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Affiliated Managers GroupMILTON CORPORATION LIMITED
ABN 18 000 041 421
An Australian Listed Investment Company
Listed since 1958
ANNUAL REPORT 2013
Profile
Milton was established as a private investment vehicle for four shareholders in 1938. It became a public
company in 1950 and listed on the Sydney Stock Exchange in 1958. Milton is now an investment vehicle for
more than 19,300 shareholders and it is listed on the Australian Securities Exchange under the code MLT.
Objective
Milton’s objective is to hold a diversified portfolio of assets that generates a growing income stream for
distribution to shareholders in the form of increasing fully franked dividends and provides capital growth in the
value of the shareholders’ investments.
Investment philosophy
Milton is predominantly a long term investor in companies and trusts that are well managed, with a profitable
history and an expectation of increasing dividends and distributions. Turnover of investments is low and capital
gains arising from disposals are reinvested.
Milton holds liquid assets such as cash and term deposits and it invests in hybrid securities as well as real
property development through joint ventures.
Milton’s Investment Committee, which comprises three non-executive directors and the managing director,
meets regularly to review the investment portfolio and to consider investment recommendations of its
investment team.
Equity Investment portfolio
Milton’s $2.2 billion equity investment portfolio, which represents 93% of total assets, comprises companies and
trusts which are expected to provide an increase in investment revenue over the long term. Consistent
application of Milton’s investment philosophy over many years has created a portfolio that is not aligned with
any securities exchange index. A list of investments by sector commences on page 7 and the classification of
investments is detailed in the Chairman’s Review on page 4.
Dividend policy
Ordinary fully franked dividends are paid out of profit after tax excluding special investment revenue and
acquisition related costs of subsidiaries. Milton has paid a dividend every year since listing and all dividends
have been fully franked since the introduction of franking. Refer to the dividend history graph on page 6.
Special fully franked dividends may be paid out of special investment revenue when this revenue has
accumulated to a material amount.
Internal management
Milton’s directors oversee the performance of its executives who are employed by the company to manage its
investments. All employees are focussed on operating efficiently and maximising returns to shareholders. This
internal management structure also helps to maintain low operating costs which in the 2013 financial year
represented 0.14% of average total assets.
Contents
Key Performance Indicators
Chairman’s Review of the 2013 Financial Year
Classification of Investments
Milton Corporation Foundation
Five Year Financial Summary
Dividend History
Listed Investments by Sector at 30 June 2013
Directors’ Report
1
2
4
5
6
6
7
11
Remuneration Report
Corporate Governance Statement
Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Directory
ASX Information
14
19
22
45
46
48
49
Calendar
Final dividend:
- Ex dividend date
- Payment date
Share Purchase Plan closes
Annual General Meeting:
- To be held at
15 August 2013
4 September 2013
20 September 2013
10 October 2013 at 3 pm
Australian Institute of Company Directors
Level 1, 10 Bond Street, Sydney
Key performance indicators
Profit after tax ($ million)
This includes the underlying operating profit from the investments as well
as special investment revenue and acquisition related costs of
subsidiaries.
2013
111.2
2012
103.4
Weighted average earnings per share (cents)
91.3
85.0
Profit after tax expressed on a per share basis after taking into account
additional shares issued during the year.
Underlying operating profit after tax ($ million)
108.5
102.7
This represents the ordinary profit from the investments and excludes
special investment revenue and acquisition related costs of subsidiary.
Weighted average underlying operating earnings per share (cents)
89.1
84.4
The underlying operating profit after tax expressed on a per share basis
after taking into account additional shares issued during the year.
Fully franked ordinary dividends per share (cents)
Ordinary fully franked dividends are paid out of underlying operating profit
after tax.
Interim dividend per share
Final dividend per share
Full year dividend per share
Full year ordinary dividend as a percentage of underlying operating profit
after tax.
39.0
43.0
82.0
92.1
38.0
40.0
78.0
92.4
Fully franked special dividend per share (cents)
2.5
-
Special fully franked dividends are paid out of receipts of special
investment income
Net tangible asset value at 30 June ($ million)
2,375.1
1,997.4
The net tangible asset value before providing for tax on unrealised capital
gains.
Net tangible asset backing per share at 30 June ($)
19.45
16.42
The net tangible asset value before providing for tax on unrealised capital
gains expressed on a per share basis.
Management expense ratio (%)
0.14
0.16
The management expense ratio is the total cost of running Milton
expressed as a percentage of the average Total Assets for the year.
Total Shareholder Return (TSR) over 10 years (% per annum)
8.3
6.7
This compound annual return measures the change in the value of an
investment in Milton by considering the movement in the market price and
assuming dividends are reinvested in Milton shares.
1
Chairman’s Review of the 2013 financial year
Profit review
Milton’s net profit after tax for the year ended 30 June 2013 was $111.2 million. This result, which included
special investment revenue of $2.7 million, was 7.5% higher than that of the 2012 financial year.
Whilst Milton usually receives special investment
revenue each year, the amount received can vary
significantly. In the year under review Milton received
special dividends from eight companies with the larger
dividends being $1 million from Westpac, $0.5 million
from Woodside Petroleum and $0.4 million from
Suncorp Group.
Underlying operating profit after tax (UOP) excludes this
irregular income stream and therefore may provide a
better view of the ongoing performance of the company.
UOP in 2013 was $108.5 million with the most
significant factor contributing to the 5.7% increase being
a lift in ordinary franked dividend income.
Milton’s share of net profits from its investments in
property joint ventures also provided a boost to the
result with a contribution of $5 million.
Dividends and distributions
105.8
Up 4.8%
$ million
Change
Interest income
Joint venture profits
Other income
Administration expenses
Underlying operating
profit
Income tax expense
Underlying operating
profit after tax (UOP)
5.6 Down 21.5%
Up 35.6%
flat
5.0
0.8
(3.2)
114.0
(5.5)
108.5
Up 5.7%
Special investment revenue
2.7
Up 255.4%
Net profit after tax
Weighted average eps (1)
Ordinary dividends per share
Special dividends per share
111.2
Cents
89.1
82.0
2.5
Up 7.5%
Up 5.5%
Up 5.1%
Lower interest rates available during the year adversely
affected UOP even though Milton’s cash and term
deposits represented less than 5% of total assets. Total interest earned on these liquid assets held during the
year was $5.6 million some 21.5% lower than in the 2012 year.
(1) Based on underlying operating profit and weighted averages shares on issue
of 121.8 million.
Milton’s total administration expenses remained at $3.2 million and represented 0.14% of average total assets.
The weighted average earnings per share, based on UOP, increased by 5.5% to 89.1 cents.
120
$ millions
100
Retained underlying operating profit
Ordinary dividend
80
60
40
20
0
Dividends
Ordinary
Milton’s dividend policy, which is designed to provide
shareholders with a reliable fully franked income
stream, is to pay a high percentage of UOP to
shareholders as ordinary dividends.
Growth in earnings per share based on UOP has led to
an increase in Milton’s ordinary fully franked dividends
paid to its shareholders. Milton’s ordinary fully franked
interim dividend was 39 cents per share and the
ordinary fully franked final dividend was 43 cents per
share. The full year dividend was 5.1% higher than the
2012 full year dividend.
Special
Milton has a policy to pass on the benefit of the
irregular special dividend receipts once the revenue
has accumulated to a material amount.
A special fully franked dividend of 2.5 cents per share was also declared to be paid with the final dividend in
September 2013. The special dividend was effectively sourced from the special investment revenue received in
2012 and 2013 which totaled $3.4 million.
2
Chairman’s Review of the 2013 financial year (continued)
Net assets
Milton’s net assets, before provision for tax on unrealised
capital gains, were valued at $2.4 billion at 30 June 2013.
The assets included an investment portfolio of Australian
listed equities valued at $2.2 billion and cash including term
deposits of $0.1 billion.
Milton invests for the long term and does not intend to
dispose of its investment portfolio however the accounting
standards require Milton to provide for the capital gains tax
that may arise if the portfolio was realised. At 30 June 2013
that provision was $0.2 billion.
Milton’s net tangible assets per share, before provision for
tax on unrealised capital gains (NTA) were $19.45 at
30 June 2013. This is 18.5% higher than the NTA a year
earlier. The main factor affecting the NTA in 2013 was the
significant increase in value of the long term investment
portfolio.
Movement in Net Assets (1)
for the year ended 30 June 2013
Income before provision for tax
Expenses
Tax expense
Change in value of investments
Total return(1)
$ millions
119.9
(3.2)
(5.5)
352.0
463.2
Net assets 30 June 12 ($16.42 per share)
1,997.4
Share issues
10.6
Dividends paid during the year
(96.1)
Net assets(1) 30 June 13 ($19.45 per share)
2,375.1
(1) before provision for tax on unrealised capital gains
The asset classification table on page 4 identifies each sector’s contribution to this increase in value.
Total returns
Milton’s Total Portfolio Return (TPR), which is the combination of the movement in NTA with the dividends paid
during the year, was 23.6%. The TPR for the ten years ended 30 June 2013 was 9.3% per annum
compounded. These returns are net of all operating costs and realised tax liabilities and are not adjusted for the
value of franking credits attached to Milton’s dividends, which have all been fully franked.
The accumulation returns of the All Ordinaries Index do not include any costs or tax nor are they adjusted for
the partially franked dividends paid. For the year ended 30 June 2013 the accumulation return was 20.7% and
for the ten years it was 9.2% per annum.
Milton’s Total Shareholder Return (TSR) is the combination of the movement in share price and dividends paid
during the year and for the 2013 year it was 26.6%. The TSR for the ten years ended 30 June 2013 was 8.3%
per annum compounded. TSR does not take into account the value of franking credits attached to Milton’s
dividends.
Portfolio
Consistent application of Milton’s investment philosophy over many years has resulted in a portfolio of
investments that can be expected to produce a reliable source of dividends for payment on to shareholders.
The portfolio is not aligned with any index however many of its investments are well represented in the All
Ordinaries Index.
The investment portfolio comprises companies and trusts which are listed on the Australian Securities
Exchange. A full list of the investments is disclosed on pages 7 to 10. These details are also available on
Milton’s website www.milton.com.au and can be downloaded on to a spreadsheet.
During the year Milton invested a further $34 million of which $18 million was funded by disposals. The
acquisition of an unlisted investment company in February 2013 lifted total investments by an additional
$11 million.
The larger purchases included ASX, AP Eagers, Automotive Holdings Group, IOOF Holdings, McMillan
Shakespeare, Tatts Group, Telstra and Westfield Group.
McMillan Shakespeare, which is a well managed, profitable business with a history of paying increasing
dividends was purchased early in the financial year and was performing soundly until the federal government
announced proposed changes to the fringe benefit tax on motor vehicles. These proposals, if enacted, are likely
to have a significant impact on the company’s operations. Milton is monitoring this position carefully.
3
Chairman’s Review of the 2013 financial year (continued)
The following asset classification table shows the composition of Milton’s assets by sector.
Classification(1)
Banks
Consumer staples
Materials
Energy
Commercial services
Insurance
Diversified financials
Telecommunications
Capital goods
Real estate
Other shares
Utilities
Healthcare
Retailing
Media
Opening
position
Additions(4)
Disposals
Change in
value
Closing
position
Income
$ million
$ million
$ million
$ million
$ million
$ million
636.6
206.7
202.5
181.2
128.3
91.7
77.3
49.9
49.1
44.6
40.2
39.4
34.2
31.2
12.3
4.7
5.6
3.5
2.2
1.2
1.9
4.0
6.3
3.4
5.3
2.4
-
1.1
2.8
-
-
(3.6)
(0.8)
(0.7)
(0.5)
(3.8)
-
-
(1.6)
(5.5)
(0.3)
-
-
(0.3)
(1.3)
203.7
46.0
12.1
(1.8)
(11.5)
27.7
28.7
20.3
(11.3)
4.4
9.4
0.5
15.6
6.8
0.7
845.0
254.7
217.3
180.9
117.5
117.5
110.0
76.5
39.6
48.8
51.7
39.9
50.9
40.5
11.7
48.3
11.9
7.4
6.1
5.8
4.6
4.6
3.8
2.8
2.8
2.1
1.8
1.0
1.8
0.6
Total listed investments
1,825.2
44.5
(18.4)
351.2
2,202.5
105.4
Cash & liquids(2)
Other assets(3)
Total
132.2
45.4
2002.8
129.0
46.6
5.6
8.9
2,378.1
119.9
(1)
Investments are grouped according to their asset classes using the Global Industry Classification Standard (“GICS”) codes. Full details
of the investments at 30 June 2013 are reported on pages 7 to 10.
(2) Cash & liquid assets include cash, term deposits and hybrid securities.
(3) Other assets include receivables and investments in real property development through joint ventures.
(4) Additions include investments that were held by the unlisted investment company that was acquired on 21 February 2013.
Share Purchase Plan
Directors announced on 25 July 2013 the reintroduction of the Share Purchase Plan (SPP) with participation to
be offered to shareholders on the register on 24 July 2013. The SPP enables shareholders to apply for new
shares with a total market value of up to $15,000. The new shares will be issued at a discount of 2.5% to the
volume weighted average share price for the three days immediately after the shares trade ex dividend.
Share split proposal
With Milton’s share price and NTA approaching $20 per share a proposal to split the shares in the ratio of five
new shares for each existing share will be put to shareholders at the company’s annual general meeting. It is
anticipated that the share split will improve the liquidity in the trading of Milton’s shares and will make Milton
shares more attractive to a greater number of investors.
4
Chairman’s Review of the 2013 financial year (continued)
Outlook
Many Australian corporates faced with challenging business conditions have taken steps to restructure their
businesses and lower their cost bases so that they should be in a sound position as the economy improves
over time.
It is expected that the benefits of a lower currency and continuing low interest rates will eventually provide the
stimulus required to strengthen the economy.
In the meantime Milton will continue to actively seek opportunities to add to its portfolio.
In the absence of unforeseen circumstances directors expect to be able to at least maintain the ordinary annual
dividend rate of 82 cents per share. (Should the share split proceed the equivalent dividend would be
16.4 cents per share on the expanded number of shares on issue.)
R. D. MILLNER
Chairman
Sydney, 8 August 2013
Milton Corporation Foundation (ABN 95 051 921 133)
The Foundation was established in 1988 to support charitable organisations, particularly those which direct
assistance to persons that are disadvantaged in the community.
The objective is to create a vehicle with sufficient capital that can make regular meaningful donations from the
earnings derived from its investments. Contributions from Milton, shareholders and others over the years have
helped to grow the Foundation’s total assets at 30 June 2013 to $1.9 million.
In 2013 the Foundation distributed $100,000 to support 13 organisations. The Foundation has provided $1.7
million of assistance to the community since its establishment.
The Foundation is a deductible gift recipient and donations of $2 or more are tax deductible.
If you are interested in supporting the Foundation donations and can be made by forwarding a cheque to:
The Trustees, Milton Corporation Foundation, PO Box R1836, Royal Exchange NSW 1225.
J F Church
Chairman of Trustees
Sydney, 8 August 2013
5
Five Year Financial Summary
Underlying operating profit after tax(1) ($million)
Underlying earnings per share (cents)
Profit after tax ($million)
Earnings per share (cents)
Administration costs as % of average total assets
Interim dividend (cents per share)
Final dividend (cents per share)*
Full year ordinary dividend (cents per share)
Special dividend (cents per share)
*LIC Capital Gain paid as part of final dividend
(cents per share)
Net assets(2) at 30 June ($million)
Net asset backing per share(2) at 30 June($)
Net asset backing per share(3) at 30 June($)
Last sale price at 30 June ($)
All Ordinaries Index at 30 June
Ten year Total Shareholder Return (% per annum)
Five year Total Shareholder Return (% per annum)
Shares on issue (million)
Number of shareholders
2013
2012
2011
2010
2009
108.5
102.7
89.1
84.4
111.2
103.4
91.3
0.14
39.0
43.0
82.0
2.5
-
2,375
19.45
17.62
18.40
4775
8.3
4.0
85.0
0.16
38.0
40.0
78.0
-
-
1,997
16.42
15.46
15.21
4135
6.7
(3.0)
90.5
80.8
93.9
83.9
0.17
37.0
39.0
76.0
5.0
-
2,112
17.36
16.11
15.60
4660
7.8
(0.4)
122.1
121.6
123.3
68.9
73.7
73.1
78.2
0.17
35.0
36.0
71.0
-
2.0
1,603
16.51
15.17
15.98
4325
10.7
4.0
97.1
73.6
85.0
69.4
80.1
0.19
43.0
35.0
78.0
-
-
1,338
15.04
13.98
14.50
3948
9.8
6.0
88.9
19,309
19,008
19,490
15,890
14,578
(1) Underlying operating profit after tax excludes special investment revenue, acquisition related costs of subsidiaries and realised
capital gains and losses.
(2) Before provision for tax on unrealised capital gains net of tax on unrealised capital losses and before providing for the ordinary final
and special dividends.
(3) After provision for tax on unrealised capital gains net of tax on realised capital losses and before providing for the ordinary final and
special dividends.
Milton dividend history
The growth in Milton’s dividends since the company was listed in 1958 is shown in the chart below.
The dividends are based on the following assumptions:
o 1,000 shares were purchased for £1,000 ($2,000) in 1958
o Dividends were NOT reinvested and
o NO further shares have been purchased.
Through the sub-division of shares on the introduction of decimal currency and bonus share issues, the number
of shares held would have increased to 5,706 and would have been valued at $104,990 at 30 June 2013. The
annual dividend on these shares would have increased to $4,679 in 2013 from $160 in 1959.
Fully franked since franking was introduced in 1987
Ordinary dividend
Special dividend
$4,679
$6,000
$5,000
$4,000
$3,000
$2,000
$1,000
$0
6
LISTED INVESTMENTS BY SECTOR AT 30 JUNE 2013
Holding
Fair Value
$'000
Banks
Australia & New Zealand Banking Group Limited
- ordinary shares
- convertible preference shares
- CPS 1
Bendigo and Adelaide Bank Limited
Bank of Queensland Limited
Commonwealth Bank of Australia
- ordinary shares
- PERLS V
National Australia Bank Limited
MyState Limited
Wide Bay Australia Limited
Westpac Banking Corporation
Consumer Staples
Blackmores Limited
Coca-Cola Amatil Limited
Graincorp Limited
Metcash Limited
Select Harvests Limited
Treasury Wine Estates Limited
Wesfarmers Limited
Wesfarmers Limited Partially Protected
Woolworths Limited
Materials
Adelaide Brighton Limited
Alumina Limited
Amcor Limited
Arrium Limited
BHP Billiton Limited
Boral Limited
Brickworks Limited
DuluxGroup Limited
Fletcher Building Limited
Incitec Pivot Limited
Orica Limited
Rio Tinto Limited
Sims Metal Management Limited
7
2,890,035
19,500
2,000
5,709,709
6,550,276
3,028,075
500
4,386,788
444,992
433,570
10,447,684
378,014
1,367,184
338,290
4,657,560
161,862
1,023,271
2,606,937
260,685
2,630,973
2,098,440
491,919
1,173,322
3,995,301
3,258,296
1,627,463
3,234,567
74,000
803,229
1,529,770
188,987
454,888
793,037
82,597
1,975
199
57,497
57,053
209,482
101
130,200
1,887
2,276
301,729
844,997
10,184
17,377
4,235
16,395
529
5,955
103,235
10,516
86,322
254,748
6,925
485
11,897
3,116
102,213
6,852
41,079
312
5,735
4,375
3,903
23,822
6,550
217,264
LISTED INVESTMENTS BY SECTOR AT 30 JUNE 2013
Energy
New Hope Corporation Limited
Origin Energy Limited
Santos Limited
Woodside Petroleum Limited
Washington H Soul Pattinson & Company Limited
Worley Parsons Limited
Commercial Services
ALS Limited (formerly Campbell Brothers)
Brambles Limited
McMillan Shakespeare Limited
Transfield Services Limited
Insurance
AMP Limited
Austbrokers Limited
Insurance Australia Group Limited
- ordinary shares
- convertible preference shares
IAG Finance (NZ) Limited perpetual reset exchangeable notes
QBE Insurance Group Limited
Suncorp Group Limited
Diversified Financials
Argo Investments Limited
ASX Limited
Australian Foundation Investment Company Limited
BKI Investment Company Limited
Carlton Investments Limited
Diversified United Investment Limited
Equity Trustees Limited
IOOF Holdings Limited
Macquarie Group Limited
Perpetual Limited
The Trust Company Limited
Telecommunication
Telstra Corporation Limited
TPG Telecom Limited
8
Holding
1,290,107
387,106
1,407,056
821,175
9,134,840
252,612
10,840,825
1,167,966
100,000
1,519,032
2,121,110
1,024,795
3,782,575
3,000
12,000
2,743,375
2,832,882
809,094
451,724
1,304,250
1,147,375
354,809
270,400
235,503
448,067
494,118
824,126
2,940,394
13,280,253
3,731,553
Fair Value
$ 000
4,606
4,866
17,630
28,749
120,123
4,923
180,898
103,855
10,909
1,618
1,170
117,552
9,015
11,170
20,577
306
1,234
41,398
33,768
117,467
5,227
14,939
7,095
1,629
7,486
811
3,509
3,298
20,689
29,174
16,143
110,000
63,347
13,135
76,482
LISTED INVESTMENTS BY SECTOR AT 30 JUNE 2013
Healthcare
Cochlear Limited
CSL Limited
Ramsay Health Care Limited
Sonic Healthcare Limited
Real Estate
Australand Property Group
BWP Trust
CFS Retail Property Trust
Commonwealth Property Office Fund
Finbar Group Limited
FKP Property Group
Goodman Group
Lend Lease Corporation Limited
Stockland Group
Westfield Group
Westfield Retail Trust
Capital Goods
Bradken Limited
Cardno Limited
GWA International Limited
Leighton Holdings Limited
Reece Australia Limited
Sedgman Limited
UGL Limited
Retailing
AP Eagers Limited
ARB Corporation Limited
Automotive Holdings Group Limited
David Jones Limited
Noni B Limited
Premier Investments Limited
Utilities
AGL Energy Limited
APA Group
9
Holding
31,800
587,062
104,942
608,494
832,732
1,363,394
7,971,000
1,724,537
1,180,000
963,181
184,756
448,216
2,150,940
672,000
784,873
806,184
896,890
2,275,000
757,865
133,085
2,021,674
1,451,191
5,833,107
744,741
1,334,260
356,090
867,396
385,250
2,304,752
1,083,833
Fair Value
$ 000
1,962
36,151
3,758
9,012
50,883
2,898
3,068
15,942
1,897
1,481
1,223
902
3,743
7,485
7,688
2,433
48,759
3,475
4,646
5,460
11,709
3,167
1,071
10,042
39,571
23,741
8,490
4,270
908
520
2,573
40,502
33,373
6,492
39,865
LISTED INVESTMENTS BY SECTOR AT 30 JUNE 2013
Consumer Services
Crown Limited
InvoCare Limited
Tatts Group Limited
Transport
Lindsay Australia Limited
Qube Logistics Holdings Limited
Sydney Airport
Transurban Group
Toll Holdings Limited
Media
Amalgamated Holdings Ltd
APN News & Media Limited
Fairfax Media Limited
Seven Group Holdings Limited – TELYS4 preference shares
Seven West Media Limited
Automobiles & Components
Fleetwood Corporation Limited
Schaffer Corporation Limited
Holding
267,301
1,695,526
1,112,918
1,600,000
1,368,000
432,301
2,157,081
1,130,679
740,667
1,309,855
3,231,643
7,000
1,619,110
228,000
68,999
Fair Value
$ 000
3,237
19,295
3,528
26,060
280
2,278
1,461
14,582
6,015
24,616
6,125
327
1,600
593
3,076
11,722
821
298
1,119
Total Listed Investments by Sector
2,202,504
10
Directors’ Report
For the year ended 30 June 2013
The directors present their report together with the financial statements of the consolidated entity (“Milton”)
consisting of Milton Corporation Limited and its subsidiaries for the financial year ended 30 June 2013 and the
independent auditor’s report thereon.
Directors
The directors of Milton at any time during or since the end of the financial year are:
Robert D. Millner FAICD Independent non-executive chairman.
Director of Milton Corporation Limited since 1998 and appointed chairman in 2002.
Chairman of the Investment and Remuneration Committees. Extensive experience in the investment industry.
Other current directorships:
Director of Australian Pharmaceutical Industries Limited since 2000, Chairman of BKI Investment Company
Limited since 2003, Director of Brickworks Limited since 1997 and appointed chairman in 1999, Director of New
Hope Corporation Limited since 1995 and appointed chairman in 1998, Director of TPG Telecom Limited since
2000, Director of Washington H. Soul Pattinson & Company Limited since 1984 and appointed chairman in 1998.
Former directorships in the last three years:
Souls Private Equity Limited from 2004 to 2012
Northern Energy Corporation Limited from February 2011 and the company was delisted in October 2011.
John F. Church FCSA, F Fin, FAICD Independent non-executive director.
Director of Milton Corporation Limited since 1986.
Member of the Investment Committee.
A Solicitor and Notary Public and over 40 years experience in the investment industry.
Graeme L. Crampton B.Ec, FCA, FAICD Independent non-executive director.
Director of Milton Corporation Limited since 2009.
Chairman of the Audit Committee and a member of the Remuneration Committee.
A Chartered Accountant and former partner of a major firm of Chartered Accountants for more than 30 years and
has extensive experience in the investment industry.
Former directorships in the last three years:
Souls Private Equity Limited from 2011 to 2012.
Kevin J. Eley CA, F Fin Independent non-executive director.
Director of Milton Corporation Limited since 2011.
Member of the Investment and Audit Committees.
A Chartered Accountant and has extensive experience in the investment industry.
Other current directorships:
Director of Equity Trustees Limited since 2011, HGL Limited since 1985, Kresta Holdings Limited since 2011 and
PO Valley Energy Limited since 2012.
Francis G. Gooch B.Bus, CPA Managing director.
Managing Director of Milton Corporation Limited since 2004 and chief executive since 1999.
Member of the Investment Committee.
A Certified Practising Accountant and over 28 years experience in the finance and investment industries.
Ian A. Pollard BA (Macq), MA (Oxon), D Phil (IMC), FIAA, FAICD Independent non-executive director.
Director of Milton Corporation Limited since 1998.
Member of the Audit and Remuneration Committees.
An Actuary and over 36 years of involvement in the investment industry.
Other current directorships:
Director and Chairman of Billabong International Limited since 2012 and Director of SCA Property Group since
2012
11
Directors’ meetings
The number of directors’ meetings (including meetings of committees of directors) and the number of meetings
attended by each of the directors of Milton during the financial year were:
Director
Directors’
Meetings
Investment
Committee Meetings
Audit
Committee
Meetings
Nomination
Committee
Meetings
Remuneration
Committee
Meetings
R.D. Millner
J.F. Church
G.L. Crampton
K.J. Eley
F.G. Gooch
I.A. Pollard
A
6
6
6
6
6
6
B
6
6
6
6
6
6
A
18
17
*
19
19
*
B
19
19
*
19
19
*
A
*
*
5
5
*
4
B
*
*
5
5
*
5
A
*
1
*
*
1
1
B
*
1
*
*
1
1
A
1
*
1
*
*
1
B
1
*
1
*
*
1
A - Number of meetings attended.
B - Number of meetings held during the time the director held office or was a member of the committee during the year.
* - Not a member of the relevant committee.
Principal activities
The principal activity of Milton is investment. Milton invests in companies and trusts, real property development,
fixed interest securities, and liquid assets such as cash and term deposits. There has been no significant
change in the nature of this activity during the financial year.
Operating and financial review
The consolidated profit after income tax of Milton for the year was $111.2 million (2012: $103.4 million). Milton
is in a sound financial position with net assets at 30 June 2013 of $2.2 billion (2012: $1.9 billion) and no debt.
The operating and financial reviews are contained in the Chairman’s Review on page 2.
Significant changes in the state of affairs
There were no significant changes in the state of affairs of Milton during the past financial year other than as
disclosed in the financial statements.
Dividends
Dividends paid or declared by Milton to members since the end of the previous financial year were:
Declared and paid during the year
- Final 2012 ordinary fully franked
- Interim 2013 ordinary fully franked
Declared after end of year and not provided for
- Final 2013 ordinary fully franked
- Special 2013 fully franked
Cents
per share
Total amount
$’000
Date of payment
40.0
39.0
43.0
2.5
48,650
47,434
52,523
3,054
4 September 2012
6 March 2013
4 September 2013
4 September 2013
No LIC capital gain was included in the above dividends.
All the dividends paid by Milton since franking was introduced in 1987 have been fully franked.
Events subsequent to reporting date
Apart from the information contained in note 24 to the financial statements, no matter or circumstance has
arisen since the end of the financial year that has or may significantly affect the operations, results or state of
affairs of Milton in subsequent financial years.
12
Likely developments
Milton will continue its investment activities consistent with its objective of generating increasing revenue for
distribution to its shareholders from its diversified portfolio of assets.
The performance of Milton’s investments is subject to and influenced by many external factors and therefore it
is not appropriate to predict the future results of the investments and Milton’s performance.
The Chairman’s Review commencing on page 2 of the Annual Report contains information relating to Milton’s
past performance, operations and outlook.
Environmental regulations
There are no significant environmental regulations that apply directly to Milton.
Directors’ relevant interests
No director has or has had any interest in a contract entered into since the last Directors’ Report or any contract
or proposed contract with Milton or any subsidiary or any related entity other than as disclosed in note 22 to the
financial statements.
The relevant interest of each director in the capital of Milton at the date of this report is as follows:
Director
R.D. Millner
J.F. Church
G.L. Crampton
K.J. Eley
F.G. Gooch
I.A. Pollard
No. of Shares
2,558,105
5,693,009
27,307
20,000
145,013
16,724
Indemnification and insurance of directors, officers and auditors
Neither Milton nor any related entity has indemnified or agreed to indemnify, paid or agreed to pay any
insurance premium which would be prohibited under Section 199A or Section 199B of the Corporations Act
2001 during or since the financial year ended 30 June 2013.
The directors have not included details of the nature of the liabilities covered or the amount of the premium paid
in respect of the directors’ and officers’ liability and legal expenses insurance contracts as such disclosure is
prohibited under the terms of the contracts.
Secretary
Mr D.N. Seneviratne MBA, ACMA, CPA, AICM was appointed secretary in December 2012. He held the role of
senior accountant at Milton since March 2010 and was appointed assistant company secretary in March 2012.
Previously he has held the roles of finance controller and finance manager in private companies for over 6
years and prior to that worked in areas of corporate finance for over 4 years. He is a member of CIMA, CPA
and a graduate diploma student of Chartered Secretaries of Australia.
Mr. A.R. Davison, B.Bus, CA, FCSA who served as secretary from August 1999 to December 2012 retired from
Milton with effect from 15 April 2013.
Non-audit services
During the year, Moore Stephens Sydney, Milton’s auditor, has performed certain non-audit services in addition
to its statutory duties. Details of the amounts paid to the auditors and related practices of the auditor are
disclosed in note 4 to the consolidated financial statements.
The board has considered the non-audit services provided during the year by the auditor and is satisfied that
the provision of those non-audit services during the year by the auditor is compatible with, and did not
compromise, the auditor independence requirements of the Corporations Act 2001 for the following reasons:
- All non-audit services were subject to the corporate governance procedures adopted by Milton and
have been reviewed and approved by the Audit Committee to ensure they do not impact on the
integrity and objectivity of the auditor, and
- The non-audit services provided do not undermine the general principles relating to auditor
independence as set out in Professional Statement APES110 Code of Ethics for Professional
Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a
management or decision making capacity for Milton, acting as an advocate for Milton or jointly sharing
risks and rewards.
The auditor’s independence declaration as required under Section 307C of the Corporations Act 2001 is set out
on page 18.
13
Remuneration Report
This report, which is audited, details the policy for determining the remuneration of directors and executives and
provides specific detail of their remuneration.
Remuneration of non-executive directors
Non-executive directors are paid base fees, committee fees and superannuation contributions.
Fees are not linked to Milton’s performance and no bonuses are paid or options issued.
Each year the base fees and committee fees are determined by the board of directors who take into account
the demands made on directors and the remuneration of non executive directors of comparable Australian
companies.
Base fees and committee fees (including superannuation contributions)
Chairman base fee
Director base fee
Chairman of the Audit Committee fee
Member of the Audit Committee fee
Member of the Investment Committee fee
2012
118,650
59,325
5,250
2,975
5,250
2013
124,580
62,290
5,512
3,125
5,512
The total remuneration paid to non executive directors in 2013 was $402,038 (2012: $373,980).
In October 2011 shareholders approved the fixed maximum sum of $700,000.
Non-executive directors, who were appointed before 30 June 2003, are entitled to retirement benefits in
accordance with a shareholder approved scheme. In June 2003 the board resolved to cap retirement benefits
for all directors at the amounts provided as at 30 June 2003. The total balance provided at 30 June 2013 is
$190,905 (2012: $190,905).
Remuneration of executives
Executive remuneration is a key element of Milton’s staff retention strategy which is designed to attract and
retain appropriately qualified and experienced professionals who share Milton’s goals and values and will seek
to deliver superior long term returns to Milton shareholders.
The remuneration of the managing director and senior executives is reviewed annually by the Remuneration
Committee which then makes recommendations to the board for its consideration and approval.
In formulating its recommendations the Remuneration Committee considers:
• the short term and long term performance of the Company,
• the contribution of the managing director and the senior executives to this performance,
• market trends in remuneration in terms of both quantum and structure and
• the remuneration of key management personnel of other listed investment companies with similar long
term investment philosophies and objectives.
Executive remuneration includes a component known as the Total Employment Cost Package (TECP), and it
may include a cash bonus component and an equity component.
The TECP includes cash salary, company contributions to superannuation and it may include non monetary
benefits such as the provision of a motor vehicle and car parking.
No executive is entitled to a guaranteed bonus however the board may award a cash bonus to reward an
executive’s outstanding contribution to the achievement of Milton’s objectives. The board will consider
qualitative measures such as contribution to the investment process, participation in board discussions,
timeliness and accuracy of reports and staff development when assessing executive performance.
In determining the amount of any bonus the board has regard to quantitative measures such as underlying
operating earnings per share, dividends per share and total returns relative to the market as a whole. The cash
bonus is normally less than 10% of each executive’s TECP.
The equity component of the remuneration package encourages executives to have an investment in Milton so
that their interests are aligned with the shareholders’ interests.
The equity component is delivered through participation in the Senior Staff Share Plan (“SSSP”), which was
approved by shareholders at Milton’s Annual General Meeting on 9 October 2001 (refer note 17b to the
financial statements).
In accordance with the terms of the SSSP, the directors determine the maximum number of shares for which
the executive may apply. All SSSP shares are acquired on the market and held on behalf of the executives by
the trustee of the SSSP. The price offered to the executive shall be at a discount of one cent per share to the
market value of the shares.
14
Executives are required to hold the SSSP shares for a minimum period of three years however the benefit to
the executive is increased through long term ownership as dividends are paid and the Milton share price
appreciates.
Milton provides an interest free loan to the executives to fund the acquisition of each parcel of SSSP shares.
Each loan is repaid by the application of the after tax proceeds from the dividends paid on the SSSP shares.
The opportunity cost to Milton of providing the loan is the notional interest. The Remuneration Committee
includes this cost when it reviews each executive’s TECP.
SSSP shares may not be sold, transferred, mortgaged or otherwise dealt with by the executive for a period of
three years from the date of issue or until the executive ceases employment with Milton.
If the executive’s employment ceases, the executive may within 30 days repay the loan and direct the trustee to
transfer the shares to the executive or, provided the value of the shares is greater than the loan outstanding,
direct the trustee to sell the shares, repay the loan and distribute the balance to the executive. Otherwise the
trustee will sell the shares when so directed by Milton and apply the proceeds to the repayment of the loan.
The board considers that the SSSP is appropriately designed to encourage long term ownership of shares by
executives, which then aligns their interests with that of Milton’s predominantly long term shareholder base.
Executives, other than the managing director, may participate in the Employee Share Plan (“ESP”) which
provides for a bonus of up to $1,000 to be paid in the form of Milton shares (refer note 17a to the financial
statements).
Eligible executives are provided with life, total and permanent disablement and salary continuance insurance.
The overall level of executive reward takes into account the performance of Milton over a number of years. Key
performance indicators for Milton over five years are tabled below.
Key performance indicators
Profitability
2013
2012
2011
2010
2009
Underlying operating profit ($million)
108.5
102.7
Growth in underlying operating profit (%)
Underlying earnings per share (cents)
Growth in underlying earnings per share (%)
Dividend
Full year ordinary dividend (cents per share)
Growth in full year ordinary dividend (%)
Special dividend (cents per share)
Capital
Net asset backing per share(1) at 30 June($)
Growth (decline) in net asset backing per share (%)
Net assets(1) at 30 June ($million)
Total Return
Ten year Total Shareholder Return
Ten year Total Portfolio Return
Ten year accumulation return
of the All Ordinaries Index
5.7
89.1
5.5
82.0
5.1
2.5
13.5
84.4
4.5
78.0
2.6
-
19.45
16.42
18.4
(5.4)
2,375
1,997
8.3
9.3
9.2
6.7
7.5
7.1
90.5
31.3
80.8
9.6
76.0
7.0
5.0
17.36
5.1
2,112
7.8
8.5
7.4
68.9
73.6
(6.4)
(11.1)
73.7
85.0
(13.3)
(13.8)
71.0
78.0
(9.0)
(11.4)
-
-
16.51
15.04
9.3
(20.6)
1,603
1,338
10.7
10.2
9.8
9.4
7.1
7.3
(1) Before provision for tax on unrealised capital gains net of tax on realised capital losses and before providing for the ordinary final
dividend.
15
Details of remuneration
Amounts of remuneration
Details of the remuneration of each non-executive director of Milton Corporation Limited, the managing director
and specified executives of Milton for the years ended 30 June 2012 and 2013 are set out in the following
tables.
Non-executive directors of Milton Corporation Limited
R.D. Millner
Chairman
J.F. Church
Director
G.L. Crampton
Director
K.J. Eley
(appointed 1/12/11)
I.A. Pollard
J.N. Aitken (2)
(retired 13/10/11)
Total remuneration
Director
Director
Director
2013
2012
2013
2012
2013
2012
2013
2012
2013
2012
2013
2012
2013
2012
Short
Term
Benefits
Fees
$
119,350
113,670
62,204
59,243
43,802
19,575
65,071
27,574
60,014
57,156
-
12,831
350,441
290,049
Post
Employment
Superannuation
Total
paid
Retirement
Provision(1)
$
10,742
10,230
5,598
5,332
24,000
45,000
5,856
11,830
5,401
5,144
-
6,395
51,597
83,931
$
130,092
123,900
67,802
64,575
67,802
64,575
70,927
39,404
65,415
62,300
-
19,226
402,038
373,980
$
55,905
55,905
90,000
90,000
-
-
-
-
45,000
45,000
-
-
190,995
190,995
(1) The directors’ retirement benefits have been capped at the balance provided at 30 June 2003.
(2) Mr J.N. Aitken retired as a director on 13 October 2011.
Managing director and executives of Milton Corporation Limited and its subsidiaries
Short Term Benefits
Salary
Cash
bonus
$
2013
2012
443,741
388,497
2013
2012
122,340
-
(1)
$
25,000
20,500
13,761
-
2013
2012
2013
2012
140,004
181,999
-
5,000
706,085
570,496
38,761
25,500
Non
monetary
benefits
(2)
$
41,910
49,788
-
-
2,812
3,552
44,722
53,340
Post
Employ-
ment
Super-
annuation
$
20,008
45,065
12,249
-
15,308
46,000
47,565
91,065
Other
long term
benefits
(3)
Share
based
payments
Total
(4)
$
132,885
131,819
4,540
-
$
18,325
12,422
-
-
$
681,869
648,091
152,890
-
4,025
4,626
25,583
52,369
187,732
293,546
22,350
17,048
163,008
184,188
1,022,491
941,637
F.G. Gooch
Managing director
D.N. Seneviratne (5)
CFO, secretary
(appointed 21/12/12)
A.R. Davison
CFO, secretary
(resigned 15/04/13)
Total
remuneration
(1) Represents 100% of cash bonus paid or payable which vested in the year.
(2) Non monetary benefits include the provision of a motor vehicle, parking, the cost of life, total & permanent disablement
insurance and salary continuance insurance provided through nominated superannuation funds.
(3) Other long term benefits are comprised of long service leave provisions.
(4) Represents the notional value of interest on loans provided to acquire shares in Milton under the Senior Staff Share
Plan and cost of shares purchased under the Employee Share Plan.
(5) Mr Seneviratne joined Milton in March 2010 and was appointed CFO/Secretary on 21/12/12. His remuneration includes
the total remuneration for the reporting period from 01/07/12 to 30/06/13.
There are no fixed term employment contracts between Milton and its employees. Employment may be
terminated with four weeks notice by either Milton or the employee. There are no provisions for any termination
payments other than for unpaid annual and long service leave.
16
Share based compensation, Senior Staff Share Plan equity holdings and loans
The movements during the reporting period are as follows:
Executives’ shareholdings in relation to the Senior Staff Share Plan - Number of shares held
F.G. Gooch
Managing director
D.N. Seneviratne
CFO, secretary
(appointed 21/12/12)
A.R. Davison
CFO, secretary
(resigned 15/04/13)
Opening
Balance
125,000
105,000
3,500
-
47,500
42,500
2013
2012
2013
2012
2013
2012
Received as
Remuneration
15,000
10,000
-
-
-
5,000
Closing
Balance
140,000
125,000
3,500
-
-
47,500
Loans in relation to the Senior Staff Share Plan
Details regarding loans outstanding at the reporting date to specified directors and specified executives, are as
follows:
F.G. Gooch
Managing director
D.N. Seneviratne
CFO, secretary
(appointed 21/12/12)
A.R. Davison
CFO, secretary
(resigned 15/04/13)
2013
2012
2013
2012
2013
2012
Opening
Balance
Net
change
$
1,683,932
1,460,406
50,635
-
$
156,388
223,526
2,114
-
Closing
Balance
$
1,840,320
1,683,932
48,521
-
Highest
balance in
the period
$
1,920,264
1,762,271
50,635
-
Notional
Interest
(1)
$
132,885
131,819
3,540
-
665,824
620,126
(665,824)
45,698
-
665,824
665,824
695,593
25,583
52,369
(1) The notional interest has been included under “Share Based Payment” in the remuneration of the
managing director and the executive disclosed on page 16. Notional interest is based on the applicable
FBT benchmark interest rate, which for the year averaged 7.18% (2012: 7.8%).
Terms and conditions of the loans are referred to in note 17b to the financial statements.
Rounding off
The company is of a kind referred to in Class Order 98/100 issued by the Australian Securities & Investments
Commission and in accordance with that Class Order, amounts in the Directors’ Report and financial report
have been rounded off to the nearest thousand dollars, unless otherwise stated.
Signed in accordance with a resolution of the directors.
R. D. MILLNER
Chairman
Sydney, 8 August 2013
17
Level 15, 135 King Street
Sydney NSW 2000
T +61 (0)2 8236 7700
F +61 (0)2 9233 4636
www.moorestephens.com.au
Auditor’s Independence Declaration
to the Directors of Milton Corporation Limited
In accordance with the requirements of section 307C of the Corporations Act 2001 , as lead auditor for
the audit of Milton Corporation Limited for the year ended 30 June 2013, I declare that, to the best of
my knowledge and belief, there have been:
a) no contraventions of the auditor independence requirements of the
Corporations Act 2001 in
relation to the audit; and
b) no contraventions of any applicable code of professional conduct in relation to the audit.
Moore Stephens Sydney
Chartered Accountants
Martin J. (Joe) Shannon
Partner
Dated in Sydney this 8th day of August 2013.
Moore Stephens Sydney ABN 90 773 984 843.
Liability limited by a scheme approved under Professional Standards Legislation*
*Other than for the acts or omissions of financial services licensees. An independent member of Moore Stephens International Limited -
members in principal cities throughout the world The Sydney Moore Stephens firm is not a partner or agent of any other Moore Stephens firm.
18
Corporate Governance Statement
This statement outlines Milton’s main corporate governance practices which have been in place
throughout the financial year.
The board considers it essential that directors and staff of Milton employ sound corporate governance
practices in carrying out their duties and responsibilities. Accordingly a code of conduct has been
issued to detail the expected behaviour required to ensure Milton acts with integrity and objectivity.
A number of committees, which operate in accordance with their respective charters, have been
established to assist the board in carrying out its responsibilities.
Milton has placed its corporate governance statement on its website: www.milton.com.au. The board
charter, code of conduct, audit, nomination and remuneration committee charters and share trading,
communication, disclosure, performance evaluation and risk management policies are available on this
website.
The ASX Corporate Governance Council released its “Principles of Good Corporate Governance and
Best Practice Recommendations” (“Recommendations”) in March 2003 and these were revised in
August 2007 and in June 2010. The directors of Milton support the thrust of the Recommendations and,
whilst the Recommendations are not prescriptive, the ASX Listing Rules require listed companies to
identify those Recommendations that have not been followed and the reasons for not following them.
The directors consider that Milton’s corporate governance practices do comply with the
Recommendations.
Board of directors
The board charter details the composition and the role and responsibilities of the board and their
relationship with management to accomplish the board's primary role of promoting the long-term
success of Milton.
The board is accountable to shareholders for the performance of Milton. It oversees the activities and
performance of management and provides an independent and objective view of Milton’s performance.
The board is comprised of a majority of independent non-executive directors and one executive director
with a mix of skills and considerable experience in the investment industry.
The details of the directors, their experience, qualifications, term of office and independent status are
set out in the Directors’ Report.
The Recommendations state that to be considered independent, a director must be “a non-executive
director who is not a member of management and who is free of any business or other relationship that
could materially interfere with (or could reasonably be perceived to materially interfere with) the
independent exercise of their judgement.”
All directors except Mr R. D. Millner would satisfy all the tests of the Recommendations and are
considered as being independent.
The Recommendations state that the determination of the independence of a director is to be dealt with
by the board of directors who are to consider all relevant facts and circumstances on a case by case
basis.
Milton’s chairman, Mr R. D. Millner, is also chairman of Washington H Soul Pattinson & Co Limited, a
substantial shareholder of Milton. The Washington H Soul Pattinson holding of less than 6% of Milton’s
issued capital represents less than 5% of Washington H Soul Pattinson’s assets and therefore the
board considers it is unlikely to impact the chairman’s independence.
The board is strongly of the opinion that the thinking and actions of Mr R. D. Millner and his
commitment to represent the interests of all shareholders is not impaired, and he is considered by the
board as a whole to be independent.
In accordance with the Corporations Act 2001, any director who has an interest of any kind in relation to
any matter dealt with at a board or committee meeting is required to advise the meeting and abstain
from participation in the decision process.
All non-executive directors are subject to re-election at least every three years.
Independent professional advice may be sought by a director at Milton’s expense with the prior
approval of the chairman. A copy of advice received by the director is made available to the chairman
to be dealt with at his discretion.
The board meets regularly to review management reports on the investment portfolio and on the
operational and financial performance of Milton.
19
The directors agreed in 2003 to phase out retirement benefits, with the amount to be paid to each
director upon retirement limited to the provision in the financial statements as at 30 June 2003, details
of which are disclosed on page 16.
Board committees
The board has established committees to assist it in carrying out its responsibilities. The charters that
identify the roles and responsibilities of the following committees have been approved by the board and
are available on Milton’s web site.
The Audit Committee, consisting of at least three independent non-executive directors, reviews the
effectiveness of the risk management and internal controls, the reliability of financial information and the
appointment and effectiveness of the external auditor. To assist in this function the committee may
invite the external auditor and senior executives to report to meetings. Any significant non-audit
services to be provided by the external auditors must be approved in advance by the Audit Committee.
The Audit Committee considers that the provision of those non-audit services provided to date by the
external auditor would not affect the auditor’s independence.
The Investment Committee, consisting of three independent non-executive directors and the managing
director, meets regularly to review the investment portfolio and to make investment decisions within
defined limits. All directors may attend the Investment Committee meetings. The defined limits are
reviewed by the board from time to time.
The Nomination Committee consists of those directors who are not seeking re-election. This committee
reviews the composition of the board annually and makes recommendations on the appropriate skill
mix, personal qualities, expertise and diversity. The committee having reviewed the performance of the
directors recommended Dr I. A. Pollard for election at the 2013 annual general meeting.
The Remuneration Committee, consisting of three independent non-executive directors, advises the
board on remuneration policies and practices generally, and makes specific recommendations to the
board annually on remuneration packages and other terms of employment for senior executives and
directors.
Trading policy in relation to listed securities
This trading policy is provided to all directors and employees so that they are aware of the restrictions
that apply to them in relation to their dealing in securities.
The policy has been developed to ensure that directors and employees comply with insider trading
provisions of the Corporations Act and to avoid the risk that they are perceived to have traded while in
the possession of insider information.
Milton encourages directors and employees to have a personal financial interest in Milton by acquiring
and holding shares on a long term basis.
Short term dealing in and short selling of Milton securities by its directors and employees is not
permitted.
The buying or selling of shares is not permitted by any director or employee of Milton or their immediate
family when that person is in possession of price sensitive information in relation to those shares that is
not available to the market.
This trading restriction is a requirement of the Corporations Act and it applies to dealing in Milton
securities and other listed securities.
Price sensitive information must be treated as confidential and must not be communicated to third
parties who may use the information inappropriately.
The following trading restrictions apply regardless of whether the director or employee or their
immediate family is in possession of price sensitive information.
Directors and employees of Milton or their immediate family may not purchase or sell Milton shares in
the following blackout periods:-
i) from the end of the month until the day after the announcement of the monthly net tangible
asset backing per share (NTA) for that month and
ii) from the end of the half year or full year until the day after the results for the half year or full
year are announced to the market.
It is the responsibility of directors and employees to advise the secretary of any intention to deal in
Milton’s securities and the secretary must be advised when the dealing occurs.
Directors or employees or their immediate family who intend to deal in Milton shares during the closed
periods must receive prior approval from the Chairman. Such requests, which must be made in writing,
will only be approved in exceptional circumstances, which include severe financial hardship.
20
The restrictions on buying or selling Milton shares by directors or employees or their immediate family
in the blackout periods do not apply in the following situations of passive trading in Milton shares:
a. the transfer of securities already held by directors or employees or their immediate family into a
superannuation fund or similar scheme where the above are a beneficiary;
b. the acceptance of a takeover offer;
c. trading under an offer or invitation made to all or most of the company’s security holders, such
as a rights issue, a security purchase plan, a dividend or distribution reinvestment plan and an
equal access buy-back, where the plan that determines the timing and structure of the offer has
been approved by the board. This includes decisions relating to whether or not to take up the
entitlements and the sale of entitlements required to provide for the take up of the balance of
entitlements under a renounceable pro rata issue;
d. accepting an offer to participate in an employee securities plan; and
e. any such similar transaction determined by the directors to be a passive dealing.
Continuous disclosure and shareholder communication
The secretary has been nominated as the person responsible for communications with the ASX. This
role includes responsibility for ensuring compliance with the continuous disclosure requirements in the
ASX listing rules.
The board reviews and approves all announcements to the ASX, except for the monthly net asset
backing announcements which are reviewed by the chief financial officer and the managing director.
Milton has established a website to enhance communication with its shareholders and potential
investors. The website contains historical information, copies of all information disclosed to the ASX
and a corporate governance section that includes details of the various committee charters and
policies. Shareholders, who have advised Milton of their email addresses, are notified by email of all
announcements to the ASX. The Milton communications policy is available on Milton’s website.
Risk management
The managing director and chief financial officer report annually to the Audit Committee on Milton’s risk
management system and provide written confirmation to the board that the integrity of the financial
statements are founded on a sound system of risk management and internal control which is operating
effectively in all material respects in relation to financial reporting.
The board considers an internal audit function is not necessary due to the nature and size of Milton’s
operations. The external auditors report to the Audit Committee on risk management issues identified
during the course of the audit. The risk management policy is available on Milton’s website.
Diversity
The board has established a diversity policy which is available on Milton’s website.
The key element of the diversity policy in that Milton will seek the best person available for the position
which will not be influenced by gender, age, ethnicity or cultural background.
In relation to the appointment of a new director, the board will seek male and female candidates with
the appropriate skills and investment experience to complement the current directors.
At 30 June 2013 the proportion of women employed by Milton was: total Milton employees, 57%; board
of directors, 0%; and senior positions, 14%.
21
Milton Corporation Limited
Consolidated income statement
for the year ended 30 June 2013
Ordinary dividends and distributions
2a
105,839
Note
2013
$'000
Interest
Net gains on trading portfolio
Other revenue
Operating Revenue
2012
$'000
100,907
7,179
258
257
5,637
293
412
112,181
108,601
Share of net profits of joint ventures – equity accounted
Special dividends and distributions
Income from operating activities
19b
2b
5,013
2,744
3,696
772
119,938
113,069
Administration expenses
Acquisition related costs of subsidiaries
Profit before income tax expense
(3,214)
(46)
(3,241)
-
116,678
109,828
Income tax expense thereon
3
(5,461)
(6,411)
Profit attributable to shareholders of Milton
111,217
103,417
Basic and diluted earnings per share
7
91.3
85.0
Cents
Cents
The consolidated income statement is to be read in conjunction with the notes to the consolidated
financial statements.
22
Milton Corporation Limited
Consolidated statement of comprehensive income
for the year ended 30 June 2013
2013
$’000
2012
$'000
Profit
111,217
103,417
Other comprehensive income
Items that will not be reclassified to profit and loss
Revaluation of investments
351,997
(117,649)
Provision for tax (expense) benefit on revaluation of
investments
(105,991)
34,818
Other comprehensive income, net of tax
246,006
(82,831)
Total comprehensive income for the period
attributable to the shareholders of Milton
357,223
20,586
The consolidated statement of comprehensive income is to be read in conjunction with the notes to the
consolidated financial statements.
23
Milton Corporation Limited
Consolidated statement of financial position
as at 30 June 2013
Current assets
Cash
Receivables
Other financial assets
Total current assets
Non-current assets
Receivables
Investments
Joint ventures – equity accounted
Plant and equipment
Deferred tax assets
Total non-current assets
Total assets
Current liabilities
Payables
Current tax liabilities
Provisions
Total current liabilities
Non-current liabilities
Deferred tax liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Issued capital
Capital profits reserve
Asset revaluation reserve
Retained profits
Note
2013
$’000
2012
$'000
8
9a
10
9b
11
19c
12
13
14
114,804
23,170
14,410
152,384
2,925
2,202,530
19,664
52
538
2,225,709
117,618
22,237
14,951
154,806
3,433
1,825,344
18,341
66
786
1,847,970
2,378,093
2,002,776
834
1,112
60
2,006
223,282
412
223,694
225,700
2,938
1,767
163
4,868
116,901
334
117,235
122,103
2,152,393
1,880,673
1,384,438
91,332
512,458
164,165
1,373,857
98,411
259,373
149,032
Total equity attributable to shareholders of Milton
2,152,393
1,880,673
The consolidated statement of financial position is to be read in conjunction with the notes to the
consolidated financial statements.
24
Milton Corporation Limited
Consolidated statement of changes in equity
for the year ended 30 June 2013
Issued
capital
$’000
Capital
profits
reserve
$’000
Asset
revaluation
reserve
$’000
Retained
profits
$’000
Total
equity
$’000
Balance at 1 July 2012
1,373,857
98,411
259,373
149,032
1,880,673
Profit
Other Comprehensive Income:
Total comprehensive income
Net realised losses
Transactions with
shareholders:
Share issues
Dividends paid
Balance at 30 June 2013
-
-
-
-
10,581
-
1,384,438
-
-
-
-
246,006
246,006
111,217
111,217
(7,079)
7,079
-
-
-
-
-
91,332
-
512,458
(96,084)
164,165
111,217
246,006
357,223
-
10,581
(96,084)
2,152,393
Balance at 1 July 2011
1,373,857
99,084
341,531
145,348
1,959,820
Profit
Other Comprehensive Income:
Total comprehensive income
Net realised losses
Transactions with
shareholders:
Dividends paid
Balance at 30 June 2012
-
-
-
-
-
-
-
(82,831)
103,417
-
103,417
(82,831)
(82,831)
103,417
20,586
(673)
673
-
-
-
1,373,857
-
98,411
-
259,373
(99,733)
149,032
(99,733)
1,880,673
The consolidated statement of changes in equity is to be read in conjunction with the notes to the consolidated
financial statements.
25
Milton Corporation Limited
Consolidated statement of cash flows
for the year ended 30 June 2013
Note
Cash flows from operating activities
Dividends and distributions received
Interest received
Distributions received from joint venture entities
Other receipts in the course of operations
Proceeds from sales of trading securities
Payments for trading securities
Other payments in the course of operations
Income taxes paid
Net cash provided by operating activities
18a
Cash flows from investing activities
Proceeds from disposal of investments
Payments for investments
Cash on acquisition of subsidiaries
Payments for acquisition of subsidiaries
Proceeds from sales of plant and equipment
Payments for plant and equipment
Loans repaid by other entities
Loans advanced to other entities
2013
$’000
105,553
5,782
4,700
412
583
(202)
(3,149)
(5,496)
108,183
22,062
(37,479)
67
(46)
-
(5)
790
(284)
2012
$’000
99,833
7,695
4,237
257
4,540
(4,077)
(2,527)
(5,480)
104,478
34,777
(48,910)
-
-
25
(12)
155
(641)
Net cash provided by (used in) investing activities
(14,895)
(14,606)
Cash flows from financing activities
Payments for issue of shares
Ordinary dividends paid
Special dividends paid
Net cash used in financing activities
Net (decrease) increase in cash assets held
Cash assets at the beginning of the year
Cash assets at the end of the year
8
(18)
(96,084)
-
(96,102)
-
(93,652)
(6,081)
(99,733)
(2,814)
(9,861)
117,618
114,804
127,479
117,618
The consolidated statement of cash flows is to be read in conjunction with the notes to the consolidated
financial statements.
26
Milton Corporation Limited
Notes to the consolidated financial statements for the year ended
30 June 2013
1.
Summary of significant accounting policies
The principal accounting policies adopted in the preparation of these financial statements are set out
below. These policies have been consistently applied to all the years presented, unless otherwise
stated. The financial statements include the consolidated entity (“Milton”) consisting of Milton
Corporation Limited and its subsidiaries.
a. Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian
Accounting Standards, Australian accounting interpretations, other authoritative pronouncements of
the Australian Accounting Standards Board and the Corporations Act 2001.
These financial statements have been prepared on an accruals basis and are based on the historical
cost basis except as modified by the revaluation of certain financial assets and liabilities measured at
fair value.
Unless otherwise stated under the option available in ASIC Class Order 98/100, the financial
statements are presented in Australian dollars and all values are rounded to the nearest thousand
dollars ($'000).
i) New and amended standards adopted:
Milton adopted the amendments made to AASB 101 Presentation of Financial Statements effective
1 July 2012 which now require the statement of comprehensive income to show the items of
comprehensive income grouped into those that will not be reclassified subsequently to profit or loss
and those that will be reclassified if certain conditions are met. In the current and comparative
financial years, Milton only has items recognised in comprehensive income that will not be
reclassified into profit and loss in future periods.
ii) Early adoption of standards:
Milton has elected to early adopt AASB 10 Consolidated Financial Statements, AASB 11 Joint
Arrangements, AASB 12 Disclosure of Interest in Other Entities, AASB 128 Investments in
Associates and Joint Ventures and AASB 127 Separate Financial Statements. Accordingly,
disclosures have been made in relation to Milton’s judgement in determining the use of equity method
for all its joint ventures (refer note 1(k)) and the nature and risks associated with Milton’s investments
in joint ventures (refer note 19). There have been no changes to the financial statements as a result
of the early adoption. No other new accounting standards and interpretations that are available for
early adoption at 30 June 2013, but not yet adopted, will result in any material change in relation to
the financial statements of Milton.
b. Basis of consolidation
The consolidated financial statements include the financial statements of Milton, being the parent
entity and its subsidiaries. The balances and effects of transactions between subsidiaries included in
the consolidated financial statements have been eliminated in full.
i) Subsidiaries
The financial statements of subsidiaries are prepared for the same reporting period as the parent
entity, using consistent accounting policies.
Where entities have come under the control of the parent entity during the year, their operating
results have been included in the group from the date control was obtained. Entities cease to be
consolidated from the date on which control is transferred out of the group and the consolidated
financial statements include the result for the part of the reporting period during which the parent
entity had control.
27
1. Summary of significant accounting policies (continued)
ii) Joint arrangements
Under AASB 11 Joint Arrangements, investments in joint arrangements are classified as either joint
operations or joint ventures based on rights and obligations arising from the joint arrangement rather
than the legal structure of the joint arrangement. Milton has assessed the nature of its joint
arrangements and determined that all current interests are joint ventures and thus accounted for
using the equity method.
iii) Change in accounting policy
AASB 10 Consolidated Financial Statements which was issued in August 2011 replaces the guidance
on control and consolidation under AASB 127 Consolidated and Separate Financial Statements and
under Interpretation 112 Consolidations - Special Purpose Entities. Milton has reviewed its
investments in other entities to assess whether the conclusion to consolidate is different under
AASB 10 than under AASB 127. No differences were found and therefore no adjustments to any of
the carrying amounts in the financial statements are required as a result of the adoption of AASB 10.
c. Income tax
The income tax expense is the tax payable on the current year’s taxable income based on the current
income tax rate applicable for the year adjusted by changes in deferred tax assets and liabilities
attributable to temporary differences between the tax bases of assets and liabilities and their carrying
amounts in the financial statements, and to unused tax losses.
Deferred tax is recognised using the balance sheet method.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only
if it is probable that future taxable amounts will be available to utilise those temporary differences and
losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying
amount and tax bases of investments in subsidiaries where the parent entity is able to control the
timing of the reversal of the temporary differences and it is probable that the differences will not
reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current
tax assets and liabilities.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected
to apply when the assets are recovered or liabilities are settled, based on those tax rates which are
enacted or substantively enacted. The relevant tax rates are applied to the cumulative amounts of
deductible and taxable temporary differences to measure the deferred tax asset or liability. An
exception is made for certain temporary differences arising from the initial recognition of an asset or a
liability. No deferred tax asset or liability is recognised in relation to these temporary differences if
they arose in a transaction, other than a business combination, that at the time of the transaction did
not affect either accounting profit or taxable profit or loss.
Deferred tax balances attributable to revaluation amounts are recognised directly in equity through
the asset revaluation reserve.
Milton Corporation Limited (the parent entity) and its wholly-owned subsidiaries have formed an
income tax consolidated group. Each entity in the group recognises its own current and deferred tax,
except for any deferred tax assets arising from unused tax losses from subsidiaries, which are
immediately assumed by the parent entity. The current tax liability of each group entity is
subsequently assumed by the parent entity. There is no tax funding agreement between Milton
Corporation Limited and its subsidiaries.
d. Cash
Cash includes cash at bank, deposits at call and term deposits, and is recognised at fair value.
Interest from deposits and bank accounts is brought to account on an accruals basis as it is earned.
e. Trading securities
Trading securities are recognised initially at cost and subsequently measured at fair value.
Changes in fair value are taken directly through the income statement.
Dividends are brought to account on the date that the shares are traded "ex-dividend".
28
1. Summary of significant accounting policies (continued)
f. Other liquid securities
Other liquid securities include listed securities such as reset preference shares which are classified
as equity instruments and may be realised within 12 months.
Other liquid securities are recognised initially at cost and Milton has elected to present subsequent
changes in fair value in other comprehensive income through the asset revaluation reserve after
deducting a provision for the potential deferred capital gains tax liability.
On disposal, the cumulative gain or loss, net of tax thereon, is transferred from the asset revaluation
reserve to the capital profits reserve.
Distribution income from these securities is brought to account on the day that these securities trade
“ex-dividend”.
g. Investments
Subsidiaries
Investments in subsidiaries are carried at net asset value which approximates fair value of the
controlled entities.
Income from dividends is brought to account when they are declared.
Other companies
Investments are recognised initially at cost and Milton has elected to present subsequent changes in
fair value of equity instruments in other comprehensive income through the asset revaluation reserve
after deducting a provision for the potential deferred capital gains tax liability as these investments
are long term holdings of equity instruments.
Quoted investments are valued continuously at fair value, which is the price quoted on the Australian
Securities Exchange.
When an investment is disposed, the cumulative gain or loss, net of tax thereon, is transferred from
the asset revaluation reserve to the capital profits reserve.
Dividends and distributions are brought to account on the date that the investment trades "ex-
dividend".
De-merger dividends arising from company de-consolidations are treated as a return of capital and
not as a dividend.
h. Employee benefits
The provision for employee entitlements relates to amounts expected to be paid to employees for
long service leave and annual leave (including on-costs) and is based on legal and contractual
entitlements and assessments having regard to experience in relation to staff departures and leave
utilisation. Employees are not paid on termination for untaken personal/carer’s leave.
Under the Employee Share Plan, shares are acquired for employees as part of their remuneration
and the cost of the shares is recorded in employee benefit expenses (refer note 17a).
Under the Senior Staff Share Plan, shares are acquired for eligible employees as part of their
remuneration and held on their behalf by the trustee of the Plan. The purchase of the Plan Shares is
financed by a loan from Milton (refer note 17b).
i. Operating segments
The consolidated entity operates in Australia only and the principal activity is investment.
j. Business Combinations
The acquisition method of accounting has been used to account for all business combinations,
regardless of equity instruments or other assets acquired. The business combinations have been
accounted from the date Milton attained control of the subsidiaries. The considerations transferred for
the acquisitions comprise of the fair values of the identifiable assets transferred and the liabilities
assumed.
Costs related to the acquisitions, other than those associated with the issue of equity securities, are
expensed to the consolidated income statement as incurred.
29
1. Summary of significant accounting policies (continued)
k. Critical accounting estimates and judgments
Judgements, estimates and assumptions are required to prepare financial statements.
(i) Offset deferred tax assets from realised capital losses against deferred tax liabilities from
unrealised capital gains:
Deferred tax liabilities have been recognised for capital gains tax on the unrealised gain in the
investment portfolio at current tax rates.
As Milton does not intend to dispose of the investment portfolio this tax may not be payable at the
amount disclosed in note 13. Any tax liability that may arise on disposal of investments is subject to
tax legislation relating to the treatment of capital gains and the applicable tax rate at the time of
disposal.
Deferred tax assets have been recognised relating to carried forward capital losses, based on current
tax rates. Utilisation of the tax losses requires the realisation of capital gains in subsequent years and
the ability to satisfy certain tests at the time the losses are recouped. The deferred tax assets related
to carried forward capital losses have been offset against the related deferred tax liabilities as
disclosed in note 13.
(ii) Classification of joint arrangements as joint ventures:
Milton has non controlling interests in three property development joint venture partnerships through
separate joint venture entities.
Each joint venture partnership agreement provides that partners have rights to the net assets of the
partnership.
Accordingly, the directors have determined that each joint venture partnership is to be classified as a
joint venture and accounted for using the equity method.
Apart from (i) and (ii) above, there are no key assumptions or sources of estimation uncertainty that
have a risk of causing a material adjustment to the carrying amounts of assets and liabilities within
the next financial year.
30
2. Revenue
a. Ordinary dividends and distributions from
Investments held in portfolio at 30 June
Investments sold during the year
b. Special dividends and distributions from
Investments held in portfolio at 30 June
Investments sold during the year
3.
Income tax expense
Prima facie income tax expense calculated at 30% on the profit
before income tax expense
Increase (decrease) in income tax expense due to:
Tax offset for franked dividends
Non taxable distributions
Under provision in prior year
Other differences
Income tax expense on profit
4. Auditor’s remuneration
Auditors of the company
Audit and review services
Due diligence
Related practice of the auditor
Liquidation of non-operating subsidiary
5. Ordinary and special fully franked dividends
a. Recognised in the current year
An ordinary final dividend in respect of the 2012 year of 40 cents
per share paid on 4 September 2012 (2012: an ordinary final
dividend in respect of the 2011 year of 39 cents per share paid
on 20 September 2011)
(2012: a special dividend of 5 cents per share paid on 20
September 2011)
An ordinary interim dividend of 39 cents per share paid on
6 March 2013
(2012: 38 cents per share paid on 29 February 2012)
b.
Not recognised in the current year
Since the end of the financial year, the directors declared an
ordinary final dividend in respect of the 2013 year of 43 cents
per share and a special dividend of 2.5 cents per share payable
on 4 September 2013. (2012: ordinary final dividend of 40 cents
per share and special dividend nil paid on 4 September 2012)
31
2013
$’000
2012
$’000
105,620
219
105,839
99,227
1,680
100,907
2,744
-
2,744
326
446
772
35,003
32,948
(29,148)
(412)
10
8
5,461
104
10
114
-
114
(26,502)
(360)
320
5
6,411
111
-
111
7
118
48,650
47,434
-
6,081
47,434
96,084
46,218
99,733
55,577
48,650
5. Ordinary and special fully franked dividends (continued)
c. Dividend franking account
The amount of franking credits available to shareholders for the
subsequent financial year, adjusted for franking credits that will
arise from the payment of the current tax liability
Subsequent to year end, the franking account will be reduced by
the proposed ordinary final and special dividends to be paid on
4 September 2013 (2012: ordinary final dividend)
2013
$’000
2012
$’000
111,550
105,182
(23,819)
87,731
(20,850)
84,332
The franking account balance would allow Milton to frank additional dividend payments up to an
amount of $204,705,527 (2012:$196,773,586) which represents 168 cents per share
(2012: 162 cents per share).
6.
Listed Investment Company capital gain account
Balance of the Listed Investment Company (LIC) capital gain
account available to shareholders for the subsequent financial
year
1,190
1,179
Distributed LIC capital gains may entitle certain shareholders to a special deduction in their income
tax return. LIC capital gains available for distribution are dependent upon the disposal of investment
portfolio holdings which qualify for LIC capital gains and the receipt of LIC capital gain distributions.
7.
Earnings per share
Basic earnings per share
Profit attributable to shareholders of the parent entity
Weighted average number of ordinary shares used in the
calculation of basic earnings per share
Diluted earnings per share figures are the same because there
are no dilutive potential ordinary shares.
8. Cash
Cash at bank
Deposits at call
Term deposits
cents
cents
91.3
85.0
$’000
111,217
$’000
103,417
No.
No.
121,804,239
121,625,655
$’000
$’000
2,782
16,224
95,798
114,804
1,510
10,511
105,597
117,618
The weighted average interest rate for cash and deposits at call as at 30 June 2013 is 3.3% p.a.
(2012: 3.4% p.a.). Term deposits have an average maturity date of August 2013 (2012: August 2012)
and an average interest rate of 4.2% (2012: 5.4% pa).
32
9.
a.
Receivables
Receivables – current
Income receivable
Sundry debtors
b.
Receivables – non-current
2013
$’000
23,166
4
23,170
2012
$’000
20,481
1,756
22,237
Senior staff share plan loans (refer note 17b)
2,925
3,433
c.
Terms and conditions
Sundry debtors are due within 30 days and no interest is charged.
10. Other financial assets
Other liquid securities - at fair value
Trading securities - at fair value
Prepaid expenses
11.
Investments – non-current
Quoted investments - at fair value
Unquoted investments - at fair value
a.
Included in quoted investments are:
Shares in other corporations
Stapled securities in other corporations
Units in trusts
b.
Included in unquoted investments are:
Securities in other corporations
Units in trusts
c.
Investments disposed of during the year
Fair value at disposal date
Equity investments
Loss on disposal after tax
Equity investments
14,205
-
205
14,410
14,535
184
232
14,951
2,202,504
1,825,171
26
173
2,202,530
1,825,344
2,136,433
1,764,871
45,164
20,907
36,317
23,983
2,202,504
1,825,171
-
26
26
6
167
173
20,306
36,181
(7,179)
(4,960)
The disposals occurred in the normal course of Milton’s operations as a listed investment company or
as a result of takeovers or mergers.
33
12.
Deferred tax assets
The balance comprises temporary differences attributable to :
2013
$’000
2012
$’000
Revenue tax losses carried forward
Provisions
Retirement benefit obligations
Share issue expenses
Other
Total deferred tax assets
Movements:
Balance at 1 July
12
247
57
6
216
538
786
(charged) to the income statement
(253)
(charged) to equity
Balance at 30 June
To be recovered within 12 months
To be recovered after more than 12 months
5
538
128
410
538
13.
Deferred tax liabilities
The balance comprises temporary differences attributable to:
Amounts recognised directly in equity:
22
255
57
140
312
786
1,067
(281)
-
786
265
521
786
Revaluation of investments
Realised capital losses
Amounts recognised in profit:
Realised capital gains
Income receivable which is not assessable for tax until
receipt
Movements:
Balance at 1 July
Charged to income statement
Charged (credited) to other comprehensive income
(Credited) to equity
Balance at 30 June
To be settled within 12 months
To be settled beyond 12 months
223,521
(17,348)
115,316
(15,510)
832
832
16,277
223,282
116,901
459
105,991
(69)
223,282
-
16,263
116,901
151,792
49
(34,818)
(122)
116,901
-
223,282
116,901
34
14.
Issued capital
a. Movement in share capital
Balance at 1 July 2012
2013
$’000
2012
$’000
1,373,857
1,373,857
521,464 shares issued as consideration for acquisitions
10,581
-
Balance at 1 July 2013 : 122,147,119 shares
(30 June 2012: 121,625,655 shares)
1,384,438
1,373,857
b.
Ordinary shares
All capital consists of fully paid ordinary shares which are listed on the ASX and carry one vote per
share and the right to receive dividends.
15.
Nature and purpose of reserves
Changes in fair value of investments are presented in other comprehensive income through the asset
revaluation reserve as referred to in note 1g.
Upon disposal of investments, the net gain or loss is transferred from the asset revaluation reserve
to the capital profits reserve as referred to in note 1g.
16.
Management of financial risk
The risks associated with the financial instruments, such as investments and cash, include market
risk, credit risk and liquidity risk.
The Audit Committee has approved policies and procedures to manage these risks. The
effectiveness of these policies and procedures is continually reviewed by management and
annually by the Audit Committee.
a.
Financial instruments’ terms, conditions and accounting policies
Milton’s significant accounting policies are included in note 1, and the terms and conditions of each
class of financial asset, financial liability and equity instrument, both recognised and unrecognised at
the reporting date, are included under the appropriate note for that instrument.
b.
Net fair values
The carrying amounts of financial instruments in the consolidated statement of financial position
approximate their net fair value.
c.
Credit risk exposures
Milton’s principal credit risk exposures arise from the investment in liquid assets, such as cash, bank
term deposits and income receivable.
The risk that a financial loss will occur because a counterparty to a financial instrument fails to
discharge an obligation is known as credit risk. The credit risk on Milton’s financial assets, excluding
investments, is the carrying amount of those assets.
Individual bank limits have been approved by the board for the investment of cash.
Income receivable comprises accrued interest and dividends and distributions which were brought to
account on the date the shares or units traded ex-dividend.
There are no financial instruments overdue.
All financial assets and their recoverability are continuously monitored by management and
reviewed by the board on a quarterly basis.
35
16.
Management of financial risk (continued)
d. Market risk
Market risk is the risk that changes in market prices will affect the fair value of the financial
instrument.
Milton is exposed to market risk through the movement of the security prices of the companies and
trusts in which it is invested.
The market value of individual companies fluctuates daily and the fair value of the portfolio changes
continuously, with this change in the fair value recognised through the asset revaluation reserve.
Investments represent 93% (2012: 91%) of total assets. A 5% fall in movement in the market value
of investments in each of the companies and trusts within the portfolio would result in a 4.6%
(2012: 4.6%) movement in the net assets before provision for tax on unrealised capital gains at
30 June 2013 (2012: 30 June 2012). The net asset backing before provision for tax on unrealised
capital gains would move by 90 cents per share at 30 June 2013 (2012: 75 cents at 30 June 2012).
Milton’s management regularly monitor the performance of the companies within its portfolio and
make portfolio recommendations which are considered by the Investment Committee. The Milton
board reviews the portfolio on a quarterly basis.
Milton is not exposed to foreign currency risk as all its investments are quoted in Australian dollars.
The fair value of Milton’s other financial instruments is unlikely to be materially affected by a
movement in interest rates as they generally have short dated maturities and variable interest rates.
e.
Liquidity risk
Liquidity risk is the risk that Milton is unable to meet its financial obligations as they fall due.
Milton manages liquidity risk by monitoring forecast and actual cashflows.
f.
Capital risk management
The parent entity invests its equity in a diversified portfolio of assets that generates a growing
income stream for distribution to shareholders in the form of fully franked dividends.
The capital base is managed to ensure there are funds available for investment as opportunities
arise. Capital may be increased through the issue of shares under the Share Purchase Plan. Other
means of increasing capital could include rights issues and acquisitions of unlisted investment
companies.
g.
Fair value measurement
Financial instruments carried at fair value are comprised of investments and other financial assets.
The fair value of these financial instruments is the quoted prices (unadjusted) in active markets for
identical assets. The Australian Securities Exchange is the active market for all financial
instruments.
36
17.
a.
Employee entitlements
Employee Share Plan
The Employee Share Plan ("ESP") is available to all eligible employees to acquire ordinary shares in
Milton in lieu of a cash bonus of up to $1,000 per year as part of the employee’s remuneration. The
transaction and administration costs of acquiring the shares and administering the plan are paid by
Milton.
During the year, 252 shares (2012: 260 shares) were acquired by Milton on behalf of eligible
employees under the ESP at a cost of $3,999 (2012: $3,955) with a total market value at 30 June
2013 of $3,955.
Any shares acquired cannot be disposed of or transferred until the earlier of 3 years from the date of
issue or acquisition or on the date that the employee's employment ceases with Milton.
b.
Senior Staff Share Plan
The Senior Staff Share Plan ("SSSP") was approved by shareholders at Milton's Annual General
Meeting on 9 October 2001. Eligible employees are given the opportunity to apply for Plan Shares in
Milton which are subscribed for or acquired and held on their behalf by the trustee of the plan. The
purchase of these Plan Shares is financed by an interest-free limited recourse loan from Milton with
recourse only to Plan Shares. The loan will be repaid partially from any dividends received. Milton
administers the SSSP and meets the transactional and administration costs.
During the year, 18,000 shares (2012: 42,500 shares) were acquired by the trustee of the plan on
behalf of eligible employees under the SSSP at a cost of $283,583 (2012: $641,464). The loans to
eligible employees are as disclosed in note 9b. The shares acquired by the trustee during the year
had a market value of $331,200 at $18.40 per share as at 30 June 2013.
Any shares acquired are held in the name of the trustee and classified as Restricted Shares which
cannot become Unrestricted Shares until the earlier of 3 years from the date of issue to the trustee or
acquisition by the trustee or on the date that the employee’s employment ceases with Milton. The
trustee may transfer Unrestricted Shares to the participant provided that any outstanding loan has
been repaid in full.
During the year, 47,500 shares (2012: Nil) were disposed by the trustee and proceeds of $646,086
were applied to fully repay loans of the retiring executive.
18.
Note to the cash flow statements
a.
Reconciliation of net profit to net cash provided by
operating activities
Profit
Share of net profits of joint ventures – equity accounted
Distributions received from joint venture entities
Depreciation of non-current assets
Acquisition related costs of subsidiaries
Increase in receivables
Decrease in payables and provisions
Increase in income taxes payable
2013
$’000
2012
$’000
111,217
(5,013)
4,700
19
46
(2,798)
46
(34)
103,417
(3,696)
4,237
35
-
(1,126)
679
932
Net cash provided by operating activities
108,183
104,478
b.
Non-cash financing and investing activities
As described in note 21.b Milton acquired an unlisted investment company through the issue of
521,464 new Milton shares with a fair value of $9,913,031. (2012: no non-cash financing and
investing activities)
37
19.
a.
Investment in joint venture entities
Details of joint venture entities
Companies in the consolidated entity have entered into joint ventures to develop real property.
These joint ventures which are held by subsidiaries have been accounted for using the equity
accounting principles.
b.
Contribution from joint venture entities
Milton has interests in the following joint venture entities:
33.33% interest in the Ellenbrook Syndicate Joint Venture
contribution to operating profit before tax
23.33% interest in the Mews Joint Venture
contribution to operating profit before tax
50% interest in the LWP Huntlee Syndicate No 2 Joint
Venture
Share of net profits of joint ventures
c.
Consolidated interest in the assets and liabilities of the
joint ventures
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Provision for diminution in value
Net assets
2013
$’000
4,610
415
(12)
5,013
19,060
13,106
(1,866)
(10,093)
20,207
(543)
19,664
2012
$’000
3,451
245
-
3,696
16,790
13,538
(1,741)
(9,703)
18,884
(543)
18,341
d.
Contingent liabilities and commitments
Each venturer is liable for its share of the debts of the joint ventures. The finance facilities have
recourse only to the assets of the joint ventures. The LWP Huntlee Syndicate No 2 Joint Venture
was formed in June 2010 and Milton is committed to providing further capital of $1.188 million over
the next year (2012: $1.009 million). Apart from this commitment there are no further financial
commitments.
20.
Parent entity disclosures
In accordance with the Corporations Amendment (Corporate Reporting Reform) Act 2010 and the
Corporations Act 2001 the following summarised parent entity information is set out below.
As at, and throughout, the financial year ended 30 June 2013 the parent entity is Milton Corporation
Limited.
Profit of the parent entity
Profit for the year
Total comprehensive income for the year
$’000
107,715
353,720
$’000
100,822
17,991
38
20.
Parent entity disclosures (continued)
Financial position of the parent entity as at 30 June
Current assets
Total assets
Current liabilities
Total liabilities
Net assets
Total equity of the parent entity comprising of
Issued capital
Capital profits reserves
Asset revaluation reserve
Retained profits
2013
$’000
2012
$’000
152,301
2,463,731
85,020
311,338
2,152,393
154,732
2,075,651
75,778
194,978
1,880,673
1,384,438
1,373,857
99,911
554,940
113,104
106,989
298,354
101,473
Total equity attributable to shareholders of the parent
entity
2,152,393
1,880,673
21.
Particulars in relation to subsidiaries
a. Milton Corporation Limited’s subsidiaries
The following subsidiaries have been included in the
consolidated accounts:
85 Spring Street Properties Pty Ltd
Chatham Investment Co. Pty Limited
Incorporated Nominees Pty Limited
Milhunt Pty Limited
The parent entity and all subsidiaries are incorporated in
Australia.
Interest held %
100
100
100
100
100
100
100
100
b. Acquisition of subsidiaries
During the year ended 30 June 2013, Milton acquired 100% of the shares of an unlisted investments
company for a consideration of 521,464 new Milton shares with a fair value of $9,913,031.
c.
Disposal of subsidiaries
The unlisted investment company acquired during the year was placed into voluntary liquidation in
June 2013. (2012: Choiseul Investments Limited was placed into voluntary liquidation).
22.
a.
Related parties
Directors and Key Management Personnel compensation
Short-term benefits
Other long-term benefits
Post-employment benefits
Share-based payments
$’000
1,140
23
99
163
1,425
$’000
939
17
175
184
1,315
Information regarding individual directors’ and executives’ compensation and equity instruments
disclosures, as permitted by Corporations Regulations 2M.3.03, are provided in the Remuneration
Report section of the Directors’ Report on pages 14 to 17.
39
22. Related parties (continued)
b. Shareholdings of non-executive directors and their related parties – number of shares held
R.D. Millner
J.F. Church
G.L. Crampton
K.J. Eley
I.A. Pollard
Balance
1 July
Acquisition
Disposals
9,685,543
9,581,822
5,908,783
5,901,400
27,307
27,307
5,932
-
27,437
27,437
-
103,721
4,301
7,383
-
-
14,068
-
2,000
-
-
-
(35,715)
-
-
-
-
-
-
-
Balance
30 June
9,685,543
9,685,543
5,877.369
5,908,783
27,307
27,307
20,000
5,932
29,437
27,437
2013
2012
2013
2012
2013
2012
2013
2012
2013
2012
c. Executives’ and their related parties shareholdings – number of shares held
F.G. Gooch
Managing director
D.N. Seneviratne
CFO, secretary
(appointed 21/12/12)
A.R. Davison
CFO, secretary
(retired 15/04/13)
Balance
1 July
Received as
Remuneration
Other
Acquisitions
2013
2012
2013
2012
2013
2012
183,737
162,737
3,625
-
15,000
20,000
63
-
48,012
-
43,012
5,000
-
1,000
-
-
-
-
Balance
30 June
198,737
183,737
3,688
-
-
48,012
d. Loans to key management personnel
Details regarding loans outstanding at the reporting date to specified directors and specified executives,
where the individual’s aggregate loan balance exceeded $100,000 at any time in the reporting period, are
as follows
Balance
1 July
Net
change
Balance
30 June
$
2013
2012
2013
2012
1,683,932
1,460,406
665,824
620,126
$
156,388
223,526
(665,824)
45,698
$
1,840,320
1,683,932
-
665,824
Highest
balance in
the period
$
1,920,264
1,762,271
Notional
Interest
$
132,885
131,819
665,824
25,583
695,593
52,369
F.G. Gooch
Managing director
A.R. Davison
CFO, secretary
(retired 15/04/13)
(1)
(1)
(1)The loans to Mr. Davison were repaid in full upon his retirement.
Terms and conditions of the loans are referred to in note 17b.
40
22. Related parties (continued)
e. Other related party transactions
All non-executive directors have entered into the Deed of Indemnity, Insurance and Access that was
approved at the Annual General Meeting held on 10 October 2000. Milton has a Remuneration and
Retirement Benefits Deed with each of the non-executive directors except Messrs G.L Crampton and
K.J. Eley. During the 30 June 2004 year, Milton and the directors varied the Remuneration and
Retirement Benefits Deed, whereby the maximum retirement benefit payable to a non-executive
director on retirement will be the provision for the director as at 30 June 2003. Apart from the details
disclosed in this note no director has entered into a material contract with the parent entity or Milton
since the end of the previous financial year and there were no material contracts involving directors’
interests subsisting at the end of the year.
Loans to and from subsidiaries
Loans have been made between the parent entity (and) wholly owned subsidiaries for capital
transactions. The loans between the parent and its subsidiaries have no fixed date of repayment and
are non-interest bearing.
Balance at beginning of the year
Loans advanced from subsidiaries
Loan advanced to subsidiaries
Balance at end of the year
2013
$
2012
$
72,149,885
13,387,148
492,855,719
4,237,499
(1,015,450)
(424,943,333)
84,521,583
72,149,885
Other arrangement with non executive director
Mr J.F. Church rented office space from Milton at commercial rates from 1 July 2012 to 30 June 2013
and rental income received by Milton during the financial year was $13,726 (2012: $13,191).
23. Contingencies
At the reporting date the directors are not aware of any material contingent liabilities.
24.
Events subsequent to reporting date
Since the end of the financial year, the directors declared an ordinary fully franked final dividend of
43 cents per share and a special dividend of 2.5 cents per share payable on 4 September 2013.
This financial report was authorised for issue in accordance with a resolution of directors on 8 August
2013.
41
25. Holdings at Fair Value through Other Comprehensive Income at 30 June 2013
The following holdings are valued at fair value through Other Comprehensive Income.
2013
$’000
Investments in equity instruments
Adelaide Brighton Limited
AGL Energy Limited
ALS Limited (formerly Campbell Brothers)
Alumina Limited
Amalgamated Holdings Limited
Amcor Limited
AMP Limited
A P Eagers Limited
APA Group
APN News & Media Limited
ARB Corporation Limited
Argo Investments Limited
Arrium Limited
ASX Limited
Austbrokers Holdings Limited
Australand Property Group
Australia & New Zealand Banking Group Limited
- ordinary shares
- convertible preference shares
- CPS 1
Australian Foundation Investment Company Limited
Automotive Holdings Group Limited
Bank of Queensland Limited
Bendigo & Adelaide Bank Limited
BHP Billiton Limited
BKI Investment Company Limited
Blackmores Limited
Boral Limited
Bradken Limited
Brambles Limited
Brickworks Limited
BWP Trust
Cabcharge Australia Limited
Caltex Australia Limited
Cardno Limited
Carlton Investments Limited
CFS Retail Property Trust
Charter Hall Retail REIT
Coca-Cola Amatil Limited
Cochlear Limited
Commonwealth Bank of Australia
- ordinary shares
- PERLS V
Commonwealth Property Office Fund
Consolidated Media Holdings Limited
Crown Limited
CSL Limited
CSR Limited
David Jones Limited
Diversified United Investment Limited
Dulux Group Limited
Equity Trustees Limited
Finbar Group
Fletcher Building Limited
Fairfax Media Limited
FKP Property Group
Fleetwood Corporation Limited
42
6,925
33,373
103,855
485
6,125
11,897
9,015
23,741
6,492
327
8,490
5,227
3,116
14,939
11,170
2,898
82,597
1,975
199
7,095
4,270
57,053
57,497
102,213
1,629
10,184
6,852
3,475
10,909
41,079
3,068
-
-
4,646
7,486
15,942
-
17,377
1,962
209,482
101
1,897
-
3,237
36,151
-
908
811
312
3,509
1,481
5,735
1,600
1,223
821
2012
$’000
5,926
34,042
117,623
886
4,777
8,227
7,781
18,525
5,408
865
6,777
4,167
3,456
11,755
6,834
2,057
62,353
1,935
199
5,426
2,567
43,363
42,309
101,143
1,325
9,769
4,801
3,656
7,195
32,568
2,543
674
645
5,678
5,606
17,660
2,030
18,293
2,094
159,941
102
1,750
901
2,269
23,142
292
922
641
-
2,605
-
3,695
1,794
1,380
2,078
25. Holdings at Fair Value through Other Comprehensive Income at 30 June 2013 (continued)
Goodman Group
Goldman Sachs JB Were Collateral Mezzanine Fund
Goldman Sachs JB Were Private Equity Fund
Graincorp Limited
Gresham Private Equity Co-Investment Fund
GWA International Limited
Hills Holdings Limited
Insurance Australia Group Limited
- ordinary shares
- convertible preference shares
IAG Finance(NZ) Limited Perpetual Reset Exchangeable Notes
Incitec Pivot Limited
InvoCare Limited
IOOF Holdings Limited
Leighton Holdings Limited
Lend Lease Corporation Limited
Lindsay Australia Limited
Macquarie Group Limited
McMillan Shakespeare Limited
Metcash Limited
Mirvac Group
MyState Limited
National Australia Bank Limited
New Hope Corporation Limited
Noni B Limited
Orica Limited
Origin Energy Limited
Perpetual Limited
Plantation Land Limited
Premier Investments Limited
QBE Insurance Group Limited
Qube Logistics Holdings Limited
Ramsay Health Care Limited
Reece Australia Limited
Rio Tinto Limited
Santos Limited
Schaffer Corporation Limited
Sedgman Limited
Select Harvests Limited
Seven Group Holdings Limited – TELYS4 preference shares
Seven West Media Limited
Sims Metal Management Limited
Sonic Healthcare Limited
Stockland Group
Suncorp Group Limited
- ordinary shares
- convertible preference shares
Sydney Airport
Tatts Group Limited
Telstra Corporation Limited
Ten Network Holdings Limited
Toll Holdings Limited
TPG Telecom Limited
Transfield Services Limited
Transurban Group
43
2013
$’000
902
5
-
4,235
21
5,460
-
20,577
306
1,234
4,375
19,295
3,298
11,709
3,743
280
20,689
1,618
16,395
-
1,887
130,200
4,606
520
3,903
4,866
29,174
-
2,573
41,398
2,278
3,758
3,167
23,822
17,630
298
1,071
529
593
3,076
6,550
9,012
7,485
33,768
-
1,461
3,528
63,347
-
6,015
13,135
1,170
14,582
2012
$’000
678
97
9
2,946
60
4,778
1,115
12,728
294
1,192
4,360
13,666
974
12,330
3,227
272
12,847
-
16,124
417
1,357
102,368
5,173
577
4,370
4,723
18,735
6
1,791
36,203
1,965
2,373
2,356
25,475
14,985
248
2,115
210
546
2,825
7,621
6,637
6,625
22,918
3,730
1,254
1,724
43,421
636
4,373
6,513
2,757
12,274
25. Holdings at Fair Value through Other Comprehensive Income at 30 June 2012 (continued)
Treasury Wine Estates Limited
The Trust Company Limited
UGL Limited
Washington H Soul Pattinson & Company Limited
Wesfarmers Limited
- ordinary shares
- partially protected shares
Westfield Group
Westfield Retail Trust
Westpac Banking Corporation
Wide Bay Australia Limited
Woodside Petroleum Limited
Woolworths Limited
Worley Parsons Limited
Other liquid securities
AMP – notes
APT Pipelines Limited
Bank of Queensland – convertible preference shares
Bank of Queensland - perpetual equity preference 07
Colonial Group – subordinated notes
Commonwealth Bank of Australia
- Perls III
- Perls IV
Goodman Funds Management – perpetual listed unsecured
securities
Macquarie CPS Trust – convertible preference shares
Suncorp convertible preference shares
Westpac Banking Corporation - preference shares (stapled
preferred securities)
Woolworths notes II
2013
$’000
5,955
16,143
10,042
120,123
103,235
10,516
7,688
2,433
301,729
2,276
28,749
86,322
4,923
2,202,530
2,678
1,052
5,257
-
1,018
926
-
1,064
1,000
-
1,000
210
14,205
2012
$’000
4,451
13,202
16,781
125,418
74,806
10,752
4,540
1,684
220,126
2,519
24,511
69,318
5,788
1,825,344
2,723
-
-
4,525
995
893
1,200
985
1,025
982
1,000
207
14,535
44
DIRECTORS’ DECLARATION
1. In the opinion of the directors of Milton Corporation Limited:
(a) the consolidated financial statements and notes that are set out on pages 22 to 44 and the
Remuneration report, that is set out on pages 14 to 17 in the Directors’ report are in accordance with
the Corporations Act 2001, including:
(i) giving a true view of the consolidated entity’s financial position as at 30 June 2013 and of its
performance for the financial year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations
2001; and
(b) there are reasonable grounds to believe that Milton Corporation Limited will be able to pay its debts as
and when they become due and payable.
2. The directors have been given the declarations required by Section 295A of the Corporations Act 2001
from the chief executive officer and chief financial officer for the financial year ended 30 June 2013.
Signed in accordance with a resolution of the directors.
R. D. MILLNER
Chairman
Sydney, 8 August 2013
45
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF MILTON CORPORATION LIMITED
Level 15, 135 King Street
Sydney NSW 2000
T +61 (0)2 8236 7700
F +61 (0)2 9233 4636
www.moorestephens.com.au
We have audited the accompanying financial report of Milton Corporation Limited and its Controlled Entities (the
consolidated entity), which comprises the consolidated statement of financial position as at 30 June 2013, the
consolidated income statement, the consolidated statement of comprehensive income, the consolidated
statement of changes in equity and the consolidated statement of cash flows for the year then ended, notes
comprising a summary of significant accounting policies and other explanatory information and the directors’
declaration of the consolidated entity comprising Milton Corporation Limited and the entities it controlled at the
year’s end or from time to time during the financial year.
Directors’ Responsibility for the Financial Report
The directors of Milton Corporation Limited are responsible for the preparation of the financial report that gives
a true and fair view in accordance with Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations Act 2001 and for such internal control as the directors determine is
necessary to enable the preparation of the financial report that is free from material misstatement, whether due
to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in
accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical
requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance
whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the
risks of material misstatement of the financial report, whether due to fraud or error. In making those risk
assessments, the auditor considers internal controls relevant to the entity’s preparation of the financial report
that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but
not for the purpose of expressing an opinion on the effectiveness of the entity’s internal controls.
An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates made by the directors, as well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001.
Moore Stephens Sydney ABN 90 773 984 843.
*Other than for the acts or omissions of financial services licensees. An independent member of Moore Stephens International Limited -
members in principal cities throughout the world The Sydney Moore Stephens firm is not a partner or agent of any other Moore Stephens firm.
Liability limited by a scheme approved under Professional Standards Legislation*
46
Auditor’s Opinion
In our opinion, the financial report of Milton Corporation Limited and its Controlled Entities is in accordance with
the Corporations Act 2001, including:
(i) giving a true and fair view of Milton Corporation Limited’s consolidated financial position as at 30
June 2013 and of its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations Regulations 2001.
Report on the Remuneration Report
We have audited the Remuneration Report included in pages 14 to 17 of the directors’ report for the year ended
30 June 2013. The directors of Milton Corporation Limited are responsible for the preparation and presentation
of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is
to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
Auditing Standards.
Auditor’s Opinion
In our opinion the Remuneration Report of Milton Corporation Limited for the year ended 30 June 2013,
complies with section 300A of the Corporations Act 2001.
Matters Relating to the Electronic Publication of the Audited Financial Report
the consolidated entity for the year ended 30 June 2013
This auditor’s report relates to the financial report of
included on Milton Corporation Limited ’s website. The company’s directors are responsible for the integrity of
Milton Corporation Limited’s website. We have not been engaged to report on the integrity of the Milton
Corporation Limited’s website. The auditor’s report refers only to the subject matter described above. It does
not provide an opinion on any other information which may have been hyperlinked to/from these statements. If
users of the financial report are concerned with the inherent risks arising from publication on a website, they are
advised to refer to the hard copy of the audited financial report to confirm the information contained in this
website version of the financial report.
Moore Stephens Sydney
Chartered Accountants
Martin J. (Joe) Shannon
Partner
Dated in Sydney this 8th day of August 2013.
47
DIRECTORY
DIRECTORS
MANAGEMENT
R. D. MILLNER - Chairman
F.G. GOOCH - Managing director
J. F. CHURCH
G.L. CRAMPTON
K.J. ELEY
F. G. GOOCH - Managing director
I. A. POLLARD
D.N. SENEVIRATNE - CFO, secretary
REGISTERED OFFICE AUDITORS
LEVEL 2, 50 PITT STREET MOORE STEPHENS SYDNEY
SYDNEY NSW 2000 CHARTERED ACCOUNTANTS
PHONE: (02) 8006 5357 LEVEL 15
FAX: (02) 9251 7033 135 KING STREET
EMAIL: general@milton.com.au SYDNEY NSW 2000
INTERNET: www.milton.com.au INTERNET:
www.moorestephens.com.au
SHARE REGISTRY
LINK MARKET SERVICES LIMITED
LOCKED BAG A14
SYDNEY SOUTH NSW 1235
PHONE: (02) 8280 7111
FAX: (02) 9261 8489
TOLL FREE: 1800 641 024
EMAIL: registrars@linkmarketservices.com.au
INTERNET: www.linkmarketservices.com.au
48
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