 2022 (2021: nil).
73
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The following table lays out the facts and circumstances that pertain to the Consolidated Entity’s contracts for continuing
operations with customers and depicts how the nature, amount, timing and uncertainty of revenue and cash flows are
affected by economic factors.
Operating
segment /
Factor
Nature of
the revenue
Market
Economic
drivers of
revenue
Retail
Kitchen
Showrooms
Bedshed
Franchise
Retail
Bedding
Stores
Joyce
Corporation
Sale of goods
Franchise revenue
Sale of goods
Rental revenue
“Do It For Me”
renovations
Franchising in
specialty retail
Specialty retail
Consumer confidence;
Growth in disposable
income; and
Spend on renovations
Consumer
confidence; and
Consumer
confidence; and
Growth in
disposable income
Growth in
disposable income
Commercial
real estate
Property cycle
Contractual
arrangements
Standard
form contract
Standard
form contract
Standard
form contract
Lease agreement
Specific
revenue
recognition
criteria
Contractual
assets or
liabilities
Recognition
at the point of
product delivery
Recognition
based on business
written sales from
franchised stores
Recognition
at the point of
product delivery
Recognition is
monthly as defined
in the relevant
lease agreement
Bank guarantees,
Customer deposits
Nil
Bank guarantees,
Customer deposits
Nil
74
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(b) Expenses from continuing operations
Cost of sales
Cost of goods
Total cost of sales
Variable costs
Freight
Wages – commissions
Warranty costs
Total variable costs
Employment expenses
Superannuation contributions
Payroll tax
Wages and other employee benefits
Share-based payments (Note 20)
Total employment expenses
Net interest income / (expense)
Interest income
Interest expense
Interest expense on lease liabilities
Net interest expense
Depreciation and amortisation
Depreciation – property, plant & equipment
Amortisation – right-of-use asset
Amortisation – software
Total depreciation and amortisation
Administration expenses
IT, communications and network costs
Consultancy fees
Travel expenses
Insurance
Accounting and audit fees
Legal fees
Business establishment costs
Other administration expenses
Expected credit loss (Note 10)
Repayment of government grants
Total administration expenses
2022
$’000
2021
$’000
(61,178)
(61,178)
(397)
(7,771)
(1,909)
(10,077)
(2,276)
(1,368)
(20,523)
(1,035)
(25,202)
36
-
(489)
(453)
(1,338)
(4,107)
(60)
(5,505)
(52,417)
(52,417)
(241)
(6,613)
(1,176)
(8,030)
(1,970)
(1,133)
(18,202)
(726)
(22,031)
27
(19)
(529)
(521)
(1,215)
(3,388)
(60)
(4,663)
(1,495)
(1,174)
(328)
(331)
(340)
(315)
(129)
(448)
(1,632)
(2)
-
(5,020)
(201)
(251)
(294)
(205)
(120)
-
(1,386)
210
(1,486)
(4,907)
75
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Lease payments and other expenses included in the Consolidated Statement of Profit or Loss:
Lease payments
Significant Accounting Policy: Goods and Services Tax (GST)
2022
$’000
2021
$’000
(4,465)
(3,963)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable
from the relevant taxation authority. In this case, it is recognised as part of the cost of acquisition of the asset or as part of
the expense. Receivables and payables are stated inclusive of the amount of GST receivable or payable. The Consolidated
Statement of Cash Flows includes cash flows on a gross basis.
The net amount of GST recoverable from, or payable to, the relevant taxation authority is included with other receivables or
payables in the Consolidated Statement of Financial Position.
23. INCOME TAX
The major components of income tax expense for the financial year ended 30 June are:
Current income tax
Current income tax expense
(Over) / under provision in respect of prior years
Deferred income tax
Relating to origination and reversal of temporary differences
Under provision in respect of prior years
Income tax expense recognised in profit or loss
2022
$’000
6,382
-
2,195
63
8,640
2021
$’000
6,012
29
(67)
139
6,113
76
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
A reconciliation of income tax expense applicable to accounting profit before income tax at the statutory income tax rate
to income tax expense at the Consolidated Entity’s effective income tax rate for the financial years ended 30 June 2022
and 30 June 2021 is as follows:
Profit before income tax
Income tax expense calculated at the statutory income
tax rate of 30% (2021: 30%)
Tax effect of amounts which are non-deductible (taxable)
in calculating taxable income:
Entertainment
Share-based payments
Other items not allowed / (not assessable) for income tax purposes
Deferred tax assets not brought into account
Over provision in respect of prior years
Other permanent differences
Income tax expense recognised in profit or loss
Effective income tax rate
Significant Accounting Policy: Tax consolidation
2022
$’000
2021
$’000
26,250
19,108
7,875
5,732
19
310
-
340
63
33
8,640
33%
13
217
(66)
38
168
11
6,113
32%
Joyce Corporation Ltd and its 100%-Australian-owned subsidiaries are a tax group. Members of the Group have not entered into
any tax sharing or tax funding arrangements. At the reporting date, the possibility that the head entity will default on its tax
payment obligations is remote. The head entity of the tax group is Joyce Corporation Ltd.
Significant Accounting Policy: Measurement method adopted under UIG 1052 Tax Consolidation Accounting
The head entity and the controlled entities in the tax group continues to account for their own current and deferred tax amounts.
The Group has applied the group allocation approach in determining the appropriate amount of current taxes and deferred taxes
to allocate to members of the tax group. The current and deferred tax amounts are measured in a systematic manner that is
consistent with the broad principles in AASB 112 Income Taxes.
In addition to its own current and deferred tax amounts, the head entity also recognises current tax liabilities (or assets) and the
deferred tax assets arising from unused tax losses and unused tax credits assumed from controlled entities in the tax group.
Significant Accounting Policy: Tax consolidation contributions / (distributions)
The Consolidated Entity has recognised no consolidation contribution or distribution adjustments.
77
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The major components of deferred income tax at 30 June 2022 are as follows:
Deferred tax liabilities
Investment property / asset held for sale
Trade and other receivables
Fair value gains on other intangible assets
Right-of-use asset
Deferred tax assets
Property, plant and equipment
Trade and other payables
Other employer obligations
Provisions
Lease liabilities
Other
The major components of deferred income tax at 30 June 2021 are as follows:
Deferred tax liabilities
Investment property
Trade and other receivables
Fair value gains on other intangible assets
Right-of-use asset
Deferred tax assets
Property, plant and equipment
Trade and other payables
Other employer obligations
Provisions
Lease liabilities
Other
78
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
Opening
balance
1 July
2021
$’000
Recognised
in profit
or loss
statement
$’000
Closing
balance
30 June
2022
$’000
363
5
260
3,736
4,364
708
187
814
147
4,129
20
6,005
1,941
11
-
444
2,396
(645)
70
121
134
471
(9)
142
2,304
16
260
4,180
6,760
63
257
935
281
4,600
11
6,147
Opening
balance
1 July
2021
$’000
Recognised
in profit
or loss
statement
$’000
Closing
balance
30 June
2022
$’000
332
204
260
3,055
3,851
887
125
794
142
3,580
36
5,564
31
(199)
-
681
513
(179)
62
20
5
549
(16)
441
363
5
260
3,736
4,364
708
187
814
147
4,129
20
6,005
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Significant Accounting Policy: Deferred tax
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based on the
national income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary
differences and to unused tax losses.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred income tax is not
accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that
at the time of the transaction affects neither accounting, nor taxable profit or loss. Deferred income tax is determined using
tax rates (and laws) that have been enacted or substantially enacted by the reporting date and are expected to apply when the
related deferred income tax asset is realised, or the deferred income tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future
taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases
of investments in controlled entities where the parent entity is able to control the timing of the reversal of the temporary
differences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities
and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where
the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the
liability simultaneously.
Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity.
79
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
24. RIGHT-OF-USE ASSETS AND LEASE LIABILITIES
Right-of-use assets relates to the following:
Year ended 30 June 2022
At 1 July 2021, net of accumulated amortisation
Additions(a)(b)
Amortisation charge for the year
Variable lease payment adjustments
At 30 June 2022, net of accumulated amortisation
Property
and
buildings
$’000
Plant and
equipment
$’000
12,454
5,506
(4,107)
80
13,933
-
-
-
-
-
Total
$’000
12,454
5,506
(4,107)
80
13,933
(a)
In December 2021, the Group entered into a sale and leaseback agreement with Pollutri Nominees Pty Ltd ACN 651 818 058 as trustee for The Stanja Trust (Purchaser), for its
corporate office and warehouse facility in Osborne Park, Western Australia. The Group determined that the transaction satisfied the requirements of AASB15 to be accounted for
as a disposal/sale transaction.
In connection with the sale, the Group has also entered into arrangements with the Purchaser to retain tenancy of the office space and 1 of 3 warehouses, both areas the Group
currently occupies. The lease commenced in February 2022, with an initial term of five years (with two further five-year options). According to the new lease arrangement, the
Group has recognised a right-of-use asset value of $0.9 million an accordingly a lease liability of $0.9 million. The right-of-use asset is depreciated over 5 years on a straight line
basis. The lease liability of $0.9 million is measured at the present value of the lease payments that are not paid at the commencement date, discounted by using the incremental
borrowing rate. At June 2022, the lease liability has reduced to $0.8 million. The reduction reflected the principal portion of the lease repayments.
(b)
In June 2022, the Group entered a new lease arrangement for an eight-year lease (with a further five-year option) of a larger warehouse and office facility in Osborne Park,
Western Australia. According to the new lease arrangement, the Group has recognised a right-of-use asset value of $2.75 million an accordingly a lease liability of $2.75 million.
The right-of-use asset is depreciated over 8 years on a straight line basis. The lease liability of $2.75 million is measured at the present value of the lease payments that are not
paid at the commencement date, discounted by using the incremental borrowing rate. At June 2022, the lease liability has reduced to $2.73 million. The reduction reflected the
principal portion of the lease repayments.
Year ended 30 June 2021
At 1 July 2021, net of accumulated amortisation
Additions
Amortisation charge for the year
Modifications to lease terms
Variable lease payment adjustments
At 30 June 2021, net of accumulated amortisation
Property
and
buildings
$’000
Plant and
equipment
$’000
10,148
5,721
(3,383)
(124)
92
12,454
47
-
(5)
-
(42)
-
Total
$’000
10,195
5,721
(3,388)
(124)
50
12,454
80
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The following amounts relating to leased assets have been included as income or expense in the Consolidated Statement
of Profit or Loss and Other Comprehensive Income during the year:
Rental income (included in Other Income)
Gain on lease modification (included in Other Income)
Interest expense (included in Net Interest Expense)
Expense relating to short term leases (included in Occupancy Expense)
Expense relating to leases of low value assets that are not short-term leases
(included in Administration expenses)
Lease liabilities relates to the following:
Current
Lease liabilities
Non-current
Lease liabilities
2022
$’000
681
-
489
176
3
2021
$’000
632
480
530
73
3
2022
$’000
2021
$’000
4,890
3,974
10,443
9,788
Critical Accounting Estimates and Judgements: Leases
Determining the incremental borrowing rate
Where the interest rate implicit in a lease is not known, the Consolidated Entity is required to determine the incremental
borrowing rate, being the rate of interest the Consolidated Entity would have to pay to borrow a similar amount, over
a similar term, with similar security to obtain an asset of similar value in a similar economic environment. As this
information may not be readily available, the Consolidated Entity is required to estimate its incremental borrowing rate,
using such information as is available and adjusting reflect the particular circumstances of each lease.
Determining the lease term
The Consolidated Entity has in place a number of property leases with terms that can be renewed for an additional term,
equal to the period of the original lease. In determining the lease term, the Consolidated Entity is required to determine:
–
Whether there is an actual or implied extension or renewal option. An implied extension or renewal option will
exist if both the lessee and lessor would incur a more than insignificant penalty if the lease were not extended
or renewed; and
–
Whether the Consolidated Entity is reasonably certain to exercise any actual or implied extension options
considering all facts and circumstances relating to the lease.
Critical Accounting Estimates and Judgements: Nature of leasing activities
As a lessee
The Consolidated Entity leases a number of properties. The lease contracts provide for payments to increase each year
by a fixed percentage, to increase each year by inflation, to be reset periodically to market rental rates, or to remain fixed
over the lease term.
81
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
ANNUAL FINANCIAL REPORT
YEAR ENDED
YEAR ENDED
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
30 JUNE 2021
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
25. CAPITAL AND LEASING COMMITMENTS
The following changes to commitments have occurred during the financial year.
Retail Kitchen Showrooms segment:
–
3 new showroom leases; and
–
The renewal of 1 lease for existing showrooms.
Joyce parent entity:
–
2 new warehouse and office leases.
There were no significant changes to capital and leasing commitments in the Retail Bedding Stores segment.
82
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
26. RELATED PARTY DISCLOSURES
Ultimate controlling entity
The ultimate controlling entity of the Consolidated Entity is Joyce Corporation Ltd.
Shares held by Joyce Corporation Ltd
The consolidated financial statements include the financial statements of Joyce Corporation Ltd and the subsidiaries
listed in the following table.
Joyce International Pty Ltd
Joyce Consolidated Holdings Pty Ltd
Joyce Investments – 1 Pty Ltd
Joyce Investments 2 Pty Ltd
Joyce Investments 3 Pty Ltd
Joyce Investments 4 Pty Ltd
Sierra Bedding Pty Ltd
Bedshed Franchising Pty Ltd
KWB Group Pty Ltd
KWB Property Holdings Pty Ltd
Brisbane Investment Holdings Pty Ltd
Kitchen Connection Services (QLD) Pty Ltd
Kitchen Connection Services (NSW) Pty Ltd
Wallspan Services Pty Ltd
% Equity interest
Country of
incorporation
2022
2021
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
100
100
100
100
100
100
100
100
51
51
51
51
51
51
100
100
100
100
100
100
100
100
51
51
51
51
51
51
Critical Accounting Estimates and Judgements: Determining control of subsidiaries (AASB 10)
In determining whether the Consolidated Entity has control over subsidiaries that are not wholly owned, judgement is applied to
assess the ability of the Company to control the day-to-day activities of the partly-owned subsidiary and its economic outcomes.
In exercising judgement, the commercial and legal relationships that the Company has with other owners of partly owned
subsidiaries are taken into consideration. Changes in agreements with other owners of partly owned subsidiaries could result
in a loss of control and subsequently de-consolidation.
Upon acquisition of partly-owned subsidiaries by the Company, judgement is exercised concerning the value of net assets
acquired on the date of acquisition. The non-controlling interest’s share of net assets acquired, fair value of consideration
transferred and subsequent period movements in value thereof, are disclosed as outside equity interest.
83
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(a) Related Party Transactions
Transactions between related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated.
During the financial year, the entities of the Consolidated Entity entered into the following transactions with related parties:
Key Management Personnel compensation
Fixed remuneration employee benefits
Variable remuneration employee benefits
Post-employment benefits
Termination benefits
Share-based payments (Note 20)
Other transactions
Dividends paid to KMP
2022
$
2021
$
2,309,231
1,913,300
512,337
202,914
-
1,034,776
4,059,258
332,633
202,592
185,276
821,990
3,455,791
2022
$
2021
$
1,860,355
1,974,236
$28,695 (FY21: $8,628) of dividends payable to KMP’s were reinvested under the Company’s DRP.
Other than the items disclosed above, there are no other material related party transactions during the financial year.
(b) Non-controlling interest
The effect on the equity attributable to the owners of Joyce Corporation Ltd during the year is as follows:
Carrying amount of non-controlling interests acquired
Profits attributable to non-controlling interests
Dividends paid to non-controlling interest
Closing carrying amount of non-controlling interest
2022
$’000
3,607
8,524
(5,170)
6,961
2021
$’000
3,658
5,421
(5,472)
3,607
84
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Set out below is summarised financial information for each subsidiary that has non-controlling interests that are material
to the Consolidated Entity. The amounts disclosed for each subsidiary are before inter-group eliminations.
Statement of financial position
KWB Consolidated Group
Current assets
Current liabilities
Current net assets
Non-current assets
Non-current liabilities
Non-current net assets
Net assets
Accumulated NCI
2022
$’000
37,678
(25,847)
11,831
14,276
(11,900)
2,376
14,207
6,961
2021
$’000
14,693
(22,518)
(7,825)
25,831
(10,645)
15,186
7,361
3,607
Statement of financial performance
KWB Consolidated Group
Revenue
Profit / (loss) for the year
Total comprehensive income
Profit allocated to NCI
Dividends paid to NCI
Statement of cash flow
Cash flow from operating activities
Cash flow (used in) investing activities
Cash flow (used in) financing activities
Net increase / (decrease) in cash and cash equivalents
2022
$’000
107,957
17,396
17,396
2021
$’000
89,693
11,063
11,063
8,524
5,421
(5,170)
(5,472)
KWB Consolidated Group
2022
$’000
21,669
(1,162)
(13,814)
6,693
2021
$’000
23,569
(1,274)
(13,896)
8,399
85
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27. PARENT ENTITY DISCLOSURES
(a) Financial position – as at 30 June
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Share-based payments reserve
Retained earnings
Net equity
(b) Financial performance – for the year ended 30 June
Profit for the year
Total comprehensive profit
2022
$’000
933
27,680
28,613
1,545
4,094
5,639
2021
$’000
936
23,464
24,400
1,063
1
1,064
22,974
23,336
18,705
1,777
2,492
22,974
2022
$’000
3,229
3,229
18,397
742
4,197
23,336
2021
$’000
4,609
4,609
i. Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
No such guarantees existed as at 30 June 2022 (2021: $nil).
ii. Contingent liabilities of the parent entity
No contingent liabilities existed within the parent entity as at 30 June 2022 (2021: $nil).
iii. Commitments for the acquisition of property plant and equipment by the parent entity
No commitments existed for the acquisition of property plant and equipment by the parent entity as at 30 June 2022
(2021: $nil).
86
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
28. AUDITOR’S REMUNERATION
Auditors of the Consolidated Entity
Audit or review of the financial statements:
Group
Total audit or review of the financial statements
Non-audit services:
Taxation services
Total non-audit services
Total services provided by BDO
29. CASH FLOW STATEMENT RECONCILIATIONS
2022
$’000
2021
$’000
120,900
120,900
118,070
118,070
238,970
123,750
123,750
36,046
36,046
159,796
Reconciliation of non-cash investing and financing activities
Non-cash investing and financing activities disclosed in other notes are:
– Acquisition of right-of-use assets, refer to Note 24.
– Dividends satisfied by the issue of shares under the dividend reinvestment plan, refer to Note 18.
Reconciliation of net debt
Cash and cash equivalents
Net debt
Cash and liquid investments
Net debt
Reconciliation of net cash flow to movement in net debt:
Net debt at beginning of year
Increase in cash
Net repayment of / (increase) in long-term loans
Movements in net debt
Net debt at end of year
2022
$’000
31,933
31,933
31,933
31,933
19,881
12,052
-
12,052
2021
$’000
19,881
19,881
19,881
19,881
4,892
9,238
5,751
14,989
31,933
19,881
87
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Reconciliation of lease liability
Lease liability payable within one year
Lease liability payable after one year
Total lease liabilities
Reconciliation of net cash flow to movement in lease liability:
Lease liability at beginning of year
Lease payments in cash
Interest
Lease additions
Variable lease payment adjustments and modifications to leases
Movements in lease liabilities
Lease liabilities at end of year
Reconciliation of net profit / (loss) after tax to the net cash flows from continuing operations
Net profit after taxation
Adjustments for:
Depreciation and amortisation
Issue of shares
Share-based payments
Fair value gain on investment property revaluation
Changes in assets and liabilities:
(Increase) / decrease in inventories
(Increase) / decrease in trade and other receivables
(Increase) / decrease in other assets
(Increase) / decrease in net deferred tax assets and liabilities
(Decrease) / increase in trade and other payables
(Decrease) / increase in provisions
2022
$’000
4,890
10,443
15,333
2021
$’000
3,974
9,788
13,762
13,762
11,957
(4,465)
(3,963)
489
5,479
68
1,571
529
5,668
(429)
1,805
15,333
13,762
2022
$’000
17,610
5,505
-
1,035
(6,377)
42
(1,614)
(636)
2,254
5,539
(920)
2021
$’000
12,995
4,663
95
722
-
(251)
742
(403)
72
7,077
1,454
Net cash flows from operating activities
22,438
27,166
88
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
30. ASSETS HELD FOR SALE
On 22 August 2022, the Company announced that its 51% subsidiary, KWB Group, had agreed to the sale and leaseback
of its corporate office and warehouse factory facility in Lytton, Queensland. Refer to Note 15 for further details.
The offer was valued at $16 million (before costs) and is aligned with the strategic direction of the Company
as it continues to apply disciplined capital management and build a solid platform from which to drive its growth
ambitions further.
The carrying value of the underlying asset ($16 million) was reclassified from investment property (non-current asset)
to assets held for sale (current asset) as at 30 June 2022.
Significant Accounting Policy: Assets held for sale
Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally
through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly
probable and the asset (or disposal group) is available for immediate sale in its present condition. Management must be
committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date
of classification.
31. NEW ACCOUNTING STANDARDS AND INTERPRETATIONS NOT YET ADOPTED
a. New and amended accounting standards and interpretations adopted during the year
The accounting policies adopted are consistent with those followed in the preparation of the Group’s annual consolidated
financial statements for the year ended 30 June 2022. All new and amended accounting standards and interpretations
effective from 1 July 2021 were adopted by the Group with no material impact.
b. New and amended accounting standards and interpretations issued but not yet effective
The new and amended standards and interpretations that are issued, but not yet effective, up to the date of issuance of the
Group’s financial statements that the Group reasonably expects will have an impact on its disclosures, financial position
or performance when applied at a future date, are disclosed below. The Group intends to adopt these new and amended
standards and interpretations, if applicable, when they become effective. Of the other standards and interpretations that are
issued, but not yet effective, as these are not expected to impact the Group, they have not been listed.
Amendments to IAS 1: Classification of Liabilities as Current or Non-current
Reference to the Conceptual Framework – Amendments to IFRS 3
Property, Plant and Equipment: Proceeds before Intended Use – Amendments to IAS 16
Onerous Contracts – Costs of Fulfilling a Contract – Amendments to IAS 37
Interest Rate Benchmark Reform – Phase 2 – Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16
89
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
DIRECTORS’ DECLARATION
In the Directors’ opinion:
(a) the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards,
the Corporations Regulations 2001 and other mandatory professional reporting requirements;
(b) the attached financial statements and notes comply with the International Financial Reporting Standards as issued
by the International Accounting Standards Board as described in Note 1 to the financial statements;
(c) the attached financial statements and notes give a true and fair view of the Consolidated Entity’s financial position
as at 30 June 2022 and of its performance for the financial year ended on that date; and
(d) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable.
The Directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations Act 2001.
On behalf of the Directors
J Kirkwood
Chair
Perth, 30 August 2022
90
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A N N U A L R E P O R T F Y 2 2
AUDITORS’ REPORT
YEAR ENDED
30 JUNE 2022
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
Level 9, Mia Yellagonga Tower 2
5 Spring Street
Perth WA 6000
PO Box 700 West Perth WA 6872
Australia
INDEPENDENT AUDITOR’S REPORT
To the members of Joyce Corporation Ltd
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Joyce Corporation Ltd (the Company) and its subsidiaries (the
Group), which comprises the consolidated statement of financial position as at 30 June 2022, the
consolidated statement of profit or loss, the consolidated statement of comprehensive income, the
consolidated statement of changes in equity and the consolidated statement of cash flows for the year
then ended, and notes to the financial report, including a summary of significant accounting policies
and the directors’ declaration.
In our opinion the accompanying financial report of the Group, is in accordance with the Corporations
Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its
financial performance for the year ended on that date; and
(ii)
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia
Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO
International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability
limited by a scheme approved under Professional Standards Legislation
91
ANNUAL REPORT FY22JOYCE CORPORATION LTD AUDITORS’ REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
Carrying Value of Goodwill and Other Assets
Key audit matter
How the matter was addressed in our audit
The Group is required under Australian Accounting
Our procedures included, but were not limited to the
Standard AASB 136 Impairment of Assets (“AASB
following:
136”), to perform an annual impairment test of the
carrying value of goodwill.
As set out in note 5 in the financial statements, the
Directors’ assessment of the recoverability of goodwill
using the value in use (“VIU”) methodology requires
the exercise of significant judgement, in particular in
estimating future growth rates, discount rates and the
expected cash flows of cash generating units (“CGUs”)
to which the goodwill and other assets have been
allocated.
•
•
•
•
•
•
•
Evaluating the Group’s categorisation of CGUs and
the allocation of goodwill and other assets to the
carrying value of the CGUs based on our
understanding of the Group’s businesses;
Evaluating management’s ability to accurately
forecast cash flows by assessing the precision of the
prior year forecasts against actual outcomes;
Comparing the Group’s forecast cash flows to the
board approved budget;
Assessing management’s discount rates based on
external data available;
Performing sensitivity analysis on the growth and
discount rates;
Testing the mathematical accuracy of the
impairment models; and
Assessing the adequacy of the disclosures in note 5
in the financial statements.
92
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A N N U A L R E P O R T F Y 2 2
AUDITORS’ REPORT
YEAR ENDED
30 JUNE 2022
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2022, but does not include the
financial report and the auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon. In connection with our audit of the financial report, our
responsibility is to read the other information and, in doing so, consider whether the other information
is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise
appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our auditor’s report.
93
ANNUAL REPORT FY22JOYCE CORPORATION LTD AUDITORS’ REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 21 to 32 of the directors’ report for the
year ended 30 June 2022.
In our opinion, the Remuneration Report of Joyce Corporation Ltd, for the year ended 30 June 2022,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
BDO Audit (WA) Pty Ltd
Neil Smith
Director
Perth, 30 August 2022
94
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
ASX ADDITIONAL INFORMATION
AS AT 23 AUGUST 2022
Additional information is required by the Australian Securities Exchange Limited Listing Rules and not disclosed
elsewhere in this report. This information is provided below.
(a) Distribution of shareholders
Category
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
Rounding
Total
Fully Paid
Ordinary
Shares
106,914
561,204
676,382
4,690,270
22,233,834
Holders
234
219
88
167
40
%
0.38
1.99
2.39
16.59
78.65
0.00
748
28,268,604
100.00
There were 56 shareholders holding less than a marketable parcel of ordinary securities ($500).
(b) Substantial holders
The number of shares held or controlled at the report date by substantial shareholders were as follows:
Ordinary Shareholder
Daniel Smetana(a)
UFBA – John Roy Westwood
Total
Fully Paid
Ordinary
Shares
11,171,579
2,085,000
13,256,579
%
39.52
7.38
46.90
(a) As at 23 August 2022 Daniel Smetana has a direct interest in 10,260,400 fully paid ordinary shares (20 August 2021: 10,260,400).
(c) Voting Rights
Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or by proxy
has one vote on a show of hands.
(d) On-Market Buy-Back
There is no current on-market buy-back.
95
ANNUAL REPORT FY22JOYCE CORPORATION LTD ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
ASX ADDITIONAL INFORMATION
AS AT 23 AUGUST 2022
(e) Twenty Largest Quoted Equity Security Holders
The names of the 20 largest holders of quoted equity securities per the Group’s share register are listed below:
Name
ADAMIC PTY LTD
UFBA PTY LTD
DANIEL SMETANA
ONE MANAGED INVT FUNDS LTD <1 A/C>
1
2
3
4
5 MR DONALD TEO
6
TRAFALGAR PLACE NOMIN PTY LTD
7 MR DAN SMETANA
8
STARBALL PTY LTD
9 MR DANIEL ALEXANDER SMETANA
10
TREASURE ISLAND HIRE BOAT COMPANY PTY LTD
11 MRS JUDITH ANNA SMETANA
12 GLIOCAS INVESTMENTS PTY LTD
13 VANWARD INVESTMENTS LIMITED
14 CONARD HOLDINGS PTY LTD
15 MOAT INVESTMENTS PTY LTD
16
17
18
FELIX SMETANA
FARROW RD PTY LTD
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
19 MAN INVESTMENTS (NSW) PTY LTD
20 MARTEHOF PTY LTD
Fully Paid
Ordinary
Shares Held
7,711,568
1,800,000
1,224,651
1,055,449
990,000
980,000
734,022
653,222
563,726
504,291
497,924
411,972
388,627
347,940
333,017
307,116
285,000
271,365
219,680
214,000
%
27.28
6.37
4.33
3.73
3.50
3.47
2.60
2.31
1.99
1.78
1.76
1.46
1.37
1.23
1.18
1.09
1.01
0.96
0.78
0.76
Total
Balance of register
Grand total
19,483,570
8,775,034
28,268,604
68.96
31.04
100.00
96
J O Y C E C O R P O R A T I O N L T D
A N N U A L R E P O R T F Y 2 2
ANNUAL FINANCIAL REPORT
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED
YEAR ENDED
30 JUNE 2022
30 JUNE 2021
ASX ADDITIONAL INFORMATION
AS AT 23 AUGUST 2022
CEO and Group Company Secretary
CFO and Group Company Secretary
(e) Secretaries
Daniel Madden
Tim Allison
(f) Registered Office
75 Howe Street
Osborne Park, WA 6017
Tel: +61 8 9445 1055
(g) Share Registry
Computershare Investor Services Pty Ltd
Level 11
172 St Georges Terrace
Perth, WA 6000
(Within Australia) 1300 850 505
(Outside Australia) +61 3 9415 4000
(h) Auditors
BDO Audit (WA) Pty Ltd
Level 9, Mia Yellagonga Tower 2
5 Spring Street
Perth, WA 6000
Tel: +61 8 6382 4600
97
ANNUAL REPORT FY22JOYCE CORPORATION LTD
ABN: 80 009 116 269
Email: investors@joycecorp.com.au
Website: joycecorp.com.au
Tel: +61 8 9445 1055
75 Howe Street
Osborne Park, WA 6017 Australia