A N N U A L R E P O R T 2 0 2 4
LOVI SA H O L D I N GS L I M I T ED
C O N T E N T S
O v e r v i e w
0 3
C h a i r m a n ’ s R e p o r t
0 8
D i r e c t o r s ’ R e p o r t
1 1
F i n a n c i a l S t a t e m e n t s
Consolidated statement of financial position
37
Consolidated statement of profit or loss and
other comprehensive income
38
Consolidated statement of changes in equity
39
Consolidated statement of cash flows
40
N o t e s t o F i n a n c i a l S t a t e m e n t s
Setting the scene
41
Business performance
43
Asset platform
50
Risk and capital management
58
Other information
69
Consolidated Entity Disclosure Statement
81
Signed Reports
Directors’ declaration
87
Independent auditor’s report
88
Lead auditor’s independence declaration
93
A S X I n f o r m a t i o n
Shareholder information
97
Corporate Directory
103
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900 STORES IN 46 COUNTRIES ON 6 CONTINENTS
CONTINUED EXPANSION OF GLOBAL FOOTPRINT
7 NEW MARKETS OPENED DURING THE YEAR
ONGOING INVESTMENT IN PEOPLE AND INFRASTRUCTURE
STRONG BALANCE SHEET TO SUPPORT FUTURE GROWTH POTENTIAL
B E C O M I N G A G L O B A L L E A D E R
O V E R V I E W
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900
T O T A L S T O R E S
128 NEW STORES
OPENED FOR THE
PERIOD
$698.7M
R E V E N U E
(UP 17.1%)
$128.2M
E B I T
(UP 21.2%)
$82.4M
N P A T
(UP 20.9%)
87.0c
F U L L Y E A R
D I V I D E N D S
(UP 18.0 CENTS)
H I G H L I G H T S
O V E R V I E W
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O V E R V I E W
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Total Owned
865
765
Owned
FY24
FY23
Asia
Singapore
16
16
Malaysia
44
41
Hong Kong
9
8
Taiwan
1
1
Vietnam
1
0
China
1
0
Africa
South Africa
81
75
Botswana
3
1
Namibia
3
2
Middle East
UAE
5
1
O V E R V I E W
S T O R E N U M B E R S
Owned
FY24
FY23
Aus/NZ
Australia
178
168
New Zealand
28
27
Americas
USA
207
190
Canada
14
7
Mexico
4
4
Europe/UK
UK
50
44
France
86
68
Germany
53
47
Belgium
17
11
Switzerland
8
9
Netherlands
9
7
Austria
9
7
Luxembourg
2
2
Poland
19
18
Spain
2
1
Hungary
2
2
Romania
1
1
Italy
9
7
Ireland
3
0
Franchise
FY24
FY23
Middle East
15
28
Africa
5
2
South America
15
6
G L O B A L R E A C H
K EY
Owned Stores
Franchise
TOTAL STORES
900 801
Total Franchise
35
36
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O V E R V I E W
Lovisa was born from a desire to fill the void for fashion forward
and directional jewellery that is brilliantly affordable.
Now trading from 900 stores across 46 countries as well as our expanding
digital presence across our own websites and third party marketplaces, the
customer is at the centre of everything we do. Our business model ensures
trends are quickly identified and our customers are provided with a broad,
quality product range. We have deployed a vertically integrated business
model through which we develop, design, source and merchandise 100%
Lovisa branded products.
A B O U T L O V I S A
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C H A I R M A N ’ S R E P O R T
This year has been marked by significant strides in our
global expansion and continued growth across multiple
markets. Some of the operational highlights of the past year
and our plans for the future are set out below.
Store Expansion
We opened 128 new stores during FY24, bringing our total
store count to 900 stores. This expansion has solidified our
position as a leading jewellery retailer in numerous markets
worldwide.
Market Penetration
We entered 7 new markets in FY24, including China,
Vietnam, Ireland, Senegal, Ecuador, Guadeloupe, and
Gabon. Building on this momentum, we have already
expanded our presence to Ivory Coast, the Republic of
Congo, and Panama since the end of the financial year.
Global Footprint
Our operations now span 6 continents, and at the date of
this report we are now serving customers in 49 markets
and trading in 32 currencies. This remarkable achievement
underscores our organisational capabilities.
Distribution Centres
In August 2024, we opened our third Lovisa operated
inventory distribution centre in Columbus, Ohio, USA. This
facility added 45 new Lovisa team members. Since opening,
the warehouse has already successfully received 2 million
units and dispatched 1 million units of inventory, whilst
providing no disruption to our store and customer network.
As our operations in the Americas region expand, we
anticipate that this warehouse has the capacity to support
over 1,000 stores, handling all inventory needs including
those for e-commerce, marketplaces, fixtures, back-of-house
supplies, and marketing materials. This facility represents
the second major company-owned warehouse we have
launched in under 18 months, following our opening last
year in Wroclaw, Poland. This move aligns with our strategy
to provide continuous improvement to our distribution
services via Lovisa’s in-house teams rather than relying on
third-party logistics providers.
Combined with our existing warehouses in Melbourne,
Australia and Qingdao, China, we are ready to support
our growing network of stores globally and ensure efficient
logistics and timely delivery of products to our customers.
Our People
Our global team continues to be the backbone of our
success. Their passion, expertise, and commitment to Lovisa
have been instrumental in driving our growth and achieving
our goals.
This is an appropriate place to pause and reflect. Fourteen
years ago, we set out to create a concept “To bring
brilliantly affordable, on trend jewellery to the women of
the world”. I am both lucky and grateful to sit at the pinnacle
of an organisation that has achieved this mission in a very
short period. We have become big, really big. I continue to
applaud, acknowledge and be very grateful for the many
individuals at Lovisa who continuously contribute to our
great story. It is important that I highlight some examples
of remarkable individuals that have contributed so strongly
to Lovisa. We are lucky to have them and many others like
them.
Avitra Brhma Dava – Country Manager, Singapore
Feb 2017
Age 21 Part-Time Team Member (IOI
City Mall Malaysia)
Nov 2017
Full Timer (Internship Genting Highlands
Malaysia)
Apr 2018
Store Manager (Fahrenheit 88
Malaysia)
Sep 2018
Store Manager (Nu Sentral Malaysia)
Mar 2019
Accepted into Global Future Lovisa
Leaders Malaysia program
Aug 2019
Flagship Store Manager (KLCC
Malaysia)
Feb 2020
Regional Manager (Malaysia)
Jun 2024
Country Manager (Singapore)
Brooke Tipton – Global Visual Merchandise Manager,
Australia
Jun 2015
Age 17, Part-Time Team Member
(Chadstone, Australia)
Jun 2016
Store Manager (Doncaster, Victoria
Gardens, and Melbourne
Central locations, Australia)
Sep 2018
Visual Merchandiser (Australia)
Dec 2019
Senior Visual Merchandiser (Australia)
Dec 2021
Global Visual Merchandise Manager
(manages over 1,000 planograms
and leads product operations
communications for the
broader business)
C H A I R M A N ’ S R E P O R T
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C H A I R M A N ’ S R E P O R T
Georgia Holman – Regional Training Manager, Europe
Aug 2017
Age 16, Part-Time Team Member
(Guildford, UK)
Nov 2019
Store Manager (Hammersmith, UK)
Mar 2020
Accepted into Global Future Lovisa
Leaders program
Aug 2020
Store Manager (flagship store Stratford,
UK)
Apr 2021
Store Manager (flagship store White
City, UK)
Oct 2021
Regional Manager (Central London,
UK)
Mar 2024
Regional Training Manager, Europe
Helena Klassmann - State Manager, Queensland and
Northern Territory, Australia
Sep 2017
Age 20, Part-Time Team Member
(Kawana, Australia)
Mar 2018
Store Manager (Noosa, Australia)
Mar 2019
Accepted into Global Future Lovisa
Leaders program
May 2019
Regional Manager (Queensland,
Australia)
Jan 2020
State Manager (South Australia)
Oct 2022
New Store Openings Operation
Support (United Kingdom and Europe)
Dec 2023
State Manager (Queensland and
Northern Territory, Australia)
Victor Herrero – Global CEO
Finally, not forgetting our remarkable Global CEO,
Victor Herrero. After a phenomenal 3-year run, Victor
will be stepping down on 31 May, 2025. It has been an
outstanding three years together with the opening of 25 new
markets and increasing the store network by 350 stores so
far, now at over 900 stores globally. The Board of Directors
extends their heartfelt thanks for his exceptional effort and
contributions to Lovisa.
John Cheston
A new era - starting 4 June, 2025, the reins will be passed to
the talented John Cheston. With a wealth of retail experience
and a proven track record of success, John is poised to take
Lovisa to even greater heights. Get ready for a new era of
operational excellence, growth, innovation, and excitement
under his leadership!
Our Priorities
We continue to remind everybody that our customer comes
first and sits at the top of our ‘inverted’ organisational
pyramid, with our focus on:
•
Delivering operational excellence across our physical
and digital stores to drive comparable store sales
growth in our existing store network;
•
Acceleration of our store network growth and
expansion of our market presence;
•
Continued investment in our people, their development
and succession; and
•
Continued refinement and investment in technologies
and infrastructure that will keep us nimble, efficient
and better able to globalise our support functions.
I want to express my deepest gratitude to our customers,
teams, board members, and loyal shareholders. Our
collective efforts are the driving force behind our sustainable
growth and long-term success.
With our team’s dedication and the strength of our business
model, I am confident we will continue to create value for
our customers and shareholders, whilst providing a huge
opportunity for our team to grow wherever they choose to.
Brett Blundy
Chairman of the Board
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D I R E C T O R S ’ R E P O R T
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D I R E C T O R S ’ R E P O R T
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D I R E C T O R S ’ R E P O R T
Details of the qualifications and experience of each Director in accordance with the requirements
of the Corporations Act have been included below.
Tracey Blundy
Brett Blundy
Bruce Carter
John Charlton
Victor Herrero
Sei Jin Alt
Brett Blundy
Non-Executive Director & Chairman
Appointed 1 November 2018
Chairman of the Board
Along with being the Chairman, co-founder and substantial shareholder
of Lovisa, Brett is also the Chairman and Founder of BB Retail Capital
(“BBRC”), a private investment group with diverse global interests across
retail, capital management, retail property, beef, and other innovative
ventures. Brett is one of Australia’s most successful retailers, with BBRC’s
retail presence extending to over 2,000 stores across 45 countries. Brett
is currently a non-executive Director of Accent Group Limited (ASX:AX1).
Victor Herrero
Chief Executive officer
Appointed 14 October 2021
Victor brings vast global experience having spent 13 years with the Inditex
Group, one of the world’s largest fashion retailers with 8 store formats
such as Zara, Pull & Bear and Massimo Dutti. The Inditex group with over
7,000 stores in 80 markets and sales over US$30billion pioneered fast
fashion retailing growing numerous brands, including Zara, around the
world. During Victor’s time at Inditex, he held numerous roles including
Head of Asia Pacific and Managing Director Greater China and led the
company’s expansion through this region rolling out 800 stores across
multiple countries including China and India.
Victor also spent four years as CEO of global retail brand Guess based
in California, and was most recently Chairman and CEO of international
shoe manufacturer and retailer Clarks. Victor is also director of G-III
Apparel Group (Nasdaq Listed) and Viva China Holdings Limited (listed
on the Hong Kong Stock Exchange).
Tracey Blundy
Non-Executive Director
Appointed 6 November 2014
Member of the Audit, Business Risk & Compliance Committee
Chair of the People, Leadsership, Remuneration & Nomination
Committee
Tracey joined BB Retail Capital in 1981 and is a nominated representative
of BB Retail Capital on the Board of Lovisa. Tracey has held a number
of senior executive positions across BB Retail Capital’s brands, including
Chief Executive Officer of Sanity Entertainment and Bras n Things. She is
a Board-level advisor across the BB Retail Capital portfolio bringing in-
depth knowledge and expertise on retail operations and roll-out strategy.
Tracey was a founding shareholder of Lovisa in 2010, and has since been
a senior advisor to the Company’s management team. Tracey is currently a
Director of BB Retail Capital Pty Limited and BB Retail Property Pty Limited.
John Charlton
Independent Non-Executive Director
Appointed 26 August 2020
Member of the Audit, Business Risk & Compliance Committee
Member of the People, Leadership, Remuneration & Nomination
Committee
John is a career retailer and brings over 38 years’ experience in retailing
operations in Australia. He was previously the founder and owner of
Spendless Shoes Pty Ltd, a company he grew to 248 stores as well as
a successful online site before selling to The Shoe Group in July 2019.
He has served as a member of the Council of Wilderness School for 12
years (7 years as Chair), Saint Peter’s College for 5 years, is currently
a member of the Council of the University of Adelaide, and is a Non-
Executive Director of the Detmold Group Advisory Board.
Bruce Carter AO
Independent Non-Executive Director
Appointed 18 November 2022
Member of the People, Leadership, Remuneration & Nomination
Committee
Chairman of the Audit, Business Risk & Compliance Committee
Bruce has spent over 30 years in corporate recovery and insolvency and
was formerly managing partner at Ferrier Hodgson Adelaide for 19 years
and prior to that a partner at Ernst & Young, Chair of the South Australian
Economic Development Board and a member of the Executive Committee
of Cabinet. He holds a Masters of Business Administration from Heriot-
Watt University and a Bachelor of Economics from University of Adelaide.
He is a Fellow of both the Institute of Chartered Accountants in Australia
and the Australian Institute of Company Directors. Bruce is currently Chair
of the Australian Submarine Corporation, chair of AIG Australia Ltd and
a director of Bank of Queensland Limited. Bruce is a former director of
Crown Resorts Limited, SkyCity Entertainment Group Ltd, Genesee and
Wyoming Inc (NYSE) and the Aventus Group.
Sei Jin Alt
Independent Non-Executive Director
Appointed 19 February 2019
Sei Jin brings to the Board broad merchandising, managerial, financial,
and operational experience in multiple fashion categories as well as
business leadership expertise gained over 20 years in the industry
across a number of major US retailers including Francesca’s, JC
Penny, Nordstrom and Macy’s along with advisory role experience for
wholesale and retail brands.
Nico van der Merwe
Alternate Director to Brett Blundy
Appointed 19 February 2019
Nico van der Merwe has over 30 years’ experience in commercial roles
across the retail, consumer and private equity sectors. Nico has held a
number of senior financial roles in BBRC from 1997 to 2020 including
12 years as Group Chief Financial Officer and is currently an Advisor to
the Group. He holds Bachelor of Accounting Science (Hons) and Bachelor
of Commerce degrees and is a member of the Institute of Chartered
Accountants in Australia. Nico was appointed alternate director for Brett
Blundy on 19 February 2019.
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D I R E C T O R S ’ R E P O R T
1. DIRECTORS
The Directors of Lovisa Holdings Limited (the ‘Company’) present their report together with the Consolidated Financial Statements
of the Company and its controlled entities (the ‘Group’ or ‘Consolidated Entity’) for the financial year ended 30 June 2024.
Director
Board
Audit and Risk
Remuneration & Nomination
Number attended
Number held
Number attended
Number held
Number attended
Number held
T Blundy
5
5
4
4
5
5
B Carter
5
5
4
4
5
5
V Herrero
4
5
4
4
5
5
B Blundy
5
5
3
4
5
5
J Charlton
4
5
4
4
5
5
S J Alt
5
5
4
4
5
5
N van der Merwe
-
-
4
4
-
-
1.1 Company Secretary
Chris Lauder was appointed Company Secretary on 15 September 2017. He is also the company’s Chief Financial
Officer. Mr Lauder is a Chartered Accountant.
1.2 Directors Interests in Shares
The relevant interest of each Director in the Company at the date of the report is as follows:
Director
Ordinary Shares
in the Company
B Blundy (1)
43,207,500
T Blundy (2)
1,153,005
V Herrero
2,140,328
J Charlton
29,000
S J Alt
-
B Carter
15,000
N van der Merwe
-
(1) Shares held by BB Retail Capital Pty Ltd
(2) Shares held by Coloskye Pty Ltd
2. PRINCIPAL ACTIVITIES
The principal activity of the Group during the financial year was the retail sale of fashion jewellery and accessories. The
business has 900 retail stores in operation at 30 June 2024 across 46 markets, including 35 franchise stores. There was no
significant change in the nature of the activities of the Group during the period.
Lovisa Holdings Limited Annual Report - 30 June 2024
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D I R E C T O R S ’ R E P O R T
3. DIVIDENDS
Dividends paid to members during the financial year were as follows:
2024
2023
$000's
$000's
Final ordinary dividend for the year ended 2 July 2023 of 31.0 cents per fully paid share 70% franked paid on
19 October 2023 (2023: 37.0 cents, 30% franked)
34,005
39,898
Interim ordinary dividend for the year ended 30 June 2024 of 50.0 cents per fully paid share 30% franked paid
on 18 April 2024 (2023: 38.0 cents, fully franked)
54,846
40,976
Total dividends paid
88,851
80,874
4. REVIEW OF OPERATIONS
The following summary of operating results and operating metrics reflects the Group’s performance for the year ended 30
June 2024:
4.1 Financial Performance
Revenue for the year ended 30 June 2024 was up 17.1% on FY23 reflecting growth in the store network offset by comparable
store sales down 2.0% on FY23, an improvement on the first half of the financial year with the Group returning to positive
comparable store sales in the second half.
This resulted in Earnings Before Interest and Tax of $128.2m, up 21.2% on FY23, and Net Profit after Tax up 20.9% on
FY23.
Consolidated $’000
2024
2023
Change
Sales
698,664
596,456
17.1%
Gross profit
565,790
476,714
18.7%
Gross Margin
81.0%
79.9%
1.1%
EBIT
128,177
105,742
21.2%
Net profit after tax (NPAT)
82,411
68,164
20.9%
Basic Earnings per share
75.4
63.3
19.1%
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D I R E C T O R S ’ R E P O R T
FY17
AUSTRALIA
OFFSHORE
435
544
629
NUMBER OF STORES IN OFFSHORE
MARKETS CONTINUED TO GROW
FY23
FY20
FY22
FY21
FY24
801
900
Revenue was $698.7m up 17.1% on FY23 with comparable
store sales down 2.0%.
The business was able to again deliver strong growth in the
store network for the financial year, with 900 stores now
trading globally across over 46 markets at financial year
end, a net increase of 99 stores including 7 new markets.
This included 128 new stores opened for the financial year,
offset by 28 closures and 1 relocation. Pleasingly the store
rollout was able to be delivered across all regions, with
14 new stores in Australia/NZ, 8 in Asia, 15 in Africa/
Middle East, 50 in Europe and 27 in the Americas as well
as 14 new franchise stores in South America, Africa and the
Middle East.
The growth in the store network included 3 new company
owned market openings in the financial year, with our first
stores opened in China, Vietnam and Ireland, complementing
the opening of 12 new markets in the year prior. Included
in store closures were 14 UAE franchise stores closed by
our franchise partner as part of the change of this market to
company owned. The growth in the store network has set a
solid foundation for ongoing growth.
4.1.3 Cost Of Doing Business, Depreciation and Net Finance
Costs
4.1.4 Earnings
Statutory earnings before interest and tax (EBIT) was
$128.2m being a 21.2% increase on EBIT from the prior
year. Statutory net profit after tax increased 20.9% to
$82.4m with EPS at 75.4 cents.
4.1.5 Cash Flow
The Group’s net cash flow from operating activities before
interest and tax was $240.4m. Capital expenditure of
$23.3m relates predominately to new store openings and
refurbishments of current stores upon lease renewal, as well
as investment into the Group’s IT systems and supply chain
capability.
The Group closed the financial year with $23.5m in net
debt, a reduction of $9.9m on the prior year.
4.1.1 Sales
Gross profit for the financial year was $565.8m, an increase
of 18.7% on the prior year. Gross Margin was 81.0%
compared to 79.9% in FY23, benefitting from ongoing focus
on price points and tight management of product cost and
inventory.
GROSS MARGIN %
FY15
FY16
FY14
FY13
FY17
77%
77%
79%
80%
81%
FY23
FY22
FY21
FY20
FY24
We were able to continue to invest in rolling out new markets,
new stores in existing markets, and the structures required
to manage them effectively on an ongoing basis, including
support teams, logistics and technology to drive a more
efficient operating model. This combined with inflationary
pressures resulted in higher cost of doing business in the
period, which was offset by a reduction in CEO Long-Term
Incentive expense from $27.0m in the prior year to $11.9m
in the current period.
Depreciation expense, including impairment expense, for the
period was up 28.5% on the prior year, impacted by the
significant growth in the store network over the past 2 years.
Net finance costs were up 36.9%, reflecting the interest
charge associated with higher lease liabilities, combined
with higher borrowings and interest rates during the year.
4.1.2 Gross Profit Margin
FY23
FY22
FY21
FY20
FY24
$242.2m
$288.0m
$458.7m
$596.5m
$698.7m
REVENUE GROWTH (A$M)
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D I R E C T O R S ’ R E P O R T
4.2 Financial Position
Consolidated
Actual
2024
$’000
Actual
2023
$’000
Change
2023/2024
%
Net debt
(23,480)
(33,350)
(29.6%)
Trade receivables and prepayments
19,445
23,202
(16.2%)
Inventories
68,622
60,098
14.2%
Trade payables and provisions
(82,106)
(57,957)
41.7%
Net lease liabilities
(53,668)
(51,846)
3.5%
Property, plant & equipment
123,588
121,389
1.8%
Intangible assets and goodwill
4,419
4,274
3.4%
Net derivative (liability)/asset
(318)
915
(134.8%)
Net current tax (liability)/receivable
3,250
(7,660)
142.4%
Net deferred tax balances
20,534
20,924
(1.9%)
Net assets/equity
80,286
79,989
0.4%
*Represents total cash and cash equivalents less total loans and borrowings.
Working capital
The Group’s net working capital position increased during the year with inventory levels increasing from $60.1m to $68.6m,
in line with growth in store network, with payables benefitting from tight cash flow management including improvements in
supplier trading terms during the year.
Property, plant and equipment
Capital expenditure during the year reflects fit out costs associated with new stores and refurbishment of existing stores, as
well as investment into technology and supply chain capability. Store fit out costs are depreciated over the expected useful
life.
Debt facilities
The Group currently has total debt facilities of $120m.
As at the end of the financial year, $54m remained drawn on the term debt facility, which has been classified as a non-
current liability due to the maturity date of the facility not being within the next 12 months.
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D I R E C T O R S ’ R E P O R T
5. BUSINESS STRATEGIES
Lovisa has achieved rapid growth since it was founded, with revenue growing from $25.5 million in FY2011 to
$698.7 million in FY2024. The Group continues to focus on its key drivers to deliver growth in sales and profit.
Growth pillar
Business
Strategy Section
Strategy
Risks
Achievements
Global
expansion
5.2
• Continue to leverage current
global territories including
continued rollout in newer
territories and filling remaining
gaps in other existing markets
• Expansion into new global
markets
• Leverage the Company’s capital
in large international markets
• Consider franchise partners for
selected territories
• Continue to develop our digital
capability and ensure that
all markets we trade in have
access to a digital sales channel
• Competition (6.1)
• Retail environment
and general economic
conditions (6.2)
• Failure to successfully
implement growth
strategies (6.4)
• Availability of
appropriately sized sites
in good locations with
satisfactory cost structures
• We continued to grow the store
network during the financial year
with net 99 new Lovisa stores
(including 128 new and 29
closed stores). This included 7
new markets opened during the
year across Europe, the Americas,
Africa and Asia.
• We now have dedicated
e-commerce sites across all key
markets in which we operate, as
well as presence on a number
of popular online marketplaces
globally.
Streamline
global supply
chain
5.3
• Streamline and optimise supply
base in Asia
• Optimise air and sea freight
whilst maintaining speed to
market operating model
• Ongoing review of size,
location and number of
warehouses globally to ensure
most efficient movement of
products to our stores
• Exchange rates (6.5)
• Product sourcing or
supply chain disruptions
• Fluctuations in global
freight costs as a result
of market disruptions
experienced by logistics
providers
• Chinese warehouse operates
to support our Asian, Americas
and African stores, Australian
warehouse to support Australia/
New Zealand, and Poland
warehouse operates to support
Europe. Since the end of the
financial year we have opened a
new warehouse in the USA (Ohio)
to support our American market.
• Dedicated warehouses now
operational in the UK, South
Africa (3PL), Malaysia and the
USA to support e-commerce sales
Enhance
existing store
performance
5.4
• Optimise and improve existing
store network
• Continue to target high traffic
shopping precincts
• Judicious pricing
• Competition (6.1)
• Retail environment
and general economic
conditions (6.2)
• Prevailing fashions and
consumer preferences
may change (6.6)
• Global roll-out of in-store piercing
service, now including nose
piercing and more premium
piercing products such as 14
carat gold and diamond studs
• We continue to close stores in sub-
optimal locations
• Investment in regional support
team structures and learning and
development to ensure consistent
high quality retail execution
Brand
proliferation
5.5
• Continue to leverage social
media to connect with
customers and increase brand
loyalty
• Prevailing fashions and
consumer preferences
may change (6.6)
• Privacy breaches
• Continued focus on online
execution across all existing
markets
• Presence on online marketplaces
in key markets
• Increased social media
engagement
Lead and
pre-empt trends
5.1
• Stay on trend with shifts in
jewellery and accessory market
• Continue to provide a high
quality and diverse product
offering
• Prevailing fashions and
consumer preferences
may change (6.6)
• Continued strong performance
being testament to an ability to
identify trends
• Implementation of Buying teams
in the UK and USA to complement
central team in Australia
5.1 Lead and Pre-Empt Trends
Product innovation is a core component of Lovisa’s competitive advantage. Our customers expect a broad range of fashionable
products that are in line with the latest global fashion trends. In order to meet this expectation, Lovisa employs a large
and experienced product team who are responsible for Lovisa’s forward range planning, designs, product development,
production, visual merchandising and merchandise planning, ensuring Lovisa is continually meeting market demand. Whilst
the product team is primarily based in Melbourne, teams are now also in place in London and Los Angeles to provide more
constant localised intelligence to the global buying process, with the team also travelling the world to identify global trends.
In addition, its product teams meet with suppliers in China, India, Thailand and other parts of Asia frequently.
As Lovisa is frequently developing new products in response to evolving fashion trends, it does not register patents on its
product designs. This is consistent with practices in the fast fashion industry.
Lovisa Holdings Limited Annual Report - 30 June 2024
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D I R E C T O R S ’ R E P O R T
5.2 New Store Rollouts & International Expansion
One of the key attributes of the Group’s success has been the ability to identify and secure quality retail store sites in locations
with high pedestrian traffic. This typically involves securing leases in AA, A or B grade rating shopping centres and malls.
Lovisa has refined its global store model based on what it understands to be the optimal store size, location and format. The
combination of a target 50-80 square metre floor space and a homogenised layout allows Lovisa to have strict criteria when
identifying and securing potential store sites in new regions, facilitating the roll-out of stores quickly, at low cost. On average,
it takes between 2-4 weeks to fit out a new Lovisa store depending on local conditions.
The key driver of future growth for Lovisa is the continued global store roll-out. Lovisa has proven it is capable of successfully
operating profitably globally, having established a portfolio of stores in 46 markets and supporting franchised stores across
13 markets in the Middle East, Africa and South America. Lovisa will continue to explore other markets, with our first stores
opened during the year in company owned markets in China, Vietnam and Ireland, as well as new franchise markets in
Ecuador, Senegal, Guadeloupe and Gabon.
The Group plans to remain nimble and opportunistic in expanding and moving into new markets, such that if opportunities
arise, the Group may accelerate its plans to enter a new market or continue to grow an existing market. Likewise it will defer
its entry into a new market if it considers that appropriate opportunities are not presented at the relevant time.
The history of Lovisa stores is as follows:
2020
2021
2022
2023
2024
Australia
152
153
154
168
178
New Zealand
23
24
25
27
28
Singapore
19
18
17
16
16
South Africa
62
64
69
75
81
Malaysia
27
28
32
41
44
United Kingdom
42
41
42
44
50
Spain
-
-
-
1
2
France (i)
21
52
59
68
86
Germany (ii)
-
38
40
47
53
Belgium (ii)
-
8
11
11
17
Netherlands (ii)
-
6
5
7
9
Austria (ii)
-
3
3
7
9
Luxembourg (ii)
-
2
2
2
2
Switzerland (ii)
-
8
6
9
8
Poland
-
-
1
18
19
USA
48
63
118
190
207
Canada
-
-
1
7
14
Hong Kong
-
-
-
8
9
Taiwan
-
-
-
1
1
Botswana
-
-
-
1
3
Namibia
-
-
-
2
3
Mexico
-
-
-
4
4
Hungary
-
-
-
2
2
Romania
-
-
-
1
1
Italy
-
-
-
7
9
UAE
-
-
-
1
5
China
-
-
-
-
1
Ireland
-
-
-
-
3
Vietnam
-
-
-
-
1
Middle East/Africa Franchise
34
36
44
30
20
South America Franchise
-
-
-
6
15
Vietnam Franchise
7
-
-
-
-
Total
435
544
629
801
900
(i) Of these stores, 22 were acquired as a result of the acquisition of the retail assets of beeline GmbH during 2021
(ii) These stores were acquired as a result of the acquisition of the retail assets of beeline GmbH during 2021
Lovisa Holdings Limited Annual Report - 30 June 2024
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D I R E C T O R S ’ R E P O R T
5.3 Streamline Global Supply Chain
Lovisa’s third party suppliers are currently located in mainland China, India and Thailand. Stock is inspected by Lovisa’s
quality control team in China. Once manufactured, stock is transported to Lovisa’s company operated warehouses in
Melbourne, Australia (for stock to be sold in Australia and New Zealand) or Wroclaw, Poland (for stock to be sold in Europe),
or our 3PL warehouse in Qingdao China (for stock to be sold in all other countries).
Lovisa constantly reviews its supply chain process for potential efficiency gains and cost reductions in order to generate
higher gross margins. This includes improvements in its global warehouse and logistics program and the consolidation and
rationalisation of its supplier base. As a result of this constant review the company has implemented warehouses in the USA,
South Africa (3PL), the UK and Malaysia to better support our online customers in these markets.
5.4 Enhance Existing Store Performance
Lovisa is constantly reviewing the efficiency of its existing store network to ensure that stores are run as profitably as possible,
with stores closed if they are not performing to expectations and new sites continuing to be identified. Whilst some of the
markets Lovisa operates in are mature and have less opportunities for new store openings, our leasing team continues to
assess new sites as they arise. The global roll-out of piercing services into stores has been successful in driving enhanced
customer loyalty and providing new customers an additional reason to choose to shop at Lovisa.
Also critically important in optimising store performance both in new and existing markets is the focus on operational
execution at store level to ensure consistently high operational standards across all markets delivering the best experience for
our customers. To ensure that we deliver on this, we continue to invest in people and localised support structures as well as
enhancing our learning and development capabilities to ensure that we not only have the right team in place but that they
are equipped to operate consistently to the level required.
5.5 Brand Proliferation
Lovisa supports the growth of its brand through social media and promotional activity that matches our customer base and
our international footprint. Efforts are focused on social media, rather than traditional media, as we believe it connects us
directly to our customers in a way that suits their lifestyle.
The brand is also developed through the customer in-store experience – on trend product, cleanly merchandised, focused
imagery, and the store “look and feel”. Stores are located in high foot traffic areas, in high performing centres. The Group’s
online stores and presence on 3rd party marketplaces operate to service the markets in which the Group operates company-
owned stores.
Lovisa Holdings Limited Annual Report - 30 June 2024
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D I R E C T O R S ’ R E P O R T
6. MATERIAL BUSINESS RISKS
The business risks faced by the Group and how it manages
these risks are set out below. Further information surrounding
how the Group monitors, assesses, manages and responds
to risks identified is included within Principle 7 of the
Company’s Corporate Governance statement.
6.1 Competition
The fast fashion jewellery sector in which Lovisa operates is
highly competitive. While the costs and time that would be
required to replicate Lovisa’s business model, design team, IT
systems, global store network, warehouse facilities and level
of brand recognition would be substantial, the industry as a
whole has relatively low barriers to entry. The industry is also
subject to ever changing customer preferences.
Lovisa’s current competitors include:
• specialty retailers selling predominately fashion
jewellery;
• department stores;
• fashion apparel retailers with a fashion jewellery
section; and
• smaller retailers (i.e. less than five stores) that specialise
in the affordable jewellery segment.
Competition is based on a variety of factors including
merchandise selection, price, advertising, new stores, store
location, store appearance, online presence and execution,
product presentation and customer service.
Lovisa’s competitive position may deteriorate as a result of
factors including actions by existing competitors, the entry
of new competitors or a failure by Lovisa to successfully
respond to changes in the industry.
To mitigate this risk, Lovisa employs a large product team
to meet market demands as described in section 5.1.
Management believes it would take a number of years for
a new entrant to establish a portfolio of leases comparable
with Lovisa in premium store locations due to substantial
barrier to entry costs as detailed above.
6.2 Retail Environment and General Economic Conditions
As Lovisa’s products are typically viewed by consumers to
be ‘discretionary’ items rather than ‘necessities’, Lovisa’s
financial performance is sensitive to the current state of, and
future changes in, the retail environment in the countries in
which it operates. However, with a low average retail spend
per transaction, macro market performance is less likely to
have a material impact on our business compared to other
discretionary categories.
Lovisa’s main strategy to overcome any downturn in the retail
environment or economic conditions is to continue to offer
our customers quality, affordable and on trend products.
6.3 Public health crises, political crises and other
catastrophic events outside of our control affect our sales or
supply of inventory
Natural disasters, such as hurricanes, earthquakes, tsunamis,
power shortages or outages, or floods; public health crises,
such as pandemics and epidemics; social unrest; political
crises, such as terrorism, war, political instability or other
conflict; or other events outside of our control, could damage
or destroy our stores or our products, make it difficult for
our employees or customers to travel to our stores, result
in delays or disruptions in the production and/or delivery
of merchandise to our distribution centres or our stores or
in the fulfillment of e-commerce orders to our consumers,
or require us to incur substantial additional costs to ensure
timely delivery.
Moreover, these types of events could negatively impact
consumer spending in the impacted regions or, depending
upon the severity, globally, which could adversely impact our
operating results.
Factors mitigating these risks include the significant
geographical diversity of our operations, continued investment
in e-commerce channels to offset temporary inability to trade
from physical stores, and business continuity plans and
experience developed during the COVID-19 pandemic.
6.4 Failure to Successfully Implement Growth Strategies
Lovisa’s growth strategy is based on its ability to increase
earnings contributions from existing stores and continue to
open and operate new stores on a timely and profitable
basis.
Lovisa’s store roll-out program is dependent on securing
stores in suitable locations on acceptable terms, and may
be impacted by factors including delays, cost overruns and
disputes with landlords.
The following risks apply to the roll-out program:
• new stores opened by Lovisa may be unprofitable;
• Lovisa may be unable to source new stores in preferred
areas, and this could reduce Lovisa’s ability to continue
to expand its store footprint;
• new stores may reduce revenues of existing stores; and
• establishment costs may be greater than budgeted for.
Factors mitigating these risks are that fit-out costs are low with
minimal standard deviation in set-up costs across sites and
territories through our small store format and homogeneous
store layout, minimising potential downside for new stores.
The Group assesses store performance regularly and
evaluates store proximity and likely impact on other Lovisa
stores as part of its roll-out planning.
When entering new markets, Lovisa assesses the region,
which involves building knowledge by leveraging a global
network of industry contacts as well as our significantly
globally experienced senior leadership team, and aims to
secure a portfolio of stores in order to launch an operating
footprint upon entry. The Group plans to remain nimble and
opportunistic in expanding and moving into new markets,
such that if opportunities arise, the Group may accelerate its
plans to enter a new market or continue to grow an existing
market. Likewise it will defer its entry into a new market if it
considers that appropriate opportunities are not presented
at the relevant time. Regular investigation and evaluation of
new stores and territories is undertaken by management to
ensure that the Group’s store footprint continues to expand.
Lovisa Holdings Limited Annual Report - 30 June 2024
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D I R E C T O R S ’ R E P O R T
6.5 Exchange Rates
The majority of inventory purchases made by Lovisa are priced
in USD. Lovisa is exposed to movements in the exchange
rate in the markets it operates in. Adverse movements could
have an adverse impact on Lovisa’s gross profit margin and
overall profitability of non-AUD denominated markets.
The Group’s foreign exchange policy is aimed at managing
its foreign currency exposure in order to protect profit
margins by entering into forward exchange contracts
against movements in currencies required to be converted
to USD associated with payments for inventory. The Group
does not currently hedge its foreign currency earnings. The
Group monitors its working capital in its foreign subsidiaries
to ensure exposure to movements in currency is limited.
6.6 Prevailing Fashions and Consumer Preferences May
Change
Lovisa’s revenues are entirely generated from the retailing of
jewellery and piercing services, which is subject to changes
in prevailing fashions and consumer preferences. Failure to
predict or respond to such changes could adversely impact
the future financial performance of Lovisa. In addition, any
failure by Lovisa to correctly judge customer preferences, or
to convert market trends into appealing product offerings on
a timely basis, may result in lower revenue and margins.
In addition, any unexpected change in prevailing fashions or
customer preferences may lead to Lovisa carrying increased
obsolete inventory.
To mitigate this risk, Lovisa employs an experienced global
product team to meet market demands as described in
section 5.1. As the Group responds to trends as they occur,
this drives store visits by customers and significantly reduces
the risk of obsolete stock.
7. EVENTS SUBSEQUENT TO
REPORTING DATE
No matter or circumstance has arisen since 30 June 2024
that has significantly affected, or may significantly affect:
(a) the Group’s operations in future financial years, or
(b) the results of those operations in future financial years,
or
(c) the Group’s state of affairs in future financial years.
8. LIKELY DEVELOPMENTS
Information on likely developments is contained within the
Review of Operations section of this annual report.
9. REMUNERATION REPORT - AUDITED
9.1 Remuneration Overview
The Board recognises that the performance of the Group
depends on the quality and motivation of its team members
employed by the Group around the world.
The Group remuneration strategy therefore seeks to
appropriately attract, reward and retain team members at
all levels of the business, but in particular for management
and key executives. The Board aims to achieve this by
establishing executive remuneration packages that include
a mix of fixed remuneration, short-term incentives and long-
term incentives.
In performing this responsibility, the Committee must give
appropriate consideration to the Group’s performance and
objectives, employment conditions and external remuneration
relativities in the global market that Lovisa operates in.
Further information surrounding the responsibilities of
the People, Leadership, Remuneration and Nomination
Committee is included within Principle 8 of the Company’s
Corporate Governance statement.
9.2 Principles Used to Determine the Nature and Amount of
Remuneration
Key Management Personnel
Key Management Personnel (KMP) have the authority and
responsibility for planning, directing and controlling the
activities of the consolidated entity, and comprise:
• Non-Executive Directors
• Chief Executive Officer
• Chief Financial Officer
Non-Executive Director KMP
Brett Blundy
Chairman
Tracey Blundy
Director
John Charlton
Director
Sei Jin Alt
Director
Bruce Carter AO
Director
Nico van der Merwe Alternate Director
Executive KMP
Victor Herrero
Chief Executive Officer
Chris Lauder
Chief Financial Officer
This report has been audited by the Company’s Auditor
KPMG as required by Section 308 (3C) of the Corporation
Act 2001.
The People, Leadership, Remuneration and Nomination
Committee is governed by its Charter which was developed
in line with ASX Corporate Governance Principles and
Recommendations. The Charter specifies the purpose,
authority, membership and the activities of the Committee
and the Charter is annually reviewed by the Committee to
ensure it remains consistent with regulatory requirements.
A. Principles Used to Determine the Nature and Amount of
Remuneration
(a) Non-Executive Directors KMP Remuneration
Non-executive Directors’ fees are determined within an
aggregate Non-executive Directors’ pool limit of $800,000.
Total Non-executive Directors’ remuneration including non-
monetary benefits and superannuation paid at the statutory
prescribed rate for the year ended 30 June 2024 was
$598,031. Brett Blundy, the Non-executive Chairman, is
entitled to receive annual fees of $240,000. Other Non-
executive Directors are entitled to receive annual fees
between $77,000 to $97,000 inclusive of superannuation.
The Non-executive Directors’ fees are reviewed annually
to ensure that the fees reflect market rates. There are no
guaranteed annual increases in any Directors’ fees. None
of the non-executive Directors participate in the short or long
term incentives.
(b) Executive remuneration
Lovisa’s remuneration strategy is to:
•
Offer a remuneration structure that will attract, focus,
retain and reward highly capable people;
•
Have a clear and transparent link between
performance and remuneration;
•
Build employee engagement and align management
and shareholder interest; and
•
Ensure executive remuneration is set with regard to
the size and nature of the position with reference
to global market benchmarks (in the context of the
Group operating in a global marketplace) and the
performance of the individual.
Lovisa Holdings Limited Annual Report - 30 June 2024
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D I R E C T O R S ’ R E P O R T
D I R E C T O R S ’ R E P O R T
Senior Executive
Fixed remuneration
At risk remuneration
Victor Herrero
15%
85%
Chris Lauder
54%
46%
Remuneration will incorporate at risk elements to:
•
Link executive reward with the achievement of Lovisa’s business objectives, continued growth and financial
performance; and
•
Ensure total remuneration is competitive by global market standards.
The Board believes that the remuneration structures in place for the executive team, and in particular the Chief Executive
Officer, Victor Herrero are appropriate. The Board were therefore disappointed to receive votes against the Remuneration
Report at the 2023 Annual General Meeting totalling 73.4% of votes cast.
Lovisa is a global business competing for talent in the global market with significant global growth potential, which requires
compensation packages competitive in this context to attract and retain the appropriate calibre of executive to deliver the
Group’s strategy and growth targets.
Whilst the Board understands the concerns of some shareholders in relation to the potential remuneration payable, it is of the
view that the structure and at risk remuneration in place for the leadership of the Group is appropriate.
As announced by the Company on 3 June 2024, the Company’s current Chief Executive Officer, Victor Herrero, will leave
the company on 31 May 2025, and John Cheston has been appointed to the Chief Executive Officer role and will commence
in the role on 4 June 2025. The Board have taken the opportunity as part of this change to review the remuneration package
structure in place for both Victor (in relation to the 2025 financial year) and John (upon his commencement), with the
following remuneration packages in place respectively:
•
Victor Herrero’s fixed cash remuneration will remain at US$1,300,000 per annum for the remainder of his tenure, and
he will not be entitled to any further short or long term incentives other than those already in place and vesting in August
2024 as set out in this report
•
John Cheston’s remuneration package will comprise the following components from his commencement in June 2025:
o
Fixed Remuneration of A$2,350,000 per annum;
o
Short-term Incentive Opportunity of A$2,350,000 per annum vesting on a straight-line basis subject to the following
performance hurdles:
-
EBIT Growth <18.5%: Nil
-
EBIT Growth 18.5%: $188,000
-
EBIT Growth 30% or greater: $2,350,000
o
Subject to shareholder approval, John shall be eligible to participate in the Group’s Long Term Incentive Plan (LTI)
as amended and restated from time to time. He will be entitled to an initial 3-year LTI Grant vesting annually over
its 3 year term to a maximum value of A$2,350,000 per annum, based on the following vesting schedule:
-
FY26: A$2,350,000
-
FY27: A$2,350,000
-
FY28: A$2,350,000
-
TOTAL: A$7,050,000
o
Vested LTI will be satisfied by the issue of Rights over ordinary shares in the Company, that will be subject to a
2-year holding lock during which time they will be entitled to receipt of dividends from the company by way of
an equivalent cash payment. At the end of the 2-year holding lock they are convertible to ordinary shares for nil
consideration at any time within the following 10 year period.
o
For each Performance Period, the number of Rights to be granted will be calculated by dividing the value of the
applicable vested LTI Opportunity (following testing against the performance hurdle) by the 30 calendar-day
volume-weighted average price (VWAP) of a Share for the period up to and including 30 June of the relevant
Performance Period.
o
The performance hurdles for each year will be based on EBIT growth over the EBIT performance of the financial
year immediately prior for each year as follows:
-
EBIT Growth <18.5%: Nil
-
EBIT Growth 18.5%: A$188,000
-
EBIT Growth 30% or greater: A$2,350,000
o
Calculation of the EBIT Hurdle and achievement against the EBIT Hurdle will be determined by the Board (or a
committee of the Board) in its reasonable good faith discretion, having regard to any matters that it considers
relevant.
B. Remuneration Structure
The current executive salary and reward framework consists of the following components:
•
Base salary and benefits including superannuation
•
Short-term incentive scheme comprising cash
•
Long-term incentive scheme comprising cash and options or performance rights
The mix, quantum, terms and conditions associated with each of these components is determined annually by the Board using
their discretion for each individual executive.
The mix of fixed and at risk components for each Senior Executive as a percentage of total actual remuneration for the 2024
financial year is as follows:
Lovisa Holdings Limited Annual Report - 30 June 2024
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D I R E C T O R S ’ R E P O R T
The STI plan structure in place for FY24 was as follows:
KMP
Opportunity
Performance
Period
Performance Measures
FY24
Outcome
Victor Herrero
Chief Executive Officer
nil
n/a
n/a
n/a
Chris Lauder
Chief Financial Officer
$341,250
12 months,
subject to
continued
employment
until the date of
payment
Discretionary based on the Board’s assessment of performance with
reference to the following KPI:
Delivery of 18% growth in EBIT on FY23 to $125m in FY24 (actual
outcome 21% growth)
Delivery of 20% growth in Total Sales on FY23 to $715m in FY24
(actual outcome 17% growth)
Delivery of cost of doing business as a % to sales lower than FY23
(actual outcome - 0.6% to sales)
Stock at cost per store (on a constant currency basis) equal to or
below LY (actual outcome achieved)
70%
Victor Herrero, Chief Executive Officer was not eligible to participate in the annual STI program, with his at-risk remuneration
comprised entirely of his LTI.
The award of 70% of the Chief Financial Officer’s STI was based on the Board’s assessment of his performance against the
criteria noted above, and therefore $238,875 of the STI opportunity of $341,250 to be paid.
Long Term Incentive plan
The Company operates a long-term incentive (LTI) plan. The plan is designed to align the interests of the executives with the
interest of the shareholders by providing an opportunity for the executives to receive an equity interest in Lovisa and in some
cases a cash payment. The plan provides flexibility for the Company to grant performance rights and options as incentives,
subject to the terms of the individual offers and the satisfaction of performance conditions determined by the Board from time
to time.
The key terms associated with the LTI plan are:
•
A Performance Option or Right entitles the holder to acquire a share upon payment of an applicable exercise price
at the end of the performance period, subject to meeting specific performance conditions (for Performance Rights, the
exercise price is nil).
•
Options will be granted for nil consideration.
Performance Conditions
The Board considers profit based performance measures such as EPS and EBIT to be the most appropriate performance
conditions as they align the interests of shareholders with management.
9.2 Principles Used to Determine the Nature and Amount of Remuneration (continued)
B. Remuneration Structure (continued)
FY2022 Chief Executive Officer LTI Plan
Following his appointment as Chief Executive Officer of the Group in November 2021, Victor Herrero was granted a
3-year LTI Grant on 23 November 2021 (Grant Date) vesting annually over its 3 year term including a Cash Award and a
Performance Rights component, with the number of Performance Rights to be granted under the award determined at the date
set out in the table below (Determination Date). The table below sets out the maximum LTI opportunity for each performance
period, split between a Cash Award and Performance Rights. The number of Performance Rights to be granted to Victor is
determined on the Determination Dates specified below by dividing the grant value by the 30-day volume weighted average
price (VWAP) of the Company’s Shares at the relevant Determination Date specified below (Fair Value).
Tranche
End of
Performance
Period
Date number
of Performance
Rights determined
(Determination Date)
Maximum Value of
Performance Rights
to be Granted
(AUD)
Maximum
Cash Award
Opportunity
(AUD)
Total Maximum
LTI Opportunity
(AUD)
Number of
Performance
Rights Granted at
Determination Date
Tranche 1
3 July 2022
23 November 2021
8,400,000
3,600,000
12,000,000
400,000
Tranche 2
2 July 2023
4 July 2022
24,400,000
3,600,000
28,000,000
1,742,857
Tranche 3
30 June 2024
3 July 2023
24,400,000
3,600,000
28,000,000
1,242,995
Base Salary and Benefits
Base pay is structured as a total employment cost package which may be delivered as a combination of cash and non-cash
benefits. Retirement benefits are delivered to the employee’s choice of superannuation fund where relevant. The Group has
no interest or ongoing liability to the fund or the employee in respect of retirement benefits.
Short Term Incentive plan
The Group operates a short-term incentive (STI) plan that rewards some Executives and Management on the achievement of
pre-determined key performance indicators (KPIs) established for each financial year according to the accountabilities of his/
her role and its impact on the organisation’s performance. KPIs include company profit targets and personal performance
criteria. Using a profit target ensures variable reward is paid only when value is created for shareholders.
Lovisa Holdings Limited Annual Report - 30 June 2024
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D I R E C T O R S ’ R E P O R T
D I R E C T O R S ’ R E P O R T
The performance hurdles for each LTI tranche are set out below, with performance against the EBIT hurdles to be tested
at the end of each Performance Period and based on EBIT before the share-based payments expense recognised in the
period associated with the LTI grants made to the CEO as set out above. Actual EBIT (before CEO’s LTI) outcomes between
hurdles will result in a pro-rata vesting of the cash and rights.
Tranche
EBIT Hurdle
(pre LTI) (A$m)
Cash Award Amount
(A$m)
Value of Performance
Rights that Vest (based
on value per right at
Grant Date) ($Am)
Total LTI Award value
(based on value of
Performance Rights at
Grant Date) ($Am)
Tranche 1 (vesting based on performance against
EBIT Hurdle for FY22)
less than 65.0
0.0
0.0
0.0
65.0
1.5
1.5
3.0
70.0
1.75
1.75
3.5
80.0
2.5
2.5
5.0
95.0
3.6
5.4
9.0
105+
3.6
8.4
12.0
Tranche 2 (vesting based on performance against
EBIT Hurdle for FY23)
less than 90.0
0.0
0.0
0.0
90.0
1.0
1.0
2.0
95.0
1.5
1.5
3.0
100.0
2.5
2.5
5.0
110.0
3.6
4.4
8.0
115.0
3.6
8.4
12.0
120.0
3.6
14.4
18.0
130+
3.6
24.4
28.0
Tranche 3 (vesting based on performance against
EBIT Hurdle for FY24)
less than 95.0
0.0
0.0
0.0
95.0
2.0
2.0
4.0
100.0
3.0
3.0
6.0
110.0
3.6
5.4
9.0
125.0
3.6
10.4
14.0
140.0
3.6
18.4
22.0
155+
3.6
24.4
28.0
Calculation of the EBIT Hurdle and achievement against the EBIT Hurdle has been determined by the Board (or a committee
of the Board) in its reasonable good faith discretion, having regard to any matters that it considered relevant. The number of
Performance Rights that vest is calculated by dividing the value of the Performance Rights that vest as specified above by the
Fair Value of each Performance Right for that Tranche as calculated at the Determination Date.
Upon Vesting of the Performance Rights and conversion to shares, the shares will be subject to a 12-month holding restriction
period (this does not apply to the Cash component).
The actual vesting outcome for the Tranche 3 Performance Rights described above was determined by the Board based on
the financial performance for the 2024 financial year, Tranche 2 based on the 2023 financial year, and Tranche 1 based
on the 2022 financial year, as follows:
Tranche
Performance Outcome
(EBIT pre share-based
payments expense)
% of total
opportunity
vested
Total LTI
Opportunity
($)
LTI Vested ($)
Vested LTI Cash
($)
Vested LTI –
Performance
Rights ($)
Vested
Performance
Rights
(Number)
Tranche 1
$101.3m
90.80%
$12,000,000
$10,901,100
$3,600,000
$7,301,100
347,671
Tranche 2
$132.8m
92.80%
$28,000,000
$26,000,000
$1,600,000
$24,400,000
1,742,857
Tranche 3
$140.1m
78.76%
$28,000,000
$22,053,083
$3,600,000
$18,453,083
940,045
The vesting % of Tranche 2 noted above reflects the agreed vesting outcome between the Board and Mr Herrero, with the
actual vesting % based on the EBIT outcome equal to 100% then reduced to the 92.8% vesting noted above by mutual
agreement.
The Fair Value of each Performance Right for the purpose of determining the number of Performance Rights granted under
Tranche 1 above was $21.00, $14.00 for Tranche 2, and $19.63 for Tranche 3. The grant of the Chief Executive Officer LTI
Plan noted above was approved by shareholders at the 2021 Annual General Meeting, including the 400,000 Performance
Rights granted on 23 November 2021 the 1,742,857 Performance Rights granted on 4 July 2022, and the 1,242,995
Performance Rights granted on 3 July 2023.
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 27
D I R E C T O R S ’ R E P O R T
For the Performance Rights and Cash Award to Vest, the Group needs to meet or exceed the following performance hurdles
based on the Group’s Earnings Before Interest and Tax for the FY24 financial year and continued employment with the Group
as follows:
Tranche
End of Performance Period
Primary Performance Hurdle
Secondary Performance Hurdle
Tranche 1
30 June 2024
Growth in Company EBIT for FY24
of between 17.5% (20% vesting)
to 30% (100% vesting) over FY23
(FY24 EBIT Hurdle)
Continued employment at the
vesting date
Tranche 2
29 June 2025
Growth in Company EBIT for FY24
of between 17.5% (20% vesting)
to 30% (100% vesting) over FY23
(FY24 EBIT Hurdle)
Continued employment at the
vesting date
Tranche 3
28 June 2026
Growth in Company EBIT for FY24
of between 17.5% (20% vesting)
to 30% (100% vesting) over FY23
(FY24 EBIT Hurdle)
Continued employment at the
vesting date
The FY24 EBIT Hurdle is calculated based on growth on FY23 Statutory EBIT. Once the FY24 EBIT Hurdle performance has
been determined and the resulting vesting percentage determined for Tranche 1, this vesting percentage will also be applied
to Tranche 2 and 3 assuming continued employment at the vesting date for each of those tranches.
The actual EBIT for the financial year ended 30 June 2024 was $128.2m, representing growth of 21.2% on FY23. As a
result, subsequent to the end of the financial year the Board have determined that 43.8% of the LTI Award granted under
Tranche 1 has vested, with an equivalent vesting percentage to be applied to the subsequent tranches and those LTI Awards
also vesting should each executive remain employed at the subsequent vesting dates.
FY2024 Executive LTI Plan
On 6 September 2023 an LTI Award was made to certain Executives as part of the FY2024 LTI, comprising Performance
Rights and a Cash component. The key terms associated with the FY2024 Executive LTI Grant are:
•
The performance period commences 3 July 2023 and ends 28 June 2026, with the LTI Award vesting evenly over the
3 year period.
•
Upon Vesting of the Performance Rights and conversion to shares, the shares will be subject to a 12-month holding
restriction period (this does not apply to the Cash component).
•
A total of 34,170 Performance Rights were granted, based on a total grant value of $670,758 divided by the 30
day VWAP of the Company’s Shares to the date of grant of $19.63. The LTI Award also included a Cash component
totalling $670,758, with the total LTI Award value $1,341,516. The cash component is paid out annually at equal
tranches over the 3 year period.
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 28
D I R E C T O R S ’ R E P O R T
For the Performance Rights and Cash Award to Vest, the Group needed to meet or exceed the following performance hurdles
based on the Group’s Earnings Before Interest and Tax for the FY23 financial year and continued employment with the Group
as follows:
Tranche
End of Performance Period
Primary Performance Hurdle
Secondary Performance Hurdle
Tranche 1
2 July 2023
Growth in Company EBIT for FY23
of between 17.5% (20% vesting)
to 30% (100% vesting) over FY22
(FY23 EBIT Hurdle)
Continued employment at the
vesting date
Tranche 2
30 June 2024
Growth in Company EBIT for FY23
of between 17.5% (20% vesting)
to 30% (100% vesting) over FY22
(FY23 EBIT Hurdle)
Continued employment at the
vesting date
Tranche 3
29 June 2025
Growth in Company EBIT for FY23
of between 17.5% (20% vesting)
to 30% (100% vesting) over FY22
(FY23 EBIT Hurdle)
Continued employment at the
vesting date
The FY23 EBIT Hurdle was calculated based on growth on FY22 Statutory EBIT adjusted to remove the 53rd week of
trading in FY22 to ensure comparability between periods. The actual EBIT for the financial year ended 2 July 2023 was
$105.7m, representing growth of 31.5% on FY22 (on a 52 week basis). As a result, subsequent to the end of the 2023
financial year the Board determined that 100% of the LTI Award granted under Tranche 1 had vested, with an equivalent
vesting percentage to be applied to the subsequent tranches and those LTI Awards also vesting should each executive remain
employed at the subsequent vesting dates. As a result, 17,919 Tranche 1 rights vested and were converted to shares for the
relevant executives during FY24, with cash LTI payments made totalling $250,882.
Each executive entitled to Tranche 2 above remained employed with the Company at 30 June 2024 and therefore at that
date a further 17,919 rights vested and were issued to executives subsequent to financial year end, with the Tranche 2 cash
LTI payment also made subsequent to financial year end totalling $250,882.
FY2023 Executive LTI Plan
On 29 August 2022 an LTI Award was made to certain Executives as part of the FY2023 LTI, comprising Performance Rights
and a Cash component. The key terms associated with the FY2023 Executive LTI Grant are:
•
The performance period commences 4 July 2022 and ends 29 June 2025, with the LTI Award vesting evenly over the
3 year period.
•
Upon Vesting of the Performance Rights and conversion to shares, the shares will be subject to a 12-month holding
restriction period (this does not apply to the Cash component).
•
A total of 53,757 Performance Rights were granted, based on a total grant value of $752,645 divided by the 30
day VWAP of the Company’s Shares to the date of grant of $14.00. The LTI Award also included a Cash component
totalling $752,645, with the total LTI Award value $1,505,290. The cash component is paid out annually at equal
tranches over the 3 year period.
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 29
D I R E C T O R S ’ R E P O R T
FY2022 Executive LTI Plan
In September 2021 a grant of Performance Options was made to certain Executives as part of the FY2022 LTI. The key terms
associated with the FY2022 Executive LTI Grant are:
•
The performance period commences 28 June 2021 and ends 30 June 2024.
•
The exercise price of the Performance Options is $14.37, which represents the 30 day VWAP to the date of grant.
•
A total of 150,000 Performance Options were granted.
•
The grant of Performance Options is subject to performance conditions based on delivering the Group’s EBIT target
over the performance period, as set out below.
•
The expiry of the Performance Options is 12 months following the end of the performance period.
•
90,000 options were forfeited during a prior year.
The Board determined the EBIT Target growth hurdles applicable to the FY2022 grant is as follows:
Group’s EBIT for the financial year ending 30 June 2024
% of LTI Options that vest and become exercisable
Less than $90m
Nil
$90m - $95m
20% awarded
$95m - $100m
35% awarded
$100m - $110m
50% awarded
$110m - $120m
75% awarded
>$120m
100% awarded
The actual EBIT for the financial year ended 30 June 2024 was $128.2m. As a result, subsequent to the end of the financial
year the Board have determined that 60,000 of the Performance Options with a value of $479,404 granted under this
tranche have vested.
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 30
D I R E C T O R S ’ R E P O R T
9.3 Equity Remuneration Analysis
Analysis of Options and Performance Rights over Equity Instruments Granted as Compensation
Details of the vesting profile of options and performance rights awarded as remuneration to each key management person
are detailed below.
Performance Rights/Options granted
Grant date
Included in
Remuneration
for the
current year
$
%
vested
in the
period
%
forfeited
in the
period
Financial
period in
which grant
vests
Maximum
Value yet
to vest (iii)
Number
Value
$
Performance
period
commences
V Herrero
FY22 LTIP Tranche 2
(FY23 vesting)(i)
1,742,857
24,400,000
4 Jul 2022
23 Nov 2021
2,255,788
100%
-
30 Jun 2024
-
FY22 LTIP Tranche 3
(FY24 vesting)(i)
1,242,995
24,400,000
3 Jul 2023
23 Nov 2021
8,041,170
(iv)
-
29 Jun 2025
1,127,183
C Lauder
FY21 LTIP
100,000
289,100
29-Jun-20
16-Oct-20
41,300
100%
-
30-Jun-24
N/A
FY22 LTIP
60,000
479,404
28-Jun-21
25-Aug-21
136,526
(iv)
-
29-Jun-25
N/A
FY23 LTIP Tranche 1
(FY23 vesting)(ii)
3,869
54,167
4-Jul-22
29-Aug-22
7,683
100%
-
30-Jun-24
-
FY23 LTIP Tranche 2
(FY24 vesting)(ii)
3,869
54,167
4-Jul-22
29-Aug-22
24,989
100%
-
30-Jun-24
-
FY23 LTIP Tranche 3
(FY25 vesting)(ii)
3,869
54,167
4-Jul-22
29-Aug-22
17,085
-
-
29-Jun-25
20,043
FY24 LTIP Tranche 1
(FY24 vesting)(ii)
2,897
62,090
3-Jul-23
6-Sep-23
23,227
(v)
(v)
29-Jun-25
3,967
FY24 LTIP Tranche 2
(FY25 vesting)(ii)
2,897
62,090
3-Jul-23
6-Sep-23
12,495
-
-
29-Jun-25
14,699
FY24 LTIP Tranche 3
(FY26 vesting)(ii)
2,897
62,090
3-Jul-23
6-Sep-23
8,549
-
-
28-Jun-26
18,647
(i) During FY22, Mr Herrero was granted long term incentives as set out at 9.2 above, including performance rights vesting over the financial years 2022, 2023 and 2024.
Whilst the value of the performance rights were granted as at November 2021, the number of performance rights granted under each tranche of the grant has been determined
at the start of each performance period, with tranche 1 determined at 23 November 2021, tranche 2 determined on 4 July 2022, and tranche 3 determined on 3 July 2023
based on the 30 day VWAP of Lovisa shares at that date. The total potential value of the long term incentive at inception across the 3 year term was $68 million, including
$57.2 million performance rights (as set out above) and $10.8m in cash settled incentives.
(ii) During FY23, Mr Lauder was granted an LTI Award comprising 3 Tranches vesting over the period FY23 to FY25, to a total value of $325,000, comprising Performance
Rights granted across the 3 tranches totalling $162,500 resulting in the grant of a total of 11,607 Performance Rights, and a cash component also totalling $162,500.
During FY24, Mr Lauder was granted an LTI Award comprising 3 Tranches vesting over the period FY24 to FY26, to a total value of $341,250 at calculation date, comprising
Performance Rights granted across the 3 tranches based on an allocation at calculation date of $170,625 resulting in the grant of a total of 8,692 Performance Rights (with a
fair value at grant date of $186,271), and a cash component totalling $170,625.
(iii) The maximum value of performance rights yet to vest is determined based on the amount of the grant date fair value that is yet to be expensed. The minimum value of share
rights yet to vest is nil since the shares will be forfeited if the vesting conditions are not met.
(iv) Vesting of rights and options is known at the date of this report for these tranches, as detailed elsewhere in this report.
(v) 43.8% vesting of these rights is known at the date of this report.
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 31
D I R E C T O R S ’ R E P O R T
The value of performance rights or options granted or exercised by each key management person during the financial year
is detailed below:
Key Management Person
Granted in year $(i)
No. of shares issued
on exercise
Value of rights or
options exercised in
year $(ii)
Exercise price of
Options Exercised
during the year
V Herrero
-
1,742,857
37,349,429
N/A
C Lauder
186,270
103,869
1,510,913
7.15
(i) The value of performance rights granted in the year is the fair value of the performance rights calculated at grant date. The total value of the performance rights granted is
included in the table above. This amount is allocated to remuneration over the vesting period.
(ii) The value of options exercised during the year is calculated as the market price of shares of the Company as at close of trading on the date the options were exercised
after deducting the price paid to exercise the option.
9.4 Options and Performance Rights Over Equity Instruments
The movement during the reporting period in the number of performance rights and options over ordinary shares in Lovisa
Holdings Limited held directly or beneficially, by each key management person, including their related parties, is as follows:
Key Management Person
Held at 3
July 2023
Granted
Exercised
Forfeited
Held at 30
June 2024
Vested during
the year
Vested and
exercisable at
30 June 2024
Directors
V Herrero
- FY22 LTIP (Tranche 2)
1,742,857
-
(1,742,857)
-
-
100%
-
- FY22 LTIP (Tranche 3)
-
1,242,995
-
-
1,242,995
-
(i)
Executives
C Lauder
- FY21 LTIP
100,000
-
(100,000)
-
-
100%
-
- FY22 LTIP
60,000
-
-
-
60,000
-
(ii)
- FY23 LTIP (Tranche 1)
3,869
-
(3,869)
-
-
100%
-
- FY23 LTIP (Tranche 2)
3,869
-
-
-
3,869
100%
3,869
- FY23 LTIP (Tranche 3)
3,869
-
-
-
3,869
-
-
- FY24 LTIP (Tranche 1)
-
2,897
-
-
2,897
-
(iii)
- FY24 LTIP (Tranche 2)
-
2,897
-
-
2,897
-
(iii)
- FY24 LTIP (Tranche 3)
-
2,898
-
-
2,898
-
(iii)
(i) 78.76% vesting of rights and options is known at the date of this report.
(ii) 100% vesting of options is known at the date of this report.
(iii) 43.8% vesting of Tranche 1 rights is known at the date of this report, with the remaining 56.2% of each of Tranche 1, 2 and 3 of the FY24 LTI therefore forfeited and the
future vesting of the remaining 43.8% of Tranche 2 and 3 subject to continued employment as set out above.
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 32
D I R E C T O R S ’ R E P O R T
(1) Victor Herrero was appointed as a Director of the Company on 14 October 2021 and commenced as Chief Executive Officer on
9 November 2021. Included in Other Monetary Benefits is remuneration related to car allowance and reimbursement of personal
costs related to life insurance and tax advice. Mr Herrero’s LTI award described above includes both cash and equity settled
components subject to performance conditions over the performance periods ending 3 July 2022, 2 July 2023 and 30 June 2024,
with the associated expense recognised over the relevant performance period.
(2) Chris Lauder was granted a cash retention incentive of $300,000 in March 2022 payable in August 2023 based on continued
employment at that date, with the associated expense included in remuneration over that period in the table above.
(3) Resigned 18 November 2022.
9.5 Details of Remuneration
Details of the remuneration of the Directors and Key Management Personnel (KMPs) is set out below.
Year
Short Term Employment Benefits
Post-Employment
Benefits
Long Term Benefits
Share Based
Payments
Salary &
Fees ($)
Other
monetary
benefits ($)
Performance
based payment
($)
Super
Contributions ($)
Annual &
Long Service
Leave ($)
Performance
based
payment ($)
Options /
Rights ($)
Total ($)
NON-EXEC DIRECTORS
B Blundy
2024
240,000
-
-
-
-
-
-
240,000
2023
150,000
-
-
-
-
-
-
150,000
T Blundy
2024
87,387
-
-
9,629
-
-
-
97,016
2023
73,059
-
-
7,685
-
-
-
80,744
B Carter
2024
97,000
-
-
-
-
-
-
97,000
2023
44,955
-
-
4,734
-
-
-
49,689
J Charlton
2024
78,378
-
-
8,637
-
-
-
87,015
2023
73,059
-
-
7,685
-
-
-
80,744
S J Alt
2024
77,000
-
-
-
-
-
-
77,000
2023
70,000
-
-
-
-
-
-
70,000
J King (3)
2024
-
-
-
-
-
-
-
-
2023
28,100
-
-
2,950
-
-
-
31,050
N van der
Merwe
2024
-
-
-
-
-
-
-
-
2023
-
-
-
-
-
-
-
-
TOTAL
NON-EXEC
DIRECTORS
2024
579,765
-
-
18,266
-
-
-
598,031
2023
439,713
-
-
23,054
-
-
-
462,227
EXEC DIRECTORS
V Herrero (1)
2024
1,982,158
70,748
-
-
-
1,623,854
10,296,948
13,973,708
2023
1,908,225
62,940
-
-
88,314
2,058,028
24,975,099
29,092,606
OTHER KMP
C Lauder (2)
2024
617,375
-
238,875
27,577
61,942
90,309
271,854
1,307,932
2023
568,281
-
260,000
25,292
64,701
321,776
439,222
1,679,272
TOTAL EXEC
2024
2,599,533
70,748
238,875
27,577
61,942
1,714,163
10,568,802
15,281,640
2023
2,476,506
62,940
260,000
25,292
153,015
2,379,804
25,414,321
30,771,878
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 33
D I R E C T O R S ’ R E P O R T
9.6 Details of KMP Employment Contracts
The remuneration and other terms of employment of the CEO and CFO are set out in individual employment contracts.
Victor Herrero’s existing employment contract with the Company was amended on 1 June 2024 to include a fixed term
ending on 31 May 2025. Chris Lauder’s employment contract is not subject to a fixed term. Notice periods under these
employment contracts are as follows:
Name
Notice period/termination payment
Victor Herrero
The Company may terminate the employment contract immediately for “Cause”, and Victor can terminate the
employment contract immediately for “Good Reason”, each by providing written notice to the other subject to
relevant cure periods in each circumstance. Termination for “Cause” includes serious misconduct, wilful and
continuous failure to perform duties, and material breach of the employment contract, for “Good Reason”
includes material breach of the employment contract and customary change of control provisions.
Where Victor’s employment is terminated for Cause by the Company, no termination benefits are payable.
Where Victor’s employment is terminated by Victor for good reason, he may be eligible for a termination
payment equal to the base salary of the remaining term of the contract, subject to a minimum payment of 3
months base salary.
Chris Lauder
6 months’ notice by either party (or payment in lieu). Where Mr Lauder’s employment is terminated due to
serious misconduct or gross negligence, Mr Lauder’s employment may be terminated immediately without any
pay in lieu and the stated notice period will not apply.
9.7 Consequences of Performance on Shareholder Wealth
In considering the consolidated entity’s performance and the benefits for shareholder wealth, the People, Remuneration and
Nomination Committee has regard to a range of indicators in respect of senior executive remuneration and linked these to
the previously described short and long term incentives.
The following table presents these indicators showing the impact of the Group’s performance on shareholder wealth, during
the financial years:
2024
2023
2022
2021
2020
Earnings before interest and tax ($000)
128,177
105,742
82,684
43,527
25,667
Net profit after tax ($000)
82,411
68,164
58,387
24,829
11,221
Dividends paid
88,851
80,874
59,103
37,611
15,866
Share Price
$32.87
$19.30
$14.26
$14.45
$8.08
Earnings per share
75.4
63.3
54.3
23.1
10.6
KMP Shareholdings
The following table details the ordinary shareholdings and the movements in the shareholdings of KMP (including their
personally related entities) for the financial year ended 30 June 2024.
No. of shares
Held at
3 July 2023
Shares
Purchased
Shares
Purchased from
Options and
Rights
Shares
Sold
Other
Movements
Held at
30 June 2024
Non-executive Directors
B Blundy
43,207,500
-
-
-
-
43,207,500
T Blundy
1,153,005
-
-
-
-
1,153,005
B Carter
15,000
-
-
-
-
15,000
J Charlton
29,000
-
-
-
-
29,000
S J Alt
-
-
-
-
-
-
N van der Merwe (alternate)
-
-
-
-
-
-
Executive Directors
V Herrero
397,471
-
1,742,857
-
-
2,140,328
Executive
C Lauder
27,546
-
103,869
(15,000)
-
116,415
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 34
D I R E C T O R S ’ R E P O R T
10. INSURANCE OF OFFICERS AND
INDEMNITIES
During the financial year, Lovisa Holdings Limited paid a
premium of $430,300 (2023: $480,000) to insure the
Directors and officers of the Group.
The liabilities insured are costs and expenses that may be
incurred in defending civil or criminal proceedings that may
be brought against the officers in their capacity as officers
of the Group, and any other payments arising from liabilities
incurred by the officers in connection with such proceedings,
other than where such liabilities arise out of conduct involving
a wilful breach of duty by the officers or the improper use
by the officers of their position or of information to gain
advantage for themselves or someone else or to cause
detriment to the Group.
11. AUDIT SERVICES
11.1 Auditors Independence Declaration
A copy of the auditor’s independence declaration as required
under section 307C of the Corporations Act 2001 is set out
on page 92 and forms part of this Directors’ Report.
11.2 Audit and Non-Audit Services Provided by the
External Auditor
During the financial year ended 30 June 2024 the following
fees were paid or were due and payable for services
provided by the external auditor, KPMG, of the Consolidated
Entity:
Consolidated Entity
2024
$000
2023
$000
Audit and assurance services
Audit and review of financial
statements
990
674
Other services
Tax compliance services
354
377
Other accounting services
36
141
1,380
1,192
The Group may decide to employ the auditor on assignments
additional to their statutory audit duties where the auditor’s
expertise and experience with the Group are important.
The Board of Directors has considered the position and, in
accordance with advice received from the Audit, Business
Risk and Compliance Committee, is satisfied that the
provision of the non-audit services is compatible with the
general standard of independence for auditors imposed by
the Corporations Act 2001. The Directors are satisfied that
the provision of non-audit services by the auditor did not
compromise the auditor independence requirements of the
Corporations Act 2001 for the following reasons:
• all non-audit services have been reviewed by the Audit,
Business Risk and Compliance Committee to ensure
they do not impact the impartiality 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.
12. PROCEEDINGS ON BEHALF OF
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.
No proceedings have been brought or intervened in on
behalf of the Company with leave of the Court under section
237 of the Corporations Act 2001.
13. ENVIRONMENTAL REGULATION
The Company’s operations are not subject to any significant
environmental regulations under either Commonwealth or
State legislation. However, the Directors believe that the
Company has adequate systems in place for the management
of its environmental requirements and is not aware of any
breach of these environmental requirements as they apply
to the entity.
14. NON-IFRS FINANCIAL
INFORMATION
This report contains certain non-IFRS financial measures of
historical financial performance. The measures are used by
management and the Directors for the purpose of assessing
the financial performance of the Group and individual
segments. The measures are also used to enhance the
comparability of information between reporting periods
by adjusting for non-recurring or controllable factors which
affect IFRS measures, to aid the user in understanding the
Group’s performance. These measures are not subject to
audit.
15. ROUNDING OF AMOUNTS
The Group is of a kind referred to in ASIC Corporations
(Rounding
in
Financial/Directors’
Reports)
Instrument
2016/191 issued by the Australian Securities and Investments
Commission, relating to the ‘rounding off’ of amounts in the
Directors’ report. Amounts in the Directors’ Report have been
rounded off in accordance with that Instrument to the nearest
thousand dollars, or in certain cases, to the nearest dollar.
Signed in accordance with a resolution of the Directors
Brett Blundy
Non-Executive Chairman
Victor Herrero
Chief Executive Officer
Melbourne, 26 August 2024
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 35
C O N T E N T S
F I N A N C I A L S T A T E M E N T S
Consolidated statement of financial position
37
Consolidated statement of profit or loss and
other comprehensive income
38
Consolidated statement of changes in equity
39
Consolidated statement of cash flows
40
N O T E S T O T H E C O N S O L I D A T E D
F I N A N C I A L S T A T E M E N T S
Setting the scene
41
Business performance
43
A1 Operating segments
43
A2 Revenue
44
A3 Expenses
45
A4 Impairment
46
A5 Earnings per share
46
A6 Dividends
47
A7 Income taxes
47
Asset platform
50
B1 Trade and other receivables
50
B2 Inventories
50
B3 Property, plant and equipment
50
B4 Right-of-use asset
52
B5 Intangible assets and goodwill
53
B6 Impairment of property, plant and equipment
& intangible assets and goodwill
54
B7 Trade and other payables
55
B8 Provisions
55
B9 Employee benefits
56
B10 Lease liabilities
57
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 36
N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L
S T A T E M E N T S C O N T I N U E D
Risk and capital management
58
C1 Capital and reserves
58
C2 Capital management
59
C3 Loans and borrowings
60
C4 Financial instruments –
Fair values and risk management
61
C5 Cash flows
67
Other information
69
D1 List of subsidiaries
69
D2 Commitments and contingencies
70
D3 Share-based payment arrangements
71
D4 Related parties
75
D5 Auditors’ remuneration
76
D6 Deed of cross guarantee
77
D7 Parent entity disclosures
79
D8 New standards and interpretations
adopted by the group
80
D9 New standards and interpretations
not yet adopted
80
C O N S O L I D A T E D E N T I T Y D I S C L O S U R E
S T A T E M E N T
Consolidated entity disclosure statement
83
Signed Reports
Directors’ declaration
87
Independent auditor’s report
88
Lead auditor’s independence declaration
93
ASX Information
Shareholder Information
97
Corporate Directory
103
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 37
F I N A N C I A L S T A T E M E N T S
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2024
The Notes on pages 41 to 80 are an integral part of these consolidated financial statements.
Note
30 June
2 July
Consolidated ($000s)
2024
2023
Assets
Cash and cash equivalents
C5
30,520
31,650
Trade and other receivables
B1
19,445
23,202
Current tax receivables
11,521
210
Inventories
B2
68,622
60,098
Derivatives
C4
-
915
Total current assets
130,108
116,075
Deferred tax assets
A7
23,285
20,924
Property, plant and equipment
B3
123,588
121,389
Right-of-use asset
B4
251,399
255,741
Intangible assets and goodwill
B5
4,419
4,274
Total non-current assets
402,691
402,328
Total assets
532,799
518,403
Liabilities
Trade and other payables
B7
61,140
39,677
Employee benefits - current
B9
9,180
7,667
Provisions - current
B8
2,522
2,413
Lease liability - current
B10
58,406
57,606
Derivatives
C4
318
-
Current tax liabilities
8,271
7,870
Total current liabilities
139,837
115,233
Employee benefits - non current
B9
432
339
Lease liability - non current
B10
246,661
249,981
Provisions - non current
B8
8,832
7,861
Deferred tax liabilities
A7
2,751
-
Loans and borrowings - non current
C3
54,000
65,000
Total non-current liabilities
312,676
328,131
Total liabilities
452,513
438,414
Net assets
80,286
79,989
Equity
Issued capital
C1
214,852
214,137
Common control reserve
(208,906)
(208,906)
Other reserves
20,240
43,524
Retained earnings
54,100
31,234
Total equity
80,286
79,989
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 38
F I N A N C I A L S T A T E M E N T S
Consolidated ($000s)
Note
2024
2023
Revenue
A2
698,664
596,456
Cost of sales
B2
(132,874)
(119,742)
Gross profit
565,790
476,714
Salaries and employee benefits expense
A3
(206,281)
(182,377)
Property expenses
A3
(41,487)
(25,313)
Distribution costs
B2
(25,398)
(28,403)
Depreciation and amortisation expense
(93,122)
(74,224)
Loss on disposal of property, plant and equipment
(108)
(1,181)
Impairment (expenses) / reversals
A4
(2,220)
19
Other income
535
614
Other expenses
A3
(69,532)
(60,107)
Operating profit
128,177
105,742
Finance income
248
224
Finance costs
(17,833)
(13,068)
Net finance costs
(17,585)
(12,844)
Profit before tax
110,592
92,898
Income tax expense
A7
(28,181)
(24,734)
Profit after tax
82,411
68,164
Other comprehensive income
Items that may be reclassified to profit or loss:
Cash flow hedges
(656)
(878)
Foreign operations - foreign currency translation differences
(8,612)
3,697
(9,268)
2,819
Other comprehensive income, net of tax
(9,268)
2,819
Total comprehensive income
73,143
70,983
Profit attributable to:
Owners of the Company
82,411
68,164
82,411
68,164
Total comprehensive income attributable to:
Owners of the Company
73,143
70,983
Total comprehensive income for the year
73,143
70,983
Earnings per share
Basic earnings per share (cents)
A5
75.38
63.25
Diluted earnings per share (cents)
A5
74.47
61.94
CONSOLIDATED STATEMENT OF PROFIT OR LOSS &
OTHER COMPREHENSIVE INCOME
For the financial year ended 30 June 2024
The Notes on pages 41 to 80 are an integral part of these consolidated financial statements.
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 39
F I N A N C I A L S T A T E M E N T S
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
As at 30 June 2024
Consolidated ($000s)
Note
Share
Capital
Common
Control
Reserve
Retained Earnings
Share Based
Payments
Reserve
Cash Flow
Hedge
Reserve
Foreign
Currency
Translation
Reserve
Total Equity
Balance at 4 July 2022
213,877
(208,906)
28,321
22,570
1,544
6,917
64,323
Total comprehensive income
for the year
Profit
-
-
68,164
-
-
-
68,164
Cash flow hedges
-
-
-
-
(878)
-
(878)
Foreign operations - foreign
currency translation
differences
-
-
-
-
-
3,697
3,697
Total comprehensive income
for the year
-
-
68,164
(878)
3,697
70,983
Capital contributions
C1
260
-
-
-
-
-
260
Employee share schemes
D3
-
-
-
25,297
-
-
25,297
Transfers from Reserves
-
-
15,623
(15,623)
-
-
-
Dividends
A6
-
-
(80,874)
-
-
-
(80,874)
Total transactions with
owners of the company
260
-
(65,251)
9,674
-
-
(55,317)
Balance at 2 July 2023
214,137
(208,906)
31,234
32,244
666
10,614
79,989
Balance at 3 July 2023
214,137
(208,906)
31,234
32,244
666
10,614
79,989
Total comprehensive income
for the year
Profit
-
-
82,411
-
-
-
82,411
Cash flow hedges
-
-
-
-
(656)
-
(656)
Foreign operations - foreign
currency translation
differences
-
-
-
-
-
(8,612)
(8,612)
Total comprehensive income
for the year
-
-
82,411
-
(656)
(8,612)
73,143
Capital contributions
C1
715
-
-
-
-
-
715
Employee share schemes
D3
-
-
-
15,290
-
-
15,290
Transfers from Reserves
-
-
29,306
(29,306)
-
-
-
Dividends
A6
-
-
(88,851)
-
-
-
(88,851)
Total transactions with
owners of the company
715
-
(59,545)
(14,016)
-
-
(72,846)
Balance at 30 June 2024
214,852
(208,906)
54,100
18,228
10
2,002
80,286
The Notes on pages 41 to 80 are an integral part of these consolidated financial statements.
Attributable to Equity Holders of the Company
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 40
F I N A N C I A L S T A T E M E N T S
CONSOLIDATED STATEMENT OF CASH FLOWS
For the financial year ended 30 June 2024
Consolidated ($000s)
Note
2024
2023
Cash flows from operating activities
Cash receipts from customers
784,907
665,072
Cash paid to suppliers and employees
(544,502)
(476,695)
Cash generated from operating activities
240,405
188,377
Interest received
248
224
Interest paid
(17,833)
(13,068)
Income taxes paid
(35,306)
(34,369)
Net cash from operating activities
C5
187,514
141,164
Cash flows from investing activities
Acquisition of fixed assets
(38,459)
(76,677)
Proceeds from fit out contributions
15,338
16,147
Acquisition of key money intangibles
B5
(147)
(191)
Net cash used in investing activities
(23,268)
(60,721)
Cash flows from financing activities
Share options exercised
715
260
(Repayment of borrowings)/Facility proceeds
C3
(11,000)
55,000
Payment of lease liabilities
B10
(66,020)
(57,997)
Dividends paid
A6
(88,851)
(80,874)
Net cash used in financing activities
(165,156)
(83,611)
Net decrease in cash and cash equivalents
(910)
(3,168)
Cash and cash equivalents at the beginning of the year
C5
31,650
34,153
Effect of movement in exchange rates on cash held
(220)
665
Cash and cash equivalents at the end of the year
C5
30,520
31,650
The Notes on pages 41 to 80 are an integral part of these consolidated financial statements.
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 41
N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
Lovisa Holdings Limited (the “Company”) is a for-profit
company incorporated and domiciled in Australia with
its registered office at Level 1, 818-820 Glenferrie Road,
Hawthorn, Victoria 3122. The consolidated financial
statements comprise the Company and its subsidiaries
(collectively the “Group” and individually the “Group
companies”). The Group is primarily involved in the retail
sale of fashion jewellery and accessories.
Lovisa Holdings Limited reports within a retail financial
period. The current financial year represents a 52 week
period ended on 30 June 2024 (2023: 52 week period
ended 2 July 2023). This treatment is consistent with section
323D of Corporations Act 2001.
The consolidated financial statements of the Group for the
financial year ended 30 June 2024 were authorised for
issue by the Board of Directors on 26 August 2024.
Basis of accounting
The consolidated financial statements and supporting notes
form a general purpose financial report. It:
• Has been prepared in accordance with the requirements
of the Corporations Act 2001, Australian Accounting
Standards (AASBs) including Australian Accounting
Interpretations, adopted by the Australian Accounting
Standards Board (AASB) and International Financial
Reporting Standards (IFRS) and Interpretations as issued
by the International Accounting Standards Board;
• Has been prepared on a historical cost basis except for
derivative financial instruments which are measured at
fair value;
• Presents reclassified comparative information where
required for consistency with the current year’s
presentation;
• Adopts all new and amended Accounting Standards and
Interpretations issued by the AASB that are relevant to
the operations of the Group and effective for reporting
periods beginning on or after 1 July 2023. These do not
result in significant impacts on the FY24 Consolidated
Financial Statements;
• Does not early adopt any Accounting Standards and
Interpretations that have been issued or amended but
are not yet effective except as disclosed in note D9; and
• Has been prepared on a going concern basis of
accounting. At 30 June 2024, the Group’s statement
S E T T I N G T H E S C E N E
of financial position is in a net current liability position
of $9.7m, with net assets of $80.3m. The Group’s
approach to managing liquidity risk is detailed in
Note C4 and the Group’s undrawn credit facilities are
detailed in Note C3. The Group continues to be able to
meet its financial obligations as and when they fall due
and remains a going concern.
Use of judgements and estimates
In preparing these consolidated financial statements,
management has made a number of judgements, estimates
and assumptions that affect the application of accounting
policies and the reported amounts of assets, liabilities,
income and expenses. Actual results may differ from these
estimates. Judgements and estimates which are material to
the financial statements are outlined below.
Assumptions and estimation uncertainties
In making estimates of future performance, key assumptions
and judgements have been stress tested for the impacts of
prevailing economic conditions.
Global economic conditions remain uncertain and with
a number of our markets continuing to experience above
average levels of inflation and associated rising interest
rates, this may slow demand and consumer spending across
the broader global economy.
In respect of these financial statements, the impact of the
uncertainties arising from these economic conditions is primarily
relevant to estimates of future performance, which is in turn
relevant to the areas of impairment of non-financial assets.
In all scenarios modelled, the liquidity requirements of the
Group are within the available facilities and are forecast to
meet financial covenants.
Information about assumptions and estimation uncertainties
that have a significant risk of resulting in a material adjustment
within the financial year ended 30 June 2024 are included
in the following notes:
• Note A7 – recognition of deferred tax assets: availability
of future taxable profit against which carry forward tax
losses can be used;
• Note B2 - inventories: recognition and measurement of
stock provisioning;
• Note B6 – impairment test: key assumptions underlying
Lovisa Holdings Limited Annual Report - 30 June 2024
P / 42
N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
recoverable amounts, including the recoverability of
goodwill and key money;
• Notes B8 and D2 – recognition and measurement of
provisions for site restoration and contingencies: key
assumptions about the likelihood and magnitude of an
outflow of resources; and
• Note B10 - recognition and measurement of lease
liabilities: key assumptions underlying the lease term
including the exericise or not of options or break
clauses.
Basis of consolidation
Business combinations
The Group accounts for business combinations using the
acquisition method when control is transferred to the Group.
The consideration transferred in the acquisition is generally
measured at fair value, as are the identifiable net assets
acquired. Any goodwill that arises is tested annually for
impairment (see note B6). Any gain on a bargain purchase
is recognised in profit or loss immediately. Transaction costs
are expensed as incurred, except if related to the issue of
debt or equity securities (see note C1).
The consideration transferred does not include amounts
related to the settlement of pre-existing relationships. Such
amounts are generally recognised in profit or loss.
Any contingent consideration payable is measured at fair
value at the acquisition date. If the contingent consideration
is classified as equity, then it is not remeasured and settlement
is accounted for within equity. Otherwise, subsequent
changes in the fair value of the contingent consideration are
recognised in profit or loss.
Acquisition of assets
The Group accounts for asset purchases by allocating the
transaction price to the individual assets and liabilities
acquired based on their relative fair values at the date of
purchase.
Subsidiaries
Subsidiaries are all entities over which the Group has control.
The Group controls an entity when the Group is exposed to,
or has rights to, variable returns from its investment with the
entity and has the ability to affect those returns through its
power to direct activities of the entity.
The financial results of subsidiaries are included in the
consolidated financial information from the date that
control commences until the date that control ceases.
The accounting policies of subsidiaries have been changed
when necessary to align them with the policies adopted by
the Group.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised
income and expenses arising from intra-group transactions,
are eliminated.
Foreign currency
Functional and presentation currency
These consolidated financial statements are presented
in Australian dollars, which is the Company’s functional
currency.
The Group is of a kind referred to in ASIC Corporations
(Rounding
in
Financial/Directors’
Reports)
Instrument
2016/191 and in accordance with that instrument all
financial information presented in Australian dollars has
been rounded to the nearest thousand unless otherwise
stated.
Translation of foreign currency transactions
Transactions in foreign currencies are translated to the
respective functional currencies of Lovisa at the exchange
rates at the dates of the transactions. Monetary assets and
liabilities denominated in foreign currencies at the reporting
date are retranslated to the functional currency at the
exchange rate at that date.
Non-monetary assets and liabilities denominated in foreign
currencies that are measured at fair value are retranslated
to the functional currency at the exchange rate at the date
that the fair value was determined. Non-monetary items in
a foreign currency that are measured in terms of historical
cost are translated using the exchange rate at the date of the
transaction.
Foreign currency differences arising on retranslation are
recognised in profit or loss.
Foreign operations
The assets and liabilities of foreign operations are translated
to Australian dollars at exchange rates at the end of the
reporting period. The income and expenses of foreign
operations are translated to Australian dollars at exchange
rates at the dates of the transactions. Goodwill and fair value
adjustments arising on the acquisition of a foreign operation
are treated as assets and liabilities of the foreign operation
and are translated at the exchange rates at the end of the
reporting period.
Foreign currency differences are recognised in other
comprehensive income, and presented in the foreign
currency translation reserve in equity. When a foreign
currency operation is disposed of, the cumulative amount
in the translation reserve related to that foreign operation is
transferred to profit or loss on disposal of the entity.
When the settlement of a monetary item receivable from
or payable to a foreign operation is neither planned nor
likely to occur in the foreseeable future, foreign exchange
gains and losses arising from such a monetary item that
are considered to form part of a net investment in a foreign
operation are recognised in other comprehensive income,
and are presented in the translation reserve in equity.
About the Notes to the financial statements
The notes include information which is required to understand
the financial statements and is material and relevant to
the operations, financial position and performance of the
Group. Information is considered material and relevant if,
for example:
• The amount with respect to the information is significant
because of its size or nature;
• The information is important for understanding the results
of the Group;
• It helps to explain the impact of significant changes in
the Group’s business; or
• It relates to an aspect of the Group’s operations that is
important to its future performance.
Subsequent events
Other than the dividend determined to be paid as set out in
Note A6, no matters or circumstances that have arisen since
the end of the financial year which significantly affected or
may significantly affect the operations of the Group, the
result of those operations, or the state of affairs of the Group
in future financial years.
Lovisa Holdings Limited Annual Report - 30 June 2024
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
A1 OPERATING SEGMENTS
(a) Basis for segmentation
The Chief Operating Decision Maker (CODM) for Lovisa Holdings Limited and its controlled entities is the Chief Executive
Officer (CEO). For management purposes, the Group is organised into geographic segments to review sales by territory as
the CODM relies primarily on revenue to assess the performance of the segment and make decisions about resources to be
allocated. All territories offer similar products and services and are managed by sales teams in each territory reporting to
regional management, however overall company performance is managed on a global level by the CEO and the Group’s
management team. Store performance is typically assessed at an individual store level. The individual stores are reportable
segments but meet the aggregation criteria to form reportable segments at a geographic level.
The Group’s stores exhibit similar long-term financial performance and economic characteristics within each geography,
which include:
a. Consistent products are offered;
b. All stock sold utilises common design processes and products are sourced from the same supplier base; and
c. Customer base is similar.
This section highlights key financial performance measures of the Lovisa Group’s operating segments, as well as Group
financial metrics incorporating revenue, earnings, taxation and dividends.
(b) Geographic information
The segments have been disclosed on a regional basis consisting of Australia and New Zealand, Asia (Singapore,
Malaysia, Hong Kong, Taiwan, Vietnam, and China), Africa/Middle East (South Africa, Botswana, Namibia, and United
Arab Emirates), Americas (United States of America, Canada, and Mexico), and Europe (United Kingdom, Spain, France,
Luxembourg, Belgium, Germany, Netherlands, Austria, Switzerland, Poland, Italy, Hungary, Romania, and Ireland) and the
Group’s franchise stores in the Middle East, Africa, and South America. Geographic revenue information is included in Note
A2.
In presenting the following information, segment assets were based on the geographic location of the assets.
2024
2023
($000s)
Non-current assets (i)
Non-current assets (i)
Australia / New Zealand (ii)
59,158
63,795
Asia
9,231
11,750
Africa / Middle East
9,286
7,366
Europe
144,553
123,330
Americas
152,759
170,889
Total
374,987
377,130
(i) Excluding financial instruments, deferred tax assets, employee benefit assets and intangible assets.
(ii) Australia’s non-current assets as at 30 June 2024 are $53,932,000 (2023: $56,850,000).
B U S I N E S S P E R F O R M A N C E
Lovisa Holdings Limited Annual Report - 30 June 2024
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
A2 REVENUE
Revenue by nature and geography
The geographic information below analyses the Group’s revenue by region. In presenting the following information, segment
revenue has been based on the geographic location of customers.
($000s)
2024
2023
Sale of Goods
Australia / New Zealand (i)
200,075
198,646
Asia
36,976
37,311
Africa / Middle East
52,195
48,800
Europe
230,413
181,639
Americas
177,498
128,183
Total Sale of Goods
697,157
594,579
Franchise Revenue
South America
289
292
Middle East
947
1,547
Africa
271
38
Total Franchise Revenue
1,507
1,877
Total Revenue
698,664
596,456
(i) Australia’s revenue for the year ended 30 June 2024 is $175,639,000 (2023: $174,839,000)
Revenue recognition and measurement
Revenue is recognised when the customer obtains control of the goods, recovery of the consideration is probable, the
associated costs and possible return of goods can be estimated reliably, there is no continuing management involvement
with the goods, and the amount of revenue can be measured reliably. Revenue is measured net of returns and trade
discounts. The following specific recognition criteria must also be met before revenue is recognised:
Sale of Goods
Revenue from the sale of fashion jewellery is recognised when the customer obtains control of the goods. A right of return
provision has been recognised in line with the Group’s returns policy and in line with the requirements of AASB 15 along with
a right to recover returned goods asset. The right of return provision decreases revenue and the right to recover returned
goods decreases cost of sales.
Franchise income
Franchise income, which is generally earned based upon a percentage of sales is recognised on an accrual basis.
Lovisa Holdings Limited Annual Report - 30 June 2024
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
A3 EXPENSES
Expenses by nature
Consolidated ($000s)
2024
2023
Property expenses
Variable lease expenses
10,978
2,626
Outgoings
30,509
22,687
Total property expenses
41,487
25,313
Salaries and employee benefits expense
Wages and salaries
172,820
138,715
Compulsory social security contributions
20,465
15,819
Increase in liability for long-service leave
218
78
LTI - Cash component
2,018
2,468
Share-based payment expense
10,760
25,297
Total salaries and employee benefits expense
206,281
182,377
Other expenses
Administrative expenses
21,021
15,992
Banking expenses
8,723
7,382
Data and communication expenses
14,135
9,403
Legal and consulting expenses
10,336
10,617
Other expenses
15,317
16,713
Total other expenses
69,532
60,107
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
A4 IMPAIRMENT
Amounts recognised in profit or loss
Consolidated ($000s)
2024
2023
Store impairment charges
3,959
2,075
Key money impairment charges
-
78
Reversal of store impairment charges
(1,739)
(2,172)
2,220
(19)
During the year ended 30 June 2024, net impairment expense of $2,220,000 ($2,220,000 after tax) (2023: $19,000
impairment reversal ($19,000 after tax)) was included within the consolidated statement of profit or loss and other
comprehensive income. This impairment expense was in the Americas, Europe and Asian regions. Refer to Note B6.
A5 EARNINGS PER SHARE (EPS)
Calculation methodology
The calculation of basic earnings per share has been based on the following profit attributable to ordinary shareholders and
weighted-average number of ordinary shares outstanding.
The calculation of diluted earnings per share has been based on the following profit attributable to ordinary shareholders
and weighted-average number of ordinary shares outstanding after adjustment for the effects of all dilutive potential ordinary
shares.
EPS for profit attributable to ordinary shareholders of Lovisa Holdings Limited
2024
2023
Basic EPS (cents)
75.38
63.25
Diluted EPS (cents)
74.47
61.94
Profit attributable to ordinary shareholders ($000s)
82,411
68,164
Weighted average number of ordinary shares for basic EPS (shares)
109,324,573
107,763,351
Weighted average number of ordinary shares and potential ordinary shares for diluted EPS
(shares)
110,662,667
110,049,842
2024
2023
Weighted average number of ordinary shares used as the denominator in calculating basic
earnings per share
109,324,573
107,763,351
Adjustments for calculation of diluted earnings per share:
- Options
25,091
89,878
- Performance rights
1,313,003
2,196,613
Weighted average number of ordinary shares and potential ordinary shares used as the
denominator in calculating diluted earnings per share
110,662,667
110,049,842
Information concerning the classification of securities
i) Options and performance rights
Options and performance rights granted to employees under the Lovisa Holdings Long Term Incentive Plan are considered
to be potential ordinary shares. They have been included in the determination of diluted earnings per share if the required
hurdles would have been met based on the Group’s performance up to the reporting date, and to the extent to which they
are dilutive. The options and performance rights have not been included in the determination of basic earnings per share.
Details relating to the options and performance rights are set out in note D3.
At 30 June 2024, no options and performance rights (2023: nil) were excluded from the diluted weighted average
number of ordinary shares calculation because their effect would have been anti-dilutive.
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
A6 DIVIDENDS
The Board may pay any interim and final dividends that, in its judgement, the financial position of the Company justifies.
The Board may also pay any dividend required to be paid under the terms of issue of a Share, and fix a record date for a
dividend and the timing and method of payment.
The following dividends were paid by the Company for the year.
Consolidated ($000s)
2024
2023
31.0 cents per qualifying ordinary share, 70% franked (2023: 37.0 cents, 30% franked)
34,005
39,898
50.0 cents per qualifying ordinary share, 30% franked (2023: 38.0 cents, fully franked)
54,846
40,976
88,851
80,874
After the reporting date, the following dividends were proposed by the Board of Directors. The dividends have not been
recognised as liabilities and there are no tax consequences.
Consolidated ($000s)
2024
2023
37.0 cents per qualifying ordinary share, unfranked (2023: 31.0 cents, 70% franked)
40,586
33,428
40,586
33,428
Consolidated ($000s)
2024
2023
Dividend franking account
Franking credits available for subsequent reporting periods based on a tax rate of 30.0% (2023:
30%)
3,508
5,933
A7 INCOME TAXES
Recognition and measurement
Income tax on the profit or loss for the years presented comprises current and deferred tax. Income tax is recognised in the
statement of profit or loss except to the extent that it relates to items recognised directly in equity, in which case it is recognised
in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantially enacted
at the balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred tax is provided using the balance sheet liability method, providing for temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following
differences are not provided for: goodwill not deductible for tax purposes, the initial recognition of assets or liabilities that
affect neither accounting nor taxable profit, and differences relating to investments in subsidiaries to the extent that they will
probably not reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of
realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at
the balance sheet date.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against
which the asset can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related
tax benefit will be realised.
Additional income taxes that arise from the distribution of dividends are recognised at the same time as the liability to pay
the related dividend is recognised.
Deferred taxes arising from a single transaction
The Group has adopted Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to
AASB 12) from 1 July 2023. The amendments narrow the scope of the initial recognition exemption to exclude transactions
that give rise to equal and offsetting temporary differences such as leases. An entity is required to recognise the associated
deferred tax assets and liabilities from the beginning of the earliest comparative period presented, with any cumulative effect
recognised as an adjustment to retained earnings.
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
A7 INCOME TAXES (CONTINUED)
(a) Amounts recognised in profit or loss
Consolidated ($000s)
2024
2023
Current tax expense
Current period
29,696
30,161
Changes in estimates related to prior years
(756)
603
28,940
30,764
Deferred tax (benefit)/expense
Origination and reversal of temporary differences
(1,721)
(5,978)
Changes in temporary differences related to prior years
962
(52)
(759)
(6,030)
Total income tax expense
28,181
24,734
(b) Reconciliation of effective tax rate
Consolidated ($000s)
2024
2023
Profit before tax from continuing operations
110,592
92,898
Tax at the Australian tax rate of 30% (2023: 30%)
33,178
27,869
Effect of tax rates in foreign jurisdictions
(2,577)
(2,757)
Non-deductible expenses
277
121
Recognition of tax effect of previously unrecognised tax losses
(3,454)
(2,073)
Current year losses for which no deferred tax asset is recognised
614
782
Other movements
(1,378)
(201)
Changes in estimate related to prior years
603
603
Withholding tax payable
918
390
Total current period tax expense
28,181
24,734
Effective tax rates (ETR)
Bases of calculation of each ETR
Global operations – Total consolidated tax expense ETR: IFRS calculated total consolidated company income tax expense
divided by total consolidated accounting profit on continuing operations.
Australian operations – Australian company income tax expense ETR: IFRS calculated company income tax expense
for all Australian companies and Australian operations of overseas companies included in these consolidated
financial statements, divided by accounting profit derived by all Australian companies included in these consolidated
financial statements.
Percentage
2024
2023
ETR
Global operations – Total consolidated tax expense
25.5%
26.6%
Australian operations – Australian company income tax expense
27.4%
31.5%
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
A7 INCOME TAXES (CONTINUED)
(c) Deferred tax assets and liabilities reconciliation
Unused tax losses for which no deferred tax asset has been recognised total $2,719,000 (2023: $5,043,000).
(d) Expected settlement of deferred tax balances
Statement of financial position
Statement of profit or loss
Consolidated ($000s)
2024
2023
2024
2023
Property, plant and equipment
(2,332)
(5,852)
(3,604)
2,342
Employee benefits
2,644
2,134
(515)
(422)
Long term incentives
8,621
10,472
8,813
(7,250)
Provisions
1,608
1,127
(490)
(60)
Other items
982
1,329
(768)
532
Lease liabilities
67,130
70,696
(3,566)
28,675
Right-of-use assets
(63,912)
(67,841)
1,436
(28,785)
Transaction costs
58
94
36
13
Carry forward tax losses
5,735
8,765
(2,101)
(1,075)
Deferred tax expense
-
-
(759)
(6,030)
Net deferred tax assets
20,534
20,924
Presented in the Statement of financial position as follows:
Deferred tax assets
23,825
20,924
Deferred tax liability
2,751
-
Consolidated ($000s)
2024
2023
Deferred tax assets expected to be settled within 12 months
39,736
28,821
Deferred tax assets expected to be settled after 12 months
48,256
66,850
87,992
95,671
Deferred tax liabilities expected to be settled within 12 months
14,647
15,808
Deferred tax liabilities expected to be settled after 12 months
52,811
58,939
67,458
74,747
Net deferred tax assets
20,534
20,924
Global minimum tax framework
The Group has adopted International Tax Reform – Pillar Two Model Rules (Amendments to IAS 12) upon their release on
23 May 2023. The amendments provide a temporary mandatory exception from deferred tax accounting for the top-up tax,
which is effective immediately, and require new disclosures about the Pillar Two exposure.
The Group operates in several countries (refer note D1) which have either enacted or substantively enacted new tax legislation
to implement the Pillar Two global minimum top-up tax (top-up tax), which seeks to apply a 15% global minimum tax. The
Group does not expect to be subject to material top-up tax in relation to its operations in any of these countries.
The Group has applied a temporary mandatory relief from deferred tax accounting for the impacts of the top-up tax and will
account for it as a current tax if it is incurred from 1 July 2024.
The Group continues to monitor and evaluate domestic implementation of Pillar Two by relevant countries of the OECD
and based on the information available at this point in time, the exposure to the additional taxation under Pillar Two is not
estimated to be material for the Group.
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Impairment of receivables
Recoverability of receivables is assessed monthly to determine whether there is any indication of impairment. If any such
indication exists then the asset’s recoverable amount is estimated. An impairment loss is recognised in profit or loss if the
carrying amount of an asset exceeds its recoverable amount.
The recoverable amount of the Group’s receivables carried at amortised cost is calculated as the present value of estimated
future cash flows, discounted at the original effective interest rate (i.e. the effective interest rate computed at initial recognition
of these financial assets). Significant receivables are individually assessed for impairment. Receivables with a short duration
are not discounted.
Information about the Group’s exposure to credit and market risks, and impairment losses for trade and other receivables is
disclosed in Note C4.
B2 INVENTORIES
Recognition and measurement
Inventories are stated at the lower of cost and net realisable value. Net realisable value is the estimated selling price in the
ordinary course of business, less the estimated costs of completion and selling expenses. Cost includes the product purchase
cost, import freight and duties together with other costs incurred in bringing inventory to its present location and condition
using the weighted average cost method. All stock on hand relates to finished goods.
Costs of goods sold comprises purchase price from the supplier, cost of shipping product from supplier to warehouse,
shrinkage and obsolescence. Warehouse and outbound freight costs are reported as distribution expenses. Inventories
recognised as expenses during 2024 and included in cost of sales amount to $128,962,000 (2023: $116,799,000).
During 2024, inventories of $19,017,000 (2023: $13,354,000) were written down to net realisable value and included
in cost of sales.
B3 PROPERTY, PLANT AND EQUIPMENT
Recognition and measurement
Owned Assets
Items of property, plant and equipment are stated at cost less accumulated depreciation. Cost includes expenditures that are
directly attributable to the acquisition of the assets. The cost of acquired assets includes estimates of the costs of dismantling
and removing the items and restoring the site on which they are located where it is probable that such costs will be incurred.
Subsequent costs
The Group recognises in the carrying amount of an item of property, plant and equipment the cost of replacing part of such
an item when that cost is incurred if it is probable that the future economic benefits embodied within the item will flow to the
entity and the cost of the item can be measured reliably. All other costs are recognised in the profit or loss as an expense as
incurred.
Depreciation and amortisation
Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful life on all property, plant and
equipment.
The residual value, the useful life and the depreciation method applied to an asset are re-assessed at least annually.
N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
This section outlines the key operating assets owned and liabilities incurred by the Group.
B1 TRADE AND OTHER RECEIVABLES
Recognition and measurement
Trade and other receivables are initially recognised at fair value and subsequently stated at their amortised cost using
the effective interest method, less impairment losses.
Consolidated ($000s)
Note
2024
2023
Trade receivables
1,397
1,857
Deposits
4,424
3,496
Prepayments
7,578
4,809
Other receivables (i)
6,046
13,040
19,445
23,202
(i) Other receivables include landlord fit-out contributions receivable.
A S S E T P L A T F O R M
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
B3 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
Derecognition
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected
from its use. Gains and losses on disposals are determined by comparing disposal proceeds with the carrying amount of the
disposed asset and are recognised in the profit or loss in the year the disposal occurs.
Reconciliation of carrying amount
Consolidated ($000s)
Note
Leasehold
improvements
Hardware and
software
Fixtures and
fittings
Total
Accumulated depreciation and
impairment losses
Balance at 4 July 2022
(63,710)
(8,527)
(2,265)
(74,502)
Depreciation
(20,347)
(1,644)
(356)
(22,347)
Impairment
(1,086)
-
-
(1,086)
Disposals
2,676
125
126
2,927
Effect of movements in exchange rates
(1,593)
(64)
(5)
(1,662)
Balance at 2 July 2023
(84,060)
(10,110)
(2,500)
(96,670)
Balance at 3 Jul 2023
(84,060)
(10,110)
(2,500)
(96,670)
Depreciation
(29,522)
(1,704)
(228)
(31,454)
Impairment
(1,741)
-
-
(1,741)
Disposals
1,096
86
-
1,182
Effect of movements in exchange rates
599
25
-
624
Balance at 30 June 2024
(113,628)
(11,703)
(2,728)
(128,059)
Carrying amounts
At 3 July 2022
64,900
1,878
477
67,255
At 2 July 2023
118,565
2,368
456
121,389
At 30 June 2024
121,420
1,883
285
123,588
Consolidated ($000s)
Note
Leasehold
improvements
Hardware and
software
Fixtures and fittings
Total
Depreciation policy
Lease term
3 years
3 years
Cost
Balance at 4 July 2022
128,610
10,405
2,742
141,757
Additions
75,036
2,070
308
77,414
Disposals
(4,755)
(155)
(137)
(5,047)
Effect of movements in exchange rates
3,734
158
43
3,935
Balance at 2 July 2023
202,625
12,478
2,956
218,059
Balance at 3 July 2023
202,625
12,478
2,956
218,059
Additions
35,633
1,217
55
36,905
Disposals
(1,781)
(92)
-
(1,873)
Effect of movements in exchange rates
(1,429)
(17)
2
(1,444)
Balance at 30 June 2024
235,048
13,586
3,013
251,647
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
Consolidated ($000s)
Note
Total
Accumulated depreciation and impairment losses
Balance at 4 July 2022
(116,330)
Depreciation and impairment charges for the year
(51,866)
Impairments
1,183
Effect of movements in exchange rates
(3,727)
Balance at 2 July 2023
(170,740)
Balance at 3 July 2023
(170,740)
Depreciation and impairment charges for the year
(61,652)
Impairments
9
Effect of movements in exchange rates
1,700
Balance at 30 June 2024
(230,683)
Carrying amounts
At 3 July 2022
172,037
At 2 July 2023
255,741
At 30 June 2024
251,399
Consolidated ($000s)
Note
Total
Cost
Balance at 4 July 2022
288,367
Additions
105,618
Re-measurement of lease liabilities
20,665
Effect of movements in exchange rates
11,831
Balance at 2 July 2023
426,481
Balance at 3 July 2023
426,481
Additions
51,997
Re-measurement of lease liabilities
7,563
Effect of movements in exchange rates
(3,959)
Balance at 30 June 2024
482,082
B4 RIGHT-OF-USE ASSET
The Group has leases for retail stores, offices and warehouse facilities. The leases run for a period of 3 to 10 years but may
have extension options as described below.
Accounting policy
At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease
if the contract conveys a right to control the use of an identified asset for a period of time in exchange for consideration.
The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is
initially measured at cost, which comprises the initial amount of the lease liability, plus any initial direct costs incurred and
an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is
located, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date to the end of
the lease term. It may subsequently be reduced by impairment losses and adjusted for certain remeasurements of the lease
liability.
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
B4 RIGHT-OF-USE ASSET (CONTINUED)
Accounting policy (continued)
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement
date, discounted using the Group’s incremental borrowing rate. The Group determines its incremental borrowing rate by
adjusting its current borrowing rates with market specific interest rates obtained from external financing sources.
The lease liability is subsequently increased by the interest cost on the lease liability and decreased by lease payments
made. It is remeasured when there is a change in future lease payments arising from a change in an index or rate, a change
in the estimate of the amount expected to be payable under a residual value guarantee, or as appropriate changes in
the assessment of whether a purchase or extension option is reasonably certain to be exercised or a termination option is
reasonably certain not to be exercised.
When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-
of-use asset or is recorded in profit or loss if the carrying amount of the right-of-use asset has been reduced to zero.
The Group has applied judgement to determine the lease term for some lease contracts in which it is a lessee that include
renewal options. The assessment of whether the Group is reasonably certain to exercise such options impacts the lease term,
which significantly affects the amount of lease liabilities and right-of-use assets recognised.
Variable lease payments: Leases may include variable lease payments, including payments that are variable based on a
percentage of sales, depend on an index or rate, as well as variable payments for items such as property taxes, insurance,
promotion spend, and other operating expenses associated with leased assets. Such variable lease payments are excluded
from the calculation of the right-of-use asset and are recognised in the period in which the obligation is incurred.
Low value assets: The Group has elected not to recognise right-of-use assets and lease liabilities for some leases of low-value
assets, such as office equipment. The Group recognises the lease payments associated with these leases as an expense on
a straight-line basis over the lease term.
Recognition and measurement
Additions to right-of-use assets represent leases for new stores. Right-of-use assets have been adjusted for the re-measurement
of lease liabilities due to changes to existing lease terms, including extensions to existing lease terms. As a result of re-
measurement adjustments exceeding the carrying value of the right-of-use asset, a gain of $535,000 has been recognised
in other income in the statement of profit or loss and other comprehensive income during the year ended 30 June 2024
(2023: $614,000).
At 30 June 2024, the Group has executed leases for which the lease commencement date has not yet occurred. These leases
have a duration of up to 10 years and once commenced will result in an increase in lease liabilities and right-of-use assets,
on a total basis, of approximately $7,996,000 (2023: $14,129,000).
The Group has not recognised any rent concessions that are a direct consequence of the COVID-19 pandemic in the
statement of profit or loss and other comprehensive income for the year ended 30 June 2024 (2023: $306,000).
Expenses relating to variable lease payments not included in lease liabilities of $10,956,000 have been recognised in the
statement of profit or loss and other comprehensive income for the year ended 30 June 2024 (2023: $2,910,000).
B5 INTANGIBLE ASSETS AND GOODWILL
Recognition and measurement
Goodwill
Goodwill arising on the acquisition of subsidiaries is measured at cost less accumulated impairment losses. Goodwill is not
amortised.
Key Money
Key money represents expenditure associated with acquiring existing operating lease agreements for company-operated
stores in countries where there is an active market for key money (e.g. regularly published transaction prices), also referred
to as ‘rights of use’. Key money is not amortised but annually tested for impairment. Key money in countries where there is
not an active market for key money is amortised over the contractual lease period.
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
B6 IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT, RIGHT-OF-USE
ASSETS AND INTANGIBLE ASSETS AND GOODWILL
Recognition and measurement
Impairment
The carrying amounts of the Group’s goodwill and indefinite life intangibles are tested for impairment at each reporting
period. Property, plant and equipment are reviewed at each reporting date to determine whether there is any indication of
impairment. If any such indication exists, the asset’s recoverable amount is estimated in line with the calculation methodology
listed below.
Cash-generating units
An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit (CGU) exceeds its recoverable
amount. A cash-generating unit is the smallest identifiable asset group that generates cash flows that largely are independent
from other assets and groups. Goodwill is tested at the level at which it is monitored, identified by the Group as the country
level. Key money is tested at the store level. Property, plant and equipment and right-of-use assets are tested at the store level
when there is an indication of impairment.
Calculation of recoverable amount
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell.
The Group uses value in use for the purposes of impairment testing, with the estimated future cash flows discounted to their
present value using a post-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset or CGU. Sensitivity analysis is performed on this modelling by using a range of discount rates reflecting
the potential risk of variability in the underlying forecasts or regional or market specific risks.
Cash flow forecasts
Cash flow forecasts are based on the Group’s most recent plans and are based on expectations of future outcomes having
regard to market demand and past experience, incorporating individual trading environment and risks specific to the CGU.
For store level tests, cash flow forecasts are modelled for the length of the lease, identified as the essential asset for store
CGUs. No terminal value is reflected in store level tests.
Discount rates
The Group applies a post-tax discount rate to post-tax cash flows. The post-tax discount rates incorporate a risk adjustment
relative to the risks associated with the specific CGU (geographic position or otherwise), with a high and low range used to
apply sensitivity analysis to the cash flow modelling.
B5 INTANGIBLE ASSETS AND GOODWILL (CONTINUED)
Consolidated ($000s)
Note
Key Money
Goodwill
Balance at 4 July 2022
2,048
2,186
Additions
191
-
Disposals
-
-
Impairment
(78)
-
Amortisation
(10)
-
Effect of movements in exchange rates
155
(218)
Balance at 2 July 2023
2,306
1,968
Balance at 3 July 2023
2,306
1,968
Additions
147
-
Disposals
-
-
Impairment
-
-
Amortisation
(24)
-
Effect of movements in exchange rates
(50)
72
Balance at 30 June 2024
2,379
2,040
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
Key assumptions for the impairment testing carried out at 30 June 2024
Stores with indicators of impairment at 30 June 2024 were identified in certain of the Group’s markets, requiring more
detailed testing for certain stores. The following key assumptions were utilised for this impairment testing:
•
Discount rate by country applied based on a high and low range to provide sensitivity analysis. The discount rates
applied to store tests in these countries were in the range of 10% to 15% pre-tax.
•
Growth rate based on expected sales profile by market with a longer term growth rate assumption of 3% in relation to
sales and costs to allow for inflationary impacts until the end of the lease term which is considered to be the essential
asset. No terminal value is included in discounted cash flow modelling at store level.
As a result of this testing, an impairment expense of $3,959,000 was recognised for store fit-out and lease right-of-use assets
(2023: $2,075,000 for store fit-out and lease right-of-use assets). Refer to notes B3, B4 and B5 for further detail.
Reversals of impairment
An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognised in
previous years are assessed at each reporting date for any indications that the loss has decreased or no longer
exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable
amount. 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, if no impairment loss had been recognised.
Prior years’ impairment losses totalling $1,739,000 were reversed during the current year (2023: $2,172,000).
B7 TRADE AND OTHER PAYABLES
Recognition and measurement
Liabilities for trade payables and other amounts are carried at their amortised cost.
Payables to related parties are carried at the principal amount. Interest, when charged by the lender, is recognised as an
expense on an accrual basis.
Consolidated ($000s)
2024
2023
Trade payables
33,071
19,075
Accrued expenses
28,069
20,602
61,140
39,677
Trade payables are unsecured and are usually paid within 30 days of recognition. Information about the Group’s exposure
to currency and liquidity risk is included in Note C4.
B8 PROVISIONS
Recognition and measurement
A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be
estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions
are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of
the time value of money and the risks specific to the liability. The unwinding of the discount is recognised as a finance cost.
A provision for dividends is not recognised as a liability unless the dividends are declared, determined or publicly
recommended on or before the reporting date.
Consolidated ($000s)
Site restoration
Return
provision
Total
Balance at 3 July 2023
9,721
553
10,274
Provisions made during the year
1,859
400
2,259
Provisions used during the year
(808)
(311)
(1,119)
Effect of movement in exchange rates
(56)
(4)
(60)
Balance at 30 June 2024
10,716
638
11,354
Current
1,884
638
2,522
Non-current
8,832
-
8,832
10,716
638
11,354
B6 IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT, RIGHT-OF-USE
ASSETS AND INTANGIBLE ASSETS AND GOODWILL (CONTINUED)
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B8 PROVISIONS (CONTINUED)
(a) Site restoration
Key Estimates
In accordance with the Group’s legal requirements, a provision for site restoration in
respect of make good of leased premises is recognised when the premises are occupied.
The provision is the best estimate of the present value of the expenditure required to settle
the restoration obligation at the reporting date, based on current legal requirements and
technology. Future restoration costs are reviewed annually and any changes are reflected
in the present value of the restoration provision at the end of the reporting period.
Since the adoption of AASB 16 Leases from 1 July 2019, site restoration is now capitalised
as part of the lease right-of-use asset and depreciated over the life of the lease term. For
prior periods the amount of the provision for future restoration costs was capitalised as part
of leasehold improvements and depreciated over the estimated useful life of the leasehold
improvements. The unwinding of the effect of discounting on the provision was recognised
as a finance cost.
Expenditure to settle the restoration obligation
at the end of the lease term is based on the
Group’s best estimate of cost of restorations.
B9 EMPLOYEE BENEFITS
Recognition and measurement
Long-term service benefits
The Group’s net obligation in respect of long-term service benefits is the amount of future benefit that employees have earned
in return for their service in the current and prior periods. The obligation is calculated using expected future increases
in wage and salary rates including related on-costs and expected settlement dates, and is discounted using high quality
Australian corporate bond rates at the balance sheet date which have maturity dates approximating to the terms of the
Group’s obligations.
Short-term benefits
Liabilities for employee benefits for wages, salaries and annual leave that are expected to be settled within 12 months of the
reporting date represent present obligations resulting from employees’ services provided to reporting date, are calculated
at undiscounted amounts based on remuneration wage and salary rates that the Group expects to pay as at reporting date
including related on-costs, such as workers compensation insurance and payroll tax.
Consolidated ($000s)
2024
2023
Current
Liability for annual leave
8,437
6,992
Liability for long-service leave
743
675
Non-Current
Liability for long-service leave
432
339
Total employee benefit liabilities
9,612
8,006
For details on the related employee benefit expenses, see Note A3.
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate
entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined
contribution plans are expensed as the related service is provided. Prepaid contributions are recognised as an asset to the
extent that a cash refund or a reduction in future payments is available.
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
B10 LEASE LIABILITIES
The Group has leases for retail stores, offices and warehouse facilities. The leases run for a period of 3 to 10 years but
may have extension options as described below.
Consolidated ($000s)
Note
Total
Balance at 4 July 2022
218,372
Liability recognised during the period
117,660
Re-measurement of lease liabilities
20,100
Lease payments
(68,574)
Interest
10,577
Effect of movements in exchange rates
9,452
Balance at 2 July 2023
307,587
Balance at 3 July 2023
307,587
Liability recognised during the period
55,228
Re-measurement of lease liabilities
10,914
Lease payments
(79,389)
Interest
13,369
Effect of movements in exchange rates
(2,642)
Balance at 30 June 2024
305,067
Current lease liability
58,406
Non-current lease liability
246,661
305,067
Accounting policy
Refer to note B4.
Recognition and measurement
Additions to lease liabilities represent leases for new stores. Lease liabilities have been re-measured due to changes to
existing lease terms, including extensions to existing lease terms and exercise of break clauses.
The Group has executed leases for which the lease commencement date has not yet occurred and therefore the lease liability
has not been recognised at 30 June 2024, refer to note B4.
The timing of the contractual cash flows for the lease liabilities are disclosed in note C4(b).
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
This section discusses the Group’s capital management practices, as well as the instruments and strategies utilised by the Group in
minimising exposures to and impact of various financial risks on the financial position and performance of the Group.
C1 CAPITAL AND RESERVES
Recognition and measurement
Ordinary shares
Initially, share capital is recognised at the fair value of the consideration received by the Company.
Any transaction costs arising on the issue of ordinary shares are recognised directly in equity as a reduction of the share
proceeds received.
(a) Share capital
No. of Ordinary Shares
Value of Ordinary Shares
2024
2023
2024
2023
Share Capital
‘000’s
‘000’s
‘000’s
‘000’s
On issue at beginning of year
107,832
107,460
241,684
234,165
Shares issue to Employee Share Trust
1,861
372
39,876
7,519
On issue at end of year
109,693
107,832
281,560
241,684
Treasury Shares
On issue at beginning of year
-
-
(27,547)
(20,288)
Shares issued to trust
(1,861)
(372)
(39,876)
(7,519)
Shares allocated on option exercise
1,861
372
715
260
-
-
(66,708)
(27,547)
Share Capital After Treasury Shares
109,693
107,832
214,852
214,137
All ordinary shares rank equally with regard to the Company’s residual assets.
(i) Ordinary shares
The Company does not have authorised capital or par value in respect of its issued shares. All issued shares are fully paid.
The holders of these shares are entitled to receive dividends as declared from time to time, and are entitled to one vote per
share at general meetings of the Company. All rights attached to the Company’s shares held by the Group are suspended
until those shares are reissued.
(ii) Treasury shares
Treasury shares are shares in Lovisa Holdings Limited that are held by the Lovisa Holdings Limited Share Trust for the purposes
of issuing shares under the Long Term Incentive Plans. When shares recognised as equity are repurchased, the amount of the
consideration paid, which includes directly attributable costs, is recognised as a deduction from equity. Repurchased shares
are classified as treasury shares and are presented in the treasury share reserve. When treasury shares are sold or reissued
subsequently, the amount received is recognised as an increase in equity and the resulting surplus or deficit on the transaction
is presented within share capital.
R I S K & C A P I T A L
M A N A G E M E N T
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C1 CAPITAL AND RESERVES (CONTINUED)
(b) Nature and purpose of reserves
(i) Common control reserve
The Group’s accounting policy is to use book value accounting for common control transactions. The book value used is the
book value of the transferor of the investment. Book value accounting is applied on the basis that the entities are part of a
larger economic group, and that the figures from the larger group are the relevant ones. In applying book value accounting,
no entries are recognised in profit or loss; instead, the result of the transaction is recognised in equity as arising from a
transaction with shareholders.
The book value (carry-over basis) is accounted for on the basis that the investment has simply been moved from one Group
owner to a new Group Company. In applying book value accounting, an adjustment may be required in equity to reflect any
difference between the consideration received and the aggregated capital of the transferee. The adjustment is reflected in
the ‘common control reserve’ capital account.
(ii) Translation reserve
The translation reserve reflects all foreign currency differences of the international entities upon translation to the Group’s
functional currency.
(iii) Hedging reserve
The hedging reserve comprises the effective portion of the cumulative net change in the fair value of hedging instruments used
in cash flow hedges pending subsequent recognition in profit or loss as the hedged cash flows affect profit or loss.
Cash flow hedges
When a derivative is designated as a cash flow hedging instrument, the effective portion of changes in the fair value of the
derivative is recognised in other comprehensive income and accumulated in the hedging reserve. Any ineffective portion of
changes in the fair value of the derivative is recognised immediately in profit or loss.
The amount accumulated in equity is retained in other comprehensive income and reclassified to profit or loss in the same
period or periods during which the hedged item affects profit or loss.
If the hedging instrument no longer meets the criteria for hedge accounting, expires or is sold, terminated or exercised, or the
designation is revoked, then hedge accounting is discontinued prospectively. If the forecast transaction is no longer expected
to occur, then the amount accumulated in equity is reclassified to profit or loss.
(iv) Share-based payments reserve
The share-based payments reserve is used to recognise:
•
the grant date fair value of options and performance rights issued to employees but not exercised
•
the grant date fair value of shares issued to employees
•
the grant date fair value of deferred shares granted to employees but not yet vested
C2 CAPITAL MANAGEMENT
The Group’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to
sustain future development of the business. The Board of Directors seeks to maintain a balance between the higher returns
that might be possible with higher levels of borrowings and the advantages and security afforded by a sound capital position.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return
capital to shareholders or issue new shares.
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
C3 LOANS AND BORROWINGS
Recognition and measurement
Loans and borrowings are initially recognised at fair value less any directly attributable transaction costs. Subsequent to
initial recognition, these liabilities are measured at amortised cost using the effective interest method.
Information about the Group’s exposure to interest rate, foreign currency and liquidity risk is included in Note C4.
(a) Terms and debt repayment schedule
Terms and conditions of outstanding loans are as follows:
30 June 2024
2 July 2023
Consolidated ($000s)
Lender
Currency
Nominal interest
rate
Year of
maturity
Facility
Limit
Amount
Drawn
Facility
Limit
Amount
Drawn
Cash advance facility
CBA
AUD
0.85% - 1.10% +
AUD BBSY Bid
2026
80,000
34,000
80,000
65,000
Multi-option facility - Overdraft
and Trade Finance
CBA
AUD
0.60% + AUD
BBSY Bid
2026
20,000
-
20,000
-
Revolving loan facility
HSBC
AUD
1.75% - 2.10% +
AUD BBSY Bid
2026
20,000
20,000
20,000
-
Total interest-bearing liabilities
120,000
54,000
120,000
65,000
The Group holds the following lines of credit with the Commonwealth Bank of Australia (CBA):
•
$80 million revolving cash advance facility (2023: $80 million)
•
$20 million multi option facility available for overdraft, trade finance and a contingent liability facility for global
letters of credit and bank guarantees (2023: $20 million).
The facilities were renewed during 2023 extending the maturity date of the facilities to 19 April 2026 (notwithstanding
that individual products by virtue of their nature have their own maturity dates) and increasing the available credit limit as
outlined above.
The bank loans are secured by security interests granted by Lovisa Holdings Limited and a number of its subsidiaries over all
of their assets in favour of the Commonwealth Bank of Australia (CBA). Under the facility the Group has financial covenants
and has been in compliance with these through the year ended 30 June 2024.
The Group holds the following lines of credit with the HSBC Bank Australia Limited (HSBC):
•
$20 million revolving loan facility (2023: $20 million)
•
$20 million bank guarantee facility for global letters of credit and bank guarantees (2023: $20 million)
The revolving loan facility was finalised in April 2023, and the bank guarantee facility was renewed at the same time,
extending the maturity date of the facilities to 19 April 2026 (notwithstanding that individual products by virtue of their nature
have their own maturity dates) and increasing the available credit limit as outlined above.
The HSBC facilities have been incorporated into the security deed for the CBA lending facilities. The financial covenants for
the CBA facilities also apply to this facility.
In addition to the above facilities with CBA and HSBC, the Group holds lines of credit in certain of its overseas markets which
are solely for the purpose of providing bank guarantees as security for store lease agreements.
Credit facilities for bank guarantees with ING Belgium (Euro 600,000) and Credit Suisse Switzerland (CHF 550,000) are
subject to annual credit reviews. Facilities with other banks are secured either by standby letters of credit or restricted savings
accounts, that is they are cash collateralised.
Refer to note D2(a) for guarantees outstanding at 30 June 2024.
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
C4 FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT
(a) Fair values
Recognition and measurement
A number of the Group’s accounting policies and disclosures require the measurement of fair values, for both financial and
non-financial assets and liabilities.
The Group has established a control framework with respect to the measurement of fair values. This includes overseeing all
significant fair value measurements, including Level 3 fair values, by the CFO.
The Group periodically reviews significant unobservable inputs and valuation adjustments. If third party information, such
as broker quotes or pricing services, is used to measure fair values, then the Group assesses the evidence obtained from the
third parties to support the conclusion that such valuations meet the requirements of IFRS, including the level in the fair value
hierarchy in which such valuations should be classified. Significant valuation issues are reported to the Group Audit, Business
Risk and Compliance Committee.
When measuring the fair value of an asset or a liability, the Group uses market observable data as far as possible. Fair
values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as
follows.
• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
• Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices).
• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
If the inputs used to measure the fair value of an asset or a liability might be categorised in different levels of the fair value
hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the
lowest level input that is significant to the entire measurement.
The Group recognises transfers between levels of the fair value hierarchy at the end of the financial year during which the
change has occurred.
The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their
levels in the fair value hierarchy. It does not include fair value information for financial assets and financial liabilities not
measured at fair value if the carrying amount is a reasonable approximation of fair value.
30 June 2024
Carrying Amount
Fair Value
Consolidated ($000s)
Note
Hedging
instruments
Loans and
receivables
Other
financial
assets/
liabilities
Total
Level 1
Level 2
Level 3
Total
Financial liabilities
measured at fair value
Derivatives
318
-
-
318
-
318
-
318
318
-
-
318
-
318
-
318
Financial assets not
measured at fair value
Trade and other
receivables
B1
-
19,445
-
19,445
-
-
-
-
Cash and cash
equivalents
C5
-
30,520
-
30,520
-
-
-
-
-
49,965
-
49,965
-
-
-
-
Financial liabilities not
measured at fair value
Secured bank loans
C3
-
54,000
-
54,000
-
-
-
-
Trade and other
payables
B7
-
-
61,140
61,140
-
-
-
-
-
54,000
61,140
115,140
-
-
-
-
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
C4 FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT
(CONTINUED)
(a) Fair values (continued)
Recognition and measurement (continued)
2 July 2023
Carrying Amount
Fair Value
Consolidated ($000s)
Note
Hedging
instruments
Loans and
receivables
Other
financial
assets/
liabilities
Total
Level 1
Level 2
Level
3
Total
Financial assets
measured at fair value
Derivatives
915
-
-
915
-
915
-
915
915
-
-
915
-
915
-
915
Financial assets not
measured at fair value
Trade and other
receivables
B1
-
23,202
-
23,202
-
-
-
-
Cash and cash
equivalents
C5
-
31,650
-
31,650
-
-
-
-
-
54,852
-
54,852
-
-
-
-
Financial liabilities not
measured at fair value
Secured bank loans
C3
-
65,000
-
65,000
-
-
-
-
Trade and other
payables
B7
-
-
39,677
39,677
-
-
-
-
-
65,000
39,677
104,677
-
-
-
-
(i) Valuation technique and significant unobservable inputs
The following tables show the valuation techniques used in measuring Level 2 and Level 3 fair values, as well as the
significant unobservable inputs used.
Financial instruments measured at fair value
Type
Valuation technique
Significant unobservable
inputs
Inter-relationship between key
unobservable inputs and fair value
measurement
Forward exchange
contracts
Market comparison technique: Fair value of
forward exchange contracts is determined
using forward exchange rates at the balance
sheet date. These over-the-counter derivatives
utilise valuation techniques maximising the
use of observable market data where it is
available.
None
Not applicable
Financial instruments not measured at fair value
Type
Valuation technique
Significant unobservable inputs
Secured bank loans
Discounted cash flows.
Not applicable.
(ii) Transfers between Level 1 and 2
There were no transfers between Level 1 and Level 2 during the year.
(iii) Level 3 fair values
There were no Level 3 financial assets or liabilities during the year.
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C4 FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT
(CONTINUED)
(b) Financial risk management
The Group has exposure to the following risks arising from financial instruments:
• credit risk (see (b)(ii))
• liquidity risk (see (b)(iii))
• market risk (see (b)(iv))
(i) Risk Management framework
The Company’s Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk
management framework. The Board of Directors has established the Audit, Business Risk and Compliance Committee, which
is responsible for developing and monitoring the Group’s risk management policies. The Committee reports regularly to the
Board of Directors on its activities.
The Group’s risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate
risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed to
reflect changes in market conditions and the Group’s activities. The Group, through its training and management standards
and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their
roles and obligations.
The Audit, Business Risk and Compliance Committee oversees how management monitors compliance with the Group’s risk
management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks
faced by the Group.
The Committee’s specific function with respect to risk management is to review and report to the Board that:
a) the Group’s ongoing risk management program effectively identifies all areas of potential risk;
b) adequate policies and procedures have been designed and implemented to manage identified risks;
c) a regular program of audits is undertaken to test the adequacy of and compliance with prescribed policies; and
d) proper remedial action is undertaken to redress areas of weakness.
(ii) Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its
contractual obligations, and arises principally from the Group’s receivables from customers and deposits placed for leased
outlets.
The Group’s credit risk on its receivables is recognised on the consolidated statement of financial position at the carrying
amount of those receivable assets, net of any provisions for doubtful debts. Receivable balances and deposit balances are
monitored on a monthly basis with the result that the Group’s exposure to bad debts is not considered to be material.
Credit risk also arises from cash and cash equivalents and derivatives with banks and financial institutions. For banks and
financial institutions, only independently rated parties with a minimum rating of ‘A’ are accepted by Lovisa.
At the reporting date, the carrying amount of financial assets recorded in the financial statements, net of any allowances
for impairment losses, represents the Group’s maximum exposure to credit risk. There were no significant concentrations of
credit risk.
Past due but not impaired
As at 30 June 2024, no trade receivables were past due but not impaired (2023: nil). The other classes within trade and
other receivables do not contain impaired assets and are not past due.
(iii) Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities
that are settled by delivering cash or another financial asset. The Group’s approach to managing liquidity is to ensure, as
far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed
conditions, without incurring unacceptable losses or risking damage to the Group’s reputation. Cash flow forecasts are
updated and monitored weekly.
The Group maintains the following lines of credit secured by security interests granted by Lovisa Holdings Ltd and certain
of its subsidiaries over all of their assets in favour of the Commonwealth Bank of Australia (CBA):
• $80 million revolving cash advance facility; and
• $20 million multi option facility available for overdraft, trade finance and a contingent liability facility for global letters
of credit and bank guarantees.
The Group also holds the following lines of credit with the HSBC Bank Australia Limited (HSBC):
• $20 million revolving loan facility; and
• $20 million bank guarantee facility for global letters of credit and bank guarantees
In addition to the above facilities with CBA and HSBC, the Group holds lines of credit in certain of its overseas markets which
are solely for the purpose of providing bank guarantees as security for store lease agreements.
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C4 FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT (CONTINUED)
(b) Financial risk management (continued)
(iii) Liquidity risk (continued)
Exposure to liquidity risk
The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and
undiscounted, and exclude interest payments and the impact of netting agreements.
30 June 2024
Contractual cash flows
Consolidated ($000s)
Carrying
amount
Total
2 mths or
less
2-12 mths
1-2 years
2-5
years
More than
5 years
Non-derivative financial liabilities
Trade payables
33,071
33,071
24,357
8,714
-
-
-
Secured bank loans
54,000
54,000
-
-
-
54,000
-
Lease liabilities
305,067
345,953
10,930
60,815
67,831
141,134
65,243
392,138
433,024
35,287
69,529
67,831
195,134
65,243
Derivative financial liabilities
Forward exchange contracts used for
hedging:
- Outflow
33,320
33,320
8,454
24,866
-
-
-
- Inflow
(33,002)
(33,002)
(8,356)
(24,646)
-
-
-
Total
318
318
98
220
-
-
-
The gross (inflows)/outflows disclosed in the above table represent the contractual undiscounted cash flows relating to
derivative financial liabilities held for risk management purposes and which are usually not closed out before contractual
maturity. The disclosure shows net cash flow amounts for derivatives that are net cash-settled and gross cash inflow and
outflow amounts for derivatives that have simultaneous gross cash settlement.
The future cash flows on trade payables may be different from the amount in the above table as exchange rates change.
Except for these financial liabilities, it is not expected that the cash flows included in the maturity analysis could occur
significantly earlier, or at significantly different amounts.
2 July 2023
Contractual cash flows
Consolidated ($000s)
Carrying
amount
Total
2 mths or
less
2-12 mths
1-2 years
2-5 years
More than
5 years
Non-derivative financial liabilities
Trade payables
19,075
19,075
19,075
-
-
-
-
Secured bank loans
65,000
65,000
-
-
-
65,000
-
Lease liabilities
307,587
348,933
11,705
56,729
62,012
140,562
77,925
391,662
433,008
30,780
56,729
62,012
205,562
77,925
Derivative financial assets
Forward exchange contracts used
for hedging:
- Outflow
42,776
42,776
10,453
32,323
-
-
-
- Inflow
(43,691)
(43,691)
(10,855)
(32,836)
-
-
-
Total
(915)
(915)
(402)
(513)
-
-
-
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C4 FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT
(CONTINUED)
(b) Financial risk management (continued)
(iv) Market risk
Market risk is the risk that changes in market prices – such as foreign exchange rates, interest rates and equity prices – will
affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management is to
manage and control market risk exposures within acceptable parameters, while optimising the return.
The Group uses derivatives to manage market risks. All such transactions are carried out within the guidelines set by the
Audit, Business Risk and Compliance Committee. The Group also applies hedge accounting in order to manage volatility in
profit or loss.
Currency risk
The Group is exposed to currency risk to the extent that there is a mismatch between the currencies in which sales, purchases
and borrowings are denominated and the respective functional currencies of Group companies. The presentation currency
of the Group is the Australian dollar (AUD) which is the functional currency of the majority of Lovisa. The currencies in which
transactions are primarily denominated are Australian dollars, Euro, US dollars, British pounds and South African Rand.
The Company’s foreign exchange policy is aimed at managing its foreign currency exposure in order to protect profit
margins by entering into forward exchange contracts and currency options, specifically against movements in the USD rate
against the AUD because inventory purchases are in USD.
The following table defines the range of cover that has been authorised by the Board relating to purchases over a defined
period:
Exposure
Minimum Hedge Position
Neutral Hedge Position
Maximum Hedge Position
Purchases 0 to 6 months
60%
80%
100%
Purchases 7 to 9 months
40%
50%
75%
Purchases 10 to 12 months
30%
40%
50%
Exposure to currency risk
The summary quantitative data about the Group’s exposure to currency risk as reported to the management of the Group is
as follows:
30 June 2024
2 July 2023
In thousands of
EUR
USD
EUR
USD
Cash and cash equivalents
143
1,117
6
689
Trade receivables
-
1,144
-
922
Trade payables
(1,755)
(15,447)
(1,485)
(11,436)
Net statement of financial position exposure
(1,612)
(13,186)
(1,479)
(9,825)
Sensitivity analysis
A reasonably possible strengthening (weakening) of the USD or EUR against all other currencies would have affected the
measurement of financial instruments denominated in a foreign currency and affected profit or loss by the amounts shown
below. The analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact
of forecast sales and purchases. The translation of the net assets in subsidiaries with a functional currency other than the
Australian dollar has not been included in the sensitivity analysis as part of the equity movement.
There is no impact on reserves in equity as the foreign currency denominated assets and liabilities represent cash, receivables
and payables.
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
C4 FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT
(CONTINUED)
(b) Financial risk management (continued)
(iv) Market risk (continued)
Sensitivity Analysis (continued)
Profit or loss
Effect in thousands of dollars
Strengthening
Weakening
30 June 2024
EUR (5 percent movement)
(81)
81
USD (5 percent movement)
(659)
659
2 July 2023
EUR (5 percent movement)
(74)
74
USD (5 percent movement)
(491)
491
Interest rate risk
The Group is subject to exposure to interest rate risk as changes in interest rates will impact borrowings which bear interest
at floating rates. Any increase in interest rates will impact Lovisa’s costs of servicing these borrowings which may adversely
impact its financial position. This impact is not assessed to be material.
Increases in interest rates may also affect consumer sentiment and the level of customer demand, potentially leading to a
decrease in consumer spending.
Cash flow sensitivity analysis for variable rate instruments
The Group’s debt facilities all have variable interest rates. At 30 June 2024, if interest rates had changed by +/- 100 basis
points from the year end rates with all other variables held constant, there would have been +/- $54,000 impact on pre tax
profit for the year (2 July 2023: $98,000), as a result of higher/lower interest expense from variable rate borrowings. There
is no impact on equity.
(c) Derivative assets and liabilities
The Group holds derivative financial instruments to manage its foreign currency risk exposures.
Recognition and measurement
Derivative financial instruments are recognised initially at fair value; any directly attributable transaction costs are recognised
in profit or loss as they are incurred. Subsequent to initial recognition, derivative financial instruments are measured at fair
value, and changes therein are generally recognised in profit or loss.
Determination of fair values
A number of the Group’s accounting policies and disclosures require the determination of fair value, for both financial and
non-financial assets and liabilities. Fair values have been determined for measurement and / or disclosure purposes based
on the following methods.
Forward rate contracts
The fair value of forward exchange contracts is based on their quoted price, if available. If a quoted price is not available,
then fair value is estimated by discounting the difference between the contractual forward price and the current forward price
for the residual maturity of the contract using a credit-adjusted risk-free interest rate (based on government bonds).
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
C4 FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT
(CONTINUED)
(c) Derivative assets and liabilities (continued)
Forward rate contracts (continued)
The following table provides details of the derivative financial assets and liabilities included on the balance sheet:
2024
2023
Derivatives
Forward exchange contracts
(318)
915
(318)
915
The following table indicates the periods in which the cash flows associated with cash flow hedges are expected to occur
and the carrying amounts of the related hedging instruments.
2024
2023
Expected Cash Flows
Expected Cash Flows
Consolidated ($000s)
Carrying
Amount
Total
12 mths of
less
More than
1 year
Carrying
Amount
Total
12 mths of
less
More than
1 year
Forward exchange
contracts:
Assets
-
-
-
-
915
915
915
-
Liabilities
(318)
(318)
(318)
-
-
-
-
-
(318)
(318)
(318)
-
915
915
915
-
A loss of $115,000 was included in other expenses on foreign currency derivatives not qualifying as hedges (2023: loss
of $78,000).
C5 CASH FLOWS
Recognition and measurement
Cash and cash equivalents comprise cash balances, and cash in transit and call deposits. Bank overdrafts that are repayable
on demand and form an integral part of the entity’s cash management are included as a component of cash and cash
equivalents for the purpose of the statement of cash flows.
Consolidated ($000s)
2024
2023
Bank balances
Cash and cash equivalents in the statement of financial position (i) (ii)
30,520
31,650
Bank overdrafts used for cash management purposes
-
-
Cash and cash equivalents in the statement of cash flows
30,520
31,650
(i) Includes $409,000 (2023: $417,000) of cash in savings accounts to collateralise bank guarantees.
(ii) Includes $9,640,000 (2023: $9,350,000) relating to receivables from credit card merchants for electronic funds
transfers, credit card and debit card point of sale transactions.
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
C5 CASH FLOWS (CONTINUED)
Reconciliation of cash flows from operating activities
Consolidated ($000s)
Note
2024
2023
Cash flows from operating activities
Profit after tax
82,411
68,164
Adjustments for:
Depreciation
93,122
74,224
Impairment (reversals) / charges
2,220
(19)
Gain on remeasurement of lease liability
(535)
(614)
Loss on sale of property, plant and equipment
109
1,181
Share based payments
10,760
25,297
Fair value adjustment to derivatives
C4
115
78
Exchange differences
(7,332)
2,901
180,870
171,212
Change in inventories
(8,524)
(9,884)
Change in trade and other receivables (i)
(3,116)
(2,656)
Change in tax receivables
(11,311)
586
Change in deferred tax assets / (liabilities) (i)
4,921
(3,775)
Change in trade and other payables (i)
23,016
(8,454)
Change in current tax liabilities
401
(6,214)
Change in provisions and employee benefits (i)
1,257
349
Net cash from operating activities
187,514
141,164
(i) Net of changes in balances for non-operating activities.
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
This section includes mandatory disclosures to comply with Australian Accounting Standards, the Corporations Act 2001
and other regulatory pronouncements.
D1 LIST OF SUBSIDIARIES
Set out below is a list of subsidiaries of the Group. All subsidiaries are wholly owned, unless otherwise stated.
Name
Principal place of business
Lovisa Australia Pty Ltd
Australia
Lovisa Pty Ltd
Australia
Lovisa Employee Share Plan Pty Ltd
Australia
Lovisa International Pte Ltd
Singapore
Lovisa Singapore Pte Ltd
Singapore
Lovisa Accessories Pty Ltd
South Africa
DCK Jewellery South Africa (Pty) Ltd
South Africa
Lovisa New Zealand Pty Ltd
New Zealand
Lovisa Malaysia Sdn Bhd
Malaysia
Lovisa UK Ltd
United Kingdom
Lovisa Global Pte Ltd
Singapore
Lovisa Complementos España SL
Spain
Lovisa America, LLC
United States of America
Lovisa France SARL
France
Lovisa Hong Kong Ltd
Hong Kong
Lovisa Germany GmbH
Germany
Lovisa Retail Germany GmbH
Germany
Lovisa Austria GmbH
Austria
Lovisa Belgium BV
Belgium
Lovisa Netherlands BV
Netherlands
Lovisa Switzerland AG
Switzerland
Lovisa Retail France SARL
France
Lovisa Luxembourg SARL
Luxembourg
Lovisa Canada Ltd
Canada
Lovisa Poland sp. Z o.o.
Poland
Lovisa Retail Mexico S.A. DE C.V.
Mexico
Lovisa Retail Namibia (Pty) Ltd
Namibia
Lovisa Italy S.R.L.
Italy
Lovisa Hungary Kft.
Hungary
Lovisa Portugal, Unipessoal LDA
Portugal
Lovisa Retail S.R.L.
Romania
Lovisa Ireland Limited
Ireland
Lovisa Taiwan Limited
Taiwan
O T H E R I N F O R M A T I O N
Lovisa Holdings Limited Annual Report - 30 June 2024
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D2 COMMITMENTS AND CONTINGENCIES
(a) Guarantees
The Group has guarantees outstanding to landlords and other parties to the value of $15,741,000 at 30 June 2024 (2023:
$14,871,000).
(b) Capital commitments and contingent liabilities
The Group is committed to incur capital expenditure of $641,000 at 30 June 2024 (2023: $6,673,000). There are no
contingent liabilities that exist at 30 June 2024 (2 July 2023: none).
N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
D1 LIST OF SUBSIDIARIES (CONTINUED)
Lovisa (Shenzhen) Retail Company Ltd
China
Lovisa Macau Limited
Macau
Lovisa Botswana Propietary Limited
Botswana
Lovisa Fashion Accesories L.L.C.
United Arab Emirates
Lovisa Vietnam Company Limited
Vietnam
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N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T
D3 SHARE-BASED PAYMENT ARRANGEMENTS
The grant-date fair value of equity-settled share-based payment awards granted to employees is generally recognised as
an expense, with a corresponding increase in equity, over the vesting period of the awards. The amount recognised as an
expense is adjusted to reflect the number of awards for which the related service and non-market performance conditions
are expected to be met, such that the amount ultimately recognised is based on the number of awards that meet the related
service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting
conditions, the grant-date fair value of the share-based payment is measured to reflect such conditions and there is no
true-up for differences between expected and actual outcomes.
(a) Descriptions of the share-based payment arrangements and performance rights
The Board has issued share options and performance rights programmes that entitle key management personnel and senior
management to acquire shares in the Company. Under these programmes, holders of vested options are entitled to purchase
shares at the relevant exercise price at the grant date. Currently, these programmes are limited to key management personnel
and senior management.
All options and performance rights are to be settled by physical delivery of shares.
At 30 June 2024 the Group has the following share-based payment arrangements:
(i) Share options and rights programmes (equity-settled)
Long Term Incentives - Annual Programmes (FY 2022)
Share Option
Programme
Grant date
Number of
instruments
(000’s)
Exercise
Price ($)
Contractual life
of options
Vesting conditions
Granted
FY 2022 LTI
(CEO FY22 Tranche 1)
November 2021
-
-
N/A
347,761 Performance Rights vested
during FY23
FY 2022 LTI
(CEO FY22 Tranche 2)
November 2021
-
-
N/A
1,742,857 Performance Rights
vested during the current financial
year
FY 2022 LTI
(CEO FY22 Tranche 3)
November 2021
1,243
-
3 years
Refer CEO Performance Rights
granted table below
FY 2022 LTI
(Exec FY22)
August 2021
60
$14.37
3 years
Refer Executive Performance Options
granted table below
400,000 Performance Rights granted to the CEO under the CEO FY22 Tranche 1 Grant were approved at the Company’s
AGM on 22 November 2021, with 347,671 vested and exercised in FY23 and the remaining 52,329 lapsing unvested.
In July 2022, a further 1,742,857 rights were granted to the CEO under the CEO FY22 Tranche 2 Grant, which vested
and were exercised in full during the current financial year. In July 2023, a further 1,242,995 rights were granted to
the CEO under the CEO FY22 Tranche 3 Grant. Subsequent to the end of the financial year, the Board have determined
that 940,045 of these Performance Rights have vested, with the remaining 302,950 lapsing unvested. Subsequent to
the end of the financial year, the Board also determined that 60,000 Performance Options under the FY2022 Executive
LTI have vested.
Performance Hurdles in relation to Performance Rights Granted to the CEO
Company’s EBIT (pre LTI) for the financial year ending 30 June 2024
% of Performance Rights that vest and become exercisable
$95.0m - $100.0m
8% to 12%
$100.0m - $110.0m
12% to 22%
$110.0m - $125.0m
22% to 43%
$125.0m - $140.0m
43% to 75%
$140.0m to $155.0m
75% to 100%
$155.0m +
100%
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N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T
Performance Hurdles in relation to Performance Options Granted to Other Executives
Group’s EBIT for the financial year ending 30 June 2024
% of LTI Options that vest and become exercisable
Less than $90m
Nil
$90m - $95m
20% awarded
$95m - $100m
35% awarded
$100m - $110m
50% awarded
$110m - $120m
75% awarded
>$120m
100% awarded
D3 SHARE-BASED PAYMENT ARRANGEMENTS (CONTINUED)
(i) Share options and rights programmes (equity-settled) (continued)
(a) Descriptions of the share-based payment arrangements and performance rights
Long Term Incentives - Annual Programmes (FY 2024)
Performance Right
Programme
Grant Date
Number of
Instruments
(000’s)
Exercise
Price ($)
Contractual Life
of Rights
Vesting Conditions
Performance Rights
Granted
FY 2024 LTI
(Executive Tranche 1)
September 2023
11,390
-
1 Year
Refer Performance Rights Granted
table below
FY 2024 LTI
(Executive Tranche 2)
September 2023
11,390
-
2 Years
Refer Performance Rights Granted
table below
FY 2024 LTI
(Executive Tranche 3)
September 2023
11,390
-
3 Years
Refer Performance Rights Granted
table below
34,170
Tranche
End of Performance
Period
Primary Performance Hurdle*
Secondary Performance
Hurdle
Tranche 1
30 June 2024
Growth in Company EBIT for FY24 of between 17.5%
(20% vesting) to 30% (100% vesting) over FY23
(FY24 EBIT Hurdle)
Continued employment at the
vesting date
Tranche 2
29 June 2025
Growth in Company EBIT for FY24 of between 17.5%
(20% vesting) to 30% (100% vesting) over FY23
(FY24 EBIT Hurdle)
Continued employment at the
vesting date
Tranche 3
28 June 2026
Growth in Company EBIT for FY24 of between 17.5%
(20% vesting) to 30% (100% vesting) over FY23
(FY24 EBIT Hurdle)
Continued employment at the
vesting date
During the financial year, 34,170 performance rights were granted to Executives. Subsequent to the end of the financial
year, the Board have determined that based on performance against the FY24 EBIT Hurdle noted below, 43.8% of the
Tranche 1 Executive Performance Rights above have vested, equal to 4,989 Rights, with the remaining 6,402 Performance
Rights lapsing unvested. This vesting percentage will now also be applied to Tranche 2 and 3 vesting, which is based
on continued employment at the end of the relevant performance periods. As a result, a further 12,803 Tranche 2 and 3
Performance Rights have also lapsed unvested subsequent to the end of the financial year.
Lovisa Holdings Limited Annual Report - 30 June 2024
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N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T
D3 SHARE-BASED PAYMENT ARRANGEMENTS (CONTINUED)
(i) Share options and rights programmes (equity-settled) (continued)
(a) Descriptions of the share-based payment arrangements and performance rights (continued)
Long Term Incentives - Annual Programmes (FY 2023)
Performance Right
Programme
Grant Date
Number of
Instruments
(000’s)
Exercise
Price ($)
Contractual Life
of Rights
Vesting Conditions
Performance Rights
Granted
FY 2023 LTI
(Executive Tranche 1)
September 2022
-
-
1 Year
17,919 Performance Rights vested
during the current financial year
FY 2023 LTI
(Executive Tranche 2)
September 2022
17,919
-
2 Years
Refer Performance Rights Granted
table below
FY 2023 LTI
(Executive Tranche 3)
September 2022
17,919
-
3 Years
Refer Performance Rights Granted
table below
35,838
Tranche
End of
Performance
Period
Primary Performance Hurdle*
Secondary Performance Hurdle
Tranche 1
2 July 2023
Growth in Company EBIT for FY23 of between 17.5%
(20% vesting) to 30% (100% vesting) over FY22 (FY23 EBIT
Hurdle)
Continued employment at the
vesting date
Tranche 2
30 June 2024
Growth in Company EBIT for FY23 of between 17.5%
(20% vesting) to 30% (100% vesting) over FY22 (FY23 EBIT
Hurdle)
Continued employment at the
vesting date
Tranche 3
29 June 2025
Growth in Company EBIT for FY23 of between 17.5%
(20% vesting) to 30% (100% vesting) over FY22 (FY23 EBIT
Hurdle)
Continued employment at the
vesting date
* The FY23 EBIT Hurdle is calculated based on growth on FY22 Statutory EBIT adjusted to remove the 53rd week of trading in FY22 to ensure comparability between periods.
The FY23 EBIT Hurdle performance was determined during the current financial year, with the resulting vesting percentage
of 100% for Tranche 1, with this vesting percentage also applied to Tranche 2 and 3 assuming continued employment at
the vesting date for each of those tranches. Subsequent to the end of the current financial year a further 17,919 of Tranche
2 Performance Rights were determined to have vested based on the continued employment of the relevant Executives at
vesting date.
(b) Measurement of fair values
(i) Equity-settled share-based payment arrangements
The fair value of the employee share options (see (a)(i)) have been measured using the Black-Scholes formula. Service and
non-market performance conditions attached to the transactions were not taken into account in measuring fair value.
The inputs used in the measurement of the fair values at grant date of the equity-settled share-based payment plans were as
follows.
FY2021 LTI
FY2022 LTI (EXEC)
Fair value at grant date
$1.25
$2.50
30 day VWAP share price at grant date
$7.15
$14.37
Exercise price
$7.15
$14.37
Expected volatility (weighted-average)
33.70%
33.70%
Expected life (weighted-average)
3 years
3 years
Expected dividends
3.50%
3.50%
Risk-free interest rate (based on government bonds)
0.25%
0.22%
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N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T
(c) Reconciliation of outstanding share options/rights
The number and weighted average exercise prices of share options and performance rights under the share options and
rights programmes were as follows.
Performance Rights
Share Options
Number
Weighted average
remaining life
Number
Weighted average
exercise price
Weighted average
remaining life
000’s
000’s
$
Outstanding at 3 July 2023
1,797
0.2 years
160
9.86
0.9 years
Granted during the year
1,277
-
-
-
-
Forfeited during the year
-
-
-
-
-
Exercised during the year
(1,761)
-
(100)
7.15
-
Outstanding at 30 June 2024
1,313
0.2 years
60
14.37
0.2 years
Exercisable at 30 June 2024
18
-
-
Exercisable at release of the
Group’s full year results
945
60
14.37
Outstanding at 4 July 2022
400
0.2 years
262
10.15
1.3 years
Granted during the year
1,797
-
-
-
-
Forfeited during the year
(52)
-
(77)
10.60
-
Exercised during the year
(348)
-
(25)
10.60
-
Outstanding at 2 July 2023
1,797
0.2 years
160
9.86
0.9 years
Exercisable at 2 July 2023
-
-
-
Exercisable at release of the
Group’s full year results
1,754
100
7.15
D3 SHARE-BASED PAYMENT ARRANGEMENTS (CONTINUED)
(b) Measurement of fair values (continued)
(i) Equity-settled share-based payment arrangements (continued)
Expected volatility has been based on an evaluation of the historical volatility of the Company’s share price.
The fair values of each Performance Rights grant was determined based on the 30 day VWAP of Lovisa shares as of the
relevant grant date as follows
Programme
Fair Value at
Grant Date
FY 2022 LTI (CEO FY22 Tranche 1)
$21.00
FY 2022 LTI (CEO FY22 Tranche 2)
$14.00
FY 2022 LTI (CEO FY22 Tranche 3)
$19.63
FY 2023 LTI (Exec FY23)
$14.00
FY 2024 LTI (Exec FY24)
$19.63
(d) Expenses recognised in profit or loss
For details on the related employee benefit expenses, see Note A3.
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N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T
D4 RELATED PARTIES
(a) Parent and ultimate controlling party
Lovisa Holdings Limited is the parent entity and ultimate controlling party in the Group comprising itself and its subsidiaries.
Subsidiaries of the Group are listed in note D1.
(b) Transactions with key management personnel
(i) Key management personnel compensation
The key management personnel compensation comprised the following:
Consolidated ($000s)
2024
2023
Short-term employee benefits
3,489
3,239
Post-employment benefits
46
48
Share based payment
10,569
25,414
Termination benefits
-
-
Other long term benefits
1,776
2,533
15,880
31,234
Compensation of the Group’s key management personnel includes salaries and non-cash benefits (see Note A3).
Detailed remuneration disclosures are provided in the Remuneration report on pages 23 to 33.
(ii) Key management personnel and Director transactions
A number of key management personnel, or their related parties, hold positions in other companies that result in them having
control or joint control over these companies. There were no transactions or balances outstanding from these related parties
during the period or at 30 June 2024 except for those disclosed in note D4(c) (2 July 2023: nil).
(c) Other related party transactions
Transaction values for the year ended
Balance outstanding as at
Consolidated ($000s)
30 June 2024
2 July 2023
30 June 2024
2 July 2023
a) Expenses
Expense recharges
261
231
-
-
b) Sales
Recharges
-
-
-
-
Included in expenses in the period is $240,000 relating to Directors fees for Brett Blundy in his capacity as Director and
Chairman of the Company. Transactions between the Lovisa Group and BB Retail Capital (BBRC) and its related parties have
been disclosed above due to BBRC continuing to be in a position of holding significant influence in relation to the Group, with
representation on the Board of Directors. Lovisa has, and will continue to benefit from the relationships that its management
team and BBRC have developed over many years of retail operating experience. During the year, BBRC has recharged
expenses relating to travel and conferences attended by Lovisa executives. Expense recharges are priced on an arm’s length
basis. The Group will continue to utilise BBRC’s retail operating experience on an arm’s length basis.
All outstanding balances with other related parties are priced on an arm’s length basis and are to be settled in cash within
two months post the end of the reporting year. None of the balances are secured. No expense has been recognised in the
current year or prior year for bad or doubtful debts in respect of amounts owed by related parties.
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N O T E S T O C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T
D5 AUDITOR’S REMUNERATION
Consolidated ($)
2024
2023
a) KPMG
Audit and review services
Auditors of the Company - KPMG Australia
Audit and review of financial statements
699,980
476,000
Network firms of KPMG Australia
Audit and review of financial statements
290,051
198,000
Total remuneration for audit and review services
990,031
674,000
Other services
Auditors of the Company - KPMG Australia
In relation to other assurance, taxation and due diligence services
44,924
186,970
Network firms of KPMG Australia
In relation to other assurance, taxation and due diligence services
345,373
330,940
Total remuneration for other services
390,297
517,910
Total remuneration of KPMG
1,380,328
1,191,910
b) Non-KPMG audit firms
Audit and review services
Audit and review of financial statements
130,414
26,639
Total remuneration for audit and review services
130,414
26,639
Other services
In relation to other assurance, taxation and due diligence services
132,410
151,121
Total remuneration for other services
132,410
151,121
Total remuneration of non-KPMG audit firms
262,824
177,760
Total auditors remuneration
1,643,152
1,369,670
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
D6 DEED OF CROSS GUARANTEE
Pursuant to ASIC Corporations (Wholly-owned Companies) Instrument 2016/785 issued by the Australian Securities and
Investment Commission, the wholly-owned subsidiaries listed below are relieved from the Corporations Act 2001 requirements
for preparation, audit and lodgement of financial reports, and Directors’ reports.
It is a condition of the Instrument that the Company and each of the subsidiaries enter into a Deed of Cross Guarantee. The
effect of the Deed is that the Company guarantees to each creditor payment in full of any debt in the event of winding up of
any of the subsidiaries under certain provisions of the Corporations Act 2001. If a winding up occurs under other provisions
of the Act, the Company will only be liable in the event that after six months any creditor has not been paid in full. The
subsidiaries have also given similar guarantees in the event that the Company is wound up.
The subsidiaries subject to the Deed are:
• Lovisa Australia Pty Ltd
• Lovisa Pty Ltd
Both of these companies became a party to the Deed on 18 June 2015, by virtue of a Deed of Assumption.
A consolidated statement of profit or loss and other comprehensive income and consolidated statement of financial position,
comprising the Company and controlled entities which are a party to the Deed, after eliminating all transactions between
parties to the Deed of Cross Guarantee, at 30 June 2024 is set out as follows.
Statement of profit or loss and other comprehensive income and retained earnings
Consolidated ($000s)
2024
2023
Revenue
220,970
217,156
Cost of sales
(78,594)
(74,071)
Gross profit
142,376
143,085
Salaries and employee benefits expense
(75,212)
(86,513)
Property expenses
(5,948)
(3,348)
Distribution costs
(2,930)
(1,163)
Depreciation
(20,208)
(18,051)
Gain / (loss) on disposal of property, plant and equipment
52
(46)
Other income and expenses
11,930
11,352
Dividend income
25,249
32,907
Finance income
61
26
Finance costs
(6,081)
(4,345)
Profit before tax
69,289
73,904
Tax expense
(12,257)
(12,621)
Profit after tax
57,032
61,283
Other comprehensive income for the year, net of tax
-
-
Total comprehensive income for the year, net of tax
57,032
61,283
Retained earnings at beginning of year
12,786
16,754
Transfer from reserves
29,306
15,623
Impact of change in accounting policy
-
-
Dividends recognised during the year
(88,851)
(80,874)
Retained earnings at end of year
10,273
12,786
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
D6 DEED OF CROSS GUARANTEE (CONTINUED)
Statement of financial position
Consolidated ($000s)
30 June 2024
2 July 2023
Assets
Cash and cash equivalents
4,371
4,086
Trade and other receivables
65,861
97,199
Inventories
20,229
17,699
Current tax receivables
10,328
-
Derivatives
-
915
Total current assets
100,789
119,899
Deferred tax assets
11,280
14,538
Property, plant and equipment
22,527
21,462
Right-of-use asset
31,482
37,146
Investments
210,119
210,080
Total non-current assets
275,408
283,226
Total assets
376,197
403,125
Liabilities
Trade and other payables
32,636
27,114
Employee benefits - current
3,390
3,045
Derivatives
318
-
Lease liability - current
11,365
13,468
Current tax liabilities
-
42
Provisions - current
708
1,882
Total current liabilities
48,417
45,551
Employee benefits - non-current
1,175
1,013
Lease liability - non-current
27,337
30,053
Loans and borrowings - non-current
54,000
65,000
Provisions - non current
980
750
Total non-current liabilities
83,492
96,816
Total liabilities
131,909
142,367
Net assets
244,288
260,758
Equity
Issued capital
214,852
214,137
Common control reserve
925
925
Share based payments reserve
18,228
32,244
Cash flow hedge reserve
10
666
Retained earnings
10,273
12,786
Total equity
244,288
260,758
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
D7 PARENT ENTITY DISCLOSURES
($000s)
2024
2023
Result of parent entity
Profit for the year
55,249
67,906
Other comprehensive income
-
-
Total comprehensive income for the year
55,249
67,906
Financial position of parent entity at year end
Current assets
39,673
47,702
Non-current assets
210,905
210,905
Total assets
250,578
258,607
Current liabilities
-
-
Non-current liabilities
-
-
Total liabilities
-
-
Net assets
250,578
258,607
Total equity of parent entity comprising of:
Share capital
216,326
215,611
Share based payments reserve
18,228
22,676
Accumulated profits
16,024
20,320
Total equity
250,578
258,607
(a) Parent entity accounting policies
The financial information for the parent entity, Lovisa Holdings Limited, has been prepared on the same basis as the
consolidated financial report, except as set out below.
Investments in subsidiaries
Investments in subsidiaries are accounted for at cost.
(b) Parent entity contingent liabilities
The parent entity did not have any contingent liabilities as at 30 June 2024.
(c) Parent entity guarantees in respect of the debts of its subsidiaries
The parent entity has entered into a Deed of Cross Guarantee with the effect that the Company guarantees debts in respect
of certain subsidiaries. Further details of the Deed of Cross Guarantee and the subsidiaries subject to the deed are disclosed
in Note D6.
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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S
D8 NEW STANDARDS AND INTERPRETATIONS ADOPTED BY THE GROUP
The Group has applied the following standards and amendments for the first time for the annual reporting year ending 30
June 2024:
•
AASB 2023-2 Amendments to Australian Accounting Standards – International Tax Reform – Pillar Two Model Rules;
•
AASB 2021-5 Amendments to Australian Accounting Standards - Deferred Tax related to Assets and Liabilities arising
from a Single Transaction;
•
AASB 2021-2 Amendments to Australian Accounting Standards - Disclosure of Accounting Policies and Definition of
Accounting Estimates;
•
AASB 17 Insurance Contracts; and
•
Disclosure of Accounting Policies - Amendements to IAS1 and IFRS Practice Statement 2
D9 NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTED
A number of new standards are effective for annual periods beginning after 1 July 2024 and earlier application is permitted;
however, the Group has not early adopted the new or amended standards in preparing these consolidated financial
statements.
The following amended standards and interpretations are not expected to have a significant impact on the Group’s
consolidated financial statements:
•
AASB 2020-1 Amendments to Australian Accounting Standards - Classification of Liabilities as Current or Non-
Current;
•
AASB 2022-6 Amendments to Australian Accounting Standards – Non-current Liabilities with Covenants;
•
AASB 2014-10 Amendments to Australian Accounting Standards – Sale or Contribution of Assets between an Investor
and its Associate or Joint Venture;
•
AASB 2023-1 Amendments to Australian Accounting Standards – Supplier Finance Arrangements;
•
AASB 2022-5 Amendments to Australian Accounting standards – Lease Liability in a Sale and Leaseback; and
•
Lack of Exchangeability –Amendments to IAS 21
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C O N S O L I D A T E D E N T I T Y
D I S C L O S U R E S T A T E M E N T
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C O N S O L I D A T E D E N T I T Y D I S C L O S U R E S T A T E M E N T
C O N S O L I D A T E D E N T I T Y
D I S C L O S U R E S T A T E M E N T
Section 295(3A) of the Corporations Act 2001 requires disclosure of the tax residency of each entity included in the
Consolidated Entity Disclosure Statement (CEDS). In the context of an entity which was an Australian resident, “Australian
resident” has the meaning provided in the Income Tax Assessment Act 1997. The determination of tax residency involves
judgement as it is highly fact dependent and there are currently several different interpretations that could be adopted, and
which could give rise to a different conclusion on residency. In determining tax residency, the consolidated entity has applied
the following interpretations:
• Australian tax residency has been assessed based on current legislation and judicial precedent, including having regard
to the Commissioner of Taxation’s public guidance in Tax Ruling TR 2018/5.
• Foreign tax residency has been assessed based on applicable foreign legislation and where available judicial precedent.
Set out below is relevant information relating to entities that are consolidated in the consolidated financial statements at the
end of the financial year as required by the Corporations Act 2021 (s.295(3A)(a)).
As at 30 June 2024, no entities had a different or an additional tax residency from their country of incorporation.
For the year ended 30 June 2024:
Entity Name
Body corporate,
partnership or trust
Place
incorporated/
formed
% of share capital
held directly or
indirectly by the
Company in the body
corporate
Australian or
Foreign tax
resident
Jurisdiction for Foreign
tax resident
Lovisa Holdings Limited
(the Company)
Body corporate
Australia
Australian
N/A
Lovisa Australia Pty Ltd
Body corporate
Australia
100%
Australian
N/A
Lovisa Pty Ltd
Body corporate
Australia
100%
Australian
N/A
Lovisa Employee Share
Plan Pty Ltd
Body corporate
Australia
100%
Australian
N/A
Lovisa International Pte Ltd
Body corporate
Singapore
100%
Foreign
Singapore
Lovisa Singapore Pte Ltd
Body corporate
Singapore
100%
Foreign
Singapore
Lovisa Accessories Pty Ltd
Body corporate
South Africa
100%
Foreign
South Africa
DCK Jewellery South
Africa (Pty) Ltd
Body corporate
South Africa
100%
Foreign
South Africa
Lovisa New Zealand Pty
Ltd
Body corporate
New Zealand
100%
Foreign
New Zealand
Lovisa Malaysia Sdn Bhd
Body corporate
Malaysia
100%
Foreign
Malaysia
Lovisa UK Ltd
Body corporate
United Kingdom
100%
Foreign
United Kingdom
Lovisa Global Pte Ltd
Body corporate
Singapore
100%
Foreign
Singapore
Lovisa Complementos
España SL
Body corporate
Spain
100%
Foreign
Spain
Lovisa America, LLC
Body corporate
United States of
America
100%
Foreign
United States of
America
Lovisa France SARL
Body corporate
France
100%
Foreign
France
Lovisa Hong Kong Ltd
Body corporate
Hong Kong
100%
Foreign
Hong Kong
Lovisa Germany GmbH
Body corporate
Germany
100%
Foreign
Germany
Lovisa Retail Germany
GmbH
Body corporate
Germany
100%
Foreign
Germany
Lovisa Austria GmbH
Body corporate
Austria
100%
Foreign
Austria
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C O N S O L I D A T E D E N T I T Y D I S C L O S U R E S T A T E M E N T
Entity Name
Body corporate,
partnership or trust
Place
incorporated/
formed
% of share capital
held directly or
indirectly by the
Company in the body
corporate
Australian or
Foreign tax
resident
Jurisdiction for Foreign tax
resident
Lovisa Belgium BV
Body corporate
Belgium
100%
Foreign
Belgium
Lovisa Netherlands BV
Body corporate
Netherlands
100%
Foreign
Netherlands
Lovisa Switzerland AG
Body corporate
Switzerland
100%
Foreign
Switzerland
Lovisa Retail France
SARL
Body corporate
France
100%
Foreign
France
Lovisa Luxembourg
SARL
Body corporate
Luxembourg
100%
Foreign
Luxembourg
Lovisa Canada Ltd
Body corporate
Canada
100%
Foreign
Canada
Lovisa Poland
sp. Z o.o
Body corporate
Poland
100%
Foreign
Poland
Lovisa Retail Mexico
S.A. DE C.V.
Body corporate
Mexico
100%
Foreign
Mexico
Lovisa Retail Namibia
(Pty) Ltd
Body corporate
Namibia
100%
Foreign
Namibia
Lovisa Italy S.R.L.
Body corporate
Italy
100%
Foreign
Italy
Lovisa Hungary Kft.
Body corporate
Hungary
100%
Foreign
Hungary
Lovisa Portugal,
Unipessoal LDA
Body corporate
Portugal
100%
Foreign
Portugal
Lovisa Retail S.R.L.
Body corporate
Romania
100%
Foreign
Romania
Lovisa Ireland Limited
Body corporate
Ireland
100%
Foreign
Ireland
Lovisa Taiwan Limited
Body corporate
Taiwan
100%
Foreign
Taiwan
Lovisa (Shenzhen)
Retail Company Ltd
Body corporate
China
100%
Foreign
China
Lovisa Macau Limited
Body corporate
Macau
100%
Foreign
Macau
Lovisa Botswana
Propietary Limited
Body corporate
Botswana
100%
Foreign
Botswana
Lovisa Fashion
Accesories L.L.C.
Body corporate
United Arab
Emirates
100%
Foreign
United Arab Emirates
Lovisa Vietnam
Company Limited
Body corporate
Vietnam
100%
Foreign
Vietnam
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S I G N E D R E P O R T S
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S I G N E D R E P O R T S
1.
In the opinion of the Directors of Lovisa Holdings Limited (‘the Company’):
(a) the consolidated financial statements and notes that are set out on pages 37 to 80 and the Remuneration report in
the Directors’ report, are 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 2024 and of its performance, for
the financial year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable.
2.
There are reasonable grounds to believe that the Company and the group entities identified in Note D6 will be
able to meet any obligations or liabilities to which they are or may become subject to by virtue of the Deed of
Cross Guarantee between the Company and those Group entities pursuant to ASIC Corporations (Wholly owned
Companies) Instrument 2016/785
3.
The Directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the
Chief Executive Officer and Chief Financial Officer for the financial year ended 30 June 2024.
4.
The Directors draw attention to the Basis of Accounting for the consolidated financial statements set out on page 41,
which includes a statement of compliance with International Financial Reporting Standards.
5.
In the Directors’ opinion, the consolidated entity disclosure statement required by section 295(3A) of the Corporations
Act 2001 for the year ended 30 June 2024 is true and correct.
Signed in accordance with a resolution of the Directors.
________________________________________________
Victor Herrero
Chief Executive Officer
Melbourne
26 August 2024
D I R E C T O R S ’
D E C L A R A T I O N
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S I G N E D R E P O R T S
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated
with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and
logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by
a scheme approved under Professional Standards Legislation.
Independent Auditor’s Report
To the shareholders of Lovisa Holdings Limited
Report on the audit of the Financial Report
Opinion
We have audited the Financial Report of
Lovisa Holdings Limited (the Company).
In our opinion, the accompanying Financial
Report of the Company gives a true and
fair view, including of the Group’s
financial position as at 30 June 2024 and
of its financial performance for the year
then ended, in accordance with the
Corporations Act 2001, in compliance with
Australian Accounting Standards and the
Corporations Regulations 2001.
The Financial Report comprises:
• Consolidated statement of financial position as at 30
June 2024.
• Consolidated statement of profit or loss and other
comprehensive income, Consolidated statement of
changes in equity, and Consolidated statement of
cash flows for the year then ended
• Consolidated entity disclosure statement and
accompanying basis of preparation as at 30 June
2024.
• Notes, including material accounting policies
• Directors’ Declaration.
The Group consists of the Company and the entities it
controlled at the year end or from time to time during
the financial year.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Our responsibilities under those standards are further described in the Auditor’s responsibilities for
the audit of the Financial Report section of our report.
We are independent of the Group in accordance with the Corporations Act 2001 and the ethical
requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics
for Professional Accountants (including Independence Standards) (the Code) that are relevant to our
audit of the Financial Report in Australia. We have fulfilled our other ethical responsibilities in
accordance with these requirements.
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S I G N E D R E P O R T S
Key Audit Matters
Key Audit Matters are those matters that, in our professional judgement, were of most significance in
our audit of the Financial Report of the current period.
This matter was 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 this matter.
Recoverability of property, plant and equipment ($123.6 million) and right-of-use assets
($251.4 million)
Refer to Note B3, B4 and B6 to the Financial Report
The key audit matter
How the matter was addressed in our audit
A key audit matter for us was the Group’s
assessment of its property plant and equipment
and right-of-use assets for impairment, given
the size of their balances (being 72% of total
assets). In addition, the Group recorded an
impairment charge of $3,959,000 excluding
reversals against its property plant and
equipment and right-of-use assets for
underperforming stores.
The assessment for impairment indicators is
made at a store-by-store basis as each store is
determined to be a Cash Generating Unit
(CGU). If such indicators exist, the specific
CGU’s recoverable amount is estimated using
the value in use model.
For CGUs for which a value in use model was
prepared, we focussed on the key forward-
looking assumptions the Group applied,
including:
•
forecast operating cash flows and
growth rates – the Group operates in
competitive market conditions,
especially given the current uncertain
retail environment impacting consumer
spending which are anticipated to
continue in the near term in certain
markets. These conditions, increase
the possibility of property, plant and
equipment and right-of-use assets
being impaired.
•
discount rate – these are complicated
in nature because they are required to
reflect the individual trading
environment and the model’s approach
to incorporating the CGU-specific risks
into the cash flows or discount rates.
Our procedures included:
•
We considered the reasonableness of
parameters applied in the impairment
indicator assessment performed by the
Group, and relevant disclosures against the
requirements of the accounting standards.
For CGUs with indicators of impairment:
•
We considered the appropriateness of the
value in use method applied by the Group to
determine recoverable amounts, against the
requirements of the accounting standards.
•
We assessed the integrity of the value in use
models used, including the accuracy of the
underlying calculation formulas.
•
We compared the forecast cash flows
contained in the value in use models to
Board approved forecasts.
•
We assessed the accuracy of previous Group
forecasts to inform our evaluation of
forecasts incorporated in the models by
comparing them to financial results achieved
in the current year.
•
We considered the sensitivity of the models
to changes in key assumptions, such as
forecast growth rates and discount rates,
within a reasonably possible range, to identify
those CGUs at higher risk of impairment, or
those assumptions at higher risk of bias or
inconsistency in application, in order to focus
our further procedures.
•
We challenged the Group’s forecast cash
flow and growth assumptions in light of the
expected continuation of depressed
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S I G N E D R E P O R T S
We involve our valuations specialists
with the assessment.
Given the extensive number of CGUs, the
Group performs many individual impairment
assessments. The models are largely manually
developed, and use adjusted historical
performance and a range of internal and
external sources as inputs to the assumptions
as the basis to estimate forecast cash flows.
The selection of these forward-looking
assumptions is potentially prone to greater risk
for bias, error and inconsistent application.
These conditions necessitate additional scrutiny
by us, in particular to address the objectivity of
sources used for assumptions.
consumer spending. We compared forecast
growth rates, including those implicit in the
year 1 forecast cash flows, to published
studies of industry trends and expectations,
and considered differences for the Group’s
operations. We used our knowledge of the
Group, its past performance, business and
customers, and our industry experience.
•
We checked the consistency of the growth
rates for the respective CGUs to external
indices, past performance of the Group, and
our experience regarding the feasibility of
these in the industry and economic
environment in which they operate.
•
Working with our valuation specialists, we
independently developed a discount rate
range for each CGU subject to recoverable
amount determinations using publicly
available market data for comparable entities,
adjusted by risk factors specific to the
individual CGUs and the retail sector they
operate in, and compared them with the
rates used by the Group.
•
We recalculated the impairment charge and
compared it to the amount recorded by
management.
•
We assessed the disclosures in the financial
report using our understanding obtained from
our testing and against the requirements of
the accounting standards.
Other Information
Other Information is financial and non-financial information in Lovisa Holdings Limited’s annual report
which is provided in addition to the Financial Report and the Auditor’s Report. The Directors are
responsible for the Other Information.
Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not
express an audit opinion or any form of assurance conclusion thereon, with the exception of the
Remuneration Report and our related assurance opinion.
In connection with our audit of the Financial Report, our responsibility is to read the Other
Information. In doing so, we 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.
We are required to report if we conclude that there is a material misstatement of this Other
Information, and based on the work we have performed on the Other Information that we obtained
prior to the date of this Auditor’s Report we have nothing to report.
Lovisa Holdings Limited Annual Report - 30 June 2024
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Responsibilities of the Directors for the Financial Report
The Directors are responsible for:
• preparing the Financial Report in accordance with the Corporations Act 2001, including giving
a true and fair view of the financial position and performance of the Group, and in compliance
with Australian Accounting Standards and the Corporations Regulations 2001
• implementing necessary internal control to enable the preparation of a Financial Report in
accordance with the Corporations Act 2001, including giving a true and fair view of the
financial position and performance of the Group, and that is free from material misstatement,
whether due to fraud or error
• assessing the Group and Company’s ability to continue as a going concern and whether the
use of the going concern basis of accounting is appropriate. This includes disclosing, as
applicable, matters related to going concern and using the going concern basis of accounting
unless they either intend to liquidate the Group and Company or to cease operations, or have
no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objective is:
• 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 Australian Auditing Standards will always detect a material misstatement when it
exists.
Misstatements can arise from fraud or error. They 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 the Financial Report.
A further description of our responsibilities for the audit of the Financial Report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf This description forms part of our
Auditor’s Report.
S I G N E D R E P O R T S
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Report on the Remuneration Report
Opinion
In our opinion, the Remuneration Report
of Lovisa Holdings Limited for the year
ended 30 June 2024, complies with
Section 300A of the Corporations Act
2001.
Directors’ 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 responsibilities
We have audited the Remuneration Report included in
section 9 of the Directors’ report for the year ended 30
June 2024.
Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
KPMG
Trent Duvall
Partner
Melbourne
26 August 2024
S I G N E D R E P O R T S
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S I G N E D R E P O R T S
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated
with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and
logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by
a scheme approved under Professional Standards Legislation.
Lead Auditor’s Independence Declaration under
Section 307C of the Corporations Act 2001
To the Directors of Lovisa Holdings Limited
I declare that, to the best of my knowledge and belief, in relation to the audit of Lovisa Holdings Limited
for the financial year ended 30 June 2024 there have been:
i.
no contraventions of the auditor independence requirements as set out in the
Corporations Act 2001 in relation to the audit; and
ii.
no contraventions of any applicable code of professional conduct in relation to the audit.
PAR_SIG_01
PAR_NAM_01
PAR_POS_01
PAR_DAT_01
PAR_CIT_01
KPMG
Trent Duvall
Partner
Melbourne
26 August 2024
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A S X I N F O M A T I O N
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A S X I N F O R M A T I O N
Additional information required by the ASX Limited Listing Rules and not disclosed elsewhere in this report is set out below.
CORPORATE GOVERNANCE STATEMENT
The Board of Directors of Lovisa Holdings Limited is responsible for the corporate governance of the Group. The Lovisa
Holdings Board of Directors is committed to achieving best practice in the area of corporate governance and business
conduct. Lovisa Holdings Limited’s Corporate Governance Statement outlines the main corporate governance principles
and practices followed by the Group. These policies and practices are in accordance with the ASX Corporate Governance
Council’s Corporate Governance Principles and Recommendations (4th Edition) unless otherwise stated.
Details of the Company’s Corporate Governance Statement as well as key policies and practices and the charters for the
Board and each of its committees are available on the Company’s website (http://www.lovisa.com/shareholder-info/),
including performance against measurable objectives. The Corporate Governance Statement will be lodged with ASX at the
same time that this Annual Report is lodged with ASX.
The Corporate Governance Statement includes details of the main corporate governance practices in place throughout the
reporting period (unless otherwise stated) in relation to the corporate governance principles and recommendations published
by the ASX Corporate Governance Council and are current as at 30 August 2024 and have been approved by the Board.
The Board is comfortable that the practices are appropriate for a Company of Lovisa Holdings’ size.
SHAREHOLDINGS (AS AT 30 AUGUST 2024)
SUBSTANTIAL SHAREHOLDERS
The number of shares held by substantial shareholders and their associates are set out below:
Shareholder
Number
BB Retail Capital Pty Ltd
43,207,500
VOTING RIGHTS
Ordinary shares
Refer to Note C1 in the financial statements.
Options
There are no voting rights attached to options.
Rights
There are no voting rights attached to rights.
Redeemable preference shares
There are no voting rights attached to redeemable preference shares.
Non-redeemable preference shares
There are no voting rights attached to non-redeemable preference shares.
Distribution of equity security holders
Range
Number of equity security holders
Units
% of Issued Capital
1 - 1,000
8,743
2,740,788
2.50
1,001 - 5,000
2,367
5,252,799
4.79
5,001 - 10,000
276
2,037,789
1.86
10,001 - 100,000
218
5,588,818
5.09
100,001 and over
29
94,090,364
85.76
Total
11,633
109,710,558
100.00
The number of shareholders holding less than a marketable parcel of ordinary shares is 260.
A S X A D D I T I O N A L
I N F O R M A T I O N
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A S X I N F O R M A T I O N
Securities Exchange
The Company is listed on the Australian Securities Exchange. The Home exchange is Sydney.
Other information
Lovisa Holdings Limited, incorporated and domiciled in Australia, is a publicly listed company limited by shares.
Twenty largest shareholders
The names of the twenty largest holders of quoted equity securities are listed below:
Name
Number of ordinary
shares held
Percentage of capital held
BB RETAIL CAPITAL PTY LTD
43,207,500
39.38
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
12,786,171
11.65
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
12,416,946
11.32
CITICORP NOMINEES PTY LIMITED
11,913,111
10.86
BNP PARIBAS NOMINEES PTY LTD
2,638,197
2.40
VICTOR HERRERO AMIGO
2,090,528
1.91
NATIONAL NOMINEES LIMITED
1,567,404
1.43
BNP PARIBAS NOMS PTY LTD
1,394,838
1.27
COLOSKYE PTY LIMITED
1,153,005
1.05
MRS VANESSA LOUISE SPEER
927,460
0.85
TRUEBELL CAPITAL PTY LTD
690,000
0.63
MARICH NOMINEES PTY LTD
486,361
0.44
BNP PARIBAS NOMINEES PTY LTD
395,769
0.36
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
270,925
0.25
MOORGATE INVESTMENTS PTY LTD
192,725
0.18
CLYDE BANK HOLDINGS (AUST) PTY LTD
190,006
0.17
CITICORP NOMINEES PTY LIMITED
184,961
0.17
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
178,523
0.16
BNP PARIBAS NOMINEES PTY LTD
169,287
0.15
STORNOWAY NOMINEES PTY LTD
145,000
0.13
Total
92,998,717
84.77
Balance of register
16,711,841
15.23
Grand total
109,710,558
100.00
Number on issue
Number of holders
Options and performance rights issued under the Lovisa Holdings Ltd Long
Term Incentive Plan to take up ordinary shares
1,355,084
5
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N O T E S
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N O T E S
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N O T E S
CORPORATE DIRECTORY
Company Secretary
Chris Lauder, Chief Financial Officer and Company Secretary
Principal Registered Office
Lovisa Holdings Limited
Level 1, 818-820 Glenferrie Road
Hawthorn VIC 3122
+61 3 7042 6440
Location of Share Registry
Link Market Services Limited
Tower 4
727 Collins Street
Melbourne Victoria 3000
+61 3 9615 9800
Stock Exchange Listing
Lovisa Holdings Limited (LOV) shares are listed on the ASX.
Auditors
KPMG
Tower 2, Collins Square
727 Collins Street
Melbourne Victoria 3000
Website
www.lovisa.com