INVESTING
IN OUR
BRANDS
For today and tomorrow
ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
CONTENTS
12
18
Chairman’s
Report
Directors’
Report
36
44
Remuneration
Report
52
53
Auditor’s
Independence
Declaration
Independent
Auditor’s
Report
Corporate
Governance
Statement
57
Directors’
Declaration
58
59
60
61
62
Consolidated
Statement
of Profi t or
Loss & Other
Comprehensive
Income
Consolidated
Statement
of Financial
Position
Consolidated
Statement
of Changes in
Equity
Consolidated
Statement
of Cash Flows
Notes to the
Financial
Statements
88
Additional stock
exchange
information
3
2
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
INVESTING IN
OUR BRANDS
FOR TODAY AND
TOMORROW
Pental is a proud Australian company manufacturing a
wide range of iconic brands whose products are staples in
households across Australia, New Zealand and Asia.
Our brands have been used for generations in all areas of the
home – bathroom, kitchen, toilet and laundry – and still help
make everyday life that much easier & simpler.
We are Australia’s largest manufacturer of bar soaps, liquid
bleach and fi relighter cubes at our manufacturing plant in
Shepparton Victoria.
We take pride in our people and our customers, investing
in our employee’s growth and developing long lasting
relationships with our customers.
For over 60 years we have provided our customers with
superior quality products – White King, Janola, Sunlight,
Country Life, Velvet, Softly, Huggie, Duracell, Little Lucifer
and Jiffy – but we will not rest on our laurels.
We will continue to improve, innovate and invest to keep
our brands popular and relevant for today and tomorrow.
4
5
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
OUR
VISION
To be a leading supplier of shelf stable
products to its chosen markets, built
around a reputation of delivering quality,
innovation and sustainability to the
satisfaction of customer needs whilst
enhancing shareholder value
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7
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
Customers
Heart of our business
■ Build trusted and recognised brands
■ Develop lasting relationships
■ Responsive to their needs
■ Provide outstanding value
■ Pride in delivering the best
products on time
Quality
Quality control
■ Immensely proud of our quality
■ Accountability for achieving
business objectives
■ Agile, fl exible and welcome change
■ Long-term focus and plan for a sustainable future
CORE
VALUES
Safety
#1 priority
■ Zero harm objective
■ Proactive in hazard identifi cation
■ Maintain clean and safe equipment
Innovation
Embracing new ideas
■ Dare to be different
■ Challenge the status quo
■ Encourage fresh ways of working
■ Maximise consumer insights
People
Trust & development
■ Compassion, honesty and consistency
■ Empower, trust and support others
■ Encourage positive can-do attitudes
■ Work as one team, communication
■ Foster personal growth and career
development, success
8
9
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
YEAR AT
A GLANCE
Financial year ending 30 june 2020
AUG 19
SEP 19
NOV 19
JAN - FEB 20
MAR 20
APR 20
MAY 20
JUN 20
New pack design
Refreshed look across the
core Bleach portfolio
Install New Liquid fi lling
line in Shepparton
Social Media, Infl uencer,
Online Consumer
Promotions & Programatics
Promotions & Programatics
Outdoor Advertising &
Sponsorships
White King & Country Life
NEW Country Life
Anti Bacterial range
Anti Bacterial range
Anti Bacterial range
Anti Bacterial range
New 3 White King
Hospital Grade
Disinfectant products
Driving sales with the
Australian Made Australian
Owned Platform
Supporting local
Supporting local
jobs in Victoria
jobs in Victoria
The “Thankyou” Campaign
A video series interviewing
Pental staff members
about why they love their
job and supporting local
communities.
communities.
Product innovation
Bathroom Powergel
Mould & Soap Scum Remover
Children’s Ground NT
Charitable donations
Supporting communities
Supporting communities
East Timor
East Timor
NEW Ranged in Bunnings
White King 2L Bleach and
Tradie Soap
10
11
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
▼
CHAIRMAN’S
REPORT
I am pleased to present Pental’s Annual Report for
the year ended 28 June 2020.
We have had a very successful year focussing on our
core brands, launching new products, driving further
effi ciencies in manufacturing and growing our
business signifi cantly.
12
13
OUR STRENGTH
IS OUR ABILITY
TO ADAPT AND
INNOVATE
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
CHAIRMAN’S REPORT [CONT]
Statutory & underlying profi t comparison to prior period
Underlying EBITDA(ii)
Depreciation and amortisation
Underlying EBIT
Finance costs
Underlying profi t before tax
Underlying income tax expense
Underlying net profi t after tax
Signifi cant items (net of tax):
Impairment of brandnames (net of tax)
Reported profi t after tax
FY20(i)
$’000
11,972
(4,576)
7,396
(175)
7,221
(2,202)
5,019
-
5,019
FY19(i)
% Change
$’000
8,330
(3,316)
5,014
(73)
4,941
(1,490)
3,451
(1,530)
1,921
43.7%
47.5%
46.1%
45.4%
161.3%
(i) Non-IFRS fi nancial table
(ii) FY20 EBITDA includes the impact of adopting AASB 16 Leases. Refer to page 26 for an overview of the impact of adopting AASB 16 and Page 26 for a like-for-like comparison
Our underlying profi t after tax for FY20 was up 45.4% on last year
and our statutory profi t was up 161.3% from $1.921 million in FY19
to $5.019 million in FY20.
As the Group enters FY21, there remains a strong demand for
our trusted brands from our retail partners as well as from our
consumers. Our products are ‘Australian Made, Australian and
New Zealand owned’. Producing quality products is our core focus
with consumers placing greater emphasis on locally made quality
products at a competitive price.
Pental has invested heavily in supporting its two big brands White
King and Country Life through both social media and outdoor
advertising. As a result, sales grew with White King bleach,
household cleaners and Country Life bar soaps compared to the
prior year even though the competition continued with heavy price
discounting to infl uence consumer purchasing.
As private label grew in most categories Pental continued to focus
on ways to reduce production costs and remain competitive. Pental’s
agility to be responsive to target changing market conditions
brought about with COVID-19 resulted in the company experiencing
strong growth in the second half of the fi nancial year.
In this highly competitive market, our brands remain well-placed
with Pental achieving growth in all sales channels such as Metcash,
Coles, Woolworths, and Pharmacy. Growth was also achieved in
categories such as toilet, household cleaning and dish wash in New
Zealand while in Australia White King bleach and White King Lemon
toilet gel retain their #1 position in grocery along with the Jiffy and
Softly brands in their segments.
Product innovation remained as the focus with the R&D and
Marketing teams. We know our customers and consumers and have
developed the right products for purpose. Our strength is our ability
to adapt and innovate. We have expanded our trusted legacy brands
into new segments such as disinfectants and anti-bacterial handwash.
Export remains an important part of our long-term growth vision
with sales and margins increasing on the prior year.
We are not afraid of new ventures and our capital investment means
our production facility is more agile and can produce a wider range
of products for more purpose.
14
15
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
PRODUCT INNOVATION
IS THE KEY TO PENTAL’S
LONG TERM SUCCESS
▼
CHAIRMAN’S REPORT [CONT]
DIVIDEND
The board has declared a fully franked fi nal dividend of 1.5 cents per share payable to shareholders on 25
September 2020, with a record date of 7 September 2020. This takes total dividends for the year to 2.9 cents
per share. Excluding a special dividend of 0.7 cents per share this represents a 10% increase on the prior year’s
dividend of 2.0 cents. Including the special dividend, it was a payout ratio of 78.7% of Net profi t after tax.
LOOKING FORWARD
Pental expects to maintain momentum in FY21.
Pental’s strategic distribution partnership with Duracell will support sustainable profi tability and we are now
exploring additional partnership opportunities. We continue to support our own trusted brands such as White
King, Janola, Country Life and Softly with strong above the line investment.
Product innovation is the key to Pental’s long term success, and we continue to explore opportunities to
introduce new products, similar to the successful launch of the White King disinfectants and Country Life anti-
bacterial handwash.
The Company is also working with key customers to expand its portfolio of products of Private Label.
In a further step towards export growth, we are currently in the early stages of supply with a large distributor
in China that can provide more scale into the market where high quality Australian brands are well regarded.
The Company will continue to investigate opportunities to supply other markets.
We will continue delivering on our fi ve strategic priorities:
1. Driving sales growth
2. Developing new products
3. New Sales channels
4. Export markets
5. Continuous manufacturing improvements
Given the strong underlying performance of the group coupled with a strong balance sheet, Pental is seeking
to identify and evaluate potential acquisitions to fi t within its business.
I acknowledge the efforts of my fellow Directors over the past year. I also welcome Charlie McLeish on the
board as Managing Director.
On behalf of the Board I sincerely thank our people for their committed efforts during the year, especially
our operations team at our Shepparton facilities who have successfully navigated an unprecedented tough
environment to deliver our customers and shareholders a great result. We again thank our shareholders,
suppliers and customers for their ongoing loyalty and support.
Mark Hardgrave
Chairman
16
17
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
DIRECTORS’
REPORT
THE DIRECTORS OF PENTAL
LIMITED SUBMIT HERE WITH
THE ANNUAL FINANCIAL
REPORT OF THE COMPANY
FOR THE YEAR (52 WEEKS)
ENDED 28 JUNE 2020.
The names and particulars of
the directors of the company
during or since the end of the
fi nancial year are:
MARK HARDGRAVE
CHARLIE MCLEISH
JOHN ETHERINGTON
JEFF MICIULIS
FRED HARRISON
B.Ec
Bachelor of Business
B.Ec, FCA, FAICD
Non-Executive Independent Director
Non-Executive Independent Director
Non-Executive Independent Chairman
Managing Director
Non-Executive Independent Director
Mark has over 35 years’ experience having
held previous positions in corporate
fi nance, funds management and various
C-suite roles. He is currently a non-
Executive Director of ASX listed companies
Traffi c Technologies Limited, Wingara
AG Limited and a Director of Reclink
Australia.
He is a co-founder and former joint
Managing Director of M&A Partners, a
Melbourne based boutique corporate
advisory group. Prior to that, Mark was
involved in funds management, equity
capital markets and mergers & acquisitions
in various roles at fi rms such as Bennelong
Group, Thorney Investment Group, Merrill
Lynch and Taverners Group.
Appointed Director 1 May 2019
Appointed Chairman 31 December 2019
Member of Audit Committee and Member of
Remuneration Committee.
Before his appointment at Pental, Charlie
McLeish spent over 30 years in the
Fast-Moving Consumer Goods (FMCG)
industry including 20 years managing
major bakeries within Bunge Australia
(Goodman Fielder) focusing on Business
Turnaround.
After Goodman Fielder, Charlie spent
15 years at George Weston Foods in the
position of General Manager of Tip Top
Bakeries Victoria where he managed a
major turnaround to profi tability. Charlie
then transitioned to National Sales
Director of Don Smallgoods.
Charlie has vast sales, marketing,
manufacturing and logistics experience
with proven turnaround capabilities.
Appointed CEO 1 January 2014
Appointed Managing Director 6 April 2020
John is a former senior partner of
Deloitte, where he held both senior
leadership positions and provided audit
and advisory services to public, private
and not for profi t organisations, with
a particular specialisation on rapidly-
growing Australian-listed entities. He is
also currently a non- executive director
on a range of private and not for profi t
organisations.
Appointed Director 2 April 2013.
Chairman of Audit Committee and Member of
Remuneration Committee.
Fred is the CEO of Ritchies Stores Pty
Ltd. He began his career as a casual with
Ritchies in 1975, whilst still at Frankston
High School, and worked his way up to
management before being appointed
as General Manager in 1987 and then as
Chief Executive Offi cer in 1994.
Ritchies operates 78 supermarkets and
liquor stores making Ritchies the largest
Independent in Australia, with annual
sales greater than $1.15 billion.
Appointed Director 28 August 2019
Member of the Audit Committee and Member of
Remuneration Committee.
Jeff brings 35 years’ experience in Sales,
Marketing, Country Leadership, and
Regional Leadership at Energizer in both
Household Batteries, and Personal Care
Shaving Products.
He commenced his career as a Sales
Trainee with Eveready Australia and
rose to become National Sales Manager
before taking his career overseas for the
next 20 years. During that time he held
numerous leadership roles of increasing
responsibility across multiple international
markets.
Overseas roles included International
Marketing, General Manager South
Africa, Managing Director Malaysia,
Regional Vice President Middle East, and
Africa, and Regional Vice President South
Asia, and China.
Appointed 5 March 2019.
Member of the Audit Committee and Member of
Remuneration Committee.
Each of the directors held offi ce during the fi nancial year
and as at the date of this report, unless otherwise noted
above. All directorships of other listed companies held by
directors in the three years immediately before the end of
directors in the three years immediately before the end of
directors in the three years immediately before the end of
directors in the three years immediately before the end of
directors in the three years immediately before the end of
the fi nancial year are indicated above under “experience
the fi nancial year are indicated above under “experience
the fi nancial year are indicated above under “experience
the fi nancial year are indicated above under “experience
the fi nancial year are indicated above under “experience
and responsibilities”.
18
RETIRED DIRECTORS
JOHN RISHWORTH
Non-Executive
Independent Director
(Resigned)
John has worked in the Fast Moving Consumer Goods sector
for over 30 years. He held signifi cant senior positions within
Woolworths before founding his own successful retail brokerage
business in 1987. Since selling that business he has taken on a
number of consultancy assignments within the retail sector.
Appointed Director 9 September 2004.
Resigned 28 August 2019
Member of Audit Committee and Member of Remuneration Committee
PETER ROBINSON
B.Eco (Mon)
Non-Executive Independent
Chairman (Resigned)
Peter has a wealth of experience in the manufacturing sector
within Australia and internationally. He was the Chief Executive
of ACI Packaging Group and Vice President of Owens-Illinois Inc,
the parent company of ACI Packaging Group. Previous roles
include Chief Operating Offi cer and Director of BTR Nylex
Limited, and General Manager of Bowater Scott, where he held
substantial marketing roles.
Appointed Director on 29 November 2002.
Appointed Chairman on 5 March 2009.
Resigned 31 December 2019
Member of the Audit Committee and Chairman of Remuneration Committee.
19
▼
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
DIRECTORS’ REPORT [CONT]
Each of the directors held offi ce during the fi nancial year and as at the date of this report, unless otherwise noted above. All directorships
of other listed companies held by directors in the three years immediately before the end of the fi nancial year are indicated above under
“experience and responsibilities”.
DIRECTORS’ SHAREHOLDINGS
The following table sets out each director’s relevant interest in shares, and options over shares of the company as at the date
of this report.
Directors
Mark Hardgrave
Charlie McLeish
John Etherington
Jeff Miciulis
Fred Harrison
Fully paid ordinary
shares Number
Share options
Number
Unvested Performance
rights Number
100,000
14,500
160,000
800,000
250,000
-
-
-
-
-
-
685,000
-
-
-
SHARE OPTIONS GRANTED TO DIRECTORS AND SENIOR MANAGEMENT
During and since the end of the fi nancial year no share options were granted to Non-Executive Directors or senior management,
however the Group’s Executive Director (Charlie McLeish) and senior management were issued performance rights pursuant to the
Executive Variable Incentive Plan (EVIP) as detailed in the Remuneration Report.
MR OLIVER CARTON
B Juris LL.B
Company Secretary
Experience and Responsibilities
Oliver is a qualifi ed lawyer with over 30 years’ experience in a variety of corporate roles.
He currently runs his own consulting business and was previously a Director of the
Chartered Accounting fi rm KPMG where he managed its Corporate Secretarial Group.
Prior to that, he was a senior legal offi cer with ASIC.
Oliver is an experienced company secretary and is currently company secretary of a
number of listed and unlisted companies, ranging from Pental Limited to the not for
profi t Melbourne Symphony Orchestra Pty Ltd.
PRINCIPAL ACTIVITIES
The principal activities of the Group during the course of the fi nancial year were the manufacturing and distribution
of personal care and home products.
20
21
▼
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
DIRECTORS’ REPORT [CONT]
For more than 60 years we have worked hard to stay true to
our Australian heritage, investing in our manufacturing plant
in Shepparton, Victoria.
The production plant at Shepparton facilities comprise of:
■ Household Cleaning Liquids plant;
■ Bar Soap plant;
■ Laundry and Dishwashing Liquids plant;
■ Firelighters plant.
Across Australia and New Zealand, Pental’s products are stocked
in all major grocery retailers and convenience stores that sell
personal care and household cleaning products. We continue
to expand into commercial and industrial channels.
COMPANY OVERVIEW –
TRUSTED BRANDS THAT GET
THE JOB DONE
Pental Limited is a trusted manufacturer and distributor of
personal, household and commercial products across Australia,
New Zealand and Asia. The company is based in Australia and has
126 full time equivalent employees.
The Company manages a portfolio of leading brands, which are
household names in Australia and New Zealand – it is a branded
market leader and the largest local manufacturer of bar soaps,
liquid bleach and fi relighter cubes.
The Company also provides distributorship services to brands
and products that are non-perishable and have a long shelf life.
Pental has grown through dedication to customer service,
effi ciency and quality.
PENTAL’S CORE BRANDS
Pental’s core brands are household names:
REVIEW OF OPERATIONS
Financial performance highlights
Gross Sales
Trade spend rebates & discounts
Net sales revenue
Trade spend to gross sales
Underlying EBITDA on like for like basis (ii)
Underlying EBITDA margin on net sales
Depreciation & Amortisation
Underlying EBIT
EBIT to gross sales
• WHITE KING IN AUSTRALIA
• COUNTRY LIFE & VELVET IN AUSTRALIA
Underlying EBIT margin on net sales
• SOFTLY IN AUSTRALIA & NEW ZEALAND
• LITTLE LUCIFER IN AUSTRALIA & NEW ZEALAND
Underlying net profi t after tax
• JANOLA & SUNLIGHT IN NEW ZEALAND
• JIFFY IN AUSTRALIA
Personal Care
Household cleaning
Laundry
Fire Needs
Kitchen
Shareholder metrics
Basic EPS - cents per share
Underlying Basic EPS - cents per share (iii)
Total Dividends declared - cents per share
Cashfl ow and capital management
Working Capital (iv)
Net Cash/(Debt)
Cash fl ows from operating activities
EBITDA conversion to operating cash
Gearing (v)
CARMINE
CONTE
Site operations manager
“I’m very proud of the
product we make and a
supporting good team.”
FY20(i)
$’000
FY19(i)
$’000
188,994
153,986
(62,534)
(53,540)
126,460
33.1%
11,423
9.0%
(4,576)
7,396
3.9%
5.8%
5,019
3.68
3.68
2.90
100,446
34.8%
8,330
8.3%
(3,316)
5,014
3.3%
5.0%
3,451
1.41
2.53
2.00
25,405
23,377
3,668
8,505
71%
0.0%
246
(2,430)
10,935
-29%
0.0%
Change
$’000
35,008
(8,994)
26,014
3,093
(1,260)
2,382
1,568
2.27
1.15
0.90
2,028
3,422
%
22.7%
16.8%
25.9%
-1.7
37.1%
0.7%
38.0%
47.5%
0.6%
0.8%
45.4%
161.0%
45.5%
45.0%
8.7%
NMF (vi)
450.0%
100.0%
Pental is expanding distribution throughout Asia, through developing products and pack sizes that are suitable for these new markets.
We currently export into China, Vietnam and Thailand. This has been achieved mainly through creating partnerships with strategically
aligned distributors. We are also exploring opportunities around e-commerce platforms and other overseas markets to expand our business.
(i) Non-IFRS fi nancial table
(ii) FY20 EBITDA adjusted to reverse impact of new accounting standard AASB 16 Leases, FY19 EBITDA adjusted for non cash brand impairment refer to reconciliation on page 26
(iii) Underlying Basic EPS represents underlying net profi t after tax divided by the number of ordinary shares on issue during FY20 and FY19 of 136,250633 used in the
calculated of reported EPS
(iv) Receivables plus inventory less trade and other payables
(v) Net debt (Net of cash and fi nancial liabilities) to equity.
(vi) Not a meaningful fi gure
22
23
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
DIRECTORS’ REPORT [CONT]
■ Exports to Asia grew by $0.392 million or 20.59% compared to
Please refer to the following reconciliation for statutory profi t comparison to prior period:
FINANCIAL PERFORMANCE
■ Gross sales of $188.994 million were up 22.7% or $35.008
million on last year, driven by increases across owned brands
and distributed brands. FY 20 also included two additional
months of trading for Duracell products as the distributorship
agreement commenced in September 2018.
■ Net sales revenue was up 25.9% which was driven by increase
in gross sales as well as a 1.7% reduction in trade spend and
rebates ratio to gross sales.
■ Net sales revenue in Australia was up 26.98% or $23.280 million
on last year driven by a strong uptake of branded cleaning and
personal care products which was assisted by new products
introduced to the market during COVID 19 pandemic. Duracell
branded products delivered a strong net sales growth of
44.26% in Australia compared to prior period. After excluding
the additional 2 months of trade (July and August 2019) in the
fi nancial year, Duracell net sales in Australia grew by 26.80%
on a like for like basis. Pears also performed quite strongly for
the fi nancial year with net sales revenue up 74.5% compared to
prior year primarily driven by surge in demand for soaps due
to COVID 19.
■ Net sales revenue in New Zealand was up $2.341 million on last
year (in New Zealand dollars) or 18% due to strong sales across
most brands and categories led by bleach, toilet, household
cleaners and manual dishwash. Pental’s share in New Zealand
market in several categories such as Toilet, Household Cleaning
and Dish Wash remains strong.
prior year. Although it was a good growth in export market, the
progress was impacted by COVID 19 driven disruptions. At the
peak of demand, supply to Australian and New Zealand markets
was prioritised.
Reported EBIT (Earnings Before Interest and Tax) of $7.396 million
was $2.382 million (or 47.51%) higher compared to underlying
EBIT for last year after adjusting last year reported EBIT for non-
cash impairment charge of $2.185 million ($1.530 million net of
tax) on brand names.
Net profi t after tax (NPAT) was $5.019 million which was 45.4%
higher compared to underlying NPAT for last year, after adjusting
last year’s reported NPAT for non-cash impairment charge of
$1.530 million net of tax on brand names.
■ The Group believes that presenting underlying results provides a
better understanding of its fi nancial performance by facilitating
a more representative comparison of fi nancial performance
between fi nancial periods. Prior period underlying results
exclude the effect of non-operating items that are unrelated to
the underlying performance of the business.
■ Underlying results have been presented with reference to the
Australian Securities and Investment Commission Regulatory
Guide 230 “Disclosing non-IFRS fi nancial information”.
NET SALES REVENUE
IN AUSTRALIA
UP 26.98%
GROSS SALES OF
$188.994 M
UP 22.7%
Statutory & underlying profi t comparison to prior period
Underlying EBITDA(ii)
Depreciation and amortisation
Underlying EBIT
Finance costs
Underlying profi t before tax
Underlying income tax expense
Underlying net profi t after tax
Signifi cant items (net of tax):
Impairment of brandnames (net of tax)
Reported profi t after tax
FY20(i)
$’000
11,972
(4,576)
7,396
(175)
7,221
(2,202)
5,019
-
5,019
FY19(i)
% Change
$’000
8,330
(3,316)
5,014
(73)
4,941
(1,490)
3,451
(1,530)
1,921
43.7%
47.5%
46.1%
45.4%
161.3%
(i) Non-IFRS fi nancial table
(ii) FY20 EBITDA includes the impact of adopting AASB 16 Leases. Refer to page 26 for an overview of the impact of adopting AASB 16 and Page 26 for a like-for-like comparison
■ Pental continued its focus on effi ciency improvement and driving production costs down. As a result, even though direct production
labour increased by $0.493 million predominantly due to increased production driven by increased demand, labour utilisation factor
improved by 1.5% compared to prior year.
■ Energy and utility costs largely remained in line with last year as a percentage of production costs. Number of cartons produced were
up 9.8% compared to prior year.
■ The Group invested in supporting its core brands White King and Country Life through various platforms including social media,
sponsorship of Western Bulldogs football club and advertisements to ensure our high quality Australian manufactured brands remain
relevant to the consumers. As a result, marketing expenses were $0.721 million above prior period.
■ The business experienced price pressures in freight and distribution expenses due to majority of freight capacity in Shepparton region
being consolidated by one major supplier. To mitigate this pressure, the Group agreed with major retailers preferred freight providers
and negotiated prices with various other freight providers to supply non-major sales channels.
PENTAL CONTINUED ITS
FOCUS ON EFFICIENCY
IMPROVEMENT AND DRIVING
IMPROVEMENT AND DRIVING
PRODUCTION COSTS DOWN.
24
25
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
DIRECTORS’ REPORT [CONT]
IMPACT OF AASB 16
AASB 16 Leases became effective for the Group on 1 July 2019. As a result, the Group changed its related accounting policies resulting in
recognition of Right-of-use assets and associated lease liabilities at 1 July 2019. The nature and effect of these changes are disclosed in
attached fi nancial report and notes.
In summary, the overall earnings impact for the period ended 28 June 2020 arising from the adoption of AASB 16 is:
■ An increase in EBITDA of $549 thousand and a corresponding increase in depreciation of $552 thousand. This has resulted in a reduction
in EBIT of $3 thousand.
■ An increase in interest expense of $59 thousand. In combination with the reduction in EBIT, this has resulted in a reduction in net profi t
before tax of $62 thousand.
Comparison of FY20 EBITDA to prior period
Reported profi t after tax
Income tax expense
Finance costs
EBIT
Depreciation and amortisation
Reversal of impact of AASB on EBITDA
EBITDA excluding impact of AASB 16
Signifi cant items;
Impairment of brandnames
Underlying EBITDA excluding impact of AASB 16
(i) Non-IFRS fi nancial table
FY20(i)
FY19(i)
% Change
$’000
5,019
2,202
175
7,396
4,576
(549)
11,423
-
11,423
$’000
1,921
835
73
2,829
3,316
-
6,145
2,185
8,330
161.3%
161.4%
38.0%
100.0%
85.9%
37.1%
ROBYN
GLEDHILL
Quality Assurance Manager
“Amazing system
in place and quality
standards are well above
what you’d expect.”
26
27
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
SHAREHOLDER METRICS
■ The total dividend for the 2020 fi nancial year is 2.9 cents per
ordinary share (2019: 2.0 cents), representing a payout ratio
of 78.7% of the full-year NPAT (2019: 79.0% of the underlying
NPAT) and consists of:
- Interim fully franked dividend of 0.70 cents per ordinary share,
which was paid 25 March 2020;
- A one-off special dividend of 0.70 cents per ordinary share
payable to the shareholders on 7 August 2020 with a record date
of 31 July 2020.
- Proposed fi nal fully franked dividend of 1.50 cents per ordinary
share, payable to shareholders on 25 September 2020, with a
record date 7 September 2020.
■ Basic earnings per share (EPS) of 3.68 cents was 2.27 cents (or
160.99%) above prior year’s EPS of 1.41. On an underlying basis,
EPS was 45.60% higher compared to 2.53 cents per share in prior
period (i.e. excluding signifi cant non-cash items in prior period).
CASH GENERATION AND CAPITAL
MANAGEMENT
Net cash provided by operating activities was $8.505 million (2019:
Net cash used in operating activities $2.430 million) representing a
strong cash conversion of EBITDA at 71%.
KILLS 99.99%
KILLS 99.99%
OF GERMS **
OF GERMS
Net working capital (receivables, inventories less trade and other
payables) of $25.212 million was higher than last year by $1.835
million predominantly due to timing of fi nancial year end on 28
June 2020. Majority of debtors in New Zealand market have an
agreed calendar month end payment terms which meant June
month end cash receipts will be factored in next fi nancial year. In the
prior year, debts due at end of June 19 were collected in the same
fi nancial year. Pental’s debtors’ position and cash collection continue
to be strong, with minimal overdues as at the reporting date.
Capital investment of $2.079 million was marginally lower
than prior year (2019: $2.189 million). Major capital investment
initiatives undertaken during the FY 20 year included replacement
of one liquid fi lling line to improve speed and effi ciency of non-
bleach based liquid products and to target additional private label
business opportunities. As at the reporting date, Pental was in an
advanced stages of commissioning enhancements to its existing
lines to target ethanol-based hand sanitiser products. The demand
for hand sanitisers has increased signifi cantly in recent months due
to the COVID 19 pandemic which is expected to remain stable in
the long term. The Company’s closing net cash position of $3.668
million was debt free. Please refer to note 27 (a) to the fi nancial
statements for details.
IMPACT OF COVID 19
The Group has experienced a healthy uplift in demand for its
strong anti-bacterial cleaning and personal care products since
the start of COVID 19 pandemic. The Group expects that a healthy
level of demand will remain in the market for strong cleaning and
hygiene products.
The Directors believe COVID 19 will not have a material impact on
the Group’s ability to continue as a going concern. The Group is
debt free as at the reporting date with a healthy cash balance of
$3.668 million supported by a banking facility of $5 million.
Whilst there are risks associated with the Group’s raw material
supply chain from other countries, the Directors and management
assess this risk as manageable due to the Group’s reliance on local
sources for a majority of its raw materials. The Group has been
stringently following government issued guidelines to mitigate
risks associated with spread of novel corona virus in the workplace.
HEALTHY DEMAND
FOR STRONG
ANTI-BACTERIAL
ANTI-BACTERIAL
CLEANING AND
PERSONAL CARE
PERSONAL CARE
PRODUCTS
28
29
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
DIRECTORS’ REPORT [CONT]
STRATEGIC OBJECTIVES: THE FIVE KEY PILLARS
Across Australia and New Zealand Pental’s products are stocked in all major grocery retailers and convenience stores that sell personal care and
household cleaning products. Pental’s strategy supports its vision to be a leading supplier of shelf stable (non-food) products to its chosen markets
through delivering quality, innovation and sustainability to the satisfaction of customer needs while enhancing shareholder value.
Our strategy has fi ve pillars; driving sales growth, developing new products, developing new sales channels, growing the export market and
continuous manufacturing improvement. These fi ve pillars support organic growth and are matched by our strategy to establish new partnerships
and distributorships that will complement our product range, expertise, and leverage our infrastructure while expanding into new channels.
This year saw promising progress across the fi ve strategic pillars as outlined here.
1. DRIVING SALES GROWTH
2. DEVELOPING NEW PRODUCTS
3. NEW SALES CHANNELS
4. EXPORT MARKETS
In common with our competitors, we operate in markets which
have changed dramatically in recent years. Brand loyalty has been
eroding by constant discounting which has changed consumers to
make buying decisions based on promotional pricing. Consequently,
shoppers now have as many as four preferred brands, with price
often determining their choice.
Increased retailer margin expectations, especially in supermarket
chains, is resulting in lower gross margin returns for manufacturers
and suppliers. At the same time, major retailers are developing their
own private label brands. It is a challenging market for every brand
and their suppliers, with companies like Pental working hard to
innovate and grow.
We are investing in product innovation, advertising, and fi eld
support to grow our share of shelf space, our market share
and brand equity in key categories. We constantly review the
effectiveness of promotions in driving sales and margins, and
the contribution made by products to overall sales. This enables
us to identify early opportunities for innovation and product
development which support sales growth and differentiate us from
the competition.
We also tender for private label opportunities to complement
revenues from our branded portfolio by manufacturing these
products where it makes commercial sense. Securing third party
accreditation for our manufacturing and supply chain through
ISO9002 and HACCP makes Pental an attractive manufacturing
partner with established credentials.
The combination of a trusted name with an innovative idea
encourages loyal consumers to stay with their preferred
brands while tempting other consumers to switch. Pental’s
commitment to innovation ensures we continue to grow and protect
our brands.
White King’s new range of Australian-made disinfectant
products have been received very positively by our customers
and consumers. This new range is 99.9% effective on germs
which has been a major consumer need since the start of the COVID
19 pandemic.
Pental also developed a range of Country Life branded antibacterial
soaps and hand wash liquids which have performed strongly in the
last quarter of the reported period since the market launch.
Pental has invested in capital to enable the launch of a hand
sanitiser range of products in the second half of 2020. This
new range will complement the hand washing and germ
effective range of products.
The year saw further alignment between Pental’s brands and the
Australian Made Campaign. All new products packaging designs
across the four major brands were updated to include the green
and gold Australian Made logo. The on-pack logo reinforces our
commitment to provide Australian consumers with high quality,
affordable, locally manufactured consumer products.
Our commitment for further growth
includes entering new sales channels.
The year saw Pental’s products being
launched into Bunnings stores for the fi rst
time. Bunnings presents a big opportunity
for Pental to develop and extend its range
of strong brands for a further reach to the
consumers.
Both the White King brand and Country
Life brand were ranged into Aldi for the
fi rst time during the year. This reinforces
the quality and belief behind these iconic
Australian branded products.
During the year we increased the focus
on growing the Pharmacy channel with
outstanding results achieving 100%
growth on the previous year.
Pental’s strong market presence in New
Zealand across several categories continues
to be leveraged to support export growth.
We enjoy a strong partnership with our
Auckland-based sales and distribution
agent. This growth was achieved
through both product innovation and
increased fi eld support at store level.
We are continuing to update the Janola
packaging and the introduction of new
products for the New Zealand market.
China and Vietnam are the other priority
markets for export growth. Pental has
formed strong alliances with distributors
in both markets, The Company is also
exploring opportunities in South Korea
and Indonesia.
5. CONTINUOUS
MANUFACTURING
IMPROVEMENT
Pental’s fi nal strategic pillar is continuous
manufacturing improvement to support
profi table growth through capital investment,
along with cost savings and delivering high
quality, trusted products.
At the Shepparton plant we have focused
on improving productivity and line effi ciency
through labour reduction initiatives and
CAPEX strategies to reduce change over
times, increased line availability and ongoing
preventative maintenance programs.
The installation of a new fi lling line at Pental’s
Shepparton manufacturing site is enabling the
production and development of products that
are more earth friendly and sustainable for
the market.
Pental takes pride in its agility and fl exibility
to scale up as demand levels fl uctuate. As a
result of capital investment and increased
demand this year, increased production is
being achieved in the soap plant, delivering
cost reductions and supporting future growth
of single bar soaps for supply in both local and
export markets.
We have enhanced preventative maintenance
with further development in computerised
maintenance management systems (CMMS)
and predictive tools and technologies.
30
31
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
DIRECTORS’ REPORT [CONT]
▼
Competition
Loss of key personnel
OPERATIONAL RISKS
Pental faces specifi c and general operational risks which may
impact the future operating and fi nancial performance of the
Group. There can be no guarantee that Pental will achieve its
objectives or that forward-looking statements will be realised.
The operating and fi nancial performance is infl uenced by a variety
of general economic and business conditions including levels of
consumer spending, infl ation, interest and exchange rates, and
certain raw material prices.
Following is a summary of the most signifi cant risks facing
continuing business operations, as identifi ed and assessed by a risk
management process carried out by the Audit and Risk Committee
and Pental’s risk mitigation approaches: -
PENTAL IS THE ONLY
MANUFACTURER
OF KEROSENE FREE
FIRELIGHTERS IN
AUSTRALIA
The majority of Pental’s branded products are sold in
supermarkets in Australia and New Zealand. In both countries
competition between retail chains is intense, leading to aggressive
reviews of product mixes as well as increased moves towards own
or private label products to improve retail margins. This situation
is not unique to Pental and affects suppliers of the vast majority
of products stocked across supermarket chains.
New entrants into Pental’s market segment have the potential to
cause market disruption across ours and competitors’ brands as
they bid to secure shelf space. This disruption has the potential
to erode sales. Across the supermarket sector in both countries,
operators are competing for shoppers’ share of wallet through
discounting and private label diversifi cation. The competitive
environment is challenging when suppliers need to recover rising
input costs through prices rises and this impacts margins.
Pental believes it can continue to successfully operate in the fast-
moving consumer goods market through strong product innovation
and managing its product sourcing and manufacturing costs.
Distributorship agreement
Pental currently has a signifi cant distributorship agreement
with Berkshire Hathaway (Duracell brand). As a result, Pental
is the master distributor of Duracell brand for the Australian
market and this agreements account for a material portion of
Pental’s operating margins. These distributorship agreements
are typically renegotiated and renewed every three years and
include provisions that allow the contracts to be terminated on a
performance basis. Pental proactively manages the performance
of its distributorship agreement through joint business plans and
monthly business reviews.
Product sourcing
Pental relies on a range of parties for its product-sourcing
strategy. Any change in existing relationships (including the
termination of any key supply arrangements) or any change in
terms or conditions of overseas/local suppliers and any change in
the political or economic environment may impact performance.
Pental is continually refi ning its sourcing arrangements, including
operating dual sourcing arrangements to mitigate risk.
Supply chain
Pental has an extensive and reliable supply chain that enables
us to effi ciently procure and deliver products to customers.
Disruption to a material aspect of this supply chain could have
a material adverse impact on Pental’s operational and fi nancial
performance. Pental’s ongoing review of supply chain costs and
the corresponding change of supply chain arrangements with
minimal disruption especially through the COVID-19 pandemic
period, shows that Pental can effectively manage this risk.
Pental’s future success depends to a signifi cant extent on the
retention of key personnel, particularly in senior management,
who have extensive market and business knowledge. The
loss of key personnel and the time taken to recruit suitable
replacements or additional personnel could adversely affect the
Company’s future fi nancial performance. The Board reviews the
organisational structure of the business to ensure the best people
are retained, whilst investing in developing other key people in
the business.
Damage to Pental’s brands
The reputation and value associated with Pental’s brand names
could be adversely impacted by various factors including quality
failures, disputes with third parties such as suppliers or customers
or adverse media coverage. Signifi cant erosion in the reputation
of, or value associated with, Pental’s brands could have an adverse
effect on Pental’s future fi nancial performance. Pental believes
that its quality processes and systems, and proactive tracking and
management of any disputes, minimises this risk.
OUTLOOK
The outlook for the Group is contained in the Chairman’s report.
CHANGES IN THE STATE
OF AFFAIRS
During the fi nancial year there were no signifi cant changes in
the state of affairs of the Group, other than as referred to in this
Annual Report.
FUTURE DEVELOPMENTS
Information regarding likely developments in the operations of
the Group in future fi nancial years is set out in the Review of
operations and elsewhere in the Annual Report.
SUBSEQUENT EVENTS
There has not been any matter or circumstance occurring
subsequent to the end of fi nancial year that has signifi cantly
affected, or may affect, the operations of the Group, the results
of those operations, or the state of affairs of the Group in future
fi nancial years.
32
33
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
DIRECTORS’ REPORT [CONT]
DIVIDENDS
In respect of the year (52 weeks) ended 28 June 2020 an interim
fully franked dividend of 0.70 cents per ordinary share was paid
on 25 March 2020 as well as a fully franked special dividend of
0.70 cents per ordinary share was paid on 7 August 2020. The
directors have declared the payment of a fi nal fully franked
dividend of 1.5 cents per ordinary share, payable to shareholders
on 25 September 2020, with a record date of 7 September 2020.
The total dividend for the FY20 fi nancial year of 2.9 cents per
share represents a payout ratio of 78.7% of net profi t after tax.
In the prior year ended 30 June 2019, the total dividend paid was
2.0 cents per ordinary share, representing a payout ratio of 79.0%
of underlying net profi t after tax (i.e. before signifi cant non
cash items).
ENVIRONMENTAL REGULATIONS
The Shepparton manufacturing site is subject to the
Environmental Protection Act 1970, although due to current
practices Pental is not required to have an EPA license.
Pental has a Trade Waste Agreement with Goulburn Valley Water
which stipulates limits on volume and content of our Trade Waste
emissions. Pental proactively monitors the trade waste discharged
from site as part of that Trade Waste Agreement.
Continuous Improvement initiatives focussing on Trade waste
system dilution capital improvements, internal hard waste
segregation management and compliance cleaning programs are
in progress.
Pental continues to be focussed on working with authorities and
waste service providers to implement sustainable solutions.
Environmental performance is reported monthly to the Site
Management Group and the Board.
SHARES UNDER OPTION OR ISSUED ON
EXERCISE OF OPTIONS
There were no unissued shares under options as at the date of
this report.
The Group’s Executive Director (Charlie McLeish) and senior
management were issued performance rights pursuant to
the Executive Variable Incentive Plan (EVIP) as detailed in the
Remuneration Report.
INDEMNIFICATION OF OFFICERS AND
AUDITORS
During the fi nancial year, the company paid a premium in respect
of a contract insuring the directors of the company (as named
above), the company secretary, Oliver Carton, and all executive
offi cers of the company and of any related body corporate against
a liability incurred by such a director, secretary or executive
offi cer to the extent permitted by the Corporations Act 2001.
The contract of insurance prohibits disclosure of the nature of
the liability and the amount of the premium.
The company has not otherwise, during or since the end of the
fi nancial year, except to the extent permitted by law, indemnifi ed
or agreed to indemnify an offi cer or auditor of the company or of
any related body corporate against a liability incurred as such an
offi cer or auditor.
ANNUAL REPORTING CALENDAR
Reporting Requirement
Date
Lodgement of Appendix 4E - FY20:
27 August 2020
FY20 Annual Financial Report
27 August 2020
Deadline for nomination as Director
1 October 2020
Annual Report and Notice of
Annual General Meeting
20 October 2020
Annual General Meeting
19 November 2020
DEAN
HUNTER
“If you love your
job, you never have
to work another
day in your life.”
DIRECTORS’ MEETINGS
The following table sets out the number of directors’ meetings (including meetings of committees of directors) held during the fi nancial
year and the number of meetings attended by each director (while they were a director or committee member). During the fi nancial year,
10 Board, 4 Audit Committee and 2 Remuneration Committee meetings were held.
Directors
Mark Hardgrave
John Etherington
Jeff Miciulis
Fred Harrison (i)
Charlie McLeish (ii)
Peter Robinson (iii)
John Rishworth (iv)
Board of Directors
Audit and Risk Committee
Remuneration Committee
Eligible to
Attend
Attended
Eligible to
Attend
Attended
Eligible to
Attend
Attended
10
10
10
8
3
5
1
10
10
10
8
3
5
1
4
4
4
-
-
2
1
4
4
4
-
-
2
1
2
2
2
2
-
1
-
2
2
2
2
-
1
-
(i) Fred Harrison was appointed as a non-executive director on 28 August 2019
(ii) Charlie McLeish was appointed Managing Director on 6 April 2020.
(iii) Peter Robinson resigned as non-executive chairman on 31 December 2019.
(iv) John Rishworth resigned as non-executive director on 28 August 2019.
NON-AUDIT SERVICES
AUDITOR’S INDEPENDENCE DECLARATION
The auditor’s independence declaration is included on page 52 of
the annual report.
ROUNDING OFF OF AMOUNTS
The Company is a company of a kind referred to in ASIC
Corporations (Rounding in Financial/Directors’ Reports) Instrument
2016/191 dated 24 March 2016, and in accordance with that
Corporations Instrument, amounts in the Directors’ Report and
fi nancial report are rounded off to the nearest hundred thousand
dollars, unless otherwise indicated.
Details of amounts paid or payable to the auditor for non-audit
services provided during the year by the auditor are outlined in
Note 30 to the fi nancial statements.
The directors are satisfi ed that the provision of non-audit services
during the year, by the auditor (or by another person or fi rm on
the auditor’s behalf) is compatible with the general standard of
independence for auditors imposed by the Corporations Act 2001.
The directors are of the opinion that the services as disclosed
in Note 30 to the fi nancial statements do not compromise the
external auditor’s independence, based on advice received from
the Audit Committee, for the following reasons:
■ all non-audit services have been reviewed and approved to
ensure that they do not impact the integrity and objectivity of
the auditor, and
■ none of the services undermine the general principles relating
to auditor independence as set out in Code of Conduct APES
110 Code of Ethics for Professional Accountants issued by the
Accounting Professional & Ethical Standards Board, including
reviewing or auditing the auditor’s own work, acting in a
management or decision-making capacity for the company,
acting as advocate for the company or jointly sharing economic
risks and rewards.
34
35
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
REMUNERATION
REPORT - AUDITED
The directors and other members
of key management personnel of
the Group during the year were:
MARK
HARDGRAVE
Non-Executive
Independent Chairman
appointed on 31 December 2019,
non-executive independent director
until 31 December 2019.
JOHN
ETHERINGTON
Non-executive
Independent Director
FRED HARRISON
Non-executive
Independent Director
(commencement date,
28 August 2019)
CHARLIE MCLEISH
Managing Director
appointed on 6 April 2020,
Chief Executive Offi cer
until 6 April 2020
JEFF MICIULIS
Non-executive
Independent Director
NEIL GODARA
Chief Financial Offi cer
RETIRED DIRECTORS
PETER ROBINSON
Non-executive
Independent Chairman
(resignation date, 31 December 2019)
JOHN RISHWORTH
Non-executive
Independent Director
(resignation date, 28 August 2019)
THIS REMUNERATION REPORT DETAILS THE
NATURE AND AMOUNT OF REMUNERATION FOR
EACH DIRECTOR AND SENIOR MANAGEMENT
PERSONNEL OF PENTAL LIMITED.
REMUNERATION POLICY
KEY TERMS OF EMPLOYMENT CONTRACTS
Mr Charlie McLeish is employed by the Group under an ongoing
contract. The period of notice required by the Group to terminate
the contract is twelve months without cause and the notice
required by Mr McLeish is four months. Mr McLeish is entitled to
participate in the Executive Variable Incentive Plan (EVIP) which
contains short term cash bonuses as well as performance rights
that vest at a future date in 3 years. Eligibility criteria for EVIP is
aligned to the Company’s performance.
Mr Neil Godara is employed by the Group under an ongoing
contract which may be terminated on one months’ notice by
either the Company or the executive. Mr Godara is entitled to
participate in the Executive Variable Incentive Plan (EVIP) which
contains short term cash bonuses as well as performance rights
that vest at a future date in 3 years. Eligibility criteria for EVIP is
aligned to the Company’s performance.
RELATIONSHIP BETWEEN THE
REMUNERATION POLICY AND
COMPANY PERFORMANCE
The remuneration policy has been tailored to increase goal
congruence between shareholders and executives. This has been
achieved through structuring executive remuneration with a
combination of total fi xed remuneration and a performance-
based incentive system controlled through Executive Variable
Incentive Plan (EVIP). Details of EVIP are provided within the
remuneration report.
Fees for non-executive directors are not linked to the performance
of the Group.
The remuneration policy of Pental Limited has been designed to
align executive objectives with shareholder and business objectives
by providing a fi xed remuneration component and offering
variable cash and equity incentives based upon key performance
areas affecting the Group’s fi nancial results. The Board of Pental
Limited believes the remuneration policy to be appropriate and
effective in its ability to attract and retain the best executives to
run and manage the Group, as well as create goal congruence
between executives and shareholders.
The Board’s policy for determining the nature and amount of
remuneration for board members and senior executives of the
Group is as follows:
The remuneration policy, setting the terms and conditions for
the Managing Director and other senior executives (executives),
was developed and approved by the Board. Executive packages
are reviewed annually by reference to the Group’s performance,
executive performance and comparable information from industry
sectors and other listed companies in similar industries. The
performance of executives is measured regularly against agreed
criteria and is based predominantly on the forecast growth of
the Group’s profi ts and shareholders’ value. All bonuses and
incentives are linked to predetermined operational and fi nancial
performance criteria. Executives are also entitled to participate in
an Executive Variable Incentive Plan (EVIP).
The executives receive a superannuation guarantee contribution
required by the law, and do not receive any other retirement
benefi ts. Some individuals, however, may choose to sacrifi ce part
of their salary to increase payments towards superannuation.
The Board policy is to remunerate non-executive directors at
market rates for comparable companies for time, commitment
and responsibilities. The Board determines payments to the
non-executive directors and reviews their remuneration
annually, based on market practice, duties and accountability.
The maximum aggregate amount of fees that can be paid to
non-executive directors is subject to approval by shareholders at
the Annual General Meeting. The maximum aggregate amount
of fees that can be paid to non-executive directors as per last
approval is $0.750 million. Fees for non-executive directors are
not linked to the performance of the Group. No shares or options
have been issued to non-executive directors, under the EVIP or an
option scheme, within the last fi ve years.
36
37
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
28 June
2020
30 June
20191
1 July
20181
2 July
20171
26 June
20161
2020
REMUNERATION REPORT - AUDITED [CONT]
The following tables set out summary information about the Group’s earnings and movements in shareholder wealth for the fi ve years to
June 2020. It has been the focus of the Board of Directors to retain management personnel essential to the profi table operations of the
Group, and to attract suitable executives.
Gross sales
Net profi t/(loss) before tax
Net profi t/(loss) after tax
Underlying net profi t after tax
$’000
$’000
$’000
$’000
$’000
188,994
153,986
108,427
117,660
109,980
7,221
5,019
5,019
2,756
1,921
3,451
(26,824)
(27,839)
2,602
8,343
5,850
5,962
8,218
5,628
5,628
1 Underlying net profi t after tax has been adjusted to exclude brand impairment for FY19: $2,185 thousand, goodwill impairment for FY18: $29,446 thousand, ACCC penalty for FY18: $700
thousand, ACCC legal costs for FY18: $421 thousand & FY17: $160 thousand, and their respective income tax impact (FY19: $655 thousand, FY18: $126 thousand, FY17: $48 thousand).
Share price at start of year
Share price at end of year
Interim dividend (cents) per share 1
Special dividend (cents) per share 1, 2
Final dividend (cents) per share 1, 2
Basic earnings/(loss) cents per share
Diluted earnings/(loss) cents per share
1 Franked to 100% at 30% corporate income tax rate.
2 Declared after the balance date and not refl ected in the fi nancial statements of that year.
28 June
2020
30 June
2019
$’000
$0.288
$0.34
0.70
0.70
1.50
3.68
3.64
$’000
$0.280
$0.288
0.70
-
1.30
1.41
1.41
1 July
2018
$’000
$0.595
$0.280
0.60
-
0.90
(20.43)
(20.43)
2 July
2017
26 June
2016
$’000
$0.575
$0.595
1.15
-
2.10
4.29
4.18
$’000
$0.440
$0.575
1.00
-
1.95
4.13
4.04
The compensation of each member of the key management personnel of the Group for the current year is set out below:
Short-term employee benefi ts
Post-
employment
benefi ts
Share–based
payments
Salary
& fees
$
Bonus
$
Non-
Monetary(vi)
$
Superannuation
$
Rights
$
Total
$
Non Executive
Directors
Mark Hardgrave (i)
John Etherington
Jeff Miciulis
Fred Harrison (ii)
Peter Robinson (iii)
John Rishworth (iv)
Total Directors
Executives
82,192
63,927
63,927
60,883
45,662
9,132
325,723
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Charlie McLeish (v)
475,004
175,000
Neil Godara
198,630
43,500
Total Executives
673,634
218,500
Total Remuneration
999,357
218,500
6,198
7,522
13,720
13,720
(i) Mark Hardgrave was appointed non-executive chairman on 31 December 2019.
(ii) Fred Harrison was appointed non-executive director on 28 August 2019.
(iii) Peter Robinson retired as non-executive chairman on 31 December 2019.
(iv) John Rishworth resigned as non-executive director on 28 August 2019.
(v) Charlie McLeish was appointed as managing director on 6 April 2020. He was Chief Executive Offi cer until that date.
(vi) Non-monetary benefi ts include car parking & motor vehicle toll tags.
7,808
6,073
6,073
5,784
4,338
868
30,944
24,996
18,870
43,866
74,810
-
-
-
-
-
-
-
90,000
70,000
70,000
66,667
50,000
10,000
356,667
27,229
708,427
8,864
277,386
36,093
985,813
36,093
1,342,480
PETER
WOODS
“Pentals core values,
respect, quality &
putting safety fi rst
are number 1”
38
39
▼
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
REMUNERATION REPORT - AUDITED [CONT]
The compensation of each member of the key management personnel of the Group for the prior year is set out below:
Short-term employee benefi ts
Post-
employment
benefi ts
Termination
benefi ts
Share–based
payments
Salary
& fees
$
Bonus(x)
$
Non-
Monetary(i)
$
Superannuation
$
Lump Sum(Viii)
$
Rights(ix)
$
Total
$
2019
Non Executive
Directors
Peter Robinson
John Rishworth
John Etherington
Jeff Miciulis(ii)
Mark Hardgrave(iii)
Mel Sutton(iv)
Kimberlee Wells(v)
Total Directors
Executives
91,324
54,795
54,795
18,265
9,132
36,529
45,000
309,840
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Charlie McLeish
421,692
40,000
Neil Godara (vi)
115,041
10,000
Josephine De
Martino(vii)
67,308
-
6,492
3,002
3,164
Total Executives
604,041
50,000
12,658
Total Remuneration
913,881
50,000
12,658
(i) Non-monetary benefi ts include car parking & motor vehicle toll tags.
(ii) Jeff Miciulis was appointed non-executive director on 5 March 2019.
(iii) Mark Hardgrave was appointed non-executive director on 1 May 2019.
(iv) Mel Sutton resigned as non-executive vice chairman on 31 December 2018.
(v) Kimberlee Wells resigned as non-executive director on 21 March 2019.
(vi) Neil Godara was appointed as Chief Financial Offi cer on 10 October 2018.
(vii) Josephine De Martino resigned as Chief Financial Offi cer on 5 October 2018.
(viii) Lump sum includes payment of balance of accrued leave entitlements paid out on termination and applicable superannuation.
(ix) Performance rights issued to Mr McLeish in prior periods are deemed unlikely to vest.
(x) The remuneration committee approved a one time special cash bonus for Mr McLeish and Mr Godara on 20 June 2019.
8,676
5,205
5,205
1,735
868
3,470
-
25,159
24,996
10,929
6,394
42,319
67,478
-
-
-
-
-
-
-
-
-
-
8,205
8,205
8,205
-
-
-
-
-
-
-
-
100,000
60,000
60,000
20,000
10,000
39,999
45,000
334,999
(56,992)
436,188
-
-
(56,992)
(56,992)
138,972
85,071
660,231
995,230
TRANSACTIONS WITH KEY MANAGEMENT
PERSONNEL
As disclosed in information about the Directors, Mr Fred Harrison
is the CEO of Ritchies. Mr Harrison’s employer, Ritchies Stores Pty
Ltd invoiced the Group a total of $236,351.88 (including GST)
relating to the Group’s participation in various promotional
activities and supplier trading terms during the fi nancial year. All
transactions were conducted at arm’s length. As at the reporting
date, the Group owed Ritchies Stores Pty Ltd $36,300 in relation
to above mentioned promotional activities and supplier
trading terms.
Mr Peter Robinson was paid a total of $19,000 (including GST) in
relation to consultancy services provided to the Group after his
retirement on 31 December. A party related to Mr Robinson was
employed by the Group during the reported period. The terms of
employment were at arm’s length. The related party was paid a
remuneration of $131,058 during the period.
Mr John Rishworth was paid a total of $17,600 (including GST)
in relation to consultancy services provided to the group after
his retirement date. A party related to Mr Rishworth was also
employed by the Group during the reported period. The terms of
employment were at arm’s length. The related party was paid a
remuneration of $15,006 during the period.
EXECUTIVE VARIABLE INCENTIVE PLAN
(EVIP)
Under Pental’s EVIP, executives and selected senior management
employees are eligible for both a cash and equity incentive upon
the achievement of certain Group level KPI’s and personal KPIs set
at the commencement of each fi nancial year, weighted as follows:
■ Fifty percent of both the cash and equity incentive KPIs relate to
the achievement of a target EBIT for the fi nancial year.
■ The remaining fi fty percent are based on specifi c KPIs relevant
to the participant’s particular specialisation.
VARIABLE INCENTIVE – EQUITY
The variable equity incentive is designed to reward achievement
of annual KPIs, assist the retention of key high performing
executives and align the rewards to the company’s share price.
The maximum amount of remuneration under the variable
equity incentive plan varies from 30 to 40 percent of the
individual executive / senior management employee’s total
fi xed remuneration. The variable equity incentive is delivered
as Performance Rights (Rights), which are granted under the
existing Executive Performance Rights Plan (Rights Plan) to
enable the subsequent acquisition of the share component. The
Rights will convert to ordinary shares after three years from the
end of fi nancial year of the grant date. Rights will be granted
on a face value basis using the last ten business days of the
previous fi nancial year Volume Weighted Average Price (VWAP).
The variable equity incentive is based upon an assessment of
performance against respective KPIs in the year in which it is
granted. If the performance criteria is not met within the fi nancial
year, the Rights lapse at the end of the same fi nancial year.
The vesting of the Rights is conditional on:
a) The executive satisfying Group level and personal performance
criteria,
b) the executive being employed by the Group on the vesting
date; and
c) Pental’s VWAP share price for the last ten business days
preceding the vesting date being equal to or greater than the
VWAP for the preceding ten business days from the grant date.
In total, the Rights are held for four years from the grant date.
The value to the executive therefore is not at the grant date,
rather at the vesting date which is three years from the end of
fi nancial year of the grant date.
Dividends are not payable on the Rights. Dividends are payable on
ordinary shares after conversion of the Rights to ordinary shares.
Under the EVIP, the executives can receive the following
annualised remuneration from the vesting of the Rights:
VARIABLE INCENTIVE – CASH
Variable cash incentive under EVIP is paid shortly after the
release of audited full year results. The maximum amount of
remuneration under the variable cash incentive plan ranges from
20 to 35 percent of the individual executive / senior management
employee’s total fi xed remuneration.
Percentage of total fi xed
remuneration:
Charlie McLeish
Up to 40%
Neil Godara
Up to 30%
40
41
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
REMUNERATION REPORT - AUDITED [CONT]
EVIP – FY20 PERFORMANCE
The following table contains details of EVIP entitlements achieved by the executive team during the year:
2020
% of EVIP
achieved
EVIP – cash
component
$
EVIP – Equity
component
$
VWAP(i) used to
calculate number
of Rights
$
Number of Rights
issued(ii)
SHARE-BASED PAYMENTS (RIGHTS PLAN)
All performance rights under the EVIP are issued pursuant to the Executive Performance Rights Plan (Rights Plan). Under the conditions of
Rights Plan, performance Rights are convertible to ordinary shares (with no exercise price) as at the vesting date which is 4 years from the
grant date (or 3 years from the end of the fi nancial year)
All Rights issued are convertible to ordinary shares at no consideration, subject to achieving any performance or other vesting conditions.
The following table discloses changes in the performance rights holdings of management personnel:
Grant
Date
Vesting
Date
Balance at
1/7/2019
No.
Rights
granted
No.
Rights
vested
No.
Rights
forfeited
No.
Rights
lapsed
No.
Balance at
28/6/2020
No.
Charlie McLeish(i)
3/7/2017
1/7/2020
211,765
-
Charlie McLeish
1/7/2019
1/7/2023
Neil Godara
1/7/2019
1/7/2023
-
-
685,000
223,000
-
-
-
-
-
-
211,765
-
-
-
685,000
223,000
(i) Rights granted to Mr McLeish on 3 July 2017 lapsed during the period as a result of the related performance conditions not being achieved.
No Rights or share options were granted in the previous comparative period.
Executives
Charlie McLeish
Neil Godara
100%
100%
175,000
43,500
218,500
200,000
65,250
265,250
0.2921
0.2921
685,000
223,000
908,000
KEY MANAGEMENT PERSONNEL EQUITY HOLDINGS
Fully paid ordinary shares of Pental Limited held by key management personnel including a close member of family or an entity that is
controlled or signifi cantly infl uenced are as per below:
(i) Volume Weighted Average Price (VWAP) based on closing share price of last 10 business days of fi nancial year 2019 and volume traded on each day in that period. Source –
Commonwealth Securities Limited.
(ii) Number of Rights have been rounded to nearest thousand.
No cash or equity incentives were achieved by the executives or senior management employees in the previous fi nancial year under the EVIP
as the Company did not achieve the plan’s EBIT hurdles.
The fair value of the Rights granted is measured using Monte Carlo method. The following table contains relevant inputs to measure the fair
value of the Rights as at grant date:
No. of
Rights
granted
Share price
at grant
date(i)
Exercise
price
Expected
volatility
Risk
free
rate
Expected
dividend
yield
Fair value
per Right
at grant
date
Fair value
of Rights at
grant date
Executives
Charlie McLeish
685,000
$0.2921
Neil Godara
223,000
$0.2921
Nil
Nil
45.95%
0.94%
5.52%
$0.159
$108,915
45.95%
0.94%
5.52%
$0.159
$35,457
(i) Volume Weighted Average Price (VWAP) based on closing share price of last 10 business days of fi nancial year 2019 and volume traded on each day in that period. Source –
Commonwealth Securities Limited.
For squeaky clean dishes
with antibacterial protection
Antibacterial protection
Removes oil and grease fast
Powerful lemon fragrance
Biodegradable*
Balance
at
1/7/2018
Options
exercised
Net change
other (i)
Balance
at
30/6/2019
Options
exercised
Net change
other (i)
Balance(v)
at
28/6/2020
Non-Executive
Directors
Mark Hardgrave
Fred Harrison(ii)
-
-
John Etherington
160,000
Jeff Miciulis
-
Peter Robinson(iii)
4,210,927
John Rishworth(iii)
13,208
Executives
Charlie McLeish(iv)
Neil Godara(iv)
3,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
160,000
800,000
800,000
-
-
4,210,927
13,208
11,500
14,500
-
-
-
-
-
-
-
-
-
-
100,000
100,000
250,000
250,000
-
-
160,000
800,000
(4,210,927)
(13,208)
-
-
-
-
14,500
-
(i) Net change other relates to shares purchased and sold during the fi nancial year.
(ii) Fred Harrison was appointed non-executive director on 28 August 2019.
(iii) Mr Robinson and Mr Rishworth retired as directors during the fi nancial year.
(iv) Both Mr McLeish and Mr Godara have been issued performance rights under the Executive Variable Incentive Plan (EVIP).
(v) There has been no change in shareholdings from the end of the fi nancial year to the date of this report.
KEY MANAGEMENT PERSONNEL SHARE OPTION HOLDINGS
Other than the performance rights holdings disclosed on this page, no share options are on issue as at the date of this report.
This directors’ report is signed in accordance with a resolution of directors made pursuant to s.298 (2) of the Corporations Act 2001.
On behalf of the Directors
Mark Hardgrave
Chairman
Melbourne, 27 August 2020
42
43
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
CORPORATE
GOVERNANCE
STATEMENT
THIS CORPORATE GOVERNANCE STATEMENT
SETS OUT THE COMPANY’S CURRENT
COMPLIANCE WITH THE ASX CORPORATE
GOVERNANCE COUNCIL’S PRINCIPLES OF
GOOD CORPORATE GOVERNANCE AND
(BEST PRACTICE RECOMMENDATIONS BEST
PRACTICE RECOMMENDATIONS).
The Company’s website www.pental.com.au contains an Investor
Section, which details the Company’s Corporate Governance policies and
procedures. This provides public access to all the information relevant to
the Company meeting its corporate governance obligations.
1.
1.1
BEST PRACTICE RECOMMENDATION
COMMENT
Lay solid foundations for management and oversight
A listed entity should disclose:
(a) the respective roles and responsibilities
of its board and management; and
The Corporate Governance Policies include a Board Charter, which
discloses the specific responsibilities of the Board and provides that the
Board shall delegate responsibility for the day-to-day operations and
administration of the Company to the Managing Director.
(b) those matters expressly reserved to the board
and those delegated to management.
The responsibilities of the Board, which are reserved for the Board and
not delegated to management, include:
BEST PRACTICE RECOMMENDATION
COMMENT
1.3
1.4
A listed entity should have a written agreement with
each director and senior executive setting out the
terms of their appointment.
The Company has a written agreement with each director and senior
executive setting out the terms of their appointment.
The company secretary of a listed entity should be
accountable directly to the board, through the chair, on
all matters to do with the proper functioning of
the board.
The company secretary is accountable directly to the board, through the
chair, on all matters to do with the proper functioning of the board. The
current company secretary is a long-standing appointee and has direct
contact with all directors as and when required.
■ Oversight of the business and affairs of the Company;
■ Establishment of control and accountability systems;
■ Establishment with management of a strategic direction, supporting
strategies and operating performance objectives;
■ Appointing the Managing Director and any other Executive Director;
and
■ Reviewing and ratifying systems of risk management and internal
compliance and control, codes of conduct and legal compliance.
The Board Charter is available on the Company’s website.
1.2
A listed entity should:
(a) undertake appropriate checks before
appointing a person, or putting forward to
security holders a candidate for election, as a
director; and
(b) provide security holders with all material
information in its possession relevant to a
decision on whether or not to elect or re-elect
a director.
The Board has not established a Nominations Committee given the
size of the Board and the Company’s operations. The Board as a
whole performs the role of selection of potential new directors, and
appropriate checks are made before an appointment occurs.
The Company provides security holders with all material information
in its possession concerning the appointment or re-appointment
of a director in the Notice of Shareholder Meeting concerning that
appointment or re-appointment. A recommendation of the Directors
concerning that appointment or re-appointment is also given.
LACHLAN
KERR
“I enjoy working at Pental,
a company that produces
product that benefi ts not
only the company, but also
Australia and the public”
1.5
A listed entity should:
(a) have a diversity policy which includes requirements
for the board or a relevant committee of the board
to set measurable objectives for achieving gender
diversity and to assess annually both the objectives
and the entity’s progress in achieving them;
(b) disclose that policy or a summary of it; and
(c) disclose as at the end of each reporting period the
measurable objectives for achieving gender diversity
set by the board or a relevant committee of the
board in accordance with the entity’s diversity policy
and its progress towards achieving them and either:
(1) the respective proportions of men and women
on the board, in senior executive positions and
across the whole organisation (including how the
entity has defined “senior executive” for these
purposes); or
(2) if the entity is a “relevant employer” under the
Workplace Gender Equality Act, the entity’s
most recent “Gender Equality Indicators”, as
defined in and published under that Act.
1.6
A listed entity should:
(a) have and disclose a process for periodically
evaluating the performance of the board, its
committees and individual directors; and
(b) disclose, in relation to each reporting period,
whether a performance evaluation was undertaken
in the reporting period in accordance with that
process.
The Company does not have a specific policy or measurable objectives
for achieving gender diversity. The Board believes the existing Code of
Conduct anti-discrimination provisions provides for this. The Company
does not believe it is appropriate to establish a quota system for
measuring gender diversity, and indeed such a quota system could itself
lead to discrimination.
As a “relevant employer” under the Workplace Gender Equality Act, the
company is compliant with the minimum requirements of the act and
intends to take appropriate action should it be of the view that there is
insufficient gender diversity within the business.
As at 28 June 2020, there were 36 (30 June 2019, 34) women employed
representing 24.49% (30 June 2019, 26.0%) of total employees.
There were no female senior executives as at the reporting date
(30 June 2019: None).
There was no female on the Board of Directors (30 June 2019, None).
The Company’s Corporate Governance Section on its website includes
the Company’ 2020 Workplace Gender Equality public report and the
corresponding compliance notice issued to the company on the 22nd
July 2020.
The Company does not have a formal policy for the periodic evaluation
of it Board. The Board does not consider that a formal policy is
necessary given the size of the Board and operations of
the Company.
1.7
A listed entity should:
(a) have and disclose a process for periodically
evaluating the performance of its senior executives;
and
(b) disclose, in relation to each reporting period, whether
a performance evaluation was undertaken in the
reporting period in accordance with that process.
The Board is responsible for assessing the performance of the Chief
Executive Officer. The Chief Executive Officer is responsible for
assessing the performance of all executives within the Company, in
conjunction with the Board.
Key performance indicators are set annually, and appraisals are
conducted at least biannually for all Pental employees.
A performance evaluation for the CEO and all executives has taken
place during the year under the process disclosed.
44
45
▼
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
CORPORATE GOVERNANCE STATEMENT [CONT]
BEST PRACTICE RECOMMENDATION
COMMENT
The Board has not established a Nominations Committee.
The Board as a whole carries out the functions of a
Nominations Committee, and Pental believes this is
appropriate for a Company of its size and business. The
Board seeks to ensure that it has an appropriate mix of skills
necessary to fulfill its obligations.
2.
2.1
Structure the board to add value
The board of a listed entity should:
(a) have a nomination committee which:
(1) has at least three members, a majority of
whom are independent directors; and
(2) is chaired by an independent director,
and disclose:
(3) the charter of the committee;
(4) the members of the committee; and
(5) as at the end of each reporting period, the
number of times the committee met throughout
the period and the individual attendances of
the members at those meetings; or
(b) if it does not have a nomination committee,
disclose that fact and the processes it employs
to address board succession issues and to ensure
that the board has the appropriate balance of
skills, knowledge, experience, independence and
diversity to enable it to discharge its duties and
responsibilities effectively.
2.2
A listed entity should have and disclose a board skills
matrix setting out the mix of skills and diversity that the
board currently has or is looking to achieve in
its membership.
Pental does not have a board skills matrix. The names and
details of Directors in office at the date of this Annual Report,
including skills, experience, term of office and expertise, are
included in the Directors’ Report Section of this Annual Report.
2.3
A listed entity should disclose:
(a) the names of the directors considered by the board
to be independent directors;
(b) if a director has an interest, position, association or
relationship of the type described in Box 2.3 but the
board is of the opinion that it does not compromise
the independence of the director, the nature of
the interest, position, association or relationship in
question and an explanation of why the board is of
that opinion; and
(c) the length of service of each director.
Directors of Pental are considered to be independent when
they are independent of management and free from any
business or other relationship that could materially interfere
with the exercise of their independent judgment. The following
Directors are considered to be Independent: Mr Peter
Robinson, Mr John Rishworth, Ms Kimberlee Wells, Mr John
Etherington, Mr Jeff Miciulis and Mr Mark Hardgrave.
Mr Mel Sutton is not considered to meet the test of
independence as he has provided material consultancy
services to the Group during the previous three years.
Ms Wells is considered to be independent despite the fact that
her employer TBWA Group invoiced services valued at $1,975
during the period (2018: $81,840), as the value of service is
not material to Ms Wells as an employee of TBWA Group, or
Pental.
The date of appointment and resignation of each Director is
set out in the Directors’ Report Section of this Annual Report.
A majority of the board of a listed entity should be
independent directors.
At the date of this report and during the period a majority of
directors were independent directors.
The chair of the board of a listed entity should be an
independent director and, in particular, should not be
the same person as the CEO of the entity.
The Chairman is an independent director. The Chief Executive
Officer is not the Chairman.
A listed entity should have a program for inducting
new directors and provide appropriate professional
development opportunities for directors to develop
and maintain the skills and knowledge needed to
perform their role as directors effectively.
The Company has an induction program for new directors.
The Company does not provide professional development
opportunities for Directors. Given the current skill sets of
each Director the Board considers that this is unnecessary.
2.4
2.5
2.6
46
PROTECTION
FOR THE
WHOLE
FAMILY
NEW
Infused with essential oils,
The Australian Country Life’s
Antibacterial hand wash
provides protection for the
whole family.
47
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
CORPORATE GOVERNANCE STATEMENT [CONT]
BEST PRACTICE RECOMMENDATION
COMMENT
BEST PRACTICE RECOMMENDATION
COMMENT
3.
3.1
Instil a culture of acting lawfully, ethically and responsibly
A listed entity should articulate and disclose its values
3.2
A listed entity should:
(a) have a code of conduct for its directors, senior executives
and employees; and
(b) disclose that code or a summary of it.
3.3
A listed entity should:
(a) have and disclose a whistle-blower policy; and
(b) ensure that the board or a committee of the board is
informed of any material incidents reported under that policy
3.4
A listed entity should:
(a) have and disclose an anti-bribery and corruption policy;
and
(b) ensure that the board or a committee of the board is
informed of any material breaches of that policy.
Pental is dedicated to delivering quality, expertise and
value in everything we make. Our products are designed
to help families live better. Ours are trusted and loved
brands that have been a part of Australians’ lives for
generations. We always act with dignity and respect.
The Company has a formal Code of Conduct, which
applies to all Pental directors, employees, and
contractors. A summary of this policy is available on the
Company website within the Corporate Governance
Section.
The Company’s Corporate Governance Section includes
the Securities Trading Policy, which regulates dealings by
directors, officers and employees in securities issued by
the Company.
The Company has a Whistle-blower Policy. The Policy,
which encourages reporting of unethical, corrupt and
illegal practices, and any breach of Pental’s Code of
Conduct, particularly concerning compliance concerns
around the Competition and Consumer Act; the
Australian Consumer Law, is also available on the
company website within the Corporate Governance
Section.
The Company’s Corporate Governance Section on its
website includes a whisteblower policy
Any material incidents are encouraged to be reported
to the company secretary who reports to the board in a
timely manner.
The Company’s Corporate Governance Section on its
website includes an anti-bribery and corruption policy.
Any material incidents are encouraged to be reported
to the company secretary who reports to the board in a
timely manner.
4.
4.1
Safeguard integrity in fi nancial reporting
The board of a listed entity should:
(a) have an audit committee which:
(1) has at least three members, all of whom are non-
executive directors and a majority of whom are
independent directors; and
(2) is chaired by an independent director, who is not
the chair of the board,
and disclose:
(3) the charter of the committee;
(4) the relevant qualifications and experience of the
members of the committee; and
(5) in relation to each reporting period, the number of
times the committee met throughout the period and
the individual attendances of the members at those
meetings; or
(b) if it does not have an audit committee, disclose that fact
and the processes it employs that independently verify
and safeguard the integrity of its corporate reporting,
including the processes for the appointment and removal
of the external auditor and the rotation of the audit
engagement partner.
The board of a listed entity should, before it approves the
entity’s financial statements for a financial period, receive
from its CEO and CFO a declaration that, in their opinion,
the financial records of the entity have been properly
maintained and that the financial statements comply with
the appropriate accounting standards and give a true and
fair view of the financial position and performance of the
entity and that the opinion has been formed on the basis
of a sound system of risk management and internal control
which is operating effectively.
The Board has an Audit and Risk Committee. The Audit
and Risk Committee consisted of between four and five
members, the majority of whom are
independent directors.
The Chair of the Committee was and is not the Chair
of the Board during the period.
The names of the members of the Committee, details
of their qualifications and experience and details of the
number of meetings held during the period, are contained
in the Directors’ Report section of this
Annual Report.
The Audit and Risk Committee operates under a Charter
which is available on the Company website within the
Corporate Governance Section.
The Board has obtained the relevant assurances
from management.
A listed entity should disclose its process to verify the integrity
of any periodic corporate report it releases to the market that
is not audited or reviewed by an external auditor.
The external auditor attends its AGM and is available
to answer questions from security holders relevant to
the audit.
Make timely and balanced disclosure
A listed entity should:
(a) have a written policy for complying with its continuous
disclosure obligations under the Listing Rules; and
(b) disclose that policy or a summary of it.
A listed entity should ensure that its board receives copies
of all material market announcements promptly after they
have been made
A listed entity that gives a new and substantive investor
or analyst presentation should release a copy of the
presentation materials on the ASX Market Announcements
Platform ahead of the presentation.
The Company has in place a Continuous Disclosure
Policy, which has been implemented across the Company.
The Policy is available on the Corporate Governance
section of the Company website.
The Directors are notified of all material announcements
promptly.
The Company is compliant with this recommendation.
4.2
4.3
5.
5.1
5.2
5.3
48
49
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
CORPORATE GOVERNANCE STATEMENT [CONT]
BEST PRACTICE RECOMMENDATION
COMMENT
BEST PRACTICE RECOMMENDATION
COMMENT
Respect the rights of shareholders
A listed entity should provide information about itself and its
governance to investors via its website.
A listed entity should design and implement an investor
relations program to facilitate effective two-way
communication with investors.
A listed entity should disclose the policies and processes
it has in place to facilitate and encourage participation at
meetings of security holders.
The Company provides information about itself and
its governance on its website. All policies and charters
concerning governance issues are located within a
dedicated section headed Corporate Governance.
The Company has in place a Shareholder Communication
Policy, which promotes effective communication with
shareholders. The Policy is available on the Corporate
Governance section of the Company website.
The Company has in place a Shareholder Communication
Policy, which promotes effective communication with
shareholders. The Policy is available on the Corporate
Governance section of the Company website.
A listed entity should give security holders the option to
receive communications from, and send communications to,
the entity and its security registry electronically.
The Company gives security holders the option to receive
communications from, and send communications to, the
entity and its security registry electronically.
A listed entity should give security holders the option to
receive communications from, and send communications to,
the entity and its security registry electronically.
The Company gives security holders the option to receive
communications from, and send communications to, the
entity and its security registry electronically.
The Audit Committee referred to in section 4 also oversees
risk as part of its Charter.
Recognise and manage risk
The board of a listed entity should:
(a) have a committee or committees to oversee risk,
each of which:
(1) has at least three members, a majority of whom
are independent directors; and
(2) is chaired by an independent director,
and disclose:
(3) the charter of the committee;
(4) the members of the committee; and
(5) as at the end of each reporting period, the number
of times the committee met throughout the period and
of times the committee met throughout the period and
the individual attendances of the members at those
meetings; or
(b) if it does not have a risk committee or committees
that satisfy (a) above, disclose that fact and the
processes it employs for overseeing the entity’s risk
management framework.
6.
6.1
6.2
6.3
6.4
6.5
7.
7.1
50
7.2
The board or a committee of the board should:
(a) review the entity’s risk management framework at least
annually to satisfy itself that it continues to be sound;
and
(b) disclose, in relation to each reporting period, whether
such a review has taken place.
7.3
A listed entity should disclose:
(a) if it has an internal audit function, how the function is
structured and what role it performs; or
(b) if it does not have an internal audit function, that
fact and the processes it employs for evaluating and
continually improving the effectiveness of its risk
management and internal control processes.
The Audit and Risk Committee reviews the Company’s
risk management framework annually and specific risks
at each meeting. Key risks are referred to the Board
periodically, and management reports on whether risk is
being effectively managed.
The Company does not have an internal audit function.
The Board considers that this is unnecessary given the
size of the Company’s operations.
The Audit and Risk Committee reviews the Company’s
risk management framework and risks generally. Where
necessary the Company has requested external advisors
to review particular operations to ensure internal controls
are effective.
7.4
8.
8.1
A listed entity should disclose whether it has any
material exposure to economic, environmental and social
sustainability risks and, if it does, how it manages or intends
to manage those risks.
The Company does not have any economic,
environmental and social sustainability risks over and
above those of every commercial organisation, and not
already disclosed to security holders.
The Board has established a Remuneration Committee.
The Remuneration Committee operates under a Charter,
which is available on the Company’s website.
Memberships of the Committee, and details of meetings
held during the period, are contained in the Directors’
Report section.
Remunerate fairly and responsibly
The board of a listed entity should:
(a) have a remuneration committee which:
(1) has at least three members, a majority of whom are
independent directors; and
(2) is chaired by an independent director,
and disclose:
(3) the charter of the committee;
(4) the members of the committee; and
(5) as at the end of each reporting period, the number of
times the committee met throughout the period and
the individual attendances of the members at those
meetings; or
(b) if it does not have a remuneration committee, disclose
that fact and the processes it employs for setting the
level and composition of remuneration for directors and
senior executives and ensuring that such remuneration is
appropriate and not excessive.
8.2
A listed entity should separately disclose its policies and
practices regarding the remuneration of non-executive
directors and the remuneration of executive directors and
other senior executives.
8.3
A listed entity which has an equity-based remuneration
scheme should:
(a) have a policy on whether participants are permitted
to enter into transactions (whether through the use of
derivatives or otherwise) which limit the economic risk of
participating in the scheme; and
(b) disclose that policy or a summary of it.
Remuneration policies are set out in the Remuneration
Report section of this Annual Report.
When thought desirable the Board utilises specialist
third parties to benchmark executive and non-executive
director remuneration.
The Company has established an Executive Performance
Rights Plan that may result in the issue of securities to
executives. As those securities will be ordinary shares
there is no policy on permitting participants to enter into
transactions limiting the risk of participation in
the scheme.
51
Deloitte Touche Tohmatsu
ABN 74 490 121 060
477 Collins Street
Melbourne, VIC, 3000
Australia
Phone: +61 3 9671 7000
www.deloitte.com.au
Deloitte Touche Tohmatsu
ABN 74 490 121 060
477 Collins Street
Melbourne, VIC, 3000
Australia
Phone: +61 3 9671 7000
www.deloitte.com.au
Board of Directors
Pental Limited
Level 6, 390 St Kilda Road
MELBOURNE, VIC 3004
27 August 2020
Dear Board Members
Pental Limited
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following
declaration of independence to the directors of Pental Limited.
As lead audit partner for the audit of the financial statements of Pental Limited for the financial
year ended 28 June 2020, I declare that to the best of my knowledge and belief, there have been
no contraventions of:
(i) the auditor independence requirements of the Corporations Act 2001 in relation to
the audit; and
(ii) any applicable code of professional conduct in relation to the audit.
Yours sincerely
DELOITTE TOUCHE TOHMATSU
Travis Simkin
Partner
Chartered Accountants
Independent Auditor’s Report
to the members of Pental Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Pental Limited (the “Company”) and its subsidiaries (the
“Group”) which comprises the consolidated statement of financial position as at 28 June 2020, the
consolidated statement of profit or loss and other comprehensive income, the consolidated
statement of changes in equity and the consolidated statement of cash flows for the year then ended,
and notes to the financial statements, including a summary of significant accounting policies, and
the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
(i)
giving a true and fair view of the Group’s financial position as at 28 June 2020 and its
financial performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional & Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance
with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has
been given to the directors of the Company, would be in the same terms if given to the directors as
at the time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Liability limited by a scheme approved under Professional Standards Legislation.
52
Member of Deloitte Asia Pacific Limited and the Deloitte Network.
25
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Asia Pacific Limited and the Deloitte Network.
26
53
PENTAL ANNUAL REPORT 2020PENTAL ANNUAL REPORT 2020
Key Audit Matters
Responsibilities of the Directors for the Financial Report
Key audit matters are those matters that, in our professional judgement, were of most significance
in our audit of the financial report for the current period. These matters were addressed in the
context of our audit of the financial report as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
Key Audit Matter
How the scope of our audit responded to the
Key Audit Matter
Carrying value of brand names
Our audit procedures included, amongst others:
Refer to Note 15 Intangible assets
As at 28 June 2020, the Group holds
indefinite life brand names with a carrying
value of $12.3 million, which are required
to be assessed for impairment, at least
annually, or where there is an indicator of
impairment.
The recoverable amount of these brand
names has been determined using a ‘relief
from royalty’ approach, which incorporates
significant judgement related to the
estimation of maintainable sales, royalty
rates and an appropriate discount rate.
• Understanding the Group’s processes and the
relevant controls related to the preparation of
the relief from royalty model.
•
Evaluating the forecast cash flows in the
latest Board approved budget and assessing
the historical accuracy of budgeting.
• Assessing how the Group allowed for the
possible impact of COVID-19 in setting the
budget and their estimate of maintainable
revenue.
• Assessing the basis for key assumptions
including royalty rates, long term growth
rates and discount rates.
The estimation uncertainty increased at the
end of the year as a result of the impact of
COVID-19 on macroeconomic factors
underlying the assumptions used in the
value in use model.
•
In conjunction with our valuation specialists,
assessing the ‘relief from royalty’
methodology and mathematical accuracy of
managements model, as well as comparing
the discount rate and long term growth rates
to external benchmarks.
• Assessing management’s sensitivity analysis
and performing independent sensitivity
analysis to challenge key assumptions and
managements estimate of maintainable
revenue, royalty rates and discount rates;
•
Evaluating the appropriateness of the
disclosures included in Note 15 to the financial
statements.
Other Information
The directors are responsible for the other information. The other information comprises the
information included in the Group’s annual report for the year ended 28 June 2020, but does not
include the financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If,
based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of
the financial report that gives a true and fair view and is free from material misstatement, whether
due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group
to continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors either intend to liquidate the Group or to
cease operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk
of not detecting a material misstatement resulting from fraud is higher than for one resulting
from error, as
intentional omissions,
involve collusion,
fraud may
misrepresentations, or the override of internal control.
forgery,
• Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Group’s internal control.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Group’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the financial
report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the Group to cease to continue as a going concern.
•
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and
events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the
entities or business activities within the Group to express an opinion on the financial report.
We are responsible for the direction, supervision and performance of the Group’s audit. We
remain solely responsible for our audit opinion.
54
27
55
28
PENTAL ANNUAL REPORT 2020PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
We communicate with the directors regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, actions
taken to eliminate threats or safeguards applied.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 36 to 43 of the Directors’ Report for
the year ended 28 June 2020.
In our opinion, the Remuneration Report of Pental Limited, for the year ended 28 June 2020,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
DELOITTE TOUCHE TOHMATSU
Travis Simkin
Partner
Chartered Accountants
Melbourne, 27 August 2020
DIRECTORS’ DECLARATION
The Directors declare that:
(a) 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;
(b) in the Directors’ opinion, the attached fi nancial statements and notes thereto are in accordance with the Corporations
Act 2001, including compliance with accounting standards and giving a true and fair view of the fi nancial position and
performance of the Group;
(c) in the Director’s opinion the fi nancial statements and notes thereto are in accordance with International Financial Reporting
Standards issued by the International Accounting Standards Board as stated in note 2 to the fi nancial statements; and
(d) the Directors have been given the declarations required by s.295A of the Corporations Act 2001.
At the date of this declaration, the company is within the class of companies affected by ASIC Class Order 98/1418. The nature
of the deed of cross guarantee is such that each company which is party to the deed guarantees to each creditor payment in
full of any debt in accordance with the deed of cross guarantee.
In the Directors’ opinion, there are reasonable grounds to believe that the company and the companies to which the ASIC Class
Order applies, as detailed in note 12 to the fi nancial statements will, as a group, be able to meet any obligations or liabilities to
which they are, or may become, subject by virtue of the deed of cross guarantee.
Signed in accordance with a resolution of the directors made pursuant to s.295 (5) of the Corporations Act 2001.
On behalf of the Directors
Mark Hardgrave
Chairman
Melbourne, 27 August 2020
56
57
29
CONSOLIDATED STATEMENT
OF FINANCIAL POSITION
As at 28 June 2020
28 June 2020
30 June 2019
Note
$’000
$’000
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
For the year (52 weeks) ended 28 June 2020
2020
2019
Continuing Operations
Gross sales revenue
Trading terms, promotional rebates and discounts
Revenue from the sale of goods
Other revenue and income
Other gains and losses
Changes in inventory of finished goods and work in progress
Raw materials, consumables used and utilities
Employee benefits expense
Freight out and distribution expense
Marketing expenses
Occupancy expenses
Selling expenses
Repairs and maintenance expense
Other expenses
Impairment of brand names
Profit before finance costs, income tax, depreciation and amortisation (EBITDA)
Depreciation and amortisation expense
Profit before finance costs and income tax (EBIT)
Finance costs
Profit before tax
Income tax expense
Net Profit for the year
Profit Attributable to Members of the Parent Entity
Other comprehensive income
Items that may be classified subsequently to profit or loss:
Gain/(loss) on cash flow hedges taken to equity
Income tax relating to components of other comprehensive income
Other comprehensive income for the year (net of tax)
Total comprehensive income for the year
Profit attributable to equity holders of the parent
Total comprehensive income attributable to equity holders of the parent
Earnings per share Attributable to the Members of the Parent Entity
Basic (cents per share)
Diluted (cents per share)
Note
$’000
$’000
188,994
(62,534)
4
126,460
92
(159)
(642)
(82,401)
(14,553)
(8,001)
(2,576)
(854)
(1,404)
(1,141)
(2,849)
-
11,972
(4,576)
7,396
(175)
7,221
(2,202)
5,019
5,019
366
(110)
256
5,275
5,019
5,275
3.68
3.64
7
15
7
5
5
8
8
153,986
(53,540)
100,446
73
317
(11,807)
(53,716)
(12,347)
(6,736)
(1,855)
(1,129)
(1,148)
(1,064)
(2,704)
(2,185)
6,145
(3,316)
2,829
(73)
2,756
(835)
1,921
1,921
(256)
77
(179)
1,742
1,921
1,742
1.41
1.41
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other financial assets
Other
Total current assets
Non-current assets
Right-of-use assets
Property, plant and equipment
Other intangible assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Other financial liabilities
Current tax payables
Lease liabilities
Provisions
Total current liabilities
Non-current liabilities
Deferred tax liabilities
Lease liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
Notes to the financial statements are included on pages 62 to 87.
Notes to the financial statements are included on pages 62 to 87.
58
27(a)
9
10
11
16
14
13
15
17
18
6
14
20
6
14
20
21
3,668
20,133
23,419
340
301
246
17,617
22,777
-
268
47,861
40,908
1,170
20,634
12,508
34,312
-
22,588
12,501
35,089
82,173
75,997
18,340
17,017
212
1,362
456
2,254
22,624
2,865
746
139
3,750
26,374
55,799
90,658
303
26
336
-
1,961
19,340
3,344
-
129
3,473
22,813
53,184
90,658
(18)
(35,162)
(37,456)
55,799
53,184
59
PENTAL ANNUAL REPORT 2020PENTAL ANNUAL REPORT 2020 PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
CONSOLIDATED STATEMENT
OF CASH FLOWS
For the year (52 weeks) ended 28 June 2020
For the year (52 weeks) ended 28 June 2020
Balance at 1 July 2018
Loss for the year
Gain on cash fl ow hedges
Deferred tax arising on hedges
Total comprehensive income for the year
Dividend Payment
Recognition of share based payments
Note
$’000
90,658
6
22(a)
-
-
-
-
-
-
Issued
capital
Hedging
reserve
Equity
settled
employee
benefi ts
reserve
Retained
earnings
Total
$’000
$’000
$’000
$’000
161
-
(256)
77
(179)
-
-
85
(37,197)
53,707
-
-
-
-
-
1,921
-
-
1,921
1,921
(256)
77
1,742
(2,180)
(2,180)
(85)
-
(85)
Cash fl ows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest on lease liabilities
Interest received
Interest and other costs of fi nance paid
Income tax paid
Net cash provided by/(used in) operating activities
Cash fl ows from investing activities
Payments for plant and equipment
Payments for intangible assets
Net cash used in investing activities
Cash fl ows from fi nancing activities
Repayment of lease liabilities
Utilisation of supplier payment facility
(37,456)
53,184
(37,456)
53,184
5,019
-
-
5,019
5,019
366
(110)
5,275
Balance at 30 June 2019
90,658
(18)
Balance at 30 June 2019
Profi t for the year
Gain on cash fl ow hedges
Deferred tax arising on hedges
Total comprehensive income for the year
Dividend Payment
Recognition of share based payments
90,658
-
-
-
-
-
-
(18)
-
366
(110)
256
-
-
6
22(a)
Balance at 28 June 2020
90,658
238
Notes to the fi nancial statements are included on pages 62 to 87.
-
-
-
-
-
-
-
65
65
60
(2,725)
(2,725)
Dividends paid
-
65
Net cash used in fi nancing activities
(35,162)
55,799
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the fi nancial year
Cash and cash equivalents at the end of the fi nancial year
27(a)
Notes to the fi nancial statements are included on pages 62 to 87.
Note
14
27(b)
13
15
14
22
2019
$’000
2020
$’000
138,666
109,669
(128,228)
(110,570)
(59)
-
(116)
(1,758)
8,505
(1,990)
(89)
(2,079)
(491)
212
(2,725)
(3,004)
3,422
246
3,668
-
28
(73)
(1,484)
(2,430)
(2,112)
(77)
(2,189)
-
-
(2,180)
(2,180)
(6,799)
7,045
246
61
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
NOTES TO THE FINANCIAL
STATEMENTS
1. GENERAL INFORMATION
Basis of preparation
Pental Limited, incorporated and domiciled in Australia, is a
publicly listed company on the Australian Stock Exchange,
limited by shares.
Company Secretary
Mr Oliver Carton
Principal Registered offi ce
Pental Limited
Level 6, 390 St. Kilda Road
Melbourne Victoria 3004
Telephone: (03) 9251 2311
Facsimile: (03) 9645 3001
www.pental.com.au
Share Registry
Boardroom Pty Limited
Grosvenor Place, Level 12,
225 George Street Sydney NSW 2000
Telephone within Australia: 1300 737 760
Telephone outside Australia: +61 2 9290 9600
Facsimile: +61 2 9279 0664
www.boardroomlimited.com.au
2. SIGNIFICANT ACCOUNTING POLICIES
Statement of compliance
These fi nancial statements are general purpose fi nancial
statements which have been prepared in accordance with
the Corporations Act 2001, Accounting Standards and
Interpretations, and comply with other requirements of the
law. The fi nancial statements comprise consolidated fi nancial
statements of the consolidated entity (the “Group”). For the
purposes of preparing the consolidated fi nancial statements,
the Company is a for-profi t entity.
Accounting Standards include Australian equivalents to
International Financial Reporting Standards (‘A-IFRS’).
Compliance with A-IFRS ensures that the fi nancial statements
and notes of the Group comply with International Financial
Reporting Standards (‘IFRS’).
The fi nancial statements were authorised for issue by the
directors on 27 August 2020.
The fi nancial statements have been prepared on the basis
of historical cost, except for the revaluation of certain
fi nancial instruments. Cost is based on the fair values of the
consideration given in exchange for assets. All amounts are
presented in Australian dollars, unless otherwise noted.
The Company is a company of a kind referred to in ASIC
Corporations (Rounding in Financial/Directors’ Reports)
Instrument 2016/191 dated 24 March 2016, and in accordance
with that Corporations Instrument, amounts in the Directors’
Report and fi nancial report are rounded off to the nearest
hundred thousand dollars, unless otherwise indicated.
Critical accounting judgments and key sources of
estimation uncertainty
In the application of the Group’s accounting policies,
management is required to make judgments, estimates and
assumptions about carrying values of assets and liabilities that
are not readily apparent from other sources. The estimates and
associated assumptions are based on historical experience and
other factors that are considered to be relevant. Actual results
may differ from these estimates.
The estimates and underlying assumptions are reviewed on an
ongoing basis. Revisions to accounting estimates are recognised
in the period in which the estimate is revised if the revision
affects only that period or in the period of the revision and
future periods if the revision affects both current and future
periods.
The following are the key assumptions concerning the future,
and other key sources of estimation uncertainty at balance
sheet date, that have a signifi cant risk of causing a material
adjustment to the carrying amounts of assets and liabilities
within the next fi nancial year:
Impairment of brand names
Determining whether brand names are impaired requires an
estimation of recoverable amount, representing the higher of
the fair value less costs to sell and the value in use of the cash-
generating units to which brand names have been allocated.
The estimation of recoverable amount requires the entity
to estimate the future cash fl ows expected to arise from the
cash-generating unit and a suitable discount rate in order to
calculate present value.
The carrying amount of brand names at 28 June 2020 was
$12.354 million (30 June 2019: $12.354 million). Details of
movements and impairment testing are set out in Note 15.
Trade spend accounting judgement
Trade receivables are disclosed net of rebates payable. The
Group has the legal right to offset such balances as they are
with the same customers and it is the Group’s intention to net
settle any outstanding items. The main judgement related to
accruals for customer rebates is the timing and extent to which
temporary promotional activity has occurred prior to year-
end. Customer rebates consist primarily of customer pricing
allowances and promotional allowances, which are governed
by agreements with our trade customers (retailers and
distributors). Accruals are recognised under the terms of these
agreements, to refl ect the expected promotional activity and
our historical experience.
Adoption of new and revised Accounting Standards
In the current year, the Group has adopted all of the following
new and revised Standards and Interpretations issued by the
Australian Accounting Standards Board (the AASB) that are
relevant to its operations and effective for the current annual
reporting period:
■ AASB 16 Leases
AASB 16 Leases became effective for the Group on 1 July
2019. As a result, the Group changed its related accounting
policies resulting in recognition of Right-of-use assets and
associated lease liabilities at 1 July 2019. The nature and
effect of these changes are disclosed in Note 14.
■ AASB 2018-1 Amendments to Australian Accounting
Standards - Annual Improvements 2015 - 2017 Cycle
The adoption of this amending Standard did not have any
impact on the disclosures or the amounts recognised in the
Group’s condensed consolidated fi nancial statements
■ Interpretation 23 Uncertainty over Income Tax Treatments
The adoption of this amending Standard did not have any
impact on the disclosures or the amounts recognised in the
Group’s condensed consolidated fi nancial statements
The Group has not early adopted any other standard,
interpretation or amendment that has been issued but is not
yet effective.
Accounting policies
The following signifi cant accounting policies have been
adopted in the preparation and presentation of the
fi nancial statements:
(a) Basis of consolidation
The consolidated fi nancial statements are prepared by
combining the fi nancial statements of all the entities that
comprise the consolidated entity, being the Company (the
parent entity) and its subsidiaries (referred to as “the Group”
in these fi nancial statements) as defi ned in Accounting
Standard AASB 10 ‘Consolidated Financial Statements’. A list
of subsidiaries appears in Note 12 to the fi nancial statements.
Consistent accounting policies are employed in the preparation
and presentation of the consolidated fi nancial statements.
In preparing the consolidated fi nancial statements, all
intercompany balances and transactions, and unrealised profi ts
arising within the Group are eliminated in full.
(b) Foreign currency
The presentation and functional currency of the Group is
Australian dollars.
Foreign currency transactions
All foreign currency transactions during the fi nancial year are
brought to account using the exchange rate in effect at the
date of the transaction. Foreign currency monetary items at
reporting date are translated at the exchange rate existing at
reporting date.
Exchange differences are recognised in profi t or loss in the
period in which they arise except that:
■ Exchange differences on transactions entered into in order to
hedge certain foreign currency risks (refer Note 23); and
■ Exchange differences on monetary items receivable from
or payable to a foreign operation for which settlement is
neither planned or likely to occur, which form part of the
net investment in a foreign operation, are recognised in the
foreign currency translation reserve and recognised in profi t
or loss on disposal of the net investment.
(c) Goods and services tax
Revenues, expenses and assets are recognised net of the
amount of goods and services tax (GST), except:
i. where the amount of GST incurred is not recoverable from
the taxation authority, it is recognised as part of the cost of
acquisition of an asset or as part of an item of expense; or
ii. for receivables and payables which are recognised inclusive
of GST.
The net amount of GST recoverable from, or payable to, the
taxation authority is included as part of receivables or payables.
Cash fl ows are included in the cash fl ow statement on a gross
basis. The GST component of cash fl ows arising from investing
and fi nancing activities which is recoverable from, or payable
to, the taxation authority is classifi ed within operating cash fl ows.
62
63
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS [CONT]
2. SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
(d) Revenue
Revenues are recognised at fair value of the consideration
received net of the amount of goods and services tax (GST)
payable to the taxation authority. Refer to Note 4 for further
details on the accounting policy for revenue from the sale
of goods.
(e) Share based payment transactions
The Executive Variable Incentive Plan (EVIP) grants shares
in the Company to certain employees. The fair value of the
performance rights granted under the EVIP is recognised
as an employee expense with a corresponding increase in
equity. The fair value is measured at grant date and is spread
recognised only in the period it was granted. The fair value of
the performance rights granted is measured using Monte Carlo
method, taking into account the terms and conditions upon
which the performance rights were granted.
(f) Income tax
Current tax
Current tax is calculated by reference to the amount of income
taxes payable or recoverable in respect of the taxable profi t
or tax loss for the period. It is calculated using tax rates and
tax laws that have been enacted or substantively enacted by
reporting date. Current tax for current and prior periods is
recognised as a liability (or asset) to the extent that it is unpaid
(or refundable).
Deferred tax
Deferred tax is accounted for using the comprehensive balance
sheet liability method in respect of temporary differences
arising from differences between the carrying amount of assets
and liabilities in the fi nancial statements and the corresponding
tax base of those items.
In principle, deferred tax liabilities are recognised for all taxable
temporary differences. Deferred tax assets are recognised to the
extent that it is probable that suffi cient taxable amounts will
be available against which deductible temporary differences or
unused tax losses and tax offsets can be utilised.
However, deferred tax assets and liabilities are not recognised
if the temporary differences giving rise to them arise from the
initial recognition of assets and liabilities (other than as a result
of a business combination) which affects neither taxable income
nor accounting profi t. Furthermore, a deferred tax liability is
not recognised in relation to taxable temporary differences
arising from goodwill.
Deferred tax liabilities are recognised for taxable temporary
differences arising on investments in subsidiaries, except where
the Group is able to control the reversal of the temporary
differences and it is probable that the temporary differences
will not reverse in the foreseeable future. Deferred tax assets
arising from deductible temporary differences associated with
these investments and interests are only recognised to the
extent that it is probable that there will be suffi cient taxable
profi ts against which to utilise the benefi ts of the temporary
differences and they are expected to reverse in the
foreseeable future.
Deferred tax assets and liabilities are measured at the tax rates
that are expected to apply to the period(s) when the asset and
liability giving rise to them are realised or settled, based on tax
rates (and tax laws) that have been enacted or substantively
enacted by reporting date. The measurement of deferred tax
liabilities and assets refl ects the tax consequences that would
follow from the manner in which the Group expects, at the
reporting date, to recover or settle the carrying amount of its
assets and liabilities.
Deferred tax assets and liabilities are offset when they relate
to income taxes levied by the same taxation authority and the
Company/Group intends to settle its current tax assets and
liabilities on a net basis.
Current and deferred tax for the period
Current and deferred tax is recognised as an expense or income
in profi t or loss, except when it relates to items credited or
debited directly to equity, in which case the deferred tax is also
recognised directly in equity, or where it arises from the initial
accounting for a business combination, in which case it is taken
into account in the determination of goodwill or excess.
Tax consolidation
The Company and all its wholly-owned Australian resident entities
are part of a tax consolidated group under Australian taxation
law. Pental Limited is the head entity in the tax-consolidated
group. Tax expense/income, deferred tax liabilities and deferred
tax assets arising from temporary differences of the members
of the tax consolidated group are recognised in the separate
fi nancial statements of the members of the tax-consolidated
group using the ‘separate taxpayer within group approach.
Current tax liabilities and assets and deferred tax assets arising
from unused tax losses and tax credits of the members of the
tax-consolidated group are recognised by the company (as head
entity in the tax-consolidated group). Due to the existence of
a tax funding arrangement between the entities in the tax
consolidated group, amounts are recognised as payable to or
receivable by the company and each member of the group
in relation to the tax contribution amounts paid or payable
between the parent entity and the other members of the tax-
consolidated group in accordance with the arrangement.
Where the tax contribution amount recognised by each
member of the tax-consolidated group for a particular period
is different to the aggregate of the current tax liability or asset
and any deferred tax asset arising from unused tax losses and
tax credits in respect of that period, the difference is recognised
as a contribution from (or distribution to) equity participants.
(h) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, cash in
banks and investments in money market instruments, net of
outstanding bank overdrafts.
(i) Financial assets
Trade receivables, and investments in subsidiaries are recognised
and derecognised on trade date where purchase or sale of an
investment or a loan and receivable is under a contract whose
terms require delivery of the asset within the time frame
established by the market concerned, and are initially measured
at fair value, net of transaction costs. Subsequent to initial
recognition, investments are measured at cost.
Trade receivables
Trade receivables are initially recognised at fair value and
subsequently measured at amortised cost using the effective
interest method, less any expected credit losses. Trade receivables
are disclosed net of rebates payable where the Group has the
legal right to offset such balances as they are with the same
customers and it is the Group’s intention to net settle.
Provision for Expected Credit Loss
The Group applies the simplifi ed approach to the measurement
of expected credit losses, using the lifetime expected loss
allowance for all trade receivables. To measure the expected
credit losses, trade receivables are group based on credit risk
characteristics and the days past due. A provision matrix is then
determined based on historical credit loss rate for each group,
adjusted for any material expected changes to the future credit
risk for that group.
Other fi nancial assets
For the accounting policy on derivatives – refer Note 2(r) and
Note 23.
(j) Inventories
Inventories are carried at the lower of cost and net realisable
value.
Cost includes direct materials, direct labour, other direct
variable costs and allocated production overheads necessary to
bring inventories to their present location and condition, based
on normal operating capacity of the production facilities.
Manufacturing activities
The cost of manufacturing inventories and work-in-progress
are assigned on a fi rst-in fi rst-out basis. Costs arising from
exceptional wastage are expensed as incurred.
Net realisable value
Net realisable value represents the estimated selling price
for inventories less estimated costs of completion and costs
necessary to make the sale. Net realisable value is determined
on the basis of each inventory line’s normal selling pattern.
(k) Property, plant and equipment
The carrying amount of property, plant and equipment is
valued on the cost basis.
Depreciation is calculated on a straight line basis so as to write
off the net cost of each asset over its expected useful life to
its estimated residual value. Leasehold improvements are
depreciated over the period of the lease or estimated useful
life, whichever is the shorter, using the straight line method.
The estimated useful lives, residual values and depreciation
method are reviewed at the end of each annual reporting
period. Plant and equipment estimated useful life used in
the calculation of depreciation is 3 to 20 years. Buildings are
depreciated over a period of 30 years on a straight line basis.
Land is not depreciated.
(l) Borrowing costs
Borrowing costs include interest, amortisation of discounts or
premiums relating to borrowings, amortisation of ancillary
costs incurred in connection with arrangement of borrowings,
foreign exchange differences net of hedged amounts on
borrowings, including trade creditors and lease fi nance charges.
Ancillary costs incurred in connection with the arrangement of
borrowings are capitalised and amortised over the life of the
borrowings. Borrowing costs are expensed as incurred.
(m) Intangible assets
Brand names
Brand names are not amortised as the Directors believe the
brands have an indefi nite useful life. Brand names with
indefi nite useful lives are tested for impairment annually
and whenever there is an indication that the asset may be
impaired. Brand names are recorded at fair value at the time of
acquisition, less any impairment subsequently recorded.
64
65
NOTES TO THE FINANCIAL STATEMENTS [CONT]
2. SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED)
Computer Software
All costs directly incurred in the purchase or development of
major computer software or subsequent upgrades and material
enhancements, which can be reliably measured and are not
integral to a related asset, are capitalised as intangible assets.
Costs capitalised include external direct costs of materials,
services and travel. Costs incurred on computer maintenance
or during planning phase are expensed as incurred. Computer
software is amortised over the period of time during which the
benefits are expected to arise being 3 to 5 years.
(n) Impairment of assets
At each reporting date, the Group reviews the carrying
amounts of its tangible and intangible assets to determine
whether there is any indication that those assets have suffered
an impairment loss. If any such indication exists, the recoverable
amount of the asset is estimated in order to determine the
extent of the impairment loss (if any). Where the asset does not
generate cash flows that are independent from other assets,
the Group estimates the recoverable amount of the cash-
generating unit to which the asset belongs. Intangible assets
with indefinite useful lives are tested for impairment at least
annually and whenever there is an indication that the asset may
be impaired.
Recoverable amount is the higher of fair value less costs to
sell and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value using
a discount rate that reflects current market assessments of the
time value of money and the risks specific to the asset for which
the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit)
is estimated to be less than its carrying amount, the carrying
amount of the asset (or cash-generating unit) is reduced to its
recoverable amount. An impairment loss is recognised in the
profit or loss immediately.
Where an impairment loss subsequently reverses, the carrying
amount of the asset (or cash-generating unit) is increased to
the revised estimate of its recoverable amount, but only to the
extent that the increased carrying amount does not exceed
the carrying amount that would have been determined had
no impairment loss been recognised for the asset (or cash-
generating unit) in prior years. A reversal of an impairment loss
is recognised in profit or loss immediately.
(o) Employee benefits
Short-term and long-term employee benefits
Provision is made for benefits accruing to employees in respect
of wages and salaries, annual leave, long service leave, and sick
leave when it is probable that settlement will be required and
they are capable of being measured reliably. Provisions made in
respect of employee benefits are measured as the present value
of estimated future cash outflows to be made by the Group in
respect of services provided by employees up to reporting date.
(p) Provisions
Provisions are recognised when the Group has a present
obligation (legal or constructive) as a result of a past event,
it is probable that the Group will be required to settle the
obligation, and a reliable estimate can be made of the amount
of the obligation.
The amount recognised as a provision is the best estimate of
the consideration required to settle the present obligation at
reporting date, taking into account the risks and uncertainties
surrounding the obligation. Where a provision is measured
using the cash flows estimated to settle the present obligation,
its carrying amount is the present value of those cash flows.
When some or all of the economic benefits required to settle
a provision are expected to be recovered from a third party,
the receivable is recognised as an asset if it is virtually certain
that reimbursement will be received and the amount of the
receivable can be measured reliably.
Dividends
A provision for dividends payable is recognised in the reporting
period in which the dividends are declared, for the entire
undistributed amount, regardless of the extent to which they
will be paid in cash.
(q) Financial instruments issued by the company
Debt and equity instruments
Debt and equity instruments are classified as either liabilities or
as equity in accordance with the substance of the contractual
arrangement.
Transaction costs on the issue of equity instruments
Transaction costs arising on the issue of equity instruments are
recognised directly in equity as a reduction of the proceeds of
the equity instruments to which the costs relate. Transaction
costs are the costs that are incurred directly in connection with
the issue of those equity instruments and which would not have
been incurred had those instruments not been issued.
Interest and dividends
Interest and dividends are classified as expenses or as
distributions of profit consistent with the statement of financial
position classification of the related debt or equity instruments
or component parts of compound instruments.
(r) Derivative financial instruments
The Group is exposed to changes in interest rates and foreign
exchange rates from its activities. The Group uses forward
foreign exchange contracts to hedge these risks. Derivative
financial instruments are not held for speculative purposes.
The Group uses derivative financial instruments, being forward
foreign currency contracts to hedge the risk associated with
foreign currency fluctuations. Such derivatives are stated at fair
value. The fair value of forward exchange contracts is calculated
by reference to current forward exchange rates for contracts
with similar maturity profiles.
Derivatives are initially recognised at fair value on the date
a derivative contract is entered into and are subsequently
remeasured to their fair value at each reporting date. For
derivatives that do not qualify for hedge accounting, any gains
or losses arising from changes in fair value are taken directly to
profit or loss for the year.
For derivatives that qualify for hedge accounting, the method
for recognising gains and losses on changes in fair value
depends on whether the derivative is classified as a fair value
hedge or a cash flow hedge. Derivatives are classified as fair
value hedges when they hedge the exposure to changes in
the fair value of a recognised asset or liability and as cash flow
hedges when they hedge exposure to variability in cash flows
that are attributable to either a particular risk associated with
a recognised asset or liability or to a forecast transaction. The
Group documents at inception of the hedge the relationship
between the hedging instruments (derivatives) and the hedged
items, as well as the risk management objective and strategy
for undertaking the hedge transaction.
The Group also documents, both at inception of the hedge and
on an ongoing basis whether the derivatives that are used in
the hedging transactions have been, and will continue to be,
highly effective in offsetting changes in fair values or cash flows
of hedged items.
Changes in the fair value of derivatives that are designated and
qualify as fair value hedges are recorded in the profit or loss
for the year, together with any changes in the fair value of
the hedged asset or liability that are attributable to the
hedged risk.
The effective portion of changes in the fair value of derivatives
that are designated and qualify as cash flow hedges is
recognised in equity in the hedging reserve and transferred to
profit or loss when the hedged item affects profit or loss. The
gain or loss relating to the ineffective portion is recognised
immediately in the profit or loss. However, when the cash flow
hedge relates to a forward foreign exchange contract to hedge
a highly probable forecast transaction or firm commitment that
results in a non-financial asset (e.g. inventory) or a non-financial
liability, the gains and losses previously deferred in equity are
transferred from equity and included in the initial measurement
of the initial cost or carrying amount of the asset or liability.
Hedge accounting is discontinued when the hedging
instrument expires, or is sold, terminated or exercised, or no
longer qualifies for hedge accounting. At that point in time,
any cumulative gains or losses on the hedging instrument
recognised in equity is kept in equity until the forecast
transaction occurs. If the forecast transaction is no longer
expected to occur, the net cumulative gain or loss recognised in
equity is transferred to profit or loss for the year.
(s) Financial year
As allowed under Section 323D (2) of the Corporations Act
2001, the Directors have determined the financial year to be a
fixed period of 52 calendar or 53 calendar weeks. For the period
to 28 June 2020, the Group is reporting on the 52 week period
that began 1 July 2019 and ended 28 June 2020. For the period
to 30 June 2019, the Group is reporting on the 52 week period
that began 2 July 2018 and ended 30 June 2019
3. SEGMENT INFORMATION
The Group’s business activities are based in Australia and
encompass the manufacturing, marketing and distribution of
goods targeted at the household essentials market in Australia,
New Zealand and Asia.
The Group is organised into one operating segment, consistent
with the centralised nature of its operations in Australia and
management reporting provided to the Group’s Chief Executive
Officer (the chief operating decision maker), which is used to
manage the business and allocate resources.
Accordingly, the information provided in this Annual Report
reflects the one operating and reporting segment.
4. REVENUE
The Group generates revenue from the sale of goods on a point
in time basis as follows:
2020
$’000
2019
$’000
Revenue from the sale of goods
126,460
100,446
The Group’s Top 6 customers (Woolworths Limited, Coles Group
Ltd , Metcash Ltd, Foodstuffs (Auckland) Ltd, Costco Wholesale
Corporation and Battery Specialists Group) generated 79.5%
of the Group’s revenue for the year ended 28 June 2020 (2019:
79.8% from top six customers - Woolworths Limited, Coles
Group Ltd , Metcash Ltd, Foodstuffs (Auckland) Ltd, Costco
Wholesale Corporation and Battery Specialists Group).
66
67
PENTAL ANNUAL REPORT 2020PENTAL ANNUAL REPORT 2020 PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS [CONT]
4. REVENUE (CONTINUED)
5. FINANCE COSTS
Geographical analysis
Summarised below is a geographical analysis of revenue based
on the geographical location of the Group’s customers:
Geographical sales
Australia
New Zealand
Asia
2020
$’000
2019
$’000
109,578
86,298
14,586
12,244
2,296
1,904
Total geographical sales
126,460
100,446
Segment assets, liabilities and expenses located in Australia are
unable to be allocated to individual geographical segments by
customer location on a reasonable basis.
Accounting policy for revenue from the sale of goods:
The Group manufactures, markets and distributes a range
of products targeted at the household essential market in
Australia, New Zealand and Asia. Revenue from the sale of
goods is recognised when control of the goods has transferred,
being when the goods are delivered to the customer, the
customer has full discretion over the channel and price to sell
the goods, and there is no unfulfi lled obligation that could
affect the customer’s acceptance of the good. Delivery occurs
when the goods have been shipped to the specifi c location,
the risks of obsolescence and loss have been transferred
to the customer, and either the customer has accepted the
goods in accordance with the terms of the sale or the Group
has objective evidence that all criteria for acceptance has
been satisfi ed. A receivable is recognised when the goods are
delivered as this is the point in time that the consideration is
unconditional because only the passage of time is required
before the payment is due.
Goods are often sold with rebates and discounts related to
trading terms and promotional activities (“Trade Spend”).
Revenue from these sales is recognised net of the estimated
value of Trade Spend. Accumulated experience is used to
estimate and provide for Trade Spend, using the expected value
method, and revenue is only recognised to the extent that it is
highly probable that a signifi cant reversal will not occur.
An accrual for Trade Spend is recognised in relation to sales
made up to the end of the reporting period.
No element of fi nancing is deemed present as the sales are
made with credit terms of maximum 60 days from invoice
month end, consistent with market practice.
68
2020
$’000
76
40
59
175
2020
$’000
2,841
(589)
(50)
2019
$’000
21
52
-
73
2019
$’000
1,771
(936)
-
Interest on borrowings
Other borrowing costs
Interest on leases
Total interest expense
6. INCOME TAXES
Income tax recognised in profi t or loss
Tax expense comprises:
Current tax expense
Deferred tax expense
Adjustments recognised in
relation to the current tax
of prior years
Total tax expense
2,202
835
The prima facie income tax expense on pre-tax accounting
profi t reconciles to the income tax expense in the fi nancial
statements as follows:
2020
$’000
7,221
2,166
86
(50)
2019
$’000
2,756
826
9
-
Profi t from operations
Tax at the Australian tax rate
of 30%
Non Deductible items
Adjustments recognised in
relation to the current tax of
prior years
Total tax expense
2,202
835
The tax rate used in the above reconciliation is the corporate
tax rate of 30% payable by Australian corporate entities on
taxable profi ts under Australian tax law. There has been no
change in the corporate tax rate when compared with the
change in the corporate tax rate when compared with the
previous reporting period.
Income tax recognised in other comprehensive income
2020
$’000
2019
$’000
(110)
77
Deferred tax
Arising on amounts recognised
in other comprehensive income:
Changes in the fair value of
cash fl ow hedges
Deferred tax balances
Deferred tax assets/ (liabilities) arise from the following:
Opening
balance
Charged to
income
2020
Recognised
in other
comprehensive
income
Charged
to equity
Closing
Balance
$’000
$’000
$’000
$’000
$’000
Deferred tax assets
Provision for expected credit losses
Provisions
Lease Liabilities
Foreign currency items
Inventory obsolescence
Accruals
Deferred tax liabilities
Property, plant and equipment
Leased Assets
Foreign currency items
Brandnames
Other
Net deferred tax asset / (liability)
9
674
-
4
174
4
865
(500)
-
-
(3,706)
(3)
(4,209)
(3,344)
26
77
369
(4)
48
56
639
349
(351)
19
-
-
17
589
-
-
-
-
-
-
-
-
-
(110)
-
-
(110)
(110)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
35
751
369
0
222
60
1,437
(151)
-
(91)
(3,706)
(3)
(4,302)
(2,865)
69
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS [CONT]
6. INCOME TAXES (CONTINUED)
Opening
balance
Charged to
income
2019
Recognised
in other
comprehensive
income
Charged
to equity
Closing
Balance
$’000
$’000
$’000
$’000
$’000
-
606
4
-
125
4
739
(630)
(4,362)
(101)
(3)
(5,096)
(4,357)
9
68
(4)
(73)
49
-
49
130
656
101
-
887
936
-
-
-
77
-
-
77
-
-
-
-
-
77
-
-
-
-
-
-
-
-
-
-
-
-
-
9
674
-
4
174
4
865
(500)
(3,706)
-
(3)
(4,209)
(3,344)
Deferred tax assets
Provision for expected credit losses
Provisions
Share issue costs
Foreign currency items
Inventory obsolescence
Accruals
Deferred tax liabilities
Property, plant and equipment
Brandnames
Foreign currency items
Other
Net deferred tax asset / (liability)
Current tax liabilities
Income tax payable
2020
$’000
1,362
1,362
2019
$’000
336
336
Tax consolidation
The company and its wholly-owned Australian resident entities
have formed a tax-consolidated group, and are therefore taxed
as a single entity. The head entity within the tax-consolidated
group is Pental Limited. The members of the tax-consolidated
group are identifi ed at Note 12.
Nature of tax funding arrangements and tax sharing
agreements
Entities within the tax-consolidated group have entered into a
tax funding arrangement and a tax-sharing agreement with the
head entity. Under the terms of the tax funding arrangement,
Pental Limited and each of the entities in the tax-consolidated
group has agreed to pay a tax equivalent payment to or
from the head entity, based on the current tax liability or
current tax asset of the entity. Such amounts are refl ected in
amounts receivable from or payable to other entities in the
tax-consolidated group. The tax sharing agreement entered
into between members of the tax-consolidated group provides
for the determination of the allocation of income tax liabilities
between the entities should the head entity default on its
tax payment obligations or if an entity should leave the tax-
consolidated group. The effect of the tax sharing agreement
is that each member’s liability for tax payable by the tax-
consolidated group is limited to the amount payable to the
head entity under the tax funding arrangement.
The earnings and weighted average number of ordinary shares
used in the calculation of basic and diluted earnings per share
are as follows:
2020
$’000
5,019
5,019
2019
$’000
1,921
1,921
5,019
1,921
2020
No.
2019
No.
136,250,633
136,250,633
Net profi t/(loss)
Earnings/(loss) used in the
calculation of basic EPS
Earnings/(loss) used in the
calculation of diluted EPS
Weighted average number
of ordinary shares for the
purposes of basic earnings
per share
The weighted average number of ordinary shares for the
purposes of diluted earnings per share reconciles to the
weighted average number of ordinary shares used in the
calculation of basic earnings per share as follows.
2020
No.
2019
No.
136,250,633
136,250,633
1,625,000
-
137,875,633
136,250,633
Weighted average number
of ordinary shares for the
purposes of basic earnings
per share
Shares deemed to be issued for
no consideration in respect of:
- performance rights over
ordinary shares
Weighted average number
of ordinary shares for the
purposes of diluted earnings
per share
Unrecognised taxable temporary differences associated with
investments and interests
In accordance with AASB112.81, there are no taxable temporary
differences in relation to investments in subsidiaries for which
deferred tax assets or liabilities have not been recognised.
7. PROFIT FOR THE YEAR
(a) Profi t for the year has been arrived at after charging the
following expenses:
2020
$’000
2019
$’000
Expenses
Cost of goods sold
96,246
77,017
Depreciation: Property, plant
and equipment
Depreciation: Right-of-use
assets
Amortisation: Software
Total depreciation and
amortisation
3,942
3,197
552
82
4,576
-
119
3,316
Employee benefi ts expense:
Post-employment benefi ts –
defi ned contribution plans
1,057
973
Share based payments expense
65
(85)
Other employee benefi ts
13,431
11,459
14,553
12,347
Cost of goods sold includes cost of products or raw materials,
including inbound freight, direct labour costs for production
and factory overhead expenses where applicable.
8. EARNINGS PER SHARE
2020
2019
Cents
Per Share
Cents
Per Share
Basic earnings per share
Diluted earnings per share
3.68
3.64
1.41
1.41
70
71
NOTES TO THE FINANCIAL STATEMENTS [CONT]
8. EARNINGS PER SHARE (CONTINUED)
Ageing of past due
12. SUBSIDIARIES
2019
$’000
401
134
122
657
2019
$’000
-
30
30
Classification of securities as potential ordinary shares
Performance rights over ordinary shares in the Company granted
under Executive Variable Incentive Plan (EVIP) during the year are
deemed to be eligible to vest and treated as dilutive.
In the prior period, diluted earnings per share is the same as
basic earnings per share as Performance rights over ordinary
shares in the Company that were granted to key management
personnel in prior years were deemed unlikely to vest and
treated as non dilutive.
Overdue 31 to 60 days
Overdue 61 to 90 days
Overdue 91 days and beyond
Total
2020
$’000
581
41
12
634
9. TRADE AND OTHER RECEIVABLES
Movement in the allowance for expected credit losses
Current
2020
$’000
2019
$’000
Trade receivables (i)
20,170
17,298
Other (ii)
Allowance for expected
credit losses
79
(116)
349
(30)
20,133
17,617
(i) The average credit period on sales of goods is approximately
60 days. No interest is charged on trade receivables.
An allowance has been made for expected credit losses using
a provision matrix based on historical credit loss rates. Trade
receivables are recognised at amortised cost less provision
for credit losses.
Before accepting any new customers, the Group will perform a
credit check to assess the potential customer’s credit quality and
defines credit limits by customer. Limits are reviewed as necessary.
Of the trade receivables balance at the end of the year $14.971
million is due from top six customers (2019: $14.348 million from
top six customers) and these six customers account for 79.5%
of total sales revenue for the year (2019: 79.8% from top six
customers). There are no other customers who represent more
than 5% of the total balance of trade receivables or total sales
revenues from continuing operations for the year. The Group does
not hold any collateral over these balances.
(ii) Other receivables generally arise from transactions outside
the usual operating activities of the Group. These amounts
are predominantly reimbursements sought from suppliers for
rebates and payments made in advance to suppliers for goods
subsequently reclassified as receivables. Collateral is generally
not obtained.
72
Balance at the beginning of the
year
Re-measurement of loss allowance
Balance at the end of the year
2020
$’000
30
86
116
Under the expected credit loss methodology, the provision for
impairment of receivables is the carrying value of maximum
exposure to credit risk at the reporting date. At 28 June 2020,
the amount of provision for expected credit losses was $116
thousand (2019: $30 thousand).
The amount of the expected credit losses is recognised in
profit or loss within other expenses. Subsequent recoveries of
amounts previously written off are credited against the same
line item.
10. INVENTORIES
Raw materials
Goods in transit
Finished goods
2020
$’000
4,551
4,927
2019
$’000
3,735
3,275
13,941
15,767
23,419
22,777
11. OTHER FINANCIAL ASSETS
Current
Foreign currency forward
contracts
2019
$’000
2020
$’000
340
340
Name of subsidiary
Parent Entity
Pental Limited (i)
Controlled Entities
Pental Limited (i)
Ownership interest
2020
%
2019
%
Country of incorporation
Australia
Australia
100%
100%
(i) Pental Limited is the head entity within the tax-consolidated group.
(ii) These companies are members of the tax-consolidated group.
(iii) The wholly-owned subsidiary has entered into a deed of cross guarantee with Pental Limited pursuant to ASIC Class Order 98/1418 and it is relieved from the requirement
to prepare and lodge an audited financial report.
The parent entity and all the controlled entities are party to the deed of cross guarantee therefore the consolidated statement of
profit or loss and other comprehensive income and statement of financial position reflects the statement of profit or loss and other
comprehensive income and statement of financial position of the parties to the deed of cross guarantee.
13. PROPERTY, PLANT AND EQUIPMENT
Gross carrying amount
Balance at 1 July 2018
Additions
Disposals
Transfer from capital works
1,732
5,580
-
-
-
48
-
-
Balance at 30 June 2019
1,732
5,628
Additions
Disposals
Transfer from capital works
Balance at 28 June 2020
Accumulated depreciation
Balance at 1 July 2018
Depreciation expense
Disposals
Balance at 30 June 2019
Depreciation expense
Disposals
Balance at 28 June 2020
Net book value as at 30 June 2019
Net book value as at 28 June 2020
1,732
1,732
Buildings at
cost
Plant and
equipment at
cost
Construction
in progress at
cost
$’000
$’000
$’000
Land
$’000
32,434
1,829
(72)
188
34,379
1,446
(3)
235
-
-
-
-
-
-
1,732
5,628
36,057
-
-
-
-
-
-
(170)
(190)
-
(360)
(192)
-
(552)
5,268
5,076
(16,076)
(3,007)
57
(19,026)
(3,750)
1
(22,775)
15,353
13,282
188
235
-
(188)
235
544
-
(235)
544
-
-
-
-
-
-
-
235
544
Total
$’000
39,934
2,112
(72)
-
41,974
1,990
(3)
-
43,961
(16,246)
(3,197)
57
(19,386)
(3,942)
1
(23,327)
22,588
20,634
73
PENTAL ANNUAL REPORT 2020PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS [CONT]
14. ADOPTION OF AASB 16 LEASES
The Group has adopted AASB 16 Leases from 1 July 2019. AASB
16 replaces existing leases guidance, including AASB 117 Leases
and related Interpretations. The Group has elected to transition
to the new standard using the modifi ed retrospective approach
with practical expedients. Under this approach, the group
has recognised right-of-use assets and equivalent lease
liabilities as of 1 July 2019, with no restatement of
comparative information.
(a) Accounting policy for leases
Until the end of the 2019 fi nancial year, leases of warehouses,
machinery and offi ce facilities were classifi ed as operating
leases. Payments made under operating leases (net of any
incentives received from the lessor) were charged to profi t or
loss on straight-line basis over the period of the lease.
From 1 July 2019, leases are recognised as a right-of-use asset
and a corresponding liability, at the date the leased asset is
available for use by the Group. Each lease payment is allocated
between the liability and fi nance cost. The fi nance cost is
charged to profi t or loss over the lease period to produce a
constant periodic rate of interest on the remaining balance of
the liability for each period.
Lease liabilities refl ect the net present value of fi xed payments,
less any lease incentives receivable. The lease payments are
discounted using the interest rate implicit in the lease. If that
rate cannot be determined, the lessee’s incremental borrowing
rate is used, being the rate that the lessee would have to pay to
borrow the funds necessary to obtain an asset of similar value
in a similar economic environment with similar terms
and conditions.
Right-of-use assets are measured at cost comprising the
following:
■ the amount of the initial measurement of lease liability;
■ estimated restoration costs.
Right-of-use assets are subsequently measured at cost less
accumulated depreciation and impairment losses, with
depreciation recognised on a straight-line basis over the
shorter of the asset’s useful life and the lease term. The Group
applies AASB 136 Impairment of Assets to determine whether
a right-of-use asset is impaired and accounts for any identifi ed
impairment loss as described in Note 2(n).
Payments associated with short-term leases and leases of
low-value assets are recognised on a straight-line basis as an
expense in profi t or loss. Short-term leases are leases with a
lease term of 12 months or less. Low-value assets primarily
comprise offi ce equipment such as printers and photocopiers.
In applying AASB 16 for the fi rst time, the Group used the
following practical expedients permitted by the standard:
■ the use of a single discount rate to a portfolio of leases with
reasonably similar characteristics;
■ reliance on previous assessments on whether leases are
onerous;
■ the use of hindsight in determining the lease term where the
contract contains options to extend the lease; and
In determining the lease term, management considers all facts
and circumstances that create an economic incentive to exercise
an extension option. Extension options are only included in the
lease term if the lease is reasonably certain to be extended.
Impact of adoption of AASB 16
Lease liabilities recognised at the date of initial application are
reconciled as follows:
Lease Liabilities
Operating lease commitments at 30 June 2019
Impact of discounting using the lessees
incremental borrowing rate:
Less: Short term leases and leases of low value
assets recognised as operating expenses
Add: adjustments as a result of extension
options
Balance at 1 July 2019
Current lease liabilities
Non-current liabilities
Balance at 1 July 2019
Total
$’000
2,226
(179)
(570)
124
1,601
529
1,072
1,601
The lessee’s weighted average lessee’s incremental borrowing
rate applied to lease liabilities on 1 July 2019 was 4.19%
(b) Movement schedule 1 July 2019 to 28 June 2020
(c) Maturity Analysis
The movement in the lease liability from the date of transition
to 28 June 2020 is as follows:
Opening balance on adoption of AASB
at 1st July 2019
Additions
Interest incurred
Payments on lease liabilities
Less: lease contract terminated
Balance at 28 June 2020
Current lease liabilities
Non-current liabilities
Balance at 28 June 2020
Total
$’000
1,601
111
Within One Year
One to two years
Two to three years
Three to four years
Four to fi ve years
59
Total Contractual Undiscounted Cash Flows
(549)
(20)
1,202
456
746
1,202
Discounting using the lessees incremental
borrowing rate
Balance at 28 June 2020
(d) Amount recognised in profi t and loss
The movement in the right-of-use asset from the date of
transition to 28 June 2020 is as follows:
Right-of-use
assets
Plant
&
Equipment
Total
Property
Balance at 1 July 2019
Additions
Less: lease contract
terminated
Depreciation charge for
the year
Balance at 28 June
2020
$’000
1,152
-
-
$’000
$’000
478
1,630
112
(20)
112
(20)
(372)
(180)
(552)
780
390
1,170
Depreciation expense on right-of-use assets
Interest expense on lease liabilities
Impact on fi nancial performance
The overall earnings impact for the period ended 28 June 2020
arising from the adoption of AASB 16 is:
■ An increase in EBITDA of $549 thousand and a corresponding
increase in depreciation of $552 thousand. This has resulted in
a reduction in EBIT of $3 thousand.
■ An increase in interest expense of $59 thousand. In
combination with the reduction in EBIT, this has resulted in a
reduction in net profi t before tax of $62 thousand.
Total
$’000
456
472
305
25
11
1,269
(67)
1,202
Total
$’000
552
59
74
75
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS [CONT]
15. OTHER INTANGIBLE ASSETS
Gross carrying amount
Balance at 1 July 2018
Additions
Balance at 30 June 2019
Additions
Balance at 28 June 2020
Accumulated Impairment/Amortisation
Balance at 1 July 2018
Amortisation expense
Impairment
Balance at 30 June 2019
Amortisation expense
Balance at 28 June 2020
Net book value as at 30 June 2019
Net book value as at 28 June 2020
Brand Names
at cost
Software at
cost
$’000
$’000
Total
$’000
20,929
77
21,006
89
1,929
77
2,006
89
2,095
21,095
(1,740)
(119)
-
(1,859)
(82)
(1,941)
147
154
(6,201)
(119)
(2,185)
(8,505)
(82)
(8,587)
12,501
12,508
19,000
-
19,000
-
19,000
(4,461)
-
(2,185)
(6,646)
-
(6,646)
12,354
12,354
Brand names - Useful life assessment
The key assumptions used were as follows:
The Group assesses its brand names as having indefi nite useful
lives. This assessment has refl ected management’s intention to
continue to utilise the brand names within its portfolio for the
foreseeable future.
Each period, the useful lives of the Group’s brand names are
reviewed to determine whether events and circumstances
continue to support an indefi nite useful life assessment for
the assets.
The Group continue to believe that its remaining brand names
have indefi nite useful lives, as there is no foreseeable limit to
the period over which they intend to utilise the brand names.
Impairment testing - Indefi nite life brand names
Indefi nite life brand names are not subject to amortisation
and are tested annually for impairment, or more frequently
if events or changes in circumstances indicate that they might
be impaired. An impairment loss is recognised for the amount
by which the asset’s carrying amount exceeds its recoverable
amount. The recoverable amount is the higher of an asset’s
value in use and fair value less costs to sell. Brand names that
have incurred an impairment in previous periods are reviewed
for possible reversal of the impairment at the end of each
reporting period.
The Group used ‘relief from royalty’ method for the purposes of
impairment testing as at 28 June 2020.
■ An estimate of maintainable revenue with reference to the
FY21 budget and historic fi nancial performance, with due
consideration given to the economic uncertainty associated
with COVID-19.
■ Royalty rates ranging between 2% - 4.5% (2019: 2% - 4.5%)
■ Discount rate of 10% post-tax (2019: 10%)
■ Long term growth rates of between 0% - 3% (2019: 0% - 3%)
■ An estimate of costs to sell equivalent to 2% of the estimated
recoverable amount for each brand name.
As the COVID-19 pandemic continues to evolve, it is extremely
challenging to predict the full extent and duration of its impact
on the Group’s business activities. The Group believes that the
assumptions adopted in the ‘relief from royalty’ calculations
refl ect an appropriate balance between the Group’s experience
to date, the uncertainty associated with the COVID-19
pandemic and expected future performance for each brand, as
discussed in the Directors Report.
The Group has concluded that no impairment is required based
on current market and economic conditions and expected
future performance.
In the prior period, the Group recognised an impairment loss
for Country Life of $1.376 million (after tax $0.963 million),
which reduced the carrying value of the brand to $0.500
million. In addition, the Group fully impaired its Hi-Speed brand
resulting in an impairment loss of $0.081 million (after tax
$0.057 million) and wrote off $0.729 million (after tax $0.510
million) on the re-branding of the “Martha’s and “Lux”
under “Softly”.
16. OTHER ASSETS
19. BANKING FACILITIES
Prepayments
2020
$’000
301
2019
$’000
268
17. TRADE AND OTHER PAYABLES
2020
$’000
2019
$’000
Trade payables
11,354
11,976
Trade spend liabilities
122
139
Sundry payables
6,864
4,902
Summary of fi nancing
arrangements
Facilities utilised at
reporting date:
Multi option loan facility
- Bank Guarantee
- Bank overdraft
Facilities not utilised at
reporting date:
Multi option loan facility
2020
$’000
2019
$’000
177
-
177
177
1,177
1,354
18,340
17,017
- Bank Guarantee
4,810
3,633
The average credit period on the purchases of goods ranges
from 7 to 60 days. No interest is charged on the trade payables.
The Group has fi nancial risk management policies in place to
ensure that, as often as possible, all payables are paid within a
reasonable time frame.
18. OTHER FINANCIAL LIABILITIES
Current
Foreign currency forward
contracts
Supplier payment facility
2020
$’000
-
212
212
2019
$’000
26
-
26
The Group implemented a new American Express supplier
payment facility during the reported period. As at the reporting
date, the facility had a maximum limit of $4.3 million of which
$0.212 million was utilised.
- Bank overdraft
Multi option loan facility limit
Multi option loan facility
13
4,823
5,000
13
3,646
5,000
The Group has a multi option loan facility with the ANZ bank
that allows the Group to choose the appropriate type of
funding facility to suit its business needs under one interest
rate. The multi option facility can be used as a bank overdraft,
variable rate fully drawn advance, cash advance, standby letter
of credit/guarantee and/or trade fi nance facility.
The multi option facility has a facility limit of $5,000,000 (2019:
$5,000,000). The multi option facility bears an interest rate
of 0.94% plus a line fee of 0.8% as at 28 June 2020 (2019:
2.07% plus a line fee of 0.8%). The fi nancing arrangement
is secured by the Group’s assets through fi rst ranking fi xed
and fl oating charges over the Company and its subsidiaries
(with corresponding cross guarantee). The facility expires 31
October 2020. As at the reporting date, negotiations for a new
loan facility beyond expiration date were well advanced. The
Directors expect to place a new banking facility for a period
of 4 years prior to the expiry date of the existing facility. As
highlighted in Note 18, the Group has alternative fi nancing
facilities to draw upon, if and when required. There are no
restrictions of use associated with the supplier fi nance facility.
76
77
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS [CONT]
20. PROVISIONS
Current
Employee benefi ts
Make good provision on lease
Non-current
Employee benefi ts
2019
$’000
1,961
2020
$’000
2,225
29
In the event of winding up of the Company, ordinary
shareholders rank after all creditors and are fully entitled to any
proceeds of liquidation.
Changes to the then Corporations Law abolished the authorised
capital and par value concept in relation to share capital from
1 July 1998. Therefore, the company does not have a limited
amount of authorised capital and issued shares do not have a
par value.
2,254
1,961
22. DIVIDENDS
139
139
129
129
(a) Recognised Amounts
2020
2019
Cents
per
Share
Total
$’000
Cents
per
Share
Total
$’000
1.30
1,771
0.90
1,226
0.70
954
0.70
954
2.00
2,725
1.60
2,180
Fully paid
ordinary shares
Final dividend: Fully
franked at 30% tax
rate
Interim dividend: Fully
franked at 30% tax
rate
(b) Unrecognised Amounts
90,658
90,658
Special dividend
Final dividend
90,658
90,658
2020
2019
Cents
per
Share
1.50
0.70
2.20
Total
$’000
Cents
per
Share
Total
$’000
2,044
1.30
1,771
954
-
-
2,998
1.30
1,771
Total Provisions
2,393
2,090
The provision for employee benefi ts represents annual leave,
rostered days off and vested long service leave entitlements
accrued by employees. The increase in the carrying amount of
the provision for the current year results from more benefi ts
being accrued than paid in the current year. The provision is
discounted using high quality Australian corporate bond rates.
21. ISSUED CAPITAL
(a) Fully paid ordinary shares
2020
No.
2019
No.
136,250,633
136,250,633
136,250,633
136,250,633
$’000
$’000
Share Capital
Opening balance of ordinary
shares, fully paid
Balance at end of fi nancial
year
Fully paid ordinary
shares
Balance at beginning of
fi nancial year
Balance at end of
fi nancial year
Holders of ordinary shares are entitled to receive dividends as
declared from time to time and are entitled to one vote per
share at shareholders’ meetings.
(b) Categories of fi nancial instruments
2020
$’000
2019
$’000
Financial assets
Cash and cash equivalents
3,668
246
Trade and other receivables
(amortised cost)
Derivative instruments in
designated hedge accounting
relationships
Financial liabilities
Trade and other payables
(amortised cost)
Derivative instruments in
designated hedge accounting
relationships
20,133
17,617
340
-
18,340
17,017
-
26
The carrying amount refl ected in the statement of fi nancial
position represents the Group’s maximum exposure to credit risk
for fi nancial assets.
The Group has signifi cant credit risk exposure with Woolworths
Limited, Coles Group Ltd, Metcash Ltd, Costco, Foodstuffs
(Auckland) Ltd and Battery Specialists Groups which represent
73.94% of trade receivables.
The Directors declared a fully franked special dividend of 0.7
cents per ordinary share payable on 7 August 2020 with a record
date of 31 July 2020.
In respect of the year (52 weeks) ended 28 June 2020 , the
Directors declared a full year fully franked fi nal dividend of 1.5
cents per ordinary share, payable on 25 September 2020, with
a record date of 7 September 2020 (2019: 1.30 cents per
ordinary share).
2020
$’000
2019
$’000
18,496
18,426
1,285
759
Adjusted franking account
balance
Impact on franking account
balance of dividends not
recognised
23. FINANCIAL INSTRUMENTS
(a) Capital risk management
The Group manages its capital to ensure that entities in the
Group will be able to continue as a going concern while
maximising the return to stakeholders through the optimisation
of the debt and equity balance.
The capital structure of the Group consists of cash, occasional
short term deposits, and equity attributable to equity holders of
the parent, comprising issued capital (as disclosed in note 21),
reserves and retained earnings/(accumulated losses).
Operating cash fl ows and a multi option bank facility are used
in combination as required to maintain and expand the Group’s
assets, as well as to make the routine outfl ows of payables, tax,
dividends and pay for other fi nancial instruments. Refer to Note
19 for details of the banking facility.
Gearing ratio
The Board of Directors reviews the capital structure on an
ongoing basis. As a part of this review the Board considers the
cost of capital and the risks associated with each class of capital.
Based on recommendations of the Board, the Group will balance
its overall capital structure through the payment of dividends,
new share issues, and the issue or repayment of debt to execute
its strategic plans. The Group was effectively debt free, in a net
cash position (cash net of borrowings, overdrafts and other
fi nancial liabilities) in both the current and prior fi nancial year.
78
79
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS [CONT]
23. FINANCIAL INSTRUMENTS
(CONTINUED)
(c) Financial risk management objectives
The Group’s fi nance function provides services to the business
by monitoring and managing the fi nancial risks relating to the
operations through internal risk reports which analyse exposures
by degree and magnitude of risk.
The Group’s activities expose it primarily to the fi nancial risks of
changes in foreign currency exchange rates. The Group enters
into forward foreign currency contracts to manage its exposure
to foreign currency exchange rate fl uctuations where it has
entered into fi xed price contracts.
The Group does not enter into or trade fi nancial instruments,
including derivative fi nancial instruments, for speculative
purposes. The use of fi nancial instruments is governed by
the Group’s policies approved by the Board of Directors. The
Chief Financial Offi cer is responsible for managing the Group’s
treasury requirements in accordance with this policy.
(d) Market risk
The Group’s activities expose it primarily to the fi nancial risks of
changes in foreign currency exchange rates. The Group enters
into derivative fi nancial instruments to manage its exposure
to foreign currency risk, including forward foreign currency
contracts to manage its exposure to foreign currency exchange
rate fl uctuations (refer notes 23(c) and 23(e)).
(e) Foreign currency risk management
The Group undertakes transactions denominated in foreign
currencies; consequently, exposures to exchange rate
fl uctuations arise. Where appropriate, exchange rate exposures
are managed within approved policy parameters utilising
forward exchange contracts or by offsetting import and export
currency exposures.
The carrying amounts of the Group’s foreign currency
denominated monetary assets and monetary liabilities at the
end of the reporting period are as follows:
Assets
Liabilities
2020
2019
2020
2019
$’000
$’000
$’000
$’000
Currency of USA
-
-
Currency of New
Zealand
Currency of Fiji
Currency of Europe
Currency of China
3,726
2,017
-
-
-
18
-
15
337
728
-
1
-
312
266
-
51
-
Weighted
average
exchange rate
Foreign currency
FC’000
Contract value
$’000
Fair value
gain/(loss)
$’000
2020
2019
2020
2019
2020
2019
2020
2019
Buy USD – less than one year
0.6924
-
1,510
-
2,181
-
Sell NZD – less than one year
1.0197
1.0563
7,200
3,000
7,061
2,840
7
333
340
-
(26)
(26)
As at reporting date, the aggregate amount of unrealised gains/(losses) under forward foreign currency contracts relating to anticipated
future contracts is $0.340 million gain (2019: $0.026 million loss). In the current year, these unrealised gains/ (losses) have been deferred
in the hedging reserve to the extent the hedge is effective.
Forward foreign exchange contracts
Foreign currency sensitivity analysis
The Group enters into forward foreign exchange contracts
to hedge a proportion of anticipated sales and purchase
commitments denominated in foreign currencies (principally US
Dollars and New Zealand Dollars) expected in each month. The
amount of anticipated future sales is forecast in light of current
conditions in foreign markets, commitments from customers
and experience.
The following table sets out the gross contract value to be
received/paid under forward foreign currency contracts, the
weighted average contracted exchange rates and settlement
periods of outstanding contracts for the Group.
The Group is mainly exposed to USD and NZD currencies. The following table details the Group’s sensitivity to a 5 cent increase and
decrease in the Australian dollar against the relevant foreign currencies. The analysis includes derivative instruments in designated hedge
accounting relationships, all trade receivables and trade payables outstanding at year end.
USD Impact
EUR Impact
NZD Impact
FJD Impact
CNY Impact
2020
2019
2020
2019
2020
2019
2020
2019
2020
2019
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Profi t
Equity
43
79
30
-
-
-
7
-
137
170
82
179
-
-
-
-
-
-
-
-
(f) Interest rate risk management
The Group has been exposed to interest rate risk during the period as it invests cash on call at fl oating interest rates and cash in short
term deposits at fi xed interest rates. The Directors consider that the Group’s sensitivity to a reasonably possible change in interest rates
would not have a material impact on profi t or equity.
80
81
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS [CONT]
23. FINANCIAL INSTRUMENTS (CONTINUED)
(g) Credit risk management
(i) Fair value of fi nancial instruments
The following table details the Group’s exposure to interest rate and liquidity risk. The table includes both interest and principal
cash fl ows.
Weighted
average
interest
rate
2020
Less than
1 month
1-3
months
3 months
to 1 year
1-5 years
5+ years
$’000
$’000
$’000
$’000
$’000
Financial assets
Variable interest rate
instruments
Non-interest bearing
Financial liabilities
Variable interest rate
instruments (i)
Non-interest bearing
0.24%
3,668
-
-
-
-
10,798
14.466
212
9,271
9,483
9,335
9,335
-
9,069
9,069
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Weighted
average
interest
rate
2019
Less than
1 month
1-3
months
3 months
to 1 year
1-5 years
5+ years
$’000
$’000
$’000
$’000
$’000
Financial assets
Variable interest rate
instruments
Non-interest bearing
Financial liabilities
Non-interest bearing
0.95%
246
-
-
-
9,602
9,848
8,516
8,516
8,015
8,015
8,501
8,501
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
$’000
3,668
20,133
23,801
212
18,340
18,552
Total
$’000
246
17,617
17,863
17,017
17,017
(i) Relates to American Express supplier payment facility which, if applicable, charges interest at the time of utilisation and bears no interest charges for repayments made within
agreed time frame. The Group intends to repay the facility within agreed time frame.
Credit risk management refers to the risk that a counterparty
will default on its contractual obligations resulting in fi nancial
loss to the Group. The Group has adopted a policy of only
dealing with creditworthy counterparties and obtaining
suffi cient collateral, where appropriate, as a means of mitigating
the risk of fi nancial loss from defaults. The Group’s exposure
and the credit ratings of its counterparties are continuously
monitored and the aggregate values of transactions concluded
are spread amongst approved counterparties. The Group
measures credit risk on a fair value basis.
Trade accounts receivable consist of a number of customers
supplying the retail sector in Australia, New Zealand and
Asia. Ongoing credit evaluation is performed on the fi nancial
condition of accounts receivable and, where appropriate, credit
guarantees are obtained.
The Group has signifi cant credit risk exposure with Woolworths
Limited, Coles Group Ltd, Metcash Ltd, Foodstuffs (Auckland)
Ltd and Battery Specialists Groups which represent 73.94% of
trade receivables.
The credit risk on liquid funds and derivative fi nancial
instruments is limited because the counterparties are banks
with high credit-ratings assigned by international credit-rating
agencies.
The carrying amount of fi nancial assets recorded in the fi nancial
statements, net of any allowances for losses, represents the
Group’s maximum exposure to credit risk without taking
accounts of the value of any collateral obtained.
(h) Liquidity risk management
The Group manages liquidity risk by maintaining adequate
reserves, banking facilities and reserve borrowing facilities by
continuously monitoring forecast and actual cash fl ows and
matching the maturity profi les of fi nancial assets and liabilities.
The Group has a multi option loan facility with the ANZ bank
that allows the Group to choose the appropriate type of
funding facility to suit its business needs under one interest
rate. The facility expires 31 October 2020. As at the reporting
date, negotiations for a new loan facility beyond expiration
date were well advanced. The Directors expect to place a new
banking facility for a period of 4 years prior to the expiry date
of the existing facility. As highlighted in Note 18, the Group
has alternative fi nancing facilities to draw upon, if and when
required. There are no restrictions of use associated with the
supplier fi nance facility.
The directors consider that the carrying amounts of fi nancial
assets and liabilities recorded in the fi nancial statements
approximate their fair values.
The fair values and net fair values of fi nancial assets and
liabilities are determined as follows:
■ the fair value of fi nancial assets and fi nancial liabilities
with standard terms and conditions and traded on active
liquid markets are determined with reference to quoted
market prices;
■ the fair value of other fi nancial assets and liabilities are
determined in accordance with generally accepted pricing
models based on discounted cash fl ow analysis; and
■ the fair value of derivative instruments, included in hedging
assets and liabilities, are calculated using quoted prices, which
is a Level 2 fair value measurement. Where such prices are not
available use is made of discounted cash fl ow analysis using
the applicable yield curve for the duration of the instruments.
24. SHARE-BASED PAYMENTS
Executive Variable Incentive Plan (EVIP)
Under Pental’s EVIP, executives and selected senior
management employees are eligible for both a cash and equity
incentive upon the achievement of certain Group level KPI’s and
personal KPIs set at the commencement of each fi nancial year,
weighted as follows:
■ Fifty percent of both the cash and equity incentive KPIs relate
to the achievement of a target EBIT for the fi nancial year.
■ The remaining fi fty percent are based on specifi c KPIs
relevant to the participants particular specialisation.
Variable Incentive – cash
Variable cash incentive under EVIP is paid shortly after the
release of audited full year results. The maximum amount of
remuneration under the variable cash incentive plan ranges
from 20 to 35 percent of the individual executive / senior
management employee’s total fi xed remuneration.
82
83
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS [CONT]
24. SHARE-BASED PAYMENTS (CONTINUED)
Variable Incentive – equity
The variable equity incentive is designed to reward achievement of annual KPIs, assist the retention of key high performing executives
and align the rewards to the company’s share price. The maximum amount of remuneration under the variable equity incentive plan
varies from 30 to 40 percent of the individual executive / senior management employee’s total fi xed remuneration. The variable equity
incentive is delivered as Performance Rights (Rights), which are granted under the existing Executive Performance Rights Plan (Rights
Plan) to enable the subsequent acquisition of the share component. The Rights will convert to ordinary shares after three years from
the end of fi nancial year of the grant date. Rights will be granted on a face value basis using the last ten business days of the previous
fi nancial year Volume Weighted Average Price (VWAP). The variable equity incentive is based upon an assessment of performance
against respective KPIs in the year in which it is granted. If the performance criteria is not met within the fi nancial year, the Rights lapse
at the end of the same fi nancial year.
The vesting of the Rights is conditional on:
a) The executive satisfying Group level and personal performance criteria,
b) the executive being employed by the Group on the vesting date; and
c) Pental’s VWAP share price for the last ten business days preceding the vesting date being equal
to or greater than the VWAP for the preceding ten business days from the grant date.
In total, the Rights are held for four years from the grant date. The value to the executive / senior manager therefore is not at the grant
date, rather at the vesting date which is three years from the end of fi nancial year of the grant date.
Dividends are not payable on the Rights. Dividends are payable on ordinary shares after conversion of the Rights to ordinary shares.
EVIP – FY20 Performance
The following table contains details of total EVIP equity entitlements achieved by the executives and senior managers during the year:
EVIP 2020
Grant
date
1 July
2019
No. of
Rights
granted
Share
price at
grant
date(i)
Exercise
price
Expected
volatility
Performance
period
Risk free
rate
Expected
dividend
yield
Fair
value
at grant
date
1,625,000
$0.2921
Nil
45.95%
4 years
0.94%
5.52%
$0.159
(i) Volume Weighted Average Price (VWAP) based on closing share price of last 10 business days of fi nancial year 2019 and volume traded on each day in that period.
Source – Commonwealth Securities Limited.
No equity incentives were achieved by the executives or senior management employees in the previous fi nancial year under the EVIP as
the Company did not achieve the plan’s EBIT hurdles.
As per Note 7, The vesting period expense recognised during the period was $65 thousand (2019: reversal of $85 thousand)
Share-based payments (Rights Plan)
All performance rights under the EVIP are issued pursuant to the Executive Performance Rights Plan (Rights Plan). Under the conditions
of Rights Plan, Performance Rights are convertible to ordinary shares (with no exercise price) as at the vesting date which is 4 years from
the grant date (or 3 years from the end of the fi nancial year)
All Rights issued are convertible to ordinary shares at no consideration, subject to achieving any performance or other vesting
conditions.
The following table discloses changes in the Rights holdings of management personnel:
The following table discloses changes in the Rights holdings of management personnel:
Grant
date
Vesting
Date
Balance
at
1/7/2019
No.
Rights
granted
No.
Rights
vested
No.
Rights
forfeited
No.
Rights
lapsed
No.
Balance
at
28/6/2020
No.
Rights plan 2018
(i)
3/7/2017
1/7/2020
211,765
-
EVIP 2020
1/7/2019
1/7/2023
-
1,625,000
-
-
-
-
211,765
-
-
1,625,000
(i) issued under rights plan lapsed during the period as a result of the related performance conditions not being achieved.
No Rights or share options were granted in the previous
comparative period.
25. KEY MANAGEMENT PERSONNEL
COMPENSATION
Mr John Rishworth was paid a total of $17,600 (including GST)
in relation to consultancy services provided to the group after
his retirement date. A party related to Mr Rishworth was also
employed by the Group during the reported period. The terms
of employment were at arm’s length. The related party was
paid a remuneration of $15,006 during the period
The aggregate compensation of the key management
personnel of the Group is set out below
Equity interests in subsidiaries
2020
$’000
2019
$’000
Details of interests in subsidiaries are set out in note 12.
Sales to and purchases from related parties in the normal course
of business are made in arm’s length transactions on normal
terms and conditions.
Short-term employee benefi ts
1,231,577
976,539
Share based payments
36,093
(56,992)
27. CASH AND CASH EQUIVALENTS
Termination benefi ts
-
8,205
(a) Reconciliation of cash and cash equivalents
Post-employment benefi ts
74,810
67,478
1,342,480
995,230
Cash and cash equivalents at the end of the fi nancial year as
shown in the cash fl ow statement is reconciled to the related
items in the statement of fi nancial position as follows:
Cash on hand and at bank
2020
$’000
3,668
2019
$’000
1,423
Bank overdraft
-
(1,177)
Cash and cash equivalents
3,668
246
26. RELATED PARTY TRANSACTIONS
As disclosed in information about the Directors, Mr Fred
Harrison is the CEO of Ritchies. Mr Harrison’s employer, Ritchies
Stores Pty Ltd invoiced the Group a total of $236,351.88
(including GST) relating to the Group’s participation in various
promotional activities and supplier trading terms during the
fi nancial year. All transactions were conducted at arm’s length.
As at the reporting date, the Group owed Ritchies Stores Pty Ltd
$36,300 in relation to above mentioned promotional activities
and supplier trading terms.
Mr Peter Robinson was paid a total of $19,000 (including GST)
in relation to consultancy services provided to the Group after
his retirement on 31 December. A party related to Mr Robinson
was employed by the Group during the reported period. The
terms of employment were at arm’s length. The related party
was paid a remuneration of $131,058 during the period.
84
85
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
NOTES TO THE FINANCIAL STATEMENTS [CONT]
27. CASH AND CASH EQUIVALENTS
(CONTINUED)
(b) Reconciliation of Profi t for the year to net cash fl ows
from operating activities
2020
$’000
5,019
4,576
-
-
1
65
2019
$’000
1,921
3,316
-
2,185
15
(85)
Profi t/(Loss) for the year
Depreciation and
amortisation expense
Impairment of goodwill
Impairment of brand names
Loss on disposal of assets
Equity settled employee
benefi ts expense
Changes in net assets and liabilities, net of effects
from acquisition of businesses:
(Increase)/decrease in assets:
Trade and other receivables
(2,516)
(3,100)
Inventories
Other assets
Increase/(decrease) in
liabilities and reserves:
Trade and other payables
Provisions and hedging
reserve
Current and deferred tax
liabilities
(642)
(11,807)
(373)
235
1,323
531
5,533
56
547
(725)
Other liabilities
(26)
26
Net cash from operating
activities
8,505
(2,430)
28. CAPITAL EXPENDITURE COMMITMENT
31. PARENT ENTITY INFORMATION
32. SUBSEQUENT EVENTS
Plant and equipment
2020
$’000
309
2019
$’000
255
The Group entered into various contracts to purchase
manufacturing equipment for the upgrade and modernisation
of Shepparton manufacturing facility.
29. CONTINGENT LIABILITIES
2020
$’000
177
2019
$’000
177
(a) Bank guarantees to third
parties in respect of property
lease obligations. The bank
guarantees are held by the
parent entity, Pental Limited.
To the best knowledge of the Directors aside from the Bank
Guarantees disclosed, no other contingent liabilities exist for the
reporting period ending 28 June 2020.
30. REMUNERATION OF AUDITORS
Auditor of the parent
entity
Audit or review of the
fi nancial report
Other services
- Tax compliance
- Tax consulting
- Other services
2020
2019
$
$
227,000
190,150
12,500
12,500
8,400
7,100
-
15,474
255,000
218,124
The auditor of Pental Limited is Deloitte Touche Tohmatsu.
The accounting policies of the parent entity, which have been
applied in determining the fi nancial information shown below,
are the same as those applied in the consolidated fi nancial
statements. Refer to Note 2 for a summary of the signifi cant
accounting policies relating to the Group.
Financial position
Assets
Current assets
Non current assets
Total assets
Liabilities
Current liabilities
Non current liabilities
Total liabilities
Net Assets
Equity
Issued capital
2020
$’000
1
54,877
54,878
1,382
-
1,382
2019
$’000
1
53,851
53,852
356
-
356
53,496
53,496
90,658
90,658
Accumulated losses
(37,162)
(37,162)
Total equity
53,496
53,496
Financial performance
Profi t/(loss) for the year
Other comprehensive
income
Total comprehensive
income/(loss)
2020
$’000
2,725
-
2019
$’000
(3,827)
-
2,725
(3,827)
Dividends
The Group declared a fully franked special dividend of 0.7 cents
per ordinary share payable on 7 August 2020 with a record date
of 31 July 2020.
In respect of the year (52 weeks) ended 28 June 2020 the
Company will pay fi nal fully franked dividend of 1.5 cents per
ordinary share, payable to shareholders on 25 September 2020,
with a record date of 7 September 2020.
Other than the above disclosures, there has not been any
matter or circumstance occurring subsequent to the end of
the fi nancial period that has signifi cantly affected, or may
signifi cantly affect, the operations of the Group, the results
of those operations, or the state of affairs of the Group in
subsequent fi nancial periods.
TIM
CAHILL
“It’s great to be part of
an Australian Company
making Australian
made products”
86
87
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
ADDITIONAL STOCK EXCHANGE INFORMATION AS AT 20 AUGUST 2020
Additional information required by the Australian Stock Exchange Limited Listing Rules and not disclosed elsewhere in this
report is set out below.
Ordinary share capital
136,250,633 fully paid ordinary shares are held by 1,789 individual shareholders.
Twenty largest holders of quoted equity securities
The voting rights attaching to the fully paid ordinary share, set out in clause 43 of the Company’s Constitution are:
“Subject to any rights or restrictions attaching to any class of shares:
(a) every member may vote;
(b) on a show of hands every member has one vote;
(c) on a poll every member has:
(i) for each fully paid share held by the member, one vote; and
(ii) for each partly paid share held by the member, a fraction of a vote equivalent to the proportion which the
amount paid (not credited) is of the total amounts paid and payable (excluding amounts credited to) on the share.”
Performance rights
There are no voting rights attached to performance rights.
On-market buy-back
There is no current on-market buy-back.
Distribution of holders of equity securities
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Holding less than a marketable parcel
Substantial shareholders
Ordinary shareholders
Alan Johnstone (i)
John Rostyn Homewood
Elevation Capital Management Ltd. (ii)
Fully paid ordinary shares
249
599
285
557
99
1,789
174
Fully paid ordinary shares
Number of shares
for voting power
Percentage
30,990,769
20,200,000
7,488,473
58,679,242
22.75%
14.83%
5.50%
43.08%
(i) Alan Johnstone has a relevant interest in Pental shares held by western park holdings pty Ltd, PMSF company pty Ltd and
Aurisch investments pty ltd
(ii) Elevation capital management Ltd. has a relevant interest in shares held by BNP Paribas noms (NZ) Ltd and BNP Paribas nominees pty ltd.
Ordinary shareholders
JOHNOS HOLDINGS PTY LTD
MR JOHN ROSTYN HOMEWOOD
MR GARRY GEORGE JOHNSON
BNP PARIBAS NOMS (NZ) LTD
J P MORGAN NOMINEES AUSTRALIA
DALLMOUNT CUSTODIANS PTY LTD
RATHVALE PTY LIMITED
CITICORP NOMINEES PTY LIMITED
P M S F COMPANY PTY LIMITED
DALLMOUNT PTY LTD
W A PEATT PTY LTD
DALLMOUNT PTY LTD
VANWARD INVESTMENTS LIMITED
SPORRAN LEAN PTY LTD
BUDUVA PTY LTD
NATIONAL NOMINEES LIMITED
BARKING DOG PTY LTD
DIXSON TRUST PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD
MRS JOY DOROTHY JOHNSTONE
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Fully paid ordinary shares
Number
Percentage
27,603,617
20,200,000
20.26%
14.83%
6,670,739
6,650,001
5,686,389
3,000,000
2,959,759
2,933,051
2,857,431
2,666,668
2,300,000
1,204,761
1,182,719
1,160,000
1,100,000
1,077,560
1,033,530
855,000
838,472
834,092
4.90%
4.88%
4.17%
2.20%
2.17%
2.15%
2.10%
1.96%
1.69%
0.88%
0.87%
0.85%
0.81%
0.79%
0.76%
0.63%
0.62%
0.61%
92,813,789
68.12%
88
89
PENTAL ANNUAL REPORT 2020
PENTAL ANNUAL REPORT 2020
PROTECTION
FOR THE
WHOLE FAMILY
for a powerful
clean
90
91
Directors
Mark Hardgrave
Charlie McLeish
John Etherington
Jeff Miciulis
Fred Harrison
Company Secretary
Oliver Carton
Registered Offi ce
Level 6, 390 St Kilda Road
Melbourne VIC 3004
Telephone: +61 3 9251 2311
Manufacturing and Distribution
18-22 Drummond Road
Shepparton VIC 3630
Telephone: +61 3 5820 5200
Shareholder enquiries:
Share Register
Boardroom Pty Limited
Grosvenor Place, Level 12,
225 George Street
Sydney NSW 2000
Telephone within Australia: 1300 737 760
Telephone outside Australia: +61 2 9290 9600
Facsimile: +61 2 9279 0664
www.boardroomlimited.com.au
Auditors
Deloitte Touche Tohmatsu
477 Collins Street
Melbourne VIC 3000
Australia
Phone: +61 3 9671 7000
Securities Exchange Listing
Pental Limited (PTL) shares are listed
on the Australian Securities Exchange (ASX)
Website
www.pental.com.au
ABN
29 091 035 353