A N N UA L
REP OR T
2 0 1 9
Chair and Chief Executive’s Review ....................................... 2
Management Commentary ....................................................... 6
Our Strategy at a Glance......................................................... 10
Board of Directors .................................................................... 12
Senior Leadership Team ...........................................................14
Financial Statements ................................................................17
Notes to the Financial Statements .....................................22
Independent Auditor’s Report ..............................................52
Corporate Governance ............................................................ 57
This report is dated 23 May 2019
and is signed on behalf of the
Board of Metro Performance
Glass Limited by Peter Griffiths,
Chair, and Bill Roest, Director.
Peter Griffiths
Chairman
Statutory Information ..............................................................71
Company Directory ................................................................... 76
Willem (Bill) Roest
Director
CHAIR AND
CHIEF EXECUTIVE’S
REVIEW
It has been a challenging year with
Metro Performance Glass’s group
performance experiencing both significant
achievements and disappointments.
Positives can be taken from the continued
improvements and stronger financial
results demonstrated in the New Zealand
business; however, it has taken longer
for a similar improvement to emerge in
Australia.
Peter Griffiths
CHAIRMAN
Simon Mander
CEO
2
Acknowledging these
unsatisfactory results in
Australia, we have set our
priorities for the year ahead
and restructured our
operations to enable us to
deliver on them.
We undertook to prioritise
debt reduction at the
expense of dividends in the
near term, as we work
towards our gearing target
of 1.5 times EBITDA to net
debt. At 31 March 2019 this
ratio was 2.1 times. Reported
net debt reduced by $11.0
million year on year, ahead of
the $7.0 million we had
previously guided.
Good progress was made on
people- and customer-
focused initiatives, with
improved service metrics and
stronger people retention
achieved over the course of
the year.
The company operates in a
dynamic and competitive
environment. The board and
management remain
confident in the group’s
strategy and are committed
to its objectives of providing
the best customer service,
developing its people, and
leveraging its scale to
efficiently deliver leading
glass solutions.
NEW CEO IN PLACE
After an extensive search, we
announced the appointment
of Simon Mander as Chief
Executive in November 2018.
Since joining, Simon has had
the opportunity to visit all of
our Australasian sites and to
meet many of our 1,200 staff,
as well as many of our
customers and suppliers.
Simon believes that the
group has clear direction and
goals, while being acutely
aware of the challenges
ahead. He considers the
group to be firmly focused on
rebuilding shareholder value,
through further improved
performance in New Zealand
and by executing its plan for
initially stabilising the
Australian business to enable
profitable growth over time.
The health and safety of our
people is an absolute priority.
Glass is a fragile, heavy and
hazardous product to work
with, so we must ensure that
our people are well trained,
well equipped and have safety
at the forefront of their
mind.
REVENUE AND
EARNINGS PERFORMANCE
Group revenue of $267.8
million in FY19 was in line with
last year, with New Zealand
revenue growth of 2.1%
offset by a 9.0% decline in
Australian revenue.
In New Zealand, Metroglass
grew EBIT1 by 6.3% to $31.1
million in FY19, but our poor
execution in Australia saw
EBIT fall from $3.2 million in
FY18 to a loss of $4.8 million
this year. This was
particularly impacted by
operational issues in Victoria
and New South Wales (NSW)
and the start-up of the
new Tasmanian factory.
Consequently, group
EBIT declined 18.4% to
$25.2 million.
1 Earnings before interest and tax, before significant items.
ANNUAL REPORT 2019METRO PERFORMANCE GLASS LIMITED We are pleased
with the
achievements
made in
New Zealand
this year, but
we continue
to see many
opportunities
for further
improvement.”
$267.8M
GROUP REVENUE
$11.0M
REPORTED NET DEBT
REDUCTION
Following the poor
performance in Australia, the
carrying value of Australian
Glass Group’s (AGG) assets
has been reviewed, resulting
in a NZ$9.6 million impairment
on AGG’s intangible assets.
This is presented as a
significant item in the
financial statements. Net
profit for the period (NPAT)
declined to $5.0 million from
$16.3 million in the prior year
primarily as a result of the
impairment charge. NPAT
before significant items
declined to $14.2 million from
$18.4 million in the prior year.
NEW ZEALAND
– STEADY PROGRESS
In New Zealand, which
represents approximately
80% of group revenues,
Metroglass made good
progress this year with
improved operating
performance and financial
results.
In line with our strategy of
making Metroglass a great
place to work, we invested in
a number of people-focused
initiatives including enhanced
on-boarding, increased front-
line leadership in our plants,
additional training, and
improved pay and recognition
across the business. We have
also grown our apprenticeship
base and aim to double this in
FY20. These initiatives have
pleasingly seen voluntary
staff turnover reduce from
31% in FY18 to 22% in FY19,
and absenteeism decrease by
approximately 10% over the
course of the year,
reinforcing the improved
engagement and stability of
our team.
In addition, Metroglass
invested in building closer
relationships with its
customers. Our recent New
Zealand-wide customer
survey provided valuable
feedback on how to prioritise
our improvement efforts,
with quality, delivery on time,
and delivery in full being the
top three priorities noted.
While there will always be
more to do, in FY19 we
achieved further improved
customer service levels - e.g.
with ‘late-tail-delivery-in-full-
on-time’ performance
improving from an average
from 86% in H2-FY18 to 93%
in FY19.
Alongside better operating
performance, higher gross
margins in New Zealand have
been supported by selling an
increasingly higher-value
product mix, including more
safety- and heat-
strengthened glass as a
result of building code
changes in 2017.
Metroglass is being more
considered in how it brings on
new sales volumes, or
tenders for complex
commercial projects. New
Zealand’s revenue and
margins both improved year
on year, however
management believe its share
of the overall market declined
with increased imports and
domestic competition.
The company also reduced
the cost base of its
Canterbury business in the
year, and will have moved
from a peak of four
Christchurch sites to two by
July this year. This footprint
will better align with the
lower regional activity levels
and the customer needs in
that market.
We are pleased with the
achievements made in New
Zealand this year, but we
continue to see many
opportunities for further
improvement.
COMPETITIVE LANDSCAPE
The New Zealand market is
rapidly evolving, with the
buoyant housing and
construction markets
encouraging investment from
new and existing players.
In November 2018, a large
aluminium extruder, based in
the upper North Island
announced its intention to
enter the glass processing
market. This announcement
had a negative impact on
market commentator’s views
of Metroglass’ value, and
consequently the share price.
The board considers that the
current share price does not
reflect the underlying value
of the business, and
incorporates an overly
pessimistic view of the
group’s future in both
New Zealand and Australia.
As at today, there continues
to be little reliable
information available about
the new entrant’s specific
plans; however, Metroglass’
board and management have
undertaken detailed market
impact assessments and
anticipate that once the
plant commences production
a gradual reduction in our
sales from window
fabricators affiliated to the
3
CHAIR AND CHIEF EXECUTIVE’S REVIEW CONTINUED
new entrant, primarily in the
upper North Island, could be
expected in the following
years.
However, we would also note
that today our customers
already have the ability to
select between multiple glass
suppliers, and yet choose to
work with us. We’re working
hard to continually improve
their experience and have
made good steps forward
this year.
Metroglass is the clear
market leader in New Zealand,
and is well placed to succeed
having already significantly
invested in new
manufacturing capacity and
people capabilities. The
company will continue to
focus on differentiating and
reinforcing its value
proposition to its customers
through continued execution
of its strategy. We will draw
on our scale advantages,
strong customer
relationships and the depth
of talent the business has
built up over its more than
30-year history.
AUSTRALIA – IMPROVEMENTS
EMERGING FOLLOWING
BUSINESS RESET
AGG had a challenging year
as it worked to bed in the
substantial changes made
across the business over the
past 18 months. These
changes have included a
major capital programme, the
shift from domestic to
international glass supply,
moving the business’
manufacturing and sales
focus towards double glazing
products, and opening AGG’s
Tasmanian plant. Progress
was slower and more
challenging than expected,
with inconsistent
manufacturing performance
and high staff turnover
significantly impacting
customer service in the 2018
calendar year.
AGG’s disappointing financial
performance this year was
particularly driven by the
operational issues in Victoria
and NSW and the start-up of
the new Tasmanian factory.
These challenges have been
progressively addressed
through increased
management support as well
as additional training and
recruitment to fill capability
gaps. As the business
stabilises, its ongoing
operating costs will be
reviewed.
In the second half of the
financial year, and particularly
in the final quarter, AGG
steadily improved its service
delivery in all three states,
4
reduced reworks and had a
more stable and engaged
workforce. These positive
changes have resulted in a
number of customers
returning, albeit some are
trialling supply on a limited
basis as AGG works to regain
their confidence and trust.
Accordingly, these changes
take time to flow into
financial results.
The new Tasmanian
manufacturing facility is
AGG’s third plant and the
seventh across the group.
Tasmania pleasingly met its
year one financial goals, which
included breaking even on an
EBIT basis in the final quarter
of FY19.
The commissioning of the
Tasmanian plant also freed
up production capacity in
AGG’s largest plant based in
Victoria, which had previously
serviced Tasmania. The key
Victorian business remains a
profitable business. The spare
capacity in Victoria was not
utilised within FY19 resulting
in a weaker financial
performance versus the prior
year, but provides the
opportunity for future sales
growth in this region.
The NSW business has faced
considerable challenges in
changing its manufacturing
and sales focus away from
processed glass products (i.e.
shower doors, balustrades)
ANNUAL REPORT 2019METRO PERFORMANCE GLASS LIMITED disappointing results around.
NSW in particular, as an
underperforming business,
has clear milestones in place
for performance
improvement that must be
met within the year ahead.
We still see considerable
opportunity in Australia,
which has much lower market
penetration and an increasing
uptake for quality, bespoke
double-glazing products. This
is being driven by increased
electricity and gas prices,
national energy-efficiency
targets, a road map of
legislative changes
supporting increased
penetration of double glazing
in Australia, and shifts in
consumer preference.
We are actively educating the
market on the benefits of
high-performance glass and
double glazing products, and
are already seeing awareness
and penetration increase
significantly in Victoria and
Tasmania. NSW is currently at
a much lower base but with a
large, medium to long term
opportunity.
towards double glazing,
where we see better
potential over the medium
term. The extensive
upgrading and reconfiguring
of NSW manufacturing
equipment in early 2018 was
not well executed and caused
prolonged disruption to our
people and customers.
With all equipment
commissioning and training
completed and new
management making a
positive impact, the NSW
business improved its output
and service delivery, reduced
staff turnover by a third, and
won a number of new
customers in the later
stages of the financial year.
We are implementing a state-
by-state plan to turn AGG’s
We still see
considerable
opportunity
in Australia,
which has much
lower market
penetration and
an increasing
uptake for quality,
bespoke double-
glazing products.”
Further declines in Australian
housing starts are expected,
particularly in multi-
residential inner-city demand.
AGG primarily services the
new detached housing
construction and alterations
and additions markets that
have historically been more
stable. We continue to see
market opportunities as a
smaller player, in a much
larger and more fragmented
market.
We are proud of the quality
and breadth of the glass
solutions the Metroglass
group provides and want to
record our appreciation of
the commitment of the
management team and staff
this year. There is a clear
strategy and plan in place as
we position the group for
success and improved
financial results in the coming
year.
The company will provide
shareholders with a trading
update, including preliminary
financial guidance for the
FY20 financial year, at our
Annual Shareholders’ Meeting
to be held on 26 July.
PETER GRIFFITHS
Chair
SIMON MANDER
Chief Executive
BALANCE SHEET
Strong cash generation from
operations, a further
reduction in working capital in
New Zealand, lower capital
expenditure across the group
and the temporary
suspension of dividends
enabled us to reduce
reported net debt by
$11 million.
We refinanced our debt
facilities in September 2018
for a further three years,
with no changes to
covenants. The board will
continue to prioritise debt
reduction until the group’s
leverage ratio (net debt to
rolling 12-month EBITDA2)
falls to approximately 1.5
times. At 31 March 2019 this
ratio was 2.1 times.
MARKET CONDITIONS
AND OUTLOOK
As always, changes in the
strength of the local
economies in which we
operate remains a key issue
for the company. In
New Zealand, economic and
demographic fundamentals
have continued to support
strong demand for
construction and glazing
products. Looking forward,
similar conditions are
expected for the coming
period; however, we also
anticipate supply constraints
in the broader market will
persist, potentially delaying
the impact of the recent
growth in residential
consents.
2 Earnings before interest, tax,
depreciation and amortisation.
5
MANAGEMENT
COMMENTARY
SUMMARY
Group revenue of $267.8 million for the
full year to 31 March 2019 was in line
with the previous 12-month period.
However, EBIT for the year fell 18.4%
to $25.2 million, down from $30.9
million in the prior year.
Capital expenditure of $7.8
million represents a 62.0%
reduction on the $20.6 million
invested in the prior year.
Lower capital expenditure
across the group, further
reductions in working capital
in New Zealand and the
temporary suspension of
dividends have enabled us to
reduce reported net debt by
$11 million to $83.3 million.
Group gearing (net interest-
bearing debt / (net interest-
bearing debt plus equity)
reduced year on year from
37.0% to 34.7% at 31 March
2019.
Following the poor
performance in Australia,
the carrying value of AGG’s
assets has been reviewed,
resulting in a NZ$9.6 million
impairment on AGG’s
intangible assets. This is
presented as a significant
item in the financial
statements.
Net profit for the period
(NPAT) declined to $5.0
million from $16.3 million in
the prior year primarily as
a result of the impairment
charge. NPAT before
significant items declined
to $14.2 million from $18.4
million in the prior year.
6
ANNUAL REPORT 2019METRO PERFORMANCE GLASS LIMITED
GROUP REVENUE BY SEGMENT ($M)
2% (NZ)
(0%)
268.3
267.8
(0%)
143.2
143.1
+9%
+2%
-9%
48.2
52.5
55.4
50.4
21.5
21.8
Residential
NZ
Commercial Glazing
NZ
Retrofit
NZ
Australian Glass Group
Total Group
Revenue
FY18
FY19
SUMMARY OF RESULTS FOR THE 12 MONTHS ENDED 31 MARCH 2019 (FY19)
$M
Revenue
Segmental EBIT2
Group costs
EBIT before significant items
EBIT
Net profit for the period before significant items
Net profit for the period (or NPAT)
NEW ZEALAND
AUSTRALIA
GROUP
FY19
217.4
31.1
FY18
212.9
29.2
FY19
50.4
(4.8)
FY18
55.4
3.2
FY19
267.8
FY18
268.3
(1.1)
25.2
15.7
14.2
5.0
(1.5)
30.9
28.0
18.4
16.3
GROUP EBIT BRIDGE ($M)
4.8
30.9
1.0
0.5
0.9
0.5
0.4
2.5
2.2
1.4
1.1
0.4
0.4
25.2
New Zealand
Australia
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7
MANAGEMENT COMMENTARY CONTINUED
NEW ZEALAND REVENUE
$217.4M
(+2.1%)
Total revenue in New Zealand
grew by $4.5 million (or 2.1%)
to $217.4 million. The North
Island revenue increase
offset the sales decline in the
South Island, which was
principally due to lower
activity in the Canterbury
region - although the rate of
regional decline was less than
for the prior year.
On a national basis,
residential sales revenue was
in line with the previous year.
Commercial Glazing revenue
grew 8.9% to $52.5 million,
with growth in the North
Island again more than
offsetting the declines
observed in the South Island.
The business is continuing to
focus on selecting suitable
projects that are within its
core competencies, and that
it can deliver on time and at a
profit.
COMMERCIAL GLAZING
REVENUE GREW
8.9% TO
$52.5M
Our New Zealand operations
delivered an EBIT of $31.1
million, an increase of 6.3%
from last year. This was
generated by improved unit
pricing, changes in product
mix, and savings in material
costs as a result of improved
inventory and factory
management. Offsetting this
improvement were increased
distribution and factory
management costs, short-
term incentive payments,
increased overheads and
higher depreciation.
These results were
supported by a greater focus
on our people, including the
on-boarding of new
management talent and
capability, increasing the
front-line leadership within
our plants, and aligning our
wage rates with the market.
Metroglass’s New Zealand
operations also delivered
improved customer service
and operational metrics
following the launch of a
number of people- and
process-focused initiatives.
Pleasingly, over the course of
the year, there has been a
distinct decline in voluntary
staff turnover.
CASH FLOW AND
BALANCE SHEET
The New Zealand operation
continued with its progress
reducing working capital by
$3.1 million for the second
successive year on the back
of reduced inventory levels.
Net operating cash flows
improved marginally on the
prior year with improved
EBITDA partially offset by the
timing of tax payments in the
period.
8
ANNUAL REPORT 2019METRO PERFORMANCE GLASS LIMITED
second half of the year, and
in particular in the final
quarter, and we continue to
engage with customers to
win back business. We are
confident these initial
improvements will allow this
business to improve its
financial performance.
AGG opened a new
processing plant in Hobart,
Tasmania, in early 2018. This
plant enables the company to
offer a better service to local
customers and has freed up
capacity at our Victorian
plant, which previously
serviced the Tasmanian
market. The operation did not
start up as smoothly as we
would have liked, and initially
this proved detrimental to
service levels and ultimately
to market share across the
island. However, the plant is
now performing well, and the
business met its year one
financial goals, which included
breaking even on an EBIT
basis in the final quarter of
FY19.
In FY19 we formed a new
leadership team which has
brought considerable
manufacturing experience
and a focus to the business.
We are pleased to report
that operational performance
has seen improvement
across AGG over the second
half, although its translation
to financial results has
lagged expectations.
We are confident that with
the recruitment of additional
line management and
changing the culture of the
organisation, the improving
service levels will support
continued new customer
acquisition, which will lead to
increased sales and better
financial outcomes.
AUSTRALIA REVENUE
$50.4M
(–9.0%)
AGG’s EBIT1 fell from a
positive $3.2 million in FY18 to
an EBIT loss of $4.8 million in
FY19. This result was
principally due to operational
and service difficulties in
Victoria and NSW, and the
slow start-up of a new
processing facility in
Tasmania.
STATE BY STATE
In Victoria, sales declined as
we began servicing the
Tasmanian market from our
new Tasmanian plant, rather
than shipping in product from
Victoria. The Victorian plant
did not utilise this additional
capacity locally in the
financial year which reduced
Victoria’s EBIT by $2.5 million
in FY19 versus the prior year.
In addition, Victoria lost
market share in processed
toughened glass as a result
of its operational issues
which reduced EBIT by $2.2
million.
The NSW operations
experienced a particularly
challenging year, struggling
to achieve efficiency targets
in the first half exacerbated
by equipment issues and a
refocus of the business to
soft-coat double glazing. The
business continues its
transition from one that
predominantly produces
processed toughened glass
to being focused on double
glazing.
During the year, this
transition has impacted
service levels and revenue.
However, operational
performance improved in the
1 Earnings before interest and tax,
before significant items.
AGG today holds a relatively
small position in the large and
fragmented South East
Australian glass processing
market. We continue to see
opportunity and long-term
value in this investment as it
can benefit from the
anticipated changes in the
market that will boost
demand for double glazing
and the performance
improvement initiatives
currently under way will have
greater effect.
CASH FLOW AND
BALANCE SHEET
Working capital in AGG was in
line with the prior year as
lower accounts receivable
were offset by a higher
inventory balance as
expected sales did not
eventuate. The business had
negative operating cash flow
on account of the loss
incurred during the year.
9
OUR STRATEGY
AT A GLANCE
OU R V IS ION
To be the leader
in glass solutions
OUR PURPOSE
Making lives
brighter every day
FOR CUSTOMERS
By providing the best service
FOR OUR PEOPLE
By providing a great place to work
T HE ME T RO WAY
SAFETY
PRODUCT &
PROCESS QUALITY
OUR
CUSTOMER
OUR
PEOPLE
OWNING
OUR WORK
Embed ‘Home safe
every day’ as our
way of life
Right first time,
every time
At the centre of
everything we do
We value,
inspire, train and
develop our team
We take
responsibility and
work as one team
10
ANNUAL REPORT 2019METRO PERFORMANCE GLASS LIMITED
1
2
3
4
OUR OBJECTIVES
FY19 PROGRESS
DELIVER MARKET LEADING
CUSTOMER SERVICE TO OUR CUSTOMERS
Quality and service are key differentiators for
our customers and critical to their success and
profitability. The New Zealand and Australian
businesses are now well equipped to satisfy
anticipated market demands over the next
24 months, and will focus on processing and
installation efficiency, productivity and reliability.
• Improved customer service in NZ with 93% of items delivered on time of
within 48 hours if late in FY19, versus 86% in H2-FY18. Additionally, product
quality improved by 10% in H2-FY19 vs. H1-FY19 (reduced external reworks)
• Conducted a NZ-wide customer survey to align service improvement
priorities
• AGG service levels below target in calendar year 2018
Action: Reset of Australian business improved customer service metrics
(DIFOT, reworks) in all three states through the second half of the financial
year and into FY20
DEVELOP OUR
ORGANISATIONAL CAPABILITIES
Improving our ability to execute against our
strategic initiatives is critical, and following a
number of years of rapid growth, a greater
focus is now being placed on investing in our
people, their capabilities, and our support
systems.
UPHOLD OUR SCALE STRENGTH THROUGH
PRODUCT & CHANNEL LEADERSHIP
Metroglass’ scale and leadership position in the
New Zealand flat-glass market provides
advantages across customer support,
procurement, manufacturing and distribution.
We will continue to operate across multiple
channels in NZ, offering varied cycle exposures
and growth opportunities.
AGG operates in much larger and more
fragmented market where a smaller targeted
player can be successful. AGG will use its new
double glazing capacity and improved supply
chain to deliver profitable growth in the South
East Australian market.
Glass is a rapidly evolving product and we have
invested to ensure we continue to provide the
leading offering in our markets.
LEVERAGE OUR SCALE TO
DELIVER SOLUTIONS EFFICIENTLY
A persistent focus on increasing efficiency and
automation and lowering costs is essential for
the long-term sustainability of our business,
and to enable us to compete successfully
against imports and changing industry
dynamics.
• Mixed H&S performance with increased LTIFR and decreased TRIFR
Action: Focusing on improved safety through preventative efforts;
appointed a Group H&S Manager (also on senior leadership team)
• Increasingly stable team in NZ, with voluntary staff turnover reducing from
31% in FY18 to 22% in FY19 and absenteeism declining by ~10%
• Delivered initiatives to better support, train and engage our people. Included
a group-wide staff engagement survey and appointment of a learning and
development manager
• Strengthened AGG leadership team and front-line factory supervision in NZ
• Aligned NZ wage rates with a competitive labour market and reinvigorated
our apprenticeship programme
• Competed a number of IT system improvements, including updated people
management systems, new company intranet and improved Retrofit tools
• New Group CEO Simon Mander joined in November 2018
• Metroglass’ NZ revenue and margins grew, but market share based on glass
imports declined. This was impacted by additional market capacity being
added, reducing glass inventory by $1.6m and our selective approach to
supplying complex products & projects
• Commercial glazing revenue 8.9%, residential and Retrofit sales in line with
last year
Action: Realign retrofit nationally, executing an operational effectiveness
programme, and reprioritised marketing activity
• New Tasmanian plant met its year one financial goals, including reaching EBIT
break even in Q4 FY19
• Australian revenue declined 9.0%, following operational issues in Victoria and
New South Wales
Action: Regain customers’ confidence and trust through sustained
improvements in operating performance. Good progress made in the
second half of the financial year is continuing
• AGG launched its ‘good-better-best’ range of double glazed units using
low-emissivity (LowE) glass
• AGG product specifications now available in the widely used Window Energy
Rating Scheme (WERS) system
• Increased NZ margins through favourable product mix and pricing, with
efficiency gains offsetting cost pressures in labour, distribution and materials
• Achieved labour efficiency gains (and service improvements) in NZ resulting
from a more stable workforce and increased front-line leadership roles
• Completed improved inventory management system trials in two NZ plants
with positive results
• Reshaped the Canterbury business in line with reduced activity levels
• Refreshed manufacturing continuous improvement program launched in
Auckland and Christchurch with good early progress
• Operational challenges impacted Australian labour efficiency, particularly in
the first half of the year
Action: Initial cost reduction plan has been executed. As the business
stabilizes, its operating costs will be reviewed
11
BOARD OF
DIRECTORS
PETER GRIFFITHS
INDEPENDENT, NON-EXECUTIVE
CHAIR, MEMBER OF THE AUDIT
AND RISK COMMITTEE
Appointed: September 2016
ANGELA BULL
INDEPENDENT, NON-EXECUTIVE
DIRECTOR, CHAIR OF THE
PEOPLE AND CULTURE
COMMITTEE
Appointed: May 2017
After a career in the energy
industry Peter has become a
professional director. His last
executive position was as
Managing Director of BP Oil
New Zealand for 10 years,
retiring in 2009. He has
previously served on a number
of boards including Z Energy,
Marsden Maritime Holdings,
The New Zealand Refining
Company, and New Zealand Oil
and Gas. He is also Chair of the
New Zealand Business and
Parliament Trust and has
private interests in marine
contracting and general
aviation. Peter holds a
Bachelor of Science (Honours)
degree from Victoria
University of Wellington.
Angela is currently the Chief
Executive Officer of Tramco
Group Limited, a large New
Zealand property investment
company, a director of the
Real Estate Institute of New
Zealand, and a director of
Callaghan Innovation Research
Limited. She joined Tramco
Group in February 2016. Prior
to leading Tramco, Angela held
a number of senior positions
over a 10-year period with
Foodstuffs, most recently
being General Manager
Property Development for
Foodstuffs North Island. This
was preceded by a legal
career, including roles with
Chapman Tripp, the Crown
Law Office and Simpson
Grierson. Angela holds
Bachelor of Arts and Bachelor
of Laws degrees from the
University of Auckland.
12
ANNUAL REPORT 2019METRO PERFORMANCE GLASS LIMITED RHYS JONES
INDEPENDENT, NON-EXECUTIVE
DIRECTOR, MEMBER OF
THE PEOPLE AND CULTURE
COMMITTEE
Appointed: April 2018
Rhys has had a 30-year
career working in the
Australasian building material
and packaging industries. He
is currently the Executive
Director and Chairman of the
Executive Board of Vulcan
Steel Limited, a large privately
owned trans–Tasman steel
distributor with over 30
business units across
Australasia. He is also a
director of Carbine Aginvest
Corporation Limited (formally
Tru Test Corporation Limited).
Prior to joining Vulcan Steel in
2006, Rhys has held senior
roles in particular with Carter
Holt Harvey Ltd and Fletcher
Challenge, including as Chief
Operating Officer of the Pulp,
Paper, and Packaging business
of Carter Holt Harvey. He
holds a Master of Business
Studies degree from Massey
University and a Bachelor of
Science from Victoria
University of Wellington.
WILLEM (BILL) ROEST
INDEPENDENT, NON-EXECUTIVE
DIRECTOR, CHAIR OF THE AUDIT
AND RISK COMMITTEE
Appointed: July 2014
Bill has extensive experience
in the New Zealand corporate
sector, both in executive and
non-executive functions, in
particular in the domains
of finance and corporate
governance. 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 as
Managing Director of Fletcher
Residential and Fletcher
Aluminium. 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.
GORDON BUSWELL
INDEPENDENT, NON-EXECUTIVE
DIRECTOR, MEMBER OF
THE PEOPLE AND CULTURE
COMMITTEE
Appointed: October 2015
Gordon has more than 25
years’ experience in the
building and construction
industry. He currently holds a
number of industry-
associated directorships,
including the Building Industry
Federation, Platinum Homes
Limited, Construction
Strategy Group and the
Registered Master Builders
Association of New Zealand.
He is also a Chartered
Member of the New Zealand
Institute of Directors. Prior to
moving into governance roles,
Gordon was the Chief
Executive Officer of
Independent Timber
Merchants (ITM) for 13 years
and also spent 12 years with
Carter Holt Harvey. Gordon
holds a Bachelor of
Commerce degree from the
University of Auckland.
RUSSELL CHENU
INDEPENDENT, NON-EXECUTIVE
DIRECTOR, MEMBER OF THE
AUDIT AND RISK COMMITTEE
Appointed: July 2014
Russell has significant
experience in the corporate
sector with more than 23
years in senior management
roles. He has considerable
expertise in senior finance-
related roles, including with
building products companies.
Russell is currently an
independent director and the
Chairman of the Audit and
Risk Committee of ASX-listed
businesses CIMIC Group
Limited and Reliance
Worldwide Corporation
Limited. He is also a director
of James Hardie Industries
plc, following a 23-year
career with the company,
holding various management
and executive positions in a
number of countries, including
most recently serving as
Group Chief Financial Officer
from 2004 to 2013. Before
this role, Russell served as
Chief Financial Officer for
several ASX-listed companies
(TAB, Delta Gold, Australian
National Industries and
Pancontinental Mining) and
Mighty River Power. He was
also previously Treasurer of
Pioneer International. Russell
has a Bachelor of Commerce
degree from The University of
Melbourne, a Master of
Business Administration from
Macquarie Graduate School
of Management and is a
Member of the Society of
Certified Practising
Accountants (Australia).
13
SENIOR
LEADERSHIP TEAM
SIMON MANDER
CHIEF EXECUTIVE OFFICER
JOHN FRASER-MACKENZIE
CHIEF FINANCIAL OFFICER
Joined: November 2018
Joined: May 2015
ROBYN GIBBARD
GENERAL MANAGER
UPPER NORTH ISLAND
Joined: February 1997
GARETH HAMILL
GENERAL MANAGER
LOWER NORTH ISLAND
Joined: April 2002
Robyn leads the Upper
North Island region for
Metroglass and has worked
in the business for more
than 20 years. She has
previously led Metroglass’
sales force nationally, and
held many customer-facing
roles across commercial
glazing, branch
management and
sales management.
Before John’s appointment
as Chief Financial Officer, he
worked for Goodman Fielder
for eight years, initially as
Finance Director of their
Dairy Division and 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
degree (majoring in Finance)
from the University of Cape
Town.
Gareth leads the Lower North
Island region and has worked
for Metroglass for more than
15 years, and brings
particular experience in
commercial glazing. He is a
Director of the Glass and
Glazing Institute of New
Zealand, and also a Member
of The Institute of Building
(NZIOB) and of the Window &
Glass Association of New
Zealand (WGANZ) Glass
Technical Committee.
Gareth holds a Bachelor of
Building Science degree from
Victoria University of
Wellington..
SImon has broad leadership
expertise at senior levels
across industries ranging
from ag-tech, building
products, to flexible and
fibre-based packaging. During
Simon’s career, he has
specialised in performance
improvement, as well as in
strategy development and
execution. He has worked
internationally in a number of
industries and has recent
experience in the New Zealand
and Australian building
products market.
Simon joined Metroglass from
Tru-Test Corporation Limited,
a world-leading New Zealand-
based ag–tech company
where he was CEO. Prior roles
have been with well-known
companies such as Fletcher
Building, DS Smith, Carter
Holt Harvey, Partners in
Performance, Lion Nathan and
McKinsey. He was also a
director of NZX-listed
Wellington Drive Technologies
for nine years.
Simon has a trade background
in aircraft engineering and
holds a Bachelor of
Engineering (Mech) degree
from the University of
Auckland. In addition, he
represented New Zealand in
yachting on a number of
occasions including in the
International 470 class at the
1988 Olympic Games.
14
ANNUAL REPORT 2019METRO PERFORMANCE GLASS LIMITED ANDREW DALLISON
GENERAL MANAGER
SOUTH ISLAND
Joined: June 2018
BARRY PATERSON
GENERAL MANAGER
COMMERCIAL GLAZING
Joined: November 2005
DAYNA SAUNDERS
HUMAN RESOURCES
DIRECTOR
Joined: November 2014
AMANDEEP KAUR
GROUP HEALTH AND
SAFETY MANAGER
Joined: April 2019
Andrew leads the South Island
region for Metroglass. He
brings over 30 years’
experience, having held senior
sales, technical, operational
and general management
roles in both the packaging
and chemical industries.
Before joining the company,
his most recent role was
leading the packaging division
of The Industrial Group, based
in Saudi Arabia.
Andrew holds a Master of
Business Administration
degree from Deakin University
in Australia and a Bachelor of
Science degree from the
University of Canterbury.
Barry leads Metroglass’
technical team and
commercial glazing business
nationally. He has 15 years of
experience across the New
Zealand and Australian glass
industries. Barry has held a
diverse range of commercial
and management finance
roles in the arable and
manufacturing industries, and
was a director on the board
of Westland Milk Products
from 2010 to 2016.
He holds a Bachelor of
Commerce and Management
degree and a Postgraduate
Diploma in Marketing from
Lincoln University.
Dayna leads Metroglass’
Human Resources team
nationally. She has over 10
years’ experience in HR,
Talent & Recruitment
spending eight years at
Fletcher Building before
commencing with
Metroglass.
Dayna holds a Bachelor of
Business degree in
Marketing & Management
and a NZ Diploma in
Business from the Auckland
University of Technology.
Amandeep leads Group Health
and Safety across both our
New Zealand and Australia
businesses, responsible
for the development and
implementation of health
and safety strategy. She
brings with her a wealth of
experience, with strengths
in creating and implementing
a high-performing safety
culture. Before joining the
company, Amandeep held
senior health and safety roles
at Harrison Grierson, Sinclair
Knight Merz, and Compass
Group, after starting her
career in quality assurance
with Nestlé, Frucor and Real
Foods.
Amandeep holds a Master
in Food Science Technology
degree as well as a Graduate
Diploma in Occupational
Health and Safety.
15
NON-GAAP FINANCIAL INFORMATION
Metroglass’ standard profit measure prepared under New Zealand Generally Accepted Accounting Practice (GAAP) is profit for the period,
or net profit after tax. Metroglass has used non-GAAP measures which are not prepared in accordance with New Zealand International
Financial Reporting Standards (NZ IFRS) when discussing financial performance in this document. The directors and management believe
that these non-GAAP financial measures provide useful information to readers to assist in the understanding of the Group’s financial
performance, financial position or returns, and used internally to evaluate the performance of business units and to establish operational
goals. These measures should not be viewed in isolation, nor considered as a substitute for measures reported in accordance with NZ
IFRS. Non-GAAP financial measures may not be comparable to similarly titled amounts reported by other companies.
Definitions of non-GAAP financial measures used in this report:
• EBITDA: Earnings before interest, tax, depreciation and amortisation.
• EBITDA before significant items: EBITDA less significant items, being: $9.6m of intangible asset impairment cost in FY19 (“Impairment
of intangible assets”) and $2.9m of CEO departure and recruitment costs in FY18 (“CEO departure & recruitment costs”).
• Segmental EBIT: Segment EBIT before significant items.
• EBIT before significant items: EBIT less significant items, being: intangible asset impairment cost and CEO departure & recruitment
costs.
• Profit for the period before significant items: Profit for the period less significant items, being: intangible asset impairment cost and
CEO departure & recruitment costs.
• NPATA: Profit for the Period before the amortisation of acquisition-related intangibles and its associated tax effect.
GAAP TO NON-GAAP RECONCILIATION
FULL YEAR TO 31 MARCH
Profit for the period before significant items
Less: Impairment of intangible assets
Less: CEO departure and recruitment costs (tax effected)
Profit for the period (GAAP)
Add: taxation expense
Add: net finance expense
Earnings before interest and tax (EBIT) (GAAP)
Add: depreciation & amortisation
EBITDA
EBIT (GAAP)
Add: Impairment of intangible assets
Add: CEO departure and recruitment costs
EBIT before significant items
EBITDA
Add: Impairment of intangible assets
Add: CEO departure and recruitment costs
EBITDA before significant items
Profit for the period (GAAP)
Add back: amortisation of acquisition-related intangibles and its associated tax effect
NPATA
16
FY19
($M)
14.2
(9.2)
–
5.0
5.5
5.1
15.7
14.5
30.1
15.7
9.6
–
25.2
30.1
9.6
–
39.7
5.0
1.7
6.7
FY18
($M)
18.4
–
(2.1)
16.3
7.1
4.7
28.0
12.4
40.4
28.0
–
2.9
30.9
40.4
–
2.9
43.3
16.3
1.9
18.2
ANNUAL REPORT 2019METRO 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
Notes to the consolidated financial statements
Basis of preparation
1
Financial performance
2
2.1 Segment information
2.2 Revenue
2.3 Operating expenditure
2.4 Significant items
2.5 Earnings per share
3 Working capital
3.1 Trade receivables
3.2
Inventories
3.3 Trade and other payables
3.4 Financial instruments
4.
Long term assets
4.1 Property, plant and equipment
4.2
5. Debt & equity
5.1
5.2 Contributed equity
6. Other
6.1
6.2 Deferred taxation
6.3 Group reserves
6.4 Related party transactions
6.5 Contingencies
6.6 Commitments
Independent auditor’s report
Interest bearing liabilities
Intangible assets
Income taxation
18
19
20
21
22
22
26
26
28
28
29
29
30
30
32
32
33
39
39
40
44
44
46
48
48
48
50
50
51
51
52
17
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 MARCH
Sales revenue
Cost of sales
Gross Profit
Distribution and glazing related expenses
Selling and marketing expenses
Administration expenses
Earnings before significant items, interest and tax
Significant items
Earnings before interest and tax
Interest expense
Interest income
Profit before income taxation
Income taxation expense
Profit for the period
Other Comprehensive Income
Exchange differences on translation of foreign operations
Cash flow hedges
Total comprehensive income for the period attributable to shareholders
Earnings per share
CONSOLIDATED CONSOLIDATED
Notes
2019
$’000
2018
$’000
Restated (Note 1)
2.1
2.3
2.3
2.3
2.3
2.4
6.1
267,836
(146,517)
121,319
(47,593)
(13,621)
(34,870)
25,235
(9,560)
15,675
(5,105)
19
10,589
(5,547)
5,042
(253)
(226)
4,563
268,293
(145,844)
122,449
(45,854)
(13,137)
(32,536)
30,922
(2,922)
28,000
(4,807)
141
23,334
(7,056)
16,278
(538)
106
15,846
Basic and Diluted Earnings per share (cents per share)
2.5
2.7
8.8
The Board of Directors authorised these financial statements for issue on 23 May 2019.
For and on behalf of the Board:
Peter Griffiths
Chairman
Willem (Bill) Roest
Director
The above statement of comprehensive income should be read in conjunction with the accompanying notes.
18
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 31 MARCH
CONSOLIDATED CONSOLIDATED
Notes
2019
$’000
2018
$’000
Assets
Current assets
Cash and cash equivalents
Trade receivables
Inventories
Derivative financial instruments
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
Bank overdraft
Trade and other payables
Contract liabilities
Income tax liability
Derivative financial instruments
Provisions
Total current liabilities
Non-current liabilities
Deferred tax liabilities
Interest bearing liabilities
Derivative financial instruments
Lease incentive
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Retained earnings
Group reorganisation reserve
Share based payments reserve
Foreign currency translation reserve
Cash flow hedge reserve
Total equity
3.1
3.2
3.4
4.1
6.2
4.2
5.1
3.3
3.4
6.2
5.1
3.4
5.2
6.3
3.4
The above statement of financial position should be read in conjunction with the accompanying notes.
5,488
38,839
22,934
172
5,345
72,778
64,581
4,958
146,442
215,981
288,759
–
29,286
1,080
2,408
659
916
34,349
1,947
88,832
1,057
2,650
2,961
97,447
131,796
360
40,417
23,531
–
5,537
69,845
68,372
3,083
159,487
230,942
300,787
3,857
31,331
–
2,776
315
1,331
39,610
3,514
90,818
919
2,572
3,018
100,841
140,451
156,963
160,336
306,693
21,329
(170,665)
725
(4)
(1,115)
306,653
24,233
(170,665)
755
249
(889)
156,963
160,336
19
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 MARCH
CONSOLIDATED
2019
Contributed
Equity
$’000
Notes
Reserves
$’000
Retained
earnings
$’000
Total
$’000
Opening balance at 1 April 2018
306,653
(170,550)
24,233
160,336
Change in accounting policy
Deferred tax impact on change in accounting policy
Restated total equity at 1 April 2018
Profit for the period
Movement in foreign currency translation reserve
Other comprehensive income for the period
Total comprehensive income (loss) for the period
Dividends Paid
Payments received on management incentive plan shares
Movement in share based payments reserve
Total transactions with owners, recognised directly in equity
1
1
3.4
5.2
6.3
–
–
–
–
306,653
(170,550)
–
–
–
–
–
40
–
40
–
(253)
(226)
(479)
–
–
(30)
(30)
Balance at 31 March 2019
306,693
(171,059)
(1,280)
375
23,328
5,042
-
-
5,042
(7,041)
-
-
(7,041)
21,329
(1,280)
375
159,431
5,042
(253)
(226)
4,563
(7,041)
40
(30)
(7,031)
156,963
CONSOLIDATED
2018
Notes
Contributed
$’000 Equity
Reserves
$’000
Retained
earnings
$’000
Total
$’000
Opening balance at 1 April 2017
304,950
(170,492)
22,037
156,495
Profit for the period
Movement in foreign currency translation reserve
Other comprehensive income (loss) for the period
Total comprehensive income (loss) for the period
Dividends Paid
Payments received on management incentive plan shares
Movement in share based payments reserve
5.2
6.3
Total transactions with owners, recognised directly in equity
–
–
–
–
–
1,703
–
1,703
–
(538)
106
(432)
–
–
374
374
Balance at 31 March 2018
306,653
(170,550)
The above statement of changes in equity should be read in conjunction with the accompanying notes.
16,278
16,278
–
–
(538)
106
16,278
15,846
(14,082)
(14,082)
–
–
(14,082)
24,233
1,703
374
(12,005)
160,336
20
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 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
Net cash outflow from investing activities
Cash flows from financing activities
Repayment of borrowings
Drawdown of borrowings
Payments received on management incentive plan shares
Dividend paid
Net cash inflow/(outflow) from financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at the beginning of the period
Effects of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at end of the period
The above statement of cash flows should be read in conjunction with the accompanying notes.
The table below sets out the reconciliation between net debt and cashflow:
Opening balance of bank borrowings at 1 April
Cashflows
Foreign exchange adjustments
Closing balance of bank borrowing at 31 March
Less: cash and cash equivalents
Plus: bank overdraft
Net debt at 31 March
CONSOLIDATED CONSOLIDATED
2019
$’000
2018
$’000
269,117
(231,190)
19
(5,327)
(8,970)
23,649
(7,088)
(718)
(7,806)
(1,146)
–
1,375
(7,041)
(6,812)
9,031
(3,497)
(46)
5,488
270,517
(224,582)
141
(4,679)
(7,759)
33,638
(19,967)
(590)
(20,557)
(3,000)
–
368
(14,082)
(16,714)
(3,633)
248
(112)
(3,497)
CONSOLIDATED CONSOLIDATED
2019
$’000
90,818
(1,146)
(840)
88,832
(5,488)
–
83,344
2018
$’000
94,736
(3,000)
(918)
90,818
(360)
3,857
94,315
21
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
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 for-profit entity for
financial reporting purposes
and has operations and sales in
New Zealand and Australia.
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 (NZSX) on 29 July
2014.
Basis of preparation
These consolidated financial
statements have been
approved for issue by the
Board of Directors on 23 May
2019.
The consolidated financial
statements of the group have
been prepared in accordance
with Generally Accepted
Accounting Practice in New
Zealand (NZ GAAP). The group
is a for-profit entity for the
purposes of complying with NZ
GAAP. The consolidated
financial statements comply
with New Zealand equivalents
to International Financial
Reporting Standards (NZ IFRS),
other New Zealand accounting
22
standards and authoritative
notices that are applicable to
entities that apply NZ IFRS. 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 Markets
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.
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 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
2019 and the results of all
subsidiaries for the period then
ended.
Subsidiaries are all entities
over which the Group has
control. It is a controlled entity
of Metro Performance Glass if
Metro Performance Glass is
exposed and has a right to
variable returns from the
entity and is able to use its
power over the entity to affect
those returns. 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.
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. They are
deferred in equity if they relate
to qualifying cash flow hedges
and qualifying net investment
hedges or are attributable to
part of the net investment in a
foreign operation.
The results and financial
position of foreign operations
that have a functional currency
different from the
presentation currency are
translated into the
presentation currency as
follows:
Intercompany transactions,
balances and unrealised gains
on transactions between Group
companies are eliminated.
Unrealised losses are also
eliminated unless the
transaction provided evidence
of the impairment of the asset
transferred.
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.
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.
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 • assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance
sheet
•
income and expenses for each statement of profit or loss and statement of comprehensive income are translated at
average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing
on the transaction dates, in which case income and expenses are translated at the dates of the transactions), and
• all resulting exchange differences are recognised in other comprehensive income.
CHANGES IN ACCOUNTING POLICY AND DISCLOSURES
New and amended standards adopted by the Group
A number of new standards become applicable for the current reporting period and the Group has changed its accounting
policies as a result of adopting the following standards:
•
•
IFRS 9 Financial Instruments
IFRS 15 Revenue from Contracts with Customers
The impact of the adoption of these new standards is disclosed below.
Changes in accounting policies
This note explains the impact of the adoption of IFRS 15 and IFRS 9 on the Group’s consolidated financial statements and
also discloses the new accounting policies that have been applied from 1 April 2018, where they are different to those
applied in prior periods.
IFRS 15 Revenue from Contracts with Customers – Impact of Adoption
The Group adopted IFRS 15 Revenue from Contracts with Customers for the first time from 1 April 2018. The Group applied
NZ IFRS 15 retrospectively with the cumulative effect of applying the standard for the first time recognised at the date of
initial application (1 April 2018).
The Group identified changes in the timing of revenue recognition as a result of the adoption of NZ IFRS 15 and accordingly
there was an adjustment of $0.04 million against opening retained earnings at 1 April 2018 for the cumulative effect of
revenue that would have been recognised in the prior period. This mainly relates to partial deliveries for the Retrofit and
Residential revenue channels for which the Group has an unconditional right to payment and where the Group recognise
revenue when the control has passed.
(a) Accounting Policies
Sales of goods
The Group derives revenue for the provision and assembly of customised glass products. Sales of goods are recognised at
a point in time 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. Revenue in the Retrofit and Residential revenue channels
are recognised in this manner.
Sales of supply and install services
The Group provides glazing services throughout the Metro Performance Glass branch network. For sales of supply and
glazing services, revenue is recognised over time, 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. Revenue in the
Commercial Glazing revenue channel is recognised over time.
(b) Presentation of the consolidated financial statements related to contracts with customers
A contract liability is recognised where a deposit is received on acceptance of a quote, as the deposit is fully refundable if
the contract does not go ahead. These were previously disclosed in Trade and other payables ($1.1m at 1 April 2018). This
liability mainly relates to our Retrofit revenue channel and is usually realised within two months.
23
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The following table illustrates the differences between the application of IFRS15 and as if the Group had continued to
account for relevant transactions during the year ended 31 March 2019 under legacy standards:
Sales Revenue
Cost of Sales
Opening Retained Earnings
Trade Receivables
Amount
recognised
under previous
revenue
recognition
policy
2019
$’000
267,607
(146,453)
–
–
Amount
recognised
under IFRS 15
2019
$’000
267,836
(146,517)
44
336
Difference
$’000
229
64
44
336
IFRS 15 requires the disaggregation of revenue to provide clear and meaningful information. For the Group, Management
concluded that presentation of revenue in terms of the geographical region and channel was most appropriate. This has
been presented in the Segment Information disclosure.
IFRS 9 Financial Instruments – impact of adoption
IFRS 9, as it relates to the Group, replaces the provisions of IAS 39 that relate to the recognition, classification,
measurement and impairment of financial assets and hedge accounting. The adoption of IFRS 9 from 1 April 2018 resulted in
changes in accounting policies and adjustments to the amounts recognised in the consolidated financial statements. The
new accounting policies are set out in the sections below, along with the impact on the consolidated financial statements.
The Group has applied IFRS 9 retrospectively, but has elected not to restate comparative information. As a result, the
comparative information provided continues to be accounted for in accordance with the Group’s previous accounting
policies.
Classification and measurement
From 1 April 2018, the Group classified its financial assets as being measured at amortised cost. These were previously
classified as loans and receivables. There was no change in measurement as a result of the reclassification. At initial
recognition, the group measures a financial asset at its fair value plus transactions costs that are directly attributable to
the acquisition of the financial asset. Subsequently, they are measured at amortised cost.
The Group has one type of financial asset that is subject to IFRS 9’s new expected credit loss model, that being Trade
Receivables.
The Group was required to revise its impairment methodology under IFRS 9 for Trade Receivables. The impact of the
change in impairment methodology on the Group’s retained earnings and equity is disclosed in the table below.
Impairment of financial assets
For trade receivables, the Group applies the simplified approach permitted by IFRS 9, which requires expected lifetime
credit losses to be recognised from initial recognition of the trade receivables.
Trade receivables are written off when there is no reasonable expectation of recovery. Indicators that there is no
reasonable expectation of recovery include, amongst others, the failure of a debtor to engage in a repayment plan with the
Group, and a failure to make contractual payments.
To measure expected credit losses, trade receivables have been grouped and reviewed on the basis of the number of days
past due. The expected credit loss allowance has been calculated by considering the impact of the following characteristics:
• The Baseline loss rate takes into account the write-off history of the Group over a five year period as a predictor of
future conditions and applies an increasing expected credit loss estimate by trade receivables aging profiles.
• The Market characteristic considers the relative risk related to any particular market segment and makes an assessment
of the indirect exposure the Group has in respect to this market segment’s conditions via our customer base. Of particular
focus with respect to this characteristic in the current period is the vertical construction market segment.
24
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 The expected credit loss allowance as at 1 April was determined as follows for trade receivables:
1 APRIL 2018
Gross carrying amount
Baseline
Market
Total expected credit loss rate
Expected credit loss allowance
Current
NZ$’000
24,786
136
191
1.32%
327
30-59 days
NZ$’000
60-89 days
NZ$’000
8,100
144
93
2.92%
237
1,187
96
5
8.51%
101
90 days
and later
NZ$’000
7,339
439
230
9.12%
669
TOTAL
NZ$’000
41,412
815
519
3.22%
1,334
The ageing profile of the Gross carrying amount 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 represents contractual retentions.
The expected credit loss allowance for trade receivables as at 31 March 2018, as reported in the Annual Report, reconciles to the opening
loss allowance on 1 April 2018 as follows:
Loss allowances for trade receivables
At 31 March 2018 – calculated under IAS 39
Impact of first time adoption of IFRS 9
Opening loss allowance as at 1 April 2018 – calculated under IFRS 9
NZ$’000
995
1,334
2,329
Over the period, the trade receivables position has improved resulting in a reduction in the expected credit loss allowance of $0.14m. This
amount was recognised during the period within the Statement of Comprehensive Income in Administration Expenses.
Impact of standards issued but not yet adopted by the Group
IFRS 16 Leases was issued in January 2016. It will result in almost all leases being recognised in the Statement of Financial Position, as the
distinction between operating leases and finance leases is removed. The standard is mandatory for reporting periods beginning on or
after 1 April 2019. The Group does not intend to adopt the standard before its mandatory effective date and intends to implement the
simplified transition approach as defined in the standard. The Group will not restate comparative amounts for the period prior to adoption.
NZ IFRS 16: Leases
NZ IFRS 16 Leases replaces NZ IAS 17 and is effective for annual periods commencing on or after 1 January 2019. It requires a lessee to
recognise a lease liability reflecting future lease payments and a ‘right-to-use asset’ for virtually all lease contracts. Included is an
optional exemption for certain short-term leases and leases of low-value assets for lessees. It will also result in changes in the Statement
of Comprehensive Income with an interest expense on the liability and depreciation of the asset replacing the rental expense.
The standard will affect primarily the accounting for the Group’s operating leases. As at the reporting date, the Group has non-cancellable
minimum operating lease commitments of $47.2m (refer note 6.6). On adoption, NZ IFRS 16 will have a significant impact on the Group’s
statement of financial position and statement of comprehensive income.
Management has developed a model to calculate the full quantitative effect of their current operating leases under NZ IFRS 16 as at 1
April 2019, being the date of adoption. The model requires management to make some key judgements including:
• The incremental borrowing rate used to discount lease assets and liabilities; and
• The lease term including potential rights of renewals.
As a result of the calculations and the application of judgement within the model, management is able to quantify the potential impact of
NZ IFRS 16 based on the current lease arrangements across the Group. Management expect that there will material impact across the
following line items in the statement of financial position:
• Recognition of a right-of-use asset of approximately $56.8 million;
• Recognition of a lease liability of approximately $64.7 million.
• Recognition of a deferred taxation asset of approximately $2.2 million.
• Decrease in opening retained earnings of approximately $3 million.
25
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NZ$m
7.2
(5.3)
(3.0)
(1.1)
The expected impact on the statement of comprehensive income for the period ended 31 March 2020 across the following
line items are estimated as follows:
Decrease in operating lease expense recognised within Cost of sales and Administration expenses
Increase in depreciation and amortization expense
Increase in finance costs (recognised as interest expense)
Decrease in profit before taxation
The above has no cash effect on the Group and the change is for financial reporting purposes only.
Current estimates are likely to change at time of adoption and for the period ending 31 March 2020, mainly due to:
• Finalisation of management’s judgements and subsequent movements in the inherent borrowing rate (interest rates);
• Change in management’s judgement to exercise rights of renewals under lease arrangements;
• Changes to existing lease contracts;
• Clarification of tax rules impacting the recognition of deferred tax assets; and
• New lease contracts entered into by the Group.
Changes in accounting disclosures
Certain comparatives have been restated in the Australian business to conform with the current year’s presentation and to
improve consistency across operating segments.
(a) The Group reclassified customer service costs amounting to $1.9m from Cost of sales to Selling and marketing expenses
to align group treatment.
(b) The Group reclassified dispatch labour amounting to $3.3m from Cost of sales and $0.6m from Administration expenses
to Distribution and glazing related expenses to align group treatment.
These changes have also been made to comparatives in the Segment Information note.
The following table shows the impact of these reclassifications with respect to 2018:
Note
(above)
Per 2018
Annual Report
Current
Disclosure
Difference
(a), (b)
(a), (b)
(b)
(a)
(b)
2018
$’000
(151,119)
117,174
(41,867)
(11,206)
(33,179)
28,000
2018
$’000
(145,844)
122,449
(45,854)
(13,137)
(32,536)
28,000
2018
$’000
5,275
5,275
(3,987)
(1,931)
643
–
Cost of Sales
Gross Profit
Distribution and glazing related expenses
Selling and marketing expenses
Administration expenses
Earnings before interest and tax
2 FINANCIAL PERFORMANCE
2.1 SEGMENT INFORMATION
Operating segments of the Group at 31 March 2019 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. This revenue is
split by channel only at the revenue level into Commercial, Residential and Retrofit. Commercial revenue reflects sales
through four specific commercial glazing operations in New Zealand. The allocation of sales between residential and
commercial can be difficult as the Group does not always know the end use application. Following the acquisition of AGG on 1
September 2016 the Group operates in two geographic segments, New Zealand and Australia.
26
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 In the tables below:
• Group costs consist of insurance, professional services, director fees and expenses, listing fees and share incentive scheme costs.
• Significant items related to impairment of intangible assets in AGG in 2019 and CEO departure and recruitment costs in 2018.
Commercial Glazing
Residential
Retrofit
Total revenue
Gross Profit
Segmental EBITDA before significant items
Group Costs
Group EBITDA before significant items
Depreciation and amortisation
EBIT before significant items
Significant items
EBIT
Segment Assets
Segment Non-current Assets (excluding Deferred tax assets)
Segment Liabilities
Commercial Glazing
Residential
Retrofit
Total revenue
Gross Profit
Segmental EBITDA before significant items
Group Costs
Group EBITDA before significant items
Depreciation and amortisation
EBIT before significant items
Significant items
EBIT
Segment Assets
Segment Non-current Assets (excluding Deferred tax assets)
Segment Liabilities
CONSOLIDATED 2019
New Zealand
$’000
Australia
$’000
Eliminations &
Other
$’000
52,462
143,136
21,836
217,434
110,261
41,972
–
10,885
31,087
–
31,087
285,958
170,186
28,965
–
50,402
–
50,402
11,058
(1,212)
–
3,574
(4,786)
(9,560)
(14,346)
57,509
40,837
54,347
–
–
–
–
–
–
(1,066)
–
(1,066)
–
(1,066)
(54,708)
–
48,484
CONSOLIDATED 2018
New Zealand
$’000
Australia
$’000
Restated (Note 1)
Eliminations &
Other
$’000
48,153
143,248
21,500
212,901
105,463
38,944
–
9,704
29,240
–
29,240
271,089
174,718
30,551
–
55,404
–
55,404
16,986
5,854
–
2,694
3,160
–
3,160
64,827
53,141
47,472
–
(12)
–
(12)
–
–
(1,478)
–
(1,478)
(2,922)
(4,400)
(35,129)
–
62,428
Group
$’000
52,462
193,538
21,836
267,836
121,319
40,760
(1,066)
39,694
14,459
25,235
(9,560)
15,675
288,759
211,023
131,796
Group
$’000
48,153
198,640
21,500
268,293
122,449
44,798
(1,478)
43,320
12,398
30,922
(2,922)
28,000
300,787
227,859
140,451
27
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) 2.2 REVENUE
Accounting Policy
Revenue comprises the value of the consideration received for the sale of goods and services, net of Goods and Services
Tax, rebates and discounts and after eliminating sales within the Group.
Sales of goods
The Group derives revenue for the provision and assembly of customised glass products. Sales of goods are recognised at a
point in time 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 supply and install services
The Group provides glazing services throughout the Metro Performance Glass branch network. For sales of supply and
glazing services, revenue is recognised over time, 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.
2.3 OPERATING EXPENDITURE
Raw materials and consumables used
Employee benefit expense
Subcontractor cost
Depreciation and amortisation
Transportation and logistics
Operating lease payments
Advertising
Other expenses
Total cost of sales, distribution and glazing related expenses, selling and marketing
expenses, and administration expenses
Audit and review of financial statements
Audit and review of financial statements – PwC
Other services performed by PwC
Agreed-upon procedures relating to covenant compliance certificate and annual report
Share Scheme advice
Executive reward services
CONSOLIDATED CONSOLIDATED
2019
$’000
72,212
99,337
6,684
14,459
10,357
10,528
1,858
27,166
2018
$’000
74,703
95,999
6,200
12,398
10,861
10,020
2,301
24,889
242,601
237,371
CONSOLIDATED CONSOLIDATED
2019
$’000
2018
$’000
300
11
56
19
386
296
11
4
16
327
28
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 2.4 SIGNIFICANT ITEMS
CEO departure and recruitment costs
Impairment of AGG Intangible assets
Total significant items before taxation
Tax benefit on above items
Total significant items after taxation
CONSOLIDATED CONSOLIDATED
2019
$’000
–
9,560
9,560
(384)
9,176
2018
$’000
2,922
–
2,922
(818)
2,104
Additional detail on impairment charges can be seen in the Intangible Assets note 4.2.
2.5 EARNINGS PER SHARE
Basic
Basic earnings per share is calculated by dividing the profit after tax of the Group by the weighted average number of
ordinary shares outstanding during the period.
Profit after tax ($’000)
Weighted average number of ordinary shares outstanding (‘000s)
Basic Earnings per share (cents per share)
CONSOLIDATED CONSOLIDATED
2019
5,042
185,378
2.7
2018
16,278
185,378
8.8
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.
Weighted average number of ordinary shares outstanding (‘000s)
Adjusted for share options (‘000s)
Weighted average number of ordinary shares for diluted earnings per share (‘000s)
Diluted Earnings per share (cents per share)
Net Tangible Assets
Net Tangible assets
Shares on issue at end of period (in thousands)
Net tangible assets per share (cents per share)
Net Tangible Assets consist of Net Assets less Intangible Assets.
CONSOLIDATED CONSOLIDATED
2019
185,378
–
2018
185,378
–
185,378
185,378
2.7
8.8
CONSOLIDATED CONSOLIDATED
2019
$’000
10,521
185,378
5.68
2018
$’000
849
185,378
0.46
29
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) 3 WORKING CAPITAL
3.1 TRADE RECEIVABLES
The following table summarises the impact of the expected credit loss provision on the trade receivables balance.
See Page 24 for more detail on the accounting policies that impact trade receivables.
Trade receivables
Expected credit loss provision
Bad and doubtful trade receivables
CONSOLIDATED CONSOLIDATED
2019
$’000
40,800
(1,961)
38,839
2018
$’000
41,412
(995)
40,417
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 ageing profile of debtors follows:
Current
30 – 59 days
60 – 89 days
90 days and later
CONSOLIDATED CONSOLIDATED
2019
$’000
25,189
6,629
1,852
7,130
40,800
2018
$’000
24,786
8,100
1,187
7,339
41,412
The ageing 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 represents contractual retentions.
Movements in the expected credit loss provision are as follows:
Opening balance
Impact of first time adoption of IFRS9
Provision for impairment recognised during the year
Receivables written off during the year as uncollectable
Balance at end of year
CONSOLIDATED CONSOLIDATED
2019
$’000
995
1,334
371
(739)
1,961
2018
$’000
978
–
407
(390)
995
Amounts are written off when there is no reasonable expectation of recovery. Indicators that there is no reasonable
expectation of recovery include, amongst others, the failure of a debtor to engage in a repayment plan with the Group, and
a failure to make contractual payments.
30
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 The expected credit loss allowance as at 31 March 2019 was determined as follows for trade receivables:
31 March 2019
Gross carrying amount
Baseline
Market
Specific
Total expected credit loss rate
Expected credit loss allowance
Estimates and judgements:
Current
30-59 days
60-89 days
90 days and
later
NZ$’000
25,189
135
120
–
1.01%
255
NZ$’000
NZ$’000
NZ$’000
6,629
1,852
136
33
–
2.55%
169
100
36
–
7.34%
136
7,130
414
224
763
19.65%
1,401
TOTAL
NZ$’000
40,800
785
413
763
4.81%
1,961
Expected credit loss provision
To measure expected credit losses, trade receivables have been grouped and reviewed on the basis of the number of days
past due. The expected credit loss allowance has been calculated by considering the impact of the following characteristics:
• The Baseline loss rate takes into account the write-off history of the Group over a five year period as a predictor of
future conditions and applies an increasing expected credit loss estimate by trade receivables aging profiles.
• The Market characteristic considers the relative risk related to any particular market segment and makes an
assessment of the indirect exposure the Group has in respect to this market segment’s conditions via our customer
base. Of particular focus with respect to this characteristic in the current period is the direct and indirect exposure to
the vertical construction market segment.
Under IAS 39, trade receivables were reduced by an allowance for amounts that may become uncollectable in the future,
based on any specific customer collection issues that were identified. Collections and payments from our customers are
continuously monitored and an expected credit loss provision is still maintained to cover any specific customer credit losses
anticipated.
Accounting Policy
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost, less provision for
estimated uncollectable amounts and expected credit losses. The carrying amount of the asset is reduced through the use
of provision accounts, 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. Trade receivables are also assessed for credit risk on a forward-looking
basis with a provision raised where a expected credit loss is considered likely.
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.
31
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) 3.2 INVENTORIES
Raw materials, primarily flat glass stock-sheets
Work in progress
CONSOLIDATED CONSOLIDATED
2019
$’000
20,497
2,437
22,934
2018
$’000
20,312
3,219
23,531
The cost of inventories recognised as an expense and included in ‘Cost of sales’ amounted to $72.2m.
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
Trade and other payables
CONSOLIDATED CONSOLIDATED
2019
$’000
19,939
7,349
886
189
923
2018
$’000
20,594
8,893
1,193
411
240
29,286
31,331
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial period
which are unpaid. The carrying amount represents fair value due to their short term nature.
Employee Entitlements
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.
32
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 3.4 FINANCIAL
INSTRUMENTS
FINANCIAL
INSTRUMENTS
Management determines the
classification of the Group’s
financial liabilities at initial
recognition. The Group’s
financial liabilities for the
periods covered by these
consolidated financial
statements consists of
overdrafts, loans, trade and
other payables, interest rate
swaps and forward exchange
contracts.
The Group measures all
financial liabilities, with the
exception of interest rate
swaps and forward exchange
contracts, at amortised cost.
Interest rate swaps and
forward exchange contracts
are measured at fair value with
changes in fair value
recognised in other
comprehensive income.
Financial liabilities measured at
amortised cost are non-
derivative financial liabilities
with fixed or determinable
payments that are not quoted
in an active market. Trade and
other payables, bank
overdrafts and loans are
classified as financial liabilities
measured at amortised cost.
Fair value measurement
of financial assets and
liabilities
The Group’s financial assets
and liabilities by category are
summarised as follows:
Cash and cash equivalents
These are short term in nature
and their carrying value is
equivalent to their fair value.
Trade and other receivables
These assets are short term in
nature and are reviewed for
impairment; their carrying value
approximates their fair value.
Trade payables and Borrowings
Trade payables and borrowings
are measured at amortised
cost. The fair value of trade
and other payables
approximates carrying value
due to their short term nature.
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.
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), 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 and
interest rate swaps 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.
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 2019 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
Westpac Banking Corporation
and Bank of New Zealand as at
31 March 2019.
33
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The Group’s cashflow hedging reserves relate to the following hedging instruments:
Opening balance 1 April 2018
Change in fair value of hedging instrument recognised in OCI
Deferred tax
Balance at 31 March 2019
CONSOLIDATED 2019
Spot component
of currency
forwards
Interest rate
swaps
Total hedge
reserve
$’000
$’000
219
11
–
230
670
299
(84)
885
$’000
889
310
(84)
1,115
The effects of the foreign currency related hedging instruments on the group’s financial position and performance are as follows:
Foreign currency forwards
Carrying amount (liability)
Notional amount
Maturity date
Hedge ratio*
Change in discounted spot value of outstanding hedging instruments since 1 April
Change in value of hedged item used to determine hedge effectiveness
Weighted average hedged EUR/NZD rate for the year (including forward points)
Weighted average hedged USD/NZD rate for the year (including forward points)
Weighted average hedged EUR/AUD rate for the year (including forward points)
Weighted average hedged USD/AUD rate for the year (including forward points)
CONSOLIDATED CONSOLIDATED
2019
$’000
(315)
36,331
2018
$’000
(304)
25,169
Apr19-Mar20
Apr18-Mar19
1:1
11
(11)
0.5728
0.6816
0.6239
0.7205
1:1
(177)
177
0.5897
0.7035
–
–
* The foreign currency forwards are denominated in the same currency as the highly probably future inventory purchases (USD and EUR), therefore the hedge is 1:1.
The effects of the interest rate swaps on the group’s financial position and performance are as follows:
Interest rate swaps
Carrying amount (liability)
Notional amount
Maturity date
Hedge ratio
Change in fair value of outstanding hedging instruments since 1 April
Change in value of hedged item used to determine hedge effectiveness
CONSOLIDATED CONSOLIDATED
2019
$’000
(1,229)
39,255
2018
$’000
(930)
33,150
Aug19–Aug23
Au18–Aug23
1:1
299
(299)
1:1
30
(30)
Weighted average hedged rate for the year
43.20%
37.30%
34
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 Financial Instruments by category
Assets as per statement of financial position
Cash and cash equivalents
Derivatives – foreign exchange contracts
Derivatives – interest rate swaps
Trade and other receivables
Balance at 31 March 2019
Assets as per statement of financial position
Cash and cash equivalents
Derivatives – foreign exchange contracts
Derivatives – interest rate swaps
Trade and other receivables
Balance at 31 March 2018
Liabilities as per statement of financial position
Cash and cash equivalents
Trade and other payables excluding non-financial liabilities
Provisions
Derivatives – foreign exchange contracts
Derivatives – interest rate swaps
Interest bearing liabilities
Balance at 31 March 2019
CONSOLIDATED 2019
Assets at
amortised cost
$’000
Derivatives used
for hedging
$’000
5,488
–
–
38,839
44,327
–
172
–
–
172
CONSOLIDATED 2018
Assets at
amortised cost
$’000
Derivatives used
for hedging
$’000
360
–
–
40,417
40,777
–
–
–
–
–
CONSOLIDATED 2019
Liabilities at
amortised cost
$’000
Derivatives used
for hedging
$’000
–
27,548
3,877
–
–
88,832
120,257
–
–
–
487
1,229
–
1,716
Total
$’000
5,488
172
–
38,839
44,499
Total
$’000
360
–
–
40,417
40,777
Total
$’000
–
27,548
3,877
487
1,229
88,832
121,973
35
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Liabilities as per statement of financial position
Cash and cash equivalents
Trade and other payables excluding non-financial liabilities
Provisions
Derivatives - foreign exchange contracts
Derivatives - interest rate swaps
Interest bearing liabilities
Balance at 31 March 2018
Accounting policy
CONSOLIDATED 2018
Liabilities at
amortised cost
$’000
Derivatives used
for hedging
$’000
3,857
29,313
4,214
–
–
90,818
128,202
–
–
304
930
–
1,234
Total
$’000
3,857
29,313
4,214
304
930
90,818
129,436
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 the 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 to a
maximum period of 12 months with allowable limits of coverage up to 100% over the 6 month term, reducing to 50% up to
the 12 month term. Where deemed acceptable by the directors, coverage can be extended out over a longer period.
36
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 Exposure to foreign exchange risk
31 March 2019
Cash and cash equivalents
Trade receivables
Trade accounts payable
Balance at 31 March 2019
31 March 2018
Cash and cash equivalents
Trade receivables
Trade accounts payable
Balance at 31 March 2018
CONSOLIDATED 2019
AUD
NZ$’000
USD
NZ$’000
EUR
NZ$’000
1,467
7,391
(4,570)
4,288
–
–
(4,518)
(4,518)
–
–
(1,024)
(1,024)
CONSOLIDATED 2018
AUD
NZ$’000
USD
NZ$’000
EUR
NZ$’000
(3,857)
8,345
(5,359)
(871)
–
–
(3,216)
(3,216)
–
–
(1,104)
(1,104)
Cash flow hedge reserve movement shown in the statement of comprehensive income reflects the tax affected change in fair value of
forward foreign exchange currency contracts during the reporting period.
Sensitivity analysis
The following table details the Group’s sensitivity to a 10% strengthening/weakening of the New Zealand dollar (NZ$) 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 NZ$ against:
AUD
USD
EUR
10% weakening of the NZ$ against:
AUD
USD
EUR
CONSOLIDATED CONSOLIDATED
2019
$’000
2018
$’000
(390)
411
93
476
(502)
(114)
79
292
100
(97)
(357)
(123)
37
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Equity
10% strengthening of the NZ$ against:
USD
EUR
10% weakening of the NZ$ against:
USD
EUR
CONSOLIDATED CONSOLIDATED
2019
$’000
2018
$’000
(1,905)
(419)
2,328
512
(1,668)
(593)
2,038
725
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.
38
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 4. LONG TERM ASSETS
4.1 PROPERTY, PLANT AND EQUIPMENT
Opening balance
Cost
Accumulated depreciation
Net book value at 1 April 2018
Additions
Disposals
Depreciation expense
Foreign exchange impact
Closing net book value at 31 March 2019
Represented by:
Cost
Accumulated depreciation
Net book value at 31 March 2019
Opening balance
Cost
Accumulated depreciation
Net book value at 1 April 2017
Additions
Disposals
Depreciation expense
Foreign exchange impact
Closing net book value at 31 March 2018
Represented by:
Cost
Accumulated depreciation
Net book value at 31 March 2018
CONSOLIDATED 2019
Plant &
equipment
$’000
Furniture,
fittings &
equipment
$’000
Motor Vehicles
$’000
77,765
(17,743)
60,022
4,093
(64)
(8,141)
(263)
55,647
81,403
(25,756)
55,647
3,027
(1,935)
1,092
253
(22)
(543)
–
780
3,258
(2,478)
780
12,450
(5,192)
7,258
3,369
(252)
(2,211)
(10)
8,154
15,061
(6,907)
8,154
CONSOLIDATED 2018
Plant &
equipment
$’000
Furniture,
fittings &
equipment
$’000
Motor Vehicles
$’000
59,681
(12,385)
47,296
18,996
(117)
(5,922)
(231)
60,022
77,765
(17,743)
60,022
2,833
(1,231)
1,602
196
–
(706)
–
1,092
3,027
(1,935)
1,092
11,482
(3,338)
8,144
1,328
(199)
(1,999)
(16)
7,258
12,450
(5,192)
7,258
Total
$’000
93,242
(24,870)
68,372
7,715
(338)
(10,895)
(273)
64,581
99,722
(35,141)
64,581
Total
$’000
73,996
(16,954)
57,042
20,520
(316)
(8,627)
(247)
68,372
93,242
(24,870)
68,372
39
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) 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 expected useful lives. The rates are as follows:
Depreciation
Rate
Depreciation
Basis
7.5–15%
7.5–15%
12–20%
Straight Line
Straight Line
Straight Line
20–25%
Straight Line
Total
$’000
169,794
(10,307)
159,487
721
–
(3,564)
(9,560)
(642)
8,447
(4,317)
4,130
141
–
(1,897)
–
(23)
2,351
146,442
8,534
(6,183)
2,351
169,828
(23,386)
146,442
CONSOLIDATED 2019
Customer
relationships
$’000
Goodwill on
acquisitions
$’000
Computer
software
$’000
13,002
(5,990)
7,012
–
–
(1,667)
(1,270)
33
4,108
12,962
(8,854)
4,108
148,345
–
148,345
580
–
–
(8,290)
(652)
139,983
148,332
(8,349)
139,983
Leasehold Improvements
Plant and equipment
Motor Vehicles
Furniture, fixtures and fittings
4.2 Intangible Assets
Opening balance
Cost
Accumulated amortisation
Net book value at 1 April 2018
Additions
Disposals
Amortisation expense
Impairment
Foreign exchange impact
Closing net book value at 31 March 2019
Represented by:
Cost
Accumulated amortisation
Net book value at 31 March 2019
40
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 Opening balance
Cost
Accumulated amortisation
Net book value at 1 April 2017
Additions
Disposals
Amortisation expense
Foreign exchange impact
Closing net book value at 31 March 2018
Represented by:
Cost
Accumulated amortisation
Net book value at 31 March 2018
CONSOLIDATED 2018
Customer
relationships
$’000
Goodwill on
acquisitions
$’000
Computer
software
$’000
13,063
(4,122)
8,941
–
–
(1,875)
(54)
7,012
13,002
(5,990)
7,012
149,198
–
149,198
53
–
–
(906)
148,345
148,345
–
148,345
7,995
(2,431)
5,564
537
–
(1,896)
(75)
4,130
8,447
(4,317)
4,130
Total
$’000
170,256
(6,553)
163,703
590
–
(3,771)
(1,035)
159,487
169,794
(10,307)
159,487
During the period ended 2019, the Group made the final payment as stipulated in the sale and purchase agreement of
Southland Glass, adding $0.6m to the value of goodwill in respect of that acquisition in 2017.
Estimates and judgements: Goodwill
The Group tests at least 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
Post the acquisition of AGG segments have been classified as being New Zealand and Australia aligning with the way our
business is reviewed. Goodwill is allocated as follows:
New Zealand
Australia
CONSOLIDATED CONSOLIDATED
2019
$’000
117,379
22,604
139,983
2018
$’000
116,799
31,546
148,345
The value-in-use calculation uses pre-tax cash flow projections based on financial projections 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 revenue growth - 5 years
Long term growth rate
Discount rate
CONSOLIDATED
CONSOLIDATED
2019
2018
New Zealand
Australia
New Zealand
Australia
0.5%
2.0%
9.9%
6.9%
2.0%
9.9%
(1.1%)
2.5%
9.5%
7.5%
2.5%
9.5%
41
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) The Directors have completed an assessment of the carrying value of goodwill using a value-in-use basis to determine the
recoverable amount consistent with the approach taken by the Group in its consolidated financial statements for the year
ended 31 March 2018.
During the year ended 31 March 2019, operational challenges impacted the financial performance in the Australian cash
generating unit (CGU). This has impacted the cashflow forecasts which support the carrying value of the Australian CGU,
and as a result an impairment of goodwill of $8.3m has been recognised in respect of the Australian CGU in the consolidated
financial statements for the year. The recoverable value of the Australian CGU amounts to $45.5m based on a value-in-use
calculation.
The major plant installations in Australia during early 2018 significantly disrupted the company’s operations over the last 15
months. This was compounded by high levels of staff turnover. While a number of operational and staffing initiatives have
been implemented through the year and operational performance has improved, these changes take time to flow through to
the financial results, leading to a reassessment of the near term cash generation in the Australian CGU.
Additionally, the Directors have taken into account Housing Industry Association and other forecasts of construction
activity which indicate that further declines in housing starts are expected, particularly in multi-residential inner-city
demand. AGG primarily services the new detached housing construction and alterations and additions markets that have
historically been more stable, however they are expected to also decline to some degree in the future.
The most sensitive assumption in the assessment of our value-in-use calculation for the Australian CGU is compound
annual revenue growth. We still see considerable opportunity in Australia as continuing legislative changes drive an increase
in the demand for high quality double glazed windows, as we have seen awareness and penetration increasing in Victoria and
Tasmania on the back of this. Consequently our future projections are based on an assumed growth in the size of the
market for double glazed units in South Eastern Australia resulting in increased sales of these products. If this increase in
demand does not eventuate or we are unable to increase our production, a further evaluation of goodwill may be required.
The discount rate (post tax) represents the current market assessment of the risks specific to the CGU, taking into
account the time value of money and individual risks of the underlying assets that have not been incorporated in the
cashflow estimates. The discount rate calculation is based on the specific circumstances of the Group and its operating
segments and is derived from its weighted average cost of capital (WACC).
The long term growth rate is based on long term population growth rates in New Zealand and Australia and the increased
use and prevalence of glass products in our markets.
Sensitivity to changes in key assumptions
The following summarises the effect of a change in the key assumptions for the Australian CGU, with all other assumptions
remaining constant:
Base assumption
+1.0% in the 5 year compound annual revenue growth rate
-1.0% in the 5 year compound annual revenue growth rate
+0.5% Discount rate
-0.5% Discount rate
+0.25% Long term growth rate
-0.25% Long term growth rate
Impairment
Variance to base
assumption
$’000
(8,290)
6,290
(21,177)
(11,326)
(4,976)
(7,035)
(9,593)
$’000
–
14,580
(12,887)
(3,036)
3,314
1,255
(1,303)
Sensitivity analyses performed by management indicate no impairment to the goodwill associated with the New Zealand CGU.
Impairment tests for Customer Relationships
The Group also reviewed the valuation for the Customer Relationships intangible asset. The valuation model applies an
excess earnings approach. The Group reviewed this valuation with respect to EBIT, net operating assets and updated
customer churn data. This assessment has resulted in an impairment of $1.3m being recognised in the consolidated financial
statements with respect to the Customer Relationships asset within Australian Glass Group, this being the total of the
asset value.
42
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 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
anticipate 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
relationships 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 in New Zealand.
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 group 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
43
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) 5. DEBT & EQUITY
5.1 INTEREST BEARING LIABILITIES
Bank borrowings
Bank overdraft
CONSOLIDATED CONSOLIDATED
2019
$’000
88,832
–
88,832
2018
$’000
90,818
3,857
94,675
Bank borrowings are secured by a first-ranking composite general security deed. The Group’s bank borrowing facilities
comprise a syndicated term loan facility of $120m negotiated on 31 August 2018 for a 3 year term as well as overdraft and
bank guarantees totalling $9.748m. 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 through shares held of
various subsidiaries.
(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.
The table below sets out an analysis of the movements in borrowings due after one year.
Opening balance at 1 April
Cashflows
Foreign exchange adjustments
Closing balance at 31 March
Accounting policy
CONSOLIDATED CONSOLIDATED
2019
$’000
90,818
(1,146)
(840)
88,832
2018
$’000
94,736
(3,000)
(918)
90,818
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured
at amortised cost. 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.
44
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 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 negotiated a syndicated credit facility with banking partners in August 2018. As at
31 March 2019 the Group had cash of $5.5m. Information in respect of negotiated credit facilities is shown below.
CONSOLIDATED CONSOLIDATED
Committed credit facilities pursuant to syndicated facility
Drawdown at balance date
Available credit facilities
2019
$’000
129,748
(92,362)
37,386
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.
CONSOLIDATED 2019
Less than
1 year
$’000
Between 1
and 2 years
$’000
Between 2
and 5 years
$’000
> 5 years
$’000
Bank borrowings and interest owing
Interest rate swap
Foreign exchange contracts
Trade accounts payable
Total at 31 March 2019
2,981
173
487
19,939
23,580
2,793
274
–
–
90,002
782
–
–
3,067
90,784
CONSOLIDATED 2018
–
–
–
–
–
Bank borrowings and interest owing
Interest rate swap
Foreign exchange contracts
Trade accounts payable
Total at 31 March 2018
Interest rate risk
Less than
1 year
$’000
Between 1
and 2 years
$’000
Between 2
and 5 years
$’000
> 5 years
$’000
6,986
11
304
20,594
27,895
91,957
443
–
–
92,400
–
476
–
–
476
–
–
–
–
–
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 both New Zealand and
Australian dollars. If interest rates in New Zealand and Australia increased by 10% the impact would be additional cost of
$279k and a subsequent decrease of $279k if rates decreased by 10%. (2018 interest rate increase of 10% would have
resulted in additional costs of $272k and a subsequent decrease of $272k if rates decreased by 10%)
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.
2018
$’000
141,382
(95,591)
45,791
Total
$’000
95,776
1,229
487
19,939
117,431
Total
$’000
98,943
930
304
20,594
120,771
45
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) 5.2 Contributed equity
Opening balance
Payments received on management incentive plans
Closing balance
CONSOLIDATED CONSOLIDATED
2019
$’000
306,653
40
306,693
2018
$’000
304,950
1,703
306,653
On 29 July 2014, Metro Performance Glass 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. 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. Additionally, as part of the then long term incentive plan 4,714,784 ordinary shares were issued to
management and these vested on 20 July 2015. Payments received on management incentive plan shares relates to net
proceeds received or receivable from management under this scheme.
On 21 February 2017, Metroglass launched an employee share purchase scheme for New Zealand employees. This Scheme
enabled participants to purchase either $1,000 or $2,000 worth of Metroglass shares at a 50% discount to market value.
Shares are held in trust on behalf of the participants for a minimum three year holding period until the vesting date of 21
February 2020. Vesting conditions include ongoing employment with the Company as at the vesting date. The Company has
provided participants with interest free loans to fund the participant contribution (being 50%) towards the acquisition of
the shares, which is to be repaid over the three year holding period. In aggregate, 348,086 shares were issued under this
Scheme on 21 February 2017 at an issue price of $1.54.
Long Term Incentive Plans
The Group currently has a long term incentive plan for selected employees. The plan participants are members of the senior
leadership team and other selected senior managers.
The plan is designed to secure those employees’ retention in Metro Performance Glass and to reward performance that
underpins the achievement of Metro Performance 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
Performance Glass (in accordance with the plan rules).
The performance rights enable participants to acquire shares in Metro Performance 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 Performance 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 vesting date, retesting will be permitted after a
further six and twelve months from the measurement date.
The below share options and performance share rights have been issued.
Date Issued
10-Jun-16
25-May-17
24-May-18
Number of Options
Number of PSR
Options Exercise Price
Vesting Date
532,266
1,351,344
1,942,534
127,950
337,784
609,421
$1.73
$1.35
$0.89
10-Jun-19
25-May-20
7-Jun-21
46
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 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.
Metro Performance Glass paid fully imputed dividends of 3.8 cents per share in 2019 (7.6 cents per share in 2018)
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 2019 was as follows:
Bank borrowings
Less: cash and cash equivalents
Plus: bank overdraft
Net debt
Equity
Gearing ratio
CONSOLIDATED CONSOLIDATED
2019
$’000
88,832
(5,488)
–
83,344
2018
$’000
90,818
(360)
3,857
94,315
156,963
160,336
34.7%
37.0%
47
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) 6. OTHER
6.1 INCOME TAXATION
Profit before income taxation
Income taxation expense at the Group’s effective tax rate
Tax effect of non-deductible items
Non assessable income
Prior year adjustment
Income tax expense
Represented by:
Current taxation
Deferred taxation
Imputation Credit Account
CONSOLIDATED CONSOLIDATED
2019
$’000
10,589
2,640
2,737
–
170
5,547
8,438
(2,891)
5,547
2018
$’000
23,334
6,561
215
–
280
7,056
7,381
(325)
7,056
The amount of imputation credits at balance date available for future distributions is $12.4m at 31 March 2019, $6.8m at 31 March 2018.
6.2 DEFERRED TAXATION
Consolidated deferred tax assets and liabilities are attributable to the following;
Property, plant & equipment
Inventory and receivables
Cash flow hedge
Intangibles
Provisions and accruals
Tax losses
Property, plant & equipment
Inventory and receivables
Cash flow hedge
Intangibles
Provisions and accruals
48
CONSOLIDATED
2019
Assets
$’000
Liabilities
$’000
–
–
513
–
2,863
1,582
4,958
Assets
$’000
–
74
346
–
2,663
3,083
(740)
–
–
(1,207)
–
(1,947)
CONSOLIDATED
2018
Liabilities
$’000
(1,006)
–
–
(2,508)
–
(3,514)
Net
$’000
(740)
–
513
(1,207)
2,863
1,582
3,011
Net
$’000
(1,006)
74
346
(2,508)
2,663
(431)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 Movement in temporary differences during the year;
Property, plant & equipment
Inventory and receivables
Cash flow hedge
Intangibles
Provisions and accruals
Tax losses
Property, plant & equipment
Inventory and receivables
Cash flow hedge
Intangibles
Provisions and accruals
CONSOLIDATED 2019
Opening
Balance
$’000
(1,006)
74
346
(2,508)
2,663
–
(431)
Recognised
in Opening
Retained
Earnings*
$’000
–
–
–
–
375
–
375
Recognised in
profit or loss
$’000
Recognised
in OCI
$’000
Balance
31 Mar 2018
$’000
260
(74)
–
1,288
(165)
1,582
2,891
6
–
167
13
(10)
–
176
(740)
–
513
(1,207)
2,863
1,582
3,011
CONSOLIDATED 2018
Opening
Balance
$’000
Arising on
acquisition
$’000
Recognised in
profit or loss
$’000
Recognised
in OCI
$’000
Balance
31 Mar 2017
$’000
(973)
64
387
(3,135)
2,958
(699)
–
–
–
–
–
–
(42)
11
–
603
(247)
325
9
(1)
(41)
24
(48)
(56)
(1,006)
74
346
(2,508)
2,663
(431)
* Deferred tax impact on change in accounting policy. Refer to Note 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. No deferred tax liability was recognised on
initial recognition of goodwill. Deferred income tax is determined using tax rates (and laws) that have been enacted or
substantively enacted by the statement of financial position 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 for unused tax losses and deductible temporary differences to the extent that
it is probable that future taxable profit will be available against which they can be utilised. Deferred tax assets are reviewed
at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be
realised.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right 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.
49
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) 6.3 GROUP RESERVES
Group Reorganisation Reserve
Upon acquisition of Metroglass Holdings Limited in July 2014, 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.
Share Based Payments 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
Movement in share based payments reserve
Closing Balance
6.4 RELATED PARTY TRANSACTIONS
Subsidiaries
CONSOLIDATED CONSOLIDATED
2019
$’000
755
(30)
725
2018
$’000
381
374
755
The Group’s principal subsidiaries at 31 March 2019 are set out below. Unless otherwise stated, they have share capital
consisting solely of ordinary shares that are held directly by the group, and the proportion of ownership interest held equals
the voting rights held by the group. The country of incorporation or registration is also their principal place of business.
Name of entity
Country of incorporation
2019 Interest
2018 Interest
Metropolitan Glass & Glazing Limited
Metroglass Finance Limited
Australian Glass Group Holding Pty
Australian Glass Group Finance Pty
Directors
New Zealand
New Zealand
Australia
Australia
100%
100%
100%
100%
100%
100%
100%
100%
The names of persons who were directors of the Company at any time during the financial period are as follows: Peter
Griffiths, Russell Chenu, Willem Roest, Gordon Buswell, Angela Bull and Rhys Jones.
50
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 Key management and Board of Directors compensation
Key management are members of the Executive Team. The compensation paid to key management for employee service is
shown below.
CONSOLIDATED CONSOLIDATED
2019
$’000
2,967
48
94
–
3,109
2018
$’000
3,009
290
269
2,731
6,299
CONSOLIDATED CONSOLIDATED
2019
$’000
605
605
2018
$’000
595
595
Salaries and other short-term employee benefits
Management incentive
Share based payments
Post employment benefit
Board of Directors’ compensation
Directors fees
6.5 CONTINGENCIES
At 31 March 2019 the Group had no contingent liabilities or assets.
6.6 COMMITMENTS
Lease commitments; as lessee.
Operating leases
The Group leases all premises. 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.
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
Accounting Policy
CONSOLIDATED CONSOLIDATED
2019
$’000
2018
$’000
9,188
7,121
12,001
18,884
47,194
9,435
8,891
15,078
22,226
55,630
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.
51
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Independent auditor’s report
To the shareholders of Metro Performance Glass Limited
We have audited the consolidated financial statements which comprise:
the consolidated statement of financial position as at 31 March 2019;
the consolidated statement of comprehensive income for the year then ended;
the consolidated statement of changes in equity for the year then ended;
the consolidated statement of cash flows for the year then ended; and
the notes to the consolidated financial statements, which include significant accounting policies.
Our opinion
In our opinion, the accompanying consolidated financial statements of Metro Performance Glass
Limited (the Company), including its subsidiaries (the Group), present fairly, in all material respects,
the financial position of the Group as at 31 March 2019, its financial performance and its cash flows for
the year then ended in accordance with New Zealand Equivalents to International Financial Reporting
Standards (NZ IFRS) and International Financial Reporting Standards (IFRS).
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand) (ISAs
(NZ)) and International Standards on Auditing (ISAs). Our responsibilities under those standards are
further described in the Auditor’s responsibilities for the audit of the consolidated financial
statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
We are independent of the Group in accordance with Professional and Ethical Standard 1 (Revised)
Code of Ethics for Assurance Practitioners (PES 1) issued by the New Zealand Auditing and Assurance
Standards Board and the International Ethics Standards Board for Accountants’ Code of Ethics for
Professional Accountants (IESBA Code), and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
Our firm carries out other services for the Group in the areas of agreed upon procedures relating to
covenant compliance certificate and annual report, share scheme advice and executive reward services.
The provision of these other services has not impaired our independence as auditor of the Group.
PricewaterhouseCoopers, 188 Quay Street, Private Bag 92162, Auckland 1142, New Zealand
T: +64 9 355 8000, F: +64 9 355 8001, pwc.co.nz
52
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 Our audit approach
Overview
An audit is designed to obtain reasonable assurance whether the financial
statements are free from material misstatement.
Overall Group materiality: $1.0 million, which represents approximately
5% of profit before tax, adjusted to exclude the total impairment charge of
$9.6 million relating to the Australian Glass Group Cash Generating Unit’s
intangible assets.
We have determined that there are two key audit matters:
Goodwill impairment assessment
Revenue recognition
Materiality
The scope of our audit was influenced by our application of materiality.
Based on our professional judgement, we determined certain quantitative thresholds for materiality,
including the overall Group materiality for the consolidated financial statements as a whole as set out
above. These, together with qualitative considerations, helped us to determine the scope of our audit,
the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, both
individually and in aggregate on the consolidated financial statements as a whole.
Audit scope
We designed our audit by assessing the risks of material misstatement in the consolidated financial
statements and our application of materiality. As in all of our audits, we also addressed the risk of
management override of internal controls including among other matters, consideration of whether
there was evidence of bias that represented a risk of material misstatement due to fraud.
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an
opinion on the consolidated financial statements as a whole, taking into account the structure of the
Group, the accounting processes and controls, and the industry in which the Group operates.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the consolidated financial statements of the current year. These matters were addressed in
the context of our audit of the consolidated financial statements as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on these matters.
PwC
53
Key audit matter
Goodwill impairment assessment
How our audit addressed the key audit matter
We undertook the following procedures:
Total goodwill at 31 March 2019 amounts to
$140.0 million and represents 48% of total
assets. As disclosed in Note 4.2 of the
consolidated financial statements, goodwill of
$116.8 million relates to the acquisition of
Metro Performance Glass (MPG) in FY2015
and $31.5 million relates the acquisition of
Australian Glass Group (AGG) in FY2017. An
impairment charge of $8.3 million has been
recorded against AGG goodwill in the current
financial year.
Management utilised the value in use
methodology to estimate the value of the cash
generating units (CGUs) using discounted
cash flows and this value was used in the
impairment assessment of the goodwill for
each CGU. The determination of the value in
use of each CGU is complex and includes key
estimates and assumptions made by
management, particularly in the following
areas:
The determination that there are two
CGUs being the New Zealand business
and the Australian business (see Note 2.1
of the consolidated financial statements).
Expected future compound revenue
growth rates.
The determination of the appropriate
discount rate used in the model being a
post-tax rate of 9.9% for both New
Zealand and Australia.
The estimated long term growth rate -
management has applied a rate of 2.0%
for both New Zealand and Australia.
A sensitivity assessment was performed on
the key assumptions using reasonably
possible scenarios and assessing the impact
on the value of the CGUs.
Refer to note 4.2 in the consolidated financial
statements for further information.
Considered management’s identification of
CGUs by gaining an understanding of the
business and how it is managed.
Tested the mathematical accuracy of the
value in use calculations and comparing
these to the relevant carrying value of the
CGUs.
Assessed the reasonableness of the key
estimates and assumptions below by
comparing:
-
-
-
Revenue growth to historic performance
of each CGU.
the long term growth rate to the long
term inflation forecasts.
the discount rate to similar companies in
the building materials market.
Assessed the reasonableness of gross profit
margin, operating expenses, EBITDA
growth, CAPEX and working capital
assumptions to historic performance of each
CGU.
We engaged an auditor’s expert to review the
carrying value, the discount rate and the long
term growth rate used in the model.
Performed sensitivity analysis in particular
to the compound annual revenue growth
rates, the discount rate and the long term
growth rate, using reasonably possible
scenarios to see if there is any material
impact on the value of the CGUs.
Reviewed the disclosure in the financial
statements to ensure that this is compliant
with the requirements of the accounting
standards.
From our procedures, no material exceptions
were noted.
PwC
54
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 Key audit matter
Revenue recognition
How our audit addressed the key audit matter
Our audit procedures included:
The Group’s revenue primarily consists of the
sale of goods, which totalled $267.8 million in
the year to 31 March 2019, and is the most
significant item in the Group’s financial
statements and therefore requires significant
audit effort.
There is complexity in the revenue business
process due to the high level of manual
interactions. This also heightens the potential
for management override through posting of
inappropriate journal entries to revenue.
Management undertook an analysis for the first
time adoption of IFRS 15 and identified changes
in the timing of revenue recognition with a
cumulative impact of $0.04 million in opening
retained earnings as of 01 April 2018.
Evaluating the processes and controls in
place over the recording of sales revenue.
For a sample of revenue transactions
throughout the year, we obtained evidence
that the transactions were valid and
recognised in the correct financial year. We
validated that the date on which revenue was
recognised was appropriate by examining:
-
-
-
-
The associated invoice
The terms of the sales contract
The relevant proof of revenue
occurrence
For the sample of transactions, we
obtained a confirmation of the amount
from the customer, or evidence that the
amount was received by the Group
subsequent to year-end.
For a sample of journals posted to revenue
throughout the year, we obtained evidence
that journals were appropriate by agreeing
them to supporting documentation.
Assessing management’s assessment of the
impact of IFRS 15 by reviewing contracts
with customers for the different revenue
channels on a sample basis and testing the
disclosure in the financial statements.
From our procedures, no material exceptions
were noted.
Information other than the financial statements and auditor’s report
The Directors are responsible for the annual report. Our opinion on the consolidated financial
statements does not cover the other information included in the annual report and we do not express
any form of assurance conclusion on the other information.
In connection with our audit of the consolidated financial statements, our responsibility is to read the
other information and, in doing so, consider whether the other information is materially inconsistent
with the consolidated financial statements or our knowledge obtained in the audit, or otherwise
appears to be materially misstated. If, based on the work we have performed on the other information
that we obtained prior to the date of this auditor’s report, we conclude that there is a material
misstatement of this other information, we are required to report that fact. We have nothing to report
in this regard.
Responsibilities of the Directors for the consolidated financial statements
The Directors are responsible, on behalf of the Company, for the preparation and fair presentation of
the consolidated financial statements in accordance with NZ IFRS and IFRS, and for such internal
PwC
55
control as the Directors determine is necessary to enable the preparation of consolidated financial
statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the Directors are responsible for assessing the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the Directors either intend to liquidate
the Group or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the consolidated financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial
statements, as a whole, are free from material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance,
but is not a guarantee that an audit conducted in accordance with ISAs (NZ) and ISAs will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these consolidated financial statements.
A further description of our responsibilities for the audit of the financial statements is located at the
External Reporting Board’s website at:
https://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/audit-
report-1/
This description forms part of our auditor’s report.
Who we report to
This report is made solely to the Company’s shareholders, as a body. Our audit work has been
undertaken so that we might state those matters which we are required to state to them in an auditor’s
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.
The engagement partner on the audit resulting in this independent auditor’s report is Jonathan
Skilton.
For and on behalf of:
Chartered Accountants
23 May 2019
Auckland
PwC
56
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 METRO PERFORMANCE GLASS LIMITED
CORPORATE GOVERNANCE AND
STATUTORY INFORMATION
57
CORPORATE GOVERNANCE
Metro Performance Glass’ (Metroglass,
the Company) Board and Senior Leadership
Team (SLT) recognise the importance of
sound corporate governance and consider
it core to ensuring the creation, protection
and enhancement of shareholder value.
Together, the Board and SLT are committed
to making sure that the Company applies
and adheres to practices and principles
that ensure good governance and maintain
the highest ethical standards to protect
the interests of shareholders and all
stakeholders.
Metroglass’ corporate governance framework clearly sets out how
the Board is accountable to the owners of the Company and how it
delegates responsibilities to the Chief Executive Officer (CEO) and
the SLT. This framework has been guided by the recommendations
set out in the NZX Corporate Governance Code (the NZX Code) and
the requirements set out in the NZX Main Board Listing Rules.
The information in this section is current as at 23 May 2019 and
has been approved by the Board. Metroglass considers that, during
the year to 31 March 2019 (reporting period), the Company
materially complied with the NZX Code.
Metroglass’ shares are also listed on the Australian Securities
Exchange (ASX) with ASX Foreign Exempt Listing status. Given this
status, the ASX requires the Company to comply with the NZX Main
Board Listing Rules and confirm its adherence to these rules annually,
and to comply with a specific subset of the ASX Listing Rules.
This corporate governance statement reflects a summary of the
Company’s corporate governance framework, policies and
procedures and how they comply with the NZX Code. The full
corporate governance framework has been approved by the Board
and is available in the Investor Centre section of the Company’s
website at http://www.metroglass.co.nz/investor-centre/
governance/ and includes:
1. Constitution
2. Code of Ethics
3. Board Charter
4. Audit and Risk Committee Charter
5. People and Culture Committee Charter
6. Share Trading Policy
7. Market Disclosure Policy
8. Diversity and Inclusion Policy
58
NZX CODE: KEY PRINCIPLES
This section sets out Metroglass’ corporate governance policies,
practices and processes by reference to the NZX Code’s eight key
principles and supporting recommendations.
PRINCIPLE 1: CODE OF ETHICAL BEHAVIOUR
“Directors should set high standards of ethical behaviour,
model this behaviour, and hold management accountable for
these standards being followed throughout the organisation.”
CODE OF ETHICS
Metroglass has a Code of Ethics that establishes a framework of
standards by which the Directors, employees, contractors and
advisors of Metroglass 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
Metroglass’ values, business goals and legal and policy obligations.
It requires Metroglass’ employees to:
• Act honestly and with personal integrity in all actions
• Undertake proper receipt and use of corporate information,
assets and property
• Adhere to procedures around confidentiality, conflicts of
interest, gift giving, and whistleblowing
• Comply with all law and Metroglass policies.
The Code of Ethics also imposes a number of obligations on
Directors, including requirements that they give proper attention
to the matters before them; be up to date on their regulatory,
legal, fiduciary and ethical obligations; undertake training; manage
breaches of the Code of Ethics; and act honestly and in the best
interests of the issuer, shareholders and stakeholders and as
required by law.
Metroglass monitors compliance with the Code of Ethics through
its management processes as well as through the whistleblowing
procedures set out in the Code of Ethics and separate
Whistleblower Protection Policy. The code is reviewed at least every
two years and was last reviewed in July 2017.
SHARE TRADING POLICY
Company’s Share Trading Policy governs trading in the Company’s
shares and any associated financial products (during the reporting
period these were Metroglass’ NZX- and ASX-listed shares). The
policy applies to:
• Directors, Officers and members of the Senior Leadership Team
(SLT);
• Any employee who reports directly to a member of the SLT or
the Group Financial Controller; and
• Any other employee to whom the CEO deems the policy should
apply.
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 In particular, the Policy notes that:
• Buying or selling Metroglass’ shares is prohibited in the
“blackout” periods set out in the policy (these periods occur
prior to the release of the Company’s half-year and full-year
financial result releases to the market)
• Outside of a blackout period, consent must be obtained before
buying or selling Metroglass shares. This consent requires
confirmation that no material information is held.
The policy is reviewed at least every two years and was last
reviewed on 31 July 2017.
PRINCIPLE 2: BOARD COMPOSITION AND PERFORMANCE
“To ensure an effective Board, there should be a balance of
independence, skills, knowledge, experience and perspectives”.
The Board has ultimate responsibility for the strategic direction of
Metroglass and for overseeing Metroglass’ management for the
benefit of its shareholders.
Metroglass’ 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. At least two
Directors must be ordinarily residents of New Zealand and at least
two must be Independent Directors. The Chair of the Board cannot
be the CEO or the Chair of the Audit and Risk Committee.
The Directors bring a wide range of skills to the Board including
expertise in corporate strategy, national and international business
and financial management, sales, marketing, mergers and
acquisitions, legal, capital markets, industry experience and
corporate governance. As at 23 May 2019, the Board comprised six
Independent Directors. Director profiles and length of service are
detailed on pages 12 and 13 of this report.
BOARD CHARTER
The Board operates under a written Charter, which describes the
Board’s authority, duties, responsibilities, composition and
framework for operation. This Charter also affirms that the Board,
in performing its responsibilities, should act at all times in a
manner designed to create and build sustainable value for
shareholders and in accordance with the duties and obligations
imposed on the Board by Metroglass’ Constitution and by law. The
Charter is reviewed at least every two years and was last reviewed
on 1 March 2019.
Management of Metroglass on a day-to-day basis is undertaken by
the CEO and senior managers through a set of delegated
authorities that clearly define the CEO and senior managers’
responsibilities and those retained by the Board. Metroglass’ Board
and CEO delegated authority policies are reviewed at least annually
and were last reviewed on 28 March 2019.
The Board meets its responsibilities by receiving reports and plans
from management and through its annual work programme. The
Board uses committees to address issues that require detailed
consideration. Committee work is undertaken by Directors;
however, the Board retains ultimate responsibility for the functions
of its committees and determines their responsibilities.
NOMINATION AND APPOINTMENT OF DIRECTORS:
The provisions regarding the election and retirement of Directors
are contained in the Metroglass Constitution. Board succession is
the responsibility of the People and Culture Committee, on behalf
of the board.
Metroglass strives to ensure that the Company has the right mix
of skills and experience it requires to enable it to achieve its
strategic aims in a prudent and responsible manner. The Board will
review its composition from time to time 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 skill sets as being required at the time as well as the
individual’s experience and professional qualifications.
In considering a prospective Director, the Board also assesses the
prospective Board members’ ability to exercise sound business
judgment, their 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. The Company is
assisted in arriving at these judgments with external advice and a
set of comprehensive background checks.
To support the Board in its deliberations, the Directors take into
account a skills matrix that sets out the mix of skills and diversity
of the Directors and evaluates whether the collective skills and
experience of the Directors meet Metroglass’ requirements both
now and into the future.
New Directors provide the Company with a written consent to act
as a Director and receive a formal Letter of Appointment 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 also provided with an extensive briefing
on the Company and industry-related matters within a thorough
induction process.
SELECTION OF CHAIR:
The Metroglass Constitution provides that the Directors may elect
a Chairperson of the Company and also determine the period for
which the Chairperson is to hold office. Peter Griffiths is an
Independent Director and is currently the appointed Chairperson.
RETIREMENT AND RE-ELECTION:
The Company’s Constitution and NZX Main Board Listing Rules
require a newly appointed Director to stand for election at the
next Annual Shareholders’ Meeting (ASM).
Rhys Jones (appointed to the Board during the 2018 financial year)
and Gordon Buswell and Russell Chenu (having retired by rotation)
59
CORPORATE GOVERNANCE (CONTINUED) were elected as Directors of Metro Performance Glass Limited at
the Company’s ASM on 24 August 2018. Angela Bull and Peter
Griffiths will each retire by rotation and stand for re-election at
the Company’s 2019 ASM.
The Company believes that an ability to attract and retain a
diverse and inclusive workforce broadens the recruitment pool of
high-calibre candidates, enhances innovation and improves
business performance.
A copy of the Company’s Diversity and Inclusion Policy is available in
the Corporate Governance section of the Company’s website. The
Policy is reviewed at least annually and was last reviewed on 30
April 2019.
How is our workforce made up?
Age
65+
1%
55-64
45–54
35–44
25–34
16–24
Ethnicity
Gender
11%
11%
23%
23%
31%
Australian
11%
Asian
(including
Indian)
15%
Other
11%
Prefer
not to
say; other
4%
Women
13%
NZ
European
45%
Maori
10%
Pacific
Islander
9%
Men
83%
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. 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 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 these
relationships.
As at 23 May 2019, all six Directors are considered by the Board to
be Independent Directors in accordance with the NZX Main Board
Listing Rules. Information in respect of each Director’s ownership
interests are detailed on page 75 of this report. Metroglass
Directors are not formally required to own Metroglass shares but
are encouraged to do so.
DIRECTOR TRAINING:
The Company encourages Directors to continue to develop their
knowledge and skills as a Director. With the prior approval from the
Chair, Directors may attend appropriate courses or seminars for
continuing education at the Company’s cost.
BOARD, DIRECTOR AND COMMITTEE EVALUATION:
In accordance with the Board and Committee Charters, the Board
annually reviews its performance, policies and practices. It also
reviews annually the performance of each Director and Board
committees. These reviews are carried out both formally and
informally.
The Board conducted a full performance review this year
(completed in May 2019) with the assistance of governance
services firm Propero Consulting. The Audit and Risk Committee
was last reviewed in February 2019. The People and Culture
Committee was formed in April 2018, and will undertake a review in
the coming 12 months.
DIVERSITY AND INCLUSION:
Metroglass and its Board believe that an equal opportunity
workplace in which differences in gender, age, ethnicity, nationality,
religion, sexual orientation, physical ability, marital status,
experience and perspective are well represented, results in a
competitive advantage and helps the Company to better connect
with its diverse set of customers and other stakeholders.
60
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019CORPORATE GOVERNANCE (CONTINUED) As at 31 March 2019 (and 31 March 2018 for the prior comparative period), the mix of gender among the Company’s Board
and SLT and Board were:
31 March 2019
Board
Senior Leadership Team
31 March 2018
Board
Senior Leadership Team
Female
Male
Total
% Female
1
3
5
5
6
8
17%
38%
Female
Male
Total
% Female
1
2
5
6
6
8
17%
25%
Metroglass is committed to providing an inclusive and diverse environment throughout the Company. The Company’s current
Diversity and Inclusion objectives are:
• Ensure that Metroglass’ workforce reflects the diversity of its stakeholder community
•
Increase the understanding and acceptance of difference
• Fair and consistent reward and recognition
• Ensure female candidates are identified for all Board and senior management vacancies
In 2018 the Board approved three strategic initiatives to advance the Company’s diversity objectives in the 2019 financial
year. The table below details these initiatives and Metroglass’ progress against them.
INITIATIVE
PROGRESS MADE
Survey the Company’s current workforce to collect baseline
diversity and inclusiveness data, and report summarised results in
the FY19 Annual Report.
Roll out the second phase of the Company’s diversity and
inclusiveness training programme to all senior managers, with other
staff to follow incrementally.
Record and report details of candidate diversity in the recruitment
process for Board and senior management positions, endeavouring
to ensure that female candidates are identified for these positions.
This data was collected as part of the Company’s wider staff
survey completed in October 2018. A summary of the results are
presented above, alongside the required data tables showing Board
and SLT gender diversity.
The Company engaged Diversity Works New Zealand this year and
conducted a diversity and inclusion stocktake to determine where
the Company is today, and to prioritise improvement efforts going
forward. A training programme is in development and will be rolled
out in the coming financial year and thereafter.
11% of the Board and senior management roles recruited for in the
past financial year had a successful female candidate (2018: 25%)
and 17% had at least one short listed female candidate who was
interviewed (2018: 38%).
Amandeep Kaur was appointed as Group Health and Safety
Manager, and as a member of the SLT in April 2019.
The Company’s targets for the 2020 financial year are:
1. Continue to strive to ensure strong female candidates are identified in the recruitment process for all Board and senior
management roles;
2. Provide diversity and inclusiveness training in line with the programme developed with Diversity Works; and
3. Agree a work program to make the Company a more inclusive and diverse business.
61
CORPORATE GOVERNANCE (CONTINUED) PRINCIPLE 3: BOARD COMMITTEES
“The Board should use committees where this will enhance its effectiveness in key areas, while still
retaining Board responsibility”
In the year to 31 March 2019, the Board had two standing committees, being the Audit and Risk Committee
and People and Culture Committee.
BOARD AND COMMITTEE COMPOSITION AND ATTENDANCE 12 MONTHS TO 31 MARCH 2019
Audit and Risk
Committee
meetings
attended
7
7/7
7/7
People and
Culture
Committee
meetings
attended
6
6/6 (c)
6/6
Appointed/ Resigned
Appointed: 02/09/16
Appointed: 05/05/17
Appointed: 07/10/15
Appointed: 05/07/14
6/6
Appointed: 01/04/18
7/7 (c)
Appointed: 05/07/14
Board meetings
attended
15
14/15 (c)
15/15
15/15
14/15
15/15
15/15
Meetings held
SITTING DIRECTORS
Peter Griffiths
Angela Bull
Gordon Buswell
Russell Chenu
Rhys Jones
Willem (Bill) Roest
(c) indicates Chair.
The Board periodically reviews the need for additional committees. Each committee operates under charters approved by
the Board, and any recommendation committee members make are directed to the Board. They do not make decisions on
behalf of the Company in their own right.
The Board’s committees and their members as at 23 May 2019 were:
• Audit and Risk Committee: Bill Roest (Chair), Russell Chenu and Peter Griffiths; and
• People and Culture Committee: Angela Bull (Chair), Gordon Buswell and Rhys Jones.
AUDIT AND RISK COMMITTEE:
The Audit and Risk Committee is responsible for overseeing the risk management framework (including treasury and
financing policies), treasury, insurance, accounting and audit activities of Metroglass. It reviews the adequacy and
effectiveness of internal controls, meets with, and reviews the performance of external auditors, oversees internal audit
matters, reviews the consolidated financial statements, and makes recommendations on financial and accounting policies.
Members of the Audit and Risk Committee are appointed by the Board and comprise a minimum of three members who are
each non-executive Directors of Metroglass. A majority of members must be Independent Directors and at least one
Director must have an accounting or financial background.
Employees of Metroglass only attend meetings of the Audit and Risk Committee at the invitation of the committee. The
Audit and Risk Committee Charter is reviewed at least every two years and was last reviewed on 28 February 2019.
PEOPLE AND CULTURE COMMITTEE:
The People and Culture Committee’s mandate is to assist the Board in ensuring the elements of people, organisation and
culture support the Company’s strategy and business plan.
The committee achieves its goals by reviewing and considering: the capability of the organisation at senior levels and in any
identified key roles; the remuneration strategy required to secure the desired level of organisational capability; the
nominations process for the appointment and succession planning of the CEO and the Board; and Company policies that
relate to people.
62
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019CORPORATE GOVERNANCE (CONTINUED) The People and Culture Committee is comprised of at least two,
and not more than four, Independent Directors. Employees of
Metroglass only attend meetings at the invitation of the
committee. The People and Culture Committee Charter is reviewed
at least every two years and was last approved by the Board on 23
May 2018.
TAKEOVER PROTOCOL
Metroglass has put in place protocols for the Board to follow in
the event of a takeover offer for the Company. The protocol is
reviewed at least every two years and was adopted on 24 August
2017.
NON-FINANCIAL REPORTING
Metroglass provides non-financial disclosures on matters including
operational priorities for the year, risk management, health and
safety, and diversity.
At this time, the Company does not report under a recognised
environmental, social and governance (ESG) framework, but aims to
provide non-financial information that would be useful to its
stakeholders. In the coming year, Metroglass will continue to better
understand the material ESG issues for the Company and
determine the importance that both the business and external
stakeholders place on them.
PRINCIPLE 4: REPORTING AND DISCLOSURE
PRINCIPLE 5: REMUNERATION
“The remuneration of directors and executives should be
transparent, fair and reasonable.”
The Metroglass Board believes its practices ensure fair and
reasonable remuneration. The Company’s remuneration policies are
aimed at ensuring that the remuneration of Directors and all staff
properly reflects each person’s accountabilities, duties,
responsibilities and their level of performance. They are also aimed
at making sure that remuneration is competitive in attracting,
motivating and retaining staff of the highest calibre.
The Board’s People and Culture Committee has a formal Charter.
Its membership and role are set out under Principle 3 above.
The Company’s remuneration policies and disclosures are covered
in the Remuneration section on pages 67 to 70 of this Annual
Report.
“The Board should demand integrity in financial and non-
financial reporting, and in the timeliness and balance of
corporate disclosures.”
Metroglass is committed to providing financial reporting that is
balanced, clear and objective and informs shareholders (both
current and prospective) and market participants of all information
that might have a material effect on the price of its traded
financial products.
The quality, integrity and timeliness of external reporting and the
Company’s compliance with the disclosure and reporting
obligations imposed under the Listing Rules of NZX, ASX, the
Companies Act and other relevant legislation are overseen by the
Audit and Risk Committee.
The Company’s full-year statements, which have been prepared in
accordance with the relevant financial standards, are set out on
pages 18 to 51 of this Annual Report.
MARKET DISCLOSURE POLICY
The Board has adopted a Market Disclosure Policy, available in the
Corporate Governance section of the Company’s website, which
sets out how the Company will comply with its disclosure and
reporting obligations.
Metroglass is committed to ensuring the timely disclosure of
material information about the Metroglass Group and to making
sure that the Company complies with NZX Main Board Listing
Rules. The Board considers at each Board meeting whether any
information discussed at the meeting requires disclosure.
The policy is reviewed at least every two years and was last
reviewed on 22 May 2019.
CHARTERS AND POLICIES
The key corporate governance documents referred to in this
section, including policies and charters, are available in the Investor
Centre section of the Company’s website at: http://www.
metroglass.co.nz/investor-centre/governance/.
63
CORPORATE GOVERNANCE (CONTINUED) PRINCIPLE 6: RISK MANAGEMENT
HEALTH AND SAFETY
“Directors should have a sound understanding of the material
risks faced by the issuer and how to manage them. The Board
should regularly verify that the issuer has appropriate
processes that identify and manage potential and material
risks.”
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 Metroglass’ business;
b) Reviewing and ratifying Metroglass’ 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 has established an Audit and Risk Committee
responsible for ensuring that effective risk management systems
and internal controls are in place, including reviewing 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 risks across the Group including health and safety (see
below). The Chief Financial Officer (CFO) has management
accountability for the implementation of the risk framework across
all the Company’s businesses.
As part of its risk management framework Metroglass continually
assesses risks against all relevant areas of material business risk.
Metroglass’ main risks and mitigation plans are reviewed every six
months by the Audit and Risk Committee.
The health and safety of the Company’s staff, contractors and
customers is of paramount concern to the Board. Accordingly, all
regular Board meetings and risk reviews specifically look at health
and safety matters. The Company maintains a Health and Safety
risk register for both New Zealand and Australia, which is reviewed
at least annually.
In view of the customer, manufacturing and glazing focus of the
business, and the nature of the Company’s products, key risks are
strains, sprains and lacerations resulting from the manual aspect
of its work processes. Metroglass mitigates these risks by
automating activities or providing mechanical assistance where
possible, mandating the use of appropriate personal protective
equipment and by training staff and contractors in correct manual
handling practices.
Metroglass believes that all injuries are preventable and that its
people should get home safe every day. The Company is
disappointed that the LTIFR increased in both FY18 and FY19, after
reductions in each of the prior two years. The majority of incidents
in the reporting period related to muscle or joint strains while
lifting heavy glass, and Metroglass continuously conducts incident
reviews to ensure that the right equipment and processes are in
place to manage and reduce these risks.
During the past financial year, the Company has worked to ensure
that safety is at the front of people’s minds. This has included
introducing a formal program in which all senior leadership team
members engage in regular safety interactions across the Group,
completing active reviews and enhancements of the personal
protective equipment (PPE) being used, and appointing a Group
Health and Safety Manager (reporting directly to the Group CEO).
All of the Company’s New Zealand properties are certified under
the Accident Compensation Corporation (ACC) Partnership
Programme at a tertiary level. Each of the seven major
manufacturing facilities across New Zealand and Australia are
supported by a Safety Manager.
Group health and safety performance
FY19
FY18
FY17
10.5
(28 incidents)
9.3
(24 incidents)
8.5
(19 incidents)
34.8
(93 incidents)
38.2
(99 incidents)
40.1
(90 incidents)
LTIFR
TRIFR
Definitions:
• Lost-Time Injury Frequency Rate (LTIFR) is measured by
calculating the number of injuries resulting in at least one full
work day lost per million hours worked; and
• Total Reportable Incident Frequency Rate (TRIFR) is measured
by calculating the number of medical treatment cases and
lost-time injuries per million hours worked.
64
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019CORPORATE GOVERNANCE (CONTINUED) PRINCIPLE 7: AUDITORS
PRINCIPLE 8: SHAREHOLDER RIGHTS AND RELATIONS
“The Board should ensure the quality and independence of the
external audit process.”
The Metroglass Audit and Risk Management Committee is charged
with overseeing all aspects of the external and internal audit of
the Company. It does not take decisions on behalf of the Board.
However, it has delegated responsibility for:
EXTERNAL AUDIT
• Recommending the appointment and removal of the auditors;
• Recommending audit fees;
• Reviewing auditor independence and performance;
• Reviewing and monitoring audit service delivery;
• Ensuring the ability of the external auditors to carry out their
statutory audit role and their independence is not impaired, or
could reasonably be perceived to be impaired; and
• Serving as the primary contact point for auditors in relation to
any problems, reservations or issues arising from the audit and
referring matters of a material or serious nature to the Board.
“The Board should respect the rights of shareholders and
foster constructive relationships with shareholders that
encourage them to engage with the issuer.”
Metroglass endeavours to keep its shareholders informed of all
important developments concerning the Company and encourages
them to follow its announcements. Metroglass believes that
effective engagement with investors will benefit both the Company
and investors. As a result of investor feedback, Metroglass’
continued aim is to provide clearer communication of the
Company’s strategic direction, including articulating Metroglass’
strategic priorities and how these leverage Metroglass’
competitive advantages.
In the 2019 financial year, Metroglass communicated 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 (if the materials are different to that previously
released to the NZX and ASX)
INTERNAL AUDIT
• The Annual and Interim Reports
• Recommending internal audit assignments; and
• The Annual Shareholders’ Meeting and the Notice of Meeting
• Monitoring and reviewing the internal auditing practices;
• The Company’s corporate website.
The Company does not have a standalone internal audit function.
External advisors are employed to evaluate and improve the
effectiveness of the Company’s risk management and internal
processes. Progress and results on these projects are reported
regularly to the Audit and Risk Committee or the Board.
The Audit and Risk Committee is authorised by the Board, at
Metroglass’ expense, to obtain such outside legal or other
independent information and advice including market surveys and
reports, and to consult with such management consultants and
other outside advisors as it views necessary to carry out its
responsibilities.
The Audit and Risk Committee meets at least three times each
year and has direct access to Metroglass’ external and internal
auditors and senior management. On at least one occasion each
year, the Audit and Risk Committee meets with the external
auditors without management present.
ANNUAL SHAREHOLDERS’ MEETING
Shareholders have the opportunity to ask questions of the Board
and of the external auditors, who attend the Annual Shareholders’
Meeting. The external 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
Metroglass.
The Company’s Chair, CEO, CFO and Investor Relations Officer
currently lead engagement with shareholders and, in line with
Metroglass’ market disclosure policy, aim to be responsive, to
provide clear, accurate and timely disclosures, and to provide
meaningful insight into the Company and the industry.
ELECTRONIC COMMUNICATIONS:
Shareholders are encouraged to receive communications from, and
send communications to, the Company and its security registry
electronically. The shareholder contact point at the Company is:
glass@metroglass.co.nz.
ANNUAL REPORT
Metroglass’ Annual Report and Interim Reports are all available on
the Company’s website at: http://www.metroglass.co.nz/investor-
centre/annual-interim-reports. Shareholders can elect to receive a
printed copy of these reports by contacting the Company’s share
registrar, Link Market Services. Any shareholder who does request
a hard copy of the Metroglass Annual Report will be sent one in the
regular post.
65
CORPORATE GOVERNANCE (CONTINUED) SHAREHOLDER VOTING RIGHTS
In accordance with the Companies Act 1993, Metroglass’
Constitution and the NZX Main Board Listing Rules, the Company
refers major decisions which may change the nature of the
Company to shareholders for approval.
Metroglass conducts voting at its shareholder meetings by way of
a poll and on the basis of one share, one vote. Further information
on shareholder voting rights is set out in Metroglass’ Constitution.
NOTICE OF ANNUAL MEETING
Metroglass’ previous annual meeting was held on 24 August 2018.
The notice of the meeting was released to the market on 24 July
2018. Minutes of the meeting are available on the Company’s
website at: https://www.metroglass.co.nz/investor-centre/
annual-shareholders-meeting/.
The 2019 Annual Shareholders’ Meeting is expected to be held on
26 July 2019 in Auckland. The time and place will be provided by
notice to all shareholders nearer to that date.
66
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019CORPORATE GOVERNANCE (CONTINUED) REMUNERATION REPORT
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.
DIRECTOR REMUNERATION:
The Company distinguishes the structure of non-executive Directors’ remuneration from that of executive Directors.
Non-executive Directors are paid a fixed fee in accordance with the determination of the Board.
The total amount of remuneration and other benefits received by each Director during the year ended 31 March 2019 is set
out below.
Responsibilities
2019 Directors’ Fees
Director
Peter Griffiths
Angela Bull
Gordon Buswell
Russell Chenu
Rhys Jones
Chair of the Board, Member of the Audit and Risk Committee
Director, Chair of the People and Culture Committee
Director, Member of the People and Culture Committee
Director, Member of the Audit and Risk Committee
Director, Member of the People and Culture Committee
Willem (Bill) Roest
Director, Chair of the Audit and Risk Committee
Total
The Chair of the Board receives $160,000 per annum (with no additional committee fees paid) and the non-executive
Directors receive $80,000 per annum. The Chair 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 (excluding the Board Chair Peter
Griffiths). The Chair and members of the People and Culture Committee receive an additional $5,000 per annum. Directors
may also seek the Board’s approval for special remuneration should the specific circumstances justify this.
The Board reviews its fees on a periodic basis. The maximum aggregate amount of remuneration payable by Metroglass to
the non-executive Directors (in their capacity as Directors) is set at $614,000.
Directors’ fees exclude GST, where appropriate. No retirement or termination benefits are paid to non-executive Directors;
however, Directors are entitled to be refunded 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 Metroglass Group’s business.
The Company does not offer an equity-based remuneration scheme for Directors. The Board considers that Director and
executive remuneration is appropriate and is not excessive.
Directors and Officers also have the benefit of Directors and Officers’ liability insurance. This covers risks normally included
in such policies arising out of acts or omissions of Directors and employees in their capacity as such. The insurance cover is
supplemented by the provision of Director and Officer indemnities from the Company but this does not extend to criminal
acts.
EXECUTIVE REMUNERATION:
The remuneration of members of senior management (CEO, SLT and certain direct reports) is designed to promote a
higher-performance culture, to secure the participant’s retention in Metroglass and to reward performance that underpins
the achievement of Metroglass’ business strategy and long-term shareholder wealth creation.
The Board is assisted in delivering its responsibilities and objectives for executive remuneration by the People and Culture
Committee. The role and membership of this committee is set out in section 1 of the Statement of Corporate Governance.
The CEO’s performance is reviewed annually by the Board. The CEO reviews the performance of the SLT and makes
recommendations to the Board for approval in relation to the team’s remuneration and achievement of key performance
indicators (KPIs).
$160,000
$85,000
$85,000
$90,000
$85,000
$100,000
$605,000
67
Long-term incentives
The Company’s LTI plan for the 2019 financial year was announced
on the 3 July 2018. The LTI plan is made up of both performance
share rights and share options. The LTI is designed to secure those
employees’ retention in Metroglass and to reward performance
that underpins the achievement of Metroglass’ business strategy
and long-term shareholder wealth creation. The key features of
the 2019 LTI plan are as follows:
• Participants will be offered an annual award of a specified
number of both performance rights and share options in
Metroglass (in accordance with the LTI rules)
• The performance rights will enable participants to acquire
shares in Metroglass with no consideration payable, subject to
Metroglass achieving set performance hurdles and meeting
certain vesting conditions
• The share options enable participants to acquire shares in
Metroglass at a specified exercise price, subject to Metroglass
achieving set performance hurdles and meeting certain vesting
conditions.
A total of 3,826,144 share options and 1,075,205 performance
share rights remain outstanding pursuant to the 2017, 2018 and
2019 LTI plans as at 23 May 2019.
2017 NZ Employee Share Purchase Scheme (Scheme)
On 21 February 2017, Metroglass launched an employee share
purchase scheme for New Zealand-based employees. This scheme
enabled participants to purchase either $1,000 or $2,000 worth of
Metroglass shares at a 50% discount to market value. Shares are
held in trust on behalf of the participants for a minimum three-
year holding period until the vesting date of 21 February 2020.
Vesting conditions include ongoing employment with the Company
as at the vesting date. The Company provided participants with
interest-free loans to fund the participant contribution (being
50%) towards the acquisition of the shares, which is to be repaid
over the three-year holding period. In aggregate, 348,086 shares
were issued under this scheme on 21 February 2017 at an issue
price of $1.54.
Metroglass intends to launch a new employee share scheme during
the 2020 financial year.
REMUNERATION REPORT (CONTINUED)
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 discretionary short-term incentive (STI)
• A long-term incentive (LTI).
Short-term incentives:
Short-term incentives (STI) are at-risk payments designed to
motivate and reward for performance, typically within that
particular financial year. The target value of an STI payment is set
annually, usually as a percentage of the participant’s base salary.
For the 2019 financial year, the relevant percentages varied from
10% to 50%.
The STI plans relate to achievement of annual performance
metrics which aim to align executives to a shared set of KPIs based
on business priorities for the next 12 months and that participants
are able to influence. Target measurements are set on either a
regional or a national basis depending on the participant’s position
and role.
In the 2019 financial year, the target areas were consistent in
New Zealand and Australia, and are outlined below:
Target
Weighting
FY19 Result:
NZ
FY19 Result:
Australia
Earnings before
interest, tax and
amortisation
(EBITA)
performance
70%
Deliveries-In-Full-
On-Time
30%
Achieved
in 1 of 3
NZ regions,
and at the
national level
Achieved in
1 of 3 NZ
regions, not
achieved at
the national
level
Not achieved
Not achieved
The payable rewards for each STI KPI target are determined by the
level of performance achieved and are calculated on a linear scale
increasing from the ‘Minimum performance target’ and receiving
80% of the specified reward, up to the ‘Maximum performance
target’ and receiving 150% of the specified reward. The maximum
performance levels allow employees to be rewarded for
performance above target levels.
All STI payments are contingent on there being no death or
permanent material disability of any worker (exceptions may be
made for a motor accident and acts of God as beyond
management control). Should this occur, the Board retains
discretion to determine the appropriate actions based on the
specific circumstances.
68
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 REMUNERATION REPORT (CONTINUED)
Chief Executive Officer’s Remuneration:
Metroglass’ new CEO Simon Mander joined the Company on 19 November 2018, following former CEO Nigel Rigby’s departure
on 31 March 2018.
Fixed CEO remuneration for the past three financial years (12 months to 31 March)
Financial year
FY19
FY18
FY17
CEO
Current
Former
Former
FIXED REMUNERATION
Salary Other benefits**
$214,166*
$550,000
$500,000
$8,173
$20,385
$18,555
Total fixed
remuneration
$222,339
$570,385
$518,555
* Pro-rated for a partial year. The full year salary for Simon Mander is set at $650,000.
** Other benefits include medical insurance and KiwiSaver.
Description of Chief Executive Officer’s remuneration for performance for the year ended 31 March 2019
Plan
STI
Description
Set at 50% of fixed remuneration for
FY19 on-plan performance in New Zealand,
up to a maximum of 1.5 times (equal to
75% of fixed remuneration), where the
highest levels of STI targets are achieved.
Any payment is pro-rated for months of
service. STI targets are based on a full year
of group performance in FY20.
LTI
Nil. Will be eligible to participate in the next
LTI scheme.
Performance measures
70%: EBITA performance
30%: DIFOT
Percentage of
maximum awarded
59%
N/A
Financial year of STI payment
FY20
FY19
FY18
FY17
CEO
Current
Former
Former
Former
PAY FOR PERFORMANCE – SHORT-TERM INCENTIVES
Relevant
performance period
% STI awarded
against maximum
FY19
FY18
FY17
FY16
59%
0%
10%
67%
STI paid
$96,342*
$0**
$28,563
$201,062
* Pro-rated for 4 months out of 12 following the CEO joining in November 2018.
** A separate one-off incentive payment was awarded to the departing CEO in the 2019 financial year as described in detail in the 2018
Annual Report.
FY19
FY18
FY17
FY16
CEO
Current
Former
Former
Former
PAY FOR PERFORMANCE – LONG-TERM INCENTIVES
LTI
(initial grant values)*
% LTI vested against
maximum
Span of LTI
performance periods
Nil
125,000
125,000
125,000
n/a
n/a
Nil**
08/06/ – 08/06/20
Nil** 10/06/16 – 10/06/19
Nil
07/12/15 – 07/12/17
* These are LTI grant values (not payments), which require relevant hurdles to be met over specific performance periods. Performance with
regard to the FY19 LTI scheme will be tested in the FY21 year.
** These holdings were cancelled when the CEO left the Company (the three year holding hurdle was not met).
69
REMUNERATION REPORT (CONTINUED)
Settlement with former Chief Executive Officer:
Employees Remuneration:
In March 2019, Metroglass issued proceedings in the Employment
Relations Authority seeking to enforce the comprehensive
restraint of trade set out in the 2017 settlement agreement with
former CEO, Nigel Rigby. The parties were directed to mediation
which was completed in April 2019.
As a result of the mediation, Mr Rigby’s restraint of trade has been
modified in terms of duration but is enforceable in both Australia
and New Zealand. Further assurances have been received from
Crescent Capital and Viridian Glass that provide additional support
to the protections Metroglass has under the restraint of trade,
and Metroglass received a confidential sum as part of the
resolution of its claims.
The number of employees or former employees (including
employees holding office as Directors of subsidiaries) who received
remuneration and other benefits in their capacity as employees,
the value of which was at or in excess of $100,000 and was paid to
those employees during the financial year ended 31 March 2019, is
specified in the table below.
The remuneration figures shown in the “Remuneration” column
include all monetary payments actually paid during the course of
the 2019 financial year. This includes salary, STI payments that were
paid during the year, and the value of performance share rights
and share options (LTI) expensed during the financial year.
Remuneration shown below includes settlement payments and
payments in lieu of notice with respect to certain employees upon
their departure from the Company, but does not include any
amounts paid post 31 March 2019 that relate to the year ended 31
March 2019.
Remuneration
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
210,000 – 220,000
220,000 – 230,000
230,000 – 240,000
240,000 – 250,000
250,000 – 260,000
260,000 – 270,000
340,000 – 350,000
420,000 – 430,000
480,000 – 490,000
520,000 – 530,000
2,850,000–2,900,000*
Number of
employees
38
25
17
13
11
5
9
1
3
3
2
6
0
2
1
3
1
1
1
1
1
1
*This reflects the final payment made to the departing CEO in the
2019 financial year.
70
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 STATUTORY INFORMATION
STOCK EXCHANGE LISTING
Metroglass’ shares are listed on the New Zealand Stock Exchange (NZX) and Australian Stock Exchange (ASX).
Shares on issue as at 1 May 2019:
Register
New Zealand
Australia
Total
Securities issued, and still outstanding, under the 2016 – 2019 LTI plans:
Long-Term Incentive Scheme
2016 Performance Share Rights
2016 Share Options
2017 Performance Share Rights
2017 Share Options
2018 Performance Share Rights
2018 Share Options
2019 Performance Share Rights
2019 Share Options
TOP 20 SHAREHOLDERS
Security
Holders
Units
MPG (NZX)
MPP (ASX)
MPG (Dual)
3,208
164,824,829
121
20,553,257
3,329
185,378,086
Security
Holders
Units
MPG (NZX)
MPG (NZX)
MPG (NZX)
MPG (NZX)
MPG (NZX)
MPG (NZX)
MPG (NZX)
MPG (NZX)
–
–
12
12
29
29
–
–
127,950
532,266
337,834
1,351,344
609,421
1,942,534
Metroglass’ top 20 registered shareholders as at 1 May 2019 were as follows:
Rank
Investor Name
Footnote*
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
HSBC Nominees (New Zealand) Limited
Accident Compensation Corporation
Masfen Securities Limited
J P Morgan Nominees Australia Pty Limited
Nigel James Rigby
FNZ Custodians Limited
Citicorp Nominees Pty Limited
FNZ Custodians Limited
BNP Paribas Nominees Pty Ltd
National Nominees Limited
New Zealand Superannuation Fund Nominees Limited
FNZ Custodians Limited
Premier Nominees Limited
Cogent Nominees Limited
Cogent Nominees (NZ) Limited
JBWere (NZ) Nominees Limited
JPMorgan Chase Bank
Citibank Nominees (NZ) Ltd
*
*
*
*
*
*
*
*
Shares at
1 May 2019
31,002,514
12,091,936
8,842,667
5,470,387
5,243,714
4,787,312
4,612,507
4,610,373
3,652,359
3,227,467
3,203,072
3,170,779
2,436,552
2,369,440
2,284,118
2,281,711
2,244,635
1,651,218
% of
shares
16.72%
6.52%
4.77%
2.95%
2.83%
2.58%
2.49%
2.49%
1.97%
1.74%
1.73%
1.71%
1.31%
1.28%
1.23%
1.23%
1.21%
0.89%
71
STATUTORY INFORMATION (CONTINUED)
Rank
Investor Name
19
20
BNP Paribas Noms Pty Ltd
Philip George Lennon
Totals: Top 20 registered holders of ordinary shares
Footnote*
Shares at
1 May 2019
1,521,435
1,345,767
106,049,963
% of
shares
0.82%
0.73%
57.20%
Totals: Remaining holders’ balance
79,328,123
42.80%
* Held through New Zealand Central Securities Depository Limited (NZCSD). NZCSD provides a custodial depository service which allows
electronic trading of securities by its members and does not have a beneficial interest in these shares. As at 1 May 2019, a total of
60,545,057 Metroglass shares (or 32.66% of the ordinary shares on issue) were held through NZCSD.
SUBSTANTIAL SHAREHOLDERS
According to the records kept by the Company under the Financial Markets Conduct Act 2013 the following were
substantial holders in the Company as at 1 May 2019. Shareholders are required to disclose their holdings to Metroglass
and to its share registrar by giving a “Substantial Shareholder Notice” when:
• They begin to have a substantial shareholding (5% or more of Metroglass’ 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.
Investor name
Bain Capital Credit, LP
Schroder Investment Management (Australia) Limited
Investment Services Group Limited
Inclusive of:
Devon Funds Management
Accident Compensation Corporation
National Australia Bank Limited
Number of
shares
20,475,000
18,332,875
12,949,138
11,999,138
12,091,936
9,570,413
%
11.05%
9.89%
6.99%
6.47%
6.52%
5.16%
Date of most
recent notice
30/11/18
03/07/18
27/11/18
25/03/19
09/04/19
The following shareholders ceased to be substantial shareholders during the period 2 May 2018 to 1 May 2019: New Zealand
Superannuation Fund on 29 November 2018.
DISTRIBUTION OF SHAREHOLDERS
As at 1 May 2019:
Range
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 50,000
50,001 – 100,000
Greater than 100,000
Total
VOTING RIGHTS
Number of
holders
287
1,026
704
1,036
139
137
3,329
%
8.62%
30.82%
21.15%
31.12%
4.18%
4.12%
Number of
shares
207,746
3,260,369
5,658,135
24,150,692
10,266,249
141,834,895
%
0.11%
1.76%
3.05%
13.03%
5.54%
76.51%
100.00%
185,378,086
100.00%
Section 15 of the Company’s Constitution states that a shareholder may vote at any meeting of shareholders in person or
through a representative. Metroglass conducts voting by way of a poll, using this method 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
Metroglass’ Constitution available on the Company’s website at: https://www.metroglass.co.nz/investor-centre/governance/.
72
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 STATUTORY INFORMATION (CONTINUED)
TRADING STATISTICS
Metroglass is listed on both the NZX and ASX. The trading ranges for the period 1 April 2018 to 31 March 2019 are as
follows:
Minimum:
Maximum:
Range:
Total shares traded
DIVIDEND POLICY
NZX
NZ$0.40 (26/11/18)
NZ$0.91 (02/07/18)
NZ$0.40 – NZ$0.91
104,044,597
ASX
AU$0.38 (27/11/18)
AU$0.88 (03/07/18)
AU$0.38 – AU$0.88
2,340,185
Dividends and other distributions with respect to the shares are only made at the discretion of the Board of Metroglass.
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 (and to determine the quantum of the dividend) for shareholders in any financial year
will depend on, amongst other things:
• All statutory or regulatory requirements
• The financial performance of Metro Performance Glass
• One-off or non-recurring events
• Metroglass capital expenditure requirements
• The availability of imputation credits
• Prevailing business and economic conditions
• The outlook for all of the above
• Any other factors deemed relevant by the Board.
On 26 November 2018, the Company announced its intention to prioritise debt reduction, and that it was targeting a lower
leverage ratio for the group (as measured by net debt to rolling 12‐month EBITDA) of approximately 1.5 times. At 31 March
2019, this ratio was 2.1 times. No dividends have been declared in respect of the 2019 financial year.
NZX AND ASX WAIVERS
Metroglass does not have any waivers from the requirements of the NZX Main Board Listing Rules, and has waivers in place
with the ASX that are standard for a New Zealand company listed on the ASX.
Metroglass has an ASX Foreign Exempt Listing on the ASX. This category is based on a principle of substituted compliance,
recognising that for secondary listings, the primary regulatory role and oversight rest with the home exchange. Metroglass
continues to have a full listing on the NZX Main Board.
73
STATUTORY INFORMATION (CONTINUED)
DISCLOSURE OF DIRECTORS’ INTERESTS
Directors disclosed, under section 140(2) of the New Zealand Companies Act 1993, the following interests as at 31 March.
2019:
Director and Company
Angela Jennifer Bull
Callaghan Innovation Research Limited
New Zealand Institute of Economic Research
Real Estate Institute of New Zealand
Gordon John Buswell
About Direction Limited
Building Industry Federation
Construction Strategy Group
Platinum Homes Limited
Quad Concepts Limited
Registered Master Builders Association
Russell Langtry Chenu
5R Solutions Pty Limited
CIMIC Group Limited
James Hardie Industries plc
Reliance Worldwide Corporation Limited
Peter Ward Griffiths
Great Barrier Airlines Limited
Island Leader Limited
Another New Plane Co Limited
New Zealand Business and Parliament Trust
NZDS Properties (NO 2) Limited
Shoman Limited
Wings over Whales NZ Limited
Z Energy Limited
Z Energy 2015 Limited
Rhys Jones
Vulcan Steel Limited
Vulcan Steel Pty Limited
Carbine Aginvest Corporation Limited
Dairy Technology Services Limited
Resin & Wax Holdings Limited
Willem (Bill) Jan Roest
Fisher & Paykel Appliances Holdings Limited
Housing Foundation Limited
Synlait Milk Limited
Synlait Milk Finance Limited
74
Position
Director
Deputy Chair
Director
Director and Shareholder
Chair
Deputy Chair
Chair
Strategic Advisor
Director
Director
Director
Director
Director
Director and Shareholder
Director and Shareholder
Director and Shareholder
Chair and Trustee
Director and Shareholder
Director and Shareholder
Director and Shareholder
Chair
Chair
Director and Shareholder
Director and Shareholder
Director
Director
Chair and Shareholder
Director
Director
Director
Director
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 STATUTORY INFORMATION (CONTINUED)
SUBSIDIARIES AND SUBSIDIARY DIRECTORS
Section 211(2) of the Companies Act 1993 requires the Company to disclose, in relation to its subsidiaries, the total
remuneration and value of other benefits received by the Directors and former directors, together with particulars of
entries in the interests registers made, during the year ended 31 March 2019.
No Group employee appointed as a director of Metro Performance Glass Limited or its subsidiaries receives or retains any
remuneration or other benefits in their capacity as a director, and each is a full-time Group employee. The remuneration
and other benefits of such employees and former employees (received as employees) totalling NZ$100,000 or more during
the year ended 31 March 2019 are included in the remuneration bandings disclosed on page 70 of this Annual Report.
Within the 2019 financial year, Simon Mander was appointed director of each of the eight New Zealand subsidiaries (19
December 2018), and Andrew Paterson ceased to be a director of the same set of companies on the same date. As at 31
March 2019, Metroglass’ subsidiary companies and subsidiary directors were:
Company
Directors
Australian Glass Group (Holdings) Pty Limited
John Fraser-Mackenzie, Jason McGrath
Australian Glass Group Finance Company Pty Limited
John Fraser-Mackenzie, Jason McGrath
Australian Glass Group Investment Company Pty Limited
John Fraser-Mackenzie, Jason McGrath
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
Simon Mander, John Fraser-Mackenzie
Simon Mander, John Fraser-Mackenzie
Simon Mander, John Fraser-Mackenzie
Simon Mander, John Fraser-Mackenzie
Simon Mander, John Fraser-Mackenzie
Simon Mander, John Fraser-Mackenzie
Simon Mander, John Fraser-Mackenzie
Simon Mander, John Fraser-Mackenzie
DIRECTORS’ SHAREHOLDING IN METROGLASS
The Directors’ respective interests in Metroglass shares as at 1 May 2019 are as follows:
Number of shares
in which a relevant
interest is held
45,825
50,000
25,000
195,500
58,000
25,000
Acquisition dates
Disposal dates
10/07/17, 30/08/17 and 28/08/18
25/05/18
29/07/14
n/a
n/a
n/a
Eight dates between 16/05/16 and 29/08/18 n/a
31/08/18
29/07/14
n/a
n/a
Angela Bull
Gordon Buswell
Russell Chenu
Peter Griffiths
Rhys Jones
Willem (Bill) Roest
DONATIONS
For the year ended 31 March 2019, Metroglass, including its subsidiaries, made donations of $14,368.62 (2018: $2,226.26).
NET TANGIBLE ASSETS PER SECURITY
Net tangible assets per security at 31 March 2019: 5.7 cents (31 March 2018: 0.5 cents).
CURRENCY
Within this Annual Report, all amounts are in New Zealand dollars unless otherwise specified.
CREDIT RATING
Metroglass has not requested a credit rating.
75
AUDITOR
PricewaterhouseCoopers
22/188 Quay Street
Auckland 1142
New Zealand
LAWYERS
Bell Gully
Vero Centre
48 Shortland Street
Auckland 1140
New Zealand
BANKERS
Bank of New Zealand Limited
Westpac New Zealand Limited
SHARE REGISTRAR
Link Market Services
Level 11, Deloitte Centre
80 Queen Street, Auckland 1010
PO Box 91976, Auckland 1142
FURTHER INFORMATION ONLINE
This Annual Report, Metroglass’ core governance
documents, and all Company announcements can
be viewed on its website:
http://www.metroglass.co.nz/investor-centre.
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
Peter Griffiths – Chair, Member of the Audit and
Risk Committee
Angela Bull – Non-Executive Director and Chair of
the People and Culture Committee
Gordon Buswell – Non-Executive Director and
Member of the People and Culture Committee
Russell Chenu – Non-Executive Director and
Member of the Audit and Risk Committee
Rhys Jones – Non-Executive Director and
Member of the People and Culture Committee
Willem (Bill) Roest – Non-Executive Director and
Chair of the Audit and Risk Committee
SENIOR LEADERSHIP TEAM
Simon Mander – Chief Executive Officer
John Fraser-Mackenzie – Chief Financial Officer
Robyn Gibbard – GM Upper North Island
Gareth Hamill – GM Lower North Island
Andrew Dallison – GM South Island
Amandeep Kaur – Group Health and Safety Manager
Barry Paterson – General Manager Commercial Glazing
Dayna Saunders – Human Resources Director
INVESTOR CALENDAR
2019 Annual Shareholders’ Meeting
26 July 2019
2020 Half Year balance date
30 September 2019
2020 Half Year results announcement
2020 Full Year balance date
November 2019
31 March 2020
2020 Full Year results announcement
May 2020
76
METRO PERFORMANCE GLASS LIMITEDANNUAL REPORT 2019 3
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