MNF Group Annual Report 2017

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FY2017 Annual Report · MNF Group

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MNF Group Limited
Annual Report 2017

Contents

Board of Directors

Letter from our Chairman

About the MNF Group

MNF Group Timeline

Smart Network

Group of Brands

Company Structure

Business Unit Profiles

Innovation Spotlight

Future Roadmap

Directors’ Report

Consolidated Statement of Profit or Loss and Other Comprehensive Income

Consolidated Statement of Financial Position

Consolidated Statement of Cash Flows

Consolidated Statement of Changes in Equity

Notes to the Consolidated Financial Statements

Directors’ Declaration

Auditor’s Independence Declaration

Independent Auditor’s Report

ASX Additional Information

Board of Directors

Mr Terry Cuthbertson
B. Bus., CA
Chairman

Mr Michael Boorne
Electronics Eng. Dip.
Non-Executive Director

A Chartered Accountant, previously partner at
KPMG with extensive corporate finance expertise
and knowledge. Also a Director and Chairman of
Australian Whisky Holdings Ltd, Austpac Resources
N.L., Mint Wireless Ltd, South American Iron
& Steel Ltd, Malachite Resources Ltd and Non-
Executive Director of Isentric Ltd.

A successful entrepreneur with extensive track
record in combining technical expertise with
commercial and corporate experience. Founder of
Sprit Modems and Mitron Pty Ltd and previously a
Non Executive Director of Netcomm Ltd.

MNF Director since December 2006

Ms Catherine Ly
B.Bus., CPA
Company Secretary since July 2006

MNF Director since March 2006

Mr Andy Fung
B.E. MCom
Non-Executive Director

Extensive experience in telecommunications.
Formerly Director of Business Development of
Lucent Technologies. Co-Founder of MNF Group
Ltd, Symbio Networks Pty Ltd, and Symbio
Wholesale Pty Ltd.

MNF Director since March 2006

Mr Rene Sugo
B.Eng. (Hon)
Chief Executive Officer and Director

Extensive experience in telecommunications.
Formerly Technical Director of Lucent Technologies.
Co-Founder of MNF Group Ltd, Symbio Networks
Pty Ltd, and Symbio Wholesale Pty Ltd.

MNF Director since March 2006

Left to right: Mr Andy Fung, Mr Michael Boorne, Mr Rene Sugo, Mr Terry Cuthbertson

Letter from our Chairman

Fellow Shareholders,

It is with great pleasure that I present to you the 2017
full year results for the MNF Group. It has been another
very successful year for the MNF Group. The company
achieved another financial record, making this the
eighth year of profitable year-on-year growth.

Our consolidated group revenue increased to $192
million, up 19% from the previous year. Our EBITDA
rose by 34% to $23.9 million, and our NPAT rose 34%
to $12.1 million. This year’s result includes 5 months
contribution from our recent acquisition of CCI. The
company ended the year with a strong cash position and
no net debt, and the ability to redraw $15.8 million from
our revolving acquisition facility.

This year’s success is attributed to solid contribution
from all three segments of the business – Domestic
Retail, Domestic Wholesale, and Global Wholesale.
Particularly pleasing was the 24% YoY organic growth
in the Domestic Wholesale segment margin which is
continuing to demonstrate strong growth potential.
Organic growth and the additional 5 months of CCI saw
the Domestic Retail Segment margin up 25% YoY. The
Global Wholesale Segment margin, up organically by
15% YoY, performed in line with expectation, assisted
by new business from network upgrades in London, Los
Angeles and Hong Kong.

This year’s solid performance has allowed the board to declare an annual dividend of 8.25 cents per share fully franked –
an increase of 18% over the previous year. The dividend is consistent with our track record of providing consistent returns
to shareholders in the order of 50% of NPAT.

Achievements

During the year MNF Group grew thanks to some
incredible achievements and the dedication and effort of
our invaluable team. The highlights of our year are:

•

Conference Call
International Acquisition –
The MNF Group acquired CCI in February, the
largest Australian independent audio conferencing
company, with over 5,000 Business Enterprise
and Government customers in Australia and New
Zealand. CCI allows MNF Group to leverage our
Symbio and TNZI platforms to create a dual point of
presence which allows potential for a large network
synergy resulting in a future $500K per annum
EBITDA uplift. We have already begun to see the
benefit of this synergy and will endeavour to grow
and develop CCI within the MNF Business to create
further opportunities and offerings in the future.

•

Continued Organic Growth – The Domestic
Wholesale segment achieved 49% YoY organic

growth in FY16, with an additional 24% organic
growth in FY17. This was due to our service provider
customers growing organically, as well as signing
up new customers. We also have a number of new
initiatives in place for new products, expansion
of existing customers and growth based on new
customers coming online.

• Opening Global Opportunities – The Global
Wholesale segment achieved 15% YoY organic
growth this year. This was largely due to growth in
our Next Generation services being sold to our global
customers. The company this year also finished its
network upgrade and transformation project of the
TNZI network, upgrading London and Los Angeles,
and building Hong Kong. Additionally, the company
has completed a New Zealand domestic network
upgrade enabling further trans-Tasman growth.

The Future

three very solid
The company has established
independently performing business segments, each with
a well-defined strategy for growth. The Domestic Retail
segment is performing steadily with some good potential
in addressing small business and government customers.
The Domestic Wholesale segment has excellent
momentum coming out of last year, and is poised to
capitalise on the company’s position in the domestic
market. And finally, the Global Wholesale segment will
continue to sell and expand its Next Generation products
and footprint into the global market.

In addition to developing our own organic four-
dimensional growth strategy, the company continues to
seek sensible acquisitions that will deliver incremental
value to shareholders. Our goal is to find opportunities
that allow us to leverage our strong
intellectual
property assets, incredibly skilled team, and massive
synergy potential of our nationally and internationally
interconnected voice network.

continually developing new

Additionally, we see ourselves as a disruptor in the
market,
technology
and software processes that will allow us to deliver
innovative products and solutions to our customers.
As our company grows so does our strategy and we
will continue to focus around our core strength being
enabling voice communications. We see ourselves as an
integrated telecommunications software and network

provider, specialising in Internet communications. The
MNF Group is truly in a unique position to explore new
opportunities and challenge the industry norm to push
the boundaries and cement our position as a credible
player in both the Australian and global markets.

On behalf of the board, I would like to thank all the staff
and management team in achieving another great result.
Without the hard work and dedication from a highly
specialised and skilled team we would not be where
we are today. The board continues to provide its full
support to the team to ensure the company maintains
its momentum and growth into the future.

I would also like to thank my fellow members of the
Board for their hard work and dedication over the last
12 months. Their insight and vision has truly shaped an
innovative and successful organisation that stands out
as a rapidly emerging player in the Australian and global
telecommunications market.

I thank all shareholders for your continued and loyal
support. The company is looking forward to a successful
and rewarding year ahead.

Terry Cuthbertson

Chairman

MNF Company Value

We want to achieve great things. We do our best
work every day. We are accountable for the work we
produce. We are committed to delivering the highest
quality work and value possible through relevant
service & solutions.

Deliver excellence

About the MNF Group

MNF Group is an integrated voice services business that provides IP communication technologies to Australia, New
Zealand and the world.

The Group was founded in Sydney in 2004, and listed on the Australian Stock Exchange in 2006 (ASX: MNF). Now a
global business, the Group has grown from strength to strength in just over a decade and received many industry and
retail awards.

Our people

Our capabilities

Brands & customers

Powering the dynamic product &
brand mix is a specialist team of
almost 250 staff across offices in
Australia, New Zealand, UK and
USA.

The team’s track record of
innovation positions the Group as
a disruptor in the communications
market.

MNF Group specialises in the
delivery of voice communications
capabilities around the globe.

The Group’s smart IP voice network
delivers a diversified portfolio of
voice products to over 250 global
providers and 100,000 retail
customers across multiple brands.

Each brand in the MNF Group
portfolio services a defined target
market with products designed to
meet evolving user needs.

Customer profiles span next-
generation service providers,
carriers, business and government,
right through to mums & dads.

software

products

smart IP
network

global

offices in
AUS NZ UK US

innovation

people

Global
Communications
Specialist

customers

wholesale

retail

value-added

domestic

international

SaaS

diversified voice
portfolio

brands

Key brands and products

next-gen
providers

carriers &
service providers

business, enterprise
& government

mums & dads

MNF Group Timeline

A
D
T
I
B
E

$24M

$22M

$20M

$18M

$16M

$14M

$12M

$10M

$8M

$6M

$4M

$2M

• Tasmanian
Government $20M
Project win

• Acquisition of
CallStream
Connexus
GoTalk Wholesale

• Exclusive Panasonic
deal for SME phone
system

• Acquisition of
Symbio Networks

• Maiden Profit
• ADSL2+ service
launch

2009

2010

2011

2012

• Acquisition of

CCI

• TNZI integration

• US completion

• Acquisition of
TNZI global voice
network & OpenCA
Softswitch

• Integration of prior-
year acquisitions

• Acquisition of
Pennytel & iBoss

• Strong organic
growth

• CeBIT Outstanding
Project Award for
Tasmanian Governemnt
Voice Carriage Project

2013

2014

2015

2016

2017

Smart Network

As the world moves to IP communications, MNF Group
is building the network and technology to lead the way.

progressively rolling out these smart network capabilities
to the rest of its global network.

Global Scale

MNF Group’s Tier 1 carrier network spans the globe with
Points of presence in Los Angeles, New York, Hong Kong,
Singapore, London, Frankfurt, Sydney and Auckland and
over 200 partner interconnects.

Having developed market-leading managed voice
services for its Australian network, the Group is now

Unlike traditional carriers, the Group’s focus is on
making it easy for service providers to do business – The
Group’s smart network enables easy integration and has
the flexibility to meet evolving customer needs.

These innovative capabilities combined with first-mover
advantage puts the MNF Group in prime position to be
the carrier of choice for providers looking to reach the
fast-growing Asia Pacific region.

San Jose

London

New York

London

AAG

Los Angeles

San Jose

London

Frankfurt

SWM-4

S. Korea
SWM-3

Saudi Arabia

UAE

Hong Kong

SWM-3

Oman
SWM-3

Vietnam

Thailand
SWM-3

SWM-3

SJC

Taiwan
AAG

Sri Lanka

Malaysia

EASSy

SWM-4

Singapore

Indonesia

Japan

AJC

Guam

AJC

Mozambique

SWM-3

A-PNG-2

SCCN

Tonga

Norfolk Is.

Auckland

Sydney

SCCN

TAS-2

Perth

Darwin

Nauru

PNG

Vanuatu

Fiji

SCCN

Tokelau
W. Samoa

Cook Is.

Niue

Perth

Brisbane

Auckland

Adelaide

Sydney

Canberra

Melbourne

Hobart

Domestic Expertise

In Australia, the Group owns and operates the country’s
largest IP voice network and has established a robust
network presence in New Zealand.

High speed fibre connectivity between major cities and
modern VoIP nodes in all 65 regional call collection
areas make this network the ‘go to’ for new-generation
OTT providers and global carriers looking to establish or
expand their presence in Australia and New Zealand.

Group of Brands

As the global voice specialist, MNF Group delivers comprehensive communications solutions through a diversified
product portfolio offered across 3 key market segments.

The multi-brand approach empowers the Group to tailor solutions to different customer needs while eliminating the
risk of relying on any one product in today’s fast-paced technology environment. From call termination for global Tier 1
carriers, API-powered smarts for new-generation app players, innovative fraud prevention, to voice and data for home
and business, MNF Group powers all levels of the IP voice revolution. The Group gathers consumer insights across all
these segments to continue developing innovative software solutions and address customer needs in the changing
communications landscape.

Domestic Retail

Domestic Wholesale

Stable performance, with several strategic wins in
enterprise and government sectors. Growth focus on
SME with Virtual PBX refresh and strong pipeline of
enterprise prospects.

Fastest organically growing segment, with gross margin
increasing 49% on previous year. Continued strong
Australian performance and full deployment of New
Zealand network underway.

SIP Trunking

Virtual PBX

Pre-select

Business Internet

Call termination

13, 1300,1800
numbers

Inbound &
Virtual Numbers
& Porting

Number
Porting

Conferencing

Home
internet

VoIP home
phone

Aus
Domestic
Retail

Aus&NZ
Domestic
Wholesale

Global
Wholesale

Co-location

Call Data
Feeds

Wholesale
aggregation

Data
enablement

MVNO

Voice carriage

Billing

ITFS

Inbound &
Virtual Numbers

Class 4
Softswitch

Toll Fraud
prevention

Global Wholesale

Strong track record in global voice termination, leveraging global tier 1
reputation. Addition of new-generation services such as freephone and
local numbers, and TollShield® is set to drive further growth.

Company Structure

London, 4

Toronto

Los Angeles

Global voice services business,
headquartered in Sydney

Darwin

Sydney, 161

Auckland, 2

Melbourne and
Mt. Eliza, 92

Wellington, 43

*Headcount September 2017

Hobart, 3

While operating across Australia, New Zealand, UK and USA, MNF Group’s structure is defined by function rather than
geography, with several Business Units headed by highly skilled and experienced Chief Executives.

Each unit focuses on a particular functional area and works across multiple brands, products and even office locations.
This structure allows the Group to develop & leverage subject matter expertise of various teams to support a multi-
brand strategy while ensuring operational efficiency.

Rene Sugo
CEO

Indika
Nanayakkara
CTO

Tim Dunning
President - Global
Commercial

Jon Cleaver
CCO

Ritsa Hime
COO

Matthew Gepp
CFO

Helen Fraser
General Counsel

Platform &
Networks
Business Unit

Global
Commercial
Business Unit

Domestic
Commercial
Business Unit

Operations
Business Unit

Finance
Business Unit

Legal

Commitment to Innovation

Business Unit Headcount

While expanding internationally, the MNF Group remain
committed to in-house Research & Development and
bringing disruptive new products to market.

Approximately 25% of the Group headcount, residing
in the Platform & Networks Business Unit, works in
the R&D field. This includes new product development,
new features, user experience improvement and core
network stability and expansion.

Global
Commercial
6%

Domestic
Commercial
27%

Legal
1%

Finance
8%

Platform &
Networks
27%

Operations
31%

Business Unit Profiles

Domestic Commercial
Business Unit
Jon Cleaver, CCO

Global Commercial
Business Unit
Tim Dunning, President

The Domestic Commercial Business Unit is responsible
for the Sales, Marketing & Product Strategy within
Australia and New Zealand across all Consumer and
Wholesale segments. 2017 was all about execution.
With a clear growth strategy, a market going through
its next major revolution and industry leading products
& capabilities - you have a recipe for success. However
even with the best ingredients, execution comes down
to our people.

“I am very proud of the team. The structure,
commitment and team dynamics are just right to
continue to maximise our 4 dimensional growth
strategy,” said Jon Cleaver, CCO. “Whilst others in
the market have been hurt by NBN, our segment and
product diversification and investment in developing
our own capabilities resulted in us being unscathed,
yet ready to act.”

Conference Call International has been seamlessly
into MNF Group, adding advanced
integrated
conferencing capabilities to our portfolio. The previous
year’s learnings and focus on process and training
meant we could achieve acquisition growth without
undermining continued strong organic performance.
With the continual rise in contextual communication,
MNF’s complete UC offerings and added mobility
capabilities, this Business Unit
is committed to
executing a high growth strategy.

The Global Commercial Business Unit represents the
international arm of MNF Group, carrying voice traffic
from Australia and New Zealand to any destination in
the world on the TNZI network. Results this financial
year have been strong with both the TNZI and Symbio
Networks brands substantially outperforming the
market across all product lines in a highly challenging
integration
environment. With the major MNF
components complete, we have increasingly focused
toward our customers and suppliers and have received
best in class independent survey data confirming the
efficacy of this approach.

undergoing

Global wholesale
significant
transformation, with high-speed data networks, falling
prices for smartphones and other devices supporting
Over the Top (OTT) calling applications that bypass
traditional business models.

“We are well positioned to take advantage of accelerating
disruption in the international voice market,” said
President, Tim Dunning. “Recent investments in network
infrastructure, product innovation and human resources
are facilitating enhanced market share on existing
product lines as well as new product models during this
market metamorphosis. We look forward to the new
financial year in the knowledge that transformation
creates opportunities for nimble operators to grow and
prosper.”

Operation Business Unit
Ritsa Hime,
COO

Finance Business Unit
Matthew Gepp,
CFO

The Operations Business Unit
is responsible for
ensuring the entire customer journey from sign-on
including service delivery, technical support, billing
and invoicing and escalation management meets their
expectations. The Operations Business Unit structure
supports the company’s multi brand strategy across all
customer segments and works closely with all Business
Units to ensure processes are effective and the staff
knowledgeable.

On joining MNF Group, Ritsa set a 5 year strategic
initiative roadmap to deliver excellent experience for
customers. The success of this initiative this year is
evident in the feedback from consumer customers
and their associated NPS results with notably high
performance in first call resolution.

“My teams actively engage and seek opportunities
to work with the Product Management team, Sales
teams and Platforms and Networks Business Unit
as part of our Innovation program,” said Ritsa Hime,
COO. “Our collaboration has enabled MNF Group to
successfully launch several online applications and
tools to enhance our customers’ use of our services in
real-time. We have set a 12-18 month implementation
plan to deliver on our customer experience initiatives.
We’re achieving this by improving our responsiveness,
ownership for first-call-resolution and online self-
serve capability.”

With a year-on-year increase in NPAT of 34% to $12.1m,
FY17 saw MNF Group deliver its ninth straight year of
profitable growth. This was largely underpinned by
organic growth, which is a testament to our impressive
product, as well as the continuous efforts of our sales
teams. All three segments delivered improved results
on the prior year, with the Australian domestic retail
segment growing by 7%.

We are also impressed with the performance of the
Conference Call International (CCI) acquisition that
completed in February, both in terms of results delivered
and the additional product capability that CCI brings to
the Group. Work has already commenced to integrate the
CCI product into our technical eco-system.

“With our four dimensional growth strategy in place, all
of the business units are focussed on delivering continued
growth as we embark on another exciting year,” said
CFO Mathew Gepp. “The Finance BU will continue its
focus on supporting the business and delivering timely
information and intelligence to the teams that will
assist and guide critical decision making. This will include
scrutinising potential acquisitions and promoting sensible
organic growth strategies. We will at all times ensure that
preserving and creating shareholder value is at the core of
our decision making process.”

Platform & Networks
Indika Nanayakkara,
CTO

Legal Services Unit
Helen Fraser,
General Counsel

The Platforms and Networks Business Unit builds and
operates the infrastructure and software systems
which underpin the suite of products and services
delivered by the MNF Group.

FY2017 was another exciting year with some highlights
being the major expansion of the New Zealand
domestic network, metadata retention compliance
and MVNO launch as well as ongoing enhancements to
the Australian domestic network and the TNZI global
network.

“The in-house software development and systems
integration skills continue to be a key differentiator for
the MNF Group, with the team’s capabilities providing
the organisation with the agility required to adapt
to the rapidly changing technology and competitive
landscape,” said CTO, Indika Nanayakkara. “The in-
house development skills are reflected in the numerous
awards for innovation that MNF Group has won over
the last year.”

FY2018 is expected to be another exciting year with
many development activities being planned to leverage
the infrastructure, intellectual property and software
systems that the MNF Group has developed over the
years. Some of the highlights being expanding presence
in Asia and growing the mobile products suite.

The Legal Services unit provides advice and support
to the Board and the business as a whole on strategic
projects as well as on operational matters. Advice
areas include acquisitions, transactions, corporate
governance, regulatory matters, consumer law and
dispute resolution.

The Legal Services unit plays an integral role in key
growth areas of the business. In FY17, practical legal
advice and solutions have been provided in relation to
the group’s MVNO product offering, the CCI acquisition,
expansion of the Symbio domestic wholesale business
into New Zealand and obtaining TNZI’s Hong Kong
telecommunications licence. A major focus remains
day to day contract advice and negotiation in support
of wholesale business development and strategic
partnerships.

The Legal Services unit works closely with stakeholders
to align
its activities with the group’s business
objectives and seeks efficiencies through standardised
and scalable frameworks and solutions. We continually
strive to balance protection of the company’s legal
interests with improving our customers’ experiences
in terms of time and effort to contract.

Pulse

MyNetFone Pulse™ is an advanced call flow management tool designed for inbound
contact centres that experience volatile traffic peaks.

With Pulse, you have direct control over your inbound call flows, and can change call
routing in real time. When call volumes surge, you can respond with speed and precision.

Real-time management

Location-based call flows

Execute advanced overflow rules with one
click. Within seconds you can overflow calls
to an IVR menu, pre-recorded message or
alternative contact centre.

Customise call flows based on the caller’s
location and time of day. This is ideal when
managing calls from an after-hours crisis or
a localised outage.

Call avalanche

13/1300

1800

Respond in real-time

You can’t predict a crisis or outage. But you
already know the impact on your contact
centre. Thousands of calls. Overwhelmed
staff. Frustrated customers. Sound familiar?

Pulse allows you to manage extreme call peaks
through preconfigured overflow rules. Simply
log into the online portal, select the affected
regions, and overflow calls.

Option A: Broadcast / IVR

Option B: Alternate call centre

Keep customers up to date by playing an audio
message or interactive menu (IVR). Upload a pre-
recorded message, or create a new one directly
within the Pulse portal.

Pulse lets you distribute your excess calls to
other Australian or international contact
centres. If those contact centres are on the
MyNetFone network, diversion will be free.

Option C: Business as usual

Geo-verification means that you will only
divert the calls coming in from the regions
that you specify. All other calls will flow
through as normal.

iBoss

iBoss operates an industry-proven telecommunications enablement platform and
aggregation service. With over a decade of in-house proprietary IP and continual
improvements from our R&D team, iBoss is the industry leader in the wholesale enablement
and aggregation market.

iBoss is powered by Symbio Networks, which owns and operates Australia’s largest VoIP
network. Backed by an ASX listed company, Symbio Networks is an established and reliable
telecommunications industry leader.

Speed to market
iBoss is fully integrated to resell white-label mobile services on Australia’s premier 4G mobile
network.

With our expert team and streamlined on-boarding process, you can go to market in just 4
weeks.

BYO brand
Leverage your existing brand value. Create new revenue streams by adding your brand to our
white label 4G mobile services.

Add complementary mobile products to your core business and increase customer engagement
and reach.

Stay focused
We take care of the regulatory compliance and provide an end-to-end billing solution.

So you can stay focused on growing your business.

Your
brand

Operations &
Provisioning

Billing &
Payments

Plans & Rating

Ordering

Provisioning

Service management

Workflow management

Invoicing

Billing

Payments

Debt collection

CRM &
Marketing

Customer communications

Self-service portal

Future Roadmap

The next step in the new-generation voice communications evolution is “any to any” connectivity, with applications
working across all devices. This requires smart networks and applications that act as the glue between the ever growing
ecosystems of devices. MNF Group is a credible small player in this very big and still growing market, with plenty of
opportunity for growth. An expert in new-generation voice, MNF has the first-mover advantage in delivering these
communication solutions of the future.

While other telcos ‘traditional’ networks are being dug out of the ground, MNF Group’s smart network is already
delivering the building blocks of the future.

Geographic
Expansion

Enhanced Software
Capabilities

New Customer
Acquisition

Existing Customer
Expansion

Domestic Wholesale

Domestic Retail

Global Wholesale

Execute strategy of being
the enabler of choice for
small service providers in the
Australia and NZ.

Develop ground breaking
software solutions.

Domestic market leveraging.

Residential

Small Business

Government & Enterprise

Conference Call International

Execute TNZI post-acquisition
strategy.

Increase market share of legacy
usage based products.

Managed service products in
global markets.

Develop infrastructure and
relationships in the Asia-Pacific
region.

MNF Group Limited

ABN 37 118 699 853

30 June 2017
Annual Financial Report

Directors’
Report

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report

For the year ended 30 June 2017

Your directors present this report, together with the financial statements of the Group, being the company and its
controlled entities, for the financial year ended 30 June 2017.

Board of Directors

The names and details of the company’s directors in office during the financial year and until the date of this report are
set out below. Directors were in office for this entire period unless otherwise stated.

Names, qualifications, experience, special responsibilities and other directorships

Terry Cuthbertson, B.Bus., CA.
Non-executive Chairman

Mr Cuthbertson joined MNF Group Limited in March 2006 as the Group Chairman. He also serves on the Group’s Audit
and Remuneration Committees. He was previously a partner of KPMG and has extensive corporate finance expertise and
knowledge.

Directorships of listed companies in the last three years:

Chairman, Austpac Resources N.L. from 2004 (Director from 2001); Chairman, Australian Whisky Holdings Ltd from
2004; Chairman, Mint Wireless Ltd from 2008 (Director from 2007); Chairman, South American Iron & Steel Corporation
Ltd from 2009; Chairman, Malachite Resources Ltd from 2013 (Director from 2012); Director, Isentric Ltd from 2010.

Michael Boorne, Electronics Eng. Dip.
Non-executive Director

Mr Boorne joined MNF Group Limited in December 2006 as an independent Non-executive Director. He also serves as
the Chairman of the Audit and Remuneration committees. He is a successful entrepreneur with extensive experience
in combining technical expertise with commercial and corporate experience. He has founded start-up businesses
Sprit Modems and Mitron, and is a director and committee member of numerous private companies and charitable
foundations. He was previously a Non-executive Director of Netcomm Ltd.

Andy Fung, B.E. MCom.
Non-executive Director

Mr Fung is a co-founder of MNF Group Limited. He was formerly Managing Director of the group, serving as an Executive
Director from 2006 until 2012. Mr Fung has served as a Non-executive Director since 2012. He also serves on the Group’s
Audit and Remuneration committees.

Mr Fung has had extensive industry experience in Australia and Asia, having previously held senior management positions
with Telstra, Australian Trade Commission and Optus. He is a director of several private companies with interests in
financial services, infrastructure, trade and investments between Australia and Asia.

Mr Rene Sugo, B.Eng. (Hon).
Chief Executive Officer and Executive Director

Mr Sugo is a co-founder of MNF Group Limited. He has served as Chief Executive Officer since 2012. Mr Sugo was formerly
Technical Director of the group. He is a director of all MNF Group operating companies globally, and also serves on the
Group’s Audit and Remuneration committees.

Mr Sugo is a strong industry advocate, representing the interests of MNF Group and competition in general. He has been
a director of the Australian Communications Alliance and the INMS (Industry Number Management Services) since 2015.
Mr Sugo sits on various industry committees locally and overseas including the ITW Global Leaders Forum (GLF). Mr
Sugo also regularly contributes articles and opinions on issues affecting the industry, such as the NBN, regulatory policy
and innovation.

Company Secretary

Ms. Catherine Ly, B.Bus., CPA.

Ms Ly has been the Company Secretary of MNF Group Limited since 2006. She has been a certified practising accountant
for over 20 years.

www.mnfgroup.limited

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

Board and Committee Meetings

From 1 July 2016 to 30 June 2017, the directors held 14 board meetings and 2 audit committee meetings. Each director’s
attendance at those meetings is set out in the following table:

Directors

Mr. Terry Cuthbertson

Mr. Michael Boorne

Mr. Andy Fung

Mr. Rene Sugo

Board

Audit

Eligible to attend

Attended

Eligible to attend

Attended

Principal activities and significant changes in nature of activities

The principal activity of the MNF Group is providing voice, data, and cloud based communication and communication
enablement services to residential, business, government and wholesale customers in Australia and internationally.

In the financial year the MNF Group derived revenue from the sale of the above mentioned communications services.
These fees consist of recurring charges for access to facilities and capabilities, as well as consumption charges for variable
usage of those facilities. Revenue was also derived from the sale of hardware, equipment and consulting services to
support the primary products of the business.

The company operates in three main segments:

• Domestic Retail – based on the original MyNetFone brand and other retail acquisitions, focusing on selling directly

to residential, small business, enterprise and government customers;

• Domestic Wholesale – based on the original Symbio Networks brand, focussing on selling to Australian & New

Zealand domestic carriers, carriage service providers (CSP), cloud providers and application providers; and

• Global Wholesale – based on the TNZI acquisition and pre-existing global customers, focusing on selling to global

carriers, carriage service providers (CSP), cloud providers and application providers.

The overall nature of the business has not changed during the financial year.

Operating Result

Excluding cost associated with acquisitions, earnings before interest expense, tax expense, depreciation and amortisation
expense (EBITDA) increased by 34% to $23.9 million, with net profit after tax (NPAT) increasing by 34% to $12.1 million,
compared to the prior year.

The result is slightly ahead of guidance, with EBITDA 1.0% above guidance and NPAT 4.3% above guidance. Revenue
increased 19% to $191.8 million.

The total dividend for the full year has increased by 18% to 8.25 cents per share (fully franked), with the company
declaring a final dividend of 4.50 cents per share for the second half of the 2017 financial year. The full year dividend
payments represent 50% of the 2017 full year net profit after tax.

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

MNF performance at a glance:

200

180

160

140

120

100

FY13 FY14 FY15 FY16 FY17

EBITDA
$23.9 Million

FY17 EBITDA increased 34% on the
PY to $23.9. The result includes 5
months contribution from CCI and
is slightly ahead of guidance.

EPS
17.32¢

EPS at 17.32c represents an
increase of 29% on the PY. The
5 year CAGR on EPS of 26%
demonstrates the consistent
long term shareholder returns
delivered from the business.

REVENUE
$192 Million

MARGIN
$59 Million

FY17 Revenue increased 19% on the
prior year (PY) to $192m. This result
includes a full 12 months revenue
from TNZI US (1 month in FY16)
plus 5 months contribution from
the CCI acquisition, combined with
strong organic growth in all three
business segment.

FY17 Margin
increased $10.0m
or 21% on the PY to $59m. The
Domestic Retail segment margin
increased $3.8m, helped by the
inclusion of CCI in February ($2.8m)
and organically ($1.0m). Organic
growth in the Domestic Wholesale
(24%) and Global Wholesale (16%)
segments contributed strongly.

FY13 FY14 FY15 FY16 FY17

NPAT
$12.1 Million

FY17 NPAT increased 34% on the
PY to $12.1m, an excellent result
which was 4% ahead of guidance.
The 5 year CAGR on NPAT is 31%.

12.0

10.0

8.0

6.0

4.0

2.0

0.0

FY13 FY14 FY15 FY16 FY17

18.0

16.0

14.0

12.0

10.0

8.0

6.0

4.0

2.0

0.0

9.0

8.0

7.0

6.0

5.0

4.0

3.0

2.0

1.0

0.0

FY13 FY14 FY15 FY16 FY17

DIVIDEND
8.25¢

A final declared dividend of 4.50c
brings the full year dividend to
8.25c, an 18% increase on the PY.
The full year dividend represents
50% of NPAT, this ratio is
consistent with prior years.

www.mnfgroup.limited

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

Review of operations

A review of the operations of the entity during the financial year and the results of those operations are as follows:

Record Margin and EBITDA

The gross profit for the year was up 21% to $58.6m (2016: $48.6m).

The Net profit after tax (NPAT) for the year was $12.1m (2016: $9.0m) with Earnings per share (EPS) climbing 29% to 17.32
cents per share (2016: 13.45 cents per share).

Year ended 30 June 2017

Year ended 30 June 2016

% change

$191.8m

$58.6m

$23.9m

$12.1m

$161.2m

$48.6m

$17.8m

$9.0m

17.32 cents

13.45 cents

+19%

+21%

+34%

+29%

Revenue

Gross profit

EBITDA

NPAT

EPS

Cash and debt

The closing cash balance as at 30 June 2017 was $52.4m (2016: $52.9m).

At year end gross debt in the form of a $27.0m revolving acquisition facility was $11.2m (2016: 13.7m).
$2.5m of gross debt was paid down during the year.

The company had no net debt as at year end.

Acquisitions:

On 1 February 2017 MNF Group Limited acquired Conference Call International Pty Limited (CCI).

The purchase price of CCI was $18.0m. After allowing for working capital adjustments ($0.4m) and cash acquired with
the business ($0.6m) the net amount paid for CCI was $17.0m. (Refer note 23 in the attached Financial Statements). This
net price represents a multiple of less than 4.5 times FY17 pro-rated EBITDA contribution.

CCI operates through three established brands, with an extensive portfolio of over 5,000 business and enterprise
customers, including many top 500 Australian enterprises and a scalable state of the art audio conferencing service
platform. CCI has performed marginally ahead of expectations in the 5 months to June and as expected this acquisition
has been EPS accretive in FY17.

Business outlook

The MNF Group is now operating three very solid independent segments – Domestic Retail, Domestic Wholesale
and Global Wholesale. Inside each segment are multiple product lines with excellent diversity of customers and
profit contribution. All segments operate in our core area of specialisation, being enabling new and disruptive voice
communications through software development and network deployment. Each segment has a well-defined strategy
for investment and growth. The business is confident of sustainable organic gross margin and profit growth across all
three segments.

Additionally, the business has shown an ability to find value accretive acquisitions and integrate them quickly and
effectively to improve the overall performance of the business. With a discerning and conservative approach, the Board
of MNF Group will continue to actively search for further acquisition opportunities; whilst the business remains totally
committed to driving organic growth and overall financial performance within the business.

Domestic Retail Segment

This segment is based on the original MyNetFone brand and other retail acquisitions, focussing on selling directly to
residential, small business, enterprise & government customers. The CCI acquisition is now recorded in this segment.

The domestic retail segment delivered a margin contribution to the group of $18.9m. That is a $3.8m (25%) increase on
the prior year. The addition of CCI to this segment in February 2017 was the primary driver of this growth, contributing

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

$2.8m of the $3.8m increase. Excluding CCI from this growth, the Domestic Retail Segment grew organically by around
7%. This organic growth comes following a year of no growth in this segment and is an encouraging sign for the future
of this segment - the overall organic growth is a result of small business and enterprise & government growth outpacing
the ongoing gradual decline in the residential space.

a. Residential

The Residential sub-segment consists of selling residential VoIP, DSL broadband and NBN broadband to consumers in
Australia. The sub-segment operates under the brands of MyNetFone, PennyTel and theBuzz. Each brand has its own
value proposition, web site, and product range; however, all brands are operated across the same network and same
operations team, providing a high level of synergy. Despite the decline in the residential sub-segment it is still viewed as
providing critical mass and volume and an opportunity for future growth.

The residential voice market is declining due to the market shift towards mobile communications and mobile-cap plans.
The group however has been implementing a defensive strategy of cross selling DSL broadband services, and NBN
broadband services into this customer base. This action has stemmed the decline in revenue and margin, and provided
a useful retention tool.

The residential data subscriber base increased to 12,900 services in operation up 8% on the PY, and the VoIP base fell
slightly overall to 88,600 services in operation. The increase in data services resulted from an increased take-up of
NBN services, however MNF continues to be sub-scale in terms of NBN reach. The business has improved NBN reach by
being certified across all access types, and putting in place backhaul agreements to be able to reach all 121 Points-of-
Interconnect (POI). Total residential subscriptions across all brands was steady year-on-year at 106,000.

In terms of new customer acquisition the business is now gaining more new NBN customers than it is new DSL customers.
This is consistent with the NBN deployment breaking through the 50% population coverage milestone. The NBN still
presents big challenges to smaller broadband companies like MNF – being the ability to reach 121 POI nationally, the
usage based cost of the Connectivity Virtual Circuit (CVC), and the explosion in data usage demands of consumers due
to the adoption of over-the-top (OTT) video and content services, and strong competition from NBN bypass services
(Mobile Broadband, Fibre-to-the-Basement and Fixed Wireless).

The company is still committed to servicing the residential customer base as it provides a large user base generating
solid margins on the VoIP and data products. The base also provides an opportunity for further innovation and potential
growth in an NBN era. The business is looking at innovative ways to grow scale on the NBN, including acquisitions of
additional subscriber bases and new marketing techniques.

b. Small Business

The Small Business sub-segment consists of selling business grade MyNetFone Virtual PBX and SIP trunks, as well as
business grade DSL, NBN and Ethernet broadband services within Australia. The sub-segment operates under the brands
MyNetFone, Connexus and CallStream. Each brand has its own value proposition, web site, and product range; however,
all brands are operated across the same network and same operations team, providing a high level of synergy. The small
business market sub-segment is strategic to MNF with strong prospects for future growth.

The company has some leading products in the market and continues to innovate. The NBN roll out will provide additional
growth impetus to this segment when the NBN reaches more centralised business areas, as it will force customers to
move off legacy copper PSTN services and find new alternatives for telephony.

The Virtual PBX and SIP trunk products in service grew by 5% to 3,400 services in operation, and overall business voice
services grew slightly to 8,600 services in operation. Revenue and margin from business voice has grown in 2017. Business
data services grew 5% to 2,100 services in operation, mainly due to growth in NBN take-up.

In terms of new customer acquisition the business continues to push the Virtual PBX as the leading service. The business
has recently re-launched the business customer web site - https://business.mynetfone.com.au/ - as well as released
higher value included plans which are very popular. The product is undergoing a cosmetic and feature refresh which
should be completed by the end of the year. Based on our competitive analysis, the product is still very strong in terms
of price and functionality when compared to all competitors selling a hosted PBX product. The business is constantly
looking at new ways to market effectively whilst keeping costs under control.

c. Enterprise & Government

The Enterprise & Government sub-segment consists of selling enterprise grade MyNetFone SIP trunks and other value
added services to enterprise and government organisations within Australia. The sub-segment operates under the
MyNetFone brand. This sub-segment is strategic to the group with strong organic growth in the last 12 months, and an

www.mnfgroup.limited

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

excellent pipeline of prospects looking forward to next year.

In February MyNetFone Australia was appointed to the Voice Services Panel for the Victorian Government as part of
that Government’s Telecommunication Purchasing and Management Strategy 2025 (TPAMS2025). This appointment is
expected to lead to substantial opportunities for the group in the medium term.

The company has adopted a long-term strategy to pursue domestic government business as VoIP technology increases
its foothold in all levels of government. The Enterprise & Government sector is generally more conservative than small
business, and the migration to next generation telephony has been lagging that of small business. However recently
the sector has been more focussed on cost reduction and efficiency, resulting in the increased rate of migration into
centralised private cloud telephony services, and the need for data centre based high capacity centralised SIP trunks. This
is the same model adopted by the Tasmanian Government in 2012 which was a pioneer in this space.

MyNetFone had initial success with the Tasmanian Government in 2012, where it was awarded a long term contract
to provide telephony services to government. Late last year the Tasmanian Government has elected to exercise all
extensions to the initial contract, securing MyNetFone as an exclusive supplier of voice carriage until 2022. MyNetFone
is also actively engaged with the Tasmanian Government in providing additional value added services and product
innovation to assist the Government in delivering services to its constituents.

Last year the company has also secured several large contracts with government enterprises in NSW. These contracts
are for inbound and outbound voice carriage, as well as value added services and product innovation. These are multi-
year contracts with initial terms of 3 years, and potential extensions of up to 7 years. The company has successfully
completed the implementation of these services during the financial year.

Based on recent success with both Tasmanian and NSW government enterprises, the company is increasing its resourcing
to support and drive growth in the Enterprise & Government sector. These additional resources are in the area of business
development, account management, bid management and customer life cycle management.

The company currently holds the following government certifications: Victorian Government Telecommunication
Purchasing and Management Strategy 2025 (TPAMS2025), Municipal Association of Victoria (MAV), Western Australian
Local Government Association (WALGA), NSW Procurement ICT Services Scheme, Queensland Government IT&T
Procurement Panel and Tasmanian Government. As a result of these efforts the company is winning successful business
with many local governments, universities and several state government departments around Australia. The company
continues to pursue additional Government certifications and tenders in other areas.

The company also maintains several key certifications with leading enterprise grade equipment vendors such as:
Microsoft, Cisco, Avaya, Samsung, Panasonic and many others. The company is still the only carriage service provider in
Australia certified by Microsoft for the Lync unified communications platform.

d. Conference Call International (CCI)

The CCI sub-segment consists of the business assets, customers and operations of Conference Call International
Pty Ltd acquired in February 2017. The CCI business involved selling audio conferencing and collaboration services to
business customers in Australia and New Zealand. The business owns and operates three main brands – OzLink, Eureka
Conferencing and Express Virtual Meetings. Each brand services a different set of user needs in this space.

During the first 5 months since acquisition the CCI business has performed well, slightly ahead of expectation in terms
of contribution.

The company has integrated CCI into its Domestic Retail strategy. The CCI product suite is highly complementary for
the Small Business, and the Enterprise & Government sub-segments. As such the company has started cross selling CCI
products into existing customers in those sub-segments, as well as incorporating CCI services into tenders and bids. The
company is looking to further invest into the CCI platforms to develop more value-added services which will continue to
enhance the offers and provide future growth for this specialised sub-segment.

Domestic Wholesale Segment

This segment is based on the original Symbio Networks brand, and includes the iBoss software platform. The segment
is focussed on selling to Australian & New Zealand domestic carriers, carriage service providers (CSP), cloud providers
and application providers. This segment is strategic to the group and continues to experience strong organic growth.

The key products sold into this market are:

1. Wholesale voice – termination of high volume wholesale voice minutes;
2. Wholesale managed services – providing unbranded capabilities and services such as Local Number Portability,

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

voice end-points, phone numbers, and numerous other in-house developed cloud based value added services;

3. Wholesale aggregation services on the iBoss software platform – providing customer branded services such as: DSL
broadband, NBN broadband, Legacy ISDN/PSTN voice resale, mobile telephony resale and also providing access to
the complete suite of Symbio wholesale managed services;

Software-as-a-Service (SaaS) – leveraging the company’s extensive software intellectual property assets and
monetising them by means of selling cloud based capabilities on a monthly recurring basis. The main product is the
iBoss enablement platform.

These products leverage the extensive fully interconnected national voice network that is also used to carry the group’s
retail and globally originated traffic, in addition to an extensive amount of proprietary intellectual property that has
been developed by the company over the last 15 years.

The domestic wholesale business is currently hosting over 287 unique service provider customers, an increase of 21% on
the previous year. Each customer generally purchases one or more products from the above suite of products. In addition
to the increase in service provider customers, the customers themselves are generally growing organically, providing a
compounding growth effect – hence the strong margin growth for this segment.

Services provided in this segment continue to experience strong growth, with Local Number Portability (LNP) growing
29% to 645,000 inbound ported numbers, and the total volume of hosted Direct-In-Dial (DID) numbers growing 15% to
3.1 million numbers. Wholesale aggregation subscriptions (iBoss) increased to 5,500, up 83% on the prior year.

Global Wholesale Segment

This segment is based on the TNZI brand and customers, together with Symbio customers that are global operators and
managed by the team out of Wellington. The segment is focussed on selling to global carriers, carriage service providers
(CSP), cloud providers and application providers. This segment is strategic to the group and has the biggest potential for
long term organic growth through leveraging its global market reach to sell the company’s high margin products. Initial
focus for global growth is the Asia-Pacific region where the opportunity and the company is strongest.

The main product sold by TNZI has historically been global voice termination. The TNZI brand operates high quality
voice termination to all countries around the globe through direct and indirect partnerships. TNZI is globally recognised
as a “Tier 1” quality brand, having been an innovator and pioneer of global minutes trading for over 25 years. The TNZI
organisation is a member of many exclusive global infrastructure organisations and committees, including the ITW
Global Leaders Forum (GLF), Pacific Islands Telecommunications Association (PITA), the i3 Forum standards organisation
and the Pacific Telecommunications Council (PTC).

This has been the second full year of ownership of the TNZI business, making the year-on-year comparatives more
meaningful. The integration of the TNZI business is largely completed. Staff integration, staff resource expansion,
Wellington office relocation, IT systems separation, customer novations, and US licensing & transaction are now all
complete.

The global network expansion and upgrade program is also well underway. The expansion of the UK (London) Point of
Presence (PoP) and the US (Los Angeles) PoP upgrades were completed last financial year. After some logistics delays the
Hong Kong PoP is now fully operational and carrying live customer traffic. Additionally, the NZ (Auckland) and Singapore
PoPs are due to be upgraded and expanded in FY18.

In addition to the traditional TNZI product suite, the Symbio products are being productised and made available to the
TNZI global customer base. This is expected to provide additional high margin recurring revenue streams to the TNZI
business, similar to what Symbio is achieving in the Australian and New Zealand domestic markets.

The international wholesale network is currently hosting over 220 service provider customers, most of which are major
global Tier 1 service providers. Due to the cost and complexity of managing a global customer base, the focus for TNZI is
large service providers with significant positive margin contribution, so smaller non-performing customers are regularly
disconnected to save network and operational resources. The Group is investing in additional global marketing of the
TNZI brand, and is deploying additional Business Development resources in the UK, USA and New Zealand in order to
capture an increase in market share for both traditional and next generation products.

Significant changes in the state of affairs

There were no significant changes in the state of affairs of the company during the financial year.

After balance date events

Dividends proposed:

The dividend as recommended by the Board will be paid subsequent to the balance date.

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MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

Future developments

The Board is committed to growing the company organically as well as by way of targeted acquisitions.

The company has a strict policy around the evaluation of acquisition targets and will continue to look to build through
leveraging synergies, adding products and services through the acquisition of intellectual property and avoiding
companies that are pure re-sellers of other networks.

Environmental issues:

The Group’s operations are not regulated by any significant environmental regulation under a law of the Commonwealth
or of a State or Territory.

Dividends paid or recommended

Fully franked dividends paid or declared for payment during the financial year are as follows:

$000

Franking

Dividends paid during the year:

2016 Final dividend of 3.50 cents per share paid on 29 September 2016

2017 Interim dividend of 3.75 cents per share paid on 30 March 2017

2,372

2,727

Dividends recommended (subsequent to year end):

2017 Final dividend of 4.50 cents per share recommended on 15 August 2017

3,275

100%

The 2017 final dividend is to be paid on 28 September 2017 to shareholders registered as at 4 September 2017.

Options

Shares under option or issued on exercise of options

The Directors did not acquire any shares through the exercise of options during the year.

On 25 October 2016 at the Annual General Meeting, shareholders voted in favour of granting 450,000 options to
Directors. The details of those options are detailed in the table below:

Director

Date of expiry

Exercise price

Number of options

Terry Cuthbertson

Michael Boorne

Andy Fung

Rene Sugo

30 June 2021

$7.15

100,000

150,000

450,000

At the date of this report, the unissued ordinary shares of MNF Group Limited under options which were granted during
the 2017 financial year is as follows:

Grant date

Date of expiry

Exercise price

Number of options

15 September 2016

27 October 2016

30 June 2018

30 June 2019

30 June 2020

30 June 2021

Nil

$7.15

90,000

620,000

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

Remuneration Report Audited

Remuneration report overview

The Directors of MNF Group Limited present the Remuneration Report for the company and its controlled entities for
the year ended 30 June 2017. This report forms part of the Directors’ Report in accordance with section 300A of the
Corporations Act 2001 (the Act) and has been audited as required by section 308 (3C) of the Act. The Report details the
remuneration arrangements for MNF Group’s key management personnel (KMP):

Non-executive Directors (NEDs)
Executives

For the purposes of this report, the term “executive” includes the Chief Executive Officer (CEO), executive directors and
other senior executives of the company or the Group. Key management personnel are defined as those persons having
authority and responsibility for planning, directing and controlling the major activities of the company and the Group,
directly or indirectly, including any Director (whether executive or otherwise) of the Parent.

The table below outlines the KMP of the Group and their movements during FY17:

Name

Position

Term as KMP

Non-executive directors

Terry Cuthbertson

Non-executive Chairman

Full financial year

Michael Boorne

Non-executive Director

Full financial year

Andy Fung

Executive director

Rene Sugo

Other KMPs

Matthew Gepp

Catherine Ly

Non-executive Director

Full financial year

Chief Executive Officer

Full financial year

Chief Financial Officer

Full financial year

Company Secretary and Treasurer

Full financial year

There were no changes to KMP between the reporting date and date the financial report was authorised for issue.

Overview of executive remuneration

Remuneration Committee

Due to the size of the company the functions of the Remuneration Committee are undertaken by a full Board. Mr Boorne
chairs the Remuneration Committee.

The Board approves the remuneration arrangements of the CEO and other executives and all awards made under short
and long term incentive plans.

The Board also sets the aggregate remuneration of non-executive directors, which is then subject to shareholder
approval.

Use of remuneration consultants

The company does not currently engage remuneration consultants. The Board may consider the use of remuneration
consultants in the future as the company continues to grow.

Remuneration report approval at the 2016 AGM

The 2016 remuneration report received positive shareholder support at the 2016 AGM with a vote of 98.45% in favour
(2015: 97.97%).

www.mnfgroup.limited

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

Remuneration Report (continued)

Executive remuneration arrangements

Remuneration principles and strategy

Remunerations levels for key management personnel of the Group are designed to attract and retain appropriately
qualified and experienced directors and executives. MNF Group aims to reward executives based on their position
and responsibility whilst maintaining comparability with other companies in the sector of similar revenue, market
capitalisation and earnings levels. The executive remuneration includes a mix of the following components:

•
•
•

Fixed remuneration
Short-term performance incentives (STI)
Long term incentives (LTI)

Fixed remuneration

Fixed remuneration consists of base salary, employer superannuation contributions and non-monetary benefits. Non-
monetary benefits are typically benefits such as access to a car-parking spot and annual leave entitlements.

Details of short term incentive (STI) plans

The objective of the STI plan is to link MNF Group’s financial and operational targets with the remuneration received
by senior managers. As part of their respective employment agreements the CEO, CFO and other senior managers are
eligible for a cash bonus subject to the attainment of these clearly defined objectives.

100% of the STI target for FY17 was based on meeting agreed net profit after tax targets as set by the board.

STI amounts paid in FY17 are in relation to the FY16 company performance and targets.

Non-executive directors are not eligible for an STI.

Details of long term incentives (LTI) plans

The Board may issue options to executive and other employees under the company Employee Option Plan in order to
align remuneration with the creation of shareholder value over the long term. As such, LTI awards are only made to
executives and other key employees who have an impact on the Group’s performance.

Shareholders returns

The following table sets out MNF Group’s earnings and movements in shareholder wealth over the past five years:

Revenue (‘000)

NPAT (‘000)

Basic EPS (cents)

Dividends paid (‘000)

Dividends per share (cents)

Share price (as at 30 June)

Change in share price

2017

2016

2015

2014

2013

$191,752

$161,217

$85,675

$59,306

$46,209

$12,066

$8,990

17.32

$5,099

8.25

$4.37

$0.37

13.45

$4,512

7.00

$4.00

$0.18

$7,184

11.49

$3,128

5.75

$3.82

$1.40

$5,778

9.26

$2,498

4.50

$2.42

$1.22

$4,141

6.98

$1,770

3.50

$1.20

$0.64

$74M

Market capitalisation

$318m

$270M

$240M

$151M

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

Remuneration Report (continued)

Remuneration details of key management personnel for the year ended 30 June 2017

Details of the nature and amount of benefits and payments for each director and KMP of the Company for the 2016 and
2017 financial years are as follows:

Short term benefits

Post employment
benefits

Share based
payments

Total

Cash salary

STI/Bonus

Non-Monetary

Superannuation

Options

& fees

Benefits(i)

Non-executive directors:

Mr T Cuthbertson

2017

118,200

Mr M Boorne

Mr A Fung

Executive director:

Mr R Sugo

Other KMP:

Mr M Gepp

Ms C Ly

2016

2017

2016

2017

2016

2017

2016

2017

2016

2017

2016

109,000

91,750

83,000

77,000

71,000

464,617

79,500

410,779

43,900

296,667

80,000

246,667

57,500

159,250

154,250

Total

2017

1,207,484

159,500

2016

1,074,696

101,400

2,494

2,565

2,494

2,565

4,988

5,130

11,229

10,355

8,550

7,885

7,315

6,745

27,736

43,195

30,308

28,896

15,128

14,654

715

130,144

119,355

101,015

90,885

85,030

77,745

1,073

575,420

500,439

8,658

2,218

418,127

335,628

176,596

168,904

100,266

14,094

1,486,332

111,730

1,292,956

(i) The category “Non-Monetary benefits” represents other benefits such as car parking.

Key terms of employment agreements

The company has entered into an Executive Employment Agreement with Rene Sugo. The remuneration and terms of
employment for other Key Executives are also set out in written agreements. Each of these employment agreements
are unlimited in term but may be terminated by written notice by either party and by the company making payment in
lieu of notice.

Each of these agreements sets out the arrangements for total fixed remuneration, performance-related cash bonus
opportunities, superannuation, termination rights and obligations and eligibility to participate in the employee equity-
based incentive scheme. Executive salaries are reviewed annually. The executive employment agreements do not require
the company to increase base salary, incentive bonuses or to continue the participants’ participation in equity-based
incentive programs.

www.mnfgroup.limited

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

Remuneration Report (continued)

The Company may terminate the employment of the Key Executives without notice and without payment in lieu of
notice in some circumstances. This includes if the executive:

commits an act of serious misconduct;
commits a material breach of the executive employment agreement;

1.
2.
3. denigrates or engages in any behaviour that may materially damage the reputation of, or otherwise bring the
Company into disrepute; or is convicted of any criminal offence which would in the reasonable opinion of the Board
of Directors adversely affect the carrying out of the executive’s duties.

The Company may terminate the employment of the Key Executive at any time by giving the executive notice of
termination or payment in lieu of such notice. The amount of notice required from the Company in these circumstances
is set out in the following table:

Name of key executive

Company notice period

Employee notice period

Termination provision

Rene Sugo

Matthew Gepp

Catherine Ly

6 months

3 months

6 months

1 month

3 months

1 month

6 months base salary

3 months base salary

6 months base salary

Directors’ interests in shares and options of the company or related bodies corporate

At the date of this Report, the particulars of shares and options held by the directors of the company in the company or
in related bodies corporate which are required to be declared in the register of directors’ share holdings are as follows:

Name of Director

Mr Terry Cuthbertson

Mr Michael Boorne

Mr Andy Fung

Mr Rene Sugo

Total

Share holding

920,906

728,014

14,025,989

13,178,084

28,852,993

This concludes the remuneration report, which has been audited.

Options

100,000

150,000

450,000

MNF Group Limited | ABN 37 118 699 853 and controlled entities

Directors’ Report for the year ended 30 June 2017

Directors’ benefits

No director has received or has become entitled to receive, during or since the financial year, a benefit because of a
contract made by the company, controlled entity or related body corporate with a director, a firm which a director is a
member or an entity in which a director has a substantial financial interest.

Indemnifying officers or auditor

The Group has in place a contract insuring the directors, the company secretary and all executive officers of the Group
and any related body corporate, against a liability incurred by a director, company secretary or executive officers to the
extent permitted by the Corporations Act 2001.

The Group has indemnified the directors, the company secretary and all executive officers of the Group for costs incurred,
in their capacity as officers of the Group, for which they may be held personally liable, except where there is a lack of
good faith.

Details of the amount of the premium paid in respect of the insurance policies are not disclosed as such disclosure is
prohibited under the terms of the contract.

No indemnities have been given or agreed to be given or insurance premiums paid or agreed to be paid, during or since
the end of the financial year, to the auditors of the Group or any related entities against a liability incurred by the
auditors.

Proceedings on behalf of the company

No person has applied for leave of a Court to bring proceedings on behalf of the Group or intervene in any proceedings
to which the Group is a party for the purpose of taking responsibility on behalf of the Group for all or any part of those
proceedings. The Group was not a party to any such proceedings during the year.

Non-audit services

During the current and prior year MNSA Pty Ltd Chartered Accountants, the Group’s auditor did not provide any non-
audit services.

The total amount received by MNSA Pty Ltd Chartered Accountants for non-audit services was $Nil (2016: $Nil).

Auditor’s independence declaration

A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 has been
received and can be found on page 67 of the financial report.

Rounding off

MNF Group Limited is a company of the kind referred to in ASIC Legislative Instrument (Rounding in Financial/Directors’
Reports) 2016/191 and in accordance with that Instrument, amounts in the Directors’ Report and the Financial Report
are rounded to the nearest thousand dollars, except where otherwise indicated.

This Directors’ Report, incorporating the remuneration report, is signed in accordance with a resolution of the Board of
Directors.

Terry Cuthbertson
Chairman

Sydney, 15 August 2017

Rene Sugo
Director

www.mnfgroup.limited

Financial
Statements
2017

MNF Group Limited

Consolidated statement of profit or loss and other comprehensive income

For the year ended 30 June

Continuing operations
Revenue

Cost of sales
Gross profit

Finance revenue

Employee benefits expense

Depreciation and amortisation

Other expenses

Costs related to acquisition

Financing costs
Profit before income tax

Income tax expense

Profit from continuing operations

Net profit for the year

Other comprehensive income:

Items that may be reclassified to profit or loss:

Exchange differences on translation of foreign operations

Changes in fair value of cash flow hedges

Notes

Consolidated group

2017

$000

2016

$000

191,752

(133,139)
58,613

161,217

(112,576)
48,641

1,350

249

(26,028)

(5,083)

(10,054)

(498)

(1,790)
16,510

(21,223)

(4,709)

(9,872)

(200)

(1,061)
11,825

(4,444)

(2,835)

12,066

(584)

142
(442)

8,990

(484)

(582)
(1,066)

Total comprehensive income for the year

11,624

7,924

Earnings per share from continuing operations

Basic earnings per share (cents)

- Diluted earnings per share (cents)

17.32

17.10

13.45

13.38

The accompanying notes form part of these consolidated financial statements

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MNF Group Limited

Consolidated statement of financial position

As at:

Assets

Current assets

Cash and cash equivalents

Trade and other receivables

Income tax receivable

Inventories
Total current assets

Non-current assets

Property, plant and equipment

Deferred tax asset

Goodwill and other intangibles
Total non-current assets

Total assets

Liabilities

Current liabilities

Trade and other payables

Loans and borrowings

Deferred revenue

Income tax payable

Financial Instruments

Provisions
Total current liabilities

Non-current liabilities

Loans and borrowings

Financial instruments

Provisions

Deferred tax liability
Total non-current liabilities
Total liabilities

Net assets

Equity

Issued capital

Reserves

Retained earnings
Total equity

Consolidated group

30 June 2017

30 June 2016

Notes

$000

14a

52,358

30,121

669
83,148

18,663

958

47,697
67,318

150,466

63,181

2,500

1,611

1,581

592

1,483
70,948

8,690

140

921

1,420
11,171

82,119

68,347

49,000

270

19,077
68,347

52,889

29,067

195

305
82,456

12,011

735

30,802
43,548

126,004

66,550

2,500

1,668

2,812

1,300
74,830

11,190

282

734

-
12,206

87,036

38,968

26,440

419

12,109
38,968

The accompanying notes form part of these consolidated financial statements

MNF Group Limited

Consolidated statement of cash flows

Consolidated group

For the year ended 30 June

2017

Notes

$000

Cash flows from operating activities

Receipts from customers

Payments to suppliers and employees

Receipt on supplier novation

Settlement of financial liability

Interest received

Interest paid

Income tax paid
Net cash from operating activities

Cash flows from investing activities

Purchase of property, plant and equipment

Decrease in other financial assets

(Payment)/receipt for business acquisitions

Software development costs
Net cash (used in) investing activities

Cash flows from financing activities

Proceeds from share placement and options exercised

Dividends paid

Repayment of borrowings

Repayment of finance lease liability
Net Cash from financing activities

Net increase in cash and cash equivalents

Impact of foreign currency on cash and cash equivalents

Cash and cash equivalents at 1 July
Cash and cash equivalents at 30 June

202,372

(182,486)

(3,947)

1,358

(904)

(3,016)
13,377

(9,646)

(16,986)

(461)
(27,093)

22,560

(5,099)

(2,500)

-
14,961

1,245

(1,776)

52,889
52,358

2016

$000

173,115

(157,611)

41,464

144

(873)

(4,415)
51,824

(5,958)

323

182

(150)
(5,603)

16,508

(4,511)

(11,600)

(16)
381

46,602

6,287
52,889

The accompanying notes form part of these consolidated financial statements

www.mnfgroup.limited

MNF Group Limited

Consolidated statement of changes in equity

Attributable to owners of the company

For the year ended
30 June 2017

Ordinary
share
capital

Share-
based
payment
reserve

Trans-
lation
reserve

Hedging
reserve

Retained
earnings

Total

$000

Balance at 30 June 2015

9,932

1,353

155

(23)

7,631

19,048

Profit for the period

Other comprehensive income

Dividends paid

Share options exercised

Share placement

Share issued - DRP

1,607

14,449

452

(484)

(582)

8,990

(4,512)

8,990

(1,066)

(4,512)

1,607

14,449

452

Balance at 30 June 2016

26,440

1,353

(329)

(605)

12,109

38,968

Profit for the period

Other comprehensive income

Dividends paid

Share options exercised

Share placement

Shares issued - DRP

Shares issued - SPP

Share based payment transactions

958

17,949

703

2,950

293

(584)

142

12,066

(442)

(5,098)

958

17,949

703

2,950

293

Balance at 30 June 2017

49,000

1,646

(913)

(463)

19,077

68,347

The accompanying notes form part of these consolidated financial statements

Notes to the
Consolidated
Financial
Statements

MNF Group Limited

Notes to the consolidated financial statements

Table of contents

1. Corporate information ........................................................................................................................ 39

2. Significant accounting policies ........................................................................................................... 39

3. Segment note ....................................................................................................................................... 47

4. Revenue and expenses ....................................................................................................................... 48

Income tax ........................................................................................................................................... 49

6. Statement of cash flows reconciliation ............................................................................................ 50

7. Trade and other receivables .............................................................................................................. 50

8. Property, plant and equipment ......................................................................................................... 51

9. Trade and other payables ................................................................................................................... 52

10. Loans and borrowings ......................................................................................................................... 52

11. Financial instruments ............................................................................................................................53

12. Deferred revenue .................................................................................................................................. 54

13. Provisions .............................................................................................................................................. 54

14. Issued capital ...................................................................................................................................... 55

15. Share based payments ....................................................................................................................... 56

16. Commitments and contingencies ..................................................................................................... 57

17. Events after reporting date ................................................................................................................ 57

18. Auditors remuneration ...................................................................................................................... 57

19. Director and executive disclosures ...................................................................................................... 58

20. Controlled entities .............................................................................................................................. 59

21. Goodwill and other intangibles .......................................................................................................... 60

22. Impairment testing ............................................................................................................................. 61

23. Business combinations ...................................................................................................................... 62

24. Earnings per share .............................................................................................................................. 63

25. Dividends paid and proposed ............................................................................................................ 63

26. Parent entity ........................................................................................................................................ 64

27. Financial risk management objectives and policies ......................................................................... 64

28. Company details ................................................................................................................................. 65

MNF Group Limited

Notes to the consolidated financial statements

1. Corporate information

These consolidated financial statements and notes represent those of MNF Group Limited and controlled entities (the
“company” or the “group”) for the year ended 30 June 2017.

MNF Group Limited is a for profit entity limited by shares and incorporated and domiciled in Australia whose shares are
publicly traded on the Australian Securities Exchange (ASX) and is the ultimate parent entity in the Group.

The separate financial statements of the parent entity, MNF Group Limited, have not been presented within this financial
report as permitted by the Corporations Act 2001.

The financial statements were authorised for issue on 15 August 2017 by the directors of the company.

The nature of the operations and principal activities of the Group are described in the Directors’ Report.

2. Significant accounting policies

a. Basis of preparation

The financial statements are general purpose financial statements that have been prepared in accordance with Australian
Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian
Accounting Standards Board (AASB) and the Corporations Act 2001.

Australian Accounting Standards set out accounting policies that the AASB has concluded would result in the financial
statements containing relevant and reliable information about transactions, events and conditions. Compliance with
Australian Accounting Standards ensures that the financial statements and notes also comply with International
Financial Reporting Standards as issued by the International Accounting Standards Board (IASB). Material accounting
policies adopted in the preparation of these financial statements are presented below and have been consistently
applied unless otherwise stated.

The financial statements have been prepared on an accruals basis and are based on historical costs, modified, where
applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.

b. New and amended accounting policies adopted by the Group and New Accounting Standards for application in
future periods

Accounting Standards and Interpretations issued by the AASB that are not yet mandatorily applicable to the Group,
together with an assessment of the potential impact of such pronouncements on the Group when adopted in future
periods, are discussed below:

AASB 9: Financial Instruments and associated Amending Standards (applicable to annual reporting periods beginning on
or after 1 January 2018).

The Standard will be applicable retrospectively (subject to the provisions on hedge accounting outlined below) and
includes revised requirements for the classification and measurement of financial instruments, revised recognition and
derecognition requirements for financial instruments and simplified requirements for hedge accounting.

The key changes that may affect the Group on initial application include certain simplifications to the classification
of financial assets, simplifications to the accounting of embedded derivatives, upfront accounting for expected credit
loss and the irrevocable election to recognise gains and losses on investments in equity instruments that are not held
for trading in other comprehensive income. AASB 9 also introduces a new model for hedge accounting that will allow
greater flexibility in the ability to hedge risk, particularly with respect to hedges of non-financial items. Should the entity
elect to change its hedge policies in line with the new hedge accounting requirements of the Standard, the application of
such accounting would be largely prospective.

Although the directors anticipate that the adoption of AASB 9 may have an impact on the Group’s financial instruments,
including hedging activity, it is impracticable at this stage to provide a reasonable estimate of such impact.

AASB 15: Revenue from Contracts with Customers (applicable to annual reporting periods commencing on or after 1
January 2017).

When effective, this Standard will replace the current accounting requirements applicable to revenue with a single,
principles-based model. Except for a limited number of exceptions, including leases, the new revenue model in AASB
15 will apply to all contracts with customers as well as non-monetary exchanges between entities in the same line of
business to facilitate sales to customers and potential customers.

The core principle of the Standard is that an entity will recognise revenue to depict the transfer of promised goods or
services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange

www.mnfgroup.limited

MNF Group Limited

Notes to the consolidated financial statements

for the goods or services. To achieve this objective, AASB 15 provides the following five-step process:

•

identify the contract(s) with a customer;

identify the performance obligations in the contract(s);

determine the transaction price;

allocate the transaction price to the performance obligations in the contract(s); and

recognise revenue when (or as) the performance obligations are satisfied.

This Standard will require retrospective restatement, as well as enhanced disclosures regarding revenue.

Although the directors anticipate that the adoption of AASB 15 may have an impact on the Group’s financial statements,
it is not expected to generate material differences to the current or future years results.

AASB 16: Leases (applicable to annual reporting periods commencing on or after 1 January 2019). When effective, this
Standard will:

•

replace AASB 117 Leases and some lease-related Interpretations;

require all leases to be accounted for ‘on-balance sheet’ by lessees, other than short-term and low value asset
leases; and

•

require new and difference disclosures about leases.

This Standard will require retrospective restatement, as well as new and difference disclosures. Although the directors
anticipate the adoption of AASB 16 may have an impact on the Group’s financial statements, it is impracticable at this
stage to provide a reasonable estimate of such impact.

c. Principles of consolidation

The consolidated financial statements incorporate the assets, liabilities and results of entities controlled by MNF Group
Limited at the end of the reporting period. A controlled entity is any entity over which MNF Group Limited has the ability
and right to govern the financial and operating policies so as to obtain benefits from the entity’s activities. Control will
generally exist when the parent owns, directly or indirectly through subsidiaries, more than half of the voting power of
an entity. In assessing the power to govern, the existence and effect of holdings of actual and potential voting rights are
also considered.

In preparing the consolidated financial statements, all inter-group balances and transactions between entities in the
consolidated group have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where
necessary to ensure consistency with those adopted by the parent entity.

Where controlled entities have entered or left the Group during the year, the financial performance of those entities are
included only for the period of the year that they were controlled. A list of controlled entities is contained in Note 20 to
the financial statements.

d. Business combinations

Business combinations occur where an acquirer obtains control over one or more businesses and results in the
consolidation of its assets and liabilities. All business combinations, including those involving entities under common
control, are accounted for by applying the acquisition method.

Consideration transferred for the acquisition comprises the fair value of the assets transferred, liability incurred and the
equity interests issued by the acquirer. Identifiable assets acquired and liabilities and contingent liabilities assumed in
a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. Any
deferred consideration payable is discounted to present value using the entity’s incremental borrowing rate. Acquisition
related costs are expensed as incurred.

Goodwill is stated after separate recognition of identifiable intangible assets. It is calculated as the excess of the sum of
fair value of consideration transferred, over the acquisition-date fair values of identifiable net assets.

e. Critical accounting estimates and judgments

The directors evaluate estimates and judgments incorporated into the financial statements based on historical
knowledge and best available current information. Estimates assure a reasonable expectation of future events and are
based on current trends and economic data, obtained both externally and within the Group. Key estimates that have a
significant risk of causing adjustments to the carrying amounts of certain assets and liabilities within the next annual

MNF Group Limited

Notes to the consolidated financial statements

reporting period are:

(i) Share based payment transactions

The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by an independent valuer using a Black-
Scholes model. The accounting estimates and assumptions relating to equity-based payments would have no impact on
the carrying amounts of assets and liabilities within the next annual reporting period but may have impact on profit or
loss and equity.

(ii) Useful lives of property, plant and equipment

The Group reviews the estimated useful lives of property, plant and equipment at the end of each financial year. The
Group adjusts the remaining effective useful life of its assets to better reflect their actual usage and future economic
benefit.

(iii) Utilisation of tax losses

The company and its wholly-owned Australian subsidiaries elected to join as members of a tax consolidated group under
Australian taxation law as of 1 July 2011. Each entity in the tax consolidated group contributed tax losses to the Group.
The Group has no tax losses to currently utilize.

(iv) Research & Development (R&D) tax concession

When calculating the income tax provision for the year, there is an operating assumption that the Research &
Development tax concession for 2017 will be materially the same as for 2016. The directors believe the estimate is
reasonable and conservative. This may be subject to change following the approval of the R&D tax concession application
from AusIndustry in due course.

f. Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable after taking into account any trade
discounts and volume rebates allowed. The following specific recognition criteria must also be met before revenue is
recognised:

(i) Rendering of services

Revenue from telecommunication services is recognised when the services are provided to the customer.

Deferred revenue represents the unused proportion of cash received in advance for call credits determined on a specific
account basis at balance date.

(ii) Interest income / Finance revenue

Interest revenue is recognised using the effective interest rate method, which, for floating rate financial assets, is the
rate inherent in the instrument.

g. Leases

Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as
expenses in the period in which they are incurred.

Lease incentives under operating leases are recognised as a liability and amortised on a straight-line basis over the life
of the lease term.

h. Cash and cash equivalents

Cash and cash equivalents in the statement of financial position comprise cash at bank and in hand and short-term
deposits with an original maturity of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes in value.

For the purposes of the Statement of Cash Flows, cash and cash equivalents consist of cash and cash equivalents as
defined above, net of outstanding bank overdrafts.

i. Trade and other receivables

Trade receivables and other receivables, which generally have 30-90 day terms, are recognised and carried at original
invoice amount less an allowance for any amounts determined to be un-collectable or amounts subject to dispute.

An allowance for doubtful debts is made when there is objective evidence that the Group will not be able to collect the

www.mnfgroup.limited

MNF Group Limited

Notes to the consolidated financial statements

debts. Bad debts are written off when it is determined there is no chance of recovering the debt.

An allowance for credit notes is made when invoiced amounts are subject to dispute and there is objective evidence that
the dispute will be successful.

j. Foreign currency transactions and balances

(i) Functional and presentation currency

The functional currency of each group entity is measured using the currency of the primary consolidated environment in
which the entity operates. The consolidated financial statements are presented in Australian dollars which is the parent
entity’s functional and presentation currency.

(ii) Transactions and balances

Transactions in foreign currencies are initially recorded in the functional currency by applying the exchange rates ruling
at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the
rate of exchange ruling at the balance sheet date.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the
exchange rate as at the date of the initial transaction. Non-monetary items measured at fair value in a foreign currency
are translated using the exchange rates at the date when the fair value was determined.

(iii) Group Companies

The financial results and position of foreign operations whose functional currency is different from the group’s
presentation currency are translated as follows:

- Assets and liabilities are translated at year end exchange rates prevailing at the reporting date.

- Income and expenses are translated at average exchange rates for the period.

- Retained earnings are translated at the exchange rates prevailing at the date of the transaction.

On consolidation, assets and liabilities have been translated into Australian dollars at the closing rate at the reporting
date. Income and expenses have been translated into the Group’s presentation currency at the average rate over the
reporting period. The exchange differences are taken to other comprehensive income (OCI) in the consolidated financial
report.

k. Income tax

The income tax expense (income) for the year comprises current income tax expense (income) and deferred tax expense
(income).

Current income tax expense charged to the profit or loss is the tax payable on taxable income. Current tax liabilities
(assets) are measured at the amounts expected to be paid to (recovered from) the relevant taxation authority.

Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the year
as well as unused tax losses if any.

Current and deferred income tax expense (credit) is charged or credited outside profit or loss when the tax relates to
items that are recognised outside profit or loss.

Except for business combinations, no deferred income tax is recognised from the initial recognition of an asset or liability
where there is no effect on accounting or taxable profit or loss.

Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the asset
is realised or the liability is settled and their measurement also reflects the manner in which management expects to
recover or settle the carrying amount of the related asset or liability.

Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is
probable that future taxable profit will be available against which the benefits of the deferred tax asset can be utilised.

Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint ventures,
deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary difference can be
controlled and it is not probable that the reversal will occur in the foreseeable future.

Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that

MNF Group Limited

Notes to the consolidated financial statements

net settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax
assets and liabilities are offset where: (a) a legally enforceable right of set-off exists; and (b) the deferred tax assets and
liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different
taxable entities where it is intended that net settlement or simultaneous realisation and settlement of the respective
asset and liability will occur in future periods in which significant amounts of deferred tax assets or liabilities are expected
to be recovered or settled.

Tax consolidation:

MNF Group Limited and its wholly-owned Australian subsidiaries are part of a tax consolidation group under Australian
taxation law. MNF Group Limited is the head entity in the tax consolidation group. Tax expense, deferred tax liabilities
and deferred tax assets arise from temporary differences of the members of the tax-consolidation group using the
‘separate taxpayer within group’ approach by reference to the carrying amounts in the separate financial statements of
each entity and the tax values applying under tax consolidation.

MNF Group Limited, as the head entity in the tax consolidated group, recognises the current tax liabilities and assets and
deferred tax assets arising from unused tax losses and tax credits of all entities in the Australia group.

l. Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is
not recoverable from the Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of
the asset or as part of an item of the expense. Receivables and payables in the statement of financial position are shown
inclusive of GST.

Cash flows are presented in the statement of cash flows on a gross basis, except for the GST component of investing and
financing activities, which are disclosed as operating cash flows.

m. Inventories

Inventories are measured and recorded at cost and are valued at the lower of cost and net realisable value.

n. Property, plant and equipment

Plant and equipment are measured on the cost basis.

The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the
recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows
that will be received from the asset’s employment and subsequent disposal. The expected net cash flows have been
discounted to their present values in determining recoverable amounts.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when
it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can
be measured reliably. All other repairs and maintenance are charged to the statement of comprehensive income during
the financial period in which they are incurred.

Depreciation

The depreciable amount of all fixed assets is depreciated on a straight-line basis over the asset’s useful life to the
consolidated group commencing from the time the asset is held ready for use.

The depreciation rates used for each class of depreciable assets are:

Funiture & Fittings
Office Equipment
Leasehold improvements
Network Infrastructure and IT Systems

Group
6 to 10 years
3 to 5 years
3 to 9 years
2 to 10 years

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is
greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses
are included in the statement of comprehensive income. When re-valued assets are sold, amounts included in the
revaluation surplus relating to that asset are transferred to retained earnings.

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MNF Group Limited

Notes to the consolidated financial statements

o. Financial instruments

Non-derivative financial assets and financial liabilities are recognised when the entity becomes a party to the contractual
provisions to the instrument. For financial assets, this is equivalent to the date that the company commits itself to
either the purchase or sale of the asset (i.e. trade date accounting is adopted).

Financial instruments are initially measured at fair value plus transaction costs, except where the instrument is classified
‘at fair value through profit or loss’, in which case transaction costs are expensed to profit or loss immediately.

(i) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an
active market and are subsequently measured at amortised cost.

Loans and receivables are included in current assets, except for those which are not expected to mature within 12 months
after the end of the reporting period. (All other loans and receivables are classified as non-current assets.)

(ii) Investments in subsidiaries held by the parent

Investments in subsidiaries held by the parent entity are recognised and subsequently measured at cost in the separate
financial statements of the company, less any impairment.

(iii) Derivative financial instruments and hedge accounting

The group holds derivative financial instruments to hedge its foreign currency and interest rate risk exposures. Embedded
derivatives are separated from the host contract and accounted for separately if certain criteria are met.

If the hedging instrument no longer meets the criteria for hedge accounting, expires or is sold, terminated or exercised,
or the designation is revoked, then the hedge accounting is discontinued prospectively. If the forecast transaction is no
longer expected to occur, then the amount accumulated in reserves is reclassified to profit or loss.

Derivatives are initially recognised at fair value; any directly attributable transaction costs are recognised in profit or loss
as incurred.

Cash flow hedges

When a derivative is designated as a cash flow hedging instrument, the effective portion of changes in the fair value of the
derivative is recognised in other comprehensive income (OCI) and accumulated in the hedging reserve. Any ineffective
portion of changes in the fair value of the derivative is recognised immediately in profit or loss.

The amount accumulated in equity is retained in OCI and reclassified to profit or loss in the same period or periods during
which the hedged item affects profit or loss.

Fair Value hedges

When a derivative is designated as a fair value hedging instrument, the hedged item is re-measured to take into account
the gain or loss attributable to the hedged risk, with the gains or losses arising recognised in profit or loss. This offsets
the gain or loss arising on the hedging instrument which is measured at fair value through profit or loss. Changes in fair
value of the derivative instrument are recognised in profit or loss.

p. Intangible assets and goodwill (impairment testing)

At the end of each reporting period, the Group assesses whether there is any indication that an asset may be impaired.
The assessment will include the consideration of external and internal sources of information including dividends
received from subsidiaries, associates or jointly controlled entities deemed to be out of pre-acquisition profits. If such an
indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of the asset, being
the higher of the asset’s fair value less costs to sell and value in use, to the asset’s carrying value. Any excess of the asset’s
carrying value over its recoverable amount is expensed to the statement of comprehensive income.

Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable
amount of the cash-generating unit to which the asset belongs.

MNF Group Limited

Notes to the consolidated financial statements

Recognition and measurement:

Goodwill

Brands

Research and
development

Goodwill arising on the acquisition of subsidiaries is measured at cost less accumulated
impairment losses. Goodwill Assets are not subject to amortisation and are tested for
impairment on an annual basis, or whenever an indication of impairment exists.

Brands identified on acquisitions are measured and recorded at valuation less accumulated
impairment losses. Brands are not subject to amortisation and are tested for impairment on
an annual basis, or whenever an indication of impairment exists.

Expenditure on research is recognised in profit or loss as incurred.
Development expenditure is capitalised only if the expenditure can be measured reliably, the
product or process is technically and commercially feasible, future economic benefits are
probable and the Group intends to and has sufficient resources to complete development and
to use or sell the asset. Otherwise, it is recognised in profit or loss as incurred. Subsequent
to initial recognition, development expenditure is measured at cost less accumulated
amortisation and any accumulated impairment losses.

Other intangible
assets

Other intangible assets, including customer contracts, patents and trademarks and software
acquired by the Group that have finite lives are measured at cost less accumulated amortisation
and any accumulated impairment losses.

Amortisation

Amortisation is calculated to write off the cost of intangible assets less their residual values using the straight-line
method over their estimated useful life, and is generally recognised in profit or loss. Goodwill is not amortised.

The estimate useful life of intangibles is as follows:

•

Patents and trademarks 5 to 20 years

Software and Software development costs 5 to 10 years

Customer relationships 3 to 5 years

Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

q. Trade and other payables

Trade and other payables represent the liability outstanding at the end of the reporting period for goods and services
received by the Group during the reporting period which remains unpaid. The balance is recognised as a current liability
with the amount being normally paid within 30 days of recognition of the liability.

r. Provisions

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, for
which it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation
and a reliable estimate can be made of the amount of the obligation.

When the group expects some or all of a provision to be reimbursed, for example under an insurance contract, the
reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense
relating to any provision is presented in the Statement of Comprehensive Income net of any reimbursement.

Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the
present obligation at the Statement of Financial Position date. If the effect of the time value of money is material,
provisions are discounted using a current pre-tax rate that reflects the time value of money and the risks specific to the
liability.

s. Employee leave benefits

Provision is made for the Group’s liability for employee benefits arising from services rendered by employees to balance
date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected
to be paid when the liability is settled. Employee benefits payable later than one year have been measured at the present
value of the estimated future cash outflows to be made for those benefits. In determining the liability, consideration
is given to employee wages increases and the probability that the employee may satisfy vesting requirements. Those
cash outflows are discounted using market yields on national government bonds with terms to maturity that match the
expected timing of cash flows.

www.mnfgroup.limited

MNF Group Limited

Notes to the consolidated financial statements

t. Contributed capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from the proceeds.

u. Earnings per share

Basic earnings per share is determined as net profit/(loss) attributable to members of the group, adjusted to exclude any
costs of servicing equity (other than dividends), divided by the weighted average number of ordinary shares.

Diluted earnings per share include options outstanding that will have the potential to convert to ordinary shares and
dilute the basic earnings per share.

v. De-recognition of financial assets and financial liabilities

Financial assets are de-recognised where the contractual rights to receipt of cash flows expires or the asset is transferred
to another party whereby the entity no longer has any significant continuing involvement in the risks and benefits
associated with the asset. Financial liabilities are de-recognised where the related obligations are either discharged,
cancelled or expired. The difference between the carrying value of the financial liability extinguished or transferred to
another party and the fair value of consideration paid, including the transfer of non-cash assets or liabilities assumed,
is recognised in profit or loss.

w. Share-based payment transactions

The Group provides benefits to its employees and Directors (including key management personnel) in the form of
share-based payments, whereby employees render services in exchange for shares or rights over shares (equity-settled
transactions).

The cost of these equity-settled transactions with employees and Directors is measured by reference to the fair value of
the equity instruments at the date at which they are granted. The fair value is determined by an external valuer using a
Black-Scholes model.

The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period
in which the performance and/or service conditions are fulfilled (the vesting period), ending on the date on which the
relevant employees and Directors become fully entitled to the award (the vesting date).

At each subsequent reporting date until vesting, the cumulative charge to the consolidated statement of profit or loss
and other comprehensive income is the product of:

(i) the grant date fair value of the award;

(ii) the current best estimate of the number of awards that will vest, taking into account such factors as the likelihood of
employee turnover during the vesting period and the likelihood of non-market performance conditions being met; and

(iii) the expired portion of the vesting period.

The charge to the consolidated statement of profit or loss and other comprehensive income for the period is the
cumulative amount as calculated above less the amounts already charged in previous periods. There is a corresponding
credit to equity.

MNF Group Limited

Notes to the consolidated financial statements

3. Segment note

Operating Segments

The Group operates in three core segments.

Australian Domestic Retail

•

The core My Net Fone brand, services residential, SMB (small to medium business), Enterprise and Government
customers in Australia.
Conference Call International Pty Limited (CCI), is included in this segment.

•
• Other brands in this segment include, Connexus, callstream, PennyTel and theBuzz.
•

Key products in this segment include:
O VoIP, Data, Virtual PBX and SIP trunking
O Conferencing, toll free numbers and number porting

Australia/New Zealand Domestic Wholesale

•
•

The core Symbio and iBoss brands services wholesale customers based in Australia and New Zealand.
Key products in this segment include:
O Call termination, pre-select, SIP trunking, inbound numbers, virtual numbers and porting
O Wholesale aggregation, data enablement and MVNO

Global Wholesale

•
•
•

The TNZI Brand services the global wholesale market
TollShield and OCA (Open CA) also operate under the Global Wholesale segment
Key products include:
O Voice carriage and International toll free services (ITFS)
O Toll Fraud prevention
O Class 4 Softswitch and billing

The Group has identified its operating segments based on internal management reporting that is used by the executive
management team (chief operating decision makers) in assessing the performance and allocating resources.

The accounting policies used by the Group in reporting segment information internally, is the same as those contained
in note 2 to the financial statements.

Australia
Domestic Retail

Australia/New
Zealand Domestic
Wholesale

Global Wholesale

Total

$000

32,213

-
32,213

18,882

28,917

-
28,917

15,078

27,133

4,737
31,870

15,431

23,445

6,582
30,027

12,479

132,406

1,754
134,160

24,300

108,855

1,420
110,275

21,084

191,752

6,491
198,243

58,613

161,217

8,002
169,219

48,641

2017

External revenue

Inter-segment revenue
Segment revenue

Segment margin

2016

External revenue

Inter-segment revenue
Segment revenue

Segment margin

www.mnfgroup.limited

2017

$000

2016

$000

191,752

161,217

1,350

249

22,533

1,845

293

1,357
26,028

3,305

1,778
5,083

1,641

1,460

2,416

363

563

169

422

3,020
10,054

956

834
1,790

18,527

1,295

1,401
21,223

3,244

1,465
4,709

1,401

1,068

2,248

307

358

544

379

3,567
9,872

107

954
1,061

MNF Group Limited

Notes to the consolidated financial statements

For the year ended 30 June

4. Revenue and expenses

a. Revenue

Rendering of services

Finance revenue consists of:

Interest on bank deposits

b. Employee benefits expense

Wages and salaries

Superannuation

Shared based payments expense

Other employee benefits expense

c. Depreciation and amortisation

Depreciation of fixed assets

Amortisation of intangible assets

d. Other expenses

Marketing

Property

Technology and support

Distribution

Accounting and audit

Legal and consulting

Bank and transaction costs

Other administrative expenses

e. Financing costs

Finance charges related to hedge instrument

Finance charges payable on bank loan

MNF Group Limited

Notes to the consolidated financial statements

For the year ended 30 June

2017

$000

2016

$000

5. Income tax
a.

Income tax expense

The major components of income tax expense are as follows:

Current tax

Adjustment in respect of prior year tax

Origination and reversal of temporary differences
Total

4,716

(139)

(133)
4,444

2,951

(150)
2,835

b. Reconciliation between tax expense and the accounting profit

Profit before income tax

16,510

11,825

At the Group’s statutory rate of 30% (2016: 30%)

4,953

3,548

Tax incentives

Effect of tax rates in foreign jurisdictions

Non-temporary differences

Adjustment in respect of prior year
Total

Effective income tax rate

c. Deferred tax asset

Recognised in the accounts:

Relating to temporary differences

(247)

(68)

(28)

(166)
4,444

27%

958
958

The total value of temporary differences not brought to account in the current year is $Nil (2016: $118k)

d. Deferred tax liability

Recognised in the accounts:

Relating to temporary differences

1,420
1,420

(250)

(64)

(433)

34
2,835

24%

735
735

-
-

A deferred tax liability of $1.35m arose on acquisition of Conference Call International Pty Limited (note 23)

e. The Company and its wholly-owned Australian entities are members of a tax consolidated group. Transactions within
the Group have been eliminated in full on consolidation. The Australian tax consolidated Group is treated as a single
entity for income tax purposes.

www.mnfgroup.limited

MNF Group Limited

Notes to the consolidated financial statements

For the year ended 30 June

6. Statement of cash flows reconciliation
a. Cash and cash equivalents

2017

$000

2016

$000

Cash and cash equivalents balance comprises:

Cash at bank

52,358

52,889

b. Reconciliation of net profit after tax to net cash flows from operating activities:

Profit for the year

Adjustments for:

Depreciation and amortisation

Share based payments expense

Tax expense

Changes in assets and liabilities, net of the effects of acquisitions:

Change in trade and other receivables

Change in inventories

Change in trade and other payables

Change in other financial assets

Change in deferred revenue

Change in provisions and employee benefits
Cash generated from operating activities

12,066

8,990

5,083

293

4,444

(207)

(365)

(2,914)

(2,164)

(57)

214
16,393

4,709

2,835

625

(118)

39,166

(174)

206
56,239

Tax paid

(3,016)

(4,415)

Net cash flow from operating activities

13,377

51,824

7. Trade and other receivables

Trade receivables

Doubtful debts provision

Provision for credit notes

Other receivables

28,602

(1,008)

2,527
30,121

28,307

(1,001)

(300)

2,061
29,067

The majority of receivables are in the form of contracted agreements with customers. In general, the terms and
conditions of these contracts require settlement between 14 to 30 days from the date of invoice.

Estimating allowance for doubtful debts
We apply professional judgement to estimate the allowance for doubtful debts for our trade receivables. Our assessment
is based on historical trends and management’s assessment of general economic conditions. We consider credit risk,
insolvency risk and incapacity to pay a legally recoverable debt.

MNF Group Limited

Notes to the consolidated financial statements

8. Property, plant and equipment
a. Reconciliation of carrying amount

Office
furniture &
equipment

Leasehold
improve-
ments

Network
infrastructure
& equipment

Work in
progress

Total

$000

Consolidated
Cost:

At 1 July 2015
Acquisitions
Additions
Disposals
Transfers from work in progress
Reclassify asset category
Effect of movement in exchange rates
At 30 June 2016

At 1 July 2016
Acquisitions
Additions
Disposals
Transfers from work in progress
Reclassify asset category
Effect of movement in exchange rates
At 30 June 2017

Accumulated depreciation:

At 1 July 2015
Acquisitions
Depreciation expense
Disposals
Reclassify asset category
Effect of movement in exchange rates
At 30 June 2016

At 1 July 2016
Acquisitions
Depreciation expense
Disposals
Reclassify asset category
Effect of movement in exchange rate
At 30 June 2017

1,650

-
1,171
(389)
-
-
(9)
2,423

2,423

-
1,024
-
86
(329)
(8)
3,196

(1,183)

-
(316)
389
-
8
(1,102)

(1,102)

-
(447)
-
22
3
(1,524)

287

-
502
-
-
-
-
789

789

-
453
-
-
329
(12)
1,559

(89)

-
(465)
-
-
-
(554)

(554)

-
(295)
-
(22)
2
(869)

20,457

974
4,633
(3,327)
-
-
(617)
22,120

22,120

1,344
4,925
(3,008)
-
-
(505)
24,876

(13,325)

-
(2,463)
3,327
-
710
(11,751)

(11,751)

(1,043)
(2,563)
3,008
-
375
(11,974)

-
86
-
-
-
-
86

-
3,399
-
(86)
-
-
3,399

-
-
-
-
-
-

22,394

974
6,392
(3,716)
-
-
(626)
25,418

25,418

1,344
9,801
(3,008)
-
-
(525)
33,030

(14,597)

-
(3,244)
3,716
-
718
(13,407)

(13,407)

(1,043)
(3,305)
3,008
-
380
(14,367)

Net book value:

At 30 June 2016
At 30 June 2017

1,321
1,672

235
690

10,369
12,902

86
3,399

12,011
18,663

b. Disposals
Asset disposals relate to equipment that is fully written down to net book value $Nil and is no longer in use. There was
no impact to the profit or loss account in relation to these disposals.

www.mnfgroup.limited

MNF Group Limited

Notes to the consolidated financial statements

For the year ended 30 June

9. Trade and other payables

Trade payables

Other creditors and accruals

Security deposits held

10. Loans and borrowings

Current liabilities:

Secured bank loan

Non-current liabilities:

Secured bank loan

2017

$000

46,038

17,088

55
63,181

2016

$000

52,608

13,895

47
66,550

2,500

8,690

11,190

13,690

The Group’s bank facility (the “Facility”) consists of a $27,000,000 revolving acquisition facility and a $2,100,000 (2016:
$850,000) revolving multi-option credit facility. The Facility has a maturity date of 20 April 2020.

$1,510,000 of the revolving multi-option credit facility has been utilised to back bank guarantees relating to property
leases and supplier security.

The Facility is secured by a fixed and floating charge over the assets of the Group and is interest bearing.

During the year there were no defaults or breaches on the Facility.

MNF Group Limited

Notes to the consolidated financial statements

For the year ended 30 June

11. Financial instruments

Current liabilities:

Forward foreign exchange contract - fair value hedge

Non-current liabilities:

Interest rate swap contract - cash flow hedge

2017

$000

592

140

732

2016

$000

2,812

282

3,094

Interest rate swap contract - cash flow hedge

The Group’s bank facility is a variable interest rate facility. It is the Group’s policy to protect a portion of the bank facility
from exposure to fluctuations in interest rates. Accordingly on 23 April 2016 the Group entered into an interest rate swap
agreement to protect the loan facility from exposure to increasing interest rates. A hedge relationship was designated
on this date. Under this interest rate swap, the Group is obliged to receive interest at a variable rate and pay interest at
a fixed rate of 2.64% per annum. The swap covers 95.5% (2016: 87%) of the floating rate exposure under the Facility.

The contract requires settlement of the net interest receivable or payable each 90 days which coincides with the dates
on which interest is payable on the underlying facility making it highly effective.

The gain or loss from remeasuring the hedging instrument at fair value is recognised in other comprehensive income and
deferred in equity in the hedge reserve. It is reclassified into profit or loss when the hedged interest expense is recognised.

Forward foreign exchange contract - fair value hedge

There are significant creditor balances derived in foreign currencies, including Euro, Japanese Yen, Pound Sterling, and
U.S. Dollar. These exposures on creditor balances are largely offset by debtor balances in corresponding currencies.
Where this is not the case it is the Group’s policy to protect these liabilities from exposure to fluctuations in foreign
exchange rates. Accordingly, the Group has entered into a forward foreign exchange contract to protect the exposed
creditor balances from increasing foreign exchange rates. A hedge relationship has been designated. During the year
ended 30 June 2017 the Group recognised a $592k (2016: 2,368k) foreign exchange loss on the fair value hedge and a $577k
(2016: $2,102k) gain on the hedged items. There has been no material ineffectiveness on the fair value hedge relationship
during the year.

Foreign exchange hedge effectiveness

Foreign exchange movement

Foreign currency term deposits

Foreign currency liabilities
Gain in foreign currency valuations

Fair value of hedging contract
Loss in valuation of hedge

Hedge effectiveness

2017

$000

1,012

(435)
577

(592)
(592)

97%

2016

$000

1,969

133
2,102

(2,368)
(2,368)

89%

www.mnfgroup.limited

MNF Group Limited

Notes to the consolidated financial statements

For the year ended 30 June

12. Deferred revenue

Pre-paid accounts

2017

$000

2016

$000

1,611

1,668

Deferred revenue mostly relates to cash received in advance from customers with respect to pre-paid VoIP accounts.
The balance represents the unused call credits as at balance date.

13. Provisions

As at 1 July 2016

Arising during the year

Acquired during the year

Utilised during the year
As at 30 June 2017

Current

Non-current

Annual leave

Long service leave

$000

1,300

1,682

(1,570)
1,483

1,483

734

102

118

(33)
921

921

Total

$000

2,034

1,784

189

(1,603)
2,404

1,483

921

A provision has been recognised for employee entitlements relating to long service leave. In calculating the present
value of future cash flows in respect of long service leave, the probability of long service leave being taken is based
on historical data. The measurement and recognition criteria relating to employee benefits have been included in
Note 2.

MNF Group Limited

Notes to the consolidated financial statements

For the year ended 30 June

14. Issued capital
a. Ordinary shares

Issued capital

2017

$000

2016

$000

49,000

26,440

Movements in ordinary shares on issue:

2017

2016

Number of shares $000

At 1 July

Exercise of share options (i)

Exercise of share options (ii)

Exercise of share options (iii)

Issued for cash (iv)

Issued for cash (v)

Issued from DRP participation (vi)

Issued from SPP participation (vii)
At 30 June

67,454,337

26,440

62,710,215

325,000

30,000

4,133,333

168,753

666,841
72,778,264

960

17,949

703

2,948
49,000

10,000

535,000

9,932

1,592

4,054,054

14,449

145,068

-
67,454,337

452

-
26,440

(i) Options exercised with an exercise price of $1.70
(ii) Options exercised with an exercise price of $3.00
(iii) Options were exercised with an exercise price of $Nil
(iv) Shares issued at a price of $3.70
(v) Shares issued at a price of $4.50
(vi) Shares issued as a result of participation in the MNF Group dividend reinvestment plan (at an issue price of

$4.00 and $4.51, 2016: $3.17 and $3.11).

(vii) Shares issued as a result of participation in the MNF Group Share Purchase Plan at a price of $4.50

Share capital movements above are presented net of transaction costs.

Ordinary shares have the right to receive dividends as declared and in the event of winding up the company, to
participate in the proceeds from the sale of all surplus assets in proportion to the number of and amounts paid up
on shares held. Ordinary shares entitle their holder to one vote, either in person or by proxy, at a meeting of the
company.

b. Share options

2017

2016

Movements in share options on issue:

Number WAEP $ Number WAEP $

Outstanding at 1 July

Granted during the year

Exercised during the year

Expired during the year
Outstanding at 30 June

Exercisable

355,000

620,000

300,000

(30,000)

(325,000)

(30,000)
890,000

890,000

3.00

7.15

3.00

3.00
4.98

4.98

910,000

(10,000)

(535,000)

(10,000)
355,000

355,000

2.97

1.70

3.00

1.70
3.00

3.00

The outstanding options balance as at 30 June 2017, issued under the share based payment option scheme to
directors and executives is represented by 620,000 options with an exercise price of $7.15 each and an expiry date of
30 June 2021. Three tranches of options at 90,000 each were issued to employees with an exercise price of $Nil and
expiry dates of 30 June 2018, 30 June 2019 and 30 June 2020 respectively.

www.mnfgroup.limited

MNF Group Limited

Notes to the consolidated financial statements

15. Share based payments

Outstanding options as at year end:

Employee option plan

Option granted to directors
Total

a. Employee option plan (EOP)

2017

2016

Number

440,000

450,000
890,000

355,000

-
355,000

The Board may issue options under the EOP to any employee of the Group, including executive directors and non-
executive directors. Options will be issued free of charge, unless the Board determines otherwise. Each option is to
subscribe for one share and when issued, the shares will rank equally with other shares. Unless the terms on which an
option was offered specify otherwise, an option may be exercised at any time after one year from the date it is granted,
provided the employee is still employed by the company.

An option may also be exercised in special circumstances, that is, at any time within 6 months after the employee’s
death, total and permanent disablement, or retrenchment. An option lapses upon the termination of the employee’s
employment by the company and, unless the terms of the offer of the option specify otherwise, lapses three years after
the date upon which it was granted.

The maximum number of options on issue under the EOP must not at any time exceed 5% of the total number of shares
on issue at that time.

b. Share options granted to directors

450,000 options were granted to directors during the year. The following table illustrates the number and weighted
average exercise prices (WAEP) of and movements of share options held by directors during the year:

2017

2016

Number WAEP $ Number WAEP $

Outstanding at 1 July

Granted during the year

Exercised during the year
Outstanding as at 30 June

450,000

7.15

450,000

3.00

MNF Group Limited

Notes to the consolidated financial statements

16. Commitments and contingencies

Operating lease commitments

Operating leases relate to premises with lease terms remaining between one and eight years. The consolidated
entity does not have an option to purchase the leased assets at the expiry of the lease terms. The operating leases
generally contain escalation clauses, which are fixed increases between three and four percent per annum.

Future minimum lease payments under non-cancellable operating leases not recorded in the financial statements
as at 30 June 2017 are as follows:

Within one year

After one year, not more than five years

More than five years

Commitments

2017

$000

1,169

10,056

6,944
18,169

2016

$000

1,105

4,195

230
5,530

At 30 June 2017, the Group had commitments of $2.3m (2016: $Nil) relating to the fit-out of leasehold properties in
Sydney and Melbourne.

Guarantees

As at 30 June 2017 MNF Group Limited has issued a guarantee to Telstra Corporation Limited. This guarantee covers
all primary obligations including any debts of its wholly owned subsidiaries. It does not impose any greater liability
of MNF Group than is already in place for the subsidiaries collectively.

17. Events after reporting date

Dividends
The dividend as recommended by the Board will be paid subsequent to the balance date.

18. Auditors remuneration

The Auditor of the Group is MNSA Pty Ltd Chartered Accountants.

Auditors of the company:
Amounts received or due and receivable by MNSA Pty Ltd Chartered
Accountants for:

Audit and review of the annual report of the entity

Non-audit services

Other Auditors:

Audit and review of financial statements

2017

$000

2016

$000

272

91
363

255

57
312

www.mnfgroup.limited

MNF Group Limited

Notes to the consolidated financial statements

19. Director and executive disclosures
a. Details of Key Management Personnel (KMP)

Mr Terry Cuthbertson

Mr Michael Boorne

Mr Andy Fung

Mr Rene Sugo

Mr Matthew Gepp

Ms Catherine Ly

Chairman and Non-executive Director

Non-executive Director

Director & Chief Executive Officer

Chief Financial Officer

Company Secretary

b. Compensation of Key Management Personnel

The Group has applied the exemption under Corporations Amendments Regulation 2006 No 4 which exempts listed
companies from providing remuneration disclosures in relation to their key management personnel in their annual
financial reports as required by Accounting Standard AASB 124 Related Party Disclosures. These disclosures are
provided in the Directors’ Report designated as audited.

c. Shareholdings of Key Management Personnel

Directors:
Mr Terry Cuthbertson

Mr Michael Boorne

Mr Andy Fung

Mr Rene Sugo

Executives:

Mr Matthew Gepp

Ms Catherine Ly

Year

2017

2016

2017

2016

2017

2016

2017

2016

2017

2016

2017

2016

Balance at
the beginning
of period

Traded during
the year

Options
exercised

920,000

1,000,000

705,067

682,500

13,969,216

14,448,955

13,160,576

13,488,955

50,000

282,665

260,000

906

(180,000)

22,947

(77,433)

56,773

(579,739)

17,508

(478,379)

(50,000)

5,761

2,665

100,000

150,000

52,000

500

20,000

The above shareholdings are held directly and indirectly through controlled entities.

d. Share options of Key Management Personnel

Year

2017

2016

2017

2016

2017

2016

2017

2016

2017

2016

2017

2016

Balance at
the beginning
of period

Granted

Options
exercised

100,000

150,000

50,000

20,000

100,000

150,000

70,000

25,000

(100,000)

(150,000)

(52,000)

(500)

(20,000)

Directors:

Mr Terry Cuthbertson

Mr Michael Boorne

Mr Andy Fung

Mr Rene Sugo

Executives:

Mr Matthew Gepp

Ms Catherine Ly

Balance at
end of
period

920,906

920,000

728,014

705,067

14,025,989

13,969,216

13,178,084

13,160,576

52,000

288,926

282,665

Balance at
end of
period

100,000

150,000

68,000

50,000

24,500

MNF Group Limited

Notes to the consolidated financial statements

20. Controlled entities

The consolidated financial statements include the financial statements of MNF Group Limited and the subsidiaries
listed in the following table:

Name

My Net Fone Australia Pty Limited

Symbio Networks Pty Limited

Symbio Wholesale Pty Limited

Internex Australia Pty Limited

Pennytel Australia Pty Limited

Mobile Enablement Australia Pty Limited (i)

Symbio Wholesale (Singapore) Pte Limited

TNZI International Pty Limited (ii)

TNZI USA LLC

TNZI New Zealand Limited

TNZI Australia Pty Limited

TNZI UK Limited

TNZI Singapore Pte Limited

Symbio Wholesale NZ Pty Limited

Conference Call International Pty Limited (iii)

Express Virtual Meetings Pty Limited (iii)

Eureka Teleconferencing Pty Limited (iii)

Conference Call Asia Pty Limited (iii)

Ozlink Conferencing Pty Limited (iii)

Country of
Incorporation

Australia

Singapore

Australia

USA

New Zealand

Australia

United Kingdom

Singapore

New Zealand

Australia

Ownership interest

2017

100%

2016

100%

(i) On 13 September 2016, Numbering Services Australia Pty Limited changed its name to Mobile Enablement

Australia Pty Limited.

(ii) On 21 July 2016, Symbio Wholesale International Pty Limited changed its name to TNZI International Pty Limited
(iii) On 9 February 2017, MNF Group completed the acquisition of Conference Call International Pty Limited (CCI)

and its subsidiaries.

www.mnfgroup.limited

MNF Group Limited

Notes to the consolidated financial statements

21. Goodwill and other intangibles

Consolidated

Cost

Goodwill

Brands

Customer
contracts

Software
develop-
ment
costs

Software
and other
assets#

Total

$000

Balance at 1 July 2015

14,617

1,811

1,377

817

11,195

29,817

Adjustment to fair value from

provisional accounts (TNZI)

Additions

2,710

150

2,809

150

Balance at 1 July 2016

17,327

1,823

1,433

967

11,226

32,776

Additions

Acquisition of CCI (note 23)

13,462

3,000

1,500

462

250

462

18,212

Balance at 30 June 2017

30,789

4,823

2,933

1,429

11,476

51,450

Accumulated Amortisation

Balance at 1 July 2015

Amortisation
Balance at 1 July 2016

Amortisation

Balance at 30 June 2017

Net Book Value

At 30 June 2016
At 30 June 2017

-
-

(69)

(290)
(359)

-
-

(440)

(1,175)
(1,615)

(509)

(1,465)
(1,974)

(412)

(192)

(1,175)

(1,779)

(771)

(192)

(2,790)

(3,753)

17,327
30,789

1,823
4,823

1,074
2,162

967
1,237

9,611
8,686

30,802
47,697

# Acquired externally or purchased as part of a business combination.

MNF Group Limited

Notes to the consolidated financial statements

22. Impairment testing

For the purpose of undertaking impairment testing, MNF Group Limited identifies cash generating units (CGUs).
CGUs are determined according to the smallest group of assets that generates cash flows that are separately
identifiable.

The carrying amount of goodwill broken out into CGUs is detailed below:

Goodwill

CGUs

Wholesale

Retail

International

30 June 2017

30 June 2016

$000

6,086

19,327

5,376
30,789

$000

6,086

5,865

5,376
17,327

Goodwill assets are not subject to amortisation and are tested for impairment on an annual basis, or whenever an
indication of impairment exists.

The recoverable amount of the cash generating units has been determined based on value-in-use calculations using
cash flow projections based on five year financial forecasts and assumptions that represent management’s best
estimate of the range of business and economic conditions at the time. Calculations are reviewed and approved by
the Board of Directors.

Value-in-use represents the present value of the future net cash flow arising from the assets continued use and
subsequent disposal. Any reduction in the carrying value is recognised as an expense in the consolidated statement
of profit or loss and other comprehensive income in the reporting period in which the impairment loss occurs.

In determining value in use, management applies its best judgement in establishing forecasts of future operating
performance, as well as a selection of growth rates, terminal rates and discount rates. These judgements are applied
based on management’s understanding of historical information and expectation of future performance.

Management considers that, as the wholesale, retail and data CGUs operate in the Telecommunications Industry in
Australia servicing the same markets, the risks specific to each unit are comparable and therefore a discount rate of
9.8% (2016: 9.6%) is applicable to all domestic CGUs. The long-term growth rate used to extrapolate the cash flows
beyond five years (the Terminal Value) for each CGU is 2.5% (2016: 2.5%). The International CGU has been assessed
using a discount rate of 14.0% (2016: 14.0%) and a Terminal Value of 2.0% (2016: 2.0%)

Based on the results of the tests undertaken no impairment losses were recognised in relation to goodwill.

www.mnfgroup.limited

MNF Group Limited

Notes to the consolidated financial statements

23. Business combinations

Conference Call International Pty Limited (CCI)

On 1 February 2017 MNF Group Limited announced the purchase of Conference Call International Pty Limited (CCI) for

$18.0m. The acquisition completed on 9 February 2017.

CCI is the largest independent conferencing and collaboration provider in Australia.

Goodwill arising from the acquisition has been recognised as follows:

Purchase consideration paid

Less working capital adjustment

Less cash acquired
Net cash paid for CCI

Less fair value of identifiable net assets
Goodwill

Identifiable net asset acquired:

Trade receivables

Doubtful debts provision

Other debtors

Deferred tax asset

Fixed assets

Accumulated depreciation

Customer contracts

Brand names

Software

Trade and other payables

Deferred tax liability

Income tax payable

Provisions
Provisional fair value of identifiable net assets

2017
Consolidated
provisional

$000

18,000

(437)

(577)
16,986

(3,524)
13,462

637

(23)

1,344

(1,043)

1,500

3,000

250

(517)

(1,350)

(227)

(215)
3,524

The fair value of CCI’s intangible assets (brand name, customer bases and software assets) is in the process of being
independently valued, the provisional accounting above includes numbers based on management estimates and will be
revised should the formal valuation of these assets be materially different.

If new information obtained within one year of the date of acquisition about facts and circumstances that existed at the
date of acquisition identifies adjustments to the above amounts, or any additional provisions that existed at the date of
acquisition, then the accounting for the acquisition will be revised.

MNF Group Limited

Notes to the consolidated financial statements

24. Earnings per share

Earnings and weighted average number of ordinary shares used in calculating basic and diluted earnings per share

are:

Net profit attributable to ordinary equity holders of the Company

2017

$000

12,066

2016

$000

8,990

Weighted average number of shares:

Number

Weighted average number of ordinary shares for basic earnings per share

Add effect of dilution:

- Share options

Weighted average number of ordinary shares for diluted earnings per share

000

69,683

890

70,573

000

66,851

355

67,206

25. Dividends paid and proposed

Cents per
share

$000

Date of
payment

Recognised amounts:

2016 fully franked final dividend declared and paid

2017 fully franked interim dividend declared and paid

3.50

3.75

2,372

2,727

29 September 2016

30 March 2017

Unrecognised amounts:

2017 fully franked final dividend declared (i)

4.50

3,275

28 September 2017

(i) The final dividend was declared on 15 August 2017. The amount has not been recognised as a liability in the 2017

financial year and will be brought to account in the 2018 financial year.

The proposed payment date of the 2017 final dividend is 28 September 2017.

The amount of franking credits available for future reporting periods is $5,092,271 (2016: $4,207,757).

The tax rate at which paid dividends have been franked is 30% (2016: 30%).

Dividends proposed will be franked at the rate of 30%.

www.mnfgroup.limited

MNF Group Limited

Notes to the consolidated financial statements

26. Parent entity

Key financial information relating to the parent entity is summarised below:

Statement of profit or loss and other comprehensive income

Profit/(loss) attributable to the owners of the company

Other comprehensive income

Total comprehensive income/(loss) attributable to the owners of the company

Statement of financial position

Total current assets

Total non-current assets

Total current liabilities

Total non-current liabilities
Net assets

Issued Capital

Reserves

Retained earnings
Total equity

2017

$000

(128)

(142)
(270)

3,330

61,697

(5,488)

(8,432)
51,107

53,815

1,506

(4,214)
51,107

2016

$000

23,120

259
23,379

6,582

44,485

(374)

(13,951)
36,742

31,255

1,071

4,416
36,742

27. Financial risk management objectives and policies

The Group’s principal financial instruments as at year end comprise cash at bank, trade and other receivables, trade
payables, forward foreign exchange contract and a loan facility.

The main risks arising from the Group’s financial instruments are foreign currency risk, interest rate risk, liquidity risk
and credit risk. The Board reviews and agrees policies for managing each of these risks and they are summarised below:

Foreign currency risk:

The Group is exposed to foreign exchange risks arising from various currency exposures, primarily with respect to
the United States Dollar (USD) and the New Zealand Dollar (NZD). Much of the USD exposure is subject to a natural
hedge, as the buy and sell side of most foreign currency transactions are in USD. Any unhedged foreign exchange
positions associated with our transactional exposures will directly affect profit or loss as a result of foreign currency
movements. The Group’s objective is to manage its foreign exchange risk against its functional currency and to hedge
firm commitments and highly probable and material forecast transactions over varying time horizons using forward
exchange contracts. All contracts have been entered into with major creditworthy financial institutions.

Sensitivity to foreign currency movements:

A movement of 10% in the Australian dollar at 30 June 2017 would impact the profit or loss by less than $250k (30 June
2016: $400k). This analysis assumes a movement in the Australian dollar across all currencies and only includes the
effect of foreign exchange movements on monetary financial instruments.

Interest rate risk:

The Group’s interest rate exposure relates to short term cash and long-term loans, both are subject to the floating
interest rate. The Group’s objective is to minimise the cost of net borrowings and to minimise the impact of interest
rate movements on the Group’s interest expense and net earnings. The Group policy is to maintain at least 50% of its
long term loan at fixed rates using interest rate swaps whereby the Group agree to exchange at defined periods the net
difference between fixed and floating interest rates based on an agreed notional principal amount. This interest rate
swap is designated into a hedge relationship and satisfies the requirements for hedge accounting.

MNF Group Limited

Notes to the consolidated financial statements

Liquidity risk:

Liquidity risk represents the Group’s ability to meet its contractual obligations as they fall due. The Group’s objective
is to maintain a balance between continuity of funding and flexibility through the use of current accounts, short
term deposits, long-term borrowings, preference shares, finance leases and a revolving multi-option credit facility.
The Group has access to a sufficient variety of sources of funding to adequately mitigate liquidity risks.

Credit risk:

The company has no significant exposure to credit risk. For credit sales the Group only trades with recognised
creditworthy third parties. It is the Group’s policy that all customers who wish to trade on credit terms are subject
to credit verification procedures. Ageing analysis and ongoing credit evaluation are performed on the financial
condition of our customers and, where appropriate, an allowance for doubtful debts is raised. In addition, receivable
balances are monitored on an ongoing basis so that our exposure to bad debts is not significant.

Set out below is a comparison by category of carrying amounts and fair values of all of the Group’s financial
instruments recognised in the financial statements.

2017

2016

Carrying
amount

$000

Fair
value

$000

Carrying
amount

$000

Fair
value

$000

16,905

11,259

35,453

41,630

Financial assets

Cash
Weighted average effective interest rate 0.1% (2016: 0.1%)

Cash at call
Weighted average effective interest rate 2.6% (2016: 3.2%)

Trade and other receivables

30,121

29,067

Financial liabilities

On statement of financial position

Trade payables

Loans and borrowings

Weighted average effective interest rate 4.80% (2016: 4.87 %)

Forward foreign exchange contract - fair value hedge

Interest rate swap contract - cash flow hedge

63,181

11,190

592

140

63,181

11,190

66,550

13,690

66,550

13,690

592

140

2,812

282

2,812

282

28. Company details

The registered office and principal place of business of MNF Group Limited is:
Level 3, 580 George Street, Sydney, NSW, 2000, Australia

www.mnfgroup.limited

MNF Group Limited

Directors’ Declaration

In accordance with a resolution of the directors of MNF Group Limited, the directors of the company declare that:

The financial statements and notes, as set out on pages 32 to 65, are in accordance with the Corporations Act 2001
and:

comply with Australian Accounting Standards, which, as stated in accounting policy Note 2 to the financial
statements, constitutes compliance with International Financial Reporting Standards (IFRS); and

b. give a true and fair view of the financial position as at 30 June 2017 and of the performance for the year ended

on that date of the consolidated group;

in the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as
and when they become due and payable; and

the directors have been given the declarations required by s295A of the Corporations Act 2001 from the Chief
Executive Officer and Chief Financial Officer.

On behalf of the Board

Terry Cuthbertson
Chairman

Rene Sugo
Director

Sydney, 15 August 2017

MNSA Pty Ltd
ABN 59 133 605 400

ASX Additional
Information

MNF Group Limited

ASX Additional Information

Additional information required by the ASX Ltd and not shown elsewhere in this report is as follows.

The information is current as at 01 August 2017.

(a) Distribution of equity securities

(i) Ordinary share capital

72,778,264 fully paid ordinary shares are held by 3,186 individual shareholders.
All issued ordinary shares carry one vote per share and carry the rights to dividends.

(ii) Options

890,000 unlisted options are held by 58 individual option holders.
Options do not carry a right to vote.

The numbers of shareholders, by size of holding, in each class are:

Fully paid ordinary shares

1 – 1,000

1,001 – 5,000

5,001 – 10,000

10,001 – 100,000

100,001 and over

The number of security investors holding less than a marketable parcel of ordinary shares is 108.

(b) Substantial shareholders

Fully paid

Ordinary shareholders

Mr Andy Fung and related parties

Mr Rene Sugo and related parties

NAOS Asset Management Limited

Milford Funds Ltd

Number

14,025,989

13,178,084

4,348,529

3,686,525

1,000

1,217

423

510

36
3,186

Percentage

19.28

18.11

5.98

5.07

www.mnfgroup.limited

MNF Group Limited

ASX Additional Information

Fully paid

Number

Percentage

Mr Andy Kan Kam Fung & Ms My Van Monique Ly

Avondale Innovations Pty Ltd

National Nominees Limited

AET SFS Pty Ltd

Citicorp Nominees Pty Ltd

BNP Paribas Noms Pty Ltd

L & C Pty Ltd

HSBC Custody Nominees (Australia) Limited

RACS SMSF Pty Ltd

Kore Management Services Pty Ltd

Sandhurst Trustees Ltd

Boorne Gregg Investments Pty Ltd

Boorne Superannuation Fund Pty Ltd

JP Morgan Nominees Australia Limited

G & E Properties Pty Ltd

Lee Superfund Management Pty Ltd

Mr Michael John Boorne

Earglow Pty Ltd

Ms Catherine Ly

Mr Christopher John Ayres

(d) On-market buy back

There is currently no on-market buy back.

13,817,635

12,138,955

6,717,328

3,333,456

3,077,496

2,910,494

1,834,117

1,678,524

1,039,129

920,906

906,311

875,906

805,906

765,600

529,247

430,000

364,608

350,000

288,926

280,000
53,064,544

18.99

16.68

9.23

4.58

4.23

4.00

2.52

2.31

1.43

1.27

1.25

1.20

1.11

1.05

0.73

0.59

0.50

0.48

0.40

0.38
72.91

Corporate Information

Directors

Terry Cuthbertson (Chairman)

Michael Boorne

Andy Fung

Rene Sugo (CEO)

Company Secretary

Catherine Ly

Chief Financial Officer

Matthew Gepp

Registered Office

Level 3, 580 George Street

Sydney NSW 2000

Australia

Principal Place of Business

Level 3, 580 George Street

Sydney NSW 2000

Australia

Phone: 61 2 8008 8000

Share Register

Link Market Services Limited

Level 12, 680 George Street

Sydney NSW 2000

Australia

Phone: 61 2 8280 7100

This annual report covers both MNF Group Limited

as an individual entity and the consolidated group

comprising MNF Group Limited and its subsidiaries.

The Group’s functional and presentation currency is

AUD (s).

The company is listed on the Australian Securities

Exchange under the code MNF.

The Annual General Meeting of MNF Group Limited

will be held at Level 4, 580 George Street, Sydney at

16:30 on 14 November 2017.

Bankers

Westpac Banking Corporation

Westpac Place

Sydney NSW 2000

Australia

Auditors

MNSA Pty Ltd

Chartered Accountants

Level 2, 333 George Street

Sydney NSW 2000

Australia

Annual Report

Copies of the 2017 Annual Report with the Financial

Statements can be downloaded from:

www.mnfgroup.limited/investors/annual-reports

www.mnfgroup.limited

MNF Group Limited Annual Report 2017