ANNUAL REPORT
CORPORATE
DIRECTORY
MACA LIMITED
ABN 42 144 745 782
DIRECTORS
Geoff Baker
Non-Executive Chairman
Mike Sutton
Chief Executive Officer and
Managing Director
Linton Kirk
Independent Non-Executive Director
Robert Ryan
Independent Non-Executive Director
Sandra Dodds
Independent Non-Executive Director
Nick Marinelli
Independent Non-Executive Director
Peter Gilford
Company Secretary (Joint)
Nick Ward
Company Secretary (Joint)
REGISTERED OFFICE
45 Division Street
WELSHPOOL WA 6106
Telephone (08) 6242 2600
SOLICITORS
Aphelion Legal
Corporate and Commercial Law
PO Box 8250, South Perth,
PERTH WA 6151
AUDITORS
Moore Australia Audit (WA)
Exchange Tower
2 The Esplanade
PERTH WA 6000
SHARE REGISTRY
Computershare Investor
Services Pty Ltd
11 / 122 St Georges Terrace
PERTH WA 6000
STOCK EXCHANGE LISTINGS
MACA Limited shares are
listed on the Australian
Securities Exchange
ASX CODE : MLD
www.maca.net.au
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MACA LIMITED ANNUAL REPORT 2021
CONTENTS
About Us
Corporate Directory
About Us
Operating Businesses
History
Leadership
Board of Directors
Chief Executive Team
Executive Team
Operational Review
Chairman’s Address
Managing Director’s Review of Operations
FY 21 Key Points
Areas of Activity
Performance
Growth Strategy
Financial Review
Operational Review
Environmental, Social & Governance
Directors’ Report
Remuneration Report
Financial Report
Auditor’s Independence Declaration
Corporate Governance Statement Checklist
Directors’ Declaration
Consolidated Statement of Profit or Loss
and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Sections to the Financial Statements
Independent Audit Report
Shareholder Information
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MACA LIMITED ANNUAL REPORT 2021
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ABOUT US
» OUR PURPOSE
Creating Sustainable Futures
» OUR VISION
Be Number 1 in what we do
» CORE VALUES
PEOPLE FIRST
We care for people and create a safe and enjoyable workplace.
We treat them fairly, with integrity, honesty and respect
EXCEED EXPECTATIONS
We strive to exceed expectations of our people, clients and
shareholders
CONTINUOUS IMPROVEMENT
We are committed to being a better business through
continuous improvement and innovation
COMMUNITY
We show leadership and take responsibility for our community
ACCOUNTABILITY
We are personally accountable for delivering on our
commitments. We do what we say
» OUR PROMISE
We Care
We are Flexible
We Deliver
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MACA LIMITED ANNUAL REPORT 2021
Our purpose is
at the heart of
everything we do
It’s about Creating Sustainable
Futures as a business, so we
can improve the lives of our
people and the communities
in which we live and work
MACA LIMITED ANNUAL REPORT 2021
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ABOUT US
OUR OPERATING BUSINESSES
MINING
AUSTRALIA
CRUSHING
MINING
INTERNATIONAL
•
• Modern fleet of surface
mining equipment
•
• Load & haul mining
contracts
•
• Bulk overburden removal
•
• Modern fleet of
drilling equipment
•
• Complete blasting service
utilising latest technology
•
• Expertise in gold, iron ore,
lithium, nickel and other
commodities
• Modern fleet of crushing
•
equipment including
primary jaw crushers,
secondary cone crushers
and tertiary cone crushers
• Complete screening
•
services utilising the
latest technology
with scalping screens,
vibrating and fixed
screens and single,
double and triple deck
screens
• Equipment and
•
operating techniques
are used to meet
client needs in diverse
operating environments
• Load and haul
•
• Drill and blast
•
• International expertise
•
in gold and copper
projects
CIVIL
CONSTRUCTION
INFRASTRUCTURE
MAINTENANCE
MACA
INTERQUIP
•
• Civil bulk earthworks for
the private / resource
sector including mining,
tailings storage facilities,
roads, airstrips, camp
pads, borefields and camp
infrastructure
•
• Public works civil
capabilities include
roads and bridges, bulk
earthworks, aerodromes,
drainage and marine works
• Infrastructure capabilities
•
and experience includes
roads maintenance and
construction, parks
and gardens, specialist
services, verge works,
bridge works and safety
barriers
• Asset management and
•
maintenance segments
in Australia
• Delivering structural,
•
mechanical and piping
projects
• New and refurbished plant
•
and equipment
• Consumables to the
•
mineral processing sector
of the resources industry
• Significant number of low
•
to high lift cranes available
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MACA LIMITED ANNUAL REPORT 2021
HISTORY
FY21 Highlights
$1.2bn revenue
$3.1bn+ work in hand
3,000+ employees
2021
Acquired Mining West business from
Downer Mining
2019
Commenced Crushing for BHP
2016
Acquired MACA Infrastructure
and 60% MACA Interquip
2014
Entered Brazil
2010
Listed on ASX as MACA Limited
2004
Awarded 1st contract with
Regis Resources
2020
Entered Cambodia at the Okvau
Gold Project
2016
Acquired Alliance Contracting
2011
MACA Civil began providing
Civil & Infrastructure services
2007
Awarded 1st Crushing and
Screening contract
2002
Mining and Civil Australia
was founded in WA
MACA LIMITED ANNUAL REPORT 2021
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LEADERSHIP
BOARD OF DIRECTORS
Geoff Baker
Non-Executive Chairman
MAICD
Geoff is a founding shareholder of MACA
and has worked in the mining services
sector for 40 years, with a focus on plant
maintenance and asset management
in both operational and management
positions. Geoff’s previous Executive duties
at the Company included responsibility
for planning, operating strategy, capital
expenditure and delivery of safety and
financial outcomes on all projects.
Linton Kirk
Independent Non-Executive Director
B Eng (Mining), FAusIMM (CP)
Linton has over 40 years’ experience in
mining and earthmoving, covering both
open pit and underground operations in
several commodities. He has held technical,
operational and management positions
in a variety of mining and mining service
companies throughout the world prior to
becoming a consultant in 1997. Mr Kirk
holds a Bachelor of Engineering (Mining)
degree from the University of Melbourne,
is a fellow and Charted Professional of
the Australian Institute of Mining and
Metallurgy and is a graduate of the
Australian Institute of Company Directors.
Nick Marinelli
Independent Non-Executive Director
B Bus, GAICD
Nick has over 35 years’ industry experience
in the Construction, Infrastructure Services
and Utilities sectors. He was the CEO of
Fulton Hogan Australia between 2017
and 2019, during which time he grew the
business into new sectors and geographies,
in addition to leading commercial
acquisition activities, new venture start-
ups, marketing, business development
and technology. Prior to joining Fulton
Hogan in 2009, Nick held senior positions
with Rinker Australia, Cemex Australia,
Pioneer Construction Materials and Pioneer
International, both locally in Australia and
overseas. Nick has a Bachelor of Business
degree and is a graduate member of the
Australian Institute of Company Directors.
He is also a Non-Executive Director of the
Australian Road Research Board.
Mike Sutton
Chief Executive Officer
and Managing Director
BSc in Civil Engineering, MAICD, MAusIMM
Mike is an experienced Civil Engineer
with over 40 years’ experience gained in
various senior roles within the mining and
civil contracting industries, having worked
internationally with more than 20 years
spent in Western Australia. Prior to joining
MACA, Mike held the role of Chief Operating
Officer at Downer EDI Mining for 10 years
successfully growing the business from
a low base. Prior to that Mike held senior
roles with Leighton Contractors and Henry
Walker Eltin. Mike holds a Bachelor of
Science in Civil Engineering.
Sandra Dodds
Independent Non-Executive Director
B Com, FCA, GAICD
Sandra has diverse and extensive global
executive experience gained at ASX 100
and ASX 200 companies, focused on
operations, finance, mergers acquisitions
and corporate services. Sandra has a broad
industrial background which has involved
working in highly regulated environments
in Australia, New Zealand and Asia.
Sandra has a Bachelor of Commerce
degree, is a fellow of Chartered Accountants
Australia and New Zealand and a graduate
from the Australian Institute of Company
Directors. Ms Dodds resigned from MACA’s
board, effective 30 September 2021.
Sandra is a Non-Executive Director at Beca
Group Limited, Snowy Hydro Limited and
Oceana Gold Limited.
Robert Ryan
Independent Non-Executive Director
MIEAust, MAICD
Robert brings over 40 years’ experience in
civil engineering and construction to the
Board. For 10 years he worked at a senior
level for a significant public company
working in engineering services. Prior to
that Robert ran the Western Australian
civil division of that business for 4 years
contributing at a strategic level to the
senior management group whilst the civil
business established itself throughout
Australia. During that time the business
experienced significant growth. Mr Ryan
later accepted a strategic role aligned to
business growth and improvement, working
on specific tasks both in Australia and
overseas, reporting directly to the CEO of
the infrastructure division. Robert was also
a partner in a successful civil earthmoving
business for 12 years.
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MACA LIMITED ANNUAL REPORT 2021
MACA has
strengthened
its Board and
Executive
Management
team during
the year
and is well positioned to
capitalise on a growing
set of oppportunities
MACA LIMITED ANNUAL REPORT 2021
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LEADERSHIP
CHIEF EXECUTIVE TEAM
From L to R: David Greig, Mike Sutton and Peter Gilford
David Greig
Chief Development Officer
Mike Sutton
Chief Executive Officer
and Managing Director
Peter Gilford
Chief Financial Officer
and Company Secretary
B Com, GAICD
BSc in Civil Engineering, MAICD, MAusIMM
B Com, CA, AGIA, ACIS
David has over 20 years’ experience
in international mining, construction,
maintenance, and infrastructure
industries. Early in his career David
worked for OEM’s in Kalgoorlie,
Western Australia and the USA. This
was followed by 12 years as a Regional
General Manager for an international
mining equipment and maintenance
company, spending 6 years working in
Australia and more recently 6 years in
North and South America.
Mike is an experienced Civil Engineer
with over 40 years experience gained
in various senior roles within the
mining and civil contracting industries,
having worked internationally with
more than 20 years spent in Western
Australia. Prior to joining MACA,
Mike held the role of Chief Operating
Officer at Downer EDI Mining for
10 years successfully growing the
business from a low base. Prior to that
Mike held senior roles with Leighton
Contractors and Henry Walker Eltin.
Mike holds a Bachelor of Science in
Civil Engineering.
Peter is a finance professional with
experience in the areas of financial
management, accounting, treasury,
insurance, taxation, debt and equity
funding. He has provided services to
a large number of mining, exploration
and construction companies. Peter
holds a Bachelor of Commerce and a
Graduate Diploma in Applied Corporate
Governance. Peter is a member of the
Institute of Chartered Accountants
in Australia and New Zealand and an
associate member of the Governance
Institute of Australia.
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MACA LIMITED ANNUAL REPORT 2021
EXECUTIVE TEAM
Tim Gooch
General Manager
Mining
Tim is a qualified
mining engineer from
Camborne School of
Mines in the UK. His
30 years in the mining
industry has seen him
work in the UK, South
& West Africa, Canada
and 25 years based
here in Australia.
Mark Davidovic
General Manager
Civil & Infrastructure
Mark is a professional
civil engineer with
over 26 years’
experience in both
resource and public
sector infrastructure
developments. Mark
has held senior
roles with some of
Australia’s largest
servicing companies.
Tony McClure
General Manager
MACA Interquip
Tony for the past 25
years has held senior
management roles
across the oil and gas,
mining, construction,
engineering services
and fabrication
industries.
Blake Stanley
General Manager
Crushing
Blake has spent the last
30 years in crushing
quarrying processing
and the mining industry,
and has held
management positions
for the last 20 years
across a broad range
of commodities with
a number of ASX 100
companies.
Jim Rayner
General Manager
Mine Development
Jim is a mining
engineer with more
that 40 years’
experience in the
mining industry.
Jim has held senior
operational positions
with contracting
companies
delivering open cut,
underground and
crushing services.
Linda Devereux
General Manager
People
Linda has more
than two decades of
experience in HR/
Corporate Services
positions and has
worked across a
diverse range of
private and ASX listed
organisations.
Andrew Smith
General Manager
Commercial
Andy has held senior
commercial roles over
the last 25 years in
Europe, the Americas
and in Western
Australia for both
operators and service
contractors.
Adam Struthers
General Manager
Plant
Throughout Adam’s
25 year career he
has worked for
contractors, hire
companies and OEM’s
in the maintenance
industry. Adam
has over 20 years’
experience in the
mining sector,
including 15 years in
managerial positions.
Barry Criddle
General Manager
Mining
Barry has over
30 years experience
in Mining and
Processing,
predominately in
iron ore in Australia,
with additional
experience in gold
and manganese and
international mining
operations in Europe
and South America.
Lance Matthews
General Manager
HSEQT
Lance has more than
20 years of experience
in both mining and
civil works, and
throughout his career
he has worked in a
variety of senior roles.
Michael Hunt
General Manager
Estimating and
Technical Services
Michael has over 24
years of experience
in estimating and
technical services
within the mining
and civil industries,
and has held senior
roles with mining
contractors for over
15 years.
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MACA LIMITED ANNUAL REPORT 2021
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CHAIRMAN’S
REPORT
MACA values diversity
and inclusivity across all
aspects of our business and
is committed to ensuring
that our workplaces are
free from all forms of
harassment, discrimination
and violence.
GEOFF BAKER
Non-Executive Chairman
Revenue ($m)
Work in Hand ($bn)
3.1
497.9
562.6
665.7
808.0
1.8
1.3
1,173.9
FY17
FY18
FY19
FY20
FY21
$ million
2019
2020
2021
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MACA LIMITED ANNUAL REPORT 2021
It is with great pleasure I present
the MACA Limited (“MACA” or
“the Company”) 2021 Annual Report,
my fi rst in the role of Non-Executive
Chairman.
MACA has seen improved performance
during 2021 in our underlying business
operations, again achieving record
levels of revenue and work in hand,
alongside a positive recovery in our
EBITDA and NPAT margins.
Our financial results before acquisition
costs and Bluff costs were largely in
line with guidance provided to the
market, with revenue of $1,174m and
EBITDA of $162.1m.
I commend our Executive Leadership
Team, led by CEO Mike Sutton, for
demonstrating strong leadership
and commitment over the previous
12 months, and in particular
navigating the Company through the
continuing COVID-19 pandemic. I also
acknowledge all of our managers,
employees and contractors who have
diligently followed the evolving health
advice given by Federal and State
governments across all of our operating
regions, negotiating the numerous
border and travel restrictions.
I express my gratitude to all 3,000 plus
members of our workforce, including
the 700 Mining West employees who
joined us in February 2021, for the
resilience they have demonstrated
and their commitment to working
with our clients to safely deliver our
services. Health and safety remains
the highest priority of MACA, and it is
pleasing to see continued improvement
in our safety statistics, with MACA’s
total recordable injury frequency rate
decreasing by 41% to 3.9 during
the year.
MACA’s acquisition of the Mining West
business significantly enhanced the
Company’s scale and diversity in our
Mining division by adding four projects.
The acquisition has performed in
line with our high expectations since
completion, which is a testament to the
management, project and integration
teams for their hard work.
In November we farewelled Mr Andrew
Edwards as Non-Executive Chairman of
the MACA Board, and welcomed Sandra
Dodds and Nick Marinelli as Non-
Executive Directors, who both bring a
broad range of experience to the MACA
Board, having extensive operational
and management experience across
the Australian infrastructure sectors.
We consider that the positive
market conditions will continue to
persist across the mining and civil
construction sectors, and the Company
is actively pursuing many mining,
civil and infrastructure opportunities.
As previously announced, MACA is
expecting revenue of $1.4 billion in
FY22, of which $1.2 billion is currently
secured.
Your Directors have declared a final
dividend of 2.5 cents per share, taking
the total dividends for the year to 5.0
cents fully franked. This dividend has
been set having regard to the recent
level of earnings and the desire to
retain sufficient funds for equipment
and working capital investments
required to support future projects.
We will continue to position MACA for
future years by pursuing appropriate
organic and inorganic growth
opportunities and diversification.
MACA remains focused on operational
productivity and other initiatives to
improve and protect margins in our
drive to bolster earnings sustainability.
Importantly, the Company’s strong
balance sheet provides MACA with
the capacity to pursue the right
opportunities to achieve its long-term
growth strategy.
MACA’s
acquisition
of the Mining
West business
signifi cantly
enhanced the
Company’s
scale and
diversity
The acquisition has
performed in line with
our high expectations
since completion.
On behalf of the Board, I would like
to take this opportunity to thank our
shareholders, as well as all of MACA’s
other stakeholders, for their continued
support, and in particular our dedicated
people for their commitment and
contribution during the year.
Geoff Baker
Non-Executive Chairman
MACA LIMITED ANNUAL REPORT 2021
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OPERATIONAL REVIEW
REVIEW OF OPERATIONS
It is with great pleasure that I present MACA’s Review of Operations for the
financial year ending 30 June 2021.
Before commenting on the
operational and financial results,
I would like to thank all of our valued
employees and contractors for
their significant contributions this
year. The COVID-19 pandemic still
continues to present challenges for
our workforce with border and travel
restrictions, however our people
continue to respond positively to the
evolving requirements and have made
great contributions to help achieve
another year of strong growth.
The successful acquisition of the
Mining West business, completed in
February 2021, has made a significant
contribution to the strategic
development of the Company,
doubling the size of our Mining
division. This acquisition has provided
MACA with additional geographical
spread, increased scale, capability
and commodity diversification for our
Mining Business.
MACA’s statutory earnings were
impacted by the one-off costs relating
to the Mining West acquisition, in
addition to costs of relating to the
cessation of the Bluff mining project
and other one-off costs relating
to MACA’s discontinued Brazilian
operations.
MACA continues to progress its
diversification and growth strategy,
delivering a strong result with record
revenue and an increase in underlying
earnings.
1 The underlying result is a non-IFRS measure that
is used to assess the underlying performance
of the business, adjusted of one-off items and
discontinued operations. Non-IFRS measures
have not been subject to audit or review.
Financial Year Highlights:
OUR PEOPLE
• 45% increase in revenue to
$1,174 million
• Underlying EBITDA1 increased to
$162.1 million (up 40% on pcp)
• Operating cash flows of
$118.8 million (EBITDA cash
conversion of 85%)
• Cash balance of $122.3 million
• Net debt of $180.2 million
SAFETY
MACA is committed to delivering work
safely and continuously improving our
safety performance.
Creating a safe working environment
for our employees remains our highest
priority. Our total recordable injury
frequency rate is 3.9 at 30 June 2021,
down 41% from 6.6 at 30 June 2020.
MACA was delighted to increase its
employee base by c.700 in the year
with the acquisition of the Mining
West business. In excess of 96% of
the Mining West workforce accepted
employment with MACA.
Notwithstanding the new employees
MACA has successfully added into
the business, COVID continues to
have a major impact on the Mining
and Construction sector’s ability
to source candidates domestically
and locally, and these industries
have experienced unprecedented
competition for labour in FY21.
MACA continues to positively react
to labour market challenges, with
many initiatives underway across the
business, including: rate adjustments,
one-off non-recurring incentive
payments, further investment in
trainees, apprenticeships and
leadership programs, recruitment
bonuses, employee culture surveys,
deployment of a parental leave policy
and increased employer branding on
social media.
3,279
2,381
1,741
1,958
1,388
2017
2018
2019
2020
2021
Our People (including Contractors)
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MACA LIMITED ANNUAL REPORT 2021
In FY21, MACA has made
significant progress on our strategic
vision to become a national,
full service contractor. This has
included a material acquisition,
an organisational restructure,
continued diversification and
progress on legacy issues.
MIKE SUTTON
Review of Operations
Managing Director
2021 Safety TRIFR
2021 Safety LTIFR
6.6
0.2
3.9
0.16
2020
2021
2020
2021
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MACA LIMITED ANNUAL REPORT 2021
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OPERATIONAL REVIEW
FY 21 KEY POINTS
SAFETY (TRIFR)
3.88
(down 41.2% from FY20)
WORKFORCE
(INCL CONTRACTORS)
3,279
(up 26% from FY20)
EBITDA (REPORTED)
$140.4
million
NET PROFIT
AFTER TAX
$20.7
million
REVENUE
$1.2
billion
(up 17% from FY20)
(up from a net loss aft er tax
of $17.4 million in FY20)
(up 45% from FY20)
WORK IN HAND
$3.1
billion at Jun 21
DIVIDEND
5.0
cents per share
CAPITAL
INVESTMENT
$146.7
million
(excluding Mining West acquisition)
(comprising 2.5 cent interim dividend
and 2.5 cent fi nal dividend)
OPERATING
CASH FLOW
$118.8
million
(representing an EBITDA
cash conversion of 85%)
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MACA LIMITED ANNUAL REPORT 2021
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F
MACA welcomed
700 employees
with the acquisition
of the Mining
West business.
MACA continues to
implement a number
of initiatives in order
to attract and retain
it’s workforce.
MACA LIMITED ANNUAL REPORT 2020
16
MACA OFFICES
MINING
MINING WEST SITES
CIVIL & INFRASTRUCTURE
CRUSHING
INTERQUIP
OPERATIONS CEASED
K I M B E R L E Y
1
2
3
4
5
6
7
8
9
10
11
P I L B A R A
W E S T E R N
A U S T R A L I A
12
13
14
15
16
M U R C H I S O N
19 20
21
22
23
G O L D F I E L D S
PERTH
17
W H E AT B E LT
18
OPERATIONAL REVIEW
AREAS OF OPERATION
24 Emerald Resources
Okvau Gold
24
C A M B O D I A
1 MainRoads WA
Kimberley Road Maintenance
2 Pilbara Minerals
Pilgangoora
3 BHP
Mining Area C
Eastern Ridge
WAIO
4
5 Atlas Iron
Sanjiv Ridge
6 Mt Webber Crushing
7 Capricorn Metals
Karlawinda Gold
8 MainRoads WA
Karratha / Tom Price Road
9 FMG
Iron Bridge
10 Eliwana
11 CITIC Pacifi c
Cape Preston
12 Ramelius Resources
Mount Magnet
13 Adaman Resources
Kirkalocka
14 Ansteel
Karara Iron Ore Project
15 16 Fenix Resources
Iron Ridge
17 Ramelius Resources
Edna May
Tampia
18 First Quantum Minerals
Ravensthorpe
19 Regis Resources
Duketon South
Moolart Well
20 Wiluna Mining
Matilda Gold
21 22 Red 5 Limited
King of the Hills
23 The Gruyere Joint Venture
Gruyere Gold Project
17
MACA LIMITED ANNUAL REPORT 2021
MACA INTERQUIP
INFRASTRUCTURE
MAINTENANCE
CIVIL
INTERNATIONAL
CRUSHING
MINING AUSTRALIA
8%
2%
15%
3%
5%
FY21 REVENUE
BY DIVISION
67%
GOLD
GOVERNMENT
LITHIUM
NICKEL
10%
3%
10%
FY21 REVENUE
BY COMMODITY 1
45%
IRON ORE
32%
1 Revenue from continuing operations
(excludes discontinued and ceased operations)
A U S T R A L I A
25
Q U E E N S L A N D
25 Carabella Resources
Bluff Coal
26
V I C T O R I A
MELBOURNE
26 VicRoads
Golf Links Road Upgrade
Western Vic Maintenance
Geelong-Bacchus Marsh
Midland Hwy
Moggs Creek Bridge Replacement
Forrest Apollo Bay Turnout
MACA LIMITED ANNUAL REPORT 2020
18
S
T
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N
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OPERATIONAL REVIEW
REVIEW OF OPERATIONS CONTINUED
PERFORMANCE
REVENUE
EBITDA
NPAT
OPERATING CASH FLOW
9
.
3
7
1
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1
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8
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FY18
FY19
FY20
FY21
FY18
FY19
FY20
FY21
FY18
FY19
FY20
FY21
FY18
FY19
FY20
FY21
WORK IN HAND
DIVIDENDS
NET TANGIBLE ASSETS
NET DEBT / (CASH)
4
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FY18
FY19
FY20
FY21
FY18
FY19
FY20
FY21
FY18
FY19
FY20
FY21
FY19
FY20
FY21
)
3
.
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6
-
(
MOMENTUM FOR GROWTH
• Record revenue $1.2bn in FY21, to increase in FY22
• Commodity, client and service diversification
• Strong balance sheet, disciplined capital management
• 3,000+ valued employees
• Work in hand increased to $3.1bn
• 12.5%+ annualised TSR since listing in 2010
• $11bn pipeline of organic growth opportunities
• Entering MACA’s 20th year of operations
• Acquisition of Mining West now successfully integrated
19
MACA LIMITED ANNUAL REPORT 2021
GROWTH STRATEGY
RUN
EXCELLENT OPERATIONS
Applying continuous improvement to get better at what we do.
• Improve year on year safety performance on all MACA projects
• Apply continuous improvement in productivity and resource allocation to meet or
exceed tendered parameters on all projects
GROW
NEW HORIZONS
Pursue profitable growth in new markets and services.
• Identify and capture sustainable and profitable growth by increasing market share in
existing markets
• Further grow MACA by identifying and successfully entering new geographies / markets
TRANSFORM
MACA OF THE FUTURE
Building the systems and structures that support our growth.
• Clear competitive advantage through efficient and effective people, process and systems
• Improved and sustainable margins delivered through a Digital and Process driven
approach to business activities
MACA LIMITED ANNUAL REPORT 2021
20
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S
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OPERATIONAL REVIEW
REVIEW OF OPERATIONS CONTINUED
FINANCIAL
REVIEW
OVERVIEW
MACA has seen improved
performance during 2021 in our
underlying business operations,
again achieving record levels of
revenue and work in hand, alongside
a positive recovery in our EBIT
and NPAT margins from FY20. Our
underlying financial results were
revenue of $1,173m, EBITDA of
$162.1m ($140.4m reported) and
NPAT of $38.8m ($20.7m reported).
Statutory results included one-off
Mining West acquisition costs, Bluff
cessation costs and other items
considered as one-off in nature,
resulting in a statutory Net Profit
After Tax of $20.7m.
BALANCE SHEET AND GEARING
With an increase in revenue and
assets employed, and following
an equity raising and acquisition
facility to support the Mining West
acquisition, the Group as at 30 June
2021 remains in a strong financial
position with a net debt position of
$180.2m (2020: $73.4 million) and
with cash on hand of $122.3m.
OUTLOOK
The improved performance of
MACA’s enlarged Mining Division
is expected to be maintained in
the coming year as the renewed
focus on operational performance
continues to deliver results. Strong
commodity prices, particular in gold
and iron ore, continue to generate
new opportunities that will support
further growth. The Mining Division
enters FY22 with c.$1.2bn of secured
work in hand and MACA remains well
positioned to add to its record order
book.
Notwithstanding the strong
commodity and sector outlook for
Mining, MACA expects the labour
market to remain tight as COVID-19
restrictions continue to impact on the
sector’s ability to source candidates
domestically and locally. MACA will
continue to positively react to these
challenges, with initiatives underway
across the business as previously
noted.
The Civil and Infrastructure
businesses benefited from increased
activity in the development of new
resource projects in FY21 which
is expected to continue into FY22.
Whilst Victoria continues to remain
challenging due to the impacts and
restrictions of COVID19, the division
remains well positioned. MACA
Interquip entered FY21 with $55m
of work in hand and has recently
received a $37m letter of intent from
Norton Goldfields in relation to the
Binduli North Heap Leach project.
OPERATING CASH FLOW AND
CAPITAL EXPENDITURE
Operating cash flow for the year ended
30 June 2021 was $118.8 million,
with strong operational cash flows in
the second half of the year. Capital
expenditure for the financial year
was $146.7 million, with equipment
purchases funded by a combination of
cash and equipment finance contracts.
This is largely associated with growth
capex for the Karlawinda, Sanjiv Ridge
and Iron Ridge projects, in addition
to the acquisition of the Mining West
business (which was undertaken as an
asset only acquisition, and funded by
a combination of an equity raising and
acquisition loan facility).
DIVIDEND
On 23 August 2021, the Board of
MACA Limited declared a fully franked
final dividend of 2.5c per share with
a record date of 3rd September 2021
and payment date of 17th September
2021. This payout is consistent with
our targeted guidelines and the
Board’s objective to provide a return
to shareholders whilst still retaining
the financial capacity to support our
growth plans. The total dividend paid
during the year was $15.2 million
(2020: $13.4 million).
ORDER BOOK
MACA’s work in hand has increased
substantially over the previous two
years, from $1.3bn at August 2019 to
$3.1bn at August 2021. Our pipeline
of organic growth opportunities of
$11bn across the Mining, Civil &
Infrastructure and Interquip divisions,
of which $3.7bn relate to mining
opportunities with existing clients,
is expected to deliver material
opportunities to MACA, some of which
are anticipated to commence in FY22.
21
MACA LIMITED ANNUAL REPORT 2021
Recent organisational changes have added
management capability and streamlined
reporting processes consistent with our
growing business. These changes are
expected to provide an increased focus
on business opportunities together
with optimising operational delivery.
Improvements to metallurgical coal prices
have enabled significant progress of the
recovery of monies owed to MACA by
Carabella, with the sales process for assets
held as security progressing, and sales
proceeds are expected to cover the carrying
value of outstanding receivables. Any
sales proceeds from the Carabella assets
will have a positive impact on MACA’s
cash flows in FY22. Additionally, the
redeployment of fleet from the Bluff project
late in FY21 to existing MACA projects is
expected to benefit FY22.
FY22 - FY25+ WORK IN HAND RUN-OFF
n
o
i
l
l
i
b
$
1.4
1.2
1
0.8
0.6
0.4
0.2
0
FY22
FY23
FY24
FY25+
MINING
CIVIL & INFRASTRUCTURE
MACA INTERQUIP
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MACA LIMITED ANNUAL REPORT 2020
22
OPERATIONAL REVIEW
REVIEW OF OPERATIONS CONTINUED
OPERATIONAL REVIEW
MACA has structured its business reporting into segments, Mining & Crushing,
Civil Construction & Infrastructure Maintenance and MACA Interquip. I have provided
the highlights of each of the business units below:
MINING AND CRUSHING
Operational activities have grown significantly in mining, with MACA continuing its contract mining operations for
Regis Resources at the Duketon South and Duketon North operations, with Ramelius Resources at the Mount Magnet,
Edna May and Tampia projects, with Pilbara Minerals at the Pilgangoora lithium project, FQM Australia Nickel at the
Ravensthorpe Nickel Project, and for three new projects commencing in FY21 being Capricorn Karlawinda, Fenix Iron Ridge
and Atlas Sanjiv Ridge.
Additionally, MACA has welcomed four new projects following the acquisition of the Mining West business, for Fortescue
Metals Group at the Eliwana project, Karara Mining at the Karara project, Gruyere JV (Gold Fields and Gold Road) at the
Gruyere project and Sino Iron at the Cape Preston project.
Operations ceased for Wiluna Mining at the Matilda project and for Carabella Resources on the Bluff PCI coal project (due to
client voluntary administration).
Internationally, MACA continues to provide mining services at the Okvau Gold Project in Cambodia, which mobilsed
and commenced operations in FY21. This is a credit to a dedicated team who have achieved this successful project
commencement during a pandemic. MACA has ceased all Brazil operations and is currently winding up its in-country entities.
MACA continued to deliver on its crushing contracts for BHP Iron Ore during the year, which included a contract to crush
blast-hole stemming material across its Western Australian Iron Ore operations, a contract to crush and screen up to 12Mtpa
at the Mining Area C operation, and a contract to crush and screen up to 5Mtpa at the Eastern Ridge operations. Additionally,
MACA performed crushing activities for Altas Iron at their Mt Webber operations which ceased in June 2021, for Fortescue
Metals Group at their Iron Bridge and Eliwana operations for stemming material, and minor projects for Regis Resources and
other gold producers.
Project
Client
Location
Services
Commodity
Status
Regis Resources
Duketon Operations
Mount Magnet, Edna May, Tampia Ramelius Resources
Pilgangoora
Ravensthorpe
Karlawinda
Iron Ridge
Sanjiv Ridge
Eliwana
Karara
Gruyere JV
Sino Iron
Okvau
Matilda
Bluff PCI
Mining Area C
Eastern Ridge
WAIO Stemming
Mt Webber
Duketon Operations
Eliwana
Pilbara Minerals
FQM Australia Nickel
Capricorn Metals
Fenix Resources
Atlas Iron
Fortescue Metals Group
Karara Mining
Gold Fields and Gold Road
Cape Preston
Emerald Resources
Wiluna Mining
Carabella Resources
BHP
BHP
BHP
Atlas Iron
Regis Resources
Fortescue Metals
Open Pit Mining Services
Goldfi elds, WA
Open Pit Mining Services
Murchison, WA
Open Pit Mining Services
Pilbara, WA
Open Pit Mining Services
Goldfi elds, WA
Open Pit Mining Services
Pilbara, WA
Open Pit Mining Services
Murchinson, WA
Open Pit Mining Services
Pilbara, WA
Open Pit Mining Services
Pilbara, WA
Open Pit Mining Services
Murchinson, WA
Open Pit Mining Services
Goldfi elds, WA
Open Pit Mining Services
Pilbara, WA
Open Pit Mining Services
Cambodia
Goldfi elds, WA
Open Pit Mining Services
Bowen Basin, QLD Open Pit Mining Services
Pilbara, WA
Pilbara, WA
Pilbara, WA
Pilbara, WA
Goldfi elds, WA
Pilbara, WA
Crushing & Screening
Crushing & Screening
Crushing & Screening
Crushing & Screening
Crushing & Screening
Crushing & Screening
Gold
Gold
Lithium
Nickel
Gold
Iron Ore
Iron Ore
Iron Ore
Iron Ore
Gold
Iron Ore
Gold
Gold
PCI Coal
Iron Ore
Iron Ore
Iron Ore
Iron Ore
Gold
Iron Ore
Ongoing
Ongoing
Ongoing
Ongoing
Ongoing
Ongoing
Ongoing
Ongoing
Ongoing
Ongoing
Ongoing
Ongoing
Ceased
Ceased
Ongoing
Ongoing
Ongoing
Ceased
Ongoing
Ongoing
23
MACA LIMITED ANNUAL REPORT 2021
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MACA LIMITED ANNUAL REPORT 2021
24
OPERATIONAL REVIEW
REVIEW OF OPERATIONS CONTINUED
INFRASTRUCTURE MAINTENANCE
In both Western Australia and Victoria smaller long-term infrastructure works involving road maintenance continued.
MACA was delighted to extend its Main Roads WA Kimberley maintenance contract for five years during FY21.
Project
Western Region
Client
VicRoads
Western Victoria
Location
Services
Commodity
Status
Road & Roadside
Maintenance
Road Maintenance
Various
Government
Ongoing
Government
Local
Government
Ongoing
Completed /
Ongoing
Main Roads WA
Local Shires & Councils
Kimberley, WA
Victoria
Kimberley
Various maintenance
packages
CIVIL CONSTRUCTION
The Civil business continues to contribute to MACA’s growth and diversification, and has benefited from increased scale
of the combined MACA business and a heightened focus on project delivery. MACA’s recent upgrade to R4/B3 conditional
under the National Prequalification Scheme has enabled MACA to participate in and pursue larger road and bridge projects
in capital cities for various road agencies around the country.
During FY21 the Civil division completed a section of the Karratha / Tom Price Road for Main Roads Western Australia, and a
number of works packages for Fortescue Metals Group Ltd, including general earthworks, camp expansion, construction of a
26km mine access road, construction of the explosive facility and further road upgrades. MACA also completed work for Atlas
Iron on the Sanjiv Ridge haul road. The South West Gateway Alliance (of which MACA is a 10% participant) was awarded the
Bunbury Outer Ring Road, a $852 million project to construct a 27km, four-lane, high-standard road from Forrest Highway
near Australind to Bussell Highway, south of Bunbury.
In Victoria, the business has underperformed and as a result the business has recently been restructured and refocused
on core skills. Positively, MACA was selected by Major Road Projects Victoria to undertake the Golf Links Road upgrade in
Langwarrin South along with a number of minor works contracts with VicRoads and local Victorian shires.
Project
Client
Karratha / Tom Price Road
Main Roads WA
Location
Pilbara, WA
Iron Bridge Magnetite Project
Fortescue Metals Group
Pilbara, WA
Hay Street Bridge
Atlas Iron
King of the Hills
South West Gateway Alliance
– Bunbury Outer Ring Road
Main Roads WA
Sanjiv Ridge
Red 5 Limited
Main Roads WA
Perth, WA
Pilbara, WA
Goldfi elds, WA
South West, WA
Golf Links Road Upgrade
Major Road Projects Victoria
Frankston, Vic
Services
Commodity
Status
Road construction and
sealing
General Earthworks, camp
expansion, construction of
a 26km mine access road,
construction of explosive
facility and further road
upgrades
Bridge replacement
Haul Road
General Earthworks
Construct of a 27-Kilometre,
Four-lane, high-standard
road
Pavement rehabilitation,
roundabout upgrade and
road safety improvements
Government
Completed
Iron Ore
Completed
Government
Iron Ore
Gold
Government
Completed
Completed
Completed
Ongoing
Government
Ongoing
25
MACA LIMITED ANNUAL REPORT 2021
MACA INTERQUIP
MACA Interquip was awarded the Engineering Procurement & Construction (EPC) contract for the Red 5 King of the Hills gold
project in FY21, encompassing the KOTH processing facility, equipping of the bore fields, high voltage power distribution,
workshop, warehouse and bulk earthworks. This is in addition to the supply contract previously awarded to MACA Interquip
for the SAG Mill and gyratory crusher.
MACA Interquip also conducted a number of minor projects throughout FY21, including maintenance and support
to Adaman Resources at the Kirkalocka Gold project, support to Capricorn at the Karlawinda Gold project (including
fabrication, steelwork and personnel), in addition to various minor works packages for BHP, Saracen, Wiluna Mining
Corporation, Tropicana JV, Norton Gold and other entities.
Project
King of the Hills
King of the Hills
Client
Red 5 Limited
Red 5 Limited
Location
Goldfi elds, WA
Goldfi elds, WA
Services
SAG Mill and gyratory crusher
Processing facility, equipping of the bore fi elds, high
voltage power distribution, workshop, warehouse and bulk
earthworks
Kirkalocka
Karlawinda
Various
Carosue
Wiluna
Adaman
Resources
Capricorn Metals
BHP
Saracen
Wiluna Mining
Murchinson, WA Maintenance
Pilbara, WA
Fabrication, steelwork
Minor work packages
WA
Goldfi elds, WA Minor work packages
Goldfi elds, WA
Support
Commodity
Gold
Gold
Status
Completed
Ongoing
Gold
Completed
Gold
Iron Ore
Gold
Gold
Completed
Completed
Completed
Completed
MACA LIMITED ANNUAL REPORT 2021
26
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OPERATIONAL REVIEW
ENVIRONMENTAL, SOCIAL
AND GOVERNANCE
MACA recognises the importance of Environmental, Social and Governance (ESG) outcomes in delivering long-term
sustainable performance and shareholder value.
Our purpose is about Creating Sustainable Futures as a business, so we can improve the lives of our people and the
communities in which we live and work.
This means that we actively incorporate ESG outcomes into our risk-based decision-making process, and ensure we
operate responsibly to minimise the impact to our people, our environment, and the communities in which we operate.
As part of our Health, Safety and Environment management system we actively consider the lifecycle aspect to
environmental decision-making to reduce MACA’s environmental footprint. We also ensure that we are exploring
innovative ideas that will result in reducing emission discharges, wastes, energy usage and resource consumption.
Due to growth within our business, we are revising our policies and procedures to ensure that they are in line with the
Global Reporting Initiative (GRI) Standards and the UN Sustainability Goals along with enhancing data collection of
sustainability parameters for clear and transparent reporting in future years.
ENVIRONMENTAL
MACA’s ISO AS/NZS 14001 certified Environmental
Management System provides the framework to enhance
environmental performance. We continued to implement
environmental management plans and procedures to
ensure compliance with all legal and client requirements
regarding important issues such as waste, flora and
fauna, hazardous substances, noise, water and cultural
heritage management. We are pleased to report that there
were no major environmental incidents, prosecutions or
infringements during the reporting year.
MANAGING OUR ENVIRONMENT IMPACTS
MACA recognises that climate change is a complex and
challenging issue. We are committed to working with
our clients to understand climate-related risks and
opportunities to reduce the effects of carbon emissions
across our operations.
ENVIRONMENTAL EMISSIONS
In 2020/2021 MACA completed an assessment of our
statutory Environmental Reporting requirements for our
Australian Operations.
The majority of our operations are under the operational
control of the client who is the registered reporting body,
and as such MACA does not meet the requirements
to report under the National Greenhouse and Energy
Reporting scheme (NGERs) or the National Pollutant
Inventory (NPI). MACA works hard to provide quality
data to our clients to enable them to meet their reporting
obligations.
CARBON EMISSIONS
MACA have adopted the principals, methodology and
emission factors from the NGERs Act 2007 legislation
suite to capture annual emission source data in order to
calculate the carbon emissions that have been directly
generated as a result of our project activities – these are
known as Scope 1 emissions, and they have been reported
to our clients who have included them within their own
facility emission reports.
The primary source of Scope 1 emissions for MACA
operations is diesel fuel used in road registered and
off-road vehicles. Incidental sources of Scope 1 emissions
also can include the used of unleaded petrol, acetylene,
LPG, oils and greases.
Scope 2 emissions are from the purchased electricity
for our offices and are also calculated using the state-
based grid factors from the NGERs legislation for the
appropriate year.
Greenhouse Gas Emissions
FY2020
FY2021
Total Scope 1 CO2-e Tonnes
Total Scope 2 CO2-e Tonnes
2,925
2,888
179
370
27
MACA LIMITED ANNUAL REPORT 2021
DUMP TRUCK ELECTRIFICATION INVESTIGATION
MACA is collaborating with Mitsui, AVL and other global
industry leading battery and engineering companies to
investigate the electrification of dump trucks, including
replacement of diesel driveline with sustainable
alternatives. The current focus is on battery design and
packaging. In parallel, studies are being undertaken
on cycle simulations to ensure that the program is
economic. Preliminary studies indicate that there is an
economic application on certain mining activities.
SAFEAI COLLABORATION
BIODIVERSITY AND LAND MANAGEMENT
0
Significant
Environmental
Incidents
0
Heritage
Breaches
MACA is also collaborating with SafeAI, a Silicon Valley
based company to develop an autonomous proof of
concept at one of our client’s existing operations. SafeAI
is a global autonomous heavy equipment company
focused on retrofitting heavy equipment for autonomous
applications in mining and construction. SafeAI builds
software with advanced, industry-specific AI to enable
equipment owners to upgrade existing machines
into self-operating robotic assets. If this program is
successful, it will enable more efficient operation of
machinery, which will in turn reduce diesel usage and the
resulting emissions.
MACA places great importance on ensuring that
there is minimal impact to the environments in
which we operate. We appreciate and respect
the significance of the cultural heritage sites and
will continue to work with traditional landowners
and our clients to ensure that we don’t disturb or
negatively impact cultural heritage sites around us.
We are proud to report that we have had no
significant environmental incidents or heritage
breaches this financial year, and we will continue
to take the necessary steps to ensure this statistic
remains consistent in the future.
Waste and
Recycling
MACA actively engages in waste and recycling
initiatives on our sites to reduce our environmental
footprint. We have developed and implement
waste management guidelines with the objective to
minimise the generation of waste where possible,
maximise the proportion of waste we reuse or recycle,
avoid creating areas of contamination, abide by all
regulatory requirements for waste management and
dispose of non-recyclable solid waste appropriately.
DRILL STEEL RECYCLING
MACA actively recycles drill consumables across our
mining sites. A payment is received from recyclers for
this initiative, and the money is donated back into the
MACA Cancer 200 Ride for Research charity event.
MACA LIMITED ANNUAL REPORT 2021
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ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONTINUED
GENERAL RECYCLING AND WASTE MINIMISATION
We seek to reuse or recycle as much as possible before sending to landfill or incineration. Recycling on site is undertaken
whenever possible. Sites recycle scrap metals and return waste oils, batteries and tyres to contractors for repurposing or
recycling. Operating in remote areas means we rely on single-use plastic and packaging for many essential items. We are
working to eliminate single-use plastic drinking bottles at our sites and offices.
Paperless
Assessments
Recently, MACA implemented Paperless Assessments which will be rolled out across all divisions by the end of December
2021. This initiative will not only improve efficiency and enable Trainer Assessors to spend more time out in field, but it will
also significantly decrease MACA’s paper usage across all our operations.
Rehabilitation
Rehabilitation work is undertaken on land disturbed by mining or construction activities to ensure it is stable, safe and
suitable for post-closure use. Planning for closure of a work area starts when MACA commences a project and continues
throughout the project life to ensure that the impacts of the project can be managed in an environmentally, socially and
economically responsible manner.
Progressive restoration of disturbed areas helps contribute to a reduction in our client’s financial liabilities.
Water Management
Management of freshwater resources continues to be a core focus area which is an issue that can impact directly on the
environment and the communities in which we operate. While competition for water resources continues to increase
globally due to multiple pressures (particularly climate change, population growth and pollution), MACA recognises the
critical importance of water for community and ecosystem health.
Water is a raw material used in our operations and for site amenities. Depending on the site MACA operates on, the water
we use may be drawn from surface water, groundwater, potable water and recycled water sources. Our focus at all sites is
on reducing our dependency on potable water to limit our impact and increase our resilience to water limitations. We aim
to achieve this by increasing the efficiency with which we use water and maximising our use of recycled water wherever
possible.
Our water usage strategy aims to balance our operational needs while at the same time protecting the quality and quantity
of water remaining in the environment that is available to our host communities. Our ultimate aim is not to use more
water than we need to, to effectively run our operations. At each site, our clients are tracking by source how much water is
extracted, consumed or discharged as part of their licensing conditions.
29
MACA LIMITED ANNUAL REPORT 2021
SOCIAL
HEALTH AND SAFETY
Our focus remains on ensuring that our People, Contractors and Visitors have a healthy and safe work environment,
each and every day.
We have an unrelenting focus on the health and safety of our people within the workplace. We work to actively identify
areas of risk and exposure, and ensure our people are equipped with the latest information, tools and technology to
keep them safe on the job.
Our response to safety is authenticated by our 2021 Cultural Survey, in which our results from our people
overwhelmingly agreed that safety is a priority for our business.
Reduced our TRIFR
FROM6.6
FY 19-20
TO3.88
FY 20-21
Reduced our LTIFR
FROM0.2
FY 19-20
TO0.16
FY 20-21
COVID-19
OUR SAFETY MANAGEMENT FRAMEWORK
The COVID-19 pandemic has caused significant
disruption to our homes and workplaces, and at times
has placed our industry at risk. MACA has adopted all
government guidelines, and has introduced a vaccination
campaign, aimed at encouraging vaccination uptake
amongst all of our workforce. We have been working
closely with our clients to ensure we are implementing
practical solutions to assist with the global and economic
impact that the virus has caused. We have acted swiftly
in coordinating our efforts and utilised new technology
to communicate with our workforce, to ensure our people
are kept up-to-date and safe on the job.
ECONOMIC CONTRIBUTION
MACA makes payments to our 3,000+ employees in
wages and benefits, to our suppliers and contractors, to
our shareholders through dividends, to local, state and
federal governments through our taxes, in addition to
voluntary investments and donations to social projects
across the communities where we operate.
MACA is committed to complying with tax laws in a
responsible manner, to paying and reporting our taxes on
time and to being transparent about the taxes we pay.
The MACA Working Safely Framework is comprised of a
six pillar eighteen element framework, grouped under
the headings of Leadership, Risk Management, Planning,
Support and Documentation, Performance Evaluation and
Continuous Improvement. It defines MACA’s eighteen
Management Standards and aligns with AS4801 and
ISO 45001.
The framework is designed to:
• Integrate with and directly support how we work.
• Ensure workplace risk management processes and risk
controls are implemented and remain effective and
reliable.
• Set clear measurable expectations for leadership at all
levels, especially for those supervising others.
• Provide appropriate business consistency and
support, allowing for efficient knowledge sharing and
improvement across our varied operations.
• Maintain efficient assurance processes that verify and
improve how we operate as a business.
• Continuously strive for project improvement.
Each element of the framework establishes our business
intent which allow for client systems and external
requirements, such as legislation to be mapped and,
as required, incorporated into the MACA Management
System while still meeting business expectations.
MACA LIMITED ANNUAL REPORT 2021
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OPERATIONAL REVIEW
ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONTINUED
SAFETY ADVISORS AND ONGOING DEVELOPMENT PROGRAMS
MACA recognises the importance of the ongoing development of our people to ensure we live up to our “Working Safely”
vision. We have recently introduced a “Safety Advisor Development Pathway” for those within our workforce who are
interested in moving into a Health and Safety role with MACA. This structured pathway ensures participants are equipped
with the correct tools and knowledge to enhance safe practices on any project.
CRITICAL RISK ASSESSMENTS
MACA is committed to our “Working Safely” vision. It’s worn on our sleeve as a permanent commitment to one another.
Our STAR assessments were superseded this year by MACA’s new “Personal Task assessments” which are task and job
specific, and more relevant to the work undertaken across the different business divisions.
Our new Personal Task Assessments are a key part of our Risk Management Framework to achieve our “Working Safely”
vision.
INTRODUCTION OF THE WORKING SAFELY RULES
In 2020, we introduced MACA’s new Safety working culture “Working Safely”. This year, we built on this culture further
and introduced the 10 Working Safely Rules in which we encourage all our employees to live by in their day-to-day work.
These rules are designed to ensure our workforce remain safe on the job.
MENTAL WELLBEING
We engage with our employees and promote a healthy, safe, and balanced lifestyle, in addition to striving to ensure that
our workplaces provide an environment of mutual respect for fellow workers. We recognise the importance of Mental
Health within our workforce, and actively provide resources, manuals, and initiatives across our operations to support
mental wellbeing.
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MACA LIMITED ANNUAL REPORT 2021
OUR PEOPLE
FY21 has presented our people with
many challenges as we navigate
our way through COVID-19, the
integration of the Downer Mining
West acquisition and growth
through new project awards.
It takes a strong culture and strong
leadership to provide the direction
and support that is required to
ensure we meet the expectations of
our clients and shareholders. Our
people are passionate, committed
and driven to succeed.
At MACA we take our value of
“People First” seriously. We strive
to consider this value in our actions
and decision making. We ask a lot
of our people, especially in these
challenging times and in return we
work hard to support them.
FY21 saw the introduction of
MACA’s first company wide
employee engagement survey.
Our aim was to gain a pulse of how
our people feel about MACA and
how we can do better and it was
pleasing that we have managed
to maintain that sense of family,
support, people and care.
In FY21, MACA’s HR Strategy
focused on a number of key pillars
that will enhance and build the
sophistication of our HR processes
and systems, to support our
leaders, and their people.
These pillars included:
Gender Pay Parity
• Organisational Design
– ensuring MACA’s structure is
strategically designed to support
our growth plan
• Organisational Development
– to strengthen leadership
capability
• Systems
– build and implement fit for
purpose people systems
• Attract & Retain
– be creative and flexible in our
approach to attract and retain
talent
Diversity
MACA stands by its Diversity
Policy and prides itself on being
an equal opportunity employer.
We continuously strive to achieve
a more balanced and diverse
workforce where people feel
comfortable and highly engaged.
Gender and indigenous diversity
continue to be a focus for MACA
with a number of initiatives
commencing in FY21 to address
previous gaps.
FY 21
Actual
FY 22
Targets
4%
5%
15%
17%
17%
30%
Indigenous
Australians
Percentage
of Female
Workforce
Percentage
of Female
Directors
A pay parity review was undertaken
in FY21 considering individual
performance, experience, location
of role and the nature of their
role. Several minor discrepancies
were identified and rectified.
Gender pay parity analysis is
undertaken regularly and addressed
immediately where practicable.
Paid Parental Leave Scheme
MACA’s paid parental leave scheme
was approved and implemented
in FY21 providing primary and
secondary carer’s additional
financial support whilst they take
time out to welcome their new
arrivals.
Increase Female Participation
MACA currently has an overall
female participation rate of 15%.
The education of managers within
the business around unconscious
bias has commenced and now
forms part of our future leadership
programs with a view to early
education of new managers.
Increase Indigenous
Participation
MACA’s aim is to have a fair
representation across our business
of indigenous employment and
contracting opportunity. With a
current indigenous participation rate
of 4% across our entire business,
our goal is to improve year on year.
MACA have expanded our supplier
base through mutually beneficial
partnerships with indigenous
contractors in FY21. In addition,
we have built great capability in
the northwest within excess of 8%
indigenous participation on our
civil projects.
MACA LIMITED ANNUAL REPORT 2021
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OPERATIONAL REVIEW
ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONTINUED
COMMUNITY
At MACA, we know that we can make an impact through the contributions and support we give to our communities.
We therefore develop partnership that generate long-term value and support a sustainable future for both our
people and the wider community.
Since our inception, we have donated over $20 million dollars’
worth of charitable donations to our charitable partners.
The Harry Perkins Institute
of Medical Research
Fremantle Dockers
Women’s Team
We have continued our long-term
partnership with the Harry Perkins
Institute of Medical research,
now moving into our 9th year as a
corporate partner and title sponsor for
the Perkin’s main charity event the
MACA Cancer 200 Ride for Research.
This Financial year, we welcomed a
new partnership with the Fremantle
Docker’s Women’s team as the
Club’s official AFLW coaches’ partner.
This partnership symbolises our
business commitment to diversity and
community engagement, now and into
the future.
MACA Cancer 200
Ride for Research
Each year, over 1000 riders complete
a 2-day, 200km ride from Perth
to Mandurah and back, with all
funds raised from the weekend
going towards vital cancer research
initiatives. MACA is proud to be title
sponsor of the ride in it’s 10th year.
The Perth’s Children
Hospital Foundation
We are proud to continue our support
towards PCHF. This year, we have
continued our support towards PCHF
by funding the establishment of WA’s
first paediatric Simulation Training
Fellowship Program.
Working Spirit
We have continued working with
Working Spirit this year, in supporting
a pathway for ADF-Veterans to
transition into mining roles within our
workforce.
Murlpirrmarra Connection
MACA has continued its partnership
with Murlpirrmarra, supporting
Aboriginal youth in remote
communities of WA with educational
opportunities.
We recognise the importance of
supporting different areas of the
community, and we are proudly
affiliated with Youth Focus, West
Australian Symphony Orchestra (the
arts), the Roy Hill Community foundation
and the Starlight foundation.
GOVERNANCE
MACA is committed to a governance culture that aims to protect shareholder rights, enhance disclosure and transparency
(both within the company and to external stakeholders) and facilitates the effective functioning of the board. We
believe that by operating with a strong focus on corporate governance, we will enhance MACA’s sustainable long-term
performance and value creation for all stakeholders.
The Board of Directors are responsible for MACA’s corporate governance framework, which ensures that the Company’s
obligations and responsibilities to its various stakeholders are fulfilled.
The Company’s 2021 Corporate Governance Statement reports on MACA’s governance practices, and during the FY21
reporting period, the Directors believe that MACA’s governance arrangements have been consistent with the fourth
edition of the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations, with
expectations noted where relevant.
MACA has in place charters, policies, and procedures (published on our website) which are reviewed and revised as
appropriate to reflect changes in law and developments in corporate governance. MACA also provides a risk management
framework in accordance with ISO31000: Risk Management Principles and Guidelines, which allows the Group to identify
potential change and manage the associated risks and opportunities, to meet or exceed the organisational strategic and
operational objectives. Additionally, in FY21, MACA delivered its first Modern Slavery Statement.
The Board’s Risk Committee is responsible for monitoring the effectiveness of the Group’s risk management framework.
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MACA Cancer 200 Ride for Research
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34
DIRECTORS’ REPORT
The Directors present their report, together with the financial statements, of the consolidated entity (referred to hereafter as
the ‘consolidated entity’) consisting of MACA Limited (referred to hereafter as the ‘company’ or ‘parent entity’) and the entities
it controlled for the year ended 30 June 2021.
DIRECTORS
DIVIDENDS PAID OR RECOMMENDED
The following persons were directors of MACA Limited during
the whole or part of the financial year and up to the date of
this report:
Dividends that were fully franked and paid or declared for
payment since the end of the previous financial year were as
follows:
Mr (Hugh) Andrew Edwards
(Chairman, Non-Executive Director, resignation effective
7 December 2020)
Mr Mike Sutton
(Chief Executive Office and Managing Director)
Mr Geoffrey Alan Baker
(Resigned as an Executive Director effective 1 October
2020. Commenced as Non-Executive Chairman effective
20 November 2020)
Mr Linton John Kirk (Non-Executive Director)
Mr Robert Neil Ryan (Non-Executive Director)
Sandra Dodds (Commenced effective 6 October 2020,
resignation effective 30 September 2021)
Nick Marinelli (Commenced effective 3 May 2021)
Mr Chris Sutherland (Non-Executive Director,
resignation effective 10th September 2020)
PRINCIPAL ACTIVITIES AND ANY SIGNIFICANT
CHANGES IN NATURE
The Group operates in three businesses and currently
three geographical segments. The business segments are
for the provision of contract mining, civil & infrastructure,
and structural, mechanical and piping (through Interquip)
services to the resource sector. The three geographical
segments being Australia, Brazil and Cambodia. Operations
in Brazil have been discontinued since the prior year and
are presented separately in the table below. Operations in
Cambodia have commenced in the current year.
Interim dividend declared and
paid per ordinary share (cps)
Final dividend declared and
paid per ordinary share (cps)
2020
2021
2.5
2.5
2.5
2.5
The final fully franked dividend was paid on the
17th September 2021
DIVIDEND REINVESTMENT PLAN
There is no dividend reinvestment plan in place.
ENVIRONMENTAL ISSUES
MACA is aware of its environmental obligations with regard
to its principal activities and ensures it complies with all
regulations.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
There have not been any significant changes in the state of
affairs of the Group not otherwise disclosed in this Report or
the Financial Statements.
CHANGES IN CONTROLLED ENTITIES
There were no changes in controlled entities.
EVENTS SUBSEQUENT TO BALANCE DATE
• MACA has awarded Bowen Coking Coal Ltd (ASX:BCB) a
Preferred Bidder Status in the sale process for the Bluff
PCI Mine conducted by FTI Consulting as receivers and
managers and controllers.
• Ms Sandra Dodds has resigned as a Director of the board
effective 30th September 2021.
Other than the items listed above, no other matters or
circumstances have arisen since the full year to 30 June 2021
which significantly affected or may significantly affect the
operations of the Group, the results of those operations, or
the state of affairs of the Group in future financial years.
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MACA LIMITED ANNUAL REPORT 2021
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REVIEW OF OPERATIONS
Ordinary Activities
30 June 2021
30 June 2020
Movement
Revenue
EBITDA
EBIT
Net Profit / (Loss) Before Tax
Net Profit / (Loss) After Tax
Discontinued Operations
Revenue
EBITDA
EBIT
Net Profit / (Loss) Before Tax
Net Profit / (Loss) After Tax
Total
Revenue
EBITDA
EBIT
Net Profit / (Loss) Before Tax
Net Profit / (Loss) After Tax
Other Metrics
Work in Hand
Net Debt (Cash) position
Operating Cash Flow
Earnings per share - basic
Dividends per share (fully franked)
$1,173.9m
$144.1m
$44.9m
$36.4m
$25.2m
$795.8m
$129.5m
$9.3m
$6.1m
$3.6m
48%
11%
383%
497%
600%
30 June 2021
30 June 2020
Movement
–
($3.7m)
($4.7m)
($4.5m)
($4.5m)
$12.2m
($9.1m)
($14.6m)
($13.7m)
($21.0m)
(100%)
(59%)
(68%)
(67%)
(79%)
30 June 2021
30 June 2020
Movement
$1,173.9m
$140.4m
$40.2m
$32.0m
$20.7m
$808.0m
$120.4m
($5.3m)
($7.6m)
($17.4m)
45%
17%
858%
520%
219%
30 June 2021
30 June 2020
Movement
$3,100m
$180.2m
$118.8m
6.2 cents
5.0 cents
$2,320m
$73.4m
$116.6m
(6.7) cents
5.0 cents
34%
146%
3%
193%
MACA LIMITED ANNUAL REPORT 2021
36
DIRECTORS’ REPORT
INFORMATION ON CURRENT DIRECTORS
Mr Mike Sutton
Mr Geoff Baker
TITLE:
Chief Executive Officer and Managing Director
TITLE:
Non-Executive Chairman
QUALIFICATIONS:
BSc in Civil Engineering, MAICD, MAusIMM
QUALIFICATIONS: MAICD
EXPERIENCE AND
EXPERTISE:
Mike is an experienced Civil Engineer
with over 40 years’ experience gained in
various senior roles within the mining and
civil contracting industries, having worked
internationally with more than 20 years spent
in Western Australia. Prior to joining MACA,
Mr Sutton held the role of Chief Operating
Officer at Downer EDI Mining for 10 years
successfully growing the business from a low
base. Prior to that Mike held senior roles with
Leighton Contractors and Henry Walker Eltin.
CURRENT
DIRECTORSHIPS:
Mr Sutton has been a board member of MACA
Limited since 1st June 2020.
FORMER
DIRECTORSHIPS
(IN LAST 3 YEARS):
Nil
SPECIAL
RESPONSIBILITIES:
Mr Sutton is currently a member of the
Board’s Risk Committee.
INTEREST IN
SHARES:
INTEREST IN
PERFORMANCE
RIGHTS:
70,408
785,000 vesting 30 June 2023
EXPERIENCE AND
EXPERTISE:
Mr Baker is a founding shareholder of MACA.
He has extensive experience in planning,
operating strategy, capital expenditure and
delivery of successful safety and financial
outcomes for projects. Mr Baker has worked
in the sector for over 40 years, with a focus on
plant maintenance and asset management.
CURRENT
DIRECTORSHIPS:
Mr Baker has been a board member of MACA
Limited since the 10th of November 2010.
FORMER
DIRECTORSHIPS
(IN LAST 3 YEARS):
Nil
SPECIAL
RESPONSIBILITIES:
Mr Baker is currently a member of the Board’s
Audit Committee, Risk Committee and
Remuneration Committee.
INTEREST IN
SHARES:
INTEREST IN
PERFORMANCE
RIGHTS:
13,613,816
Nil
Mr Linton Kirk
Mr Robert Ryan
TITLE:
Independent Non-Executive Director
TITLE:
Independent Non-Executive Director
QUALIFICATIONS:
B Eng (Mining), FAusIMM (CP)
QUALIFICATIONS:
CP Eng, MIEAust, MAICD
EXPERIENCE AND
EXPERTISE:
Mr Kirk has over 40 years’ experience in
mining and earthmoving, covering both
open pit and underground operations in
several commodities. He has held technical,
operational and management positions
in a variety of mining and mining service
companies throughout the world prior to
becoming a consultant in 1997.
CURRENT
DIRECTORSHIPS:
Mr Kirk has been a board member of MACA
Limited since 1st October 2012.
EXPERIENCE AND
EXPERTISE:
Mr Ryan has extensive civil construction and
engineering experience. That experience
has been at both project and management
levels in construction and asset management.
Mr Ryan worked at a senior level with
Downer EDI for 14 years as EGM Downer
Infrastructure WA for four years then
reporting directly to the CEO of DownerEDI
Infrastructure working on various business
improvement projects nationally and
overseas.
FORMER
DIRECTORSHIPS
(IN LAST 3 YEARS)
Nil
CURRENT
DIRECTORSHIPS:
Mr Ryan has been a board member of MACA
Limited since 18th August 2015.
SPECIAL
RESPONSIBILITIES:
Mr Kirk is currently the Chair of the
Board’s Risk Committee and a member of
the Remuneration Committee, and Audit
Committee.
FORMER
DIRECTORSHIPS
(IN LAST 3 YEARS):
SPECIAL
RESPONSIBILITIES:
Nil
Mr Ryan is currently the Chair of the Board’s
Remuneration Committee and member of the
Audit Committee and Risk Committee.
INTEREST IN
SHARES:
73,256
INTEREST IN
SHARES:
143,750
37
MACA LIMITED ANNUAL REPORT 2021
Mr Nick Marinelli
Ms Sandra Dodds
TITLE:
Independent Non-Executive Director
TITLE:
Independent Non-Executive Director
QUALIFICATIONS: B Bus, GAICD
QUALIFICATIONS: B Com, FCA, GAICD
EXPERIENCE AND
EXPERTISE:
Nick has over 35 years’ industry experience
in the Construction, Infrastructure Services
and Utilities sectors. He was the CEO of
Fulton Hogan Australia between 2017
and 2019, during which time he grew the
business into new sectors and geographies,
in addition to leading commercial
acquisition activities, new venture start-
ups, marketing, business development
and technology. Prior to joining Fulton
Hogan in 2009, Nick held senior positions
with Rinker Australia, Cemex Australia,
Pioneer Construction Materials and Pioneer
International, both locally in Australia and
overseas.
CURRENT
DIRECTORSHIPS:
Mr Marinelli is a Director of the
Australian Road Research Board.
FORMER
DIRECTORSHIPS
(IN LAST 3 YEARS):
SPECIAL
RESPONSIBILITIES:
Citywide North Melbourne Asphalt Pty Ltd,
Fulton Hogan Egis O&M Pty Ltd
Mr Marinelli is currently a member of the
Board’s Audit Committee, Rick Committee
and Remuneration Committee.
INTEREST IN
SHARES:
Nil
Mr Peter Gilford
EXPERIENCE AND
EXPERTISE:
Sandra has diverse and extensive global
executive experience gained at ASX 100
and ASX 200 companies, focused on
operations, finance, mergers acquisitions
and corporate services. Sandra has a broad
industrial background which has involved
working in highly regulated environments in
Australia, New Zealand and Asia. Sandra has
a Bachelor of Commerce degree, is a fellow
of Chartered Accountants Australia and New
Zealand and a graduate from the Australian
Institute of Company Directors.
CURRENT
DIRECTORSHIPS:
Ms Dodds is a Non-Executive Director of
Beca Group Limited, Snowy Hydro Limited
and OceanaGold Limited.
FORMER
DIRECTORSHIPS
(IN LAST 3 YEARS):
SPECIAL
RESPONSIBILITIES:
Australia Road Research Board,
Infrastructure Partnerships Australia
Ms Dodds is currently Chair of the Board’s
Audit Committee and a member of the Risk
Committee and Remuneration Committee.
INTEREST IN
SHARES:
Nil
Mr Nick Ward
TITLE:
Chief Financial Officer / Company Secretary
TITLE:
Company Secretary
QUALIFICATIONS: B Com CA, AGIA, ACG
QUALIFICATIONS: B Com, CA, GradDipCorpGov, GradDipAppFin
EXPERIENCE AND
EXPERTISE:
EXPERIENCE AND
EXPERTISE:
Mr Gilford has significant experience in the
areas of financial management, accounting,
business and taxation services. He has
provided services to a large number of
mining, exploration and construction
companies. Mr Gilford has acted in roles of
Director, Company Secretary and CFO for
a number of privately owned businesses.
Peter is a member of the Chartered
Accountants Australia and New Zealand
and is a member of the Chartered
Governance Institute.
Nick is a finance and governance
professional with experience in the areas
of corporate finance, corporate governance
and accounting. Prior to joining MACA,
Nick spent ten years at EY with a focus on
corporate finance and M&A transactions,
which saw him work at a number of
EY’s international offices. Nick holds a
Bachelor of Commerce degree and has
completed Graduate Diplomas in both
Applied Corporate Governance and Applied
Finance. Nick is a member of the Institute of
Chartered Accountants in Australia and New
Zealand.
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MACA LIMITED ANNUAL REPORT 2020
MEETINGS OF DIRECTORS
The number of directors’ meetings which directors were eligible to attend (including Committee meetings) and the number
attended by each director during the year ended 30th June 2021 were as follows:
Directors’ Meetings
Committee Meetings
Board*
Audit
Remuneration Risk
Number eligible
to attend
Number
attended
Number
eligible
to attend
Number
attended
Number
eligible
to attend
Number
attended
Number
eligible
to attend
Number
attended
Geoff Baker
Mike Sutton
Linton Kirk
Robert Ryan
Sandra Dodds
Nick Marinelli
Andrew Edwards
Chris Sutherland
7
7
7
7
5
2
2
1
7
7
7
7
5
2
2
1
2
2
2
2
1
-
1
1
2
2
2
2
1
-
1
1
2
2
2
2
1
1
1
1
2
2
2
2
1
1
1
1
2
2
2
2
2
-
-
-
2
2
2
2
2
-
-
-
*The Board sitting as a Nomination Committee met twice during the year.
REMUNERATION REPORT
The audited remuneration report is set out on pages 45 to 58
and forms part of this Directors’ Report.
INDEMNIFYING OFFICERS OR AUDITOR
During the financial year the Company paid a premium in
respect of a contract insuring the directors of the Company,
the company secretary and all executive and non-executive
directors of the Company and any related body corporate
against a liability incurred as such a director, company
secretary or executive officer to the extent permitted by the
Corporations Act 2001.
The Company has not otherwise, during or since the end of
the financial year, except to the extent permitted by law,
indemnified or agreed to indemnify an officer or auditor of
the Company or of any related body corporate against a
liability incurred by an officer or auditor. In accordance with a
confidentiality clause under the insurance policy, the amount
of the premium paid to insurers has not been disclosed. This is
permitted under s300(9) of the Corporations Act 2001.
PROCEEDINGS ON BEHALF OF COMPANY
No person has applied for leave of Court to bring proceedings
on behalf of the Company or 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 any part of
those proceedings.
The Company was not a party to any such proceedings during
the year.
ASIC CI 2016/191 ROUNDING OF AMOUNTS
The Company is an entity to which ASIC CI 2106/191 Rounding
of Amounts applies and, accordingly, amounts in the financial
statements and directors’ report have been rounded to the
nearest thousand dollars.
NON-AUDIT SERVICES
No non-audit services were provided during the year by the
auditor to the Company or any related body corporate.
AUDITORS INDEPENDENCE DECLARATION
The auditor’s independence declaration as required under
section 307C of the Corporations Act 2001 is set out on page
49 and forms part of the directors’ report for the financial year
ended 30 June 2021.
RISK
MACA’s risk management framework is embedded within existing
processes and is aligned to the Group’s strategic business
objectives. Given the markets and the geographies in which the
Group operates, a wide range of risk factors have the potential to
affect the achievement of these objectives. For further information
in relation to the Group’s risk management framework, refer to
the Corporate Governance Statement.
Set out below is an overview of the more significant business
risks facing MACA and the approach taken to managing those
risks. The factors identified below are not necessarily listed in
order of importance and are not intended as an exhaustive list of
all the risks and uncertainties associated with the MACA business.
MACA LIMITED ANNUAL REPORT 2021
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DIRECTORS’ REPORT
HEALTH, SAFETY,
SUSTAINABILITY AND
ENVIRONMENT RISK
The industry sectors in
which we operate involve a
high degree of operational
risk. MACA believes it takes
all reasonable precautions
to manage safety and
environmental risks to ensure
the continued sustainability
of the business. However,
there can be no assurance
that the Group will avoid
significant costs, liability
and penalties or criminal
prosecution. This risk is
mitigated by progressively
improving on already high
safety performance standards
across the business and by
maintaining independently
reviewed health and safety,
environmental and quality
certifications.
PROJECT DELIVERY RISK
ORDER BOOK RISK
DEMAND RISK
The execution and delivery of
projects involves judgment
regarding the planning,
development and operation
of complex operating
facilities and equipment.
Some parts of MACA’s
business are involved in
large-scale projects that
may occur over extended
time periods. As a result,
the Group’s operations,
cash flows and liquidity
could be affected if MACA
miscalculates the resources
or time needed to complete
a project, if it fails to meet
contractual obligations, or
if it encounters delays or
unspecified conditions. MACA
maintains a strict project
monitoring regime, proactive
management and decision
making to mitigate project
delivery risks.
Generally in the mining
industry, most contracts
can be terminated for
convenience by the
client at short notice and
without penalty, with the
client paying for all work
completed to date, unused
material and in most cases
demobilisation from the
site and redundancies. As
a result, there can be no
assurance that work in hand
will be realised as revenue
in any future period. MACA
seeks to manage this risk
by being selective in the
contracts that it enters into
and always seeks to extend
contracts where possible
in an effort to maximise its
return on capital.
MACA is a contractor
operating predominantly in
the mining resources and
civil sectors. As a result,
failure to obtain contracts,
delays in awards of contracts,
cancellations or terminations
of contracts, delays in
completion, changes in
economic conditions and the
volatile and cyclical nature
of commodity prices means
that the demand for MACA’s
goods and services can vary
markedly over relatively short
periods. Accordingly, changes
in market conditions could
impact MACA’s financial
performance. The Group
seeks to manage demand risk
as best it can by maintaining
a diversified client base and
commodity mix and having a
proportion of equipment and
labour on hire.
41
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BUSINESS ACQUISITIONS
COMPETITION RISK
CONTRACT PRICING RISK
When MACA acquires a business there
is a risk of not being able to realise
or sustain expected benefits of the
acquisition. The goodwill represents
the amounts paid for the business, less
the fair value of the net assets acquired.
MACA, at least annually, reviews the
carrying value of goodwill and may
incur impairment charges related to
goodwill if the businesses or markets
they serve deteriorate. In addition,
businesses that MACA acquires may
have liabilities that MACA was unaware
of in the course of performing due
diligence investigations. Any such
liabilities may have material adverse
impact on MACA’s business and
financial position. As part of the due
diligence process, MACA thoroughly
reviews all contracts to mitigate the
risk of acquiring onerous contracts
and change in control provisions, and
historic liabilities and integration risks.
The market in which MACA operates is
highly competitive, which may result
in downward pressure on prices and
margins. If MACA is unable to compete
effectively in its markets, it runs the risk
of losing market share. MACA continues
to focus on delivering quality services
to make us a contractor of choice as a
means of mitigating this risk.
COUNTERPARTY RISK
MACA derives its revenue from a
number of customers. In the event that
any of these customers fails to pay,
reduces production or scales back
operations, terminates the relationship,
defaults on a contract or fails to renew
their contract with MACA, this may
have an adverse impact on the financial
performance and/or financial position
of MACA. MACA seeks to manage this
risk by regularly monitoring material
counterparties and its exposures
and seeks additional security when
appropriate.
MACA has a mixed exposure to contract
types. However, if the Group materially
underestimates the cost of providing
services, equipment, or plant, there is
a risk of a negative impact on MACA’s
financial performance. MACA follows a
proven tender review process to reduce
the risk of under-pricing contracts.
CYBER SECURITY
The potential for malicious cyber
security attacks resulting in the misuse
and release of sensitive information
poses and ongoing and real risk to
companies that operate in the 21st
century. MACA continues to progress
its ICT Strategy, of which one initiative
includes the continual review of our
cyber security and ICT maturity. Gaps
and vulnerabilities are addressed on an
ongoing basis.
MACA LIMITED ANNUAL REPORT 2021
42
DIRECTORS’ REPORT
43
MACA LIMITED ANNUAL REPORT 2021
LIQUIDITY RISK
CURRENCY FLUCTUATION
The risk of MACA not being able to meet its financial
obligations as they fall due is managed by maintaining
adequate cash reserves and available borrowing
facilities, as required. Errors or unforeseen changes
in actual and forecast cash flows that then create a
mismatch against the maturity profiles of financial assets
and liabilities could have a detrimental effect on the
Group’s liquidity. The Group’s approach to managing
liquidity is to ensure, as far as possible, that it will always
have sufficient liquidity to meet its liabilities when due,
under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the
Group’s reputation.
PARTNER RISK
MACA, in some cases, may undertake services through
and participate in, joint ventures or partnering/alliance
arrangements. The success of these partnering activities
depends on the satisfactory performance by MACA’s
partners. The failure of partners to meet performance
obligations could impose additional financial and
performance obligations that could cause significant
impact on MACA’s reputation and financial results. MACA
completes due diligence on potential partners prior to
forming any business relationship and regularly monitors
these relationships.
LABOUR COSTS AND AVAILABILITY
Labour represents a significant portion of operating
expenses. In order to compete for work and to service
clients, the Group needs to be able to continue to attract
and retain skilled employees. Consequently, the Group is
exposed to increased labour costs in markets where the
demand for labour is strong. Within more stable labour
markets, the group’s labour costs are typically protected
by rise and fall mechanisms within client contracts, which
help neutralise the impact of rising labour costs.
As a Group with international operations, MACA is exposed
to fluctuations in the value of the Australian dollar versus
other currencies. As MACA’s consolidated financial results
are reported in Australian dollars, if MACA generates sales
or earnings or has assets and liabilities in other currencies,
the translation into Australian dollars for financial reporting
purposes can result in a significant increase or decrease in
the amount of those sales or earnings and net assets. MACA
uses cash backed deposits to mitigate some of the US dollar
currency risk. Currently the company has unhedged exposure
to the Brazilian Real, in addition to United States Dollars
(Cambodian Mining Contract).
Other material risks that could aff ect
MACA include:
• Public liability risk incurred maintaining
road assets requiring identified defects
to be closed out within a specified
timeframe;
• A major operational failure or disruption at
key facilities or to communication systems
which interrupt MACA’s business;
• Changing government regulation including
tax, occupational health and safety, and
changes in policy and spending;
• Loss of reputation through poor project
outcomes, unsafe work practices,
unethical business practices, and not
meeting the market’s expectation of its
financial performance;
• Operating in international markets,
potentially exposing MACA to country
specific adverse economic conditions,
civil unrest, conflicts, bribery and corrupt
practices;
• Interest rates in the ordinary course of
business; and
• Loss of key Board, management or
operational personnel.
MACA LIMITED ANNUAL REPORT 2021
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DIRECTORS’ REPORT
REMUNERATION REPORT
Section
Title
Description
Section 1
Introduction
Outlines the scope of the Remuneration Report and the individuals disclosed.
Section 2
Remuneration Governance
Describes the role of the board, the Remuneration Committee and matters
considered (including external advice) when making remuneration decisions.
Section 3
2021 Executive remuneration
framework and improvements
Outlines the 2021 remuneration framework and changes to remuneration plans.
Section 4
Company performance and the
link to remuneration
The outcomes of the key business metrics and hurdles that are used for measuring
variable pay outcomes.
Section 5
Executive remuneration
outcomes
Provides Chief Executive officer remuneration, Short Term Incentive (STI) and Long
Term Incentive (LTI) Plan details and Executive remuneration outcomes for the year.
Section 6
Executive contracts
Appointments and notice periods for current and former Key Management
Personnel.
Section 7
Non-Executive Directors’ fees
Provides detail regarding the fees paid to Non-Executive Directors.
1.0 INTRODUCTION
This remuneration Report forms part of the Directors’ Report for 2021 and outlines the remuneration strategy and
arrangements for the Company’s Directors and Executives (together “Key Management Personnel” or “KMP”) in
accordance with section 300A of the Corporations Act.
1.1 KEY MANAGEMENT PERSONNEL
The KMP of the Group during and since the end of the financial year comprise the company directors (as detailed in the
beginning of the Directors’ Report) and the following three executives, defined as CEO, COO and CFO. Except as noted,
these persons held their current position for the whole of the financial year and since the end of the financial year.
Period in position during the year
Part Year (Retired as Chairman
19 November 2020, and as Director
7 December 2020)
(Full Year, commenced as Chairman on
20 November 2021)
Full Year
Full Year
Commenced 6th of October 2020
Commenced 3rd of May 2021
Resigned 10 September 2020
Person
Position
Directors - Non-Executive
Andrew Edwards
Non-Executive Chairman
Non-Executive Director,
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Geoff Baker
Linton Kirk
Robert Ryan
Sandra Dodds
Nick Marinelli
Chris Sutherland
Directors - Executive
Mike Sutton
Executives
David Greig
Peter Gilford
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MACA LIMITED ANNUAL REPORT 2021
Chief Executive Officer / Managing Director
Full Year
Chief Operating Officer
Chief Financial Officer / Company Secretary
Full Year
Full Year
2.0 REMUNERATION GOVERNANCE
The Board oversees the remuneration arrangements of the KMP.
In performing this function the Remuneration Committee reviews the remuneration packages of all Directors, the Chief
Executive Officer and other Executives (collectively the KMP).
The Committee makes recommendations to the Board on an annual basis with benchmarking against comparable industry
packages and adjusting to recognise the specific performance of both the company and the individual.
The Remuneration Committee may also engage an external remuneration consultant to review the levels of senior executive
and non-executive remuneration. The Remuneration Committee engaged independent third party consultants in the year, in
relation to Non-Executive Director fee benchmarking and incentive design.
3.0 2021 EXECUTIVE REMUNERATION FRAMEWORK
Remuneration practices are continuously developed in line with the Company’s business demands, industry conditions
and overall market trends. The primary goal is to link executive remuneration with the achievement of MACA’s business
and strategic objectives with the aim to increase shareholder value over the short and longer term. The nature and
amount of compensation for executive KMP is designed to retain and stimulate individuals on a market competitive basis.
Remuneration Framework
Total fi xed remuneration (TFR)
Short-term incentive (STI)
Long-term incentive (LTI)
• TFR takes into account similar
positions in peer companies,
length of service, experience and
contribution
• Peer companies are those with
broadly similar revenue and in
related industries
• TFR is reviewed annually
Financial metrics comprise some or all of:
• Net profit after tax - company and divisional
• Earnings per share
Non-financial metrics comprise some or all of:
• Safety indicators - LTI and TRIFR
• Personal performance
• Maximum STI is 15 - 60% of TFR depending on
the individual
• Relative TSR using a benchmark
index namely the S&P/ASX
Small Ordinaries Accumulation
Index (XSOAI) measured over a 3
year period (100% component)
• Number of performance rights
issued up to 50% of fixed annual
remuneration divided by the
independently assessed value of
a performance right
4.0 COMPANY PERFORMANCE AND THE LINK TO REMUNERATION
Key Performance Indicators (‘KPIs’) for both short term and long-term Executive incentive schemes are linked to
the Company’s strategic and business objectives and as a result, pay outcomes are directly aligned with Company
performance against these objectives.
The following Company performance measures are among those that may be included in incentive plans for relevant
executives. KPIs may be adjusted for individually large or unusual items to derive an underlying performance measure
outcome. The Board believes these KPIs are aligned to Shareholder wealth and returns to investors.
MACA LIMITED ANNUAL REPORT 2021
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REMUNERATION REPORT CONTINUED
4.0 COMPANY PERFORMANCE AND THE LINK TO REMUNERATION (CONTINUED)
Reported net profit/(loss) attributable to equity
holders of the parent ($m)
Reported return on equity (%)
Reported basic earnings per share (cents)
Lost time injury frequency rate (LTIFR)
Total recordable injury frequency rate (TRIFR)
Shareholders’ Wealth
Interim dividend declared (cents)
Final dividend declared (cents)
Special dividend declared (cents)
Share price at 30 June (cents)
Total shareholder return (TSR %) 1
3 year Annual Compound TSR 1
2021
18.9
4.9
6.2
0.2
3.9
2.5
2.5
-
76.0
(6.4)
(9.1)
2020
(17.9)
(5.8)
(6.7)
0.2
6.6
2.5
2.5
-
86.5
1.7
(14.1)
2019
20.6
2018
23.6
6.9
7.7
0.5
6.4
2.0
2.5
-
90
7.4
9.1
-
6.8
3.0
3.5
-
120
(21.3)
(5.2)
(23.3)
23.2
2017
31.2
11.6
13.7
-
7.8
4.5
4.5
-
165
38.1
6.3
1
All dividends in the TSR (Total Shareholder Return) calculations are on a declared (rather than paid) basis in respect to each
financial year.
5.0 EXECUTIVE REMUNERATION OUTCOMES
5.1 MANAGING DIRECTOR AND CEO ARRANGEMENTS
Mr Sutton’s remuneration package as CEO was determined by benchmarking it against that paid to CEOs in similar
organisations. The remuneration package comprises the following components:
- Total Fixed Remuneration (TFR) is $706,500 per annum inclusive of superannuation.
- An STI which includes the opportunity to earn an annual cash bonus of up to 60% of total fixed remuneration, subject
to achieving performance hurdles. Mr Suttons’ STI plan has been aligned with other senior executives under similar
plan rules with KPIs that align to profitable performance and safety. The CEO’s STI Plan comprises 40% for key financial
KPI’s, 30% for safety KPI’s and 30% for personal KPI’s. The financial KPIs comprise Net Profit after Tax and Earnings per
Share growth. The safety KPIs are based on the Lost Time Injury Frequency Rate (LTIFR) and the Total Recordable Injury
Frequency Rate (TRIFR).
There was no STI payable for Mr Sutton for 2021 - refer 5.4 below.
- An LTI under which Mr Sutton may receive share performance rights convertible into fully paid shares, subject to
performance criteria being met.
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MACA LIMITED ANNUAL REPORT 2021
5.2 TOTAL FIXED REMUNERATION (TFR)
All Executives received TFR as outlined in page 53 of this report. TFR comprises base salary and superannuation plus the
use of a company motor vehicle or motor vehicle allowance.
Fixed pay has been reviewed and set against peer companies with whom MACA competes. MACA also benchmarks
through industry surveys and reports and may seek external advice for KMP remuneration.
5.3 SHORT-TERM INCENTIVE PLAN (STI PLAN)
Key features of the STI Plan are outlined in the table below.
Objective
KPIs are set to encourage a profit and safety driven culture with the ultimate aim of driving
Stakeholder returns. The STI payments are structured to recognize and motivate employees to
align their performance with the Company’s goals. The amount of bonus actually earned will
depend on performance against predetermined KPIs with payment commencing upon reaching
those hurdles.
Eligibility
All Executive key management personnel.
At risk payments
2020: The STI is a component of ‘at risk’ pay provided to Executives and KMP.
% of TFR paid on Target Achievement
CEO
Executive Directors
Other Executive KMP
25% - 60%
25%
15%
2021: The STI is a component of ‘at risk’ pay provided to Executives and KMP.
% of TFR paid on Target Achievement
CEO
COO and CFO
Other Executive KMP
25% - 60%
25%
15%
Performance conditions Financial and safety targets are all agreed with the Board and personal KPIs are set in
consultation with the relevant Executive.
Each KPI is weighted according to its importance in driving profitable performance and returns to
Shareholders. In order to be eligible to receive an STI there is a minimum financial requirement
or gate which must be met before other KPI’s are considered.
KPIs for the CEO include Earning per Share (EPS), Net Profit after Tax (NPAT), Lost Time
Injury Frequency Rate (LTIFR), Total Recordable Injury Frequency Rate (TRIFR) and personal
assessment.
KPIs for other KMP include Net Profit after Tax (NPAT), business operating unit profit
performance, Lost Time Injury Frequency Rate (LTIFR), Total Recordable Injury Frequency Rate
(TRIFR) and personal assessment.
Setting of KPIs
Financial and safety targets are all agreed with the Board and personal KPIs are set in
consultation with the relevant Executive.
Assessment of KPIs
Performance is measured quantitatively and progress against key targets measured at half year
and full year.
Trigger for payment
Any performance target met will trigger the calculation of total or part payment of the STI’s.
The board may exercise its discretion in relation to the payment of STI’s.
Cessation of employment STI forfeited if an Executive or KMP resigns or is terminated before the payment date. In
exceptional circumstances this may be reviewed by the Board.
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B
A
P
I
H
S
R
E
D
A
E
L
W
E
I
V
E
R
L
A
N
O
I
T
A
R
E
P
O
T
R
O
P
E
R
’
S
R
O
T
C
E
R
I
D
T
R
O
P
E
R
L
A
I
C
N
A
N
I
F
DIRECTORS’ REPORT
REMUNERATION REPORT CONTINUED
5.4 STI OUTCOMES
No STI was paid to any member of the senior executive team.
5.5 LONG-TERM INCENTIVE PLAN (LTI PLAN)
Key features of the LTI Plan are outlined in the table below.
Overview of the LTI Plan The Plan offers Executive KMP performance rights with the opportunity to receive fully paid
ordinary shares in MACA Limited for no consideration, subject to specified time restrictions,
continued employment and performance conditions being met. Each performance right will
entitle participants to receive one fully paid ordinary share at the time of vesting.
Objective
The Plan is designed to assist with Executive and KMP retention and to incentivise employees to
maximise returns and earnings for Shareholders.
Eligibility
Executive KMP as determined by the Board.
At risk payments
The LTI is a component of ‘at risk’ pay offered to Executive KMP. The number of performance
rights issued will depend on performance against predetermined KPIs with vesting occurring
upon reaching those hurdles.
The number of performance rights that vest is linked to relative Total Shareholder Return (TSR).
2020
CEO
Executive Directors
Other Executive KMP
2021
CEO
COO and CFO
Other Executive KMP
% of TFR applied in LTI
25%
20-30%
20%
% of TFR applied in LTI
25%-50%
30%
20%
Performance conditions KPIs are set for the Group (where relevant).
Each KPI is weighted according to its importance in driving profitable performance and returns to
Shareholders.
KPIs for the CEO, Executive Directors and other Executive KMP comprise 100% against a Total
Shareholder Return (TSR) using a benchmark index namely the S&P/ASX Small Ordinaries
Accumulation Index (XSOAI) measured over a 3 year period.
TSR Comparator Group Assessed 100% against TSR using a benchmark index namely the S&P/ASX Small Ordinaries
Accumulation Index (XSOAI).
Assessment of KPIs
Performance is measured quantitatively and progress against key targets reported at full year.
Trigger for vesting
Assessed 100% against TSR using a benchmark index namely the S&P/ASX Small Ordinaries
Accumulation Index (XSOAI). The Board has discretion to not approve the vesting of the rights if
the TSR is negative.
Cessation of employment LTI forfeited if an Executive resigns or is terminated before the payment date. In exceptional
circumstances this may be reviewed by the Board.
49
MACA LIMITED ANNUAL REPORT 2021
5.6 LTI OUTCOMES
None of the applicable hurdles were met for the period 1 July 2018 to 30 June 2021 (3 year period) for rights to vest in the
LTI performance conditions above for Executives and KMP. Accordingly, no performance rights vested during FY21.
5.7 UNVESTED ENTITLEMENTS
It is the Company’s policy to prohibit executives from entering into transactions or arrangements which limit the economic
risk of participating in unvested entitlements under any equity-based remuneration schemes.
5.8 KMP OPTIONS
No options were granted during the period and no options were vested or were exercised during the period. At 30 June
2021 no options were held by KMP.
5.9 KMP PERFORMANCE RIGHTS
During the 2021 financial year 2,843,084 (2020: 1,906,909) performance rights were granted under the Group’s
Performance Rights Plan and 1,529,493 (2020: 1,452,208) performance rights were forfeited. Subject to the achievement
of designated performance hurdles, these performance rights will vest in June 2023. As at 30 June 2021 there were
4,004,169 (2020: 2,690,578) performance rights outstanding.
MACA LIMITED ANNUAL REPORT 2021
50
S
T
N
E
T
N
O
C
S
U
T
U
O
B
A
P
I
H
S
R
E
D
A
E
L
W
E
I
V
E
R
L
A
N
O
I
T
A
R
E
P
O
T
R
O
P
E
R
’
S
R
O
T
C
E
R
I
D
T
R
O
P
E
R
L
A
I
C
N
A
N
I
F
DIRECTORS’ REPORT
REMUNERATION REPORT CONTINUED
5.9 KMP PERFORMANCE RIGHTS (CONTINUED)
The number of rights over ordinary shares held by each KMP of the Group during the financial year is as follows:
Balance at
Granted as
Exercised
beginning
remuneration
during the
of year
during the year
year
30 June 2021
Other
changes
Balance at
Vested and
Vested and
Unvested at
during the
end of year
exercisable
unexercisable
end of year
Hugh (Andrew) Edwards
Chairman
-
Geoff Baker
Non-Executive Chairman
625,695
-
-
-
-
-
-
-
785,000
-
-
-
-
-
-
362,561
400,556
362,024
328,844
Linton Kirk
Non-Executive Director
Robert Ryan
Non-Executive Director
Chris Sutherland
Non-Executive Director
Sandra Dodds
Non-Executive Director
Nick Marinelli
Non-Executive Director
Mike Sutton
Managing Director /
Chief Executive Officer
David Greig
Chief Operating Officer
Peter Gilford
Chief Financial Officer /
Company Secretary
year
-
(625,695)
-
-
-
-
-
-
-
-
-
-
-
-
-
785,000
(84,489)
678,628
(92,501)
598,367
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
785,000
125,015
553,613
115,819
482,548
240,834
1,821,161
Total
1,350,280
1,514,400
-
(802,685) 2,061,995
In addition to the above there were 1,328,684 performance rights issued to employees and not classed as KMP with
respect to this report.
51
MACA LIMITED ANNUAL REPORT 2021
5.10 KMP SHAREHOLDINGS
The number of ordinary shares in MACA Limited held by each KMP of the Group during the financial year is as follows:
Balance at
Granted as
beginning of
remuneration
year
during the year
Issued on
Increase
exercise of
Other changes
Balance at
other
rights during
during the year
end of year
the year
30 June 2021
Hugh (Andrew) Edwards
Chairman
Geoff Baker
Non-Executive Chairman
Linton Kirk
Non-Executive Director
Robert Ryan
Non-Executive Director
Sandra Dodds
Non-Executive Director
Nick Marinelli
Non-Executive Director
Chris Sutherland
Non-Executive Director
Mike Sutton
Managing Director /
Chief Executive Officer
David Greig
Chief Operating Officer
Peter Gilford
Chief Financial Officer /
Company Secretary
20,000
12,863,816
115,000
58,604
-
-
-
-
-
245,376
Total
13,302,796
S
T
N
E
T
N
O
C
S
U
T
U
O
B
A
P
I
H
S
R
E
D
A
E
L
W
E
I
V
E
R
L
A
N
O
I
T
A
R
E
P
O
T
R
O
P
E
R
’
S
R
O
T
C
E
R
I
D
T
R
O
P
E
R
L
A
I
C
N
A
N
I
F
-
-
-
-
-
-
-
-
-
-
-
-
750,000
28,750
14,652
-
-
-
70,408
-
33,597
897,407
-
-
-
-
-
-
-
-
-
-
-
(20,000)
-
-
-
-
-
-
-
-
-
-
13,613,816
143,750
73,256
-
-
-
70,408
-
278,973
(20,000)
14,180,203
MACA LIMITED ANNUAL REPORT 2021
52
DIRECTORS’ REPORT
REMUNERATION REPORT CONTINUED
5.11 KMP REMUNERATION
5.11.1 Employment benefi ts and payments for the year ended 30 June 2021
The following table sets out the benefits and payment details, in respect to the financial year, and the components of
remuneration for members of office holders and five highest paid key management personnel of the consolidated group.
Short-term benefi ts
Salary, fees
and leave
Comm-
ittee
fees
Cash
bonus/
STI
Post-employment
benefi ts
Long-term
benefi ts
Equity-settled
sharebased
payments
Non-
monetary
Other
Super-
annuation
Other
Incentive
plans
LSL
Share /
Units
Options /
Rights
Total
Year
$
$
$
$
$
$
$
$
$
$
$
$
Executive Directors
Mike Sutton
Managing Director /
Chief Executive Officer
Total compensation for
Executive Directors
Non-Executive Directors
Andrew Edwards
Chairman
Geoff Baker6
Non-Executive
Chairman
Linton Kirk1
Non-Executive Director
Robert Ryan2
Non-Executive Director
Sandra Dodds
Non-Executive Director
Nick Marinelli
Non-Executive Director
Christopher
Sutherland3
Non-Executive Director
Total compensation
for Non-Executive
Directors
Executives (KMP)
David Greig
Chief Operating Officer
Peter Gilford
Chief Financial Officer /
Company Secretary
2021
681,500
2020
222,798
2021
681,500
2020
222,798
2021
76,221
2020
141,553
2021
443,522
2020
538,958
2021
84,658
2020
125,845
2021
94,554
2020
111,581
2021
2020
2021
2020
2021
60,343
-
11,355
-
19,085
2020
27,036
2021
789,738
2020
944,973
2021
516,692
2020
440,077
2021
406,885
2020
390,000
Total compensation for
Executives
2021
2020
923,577
830,077
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
25,000
8,653
25,000
8,653
7,241
13,447
-
-
8,043
8,042
-
-
5,733
-
1,079
-
1,813
2,568
23,909
24,057
-
-
25,000
32,096
- 18,136
25,000
- 18,136
25,000
- 18,136
50,000
- 18,136
57,096
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
- 117,750
824,250
-
-
231,451
- 117,750
824,250
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
231,451
83,462
155,000
443,522
138,859
677,817
-
-
-
-
-
-
-
-
-
-
-
92,701
133,887
94,554
111,581
66,076
-
12,434
-
20,898
29,604
813,647
- 138,859 1,107,889
- 115,137
656,829
-
80,400
552,573
- 102,474
552,495
-
80,897
514,033
- 217,611 1,209,324
- 161,297 1,066,606
53
MACA LIMITED ANNUAL REPORT 2021
5.11 KMP REMUNERATION (CONTINUED)
Short-term benefi ts
Salary, fees
and leave
Comm-
ittee
fees
Cash
bonus/
STI
Post-employment
benefi ts
Long-term
benefi ts
Equity-settled
sharebased
payments
Non-
monetary
Other
Super-
annuation
Other
Incentive
plans
LSL
Share /
Units
Options /
Rights
Total
Year
$
$
$
$
$
$
$
$
$
$
$
$
Former KMP
Chirs Tuckwell4
Managing Director -
Chief Executive Officer
2021
-
2020
665,471
Total compensation
for former KMP
Total compensation
for KMP
2021
-
2020
665,471
2021 2,394,815
2020 2,663,319
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
29,589
19,230
52,804
-
-
-
29,589
19,230
52,804
18,136
98,909
-
47,725
109,036
52,804
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
109,249
876,343
-
-
- 109,249
876,343
- 335,361 2,847,221
- 409,405 3,282,289
1 Linton Kirk was engaged on a contract basis through his business Kirk Mining Consultants to perform consulting work in
2020. The engagement was charged at hourly rates and is included in the amount of salary and fees above.
2 Robert Ryan was engaged on a contract basis through his business Hensman Properties to perform consulting work in
business development in 2020. The engagement was charged at hourly rates and is included in the amount of salary and
fees above.
3 Chris Sutherland resigned as a Non-Executive Director effective 10 September 2020
4 Chris Tuckwell resigned as CEO/Managing Director effective 28th February 2020
5 A restructure of the Corporate Leadership team in FY21 has reduced the members of the management included as KMP.
Accordingly, 30 June 2020 balances have been amended to reflect the restructure.
6 Geoff Baker resigned as an Executive Director in October 2020 and commenced as Non-Executive Chairman in November
2020.
MACA LIMITED ANNUAL REPORT 2021
54
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S
U
T
U
O
B
A
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S
R
E
D
A
E
L
W
E
I
V
E
R
L
A
N
O
I
T
A
R
E
P
O
T
R
O
P
E
R
’
S
R
O
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C
E
R
I
D
T
R
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E
R
L
A
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N
A
N
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DIRECTORS’ REPORT
REMUNERATION REPORT CONTINUED
5.11.2 Employment details of members of key management personnel and other executives
The following table provides details of persons who were, during the financial year, members of key management
personnel of the consolidated Group. The table also sets out the proportion of remuneration that was performance and
non-performance based and the proportion of remuneration received in the form of options and performance rights.
Proportions of elements of remuneration related to performance
Proportions of
elements of
remuneration
not related to
performance
Non-salary cash-
based incentives
Shares / Units
Options / Rights
Fixed Salary / Fees
Total
Year
%
%
%
%
%
Executive Directors
Mike Sutton
Managing Director / Chief Executive Officer
Non-Executive Directors
Andrew Edwards
Chairman
Geoff Baker
Non-Executive Chairman
Linton Kirk
Non-Executive Director
Robert Ryan
Non-Executive Director
Chris Sutherland 2
Non-Executive Director
Sandra Dodds
Non-Executive Director
Nick Marinelli
Non-Executive Director
Executives (KMP)
David Greig
Chief Operating Officer
Peter Gilford
Chief Financial Officer /Company Secretary
Former KMP
Chris Tuckwell 1
CEO/Managing Director
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
14.3
-
-
-
-
20.5
-
-
-
-
-
-
-
-
-
-
17.5
14.6
18.5
15.7
-
12.5
85.7
100.0
100.0
100.0
100.0
79.5
100.0
100.0
100.0
100.0
N/A
100.0
100.0
N/A
100.0
N/A
82.5
85.4
81.5
84.3
N/A
87.5
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
N/A
100.0
100.0
N/A
100.0
N/A
100.0
100.0
100.0
100.0
N/A
100.0
1 Chris Tuckwell - resigned as CEO/Managing Director effective 28 February 2020.
2 Chris Sutherland - resigned as Non-Executive Director effective 10 September 2020.
55
MACA LIMITED ANNUAL REPORT 2021
6.0 EXECUTIVE CONTRACTS
Executive contracts of service between the Company or company within the Group and KMP are on a continuing basis,
the terms of which are not expected to change in the immediate future. The notice period for termination varies from
one to three months.
Executive
Appointment to KMP
Notice period for contract cessation
Mike Sutton
Managing Director / Chief Executive Officer
Geoff Baker
Non-Executive Chairman
David Greig
Chief Operating Officer
Peter Gilford
Chief Financial Officer / Company Secretary
24th February 2020
The contract is ongoing and has
no fixed term
3rd November 2010
The contract is ongoing and has
no fixed term
18th July 2016
The contract is ongoing and has
no fixed term
23rd July 2014
The contract is ongoing and has
no fixed term
The contract can be terminated by either party
with 6 months’ notice or payment in lieu
The contract can be terminated by either party
with 3 months’ notice or payment in lieu
The contract can be terminated by either party
with 3 months’ notice or payment in lieu
The contract can be terminated by either party
with 3 months’ notice or payment in lieu
MACA LIMITED ANNUAL REPORT 2021
56
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T
N
E
T
N
O
C
S
U
T
U
O
B
A
P
I
H
S
R
E
D
A
E
L
W
E
I
V
E
R
L
A
N
O
I
T
A
R
E
P
O
T
R
O
P
E
R
’
S
R
O
T
C
E
R
I
D
T
R
O
P
E
R
L
A
I
C
N
A
N
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DIRECTORS’ REPORT
REMUNERATION REPORT CONTINUED
7.0 NON-EXECUTIVE DIRECTORS FEES
Non-executive Directors fees are determined within an aggregate directors fee pool which is periodically recommended
for approval to shareholders. The current aggregate directors’ fee pool is $600,000. This provides for any future increases
to Non-executive Directors fees and to allow for any changes to the Board make up and potential increases in the number
of Non-executive Directors.
Fees paid to Non-executive Directors are set at levels which reflect both the responsibilities of, and time commitments
required from, each Non-executive Director to discharge their duties and are not linked to the financial performance of the
Company. Non-executive Directors fees are reviewed annually by the Board to ensure they are appropriate for the duties
performed, including Board committee duties, and are in line with the market. Other than statutory superannuation, Non-
executive Directors are not entitled to retirement benefits.
Non-Executive Directors
$ / Chairman
Member
Andrew Edwards 1
Geoff Baker
Linton Kirk
Robert Ryan
Sandra Dodds
Nick Marinelli
$155,000
Board
$155,000
Board
$102,700
Risk
$102,700
Remuneration
$102,700
Audit
$92,700
Chris Sutherland 2
$92,700
Audit Committee
Risk Committee
Remuneration Committee
Audit Committee
Risk Committee
Remuneration Committee
Audit Committee
Risk Committee
Remuneration Committee
Audit Committee
Risk Committee
Remuneration Committee
Audit Committee
Risk Committee
Remuneration Committee
Audit Committee
Risk Committee
Remuneration Committee
Audit Committee
Risk committee
Remuneration Committee
1 Andrew Edwards retired as Non-Executive Chairman on 19 November 2020 and as a Director on 7 December 2020
2 Chris Sutherland - resigned as Non-Executive Director effective 10 September 2020
57
MACA LIMITED ANNUAL REPORT 2021
8.0 OTHER TRANSACTIONS WITH KEY MANAGEMENT PERSONS AND/OR RELATED PARTIES
Key management person and/or related party
Transaction
Partnership of which current director Mr G Baker is a
25% partner.
Kirk Mining Consultants - a company controlled by current
director Mr L Kirk.
Hensman Properties Pty Ltd - a company controlled by
current director Mr R. Ryan.
Gateway Equipment Parts & Services Pty Ltd – a company
of which current director Mr G Baker is a shareholder.
Expense - Rent on
Division St business
premises.
Expense - Mining
consulting fees
Expense - Consulting
fees
Expense - Hire
of equipment
and purchase of
equipment, parts and
services.
2021
$
2020
$
1,578,800
1,547,850
-
-
41,187
18,881
5,851,769
4,974,153
Gateway Equipment Parts & Services Pty Ltd – a company
Sale of equipment
-
430,000
of which current director Mr G Baker is a shareholder.
(Revenue)
Amounts payable at year end arising from the above
transactions (Receivables Nil).
Gateway Equipment Parts & Services Pty Ltd – a company
of which current director Mr G Baker is a shareholder.
919,751
150,244
This directors’ report, incorporating the remuneration report, is signed in accordance with a resolution of the Board of
Directors.
On behalf of the Directors
Mike Sutton
Managing Director
24th day of September, 2021
Perth
MACA LIMITED ANNUAL REPORT 2021
58
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D
A
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L
W
E
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L
A
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O
I
T
A
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E
P
O
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R
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R
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FINANCIAL REPORT
AUDITOR’S INDEPENDENCE
DECLARATION
AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION
307C OF THE CORPORATIONS ACT 2001 TO THE DIRECTORS
OF MACA LIMITED & CONTROLLED ENTITIES
Moore Australia Audit (WA)
Level 15, Exchange Tower,
2 The Esplanade, Perth, WA 6000
PO Box 5785, St Georges Terrace, WA 6831
T +61 8 9225 5355
F +61 8 9225 6181
www.moore-australia.com.au
I declare that, to the best of my knowledge and belief, during the year ended 30 June 2021 there have been
no contraven(cid:415)ons of:
i.
ii.
the auditor independence requirements as set out in the Corpora(cid:415)ons Act 2001 in rela(cid:415)on to
the audit; and
any applicable code of professional conduct in rela(cid:415)on to the audit.
SL TAN
PARTNER
MOORE AUSTRALIA AUDIT (WA)
CHARTERED ACCOUNTANTS
Signed at Perth this 24th day of September 2021
Moore Australia Audit (WA) – ABN 16 874 357 907.
An independent member of Moore Global Network Limited - members in principal cities throughout the world.
Liability limited by a scheme approved under Professional Standards Legislation
59
MACA LIMITED ANNUAL REPORT 2021
CORPORATE GOVERNANCE
STATEMENT CHECKLIST
The Board of MACA Limited
is committed to ensuring that
the Company’s obligations and
responsibilities to its stakeholders
are fulfilled through its corporate
governance practices. MACA’s Vision is
to “Be Number 1 in what we do”, and
we achieve this by demonstrating the
Core Values of the Company – People
First, Exceed Expectations, Continuous
Improvement, Accountability and
Community. Our Core Values are
underpinned by our commitment to our
Promise – We Care, We are Flexible and
We Deliver. We believe that operating
in accordance with the corporate
governance guidelines enhances the
delivery of the above expectations.
This checklist reports on MACA’s
key governance principles and
practices which are reviewed and
revised as appropriate to reflect
changes in law and developments in
corporate governance. A complete
Corporate Governance Statement and
all Charters, Policies, Procedures,
Disclosures, Definitions, Codes and
Strategies are available for viewing
on the Company’s website under the
Corporate Governance tab.
As required by the Australian Securities
Exchange Limited (“ASX”) Listing
Rules, the Corporate Governance
Statement contained on the Company
website and in reference to this
checklist reports on:
- The extent to which the Company
has followed the Corporate
Governance recommendations
contained in the ASX Corporate
Governance Council’s Corporate
Governance Principles and
Recommendations (4th Edition);
and
- The reasons for any departures
from the Corporate Governance
Council’s Corporate Governance
Principles and Recommendations
(4th Edition), in compliance with the
“if not, why not” regime.
OVERALL APPROACH TO
CORPORATE GOVERNANCE
The Board as a whole reviews
and makes changes in line with
recommendations made by
individual Board members and as
a result of this focus, the Board is
satisfied that the Company meets
the Corporate Governance Council’s
Corporate Governance Principles and
Recommendations with departures
as disclosed below. There were no
departures during the year.
A checklist cross-referencing the
Corporate Governance Council’s
Corporate Governance Principles and
Recommendations to the relevant
sections of the Companies Corporate
Governance Statement (CGS) is
shown below.
ASX CORPORATE GOVERNANCE
PRINCIPLES AND BEST PRACTICE RECOMMENDATIONS
REFERENCE AND
IF COMPLIANT
PRINCIPLE 1 - LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT
A listed entity should clearly delineate the respective roles and responsibilities of its board
and management and regularly review their performance.
Recommendation 1.1
A listed entity should have and disclose a board charter setting out:
(a) the respective roles and responsibilities of its board and management; and
(b) those matters expressly reserved to the board and those delegated to management.
Recommendation 1.2
A listed entity should:
(a) undertake appropriate checks before appointing a director or senior executive or putting
someone forward for election as a director; and
(b) provide security holders with all material information in its possession relevant to a
decision on whether or not to elect or re-elect a director.
Recommendation 1.3
A listed entity should have a written agreement with each director and senior executive
setting out the terms of their appointment.
Recommendation 1.4
The company secretary of a listed entity should be accountable directly to the board,
through the chair, on all matters to do with the proper functioning of the board.
✓
✓
✓
1.1
Board Charter in CGS
1.2
Board Charter in CGS
1.3
Remuneration Report in CGS
✓
1.4
Board Charter in CGS
✓
MACA LIMITED ANNUAL REPORT 2021
60
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FINANCIAL REPORT
CORPORATE GOVERNANCE STATEMENT CHECKLIST CONTINUED
ASX CORPORATE GOVERNANCE
PRINCIPLES AND BEST PRACTICE RECOMMENDATIONS
Recommendation 1.5
A listed entity should:
(a) have and disclose a diversity policy;
(b) through its board or a committee of the board set measurable objectives for achieving
gender diversity in the composition of its board, senior executives and workforce generally;
and
(c) disclose in relation to each reporting period:
(1) the measurable objectives set for that period to achieve gender diversity;
(2) the entity’s progress towards achieving those objectives;
(3) either:
(A) the respective proportions of men and women on the Board, in senior executive
positions and across the whole workforce (including how the entity has defined
“senior executive” for these purposes); or
(B) if the entity is a “relevant employer” under the Workplace Gender Equality Act,
the entity’s most recent “Gender Equality Indicators”, as defined in and published
under the Act.
Recommendation 1.6
A listed entity should:
(a) have and disclose a process for periodically evaluating the performance of the board, its
committees and individual directors; and
(b) disclose for each reporting period whether a performance evaluation has been undertaken
in accordance with that process during or in respect of that period.
Recommendation 1.7
A listed entity should:
(a) have and disclose a process for evaluating the performance of its senior executives at least
once every reporting period; and
(b) disclose for each reporting period whether a performance evaluation has been undertaken
in accordance with that process during or in respect of that period.
PRINCIPLE 2 - STRUCTURE THE BOARD TO BE EFFECTIVE AND ADD VALUE
The board of a listed entity should be an appropriate size and collectively have the skills,
commitment and knowledge of the entity and the industry in which it operates, to enable it to
discharge its duties effectively and to add value.
Recommendation 2.1
The board of a listed entity should:
(a) have a nomination committee which:
(1) has at least three members, a majority of whom are independent directors; and
(2) is chaired by an independent director, and disclose:
(3) the charter of the committee;
(4) the members of the committee; and
(5) as at the end of each reporting period, the number of times the committee met throughout
the period and the individual attendances of the members at those meetings; or
(b) if it does not have a nomination committee, disclose the fact and the processes it employs
to address board succession issues and to ensure that the board has the appropriate balance
of skills, knowledge, experience, independence and diversity to enable it to discharge its
duties and responsibilities effectively.
REFERENCE AND
IF COMPLIANT
1.5
✓
Diversity Procedure in CGS
1.6
✓
Disclosure - Performance
Evaluation in CGS
1.7
✓
Disclosure - Performance
Evaluation in CGS
2.1
Directors Report
Board Charter in CGS
✓
Nomination Committee
Charter in CGS
61
MACA LIMITED ANNUAL REPORT 2021
ASX CORPORATE GOVERNANCE
PRINCIPLES AND BEST PRACTICE RECOMMENDATIONS
Recommendation 2.2
A listed entity should have and disclose a Board skills matrix setting out the mix of skills that
the Board currently has or is looking to achieve in its membership.
Recommendation 2.3
A listed entity should disclose:
(a) the names of the directors considered by the Board to be independent directors;
(b) if a Director has an interest, position, or relationship of the type described in the
recommendations but the board is of the opinion that it does not compromise the
independence of the director, the nature of the interest, position or relationship in question
and an explanation of why the board is of that opinion; and
(c) the length of service of each director.
Recommendation 2.4
A majority of the board of a listed entity should be independent directors.
Recommendation 2.5
REFERENCE AND
IF COMPLIANT
2.2
2.3
Definition of
Independence in CGS
2.4
2.5
✓
✓
✓
The chair of the board of a listed entity should be an independent director and, in particular,
should not be the same person as the CEO of the entity.
Refer to commentary in CGS
Recommendation 2.6
A listed entity should have a program for inducting new directors and for periodically
reviewing whether there is a need for existing directors to undertake professional
development to maintain the skills and knowledge needed to perform their role as directors
effectively.
PRINCIPLE 3 - INSTIL A CULTURE OF ACTING LAWFULLY, ETHICALLY AND RESPONSIBLY
A listed entity should instil and continually reinforce a culture across the organisation of acting
lawfully, ethically and responsibly.
Recommendation 3.1
A listed entity should articulate and disclose its values.
Recommendation 3.2
A listed entity should:
(a) have and disclose a code of conduct for its directors, senior executives and employees; and
(b) ensure that the board or a committee of the board is informed of any material breaches of
that code.
Recommendation 3.3
A listed entity should:
(a) have and disclose a whistleblower policy; and
(b) ensure that the board or a committee of the board is informed of any material incidents
reported under that policy.
Recommendation 3.4
A listed entity should:
(a) have and disclose an anti-bribery and corruption policy; and
(b) ensure that the board or a committee of the board is informed of any material incidents
reported under that policy.
2.6
✓
Board Charter in CGS
Nomination Committee
Charter in CGS
✓
✓
✓
3.1
Corporate Code of
Conduct in CGS
3.2
Corporate Code of
Conduct in CGS
3.3
Whistleblower
Procedure in CGS
3.4
✓
Anti-Bribery and
Corruption Procedure
in CGS
MACA LIMITED ANNUAL REPORT 2021
62
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FINANCIAL REPORT
CORPORATE GOVERNANCE STATEMENT CHECKLIST CONTINUED
ASX CORPORATE GOVERNANCE
PRINCIPLES AND BEST PRACTICE RECOMMENDATIONS
PRINCIPLE 4 - SAFEGUARD THE INTEGRITY OF CORPORATE REPORTS
A listed entity should have appropriate processes to verify the integrity of its corporate reports.
Recommendation 4.1
The board of a listed entity should :
(a) have an audit committee which:
(1) has at least three members, all of whom are non-executive directors and a majority of
whom are independent directors; and
(2) is chaired by an independent director, who is not chair of the board, and disclose:
(3) the charter of the committee;
(4) the relevant qualifications and experience of the members of the committee; and
(5) in relation to each reporting period, the number of times the committee met throughout
the period and the individual attendances of the members at those meetings.
REFERENCE AND
IF COMPLIANT
4.1
✓
Audit Committee Charter in
CGS
Recommendation 4.2
4.2
✓
The Board of a listed entity should, before it approves the entity’s financial statements for a
financial period, receive from its Managing Director and Chief Financial Officer a declaration
that, in their opinion the financial records of the entity have been properly maintained and that
the financial statements comply with the appropriate accounting standards and give a true
and fair view of the financial position and performance of the entity and that the opinion has
been formed on the basis of a sound system of risk management and internal control which is
operating effectively.
Recommendation 4.3
4.3
✓
A listed entity should disclose its process to verify the integrity of any periodic corporate
report it releases to the market that is not audited or reviewed by an external auditor.
PRINCIPLE 5 - MAKE TIMELY AND BALANCED DISCLOSURE
A listed entity should make timely and balanced disclosure of all matters concerning it that a
reasonable person would expect to have a material effect on the price or value of its securities.
Recommendation 5.1
A listed entity should have and disclose a written policy for complying with its continuous
disclosure obligations under Listing Rule 3.1.
Recommendation 5.2
A listed entity should ensure that its board receives copies of all material announcements
promptly after they have been made.
Recommendation 5.3
A listed entity that gives a new and substantive investor or analyst presentation should release
a copy of the presentation materials on the ASX Market Announcements Platform ahead of the
presentation.
5.1
Continuous
Disclosure in CGS
Compliance
Procedure in CGS
5.2
5.3
✓
✓
✓
63
MACA LIMITED ANNUAL REPORT 2021
ASX CORPORATE GOVERNANCE
PRINCIPLES AND BEST PRACTICE RECOMMENDATIONS
PRINCIPLE 6 - RESPECT THE RIGHTS OF SECURITY HOLDERS
A listed entity should provide its security holders with appropriate information and facilities to
allow them to exercise their rights as security holders effectively.
Recommendation 6.1
A listed entity should provide information about itself and its governance to investors via its
website.
Recommendation 6.2
A listed entity should have an investor relations program that facilitates effective two-way
communication with investors.
Recommendation 6.3
REFERENCE AND
IF COMPLIANT
6.1
Shareholder
Communication
Strategy in CGS
6.2
6.3
A listed entity should disclose how it facilitates and encourages participation at meetings of
security holders.
Investor Centre in CGS
Recommendation 6.4
A listed entity should ensure that all substantive resolutions at a meeting of security holders
are decided by a poll rather than by a show of hands.
Recommendation 6.5
A listed entity should give security holders the option to receive communications from, and
send communications to, the entity and its security registry electronically.
PRINCIPLE 7 - RECOGNISE AND MANAGE RISK
A listed entity should establish a sound risk management framework and periodically review
the effectiveness of that framework.
Recommendation 7.1
The Board of a listed entity should:
(a) have a committee or committees to oversee risk, each of which:
(1) has at least three members, a majority of whom are independent directors; and
(2) is chaired by an independent director, and disclose:
(3) the charter of the committee;
(4) the members of the committee; and
(5) as at the end of each reporting period, the number of times the committee met throughout
the period and the individual attendances of the members at those meetings.
Recommendation 7.2
The board or a committee of the board should:
(a) review the entity’s risk management framework at least annually to satisfy itself that it
continues to be sound and that the entity is operating with due regard to the risk appetite set
by the board; and
(b) disclose, in relation to each reporting period, whether such a review has taken place.
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✓
✓
✓
✓
✓
6.4
Shareholder
Communication
Strategy
in CGS
6.4
Shareholder
Communication
Strategy in CGS
7.1
Risk Committee
Charter in CGS
7.2
✓
Disclosure -
Risk Management in CGS
MACA LIMITED ANNUAL REPORT 2021
64
FINANCIAL REPORT
CORPORATE GOVERNANCE STATEMENT CHECKLIST CONTINUED
ASX CORPORATE GOVERNANCE
PRINCIPLES AND BEST PRACTICE RECOMMENDATIONS
Recommendation 7.3
A listed entity should disclose:
(a) if it has an internal audit function, how the function is structured and what role it performs;
and
(b) if it does not have an internal audit function, that fact and the processes it employs for
evaluating and continually improving the effectiveness of its governance, risk management
and internal control processes.
Recommendation 7.4
A listed entity should disclose whether it has any material exposure to environmental or social
risks and, if it does, how it manages those risks.
PRINCIPLE 8 - REMUNERATE FAIRLY AND RESPONSIBLY
A listed entity should pay director remuneration sufficient to attract and retain high quality
directors and design its executive remuneration to attract, retain and motivate high quality
senior executives and to align their interests with the creation of value for security holders and
with the entity’s values and risk appetite.
Recommendation 8.1
The board of a listed entity should:
(a) have a remuneration committee which:
(1) has at least three members, a majority of whom are independent directors; and
(2) is chaired by an independent director, and disclose:
(3) the charter of the committee;
(4) the members of the committee; and
as at the end of each reporting period, the number of times the committee met throughout the
period and the individual attendances of the members at those meetings.
Recommendation 8.2
A listed entity should separately disclose its policies and practices regarding the remuneration
of non-executive directors and the remuneration of executive directors and other senior
executives.
Recommendation 8.3
A listed entity which has an equity-based remuneration scheme should :
(a) have a policy on whether participants are permitted to enter into transactions (whether
through the use of derivatives or otherwise) which limit the economic risk of participating in
the scheme; and
(b) disclose that policy or a summary of it.
REFERENCE AND
IF COMPLIANT
7.3
In CGS
7.4
In CGS
✓
✓
8.1
✓
Remuneration Report
in CGS
Remuneration Committee
Charter in CGS
8.2
Remuneration Report
in CGS
8.3
Remuneration Report
in CGS
✓
✓
65
MACA LIMITED ANNUAL REPORT 2021
DIRECTORS’ DECLARATION
The directors of the company declare that:
1. The financial statements set out on pages 67 to 113 are in accordance with the Corporations Act 2001 and:
(a) comply with Accounting Standards which as stated in the accounting policies included in the financial statements,
constitutes explicit and unreserved compliance with International Financial Reporting Standards (IFRS); and
(b) give a true and fair view of the financial position as at 30 June 2021 and of the performance for the year ended on
that date of the company and consolidated group;
2. The Managing Director (acting as Chief Executive Officer) and Chief Finance Officer have each declared that:
(a) the financial records of the Group for the financial year have been properly maintained in accordance with s286 of
the Corporations Act 2001;
(b) the financial statements and notes for the financial year comply with the International Financial Reporting
Standards; and
(c) the financial statements and notes for the financial year give a true and fair view of the financial performance and
results of the entity.
In the directors’ opinion there are reasonable grounds to believe that the Group will be able to pay its debts as and when
they become due and payable.
This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the
directors by:
Mike Sutton
Chief Executive Officer and Managing Director
Dated at 24th September 2021
MACA LIMITED ANNUAL REPORT 2021
66
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FINANCIAL REPORT
CONSOLIDATED STATEMENT OF
PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
For the Year Ended 30 June 2021
Continuing Operations
Revenue
Other Income
Gain on Business Combination
Direct Costs
Finance Costs
Impairment of Assets
Foreign Exchange Gains / (Losses)
Stamp Duty for Acquisition of Mining West
Other Expenses from Ordinary Activities
Profi t Before Income Tax
Income Tax Expense
Profi t Aft er Tax from Continuing Operations
Discontinued Operations
Profit / (Loss) After Tax from Discontinued Operations
Transfer of Foreign Exchange Reserve on Discontinued Operations
Profi t / (Loss) for the Year
Other Comprehensive Income:
Exchange Differences on Translating Foreign Operations
Transfer of Foreign Exchange Reserve on Discontinued Operations
Total Comprehensive Income for the Year
Profit / (Loss) Attributable to:
- Non-Controlling Interest
- Members of the Parent Entity
Total Comprehensive Income Attributable to:
- Non-Controlling Interest
- Members of the Parent Entity
Earnings per Share
From Continuing and Discontinued Operations:
- Basic Earnings per Share (cents)
- Diluted Earnings per Share (cents)
From Continuing Operations:
- Basic Earnings per Share (cents)
- Diluted Earnings per Share (cents)
From Discontinued Operations:
- Basic Earnings per Share (cents)
- Diluted Earnings per Share (cents)
The accompanying Sections form part of these Financial Statements
67
MACA LIMITED ANNUAL REPORT 2021
Section
3.1(a)
3.1(b)
6.1
3.3
3.3
3.6.1(a)
3.7
5.6
5.6
3.8
3.8
3.8
3.8
3.8
3.8
30 June
2021
$’000
30 June
2020
$’000
1,173,920
36,679
4,535
(1,130,110)
(8,521)
(3,221)
(2,445)
(9,392)
(24,997)
36,448
(11,246)
25,202
(3,666)
(806)
20,730
-
-
20,730
1,784
18,946
20,730
1,784
18,946
20,730
6.20
6.10
7.67
7.54
(1.46)
(1.44)
795,755
38,013
-
(748,000)
(6,468)
(51,602)
1,415
-
(23,044)
6,069
(2,486)
3,583
(10,472)
(10,567)
(17,456)
(2,072)
10,567
(8,961)
418
(17,874)
(17,456)
418
(9,379)
(8,961)
(6.67)
(6.57)
1.18
1.16
(7.85)
(7.74)
CONSOLIDATED STATEMENT OF
FINANCIAL POSITION
As at 30 June 2021
Current Assets
Cash and Cash Equivalents
Trade and Other Receivables
Inventory and Work In Progress
Other Financial Assets
Other Assets
Total Current Assets
Non-Current Assets
Trade and Other Receivables
Property, Plant and Equipment*
Loans to Other Companies
Other Assets
Intangible Assets
Deferred Tax Assets
Total Non-Current Assets
Total Assets
Current Liabilities
Trade and Other Payables
Deferred Consideration Payable
Interest Bearing Liabilities
Current Tax Liabilities
Short-Term Provisions
Total Current Liabilities
Non-Current Liabilities
Deferred Tax Liabilities
Interest Bearing Liabilities
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Issued Capital
Reserves
Retained Profits
Parent Interest
Non-Controlling Interest
Total Equity
Section
5.1.1
4.1
4.2
4.1
4.3
4.1
4.4
4.1
4.3
4.5
3.6.2(a)
4.6
4.6
5.2.1
3.6.2(b)
4.7
3.6.2(b)
5.2.1
5.5
5.6
30 June
2021
$’000
30 June
2020
$’000
122,346
284,651
45,052
30
8,418
460,497
9,469
478,779
26,841
1,175
3,663
28,417
548,344
1,008,841
246,622
38,500
97,331
10
32,431
414,894
1,099
205,240
206,339
621,233
387,608
342,267
(5,298)
45,322
382,291
5,317
387,608
114,650
154,329
9,477
69
5,550
284,075
-
293,318
26,841
-
-
23,559
343,718
627,793
111,916
-
55,127
2,169
15,976
185,188
-
132,945
132,945
318,133
309,660
269,806
(5,298)
41,619
306,127
3,533
309,660
*Includes Right-Of-Use Assets
The accompanying Sections form part of these Financial Statements
MACA LIMITED ANNUAL REPORT 2021
68
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FINANCIAL REPORT
CONSOLIDATED STATEMENT OF
CHANGES OF EQUITY
For the Year Ended 30 June 2021
Issued
Capital
Retained
Profi ts
Outside
Equity
Interest
General
Reserves
Option
Reserve
FX
Reserve
Total
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Balance at 1 Jul 2019
269,806
73,496
3,157
(5,888)
590
(8,495)
332,666
Effect of AASB16
-
(603)
(42)
-
-
-
(645)
Restated Balance at 1 Jul 2019
269,806
72,893
3,115
(5,888)
590
(8,495)
332,021
Profit / (Loss) for the Year
-
(17,874)
418
-
-
-
(17,456)
SUB-TOTAL
269,806
55,019
3,533
(5,888)
590
(8,495)
314,565
Other Comprehensive Income:
Forex in Translating Foreign
Operations
Transfer of FX Reserve on
Discontinued Operations
-
-
-
-
-
-
-
-
-
(2,072)
(2,072)
-
10,567
10,567
SUB-TOTAL
Dividends Paid
269,806
55,019
3,533
(5,888)
-
(13,400)
-
-
Balance at 30 Jun 2020
269,806
41,619
3,533
(5,888)
Balance at 1 Jul 2020
269,806
41,619
3,533
(5,888)
Profit / (Loss) for the Year
-
18,946
1,784
-
SUB-TOTAL
269,806
60,565
5,317
(5,888)
Other Comprehensive Income:
Forex in Translating Foreign
Operations
Transfer of FX Reserve on
Discontinued Operations
-
-
-
-
-
-
-
-
590
-
590
590
-
590
-
-
SUB-TOTAL
269,806
60,565
5,317
(5,888)
590
Shares Issued (net of costs)
72,461
-
Dividends Paid
-
(15,243)
-
-
-
-
-
-
Balance at 30 Jun 2021
342,267
45,322
5,317
(5,888)
590
-
-
-
-
-
-
-
-
-
-
-
-
323,060
(13,400)
309,660
309,660
20,730
330,390
-
-
330,390
72,461
(15,243)
387,608
The accompanying Sections form part of these Financial Statements.
69
MACA LIMITED ANNUAL REPORT 2021
CONSOLIDATED STATEMENT OF
CASH FLOWS
For the Year Ended 30 June 2021
Cash Flows From Operating Activities
Receipts from Customers
Payments to Suppliers and Employees
Interest Received
Interest Paid
Income Tax Paid
Section
30 June
2021
$’000
30 June
2020
$’000
1,040,442
787,478
(901,306)
(652,119)
289
3,292
(8,521)
(6,834)
(12,154)
(15,187)
Net Cash Provided By / (Used In) Operating Activities
5.1.2
118,750
116,630
Cash Flow From Investing Activities
Proceeds from Sale of Investments
Proceeds from Sale of Property, Plant and Equipment
Purchase of Property, Plant and Equipment*
Net Loans Repaid by / (Provided to) Customers
Purchase of Investments
Acquisition of Mining West
-
2,838
19,836
7,735
(91,980)
(63,444)
(100)
-
6.1
(136,500)
22,591
(5,435)
-
Net Cash Provided By / (Used In) Investing Activities
(225,742)
(18,717)
Cash Flow From Financing Activities
Net Proceeds from Share Issue
Proceeds from Borrowings*
Repayment of Borrowings
Dividends Paid by the Parent
Net Cash Provided by / (Used In) Financing Activities
Net Increase/(Decrease) in Cash Held
Effect of Forex Rate Changes
Cash and Cash Equivalents at the Beginning of the Year
Cash and Equivalents at the End of the Year
5.1.1
72,461
-
144,939
23,821
(85,212)
(52,975)
(15,243)
(13,400)
116,945
(42,554)
9,953
(2,257)
114,650
122,346
55,359
(1)
59,292
114,650
* Non-Cash Financing and Investing Activities
During the period ended 30 June 2021 the Group acquired $50.9 million (2020:$61.1m) in plant and equipment by means of
finance leases (included in right-of-use assets), directly from original equipment manufacturers.These acquisitions are not
reflected above.
The accompanying Sections form part of these Financial Statements.
MACA LIMITED ANNUAL REPORT 2021
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SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
SECTION 1 GENERAL INFORMATION
1.1 REPORTING ENTITY
1.3 BASIS OF CONSOLIDATION
MACA Limited (MLD) is a limited company incorporated
in Australia. The addresses of the Company’s registered
office and principal places of business are disclosed in
the Corporate Directory. The principal activities of the
Company are described in the Directors’ Report. The
financial statements were authorised for issue by the
Directors on the 24th of September 2021.
1.2 BASIS OF PREPARATION
The financial statements are general purpose financial
statements that have been prepared in accordance with
Australian Accounting Standards, Australian Accounting
Interpretations, other authoritative pronouncements
of the Australian Accounting Standards Board and the
Corporations Act 2001. The Company is a for profit
entity for financial reporting purposes under Australian
Accounting Standards. These financial statements also
comply with International Financial Reporting Standards
as issued by the International Accounting Standards
Board (IASB).
Australian Accounting Standards set out accounting
policies that the AASB has concluded would result in
financial statements containing relevant and reliable
information about transactions, events and conditions.
Compliance with Australian Accounting Standards
ensures that the financial statements and notes also
comply with International Financial Reporting Standards
as issued by the IASB. Material accounting policies
adopted in the preparation of these financial statements
are presented below and have been consistently applied
unless otherwise stated.
These financial statements have been prepared on
an accruals basis and are based on historical costs,
modified, where applicable, by the measurement at fair
value of selected non-current assets, financial assets
and financial liabilities. These financial statements
are presented in Australian dollars and rounded to the
nearest thousand ($’000), unless otherwise stated,
in accordance with ASIC Corporations (Rounding in
Financial/Directors’ Reports) Instrument 2016/191.
The consolidated financial statements incorporate the
assets and liabilities of all subsidiaries of MACA Limited
(the ‘Company’) as at 30 June 2021 and the results of
all subsidiaries for the year then ended. MACA Limited
and its subsidiaries together are referred to in these
financial statements as the “Group” or “Consolidated”.
Subsidiaries are all those entities over which the
Company has control. The Company controls an
entity when it is exposed to, or has rights to, variable
returns from its involvement with the entity and has
the ability to affect those returns through its power
to direct the activities of the entity. Subsidiaries are
fully consolidated from the date on which control is
transferred to the Group. They are de-consolidated from
the date that control ceases.
Intercompany transactions, balances and unrealised
gains on transactions between entities in the Group
are eliminated. Unrealised losses are also eliminated
unless the transaction provides evidence of the
impairment of the asset transferred. Accounting policies
of subsidiaries have been changed where necessary
to ensure consistency with the policies adopted by the
Group.
The acquisition of subsidiaries is accounted for using
the acquisition method of accounting. A change in
ownership interest, without the loss of control, is
accounted for as an equity transaction, where the
difference between the consideration transferred
and the book value of the share of the non-controlling
interest acquired is recognised directly in equity
attributable to the parent.
Non-controlling interest in the results and equity of
subsidiaries are shown separately in the statement
of profit or loss and other comprehensive income,
statement of financial position and statement of
changes in equity of the Group. Losses incurred by the
Group are attributed to the non-controlling interest
in full.
71
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
1.4 NEW ACCOUNTING STANDARDS ADOPTED BY THE
SECTION 2 CRITICAL ACCOUNTING ESTIMATES
GROUP DURING THE YEAR
AND JUDGEMENTS
Initial adoption of AASB 2018-6: Amendments to
Australian Accounting Standards - Defi nition of a
Business
AASB 2018-6 amends and narrows the definition of a
business specified in AASB 3: Business Combinations,
simplifying the determination of whether a transaction
should be accounted for as a business combination
or an asset acquisition. Entities may also perform a
calculation and elect to treat certain acquisitions as
acquisition of assets.
The standard listed above did not have any impact on
the amounts recognised in prior periods and are not
expected to significantly affect the current or future
period.
1.5 NEW ACCOUNTING STANDARDS FOR APPLICATION IN
FUTURE PERIODS
A number of new accounting standards, amendments to
standards and interpretations are not yet effective for
the 30 June 2021 reporting period and have not been
early adopted in preparing these financial statements.
The Directors’ assessment of these new accounting
standards (to the extent relevant to the Group) and
interpretations is that they are not expected to have a
material effect on the financial statements of the Group.
1.6 COMPARATIVE FIGURES
When required by Accounting Standards, comparative
figures have been adjusted to conform to changes in
presentation for the current financial year.
When the Group applies an accounting policy
retrospectively, makes a retrospective restatement
or reclassifies items in its financial statements, a
statement of financial position as at the beginning of the
earliest comparative period will be disclosed. There is
no adjustment to comparative figures for the acquisition
of Mining West.
The Directors evaluate estimates and judgments
incorporated into the financial report based on historical
knowledge and best available current information. Estimates
assume a reasonable expectation of future events and are
based on current trends and economic data, obtained both
externally and within the Group.
KEY ESTIMATES AND JUDGEMENTS
Impairment - Property, Plant and Equipment
The Group assesses impairment at the end of each reporting
period by evaluating conditions and events specific to
the Group that may be indicative of impairment triggers.
Recoverable amounts of relevant assets are reassessed
using value-in-use calculations which incorporate various
key assumptions.
The value in use calculations with respect to assets require
an estimation of the future cash flows expected to arise
from each cash generating unit and a suitable discount rate
to apply to these cash flows to calculate net present value.
The Directors have determined that there is no adjustment
required to the carrying value of assets in the current
reporting period.
Impairment - Trade and Other Receivables and Loans to
Other Companies
As at 30 June 2021, the Group’s trade and other receivables
and loans to other companies amounted to $325.2m (30 June
2020: $229.6m), before recognition of any impairment.
Based on the Group’s historical credit loss experience, trade
receivables and loans to other companies exhibit different
loss patterns for each revenue segment. Where the Group
has common customers across the different geographical
regions it applies credit evaluations firstly by segment, where
payment profiles exceed 12 months. Receivables identified
within each revenue segment, are then evaluated on an
individual basis. Management has assessed and impaired
receivables by $4.2m, being bad debts written off $3.2m and
a provision for doubtful debts of $0.9m (from discontinued
operations), through the profit and loss. There was no further
impairment to trade and loan receivables with Carabella
Resources Pty Ltd in the current period.
In the assessment of loans to other companies, no overdue
payments were outstanding for greater than 12 months with
exception of the loan to Carabella Resources Pty Ltd, where
we have first ranking securities over the company assets.
(Refer to Section 5.3 for details)
MACA LIMITED ANNUAL REPORT 2021
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
2.0 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED)
Taxation
Estimation of Useful Lives of Assets
Balances disclosed in the financial statements and the notes
thereto, related to taxation, are based on best estimates.
These estimates take into account both the financial
performance and position of the Group as they pertain
to current income taxation legislation, and the Group’s
understanding thereof. No adjustment has been made for
pending or future taxation legislation. The current income
tax position represents that best estimate, pending an
assessment by the Australian Taxation Office.
The estimation of the useful lives of property, plant and
equipment is based on historical experience and is reviewed
on an ongoing basis. The condition of the assets is assessed
at least annually against the remaining useful life with
adjustments made when considered necessary.
Business Combinations
Management uses valuation techniques in determining
the fair values of the various elements of a business
combination. See sections 4.5 Intangible Assets - Customer
Contracts and 6.1 Business Combinations.
SECTION 3 RESULTS FOR THE YEAR
This section focuses on the results and performance of the Group and includes disclosures explaining the Group’s results for
the year, segment information, capital and leasing commitments, taxation, profit/(loss) from discontinued operations and EPS.
3.1 REVENUE
Accounting Policies
Revenue Recognition
Under AASB 15, revenue is recognised when the
performance obligations are considered met, which can be
at a point in time, or over time, depending on the various
service offerings. Major activities of the Group are detailed
below.
Contract Services
Contracts for services includes contract mining, drill and
blast, excavation, earthmoving, crushing, infrastructure and
road construction and maintenance.
The relevant performance obligations are fulfilled over time
as the Group enhances assets which the customer controls,
for which the Group does not have an alternative use and for
which the Group has a right to payment for performance to
date and as such revenue is recognised over time.
Revenue is measured and recognised monthly using the
outputs method, either based on units of production
(typically for contract mining services, which is the largest
segment in the Group) or on the achievement of milestones
(generally for civil and infrastructure projects) at agreed
contract rates that are aligned with the stand alone selling
prices for each performance obligation. The majority of the
Group’s revenue (i.e. in respect of mining services) is paid
one month in arrears and therefore gives rise to a process
of invoicing or accruing revenue monthly, based on the
achievement of contractually agreed production related
measures, as noted above.
For rental of equipment, as the customer simultaneously
receives and consumes the benefits, the Group has an
enforceable right to payment, based on agreed contract
rates, and as such the performance obligation is fulfilled
over time.
The total transaction price for contract services may include
variable consideration. Variable consideration is only
recognised and recorded in the accounts to the extent that it
is highly probable that a significant reversal in the amount of
revenue recognised will not occur.
Sale of Inventory
Revenue recognised at a point in time is only 0.4% of the
Group’s trading revenue. This is noted under note 3.2
Operating Segments and refers only to Interquip revenues
of which 5% of their trading revenues comprise the sale of
inventory. At the point of recognising the revenue the Group
has agreed the price of the transaction, transferred the
physical asset and the customer has accepted control of the
asset and its intended use of the asset.
Other Revenue
Other revenue and other income primarily includes profit or
loss on sale of assets or investments, dividends received,
government rebates (including diesel fuel rebates) and
interest income which is recognised on an accrual basis.
An amount of $885k JobKeeper payment was received in
FY21 from the Government for the Civil and Infrastructure
businesses in Victoria that were significantly affected by
COVID-19. Including this JobKeeper payment, the COVID-19
impact has contributed to the loss-making of Civil and
Infrastructure segment disclosed in note 3.2.
All dividends received are recognised as revenue when the
right to receive the dividend has been established.
All revenue is stated net of the amount of goods and services
tax (GST).
73
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
3.1 REVENUE (CONTINUED)
The following is an analysis of the Group’s revenue and other income for the year:
Continuing Operations
3.1(a) Revenue from Operating Activities
Contract Trading Revenue
Interest Received
Other Revenue
Total Revenue from Operating Activities
3.1(b) Other Income
Profit / (Loss) on Disposal of Property, Plant and Equipment
Profit / (Loss) on Sale of Investments
Rebates
Total Other Income
3.2 OPERATING SEGMENTS
Identifi cation of Reportable Segment
The Group identifies its operating segments based on
internal reports that are reviewed and used by the Board
of Directors (chief operating decision maker) in assessing
performance and determining the allocation of resources.
The Group operates in three businesses and currently
three geographical segments. The business segments are
for the provision of contract mining, civil & infrastructure,
and structural, mechanical and piping (through Interquip)
services to the resource sector. The three geographical
segments being Australia, Brazil and Cambodia. Operations
in Brazil have been discontinued since the prior year and
are presented separately in the table below. Operations in
Cambodia have commenced in the current year.
Basis of Accounting for Purposes of Reporting
by Operating Segments
Accounting Policies Adopted
Unless otherwise stated, all amounts reported to the Board
of Directors as the chief operating decision maker, are in
accordance with accounting policies that are consistent to
those adopted in the financial statements of the Group.
Inter-segment transactions
Inter-segment loans payable and receivable are initially
recognised at the consideration received net of transaction
costs. If inter-segment loans receivable and payable are
not on commercial terms, these are not adjusted to fair
30 June
2021
30 June
2020
Section
$’000
$’000
1,173,423
79
418
1,173,920
790,058
3,223
2,474
795,755
1,020
-
35,659
36,679
3,402
(299)
34,910
38,013
value based on market interest rates. This policy represents
a departure from that applied to the statutory financial
statements.
Segment assets
Where an asset is used across multiple segments, the asset
is allocated to the segment that receives the majority of
economic value from the asset. In the majority of instances,
segment assets are clearly identifiable on the basis of their
nature and physical location.
Unless indicated otherwise in the segment assets note,
investments in financial assets, deferred tax assets and
intangible assets have not been allocated to operating
segments.
Segment liabilities
Liabilities are allocated to segments where there is direct
nexus between the incurrence of the liability and the
operations of the segment. Segment liabilities include trade
and other payables and certain direct borrowings.
Unallocated items
The following items of revenue and expense are not
allocated to operating segments as they are not considered
part of the core operations of any segment:
- Dividends, interest, foreign exchange, head office and
other administration expenditure.
MACA LIMITED ANNUAL REPORT 2021
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
3.2 OPERATING SEGMENTS (CONTINUED)
Consolidated - June 2021
Revenue
Reportable Segment Revenue
Other Revenue
Total Revenue
EBITDA*
Depreciation and Amortisation
EBIT
Non-Recurring Transactions
Interest Revenue
Finance Costs
Net Profi t/(Loss) Before Tax
Income Tax Expense
Net Profi t Aft er Tax
Net Loss After Tax from Discontinued Operations
Profi t / (Loss) for the Year
Assets
Segment Assets
Total Assets
Liabilities
Segment Liabilities
Total Liabilities
Mining
Civil/
Infrastructure Interquip^ Unallocated
Total
$’000
$’000
$’000
$’000
$’000
870,524
36,606
907,130
153,369
(92,883)
60,486
(15,586)
66
(8,383)
36,583
210,263
22
210,285
(960)
(1,747)
(2,707)
-
8
(101)
(2,800)
95,573
51
95,624
10,924
(1,309)
9,615
(3,221)
-
(37)
6,357
(2,440)
1,173,920
-
(2,440)
36,679
1,210,599
(1,252)
-
(1,252)
162,081
(95,939)
66,142
(2,445)
(21,252)
5
-
(3,692)
860,390
60,802
40,952
46,697
554,191
38,032
26,481
2,529
79
(8,521)
36,448
(11,246)
25,202
(4,472)
20,730
1,008,841
1,008,841
621,233
621,233
Capital Expenditure
277,664
1,056
3,406
-
282,126
*EBITDA is Earnings Before Interest, Income Tax, Depreciation, Non-Recurring Transactions and Amortisation of Continuing
Operations.
1Non-Recurring Transactions include one-off Mining West acquisition costs, gain on business combination, forex losses and
Bluff cessation costs.
Disaggregation of Revenue
^ 5% of Interquip segment revenue has been derived at a point in time. This represents only 0.4% of the Group’s total
trading revenue. All other Group revenue is derived over time.
75
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
3.2 OPERATING SEGMENTS (CONTINUED)
Consolidated - June 2020
Revenue
Reportable Segment Revenue1
Other Revenue
Total Revenue
EBITDA*
Depreciation and Amortisation
EBIT
Non-Recurring Transactions^
Interest Revenue
Finance Costs
Net Profi t/(Loss) Before Tax
Income Tax Expense
Net Profi t Aft er Tax
Net Loss After Tax from Discontinued Operations
Profi t / (Loss) for the Year
Assets
Segment Assets
Total Assets
Liabilities
Segment Liabilities
Total Liabilities
Mining
Civil/
Infrastructure
Interquip Unallocated
Total
$’000
$’000
$’000
$’000
$’000
570,774
36,324
607,098
111,698
(66,248)
45,450
(48,415)
1,785
(6,235)
(7,415)
191,173
(42)
191,131
30,797
(3)
30,794
3,011
795,755
1,734
4,745
38,013
833,768
13,083
2,105
(1,285)
11,798
(3,187)
24
(156)
8,479
(1,021)
1,084
-
4
(53)
1,035
2,584
-
2,584
129,470
(68,554)
60,916
-
(51,602)
1,410
(24)
3,970
466,084
71,260
21,463
68,986
262,480
49,749
4,185
1,719
3,223
(6,468)
6,069
(2,486)
3,583
(21,039)
(17,456)
627,793
627,793
318,133
318,133
Capital Expenditure
117,975
6,037
513
-
124,525
1Excludes revenue of $12.2m from discontinued operation from Brazil
*EBITDA is Earnings Before Interest, Income Tax, Non-Recurring Transactions, Depreciation and Amortisation of Continuing
Operations
^In relation to the impairment of receivables and goodwill.
MACA LIMITED ANNUAL REPORT 2021
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
3.2 OPERATING SEGMENTS (CONTINUED)
Geographical Information
Australia
Cambodia
Brazil (Discontinued Operations)
Total
Major Customers
30 June
2021
$’000
30 June
2020
$’000
30 June
2021
$’000
30 June
2020
$’000
1,157,118
795,755
16,802
211
1,174,131
-
12,186
807,941
518,898
29,445
1
548,344
333,292
-
10,426
343,718
The Group has a number of customers to whom it provides both products and services. The Group supplies 3 single external
customers in the mining segment which account for 20.6%, 9.4% and 7.3% of external revenue. (2020: 31.4%, 10.9% and
8.5%). The next most significant client across the Group accounts for 6.7% (2020: 10.9%) of external revenue.
3.3 OPERATING COSTS FROM CONTINUING OPERATIONS
Expenses
Depreciation and Amortisation
– Plant and Equipment
– Motor Vehicles
– Other
Total Depreciation and Amortisation Expense*
*The amount above excludes the depreciation of $23k (2020: $3.46m) for discontinued operations.
30 June
30 June
2021
$’000
2020
$’000
Section
91,418
1,271
3,250
95,939
65,582
509
2,463
68,554
444,075
105,194
179,746
72,799
66,601
165,756
1,130,110
289,988
55,360
129,244
48,125
34,848
121,881
748,000
5.3
4.5
3,221
-
3,221
48,415
3,187
51,602
Employee Benefits Expense
Repairs, Service and Maintenance
Materials and Supplies
Hire of Plant and Equipment
Subcontractor Costs
Others
Total Direct Costs
Comparatives for operating costs do not include Mining West.
Impairment of Assets
Impairment of Receivables
Impairment of Goodwill
Total Impairment
77
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
3.4 CAPITAL AND LEASING COMMITMENTS
Accounting Policies
Leases
AASB 16 Leases was adopted by the Group at 1 July 2019 and contains significant changes to the accounting treatment
of leases around how to recognise, measure and disclose. The new standard provides a single lessee accounting model,
requiring lessees to recognise assets and liabilities for all leases, with exception of short term (less than 12 months) and low
value leases.
The Group manages its owned and leased assets to ensure there is an appropriate level of equipment to meet its current
obligations and to tender for new work. The decision as to whether to lease or purchase an asset is dependent on the finance
available at the time and the residual risk of ownership following the anticipated completion of the project.
(a) Capital Expenditure Commitments
Plant and Equipment Purchases
Payable
– Not Later Than 12 Months
– Between 12 Months and 5 Years
– Greater Than 5 Years
Total Minimum Commitments
30 June
2021
$’000
30 June
2020
$’000
28,384
-
-
28,384
40,300
-
-
40,300
$28.4m of commitments for property, plant and equipment expenditure existed at 30 June 2021 (2020: $40.3m). These
commitments are largely associated with the Karlawinda project for Capricorn Metals Ltd.
3.5 AUDITOR’S REMUNERATION
Auditor’s Remuneration - Moore Australia (WA)
Auditor’s Remuneration - Moore Australia (WA)
Audit or Review of the Financial Report
Audit or Review of the Financial Report
Other Non-Audit Services
Other Non-Audit Services
Taxation Services
Taxation Services
Total Auditor’s Remuneration
Total Auditor’s Remuneration
30 June
30 June
30 June
30 June
20212021
$’000
$’000
20202020
$’000
$’000
245
245
239
239
- -
- -
- -
- -
245
245
239
239
MACA LIMITED ANNUAL REPORT 2021
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Current tax assets and liabilities are offset where a legally
enforceable right of set-off exists and it is intended that net
settlement or simultaneous realisation and settlement of the
respective asset and liability will occur. Deferred tax assets
and liabilities are offset where a legally enforceable right of
set-off exists, the deferred tax assets and liabilities relate to
income taxes levied by the same taxation authority on either
the same taxable entity or different taxable entities where it
is intended that net settlement or simultaneous realisation
and settlement of the respective asset and liability will occur
in future periods in which significant amounts of deferred tax
assets or liabilities are expected to be recovered or settled.
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the
amount of GST, except where the amount of GST incurred is
not recoverable from the Australian Taxation Office. In these
circumstances the GST is recognised as part of the cost of
acquisition of the asset or as part of an item of the expense.
Receivables and payables in the statement of financial
position are shown inclusive of GST.
Cash flows are presented in the statement of cashflows on a
gross basis, except for the GST component of investing and
financing activities, which are disclosed as operating cash
flows.
FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
3.6 TAXATION
Accounting Policies
Income tax
The income tax expense (revenue) for the year comprises
current income tax expense (income) and deferred tax
expense (income).
Current income tax expense charged to the profit or loss
is the tax payable on taxable income calculated using
applicable income tax rates enacted, or substantially
enacted, as at the end of the reporting period. Current tax
liabilities (assets) are therefore measured at the amounts
expected to be paid to (recovered from) the relevant taxation
authority.
Deferred income tax expense reflects movements in deferred
tax asset and deferred tax liability balances during the year
as well as unused tax losses. Current and deferred income
tax expense (income) is charged or credited directly to equity
instead of the profit or loss when the tax relates to items that
are credited or charged directly to equity.
Deferred tax assets and liabilities are ascertained based
on temporary differences arising between the tax bases
of assets and liabilities and their carrying amounts in the
financial statements. Deferred tax assets also result where
amounts have been fully expensed but future tax deductions
are available. No deferred income tax will be recognised
from the initial recognition of an asset or liability, excluding a
business combination, where there is no effect on accounting
or taxable profit or loss.
Deferred tax assets and liabilities are calculated at the tax
rates that are expected to apply to the period when the
asset is realised or the liability is settled, based on tax rates
enacted or substantively enacted at the end of the reporting
period. Their measurement also reflects the manner in which
management expects to recover or settle the carrying amount
of the related asset or liability.
Deferred tax assets relating to temporary differences and
unused tax losses are recognised only to the extent that it is
probable that future taxable profit will be available against
which the benefits of the deferred tax asset can be utilised.
Where temporary differences exist in relation to investments
in subsidiaries, branches, associates, and joint ventures,
deferred tax assets and liabilities are not recognised where
the timing of the reversal of the temporary difference can be
controlled and it is not probable that the reversal will occur in
the foreseeable future.
79
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
3.6 TAXATION (CONTINUED)
Continuing Operations
3.6.1 Income Tax Expense
(a) The Components of Tax Expense Comprise:
Current
Deferred
Income Tax Expense
Section
3.6.3 (a)
(b) Reconciliation:
Prima Facie Tax Payable on Profit From Ordinary Activities Before Income Tax at 30% (2020: 30%)
Add Tax Effect of
– Dividend Imputation
– Other Non-Allowable Items
– Other Taxable Items
– Under/(Over) provision of Prior Years’ Tax Expense
Less Tax Effect of
– Franking Credits on Dividends Received
– Other Deductible Items
Income tax attributable to the Group
The Applicable Weighted Average Effective Tax Rate as
30 June
2021
$’000
30 June
2020
$’000
8,920
2,326
11,246
16,858
(14,372)
2,486
10,935
1,821
1,960
411
5,007
(441)
(6,533)
(93)
11,246
31%
1,723
412
5,017
(277)
(5,743)
(467)
2,486
41%
3.6.2 Tax Assets and Liabilities
(a) Tax Assets
Non-Current
Deferred Tax Assets comprise:
Provisions
Losses
Other
Total Non-Current Tax Assets
(b) Tax Liabilities
Current
Income tax
Total Current Tax Liabilities
Non-Current
Deferred Tax Liabilities comprises:
Depreciation
Other
Total Non-Current Tax Liabilities
30 June
2021
$’000
30 June
2020
$’000
Section
3.6.3(c)
3.6.3(c)
3.6.3(c)
17,054
7,054
4,309
28,417
5,725
2,733
15,101
23,559
10
10
2,169
2,169
3.6.3(b)
1,099
-
1,099
-
-
-
MACA LIMITED ANNUAL REPORT 2021
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
3.6 TAXATION (CONTINUED)
30 June
2021
$’000
30 June
2020
$’000
Section
3.6.3 Reconciliations
(a) Gross Movements
The Overall Movement In the Deferred Tax Account is as follows:
Opening Balance
(Charge)/Credit To Income Statement
(Charge)/Credit To Equity
Acquisition through business combination 6.1
Closing Balance
23,559
(2,326)
1,075
5,010
27,318
9,187
14,372
-
-
23,559
(b) Deferred Tax Liabilities
The Movement In Deferred Tax Liabilities For Each Temporary Difference During the Year is as follows:
Depreciation and Other:
Opening Balance
Charge/(Credit) To Income Statement
Charge/(Credit) To Equity
Closing Balance
-
1,099
-
1,099
4,326
(4,326)
-
-
(c) Deferred Tax Assets
The Movement In Deferred Tax Assets For Each Temporary Difference During the Year is as follows:
Provisions:
Opening Balance
Acquisition through business combination 6.1
(Charge) / Credit to Equity
Credit To Income Statement
Closing Balance
Losses:
Opening Balance
(Charge)/Credit To Income Statement
Closing Balance
Other:
Opening Balance
(Charge)/Credit To Income Statement
Charge/(Credit) To Equity
Closing Balance
\
5,725
5,010
1,075
5,244
17,054
2,733
4,321
7,054
15,101
(10,792)
-
4,309
4,671
-
-
1,054
5,725
8,293
(5,560)
2,733
549
14,552
-
15,101
81
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
3.7 PROFIT / (LOSS) FROM DISCONTINUED OPERATIONS
Accounting Policies
A discontinued operation is a component of the entity
that either has been disposed of, ceased operation or is
classified as held for sale, and
- represents a separate major line of business or
geographical area of operations;
- is part of a single coordinated plan to dispose of a separate
major line of business or geographical area of operations; or
- is a subsidiary acquired exclusively with a view to resale.
Profit or loss from discontinued operations, including prior
year components of profit or loss, is presented in a single
amount in the Consolidated Statement of Profit or Loss and
Other Comprehensive Income. This amount comprises the
post-tax profit or loss of discontinued operations and the
Revenue
Other Income
Direct Costs
Impairment of Receivables
Finance Costs
Foreign Exchange Gains / (Losses)
Profit / (Loss) Before Income Tax
Income Tax Expense
Profit / (Loss) After Tax from Discontinued Operations
post-tax gain or loss resulting from the measurement and
disposal of assets classified as held for sale (if any).
Discontinued Operations
On 21 January 2020, the Group announced the cessation
of the operations in Brazil. This followed the termination of
the contract at Antas for AVB Mineracao Ltda, a subsidiary
of Oz Minerals Ltd. The Group had relocated the plant and
equipment back to Australia for deployment to existing and
new projects.
The financial performance of the discontinued operations,
is included in profit / (loss) from discontinued operations
on the face of Consolidated Statement of Profit or Loss and
Other Comprehensive Income, is as follows:
30 June
2021
$’000
30 June
2020
$’000
Section
5.3
211
102
(3,051)
(981)
-
53
(3,666)
-
(3,666)
12,186
211
(21,426)
(1,952)
(365)
(2,358)
(13,704)
3,232
(10,472)
The net cash flows of the discontinued operations, which have been incorporated into the Consolidated Statement of Cash
Flows, are as follows:
Net Cash Provided By / (Used In) Operating Activities
Net Cash Provided By / (Used In) Investing Activities
Net Cash Provided By / (Used In) Financing Activities*
Net Cash Increase / (Decrease) in Cash Held
10,558
859
(7,508)
3,909
27,240
1,603
(38,778)
(9,935)
*Included in the net cash used in financing activities for the year ended 30 June 2021, is an amount of $7.5m (2020: $29.3m)
loan repayment made to the parent entity.
MACA LIMITED ANNUAL REPORT 2021
82
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
3.8 EARNINGS PER SHARE
Accounting Policies
Basic EPS
Basic EPS is calculated by dividing the profit attributable to equity holders of the Company, excluding any costs of servicing
equity other than ordinary shares, by the weighted average number of ordinary shares during the financial year.
Diluted EPS
Diluted EPS is calculated by dividing the profit attributable to equity holders of the Company, excluding any costs of
servicing equity other than ordinary shares, by the weighted average number of ordinary shares and performance rights for
the effects of all dilutive potential ordinary shares.
Reconciliation Of Earnings To Profi t and Loss
Profit After Tax from Continuing Operations
(Profit) / Loss Attributable To Non-Controlling Interest
Profit Attributable to Members of Parent Entity from Continuing Operations
Profit / (Loss) Attributable to Members of Parent Entity from Discontinued Operations
Profit / (Loss) Attributable to Members of Parent Entity from Continuing and Discontinued
Operations
From Continuing and Discontinued Operations
Earnings Used To Calculate Basic EPS
Earnings Used in the Calculation of Dilutive EPS
From Continuing Operations
Earnings Used To Calculate Basic EPS
Earnings Used in the Calculation of Dilutive EPS
From Discontinued Operations
Earnings Used To Calculate Basic EPS
Earnings Used in the Calculation of Dilutive EPS
Weighted Avg. No. of Ord. Shares Outstanding During the Year (Basic EPS) (’000)
Weighted Average Number of Dilutive Options Outstanding (’000)
Weighted Avg. No. of Ord. Shares Outstanding During the Year (Diluted EPS) (’000)
30 June
2021
$’000
30 June
2020
$’000
25,202
(1,784)
23,418
(4,472)
3,583
(418)
3,165
(21,039)
18,946
(17,874)
18,946
18,946
(17,874)
(17,874)
23,418
23,418
3,165
3,165
(4,472)
(4,472)
(21,039)
(21,039)
305,418
268,008
4,985
310,403
3,879
271,887
83
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
SECTION 4 ASSETS AND LIABILITIES
This Section shows the assets used to generate the Group’s trading performance and the liabilities incurred as a result.
Liabilities relating to the Group’s financing activities are addressed in Section 5.
4.1 TRADE AND OTHER RECEIVABLES, LOANS TO OTHER COMPANIES AND OTHER FINANCIAL ASSETS
Accounting Policies
Trade and other receivables represent the asset outstanding at the end of the reporting period for goods and services
provided by the Group during the reporting period which remain unpaid. The balance is recognised as a current asset with
the amount normally being received within 30 to 60 days of recognition of the receivable. The Group’s impairment loss
allowance accounting policy for receivables is outlined in note 5.3.
Trade and Other Receivables
Trade and Other Debtors - Current
Less: Provision for Impairment
Section
5.3
Debtors Subject to Payment Arrangements - Current
Total Current
Debtors Subject to Payment Arrangements - Non-Current
Total Trade and Other Receivables
Loans to Other Companies
Loans to Other Companies - Current
Loans to Other Companies - Non-Current
Total Loans to Other Companies
Other Financial Assets
Shares in Listed Corporations at Fair Value - Current
Shares in Listed Corporations at Fair Value - Non-Current
Total Other Financial Assets
30 June
2021
$’000
30 June
2020
$’000
281,543
(981)
280,562
4,089
284,651
9,469
294,120
191,554
(48,415)
143,139
11,190
154,329
-
154,329
-
26,841
26,841
-
26,841
26,841
30
-
30
69
-
69
MACA LIMITED ANNUAL REPORT 2021
84
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
4.1 TRADE AND OTHER RECEIVABLES, LOANS TO OTHER COMPANIES AND OTHER FINANCIAL ASSETS (CONTINUED)
Credit Risk
The Group has approximately 14% (2020: 22%) of post-impairment credit risk with a single counterparty or group of
counterparties. Failure or default of a major counterparty would have a material impact on earnings. Management of credit
risk is discussed in Section 5.3 Financial Risk Management. The class of assets described as “trade and other receivables”
and “loans to other companies” are considered to be the main source of credit risk related to the Group.
The following table details the Group’s trade and other receivables exposed to credit risk (prior to collateral and other credit
enhancements) with ageing analysis and impairment provided for thereon. Amounts are considered as ‘past due’ when the
debt has not been settled within the terms and conditions agreed between the Group and the customer or counterparty to
the transaction. Receivables that are past due are assessed for impairment by ascertaining solvency of the debtors and are
provided for where there are specific circumstances indicating that the debt may not be fully repaid to the Group.
The balance of receivables that remain within initial trade terms (as detailed in the table) are considered to be of acceptable
credit quality.
30 June 2021
Trade and Term Receivables
Other Receivables
Total Trade and Other Receivables
30 June 2020
Trade and Term Receivables
Other Receivables
Total Trade and Other Receivables
Receivables and Loans as Financial Assets measured
at Amortised Cost
Trade and Other Receivables
- Total Current (net of impairment)
- Total Non-Current
Total Trade and Other Receivables
Loans to Other Companies
- Total Current
- Total Non-Current (Secured)*
Total Loan to Other Companies
Gross
amount
$’000
Past due
and impaired
Past due but
not impaired
Within initial
trade terms
$’000
$’000
$’000
277,777
20,545
298,322
(4,202)
-
(4,202)
198,049
4,695
202,744
(48,415)
-
(48,415)
28,749
-
28,749
18,806
-
18,806
244,826
20,545
265,371
130,828
4,695
135,523
30 June
2021
$’000
30 June
2020
$’000
284,651
9,469
294,120
-
26,841
26,841
154,329
-
154,329
-
26,841
26,841
* Loan to Carabella Resources Pty Ltd has first ranking securities over the company assets, being mining and exploration
tenements.
85
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
4.2 INVENTORY AND WORK IN PROGRESS (WIP)
Accounting Policies
Inventory and work in progress are measured at the lower of cost or net realisable value. The cost of manufactured products
includes direct materials, direct labour and an appropriate portion of variable and fixed overheads. Overheads are applied on
the basis of normal operating capacity. Costs are assigned on the basis of weighted average costs.
A WIP Liability is recognised when the customer pays consideration before the Group recognises the related revenue
as set out in Note 3.1(a). A WIP Liability would also be recognised if the Group has an unconditional right to receive the
consideration before the Group recognises the related revenue. In such cases, a corresponding receivable would also be
recognised.
Inventory and Work In Progress (WIP)
Inventory*
WIP - Income Received in Advance
Total Inventory and Work in Progress (WIP)
30 June
2021
$’000
30 June
2020
$’000
49,914
(4,862)
45,052
12,494
(3,017)
9,477
*On 1st February 2021 inventory of $40m acquired through business combination (Refer to Note 6.1).
WIP Liabilities primarily relate to the Group’s obligation to transfer goods or services to customers for which the Group has
received advances from customers for construction contracts and progress billings issued in excess of the Group’s rights to
the consideration in respect of construction contract revenue.
4.3 OTHER ASSETS
Other Assets
Prepayments
Deposit*
Loan Establishment Fee^
Total Other Assets - Current
Loan Establishment Fee^
Total Other Assets - Non-Current
30 June
2021
$’000
30 June
2020
$’000
2,565
5,528
325
8,418
1,175
1,175
777
4,773
-
5,550
-
-
*Included in the deposit balance as at 30 June 2021, amount of $4.6m was cash deposit-backed security bonds.
^In relation to the $130m loan from Commonwealth Bank of Australia for the acquisition of Mining West and being
amortised over the remaining period of the loan.
MACA LIMITED ANNUAL REPORT 2021
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
4.4 PROPERTY, PLANT AND EQUIPMENT
Accounting Policies
Each class of property, plant and equipment is carried at
cost or fair value as indicated less, where applicable, any
accumulated depreciation and impairment losses.
Property
Freehold land and buildings are shown at their fair value
(being the amount for which an asset could be exchanged
between knowledgeable willing parties in an arm’s length
transaction), less subsequent depreciation for buildings.
Increases in the carrying amount arising on revaluation of
land and buildings are credited to a revaluation surplus
in equity. Decreases that offset previous increases of the
same asset are charged against fair value reserves directly
in equity, all other decreases are charged to the statement
of comprehensive income. Each year the difference between
depreciation based on the revalued carrying amount of
the asset charged to the statement of profit or loss and
other comprehensive income and depreciation based on
the asset’s original cost is transferred from the revaluation
reserve to retained earnings. Any accumulated depreciation
at the date of revaluation is eliminated against the gross
carrying amount of the asset and the net amount is restated
to the revalued amount of the asset.
Plant and equipment
Plant and equipment are measured on the cost basis.
The carrying amount of plant and equipment is reviewed
annually by directors to ensure it is not in excess of the
recoverable amount from these assets. The recoverable
amount is assessed on the basis of the expected net cash
flows that will be received from the asset’s employment
and subsequent disposal. The expected net cash flows have
been discounted to their present values in determining
recoverable amounts.
The cost of fixed assets constructed within the Group
includes the cost of materials, direct labour, borrowing
costs and an appropriate proportion of fixed and variable
overheads.
Subsequent costs are included in the assets carrying
amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits
87
MACA LIMITED ANNUAL REPORT 2021
associated with the item will flow to the Group and the cost
of the item can be measured reliably. All other repairs and
maintenance are charged to the profit and loss statement
during the financial period in which they are incurred.
Depreciation
The depreciable amount of all fixed assets including
buildings and capitalised lease assets, but excluding
freehold land, is depreciated on a diminishing value or
straight line basis over the asset’s useful life to the Group
commencing from the time the asset is held ready for use.
Leasehold improvements are depreciated over the shorter
of either the unexpired period of the lease or the estimated
useful lives of the improvements.
The depreciation rates used for each class of depreciable
assets are:
Class of Fixed Asset
Depreciation Rate
Leasehold Improvements
2.50%
Plant and Equipment
Low Value Pool
Motor Vehicles
10% – 40.0%
18.75% – 37.5%
18.75% – 50%
The asset’s residual values and useful lives are reviewed, and
adjusted if appropriate, at the end of each reporting period.
An asset’s carrying amount is written down immediately
to its recoverable amount if the asset’s carrying amount is
greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing
proceeds with the carrying amount. These gains and losses
are included in the statement of profit or loss and other
comprehensive income. When revalued assets are sold,
amounts included in the revaluation surplus relating to that
asset are transferred to retained earnings.
Leases
Right-of-use assets are depreciated over the lease term or
useful life of the underlying asset, whichever is the shortest.
Where a lease transfers ownership of the underlying asset
or the cost of the right-of-use asset reflects that the Group
anticipates to exercise a purchase option, the specific asset
is depreciated over the useful life of the underlying asset.
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
4.4 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
Movements in Carrying Amounts
Movements in carrying amounts for each class of property, plant and equipment between the beginning and the end of the
current financial period are as follows:
Plant and Equipment – at Cost
- Owned
- Right-Of-Use Assets
Total Cost
Accumulated Depreciation
- Owned
- Right-Of-Use Assets
Total Accumulated Depreciation
30 June
2021
$’000
30 June
2020
$’000
600,634
318,572
919,206
(344,082)
(115,467)
(459,549)
405,691
276,951
682,642
(325,162)
(82,003)
(407,165)
Carrying Amount - Plant and Equipment
459,657
275,477
Motor Vehicles – at Cost
- Owned
- Right-Of-Use Assets
Total Cost
Accumulated Depreciation
- Owned
- Right-Of-Use Assets
Total Accumulated Depreciation
Carrying Amount - Motor Vehicles
Land and Building
- Owned at Fair Value
- Right-Of-Use Assets
Total
Accumulated Depreciation
- Owned at Fair Value
- Right-Of-Use Assets
Total Accumulated Depreciation
Carrying Amount - Land and Building
Low Value Pool – at Cost
Accumulated Depreciation
Carrying Amount - Low Value Pool
Leasehold Improvements – at Cost
Accumulated Depreciation
Carrying Amount - Leasehold Improvements
Total Carrying Amounts - Owned
Total Carrying Amounts - Right-Of-Use Assets
Total Carrying Amounts - Property, Plant and Equipment
The Group’s lease portfolio includes buildings, plant and equipment and motor vehicles.
3,759
2,619
6,378
(2,992)
(1,507)
(4,499)
1,879
3,272
20,330
23,602
(519)
(7,488)
(8,007)
15,595
567
(456)
111
3,661
(2,124)
1,537
261,720
217,059
478,779
4,370
3,752
8,122
(3,807)
(2,126)
(5,933)
2,189
3,272
16,458
19,730
(487)
(5,018)
(5,505)
14,225
481
(416)
65
2,980
(1,618)
1,362
85,304
208,014
293,318
MACA LIMITED ANNUAL REPORT 2021
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
4.4 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
Options to Extend or Terminate
The options to extend or terminate are contained in several
of the property leases of the Group. There were no extension
options for equipment leases. These clauses provide the
Group opportunities to manage leases in order to align with
its strategies. All of the extension or termination options
are only exercisable by the Group. The extension options or
termination options which management were reasonably
certain to be exercised have been included in the calculation
of the lease liability.
Impairment of Property, Plant and Equipment
The Group monitors market conditions for indications of
impairment of its operating assets. Where a trigger event
occurs which indicates an impairment may have occurred, a
formal impairment assessment is performed. The following
trigger events have occurred at 30 June 2021:
- The carrying amount of the Group’s net assets ($387.6M)
exceeded the Company’s market capitalisation as at 30 June
2021 ($259.3M).
As a result, an assessment has been made of the
recoverable amounts of each of the Operating Segments.
The Group’s Mining Services segment is split into Mining
and Crushing CGU’s for evaluation of impairment. Similarly,
Civil and Infrastructure are also assessed as independent
CGU’s. Cash flows have been projected for 5 years from the
continuing use of assets within each CGU as well as the
disposal of any assets, and have been discounted using a
Weighted Average Cost of Capital (WACC) rate. Projected
future cash flows from the continuing use of assets for FY22
have been based on current contracted work in hand plus
an allowance for estimated new work, thereafter growth has
been allowed at 2.0% with a terminal growth rate of 2.0%
has been applied. The FY21 WACC rate has been applied to
discount the projected cash flows of each of these CGU’s to
measure any impairment.
The assessment has resulted in no impairment to the plant
and equipment employed in the Mining, Crushing, Interquip
and Civil CGUs, but indicated a potential impairment of
assets for infrastructure, further tests performed supported
the carrying value of property, plant and equipment in
Infrastructure CGU. Accordingly, no impairment to property,
plant and equipment has been recognised.
Key Assumptions used for value in use calculations:
- EBITDA Margin
- Discount Rates
- Growth rates used to extrapolate cash flows beyond the
forecast period
- Capital expenditure
The EBITDA Margin is based on management’s best estimate
taking into account past performance and expected market
conditions. Working Capital has been adjusted to reflect the
required working capital for the forecast future cashflows.
Capital expenditure has considered both required
replacement capital and idle equipment which could be
utilised to sustain the current Work in Hand schedule.
Capital expenditure has been matched to depreciation levels
in the terminal year.
As disclosed above management have made judgements
and estimates in respect of impairment testing of plant and
equipment. Any adverse changes to key assumptions may
result in an impairment in the future. The sensitivities are as
follows:
Sensitivity Analysis
Crushing
Mining
Civil
Infrastructure*
Interquip
*Carrying value of assets are supported by valuations
89
MACA LIMITED ANNUAL REPORT 2021
Decrease in Revenue required
to incur an impairment
Increase in Discount Rate
to incur an impairment
14.5%
14.3%
4.2%
0.0%
66.2%
113.3%
132.5%
122.1%
0.0%
145.2%
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
4.4 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
Plant and
Equipment
Motor
Vehicles
Land and
Buildings
Right-Of-
Use Assets
Low Value
Pool
Leasehold
Improvement
Total
Consolidated:
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Balance at 01 July 19
Adoption of AASB 16
231,415
2,694
2,808
-
- Reallocation from PPE
(161,888)
(1,867)
- Recognition of ROUA
Restated Bal. at 01 July 19
Additions
Disposals
Reallocation from ROUA
Forex movements
Depreciation expense
Balance at 30 June 20
Balance at 01 July 20
Additions
Acquisition through
business combination
Disposals
Reallocation from ROUA
Forex movements
Depreciation expense
Balance at 30 June 21
-
69,527
38,231
(5,238)
7,703
(5,100)
(24,594)
80,529
80,529
70,580
135,375
(1,296)
29,198
144
(57,978)
256,552
-
827
12
(79)
-
-
(197)
563
563
479
-
(423)
1,365
-
(1,217)
767
-
-
163,755
13,138
2,808
176,893
-
-
-
-
85,842
-
(7,703)
-
(23)
2,785
(47,018)
208,014
2,785
208,014
-
-
-
-
-
74,925
-
-
(30,563)
-
(32)
2,753
(35,317)
217,059
94
-
-
94
17
-
-
-
(46)
65
65
86
-
-
-
-
(40)
111
AASB 16 related amounts recognised in the income statement for the year ended
Depreciation charge related to right-of-use assets
Interest expense on lease liabilities (under finance cost)
Short-term leases expense
1,269
238,280
-
-
1,269
423
(10)
-
-
(320)
1,362
-
13,138
251,418
124,525
(5,327)
-
(5,100)
(72,198)
293,318
1,362
293,318
681
146,751
-
-
-
-
135,375
(1,719)
-
144
(506)
1,537
(95,090)
478,779
30 June
2021
30 June
2020
$’000
$’000
35,317
7,257
191
47,018
6,834
338
MACA LIMITED ANNUAL REPORT 2021
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
4.5 INTANGIBLE ASSETS
Accounting Policies
Goodwill
Goodwill is carried at cost less any accumulated impairment
losses. Goodwill is calculated as the excess of the sum of:
(i) the consideration transferred;
(ii) any non-controlling interest (determined under either
the full goodwill or proportionate interest method); and
(iii) the acquisition date fair value of any previously held
equity interest;
over the acquisition date fair value of net identifiable assets
acquired.
The acquisition date fair value of the consideration
transferred for a business combination plus the acquisition
date fair value of any previously held equity interest shall
form the cost of the investment in the separate financial
statements.
Fair value remeasurements in any pre-existing equity
holdings are recognised in profit or loss in the period
in which they arise. Where changes in the value of such
equity holdings had previously been recognised in other
comprehensive income, such amounts are recycled to profit
or loss.
The amount of goodwill recognised on acquisition of
each subsidiary in which the Group holds less than 100%
interest will depend on the method adopted in measuring
the non-controlling interest. The Group can elect in most
circumstances to measure the non-controlling interest in
the acquiree either at fair value (full goodwill method) or
at the non-controlling interest’s proportionate share of the
subsidiary’s identifiable net assets (proportionate interest
method). In such circumstances, the Group determines
which method to adopt for each acquisition and this is
stated in the respective notes to these financial statements
disclosing the business combination.
Under the full goodwill method, the fair value of the non-
controlling interest is determined using valuation techniques
which make the maximum use of market information where
available. Under this method, goodwill attributable to the
non-controlling interest is recognised in the consolidated
financial statements.
91
MACA LIMITED ANNUAL REPORT 2021
Goodwill on acquisition of subsidiaries is included in
intangible assets. Goodwill on acquisition of associates is
included in investments in associates.
Goodwill is tested for impairment annually and is allocated
to the Group’s cash-generating units or groups of cash-
generating units, representing the lowest level at which
goodwill is monitored and not larger than an operating
segment. Gains and losses on the disposal of an entity
include the carrying amount of goodwill related to the entity
disposed of.
Changes in the ownership interests in a subsidiary that do
not result in a loss of control are accounted for as equity
transactions and do not affect the carrying amounts of
goodwill.
Impairment of Assets
At the end of each reporting period, the Group assesses
whether there is any indication that an asset may be
impaired. The assessment will include the consideration
of external and internal sources of information including
dividends received from subsidiaries, associates or jointly
controlled entities deemed to be out of pre-acquisition
profits. If such an indication exists, an impairment test
is carried out on the asset by comparing the recoverable
amount of the asset, being the higher of the asset’s fair
value less costs to sell and value in use, to the asset’s
carrying value. Any excess of the asset’s carrying value over
its recoverable amount is expensed to the statement of
profit or loss and other comprehensive income.
Where it is not possible to estimate the recoverable amount
of an individual asset, the Group estimates the recoverable
amount of the cash-generating unit to which the asset
belongs.
Allocation of Goodwill to Cash Generating Unit
Goodwill is allocated to the Group’s cash generating units
identified according to operating segment. Goodwill is not
amortised but is subject to impairment testing on an annual
basis or whenever there is an indication of impairment.
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
4.5 INTANGIBLE ASSETS (CONTINUED)
Impairment Test for Goodwill
The Group does not hold any goodwill arising from the business combinations.
Intangible Assets - Customer Contracts
The acquisition price of Mining West sites was based on the fair value of inventory, plant and equipment, using an
independent valuation. The customer contracts ceded to MACA were valued based on the expected net results and
discounted using MACA’s Weighted Average Cost of Capital (“WACC”) to present value. Management believe the customer
contracts are fully recoverable and as a result, an intangible has been recognised and amortised on a straight-line basis over
the average duration of the contracts, which is 26 months from its acquisition date, see table below.
Goodwill
MACA Infrastructure
Less: Accumulated Impairment Losses
Goodwill Carrying Amount
Customer Contracts
Acquisition through business combination
Less: Accumulated Amortisation
Customer Contracts Carrying Amount
30 June
2021
$’000
Section
-
-
-
30 June
2020
$’000
3,187
(3,187)
Section
6.1
30 June
2021
$’000
30 June
2020
$’000
4,535
(872)
3,663
-
-
-
-
MACA LIMITED ANNUAL REPORT 2021
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
4.6 TRADE AND OTHER PAYABLES
Accounting Policies
Trade and other payables represent the liability outstanding at the end of the reporting period for goods and services
received by the Group during the reporting period which remains unpaid. The balance is recognised as a current liability
with the amount being normally paid within 45 days of recognition of the liability.
Payables
Current
Unsecured Liabilities:
Trade Creditors
Sundry Creditors and Accruals
Total Trade and Other Payables
Secured Liabilities:
Deferred Consideration Payable - Downer EDI
Total Payables
30 June
2021
$’000
30 June
2020
$’000
Section
157,260
89,362
80,388
31,528
246,622
111,916
6.1
38,500
-
285,122
111,916
Except for the deferred consideration payable to Downer EDI, payables are settled at various terms up to 45 days.
All payables are non-interest bearing.
Payables as Financial Liabilities measured at Amortised Cost
Section
$’000
30 June
2021
30 June
2020
$’000
Payables
- Total Current
- Total Non-Current
Total Payables
285,122
111,916
-
-
285,122
111,916
93
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
4.7 PROVISIONS
Accounting Policies
Employee Benefi ts
Provision is made for the Group’s liability for employee benefits arising from services rendered by employees to balance
date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be
paid when the liability is settled. Employee benefits payable later than one year have been measured at the present value
of the estimated future cash outflows to be made for those benefits. In determining the liability, consideration is given to
employee wages increases and the probability that the employee may satisfy vesting requirements. Those cash outflows
are discounted using market yields on national government bonds with terms to maturity that match the expected timing of
cash flows.
Provisions
Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for which it is
probable that an outflow of economic benefits will result and that outflow can be reliably measured.
Employee Entitlements
Movement in Provisions
Opening Balance
Additional Provisions
Acquisition through business combination
Amounts Used
Closing balance
Section
30 June
2021
$’000
30 June
2020
$’000
32,431
15,976
6.1
15,976
4,606
16,704
(4,855)
32,431
13,657
11,714
-
(9,395)
15,976
MACA LIMITED ANNUAL REPORT 2021
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
SECTION 5 CAPITAL STRUCTURE AND FINANCING COSTS
This Section outlines how the Group manages its capital structure, including its balance sheet liquidity and access to capital
markets.
The Directors determine the appropriate capital structure of MLD, specifically, how much is raised from shareholders (equity)
and how much is borrowed from financial institutions (debt) in order to finance the Group’s activities both now and in the
future. The Directors consider the Group’s capital structure and dividend policy at least annually and do so in the context of
its ability to continue as a going concern, to execute the strategy and to deliver its business plan.
5.1 CASH AND CASH EQUIVALENTS
Accounting Policies
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments
with original maturities of three months or less, and bank overdrafts. The Group does not have any bank overdraft facilities.
5.1.1 CASH AND CASH EQUIVALENTS
Cash and Cash Equivalents
Term Deposit-Convertable to cash*
Total Cash and Cash Equivalents
30 June
2021
$’000
30 June
2020
$’000
Section
102,346
114,650
20,000
-
122,346
114,650
* Classified as cash & cash equivalents as the term deposit can be readily converted to cash.
5.1.2 CASH FLOW INFORMATION
Reconciliation of Cash Flow from Operations with Profi t / (Loss) for the Year
Profit / (Loss) for the Year
Non-Cash Flows in Profi t
Depreciation and Amortisation
Impairment
Net (Gains) / Losses on Disposal of Plant and Equipment
Fair value losses on Financial Assets
Gain on Business Combination
Foreign Exchange (Gains) / Losses
Total Non-Cash Flows in Profit
Movements in Working Capital
(Increase) / Decrease in Trade and Other Receivables
(Increase) / Decrease in Other Assets
(Increase) / Decrease in Inventories and Work-In-Progress
Increase / (Decrease) in Trade and Other Payables
Increase / (Decrease) in Income Tax Payable
Increase / (Decrease) in Deferred Tax
Increase / (Decrease) in Provisions
Total Working Capital Movements
Net Cash Increase / (Decrease) from Operating Activities
95
MACA LIMITED ANNUAL REPORT 2021
4.4, 4.5
3.3, 3.7
20,730 (17,456)
95,962
4,202
(1,119)
72,198
53,554
(2,165)
39
(846)
6.1
(4,535)
-
2,114
13,560
96,663
136,301
(132,678)
(13,143)
(3,944)
(4,026)
8,591
432
130,544
28,136
(2,159)
(1,562)
1,252 (14,371)
(249)
1,357
2,319
(2,215)
118,750
116,630
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.1 CASH AND CASH EQUIVALENTS (CONTINUED)
5.1.3 NON-CASH FINANCING AND INVESTING ACTIVITIES
During the year the Group acquired $50.9 million in plant and equipment (2020: $61.1m) by means of finance leases
(included in right-of-use assets), directly from original equipment manufacturers. These acquisitions are not reflected in the
statement of cash flows.
Refer to Note 6.1 Business Combinations for the details of business combination during the year ended 30 June 2021.
Shares Issued
58,530,982 and 15,172,156 new shares were issued at $1.02 per share on 23 December 2020 and 15 January 2021
respectively for the acquisition of Mining West.
Insurance Bonding and Bank Guarantee Facilities
The Group has insurance bonding and bank guarantee facilities totalling $63.2 million. At 30 June 2021 the amount drawn on
the facilities was $29.1 million (2020: $23.6 million).
5.2 INTEREST BEARING LIABILITIES
Accounting Policies
Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a
substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until such time as
the assets are substantially ready for their intended use or sale.
All other borrowing costs are recognised in the statement of profit and loss in the period in which they are incurred.
5.2.1 FINANCIAL LIABILITIES MEASURED AT AMORTISED COST
Current
Secured Lease Liability
Secured Bank Loan
Unsecured Lease Liability
Total Current Interest Bearing Liabilities
Non-Current
Secured Lease Liability
Secured Bank Loan
Unsecured Lease Liability
Total Non-Current Interest Bearing Liabilities
Total Current and Non-Current Interest Bearing Liabilities
30 June
2021
$’000
30 June
2020
$’000
Section
68,080
26,000
3,251
97,331
52,941
-
2,186
55,127
103,550
91,000
10,690
205,240
122,772
-
10,173
132,945
302,571
188,072
The bank loan is secured by the first ranking general security interest over all present and after acquired property (including
all shares held in any subsidiary).
During FY21, the Group complied with all the financial covenants of its borrowing facilities.
MACA LIMITED ANNUAL REPORT 2021
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.3 FINANCIAL RISK MANAGEMENT
The Group’s financial instruments consist mainly of deposits
with banks, local money market instruments, short-term
investments, accounts receivable and payable, loans to and
from subsidiaries, WIP liability, loans to other companies
and leases.
The totals for each category of financial instruments,
measured in accordance with AASB 139 as detailed in the
accounting policies to these financial statements are as
follows:
Accounting Policies
The Board of Directors (“the Board”) is responsible for,
amongst other issues, monitoring and managing financial
risk exposures of the Group. The Board monitors the
Group’s financial risk management policies and exposures
and approves financial transactions within the scope of
its authority. It also reviews the effectiveness of internal
controls relating to commodity price risk, counterparty credit
risk, liquidity risk, currency risk, financing risk and interest
rate risk.
The Board’s overall risk management strategy seeks
to assist the Group in meeting its financial targets,
while minimising potential adverse effects on financial
performance. Its functions include the review of the use of
hedging derivative instruments (if any), credit risk policies
and future cash flow requirements.
Specifi c Financial Risk Exposures and Management
The main risks the Group is exposed to through its financial
instruments are credit risk, liquidity risk and market risk
consisting of interest rate risk, foreign currency risk and
equity price risk.
Credit Risk
Exposure to credit risk relating to financial assets arises from
the potential non-performance by counterparties of contract
obligations that could lead to a financial loss to the Group.
Credit risk is managed through the maintenance of
procedures (such procedures include the utilisation of
systems for the approval, granting and renewal of credit
limits, regular monitoring of exposures against such limits
and monitoring of the financial stability of significant
customers and counterparties), ensuring to the extent
possible, that customers and counterparties to transactions
are of sound credit worthiness. Such monitoring is used in
assessing receivables for impairment. Depending on the
division within the Group, credit terms are generally 30 to
60 days from the invoice date. The Group considers various
debt recovery methodologies.
Where the Group is unable to ascertain a satisfactory credit
risk profile in relation to a customer or counterparty, the
risk may be further managed through title retention clauses
over goods or obtaining security by way of personal or
commercial guarantees over assets which may be claimed
against in the event of any default. In addition MACA is a
secured debt holder of Carabella Resources Pty Ltd.
Financial Assets
Financial Assets at Amortised Cost:
— Cash and Cash Equivalents
— Trade and Other Receivables
— Loans to Other Companies
— WIP Liabilities
Financial Assets at Fair Value Through Profit or Loss:
— Listed Investments
Total Financial Assets
Financial Liabilities
Financial Liabilities at Amortised Cost:
— Trade and Other Payables (incl. Deferred Consideration Payable)
— Interest Bearing Liabilities
Total Financial Liabilities
30 June
2021
$’000
30 June
2020
$’000
Section
5.1.1
4.1
4.1
4.2
4.1
4.6
5.2.1
122,346
294,120
26,841
(4,862)
114,650
154,329
26,841
(3,017)
30
438,475
69
292,872
285,122
302,571
587,693
111,916
188,072
299,988
97
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.3 FINANCIAL RISK MANAGEMENT (CONTINUED)
Risk is also minimised through investing surplus funds in
financial institutions that maintain a high credit rating, or
in entities that the Board has otherwise cleared as being
financially sound.
The maximum exposure to credit risk by class of recognised
financial assets at balance date, excluding the value of any
collateral or other security held, is equivalent to the carrying
value and classification of those financial assets (net of
any provisions) as presented in the statement of financial
position. Credit risk also arises through the provision of
financial guarantees, as approved at Board level, given to
parties securing the liabilities of certain subsidiaries (refer
Section 6.6 Parent Entity Disclosures for details).
Trade Receivables and Contract Assets
The Group applies the simplified approach to provide for
the Expect Credit Loss (“ECL”) for all trade receivables.
The simplified approach required the loss allowance to be
measured at an amount equal to the lifetime ECL.
The Group uses a provision matrix to measure the lifetime
ECL allowance for trade receivables. In measuring the ECL,
trade receivables are grouped based on shared credit risk
characteristics and days past due.
Internal
Rating
Grades
Performing
Under-
Performing
Non-
Performing
Defi nition
The counterparty has
a low risk of default
and does not have
any past due amounts
There has been a
significant increase in
credit risk since initial
recognition
There is evidence
indicating that the
asset is credit-
impaired
Basis for
Recognition
and
Measurement
of ECL
12-mth ECL
Lifetime ECL
(not credit-
impaired)
Lifetime
ECL (credit-
impaired)
S
T
N
E
T
N
O
C
S
U
T
U
O
B
A
P
I
H
S
R
E
D
A
E
L
W
E
I
V
E
R
L
A
N
O
I
T
A
R
E
P
O
T
R
O
P
E
R
’
S
R
O
T
C
E
R
I
D
T
R
O
P
E
R
L
A
I
C
N
A
N
I
F
In calculating the ECL rates, the Group considers historical
loss rates for each category of customers and adjust for
forward looking macroeconomic data.
The Group considers the trade receivables as in default
when the counterparty fail to make contractual payments
for a prolonged period of time when they fall due, and the
Group may also consider financial or economic conditions
that are expected to cause a significant change to the
debtors’ ability to meet their obligations. Trade receivables
are written off when there is no reasonable expectation of
recovering the contractual cash flow. When trade receivables
have been written off, the Group continues to engage in
enforcement activity to attempt to recover the debts. Where
recoveries are made, these are recognised in profit or loss.
Receivables for which an impairment/expected credit
loss provision was recognised are written off against
the provision when there is no expectation of recovering
additional cash.
The creation and release of the provision for impaired and
expected credit loss receivables has been shown separately
in the consolidated statement of profit or loss.
The Group’s credit risk exposure in relation to Trade
Receivables and Contract Assets at 30 June 2021 is set out in
Section 4.1.
Management has assessed all trade receivables and
identified and impaired $4.2m through profit and loss, a bad
debt of $3.2m and raised a provision for doubtful debts of
$0.98m. Management’s assessment concluded that all other
trade receivables were not subject to material credit loss.
There has been no change in the estimation techniques or
significant assumptions made during the financial period.
Provision for
Impairment and
Expected Credit Losses
of Trade Receivables
Opening Balance
Provision (reversed) /
recognised during
the year
Receivables written off
during the year
as uncollectable
Section
30 June
2021
$’000
30 June
2020
$’000
48,415
4,202
-
48,415
(51,636)
-
Closing Balance
4.1
981
48,415
MACA LIMITED ANNUAL REPORT 2021
98
FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.3 FINANCIAL RISK MANAGEMENT (CONTINUED)
Other Receivables
Liquidity Risk
The Group applies the general approach to provide for the
ECL for other receivables. Under the general approach,
the loss allowance is measured at an amount equal to the
12-month ECL at initial recognition.
Liquidity risk arises from the possibility that the Group
might encounter difficulty in settling its debts or otherwise
meeting its obligations related to financial liabilities. The
Group manages this risk through the following mechanisms:
At each reporting date, the Group assesses whether
the credit risk of a financial instrument has increased
significantly since initial recognition. When credit risk
has increased significantly since initial recognition, loss
allowance is measured at an amount equal to lifetime ECL.
The Group has approximately 14% (2020: 22%) of post-
impairment credit risk with a single counterparty or group
of counterparties. Failure or default of a major counterparty
would have a material impact on earnings. The classes of
assets described as Trade and Other Receivables and Loans
to Other Companies are considered to be main source of
credit risk related to the Group.
The loan to Carabella Resources Pty Ltd (“Carabella”) under
the working capital facility of $26.84m remains outstanding,
it is repayable from free cashflows from the project. Both
loan and receivables are secured over the project assets and
subject to its parent company guarantee, which is expected
to be sufficient to cover the loan and remaining receivables
following the impairment of $48.4m recognised in FY20.
Trade and other receivables that remain within initial trade
terms are considered to be of acceptable quality and fully
recoverable.
Credit risk related to balances held with banks and other
financial institutions are only invested with counterparties
with a Standard & Poor’s rating of at least AA-.
- preparing forward looking cashflow analysis in relation to
its operational, investing and financing activities;
- monitoring undrawn credit facilities;
- obtaining funding from a variety of sources;
- maintaining a reputable credit profile;
- managing credit risk related to financial assets;
- only investing surplus cash with major financial
institutions; and
- comparing the maturity profile of financial liabilities with
the realisation profile of financial assets.
The Group’s policy is to ensure that all lease agreements
entered into, are over a period that will ensure that adequate
cash flows will be available to meet repayments.
The tables below reflect an undiscounted contractual
maturity analysis for financial liabilities. Financial guarantee
liabilities are treated as payable on demand since the Group
has no control over the timing of any potential settlement of
the liabilities.
Cash flows realised from financial assets reflect
management’s expectation as to the timing of realisation.
Actual timing may therefore differ from that disclosed. The
timing of cash flows presented in the table to settle financial
liabilities reflects the earliest contractual settlement dates
and does not reflect management’s expectations that
banking facilities will be rolled forward.
99
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.3 FINANCIAL RISK MANAGEMENT (CONTINUED)
Liquidity Risk (Continued)
Financial Liability and
Financial Asset Maturity Analysis
Within 1 Year
2020
2021
1 to 5 Years
2021
2020
Over 5 Years
2021
2020
Section
‘000
‘000
‘000
‘000
‘000
‘000
Financial Liabilities Due for Payment
Trade and Other Payables
Interest Bearing Liabilities
Total Contractual Outflows
Total Expected Outflows
4.6
5.2.1
285,122 111,916
-
-
97,331
55,127 205,240 132,945
382,453 167,043 205,240 132,945
382,453 167,043 205,240 132,945
Financial Assets - Cash Flows Realisable
Cash and Cash Equivalents
5.1.1
122,346 114,650
-
Trade and Other Receivables
Investments and Loan Receivables
WIP Liabilities
Total Anticipated Inflows
Net (Outflow)/Inflow on Financial
Instruments
4.1
4.1
4.2
-
-
284,651 154,329
9,469
30
69
26,841
26,841
(4,862)
(3,017)
-
-
402,165 266,031
36,310
26,841
19,712
98,988 (168,930) (106,104)
-
-
-
-
-
-
-
-
-
-
Total
2021
‘000
2020
‘000
285,122
111,916
302,571
188,072
587,693
299,988
587,693
299,988
122,346
114,650
294,120
154,329
26,871
(4,862)
26,910
(3,017)
438,475
292,872
(149,218)
(7,116)
-
-
-
-
-
-
-
-
-
-
All financial assets have been pledged as security under Commonwealth Bank of Australia facility agreement.
Market Risk
Interest Rate Risk
The Group’s exposure to interest rate risk, which is the risk that a financial instrument’s value will fluctuate as a result of
changes in market interest rates and the effective weighted average interest rates on those financial assets and financial
liabilities, is as follows:
Floating
Interest Rate
Fixed Interest Rate
Within 1 Year
1 to 5 Years
Non-interest
Bearing
Total
2021
‘000
2020
‘000
2021
‘000
2020
‘000
2021
‘000
2020
‘000
2021
‘000
2020
‘000
2021
‘000
2020
‘000
Financial Assets
Cash
122,346 114,650
Trade and Other Receivables
-
-
Loans to Other Companies
WIP Liabilities
Total Financial Assets
-
-
-
-
122,346 114,650
-
-
-
-
-
-
11,190
-
-
-
-
26,841
-
11,190
26,841
-
-
- 122,346 114,650
- 294,120 143,139 294,120 154,329
26,841
(3,017)
(3,017)
26,841 289,258 140,122 438,445 292,803
- 26,841
(4,862)
-
(4,862)
26,841
-
Weighted
Average
Eff ective
Interest Rate
2021
2020
%
%
0.10
N/A
9.00
N/A
-
0.50
9.00
N/A
Financial Liabilities
Interest Bearing Liabilities
117,000
Trade and Other Payables
-
Total Financial Liabilities
117,000
-
-
-
71,331
55,127 114,240 132,945
-
- 302,571 188,072
3.15
-
-
-
- 285,122 111,916 285,122 111,916
N/A
3.80
N/A
71,331
55,127 114,240 132,945 285,122 111,916 587,693 299,988
MACA LIMITED ANNUAL REPORT 2021
100
S
T
N
E
T
N
O
C
S
U
T
U
O
B
A
P
I
H
S
R
E
D
A
E
L
W
E
I
V
E
R
L
A
N
O
I
T
A
R
E
P
O
T
R
O
P
E
R
’
S
R
O
T
C
E
R
I
D
T
R
O
P
E
R
L
A
I
C
N
A
N
I
F
FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.3 FINANCIAL RISK MANAGEMENT (CONTINUED)
Price Risk
The Group is also exposed to securities price risk on
investments held for trading or for medium to longer terms.
The risk associated with these investments has been
assessed as reasonably not having a significant impact on
the Group.
Foreign Exchange Risk
The Group is exposed to fluctuations in foreign currencies.
The currency exposure relates to Brazilian Real and US
Dollar being cash in bank, trade receivables subject to
repayment and intercompany loan. Both Brazilian Real
and US Dollar are unhedged. The original investment into
the Brazilian subsidiary is exposed to fluctuations in the
Brazilian Real. On 21 January 2020, the Group announced
its decision to cease the operations in Brazil, which resulted
Year ended 30 Jun 2021
+/- 2% in Interest Rates
+/- 10% in the Value of Listed Investments
+/- 10% in AUD/BRL Exchange Rate
+/- 10% in AUD/USD Exchange Rate
Year ended 30 Jun 2020
+/- 2% in Interest Rates
+/- 10% in the Value of Listed Investments
+/- 10% in AUD/BRL Exchange Rate
+/- 10% in AUD/USD Exchange Rate
in the realisation of the foreign currency translation reserve
to income statement (see Note 5.6(b)). The operations in
Cambodia are denominated in USD and commenced during
the FY21.
Summarised Sensitivity Analysis
The following illustrates sensitivities to the Group’s
exposures to changes in interest rates, foreign exchange
and equity prices. The table indicates the impact on how
profit and equity values reported at the end of the reporting
period would have been affected by changes in the relevant
risk variable that management considers to be reasonably
possible.
These sensitivities assume that the movement in a particular
variable is independent of the other variables.
Profi t
$’000
Equity
$’000
+/-3,068 +/-3,068
+/- 3
+/- 3
+/- 367
+/- 392
+/- 1,787 +/- 1,787
+/- 708
+/- 708
+/- 7
+/- 7
+/- 300 +/- 1,140
+/- 2,159 +/- 2,159
101
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.4 FINANCIAL INSTRUMENTS
Initial recognition and measurement
Financial assets and financial liabilities are recognised when
the Group becomes a party to the contractual provisions to
the instrument. For financial assets, this is equivalent to the
date that the Group commits itself to either the purchase or
sale of the asset (i.e. trade date accounting is adopted).
Financial instruments (except for trade receivables) are
initially measured at fair value plus transaction costs, except
where the instrument is classified ‘at fair value through
profit or loss’, in which case transaction costs are expensed
to profit or loss immediately. Where available, quoted prices
in an active market are used to determine fair value.
Trade receivables are initially measured at the transaction
price if the trade receivables do not contain a significant
financing component or if the practical expedient was
applied as specified in AASB 15.63.
Classifi cation and subsequent measurement
Financial Liabilities
Financial instruments are subsequently measured at:
- amortised cost; or
- fair value through profit or loss.
A financial liability is measured at fair value through profit
and loss if the financial liability is:
- a contingent consideration of an acquirer in a business
combination to which AASB 3: Business Combinations
applies;
- held for trading; or
- initially designated as at fair value through profit or loss.
All other financial liabilities are subsequently measured at
amortised cost using the effective interest method.
The effective interest method is a method of calculating
the amortised cost of a debt instrument and of allocating
interest expense in profit or loss over the relevant period.
The effective interest rate is the internal rate of return of the
financial asset or liability. That is, it is the rate that exactly
discounts the estimated future cash flows through the
expected life of the instrument to the net carrying amount at
initial recognition.
A financial liability is held for trading if:
- it is incurred for the purpose of repurchasing or repaying
in the near term;
- part of a portfolio where there is an actual pattern of
short-term profit taking; or
- a derivative financial instrument (except for a derivative
that is in a financial guarantee contract or a derivative
that is in a effective hedging relationships).
Any gains or losses arising on changes in fair value are
recognised in profit or loss to the extent that they are not
part of a designated hedging relationship are recognised in
profit or loss.
The change in fair value of the financial liability attributable
to changes in the issuer’s credit risk is taken to other
comprehensive income and are not subsequently
reclassified to profit or loss. Instead, they are transferred
to retained earnings upon derecognition of the financial
liability. If taking the change in credit risk in other
comprehensive income enlarges or creates an accounting
mismatch, then these gains or losses should be taken to
profit or loss rather than other comprehensive income.
A financial liability cannot be reclassified.
Financial Assets
Financial Assets are subsequently measured at:
- amortised cost;
- fair value through other comprehensive income,: or
- fair value through profit or loss.
Measurement is on the basis of two primary criteria:
- the contractual cash flow characteristics of the financial
assets; and
- the business model for managing the financial assets.
A financial asset that meets the following conditions is
subsequently measured at amortised cost:
- the financial asset is managed solely to collect
contractual cash flows; and
- the contractual terms within the financial asset give rise
to cash flows that are solely payments of principal and
interest on the principal amount outstanding on specified
dates.
A financial asset that meets the following conditions
is subsequently measured at fair value through other
comprehensive income:
- the contractual terms within the financial asset give rise
to cash flows that are solely payments of principal and
interest on the principal amount outstanding on specified
dates;
- the business model for managing the financial assets
comprises both contractual cash flows collection and the
selling of the financial asset.
By default, all other financial assets that do not meet the
measurement conditions of amortised cost and fair value
through other comprehensive income are subsequently
measured at fair value through profit or loss.
MACA LIMITED ANNUAL REPORT 2021
102
S
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N
E
T
N
O
C
S
U
T
U
O
B
A
P
I
H
S
R
E
D
A
E
L
W
E
I
V
E
R
L
A
N
O
I
T
A
R
E
P
O
T
R
O
P
E
R
’
S
R
O
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I
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T
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F
FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.4 FINANCIAL INSTRUMENTS (CONTINUED)
Financial Assets (Continued)
De-recognition
The Group initially designates a financial instrument as
measured at fair value through profit or loss if:
- it eliminates or significantly reduces a measurement
or recognition inconsistency (often referred to as
“accounting mismatch”) that would otherwise arise from
measuring assets or liabilities or recognising the gains
and losses on them on different bases;
- it is in accordance with the documented risk management
or investment strategy, and information about the
groupings was documented appropriately, so that the
performance of the financial liability that was part of a
group of financial liabilities or financial assets can be
managed and evaluated consistently on a fair value basis;
- it is a hybrid contract that contains an embedded
derivative that significantly modifies the cash flows
otherwise required by the contract.
Derecognition refers to the removal of a previously
recognised financial asset or financial liability from the
statement of financial position.
Derecognition of fi nancial liabilities
A liability is derecognised when it is extinguished (ie when
the obligation in the contract is discharged, cancelled or
expires). An exchange of an existing financial liability for a
new one with substantially modified terms, or a substantial
modification to the terms of a financial liability is treated as
an extinguishment of the existing liability and recognition of
a new financial liability.
The difference between the carrying amount of the financial
liability derecognised and the consideration paid and
payable, including any non-cash assets transferred or
liabilities assumed, is recognised in profit or loss.
Derecognition of fi nancial assets
The initial designation of the financial instruments to
measure at fair value through profit or loss is a one-time
option on initial classification and is irrevocable until the
financial asset is derecognised.
A financial asset is derecognised when the holder’s
contractual rights to its cash flows expires, or the asset is
transferred in such a way that all the risks and rewards of
ownership are substantially transferred.
Financial assets are classified at ‘fair value through profit or
loss’ when they are either held for trading for the purpose
of short-term profit taking, derivatives not held for hedging
purposes, or when they are designated as such to avoid an
accounting mismatch or to enable performance evaluation
where a group of financial assets is managed by key
management personnel on a fair value basis in accordance
with a documented risk management or investment strategy.
Such assets are subsequently measured at fair value with
changes in carrying value being included in profit or loss.
Equity instruments
At initial recognition, as long as the equity instrument is
not held for trading and not a contingent consideration
recognised by an acquirer in a business combination to
which AASB 3:Business Combinations applies, the Group
made an irrevocable election to measure any subsequent
changes in fair value of the equity instruments in other
comprehensive income, while the dividend revenue received
on underlying equity instruments investment will still be
recognised in profit or loss.
Regular way purchases and sales of financial assets
are recognised and derecognised at settlement date in
accordance with the Group’s accounting policy.
All of the following criteria need to be satisfied for
derecognition of financial asset:
- the right to receive cash flows from the asset has expired
or been transferred;
- all risk and rewards of ownership of the asset have been
substantially transferred; and
- the Group no longer controls the asset (i.e. the Group has
no practical ability to make a unilateral decision to sell
the asset to a third party).
On derecognition of a financial asset measured at amortised
cost, the difference between the asset’s carrying amount
and the sum of the consideration received and receivable is
recognised in profit or loss.
On derecognition of a debt instrument classified as at fair
value through other comprehensive income, the cumulative
gain or loss previously accumulated in the investment
revaluation reserve is reclassified to profit or loss.
On derecognition of an investment in equity which was
elected to be classified under fair value through other
comprehensive income, the cumulative gain or loss
previously accumulated in the investment revaluation
reserve is not reclassified to profit or loss, but is transferred
to retained earnings.
103
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.4 FINANCIAL INSTRUMENTS (CONTINUED)
Impairment
Simplifi ed approach
The Group recognises a loss allowance for expected credit
losses on:
- financial assets that are measured at amortised cost or
fair value through other comprehensive income;
The simplified approach does not require tracking of
changes in credit risk at every reporting period, but instead
requires the recognition of lifetime expected credit loss at all
times. This approach is applicable to:
- trade receivables or contract assets that result from
transactions within the scope of AASB 15: Revenue from
Contracts with Customers and which do not contain a
significant financing component; and
- lease receivables.
In measuring the expected credit loss, a provision matrix
for trade receivables was used taking into consideration
various data to get to an expected credit loss (ie diversity
of customer base, appropriate groupings of historical loss
experience, etc).
Recognition of expected credit losses in fi nancial
statements
At each reporting date, the Group recognises the movement
in the loss allowance as an impairment gain or loss in the
statement of profit or loss and other comprehensive income.
The carrying amount of financial assets measured at
amortised cost includes the loss allowance relating to that
asset.
Assets measured at fair value through other comprehensive
income are recognised at fair value, with changes in fair
value recognised in other comprehensive income. Amounts
in relation to change in credit risk are transferred from other
comprehensive income to profit or loss at every reporting
period.
- lease receivables;
- contract assets (eg amounts due from customers under
construction contracts);
- loan commitments that are not measured at fair value
through profit or loss; and
- financial guarantee contracts that are not measured at
fair value through profit or loss.
Loss allowance is not recognised for:
- financial assets measured at fair value through profit or
loss; or
- equity instruments measured at fair value through other
comprehensive income.
Expected credit losses are the probability-weighted
estimate of credit losses over the expected life of a financial
instrument. A credit loss is the difference between all
contractual cash flows that are due and all cash flows
expected to be received, all discounted at the original
effective interest rate of the financial instrument.
The Group uses the following approaches to impairment, as
applicable under AASB 9: Financial Instruments:
- the general approach; and
- the simplified approach
General approach
Under the general approach, at each reporting period, the
Group assesses whether the financial instruments are credit-
impaired, and if:
- the credit risk of the financial instrument has increased
significantly since initial recognition, the Group measures
the loss allowance of the financial instruments at an
amount equal to the lifetime expected credit losses; or
- there is no significant increase in credit risk since initial
recognition, the Group measures the loss allowance for
that financial instrument at an amount equal to 12-month
expected credit losses.
MACA LIMITED ANNUAL REPORT 2021
104
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N
E
T
N
O
C
S
U
T
U
O
B
A
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I
H
S
R
E
D
A
E
L
W
E
I
V
E
R
L
A
N
O
I
T
A
R
E
P
O
T
R
O
P
E
R
’
S
R
O
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FINANCIAL REPORT
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.5 EQUITY
30 June
2021
No.
30 June
2020
No.
30 June
2021
$’000
30 June
2020
$’000
Issued Capital - Ordinary Shares
At the Beginning of the Reporting Period
268,007,708 268,007,708
269,806
269,806
Shares Issued During the Year (net of costs)
- 23 December 2020 @ $1.02 per share
- 15 January 2021 @ $1.02 per share
At the End of the Reporting Period
58,530,982
15,172,156
-
-
57,544
14,917
-
-
341,710,846 268,007,708
342,267
269,806
The Company has no authorised share capital. Ordinary shares participate in dividends and the proceeds on winding up of
the parent entity in proportion to the number of shares held. At the shareholders’ meetings each ordinary share is entitled to
one vote when a poll is called, otherwise each shareholder has one vote on a show of hands.
Performance Rights
For information relating to performance rights, including details of performance rights issued, exercised and lapsed during
the financial year, refer to Section 5.8.
Capital Management
Management controls the capital of the Group in order to maintain a prudent debt to equity ratio, provide the shareholders
with adequate returns and ensure that the Group can fund its operations and continue as a going concern.
The Group’s debt and capital includes ordinary share capital and financial liabilities, supported by financial assets.
There are no externally imposed capital requirements. Management effectively manages the Group’s capital by assessing
the Group’s financial risks and adjusting its capital structure in response to changes in these risks and in the market. These
responses include the management of debt levels, distributions to shareholders and share issues.
Section
5.2.1
5.1.1
30 June
2021
$’000
302,571
(122,346)
180,225
387,608
567,833
46%
30 June
2020
$’000
188,072
(114,650)
73,422
309,660
383,082
24%
Total Borrowings
Less Cash and Cash Equivalents
Net Debt/(Cash)
Total Equity
Total Capital
Net Debt/Equity Ratio
105
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.6 RESERVES
Accounting Policies
Equity Settled Employee Benefi ts Reserve
Foreign Currency Translation Reserve
The equity-settled employee benefits reserve relates
to performance rights granted by the Company to its
Executives and employees under its Employee Long-Term
Incentive Plan. Rights granted during the year were made
via an Employee Share Trust and as a result there was no
movement in the Equity Settled Employee Benefits Reserve.
Exchange differences arising on translation of foreign
controlled operations are taken to the exchange fluctuation
reserve. Gains or losses accumulated in equity are
recognised in the income statement when a foreign
operation is disposed or discontinued.
General Reserves
The General reserves represent funds associated with the
acquisition of non-controlling interests of controlled entities
from previous years.
Foreign Operations
The financial transactions of foreign operations whose
functional currency is different from the presentation
currency are translated at the exchange rates prevailing
at the date of the transaction. At the end of the reporting
period, assets and liabilities are re-translated at the rates
prevailing at that date. Income and expenses are re-
translated at average exchange rates for the period.
Exchange differences arising on translation of foreign
operations are transferred directly to the foreign currency
translation reserve in the Consolidated Statement of
Financial Position. These differences are recognised in profit
and loss in the period in which the operation is disposed or
discontinued.
Reserves
Equity-Settled Employee Benefits Reserve
Foreign Currency Translation Reserve
General Reserves
Total Reserves
(a) General Reserves
Balance at the Beginning of the Year
Transactions with Members
Balance at the End of the Year
(b) Foreign Currency Translation Reserve
Balance at the Beginning of the Year
Exchange Differences Arising on Translating the Foreign Operations
Transfer of Forex Reserve on Discontinued Operations
Balance at the End of the Year
30 June
2021
$’000
30 June
2020
$’000
Section
590
-
(5,888)
(5,298)
(5,888)
-
(5,888)
-
-
-
-
590
-
(5,888)
(5,298)
(5,888)
-
(5,888)
(8,495)
(2,072)
10,567
-
MACA LIMITED ANNUAL REPORT 2021
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SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.7 DIVIDENDS
In respect of FY21, the Directors declared the payment of a Final Dividend of 2.5 cents per share fully franked to the holders
of fully paid ordinary shares on the Company’s register at 3rd September 2021 with payment date of 17th September 2021.
The amount of the Final Dividend is $8.5 million. No provision has been made for the Final Dividend in the Financial
Statements as the final dividend was not declared or determined by the Directors on or before the end of the financial year.
30 June 2021
30 June 2020
Cents Per
Share
$’000
Cents Per
Share
$’000
2.5
2.5
5.0
8,543
8,543
17,086
57,709
2.5
2.5
5.0
6,700
6,700
13,400
51,991
Distributions Paid/Payable
Interim Dividend in respect of FY21 / FY20
Final Dividend in respect of FY21 / FY20
Total
Balance of franking account at year end
5.8 SHARE-BASED COMPENSATION
Options
There were no options issued for the year ended 30 June 2021. The weighted average fair value of options granted during the
previous year was Nil.
Performance Rights
The Company issues performance rights to Senior executives in accordance with the terms of the Long-Term Incentive Plan
and the Performance Rights Plan as approved by Shareholders. When vested, each performance right is converted into one
ordinary share for no consideration. Performance rights granted carry no dividend or voting rights.
During the 2021 financial year 2,843,084 (2020: 1,906,909) performance rights were granted under the Group’s Performance
Rights Plan and 1,529,493 (2020: 1,452,208) performance rights were forfeited. Subject to the achievement of designated
performance hurdles, these performance rights will vest in June 2023. As at 30 June 2021 there were 4,004,169 (2020:
2,690,578) performance rights outstanding.
The following performance rights arrangement was in existence at 30 June 2021:
Unlisted Performance Rights
Unlisted Performance Rights
Outstanding at the Beginning of the Year
Granted
Vested
Cancelled or Expired
Outstanding at the End of the Year
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MACA LIMITED ANNUAL REPORT 2021
Number
Expiry Date
1,161,085
2,843,084
30-Jun-22
30-Jun-23
30 June 2021
Number
30 June 2020
Number
2,690,578
2,843,084
-
2,235,877
1,906,909
-
(1,529,493)
(1,452,208)
4,004,169
2,690,578
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
5.8 SHARE-BASED COMPENSATION (CONTINUED)
Performance Rights (Continued)
An independent valuation was completed on performance rights granted during the year. Market based vesting conditions
were valued using a hybrid share option pricing model that simulates the share price of the Company as at the test date
using a Monte-Carlo simulation model. For non-market based vesting conditions no discount was made to the underlying
valuation model.
The weighted average fair value of the performance rights granted during the year ended 30 June 2021 was $0.45 per
right. Payments were made to the MACA ERT Trust for delivery of shares under the Performance Rights Plan. Inputs used to
determine the fair value of performance rights granted during the year ended 30 June 2021 were:
- Share price $0.873 being the 30 day VWAP of the Company on the last trading day prior to 30 June 2020
- Exercise price: Nil
- Volatility: 34.03%
- Option life: 3 years
- Dividend yield: 5.2%
- Risk Free Rate 0.26%
SECTION 6 OTHER
6.1 BUSINESS COMBINATIONS
Accounting Policies
Business combinations occur where an acquirer obtains control over one or more businesses, and is to be completed within
a 12 month period.
A business combination is accounted for by applying the acquisition method, unless it is a combination involving entities or
businesses under common control. The business combination will be accounted for from the date that control is obtained,
whereby the fair value of the identifiable assets acquired and liabilities (including contingent liabilities) assumed is
recognised (subject to certain limited exemptions).
When measuring the consideration transferred in the business combination, any asset or liability resulting from a contingent
consideration arrangement is also included. Subsequent to initial recognition, contingent consideration classified as equity
is not remeasured and its subsequent settlement is accounted for within equity. Contingent consideration classified as an
asset or liability is remeasured in each reporting period to fair value, recognising any change to fair value in profit or loss,
unless the change in value can be identified as existing at acquisition date.
All transaction costs incurred in relation to business combinations, other than those associated with the issue of a financial
instrument, are recognised as expenses in profit or loss when incurred.
The acquisition of a business may result in the recognition of goodwill or a gain from a bargain purchase. The gain from a
bargain purchase is recognised in profit or loss immediately and is not deductible for tax purpose.
Refer 4.5 Intangible Assets for treatment and calculation of customer contracts.
Acquisition of Mining West
On 1st February 2021, MACA completed the acquisition of the Mining West business from Downer EDI Ltd, which comprises
four contracts at the long-life assets of Karara (Ansteel), Eliwana (FMG), Cape Preston (Citic Pacific) and Gruyere (Gold
Fields).
The acquisition was funded by $130 million debt facility from Commonwealth Bank of Australia (“CBA”) and $72.4 million
equity capital raising (net of capital raising costs).
MACA LIMITED ANNUAL REPORT 2021
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SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
6.1 BUSINESS COMBINATIONS (CONTINUED)
The major classes of assets and liabilities at the date of acquisition are as follows:
Section
Fair Value
$‘000
Purchase Consideration - Cash
- Initial Consideration (Paid)
- Deferred Consideration (Paid)
Total Cash Paid as at 30 June 2021
- Deferred Consideration (Payable over the remaining 7 months)
4.6
Total Consideration - Cash
Less:
- Inventory
- Debtors subject to Payment Arrangements (Current and Non-Current)
- Plant & Equipment
- Deferred Tax Asset
- Employee Entitlements
- Intangible - Customer Contracts
Identifiable Assets Acquired and Liabilities Assumed
Goodwill / (Gain) on Business Combination
4.4
3.6.3(c)
4.7
4.5
109,000
27,500
136,500
38,500
175,000
40,004
11,315
135,375
5,010
(16,704)
4,535
179,535
(4,535)
The resulting gain on business acquisition can be attributed to the vendor’s urban services strategy which culminated in the
exit of their mining and other non-core businesses during the year ended 30 June 2021.
Revenue and Profit of Mining West included in the consolidated revenue and NPAT of the Group since the acquisition date on
1st February 2021 amounted to $201.3m and $5.7m respectively (excluding acquisition-related costs). Acquisition-related
costs totalled $12.4m including stamp duty, advisory, legal, accounting and other professional fees.
Had the results of Mining West been consolidated from 1st July 2020, revenue and NPAT of the consolidated group would
have been $1,373m and $33.4m respectively for the year ended 30 June 2021.
109
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
6.2 CONTROLLED ENTITIES
Details of the Company’s subsidiaries at the end of the reporting period are as follows:
Parent Entity:
MACA Limited
Subsidiaries:
MACA Mining Pty Ltd
MACA Plant Pty Ltd
MACA Crushing Pty Ltd
MACA Civil Pty Ltd
Riverlea Corporation Pty Ltd
MACA Mineracao e Construcao Civil Ltda
Alliance Contracting Pty Ltd
MACA Infrastructure Pty Ltd
Marniyarra Mining and Civils Pty Ltd
Interquip Pty Ltd
Interquip Construction Pty Ltd*
OPMS Cambodia Co Ltd
Percentage Owned (%)
Country of
Incorporation
30 June
2021
30 June
2020
Australia
Australia
Australia
Australia
Australia
Australia
Brazil
Australia
Australia
Australia
Australia
Australia
100%
100%
100%
100%
100%
100%
100%
100%
50%
60%
60%
100%
100%
100%
100%
100%
100%
100%
100%
50%
60%
60%
Cambodia
100%
100%
*Interquip Construction Pty Ltd wholly owned by Interquip Pty Ltd
6.3 JOINT ARRANGEMENTS
Joint arrangements represent the contractual sharing of control between parties in a business venture where unanimous
decisions about relevant activities are required.
Joint operations represent arrangements whereby joint operators maintain direct interests in each asset and exposure to
each liability of the arrangement. The Group’s interests in the assets, liabilities, revenue and expenses of joint operations are
included in the respective line items of the consolidated financial statements.
Information about Joint Operations
MACA Civil Pty Ltd (“Company”) holds a 9.4% interest in South West Gateway Alliance (“Joint Operation”), a joint
arrangement structured as a strategic partnership between the Company, Acciona Construction Australia Pty Ltd, Aurecon
Australasia Pty Ltd and NRW Contracting Pty Ltd. The principal place of business of Joint Operation is Bunbury, Western
Australia and the primary purpose of the joint arrangement is to facilitate the road design and construction services on
behalf of the joint operators. The arrangement also enables the parties to source materials for their respective manufacturing
processes that meet their individual specifications. Under the Joint Operation agreement, the Company has a 9.4% direct
interest in all of the assets used, the revenue generated and the expenses incurred by the joint arrangement. The Company
is also liable for 9.4% of any liabilities incurred by the joint arrangement. In addition, pursuant to the joint Operation
agreement, the Company has 9.4% of the voting rights in relation to the Joint Operation.
MACA Civil Pty Ltd (“Company”) holds a 50% interest in Bocol MACA Joint Venture (“Joint Operation”), a joint arrangement
structured as a strategic partnership between the Company and Bocol Constructions Pty Ltd. The principal place of business
of the Joint Operation is Perth, Western Australia and the primary purpose of the joint arrangement is to facilitate design and
construction of public bridge and road structures on behalf of the joint operators.
MACA LIMITED ANNUAL REPORT 2021
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SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
6.3 JOINT ARRANGEMENTS (CONTINUED)
The arrangement also enables the parties to source materials for their respective manufacturing processes that meet their
individual specifications. Under the Joint Operation agreement, the Company has a 50% direct interest in all of the assets
used, the revenue generated and the expenses incurred by the joint arrangement. The Company is also liable for 50% of any
liabilities incurred by the joint arrangement. In addition, pursuant to the Joint Operation agreement, the Company has 50%
of the voting rights in relation to the Joint Operation.
South West Gateway Alliance and Bocol MACA Joint Venture are contractually established entities and are classified as joint
operations. Accordingly, the Company’s interests in the assets, liabilities, revenues and expenses attributable to the joint
arrangements have been included in the appropriate line items in the consolidated financial statements.
The Group’s share of the assets employed the Joint Operations along with its share of liabilities that are included in the
consolidated financial statements are as follows:
Current Assets
Cash at Bank
Trade and Other Receivables
Work In Progress
Total Current Assets
Current Liabilities
Trade and Other Payables
Net interest in Joint Operations
6.4 RELATED PARTY TRANSACTIONS
30 June 2021
$’000
South West
Gateway Alliance Bocol MACA
Total
2,205
4,913
-
7,118
6,666
452
-
447
282
729
99
630
2,205
5,360
282
7,847
6,765
1,082
Transactions between related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated. Transactions with related parties:
Key Management Personnel
Any person(s) having authority and responsibility for planning, directing and controlling the activities of the entity, directly or
indirectly, including any director (whether executive or otherwise) of that entity, are considered key management personnel.
Information regarding individual directors or executives remuneration is provided in the Remuneration Report included in
the Director’s Report.
The total of remuneration paid to KMP’s of the Group during the year was as follows:
Short-Term Employee Benefits
Post-Employment Benefits
Other Long-Term Benefits
Long-Term Incentive Payments
Total Remuneration
30 June
2021
$’000
30 June
2020
$’000
2,413
99
-
335
2,847
2,711
162
-
409
3,282
A restructure of the corporate leadership team in FY21 has reduced the members of management included as KMP.
Accordingly, 30 June 2020 balances have been amended to reflect the restructure.
111
MACA LIMITED ANNUAL REPORT 2021
SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
6.4 RELATED PARTY TRANSACTIONS (CONTINUED)
Controlled Entities
Other Related Parties
Interests in controlled entities are set out Section 6.2.
During the year, funds have been advanced between
entities within the Group for the purposes of working
capital requirements.
Other related parties include entities over which key
management personnel exercise significant influence.
Transactions between related parties are on normal
commercial terms and conditions no more favourable than
those available to other parties unless otherwise stated.
Key Management Person and/or Related Party
Transaction
Partnership of which current director Mr G.Baker is a
25% partner.
Rent on Division St Business
premises.
Kirk Mining Consultants - a company controlled by current
director Mr L.Kirk.
Mining consulting fees
Hensman Properties Pty Ltd - a company controlled by
current director Mr R.Ryan.
Consulting fees
30 June
2021
$’000
30 June
2020
$’000
1,578
1,548
-
-
41
19
Gateway Equipment Parts & Services Pty Ltd * - a company
of which current director Mr G.Baker’s Family Trust is a
20% beneficial shareholder.
Gateway Equipment Parts & Services Pty Ltd - a company of
which current director Mr G.Baker’s Family Trust is a 20%
beneficial shareholder.
Hire of equipment and purchase
of equipment, parts and services.
5,852
4,974
Sale of equipment (Revenue)
-
430
Amounts payable at year end arising from the above transactions
Gateway Equipment Parts & Services Pty Ltd - a company of
which current director Mr G.Baker’s Family Trust is a 20%
beneficial shareholder.
920
150
* Increase in value traded is attributable to inclusion of services provided to Mining West since acquisition, and nothing in
the comparative period.
6.5 CONTINGENT LIABILITIES
Performance Guarantees
MLD has indemnified its bankers and insurance bond providers in respect of bank guarantees, insurance bonds and letters
of credit to various customers and suppliers for satisfactory contract performance and warranty security, in the following
amounts:
30 Jun 2021: $29.1 million 30 Jun 2020: $23.6 million
Claims
Certain claims arising out of engineering and construction contracts have been made by, or against, controlled entities in the
ordinary course of business. The Directors do not consider the outcome of any of these claims will be materially different to
the position taken in the financial accounts of the Group.
MACA LIMITED ANNUAL REPORT 2021
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SECTIONS TO THE FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
6.6 EVENTS AFTER BALANCE SHEET DATE
The Directors have recommended a final dividend payment of 2.5 cents per share. Refer to Section 5.7 for details.
Subsequent to the year end, the following items have been announced by the Group:
- MACA has awarded Bowen Coking Coal Ltd (ASX:BCB) a Preferred Bidder Status in the sale process for the Bluff PCI Mine
conducted by FTI Consulting as receivers and managers and controllers.
- Ms Sandra Dodds has resigned as a Director of the board effective 30 September 2021.
Other than the above, there has not been any matter or circumstance occurring subsequent to the end of the financial year
that has significantly affected, or may significantly affect, the operations of the Group, the results of those operations, or the
state of affairs of the Group in future financial years.
6.7 PARENT ENTITY DISCLOSURES
The following information has been extracted from the books and records of the Company and has been prepared in
accordance with Accounting Standards
Statement of Financial Position
Assets
Current Assets
Total Assets
Liabilities
Current Liabilities
Total Liabilities
Equity
Issued Capital
Reserves
(Accumulated Losses) / Retained Profits
Total Equity
Statement of Financial Performance
Profit For the Year (Including Interco Dividends)
Total Comprehensive Income
Guarantees
30 June
2021
$’000
30 June
2020
$’000
18,173
449,790
38,073
379,041
2,529
2,529
434,790
591
11,880
447,261
12,720
12,720
1,718
1,718
362,329
591
14,403
377,323
15,064
15,064
MACA Limited has entered into guarantees for certain equipment finance facilities and loan in the current financial year, in
relation to the debts entered into by its subsidiaries.
113
MACA LIMITED ANNUAL REPORT 2021
INDEPENDENT AUDIT REPORT
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF MACA LIMITED
REPORT ON THE AUDIT OF THE FINANCIAL REPORT
Opinion
Moore Australia Audit (WA)
Level 15, Exchange Tower,
2 The Esplanade, Perth, WA 6000
PO Box 5785, St Georges Terrace, WA 6831
T +61 8 9225 5355
F +61 8 9225 6181
www.moore-australia.com.au
We have audited the financial report of MACA Limited (the Company) and its subsidiaries (the “Group”), which
comprises the consolidated statement of financial position as at 30 June 2021, the consolidated statement of
comprehensive income, the consolidated statement of changes in equity and the consolidated statement of
cash flows for the year then ended, and notes to the financial statements, including a summary of significant
accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
i.
ii.
giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its financial
performance for the year then ended; and
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section
of our report. We are independent of the Group in accordance with the auditor independence requirements
of the Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical Standards
Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the “Code”)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical
responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given
to the directors of the Group, would be in the same terms if given to the directors as at the time of this
auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our
audit of the financial report of the current period. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
Moore Australia Audit (WA) – ABN 16 874 357 907.
An independent member of Moore Global Network Limited - members in principal cities throughout the world.
Liability limited by a scheme approved under Professional Standards Legislation
MACA LIMITED ANNUAL REPORT 2021
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INDEPENDENT AUDIT REPORT (CONTINUED)
Key Audit Matters (continued)
Existence and Ownership of Assets – Plant and Equipment
Refer to Note 4.4 “Property, Plant and Equipment”
Existence and ownership of plant and equipment is
a key audit matter.
It is due to the size of this account balance and the
location of plant and equipment (mostly at remote
client mine sites) that this is a key area of audit
focus.
Our procedures included:
(cid:120) We agreed a sample of plant and equipment
additions to supplier invoices and to Capital
Expenditure Request Forms (for appropriate
authority).
(cid:120) We agreed a sample of plant and equipment to
hire purchase financing agreements.
(cid:120) We agreed a sample of plant and equipment to
date stamped photography taken by senior
MACA personnel.
Impairment Assessment of Property Plant & Equipment
Refer to Notes 4.4 “Property, Plant and Equipment”
Refer to Section 2 Key Estimates & Judgements – “Impairment of Property, Plant & Equipment”
Property, plant and equipment (“PPE”) represents
the Group’s largest asset with a year-end book value
of approximately $479 million. Given the Group’s
net asset position exceeds its market capitalisation
at balance date, an impairment trigger event has
arisen under AASB 136 Impairment.
Our procedures included, amongst others:
the
As a result, an impairment assessment has been
made by management of the recoverable amounts
of each of the Group’s operating segments (or Cash
Generating Units or CGUs). An impairment is
recognised if the carrying amount of the Group’s
PPE is less than its recoverable amounts, being the
higher of fair value less costs of disposal and value-
in-use (VIU).
The
impairment assessment undertaken has
resulted in no impairment to the PPE employed in
all CGUs.
The recoverable amounts of the Group’s PPE were
key audit matters due to the significant judgment
involved in forecasting future cash flows and the
selection of assumptions.
including assessing
(cid:120) Evaluating the value-in-use (VIU) discounted
cash flow model developed by management to
assess the recoverable amount of the underlying
assets
following
assumptions:
- discount & growth rates
- forecast cash flows and capital expenditure
- terminal growth rate
Where possible, we corroborated assumptions
by reference to external data and new or
renewed contracts awarded to / announced by
the Group to-date
(cid:120) Checking the mathematical accuracy of the cash
flow models
(cid:120) Assessing the historical accuracy of forecasting
of the Group
(cid:120) Reviewing the sensitivity analysis performed
under the impairment model for reasonableness
(cid:120) In
to
the
relation
substantial
fleet of
plant/equipment and other assets acquired by
the Group as part of the Open Cut Mining West
acquisition (discussed in more detail below), we
assessed the reliability of third-party valuations
utilised by management. The valuer’s underlying
assumptions, objectivity, competency and
capabilities were also evaluated.
(cid:120) Assessing the appropriateness of the relevant
disclosures in the financial statements
115
MACA LIMITED ANNUAL REPORT 2021
INDEPENDENT AUDIT REPORT (CONTINUED)
Key Audit Matters (continued)
Recognition of Revenue
Refer to Note 3.1 “Revenue and Other Income”
The Group’s revenue is predominantly derived from
the rendering of mining and other services, all of
which are based on contracts which determine the
services, products and rates to be charged.
The accurate recording of revenue
dependent upon the following key factors:
is highly
(cid:120) Knowledge of the individual characteristics and
status of contracts
(cid:120) Management’s invoicing process including:
(cid:16) accurate measurement of work done and
services provided each month
(cid:16) invoices prepared
in compliance with
contract terms such as services performed
and rates charged
(cid:16) by reference to the stage of completion of
the contract activity (using the input method
under AASB 15) at balance date
for
civil/infrastructure works.
(cid:120) Recognition of variations and claims,
in
accordance with contractual terms and based on
an assessment as to when the Group believes it
is highly probable that a significant reversal in
the amount of revenue recognised will not occur
when the uncertainty associated with the
variable consideration is subsequently removed.
The above determinations will also impact on
account balances such as Work In Progress (WIP),
Accrued Income and Unearned Revenue
We focused on this matter as a key audit matter due
to the significance of contract-based revenue to the
Group combined with the need to comply with a
to
variety of contractual conditions,
judgemental
revenue
recognition.
associated with
leading
risk
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Our procedures included, amongst others:
(cid:120) We
evaluated management’s
processes
regarding existence and valuation of the Group’s
contract revenues. We tested internal controls
in relation to preparation and authorisation of
monthly revenue invoices for compliance with
the Group’s policy
revenue
recognition
relating
to
(cid:120) We selected a sample of sales invoices raised
during the year (and post year-end) and
performed the following procedures:
(cid:16) agreed to contractual terms and rates
(cid:16) agreed to general
ledger accounts and
subsequent receipts from the customer
(cid:16) for variations or claims we checked they
were in accordance with contract terms and
evaluated for risk of non-recovery
(cid:16) revenue cut-off testing
(cid:120) We evaluated and tested, on a sample basis,
inputs such as materials, subcontractors etc
used by management in their estimation of total
costs to complete
(cid:120) We recomputed the percentage of completion
based on actual cumulative contract costs
incurred to date to the total estimated contract
costs for individually significant projects.
(cid:120) We evaluated contract performance during and
subsequent to year-end up to audit opinion date
to reflect on year end revenue recognition
judgements. As part of this process, we
challenged the appropriateness of variations and
claims included in the computation of contract
revenue and whether it is highly probable that
the revenue recognised will not subsequently be
reversed
(cid:120) We also reviewed and assessed the adequacy of
the disclosures in relation to key accounting
estimates
MACA LIMITED ANNUAL REPORT 2021
116
Accounting for business acquisitions & related borrowings
Refer to Notes 6.1 Business Combination, 5.2.1 Interest Bearing Liabilities & 4.6 Deferred Consideration
Payable
On 1 February 2021, the Group completed its
acquisition of the Open Cut Mining West (“Mining
West”) business of Downer EDI Limited (“EDI”) for
$175 million. The consideration was partly financed
by bank borrowings.
(cid:120) We reviewed the purchase agreement to
understand the key terms and conditions of the
acquisition
Our procedures included, amongst others:
(cid:120) Critically evaluating
the assumptions and
methodology in management’s value in use
model, such as forecast revenues, operating
costs and contributory assets used to determine
the value of the customer contract intangible
(cid:120) Engaging
internal Corporate Finance and
valuation specialists to review the value in use
model
for appropriateness based on our
knowledge of the Group
(cid:120) Assessing the reliability of third-party valuations
utilised by management in their determination
of fair value of the major assets acquired (such
as plant/equipment and inventories).
(cid:120) Obtaining respective confirmations from EDI and
the bank for the deferred consideration payable
and the net loan payable at balance date
(cid:120) Assessed the maturity profile of the bank loan to
check that amounts due within the next 12
months were classified as current liabilities
(cid:120) Checked the Group’s compliance with financial
debt covenants at balance date
(cid:120) Assessing the appropriateness of the relevant
disclosures in the financial statements
FINANCIAL REPORT
INDEPENDENT AUDIT REPORT (CONTINUED)
Key Audit Matters (continued)
The acquisition comprised of plant/equipment,
inventory, other assets and associated employee
entitlement liabilities and the novation of existing
customer contracts.
Accounting for this transaction is complex, requiring
management to exercise judgment to determine the
fair value of acquired assets and liabilities, including
contracts and determining
the allocation of
purchase consideration to separately identifiable
intangible assets such as customer contracts.
We focussed on this area as a key audit matter due
to the size of the acquisition, the judgment involved
in accounting
the
significance of the bank borrowings including the
Group’s compliance with
financial and other
conditions.
transaction and
this
for
117
MACA LIMITED ANNUAL REPORT 2021
INDEPENDENT AUDIT REPORT (CONTINUED)
Key Matters (continued)
Valuation of Receivables
Refer to Note 4.1 “Trade and Other Receivables” and “Loans to Other Companies”
Refer to Note 5.3 “Financial Risk Management”
Valuation of receivables is a key audit matter.
Our procedures included, amongst others:
It is due to the size of the account balances and the
judgements required in determining their carrying
value that this is a key area of audit focus.
Trade debtors and debtors subject to payment
arrangements amounted to a total of $294.12
million as at 30 June 2021. Of this amount, $7.13
million relates to the remaining value of the trade
receivable
from Carabella Resources Pty Ltd
(“Carabella”) following the credit loss impairment in
FY2020.
Loans to Other Companies (Carabella) amounted to
$26.84 million as at 30 June 2021. This amount is
expected to be collected over a period of longer
than the next 12 months as Carabella is under
receivership. The underlying security assets are
currently being offered for sale by the receivers and
managers.
The Group assesses periodically and at each year
end the expected credit loss (“ECL”) associated with
its receivables.
(cid:120) Review of subsequent sales invoices and related
claim documentation in respect of accrued
revenue.
(cid:120) Review of the level of credit insurance coverage
for each debtor, subsequent receipt collections
from debtors and ageing analysis post year end.
(cid:120) Confirmations with selected trade & other
debtors where considered necessary.
(cid:120) Review
of
security
agreements
arrangements entered into in respect of loan
facilities provided to borrowers.
and
(cid:120) In relation to the net amounts due from
Carabella Resources, we
latest
correspondence and other documents relating
to the status of the external administration /
receivership process
reviewed
other
including
receivables,
(cid:120) Review of AASB 9 ECL workings and assessments
prepared by management in relation to trade
and
the
independent valuation report obtained for
secured assets, an analysis of the credit risk
characteristics attributed to a significant trade
debtor and borrower, as part of our assessment
of
independent valuer’s
assumptions, objectivity, competency and
capabilities were also evaluated.
impairment. The
(cid:120) Discussion with management and the directors
as to the existence of other arrears/disputes
with
related
correspondence and the impact these factors
have had on the assessment and adequacy of
the ECL impairment provision recognised.
trade debtors,
review of
(cid:120) Assessment of the financial viability and future
prospects of debtors, where considered
available
on
necessary
information and other information available to
the Company.
publicly
based
(cid:120) Review of the classification of receivables
between current and non-current ensuring that
classification reflects the agreements entered
into with customers and borrowers.
(cid:120) Review of disclosures made in the notes to the
financial statements
MACA LIMITED ANNUAL REPORT 2021
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FINANCIAL REPORT
INDEPENDENT AUDIT REPORT (CONTINUED)
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2021, but does not include the financial
report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial report or our
knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Group are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal
control as the directors determine is necessary to enable the preparation of the financial report that gives a
true and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations,
or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with the Australian Auditing Standards will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of this
financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and
Assurance Standards Board website at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2021.pdf.
This description forms part of our audit report.
REPORT ON THE REMUNERATION REPORT
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the Directors’ report for the year ended 30 June 2021.
In our opinion, the Remuneration Report of MACA Limited, for the year ended 30 June 2021 complies with
section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Group are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on
the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
SL TAN
PARTNER
MOORE AUSTRALIA AUDIT (WA)
CHARTERED ACCOUNTANTS
Signed at Perth this 24th day of September 2021
119
MACA LIMITED ANNUAL REPORT 2021
SHAREHOLDER INFORMATION
As at 31 August 2021
NUMBERS OF HOLDERS OF EQUITY
SECURITIES ORDINARY SHARECAPITAL
341,710,846 fully paid ordinary shares are held by 9,052 individual shareholders.
Financial instruments are initially measured at fair value plus transaction costs, except where the instrument is classified
‘at fair value through profit or loss’, in which case transaction costs are expensed to profit or loss immediately.
LISTED OPTIONS
There are no listed options.
UNLISTED OPTIONS
There are no unlisted options.
DISTRIBUTION OF SHAREHOLDINGS
Fully Paid Ordinary Shares
1 -1,000 shares
1,001 –5,000 shares
5,001 –10,000 shares
10,001 –100,000 shares
100,001 and over shares
Total
Number of
Shareholders
1,357
3,359
1,795
2,375
166
9,052
Number of
Shares
870,960
9,524,993
13,466,289
63,471,867
254,376,737
341,710,846
% of Issued
Capital
0.25%
2.79%
3.94%
18.57%
74.44%
100.00%
SUBSTANTIAL SHARE AND OPTION HOLDERS
An extract of the Company’s register of substantial shareholders (who held a relevant interest in 5% or more of issued
capital) is set outbelow:
Substantial Shareholder
HSBC Custody Nominees (Australia) Limited
J P Morgan Nominees Australia Pty Limited
Citicorp Nominees Pty Limited
Mr Kennerth Rudy Kamon
Fully Paid
Ordinary Shares
46,180,291
37,228,493
36,316,383
21,076,681
% of Total
Shares
13.51%
10.89%
10.63%
6.17%
There were no substantial option holders listed in the Company’s register as at 31 August 2021.
OTHER INFORMATION
The voting rights attached to ordinary shares are governed by the Constitution of the Company. On a show of hands every
person present who is a Member or representative of a Member shall have one vote on a poll, every Member present in
person or by proxy or by attorney or duly authorised representative shall have one vote for each share held. None of the
options have any voting rights.
UNMARKETABLE PARCELS
As at 31 August 2021, there were 551 holders who held shares that were unmarketable parcels.
MACA LIMITED ANNUAL REPORT 2021
120
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FINANCIAL REPORT
SHAREHOLDER INFORMATION (CONTINUED)
MLD’S TOP TWENTY SHAREHOLDERS
Registered Shareholder
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
CITICORP NOMINEES PTY LIMITED
MR KENNETH RUDY KAMON
GEMBLUE NOMINEES PTY LTD
MR FRANCIS JOSEPH MAHER + MS SHARON JANE MAHER
BNP PARIBAS NOMINEES PTY LTD
NATIONAL NOMINEES LIMITED
AIGLE ROYAL SUPERANNUATION PTY LTD
MR KENNETH JOSEPH HALL
MR JAMES EDWARD MOORE + MS JULIA CATHERINE MOORE
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
BNP PARIBAS NOMS PTY LTD
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM
MORGAN STANLEY AUSTRALIA SECURITIES (NOMINEE) PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD
MR FRANCIS JOSEPH MAHER + MRS SHARON JANE MAHER
BOND STREET CUSTODIANS LIMITED
MRS TINA LOUISE HARDY
UBS NOMINEES PTY LTD
Fully paid
Ordinary shares
% of total
shares
46,180,291
37,228,493
36,316,383
21,076,681
12,863,816
11,800,000
11,487,020
8,824,722
5,000,000
5,000,000
4,606,250
3,184,849
3,046,940
2,403,076
2,083,206
1,903,110
1,837,500
1,730,000
1,467,412
1,193,439
13.51
10.89
10.63
6.17
3.76
3.45
3.36
2.58
1.46
1.46
1.35
0.93
0.89
0.70
0.61
0.56
0.54
0.51
0.43
0.35
TOTALS: TOP 20 HOLDERS OF ORDINARY FULLY PAID SHARES (TOTAL)
ORDINARY FULLY PAID SHARES ON ISSUE
219,233,188
341,710,846
64.16
100.00
RESTRICTED SECURITIES
There were no restricted securities at the date of this report.
VOTING RIGHTS
ORDINARY SHARES
For all ordinary shares, voting rights are on a show of hands whereby every member present in person or by proxy shall
have one vote and upon a poll, each share shall have one vote.
OTHER INFORMATION
MLD Limited is incorporated and domiciled in Australia and is a publicly listed company by shares.
COMPANY DETAILS
The registered office is:
MACA Limited
45 Division Street
Welshpool, Western Australia, 6106
121
MACA LIMITED ANNUAL REPORT 2021
The principal place of business:
MACA Limited
45 Division Street
Welshpool, Western Australia, 6106
MACA Limited and its Controlled Entities
ABN 42 144 745 782
Perth
45 Division Street,
Welshpool WA 6106
E: Info@maca.net.au
T: +61 8 6242 2600
maca.net.au