AnnuAl
RepoRt
2016
Financial Statements
For the period ended 31 March 2016
Metro PerforMance Glass liMited contentS
1
Metro PerforMance Glass liMited Who we are
Chairman’s review
Chief Executive’s review
Board of Directors
Executive Team
Statement of comprehensive income
Statement of financial position
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
1
2
3
4
5
6
Basis of preparation
Financial performance
Working capital
Long term assets
Debt and equity
other
Independent auditor’s report
Corporate Governance
Statutory information
Company directory
3
5
7
9
11
15
16
17
19
21
21
23
25
33
38
41
47
49
63
73
AnnUAL RePoRt 2016
2
Metro PerforMance Glass liMited
WHo We ARe
With over 800 staff and seventeen branches located throughout
the country, we supply and service the architectural, building
and residential markets with industry leading glass products.
Whether it be high performance Low E double glazing units for
new builds or the retrofit market, bathroom shower screens,
kitchen splashback or pool and deck balustrades, Metro
Performance Glass have been at the forefront of providing
performance glass products and industry leading customer
service, what we like to call Performance without Compromise.
Other Metro
Glass Sites
Christchurch Glass
35 Hammersmith Drive
Wigram, Christchurch
(03) 343 5103
Auckland Retrofit
15 Woodson Place
Wairau Valley
(09) 415 0470
Mint Glass
19 Ra Ora Drive,
Auckland
0800 000 303
Capital Glass
65 Seaview Road,
Lower Hutt
(04) 586 7245
Mainland Glass and
Mint Glass
105 Orbell St,
Christchurch
(03) 377 0938
Napier
9 Niven Street
Onekawa, Napier
(06) 843 3777
Palmerston North
193 John F Kennedy
Drive
Palmerston North
(06) 354 2071
Taranaki
9 Oropuriri Road
New Plymouth
(06) 758 8366
Nelson
146 Tahunanui Drive
Nelson 7011
(03) 546 5365
Cromwell
Ree Crescent
Cromwell, Central
Otago
(03) 445 4530
Dunedin
140 Portsmouth Drive
Dunedin
(03) 477 9485
Metro
Performance
Glass
Auckland (Head Office)
5 Lady Fisher Place
Highbrook, Auckland
(09) 927 3000
Bay of Plenty
88 Portside Drive
Mt Maunganui, Bay of
Plenty
(07) 575 5503
Wellington
18 Jamaica Drive
Grenada North,
Wellington
(04) 232 9920
Christchurch
700 Halswell Junction
Road
Hornby, Christchurch
(03) 348 4184
Metro Direct &
Retrofit
Whangarei
28 Porowini Ave
Whangarei
(09) 438 9399
Hamilton
32 The Boulevard
Te Rapa Park, Hamilton
(07) 850 6371
3
3
Metro PerforMance Glass liMited
oUR PeoPLe
MetRo peRfoRMAnce GlAss
is new ZeAlAnd’s lARGest
And Most innovAtive GlAss
pRocessoR, distRibutoR
And GlAZieR.
AnnUAL RePoRt 2016
4
Metro PerforMance Glass liMited cHAiRMAn’S
RevieW
MetRo GlAss hAs coMpleted
its fiRst full finAnciAl yeAR
As A publicly listed coMpAny
hAvinG deliveRed A stRonG
Result, while continuinG to
invest to ensuRe it is well
positioned to benefit fRoM
the siGnificAnt oppoRtunities
it sees eMeRGinG within the
MARketplAce.”
“
5
Metro PerforMance Glass liMited FINANCIAl RESulTS
The company has benefited from operational
improvements and continued growth in housing and
commercial construction markets. Annual revenue grew
by approximately 10% to $188.0 million, when compared
to the prior 12 months on a pro-forma basis. This growth
was achieved despite external industry constraints,
including certain supply shortages and ongoing
execution delays in the commercial construction market.
Accordingly, a large number of commercial projects
that the company has won, have had commencement
dates pushed back. Net profit after tax was $20.5
million, within the guidance range provided with the
company’s half year results released in November 20151.
DIvIDEND
Reflecting directors’ confidence in the future,
the board has declared a fully imputed final
dividend of 4.0 cents per share, taking total
dividends for the year to 7.6 cents per share.
The record date for dividend entitlements is 8 July
2016 and the payment date is 25 July 2016.
OuTlOOk
Metro Glass will continue to be successful by
focussing on customer demands and delivering
market-leading products, while striving to deliver
all of this at New Zealand’s lowest cost.
The prior financial year’s reported revenue of $115.0
million and net profit after tax of $9.6 million are
not directly comparable to this year’s result as
they covered only eight months of trading2.
Gross profit margins improved during the year
as the company realised efficiency benefits in its
four glass processing plants. However glazing
costs increased reflecting the company’s strategic
decision to build its glazing capability in advance of
executing its commercial forward order book.
Gearing3 has improved to 22.7% as at 31 March
2016 from 24.9% in the prior year, leaving the
company in a strong position with adequate financial
flexibility to fund future growth opportunities.
OPERATIONAl RESulTS
Our business model is driven by customised product,
short lead times and a broad product range that requires
a flexible approach to manufacturing. Using this model,
the company increased its market share in the residential
double glazing market by an estimated 3% and grew
its commercial order book by 70% to $27.0 million as at
31 March 2016. Additionally, its Retrofit double glazing
business has continued its rapid development, offering
strong prospects for long-term, counter-cyclical growth.
The company is fortunate in that its people are
committed to this vision and the Board thanks all staff
and stakeholders for their efforts over the past year.
The company is enjoying favourable market
conditions and is well positioned for the future.
On behalf of the Board
1On 23 November 2015 Metro Glass said it was maintaining its guidance for
revenue and net profit after tax for the year to 31 March 2016 in the vicinity of
$190 million and in the range of $20 - $22 million respectively.
2The Company began trading only after acquiring Metroglass Holdings Limited
at the time of NZX / ASX listing in July 2014.
3Gearing: net interest bearing debt / (net interest bearing debt + equity).
AnnUAL RePoRt 2016
6
Metro PerforMance Glass liMitedSir John Goulter KNZM, JP Chairman 24th June 2016 Chief exeCutive’s RepoRt
MARkET OvERvIEW
Metro Performance Glass is performing well and
benefiting from favourable market conditions. Construction
activity and building consents have recovered to levels
last seen prior to the Global Financial Crisis as the sector
benefits from record net migration, low interest rates and
a historical residential under-build. The company sees no
sign of this momentum slowing in the immediate future.
New Zealand residential consents grew 11% in the year
to 31 March 2016, reaching some 27,800. Consent growth
was led by the upper North Island with twelve month
consent growth in the Northland, Waikato and Bay of
Plenty regions each exceeding 30% year-on-year.
Auckland residential consents rose 20% to 9,500
over the past twelve months, but this is still
well short of the level required to keep up with
population growth in the city, let alone that needed
to make up the growing backlog of demand.
Metro Glass’ Business Model
Customised produCt
+ New Zealand residential windows are generally
measured to size once a house is built to take into
account variations in window size
+ There is a practise of made-to-order customisation
when building houses in New Zealand
+ There are few large project builders in New Zealand
(~75% of houses built by builders erecting <30
houses p.a.)
Consent issuance in Canterbury remains at historically
elevated levels but activity has been declining over
the past 12 months as expected, with the post-
earthquake residential rebuild largely complete.
Commercial construction markets are lumpy,
but we continue to see a significant pipeline of
projects both consented and yet to gain consent,
particularly in Auckland and Christchurch.
STRATEGy
Metro Glass’ business model is driven by customised
product, short lead times and a broad product range that
requires a flexible approach to manufacturing. Combining
this business model with Metro Glass’ scale, people
and intellectual property enables the company to both
protect and further strengthen its market leadership.
short lead time
+ Industry standard for delivery of windows and other glass
products is less than 3 days for window frame fabricators
+ Broad geographical spread requires strong distribution
capabilities and a national network
- 50% of population in areas <150,000 people
- Metro Glass has 17 sites across NZ, including four major
processing sites
+ Complex delivery model – increasing due to weight of double
glazed units (DGU) & shelf life of performance glass
flexible manufaCturing
broad produCt range
equipment and proCesses
+ Automated manufacturing that is flexible enough to
allow for mass customisation with short lead times
+ Differentiated from other glass markets that are
either annealed cut-to-size markets (like Australia has
been historically) or very standardised
+ New Zealand low cost driven by scale and automation
+ Full service offering with on-site and
structural glazing
+ Wide range of quality glass products - “one stop shop”
- High technology glass, including LowE
- Thicknesses ranging from 2mm to 19mm
- Digital printing, painting, toughening and lamination
- Many effects (e.g. tinted, figured, mirrored)
- Double glazed windows, cut-to-size balustrades,
shower screens, splashbacks, safety glass, doors, etc
- EzyClean protective coating
7
7
Metro PerforMance Glass liMited
Customer service levels, as measured by the proportion
of orders Metro Glass delivered in full and on time (DIFOT),
were variable and below our high in-house standards4.
This performance reflected the pressures imposed by
record glass volumes and the growing demand for high-
specification glass which is more complex to process.
It also reflected external market constraints including
disruptions to the supply of certain materials.
The construction and commissioning of the Auckland
factory brought to a close the company’s recent
capacity expansion programme. During the year the
company invested $11.4 million in new capabilities
including market-leading edge-working, digital printing
and lamination capabilities at the Auckland processing
plant and continued the upgrade and expansion of our
vehicle service fleet. We also continued to develop our
distribution channels and customer service capabilities.
These efforts included three small “bolt-on” acquisitions5.
Additionally, the company also made important
investments in improving health and safety,
through new equipment, systems and processes,
all of which delivered favourable results.
SuMMARy
We are pleased with the progress the company
has made over the past twelve months, and thank
our dedicated people for their efforts.
Metro Glass is enjoying favourable market
conditions and is well positioned for the future.
nigel Rigby
Director & chief executive
24th June 2016
4With all plants now running in a ‘business-as-usual’ state, Metro Glass has
ceased reporting actual DIFOT data externally.
5Acquired certain assets of Mainland Glass (Christchurch), Ultra Glass
(Wellington) and Mint Glass (multiple regions).
AnnUAL RePoRt 2016
8
OPERATIONAl uPDATE
Excellent progress was made on all operational priorities
for the year. The company increased both its revenue and
its market share of residential double glazed windows.
The company targeted a greater share of the growing
commercial construction market and its positive
progress can be seen in the 70% growth in our forward
order book of commercial projects. In anticipation of
this growth, we have invested significantly in glazing
capabilities and resources ahead of the execution
curve. This was one of the key drivers in staff numbers
which increased from 750 to 800 during the year.
We also sought to drive our Retrofit double glazing business,
which offers to underpin the company’s longer-term
earnings. These efforts were rewarded with a 39% increase
in revenue and we expect to maintain this strong momentum
into the future. Investments have included online sales
tools that assist with quoting retrofitted doubled glazed
units, as well as a significant brand advertising campaign.
We continue to target both a service and cost leadership
position through manufacturing excellence. Our four
processing plants in Auckland, Christchurch, Wellington and
Bay of Plenty each processed record volumes of glass and
achieved improved labour productivity with the new Auckland
plant in particular beginning to deliver tangible cost savings.
That said, the company still sees further opportunities
to drive continued manufacturing improvement.
Metro PerforMance Glass liMited BoARD of DiReCtoRs
SIR JOHN GOulTER kNZM, JP
Independent, Non-Executive
Chairman and Member of Audit and
Risk Committee
NIGEl RIGBy
Executive Director and Chief
Executive Officer
GORDON BuSWEll
Independent, Non-Executive Director
Sir John has long-standing experience in
Nigel was appointed as Chief Executive
Gordon has more than 25 years’ experience
both the public and private sectors in New
Officer of Metro Performance Glass in
in the building and construction industry.
Zealand. He currently acts as Chairman of
2012. Nigel has over 15 years’ of experience
He currently holds a number of industry
the New Zealand Business and Parliament
working in the building products sector in
associated directorships, including the
Trust, Marsden Maritime Holdings Limited,
New Zealand, Australia, Asia and the United
Building Industry Federation, Platinum
and Northport Limited. He is a former Chair
States.
of the NZ Lotteries Commission and NZ
Carriers Group; a former director of the
Reserve Bank of New Zealand, Television
NZ Limited, Vector Limited and was the
inaugural Managing Director of Auckland
International Airport Limited.
Prior to joining Metro Performance Glass,
Nigel was with the James Hardie group
for 13 years, including Executive General
Manager – USA for James Hardie. In
Homes Limited, Construction Strategy
Group and the Registered Master Builders
Association of New Zealand. He is also a
member of the New Zealand Institute of
Directors.
this role he led James Hardie’s largest
Prior to moving into governance roles,
international business division, which
Gordon was the chief executive of
In 2003, Sir John was appointed the New
included managing large and complex
Independent Timber Merchants (ITM) for 13
Zealand Herald Business Leader of the
Year and a Distinguished Companion of the
capital projects as well as the day-to-day
management and responsibility for the
years and also spent 12 years with Carter
Holt Harvey.
Gordon holds a Bachelor of Commerce from
the University of Auckland.
New Zealand Order of Merit (DCNZM) for
performance of this division.
services to business and the community.
This honour was re-designated as Knight
Companion of the New Zealand Order of
Merit (KNZM) in 2009.
Sir John is a graduate of Harvard Business
School (Advanced Management Program),
a Justice of the Peace and a Fellow of the
New Zealand Institute of Management. He
was inducted as a Laureate into the New
Zealand Business Hall of Fame in 2003.
9
Metro PerforMance Glass liMited MICHAEl AlSCHER
Non-Executive Director
RuSSEll CHENu
Independent, Non-Executive
Director and Chairman of Audit & Risk
Committee
WIllEM (BIll) ROEST
Independent, Non-Executive Director
and Member of Audit & Risk Committee
Michael is the Managing Partner and
Russell has significant experience in the
Bill has extensive experience in the New
founder of Crescent Capital Partners, a
corporate sector with more than 22
Zealand corporate sector both in executive
leading Australian based private equity
years in senior management roles. He has
and non-executive functions, in particular
firm with $1.5 billion in funds under
considerable experience in financial roles,
in the domains of finance and corporate
management, specialising in high growth
including with building products companies.
governance.
companies and certain industries such as
Russell is currently an independent
healthcare and the services sector across
director and the Chairman of the Audit and
multiple disciplines. Prior to founding
Risk Committee of ASX listed businesses
Crescent in 2000, Michael was a strategy
Leighton Holdings Limited and Reliance
consultant at Bain International and the
Worldwide Corporation Limited.
LEK Partnership as well as holding several
senior operating roles.
Russell had a 23 year career at James
Hardie, holding various management
Michael is currently the Chairman of
and executive positions in a number of
Cardno Limited and a Non-Executive
Director of ClearView Limited which are
countries, including most recently serving
as group Chief Financial Officer from 2004
both listed on the ASX. He is also the Non-
to 2013.
He is currently on the boards of Synlait
Milk (where he chairs the Audit and Risk
Committee), Fisher & Paykel Appliances
(where he chairs the Audit Committee) and
New Zealand Housing Foundation.
Prior to his non-executive roles, Bill held
the position of Chief Financial Officer at
Fletcher Building for 12 years. Before this,
he held several leadership roles within
the Fletcher Group, including Managing
Director of Fletcher Residential and
Executive Chair of Australian Clinical Labs
and National Dental Care.
Before this role, Russell served as Chief
Fletcher Aluminium.
Financial Officer for several ASX-listed
Michael holds a Bachelor of Commerce
companies (Tab, Delta Gold, Australian
(Finance & Mathematics) from the
National Industries and Pancontinental
University of New South Wales.
Mining) and Mighty River Power. Russell
was also previously Treasurer of Pioneer
International.
Russell has a Bachelor of Commerce
from The University of Melbourne, an
MBA from Macquarie Graduate School
of Management and is a Member of
the Society of Certified Practising
Accountants (Australia).
Bill is a Fellow of the Association of
Chartered Certified Accountants (United
Kingdom) and an Associate member of the
Chartered Accountants Australia and New
Zealand.
AnnUAL RePoRt 2016
10
Metro PerforMance Glass liMited exeCutive teAM
JOHN FRASER-MACkENZIE
Chief Financial Officer
GEOFF RASMuSSEN
General Manager Operations
DEAN BROWN
General Manager North Island
John was appointed Chief Financial Officer
Geoff has more than 18 years’ of
Dean joined Metro Performance Glass
and Company Secretary in May 2015.
experience in various senior management
as North Island General Manager in July
Prior to his appointment, John worked for
roles at Metro Performance Glass and was
2015. Dean has held a number of senior
Goodman Fielder for eight years, initially as
appointed General Manager, Operations in
roles in the manufacturing and processing
Finance Director of the Dairy Division and
April 2011.
Geoff has 30 years’ of experience in
the glass industry combining a trade
industries, most recently being the Upper
North Island General Manager for Waste
Management.
background with experience including sales,
Dean has an MBA from Auckland University.
production and operations management.
latterly as New Zealand Finance Director.
Prior to Goodman Fielder he held a number
of business development and finance roles
for Heinz in Europe.
John is a chartered accountant and holds
a Bachelor of Business Science in Finance
from the University of Cape Town.
11
Metro PerforMance Glass liMited BARRy PATERSON
General Manager South Island
lEN HATTON
General Manager People and
Organisational Development
Barry has 15 years’ of experience across
Len has over 20 years’ Human Resources
the New Zealand and Australian glass
experience gained in the FMCG,
industries. He has held a diverse range of
pharmaceutical, cosmetics, tourism and
commercial and management finance roles
publishing sectors, most recently spending
in the arable and manufacturing industries,
6 years leading Human Resources for APN
and was elected to the Westland Milk
News & Media New Zealand.
Products board in November 2010.
Len holds a Masters of Social Sciences
Barry holds a Bachelor of Commerce and
with Honours from the University of
Management and a Post Graduate Diploma
Waikato.
in Marketing.
AnnUAL RePoRt 2016
12
Metro PerforMance Glass liMited 13
Metro PerforMance Glass liMited oUR ReSULtS
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Consolidated Statement of Cash Flows (continued)
Notes to the financial statements
1.
2.
2.1
2.2
2.3
2.4
3.
3.1
3.2
3.3
3.4
4.
4.1
4.2
5.
5.1
5.2
6.
6.1
6.2
6.3
6.4
Basis of preparation
Financial Performance
Segment information
Revenue
operating expenditure
earnings per share
Working capital
trade and other receivables
inventories
trade and other payables
Financial instruments
Long term Assets
Property, plant and equipment
intangible assets
Debt & equity
interest bearing liabilities
contributed equity
other
income taxation
Deferred taxation
Reserves
Related party transactions
15
16
17
19
20
21
21
23
23
23
24
25
25
25
27
28
29
33
33
35
38
38
39
41
41
42
44
45
AnnUAL RePoRt 2016
14
Metro PerforMance Glass liMited
ConsoliDAteD stAteMent of CoMpRehensive inCoMe
for the period ended 31 March
12 Months
Consolidated
8 Months
Consolidated
Notes
2016
$’000
2.3
2.3
2.3
2.3
6.1
188,037
(90,724)
97,313
(35,329)
(8,774)
(23,086)
30,124
(3,380)
210
26,954
(6,459)
20,495
2015
$’000
114,998
(57,205)
57,793
(19,779)
(4,879)
(16,059)
17,076
(2,118)
28
14,986
(5,427)
9,559
Sales revenue
Cost of sales
Gross profit
Distribution and glazing related expenses
Selling and marketing expenses
Administration expenses
Operating profit
Interest expense
Interest income
Profit before income taxation
Income taxation expense
Profit for the period
Other comprehensive income
Items that may be subsequently reclassified to profit or loss:
Cash flow hedges
Total comprehensive income for the period attributable to shareholders
(2,324)
18,171
1,122
10,681
Earnings per share
Basic earnings per share (cents per share)
Diluted earnings per share (cents per share)
2.4
2.4
11.1
11.1
5.3
5.2
The Board of Directors authorised these financial statements for issue on 26 May 2016.
For and on behalf of the Board:
sir John Goulter, knZM, Jp
chairman
nigel Rigby
chief executive officer
The above Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
15
Metro PerforMance Glass liMited ConsoliDAteD stAteMent of finAnCiAl position
at 31 March
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Derivative financial instruments
Current income tax asset
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Deferred tax assets
Intangible assets
Total non-current assets
Total assets
liabilities
Current liabilities
Trade and other payables
Income tax liability
Derivative financial instruments
Provisions
Total current liabilities
Non-current liabilities
Deferred tax liabilities
Interest bearing liabilities
Lease incentive
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Retained earnings
Group reorganisation reserve
Share based payments reserve
Cash flow hedge reserve
Total equity
Consolidated
2016
$’000
Consolidated
2015
$’000
Notes
3.1
3.2
3.4
4.1
6.2
4.2
3.3
3.4
6.2
5.1
5.2
6,404
25,858
17,655
-
-
2,538
52,455
47,997
2,715
127,743
178,455
230,910
21,543
2,365
2,875
240
27,023
2,998
50,000
2,255
55,253
82,276
7,609
24,603
11,431
1,068
37
1,840
46,588
43,496
-
128,145
171,641
218,229
16,770
-
715
909
18,394
1
55,000
2,155
57,156
75,550
148,634
142,679
304,587
16,732
(170,665)
50
(2,070)
148,634
302,746
9,559
(170,665)
785
254
142,679
The above Statement of Financial Position should be read in conjunction with the accompanying notes.
AnnUAL RePoRt 2016
16
Metro PerforMance Glass liMited
ConsoliDAteD stAteMent of ChAnges in equity
for the period ended 31 March
CONSOlIDATED
2016
Contributed
equity
Reserves
Retained
earnings
Total
Notes
$’000
$’000
$’000
$’000
Opening balance at 1 April 2015
302,746
(169,626)
Profit for the period
Other comprehensive income for the period
Total comprehensive income for the period
Dividends paid
-
-
-
-
Payments received on management incentive
plan shares
5.2
944
Transfer share based payments reserve to
equity
5.2
897
Movement in share based payments reserve
-
-
(2,324)
(2,324)
-
-
(897)
162
9,559
20,495
-
20,495
142,679
20,495
(2,324)
18,171
(13,322)
(13,322)
-
-
-
944
-
162
Total transactions with owners, recognised
directly in equity
1,841
(735)
(13,322)
(12,216)
Balance at 31 March 2016
304,587
(172,685)
16,732
148,634
The above statement of changes in equity should be read in conjunction with the accompanying notes.
17
Metro PerforMance Glass liMited
ConsoliDAteD stAteMent of ChAnges in equity
for the period ended 31 March
CONSOlIDATED
2015
Contributed
equity
Reserves
Retained
earnings
Total
Notes
$’000
$’000
$’000
$’000
Opening balance at 30 May 2014
Profit for the period
Other comprehensive income for the period
Total comprehensive income for the period
Issue of share capital - Initial public offering
Issue of share capital - Acquisition of
Metroglass Holdings Limited
IPO expenses included in contributed equity
Contributions to shares issued to key
management employees
Acquired upon group reorganisation
Transfer share based payments reserve to
equity
Movement in share based payments reserve
-
-
-
-
244,236
62,300
(7,045)
2,750
-
505
-
-
-
1,122
1,122
-
-
-
-
(170,471)
(505)
228
Total transactions with owners, recognised
directly in equity
302,746
(170,748)
-
9,559
-
9,559
-
-
-
-
-
-
-
-
-
9,559
1,122
10,681
244,236
62,300
(7,045)
2,750
(170,471)
-
228
131,998
Balance at 31 March 2015
302,746
(169,626)
9,559
142,679
AnnUAL RePoRt 2016
18
Metro PerforMance Glass liMited
ConsoliDAteD stAteMent of CAsh flows
for the period ended 31 March
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Interest paid
Income taxes paid
Net cash inflow from operating activities
Cash flows from investing activities
Payments for property, plant & equipment
Payments for intangible assets
Acquisition of Metroglass Holdings Limited (net of cash acquired)
Net cash outflow from investing activities
Cash flows from financing activities
Repayment of borrowings
Drawdown of borrowings
Ordinary shares issued
Payments received on management incentive plan shares
IPO expenses included in contributed equity
IPO expenses included in statement of comprehensive income
Dividend paid
Net cash inflow/outflow from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the period
Cash and cash equivalents at end of the period
12 Months
Consolidated
8 Months
Consolidated
2016
Notes
$’000
2015
$’000
187,530
(154,048)
210
(3,215)
(2,872)
27,605
(9,589)
(1,843)
-
(11,432)
(5,000)
-
-
944
-
-
(13,322)
(17,378)
(1,205)
7,609
6,404
112,712
(82,833)
50
(1,722)
(5,201)
23,006
(17,847)
(2,615)
(219,096)
(239,558)
(64,000)
55,000
244,236
-
(7,045)
(4,030)
-
224,161
7,609
-
7,609
The above Statement of Changes in Cash Flows should be read in conjunction with the accompanying notes.
19
Metro PerforMance Glass liMited
ConsoliDAteD stAteMent of CAsh flows (ContinueD)
for the period ended 31 March
12 Months
Consolidated
2016
8 Months
Consolidated
2015
$’000
$’000
Reconciliation of profit after income tax to net inflow from operating activities
Profit for the period
20,495
9,559
Items not involving cash flows
Depreciation expense
Amortisation of intangible assets
Share based payments expense
Movement in deferred tax
Movement in doubtful debt provision
Impact of changes in working capital items
Accounts receivable and other assets
Inventory
Trade creditors & employee entitlements
Interest accruals
Warranty provision
Onerous lease provision
Lease incentive provision
Goods & services tax (GST) payable
Income tax liability
Items classified as investing or financing activities
Surplus on disposal of assets
IPO expenses included in statement of comprehensive income
5,176
2,245
162
795
(640)
7,738
(618)
(6,224)
3,386
165
(300)
(504)
235
314
3,005
(541)
(87)
-
(87)
2,632
1,119
228
752
65
4,796
8,388
(3,298)
(281)
418
-
(2,450)
2,155
223
(526)
4,629
(8)
4,030
4,022
Net cash flow from operating activities
27,605
23,006
AnnUAL RePoRt 2016
20
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents
Metro Performance Glass is pleased
to present a new structure for our
audited financial statements.
The new structure has been designed to
make the financial statements less complex
and more readable for our shareholders and
other stakeholders. The disclosures have been
grouped under the following four sections:
Performance
Working Capital
Long Term Assets
Debt & Equity
Other
Each section sets out the accounting policies
applied in producing the notes to these
financial statements, along with details of any
key judgements and estimates used. Other
accounting policies are included in Note 1.
1. BASIS OF PREPARATION
Reporting entity
These financial statements are for Metro
Performance Glass Limited (‘the Company’)
and its subsidiaries (together, ‘the Group’).
The Group supplies processed flat glass
and related products primarily to the
residential and commercial building sectors.
The Company is a profit oriented entity
for financial reporting purposes and has
operations and sales in New Zealand.
Statutory base
The Company is a limited liability company
incorporated and domiciled in New Zealand.
The address of its registered office is 5
Lady Fisher Place, East Tamaki, Auckland.
The incorporation date for Metro
Performance Glass Limited was 30 May
2014 and as part of a group reorganisation
was listed on the New Zealand Securities
Exchange (NZX) on 29 July 2014.
The comparative trading results presented
encompass the eight month period from
listing date to 31 March 2015. No material
transactions occurred in the period between the
Company’s incorporation and the acquisition of
Metroglass Holdings Limited on 29 July 2014.
Basis of preparation
These consolidated financial statements
have been approved for issue by the
Board of Directors on 26 May 2016.
The consolidated financial statements of the
Group have been prepared in accordance
with Generally Accepted Accounting Practice
in New Zealand (‘NZGAAP’). They comply with
New Zealand equivalents to International
Financial Reporting Standards (‘NZ IFRS’)
and other applicable Financial Reporting
Standards, as applicable for profit-
oriented entities. The consolidated financial
statements also comply with International
Financial Reporting Standards (‘IFRS’).
Metro Performance Glass Limited is a limited
liability company registered under the New
Zealand Companies Act 1993 and is a Financial
Market Conduct reporting entity under Part 7
of the Financial Market Conduct Act 2013. The
financial statements of the Group have been
prepared in accordance with the requirements
of Part 7 of the Financial Markets Conduct Act
2013 and the NZX Main Board Listing Rules.
In accordance with the Financial Markets
Conduct Act 2013, because group financial
statements are prepared and presented for
Metro Performance Glass Limited and its
subsidiaries, separate financial statements
for Metro Performance Glass Limited are
no longer prepared and presented.
21
Metro PerforMance Glass liMited notes to the finAnCiAl stAteMents (Cont’D)
Historical cost convention
The financial statements have been prepared
under the historical cost convention, as
modified by the revaluation of financial
assets and financial liabilities measured
at fair value through profit or loss.
Principles of consolidation
The financial statements incorporate the
assets and liabilities of all subsidiaries
of Metro Performance Glass Limited
(‘the company’ or ‘the parent entity’) as
at 31 March 2016 and the results of all
subsidiaries for the period then ended.
Subsidiaries are all entities over which the
Group has control. 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 Group companies are eliminated.
Unrealised losses are also eliminated unless
the transaction provides evidence of the
impairment of the asset transferred.
FOREIGN CuRRENCy TRANSlATION
Functional and presentation currency
The consolidated financial statements are
presented in New Zealand dollars, which
is Metro Performance Glass Limited’s
functional and presentation currency.
Transactions and balances
Foreign currency transactions are translated
using the exchange rates prevailing at the
dates of the transactions. Foreign exchange
gains and losses resulting from the settlement
of such transactions and from the translation
at period end exchange rates of monetary
assets and liabilities denominated in foreign
currencies are recognised in profit and loss.
Monetary assets and liabilities arising from
transactions or overseas borrowings that
remain at balance date are translated at
period end closing rates at 31 March 2016.
Goods and Services Tax (GST)
The statement of comprehensive income
has been prepared so that all components
are stated exclusively of GST. All items in the
statement of financial position are stated
net of GST, with the exception of receivables
and payables, which include GST invoiced.
CHANGES IN ACCOuNTING POlICy
AND DISClOSuRES
New and amended standards
adopted by the Group
There are no significant impacts from the
adoption of any new standards or amendments
by the Group during the period. The adoption of
NZ IFRS 15 ‘Revenue’ and NZ IRFS 9 ‘Financial
Instruments’ will be mandatory from periods
beginning on or after 01 January 2018. These
are not expected to have a significant impact
on the Group’s financial statements.
Critical accounting estimates and judgements
Estimates and judgements are continually
evaluated and are based on historical experience
and other factors, including expectations
of future events that are believed to be
reasonable under the circumstances.
The Group makes estimates and assumptions
concerning the future. The resulting accounting
estimates will, by definition, seldom equal
the related actual results. The estimates
and assumptions that have a significant
risk of causing a material adjustment to the
carrying amounts of assets and liabilities
within the next financial year are discussed
in each accounting note as appropriate.
AnnUAL RePoRt 2016
22
Metro PerforMance Glass liMited notes to the finAnCiAl stAteMents (Cont’D)
Sales of goods
The Group operates a network of processing
and retail branches for the provision and
assembly of customized glass products across
New Zealand. Sales of goods are recognised
when a Group entity has delivered glass
products to the customer, the customer has
accepted the products and collectability of the
related receivables is reasonably assured.
Sales of services
The Group provides nationwide glazing services
throughout the Metro Performance Glass
branch network. For sales of glazing services,
revenue is recognised in the accounting
period in which the services are rendered,
by reference to stage of completion of the
specific transaction and assessed on the basis
of the actual service provided as a proportion
of the total services to be provided.
2. FINANCIAl PERFORMANCE
2.1 Segment information
Operating segments of the Group at 31 March
2016 have been determined based on financial
information that is regularly reviewed by the
Board in conjunction with the Chief Executive
Officer and Chief Financial Officer, collectively
known as the Chief Operating Decision Maker for
the purpose of allocating resources, assessing
performance and making strategic decisions.
Substantially all of the Group’s revenue is
derived from the sale of glass and related
products and services. All revenue from
external customers is attributed to sales
in New Zealand. All non-current assets
(excluding financial instruments and deferred
tax assets) are located in New Zealand.
2.2 Revenue
Accounting policy
Revenue comprises the value of the
consideration received for the sale of goods
and services, net of value-added tax (including
Goods and Services Tax), rebates and discounts
and after eliminating sales within the Group.
23
Metro PerforMance Glass liMited notes to the finAnCiAl stAteMents (Cont’D)
2.3 Operating expenditure
Raw material and consumables used
Employee benefit expense
Subcontractor cost
Depreciation and amortisation
Transportation and logistics
Operating lease payments
Advertising
IPO expenses
Other expenses
12 Months
Consolidated
2016
8 Months
Consolidated
2015
$’000
$’000
48,689
61,589
6,433
7,334
7,857
6,832
2,123
-
17,056
29,003
36,225
4,013
3,751
4,821
3,955
618
4,030
11,506
Total cost of sales, distribution and glazing related expenses, selling and
marketing expenses, and administration expenses
157,913
97,922
Audit and review of financial statements
Audit and review of financial statements - PwC
Other services performed by PwC
Tax compliance and advice
IPO investment statement and prospectus assurance services
Executive reward services
12 Months
Consolidated
2016
8 Months
Consolidated
2015
$’000
$’000
206
215
11
-
50
267
32
793
-
1,040
AnnUAL RePoRt 2016
24
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
2.4 Earnings per share
Basic
Basic earnings per share is calculated by
dividing the profit after tax of the Group by
the weighted average number of ordinary
shares outstanding during the period.
12 Months
Consolidated
2016
8 Months
Consolidated
2015
$’000
$’000
Profit after tax ($'000)
Weighted average number of ordinary shares outstanding ('000s)
Basic Earnings per share (cents per share)
20,495
185,030
11.1
9,559
180,315
5.3
Diluted
Diluted Earnings per share is calculated
by adjusting the weighted average
number of ordinary shares outstanding
to assume conversion of all dilutive
potential ordinary shares.
12 Months
Consolidated
2016
8 Months
Consolidated
2015
$’000
$’000
Weighted average number of ordinary shares outstanding ('000s)
185,030
Adjusted for share options ('000s)
311
180,315
4,715
Weighted average number of ordinary shares for diluted earnings per
share ('000s)
185,852
185,030
Diluted Earnings per share (cents per share)
11.1
5.2
3. WORkING CAPITAl
3.1 Trade and other receivables
Trade receivables
Provision for doubtful trade receivables
Consolidated
2016
Consolidated
2015
$’000
$’000
27,512
(1,654)
25,858
26,897
(2,294)
24,603
25
Metro PerforMance Glass liMited notes to the finAnCiAl stAteMents (Cont’D)
(a) Bad and doubtful trade receivables
The Group extends credit to its customers
based on an assessment of credit worthiness.
Terms differ by customer and may extend
to 60 days past invoice date. A portion of
the Group’s receivables are also subject to
contractual retentions which can last up
to and exceed 12 months. At balance date,
a portion of trade receivables are past due
as defined by the applicable credit terms.
The aging profile of debtors follows:
Current
30 - 59 days
60 - 89 days
90 days and later
Consolidated
2016
Consolidated
2015
$’000
$’000
18,606
3,448
611
4,847
27,512
16,484
4,168
1,392
4,853
26,897
The aging profile above does not necessarily
reflect whether an amount is past due and
impaired as customer credit terms vary and
a significant amount of the aged receivable
is subject to contractual retentions.
Movements in the provision for impairment of receivables are as follows:
Opening balance
Acquisition of subsidiary
Provision for impairment recognised/(released) during the year
Receivables written off during the year as uncollectible
Consolidated
2016
Consolidated
2015
$’000
$’000
2,294
-
169
(809)
1,654
-
2,229
639
(574)
2,294
AnnUAL RePoRt 2016
26
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
Amounts are generally written off when
there is no expectation of recovering
additional cash or other consideration.
The aging profile of debtors 'past due but not impaired' is as follows:
Current
30 - 59 days
60 - 89 days
90 days and later
Consolidated
2016
Consolidated
2015
$’000
$’000
-
-
478
3,326
3,804
-
-
1,392
2,559
3,951
Estimates and judgements:
Allowance for doubtful debts
Receivables are reduced by an allowance
for amounts that may become uncollectible
in the future. Collections and payments
from our customers are continuously
monitored and a provision for doubtful debts
is maintained based upon our historical
experience and any specific customer
collection issues that we have identified.
Accounting policy
Trade receivables are recognised initially
at fair value and subsequently measured
at amortised cost, less provision for
estimated uncollectable amounts.
The carrying amount of the asset is reduced
through the use of an allowance account, and
the amount of the loss is recognised in the
statement of comprehensive income within
‘Administration expenses’. Individual debtor
accounts are reviewed for impairment and a
provision is raised based on management’s
best estimate of recoverability.
Credit risk
Credit risk arises from cash and cash equivalents,
derivative financial instruments and deposits with
banks and financial institutions, as well as credit
exposures to wholesale and retail customers,
including outstanding receivables and committed
transactions and is managed at Group level.
3.2 Inventories
Raw materials, primarily flat glass stock-sheets
Work in progress
Consolidated
2016
Consolidated
2015
$’000
$’000
15,308
2,347
17,655
10,011
1,420
11,431
The cost of inventories recognised as an expense and included in ‘cost of sales’ amounted to $53m.
27
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
Accounting policy
Raw materials and stock, work in progress and
finished goods are stated at the lower of cost
and net realisable value. Cost comprises direct
materials, direct labour and an appropriate
proportion of variable and fixed overhead
expenditure, the latter being allocated on
the basis of normal operating capacity. Costs
are assigned to individual items of inventory
on the basis of weighted average costs.
Net realisable value is the estimated selling
price in the ordinary course of business less
the estimated costs of completion and the
estimated costs necessary to make the sale.
3.3 Trade and other payables
Trade accounts payable
Employee entitlements
Goods and services tax payable
Other interest accruals
Management incentive accrual
Consolidated
2016
Consolidated
2015
$’000
$’000
15,071
3,856
1,032
396
1,188
21,543
10,907
3,940
718
231
974
16,770
Trade and other payables
These amounts represent liabilities for
goods and services provided to the Group
prior to the end of financial period which are
unpaid. The carrying amount represents
fair value due to their short term nature.
Employee benefits
Liabilities for wages and salaries, including non-
monetary benefits, annual leave and lieu leave
are recognised in ‘Trade and other payables’
in respect of employees’ services up to the
reporting date and are measured at the
amounts expected to be paid when the liabilities
are settled. Liabilities for non-accumulating sick
leave are recognised when the leave is taken
and measured at the rates paid or payable.
The Group recognises a liability and an
expense for bonuses on a formula that takes
into consideration the profit attributable
to the Group’s shareholders. The Group
recognises a provision where contractually
obliged or where there is a past practice
that has created a constructive obligation.
AnnUAL RePoRt 2016
28
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
The fair value of financial instruments
traded in active markets by the Group is
based on the current bid price and for
financial liabilities is the current ask price.
At 31 March 2016 all financial instruments
measured at fair value (interest rate swaps
and forward exchange contracts) were valued
using valuation techniques where all significant
inputs were based on observable market data.
Accordingly they are categorised as level 2.
Specific valuation techniques used to value the
Group’s financial instruments are as follows:
• The fair value of forward foreign
exchange contracts is determined using
forward exchange rates at the balance
sheet date, with the resulting value
discounted back to present value.
• The fair value of interest rate swap
contracts is determined using
forward interest rates at the balance
sheet date, with the resulting value
discounted back to present value.
These fair values are based on valuations provided
by the ANZ Banking Group as at 31 March 2016.
3.4 Financial instruments
The Group’s activities expose it to a variety of
financial risks: market risk (including currency risk,
fair value interest rate risk, cash flow interest
rate risk and price risk), credit risk and liquidity
risk. The Group’s overall financial risk management
is carried out by a central finance function (the
head office finance team) under policies approved
by the board of directors. The head office
finance team focuses on the unpredictability
of financial markets and identifies, evaluates
and seeks to hedge financial risks in close
co-operation with the Group’s operating
units to minimise potential adverse effects
on the financial performance of the Group.
The board approves policies covering foreign
exchange risk, interest rate risk and credit risk.
The Group uses derivative financial instruments
such as foreign exchange contracts and interest
rate swaps to hedge certain risk exposures.
The Group uses different methods including
sensitivity analysis in the case of interest rate,
foreign exchange and other price risks and
aging analysis for credit risk to measure risk.
Derivatives
The Group holds derivative financial
instruments to hedge its foreign currency.
The Group has designated forward exchange
contracts as cash flow hedge instruments.
Cash flow hedges - forward exchange
contracts and interest rate swaps
Cash flow hedge instruments hedge the exposure
to variability in cash flows that (i) is attributable
to a particular risk associated with a recognised
asset or liability or a highly probable forecast
transaction and (ii) could affect profit or loss.
29
Metro PerforMance Glass liMited notes to the finAnCiAl stAteMents (Cont’D)
Financial Instruments by category
Assets as per statement of financial position
31 March 2016
Cash and cash equivalents
Derivatives - foreign exchange contracts
Derivatives - interest rate swaps
Trade and other receivables
Balance at 31 March 2016
31 March 2015
Cash and cash equivalents
Derivatives - foreign exchange contracts
Trade and other receivables
Balance at 31 March 2015
CONSOlIDATED
loans and
receivables
Total
Derivatives
used for
hedging
Notes
$'000
$'000
$'000
6,404
-
-
25,858
32,262
7,609
-
24,603
32,212
-
-
-
-
-
-
1,068
-
1,068
6,404
-
-
25,858
32,262
7,609
1,068
24,603
33,280
CONSOlIDATED
liabilities at
amortised
cost
Derivatives
used for
hedging
Total
$'000
$'000
$'000
liabilities as per statement of financial position
31 March 2016
Trade and other payables excluding non-financial liabilities
20,008
Derivatives - foreign exchange contracts
Derivatives - interest rate swaps
Interest bearing liabilities
Balance at 31 March 2016
31 March 2015
Trade and other payables excluding non-financial liabilities
Derivatives - interest rate swaps
Interest bearing liabilities
Balance at 31 March 2015
-
-
50,000
70,008
11,138
-
55,000
66,138
-
1,575
1,300
-
2,875
-
715
-
715
20,008
1,575
1,300
50,000
72,883
11,138
715
55,000
66,853
AnnUAL RePoRt 2016
30
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
Accounting policy
On initial designation of a derivative as a
cash flow hedging instrument, the Group
formally documents the relationship between
the hedging instrument and hedged item,
including the risk management objectives and
strategy in undertaking the hedge transaction.
Documentation includes the nature of the risk
being hedged, together with the methods that
will be used to assess the hedging instrument’s
effectiveness. The Group also documents its
assessment, both at the inception of the hedge
relationship as well as on an ongoing basis, of
whether the hedging instruments are expected
to be highly effective in offsetting the changes
in cash flows of the respective hedged items.
The effective portion of changes in the fair
value of derivatives that are designated and
qualify as cash flow hedges, is recognised in
other comprehensive income and presented in
the hedging reserve in equity. The gain or loss
relating to the ineffective portion is recognised
immediately in the profit or loss section of
the statement of comprehensive income.
Foreign exchange risk
Foreign exchange risk arises when future
commercial transactions and purchases
of recognised assets are denominated in
a currency that is not NZD which is the
company’s functional currency. Approximately
95% of annual flat sheet glass raw materials
are purchased in foreign currencies, being
United States Dollar (USD), Euro (EUR) and
Australian Dollar (AUD). In accordance with the
Company Treasury policy, foreign exchange risk
is managed prospectively out over a period of
12 months with allowable limits of coverage
up to 100% over the 12 month term. Where
deemed acceptable by the directors, coverage
can be extended out over a longer period.
Exposure to foreign exchange risk
Consolidated
AuD
uSD
EuR
Notes
NZ$'000
NZ$'000
NZ$'000
31 March 2016
Cash and cash equivalents
Trade receivables
Trade accounts payable
Balance at 31 March 2016
31 March 2015
Cash and cash equivalents
Trade receivables
Trade accounts payable
Balance at 31 March 2015
64
21
(137)
(52)
27
36
(56)
7
-
-
(3,181)
(3,181)
1
-
(681)
(680)
-
-
(985)
(985)
-
-
(181)
(181)
Cash flow hedge reserve movement shown
in the statement of comprehensive income
reflects the tax affected change in fair
value of forward foreign exchange currency
contracts during the reporting period.
31
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
Sensitivity analysis
The following table details the Group’s
sensitivity to a 10% strengthening/weakening
of the New Zealand dollar (NZD) against the
following currencies at the reporting date.
The table shows the (decrease)/increase in
profit or loss and equity as a result of the
10% movements. The analysis assumes that
all other variables, in particular interest
rates, remain constant. The same basis has
been applied for all periods presented.
Profit or loss
10% strengthening of the NZD against:
AUD
USD
EUR
10% weakening of the NZD against:
AUD
USD
EUR
Equity
10% strengthening of the NZD against:
USD
EUR
10% weakening of the NZD against:
USD
EUR
Consolidated
2016
Consolidated
2015
NZ$'000
NZ$'000
5
289
90
(6)
(353)
(109)
(1)
62
17
1
(76)
(20)
Consolidated
2016
Consolidated
2015
NZ$'000
NZ$'000
(3,168)
(613)
3,872
750
(2,305)
(242)
2,817
295
Profit or loss movements are mainly attributable
to the exposure outstanding on USD trade
payables at the end of the reporting period.
Equity movements are the result of changes in
fair value of derivative instruments designated
as hedging instruments in cash flow hedges.
Commodity cost risk
The primary raw material used by the
Group is flat glass which is imported from
suppliers around the world. While there
are numerous manufacturers of flat sheet
glass, the Group is exposed to commodity
price risk and therefore manages access
to supply through close relationships with
suppliers. Cost is an important variable in the
determination of supply, and the Group is clearly
exposed to changes in the cost of glass.
AnnUAL RePoRt 2016
32
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
4. lONG TERM ASSETS
4.1 Property, plant and equipment
CONSOlIDATED 2016
Opening balance
Cost
Accumulated depreciation
Net book value at 1 April 2015
Additions
Disposals
Depreciation expense
Closing net book value at 31 March 2016
Represented by:
Cost
Accumulated depreciation
Net book value at 31 March 2016
Plant &
equipment
Furniture,
fittings &
equipment
Motor
vehicles
Total
Notes
$'000
$'000
$'000
$'000
38,411
(1,880)
36,531
7,332
-
(3,700)
40,163
46,864
(6,701)
40,163
1,676
(189)
1,487
434
(7)
(423)
1,491
2,193
(702)
1,491
6,041
(563)
5,478
1,967
(49)
(1,053)
6,343
8,058
(1,715)
6,343
46,128
(2,632)
43,496
9,733
(56)
(5,176)
47,997
57,115
(9,118)
47,997
CONSOlIDATED 2015
Plant &
equipment
Furniture,
fittings &
equipment
Motor
vehicles
Total
Notes
$'000
$'000
$'000
$'000
Opening balance at 30 May 2014
Cost
Accumulated depreciation
Net book value at 30 May 2014
Acquired upon group reorganisation
Additions
Disposals
Depreciation expense
Closing net book value at 31 March 2015
Represented by:
Cost
Accumulated depreciation
Net book value at 31 March 2015
-
-
-
21,939
16,472
-
(1,880)
36,531
38,411
(1,880)
36,531
-
-
-
877
799
-
(189)
1,487
1,676
(189)
1,487
-
-
-
5,457
584
-
(563)
5,478
6,041
(563)
5,478
-
-
-
28,273
17,855
-
(2,632)
43,496
46,128
(2,632)
43,496
33
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
Estimates and judgements: Economic
lives of intangible assets and
property, plant and equipment
Property, plant and equipment are
long-lived assets that are amortised/
depreciated over their useful lives.
Accounting policy
All property, plant and equipment is stated
at historical cost less depreciation and
impairment. Historical cost includes
expenditure that is directly attributable
to the acquisition of the items.
Land is not depreciated. Depreciation of
property, plant and equipment is calculated
using the straight line value method to
allocate the cost of the assets over their
useful lives. The rates are as follows:
Category
Leasehold improvements
Plant & equipment
Motor vehicles
Furniture, fixtures and fittings
Depreciation
rate
Depreciation
basis
7.5-15%
7.5-15%
12-20%
20-25%
SL
SL
SL
SL
The assets’ residual values and useful lives
are reviewed, and adjusted if appropriate, at
each statement of financial position date.
Capital work in progress is not
depreciated until commissioned.
AnnUAL RePoRt 2016
34
Metro PerforMance Glass liMited notes to the finAnCiAl stAteMents (Cont’D)
4.2 Intangible assets
CONSOlIDATED 2016
Customer
relationships
Goodwill on
acquisitions
Computer
software
Total
Notes
$'000
$'000
$'000
$'000
Opening balance
Cost
Accumulated amortisation
Net book value at 1 April 2015
Additions
Disposals
Amortisation expense
Closing net book value at 31 March 2016
Represented by:
Cost
Accumulated amortisation
Net book value at 31 March 2016
10,875
(967)
9,908
-
-
(1,450)
8,458
10,875
(2,417)
8,458
115,489
-
115,489
900
-
-
2,900
(152)
2,748
945
(2)
(794)
116,389
2,896
116,389
-
116,389
3,868
(972)
2,896
129,264
(1,119)
128,145
1,845
(2)
(2,244)
127,743
131,132
(3,389)
127,743
CONSOlIDATED 2015
Customer
relationships
Goodwill on
acquisitions
Computer
software
Total
Notes
$'000
$'000
$'000
$'000
Opening balance at 30 May 2014
Cost
Accumulated amortisation
Net book value at 30 May 2014
Acquired upon group reorganisation
Additions
Amortisation expense
Closing net book value at 31 March 2015
Represented by:
Cost
Accumulated amortisation
Net book value at 31 March 2015
-
-
0
10,875
-
(967)
9,908
10,875
(967)
9,908
-
-
0
115,489
-
-
115,489
115,489
-
115,489
-
-
0
285
2,615
(152)
2,748
2,900
(152)
2,748
-
-
0
126,649
2,615
(1,119)
128,145
129,264
(1,119)
128,145
35
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
Estimates and judgements: Goodwill
The Group tests not less than annually
whether goodwill has suffered any
impairment. The recoverable amounts of
cash-generating units have been determined
based on value-in-use calculations. These
calculations require the use of estimates.
Impairment tests for goodwill
On acquisition goodwill was allocated to three
cash generating units being upper North
Island, lower North Island and the South
Island. Goodwill is allocated as follows:
Upper North Island
Lower North Island
South Island
Consolidated
2016
Consolidated
2015
49,429
23,445
43,515
49,429
23,445
42,615
116,389
115,489
This calculation uses pre-tax cash flow
projections based on financial budgets
approved by management covering a
five-year period. Cash flows beyond the
five-year period are extrapolated using
estimated long term growth rates. Key
assumptions used based on management’s
knowledge of the market are as follows:
Compound annual volume growth - 5 years
Long term growth rate
Discount rate
Sensitivity analyses performed by management
indicate no impairment through reasonable
changes to the above assumptions.
Consolidated
2016
Consolidated
2015
4.0%
2.2%
9.5%
10.0%
2.5%
10.0%
AnnUAL RePoRt 2016
36
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
Accounting policy
Goodwill
Goodwill represents the excess of the
consideration paid for an acquisition over
the fair value of the Group’s share of the net
identifiable assets of the acquired subsidiary
at the date of acquisition. Any goodwill arising
on acquisitions of subsidiaries is included in
intangible assets. Goodwill acquired in business
combinations is not amortised. Instead, goodwill
is tested for impairment annually, or more
frequently if events or changes in circumstances
indicate that it might be impaired, and is
carried at cost less accumulated impairment
losses. Gains and losses on the disposal
of an entity include the carrying amount
of goodwill relating to the entity sold.
The carrying value of goodwill is compared to the
recoverable amount, which is the higher of value
in use and the fair value less costs of disposal.
Any impairment is recognised immediately as
an expense and is not subsequently reversed.
For the purposes of impairment testing,
goodwill acquired in a business combination is
allocated to each of the cash generating units
that is expected to benefit from the synergies
of the combination. Each unit to which the
goodwill is allocated represents the lowest
level within the entity at which the goodwill is
monitored for internal management purposes.
computer software
Acquired computer software licences are
capitalised on the basis of the costs incurred
to acquire and bring to use the specific
software. Costs that are directly associated
with the production of identifiable and unique
software products controlled by the Group
are recognised as intangible assets when
management intends to use the software and it
will generate probable future economic benefits.
Directly attributable costs that are capitalised
as part of the software product include the
software development employee costs and an
appropriate portion of relevant overheads.
Amortisation of computer software
is calculated on a straight line basis
over a useful life of 4 years.
contractual customer relationships
Contractual customer relationships acquired
in a business combination are recognised
at fair value at the acquisition date. The
contractual customer relations acquired are
estimated to have a finite useful life and are
carried at cost less accumulated amortisation.
Amortisation is calculated on a straight-
line method over the expected life, being
10 years, of the customer relationship.
37
Metro PerforMance Glass liMited notes to the finAnCiAl stAteMents (Cont’D)
5. DEBT & EquITy
5.1 Interest bearing liabilities
Bank Borrowings
Bank borrowings are secured by the property,
plant and equipment of the Group. The Group’s
bank borrowing facilities comprise a $60m term
loan facility and a $15m cash drawdown facility,
both of which are due for repayment on 29 July
2017 and bear a variable interest rate which is
currently 3.65% per annum. The Group complied
with all covenants throughout the year.
(a) Assets pledged as security
The bank loans are secured under both a General
Security Deed and Specific Security Deed which
results in registered charges over assets of
the Group. In addition there are positive and
negative pledge undertakings by the Company.
(b) Fair value
The carrying value of the Group’s bank
borrowings also represents the fair value
of the borrowings due to management’s
assessment that the interest rates approximate
the market interest rate for a commercial
loan of a comparable lending period.
Accounting policy
Borrowings are initially recognised at fair value,
net of transaction costs incurred. Borrowings
are subsequently measured at amortised cost.
Consolidated
2016
Consolidated
2015
$'000
$'000
50,000
50,000
55,000
55,000
Any difference between the proceeds (net of
transaction costs) and the redemption amount
is expensed in the statement of comprehensive
income over the period of the borrowings
using the effective interest method.
Borrowings are classified as current
liabilities unless the Group has an
unconditional right to defer settlement of
the liability for at least 12 months after
the statement of financial position date.
liquidity risk
Prudent liquidity risk management implies
maintaining sufficient cash and marketable
securities, the availability of funding through an
adequate amount of committed credit facilities
and the ability to close-out market positions.
In addition to cash reserves, the Group has
negotiated a multi-option credit facility with its
banking partners. As at 31 March 2016 the Group
had cash of $6.4 million. Information in respect
of negotiated credit facilities is shown below.
Committed credit facilities pursuant to the multi-option facility
Drawdown at balance date
Available credit facilities
Consolidated
2016
Consolidated
2015
75,000
75,000
(54,540)
20,460
(59,841)
15,159
AnnUAL RePoRt 2016
38
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
The table below analyses both of the Group’s
non-derivative financial liabilities and derivative
financial liabilities into relevant maturity groupings
based on the remaining period at the balance
sheet date to the contractual maturity date.
Derivative financial liabilities are included in
the analysis if their contractual maturities are
essential for an understanding of cash flows.
less than
1 year
Between 1
and 2 years
Between 2
and 5 years
> 5 years
Total
CONSOlIDATED
Notes
$'000
$'000
$'000
$'000
$'000
Bank borrowings and interest owing
Interest rate swap
Foreign exchange contracts
Trade accounts payable
Total at 31 March 2016
Bank borrowings and interest owing
Interest rate swap
Trade accounts payable
Total at 31 March 2015
396
389
1,538
15,071
17,394
3,002
223
10,907
14,132
50,000
911
37
-
50,948
2,771
215
-
2,986
-
-
-
-
-
55,924
277
-
56,201
-
-
-
-
-
-
-
-
-
50,396
1,300
1,575
15,071
68,342
61,697
715
10,907
73,319
Interest rate risk
As the Group has no significant interest bearing
assets, the Group’s income and operating cash flows
are not substantially impacted by changes in market
interest rates on interest bearing financial assets.
Cash flow risk
The Group’s interest rate risk arises from
borrowings. Borrowings issued at variable rates
expose the Group to cash flow interest rate risk.
During the period the Group’s borrowings at variable
rates were denominated in New Zealand dollars.
The Group adopts a policy of ensuring that
its exposure to changes in interest rates
on borrowings is on a fixed-rate basis by
entering into interest rate swaps.
5.2 Contributed equity
Opening balance
Issue of share capital - Initial public offering
Issue of share capital - Acquisition of
Metroglass Holdings Limited
IPO expenses included in contributed equity
Contributions to shares issued to
key management employees
Share based payments reserve transferred to equity
Payments received on management incentive plan shares
Consolidated
2016
Consolidated
2015
$'000
$'000
302,746
-
-
-
-
-
897
944
244,236
62,300
(7,045)
2,750
505
-
Closing balance
304,587
302,746
39
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
The performance rights enable participants
to acquire shares in Metro Glass with no
consideration payable, subject to Metro
Glass achieving set performance hurdles
and meeting certain vesting conditions.
The share options enable participants to
acquire shares in Metro Glass at a market
based exercise price, subject to Metro
Glass achieving set performance hurdles
and meeting certain vesting conditions.
In the event that the respective performance
hurdles are not met on the measurement
date, retesting will be permitted after
a further six and twelve months.
A total of 822,159 share options with an
exercise price of $1.60 and 120,791 performance
share rights have been issued under the
initial grants pursuant to the plan.
Accounting policy
Ordinary shares are classified as equity.
Incremental costs directly attributable
to the issue of new shares or acquiring
its own shares are shown in equity as a
deduction, net of tax, from the proceeds.
dividends
Provision is made for the amount of any dividend
declared on or before the end of the financial
year but not distributed at balance date.
Dividend distribution to the Group shareholders
is recognised as a liability in the Group’s
financial statements in the period in which
the dividends are declared by the Board.
On 29 July 2014, Metro Performance Glass
Limited received gross proceeds of $244.2
million from the allotment of 143,668,486
ordinary shares at an issue price of $1.70 per
share, offered under the Investment Statement
and Prospectus dated 7 July 2014 (amended
15 July 2014) for the Initial Public Offering
(IPO) of ordinary shares in Metro Performance
Glass Limited. Additionally 36,646,730 ordinary
shares were issued in exchange for 113,811,147
shares in Metroglass Holdings Limited at an
issue price of $1.70 per share. As part of the
then long term incentive plan 4,714,784 ordinary
shares were issued with no value in contributed
equity until they vested on 29 July 2015.
At balance date, there were 185,030,000
ordinary shares outstanding.
Additional movements to contributed
equity include a decrease of $7.0 million
from IPO expenses and an increase of $3.3
million from contributions to shares issued
to key management employees of cash
and share based payments reserves.
Payments received on management incentive
plan shares relates to net proceeds received
on the sale of shares forfeited by a key
management employee on leaving the business.
long Term Incentive Plan
The Group currently has a long term incentive
plan for selected employees. The plan
participants for the current financial year are
part of the company’s senior management.
The plan is designed to secure those employees’
retention in Metro Glass and to reward
performance that underpins the achievement of
Metro Glass’ business strategy and long term
shareholder wealth creation. Participants are
offered an annual award of a specified number
of both performance rights and share options in
Metro Glass (in accordance with the plan rules).
AnnUAL RePoRt 2016
40
Metro PerforMance Glass liMited notes to the finAnCiAl stAteMents (Cont’D)
CAPITAl RISk MANAGEMENT
The Group and the parent entity’s objectives
when managing capital are to safeguard
their ability to continue as a going concern,
so that they can continue to provide returns
for shareholders and benefits for other
stakeholders and to maintain an optimal capital
structure to reduce the cost of capital.
In order to maintain or adjust the capital
structure, the Group may adjust the
amount of dividends paid to shareholders,
return capital to shareholders, issue new
shares or sell assets to reduce debt.
The Group monitors capital on the basis
of the gearing ratio. The Group gearing
ratio at 31 March 2016 was as follows:
Bank borrowings
Less: cash and cash equivalents
Net debt
Equity
Gearing ratio
6. OTHER
6.1 Income taxation
Consolidated
2016
Consolidated
2015
$'000
$'000
50,000
6,404
43,596
55,000
7,609
47,391
148,634
142,679
22.7%
24.9%
12 Months
Consolidated
2016
8 Months
Consolidated
2015
$'000
$'000
Profit before income taxation
26,954
14,986
Income taxation expense at the rate of 28%
Tax effect of non-deductible items
Non assessable income
Prior year adjustment
Income taxation expense
Represented by:
Current taxation
Deferred taxation
7,547
149
(2)
(1,237)
6,459
5,274
1,185
6,459
4,196
1,231
-
-
5,427
4,675
752
5,427
The prior year adjustment relates to a difference
in the income tax return for the period ending
31 March 2015 regarding the treatment of
IPO expenses and lease incentives.
Imputation Credit Account
The amount of imputation credits at balance
date available for future distributions is $2.8m
at March 2016, $4.6m at March 2015.
41
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
6.2 Deferred taxation
Consolidated deferred tax assets and
liabilities are attributable to the following:
CONSOlIDATED 2016
Assets
liabilities
$'000
$'000
Total
$'000
(388)
84
805
(2,610)
1,826
(283)
(388)
-
-
(2,610)
-
(2,998)
Property, plant & equipment
Inventory and receivables
Cash flow hedge
Intangibles
Provisions and accruals
Property, plant & equipment
Inventory and receivables
Cash flow hedge
Intangibles
Provisions and accruals
-
84
805
-
1,826
2,715
Assets
$'000
154
1,060
-
-
1,705
2,919
CONSOlIDATED 2015
liabilities
$'000
-
-
(99)
(2,821)
-
(2,920)
Total
$'000
154
1,060
(99)
(2,821)
1,705
(1)
AnnUAL RePoRt 2016
42
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
Movement in temporary differences during the year:
CONSOlIDATED 2016
Opening
Balance
Arising on
acquisition
Recognised in
profit or loss
Recognised
in OCI
Total
$'000
$'000
$'000
$'000
$'000
Property, plant & equipment
Inventory and receivables
Cash flow hedge
Intangibles
Provisions and accruals
154
1,060
(99)
(2,821)
1,705
(1)
-
-
-
-
-
-
(542)
(976)
-
211
121
-
-
904
-
-
(1,186)
904
CONSOlIDATED 2015
Opening
Balance
$'000
Arising on
acquisition
Recognised in
profit or loss
Recognised
in OCI
$'000
$'000
$'000
Property, plant & equipment
Inventory and receivables
Cash flow hedge
Intangibles
Provisions and accruals
-
-
-
-
-
-
832
1,123
337
(3,041)
1,936
1,187
(678)
(63)
-
220
(231)
(752)
-
-
(436)
-
-
(436)
(388)
84
805
(2,610)
1,826
(283)
Total
$'000
154
1,060
(99)
(2,821)
1,705
(1)
Accounting policy
The tax expense for the period comprises current
and deferred tax. Tax is recognised in profit
and loss, except to the extent that it relates
to items recognised in other comprehensive
income or directly in equity. In this case, the
tax is also recognised in other comprehensive
income or directly in equity, respectively.
The current income tax charge is
calculated on the basis of the tax laws
enacted or substantively enacted at the
statement of financial position date.
Deferred income tax is provided in full, using
the liability method, on temporary differences
arising between the tax bases of assets and
liabilities and their carrying amounts in the
financial statements. However, deferred income
tax is not accounted for if it arises from initial
recognition of an asset or liability in a transaction
other than a business combination that at
the time of the transaction affects neither
accounting nor taxable profit or loss. Deferred
income tax is determined using tax rates (and
laws) that have been enacted or substantively
enacted by the statement of financial position
43
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
date and are expected to apply when the
related deferred income tax asset is realised
or the deferred income tax liability is settled.
Deferred income tax assets are recognised
to the extent that it is probable that future
taxable profit will be available against which
the temporary differences can be utilised.
Deferred income tax assets and liabilities are
offset when there is a legally enforceable right
6.3 RESERvES
Reorganisation Reserve
Upon acquisition of Metroglass Holdings Limited,
the assets and liabilities acquired were measured
at their pre-combination carrying amounts
without fair value uplift. The difference between
the consideration transferred and the carrying
value of the assets and liabilities acquired was
recorded in the group reorganisation reserve.
Accounting policy
Where an acquisition occurs through group
reorganisation, the identifiable assets and
liabilities acquired are measured at their
pre-combination carrying amounts without
fair value uplift. No new goodwill is recorded.
Any difference between the consideration
transferred and the carrying value of the assets
and liabilities acquired is recorded in equity.
to offset current tax assets against current
tax liabilities and when the deferred income
tax assets and liabilities relate to income
tax levied by the same taxation authority on
either the same taxable entity or different
taxable entities where there is an intention
to settle the balances on a net basis.
Share Based Payment Reserve
The Group currently has a long term incentive
plan for selected employees. The reserve
is used to record the accumulated value of
the plan which has been recognised in the
statement of comprehensive income.
Accounting policy
The long term incentive plan is an equity settled
share based payment which provides eligible
employees with the opportunity to acquire shares
in the Group. The fair value of shares granted
is recognised as an employee benefit expense
with a corresponding increase in equity. The fair
value is measured at grant date and recognised
over the vesting period. The fair value of the plan
has been assessed by an independent valuer.
Share based Payments reserve
Balance at beginning of period
Acquisition of subsidiary
Transfer to equity on group reorganisation
Transfer to capital
Movement in share based payments reserve
Closing Balance
Consolidated
2016
Consolidated
2015
$'000
$'000
785
-
-
(897)
162
50
-
1,062
(505)
-
228
785
AnnUAL RePoRt 2016
44
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
6.4 RElATED PARTy TRANSACTIONS
(a) Directors
The names of persons who were directors
of the Company at any time during the
financial period are as follows: Sir John
Goulter, Michael Alscher, Russell Chenu, Nigel
Rigby, Willem Roest, and Gordon Buswell.
Gordon Buswell was appointed on 6
October 2015. Michael Baster was
appointed as an alternate director to
Michael Alscher on 24 February 2016.
key management and Board of
Directors compensation
Key management are members of the
Senior Leadership Team. The compensation
paid or payable to key management for
employee service is shown below:
Salaries and other short-term employee benefits
Management incentive
Share based payments
BOARD OF DIRECTORS’ COMPENSATION
Directors fees
12 months
Consolidated
2016
8 months
Consolidated
2015
$'000
$'000
2,010
-
162
2,172
1,193
180
228
1,601
12 months
Consolidated
2016
8 months
Consolidated
2015
$'000
469
469
$'000
307
307
6.5 CONTINGENCIES
As at 31 March 2016 the Group had no
contingent liabilities or assets.
6.6 COMMITMENTS
lease commitments: as lessee
Operating leases
The Group leases premises, plant and equipment.
The lease terms for operating leases held
over property are between 3 and 15 years, and
give the Group the right to renew the leases
subject to a mutual redetermination of the
lease rental by the lessee and lessor based on
an independent third party market rent review.
There are no options to purchase in respect of
plant and equipment held under operating leases.
45
Metro PerforMance Glass liMited
notes to the finAnCiAl stAteMents (Cont’D)
Commitments for minimum lease payments in relation to
non-cancellable operating leases are payable as follows:
Within one year
One to two years
Two to five years
Beyond five years
Commitments not recognised in
the financial statements
Consolidated
2016
Consolidated
2015
$'000
$'000
5,989
5,042
14,321
24,299
5,961
5,430
13,525
28,178
49,651
53,094
Accounting policy
Leases in which a significant portion of the
risks and rewards of ownership are retained
by the lessor are classified as operating
leases. Payments made under operating
leases (net of any incentives received from
the lessor) are expensed on a straight-
line basis over the period of the lease.
AnnUAL RePoRt 2016
46
Metro PerforMance Glass liMited
Independent Auditors’ Report
to the shareholders of Metro Performance Glass Limited
Report on the Financial Statements
We have audited the Group financial statements of Metro Performance Glass Limited (“the Company”)
on pages 15 to 46, which comprise the statement of financial position as at 31 March 2016, the
statement of comprehensive income, the statement of changes in equity and the statement of cash
flows for the period then ended, and the notes to the financial statements that include a summary of
significant accounting policies and other explanatory information for the Group. The Group comprises
the Company and the entities it controlled at 31 March 2016 or from time to time during the financial
year.
Directors’ Responsibility for the Financial Statements
The Directors are responsible for the preparation and fair presentation of these financial statements in
accordance with New Zealand Equivalents to International Financial Reporting Standards and for
such internal controls as the Directors determine are necessary to enable the preparation of financial
statements that are free from material misstatement, whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We
conducted our audit in accordance with International Standards on Auditing (New Zealand). These
standards require that we comply with relevant ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial statements. The procedures selected depend on the auditors’ judgement, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditors consider the internal controls relevant to the
Company’s preparation and fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion
on the effectiveness of the Company’s internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of accounting estimates, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion.
Other than in our capacity as auditors and providers of assurance, taxation and advisory services, we
have no relationship with, or interests in, the Group. These services have not impaired our
independence as auditors of the Group.
47
PricewaterhouseCoopers, 188 Quay Street, Private Bag 92162, Auckland 1142, New Zealand
T: +64 9 355 8000, F: +64 9 355 8001, pwc.co.nz
Metro PerforMance Glass liMited Independent Auditors’ Report
Metro Performance Glass Limited
Opinion
In our opinion, the financial statements on pages 15 to 46 present fairly, in all material respects, the
financial position of the Group as at 31 March 2016, and its financial performance and cash flows for
the period then ended in accordance with New Zealand Equivalents to International Financial
Reporting Standards.
Restriction on Use of our Report
This report is made solely to the Company’s shareholders, as a body, in accordance with the
Companies Act 1993. Our audit work has been undertaken so that we might state those matters which
we are required to state to them in an auditors’ report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other than the Company and
the Company’s shareholders, as a body, for our audit work, for this report or for the opinions we have
formed.
Chartered Accountants
26 May 2016
Auckland
PwC
2
AnnUAL RePoRt 2016
48
Metro PerforMance Glass liMited METRO PERFORMANCE GlASS lIMITED
49
coRPoRAte
GoveRnAnce
AnD StAtUtoRy
inFoRMAtion
METRO PERFORMANCE GlASS lIMITED
AnnUAL RePoRt 2016
50
CoRpoRAte goveRnAnCe
The Board and the Senior
Management Team of Metro
Performance Glass (Metro Glass,
the Company) recognise the
importance of good corporate
governance and consider it is
core to ensuring the creation,
protection and enhancement of
shareholder value. Together they
are committed to ensuring that
the Company applies and adheres
to practices and principles that
ensure good governance and that
the highest ethical standards are
maintained to protect the interests
of shareholders and all stakeholders.
The Board recognises the need for the
highest standards of corporate behaviour
and accountability. The Board is committed
to optimizing shareholder returns within a
framework of ethical business practices.
For the reporting period to 31 March 2016, the
Company considers its corporate governance
practices and policies comply with the NZX
Corporate Governance Best Practice Code and
the New Zealand Financial Markets Authority
Corporate Governance in New Zealand – Principles
and Guidelines.
This statement reflects a summary of
the Company’s corporate governance
framework, policies and procedures that
have been in place since the Company’s
listing on the NZX and ASX on 29 July 2014.
The following corporate governance documents
are referred to in this Statement and are
available on the Corporate Governance page
of the Company’s website:
http://www.metroglass.co.nz/
investor-centre/governance/
+ Constitution
+ Board Charter
+ Audit and Risk Committee Charter
+ Market Disclosure Policy
+ Code of Ethics
+ Share Trading Policy
Metro Glass and its operating divisions
and subsidiaries are referred to in this
Statement as the Company or Group.
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Metro PerforMance Glass liMited AnnUAL RePoRt 2016
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Metro PerforMance Glass liMited 5353
Metro PerforMance Glass liMited CoRpoRAte goveRnAnCe (Cont’D)
lAy SOlID FOuNDATIONS FOR MANAGEMENT
AND OvERSIGHT By BOARD
The Board:
The Board has ultimate responsibility for
the strategic direction of Metro Glass and
for overseeing Metro Glass’ management
for the benefit of its shareholders. The
Board’s responsibilities include setting and
overseeing the execution of the Company’s
strategy, and overseeing management in
the operation of Metro Glass’ business.
The Board has adopted a Board Charter (the
Charter) recording its commitment to best
corporate governance practices. The Charter
describes the specific responsibilities, values,
principles and practices that underpin the role
of Directors on the Board. The Charter does
not attempt to provide a complete record of
all of the formal and informal rules associated
with the role of the Board and should be
read in conjunction with the Constitution and
relevant laws, regulations, codes and guidelines.
The Charter is available on the Corporate
Governance page of the Company’s website.
In performing its responsibilities, the Board
should act at all times in a manner designed
to create and continue to build sustainable
value for shareholders and in accordance with
the duties and obligations imposed on them
by Metro Glass’ constitution and by law.
Board Committees:
The Board has established an Audit and Risk
Management Committee (the Audit and Risk
Committee). The role and responsibilities are
outlined in the Audit and Risk Committee’s
Charter. The Board has elected not to establish
a separate Nominations or Remuneration
subcommittees at this time. The Board itself
attends to matters relating to Director
nominations and remuneration thereof.
Delegations:
The Board Charter describes the Board’s role
and responsibilities and Board procedures.
The Board has delegated some of its powers
to committees and to the CEO. This framework
also establishes the authority levels for decision
making within the management team.
Executive Team Evaluation:
Formal performance reviews are conducted
for all staff on an annual basis. The Executive
Team’s performance reviews for the financial
year ended 31 March 2016 have been conducted.
The evaluation is based on role descriptions
and agreed key performance metrics.
The CEO reviews the performance of the Senior
Executives and provides feedback to the Board
including making recommendations regarding
payment of short term performance incentives.
A similar process is followed by the Board
for evaluating the CEO’s performance.
Induction:
New Directors are appropriately introduced
to management and the business so that all
Directors are acquainted with relevant industry
knowledge and receive copies of appropriate
Company documents to enable them to perform
their role. This induction covers topics such
as: the Company’s financial position, strategies,
operations and risk management policies. It also
covers the responsibilities of key people, policies
and procedures, as well as the respective rights,
duties, responsibilities and roles of the Board,
individual Directors and senior executives.
All new managers will receive an induction
programme based on similar elements
including health and safety training but
without financial documents or other sensitive
information that is not relevant to their role.
All other employees undertake training
that covers Company policies, health and
safety, ethics and other operational matters.
AnnUAL RePoRt 2016
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Metro PerforMance Glass liMited
CoRpoRAte goveRnAnCe (Cont’D)
STRuCTuRE THE BOARD TO ADD vAluE
Composition of the Board:
Metro Glass’ Constitution provides for a
minimum of four Directors and subject to this
limitation the number of Directors to hold
office shall be fixed from time to time by the
Board. The Charter contains requirements
relating to New Zealand residency and
the number of independent Directors.
At 31 March 2016 the Board comprised of
six Directors plus one alternate Director:
+ Sir John Goulter (Chairman)
+ Nigel Rigby (Chief Executive)
+ Michael Alscher
+ Gordon Buswell
+ Russell Chenu (Chairman of Audit
and Risk Committee)
+ Bill Roest
+ Michael Baster (Alternate Director)
Gordon Buswell was appointed as a Director
on 6 October 2015. Michael Baster was
appointed as an alternate Director for
Michael Alscher on 24 February 2016.
The Directors bring a wide range of skills
to the Board including corporate strategy,
business and financial management
nationally and internationally, sales and
marketing, mergers and acquisition, capital
markets and corporate governance.
Selection and Role of Chairman:
The Constitution provides that one of the
Directors may be appointed as Chair of the
Company and the Directors will determine
the period for which the chairperson is to
hold office. Sir John Goulter, an independent
Director, has been appointed Chairman.
Director Independence:
Directors are considered to be independent
if they are non-executive and do not have an
interest or relationship that could or could
be perceived to unreasonably influence their
decisions relating to the Company or interfere
with their ability to act in the Company’s
best interests. Disqualifying relationships
are defined in the Charter. The Board will
review any determination it makes as to a
Director’s independence on becoming aware
of any information that may have an impact
on the independence of the Director. For this
purpose, Directors are required to ensure
that they immediately advise the Board of
any relevant new or changed relationships to
enable the Board to consider and determine
the materiality of the relationships.
As at 31 March 2016, four of the seven Directors,
Sir John Goulter, Gordon Buswell, Russell Chenu
and Bill Roest, are considered by the Board to be
Independent Directors in accordance with the
NZX listing rules. Michael Alscher and Michael
Baster are employees of Crescent Capital
which is a substantial shareholder in the
Company, and Nigel Rigby, the Company’s
CEO, are each not considered by the
Board to be Independent Directors.
Conflicts of Interest:
The Board Charter outlines the Board’s policy
on conflicts of interest. Where conflicts of
interest arise, Directors must ensure that the
nature of the conflict is adequately disclosed and
excuse themselves from discussions in respect
of the relevant matter and, in accordance with
the NZX listing rules, not exercise their
right to vote in respect of such matters.
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Metro PerforMance Glass liMited
CoRpoRAte goveRnAnCe (Cont’D)
that sets out the Terms and Conditions of
Appointment and Remuneration Schedule. It
also sets out the expectations of the Company,
the Director’s duties, responsibilities and
powers, insurance and indemnity arrangements,
and rights of access to information.
All new Board members are provided
with an extensive briefing on the
Company and industry related matters
within thorough induction process.
Retirement and Re-Election:
Assuming no new Directors are appointed in the
interim, the Directors who will stand for re-
election at the 2016 Annual Shareholders Meeting
will be Gordon Buswell and Russell Chenu.
Profiles are contained in the Notice of
Meeting which will be mailed to shareholders
and will also be available on the Investors
section of the Company’s website.
Director Remuneration:
Non-executive Directors are paid a fixed fee
in accordance with the determination of the
Board. Full disclosure of Director remuneration
is included in the statutory information
section of this Annual Report.
External Advice:
An individual Director or a committee may,
with the approval of the chairperson of the
Board, retain and consult with external advisers
(including legal) at Metro Glass’ expense where
the committee or individual deems it necessary
to carry out its, his or her functions.
Director Appointments:
The provisions regarding the election and
retirement of Directors are contained in
the Constitution. The Board will review
from time to time the composition of the
Board and will identify and evaluate suitable
individuals for appointment as a Director as
and when an appointment is to be made. In
evaluating a candidate for appointment as
a Director, the Board will consider criteria
including the particular skill sets identified
by the Board as being required at the time
as well as the individual’s experience,
professional qualifications, ability to exercise
sound business judgment, integrity and moral
reputation, any potential conflicts of interest or
legal impediments to serving as a Director, and
their willingness and availability to
commit the time required to serve as
an effective Director of the Company.
Background checks will be conducted.
Given the current size of the Board, there is
presently no need for a Nominations Committee
as the full Board acts in this capacity.
An individual being appointed as an independent
Director must be independent according to
NZX definitions and not have any disqualifying
relationships as defined in the Board Charter.
The Company’s Constitution and NZX and ASX
listing rules require a newly appointed Director
to stand for election at the next Annual
Shareholders Meeting (ASM). Sir John
Goulter and Michael Alscher were elected
as Directors of Metro Performance
Glass Limited at the Company’s Annual
Shareholders’ Meeting on 26 August 2015.
New Directors provide the Company with a
written consent to act as a Director and
receive a formal Letter of Appointment
AnnUAL RePoRt 2016
56
Metro PerforMance Glass liMited CoRpoRAte goveRnAnCe (Cont’D)
Board, Committee and Director Evaluation:
In accordance with the Board and Audit &
Risk Committee Charters, the Board annually
reviews its performance, policies and
practices and reviews the performance of
its Committees and each Director. This
review is carried out both formally and
informally. The Board was constituted in its
current form in July 2014 ahead of the NZX
Main Board and ASX listing and undertook
its first Performance Evaluation in 2015.
The performance of the Audit and Risk
Committee is assessed annually against its
Charter and other relevant criteria as determined
by the Board. The first assessment was carried
out in the last quarter of the 2016 financial year.
Director Education:
The Company encourages Directors to
continue to develop their knowledge and
skills as a Director. With the prior approval
from the Chairman, Directors may attend
appropriate courses or seminars for
continuing education at the Company’s cost.
Director Share Ownership:
There is no requirement for Directors to own
shares in the Company or to reinvest a portion
of Director remuneration in Company shares.
However, non-executive Directors are encouraged
to own shares. All Directors and employees
are required to comply with the Company’s
Securities Trading policy in undertaking any
trading in the Company’s shares. The table
of Directors’ shareholdings is included in the
Disclosures section of this Annual Report.
Indemnities and Insurance:
In accordance with Section 162 of the Companies
Act 1993 and the Company’s Constitution, the
Company indemnifies Directors in relation to
potential liabilities and costs they may incur for
acts or omissions in their capacity as Directors.
The Directors’ and Officers’ Liability Insurance
covers risks normally covered by such policies
arising out of acts or omissions of Directors
and employees in their capacity as such. Details
are recorded in the interests register.
PROMOTE ETHICAl AND RESPONSIBlE
DECISION MAkING
Code of Ethics:
The Company has a Code of Ethics that
establishes a framework of standards by which
the Directors, employees, contractors and advisors
of Metro Glass and its related companies are
expected to carry out their responsibilities.
It is not an exhaustive list of acceptable behaviour;
rather it facilitates decision making that is
consistent with Metro Glass’ values, business
goals and legal and policy obligations. Metro
Glass Directors and managers are committed to
leading in accordance with these standards of
ethical and professional conduct and ensuring
that such standards are communicated
to the people who report to them.
The Company’s Code of Ethics is available
from the Corporate Governance page of the
Company’s website.
Diversity:
The Board has not, at this stage, adopted a
Diversity Policy. It intends to conduct an overall
review of Metro Glass’ diversity practices and
statistics prior to adopting any Diversity Policy.
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Metro PerforMance Glass liMited AnnUAL RePoRt 2016
AnnUAL RePoRt 2016
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Metro PerforMance Glass liMited CoRpoRAte goveRnAnCe (Cont’D)
Membership:
The Audit and Risk Committee comprises
three independent, non-executive Directors:
Russell Chenu, Bill Roest and Sir John Goulter.
Russell Chenu, the Chairman of the Audit and
Risk Committee, is a qualified accountant and
is not the Chairman of the Board. Details of
the relevant qualifications and experience
of all Audit and Risk Committee members
are disclosed in their biographies on pages
[19] and [20] of this Annual Report.
Other Directors, the CEO and the CFO attend
the Audit and Risk Committee meetings by
invitation. The relevant partner and staff of
Metro Glass’ external auditors also attend
meetings by invitation on a regular basis.
The Company intends to appoint an outsourced
internal auditor. Once appointed the
outsourced internal auditor will also attend
meetings by invitation on a regular basis.
Meetings:
The Audit and Risk Committee meets at
least three times each year and has direct
access to Metro Glass’ external and internal
auditors and senior management. On at least
one occasion each year, the Audit and Risk
Committee meets with the external and internal
auditors without management present.
Share Trading:
The Company’s Share Trading Policy governs
trading in the Company’s securities by:
+ all Directors
+ all Officers
+ all members of the Senior Leadership Team (SLT)
+ any employee who reports directly to a
member of the SLT
+ any employee who reports to the Group
Financial Controller
+ any employee who the CEO deems this policy
should apply to
The Policy complies with the NZX and ASX Listing
Rules. A copy is available from the Corporate
Governance page of the Company’s website.
SAFEGuARD INTEGRITy IN FINANCIAl REPORTING
Audit and Risk Management Committee:
The Board has an Audit and Risk Committee
that has been established to:
(a) assist the Board in fulfilling its
responsibilities for Metro Glass’ financial
statements and external financial reporting;
(b) assist the Board in ensuring that the
ability and independence of the external
auditors to carry out their statutory audit
role is not impaired, or could reasonably
be perceived to be impaired; and
(c) assist the Board in ensuring appropriate
accounting policies and internal controls
are established and maintained and assist
the Board in ensuring the effective and
efficient management of all business risks.
The Audit and Risk Committee’s Charter is
available from the Corporate Governance
page of the Company’s website.
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Metro PerforMance Glass liMited CoRpoRAte goveRnAnCe (Cont’D)
MAkE TIMEly AND BAlANCED DISClOSuRE
Metro Glass is subject to the disclosure and
reporting obligations imposed under the Listing
Rules of NZX, ASX, the Companies Act and other
relevant legislation. The Board has adopted a
Market Disclosure Policy, available from the
Corporate Governance page of the Company’s
website, which sets out how the Company
will comply with the required disclosure and
reporting obligations. Metro Glass is committed
to its obligation to inform shareholders
(both current and prospective) and market
participants of all information that might have
a material effect on the price of its shares.
The Company keeps stakeholders informed
by lodging announcements issued to NZX and
ASX on the Investor Section of its website.
Disclosure Officer:
The Board has not appointed a Disclosure
Officer. However, the CFO or delegate, will
co-ordinate the actual form of disclosure of
the material Information with the relevant
members of management and make the
disclosure to the NZX and ASX as required.
Disclosure issues are discussed
appropriately with, and proposed releases
are approved by the Board. If necessary,
external legal advice is obtained.
RESPECT THE RIGHTS OF SHAREHOlDERS
Metro Glass endeavours to keep its shareholders
informed of all important developments
concerning the Company and encourages
them to follow announcements about the
Company. Metro Glass communicates with its
shareholders using the following means:
+ periodic market announcements, which are
released first to NZX and ASX;
+ periodic investor briefings, which are also
released first to NZX and ASX;
+ the Annual Report;
+ the Annual Shareholders Meeting and the
Notice of Meeting; and
+ the Company’s corporate website
Electronic Communications:
Shareholders have the option to
receive communications from, and send
communications to, the Company and
its security registry electronically.
Annual Shareholders’ Meeting;
Shareholders have the opportunity to ask
questions of the Board and of the external
auditors, who attend the Annual Shareholder
Meeting. The auditors are available to
answer questions from shareholders in
relation to the conduct of the audit, the
independent audit report and the accounting
policies adopted by Metro Glass.
AnnUAL RePoRt 2016
60
Metro PerforMance Glass liMited
CoRpoRAte goveRnAnCe (Cont’D)
The health and safety of the Company’s staff,
contractors and customers is of paramount
concern to the Board. Accordingly all risk reviews
have a component that specifically looks at health
and safety risks. To support an improvement
in health and safety awareness the Company
has appointed a national Health and Safety
Manager who reports to the General Manager of
Operations. He is also supported by four regional
Safety Advisors located at the Company’s four
major manufacturing facilities. The Company
maintains a risk register that is reviewed annually.
REMuNERATE FAIRly AND RESPONSIBly
The Board as a whole has responsibility
for the activities related to remuneration.
All remuneration packages are reviewed
at least annually, taking into account
individual and Company performance, market
movements and independent advice.
The objective of the Company’s remuneration
policy is to ensure that the remuneration
of Directors and all staff properly
reflects each person’s accountabilities,
duties, responsibilities and their level of
performance, to ensure that remuneration
is competitive in attracting, motivating and
retaining staff of the highest calibre.
The CEO’s performance is reviewed by the
Board. The CEO reviews the performance of the
Executive Team and makes recommendations
to the Board for approval in relation to
the team’s remuneration and achievement
of key performance indicators (KPIs).
RECOGNISE AND MANAGE RISk
The identification and effective management
of the Company’s risks is a priority of
the Board. It is responsible for:
(a) identifying the principal risks
of Metro Glass’ business;
(b) reviewing and ratifying Metro Glass’
systems of internal compliance and
control, risk management and legal
compliance, to determine the integrity and
effectiveness of those systems; and
(c) approving and monitoring internal and
external financial and other reporting,
including reporting to shareholders, the
NZX, the ASX and other stakeholders.
The Board makes use of the Audit and Risk
Committee to ensure that effective risk
management systems and internal controls are
in place, including the review of material risk
exposures and the steps Management has taken
to monitor, control and report such exposures.
The Board has made the CEO accountable for
all operational and compliance risk across the
Group. The CFO has management accountability
for the implementation of the risk framework
across all of the Company’s businesses
Metro Glass’ main risks and mitigation plans
are reviewed semi-annually by the Audit
and Risk Committee and the Board.
As part of its risk management framework
Metro Glass continually assesses risks against all
relevant areas of material business risk. A number
of such risks were noted in the Prospectus issued
in July 2014, the majority of which continue to
remain relevant. The Prospectus is available in
the Investor section of the Company’s website.
See section 8 of the Investment Statement.
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Metro PerforMance Glass liMited CoRpoRAte goveRnAnCe (Cont’D)
The Board completed a full review of the
compensation structures of the CEO and Senior
Management in 2015. The resulting remuneration
structure is made up of three elements:
+ A fixed base salary
+ A short term incentive (STI)
+ A long term incentive (LTI)
The long term incentive plan was publicly
announced on 7 March 2016 and is made up
of both performance share rights and share
options. The plan participants for the current
financial year are part of the company’s senior
management. The LTI is designed to secure
those employees’ retention in Metro Glass and
to reward performance that underpins the
achievement of Metro Glass’ business strategy
and long term shareholder wealth creation. The
key features of the 2016 LTI plan are as follows:
+ Participants will be offered an annual award
of a specified number of both performance
rights and share options in Metro Glass
(in accordance with the LTI rules)
+ The performance rights will enable participants
to acquire shares in Metro Glass with no
consideration payable, subject to Metro
Glass achieving set performance hurdles
and meeting certain vesting conditions
+ The share options enable participants to
acquire shares in Metro Glass at a market
based exercise price, subject to Metro
Glass achieving set performance hurdles
and meeting certain vesting conditions
A total of 822,159 share options and 120,791
performance share rights were issued under
the initial grants pursuant to the 2016 LTI plan.
Non-executive Directors are paid a fixed
fee in accordance with the determination of
the Board. The Director fee pool was set at
$600,000 in the 2014 Prospectus. The Chairman
of the Board receives $160,000 per annum.
The non-executive Directors receive $80,000
per annum. The chairman of the Audit and Risk
Committee, receives an additional $20,000
per annum. Other members of the Audit and
Risk Committee, receive an additional $10,000
per annum. Alternate Directors are unpaid.
Director remuneration was set at a level
advised by an independent Board consultant
at the time the Board was being established
prior to the July 2014 IPO. The Board reviews
its fees on a periodic basis. The Executive
Director (CEO) does not receive additional
remuneration in his capacity as a Director.
Increases in the Director fee pool must
be approved by shareholders at an Annual
Shareholder Meeting. The Board does not
propose to seek an increase in the pool at the
2016 meeting. No retirement or termination
benefits are paid to non-executive Directors
however Directors are entitled to be paid for
reasonable travel and other expenses incurred
by them in connection with their attendance at
Board or Shareholder meetings, or otherwise
in connection with the Metro Glass Group’s
business. The Company does not offer an equity-
based remuneration scheme for Directors.
Given the Board composition the full Board
reviews issues relating to remuneration. The
Board considers that Director and executive
remuneration is appropriate and is not excessive.
AnnUAL RePoRt 2016
62
Metro PerforMance Glass liMited stAtutoRy infoRMAtion
STOCk ExCHANGE lISTING
Our shares are listed on the New Zealand Stock Exchange (NZX) and Australian Stock Exchange (ASX).
Shares on issue as at 1 June 2016:
Register
New Zealand
Australia
Total
Security
Holders
units
MPG (NZL)
MPP (AUS)
1,977
29
151,317,773
33,712,227
MPG (Dual)
2,006
185,030,000
Securities issued under the 2016 long term incentive plan
2016 long Term Incentive Scheme
Security
Holders
units
Performance Share Rights
Share Options
MPG (NZx)
MPG (NZX)
4
4
120,791
822,159
TOP 20 SHAREHOlDERS
Our top 20 shareholders as at 1 June 2016 were as follows:
Rank
Investor Name
Shares at
% of
Footnote*
1 June 2016
Shares
1
2
3
4
5
6
7
8
9=
9=
11
12
13
14
15
16
17
18
19
20
Tea Custodians Limited
National Nominees New Zealand Limited
HSBC Custody Nominees (Australia) Limited
New Zealand Superannuation Fund Nominees Limited
Forsyth Barr Custodians Ltd
FNZ Custodians Limited
Investment Custodial Services Limited
Bnp Paribas Noms Pty Ltd
Guardian Nominees No 2 Ltd
Premier Nominees Limited
Crescent Capital Partners Management Pty Ltd
Crescent Capital Partners Management Pty Ltd
Bnp Paribas Nominees NZ Limited
Nigel James Rigby
J P Morgan Nominees Australia Limited
Accident Compensation Corporation
JPMORGAN Chase Bank
Citicorp Nominees Pty Limited
Crescent Capital Partners Iii (Belgium) Bvba
National Nominees Limited
*
*
*
*
*
**
***
*
*
*
17,380,526
10,836,721
10,793,891
8,259,109
7,973,745
7,517,141
7,037,404
6,825,067
6,216,314
5,964,358
5,862,611
5,862,611
5,638,508
5,143,401
5,105,728
4,508,505
4,175,422
3,659,837
3,569,208
3,321,671
9.39%
5.86%
5.83%
4.46%
4.31%
4.06%
3.80%
3.69%
3.36%
3.22%
3.17%
3.17%
3.05%
2.78%
2.76%
2.44%
2.26%
1.98%
1.93%
1.80%
Totals: Top 20 holders of Ordinary Shares
135,651,778
73.32%
Totals: Remaining Holders Balance
49,378,222
26.69%
* Held through New Zealand Central Securities Depository Limited (NZCSD). NZCSD provides a custodial depository service which allows
electronic trading of securities by its members. As at 1 June, 73,770,896 Metro Performance Glass Limited Shares (or 39.9% of the ordinary
shares on issue) were held through NZCSD.
* for both New Zealand Superannuation Fund Nominees Limited, and Guardian Nominees No 2 Ltd
**as trustee for Crescent Capital Partners Trust IIIA
***as trustee for Crescent Capital Partners Trust IIIB
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Metro PerforMance Glass liMited
AnnUAL RePoRt 2016
AnnUAL RePoRt 2016
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Metro PerforMance Glass liMited stAtutoRy infoRMAtion (Cont’D)
SuBSTANTIAl SHAREHOlDERS
A “substantial shareholder” is defined in the
Securities Markets Act 1988. Shareholders
are required to disclose their holdings to
us and to our share registrar by giving a
“Substantial Shareholder Notice” when:
+ They begin to have a substantial shareholding
(5% or more of our shares).
+ There is a subsequent movement of 1% or
more in a substantial holding, or if they cease
to be have a substantial holding.
+ There is any change in the nature or interest in
a substantial holding.
According to notices given under the Securities
Market Act 1988 the following persons were
Substantial Shareholders as at 1 June 2016:
Schroder Investment Management (Australia) Limited
Crescent Capital Partners Management Pty Limited
Harbour Asset Management Limited
Salt Funds Management Limited
Henderson Global Investors (Australia) Limited
Fisher Funds Management Limited
ANZ New Zealand Investments Limited
Milford Asset Management Limited
Number
of shares
15,716,045
15,294,430
13,956,152
13,264,667
10,234,771
9,934,502
9,726,082
9,384,362
%
8.49%
8.27%
7.54%
7.17%
5.53%
5.37%
5.26%
5.07%
The following shareholders ceased to be substantial shareholders during the period 1 June 2015 to 1 June 2016: New
Zealand Superannuation Fund Nominees Limited on 7 October 2015, IOOF Holdings Limited on 2 November 2015 (due
to Henderson Group plc’s acquisition of Perennial Growth Management from IOOF Holdings Limited) and AMP Capital
Investors (New Zealand) Limited and AMP Capital Investors Limited on 7 April 2016.
65
Metro PerforMance Glass liMited stAtutoRy infoRMAtion (Cont’D)
DISTRIBuTION OF SHAREHOlDERS
As at 1 June 2016
Range
1-1000
1001-5000
5001-10000
10001-50000
50001-100000
Greater than 100000
Number
of holders
120
601
559
609
64
51
Number
of shares
83,208
1,918,102
4,392,174
12,924,316
4,497,135
161,215,065
%
0.04
1.04
2.37
6.98
2.43
87.13
Total
2,004
185,030,000
100.00
vOTING RIGHTS
Section 15 of our Constitution states that
a shareholder may vote at any meeting
of shareholders in person or through a
representative. Where voting is by a show of
hands or voice, every shareholder present (or
through their representative) has one vote. In a
poll, every shareholder present (or through their
representative) has one vote per fully-paid up
share they hold. Unless the Board determines
otherwise, shareholders may not exercise the
right to vote at a meeting by casting postal votes.
More detail on voting can be found in our
Constitution at the following link:
http://www.metroglass.co.nz/media/1493/
metroglass-constitution-of-the-company.pdf
TRADING STATISTICS
Metro Performance Glass Limited is
listed on both the NZX and ASX.
the trading range for the period 1 April 2015
to 31 March 2016 are as follows:
2016 (NZx)
2016 (ASx)
Minimum:
Maximum:
Range:
NZD$1.30 (5 October 2015)
AUD$1.15 (13 Oct 2015)
NZD$1.90 (11 May 2015)
AUD$1.85 (22 April 2015)
NZD$1.30 - NZD$1.90
AUD$1.15 - AUD$1.85
Total shares traded
99,002,100
1,546,900
AnnUAL RePoRt 2016
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Metro PerforMance Glass liMited
stAtutoRy infoRMAtion (Cont’D)
DIvIDEND POlICy
Dividends and other distributions with respect
to the shares are only made at the discretion
of the Board of Metro Performance Glass. Any
dividend can only be declared by the Board if the
requirements of the Companies Act 1993 are
also satisfied. The Board’s decision to declare
a dividend for shareholders in any financial
year will depend on, amongst other things:
+ any statutory or regulatory requirements;
+ the financial performance of Metro Performance
Glass;
+ one-off or non-recurring events;
+ Metro Performance Glass capital expenditure
requirements;
+ the availability of imputation credits;
+ prevailing business and economic conditions;
+ the outlook for all of the above; and
+ any other factors deemed relevant by the Board.
Subject to the above, Metro Performance
Glass intends to make dividend payments to
Shareholders semi-annually, in respect of half
years ending 30 September and full years ending
31 March. The dividend is currently expected to
be approximately 55% to 75% of NPATA. However,
the actual ratio of the dividend paid to NPATA is
expected to vary over time reflecting the above
factors. Metro Performance Glass intends to
weight dividends to the second half, with the
first half targeting 40% to 50% of the total
expected dividend for the year. However, the
split will vary according to actual and forecast
NPATA and the factors described above.
It is the Board’s intention to attach
imputation credits to dividends to
the extent they are available.
In respect of the 2016 financial year, Metro
Performance Glass paid a full imputed
interim dividend of 3.6 cents per share on
22 January 2016, and has declared a fully
imputed final dividend of 4.0 cents per
share which will be paid on 25 July 2016.
NZx AND ASx WAIvERS
Metro Performance Glass received confirmation
of waivers from ASX that are standard for a New
Zealand Company listed on the ASX (including
confirmation that Metro Performance Glass may
prepare and publish its financial information in
accordance with New Zealand financial standards).
On 24 November 2015, Metro Performance Glass
Limited changed its ASX admission category from
an ASX Listing to an ASX Foreign Exempt Listing.
This change followed amendments to the ASX
Listing Rules announced on 10 September 2015
that allow an entity with its primary listing on
the NZX Main Board to alleviate its compliance
burden as a dual listed entity. The ASX Foreign
Exempt Listing category is based on a principal
of substituted compliance, recognising that for
secondary listings, the primary regulatory role
and oversight rest with the home exchange.
Metro Performance Glass continues to
have a full listing on the NZX Main Board.
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Metro PerforMance Glass liMited stAtutoRy infoRMAtion (Cont’D)
DIRECTORS’ REMuNERATION
The total remuneration and other benefits to
Directors (and past Directors) for services for
the period ended 31 March 2016 were as follows:
Director
Position
Appointed/
Resigned
2016 total
remuneration
Sir John Goulter
Independent, Non-Executive Chairman,
Appointed 5/07/14
160,000
Member of Audit and Risk Committee
Nigel Rigby
Executive Director and Chief Executive Officer
Appointed 5/07/14
- *
Willem (Bill) Roest
Independent, Non-Executive Director,
Appointed 5/07/14
90,000
Member of Audit and Risk Committee
Russell Chenu
Independent, Non-Executive Director and
Appointed 5/07/14
100,000
Chairman of Audit and Risk Committee
Michael Alscher
Non-Executive Director
Appointed 31/03/15
Gordon Buswell
Independent, Non-Executive Director
Appointed 6/10/15
80,000
38,788
Michael Baster
Alternate Non-Executive Director
Appointed 24/02/16
Nil
The Director fee pool for a full financial year has been set at $600,000.
*The CEO, Nigel Rigby received $500,000 in total remuneration during the twelve month
trading period to 31 March 2016.
DIRECTOR ATTENDANCE
The individual attendances of Directors at
Board and Committee meetings for the
year to 31 March 2016 is as follows:
Director
Meetings held
Sir John Goulter
Nigel Rigby
Willem (Bill) Roest
Russell Chenu
Michael Alscher
Gordon Buswell
Michael Baster
(c) indicates chairperson
Board
meetings
attended
Audit Committee
meetings
attended
Appointed/
Resigned
14
14 (c)
5
4
Appointed 5/07/14
13
14
14
10
7
1
Not applicable
Appointed 5/07/14
5
5 (c)
Appointed 5/07/14
Appointed 5/07/14
Not applicable
Appointed 31/03/15
Not applicable
Appointed 6/10/15
Not applicable
Appointed 24/02/16
AnnUAL RePoRt 2016
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Metro PerforMance Glass liMited stAtutoRy infoRMAtion (Cont’D)
DIRECTORS’ INTERESTS
Directors’ interests recorded in the Interests Register of
the Company as at 31 March 2016 are set out as follows:
NATuRE OF INTEREST
Sir John Goulter kNZM, JP
Marsden Maritime Group Limited
Marsden Maritime Holdings Limited
New Zealand Business and Parliament Trust
Northport Limited
Opua Commercial Estate Limited
Packard House Limited
Michael Thomas Alscher
Australian Clinical Laboratories
Breezway Australia Pty Limited
Cardno Limited
ClearView Limited
Crescent Capital Partners III (Belgium) BVBA
Crescent Capital Partners Management Pty Limited
Crumpler Pty Limited
GroundProbe Pty Limited
National Dental Care Pty Limited
Southern Sun Pty Limited
Director
Chairman
Chairman
Chairman
Director / Shareholder
Director / Shareholder
Chairman
Director
Chairman
Director
Director
Director
Director
Director
Chairman
Chairman
Michael lawrence Baster (alternate for Mr Alscher)
New Zealand Panels Group Limited
Director
Gordon John Buswell
Building Industry Federation
Construction Strategy Group
Quad Concepts Limited
Platinum Homes Limited
Registered Master Builders Association
About Direction Limited
Chairman
Deputy Chairman
Strategic Advisor
Chairman
Director
Director / Shareholder
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Metro PerforMance Glass liMited stAtutoRy infoRMAtion (Cont’D)
Russell langtry Chenu
5R Solutions Pty Limited
CIMIC Group Limited
James Hardie Industries plc
Reliance Worldwide Corporation Limited
Nigel James Rigby
Canterbury Glass & Glazing Limited
Christchurch Glass & Glazing Limited
Hawkes Bay Glass & Glazing Limited
I G M Software Limited
Metroglass Finance Limited
Metroglass Holdings Limited
Metropolitan Glass & Glazing Limited
Taranaki Glass & Glazing Limited
Willem Jan Roest
Fisher & Paykel Appliances Holdings Limited
Housing Foundation Limited
Synlait Milk Limited
Synlait Milk Finance Limited
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
AnnUAL RePoRt 2016
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Metro PerforMance Glass liMited stAtutoRy infoRMAtion (Cont’D)
DIRECTORS’ SHAREHOlDING IN METRO PERFORMANCE Gl ASS lIMITED
The Directors’ respective shareholding in Metro Performance Glass Limited
as at 31 March 2016 is as follows:
Number of shares
directly held
Consideration paid
Date of acquisition
Sir John Goulter
Russell Chenu
Nigel Rigby
20,000
25,000*
5,143,401
$34,000
$42,500
Shares were provided in
consideration for 4,000,000
Class C shares in Metroglass
Holdings Limited
29 July 2014
29 July 2014
29 July 2014
Willem (Bill) Roest
25,000**
$42,500
29 July 2014
* Held by Barratta Super Fund, of which Russell Chenu is the sole beneficiary.
** Willem Jan Roest is a legal owner of the securities as a trustee of the WJ and IJ Roest Family Trust, jointly with the other trustee, Ineke
Joanna Henrietta Roest. Willem Jan Roest is also a beneficiary of the WJ and IJ Roest Family Trust.
Michael Alscher is a Director of Crescent Capital
Partners Management Pty Limited which has
the power to exercise, or control the exercise
of, the rights attached to 15,294,430 shares.
Michael Baster is also an employee of Crescent
Capital Partners Management Pty Limited.
SuBSIDIARy COMPANy DIRECTORS
The following Companies were subsidiaries of Metro
Performance Glass Limited as at 31 March 2016:
Company
Directors
Canterbury Glass & Glazing Limited
Christchurch Glass & Glazing Limited
Hawkes Bay Glass & Glazing Limited
I G M Software Limited
Metroglass Finance Limited
Metroglass Holdings Limited
Metropolitan Glass & Glazing Limited
Taranaki Glass & Glazing Limited
Nigel Rigby, John Fraser-Mackenzie
Nigel Rigby, John Fraser-Mackenzie
Nigel Rigby, John Fraser-Mackenzie
Nigel Rigby, John Fraser-Mackenzie
Nigel Rigby, John Fraser-Mackenzie
Nigel Rigby, John Fraser-Mackenzie
Nigel Rigby, John Fraser-Mackenzie
Nigel Rigby, John Fraser-Mackenzie
DIvERSITy
In accordance with NZX requirements, our
reported gender breakdown at Senior Leadership
and Board level as at 31 March 2016 is:
Board
Senior Leadership Team
0
0
7
6
7
6
0%
0%
Female
Male
Total
% Female
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Metro PerforMance Glass liMited stAtutoRy infoRMAtion (Cont’D)
EMPlOyEE REMuNERATION
During the twelve months ended 31 March 2016
the following employees and former employees
received individual remuneration over $100,000:
Remuneration range
$100,000 – $110,000
$110,000 – $120,000
$120,000 – $130,000
$130,000 – $140,000
$140,000 – $150,000
$150,000 – $160,000
$160,000 – $170,000
$170,000 – $180,000
$180,000 – $190,000
$190,000 – $200,000
$200,000 – $210,000
$240,000 – $250,000
$310,000 – $320,000
$340,000 – $350,000
$500,000 – $510,000
Number of
employees
13
8
8
6
7
7
1
2
4
1
1
1
1
2
1
63
CuRRENCy
Within this Annual Report, all amounts are in
New Zealand dollars unless otherwise specified.
CREDIT RATING
We have not requested a credit rating.
ANNuAl SHAREHOlDER MEETING
Our annual shareholder meeting will be
held on 24 August 2016 in Auckland. We will
confirm the time and place by notice to all
our shareholders nearer to that date.
ANNuAl REPORT
Our Annual Report and Interim Reports are
all available on our website at http://www.
metroglass.co.nz/investor-centre/annual-
interim-reports/. We will email our Annual
Report to those shareholders who have opted
for e-communication with us and our share
registry. We prefer to communicate with our
shareholders by email without using up valuable
printing resources and postage costs, but any
shareholder who does request a hard copy of our
Annual Report will be sent one in the regular post.
AnnUAL RePoRt 2016
72
Metro PerforMance Glass liMited CoMpAny DiReCtoRy
REGISTERED OFFICE
5 Lady Fisher Place
East Tamaki
Auckland 2013
New Zealand
Email: glass@metroglass.co.nz
Phone: +64 (09) 927 3000
BOARD OF DIRECTORS
Sir John Goulter – Chairman,
Member of Audit and Risk Committee
Nigel Rigby – Executive Director and
Chief Executive Officer
Willem (Bill) Roest – Non-Executive Director,
Member of Audit and Risk Committee
Gordon Buswell – Non-Executive Director
Russell Chenu – Non-Executive Director and
Chairman of Audit and Risk Committee
Michael Alscher – Non-Executive Director
Michael Baster – Alternate Non-Executive
Director for Michael Alscher
SENIOR lEADERSHIP
Nigel Rigby – Chief Executive Officer
John Fraser – Mackenzie - Chief Financial Officer
Geoff Rasmussen – General Manager, Operations
Dean Brown – North Island Region Manager
Barry Paterson – South Island Region Manager
Len Hatton – General Manager, People
& Organisational Development
AuDITOR
PricewaterhouseCoopers
22/188 Quay Street
Auckland 1142
New Zealand
lAWyERS
Bell Gully
Vero Centre
48 Shortland Street
Auckland 1140
New Zealand
BANkERS
ANZ Bank New Zealand Limited
SHARE REGISTRAR
Link Market Services
Level 11, Deloitte Centre
80 Queen Street, Auckland 1010
PO Box 91976, Auckland 1142
Other Information
Please visit us at our website:
www.metroglass.co.nz
73
Metro PerforMance Glass liMited METRO PERFORMANCE GlASS lIMITED
FuRTHER INFORMATION ONlINE
This Annual Report, all our core governance
documents (our Constitution, some of our
key Policies and Charters), our Investor
relations policies and all our announcements
can be viewed on our website:
http://www.metroglass.co.nz/investor-centre/
AnnUAL RePoRt 2016
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