(Formerly known as Australian Whisky Holdings Limited)
ABN 62 104 600 544
Annual Report – 30 June 2020
1
For personal use only Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Corporate directory
30 June 2020
Directors
Mr David Dearie (Chairman)
Mr Geoff Bainbridge (Managing Director)
Mr Warren Randall (Non-Executive Director)
Mr Laurent Ly (Non-Executive Director)
Ms. Laura McBain (Non-Executive Director)
Company secretary
Melanie Leydin
Registered office
Principal place of business
Auditor
Level 1
30 Argyle Street
Hobart TAS 7000
Level 1
30 Argyle Street
Hobart TAS 7000
Deloitte
Level 8
22 Elizabeth Street
Hobart TAS 7000
Stock exchange listing
Lark Distilling Co. Ltd shares are listed on the Australian Securities Exchange (ASX
code: LRK)
2
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Contents
30 June 2020
Letter from the chairman
Review of operations
Directors' report
Auditor's independence declaration
Statement of profit or loss and other comprehensive income
Statement of financial position
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
Directors' declaration
Independent auditor's report to the members of Lark Distilling Co. Ltd
Shareholder information
4
6
7
20
21
22
23
24
25
52
53
57
3
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Letter from the chairman
30 June 2020
Dear Shareholders,
This has been an incredible year of challenges for Australian business and the general population. The dreadful fires that
impacted so much of Australia at the start of the year have been followed by the devastating impact from COVID19. I
therefore trust that this finds you safe and healthy.
Your board and executive team have faced these challenges head-on and I would like, on behalf of the board to, place on
record our thanks and appreciation for the incredible resilience, energy, dedication and commitment shown from the Lark
employees.
Our Managing Director, Geoff Bainbridge, has worked tirelessly to ensure that the communications to and from the
executive team, the board, the shareholders and investors has been timely, frequent and relevant. Unfortunately, due to
travel restrictions, Geoff and the Board have been unable to visit Tasmania since February this year. However, the Board
and Executives have been regularly communicating via video conference calls.
Obviously, our business has been impacted by COVID19, however we quickly adapted the operations, production and
company protocols to ensure the safety of our employees and partners. As a result of these swift actions we successfully
managed operations through strict COVID19 restrictions with no impact to production output.
The on-premise, hospitality and cellar door sectors generate an important and material percentage of our revenue, these
parts of the business have either been closed completely or operating under reduced capacity, as a result, our growth for
the year has been impacted. However, despite these challenges Lark’s revenues from ordinary activities are up 34.5% to
$7,426,458.
Lark continued its focus of production and investment in whisky inventories, reporting a 54% increase on its 1st July 2019
opening balance, through efficiency yields and the addition of a 2nd shift at its Cambridge site maximising new make
spirit production. The Group closed out the year with total whisky inventories under maturation of 711,313 litres, at a cost
of $16.74m and a maturation value of $98.8m. The maturation market value is based on an estimated future net sales
value which is equal to what the Group’s net sales value achieved today.
Management continued to drive its focus on the Lark brand by divesting non-core assets through the sale of the Overeem
Single Malt Whisky trademark and limited whisky inventory on the 19th February 2020 and execution of a share/inventory
swap with Old Kempton Distillery on 8 April 2020.
In June the executive team designed, built and commissioned a new column still at a cost of approximately $743k for the
production of a new whisky product line, working title AX8, as well as the base alcohol for Forty Spotted Gin and Lark
Sanitiser. This was an exceptional effort from the whole Lark team in partnership with Kolmark Tasmania and has
effectively doubled the distilling capacity.
In order to support our future growth plans and further improve the balance sheet position the Group obtained access to
$5m of debt funding on the 14th March 2020, through a facility provided by its largest shareholder Quality Life Pty Ltd. I
appreciate the support for Lark shown from Bruce Neil through Quality Life Pty Ltd.
The company’s strategic plan essentially highlight’s two key priorities being one to build and laydown inventory which will
provide sustainable future revenues and profits, and two investing in building the Lark brand into a globally recognised
and loved Tasmanian Whisky icon.
As identified above we have invested in and improved efficiencies throughout the distilling process. As a result, our
inventory is growing at the levels required to support the launch of several distinctive tiers of whisky within the Lark brand.
The price points and profitability of these tiers varies significantly however all inventory is recorded at cost with maturation
value of almost $100m at the end of F20.
This was an active year which brought about a name change from Australian Whisky Holdings Limited (AWY) to Lark
Distilling Company Limited (LRK), as shareholders you approved a new company constitution and a share consolidation.
The vision for Lark Distilling Co. was finalised and communicated to employees, partners, shareholders and the
investment community. I am delighted that this exciting vision is being executed and brought to life everyday by our
dedicated team.
The company has also undertaken changes to our brand building approach during the year. The main focus remains on
building the Lark Brand however we also continue to invest behind Forty Spotted Gin and Nant Whisky. Lark undertook
4
For personal use only Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Letter from the chairman
30 June 2020
significant marketing investment throughout the year and the Group undertook its first ever National advertising campaign
for Lark Whisky, designed to raise domestic brand awareness and provide support to key off premise accounts. The early
results of this brand building investment are encouraging.
To further support our brand building initiatives, we are implementing a direct distribution model, Lark ceased the
mainland Australia distribution arrangement with Proof & Co. effective 1 July 2020, with the direct model now under the
leadership of Head of Sales, Phil Henderson. This direct model provides Lark Distilling Company with greater influence
and control of all elements of the sales process. We thank Proof & Co for their past sales endeavours.
Innovation and sector leadership drives our strategy and the executive team led by Chris Thompson (Head Distiller),
Craig Johnstone (Head Operations) and Demetrius Giouzelis (Head of Brand) have developed the first Tasmanian
blended whisky known as Lark Symphony No 1 and have laid down the first AX8 barrels for future release. These and
similar exciting projects will continue to optimise the returns and profitability of our aging inventory.
Building outstanding brands requires a balanced approach and investment across a wide range of initiatives including our
hospitality offerings. Dan Knight joined the executive team in November 2019 to lead and drive our hospitality program.
Dan has a wonderful pedigree and due to the reputation and potential of our brands we are fortunate to have talent such
as Dan Knight and Phil Henderson, mentioned above.
We consider hospitality as a vital element to building sustainable and profitable brands. It is incredibly important that
visitors to our cellar door(s) enjoy outstanding levels of service across a board range of activities from educational
seminars’ and tastings, to simply relaxing and enjoying our fine whiskies and gins in venues that reflect the image,
authenticity and luxury nature of our brands.
Dan quickly assessed our hospitality, presented a road map to success successful and restructured our focus and
offering. In November of 2019 we opened the Lark Experience at Brooke Street Pier, with early sales exceeding
expectations. We completed the fit out of the new Forty Spotted Gin Bar and office location. However, COVID19 has
impacted these operations. We are hopeful that the Gin Bar will open in November to coincide with the dynamic Forty
Spotted Gin Relaunch. Brooke Street Pier is planned to reopen towards the end of 2020.
I am delighted that we secured the services of Laura McBain as an independent Non-Executive Director. Laura’s vast
experience, commitment and local Tasmanian connections are already proving to be invaluable.
I am also delighted that in June 2020 we secured Alex Aleksic as Chief Financial Officer, already we are seeing the
benefits from having Alex and his team on board. Alex has quickly established relationships with the new Auditor Deloitte
and with our Company Secretary Melanie Leydin from Leydin Freyer. Alex and his finance team are busy improving the
quality of our dashboards and suite of information services to all departments of the business, whilst ensuring ongoing
corporate governance continues.
The global spirits category has witnessed significant growth during the past few months as consumer consumption
behaviours change from on-premise to more at home consumption. The evidence suggests that premium spirit
consumption will continue to grow which bodes well for the outlook of your Company.
Finally, we appreciate your on-going support of Lark Distilling Company.
Sincerely yours,
David Dearie
Chairman
5
For personal use only Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Review of operations
30 June 2020
Review of operations – 2020
Lark undertook significant marketing investment throughout the year which resulted in sales revenues for the year ended
30 June 2020 being 34% higher than the previous corresponding period. The sales growth for the June quarter was 45%
higher year on year to $2.2m. The Group undertook its first ever National advertising campaign for Lark Whisky,
designed to raise domestic brand awareness and provide support to key off premise accounts.
Implementing a direct distribution model, Lark ceased the mainland Australia distribution arrangement with Proof & Co.
effective 1 July 2020, with the direct model now under the leadership of Head of Sales, Phil Henderson.
Lark continued its focus of production and investment in whisky inventories, reporting a 54% increase on its 1st July 2019
opening balance, through efficiency yields and the addition of a 2nd shift at its Cambridge site maximising new make spirit
production.
The Group closed out the year with total whisky inventories under maturation of 711,313 litres, at a cost of $16.74m and a
maturation value of $98.8m. The maturation market value is based on an estimated future net sales value which is equal
to what the Group’s net sales value achieved today. The market value presented has an inherent risk in that the
estimated net sales value will be achieved on maturation, therefore consideration needs to be given to market conditions
at that point in time.
The June quarter saw the completion of a new column still at a cost of approximately $743k for the production of a new
whisky product line, working title AX8, as well as the base alcohol for Forty Spotted Gin and Lark Sanitiser.
Management continued to drive its focus on the Lark brand by divesting non-core assets through the sale of the Overeem
Single Malt Whisky trademark and limited whisky inventory on the 19th February 2020 and execution of a share/inventory
swap with Old Kempton Distillery on 8 April 2020.
In order to support future growth plans and further improve the balance sheet position the Group obtained access to $5m
of debt funding on the 14th March 2020, through a facility provided by its largest shareholder Quality Life Pty Ltd.
Financial Position
The net assets of Lark remain strong at $37.38 million as at 30 June 2020 (a decrease of $0.66 million from 30 June
2019). This decrease is largely due to the following:
Net loss for year of $1.28 million; driven by the following:
a) Gross profit of $4.04 million;
b) Other income of $0.75 million;
c) Operating expenses of $5.90 million;
d) Net finance costs of $0.17 million.
Lark’s working capital, being current assets less current liabilities, is $9.00 million at 30 June 2020 (30 June 2019:
$11.69 million).
Net cash outflows utilised in funding operating activities during the year was $3.53m. However, this included
$7.89 million in inventory costs paid to lay down new make spirit for future sale. The inventory payments
represent a significant investment in the Group’s inventory to underpin future revenue streams.
6
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter
as the 'Group') consisting of Lark Distilling Co. Ltd (referred to hereafter as the 'company' or 'parent entity') and the entities
it controlled at the end of, or during, the year ended 30 June 2020.
Directors
The following persons were directors of Lark Distilling Co. Ltd during the whole of the financial year and up to the date of
this report, unless otherwise stated:
Mr Geoff Bainbridge (Managing Director)
Mr David Dearie (Chairman) (appointed Executive Chairman for period 4 October 2019 to 1 May 2020, Non-executive
Chairman from that day forward)
Mr Warren Randall (Non-Executive Director)
Mr Laurent Ly (Non-Executive Director) (appointed 2 September 2019)
Ms. Laura McBain (Non-Executive Director) (appointed 25 May 2020)
Principal activities
The principal activities of the Group during the year ended 30 June 2020 were in the further development of investment
opportunities in the Australian craft distilling industry and management of current equity investments in this industry,
including the operation of the Lark, Nant, and Forty Spotted Distilleries.
Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
Significant changes in the state of affairs
On 2 September 2019 Lark Distilling Co. announced the appointment of Laurent Ly as a Non-Executive Director.
On 12 September 2019 Lark Distilling Co. announced the appointment of Melanie Leydin as Company Secretary,
concurrent with the resignation of Gary Stewart as Company Secretary.
On 4 October 2019 Lark Distilling Co. announced the appointment of Geoff Bainbridge and David Dearie into Executive
Director roles. Mr Bainbridge took the position of Managing Director, while Mr Dearie took up the position of Executive
Chairman.
Also on this date, Lark Distilling Co. announced the issue of 31,800,000 performance rights (pre-consolidation) and
35,400,000 performance rights (pre-consolidation) to Mr Bainbridge and Mr Dearie, respectively, subject to shareholder
approval.
On 19 February 2020 Lark Distilling Co. signed binding Heads of Agreement for the sale of the Overeem Single Malt
Whisky trademark to its founding family for the sum of $962,000 with settlement on 29th June 2020.
On 13 March 2020 Lark Distilling Co. secured $5m debt facility to strengthen the balance sheet for the term of 5 years
after initial drawdown.
On 16 March 2020 Lark Distilling Co. closed its small parcel share sale facility for holdings of shares valued at less than
$500.
On 3 April 2020 Lark Distilling Co. finalised its consolidation of its securities on a 30 for 1 basis, resulting in 1,633,594,998
shares being consolidated into 54,453,167 shares.
On 9 April 2020 Lark Distilling Co. executed a Buy-Back Agreement with Old Kempton Distillery (OKD) whereby OKD will
buy-back Lark Distilling Co.’s’s 12% share of OKD (acquired in 2016) in return for 12% of the current whisky inventory of
OKD with immediate effect .
7
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
On 15 April 2020 the Company announced that it had changed its name from Australian Whisky Holdings Limited to Lark
Distilling Co. Limited, following shareholder approval sought at the Company’s Annual General Meeting held on 15 April
2020.
On 25 May 2020 Lark Distilling Co. announced the appointment of Ms. Laura McBain as a Non-Executive Director.
There were no other significant changes in the state of affairs of the Group during the financial year.
Matters subsequent to the end of the financial year
On 3 July 2020 Lark Distilling Co. announced the appointment of Alex Aleksic as the Chief Financial Officer of the group.
On 18 September 2020, Lark Distilling Co. successfully raised A$8.85 million via an institutional placement of shares.
Total shares issued as part of this placement were 8,052,334 at a price of $1.10 per share. The proceeds raised under
the placement will be used to fund the inventory build of Lark’s whisky under maturation. The new shares issued were
settled on 22 September 2020
No other matter or circumstance has arisen since 30 June 2020 that has significantly affected, or may significantly affect
the Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
Likely developments and expected results of operations
Information on likely developments in the operations of the Group and the expected results of operations have not been
included in this report because the directors believe it would be likely to result in unreasonable prejudice to the Group.
Environmental regulation
The consolidated Group’s operations are not subject to significant environmental regulation under a law of China, or of
the Commonwealth or of a state or territory of Australia. During the financial year, the Directors have not been notified or
are aware to be in breach of any environmental regulations.
Information on directors
Name:
Title:
Qualifications:
Experience and expertise:
Mr David Dearie
Chairman (appointed Executive Chairman for period 4 October 2019 to 1 May 2020,
Non-executive Chairman from that day forward)
MHCIMA, Glasgow College of Food and Technology, Institute of Marketing Diploma,
University of Hull
A global beverage industry leader with over 30 years experience in alcohol retailing,
distribution and brand building. Founding CEO of Treasury Wines estates Ltd (TWE),
and senior executive positions with Fosters Group Ltd and Brown-Forman.
None
Other current directorships:
Former directorships (last 3 years): None
Special responsibilities:
Interests in shares:
Interests in rights:
Member of the Remuneration and Nomination Committee.
None
1,180,000 performance rights
8
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
Experience and expertise:
Name:
Title:
Qualifications:
Mr Geoff Bainbridge
Managing Director
Bachelor of Business from RMIT with a major in Accounting and ASIC Graduate
Certificate in Applied Finance
Over 10 years at Fosters Group Pty Ltd with experience in group strategy and
business development in Australia, China, India and Vietnam; and Managing Director
for the domestic Continental Sprits business. Sales and marketing specialist across
a portfolio of brands including founding partner of Grill’d Burgers, Bounce
Trampolines, Happy Socks and Studio Ongarato and extensive experience in
business and people strategy across multiple sectors and geographies.
Other current directorships:
None
Former directorships (last 3 years): None
None
Special responsibilities:
3,069,033 (shares are held by GJ Bainbridge Pty Ltd (Bainbridge Super No. 1) and
Interests in shares:
Bainbridge Family Pty Ltd (Bainbridge Family A/C))
1,060,000 performance rights
Interests in rights:
Mr Warren Randall
Name:
Non-Executive Director
Title:
Bachelor of Agricultural Science & Wine Science
Qualifications:
42 years in the Australian Wine Industry
Experience and expertise:
Other current directorships:
None
Former directorships (last 3 years): None
Special responsibilities:
Interests in shares:
Interests in rights:
Chair of Remuneration and Nomination Committee
2,389,925 (shares are all held by Seppeltsfield Pty Ltd (Seppeltsfield Estate A/C))
300,000 performance rights
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Mr Laurent Ly
Non-Executive Director
Master’s Degree in Management from Dauphine University, a post graduate degree
in International Management from the Sorbonne University and a post graduate
degree in Finance from ESCP-EAP
Laurent is the founder of Spica Capital a Hong Kong based food and beverage
focused investment holding company with investments ranging from alcoholic
beverages to restaurants, bakery and vending machines. Prior to Spica, Laurent
spent 11 years in Corporate Finance in the consumer & retail investment banking
division of Lehman Brother and Nomura in London and Hong Kong , where he
advised clients across a wide range of M&A and financing transactions in food and
beverages, retail and hospitality in Europe and Asia.
Laurent is a Board member of Pirata Group, Eric Kayser Hong Kong and Daimon
Brewery.
Former directorships (last 3 years): None
Special responsibilities:
Interests in shares:
Interests in rights:
Member of Audit and Risk Committee
4,748,389 (shares all held by Ace Cosmo Developments Limited)
300,000 performance rights
9
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
Name:
Title:
Experience and expertise:
Ms. Laura McBain
Non-Executive Director
Laura was formerly Managing Director of Longtable Group Limited from 2017 to 2019
and the CEO and Managing Director of Bellamy’s Australia Ltd from 2014 to 2017,
prior to which she was CEO/General Manager since 2007. During her years with
Bellamy’s, Laura oversaw significant change, innovation and business growth
including expansion into South East Asia and China. She is currently a director of
Export Finance Australia, a role held since 2014.
Prior to joining Bellamy’s, Laura practised as an accountant in both Sydney and
Tasmania. Laura holds a Bachelor of Commerce, in 2013 completed the IMD
Leadership Challenge and completed the IESE, Wharton and CEIBS Global
executive program in 2017. In 2013, Laura was named the Telstra Tasmanian
Business Woman of the Year and went on to be named the Telstra Australian
Business Woman of the Year for 2013 (Private and Corporate).
None
Other current directorships:
Former directorships (last 3 years): Maggie Beer Holdings Limited (ASX:MBH) (resigned 27 November 2019)
Special responsibilities:
Interests in shares:
Chair of Audit and Risk Committee
11,000 (shares all held by Vermilion 21 Pty Ltd (McNelhaus Super Fund A/C))
'Other current directorships' quoted above are current directorships for listed entities only and excludes directorships of all
other types of entities, unless otherwise stated.
'Former directorships (last 3 years)' quoted above are directorships held in the last 3 years for listed entities only and
excludes directorships of all other types of entities, unless otherwise stated.
Chief Financial Officer
Mr. Alex Aleksic, CPA
Alex Aleksic holds a Bachelor of Business (Accountancy) & Master of Business Administration from RMIT. He is a
member of CPA Australia. He is a senior business strategist and advisor with more than 20 years experience in
commercial, operational and financial roles within multinationals, ASX Top 50 organisations, Private Equity and High
Networth ownership structures. He was Chief Financial Officer at Accent Group Ltd and Shaver Shop Ltd. Alex has held
numerous senior multi-discipline roles within Goodyear Dunlop (Beaurepaires), Telstra, Coles and Kodak Australasia.
Company secretary
Ms Melanie Leydin – BBus (Acc. Corp Law) CA FGIA
Melanie Leydin holds a Bachelor of Business majoring in Accounting and Corporate Law. She is a member of the Institute
of Chartered Accountants, Fellow of the Governance Institute of Australia and is a Registered Company Auditor. She
graduated from Swinburne University in 1997, became a Chartered Accountant in 1999 and since February 2000 has
been the principal of Leydin Freyer. The practice provides outsourced company secretarial and accounting services to
public and private companies across a host of industries including but not limited to the Resources, technology,
bioscience, biotechnology and health sectors.
Melanie has over 25 years’ experience in the accounting profession and over 15 years as a Company Secretary. She has
extensive experience in relation to public company responsibilities, including ASX and ASIC compliance, control and
implementation of corporate governance, statutory financial reporting, reorganisation of Companies and shareholder
relations.
10
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
Meetings of directors
The number of meetings of the company’s Board of Directors (‘the Board’) held during the year ended 30 June 2020, and
the number of meetings attended by each director were:
Mr David Dearie
Mr Geoff Bainbridge
Mr Warren Randall
Mr Laurent Ly
Ms. Laura McBain
Directors’ Meetings
Held
Attended
Audit and Risk Committee
Attended
Held
13
13
10
12
-
13
13
13
13
-
2
2
-
1
-
2
2
-
1
-
Held: represents the number of meetings held during the time the director held office.
Remuneration report (audited)
The remuneration report details the key management personnel remuneration arrangements for the Group, in accordance
with the requirements of the Corporations Act 2001 and its Regulations.
Key management personnel are those persons having authority and responsibility for planning, directing and controlling
the activities of the entity, directly or indirectly, including all directors.
Remuneration Policy
The remuneration policy of the Company has been designed to align key management personnel objectives with
shareholder and business objectives. The board of the Company believes the remuneration policy to be appropriate and
effective in its ability to attract and retain the best key management personnel to run and manage the consolidated group,
as well as create goal congruence between directors, executives and shareholders.
The board’s policy for determining the nature and amount of remuneration for key management personnel of the
consolidated group is as follows:
●
●
●
The remuneration policy, setting the terms and conditions for the key management personnel, was developed by the
remuneration committee and approved by the board after seeking professional advice from independent external
consultants.
All key management personnel receive a base salary (which is based on factors such as length of service and
experience), superannuation, fringe benefits, with the potential for options and other incentives. Options to be issued
at the discretion of the Board.
The remuneration committee reviews key management personnel packages annually by reference to the
consolidated group’s performance and executive performance.
The performance of key management personnel is reviewed annually and is based predominantly on the forecast growth
of the consolidated group’s profits and shareholders’ value. All bonuses and option incentives are issued at the discretion
of the Board. Any incentives or bonuses must be justified by reference to measurable performance criteria. The policy is
designed to attract the highest calibre of other key management personnel executives and reward them for performance
that results in long-term growth in shareholder wealth.
Key management personnel are also entitled to participate in the employee share and option arrangements
The key management personnel receive a superannuation guarantee contribution required by the government, which is
currently 9.5%, and do not receive any other retirement benefits. Some individuals, however, may choose to sacrifice part
of their salary to increase payments towards superannuation.
All remuneration paid to key management personnel is valued at the cost to the company and expensed, shares given to
key management personnel are valued as the difference between the market price of those shares and the amount paid
by key management personnel. Options are valued using the Black- Scholes methodology.
11
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
The board policy is to remunerate non-executive directors at market rates for time, commitment and responsibilities. The
Company’s constitution and the ASX Listing Rules specify that the aggregate remuneration of non executive directors
shall be determined from time to time by a general meeting. An amount not exceeding the amount determined is then
divided between the directors as agreed. The latest determination was as outlined in the Company’s Initial Public Offering
prospectus of $300,000 per annum.
The amount of aggregate remuneration sought to be approved by shareholders and the manner in which it is apportioned
amongst directors is reviewed annually. The board considers advice from external parties as well as the fees paid to non
executive directors of comparable companies when undertaking the annual review process. Fees for non-executive
directors are not linked to the performance of the consolidated group. However, to align directors’ interests with
shareholder interests, the directors are encouraged to hold shares in the company and are able to participate in the
employee option plan.
Key Management Personnel Remuneration Policy
The board seeks to set aggregate remuneration at a level which provides the company with the ability to attract and retain
key management of the highest calibre, whilst incurring a cost which is acceptable to shareholders.
The remuneration structure for key management personnel is based on a number of factors, including length of service,
particular experience of the individual concerned, and overall performance of the company. The contracts for service
between the company and key management personnel are on a continuing basis, the terms of which are not expected to
change in the immediate future. Upon retirement key management personnel are paid employee benefit entitlements
accrued to date of retirement.
Details of remuneration
Amounts of remuneration
Details of the remuneration of key management personnel of the Group are set out in the following tables.
The key management personnel of the Group consisted of the following directors of Lark Distilling Co. Ltd:
● Mr David Dearie (Chairman) (appointed Executive Chairman for period 4 October 2019 to 1 May 2020, Non-executive
Chairman from that day forward)
● Mr Geoff Bainbridge (Managing Director)
● Mr Warren Randall (Non-Executive Director)
● Mr Laurent Ly (Non-Executive Director) (appointed 2 September 2019)
● Ms. Laura McBain (Non-Executive Director) (appointed 25 May 2020)
And the following persons:
● Mr Alex Aleksic (Chief Financial Officer) (appointed 3 July 2020)
●
Mr Brendan Waights (Chief Financial Officer) (resigned 31 August 2019)
12
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-based
payments
Cash salary
and fees
$
Cash
bonus
$
Non-
Super-
monetary
annuation
$
$
Long service
leave
$
Equity-
settled
$
Total
$
50,000
41,667
4,167
122,917
324,247
-
121,953
664,951
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
10,490
10,490
-
-
-
-
-
-
-
-
47,670
47,670
-
97,670
89,337
4,167
187,501
168,433
310,418
492,680
-
-
451,274
-
132,443
1,126,715
2020
Non-Executive Directors:
Mr Warren Randall (g)
Mr Laurent Ly (a)
Ms. Laura McBain (b)
Executive Directors
Mr David Dearie (d)
Mr Geoff Bainbridge (c)
Other KMP
Mr Alex Aleksic (e)
Mr Brendan Waights (f)
(a)
(b)
(c)
(d)
(e)
(f)
(g)
Mr Laurent Ly was appointed 2 September 2019. Fees for the period were paid through director services
company Spica Capital on behalf of Laurent Ly.
Ms Laura McBain was appointed 25 May 2020
Mr Geoff Bainbridge was appointed into the executive role of Managing Director effective 4 October 2019
Mr David Dearie was appointed into the executive role of Executive Chairman effective 4 October 2019 to 1
May 2020, Non-executive Chairman from that day forward.
Mr Alex Aleksic was appointed 3 July 2020
Mr Brendan Waights resigned 31 August 2019. The cash salary figure above includes $71,250 paid in
relation to Mr Waights resignation.
The Group made purchases amounting to $73,084 (June 2019: NIL) from an entity associated with Mr Warren
Randall (Non-Executive Director). These transactions were for the purchase of wooden barrels from
Seppeltsfield Wines Pty Ltd (ABN: 97 127 078 282) for the Group to use in its’ production process of Lark.
These transactions are considered to be arms-length transactions.
13
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
Short-term benefits
Post
employment
benefits
Long-term
benefits
Share-based
payments
Other
benefits
2019
Cash salary
and fees
$
Cash
bonus
$
Non-
Super-
monetary
annuation
$
$
Long service
leave
$
Equity-
settled
$
$
Total
$
Mr Terry
Cuthbertson (c)
Mr Peter Herd (c)
Mr Gary Mares (c)
Mr Rohan Boman
(b)
Mr Christopher
Malcolm (e)(h)
Mr Brendan
Waights (f)
Mr Gary Stewart
Mr David Dearie(a)
Mr Geoff
Bainbridge (d)
Mr Warren Randall
(d)
Mr Stuart Grant (g)
Mr Bill Lark (g)
66,734
40,040
40,040
18,375
107,813
197,489
56,600
9,369
8,817
5,511
13,790
80,044
644,622
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
18,761
-
-
-
-
-
7,499
26,260
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
66,734
40,040
40,040
18,375
166,667
274,480
-
-
-
-
-
-
-
166,667
216,250
56,600
9,369
8,817
5,511
13,790
87,543
837,549
(a) Appointed as a Director on 20 May 2019.
(b) Ceased being a Director on 27 November 2018.
(c)
Ceased being a Director on 20 May 2019.
(d) Appointed as a Director on 21 May 2019.
(e) Mr Malcolm’s contract as Chief Executive Officer was terminated on 11 February 2019. The other benefit disclosed
is a 12 month termination payment.
(f) Appointed as Chief Financial Officer on 15 October 2018.
(g) Appointed as a Director on 1 February 2019, ceased as a Director on 21 May 2019.
(h) The Group made purchases total $286,186 from entities associated with Mr Chris Malcolm during his tenure as Chief
Executive Officer. These include sale of finished goods for $1,666, payments for the cooperage of wood (casks) for
$280,845 and the purchase of barrels from related entities for $70,798. These transactions are considered to be
arms-length transactions.
Service agreements
Remuneration and other terms of employment for key management personnel are formalised in service agreements.
Details of these agreements are as follows:
Name:
Title:
Agreement commenced:
Details:
Mr David Dearie
Executive Chairman
Effective 4 October 2019 to 1 May 2020
Remuneration: $150,000 per annum
Time commitment: approximately 10 days per month
Executive role responsibilities: development of strategy; investor relations; support
executive director
In addition to the above, Mr Dearie was issued 35,400,000 (pre 30-for-1
consolidation) Performance Rights (Rights) with the following terms and conditions,
and with an expiry of 31 December 2026:
14
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
Tranche no.
Tranche 1
Tranche 2
Tranche 3
Tranche 4
Tranche 5
Target market
share price* and continuous service to:
$0.045 31 December 2020
$0.055 31 December 2021
$0.065 31 December 2022
$0.075 31 December 2022
$0.085 31 December 2023
Performance
rights to vest*
1,500,000
1,800,000
2,100,000
12,000,000
18,000,000
* Share price and number of performance rights are prior to 30-for-1 consolidation completed in April 2020
Name:
Title:
Agreement commenced:
Term of agreement:
Details:
Tranche no.
Tranche 1
Tranche 2
Tranche 3
Tranche 4
Tranche 5
Mr Geoff Bainbridge
Managing Director
4 October 2019
No fixed term
Remuneration: $300,000 per annum
Time commitment: 3 days per week
Executive role responsibilities: direct management and oversight of operations;
investor relations In addition to the above, Mr Bainbridge was issued 31,800,000
Performance Rights (Rights) with the following terms and conditions and with an
expiry date of 31 December 2026:
Target market
share price* and continuous service to:
$0.045 31 December 2020
$0.055 31 December 2021
$0.065 31 December 2022
$0.075 31 December 2022
$0.085 31 December 2023
Performance
rights to vest*
3,000,000
1,500,000
1,800,000
10,500,000
15,000,000
* Share price and number of performance rights are prior to 30-for-1 consolidation completed in April 2020
Name:
Title:
Agreement commenced:
Term of agreement:
Details:
Name:
Title:
Agreement commenced:
Term of agreement:
Details:
Name:
Title:
Agreement commenced:
Term of agreement:
Details:
Mr Warren Randall
Non-Executive Director
21 May 2019
No fixed term
Remuneration: $50,000 annual directors fee (excluding GST)
Mr Laurent Ly
Non-Executive Director
2 September 2019
No fixed term
Remuneration: $50,000 annual directors fee (excluding GST)
Ms Laura McBain
Non-Executive Director
1 June 2020
No fixed term
Remuneration: $50,000 annual directors fee (excluding GST)
Key management personnel have no entitlement to termination payments in the event of removal for misconduct.
Share-based compensation
Issue of shares
There were no shares issued to directors and other key management personnel as part of compensation during the year
ended 30 June 2020.
15
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
Performance rights
Details of performance rights over ordinary shares granted, vested and lapsed for directors and other key management
personnel as part of compensation during the year ended 30 June 2020 are set out below:
Name
Grant date
Vesting date
granted*
granted
$
vested
$
Number
Value
Value
Number
lapsed /
disposed
$
Value
lapsed
$
David Dearie
Geoff Bainbridge
Warren Randall
Laurent Ly
25/11/2019
25/11/2019
25/11/2019
25/11/2019
31/12/2026
31/12/2026
31/12/2026
31/12/2026
1,180,000
1,060,000
300,000
300,000
949,917
853,316
241,504
241,504
-
-
-
-
-
-
-
-
-
-
-
-
* Number granted is post 30-for-1 share, options and rights consolidation completed during the year.
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and
other key management personnel in this financial year or future reporting years are as follows:
Grant date
25 November 2019
25 November 2019
25 November 2019
25 November 2019
25 November 2019
Vesting date and
exercisable date
31 December 2020
31 December 2021
31 December 2022
31 December 2023
31 December 2024
Expiry date
31 December 2026
31 December 2026
31 December 2026
31 December 2026
31 December 2026
Share price
hurdle for
vesting*
Fair value
per right
at grant date
$1.350
$1.650
$1.950
$2.250
$2.550
$0.03401
$0.03141
$0.02839
$0.02729
$0.02536
*
Share price for vesting noted is inclusive on the increase as a result of the 30-for-1 consolidation completed in April
2020.
Performance rights granted carry no dividend or voting rights.
Additional information
The earnings of the Group for the four years to 30 June 2020 are summarised below:
Sales revenue
Profit / (loss) after income tax
7,426,459
(1,272,296)
5,523,207
(4,327,069)
428,476
(3,388,235)
96,570
(2,637,474)
2020
$
2019
$
2018
$
2017
$
16
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
Additional disclosures relating to key management personnel
Shareholding
The number of shares in the company held during the financial year by each director and other members of key
management personnel of the Group, including their personally related parties, is set out below:
Ordinary shares
Mr David Dearie
Mr Geoff Bainbridge
Mr Warren Randall
Mr Laurent Ly*
Ms. Laura McBain*
Mr. Brendan Waights
Mr. Alex Aleksic
Balance at
the start of
the year
Received
as part of
remuneration
Additions*
Effect of share
consolidation**
Balance at
the end of
the year
-
11,656,667
71,678,850
-
-
-
-
83,335,517
-
-
-
2,680,478
-
-
- 142,451,219
-
-
-
-
-
- 145,142,697
11,000
-
(11,268,112)
(69,289,555)
(137,702,846)
-
-
-
(218,260,513)
-
3,069,033
2,389,295
4,748,373
11,000
-
-
10,217,701
*
**
Additions for Laurent Ly and Laura McBain represent shares held upon appointment as directors.
Represents change in holding of shares as a result of 30-for-1 consolidation completed during April 2020.
Performance rights holding
The number of performance rights over ordinary shares in the company held during the financial year by each director and
other members of key management personnel of the Group, including their personally related parties, is set out below:
Performance rights over ordinary shares
Mr David Dearie
Mr Geoff Bainbridge
Mr Warren Randall
Mr Laurent Ly
Ms. Laura McBain
Mr. Brendan Waights
Mr. Alex Aleksic
Balance at
the start of
the year
Granted
Vested
-
-
-
-
-
-
-
-
35,400,000
31,800,000
9,000,000
9,000,000
-
-
-
85,200,000
Effect of share
consolidation**
Balance at
the end of
the year
-
-
-
-
-
-
-
-
(34,220,000)
(30,740,000)
(8,700,000)
(8,700,000)
-
-
-
(82,360,000)
1,180,000
1,060,000
300,000
300,000
-
-
-
2,840,000
**
Represents change in holding of performance rights as a result of 30-for-1 consolidation completed during April 2020.
This concludes the remuneration report, which has been audited.
Shares under option
Unissued ordinary shares of Lark Distilling Co. Ltd under option at the date of this report are as follows:
Grant date
22 May 2018
22 May 2018
22 May 2018
22 October 2018
28 November 2017
Expiry date
30 May 2021
30 May 2021
30 May 2021
1 November 2020
31 July 2021
Exercise
price
Number
under option*
$0.900
$1.125
$1.350
$0.963
$2.250
138,046
138,046
138,046
103,842
102,776
620,756
*
Number of options noted are inclusive of the effect of the 30-for-1 consolidation completed in April 2020.
17
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
No person entitled to exercise the options had or has any right by virtue of the option to participate in any share issue of
the company or of any other body corporate.
Shares under performance rights
Grant date
16/03/2020
17/12/2019
Expiry date
31/12/2026
31/12/2026
Number*
680,000
2,840,000
3,520,000
* Number of performance rights are inclusive of the effect of the 30-for-1 consolidation completed in April 2020
No person entitled to exercise the performance rights had or has any right by virtue of the performance right to participate
in any share issue of the company or of any other body corporate.
Shares issued on the exercise of options
No options were exercised during the year ended 30 June 2020 and up to the date of this report.
Shares issued on the exercise of performance rights
No performance rights were exercised during the year ended 30 June 2020 and up to the date of this report.
Indemnity and insurance of officers
The company has indemnified the directors and executives of the company for costs incurred, in their capacity as a director
or executive, for which they may be held personally liable, except where there is a lack of good faith.
During the financial year, the company paid a premium in respect of a contract to insure the directors and executives of
the company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits
disclosure of the nature of the liability and the amount of the premium.
Indemnity and insurance of auditor
The company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the
company or any related entity against a liability incurred by the auditor.
During the financial year, the company has not paid a premium in respect of a contract to insure the auditor of the company
or any related entity.
Proceedings on behalf of the company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on
behalf of the company, or to intervene in any proceedings to which the company is a party for the purpose of taking
responsibility on behalf of the company for all or part of those proceedings.
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 33 to the financial statements.
The directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another
person or firm on the auditor's behalf), is compatible with the general standard of independence for auditors imposed by
the Corporations Act 2001.
18
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' report
30 June 2020
The directors are of the opinion that the services as disclosed in note 33 to the financial statements do not compromise
the external auditor's independence requirements of the Corporations Act 2001 for the following reasons:
●
all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity
of the auditor; and
none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code
of Ethics for Professional Accountants issued by the Accounting Professional and Ethical Standards Board, including
reviewing or auditing the auditor's own work, acting in a management or decision-making capacity for the company,
acting as advocate for the company or jointly sharing economic risks and rewards.
●
Officers of the company who are former partners of Deloitte Touche Tohmatsu
There are no officers of the company who are former partners of Deloitte Touche Tohmatsu.
Auditor's independence declaration
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out
immediately after this directors' report.
Auditor
Deloitte Touche Tohmatsu continues in office in accordance with section 327 of the Corporations Act 2001.
This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act
2001.
On behalf of the directors
___________________________
David Dearie
Chairman
25 September 2020
19
For personal use only
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Level 8, 22 Elizabeth Street
Hobart, TAS, 7000
Australia
Phone: +61 3 6237 7000
www.deloitte.com.au
Lark Distilling Co. Ltd
Level 1
30 Argyle Street
Hobart TAS 7000
25 September 2020
Dear Board Members
Lark Distilling Co. Ltd
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following
declaration of independence to the directors of Lark Distilling Co. Ltd.
As lead audit partner for the audit of the financial statements of Lark Distilling Co. Ltd for the financial
year ended 30 June 2020, I declare that to the best of my knowledge and belief, there have been no
contraventions of:
(i) the auditor independence requirements of the Corporations Act 2001 in relation to the
audit; and
(ii) any applicable code of professional conduct in relation to the audit.
Yours sincerely
DELOITTE TOUCHE TOHMATSU
Carl Harris
Partner
Chartered Accountant
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Asia Pacific Limited and the Deloitte Network
20
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Statement of profit or loss and other comprehensive income
For the year ended 30 June 2020
Revenue
Sales revenue
Cost of sales
Gross profit
Other income
Expenses
Selling and distribution expenses
Administration expenses
Employee benefits expense
Depreciation and amortisation expense
Impairment expenses
Loss before interest and tax expense
Finance income
Finance costs
Loss before income tax expense
Income tax expense
Consolidated
Note
2020
$
2019
$
5
9
6
9
7
8
10
9
11
12
13
7,426,459
(3,384,365)
5,523,207
(2,639,740)
4,042,094
2,883,467
748,803
30,681
(824,856)
(2,401,675)
(2,541,438)
(127,068)
-
(371,091)
(3,129,769)
(2,070,493)
(57,428)
(1,367,269)
(1,104,140)
(4,081,902)
19,117
(187,273)
116,908
(362,075)
(1,272,296)
(4,327,069)
-
-
Loss after income tax expense for the year attributable to the owners of Lark
Distilling Co. Ltd
9
(1,272,296)
(4,327,069)
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Foreign currency translation
Other comprehensive income for the year, net of tax
Total comprehensive income / (loss) for the year attributable to the owners
of Lark Distilling Co. Ltd
Basic earnings per share
Diluted earnings per share
447
447
-
-
(1,271,849)
(4,327,069)
Cents
Cents
40
40
(2.34)
(2.34)
(7.96)
(7.96)
The above statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes
21
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Statement of financial position
As at 30 June 2020
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Prepaid assets
Total current assets
Non-current assets
Trade and other receivables
Inventories
Financial assets
Property, plant and equipment
Right-of-use assets
Intangibles
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Financial liabilities
Employee benefits
Total current liabilities
Non-current liabilities
Trade and other payables
Borrowings
Financial liabilities
Employee benefits
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
Note
Consolidated
2020
$
2019
$
14
15
16
6,119,362
1,532,937
4,950,050
21,244
6,731,306
525,868
6,306,572
39,368
12,623,593 13,603,114
17
18
19
20
21
22
-
14,329,411
-
7,907,617
206,930
185,705
8,469,516
300,000
6,802,476
-
11,229,315 11,031,472
33,673,273 26,789,169
46,296,866 40,392,283
23
24
25
26
27
3,054,055
423,612
150,263
3,627,930
1,277,015
474,024
161,337
1,912,376
17,247
5,000,000
176,060
98,531
5,291,838
5,017
-
377,236
58,347
440,600
8,919,768
2,352,976
37,377,098 38,039,307
28
29
30
49,475,985 49,361,969
47,641
(12,642,599) (11,370,303)
543,712
37,377,098 38,039,307
The above statement of financial position should be read in conjunction with the accompanying notes
22
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Statement of changes in equity
For the year ended 30 June 2020
Consolidated
Issued
capital
$
Reserves
$
Accumulated
losses
$
Non-
controlling
interest
$
Total equity
$
Balance at 1 July 2018
37,964,572
47,813
(7,047,849)
4,615 30,969,151
Loss after income tax expense for the year
Other comprehensive income for the year, net
of tax
Total comprehensive income / (loss) for the
year
Transactions with owners in their capacity as
owners:
FX arising from translating
Non-controlling interest of Lark Distillery Pty
Ltd
Shares issued during the year
Shares issue cost
-
-
-
-
-
(4,327,069)
-
(4,327,069)
-
-
-
-
-
(4,327,069)
-
(4,327,069)
(172)
-
-
(172)
-
11,946,049
(548,652)
-
-
-
4,615
-
-
(4,615)
-
- 11,946,049
(548,652)
-
Balance at 30 June 2019
49,361,969
47,641
(11,370,303)
- 38,039,307
Consolidated
Balance at 1 July 2019
Loss after income tax expense for the year
Other comprehensive income for the year, net of tax
Total comprehensive income / (loss) for the year
Transactions with owners in their capacity as owners:
Contributions of equity, net of transaction costs (note 28)
Share-based payments (note 41)
Issued
capital
$
Reserves
$
Accumulated
losses
$
Total equity
$
49,361,969
47,641
(11,370,303) 38,039,307
-
-
-
447
447
-
(1,272,296)
(1,272,296)
447
-
(1,272,296)
(1,271,849)
114,016
-
-
495,624
-
-
114,016
495,624
Balance at 30 June 2020
49,475,985
543,712
(12,642,599) 37,377,098
The above statement of changes in equity should be read in conjunction with the accompanying notes
23
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Statement of cash flows
For the year ended 30 June 2020
Cash flows from operating activities
Receipts from customers (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Purchase of inventory
Interest paid
Interest received
Consolidated
Note
2020
$
2019
$
8,348,262
(3,858,586)
(7,887,738)
(163,315)
33,385
6,709,266
(5,206,874)
(5,797,616)
(362,075)
116,908
Net cash used in operating activities
39
(3,527,992)
(4,540,391)
Cash flows from investing activities
Payments for property, plant and equipment
Payments for intangibles
Proceeds from sale of property, plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Proceeds from borrowings
Repayment of borrowings
Payment of lease liabilities under AASB 16
Share issue transaction costs
Net cash from financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
(1,330,644)
(244,996)
6,000
(656,470)
(52,007)
-
(1,569,640)
(708,477)
-
5,000,000
(490,354)
(23,958)
-
11,946,049
262,301
(6,401,333)
-
(687,662)
4,485,688
5,119,355
(611,944)
6,731,306
(129,513)
6,860,819
Cash and cash equivalents at the end of the financial year
14
6,119,362
6,731,306
The above statement of cash flows should be read in conjunction with the accompanying notes
24
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 1. General information
The financial statements cover Lark Distilling Co. Ltd (previously Australian Whisky Holdings Limited) as a Group
consisting of Lark Distilling Co. Ltd and the entities it controlled at the end of, or during, the year. The financial statements
are presented in Australian dollars, which is Lark Distilling Co. Ltd's functional and presentation currency.
Lark Distilling Co. Ltd is a listed public company limited by shares (ASX code: LRK), incorporated and domiciled in
Australia. Its registered office and principal place of business are:
Registered office
Level 1
30 Argyle Street
Hobart TAS 7000
Principal place of business
Level 1
30 Argyle Street
Hobart TAS 7000
A description of the nature of the Group's operations and its principal activities are included in the directors' report, which
is not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution of directors, on 25 September
2020. The directors have the power to amend and reissue the financial statements.
Note 2. Significant accounting policies
Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and
Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as
appropriate for for-profit oriented entities. These financial statements also comply with International Financial Reporting
Standards as issued by the International Accounting Standards Board ('IASB').
The financial statements cover Lark Distilling Co. Limited (“Company”) and its controlled entities as a consolidated entity
(“Group”). Lark Distilling Co. Limited is a company limited by shares, incorporated and domiciled in Australia. Compliance
with Australian Accounting Standards ensures that the financial statements and notes of Australian Whisky Holdings
Limited and its controlled entities comply with International Financial Reporting Standards (IFRS). Australian Whisky
Holdings Limited is a for profit entity for the purpose of preparing the financial statements.
Historical cost convention
The financial statements have been prepared under the historical cost convention, except for, where applicable, the
revaluation of financial assets and liabilities at fair value through profit or loss, financial assets at fair value through other
comprehensive income, certain classes of property, plant and equipment and derivative financial instruments.
Critical accounting estimates
The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of applying the Group's accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial
statements, are disclosed in note 3.
New or amended Accounting Standards and Interpretations adopted
The group has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian
Accounting Standards Board ('AASB') that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
The adoption of these Accounting Standards and Interpretations did not have any significant impact on the financial
performance or position of the Group.
25
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
The following Accounting Standards and Interpretations are most relevant to the Group:
AASB 16 Leases
The Group has adopted and complied with AASB 16 from 1 July 2019. This standard sets out the principles for the
recognition, measurement, presentation and disclosure of leases. The objective is to ensure that lessees and lessors
provide relevant information in a manner that faithfully represents those transactions. This information gives a basis for
users of financial statements to assess the effect that leases have on the financial position, financial performance and
cash flows of an entity.
On adoption of AASB 16 from 1 July 2019, the Group is not required to make any financial statement adjustment on
application of this standard. The Group did not have any off-balance sheet leases in the prior period to bring on-balance
sheet.
The Group has leases that relate to raw materials inventory and production equipment which have been recognised
according to the nature of the assets at the time of lease commencement with the corresponding lease obligation
recognised.
On recognition of the lease liabilities in the relative prior periods, the asset has been identified and disclosed in relation to
its’ nature and characteristic.
Part of the current financial liabilities balance at year end relate to the leasing of production equipment; these assets have
been recognised as Plant & Equipment and depreciated accordingly, pursuant to AASB 116. All other leases as at period
end relate to the leasing of wooden casks and have been recognised on lease recognition in accordance with AASB 102.
These costs are held in raw materials inventory (where the cask is not yet filled with spirit), or whisky in casks inventory
(utilising the raw materials inventory per the qualifying assets absorption costing of inventories), or, expensed through
COGS where that cask filled with spirit has been decanted and sold. All inventories are carried at cost and not depreciated.
The Group has entered into building and property lease transactions during the year end period ended 30 June 2020,
material leases are as detailed in right-of-use note 21.
Going concern
This financial report has been prepared on the going concern basis, which assumes continuity of normal business activities
and the realisation of assets and the settlement of liabilities in the ordinary course of business. The entity is involved in
significant expansionary activity and as such, is currently cash absorbing. During the period the entity incurred a loss of
$1,272,296 (FY19: $4,327,069) and had net cash outflows from operating activities of $3,527,992 (FY19: $4,540,391). As
at 30 June 2020 the entity had cash and cash equivalents of $6,119,362 (FY19: $6,731,306).
On 18 September 2020, Lark Distilling Co. successfully raised A$8.85 million via an institutional placement of shares. The
directors have approved a cash flow forecast which includes further expansionary activities in the production of new-make
spirit for the FY2021 year which will absorb cash throughout FY2021 and beyond. Due to having no current contracted or
legal obligations to increase production or undertake expansionary capital expenditure, the entity has the ability to
undertake mitigating actions in response to any cash flow uncertainties or potential risks that may arise after the date of
this report. Such actions include ceasing or reducing the level of expansionary whisky production, and the deferral or
suspension of non-critical capital expenditure.
At the date of this report and having considered the current cash balance, cash flow forecasts and mitigating plans, the
directors are confident that the Group will be able to continue as a going concern.
26
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
Financial Instruments
Financial Assets
Recognition and Initial Measurement
Financial assets and financial liabilities are recognised in the Group’s statement of financial position when the Group
becomes a party to the contractual provisions of the instrument.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable
to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at
fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities,
as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial
liabilities at fair value through profit or loss are recognised immediately in profit or loss.
All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis. Regular
way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame
established by regulation or convention in the marketplace. All recognised financial assets are measured subsequently in
their entirety at either amortised cost or fair value, depending on the classification of the financial assets.
Classification of financial assets
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an
active market and are subsequently measured at amortised cost using the effective interest rate method.
Non-current investments are measured on the cost basis to the extent they represent investments in wholly owned
subsidiaries which are consolidated in accordance with note 2. The carrying amount of non-current investments is
reviewed annually by directors to ensure it is not in excess of the recoverable amount of these investments.
Impairment of financial assets
The Group recognises lifetime expected credit losses for trade receivables. The expected credit losses on these financial
assets are estimated using a provision matrix based on the Group’s historical credit loss experience, adjusted for factors
that are specific to the debtors, general economic conditions and an assessment of both the current as well as the forecast
direction of conditions at the reporting date, including time value of money where appropriate.
For all other financial instruments, the Group recognises lifetime expected credit losses (“ECL”) when there has been a
significant increase in credit risk since initial recognition. However, if the credit risk on the financial instrument has not
increased significantly since initial recognition, the Group measures the loss allowance for that financial instrument at an
amount equal to 12-month ECL.
Derecognition
Financial assets are derecognised where the contractual rights to receipt of cash flows expires or the asset is transferred
to another party whereby the entity no longer has any significant continuing involvement in the risks and benefits
associated with the asset.
27
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
Financial Liabilities
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost using the
effective interest rate method.
Financial liabilities that are not
(i) contingent consideration of an acquirer in a business combination,
(ii) held-for-trading, or
(iii) designated as at fair value through profit or loss (“FVTPL”), are measured subsequently at amortised cost using the
effective interest method. The effective interest method is a method of calculating the amortised cost of a financial liability
and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts
estimated future cash payments (including all fees and points paid or received that form an integral part of the effective
interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or
(where appropriate) a shorter period, to the amortised cost of a financial liability.
Derecognition
Financial liabilities are derecognised where the related obligations are either discharged, cancelled or expire. The
difference between the carrying value of the financial liability extinguished or transferred to another party and the fair value
of consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognized in profit or loss.
Impairment of assets
At each reporting date, the group reviews the carrying values of its tangible and intangible assets to determine whether
there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the
asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the asset’s carrying
value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the statement of profit or loss
and other comprehensive income.
Impairment testing is performed annually for goodwill and intangible assets with indefinite lives. Where it is not possible to
estimate the recoverable amount of an individual asset, the group estimates the recoverable amount of the cash-
generating unit to which the asset belongs.
An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only to the
extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of
depreciation or amortisation, if no impairment loss had been recognised.
Principles of consolidation
A controlled entity is any entity that the Company has the power to control the financial and operating policies of the entity
so as to obtain benefits from its activities. In assessing the power to govern, the existence and effect of holdings of actual
and potential voting rights are considered.
A list of controlled entities is contained in note 37 to the consolidated financial statements. All controlled entities have a
June financial year-end, except for Aowei Liquor Industries Beijing Limited (former name Beijing Montec Commercial
Limited), which has a December year end; and Australian Whisky Holdings (HK) Limited (former name Montec
International (HK) Limited), which has a March year end.
As at reporting date, the assets and liabilities of all controlled entities have been incorporated into the consolidated financial
statements as well as their results for the year then ended. Where controlled entities have entered the consolidated group
during the year, their operating results have been included from the date control was obtained.
All inter-company balances and transactions between entities in the Group, including any unrealised profits or losses,
have been eliminated on consolidation. Accounting policies of subsidiaries have been changed to ensure consistencies
with those policies applied by the parent entity.
Foreign currency translation
The financial statements are presented in Australian dollars, which is Lark Distilling Co. Ltd's functional and presentation
currency.
28
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
Foreign currency transactions
Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the
translation at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are
recognised in profit or loss.
Exchange differences arising on the translation of monetary items are recognised in the statement of Profit or Loss and
other Comprehensive Income.
Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that
the gain or loss is directly recognised in equity, otherwise the exchange difference is recognised in the statement of Profit
or Loss and other Comprehensive Income. Group companies
The financial results and position of foreign operations whose functional currency is different from the group’s presentation
currency are translated as follows:
●
●
●
assets and liabilities are translated at year-end exchange rates prevailing at that reporting date;
income and expenses are translated at average exchange rates for the period, where this approximates the rate at
date of transaction; and
retained earnings are translated at the exchange rates prevailing at the date of the transaction.
Exchange differences arising on translation of foreign operations are transferred directly to the group’s foreign currency
translation reserve in the statement of Financial Position. These differences are recognised in the statement of Profit or
Loss and other Comprehensive Income in the period in which the operation is disposed.
Other revenue is recognised when it is received or when the right to receive payment is established.
Income tax
The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable
income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to temporary
differences, unused tax losses and the adjustment recognised for prior periods, where applicable.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when
the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted,
except for:
● When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in
a transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting
nor taxable profits; or
● When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and
the timing of the reversal can be controlled, and it is probable that the temporary difference will not reverse in the
foreseeable future.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred
tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for
the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is
probable that there are future taxable profits available to recover the asset.
Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets
against current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable
authority on either the same taxable entity or different taxable entities which intend to settle simultaneously.
29
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
Lark Distilling Co. Ltd (the 'head entity') and its wholly-owned Australian subsidiaries have formed an income tax
consolidated group under the tax consolidation regime. The head entity and each subsidiary in the tax consolidated group
continue to account for their own current and deferred tax amounts. The tax consolidated group has applied the 'separate
taxpayer within group' approach in determining the appropriate amount of taxes to allocate to members of the tax
consolidated group.
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Group's
normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after
the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a
liability for at least 12 months after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the Group's normal operating cycle; it is held
primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no
unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities
are classified as non-current.
Goods and Services Tax ('GST') and other similar taxes
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not
recoverable from the tax authority. In this case it is recognised as part of the cost of the 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 net amount of GST
recoverable from, or payable to, the tax authority is included in other receivables or other payables in the statement of
financial position.
Note 3. Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates and assumptions that
affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates
in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates
and assumptions on historical experience and on other various factors, including expectations of future events,
management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will
seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing
a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial
year are discussed below.
Coronavirus (COVID-19) pandemic
Judgement has been exercised in considering the impacts that the Coronavirus (COVID-19) pandemic has had, or may
have, on the Group 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 Group operates. Other than as addressed
in specific notes, 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 Group unfavourably as at the reporting
date or subsequently as a result of the Coronavirus (COVID-19) pandemic.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by using either the Binomial or Black-
Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting
estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying
amounts of assets and liabilities within the next annual reporting period but may impact profit or loss and equity.
30
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 3. Critical accounting judgements, estimates and assumptions (continued)
Goodwill and other indefinite life intangible assets
The Group tests annually, or more frequently if events or changes in circumstances indicate impairment, whether goodwill
and other indefinite life intangible assets have suffered any impairment, in accordance with the accounting policy stated
in note 2. The recoverable amounts of cash-generating units have been determined based on value-in-use calculations.
These calculations require the use of assumptions, including:
-
-
-
the forecasting of future cash flows (driven by litres available for sale and price achieved per litre)
the discount rates applicable to the future cash flows and
expected growth rates
Note 4. Operating segments
Identification of reportable operating segments
The Group is organised into three operating segments: whisky, gin, and other. These operating segments are based on
the internal reports that are reviewed and used by the Board of Directors (who are identified as the Chief Operating
Decision Makers ('CODM')) in assessing performance and in determining the allocation of resources.
The operations of the Group in management of equity investments is consistent with the Groups’ strategy to continue its
investment and growth in both whisky (“Lark” as the hero brand) and gin (“Forty Spotted Gin”). Whisky and gin are
assessed as separate segments by the CODM due to the differences in production processes, inventory life cycle, market
categories, working capital requirements and financial contribution to the Group. The “other” segment is representative of
function’s that attribute to Group results but are not directly attributable to whisky or gin segments, and include hand
sanitiser sales. Operating segments are therefore split into the three segments; Lark, Gin and other.
The CODM reviews EBITDA (earnings before interest, tax, depreciation and amortisation). The accounting policies
adopted for internal reporting to the CODM are consistent with those adopted in the financial statements.
The information reported to the CODM is on a monthly basis.
Intersegment receivables, payables and loans
Intersegment loans are initially recognised at the consideration received. Intersegment loans receivable and loans payable
that earn or incur non-market interest are not adjusted to fair value based on market interest rates. Intersegment loans
are eliminated on consolidation.
Major customers
During the year ended 30 June 2020, approximately 19% of the Group's external revenue was derived from sales to Proof
& Company (“Distributor” of Lark whisky, Overeem whisky and Forty Spotted gin).
Operating segment information
Consolidated - 2020
Revenue
Sales to external customers
Other income
Total revenue
EBITDA
Depreciation and amortisation
Finance costs and income
Loss before income tax expense
Income tax expense
Loss after income tax expense
Whisky
$
Gin
$
Other
$
Total
$
4,889,830
748,803
5,638,633
1,360,944
-
1,360,944
1,175,685
-
1,175,685
7,426,459
748,803
8,175,262
(29,364)
(82,594)
(165,259)
(277,217)
(685,711)
(25,414)
(1,656)
(712,781)
(261,996)
(19,060)
(1,242)
(282,298)
(977,071)
(127,068)
(168,157)
(1,272,296)
-
(1,272,296)
31
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 4. Operating segments (continued)
Whisky
$
Gin
$
Other
$
Total
$
3,219,020
30,681
3,249,702
1,439,086
-
1,439,086
865,101
-
865,101
5,523,207
30,681
5,553,888
(3,303,788)
(37,397)
(245,167)
(3,586,352)
(489,998)
(11,507)
-
(501,505)
(230,687)
(8,525)
-
(239,212)
(4,024,473)
(57,428)
(245,167)
(4,327,069)
-
(4,327,069)
Consolidated
2020
$
2019
$
4,889,832
1,360,944
1,175,683
3,219,020
1,439,085
865,102
7,426,459
5,523,207
Consolidated - 2019
Revenue
Sales to external customers
Other income
Total revenue
EBITDA
Depreciation and amortisation
Finance costs and income
Loss before income tax expense
Income tax expense
Loss after income tax expense
Note 5. Revenue
Operating activity
Whisky revenue
Gin revenue
Other
Revenue recognition
The Group recognises revenue as follows:
Revenue from contracts with customers
Revenue is recognised at an amount that reflects the consideration to which the Group is expected to be entitled in
exchange for transferring goods or services to a customer. For each contract with a customer, the Group: identifies the
contract with a customer; identifies the performance obligations in the contract; determines the transaction price which
takes into account estimates of variable consideration and the time value of money; allocates the transaction price to the
separate performance obligations on the basis of the relative stand-alone selling price of each distinct good or service to
be delivered; and recognises revenue when or as each performance obligation is satisfied in a manner that depicts the
transfer to the customer of the goods or services promised.
Variable consideration within the transaction price, if any, reflects concessions provided to the customer such as discounts,
rebates and returns, any potential bonuses receivable from the customer and any other contingent events. Such estimates
are determined and consistently applied using either the 'expected value' or 'most likely amount' method. The
measurement of variable consideration is subject to a constraining principle whereby revenue will only be recognised to
the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognised will not
occur. The measurement constraint continues until the uncertainty associated with the variable consideration is
subsequently resolved. Amounts received that are subject to the constraining principle are recognised as a refund liability.
32
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 5. Revenue (continued)
Sale of goods
Revenue derived from the sale of inventories to customers is recognised at the time of delivery.
Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial
assets.
All revenue is stated gross of any applicable excise duties, discounts or rebates, and net of the amount of goods and
services tax (GST).
Interest
Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest
rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset
to the net carrying amount of the financial asset.
Other revenue
Other revenue is primarily hand sanitiser for the current year, as well as brandy and other alcohol sold, and is recognised
when it is received or when the right to receive payment is established.
Note 6. Other income
R&D grant income
Government grant income
Excise rebate income
Gain on sale of Overeem brand
Other income
Consolidated
2020
$
2019
$
30,185
336,457
100,000
165,000
117,161
30,681
-
-
-
-
748,803
30,681
Government grant income
Government grant incentive relates to Job Keeper government incentive payments in response to COVID-19.
Gain on sale of Overeem brand
On 19 February 2020 the Group executed a binding Heads of Agreement with Sawford Distillery Pty Limited for the sale
of the Overeem Single Malt Whisky trademark and limited whisky inventory.
33
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 7. Administration expenses
Director fees
Consulting fees
General and administration
Insurance
IT and communications
Transport, travel and entertainment
Occupancy
Total administration expenses
Note 8. Employee benefit expense
Salaries and wages
Superannuation
Employee provision movement
Share based payments expense
Other employee expenses
Note 9. Loss before income tax expense
Loss before income tax determined after
Impairment expense - Group assets*
Cost of goods sold
Directors fees
Consulting fees
Selling and marketing expenses
Legal fees
Occupancy costs
Transport, travel and entertainment
*Impairment of group assets relates to:
Goodwill (note 22)
Land and Buildings (note 20)
34
Consolidated
2020
$
2019
$
542,997
499,728
863,993
112,967
48,476
98,840
234,674
223,425
696,283
1,485,269
132,792
36,357
318,160
237,483
2,401,675
3,129,769
Consolidated
2020
$
2019
$
1,784,508
158,345
51,965
495,624
50,996
1,718,168
159,912
78,448
-
113,965
2,541,438
2,070,493
Consolidated
2020
2019
-
(3,384,363)
(542,997)
(499,728)
(824,857)
(336,307)
(234,674)
(98,840)
(1,367,269)
(1,714,946)
(223,425)
(696,283)
(371,091)
(593,761)
(237,483)
(318,160)
(5,921,766)
(5,522,418)
Consolidated
2020
2019
-
-
(837,586)
(529,683)
-
(1,367,269)
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 10. Depreciation and amortisation
Depreciation on property, plant and equipment
Amortisation of intangibles
Depreciation on right-of-use assets
Total depreciation and amortisation expense
Depreciation capitalised into inventory
Note 11. Finance income
Interest income
Note 12. Finance costs
Interest expense
Bank and other fees
Note 13. Income tax expense
Numerical reconciliation of income tax expense and tax at the statutory rate
Loss before income tax expense
Tax at the statutory tax rate of 27.5%
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Asset impairment
Legal fees
Share-based payments
R&D offset income
Tax losses not recognised
Income tax expense
35
Consolidated
2020
2019
(48,097)
(47,135)
(31,836)
(23,282)
(34,146)
-
(127,068)
(57,428)
(171,406)
(162,818)
Consolidated
2020
2019
19,117
116,908
Consolidated
2020
$
2019
$
(147,672)
(39,601)
(318,101)
(43,974)
(187,273)
(362,075)
Consolidated
2020
$
2019
$
(1,272,296)
(4,327,069)
(349,881)
(1,189,944)
-
-
148,687
(8,300)
375,999
163,285
-
-
(209,494)
209,494
(650,660)
650,660
-
-
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 13. Income tax expense (continued)
Tax losses not recognised
Unused tax losses for which no deferred tax asset has been recognised
Potential tax benefit @ 27.5%
Consolidated
2020
$
2019
$
27,280,068 23,527,985
7,502,019
6,470,196
The above potential tax benefit for tax losses has not been recognised in the statement of financial position. These tax
losses can only be utilised in the future if the continuity of ownership test is passed, or failing that, the same business test
is passed, and future taxable profits are available to offset against the carry forward tax losses.
Note 14. Current assets - cash and cash equivalents
Cash on hand
Cash at bank
Cash on deposit
Consolidated
2020
$
2019
$
3,767
6,115,595
-
4,253
668,520
6,058,533
6,119,362
6,731,306
Accounting policy for cash and cash equivalents
For the purpose of the statement of cash flows, cash and cash equivalents includes cash on hand and at call deposits
with banks or financial institutions, net of bank overdrafts.
Note 15. Current assets - trade and other receivables
Trade receivables
Other receivables
Expected credit losses
Deposits paid
Consolidated
2020
$
2019
$
1,228,265
279,376
(20,828)
46,124
397,017
89,832
(5,442)
44,461
1,532,937
525,868
Accounting policy for trade and other receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective
interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within
30 days.
36
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 16. Current assets - inventories
Raw materials - at cost
Work in progress - at cost
Finished goods - at cost
Inventory in casks – at cost
Consolidated
2020
$
2019
$
1,486,300
784,961
346,094
2,332,695
1,831,490
-
518,562
3,956,520
4,950,050
6,306,572
Accounting policy for inventories
Raw materials, work in progress and finished goods are stated at the lower of cost and net realisable value on a 'first in
first out' basis. Cost comprises of direct materials and delivery costs, direct labour, import duties and other taxes, an
appropriate proportion of variable and fixed overhead expenditure based on normal operating capacity, and, where
applicable, transfers from cash flow hedging reserves in equity. Costs of purchased inventory are determined after
deducting rebates and discounts received or receivable. Work in progress inventory reflects whisky, gin and hand-sanitiser
currently in production but not yet bottled or barrelled.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion
and the estimated costs necessary to make the sale.
Note 17. Non-current assets - trade and other receivables
Deposit paid
Other receivables
Note 18. Non-current assets - inventories
Consolidated
2020
$
2019
$
-
-
-
184,621
1,084
185,705
Consolidated
2020
$
2019
$
Inventory in casks – at cost
14,329,411
8,469,516
Non-current inventory represents whisky in casks that is expected to be maturing for at least a further 12 months. The
company does not expect these casks to be decanted or sold within the next 12 months.
Note 19. Non-current assets - financial assets
Investment in Old Kempton - at fair value
Consolidated
2020
$
2019
$
-
300,000
On 8 April 2020, the group executed a Buy-Back Agreement with Old Kempton Distillery (OKD) whereby OKD bought
back Lark Distilling Co.’s 12% share of OKD (acquired in 2016 for $300,000) in return for $300k of the current whisky
inventory of OKD.
37
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 20. Non-current assets - property, plant and equipment (continued)
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Land and
Buildings
Building
Improvements
Plant, Equipment
& Production
Assets
Motor Vehicles
Capital WIP
Total
Cost at 1 July 2018
6,814,403
2,528,591
4,205,502
96,866
- 13,645,362
Accum ulated Depreciation to 1 July 2018
-
-
(697,199)
(14,528)
-
(711,727)
Carrying Value at 1 July 2018
6,814,403
2,528,591
3,508,303
82,338
12,933,635
Cost 1 July 2018
Transfers betw een PPE classes
Additions
Provisional accounting adjustments - Land and buildings (i)
Provisional accounting adjustments - Inventory (ii)
Provisional accounting adjustments - Intangibles (ii)
Provisional accounting adjustments - cost of sales (ii)
Provisional accounting adjustments - Goodw ill (ii)
Disposals
Cost at 30 June 2019
6,814,403
924,101
647,669
(1,321,529)
(600,477)
-
(30,321)
(1,869,202)
2,528,591
(2,425,937)
-
-
-
-
-
-
4,205,502
1,501,836
-
-
(957,979)
(6,000)
(399)
(1,468,385)
96,866
-
-
-
-
-
-
-
4,564,644
102,654
3,274,575
96,866
- 13,645,362
-
-
647,669
-
(1,321,529)
-
(1,558,456)
-
(6,000)
-
(30,720)
-
(3,337,587)
-
-
8,038,739
-
-
-
-
-
-
-
-
-
(711,727)
191,247
(186,100)
(529,683)
-
(1,236,263)
6,802,476
8,038,739
-
1,470,197
(26,644)
(118,909)
Accum ulated depreciation at 30 June 2018
Provisional accounting adjustments - Inventory (ii)
Depreciation expense
Impairment expense
Disposals
Accum ulated Depreciation and Im pairm ent to 30 June 2019
-
-
-
(529,683)
-
(529,683)
-
-
(2,615)
-
-
(2,615)
(697,199)
191,247
(183,485)
-
-
(689,437)
(14,528)
-
-
-
-
(14,528)
(i) Represents fair value adjustment made during the final purchase price allocation exercised performed on acquisition of Lark Distillery Pty Ltd.
(ii) Represents adjustments made during the final purchase price allocation exercised performed on acquisition of the Nant Entities
Carrying Value at 30 June 2019
4,034,961
100,039
2,585,138
4,564,644
102,654
3,274,575
82,338
96,866
Cost 30 June 2019
Additions
Disposals
Transfer to intangibles
Cost 30 June 2020
-
-
-
64,231
-
-
560,716
(26,644)
(118,909)
-
-
-
845,250
-
-
4,564,644
166,885
3,808,647
96,866
845,250
9,363,383
Accum ulated Depreciation and Im pairm ent at 30 June 2019
(529,683)
(2,615)
(689,437)
(14,528)
-
(1,236,263)
Depreciation expense (through profit or loss)
Depreciation expense (capitalised to inventory)
Impairment expense
Disposals
-
-
-
-
(8,806)
-
-
-
(28,088)
(171,406)
-
-
(11,203)
-
-
-
-
-
-
-
(48,097)
(171,406)
-
-
Accum ulated Depreciation and Im pairm ent to 30 June 2020
(529,683)
(11,421)
(888,931)
(25,731)
-
(1,455,766)
Carrying Value at 30 June 2020
4,034,961
155,464
2,919,716
71,135
845,250
7,907,617
Accounting policy for property, plant and equipment
Items of property, plant and equipment are measured at cost, less accumulated depreciation and any accumulated
impairment losses.
If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for as
separate items (major components) of property, plant and equipment.
38
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 20. Non-current assets - property, plant and equipment (continued)
Freehold land is not depreciated.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses
are recognised in profit and loss.
The depreciable amount of all fixed assets is depreciated on a straight line basis over their useful lives to the consolidated
group commencing from the time the asset is held ready for use.
The depreciation rates used for each class of depreciable assets are:
Freehold improvements
Office and computer equipment
Plant, machinery & production assets
Motor vehicles
2.5%
25% - 33%
5% - 33%
10% - 20%
The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.
An asset's carrying amount is written down immediately to its recoverable amount if the assets carrying amount is greater
than its estimated recoverable amount.
Note 21. Non-current assets - right-of-use assets
Land and buildings - right-of-use
Less: Accumulated depreciation
Consolidated
2020
$
2019
$
238,766
(31,836)
206,930
-
-
-
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Consolidated
Balance at 1 July 2018
Balance at 30 June 2019
Additions
Depreciation expense
Balance at 30 June 2020
Land and
building right-
of-use
$
Total
$
-
-
-
238,766
(31,836)
-
238,766
(31,836)
206,930
206,930
Accounting policy for right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which
comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the
commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in
the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset,
and restoring the site or asset.
39
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 21. Non-current assets - right-of-use assets (continued)
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful
life of the asset, whichever is the shorter. Where the Group expects to obtain ownership of the leased asset at the end of
the lease term, the depreciation is over its estimated useful life. Right-of use assets are subject to impairment or adjusted
for any remeasurement of lease liabilities.
The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with
terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss
as incurred.
Note 22. Non-current assets - intangibles
Goodwill - at cost
Intangible assets - at cost
Less: Accumulated amortisation
Consolidated
2020
$
2019
$
10,934,839 10,934,839
461,752
(167,276)
294,476
216,773
(120,140)
96,633
11,229,315 11,031,472
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Consolidated
Balance at 1 July 2018
Additions
Fair value adjustment made during the final purchase price allocation
exercised performed on acquisition of Lark Distillery Pty Ltd.
Transfer from property, plant and equipment
Impairment
Transfers in/(out)
Amortisation expense
Balance at 30 June 2019
Additions
Capitalisation of costs
Amortisation expense
Balance at 30 June 2020
Goodwill
$
Other
intangibles
$
Total
$
7,150,379
4,267
22,367
61,075
7,172,746
65,342
1,321,529
3,337,587
(837,586)
(41,337)
-
-
6,000
-
41,337
(34,146)
1,321,529
3,343,587
(837,586)
-
(34,146)
10,934,839
-
-
-
96,633
126,069
118,909
(47,135)
11,031,472
126,069
118,909
(47,135)
10,934,839
294,476
11,229,315
40
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 22. Non-current assets - intangibles (continued)
Accounting policy for intangible assets
Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value
at the date of the acquisition. Intangible assets acquired separately are initially recognised at cost. Indefinite life intangible
assets are not amortised and are subsequently measured at cost less any impairment. Finite life intangible assets are
subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit or loss
arising from the derecognition of intangible assets are measured as the difference between net disposal proceeds and the
carrying amount of the intangible asset. The method and useful lives of finite life intangible assets are reviewed annually.
Changes in the expected pattern of consumption or useful life are accounted for prospectively by changing the amortisation
method or period.
Goodwill
Goodwill is carried at cost less any accumulated impairment losses.
Goodwill is calculated as the excess of the sum of:
(i) the consideration transferred;
(ii) any non-controlling interest (determined under either the full goodwill or proportionate interest method); and
(iii) the acquisition date fair value of any previously held equity interest;
over the acquisition date fair value of any identifiable assets acquired and liabilities assumed.
Changes in the Group's ownership interests in subsidiaries that do not result in the Group losing control over the
subsidiaries are accounted for as equity transactions. The carrying amounts of the Group's interests and the non-
controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between
the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is
recognised directly in equity and attributed to owners of the Company.
The amount of goodwill recognised on acquisition of each subsidiary in which the Group holds less than 100% interest will
depend on the method adopted in measuring the non-controlling interest. The Group can elect in most circumstances to
measure the non-controlling interest in the acquiree either at fair value (full goodwill method) or at the non-controlling
interest’s proportionate share of the subsidiary’s identifiable net assets (proportionate interest method). In such
circumstances, the Group determines which method to adopt for each acquisition and this is stated in the respective note
to the financial statements disclosing the business combination.
Under the full goodwill method, the fair value of the non-controlling interest is determined using valuation techniques which
make the maximum use of market information where available.
Goodwill on acquisition of subsidiaries is included in intangible assets. Goodwill on acquisition of associates is included in
investments.
Goodwill is tested for impairment annually and is allocated to the Group’s cash-generating units or groups of cash-
generating units, representing the lowest level at which goodwill is monitored and not larger than an operating segment.
Gains and losses on the disposal of an entity include the carrying amount of goodwill related to the entity disposed of.
Changes in the ownership interests in a subsidiary that do not result in a loss of control are accounted for as equity
transactions and do not affect the carrying amounts of goodwill.
Other intangible assets
Other intangible assets including patents and trademarks , that are acquired by the Group and have finite useful lives are
measured at cost less accumulated amortisation and any accumulated impairment losses.
41
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 22. Non-current assets - intangibles (continued)
Subsequent expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset
to which it relates. All other expenditure, including expenditure on internally generated goodwill and brands, is recognised
in profit or loss as incurred.
Amortisation
Amortisation is calculated to write off the cost of intangible assets less their estimated residual values using the straight-
line method over their estimated useful lives, and is generally recognised in profit or loss. Goodwill is not amortised. The
estimated useful lives for current and comparative periods are as follows:
Intangible asset
Intangible assets
Useful life
5-8 years
Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.
Note 23. Current liabilities - trade and other payables
Trade payables
Sundry creditors and accrued expenses
Other payables
Refer to note 31 for further information on financial instruments.
Note 24. Current liabilities - Financial liabilities
Barrel Finance and Logistics
Motor vehicles lease
Eclipx
Lease liability
Accounting policy for financial liabilities
Consolidated
2020
$
2019
$
1,010,227
1,377,569
666,259
482,201
484,312
310,502
3,054,055
1,277,015
Consolidated
2020
$
2019
$
329,570
47,016
-
47,026
366,634
18,336
89,054
-
423,612
474,024
Assets held under finance leases are recognised as assets of the Group at their fair value or, if lower, at the present value
of the minimum lease payments, each determined at the inception of the lease. The corresponding liability to the lessor is
included in the statement of financial position as a finance lease obligation.
42
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 25. Current liabilities - employee benefits
Employee benefits
Accounting policy for employee benefits
Consolidated
2020
$
2019
$
150,263
161,337
Short-term employee benefits
Provision is made for the consolidated group’s liability for employee benefits arising from services rendered by employees
to balance date. Employee benefits expected to be settled within one year, have been measured at the amounts expected
to be paid when the liability is settled plus related on-costs. Other employee benefits payable later than one year have
been measured at the present value of the estimated future cash outflows to be made for those benefits. Those cashflows
are discounted using market yields on national government bonds with terms to maturity that match the expected timing
of cashflows.
Contributions are made by the consolidated group to employee superannuation funds and are charged as expenses when
incurred.
Note 26. Non-current liabilities - Borrowings
Loan - Quality Life Pty Ltd
Refer to note 31 for further information on financial instruments.
The key terms of the loan are as follows:
- Facility amount up to AUD $5,000,000 (fully drawn as at 30 June 2020;
- Term is 5 years after initial drawdown (initial drawdown in March 2020);
- Interest rate of 4% per annum plus the RBA published cash rate paid quarterly;
- Interest only loan with principal due at the end of the term.
Total secured liabilities
The total secured liabilities (current and non-current) are as follows:
Loan - Quality Life Pty Ltd
Consolidated
2020
$
2019
$
5,000,000
-
Consolidated
2020
$
2019
$
5,000,000
-
Assets pledged as security
The loan is secured by a registered security interest in real property and whisky held by the Group.
43
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 27. Non-current liabilities - financial liabilities
Barrel Finance and Logistics
Motor vehicles
Lease liability
Note 28. Equity - issued capital
Consolidated
2020
$
2019
$
-
-
176,060
329,573
47,663
-
176,060
377,236
Consolidated
2020
Shares
2019
Shares
2020
$
2019
$
Ordinary shares - fully paid
54,453,167 1,630,579,441 49,475,985 49,361,969
Movements in ordinary share capital
Details
Date
Shares
Issue price
$
Balance
Issue of fully paid ordinary shares
Issue of fully paid ordinary shares
Share issue costs
1 July 2018
12 November 2018
26 November 2018
Balance
Issue of shares to settle liabilities
Issue of shares to settle liabilities
Consolidation of shares on 30 for 1 basis
30 June 2019
16 March 2020
16 March 2020
28 April 2020
1,339,212,384
242,586,570
48,780,487
-
1,630,579,441
2,297,436
718,121
(1,579,141,831)
Balance
30 June 2020
54,453,167
$0.041
$0.041
-
$0.039
$0.034
-
37,964,572
9,946,049
2,000,000
(548,652)
49,361,969
89,600
24,416
-
49,475,985
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the company in
proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and
the company does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
Share buy-back
There is no current on-market share buy-back.
44
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 29. Equity - reserves
Foreign currency reserve
Share-based payments reserve
Consolidated
2020
$
2019
$
48,088
495,624
47,641
-
543,712
47,641
Foreign currency reserve
The reserve is used to recognise exchange differences arising from the translation of the financial statements of foreign
operations to Australian dollars. It is also used to recognise gains and losses on hedges of the net investments in foreign
operations.
Note 30. Equity - accumulated losses
Accumulated losses at the beginning of the financial year
Loss after income tax expense for the year
Accumulated losses at the end of the financial year
Note 31. Financial instruments
a. Financial Risk Management Policy
Consolidated
2020
$
2019
$
(11,370,303)
(1,272,296)
(7,043,234)
(4,327,069)
(12,642,599) (11,370,303)
The Group’s financial instruments consist mainly of deposits with banks, accounts receivable and payable, loans to and
from subsidiaries and loans from third parties.
The Board and Management monitor risks on a regular basis as part of formal board meeting and ongoing analysis and
review by management
i. Financial Risk Exposures and Management
The main risks the Group is exposed to through its financial instruments are liquidity risks, foreign currency risk and credit
risk.
Liquidity risks
The Group’s approach to managing liquidity is to ensure, that it will have sufficient liquidity to meet its liabilities when they
are due, under both normal and stressed conditions.
Foreign currency risk
The Group is exposed to fluctuations in foreign currencies arising from the sale and purchase of goods and services in
currencies other than the group’s measurement currency. The management managed the foreign currency transactions
on a monthly basis to avoid the fluctuation on the exchange rate, while the Group does not have any material foreign
currency risk exposure. Where exposures do arise, forward foreign exchange contracts will be applied.
45
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 31. Financial instruments (continued)
Credit risk
The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised
financial assets is the carrying amount, net of any expected loss provisions of those assets, as disclosed in the statement
of financial position and notes to the financial statements.
There are no material amounts of collateral held as security at 30 June 2020.
b. Financial Instruments
i. Derivative Financial Instruments
The Group has not participated in the use of any derivative financial instruments during the year.
ii. Financial instrument composition and maturity analysis
The tables below reflect the weighted average effective interest rate on classes of financial assets and financial liabilities:
Effective
Interest Rate
2020
%
Effective
Interest Rate
2019
%
Floating
Interest Rate
2020
$
Floating
Interest Rate
2019
$
Non-interest
Bearing
2020
$
Non-interest
Bearing
2019
$
Total
2020
$
Total
2019
$
Cash
Trade and other
receivables
-
-
1.71%
-
-
-
6,731,306
6,119,362
-
6,119,362
6,731,306
-
1,532,937
711,573
1,713,301
711,573
Financial Liabilities
Loan – Quality Life
Loan – Eclipx Commercial
Finance Lease
Lease – BOQ
Logistics
Lease – Motor vehicle ute
Lease – Motor vehicle bus
Trade and sundry payables are expected to be paid as follows:
Less than 6 months
Over 6 months
Fixed Interest
Rate
2020
%
Fixed Interest
Rate
2019
%
Total
2020
Total
2019
4.00%
-
-
8.50%
5,000,000
-
-
89,054
Implicit
interest Rate
2019
%
Total
2020
$
Total
2019
$
2020
%
10.30%
12.30%
-
-
10.30%
12.30%
6.38%
5.89%
46,633
271,560
-
-
51,503
696,207
4,496
-
30 June
2020
$
30 June
2019
$
3,054,055
17,247
1,277,015
5,017
3,071,302
1,282,032
Interest Rate Risk and Foreign Currency Risk
The Group has not performed a sensitively analysis relating to its exposure to interest rate risk and foreign currency risk
at balance date as this risk is not material given the Quality Life loan is in Australian dollars and is at predominately fixed
interest rate.
46
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 31. Financial instruments (continued)
Remaining contractual maturities
The amounts disclosed in the above tables are the maximum amounts allocated to the earliest period in which the
guarantee could be called upon. The Group does not expect these payments to eventuate.
Note 32. Key management personnel disclosures
Directors
The following persons were directors of Lark Distilling Co. Ltd during the financial year:
Mr David Dearie
Mr Geoff Bainbridge
Mr Warren Randall
Mr Laurent Ly
Ms Laura McBain
Executive Chairman
Managing Director
Non-Executive Director
Non-Executive Director (appointed 2 September 2019)
Non-Executive Director (appointed 25 May 2020)
Compensation
The aggregate compensation made to directors and other members of key management personnel of the Group is set out
below:
Short-term employee benefits
Long-term benefits
Share-based payments
Note 33. Remuneration of auditors
Consolidated
2020
$
2019
$
664,951
10,490
451,274
811,289
26,260
-
1,126,715
837,549
During the financial year the following fees were paid or payable for services provided by Deloitte Touche Tohmatsu, the
auditor of the company (the prior year auditor was MNSA Pty Ltd):
Consolidated
2020
$
2019
$
Audit services - Deloitte Touche Tohmatsu (2019: Mark Schiliro and Associates (MNSA)
Pty Ltd)
Audit or review of the financial statements
108,000
215,667
Other services - Deloitte Touche Tohmatsu (2019: Mark Schiliro and Associates (MNSA)
Pty Ltd)
Nil
Other services - network firms
Sub-lease of premises*
-
3,468
108,000
219,135
-
43,771
* Rent paid to Mark Schiliro and Associates (MNSA) Pty Ltd (being a related company to MNSA Pty Ltd) on a sub-lease
of premises on the same terms as the primary lease between MNSA and an independent third party
47
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 34. Commitments
The Group is exploring possible distillery expansion including further barrel storage options, but no decisions have been
made in relation to these capital costs as at the date of this report. Upon adoption AASB 16 from 1 July 2019, the majority
of operating leases are now recognised on the balance sheet.
There are no other commitments for the Group for the period ended 30 June 2020.
Note 35. Related party transactions
During the period ended 30 June 2020, the Group made purchases amounting to $73,084 (June 2019: NIL) from an entity
associated with Warren Randall (Non-Executive Director). These transactions were for the purchase of wooden barrels
from Seppeltsfield Wines Pty Ltd (ABN: 97 127 078 282) for the Group to use in its’ production process of Lark.
During the prior period ending 30 June 2019, the Group made purchases totalling $286,186 from entities associated with
Mr Chris Malcolm during his tenure as Chief Executive Officer. These include sale of finished goods for $1,666, payments
for the cooperage of wood (casks) for $280,845 and the purchase of barrels from related entities for $70,798.
These transactions were considered to be arms-length transactions.
Subsidiaries
Interests in subsidiaries are set out in note 37.
Key management personnel
Disclosures relating to key management personnel are set out in note 32 and the remuneration report included in the
directors' report.
Note 36. Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of financial position
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Issued capital
Foreign currency reserve
Share-based payments reserve
Accumulated losses
Total equity
Parent
2020
$
2019
$
4,500,312
6,273,581
44,154,887 42,315,786
197,013
393,715
5,197,013
421,799
49,475,985 49,361,970
16,397
-
(7,484,380)
16,397
471,208
(11,005,716)
38,957,874 41,893,987
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2020 and 30 June 2019.
48
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 36. Parent entity information (continued)
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2020 and 30 June 2019.
Capital commitments - Property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment as at 30 June 2020 and 30 June 2019.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 2, except for the
following:
●
Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity.
●
Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt may be an
indicator of an impairment of the investment.
Note 37. Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in
accordance with the accounting policy:
Name
Australian Whisky Holdings Bothwell Pty Ltd
Australian Whisky Holdings Services Pty Ltd
Australian Whisky Holdings Management Pty Ltd
Aowei Liquor Industries Beijing Limited (former name
Beijing Montec Commercial Limited)
Australian Whisky Holdings (HK) Limited (former
name Montec International (HK) Limited)
Lark Distillery Pty Ltd
Principal place of business /
Country of incorporation
Ownership interest
2019
2020
%
%
Level 1, 30 Argyle Street, Hobart
TAS 7000
Level 1, 30 Argyle Street, Hobart
TAS 7000
Level 1, 30 Argyle Street, Hobart
TAS 7000
Beijing PRC 100022
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
Kowloon, Hong Kong
100.00%
100.00%
20 Denholms Road, Cambridge,
TAS 7170
100.00%
100.00%
Note 38. Events after the reporting period
On 3 July 2020 Lark Distilling Co. announced the appointment of Alex Aleksic as the Chief Financial Officer of the group.
On 18 September 2020, Lark Distilling Co. successfully raised A$8.85 million via an institutional placement of shares.
Total shares issued as part of this placement were 8,052,334 at a price of $1.10 per share. The proceeds raised under
the placement will be used to fund the inventory build of Lark’s whisky under maturation. The new shares issued were
settled on 22 September 2020.
No other matter or circumstance has arisen since 30 June 2020 that has significantly affected, or may significantly affect
the Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
49
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 39. Reconciliation of loss after income tax to net cash used in operating activities
Loss after income tax expense for the year
(1,272,296)
(4,327,069)
Consolidated
2020
$
2019
$
Adjustments for:
Depreciation and amortisation
Impairment charges
Lease payments classified as financing
Payables settled via share issue
Non-cash share based payments
Change in operating assets and liabilities:
Decrease/(increase) in trade and other receivables
Increase in inventories
Decrease in prepayments
Increase in other provisions
Decrease in financial assets
Decrease/Increase in trade creditors and accruals
Net cash used in operating activities
Note 40. Earnings per share
298,492
-
23,958
114,016
496,071
220,246
1,367,269
-
139,010
-
(862,490)
(4,503,373)
18,124
29,110
300,000
1,830,396
265,865
(3,158,048)
282,369
(35,005)
254,232
450,740
(3,527,992)
(4,540,391)
Consolidated
2020
$
2019
$
Loss after income tax attributable to the owners of Lark Distilling Co. Ltd
(1,272,296)
(4,327,069)
Weighted average number of ordinary shares used in calculating basic earnings per share
54,381,840
54,360,163
Number
Number
Weighted average number of ordinary shares used in calculating diluted earnings per
share
Basic loss per share
Diluted loss per share
54,381,840
54,360,163
Cents
Cents
(2.34)
(2.34)
(7.96)
(7.96)
Prior year earnings per share have been restated as part of the 30 for 1 consolidation completed in April 2020.
Note 41. Share-based payments
A share option plan has been established by the Group and approved by shareholders at a general meeting, whereby the
Group may, at the discretion of the Nomination and Remuneration Committee, grant options over ordinary shares in the
company to certain key management personnel of the Group. The options are issued for nil consideration and are granted
in accordance with performance guidelines established by the Nomination and Remuneration Committee.
50
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Notes to the financial statements
30 June 2020
Note 41. Share-based payments (continued)
Set out below are summaries of options granted under the plan:
2020
Exercise
Balance at
the start of
Grant date
Expiry date
price*
the year
Granted
Exercised
Expired
Balance at
the end of
Effect of share
consolidation**
the year
31/12/2017
31/12/2017
22/05/2018
22/05/2018
22/05/2018
22/10/2018
28/11/2017
30/11/2019
17/10/2019
30/05/2021
30/05/2021
30/05/2021
01/11/2020
31/07/2021
$1.830
$1.140
$0.900
$1.140
$1.350
$0.960
$2.250
14,983,337
3,724,975
4,141,380
4,141,380
4,141,380
3,115,265
4,250,000
38,497,717
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(14,983,337)
(3,724,975)
-
-
-
-
-
(18,708,312)
-
-
(4,003,334)
(4,003,334)
(4,003,334)
(3,011,423)
(4,108,333)
(19,129,758)
-
-
138,046
138,046
138,046
103,842
141,667
659,647
*
**
Exercise price includes the effects of the 30 for 1 consolidation completed in April 2020.
Movement as a result of the 30 for 1 consolidation completed in April 2020.
The weighted average remaining contractual life of options outstanding at the end of the financial half-year was 0.86 years
(June 2019: 1.15 years).
Set out below are summaries of performance rights granted under the plan:
2020
Grant date
Expiry date
25/11/2019
25/11/2019
25/11/2019
25/11/2019
25/11/2019
16/03/2020
16/03/2020
16/03/2020
16/03/2020
31/12/2026
31/12/2026
31/12/2026
31/12/2026
31/12/2026
31/12/2026
31/12/2026
31/12/2026
31/12/2026
Vesting
hurdle
Balance at
the start of
the year
Granted
Exercised
Effect of share
consolidation*
Balance at
the end of
the year
$1.350
$1.650
$1.950
$2.250
$2.550
$1.650
$1.950
$2.250
$2.550
-
-
-
-
-
-
-
-
-
-
4,500,000
3,300,000
3,900,000
28,500,000
45,000,000
6,000,000
5,400,000
4,800,000
4,200,000
105,600,000
-
-
-
-
-
-
-
-
-
-
(4,350,000)
(3,190,000)
(3,770,000)
(27,550,000)
(43,500,000)
(5,800,000)
(5,220,000)
(4,640,000)
(4,060,000)
(102,080,000)
150,000
110,000
130,000
950,000
1,500,000
200,000
180,000
160,000
140,000
3,520,000
*
Movement as a result of the 30 for 1 consolidation completed in April 2020.
The weighted average remaining contractual life of performance rights outstanding at the end of the financial year was 6.5
years (June 2019: NIL).
For the performance rights granted during the current financial year, the valuation model inputs used to determine the fair
value at the grant date, are as follows:
Grant date
Expiry date
Share price
at grant date
Vesting
hurdle
Expected
volatility
Dividend
yield
Risk-free
interest rate
Fair value
at grant date
25/11/2019
25/11/2019
25/11/2019
25/11/2019
25/11/2019
16/03/2020
16/03/2020
16/03/2020
16/03/2020
31/12/2026
31/12/2026
31/12/2026
31/12/2026
31/12/2026
31/12/2026
31/12/2026
31/12/2026
31/12/2026
$0.037
$0.037
$0.037
$0.037
$0.037
$0.030
$0.030
$0.030
$0.030
$0.045
$0.055
$0.065
$0.075
$0.085
$0.055
$0.065
$0.075
$0.085
70.00%
70.00%
70.00%
70.00%
70.00%
65.00%
65.00%
65.00%
65.00%
-
-
-
-
-
-
-
-
-
1.09%
1.09%
1.09%
1.09%
1.09%
0.92%
0.92%
0.92%
0.92%
$0.03580
$0.03490
$0.03340
$0.03210
$0.03170
$0.02610
$0.02540
$0.02420
$0.02330
The price and valuation numbers noted in the table above are all exclusive of the 30-for-1 consolidation completed in April
2020.
51
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Directors' declaration
30 June 2020
In the directors' opinion:
●
●
●
●
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;
the attached financial statements and notes comply with International Financial Reporting Standards as issued by
the International Accounting Standards Board as described in note 2 to the financial statements;
the attached financial statements and notes give a true and fair view of the Group's financial position as at 30 June
2020 and of its performance for the financial year ended on that date; and
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
___________________________
David Dearie
Chairman
25 September 2020
52
For personal use only
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Level 8
22 Elizabeth Street
Hobart TAS 7000
GPO Box 777
Hobart TAS 7001 Australia
Tel: +61 3 6237 7000
Fax: +61 3 6237 7001
www.deloitte.com.au
Independent Auditor’s Report to the Members of
Lark Distilling Co Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Lark Distilling Co. Limited (the “Company”) and its
subsidiaries (the “Group”) which comprises the consolidated statement of financial position as at 30
June 2020, the consolidated statement profit or loss and other comprehensive income, the
consolidated statement of changes in equity and the consolidated statement of cash flows for the
year then ended, and notes to the financial statements, including a summary of significant accounting
policies and other explanatory information, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
(i)
giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its
financial performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional & Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with
the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has
been given to the directors of the Company, would be in the same terms if given to the directors as
at the time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance
in our audit of the financial report for the current period. These matters were addressed in the context
of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Asia Pacific Limited and the Deloitte Network
54
53
For personal use only
Key Audit Matter
How the scope of our audit responded to the Key Audit Matter
Carrying value of goodwill
Our procedures included, but were not limited to:
•
•
•
•
•
Evaluating the appropriateness of management’s identification
of the Whisky CGU to which the goodwill is allocated;
Assessing the reasonableness of cash flow projections and
assessing growth rates;
Engaging our valuation specialists to assess the key
assumptions and methodology used by management in the
impairment model, in particular the discount rate and the
terminal growth rate;
Evaluating the value in use estimates determined by the
Group against its market capitalisation; and
Testing the mathematical accuracy of the impairment model.
We have also assessed the appropriateness of the disclosures in to the
financial statements.
of
$10,934,839
At 30 June 2020, Lark has reported
goodwill
as
disclosed in note 22 of the financial
report. The accounting policy and
the
significant estimates and
judgements in relation to goodwill
impairment testing are disclosed in
3.
notes
The goodwill relates to one Cash
Generating Unit (“CGU”) at the
level (Whisky) where
Segment
goodwill
by
management.
is monitored
The Group is required to assess the
carrying value of goodwill at least
annually. This is performed through
a Value-in-Use discounted cash
flow analysis.
used
The value
in use calculation
includes key assumptions and
judgements
the
determination of the recoverable
amounts including forecast future
cash flows, the long term growth
rate
rate
and
assumptions.
discount
in
Other Information
The directors are responsible for the other information. The other information comprises the
information included in the Group’s Annual Report for the year ended 30 June 2020, but does not
include the financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If,
based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
54
For personal use only
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.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk
of not detecting a material misstatement resulting from fraud is higher than for one resulting
from error, as
intentional omissions,
involve collusion,
fraud may
misrepresentations, or the override of internal control.
forgery,
• Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Group’s internal control.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Group’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the financial
report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the Group to cease to continue as a going concern.
•
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and
events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities
or business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group’s audit. We remain
solely responsible for our audit opinion.
55
For personal use only
We communicate with the directors regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control that
we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, actions
take to eliminate threats or safeguards applied.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the Directors’ Report for the year ended 30
June 2020.
In our opinion, the Remuneration Report of Lark Distilling Co. Limited, for the year ended 30 June
2020, complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
DELOITTE TOUCHE TOHMATSU
Carl Harris
Partner
Chartered Accountants
Hobart, 25 September 2020
56
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Shareholder information
30 June 2020
The shareholder information set out below was applicable as at 6 September 2020.
Distribution of equitable securities
Analysis of number of equitable security holders by size of holding:
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Number of
holders of
ordinary
shares
Number of
ordinary
shares held
Percentage
of ordinary
shares held
238
247
84
125
112,916
627,065
635,992
3,724,529
57 49,352,376
210
1,150
1,170
6,840
90,630
751 54,452,878
100,000
Holding less than a marketable parcel
103
17,696
3,250
Equity security holders
Twenty largest quoted equity security holders
The names of the twenty largest security holders of quoted equity securities are listed below:
Ordinary shares
Number held
% of total
shares
issued
6,004,513
5,351,320
4,065,040
3,417,897
2,680,478
2,389,295
1,987,147
1,544,166
1,281,666
1,230,625
1,171,250
1,166,666
965,000
896,274
841,666
820,649
800,000
772,458
765,342
683,333
11.03
9.83
7.47
6.28
4.92
4.39
3.65
2.84
2.35
2.26
2.15
2.14
1.77
1.65
1.55
1.51
1.47
1.42
1.41
1.25
38,834,785
71.34
Quality Life Pty Ltd (The Neill Family A/C)
HSBC Custody Nominees
Ace Cosmo Developments Limited
Malcolm Property Pty Ltd (Malcolm Property A/C)
Bainbridge Family Pty Ltd (Bainbridge Family A/C)
Seppeltsfield Pty Ltd (Seppeltsfield Estate A/C)
C H Malcolm Super Pty Ltd (Malcolm Super Fund A/C)
Mr Timothy Tulloch Brock Lewis & Mrs Catherine Anne Lewis (Jg Lewis No2 Will A/C)
Mark Murton Pty Ltd (Mark Murton P/L S/F A/C)
Suetone Pty Ltd (The Ak Shadforth Family A/C)
Fairisle Holdings Pty Limited (The Tilanbi A/C)
Rhodium Capital Pty Ltd (Rhodium Investment A/C)
Kore Management Services Pty Ltd (Cuthbertson Pension Fund A/C)
Contec Properties Pty Limited
Rex Family Pension Plan Pty Ltd (Rex Family Pension Plan A/C)
HSBC Custody Nominees (Australia) Limited - A/C 2
Steele Investments Superannuation Fund Pty Ltd (Steele Super Fund A/C)
Kore Management Services Pty Ltd (Cuthbertson Super Fund A/C)
Jon Birch Australia Pty Ltd (The Birch Super Fund A/C)
Ace Cosmo Developements Limited
Unquoted equity securities
There are no unquoted equity securities.
57
For personal use only
Lark Distilling Co. Ltd
(Formerly known as Australian Whisky Holdings Limited)
Shareholder information
30 June 2020
Substantial holders
Substantial holders in the company are set out below:
Quality Life Pty Ltd (The Neill Family A/C)
HSBC Custody Nominees
Ace Cosmo Developments Limited
Malcolm Property Pty Ltd (Malcolm Property A/C)
Voting rights
The voting rights attached to ordinary shares are set out below:
Ordinary shares
Number held
% of total
shares
issued
7,156,769
5,351,320
4,065,040
3,417,897
13.14
9.83
7.47
6.28
Ordinary shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
There are no other classes of equity securities.
Securities subject to voluntary escrow
Corporate Governance Statement
The Company’s 2020 Corporate Governance Statement has been released to ASX on this day and is available on the
Company’s website at: https://larkdistillery.com/investor-centre/
Annual General Meeting and Director Nomination
Lark Distilling Co. Ltd advises that its Annual General Meeting will be held on or about Thursday, 26 November 2020. The
time and other details relating to the meeting will be advised in the Notice of Meeting to be sent to all Shareholders and
released to ASX immediately upon despatch.
The Closing date for receipt of nomination for the position of Director is Thursday, 8 October 2020. Any nominations must
be received in writing no later than 5.00pm (Melbourne time) on Thursday, 1 October 2020 at the Company’s Registered
Office. The Company notes that the deadline for nominations for the position of Director is separate to voting on Director
elections. Details of the Director’s to be elected will be provided in the Company’s Notice of Annual General Meeting in
due course.
58
For personal use only