ANNUAL
REPORT
20
22
ABN 95 009 211 474
Creating enduring
value and certainty
ABOUT US
We are a diversified global mining services group with interests in
contract mining, mining support services and future technology
solutions. The Group was founded in Kalgoorlie in 1987 and is today
one of the world’s largest mining service companies providing
surface and underground mining at scale. Our portfolio consists
of sustainable, inter-related and value-adding mining services and
technology focused businesses.
Headquartered in Perth, Australia, and operating across four
continents, our focus is to create enduring value and certainty
for our investors, clients, employees and the communities in
which we operate.
EMPLOYEES
PROJECTS
COMMODITIES
COUNTRIES
CONTINENTS
~9,000
62
9
11
4
AUSTRALIA
AFRICA & EUROPE
NORTH AMERICA
ABOUT THIS REPORT
This Annual Report is a
summary of Perenti and
its operations, activities
and financial position as
at 30 June 2022. All dollar
figures are expressed in
Australian dollars unless
otherwise stated.
This Report is printed on paper that
is manufactured from 100% recycled
fibre that is FSC Mix Certified. Both
paper manufacturer and printer are
certified to the ISO 14001 standard.
ii
ABN 95 009 211 474
CONTENTS
16
02
04
06
17
GROUP PERFORMANCE OVERVIEW
02
04
06
Our Updated
2025 Strategy
Year in Review -
Performance and
Sustainability
A message from the
Chair and Managing
Director & CEO
10
Group
Executive
11
Perenti
Organisational
Structure
12
Financial
Review
16-17
Our People
and HSE
OPERATING OVERVIEW
18
Contract
Mining
18
24
Mining
Services
26
idoba
24
29
53
Sustainability
Report
Governance
and Risk
59
Financial
Report
163
Glossary
29
26
PERENTI – ANNUAL REPORT 2022
1
vvv GROUP PERFORMANCE OVERVIEW
OUR UPDATED
2025 STRATEGY
Perenti has made
significant progress
against our 2025 Strategy
which was launched in
February 2019. We have
stabilised the business,
recycled cash, invested in
our business foundations
and positioned Perenti
for the future.
In 2022, the Perenti Board and the
Group Executive completed a review
of our 2025 Strategy, taking into
consideration the Group’s performance
as well as a range of domestic and
global economic and industry trends.
These included COVID-19, technology
adoption, the growing focus on
sustainability, global uncertainty and the
energy revolution and decarbonisation.
As a result of the review, we are
implementing important changes
to our strategy as we see significant
opportunity for our business into the
future. Our updated 2025 Strategy has
been designed to capitalise on these
shifts and to deliver improved returns
through disciplined capital investment.
OUR STR ATEGY IS TO DELIVER COMPETITIVE
TOTAL SHAREHOLDER RETURNS (TSR)
We do this by building a portfolio of complementary
businesses that deliver consistent and quality cash
backed profits to create enduring value for our clients,
our people and our investors.
We attract, retain
and engage great
people
OUR
PEOPLE
TO CREATE
ENDURING
VALUE AND
CERTAINTY
OUR
INVESTORS
We generate
competitive returns
that in turn attract
further capital
investment
OUR
CLIENTS
We win and
extend the work
that supports
our strategic
objectives
SUSTAINABILITY
EMBEDDED IN
EVERYTHING WE DO
HOW THE
GROUP
CREATES
VALUE
TOGETHER
OUR
PRINCIPLES
2
OUR UPDATED 2025 STRATEGY
CONTR ACT MINING
We are a global contract
miner, with widely
recognised brands who
combines industry-leading
mining technologies,
demonstrated mining
expertise and the relentless
pursuit of operational
improvements to meet
and exceed our clients'
expectations.
MINING SERVICES
We are a portfolio of
industry-leading businesses
who work closely with
clients across the mining
sector to deliver value-add
services that meet current
and emerging needs.
IDOBA
We are a technology
informed services business
who provide unique end to
end digital, technology and
consulting services designed
to rethink, transform and
disrupt the mining industry
and beyond.
Blended portfolio to deliver competitive TSR
CORPOR ATE CENTRE
We support and enhance the long-term success of the Group by ensuring development
of current and future Perenti leaders, investing capital to deliver future growth, promoting
our brand and safeguarding our reputation.
NO
SHORTCUTS
NEVER
WASTEFUL
WALK IN
THEIR SHOES
SMARTER
TOGETHER
ENABLE
TOMORROW
ABN 95 009 211 474 DELIVERING
THROUGH OUR
STRATEGIC
FOCUS AREAS
BUSINESS
PERFORMANCE
As part of our strategy we are focused on continuous
improvement across all our contracts. In recent times, we
have been successful in securing rate improvements at
projects in Western Australia and Senegal - a testament to
the quality of the service we provide and the strength of the
relationship with our clients.
CAPITAL
MANAGEMENT
Through our Capital Management Policy, Perenti has
adopted a measured and structured approach to deploying
capital to our business to ensure we can offer long-term
sustainable returns to shareholders. The recent share
buyback program announced on the back of the
divestments of non core businesses and property assets, is
one way of delivering greater value for shareholders.
ORGANISATIONAL
HEALTH
To support our focus on delivering competitive shareholder
returns, Perenti announced a strengthened business model
that comprises three complementary divisions: Contract
Mining, Mining Services and idoba, our digital platform
offering. The new structure is underpinned by a simplified
operating model that focuses on culture, leadership and
empowering employees through clear accountabilities and
‘fit for purpose’ business tools. Our organisational health
is a key competitive advantage for Perenti and is critical to
delivering on our updated 2025 Strategy.
PEOPLE AND
CULTURE
DATA AND
ANALY TICS
To forge a culture where our people can successfully
deliver for all stakeholders, we need to provide a safe,
diverse and inclusive workplace. Our It’s Not OK campaign,
a collaboration between multiple stakeholders, seeks to
eliminate harmful behaviours, including sexual assault,
sexual harassment, other forms of harassment and bullying,
from our workplace. The program reflects Perenti’s strong
commitment to the physical and psychological safety,
respect and wellbeing of everyone at our workplaces.
In February 2022, Perenti’s technology platform
provider idoba and Sumitomo Corporation, entered into
a Memorandum of Understanding for the co-creation
and joint development of digital mining products for the
advancement of sustainable mining practices. The two
companies have worked collaboratively to initiate
My Performance Navigator, a mining process optimisation
service that connects and analyses mine data to predict
future performance and provide decision support.
GROUP PERFORMANCE OVERVIEW
OUR UPDATED
2025 STRATEGY
PERENTI – ANNUAL REPORT 2022
3
GROUP PERFORMANCE OVERVIEW
YEAR IN REVIEW
UNDERLYING REVENUE
UNDERLYING EBITDA
UNDERLYING EBIT(A)
$2.4B
$426M
$176M
Up 21% on FY21
Up 12% on FY21
Up 3% on FY21
In-line with revised FY22 guidance range.
Up and in-line with increasing earnings
contribution from growth projects.
Exceeded revised FY22 guidance range.
UNDERLYING NPAT
UNDERLYING CASH CONVERSION1
UNDERLYING LEVERAGE
$82M
Up 6% on FY21
$108%
1.3x
Up on stronger overall business
performance.
Second consecutive period of +100%
cashflow conversion.
Leverage in-line with FY21 and
outperformed revised FY22 guidance.
UNDERLYING ROACE2
SPIFR
15.2%
Up 93bps
2.8
TRIFR
6.9
Increase on Underlying FY21 ROACE.
Serious Potential Incident Frequency
Rate reduced from 2.9 to 2.8 in FY22.
Total Recordable Injury Frequency Rate
increased from 5.1 to 6.9 in FY22.
1
2
Cashflow conversion is operating cash flows before interest and tax divided by underlying EBITDA. Proceeds from divestments are excluded from cashflow conversion figures.
ROACE is defined as underlying EBIT(A) / sum of average receivables, inventories, PP&E including assets classified as held for sale and right of use assets less trade payables for
the relevant period.
All references, unless specifically provided, relate to underlying figures and a reconciliation to statutory results is on page 13.
NAVIGATING THROUGH
UNPRECEDENTED
CHALLENGES
COVID-19
COUNTRY
& BORDER
RESTRICTIONS
LABOUR
CONSTRAINTS
SUPPLY CHAIN &
INFLATIONARY
PRESSURES
GEOPOLITICAL
CONFLICTS
4
YEAR IN REVIEW
ABN 95 009 211 474
GROUP PERFORMANCE OVERVIEW
EMBEDDING
SUSTAINABILITY IN
EVERYTHING WE DO
Sustainability is central to Perenti’s purpose to create enduring
value and certainty and to our 2025 Strategy. To deliver on our
purpose requires us to not only be consistently profitable but
also plan and operate in a responsible manner.
Established a Sustainability Committee with a focus on business-
wide improvement in safety, health, environment, climate, social
performance and human rights.
Refer to page 34 in the Sustainability Report
Launched Perenti’s It’s Not OK campaign that aims to eliminate sexual
assault, sexual harassment and other harmful behaviours from our
workplace.
Refer to page 48 in the Sustainability Report
Utilising technology to keep our people safe by working to develop a
collision avoidance system for underground mining.
Refer to page 44 in the Sustainability Report
Introduced CheckMate, a tool for frontline employees to ‘check’ the
critical safety controls are in place and working effectively prior to
commencing work.
Refer to page 43 in the Sustainability Report
Focusing on reducing our carbon emissions through introducing energy
efficiency programs, trialling low carbon technology to accelerate
decarbonisation at new and existing projects.
Refer to page 38 in the Sustainability Report
Investing in the development of African communities through our
training centre in Botswana which was recognised by the Australia-
African Minerals & Energy Group (AAMEG) as the Best Workforce and
Industry Development Initiative, at 2021 Africa Awards.
Refer to page 49 in the Sustainability Report
PERENTI – ANNUAL REPORT 2022
5
5
w PERENTI – ANNUAL REPORT 2022 GROUP PERFORMANCE OVERVIEW
A MESSAGE FROM
THE CHAIR
AND MANAGING
DIRECTOR & CEO
OUR
VISION
FOR THE
FUTURE
In our third year as
Perenti, we have
updated our strategy
and operating model
to ensure we deliver
competitive shareholder
returns, whilst continuing
to deliver value and
certainty to our clients
and employees in a
constantly changing
global environment,
through a simplified
business model, prudent
capital management
and a technology driven
future.
The 2022 Financial Year saw
robust demand for our services
on the back of healthy commodity
markets. This robust demand was
set in an environment of significant
inflationary pressures and other
complexities driven by the ongoing
COVID-19 pandemic and the war
in Ukraine. Against these external
headwinds, our continued focus
on financial and operational
performance delivered full year
revenue of $2.4 billion, exceeding
our expectations from the start of
the year. This revenue translated into
a solid underlying EBIT(A) result of
$176.3 million, which exceeded the
top end of our revised guidance.
Pleasingly, we saw a notable step up
in our performance in the second
half of the year as some of the
COVID-19 challenges started to ease.
Underpinning this performance are
our 9,000 employees who continue
to demonstrate resolve in the face
of the challenges presented by
the ongoing pandemic and other
economic factors. We remain
hugely proud of our people and
their ability to adapt to the changing
landscape over the past three years
and to deliver results that are ahead
of expectations. We look forward
to the continuation of this positive
momentum into the new financial
year.
SAFET Y
The target we set for the safety of
our people is simple – No Physical or
Psychological Life Changing Events.
Tragically we failed in this objective
as we lost three employees this
year. Baleseng Sechele and Moses
Marpaung were fatally injured in
an underground incident at the
Zone 5 Project in Botswana in May
2022, and Troy Cameron was fatally
injured in an underground incident
at the Hemlo Project in Canada in
July 2021. We extend our deepest
sympathies to the families, friends
and colleagues of Baleseng, Moses
and Troy. Further detail as to the
response to these events is outlined
below and included in the Safety and
Sustainability sections of this report
(refer pages 17 and 41 respectively).
We continued to embed our
Critical Risk Management Program
during the year, which ensures
critical controls are identified and
implemented to prevent potentially
fatal events and empowers frontline
workers and leaders to verify that the
right life-saving controls required for
a specific activity are in place and
effective, prior to starting work.
The year also saw the rollout of
a standardised HSE information
system across all of our locations.
6
A MESSAGE FROM THE CHAIR AND MANAGING DIRECTOR & CEO
ABN 95 009 211 474 This replaced two separate systems,
and for the first time provided a
common platform and single source
of truth for managing HSE data across
the organisation. This enables better
understanding of performance and helps
provide insights for risk-based decision
making and supports meeting our
strategic objectives for HSE.
We continue to develop the skills of
our leaders to manage safety in every
aspect of their roles. As part of this
development, we rolled out our Thinking
Differently about Safety Program to
senior leaders across the business.
The program is designed to challenge
conventional thinking around aspects
of safety and promote courageous
leadership, risk management and culture.
Despite these meaningful initiatives, our
recent safety performance is not meeting
the standard we set ourselves. We
have identified a number of immediate
actions and we recognise we need
to do more. A comprehensive safety
transformation plan has been developed
and will be finalised upon completion of
the investigation into the recent deaths
of our colleagues at Zone 5. This plan
includes an initial detailed review of
the safety culture and capability across
the Contract Mining Division to help
understand where we are doing things
well, current deficiencies and where
additional organisational support is
required as part of further improvement.
2025 STR ATEGY
Three years into our 2025 Strategy, and
in consideration of both external and
internal factors, we took the opportunity
to refresh our strategy to ensure that we
continue to deliver enduring value and
certainty for our stakeholders.
Since its inception in early 2019, we have
made significant and positive progress
against our original 2025 Strategy,
including securing new projects in the
tier one mining jurisdictions Australia,
Botswana and Canada; stabilising and
divesting some elements of our business
that had been underperforming or were
not seen as core; and making significant
progress in upgrading legacy systems
and processes that are needed to better
integrate our diverse businesses.
In July 2021 we launched idoba, our
future-focused digital and innovation
business, that provides us with long-
term internal and external growth
opportunities. The business requires low
capital investment and will leverage the
significant information and data from the
world-renowned brands in our Contract
Mining Division, namely Ausdrill,
Barminco, AMS and AUMS. We have also
strategically positioned sustainability to
be at the forefront of our business.
Simplifying our business to focus on our
core competencies is also a strategic
objective for Perenti. During the year
we divested a range of non-core assets
including MinAnalytical, Well Control
Solutions and our investment in Chrysos,
generating $134.7 million (excluding
transaction costs) for the business. This
allowed us to pay down debt as we move
towards a more sustainable leverage
target and initiate a share buyback that
coincided with our 2025 Strategy update
in June.
Having made considerable progress
against our strategy, the update drives a
renewed focus on delivering competitive
total shareholder returns. To achieve this,
we have simplified our business structure
and created a new operating model
which provides for greater clarity and
accountability for our three operating
divisions and a smaller, more strategically
focused corporate centre:
• Contract Mining – We are a
global contract miner, with widely
recognised brands who combines
industry-leading mining technologies,
demonstrated mining expertise and
the relentless pursuit of operational
improvements to meet and exceed
our clients' expectations;
• Mining Services – We are a portfolio
of industry-leading businesses who
work closely with clients across
the mining sector, to deliver value-
add services that meet current and
emerging needs;
•
idoba – We are a technology
informed services business who
provide unique end to end digital,
technology and consulting services
designed to rethink, transform and
disrupt the mining industry and
beyond;
• Corporate Centre – We support and
enhance the long-term success of
the Group by ensuring development
of current and future Perenti leaders,
investing capital to deliver future
growth, promoting our brand and
safeguarding our reputation.
As part of our 2025 Strategy update,
we have committed to embedding
sustainability into everything we
do and set revised targets around
critical business metrics, including
higher EBIT(A) margins, lower capital
expenditure, reduced leverage and
stronger free cashflow.
A revised Capital Management Policy
was announced in December, under
which we will focus on the allocation
of capital aligned with our strategic
priorities, but most importantly, to
generate competitive shareholder
returns.
GROUP PERFORMANCE OVERVIEW
OUR 2025 TARGETS
HEALTH & SAFETY
No life
changing
events
ROACE
20%
EBIT(A) MARGIN
10%
REVENUE
$2.5B
LEVERAGE
<1.0x
INVESTOR QUESTION
Q: You updated the 2025
Strategy, what are the
primary components of this?
Our 2025 Strategy update outlined
a greater focus on shareholder
returns through improved project
performance, disciplined capital
management and a refined
business and operating model.
To demonstrate our commitment
to improvements, we outlined
several FY25 targets that illustrate
the growth potential of the
business.
7
PERENTI – ANNUAL REPORT 2022 RON
SAYERS
It is with great sadness that Ausdrill founder and mining
industry pioneer Ron Sayers passed away in May 2022.
Ron was a true legend of the industry, a trailblazer who
built a successful international business from a one drill rig
operation and humble beginnings in Kalgoorlie.
GROUP PERFORMANCE OVERVIEW
Through our Contract Mining Division,
we will continue to focus on more
measured growth in the key mining
markets of Australia, Botswana and
North America. The recent award of the
Cowal contract in New South Wales,
Australia, is an example of the type of
long-term opportunity we will strive for
in our Contract Mining Division.
Our Mining Services and idoba divisions
are set up for long-term growth in future
focused sectors of the industry with
reduced capital intensity. These divisions
leverage our strengths and relationships
in the Contract Mining Division, and
are critical for building our blended
portfolio, that provides a platform for
increasing our free cash flow to generate
shareholder returns.
OUR PEOPLE ARE OUR DIFFERENCE
Perenti’s story has changed over the
years – but it started with one man,
Ron Sayers, who sadly passed away
in May this year.
Ron was a pioneer of the mining industry
for more than 40 years in Australia and
Africa. He started Ausdrill in Kalgoorlie
in 1987 and through his entrepreneurial
spirit continued building this business
until his retirement in 2018. On behalf of
the Board and the entire organisation,
we appreciate what Ron did for the
industry and our Company. We extend
our sympathies and best wishes to Ron’s
family and many friends.
One of Ron’s great legacies is Perenti’s
commitment to training and developing
people. Our reputation for investing
in our people has been a key strategic
advantage in attracting and retaining
talent in the current highly competitive
labour market, particularly in Western
Australia.
We are proud to be one of the largest
private sector employers of apprentices
and trainees in Western Australia with
more than 435 people being part of our
programs in FY22.
This year we also expanded our Graduate
Program to include international
graduates, continued to operate our two
world class training centres in Australia
and Africa, as well as invest in our leaders
of tomorrow through a range of bespoke
programs.
This year we welcomed Tim Longstaff
and Craig Laslett to our Board. Tim has
an extensive background in investment
banking and corporate finance and
Craig is an experienced mining and
construction executive.
Perenti Managing Director & CEO Mark Norwell talks with employees at the Mako Project in Senegal.
8
A MESSAGE FROM THE CHAIR AND MANAGING DIRECTOR & CEO
ABN 95 009 211 474 GROUP PERFORMANCE OVERVIEW
Perenti subsidiary
AUMS provided solar
panels, batteries and
lighting to classrooms
at the Pahin Public
Primary School,
in Burkina Faso.
A SUSTAINABLE FUTURE
Our approach to sustainability continues
to evolve and as outlined in our 2025
Strategy update in June, our focus
will be on embedding sustainability in
everything we do. During the period,
a Sustainability Committee was
established, with Non-executive director
Tim Longstaff appointed as the chair and
Alex Atkins and Mark Hine appointed as
committee members.
The Company also released our Human
Rights Policy as well as initiating our
It’s Not OK campaign, a collaboration
between multiple stakeholders and a
crucial program of work that seeks to
eliminate harmful behaviours, including
sexual assault, sexual harassment, other
forms of harassment and bullying, from
our workplace. The program reflects
Perenti’s strong commitment to the
physical and psychological safety,
respect and wellbeing of everyone at
our workplaces.
Following analysis of results from
an internal survey and focus groups
conducted during early 2022, and in
conjunction with recommendations
from federal and state enquiries
including the Enough is Enough report,
a detailed improvement plan is currently
being developed. The plan will help
us eliminate harmful behaviours and
improve the physical and psychological
safety of our workforce.
We are also transitioning in a way that
puts sustainability at the heart of our
business. Our decarbonisation roadmap,
currently being developed, will drive
our commitment to helping reduce
our greenhouse gas emissions, which
decreased by 23% in FY22 on the back of
the divestment of several businesses and
a reduction in operational facilities. We
are part of the Electric Mine Consortium,
which is pursuing the electrification of
vehicles in underground mines – a key
precursor to powering underground
operations with renewable energy.
Through idoba, we are developing
services and strategies that will help our
clients reduce their emissions. idoba’s
Memorandum of Understanding with
Sumitomo will see the co-creation
and the joint development of digital
mining services, including mine process
optimisation and carbon footprint
management.
The communities that host us also
sustain us. They provide us with the
people who work on our projects and
they work hard to create shared value
and develop capability, so that when
our businesses leave, we also leave a
positive and enduring legacy. We are
proud that local employment in our
international operations has increased
to 89% in FY22. In addition, our training
centre in Botswana was recognised by
the Australia-African Minerals & Energy
Group (AAMEG) as the Best Workforce
and Industry Development Initiative at
the 2021 Africa Awards – a reflection of
our significant investment in the African
communities in which we operate (more
details on page 49).
LOOKING AHEAD
We are excited about the next
12 months. Our strong second half
operational and financial performance,
combined with our updated 2025
Strategy, focus on capital management,
business performance and a new and
more accountable operating model,
has us confident that we are on a
path to deliver a significant step-up in
performance in FY23 with continued
improvement through to FY25.
Finally, on behalf of the Board and the
Group Executive, we thank all of our
9,000 people, across the world, who
have been resilient, innovative and
creative in the way they have helped
us negotiate the challenges of the year.
We can’t thank them enough for
their pride in our business and their
commitment to creating enduring
value for our clients.
We also thank our shareholders,
our clients and our suppliers for their
ongoing support. We look forward to
reporting again in 2023.
Rob Cole
Chair
Mark Norwell
Managing Director & CEO
9
PERENTI – ANNUAL REPORT 2022
GROUP PERFORMANCE OVERVIEW
THE PERENTI
GROUP EXECUTIVE
M A R K N O RW E L L
MANAGING DIRECTOR &
CHIEF EXECUTIVE OFFICER
P E T E R B RYA N T
CHIEF FINANCIAL OFFICER
B E N DAV I S
CHIEF PEOPLE AND
SUSTAINABILITY OFFICER
Mark was appointed as the Managing
Director & CEO of Perenti in September
2018. Mark has more than 20 years’
experience in the mining industry
throughout Australia, New Zealand,
Africa and the Americas.
Peter is a CFO with more than
30 years' experience. He has served
in various executive roles across the
mining, construction and media sectors.
With experience spanning more than
20 years, Ben has held a number of
operational, corporate and executive
functional roles across Australia,
Africa and North America.
PAU L M U L L E R
CHIEF EXECUTIVE OFFICER
CONTRACT MINING
V I V I E N N E P OW E
CHIEF EXECUTIVE OFFICER
MINING SERVICES
S A R A H CO L E M A N
CHIEF EXECUTIVE OFFICER
IDOBA
Paul has more than 20 years' experience
in the mining industry, working for both
mining services providers and mine
owners in Australia, Asia and Africa.
Vivienne is a senior executive with more
than 30 years' experience and a strong
track record of creating shareholder
value in global mining and oil and gas
companies.
Sarah has more than 20 years' mining
and management consulting experience
with an impressive background spanning
operations, improvement, innovation,
technology and asset management.
J O S H B OV E L L
R A J R AT N E S E R
CHIEF INFORMATION OFFICER
CHIEF LEGAL AND RISK OFFICER
Josh has more than 20 years’ experience
throughout Australia, Asia and North
America in the information systems
and technology industry and has held
leadership roles in organisations operating
across a broad range of sectors.
Raj is a senior executive with more than
25 years’ national and international
experience across legal, commercial,
governance, risk and internal audit
primarily in the resources, engineering
and construction industries.
10
LEADERSHIP TEAM
ABN 95 009 211 474 PERENTI ORGANISATIONAL
STRUCTURE
GROUP PERFORMANCE OVERVIEW
We are a global contract miner, with
widely recognised brands who combines
industry-leading mining technologies,
demonstrated mining expertise and
the relentless pursuit of operational
improvements to meet and exceed
our clients' expectations.
We are a portfolio of industry-leading
businesses who work closely with
clients across the mining sector, to
deliver value-add services that meet
current and emerging needs.
We are a technology informed services
business who provide unique end to
end digital, technology and consulting
services designed to rethink, transform
and disrupt the mining industry and
beyond.
PERENTI ORGANISATIONAL STRUCTURE
11
PERENTI – ANNUAL REPORT 2022 GROUP PERFORMANCE OVERVIEW
FINANCIAL REVIEW
STRONG FINANCIAL
PERFORMANCE
GROUP PERFORMANCE
UNDERLYING RESULTS
REVENUE
By project (%)
• Top Project
• Top 2-10 Projects
• Top 11-20 Projects
• All others
6
40
23
31
Not reliant on any one project for revenue.
By country (%)
• Australia
• West Africa
• Botswana
• Southern Africa
• North America
47
37
8
7
4
Revenue from tier one mining jurisdictions increased
from 44% to 60%.
By commodity (%)
• Gold
• Nickel
• Copper
• Zinc
• Manganese
• Iron Ore
• Mixed Coal
• Other
64
11
8
4
2
2
3
6
Reduced reliance on gold projects but revenue from
battery minerals increased from 18% to 25% .
Battery Minerals
CORPOR ATE OVERVIEW
During FY22, Perenti’s business
continued to evolve. The update of the
2025 Strategy in June 2022 resulted in
a change to our business model with
the three historic core service offerings,
Underground Mining, Surface Mining and
Investments, transitioning to Contract
Mining, Mining Services and idoba.
The Contract Mining Division, which
currently represents 94.0% of Perenti’s
revenue, operates both surface and
underground mining services with
more than 60 projects. The portfolio
of projects are geographically diverse
with an increasing focus on the tier
one mining jurisdictions of Australia,
Botswana and North America. During
FY22 Contract Mining projects within
these tier one mining jurisdictions
contributed 53% of total revenue, up
from FY21.
Our Mining Services and idoba
divisions are set up for long-term growth
with a lower capital intensity. These
divisions leverage our strengths and
relationships in our Contract Mining
Division, and make up the blended
portfolio, that provides a platform
for improved margins and return on
investment. In FY22, the consolidated
Mining Services and idoba divisions
contributed 6.0% of total revenue.
FINANCIAL RESULTS
Perenti delivered strong revenue
growth for the year ending 30 June
2022 as robust demand for our services
continued off the back of healthy
commodity markets. Revenue was
$2.4 billion, an increase of 20.6% over
the previous financial year’s revenue
of $2.0 billion. This growth was largely
attributable to the ramp-up of several
growth projects across our portfolio,
primarily in the tier one jurisdictions
of Australia, Botswana and North
America and. As these growth projects
continued to progress through their
respective ramp-up phases, the positive
impact of their increasing earnings
contribution was and will continue to be
reflected in the consolidated results.
Underlying EBIT(A) for Perenti was $176.3
million up by 3.2% on the previous years
result of $170.8 million. The EBIT(A)
margin of 8.4% in FY21 softened to 7.2%
in FY22 mainly due to headwinds in the
macroeconomic environment.
These headwinds include a tight
Australian labour market, supply
chain constraints, general inflationary
pressures and other complexities driven
by the ongoing COVID-19 pandemic,
all of which continued to impact the
business during the year. Pleasingly,
there was a notable step-up in our
EBIT(A) margin in the second half of
FY22 (‘2H22’) driven by improvements
in operational productivity and
the outcomes of recent contract
negotiations which resulted in several
increases. This positive trend is expected
to continue into FY23 and Perenti is well
positioned to deliver its targeted EBIT(A)
margin of 10% by 2025.
The Group reported a statutory
Net Profit After Tax (NPAT) for the year
of $42.5 million, an improvement of
$92.3 million when compared to the
statutory loss of $52.3 million posted
in FY21. The FY22 statutory result
was impacted by non-underlying
adjustments mainly related to the
amortisation of client related intangibles,
impairments and provisions recorded
relating to country exits for Egypt and
Mali and offset by the profit on sale
from the divestment of MinAnalytical
and other positive tax impacts.
CONTR ACT MINING
The Contract Mining Division contributed
94.0% of the Group’s total revenue and
underlying EBIT(A) before corporate
overheads. Within Contract Mining our
underground business contributed 71.3%
and 80.8% of Group revenue and EBIT(A)
before corporate overheads. In-line with
the commencement of new contracts,
underground mining revenues increased
by 17.7% in FY22 when compared to
FY21, and were 4.6% stronger in 2H22
compared to 1H22. FY22 underground
EBIT(A) margins softened compared to
FY21 primarily due to labour constraints
and supply pressures across several
Australian underground projects. In
2H22, Perenti secured contract rates
increases, supporting an improved
earnings and margin outlook. In addition,
Perenti is planning to exit from Dugald
River at the end of our current contract.
African underground EBIT(A) improved
by 6.8% and North American earnings
more than doubled as Red Chris and
Hemlo continue to deliver solid results.
In addition, during FY22, the Company
completed our transition out of the
Sukari Project in Egypt and after the
end of the period, announced its intent
to exit Mali.
12
FINANCIAL REVIEW
ABN 95 009 211 474 GROUP PERFORMANCE OVERVIEW
FY22 RECONCILIATION OF STATUTORY TO UNDERLYING RESULTS
$MILLION
Underlying results
Margin (%)
Add non-recurring items below:
Transaction, restructuring and other one-off costs
Non-cash impairment of Customer Related Intangibles
Provisions relating to the exit of Mali
Net foreign exchange loss
Gain on disposal of business
Net tax effect
Non-controlling interest and other
Statutory results after amortisation add back
Non-cash amortisation of intangibles
Statutory results
REVENUE
EBITDA
EBIT(A)
NPAT(A)
2,437.7
-
-
-
-
-
-
-
-
2,437.7
-
2,437.7
426.4
17.5
(9.9)
(23.2)
(11.6)
(2.0)
25.6
-
-
405.4
-
405.4
176.3
7.2
(9.9)
(23.2)
(11.6)
(2.0)
25.6
-
-
155.3
(29.0)
126.2
81.7
3.4
(9.9)
(23.2)
(11.6)
(2.0)
25.6
10.2
0.7
71.5
(29.0)
42.5
The surface mining business contributed
22.7% of the Group’s total revenue
and 13.2% underlying EBIT(A) before
corporate overheads. During FY22,
Perenti progressed with the ramp-up
of the Iduapriem Project in Ghana,
commenced its largest ever surface
mining contract at the Motheo Project
in Botswana and secured improved
rates at the Mako Project in Senegal.
As a result, revenue, earnings and
margins significantly improved, with
2H22 delivering improved performance
compared to 1H22.
The earnings profile of Motheo will
underpin the sustainable growth of
AMS and will be a significant contributor
to the expected stronger earnings
performance in FY23 and beyond.
Underpinned by a strong commodity
price environment, surface mining in
Australia delivered stronger revenues
and earnings when compared to FY21.
MINING SERVICES AND IDOBA
Mining Services and idoba contributed
a total of 6.0% of Group revenue and
EBIT(A) before corporate overheads in
FY22. Revenue increased by 8.4% when
compared to FY21, mainly supported
by higher demand for BTP services
related to the strengthening commodity
pricing environment, partially offset by
the impact of wet weather on the east
coast of Australia. During FY22, the
Mining Services Division divested the
MinAnalytical and Well Control Solutions
businesses from its portfolio.
In FY22, the Mining Services Division
captured the results of idoba, which
delivered revenue of $16.2 million
and a small EBIT(A) loss. This was in-
line with expectations and reflects a
strategic decision to invest in appropriate
resources and corporate governance
structures to enable the future delivery
of the broader idoba vision. During FY22,
in support of our strategy to establish
digital, innovation and technology driven
products and services, Perenti expanded
the capabilities of idoba, acquiring
Atomorphis and Orelogy, and executed
a Memorandum of Understanding with
Sumitomo Corporation for the co-
creation and joint development of digital
mining products for the advancement of
sustainable mining practices.
INVESTOR QUESTION
Q: In FY22, there was significant
volatility in the share price, what
were the main drivers of this?
Share price performance is impacted by
many factors. Some of these, such as
market sentiment and macroeconomic
headwinds, are beyond our control.
In FY22, we successfully navigated a
number of challenging headwinds
while also continuing to focus on
the performance of the business
to ensure that our foundations are
supportive of the creation of long-
term, sustainable shareholder value.
During FY22, we achieved a number of
strategic objectives which continued
to strengthen our business, delivering a
forecast improved 2H22 performance
which underpins the sustainability of
our earnings base and supports further
improvements in FY23 and beyond.
OUR PERFORMANCE
UNDERGROUND
Revenue
$1,737M
(Up 18% on YoY)
EBIT (A)
$185M
(Down 8% YoY)
SURFACE
Revenue
$554M
(Up 35% YoY)
EBIT (A)
$30M
(Up 1069% YoY)
MINING SERVICES & IDOBA
Revenue
$147M
(Up 8% YoY)
EBIT (A)
$13M
(Up 33% YoY)
13
PERENTI – ANNUAL REPORT 2022 GROUP PERFORMANCE OVERVIEW
CASH FLOWS
BAL ANCE SHEET AND CAPITAL MANAGEMENT
Net operating cash flows increased during FY22 by 15.2%
to $341.3 million when compared to the prior financial
year. This reflected growth in the underlying business
and a healthy cash flow conversion of 108%, the second
consecutive year the company has achieved a conversion
rate higher than 100%.
Total capital invested during the year was $467.9 million
comprising stay in business capital of $199.1 million and
an investment in growth capital of $268.8 million. This
significant investment in growth capital represents an
increase of $138.7 million when compared to FY21 as the
company continued to invest in its large scale long-term
growth projects. Returns from these investments are
expected to crystallise over FY23 and beyond, with the
overall growth of Perenti’s Contract Mining Division to be
moderate in the coming years as the business focuses on
bolstering cash flow generation and margin improvement.
Perenti’s capital investment in the period was materially
offset by the proceeds of portfolio management activities,
including:
•
•
•
•
the sale of MinAnalytical and Well Control Solutions
and the acquisition of Atomorphis and Orelogy for net
proceeds of $41.0 million;
the sale of listed and unlisted corporate equity
investments, including Chrysos, Hiseis and historical
drill for equity holdings for $56.6 million;
the sale of non-core property for $31.1 million; and
the sale of plant and equipment for $26.7 million.
During FY22, Perenti paid $68.1 million of cash tax paid
up from $56.4 million in FY21 due largely to an increase in
withholding tax paid on the continued repatriation of funds
from our foreign operations.
During FY22, the Group released its Capital Management
Policy targeting, amongst other things, a net leverage target
of less than 1.0x by 2025. Simplifying our business to focus
on our core competencies is also a strategic objective for
Perenti. During FY22, Perenti executed a number of portfolio
management activities, including both the divestment and
acquisition of assets and businesses. On 7 May 2022, Perenti
announced it had generated $134.7 million (excluding
transaction costs) through the divestment of several non-core
assets including MinAnalytical, Well Control Solutions and
our investment in Chrysos. In-line with the principles of the
Capital Management Policy, that cash was allocated across
the business with a focus of sustainably reducing net leverage
towards the target of less than 1.0x by 2025.
At 30 June 2022, Perenti delivered net leverage of 1.3x, which
was notably below market expectations and consistent with
the leverage position from FY21 despite a significant increase in
capital expenditure during FY22. FY22 net leverage was buoyed
by a strong cash conversion rate of 108% and the receipt of
cash generated from divestments. Net debt at 30 June 2022
for the Group was $553.3 million compared to $503.3 million
at 30 June 2021. The primary driver of this increase was the
impact on the high yield bonds as a result of the strengthening
US dollar (relative to the Australian dollar) and a greater
drawdown of revolving credit facilities, which was more than
offset by higher underlying EBITDA, resulting in a net leverage
consistent with the prior period. The gearing ratio (net debt
divided by shareholders equity) for the Group increased slightly
from FY21 to 29.5%.
In accordance with the Capital Management Policy,
shareholder dividends are unlikely to be declared until the
net leverage target is delivered. Accordingly, the directors did
not determine a dividend payable at 31 December 2021 or
30 June 2022.
14
FINANCIAL REVIEW
ABN 95 009 211 474 GROUP PERFORMANCE OVERVIEW
PERENTI CAPITAL MANAGEMENT FR AMEWORK
STRONG CASH FLOWS FROM OPERATIONS
INTEREST & TAX
Streamline capital
structure to
optimise interest
and tax
STAY IN BUSINESS
CAPITAL1
PORTFOLIO
MANAGEMENT
Generally in-line
with depreciation
Optimise the
portfolio and
business structure
FREE CASH FLOW
DEBT
MANAGEMENT
DIVIDENDS
SHARE
BUYBACKS
GROWTH
MAXIMISE SHAREHOLDER VALUE
1. Stay in business capital relates to capital expenditure required to sustain operations, reduce risk and meet
compliance obligations.
PERENTI PROGRESS ON LEVER AGE TARGET
1.3x
1.3x
1.3x
FY23 guidance
~1.2x
Leverage
Target <1.0x
FY20
FY21
FY22
FY23e
FY25e
In alignment with the Capital
Management Policy principles,
and noting the cash generated
from divestment activities, as well as
Perenti’s share price and the ongoing
objective to maximise shareholder
value, on 7 June 2022 Perenti
announced the establishment of
an on-market buyback program
for up to 10% of shares on issue.
On 23 June 2022, in accordance with
the relevant regulatory requirements
and prescribed timeframes, Perenti
commenced the buyback. At 30
June 2022, Perenti had completed
the purchase of 3,250,759 shares
for a total cost of $2.0 million at an
average price of $0.64 per share.
The share buyback program will
continue to be reviewed during FY23.
On 23 June 2022, Perenti announced
it had secured a new line of credit
worth $420 million through a
syndicated debt facility, effectively
refinancing and slightly increasing its
existing $400 million revolving credit
facilities, which were due to mature
on 1 July 2023. The new debt facility
is a revolving and floating line of credit
comprised of a spread of maturity
dates over two to five years designed
to manage potential refinancing risk.
At 30 June 2022, the Group had
liquidity of $544.6 million, comprising
$348.5 million in cash (30 June 2021:
$264.7 million) and $196.1 million in
undrawn revolving credit facilities.
Perenti continues to hold a strong
tangible asset backing and at
30 June 2022 its total net tangible
asset position, including cash and
working capital was $1.5 billion, up
12% on FY21 given the increased fleet
of tangible assets such as a large
mobile fleet of dozers, drills, loaders,
trucks, excavators and other ancillary
equipment across its portfolio.
INVESTOR QUESTION
Q: When can we expect to
receive a dividend again?
As presented within our Capital
Allocation framework, the
business is prioritising achieving a
leverage ratio of less than 1.0x by
2025. As a result of this, dividends
will be suspended until this target
is delivered. Due to the success
of our portfolio rationalisation
activities, Perenti commenced
a share buyback, which in lieu
of dividends, is a mechanism to
create shareholder value.
15
PERENTI – ANNUAL REPORT 2022 GROUP PERFORMANCE OVERVIEW
OUR PEOPLE
WE ATTRACT,
RETAIN &
ENGAGE
GREAT PEOPLE
WORKFORCE
ENABLING OUR PEOPLE
Work continued in FY22 to improve
Perenti’s people related systems and
visibility of key data and information to
better connect our global business, with
significant progress made to improve
our approach to recruitment and
onboarding. Perenti has embedded HR
and HSE systems that provide leaders
and employees with access to important
information and analysis. The embedding
of these systems has been critical to
underpinning our growth as we work to
future proof our organisation.
Our people data has provided
greater insights into matters such
as pay and gender equity, as well as
understanding turnover. This data
has informed decision making as
we proactively work on company-
wide improvement opportunities to
engage and retain our employees.
BUILDING OUR LEADERS FOR
TOMORROW
Engagement with our senior leaders
across the Group is vitally important
to ensure we deliver our business
objectives. A Senior Leader Forum is
held annually bringing together leaders
from across the Group’s international
operations to discuss and align on
strategic plans, business direction,
leadership development and culture.
A pilot of a new, bespoke leadership
development program, Leading@Perenti,
which aims to enhance the capability
and capacity of senior leaders across
the business, was completed with the
Group Executive in FY22, with full roll out
planned to commence in Q2 FY23.
In addition, front line leader programs
have continued in FY22 and we focused
on the developmental needs of our
line leaders in areas such as effective
people management, managing work
priorities and creating high performance
teams in a workplace safe from harmful
behaviours.
8,939
Workforce numbers remain
strong with more than 3,400
employees in Australia and
5,500 internationally.
LOCAL EMPLOYMENT
INTERNATIONALLY
89%
Local employment in our
international operations has
increased to 89% (from 87%) with
an additional 2.4% of employees
from within the region.
FEMALE PARTICIPATION
10.6%
Female participation rates
increased in FY22 to 10.6%
We have two female Non-
executive directors on our Board
and women occupy 19% of our
senior management positions.
APPRENTICES AND TRAINEES
435
We have a strong commitment
to training our workforce of
tomorrow with 282 trainees, of
which 20% are female, and 153
apprentices.
16
PEOPLE
These included leadership programs
delivered through an experienced
external vendor for our Contract Mining
and Mining Services divisions.
Inclusion and diversity is also being
included as a theme throughout all our
leadership programs, with cultural and
behavioural principles embedded as well.
INVESTING IN OUR PEOPLE
Our focus on developing our people
has continued throughout the year.
Our Apprenticeship Program saw
increased uptake with 153 apprentices
across the Group. A number of
apprentices have been able to
successfully work across divisions,
taking up opportunities to expand their
skills and exposing them to the diverse
work and operations across the Perenti
group of companies. In addition to
our commitment to apprentices, we
also supported 282 traineeships during
the year, of which 20% were female.
Our Graduate Program increased to
47 graduates in FY22, with the
continuation of our structured
program designed to assist graduates
in achieving specific objectives
across their operational rotations.
Our graduates came together for
our annual graduate forum which
supports these future leaders to develop
leadership skills, as well as a focus on
safety, technology and innovation and
alignment with the Perenti principles.
WORKING TO ENSURE
OPER ATIONAL CONTINUIT Y
The labour market has continued
to tighten across Australia and for
international roles, exacerbated by
COVID-19 and the resulting country and
state-based travel restrictions. Within
Australia, border restrictions impacted
the ability for FIFO employees to move
freely across state boundaries. Perenti
has continued to support our people
with a dedicated team focused on travel
and mobility management to ensure
operational continuity for our clients.
ABN 95 009 211 474 GROUP PERFORMANCE OVERVIEW
HEALTH AND
SAFETY
BUILDING AND
MATURING
OUR SAFETY
CULTURE
TRIFR
6.9
Total Recordable Injury Frequency Rate
increased from 5.1 to 6.9 in FY22.
SPIFR
2.8
Serious Potential Incident Frequency
Rate reduced from 2.9 to 2.8 in FY22.
CRITICAL FIELD VERIFICATION
CHECKLISTS CONDUCTED
27,450
HEALTH AND SAFET Y
We continue to work tirelessly toward
our goal of No Physical or Psychological
Life Changing Events, however tragically
during the year we experienced the
loss of three of our employees in
workplace incidents. One colleague
died in an incident underground at the
Hemlo mine in Canada in July 2021,
and two colleagues died in an incident
underground at the Zone 5 mine in
Botswana in May 2022. The loss of
any person through the work we do
is completely unacceptable, and the
leadership of Perenti and the entire
organisation are steadfast in ensuring
the lessons we learn from these events
are implemented, and furthermore
we take a step back to ensure our
current focus areas adequately support
our safety goals and expectations.
It is for this reason that one of our
commitments for FY23 is to undertake
an independent review of the safety
culture, capability and processes across
our Contract Mining Division.
SAFET Y LEADERSHIP AND CULTURE
Our safety leadership programs are
vital as we work towards developing
our leaders, maturing our culture
and achieving our objective of No
Physical or Psychological Life Changing
Events. FY22 saw further progress of
these initiatives to improve our safety
performance.
A primary phase of our safety leadership
journey, the Thinking Differently About
Safety Program, was delivered across
the business to senior leaders in FY22.
This program aims to challenge leaders’
thinking around certain aspects of
safety, including what we believe
safety is, courageous leadership, risk
management and culture. Furthermore,
we implemented our Know, Say,
Do Program, which is aimed at
frontline leaders and involves a series
of workshops to develop people’s
understanding and capability to identify
key items they should know and say
about safety, and what to do to lead and
manage safety in their day-to-day roles.
CRITICAL RISK MANAGEMENT
Perenti’s focus on our Critical Risk
Management (CRM) Program further
progressed throughout the year, as we
continued to engage our employees in
the identification, elimination, control
and mitigation of fatal risks.
In FY22, we conducted an audit
involving independent auditors to assess
the design and implementation of
Perenti's Critical Risk Standards across
the business, resulting in a number of
positive opportunities to share good
practice and address gaps to improve
our management of critical risks.
Our focus remains on embedding field
verifications of critical risk controls,
a process of verification undertaken
by frontline leaders through to senior
managers. These are aimed at ensuring
the life-saving controls required are
in place and effective for their team
on the job. We also developed and
implemented Critical Control Operator
Verifications (branded as CheckMate)
which are aimed at enabling frontline
workers to ensure their critical controls
are in place and working effectively for
the tasks being undertaken.
EFFECTIVE SYSTEMS
A number of audits were held in FY22,
including a surveillance audit for AS/NZS
4801 at BTP, and certification audits for
ISO 45001 at Barminco and Ausdrill. The
audits all resulted in either recertification
of existing standards or successful
conversion to the newer ISO 45001
standard. In addition, an independent
audit program was established for
Australian and international mining
projects, developed to provide assurance
of our controls for the prevention of
fall of ground and slope stability.
In early FY22, a new HSE information
system for the collection, analysis
and reporting of HSE related data was
implemented across the Group. Branded
internally as HSE Central, the system
provides a common platform and single
source of truth for the management of
HSE data across the organisation.
The introduction of this system has
already achieved some of the initial
improvement objectives. These include:
•
•
the centralised collation of
greenhouse gas emission data
that provides us with a baseline
understanding of current greenhouse
gas emissions; and
improved analysis of incidents and
injuries that ensures we have a better
understanding of our performance
enabling superior decision making
to manage risks and look after our
people, environment, communities
and assets.
HEALTH & SAFETY
17
PERENTI – ANNUAL REPORT 2022 OPER ATING OVERVIEW
CONTRACT MINING
AUSTRALIA
Perenti’s 2025 Strategy update in June 2022, resulted in a change to
our business model to support a group-wide focus on shareholder
value through a blended portfolio of complementary divisions that
include Contract Mining, Mining Services and idoba.
As part of the implementation of
the updated strategy the Contract
Mining Division will be re-organised
into three regions – Australia, Africa
and North America. This regional
model will improve the level of
support the business provides to our
projects whilst reducing duplication
and, as a consequence, improve
efficiency.
EMPLOYEES
STATES
PROJECTS
3,400+
4
43
SN
ML
BF
GH
TZ
WA
Perth
Head Office
SA
QLD
NSW
BW
LOCATION
SURFACE PROJECT
Western
Australia
(WA)
Eliwana, Gruyere, Mungari,
Superpit/Fimiston, Huntly,
Pilgangoora, Mount Gibson,
Cloud Break, Mount Keith,
South Flank, St Ives
Woodie Woodie, BHP (WAIO),
Granny Smith (GSM), St Ives
(SIGM), NickelWest, Cue Project
Lake, Illaara Gold Project,
Mt Magnet Gold Mine
Ramelius), Mount Monger,
Mt Magnet (Dacian Gold)
Queensland
(QLD)
Blair Athol, Middlemount Coal,
Millennium, Commodore
BMA
Boggabri
New South Wales
(NSW)
South Australia
(SA)
LOCATION
UNDERGROUND PROJECT
Western Australia
(WA)
New Holland, Agnew,
Wallaby, Plutonic,
Odysseus, Flying Fox,
Spotted Quoll, Sunrise Dam,
Nova, Rosemont, Garden
Well, Savannah
Queensland (QLD)
Dugald River, Mt Colin
Whyalla RC Drilling
New South Wales
(NSW)
Cowal
INVESTOR QUESTION
Q: What are your growth objectives
for the Contract Mining Division?
As outlined in our 2025 Strategy update we
have strengthened our capital prioritisation
and allocation framework. We recognise
that our Contract Mining Division, when in a
growth phase, requires capital investment.
This means we expect to moderate our
growth in the Contract Mining Division but
enhance the quality of earnings, focusing
on quality projects in the tier one mining
jurisdictions of North America, Botswana and
Australia, as demonstrated by the recently
announced Cowal Underground Project in
New South Wales.
18
CONTRACT MINING – AUSTRALIAN OPERATIONS
ABN 95 009 211 474
BC
ON
DENVER
vV
AUSTRALIAN
OPERATIONS
Throughout FY22, our Australian
underground and surface operations
continued to deliver solid outcomes
and performance despite the ongoing
global challenges associated with the
COVID-19 pandemic.
With a workforce of approximately
3,000 employees in Australia, Barminco
and Ausdrill have operated for more than
30 years and have a presence in four
states with more than 40 projects.
Specialising in hard-rock underground
mining, Barminco further enhanced its
reputation as a contract mining company
of choice by securing a four-year, $520M
full-service mining contract at Cowal
in New South Wales. In addition to the
mining contract, Barminco was also
awarded a four year term for diamond
drilling services, valued at $60M. This
is a significant Australian underground
project for a high-quality client and when
in full production, it will become one of
Barminco’s largest projects in Australia.
It also represents the Group’s first
material contract in New South Wales.
More recently, Barminco extended its
presence at IGO’s Nova mine in Western
Australia for a further two years. Our
strong and ongoing relationship with
IGO signifies continual confidence in our
performance and further builds on our
seven years at the site.
In line with our updated strategy, there
has also been a focus on optimising
our operational performance and in
recent times we have been successful
in securing rate increases at a number
of projects. This is a testament to the
quality of the service we provide and the
strength of the relationship we have with
our clients.
Year on year, Barminco delivered
increased development and production
output for our clients and FY23 is
forecast to deliver even further growth,
with plans to deliver approximately
73 kilometres of development and
8 million tonnes of production.
In the near term, Barminco will conclude
its work at Wallaby and by Q3 FY23 will
conclude work at Dugald River, having
enabled our client MMG to transition to
owner operator production works. These
contract conclusions will enable capital
to be redeployed to new projects and the
earnings contribution will be more than
offset by the new contract for Cowal and
the ramp up of production activities at
the Savannah, Garden Well and Odysseus
projects.
OPER ATING OVERVIEW
cost escalation and this has been
exacerbated, particularly in Western
Australia, by the availability of labour
which has also been a significant
challenge. The results achieved reflect
the strength of the business and we
are excited about the future. Labour
constraints and cost escalation will
ultimately improve and our Australian
Contract Mining service offerings are well
positioned to reap the financial upside
that will follow.
In FY23, the safety of our workforce will
be a continued focus for the business
with the introduction and consolidation
of new and existing tools and campaigns,
further embedding our principles and
critical risk management tools in order to
deliver ongoing improvement in safety
outcomes across all operations.
In surface mining, FY22 saw Ausdrill
continue to perform strongly and enter
FY23 with an impressive demand for its
exploration, drill and blast and grade
control services.
New contracts have been secured in
Queensland and Western Australia for
FY23, as well as extending a significant
number of current works, leveraging
long-term client relationships. This
results in Ausdrill having one of its
strongest secured order books in recent
history.
These results cannot be underestimated
and have been achieved against a
backdrop of COVID-19 interruptions,
border closures, elevated vacancies,
challenging mine conditions and
unfavourable weather events. These
events have resulted in well documented
CASE STUDY
CASE STUDY
Barminco will continue operations
at the Cowal Gold Mine in regional
New South Wales, after successfully
winning a contract for services with
project owner, Evolution Mining.
Our underground operations
have been awarded a four-year,
$520 million contract, one of
Barminco’s largest underground
mining projects in recent history.
The work will see us expand our
initial scope of works to include
development of a second portal,
all underground development and
production works and underground
mining services required to
support the continued mill feed of
underground ore.
This is a fantastic opportunity for
Barminco to build on our strong
working relationship with Evolution
Mining, one of Australia’s premier gold
mining companies, while also creating
enduring value for the local, regional
and Indigenous communities of the
Cowal region.
It is our first project in New South
Wales and one that will provide us a
foothold in the state. We appreciate
the opportunity provided to Barminco
by Evolution Mining and look forward
to further developing our relationship
with them and delivering safe and
efficient operations at the mine.
This is Barminco's first entry into
New South Wales in more than
30 years of operation. The project
will grow to become one of our
largest in Australia.
The contract extension commenced
in July 2022.
19
V PERENTI – ANNUAL REPORT 2022 OPER ATING OVERVIEW
CONTRACT MINING
AFRICA
Comprising underground and surface operations as well as
exploration drilling, our African operations generate a significant
portion of the Company’s annual revenue.
Perenti’s Contract Mining Division
in Africa incorporates Barminco,
African Mining Services (AMS)
and African Underground Mining
Services (AUMS). It operates 17
projects across six countries and
employs more than 5,000 people.
EMPLOYEES
LOCAL EMPLOYEES
PROJECTS
LOCATIONS
5,000+
89%
17
6
SN
ML
BF
GH
LOCATION
SURFACE PROJECT
UNDERGROUND PROJECT
Botswana (BW)
Motheo
Zone 5
Burkina Faso (BF)
Sanbrado
Ghana (GH)
Akyem, Ahafo,
Damang, Iduapriem,
Jappa, Nsuta
Siou, Yaramoko
Obuasi, Subika
Mali (ML)
Senegal (SN)
Fekola
Mako
-
-
Tanzania (TZ)
-
Geita Hill, Nyankanga
BW
TZ
ON
WA
Perth
Head Office
SA
BC
QLD
NSW
DENVER
20 CONTRACT MINING – AFRICAN OPERATIONS
ABN 95 009 211 474
TBA
v
OPER ATING OVERVIEW
AFRICAN
OPERATIONS
A focus in recent years has been our
strategic expansion into the tier one
mining jurisdiction of Botswana. The
start of open pit mining at the Motheo
Project in April 2022 builds on our
presence at the Zone 5 underground
project near Maun. These two
significant contracts have positioned
the division as, arguably, the largest
contract miner in Botswana, and as such
provide a great base to build this part of
our business in future years.
The COVID-19 pandemic continued to
be extremely challenging during FY22.
We navigated our way through expatriate
travel issues and personnel shortages
as our work force was impacted by
the virus. Delayed access to parts
and equipment due to global supply
chain issues also contributed to these
significant challenges.
Despite these challenges, due in large
part to the unrelenting efforts of our
workforce, productivity and development
results were strong for FY22.
The ongoing expansion at Zone 5,
the start of work at Motheo, the
establishment of joint ventures with
a number of local businesses to build
in-country capability and meet local
content requirements, as well as the
transition to a new bulk underground
mining method at Subika, are just
some of the impressive developments
that continue to take place across
the division. In line with our focus on
optimising business performance, we
were also successful in securing a rates
increase at one of our surface projects,
which is a testament to the strength of
our client relationship and the quality of
our service offering.
An incident at our Zone 5 operation
in Botswana in May 2022, led to the
tragic loss of life of two colleagues.
Both were experienced employees and
investigations into what led to their
deaths are ongoing. We continue to work
with local authorities and will consider
any relevant recommendations that
come from the investigation to ensure
any risk is mitigated into the future.
Our thoughts and prayers are with the
families and friends of Baleseng Sechele
and Moses Marpaung.
FY22 also saw a consolidation of
business as we exited Egypt following the
conclusion of our contract at the Sukari
Mine, where we successfully operated
for more than a decade, including being
the first mechanised underground mine
in Egypt. Importantly, the commitment
to our people was recognised as we
transferred some of our 400-strong
Sukari workforce to other areas of the
business. We successfully sold our
equipment and inventory for profit,
which reflects our business model and
generated positive cash flows on the
project exit.
Investing in our communities
continues to be a focus with 89% of our
international workforce from areas local
to our operations and a further 2% from
within the region.
As a global operator, many more exciting
plans are touted for FY23 as we look to
continue to leverage our relationships
and secure further work in this mining-
rich continent.
CASE STUDY
After successfully being appointed
to the Zone 5 contract in 2019,
Perenti's underground mining
business, Barminco, set about
ensuring the operation would be
one of the most technologically
advanced mines in its portfolio.
With the support of mine owner,
KCM (Khoemacau Copper Mine),
Barminco planned and executed
a design that would make Zone 5
an industry leader in underground
communication network capability.
Traditionally, a significant challenge
facing underground mining is an
inability to understand or identify
issues that may be affecting
production from the surface. Lost
time or problems generally can’t
be addressed until teams complete
shifts and debriefs are held.
Acknowledging this, Barminco
invested heavily in technology to
overcome these problems and
improve network connectivity. The
use of Wi-Fi underground is quite
common in the sector, however the
difference at Zone 5 is the improved
coverage utilising Wi-Fi over co-
axial cable, which makes the near
complete coverage of the mine more
cost effective and less labour intensive
in commissioning and maintenance.
With the foresight to build Zone 5 as
a technology-centric mine, two and
a half years on, the investment is now
paying dividends.
Confidence in Wi-Fi connectivity
allows for remote loading from the
surface, provides real time data
feedback on machine performance
and diagnostics and the ability to
instantly log maintenance requests.
It also allows live feedback to site
leaders by providing images of
underground operations back to
the surface.
We are able to utilise traditionally
lost time in between shifts and
during blast times to continue
loading activities, thereby increasing
productivity. Additionally, loaders are
operated under automation allowing
for greater speed, reduced damage
and allowing operators to control
multiple machines at a time.
Looking forward, emergency
management in the underground
environment will also be dramatically
improved. Plans are underway to
allow the use of tablets to provide
the ability for instant access to safety
manuals and procedures.
PERENTI – ANNUAL REPORT 2022 21
OPER ATING OVERVIEW
CONTRACT MINING
NORTH AMERICA
Perenti’s strategy to expand into North America continued into
FY22 as we delivered high quality and reliable underground
mining services for our clients, despite facing some unique
mining challenges associated with operating in sub-zero
temperatures during the northern hemisphere winter.
SN
ML
BF
GH
TZ
BW
EMPLOYEES
PROJECTS
~400
2
WA
QLD
LOCATION
UNDERGROUND PROJECT
BC
SA
Ontario (ON)
Hemlo
British
Columbia (BC)
Red Chris
Perth
Head Office
* Denver
NSW
North America office
ON
DENVER
*
22
CONTRACT MINING – NORTH AMERICAN OPERATIONS
ABN 95 009 211 474
OPER ATING OVERVIEW
NORTH AMERICAN
OPERATIONS
Employing approximately 400
people in North America, Barminco
is leading the development for
Newcrest Mining at Red Chris in
Northern British Columbia and
Barrick Gold’s Hemlo Project in
Ontario.
The extreme weather conditions,
which see temperatures ranging
from 30 degrees Celsius in the
summer to minus 30 degrees in
winter, require extra measures to
ensure production remains safely
on track. Both sites have their own
individual logistical considerations
given their remote locations. The Red
Chris Project is located appropriately
1,700 kilometres north of Vancouver
in British Columbia while the Hemlo
Project is located 350 kilometres
east of Thunder Bay in Ontario.
The team at Red Chris continues to
develop the decline, and positively, is
awaiting further approvals to expand
our scope at the mine. The future
remains bright despite some early
ground condition challenges that
have since been rectified.
At Hemlo, partial flooding of the
mine due to snow melt during
late spring and early summer did
impact operations but production
returned to normal as the weather
improved and targets continued to
be revised. Combined with a number
of infrastructure improvements the
team is forecasting a greater growth
period across FY23.
Perenti would also like to pay our
respects to the memory of a valued
employee who received fatal injuries
during an accident at Hemlo in July
2021. Our deepest sympathies extend
to the family and friends of our
respected colleague, Troy Cameron.
CASE STUDY
At Perenti, we embed our principles
in everything we do. This extends
beyond our ‘job’ and looks for ways to
positively influence the communities
in which we operate.
The Red Chris Project in Northern
British Columbia operates on the
traditional lands of the Tahltan Nation.
As part of operating in the region,
Barminco is focused on providing
opportunities to Tahltan people
across all aspects of our project.
Working closely with our client,
Newcrest Mining, Barminco’s
commitment to the traditional
custodians has seen us enter a
formal agreement with the Tahltan
Nation Development Corporation
(TNDC), which represents the local
Bands of Iskut and Tahltan people.
This agreement further reflects our
principles of Enable tomorrow and
Walk in their shoes as we look to
employ and upskill local people in a
safe and professional environment.
In addition to employing local people,
the TNDC also provides a range of
logistics, capital and resource support
services to operations on site.
An investment in new equipment by
the corporation provides consistent
income for the TNDC, as Barminco’s
agreement as a business partner sees
us hire the equipment directly from
them, creating consistent positive
cash-flow for their organisation.
FY23 will also see the first Tahltan
mining engineer employed by
Barminco at Red Chris, ensuring
a positive role model within the
community and further enhancing
our reputation as a diverse and
inclusive company.
Going forward, we are looking
to introduce apprenticeship and
cadetship opportunities that will
include a mining engineer course
and practical experience on site.
We will continue to conduct and
participate in local recruitment and
information sessions to attract more
Tahltan Nation people and take up
employment opportunities.
In a further sign of our commitment
to the Tahltan community and to
better educate the workforce at site,
Barminco employees will undergo
cultural awareness training at Red
Chris.
23
PERENTI – ANNUAL REPORT 2022 OPER ATING OVERVIEW
MINING SERVICES
The past year was one
of transformation and
improved performance
for the Perenti Mining
Services Division, which
was formerly known
as Investments. The
change in name reflects
growth opportunities
that are future focused
and lower capital
intensity, as part of the
Perenti strategy update
that was presented in
June 2022.
Key achievements by the division
through the year included the
successful divestments of onshore
oil and gas equipment supplier,
Well Control Solutions, assaying
services company, MinAnalytical,
and our shareholding in Photon
Assay technology company, Chrysos.
Collectively these divestments
liberated $92.5 million in cash that
was re-deployed in line with the
Perenti Capital Management Policy.
Against this backdrop of significant
change within the division the
remaining business, which comprise
BTP and our logistics businesses
Supply Direct and Logistics Direct,
delivered strong performances in
what continued to be challenging
conditions.
INVESTOR QUESTION
Q: Your Mining Services Division
has been reduced in size through
divestments, what is the future of
this division?
Our Mining Services Division is an
emerging growth opportunity which
is future focused with lower capital
intensity. We will look to build a
portfolio of industry leading businesses
who work with clients across the
mining sector to deliver value add
services to meet existing and emerging
needs.
24 MINING SERVICES
BTP
BTP continued its improvement as
commodity markets rebounded and a
shift of focus into new markets gathered
pace. The business met its earnings
forecast for FY22, despite ongoing
headwinds in the form of wet weather
conditions on the east coast and skills
shortages, that caused some delays
resulting in under utilisation of rental
fleets. Like the rest of the resources
industry, BTP continued to manage the
impacts of labour shortages and people
being absent due to COVID-19.
The new equipment rebuild workshop
at BTP Hazelmere is now complete.
This modernised workshop facility has a
ten-bay capacity, increasing the number
and size of rebuild projects that BTP can
comfortably undertake (see case study
on page 25 for more information).
SUPPLY
DIRECT
Supply Direct delivered a strong result,
exceeding both revenue and earnings
targets through strong operational
performance, and organic growth.
The team continued to innovate by
delivering new product offerings, which
expanded Supply Direct’s client base and
provided added flexibility and resilience.
As a global business with a small
workforce based in Johannesburg,
COVID-19 has caused significant
disruption and the impact of COVID-19
on global supply chains has also been a
challenge the team has had to contend
with throughout the year.
We believe our ability to successfully
navigate complex and disrupted supply
chains to deliver certainty for our clients
was a key competitive advantage and
contributed to our result in FY22.
Maintaining and growing our talented
team and focusing on new business will
be the key focus areas for FY23.
ABN 95 009 211 474 CASE STUDY
OPER ATING OVERVIEW
LOGISTICS
DIRECT
With global supply chains under
pressure like never before, Logistics
Direct rose to the challenge of helping
to keep our clients’ operations running
as efficiently as possible. While our
business is grounded in mining, where
we continue to grow market share,
this year we also started to extend our
range into non-mining businesses
that require reliable, efficient logistics
services.
Our focus on client retention by
delivering great service was rewarded
with a 100% retention rate. We work
closely with our Contract Mining
Division colleagues to not only
support their activities, but to ensure
their clients can navigate a complex
logistics environment to maximise
the operational efficiency of their
businesses.
Africa is a key market for us, and our
expertise, built up over decades of
operational experience, allowed us to
navigate challenges including regional
political instability and COVID-19
induced border closures.
Our ongoing focus on working safely
will continue into FY23, while we
continue delivering for our existing
clients and expand our reach into
non-mining logistics opportunities.
BTP is building our capability to
provide complete equipment rebuild
solutions for our clients by investing
in modern equipment facilities in
Western Australia and Queensland.
BTP’s expansion is underpinned
by our new Hazelmere equipment
maintenance facility, which includes
10 rebuild bays totaling 2400m2, and
15 tonne crane capacity, making it
one of the largest mining equipment
rebuild workshops in Perth. Alongside
the Perth expansion, BTP’s Mackay
facility has seen the introduction of
three rebuild bays and component
rebuild capability which have recently
been utilised to undertake the
overhaul of a CAT 785C truck.
For BTP’s clients, these modern
facilities mean quicker turnarounds
as they provide a one stop shop for
fleet repairs, eliminating the need
to manage multiple suppliers and
ultimately reducing the total cost of
ownership for clients.
In FY22, BTP completed our CAT
785C truck rebuild program which
saw 11 machines dismantled,
assessed, and then re-assembled by
BTP technicians at our Hazelmere
facility. Eight of these trucks have now
been sold or hired out to clients, with
further sales in the pipeline for the
remaining trucks.
PERENTI – ANNUAL REPORT 2022
25
OPER ATING OVERVIEW
IDOBA
PERENTI’S
TECHNOLOGY
DRIVEN FUTURE
Technology is critical to the mining industry and for
Perenti it is a key enabler to deliver a sustainable future.
Our journey towards a technology driven future started
in 2019, when we first outlined our 2025 Strategy. The
building blocks of that strategy began to take shape in
July 2020 with the initial acquisition of the two idoba
foundation businesses, Sandpit Innovation and ImpRes,
and then later Optika Solutions. Since the official launch of
idoba last July, Orelogy and Atomorphis have been added
to the stable of strategically aligned technology businesses
that make up idoba’s technology informed service offering.
Collectively, these businesses have industry leading
capabilities in data science, automation, mine and
processing optimisation, digital transformation and
sustainability. With more than 50 years collective
experience servicing the resources sector, the idoba
businesses are truly diverse with extensive lived
experience, deep domain knowledge and a passion
for creating change.
While the experience and knowledge each of the idoba
businesses offer is formidable, the team’s real and unique
ability is in using co-creation to unleash the true impact
of diverse thinking, enabling them to innovate across
the full spectrum of problem discovery, solution concept
and ideation, solution delivery, implementation and
value realisation.
INVESTOR QUESTION
Q: How has idoba evolved in FY22?
During the year we continued to invest
in idoba and the corporate structures
to underpin its growth. Furthermore, to
expand on our capabilities and services, we
acquired two additional and complimentary
businesses, Atomorphis and Orelogy and
executed a Memorandum of Understanding
with Sumitomo Corporation for the co-
creation and joint development of digital
mining products for the advancement of
sustainable mining practices. We are very
pleased with how idoba is progressing and
are confident in its future.
idoba’s approach is nimble, fast, and solutions focused.
It is a relatively small investment for Perenti, but one that we
believe will generate significant returns in the long-term. This
is because of our unique capability to develop and service the
mines of the future, brought about through the coupling of:
• Perenti’s significant mining capability, having more
than 30 years of surface and underground mining
experience in Australia, Africa and North America; and
•
the digital and technology focused capabilities in idoba.
Importantly, this presents significant future upside and at
the same time, mitigates risk to our business from new
competition.
idoba’s ecosystem approach transfers mining know-how
into transformative digital offerings. idoba’s priorities are to:
•
improve Perenti's businesses;
• develop new digital product offerings; and
• build new recurring revenue streams.
PHYSICAL WORLD
SENSING, ACTING
MONITORING
DATA
THE FUTURE
READY MINER
INSIGHTS
DIGITAL WORLD
DIGITAL
STORYTELLING
26
IDOBA
ABN 95 009 211 474
In the crowded and competitive
global market for technology
opportunities, Sumitomo have
identified the recently formed
idoba as a player it wants to work
with, reflecting the calibre of
potential that idoba brings to
Perenti and the mining industry.
IDOBA + SUMITOMO
In February 2022, idoba and
Sumitomo Corporation entered into
a Memorandum of Understanding
(MOU) for the co-creation and joint
development of digital mining products
focused on advancing sustainable
mining practices.
As a major investment and trading group
consisting of over 900 companies in 112
countries, Sumitomo brings a unique
global perspective complementing
idoba’s mining services and technology
expertise.
Under the terms of the MOU, Sumitomo
and idoba will collaborate and jointly
develop digital mining services, including
mining process optimisation and carbon
footprint management services. Over
the past six months idoba and Sumitomo
have initiated development of Mine
Performance Navigator, a mining process
optimisation service that connects and
analyses mine data to predict future
performance and provide decision
support.
IDOBA BUSINESSES AT A GL ANCE
Sandpit Innovation is a technology and
innovation services consulting firm
with more than 10 years’ experience
and a diverse range of mining clients
across top tier miners, contract miners
and engineering firms. Sandpit boasts
a strong autonomous mining, remote
operations and ESG footprint in the
market.
Orelogy is a specialist mine planning
and mining technical consultancy with
multi-commodity expertise across
resource sector project development
and management, mine planning and
cost modelling optimisation, as well as
pre-feasibility and feasibility studies.
Orelogy has a track record of delivering
significant value across a range of
global projects and commodities.
OPER ATING OVERVIEW
JOINING AROSE
At the end of 2021, idoba joined
Australian Remote Operations for Space
and Earth (AROSE), a not-for-profit,
industry-led consortium with a vision
for Australia to be the trusted leader of
remote operations on earth and in space.
The union between idoba and AROSE
presents an opportunity to combine
insights across industries, better
strengthening global mining services,
as well as harnessing idoba’s future-
thinking to grow the nation’s space
industry.
Through Perenti’s global expertise in
mining operations, idoba is able to
provide real life data and insight to the
AROSE consortium which will assist in
strengthening their mission to triple
the size of the nation’s space sector
by 2030. Utilising mining data in space
projects will in turn allow the industry
to operate more safely, sustainably, and
productively.
In return the AROSE consortium
provides idoba with expert insight into
reduced footprint processes from the
space industry, which often operates
in untouched territories. This data will
support the future development of the
mining industry on earth, as well as
Perenti’s commitment to a sustainable
future. It will also uniquely position
Perenti as a leader in the field of remote
operations excellence.
LEVER AGING THE AKUMEN
PL ATFORM
Originally obtained through the
acquisition of Optika Solutions, Akumen
is idoba’s digital data science and
decision support platform. Akumen
delivers real time data analysis and
autonomous complex scenario analysis,
providing the architecture that allows
previously stranded data models and
tools to interconnect despite disparities
in language and optimisation. In addition
to supporting clients using the Akumen
platform, the idoba team have been
working on developing the next iteration
of the platform.
The team has also pooled their skills and
talents to use Akumen as the platform
or ‘backbone’ to incorporate a number
of existing concepts, ideas and products
from within the idoba ecosystem.
This has led to the generation of
DiiMOS™ – a Distributed, Intelligent,
Integrated Mining Operating System
that harnesses knowledge, data, and
insights from across operating domains
and organisational silos, empowering
client businesses to optimise and unlock
unrealised value across their operations.
Optika Solutions is an award-winning
West Australian software, products
and solutions company specialising
in data science, artificial intelligence
and industrial mathematics. Its digital
platform, Akumen, is a cloud-based
decision support environment that
brings together the best technologies
of advanced analytics and simulation
modelling within a single platform,
allowing clients to create meaningful
insights from their data and provide a
pathway to artificial intelligence.
Atomorphis is a digital modelling
company who apply agent-based
modelling and cutting-edge data
science techniques to solve resource
sector problems which were previously
considered unsolvable. Solutions
include modelling mine fleet variability
in 3D using parameters such as
loading rates, payload, spotting and
dumping times. This provides mining
companies with the ability to model
their operations and see the true
impact of fleet interactions, increasing
productivity and reducing costs.
ImpRes is an operational improvement
services consulting firm which has
delivered billions of dollars in bottom
line improvements across mining, oil
and gas, manufacturing and health care
over an impressive 11-year history.
PERENTI – ANNUAL REPORT 2022
27
OPER ATING OVERVIEW
CASE STUDY
idoba’s passionate, talented, and
diverse team has been built on
the belief that no one individual
or organisation has the solution
to address today’s complex
problems. It takes a diverse group
of different perspectives and skills
to make sense of the issues and
to adaptively respond to them.
idoba’s Chief Technology Officer
Matthew Schneider is one of the
outstanding leaders of the idoba team
and a founding partner of acquired data
science business, Optika Solutions.
Matt explains that Optika was established
from a need for companies to utilise
the data they had, in a way that enabled
better decision making. Data is futile
unless it can tell a story to clients
that is meaningful and relevant.
With a 90% neurodiverse team, the
Optika team already has a reputation
for applying their “out of the box”
thinking to find new solutions to
often abandoned problems.
Combining Optika’s data science
thinking with idoba’s significant
operational experience and ability
to contextualise data insights is
already driving innovation in the
resources industry and gaining
traction both locally and globally.
This unique way of thinking has led
to the development and evolution
of several of idoba’s products,
including the Akumen platform,
which has picked up national awards
for innovation and data science.
Through leveraging our collective
capabilities, idoba will develop
Perenti’s digital capability ultimately
adding substantial value to our
clients and shareholders. As Matt
acknowledges, value is created
all round when we are part of an
inclusive organisation that embraces
diversity and allows everyone to bring
their authentic best self to work.
28
IDOBA
ABN 95 009 211 474
SUSTAINABILITY
REPORT
ABN 95 009 211 474
Creating enduring
value and certainty
ii
CONTENTS
INTRODUCTION
Introduction from the
Chair of the Sustainability Committee
Our approach
Material issues
United Nations Sustainable Development Goals
Summary of our performance
30
31
32
32
33
NO SHORTCUTS – ETHICS AND GOVERNANCE 34
34
Our commitments
34
Board structure
34
Risk and internal audit
35
Code of Conduct
35
Supporting a culture of speaking up
35
Anti-bribery and anti-corruption
35
Timely and consistent disclosure
35
Cyber and information security
35
Industry association memberships
36
Human rights and modern slavery
36
Security
NEVER WASTEFUL – ENVIRONMENT
Our commitments
Environmental Management System
Climate change
Emissions and decarbonisation
Taskforce on Climate related Financial Disclosures
Water
Environmental incidents
SMARTER TOGETHER – SAFET Y AND HE ALTH
Our commitments
Safety performance
Health, Safety and Environment (HSE)
information system
Critical risk management
Safety leadership
Health
Mental health and wellbeing
COVID-19
Occupational hygiene monitoring
SMARTER TOGETHER – OUR PEOPLE
Inclusion and diversity
Our commitments
Leadership and capability development
Remuneration
HR System
Labour relations and management
WALK IN THEIR SHOES – COMMUNIT Y
Our commitments
Our local communities
37
37
38
38
38
39
40
40
41
41
41
42
43
44
45
45
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46
47
47
47
47
48
48
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49
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49
30
PERENTI – SUSTAINABILITY REPORT 2022
INTRODUCTION
INTRODUCTION FROM THE CHAIR OF THE
SUSTAINABILIT Y COMMIT TEE
I am pleased to present Perenti’s FY22 Sustainability Report.
At Perenti, we are committed to progressing our sustainability
journey to meet the expectations of stakeholders and to
deliver shareholder value.
To reinforce the criticality of sustainability to the business,
we have embedded sustainability into everything we do within
our updated 2025 Strategy. During the past year we also
established the Sustainability Committee to ensure material
sustainability issues receive appropriate attention, oversight
and strategic guidance. Since the committee’s establishment
we have engaged in our planned approach on issues such as
climate change, human rights and the further development of
our sustainability strategy and standards.
Safety is a vital focus of the committee's work. Despite our
ongoing safety efforts we are deeply saddened by the tragic
loss of three of our employees and the irreplaceable loss this
has caused their families, friends and workmates.
The loss of our colleagues is felt deeply throughout Perenti
and reinforces our determination to continue strengthening
programs to improve the management of critical risks, further
develop our leadership capability and culture, as well as
provide effective systems for safe work.
Our Sustainability Report outlines our efforts to improve our
sustainability performance and address risks and opportunities
which are material to our business.
TIM LONGSTAFF
22 August 2022
SUSTAINABILITY
EMBEDDED IN
EVERYTHING WE DO
ABN 95 009 211 474 INTRODUCTION
OUR APPROACH
At Perenti, sustainability means
the ability to thrive in perpetuity,
considering all our stakeholders
and honouring our 'social licence to
operate.' This is consistent with our
organisational purpose ‘to create
enduring value and certainty’ for all
our stakeholders. To deliver on our
purpose requires us to not only be
consistently profitable but also plan
and operate in a responsible manner.
In FY22, COVID-19, the Ukraine conflict as well as a
series of natural disasters reinforced how external issues
can impact business. In recognition of the criticality
of sustainability to the future success of Perenti we
emphasised the intention to “embed sustainability into
everything we do” with the launch in June 2022 of the
Perenti 2025 Strategy update.
In practice, this means, amongst other things:
•
Integrating sustainability considerations in key business
processes such as those relating to business planning,
project tendering, risk and opportunity management,
investment evaluation and capital allocation.
• Focusing on safety improvement projects.
• Ensuring our performance and service offerings
are aligned with external stakeholder and market
expectations.
•
Incorporating sustainability into our operating model
and organisational structure.
• Reviewing our business to ensure plans are developed
to access and address sustainability-related risks and
opportunities, including climate change physical and
transition risks.
• Transparently disclosing our position and performance
on issues that our stakeholders care about.
• Ensuring roles and responsibilities relating to
sustainability are clear from the Board to operational
levels.
• Supporting the mining industry's efforts to improve its
position and approach on material sustainability issues.
During FY22, we have continued to improve our overall
approach and performance including:
Environment
Social
Governance
Active participation in the Electric Mine
Consortium including trialling of electric
plant on operating sites.
Delivered Group Executive training on
climate change.
Developed a Decarbonisation Plan to
help focus our efforts and activities going
forward in line with our clients and broader
societal ambitions.
Introduced CheckMate, a tool for
frontline employees to ‘check’ the critical
safety controls are in place and working
effectively prior to commencing work.
Progressed a technology solution on
collision avoidance to improve pedestrian
safety in underground operations.
Published our Eliminating Sexual
Harassment Position Statement and
launched the associated It’s Not OK
campaign that aims to eliminate sexual
assault, sexual harassment and other
harmful behaviours from our workplace.
Published our Human Rights Policy and
continued the implementation of our
Human Rights Action Plan.
Invested in local communities with
~$1.5 billion in local procurement and
89% local employment rate.
Established a Sustainability Committee to
provide oversight and strategic direction
on material sustainability issues for the
business.
Delivered tailored anti-corruption and anti-
bribery training to high-risk roles across the
business.
Launched a data protection standard for
the Group.
Updated the Code of Conduct to
incorporate expectations relating to sexual
harassment and other harmful behaviours.
STRUCTURE AND SCOPE
As in previous years, this Sustainability Report is designed
around our Sustainability Framework that is based on our
five principles. We also continue to progressively expand
the performance metrics we report on, which are aligned
with internationally recognised standards such as GRI.
To that end, we are keeping abreast of developments in
disclosure standards including those of the International
Sustainability Standards Board. We are also progressively
aligning our disclosure with the Taskforce on Climate-
Related Financial Disclosure Framework (see page 39 of
this report).
OUR PRINCIPLES
NO
SHORTCUTS
NEVER
WASTEFUL
SMARTER
TOGETHER
WALK IN
THEIR SHOES
ENABLE
TOMORROW
31
PERENTI – ANNUAL REPORT 2022 INTRODUCTION
MATERIAL ISSUES
Perenti has undertaken a materiality assessment
involving internal and external stakeholders
to inform the development of our Strategic
Sustainability Plan. Further details regarding our
materiality assessment approach were provided
in our 2021 Sustainability Report.
Our priority sustainability issues are shown in
the graphic to the right. Safety remains our
most material issue. Despite significant progress
made, Perenti’s health and safety performance
throughout the year was overshadowed by
the death of three of our colleagues in two
separate events. Further details on our safety
performance and approach is detailed on page
41 of this report.
Perenti’s material sustainability issues are
reviewed every three years and the materiality
assessment will be updated in FY24.
I
T
N
E
R
E
P
O
T
E
C
N
A
T
R
O
P
M
I
IMPORTANT ISSUES
Innovation and technology
Workforce management
Community relations
Water use & management
Cyber security
Supply chain
Waste management
Land rehabilitation
HIGHEST PRIORITIES
Safety
Workplace health & wellbeing
Governance
Financial performance
Business ethics & anti-corruption
Climate change
Community involvement
Indigenous engagement
Talent attraction and retention
Security
Diversity and inclusion
Labour relations
Human rights and modern slavery
IMPORTANCE TO STAKEHOLDERS
UNITED NATIONS SUSTAINABLE
DEVELOPMENT GOALS
The United Nation’s Sustainable
Development Goals (SDGs) were
developed as a call to action
for governments, business and
communities to work together to end
poverty, fight inequalities and protect
the planet. The SDGs define 17 goals
and accompanying targets focus on
the most urgent economic, social
and environmental challenges facing
society today. The SDGs were adopted
in 2016 by all 193 UN Member States
with the intention of achieving the
goals by 2030.
Many of Perenti’s activities and
initiatives contribute in a meaningful
way to the SDGs (see table), including
our own goals and commitments
which are outlined at the beginning of
each section of this report.
Material Issue
Perenti contribution to the goals
UN SDG
Read more
Environmental Contribution
Climate change
Perenti is taking action by addressing the
transitional and physical risks of climate
change. We are also collaborating with
others to reduce our scope 1, 2 and 3
greenhouse gas emissions.
Social and Economic Contribution
Safety
Workplace health
and wellbeing
Perenti remains committed to maintaining
working environments that mitigate
occupational health and safety hazards
and protect the health and wellbeing of
our people.
Governance
Business ethics and
anti-corruption
Security
Human rights and
modern slavery
Inclusion and
diversity
Talent attraction
and retention
Labour relations
Indigenous
engagement
Decent work and
economic growth
Perenti aims to conduct business in a
transparent manner in compliance with
the laws of the countries in which we
operate. We strive to act with integrity
and maintain trust with our shareholders,
communities and other stakeholders.
Perenti aims to mitigate and respond
to security risks that may result from
political, economic or social factors.
We manage security in a manner that
protects our people and our operations
while promoting human rights.
Perenti has further progressed its
approach to human rights and modern
slavery in FY22 with the overall objective
of identifying, mitigating and preventing
human rights infringements and risks.
Perenti seeks to recruit and retain talented
and qualified individuals and ensure
all people systems and practices are
inclusive and deliver diversity outcomes.
We promote the social and economic
wellbeing of employees and respect
internationally recognised workers’ rights.
Perenti works to create genuine,
respectful and productive relationships
with Indigenous groups.
We are committed to local employment,
training and procurement. Central to
Perenti’s 2025 Strategy is the generation
of competitive returns that in turn attract
further capital investments.
Page 38
Page 41
Page 45
Page 34
Page 34
Page 36
Page 36
Page 47
Page 48
Page 48
Page 49
In Annual
Report on
page 16 and
on page 49
32
PERENTI – SUSTAINABILITY REPORT 2022ABN 95 009 211 474
INTRODUCTION
SUMMARY OF OUR PERFORMANCE
Metric
2022
2021
2020
NO SHORTCUTS
Ethics and Governance
Compliance with Code of Conduct
Compliance with continuous disclosure
# breaches
# breaches
Safety and Health
Total fatalities
#
Lost Time Injury Frequency Rate (LTIFR)
# incidents per million hrs worked
Total Recordable Injury Frequency Rate (TRIFR)
# incidents per million hrs worked
All Injury Frequency Rate (AIFR)
# incidents per million hrs worked
Serious Potential Incident Frequency Rate (SPIFR)
# incidents per million hrs worked
Fines and Prosecutions
#
NEVER WASTEFUL
Environment
Greenhouse gas emissions – scope 1
Greenhouse gas emissions – scope 2
Energy consumed
Total significant environmental incidents
Fines and prosecutions
SMARTER TOGETHER
Our people
Total workforce
Employees by Region:
• Australia
• Africa
• United Kingdom
• North America
Total voluntary turnover rate
Females on the Board 1
Females in senior management
Females in the workplace
Australian workforce employed as an apprentice
Australian workforce provided with a traineeship
WALK IN THEIR SHOES
Local participation in international workforce2
Local procurement expenditure3
Community investment and donations
tonnes CO2-e
tonnes CO2-e
Gigajoules
#
#
#
%
%
%
%
%
#/%
%
%
%
%
%
AUD$
AUD$
0
0
3
0.5
6.9
28.9
2.8
0
0
0
1
0.4
5.1
26.5
2.9
0
0
0
1
0.3
4.9
26.2
4.1
0
2,323
4,361
3,462
5,193
6,456*
5,546
63,655
99,865
125,424
0
0
0
0
0
0
8,939
7,881
7,729
38.9
56.7
<1.0
4.3
26.6
2/29
18.8
10.6
4.4
8.1
40.8
53.2
<1.0
4.6
17.0
2/31
18.2
10.0
4.4
8.0
37.1
62.7
<1.0
<1.00
14.7
2/29
16.2
8.6
5.0
89.4
1.48B
86.8
1.12B**
368,601
244,500
88.2
-
-
* Includes emissions associated from exploration activities which is outside of our operational control.
** FY21 local procurement spend corrected due to an administrative error.
1. Females on the Board for FY22 is based on the absolute number at the end of the financial year. The FY21 figure is based on average of days worked.
2 Local participation is country Nationals (Locals) only, does not include third country nationals.
3 Local procurement expenditure refers to the purchasing of goods or services from a supplier registered or based within the same country as the operation.
33
PERENTI – ANNUAL REPORT 2022 NO SHORTCUTS - ETHICS & GOVERNANCE
NO SHORT CUTS
ETHICS AND GOVERNANCE
OUR COMMITMENTS
Perenti made the following FY22 commitments:
FY22 commitment
Status
Reference
In FY23 we will:
Cyber and information security:
Develop and roll-out a data protection
standard for the Group.
Review the coverage of sustainability
matters within the Board structure and
meeting program.
Board undergoes climate change training
to ensure their understanding of climate
related developments is current.
Ensure human rights related provisions
within contracts and service agreements
are applied consistently across the Group.
Cyber and information
security, page 35
Board structure, page 34
Climate change, page 38
Human rights and modern
slavery, page 36
Undertake two crisis and two
emergency management training
exercises across the Group.
Conduct one second line assurance
audit of the division level emergency
management plan and project (site)
emergency response plan.
Implement the Perenti Governance
Framework, including a single
document management platform
across the organisation.
Deliver tailored human rights
training to high-risk roles across the
Group.
Undertake a human rights audit of a
high-risk category supplier.
BOARD STRUCTURE
RISK AND INTERNAL AUDIT
The Perenti Board is comprised of the relevant skills, diversity
and experience to ensure ethical and responsible delivery
of value to shareholders. The composition of the Board is
reviewed annually by the Nominations Committee. As at
30 June 2022, the Board comprised seven Directors, six of
whom are non-executive directors. Details of each Board
member, including their skills, experience and term of office are
set out in Perenti’s 2022 Annual Report and are also available
on Perenti’s website.
Perenti faces a broad array of risks, including operational,
economic, technological, geo-political, regulatory,
environmental and reputational risks (see page 56 of the
Annual Report for further information). Perenti’s approach
to sustainability risk and opportunity is integrated into our
overarching risk management framework, which is aligned with
ISO 31000:2018 and the ASX Principles and Recommendations.
Sustainability related risks are assessed involving cross-
functional input from across the business.
The Board Charter requires a majority of directors to be
independent, with an assessment of the independence of
each Non-executive director being undertaken in August 2021
in accordance with ASX Recommendations and Principles. The
Board currently has four committees to assist in carrying out
the role of guiding the Company’s strategic direction – the
Audit & Risk Committee, People & Remuneration Committee,
Sustainability Committee (established in February 2022) and
the Nominations Committee (established February 2022).
The charters for these committees are available on Perenti’s
website. The members of the committees are all independent
directors.
The newly formed Sustainability Committee met in February
and June 2022. Topics discussed by the committee included
safety, sustainability strategy, climate change, human rights
and modern slavery, investor expectations, sustainability
disclosure and environmental management. Safety and
sustainability related issues are also discussed collectively by
the Board. For example, climate change was discussed as part
of the Board Strategy Workshop in December 2021.
The approach utilises an enterprise-wide process to identify
and assess material risks to the Group and seeks to apply
appropriate controls. Our top-down/bottom-up risk framework
enables the Group to make informed decisions and effectively
prioritise resources. The framework views risk from a variety of
time horizons which allows for detection and investigation of
emerging risks and effective evaluation of risks against longer
term strategic objectives.
The Internal Audit function was established in August 2020
and is a critical part of the Perenti Assurance Framework. The
purpose, role and authority of Internal Audit is governed by a
charter approved by the Audit and Risk Committee. The Audit
and Risk Committee approved the FY22 Internal Audit Plan.
Twelve internal audits were completed during FY22. The
audits largely focused on the adequacy of the health, safety
and environmental systems, critical control management and
reporting. The audits included an assessment of how effective
these systems and controls were implemented and used across
Perenti’s operations. Internal audit actions were raised during
the year to strengthen controls and improve systems and
processes. The actions are subject to a governance process
and are tracked until closed.
34
PERENTI – SUSTAINABILITY REPORT 2022ABN 95 009 211 474
NO SHORTCUTS - ETHICS & GOVERNANCE
The FY23 Internal Audit Program will continue to have a health,
safety and environmental focus, together with key financial and
business processes.
CODE OF CONDUCT
Our Code of Conduct sets out the standards of behaviour
expected of our directors, employees, consultants, contractors
and suppliers. In FY22, the Code of Conduct was updated
to specifically reference harmful behaviours in line with our
Eliminating Sexual Harassment Position Statement.
During the past year we also monitored compliance with the
mandatory learning module for the Code of Conduct, with
all employees required to complete refresher training at least
every two years.
SUPPORTING A CULTURE OF SPEAKING UP
Perenti is committed to achieving and demonstrating the
highest standards of ethics and corporate governance. Policies
and standards are in place to provide guidance to directors,
executives and employees in the management and running of
our operations.
Perenti has a Speak Up Program in place across the business
in the relevant local language. The Speak Up Program gives
employees, and other stakeholders, a range of options to report
misconduct while providing anonymity and protection to the
person reporting the misconduct. The program is supported
by a Speak Up Policy and Standards specific to the countries in
which Perenti operates.
In FY22, there was one disclosure made through the Speak Up
Program that was classified as a non-material Code of Conduct
issue. The allegation relates to a potential misuse of a minor
amount of funds.
ANTI-BRIBERY AND ANTI-CORRUPTION
Perenti has an Anti-bribery and Anti-corruption (ABAC) Policy
which sets out the Company’s zero tolerance for any bribery
or corruption in its business dealings and operations anywhere
in the world. The Company also has a related ABAC Standard
which sets out the specific requirements of our Company’s
employees and suppliers related to the policy. Consistent with
this standard, no political donations or facilitation payments
were made during FY22. Any material breaches of the ABAC
Policy are reported to the Board and Audit & Risk Committee.
No breaches were reported in FY22.
In FY22, the Company monitored compliance with the online
training module for ABAC for all new employees as part of
their induction as well as a tailored module for 372 employees
working in ‘high-risk’ roles. These roles include all supervisor
positions and above, as well as those involved in commercial
interactions such as procurement. As of the time of reporting,
71% of those identified as high-risk roles had completed the
ABAC training with the remainder to complete the training in
Q1 FY23.
TIMELY AND CONSISTENT DISCLOSURE
Our Market Disclosure and Communications Policy outlines
Perenti’s commitment to providing our shareholders and the
market with full and timely information about our activities. In
the last financial year, the Company made 73 announcements
and disclosures via the ASX with no breaches of continuous
disclosure.
CYBER AND INFORMATION SECURIT Y
In FY22, Perenti’s Security Program delivered extensive
people, process and technology capability improvements
which have strengthened our security position by reducing
risk and exposure. Key activities of the Security Program
included the deployment of a sophisticated market-leading
vendor managed platform for the detection, response and
remediation of malicious activity and behaviour across Perenti’s
device network. The program also established a 24x7 security
operations centre, delivered in partnership with a leading
security service provider.
A range of other security enhancements were delivered
under the program, including implementation of device-level
encryption, risk-based conditional access to Microsoft 365,
an enterprise password management solution and identity
and access management-related enhancements. Security
awareness campaigns were delivered throughout the business
in FY22 which focused on reinforcing cyber-safe security aware
behaviours.
A Data Protection and Privacy Group Standard was developed
in FY22 and will be implemented in FY23.
INDUSTRY ASSOCIATION MEMBERSHIPS
Perenti, or its operating businesses, are members of peak
bodies and organisations including:
• Association of Mining and Exploration Compaines (AMEC) –
Associate member
• Australia-Africa Minerals and Energy Group (AAMEG)
• Australian Resources and Energy Employer Association
(AREEA) - member of the Mental Health working group
• Austmine
• Chamber of Minerals and Energy Western Australia (CMEWA)
- Member of the Work Health and Safety and the Safe and
Respectful Behaviours working group
• Gold Industry Group
In accordance with the ABAC Policy and Standard, all
businesses have a gift and hospitality register in place,
maintained by nominated employees within each business
and reported and consolidated at a Group level.
• Minerals Council of Australia – Member of the Safety and
Sustainability Committee.
Our engagement with these organisations is consistent with the
Perenti Code of Conduct.
35
PERENTI – ANNUAL REPORT 2022 NO SHORTCUTS - ETHICS & GOVERNANCE
HUMAN RIGHTS AND MODERN SL AVERY
Upholding human rights is core to our principles at Perenti.
We are committed to respecting human rights, cultures
and customs of employees, communities and suppliers
by implementing practices consistent with recognised
international standards including the Voluntary Principles on
Security and Human Rights. This commitment is included
within our Code of Conduct and associated training module
for employees, which sets out employee expectations, and was
further strengthened in FY22 with the publishing of our Human
Rights Policy.
In FY22, we submitted and published our second public Modern
Slavery Statement in accordance with the Commonwealth
Modern Slavery Act 2018. Our commitment to ensuring
human rights related provisions within contracts and service
agreements are applied consistently across the Group was
completed in FY22. All Perenti supplier agreements now require
suppliers to acknowledge compliance to the Perenti Modern
Slavery Statement requirements.
We continue to strengthen our governance framework with
the development of a Human Rights Modern Slavery training
package aimed at our procurement team, a supplier audit
protocol and accommodation checklist. FY23 will see these
processes and tools embedded into our current systems.
SECURIT Y
Perenti is committed to ensuring we maintain a state of
security, emergency, and crisis preparedness to enable us to
prevent, respond and recover from security and other events
which may impact our people, the environment, assets,
business operations or reputation.
The Group continues to adopt a holistic approach to the
management of security, emergency and crisis related risks
which is supported by a suite of standards and associated plans
and guidelines.
A significant priority for FY22 was the continued COVID-19
response, in particular the planning and coordination of crew
change operations.
Our security, emergency and crisis management capability has
been further strengthened through the provision of training to
corporate and site teams in both Africa and Australia. A number
of crisis and emergency exercises were also conducted during
the past year in line with our training program.
36
PERENTI – SUSTAINABILITY REPORT 2022ABN 95 009 211 474 NEVER WASTEFUL - ENVIRONMENT
NEVER WASTEFUL
ENVIRONMENT
OUR COMMITMENTS
Perenti made the following FY22 commitments:
FY22 commitment
Status
Reference
In FY23 we will:
Publish a Climate Change Position
Statement consistent with the Taskforce
on Climate Related Financial Disclosure
Framework.
Further formalise and progress our
decarbonisation efforts.
Deliver climate change training to
the Board.
Climate Change, page 38
Emissions and
Decarbonisation, page 38
Climate Change, page 38
Establish an internal water and energy
efficiency initiative platform to record, track
and improve collaboration on water and
energy initiatives throughout the business.
Water, page 40
Develop and commence
implementation of a Group
Environmental Management
Standard.
Publish a Climate Change Position
Statement.
Capture and disclose our scope 3
emissions associated with fuel use
on our client sites.
Set a scope 1 and 2 greenhouse
emissions reduction target.
Capture and disclose water use and
waste for our office and workshop
facilities.
We are committed
to minimising the
environmental impact of
our operations and offices
through the education of
our employees, utilising
best practice procedures,
complying with legislation
and conforming to any
specific environmental
requirements of individual
sites and clients.
During the reporting period we progressed
actions identified in our three-year
Environmental Business Plan which
included the development of a Group-
level environmental risk register, refresh of
environmental induction material, distribution
of environmental education ‘toolboxes’ to
sites and capturing GHG data in our
HSE information system.
Focusing on what Perenti can influence
Perenti aims to improve the sustainability performance
of systems and processes under our control and
influence. Importantly, there are several mining
processes on client sites where we operate, for which
we do not offer services or have influence to change.
Perenti does not design, maintain or operate tailings
storage facilities for our clients. We recognise the
potentially significant risk tailings storage facilities
pose to the safety and health of people, infrastructure
and the environment, if not effectively managed and
governed. Rehabilitation is typically the responsibility of
the mine operator and is managed by Perenti’s clients.
As a mining services provider Perenti is not the mine site
owner involved in the planning or approval phase of a
mining project and therefore does not contribute to pre-
mining activities such as obtaining regulatory approvals,
developing an environmental and social impact assessment,
stakeholder identification and consultation, resettlement,
and establishing free, prior and informed consent. Perenti
recognises the importance of maintaining the biodiversity
that underpins ecosystem functioning and is aware of
developing industry initiatives such as the Task Force
on Nature-related Financial Disclosure. Avoiding and
minimising biodiversity impacts of the mine is typically
managed early in the project life cycle by our clients,
who are also responsible for monitoring, restoring and,
if necessary, offsetting residual impacts.
The above-mentioned requirements are the responsibility
of Perenti’s clients at all our locations. Perenti recognises
the importance of these processes and acts in accordance
with any regulatory approvals obtained by the operator,
as well as the laws and regulations of the host country.
37
PERENTI – ANNUAL REPORT 2022
NEVER WASTEFUL - ENVIRONMENT
ENVIRONMENTAL MANAGEMENT SYSTEM
Our environmental management practices are directed by our
Health, Safety and Environment Policy and our Sustainability
Policy. The Health, Safety and Environment Management
System described in the health and safety section of this report
is consistent with the requirements of ISO 14001 and forms the
framework for how environmental management is planned,
executed and governed.
During the reporting period, a comprehensive review of
environmental risk registers from across the business was
conducted. The review has applied a consistent methodology
across different business units, providing a robust group level
environmental risk register. Both business environmental
management plans and the environmental inductions have
been reviewed and updated to align and address risks identified
in the risk review.
Greenhouse gas (GHG) reporting processes were enhanced
in the reporting period with the introduction of centralised
reporting into the Perenti HSE information system. This has
strengthened data reliability and transparency as well as
verification processes.
Sustainability considerations were reviewed and refined to
optimise the sustainability impact in the reporting period.
This has included emission calculations being embedded
into tendering estimates and high-level risk reviews of other
sustainability issues.
The environmental awareness program was strengthened in the
reporting period with the development and implementation of
a business-wide environmental communication plan. Outputs
from the plan have included country specific environmental
toolbox posters on a range of topics and a sustainability
ideas form which encourages personnel from all parts of the
business to submit improvement ideas.
An internal sustainability working group was established in
the reporting period. The purpose of the working group is
to improve sustainability understanding, engagement and
performance across the business.
Outcomes of the physical risk assessment will supplement
existing business processes such as risk management,
emergency response and preparedness, and operational
planning. The transitional risk and opportunity assessment will
provide industry specific insight into issues on climate related
policy and legal risks, technology and market changes and
reputational risks.
EMISSIONS AND DECARBONISATION
As a mining service provider it is important for Perenti to
differentiate scope 1, 2 and 3 emissions to understand
our GHG risk exposure and prioritise our decarbonisation
efforts. Our scope 1 emissions are comprised of mobile
and stationary combustion of fuels at locations under our
operational control, which include our off-site workshops,
warehouses and offices. Our scope 2 emissions comprise
entirely of purchased electricity. Scope 3 emissions are
considered to be indirect emissions that occur in the value
chain, including both upstream and downstream emissions.
A diagram demonstrating Perenti’s FY22 emissions profile by
scope is provided below.
OPER ATIONAL CONTROL
Hydrocarbon consumption at our off-site
workshops and onsite power generation.
Purchased electricity at our offices and off-site workshops.
1
E
P
O
C
S
2
E
P
O
C
S
CLIENT & VALUE CHAIN
CLIMATE CHANGE
Perenti remains committed to acting on climate change by
responding to physical and transitional risks and opportunities
while playing our role in industry efforts to support the
transition to a low carbon economy. We consider transparency
in climate change response and management to be a
fundamental practice in the collective action on climate
change.
3
E
P
O
C
S
Vehicles and equipment provided to client sites,
electricity at client sites, material value chain
emissions, employee commuting.
The key climate-related actions completed by Perenti in FY22
include:
• Established the Sustainability Committee which has
oversight of climate-related issues, including carbon
emissions reduction and climate change risk and
opportunity management.
• Delivered climate change training to the Board.
• Developing a Decarbonisation Plan to define the themes
of work and associated activities required to support us
decarbonise our operations and value chain.
Perenti is undertaking a business-wide risk and opportunity
assessment for the physical and transitional impacts of climate
change. The comprehensive assessment is guided by the
recommendations of the Taskforce for Climate related Financial
Disclosure and is scheduled for completion in the first half of
FY23.
Since 2020, we have measured and disclosed the
greenhouse gas emissions under our operational control
(i.e. scope 1 and 2). A summary of Perenti’s emissions and
energy consumption since 2020 is provided in the performance
summary table on page 33. In FY22, emissions under our
operational control reduced by 23% from the previous year.
Stakeholders are becoming increasingly interested in
understanding businesses’ material scope 3 emissions and
management approach. Perenti recognises scope 3 emissions
as relevant to our business given they comprise a large portion
of our overall emissions profile and contribute to GHG risk
exposure. Accordingly, in 2022 we began tracking what we
believe to be our most significant and actionable scope 3
emissions source, which is fuel consumption and emissions
from our equipment at our client’s sites. We are aiming to
disclose our scope 3 emissions associated with fuel use on
our client sites in FY23.
38
PERENTI – SUSTAINABILITY REPORT 2022ABN 95 009 211 474
NEVER WASTEFUL - ENVIRONMENT
TASKFORCE ON CLIMATE REL ATED FINANCIAL DISCLOSURES
Perenti supports the Task Force on Climate related Financial Disclosures (TCFD) as a framework to increase reporting of climate
related financial information. In 2022, we made the commitment to progressively align our approach to the recommendations of
the TCFD. A summary of key Perenti practices and actions being taken to meet the TCFD framework is provided in the table below.
TCFD PILL AR
CURRENT PROGRESS
FUTURE ACTIONS
Governance
Strategy
• Perenti will review oversight of climate change
responsibilities at the executive level following
completion of the scenario analysis and
physical risk assessment. Further clarification of
responsibilities will be defined if needs arise.
Established in 2022, the Sustainability Committee
has oversight of climate-related issues at Perenti,
including carbon emissions reduction and climate
change risk management.
The Chief People & Sustainability Officer, who
reports to the Managing Director & Chief Executive
Officer, has overall responsibility for ensuring
climate change risks and opportunities are assessed
and managed.
Accountability for specific climate-related risks and
opportunities are allocated to relevant roles within
the business.
The Group Executive has received climate change
training to enable informed consideration of
climate-related issues during
the annual risk review.
Announced in June 2022, Perenti’s Strategy update
outlines Perenti’s intention to embed sustainability
in everything we do.
The risks and opportunities of climate change
is considered as part of the Board’s strategy
framework.
Climate change and carbon emissions have been
acknowledged as an emerging risk and material
issue in our 2022 Annual Report and Sustainability
Report.
We have developed a Decarbonisation Plan which
outlines the focus areas and activities to support us
to decarbonise our operations and align with our
clients' climate-related ambitions. Furthermore,
our operational technology roadmap includes
electrification of the fleet as a key consideration.
• Perenti will continue to assess and disclose
climate-related risks as part of our internal risk
assessment process, with an aim of improving
the level of detail over time.
• We are in the process of undertaking scenario
analysis in accordance with the methodology
proposed in the TCFD Technical Supplement
for Scenario Analysis. This will enable us to
describe the impact of climate-related risks and
opportunities on Perenti’s strategy and plan
accordingly.
• Perenti has included its first ESG related
performance metric, in our FY23 short-term
incentive program. This will focus on our plan
around scope 1 and 2 emissions. This will
continue to be assessed and refined over time.
Risk management
Perenti’s approach to climate-related risk is
integrated into our overarching risk management
framework, which is aligned with ISO 31000:2018
and the ASX Principles and Recommendations.
Climate related risks are assessed involving cross
functional input from across the business.
In 2021, we completed a climate change risk
assessment of the business using bowtie
methodology with cross functional input.
Metrics and targets
Perenti has disclosed scope 1 and 2 emissions in
our annual Sustainability Report since 2020.
• The risk bowtie is evolving into a physical and
transitional risk assessment, scheduled for
completion in FY23.
• We will continue to review the management of
climate-related risks and opportunities within
our risk management systems, broader business
strategy and investment decisions to ensure our
business is resilient to changes in climate.
• Outcomes of the climate change scenario
analysis and physical risk assessment will
be integrated into Perenti’s overarching risk
management framework.
• Perenti will integrate climate-related
considerations within the investment due
diligence process.
•
•
In FY23, we will undertake pre-assurance of
greenhouse gas and energy data.
In FY23, we will announce our targets in relation
to operational control emissions. Six-monthly
reviews will be established to assess progress
towards goals.
39
PERENTI – ANNUAL REPORT 2022 NEVER WASTEFUL - ENVIRONMENT
WATER
Perenti recognises that water is a shared
natural resource that has environmental,
social, cultural and economic value.
Access to and monitoring of water use
at mine sites is managed by Perenti’s
clients. In FY22, we committed to identify
water opportunities at high water risks
sites, however given this is managed by
our clients this has proved challenging.
Therefore, operational improvements
and supporting our client’s water
management goals continue to be the
focus. Water consumption at facilities
within Perenti’s operational control
comprises the minority of Perenti’s
overall water consumption.
In FY21, Perenti completed a water risk
assessment of all our operations using
World Resource Institute’s Aqueduct tool.
Perenti is now using this information to
supplement a comprehensive climate
scenario analysis which includes a risk
assessment of the physical risks of
climate change. Due for completion in
FY23, the climate change physical risk
assessment will inform our approach to
water management at a regional level.
In the last Sustainability Report we
committed to establishing an internal
water and energy efficiency initiative
platform to record, track and improve
collaboration on water and energy
initiatives throughout the business.
Perenti delivered on this commitment
by launching the internal sustainability
ideas form. The sustainability initiative
portal is accessible to all employees
and contractors within the business and
provides a mechanism to share water
saving opportunities and initiatives.
ENVIRONMENTAL INCIDENTS
Environmental incidents are classified
on a scale of one to five with four and
five resulting in serious impact to the
environment and regulatory action. Over
the past three years we have not had any
level four or five incidents.
Climate change is a significant factor
when it comes to managing water
and the Perth community. In FY22,
the Water Corporation engaged idoba
to collect and analyse 12 months of
water data to provide insights into
water usage and better plan for the
future. idoba used predictive analysis
and advanced data science techniques
to link client behaviour to lifestyle and
water use.
Algorithms were applied across all
clients using Amazon Web services,
40
SOLAR
LIGHTING
TOWERS
In July 2021 Ausdrill replaced two
diesel lighting towers with solar-
battery units. The zero emissions
towers have saved about 17,000 litres
of diesel, or 45 tonnes of CO2-e, in
FY22. The towers have the added
benefit of operating without engine oil
and coolant and significantly reduce
maintenance hours in comparison to
the diesel units.
LANDCRUISER
ELECTRIC
CONVERSION
Barminco, as part of the Electric Mine
Consortium, is leading the light and
auxiliary vehicle working group which
aims to accelerate the adoption of
electric vehicles by integrating them
into operating mine sites. In FY22,
Barminco successfully converted a
diesel single-cab Landcruiser to full
electric, which is now being trialled at
IGO’s Nova mine in Western Australia.
The BeLV contributes to a safer
working environment in underground
operations through zero emissions and
reduced heat output. Trials for various
BeLV models will extend into FY23.
DELIVERING THE
DATA AROUND
WATER USE AND
POPULATION
GROWTH
CSIRO aerial photogrammetry and
high-frequency smart meter data to
develop a robust analysis tool. The
tool allows the Water Corporation to
differentiate between different water
streams, establish new baselines,
understand what drives water use
and make decisions on impact and
infrastructure based on accurate future
predictions. The tool will inform water
management decisions in a future
of changing water use patterns and
climate change.
CASE STUDYCASE STUDYCASE STUDYPERENTI – SUSTAINABILITY REPORT 2022ABN 95 009 211 474 SMARTER TOGETHER - SAFET Y & HE ALTH
SMARTER TOGETHER
SAFETY AND HEALTH
OUR COMMITMENTS
Perenti made the following FY22 commitments:
FY22 commitment
Status
Reference
In FY23 we will:
Continue to embed the HSE Information
system and improve downstream HSE
processes, further standardising good
practice across the Group.
Complete a third line audit against the
requirements of the Health Safety and
Environment Management System to assess
compliance and share best practice.
Complete the rollout of phase one of the
Safety Leadership Program to all senior
leaders and initiate the implementation of
phase two of the program.
Complete the development of and
implement Critical Control Operator
Verifications, as well as develop Critical
Control System Verifications.
HSE Information System –
HSE Central, page 42
Critical Risk Management,
page 43
Safety Leadership, page 44
Critical Risk Management,
page 43
Receive independent reports on
fatalities and take decisive action.
Undertake an independent
assessment of the safety culture and
capability across Contract Mining
Division, seeking a step change in
safety outcomes.
Roll out a critical control operational
level verification process at 100% of
all operational sites.
Develop and implement high-risk
task critical control verifications for
leaders at 100% of all operational
sites.
The physical and
psychological health,
safety and wellbeing of
our people is foremost
at Perenti and we
are committed to the
elimination of life-
altering physical and
psychological injuries
and illnesses. We will
achieve this through
continuing to advance
our safety culture and
leadership, managing our
critical risks and controls
and ensuring safe and
effective systems are in
place.
Our Health, Safety and Environment
Management System meets the
requirements of ISO 45001 and provides
the framework for planning, executing
and governing health and safety
management at Perenti.
SAFET Y PERFORMANCE
While we have made significant progress
in maturing our safety approach,
strengthening the foundations and
focusing the organisation on the
management of critical risks and their
controls, we have failed to deliver on
our objective of no life changing events.
Over the reporting period, two separate
tragic incidents have claimed the lives
of three of our employees. At the Hemlo
mine in Canada, Troy Cameron lost
his life when he was caught between
ventilation doors underground and at
the Zone 5 mine in Botswana, Baleseng
Sechele and Moses Marpaung also lost
their lives in an event underground after
being overcome by blasting fumes.
Working with our clients, we have
investigated the nature of these tragic
events and will ensure these findings
inform our safety programs and ongoing
focus on preventing life-changing
events. Actions derived from the
investigation to the Hemlo incident
have already been rolled out across the
business and are captured within many
of the improvement initiatives detailed in
this report.
Over the past 12 months our continued
focus on safety and leadership
development has resulted in a slight
decline in our Serious Potential Incident
Frequency Rate (SPIFR) from 2.9 to 2.8.
However, we have also recorded an
increase in our Total Recordable Injury
Frequency Rate (TRIFR), which has risen
from 5.1 to 6.9 over the reporting period.
While the majority of these recordable
injuries are from low-impact events
that are not life-changing – 41% of all
recordable injuries involve hands and
fingers – we understand we need to do
more to reduce all injuries across the
business.
Targeted programs for prevention of
hand and finger injuries have been
implemented and involve engaging our
frontline supervisors in conversations to
verify hand safety controls are available
and being used correctly. A customised
program has been developed with a
specialist injury prevention provider to
support enhanced physical capabilities
for key diamond drill roles. The program
takes into consideration the type of work
undertaken and each person’s unique
physical capabilities.
In FY23, Perenti will introduce an early
intervention physiotherapy program
providing early treatment in addressing
musculoskeletal injuries that minimises
the impact of the injury and improves
return to work time.
41
PERENTI – ANNUAL REPORT 2022
SMARTER TOGETHER - SAFET Y & HE ALTH
Throughout FY22, we continued to focus
on strengthening Critical Risk Controls
and building the capability of our leaders
in understanding and enabling safe
work through their teams. An analysis
of the Serious Potential Incidents (SPIs)
by critical risk category demonstrates
that almost a third (28%) of SPIs relate
to mobile equipment operation and
interaction. This is closely followed with
27% of SPIs relating to the control of
ground conditions and 15% of incidents
involving the risk of isolation and control
of hazardous energy sources. Such
outcomes are consistent with industry
peers.
HEALTH, SAFET Y AND
ENVIRONMENT (HSE)
INFORMATION SYSTEM
In early FY22, a new HSE information
system for the collection, analysis
and reporting of HSE related data was
implemented across the Group. The
purpose of the new system, branded
internally as HSE Central, is to provide
a common platform and single source
of truth for managing HSE data across
the organisation, enabling better
understanding of performance and
development of strategic insights.
Key objectives of the system include
improving:
•
•
the ease of conducting critical control
verifications in the field for frontline
leaders and employees;
the ability of frontline leaders and
employees to input and manage
HSE incidents to support improved
learning;
• data integrity of HSE data and
reducing duplication of effort by
employees and leaders; and
•
the ability of the business to obtain
relevant HSE data to inform risk-
based decision making and enhanced
workplace practices.
Since its rollout, HSE Central has
continued to develop and improve
systems and processes. Notable
improvements from the implementation
include:
•
improved analysis of incidents and
injuries, enabling the identification of
trends and key issues for improving
organisational learning and control of
risks; and
• providing insights into the health
of critical risk controls to help
inform leaders decisions and
further improvements to critical risk
management.
42
CASE
STUDY
HELPING HANDS
As part of the challenge participants
covered their preferred hand with a
drink holder and could only use their
non-dominant hand to complete
the exercise, simulating the loss of
use or sustained significant injury to
their favoured hand. The aim of the
activity was to get employees to think
differently about the importance of
hand safety in their own day-to-day
job and consider limitations with a
significant hand injury, while also
making a real and lasting contribution
to others less fortunate.
The exercise was paramount in
reinforcing Perenti’s Smarter together
and No shortcuts principles and a
unique way to have a positive impact
on people in need.
At Perenti, our businesses transcend
borders. Working across three
continents and providing significant
support to the resources sector
globally exposes the company – and
its employees - to various cultures,
communities and environments.
Safety and controlling risk is
paramount across the workforce.
Yet still at BTP, statistics show hand
and finger injuries account for almost
40% of all injuries reported.
Recognising a need to think outside
the square in hand safety, BTP
engaged the Helping Hands Program
to stimulate the conversation
around hand injuries, do something
memorable and importantly, make a
lasting impression and give back to the
communities in which we operate.
The Helping Hands Program saw
apprentices undertake an engagement
exercise, building prosthetic hands
that were then donated to amputee
landmine victims throughout the
developing world.
PERENTI – SUSTAINABILITY REPORT 2022ABN 95 009 211 474 CRITICAL RISK MANAGEMENT
In direct support of Perenti’s goal for No
Physical or Psychological Life Changing
Events, our Critical Risk Management
(CRM) program engages employees in
the identification, elimination, control
and mitigation of fatal risks. The program
provides assurance that potentially life-
impacting health and safety risks are
known, understood and being effectively
managed through a combination of
improved frontline understanding of
critical risks and controls, program
assurance and robust governance.
An audit was commissioned across
the business to assess the design and
implementation of the Perenti Critical
Risk Standards by the Board Audit and
Risk sub-committee and was conducted
by Group Audit and an independent
external auditor. The audit was
undertaken at sites in Western Australia
(Fimiston, Nova and BTP Hazelmere),
Queensland (Dugald River) and Ghana
(Subika and Iduapriem) and found that
Perenti’s Critical Risk Management
requirements are broadly in line with
industry guidance. The audit also made
a number of positive observations and
identified gaps and opportunities for
improvement. Progress on the resulting
action plan is reported directly to the
Board Sustainability and Audit and Risk
Committees.
Perenti’s CRM program has focused
on the identification of critical risks
and controls, embedding verification
processes for frontline leaders (Critical
Control Field Verifications, or CCFVs),
the development of frontline worker
verification tools and continuous
improvement of CCFVs based on
lessons learned, industry best practice
benchmarking and feedback from the
workforce.
In FY22, Perenti developed and
implemented Critical Control Operator
Verifications, branded as “CheckMate”.
These are a tool for frontline operators
and maintainers to ‘check’ that the
critical controls that prevent fatalities
and life-altering injuries are in place and
working effectively prior to commencing
work. Further detail on CheckMate is
provided in the case study.
SMARTER TOGETHER - SAFET Y & HE ALTH
As unstable ground conditions
are one of the major hazards in
underground mining, we implemented
an independent audit program in FY22
to provide assurance of our controls
for the prevention of fall of ground
and slope stability with the support
of our clients. Five audits across our
Australian operations were completed
in the reporting period and covered Mt
Colin, Sunrise Dam, Savannah, Agnew,
and Odysseus operations, identifying
opportunities for improvement.
These recommendations have been
actioned to ensure robust quality
assurance and quality control processes
are in place and effective.
We have also undertaken audits across
a number of our international sites
including Iduapriem and Obuasi in
Ghana, Zone 5 in Botswana and Hemlo
in Canada. The findings from these
audits are under review and an action
plan is being developed. The action plan
will be reviewed by the Sustainability
Committee and will be implemented in
FY23.
CASE
STUDY
CHECKMATE –
NOT JUST ANOTHER
CHECKLIST
Our critical risk management program
was further strengthened in FY22
with the introduction of our Critical
Control Operator Verification process,
CheckMate. CheckMate is aimed
at our frontline workers, supports
Perenti's Critical Risk Management
framework and is an integral
component in embedding critical
control identification, control and
management.
In line with a clear mandate that these
tools are “for the workforce, by the
workforce”, Checkmate was developed
with extensive engagement and
consultation with our operator and
maintenance teams. Working groups
from across the business reviewed a
range of high-risk tasks relevant to
their work area and were charged with
identifying the physical critical controls
that will prevent potential life changing
events. The working group outcomes
were then reviewed and endorsed
by operational leaders before being
transformed into the CheckMate.
Importantly, CheckMate is not just
another checklist. They are designed
to complement processes already
in place such as equipment pre-
start inspections, personal field risk
assessments, job hazard analyses
(JHAs) and procedures. The tools
and implementation materials have
been developed in consultation with
safety communication experts and
have been designed with graphical
representation of each critical control
to limit literacy barriers.
CheckMate will support a progression
from leader compliance checks to the
more mature approach of enabling
frontline workers to take ownership
by understanding their critical
controls and ensuring these controls
are working effectively in an ever-
changing environment.
43
PERENTI – ANNUAL REPORT 2022 SMARTER TOGETHER - SAFET Y & HE ALTH
SAFET Y LEADERSHIP
Our safety leadership and critical risk
management programs are vital to
improving how we manage safety,
assess risk, train our people and work
towards achieving our objective of no life
changing events. In FY22, we delivered
the Thinking Differently About Safety
Program, across the business, which
has seen 126 leaders trained to date.
The program challenges our leaders to
think differently and covers topics such
as courageous leadership, culture and
critical risk management.
Our Know, Say, Do Program aimed
at frontline leaders was also rolled
out during the reporting period.
The program involved a series of
workshops with frontline and senior
leaders identifying the key items they
should know about safety, say about
safety, and do to lead and manage
safety in their day-to-day roles. The
Know, Say, Do Program culminated
in a frontline leader’s manual being
developed and adopted across the
African Mining Services business and
with other business units developing and
implementing similar tools to support
frontline supervisors.
As we look forward to FY23, a
significant body of work has already
been undertaken which will see the
launch of our No shortcuts campaign.
The campaign aims to foster safety
conversations in our frontline workforce
and motivate individuals to achieve
positive outcomes in their work that
includes returning home safely at the
end of each shift.
44
CASE
STUDY
COLLISION
AVOIDANCE
In line with mobile equipment
operation and interactions
representing a significant critical
risk category, and informed by
analysis and lessons learnt from
investigation into events within
the business and across industry,
Barminco has been exploring new
technology advancements to improve
pedestrian safety at our operations,
particularly within the confined
spaces of underground mining.
As one of the world’s leading
underground mining contractors,
Barminco currently operates projects
in six countries and employs more
than 5,400 people. Almost all of
these employees will be exposed
to a working Heavy Vehicle (HV)
during their career. These HVs are a
significant risk factor for people who
work in close proximity to them in an
underground environment.
Since September 2021, Barminco
has been working with Sandvik
and Newtrax to develop Collision
Avoidance System technology that
is superior to any Collision Warning
System currently available to industry.
The result of this partnership is
developing functionality that
will automatically intervene and
respond on behalf of a heavy
mobile equipment operator when
a pedestrian or object is too close,
slowing the vehicle or bringing it to a
halt, prior to impact.
This is world-first technology and
reflects our commitment to improving
the safety of pedestrians in all
organisations wherever there is a
risk of vehicle to person incidents.
Over the last six months, in particular,
we have been working with our
technology partners to bring reality to
life including testing the technology at
Barminco’s head office in Hazelmere.
Sensing equipment has been fitted to
a LH517i loader and functionality has
been refined to fully meet Barminco’s
operating requirements. This will
ensure our system will meet safety
requirements without negatively
impacting productivity or operator
experience.
Results to date have been very positive,
with additional work underway to
ensure optimum performance in
a fully operational environment.
PERENTI – SUSTAINABILITY REPORT 2022ABN 95 009 211 474 HEALTH
Perenti is committed to protecting the
health and wellbeing of our employees
and contractors. We set clear mandatory
minimum standards to identify and
assess health risks, manage their impact
and monitor the health of our people.
Our Health and Hygiene Standard
defines the minimum requirements
to effectively manage occupational
exposure risk, occupational diseases,
occupational injuries, and overall well-
being and mental health. This includes
identifying and controlling potential
sources of exposure to hazardous
substances, pathogens, dust, vapours,
noise, vibration and other hazards that
may result in occupational illnesses. We
also ensure that in the event any of our
people are injured or suffer ill health as a
result of their work, we provide the best
possible rehabilitation opportunities to
ensure people can achieve the earliest
safe return to work and reintegrate
following a workplace injury or illness.
Where there is a risk of exposure, health
surveillance activities including fitness
assessments, hearing and blood tests are
undertaken to ensure early detection and
improvements to controls are identified
and implemented.
The introduction of the new Perenti
HSE information system has enabled
improved visibility and understanding
of the effectiveness of controls in place
to safeguard the occupational health
of our employees. Reporting processes
were configured during FY22 and further
improvements to the utilisation of data
to improve health will occur throughout
FY23.
MENTAL HEALTH AND WELLBEING
Good mental health and wellbeing is a
fundamental part of our safety culture.
In January 2022, we introduced
our health, safety and well-being
e-magazine, Core, with the aim of
improving awareness of mental and
physical health and wellbeing. Our
ultimate objective is to improve the
physical and mental wellbeing of our
people and encourage them to support
and look out for one another.
To support the proactive management
of mental health and wellbeing, and to
provide our employees with tools and
skills to build resilience and positive
mental health, we continue to promote
the Employee Assistance Programme
(EAP), a free, voluntary and confidential
health program available 24/7 to all
Perenti employees and their immediate
families.
SMARTER TOGETHER - SAFET Y & HE ALTH
• Visits by psychologists to some of our
locations to engage directly with our
people about mental health,
•
In support of Beyond Blue, our
team at Ausdrill painted a Rock
Commander blue with a prominent
slogan “Reach out and start the chat”.
The blue Rock Commander is a visual
reminder for all our people that it’s ok
to stop, take the time to have a chat
and that there is always someone
willing to talk, listen and help.
The EAP aims to foster a shared
understanding of mental health care in
our workplace and provides employees
with easy access to professional
assistance for resolving personal and
work-related issues which may affect
their work or quality of life.
Perenti continues to support Australian
and global mental health campaigns,
including World Mental Health Day and
R U OK? Day. Activities throughout the
organisation included:
• Focused discussions by subject
experts on topics associated with
mental health,
CASE
STUDY
POSITIVE STEPS
TOWARDS BETTER
MENTAL HEALTH
Mental illness can affect anyone,
of any age or background. In 2020,
across Australia 3,139 people
died from suicide. In addition,
approximately one in five people
suffer from some form of mental
illness.
With more than nine-thousand
employees across Perenti and our
businesses, the workforce is a direct
reflection of society. Recognising the
rise in need for mental health support
and to eradicate stigma associated
with mental health.
FY22 saw BTP introduce a series of
programs to improve mental health
and wellbeing, strengthening an
environment where people want to
come to work, are safe to speak up
if they’re struggling and have support
mechanisms in place to be able to
recognise and help those affected.
80 BTP employees participated in a
General Awareness Mental Health
and Wellbeing training course during
the reporting period to improve
mental health and suicide prevention
understanding.
Another area of action saw front-line
Managers and Supervisors participate
in specialised EAP training. The
Manager Assistance Program worked
to increase their understanding of the
value of EAP to ensure they know the
services on offer and can speak with
advice and guidance when liaising
with employees about mental health
options.
BTP rounded out FY22 by becoming
a signatory to the Life in Mind
Communications Charter. As part
of this charter, BTP has pledged its
support toward a unified approach to
mental health and suicide prevention.
45
PERENTI – ANNUAL REPORT 2022 SMARTER TOGETHER - SAFET Y & HE ALTH
COVID-19
The ongoing global threat of COVID-19 continued to impact
our people and the business throughout FY22. While specific
aspects of our response varied by country, a major part of
our work in this area was dedicated to testing and vaccination
support. Perenti recognises the importance of vaccinations in
playing a pivotal role in assisting the global fight against this
virus. Accordingly, we placed a significant focus on vaccinations
and testing as the best proven means at our disposal of
preventing the spread of COVID-19 and worked with clients
and partners in government around the world to strengthen the
capacity to vaccinate our workers and contractors. We continue
to track and monitor the pandemic closely through our risk
management processes.
At our project sites, we continued to apply prevention activities
which included limiting the size of toolbox and pre-start
meetings to achieve social distancing, increased hygiene and
cleaning practices, split rosters, and staggered meal breaks and
start and finish times where possible.
Across Perenti there were 1,251 confirmed positive cases of
COVID-19 in FY22. Fortunately, the majority of cases have had
a limited direct impact on the health and well-being of our
people. The positive cases detected largely reflect the rigor of
applying testing protocols prior to workers travelling to site or in
screening on arrival prior to entering the workplace.
46
OCCUPATIONAL HYGIENE MONITORING
In FY22, we continued with our hygiene-sampling activities
to gather data on workplace exposures to evaluate health
risks to our people and provide assurance of control
effectiveness. Perenti’s health and hygiene commitment
includes identifying and controlling potential sources of
exposure to hazardous substances, dust, vapours, noise,
vibration and other hazards that may result in occupational
illnesses. The most prevalent occupational hygiene hazards
that occur throughout the Group include excessive noise,
airborne contaminants (welding fumes, respirable dust and
crystalline silica) and volatile organic compounds.
In addition to occupational hygiene monitoring conducted
with our people as part of our clients’ on-site programs,
during the reporting period 152 individual monitoring
activities were undertaken across 16 similar exposure
groups at our BTP, Ausdrill, Barminco and MinAnalytical
(prior to its divestment) operated facilities. This important
work is evident in subsequent improvements to equipment
and facilities to minimise occupational health exposures.
An example of a key improvement delivered during the year
was installing Local Exhaust Ventilation (LEV) systems at our
MinAnalytical facility and improvements to the LEV system
at BTP to reduce worker exposure to airborne contaminants
in the workplace by capturing the emission at source
and transporting it to a safe emission point or to a filter/
scrubber.
PERENTI – SUSTAINABILITY REPORT 2022ABN 95 009 211 474 SMARTER TOGETHER - OUR PEOPLE
SMARTER TOGETHER
OUR PEOPLE
OUR COMMITMENTS
Perenti made the following FY22 commitments:
FY22 commitment
Status
Reference
In FY23 we will:
Roll out a bespoke leadership development
program across the Group.
Leadership and capability
development, page 47
Conduct a self-assessment of a sample of
our sites to identify opportunities to make
them more amenable to all genders.
Define the key cultural priorities to action
and commence embedding these as
needed across the business.
As part of the annual remuneration review
cycle, implement leader training for the
annual gender pay gap review and provide
detailed reporting to monitor progress from
the newly implemented HR system.
Inclusion and diversity,
page 47
Inclusion and diversity,
page 47
Remuneration, page 48
Implement and embed a new
operating model and ways of
working.
Obtain Board review an
endorsement of the Its Not OK
(Elimination of Harmful Behaviours)
assessment report and associated
enterprise-wide action plan.
Join the 40:40 Vision and set
gender equity targets in line with
a commitment to attain 40:40:20
gender balance in Board and
executive leadership roles by 2030.
Undertake a detailed gender pay
gap review for wage employees
(operators and maintainers) and
deliver identified actions.
INCLUSION AND DIVERSIT Y
Perenti recognises the value of an inclusive and diverse
workforce. Our local participation in the international
workforce remains high at 89.4%, an increase on FY21.
Our percentage of females in senior management (18.8%)
has increased by 7.7% since 2019. Female employees in the
workforce have also increased over this same period from
7.4% in FY19 to 10.6% in FY22.
As part of our commitment to inclusion and diversity in FY22,
the following measures were taken:
• Culture and Inclusion Steering Group formed to provide
guidance on the implementation of the Inclusion and
Diversity Strategy;
•
Implementation of the Inclusion and Diversity Strategy;
• Commenced the development of a group-wide Indigenous
Engagement Strategy. A yarning circle was held with the
Indigenous Desert Alliance to help inform the approach;
• Understanding unconscious bias session and subsequent
development pathway undertaken by Group Executive and
made available to their leadership teams;
• Self-assessments to identify opportunities to make our
sites more amenable to all genders and cultural needs
were undertaken at our Mining Services Division and in
partnership with our clients at a sample of our Contract
Mining sites. Opportunities identified included improved
female ablution facilities and uniforms. Further self-
assessment planning in progress across the business to
ensure continuous improvement in FY23;
• Development of the It’s Not OK campaign and body of
work across our business, including conducting a survey
and focus groups on the experience of our workforce with
respect to sexual assault, sexual harassment and other
harmful behaviours; and
• Leading@Perenti pilot program has been undertaken
with the Group Executive and select senior leaders with
a diagnostic designed around the cultural attributes of
leadership, the climate leaders create and work on leading
diversity, inclusion and belonging.
LEADERSHIP AND CAPABILIT Y DEVELOPMENT
In FY22, we progressed the full design and development of
the Leading@Perenti Program. The intention of this program
is to enhance the capability of our leaders across the
business. It aligns to the behavioural expectations articulated
in the Perenti principles and our revised business strategy
and operating model. The roll out of Leading@Perenti will
commence in FY23.
Our It’s Not OK campaign is focused on eliminating sexual
assault, sexual harassment and other harmful behaviours.
The program outlines acceptable behaviours, expectations of
leaders and the cultural attributes that ensure a psychologically
safe work environment for our people.
Thinking Differently About Safety (behavioural based safety
leadership program) has been rolled out across our Australian
Operations in FY22. This program is being undertaken with
leadership across our business. This is focused on further
understanding the work of leaders, the culture they create and
linkages to behaviours and safety outcomes.
47
PERENTI – ANNUAL REPORT 2022
SMARTER TOGETHER - OUR PEOPLE
REMUNER ATION
L ABOUR REL ATIONS AND MANAGEMENT
In FY22, Perenti’s People and Remuneration Committee
undertook an external incentive plan review to ensure
continued alignment of our Remuneration Framework
with delivery of the company strategy and ensuring market
competitive remuneration. The outcomes of this review will
continue to be implemented throughout FY23.
Perenti is committed to ensuring all employees and contractors
are treated in a fair, equitable and ethical manner. Across our
varied employment jurisdictions, we work closely with the
relevant governments, union representatives and employee
groups to ensure adherence and compliance to the required
labour laws, HR regulations and labour rights policies.
As part of the 2021 salaried remuneration review cycle, we
implemented unconscious bias leader training to support our
gender pay gap review, with 80 leaders completing the training.
Our focus on ensuring gender pay equity will continue to be
incorporated into our review processes.
Perenti continued to experience challenges to attract and
retain employees in a tight labour market. Whilst we support
a sustainable 'pay for performance' philosophy, Perenti
undertook a comprehensive review of various mechanisms,
such as retention programs, to ensure we attract and retain
core high performing talent.
We expect similar labour pressures will continue into FY23 and
we will continue to monitor and respond accordingly to ensure
seamless project and service delivery for our clients.
HR SYSTEM
In FY22, we continued to improve on our new company-wide
HR information system with the implementation of recruitment
and onboarding modules. Our investment in people related
systems has enabled improved leader and employee
experience in HR processes as well as greater visibility of HR
data and faster, more meaningful decision making regarding
our people.
In addition to maintaining the required minimum labour
regulations across the Group, we hold ourselves to a high
standard of business policies related to Code of Conduct,
Anti-bribery and Anti-corruption and Speak Up. These
policies ensure all employees and contractors are aware of,
and adhere to, practices that are ethical, fair and help create
an environment free from harassment, discrimination, or
victimisation.
Perenti is proud of its reputation and processes on workplace
relations matters, evidenced by the lack of industrial disputes
across the varied employment jurisdictions. Should any
company be subject to labour controversy, based on the nature
of the interaction and/or union agreement, these are managed
by our experienced Operations Managers, supported by the
local Human Resources team, who are well versed in the
relevant laws and regulations of the host country and where
necessary, our internal legal advisors.
ELIMINATION OF
SEXUAL ASSAULT,
SEXUAL HARASSMENT
In late 2021, Perenti commenced
a program of work dedicated to
eliminating harmful behaviours,
including sexual harassment, from
our workplace. As part of this
program, the It’s Not OK campaign
was launched. This program reflects
Perenti’s strong commitment to a
safe and respectful workplace as well
as reinforcing our support for the
mining industry’s collective response
to eliminate sexual harassment and
other harmful behaviours. To that
end, we have signed up to the Mineral
Council of Australia’s commitment
to eliminate sexual harassment and
are active in the Chamber of Minerals
and Energy working group, Safe and
Respectful Behaviours.
We conducted a survey and
focus groups across our Australian
businesses, which aimed to
understand the experience of
our people.
The response rate to our survey was
positive with more than 30% of our
Australian workforce participating in
the survey.
In parallel to this survey, leader
readiness sessions have been
developed to ensure leaders are
equipped to lead in a manner that
promotes psychological safety in
our workplaces, and have the ability
to have difficult conversations, and
provide feedback and coaching to
their people.
Importantly the feedback from our
workforce has indicated that they
are proud to work for a company
that encourages and is open to
honest conversations. We also
received feedback on where there
are challenging situations and where
we can improve. We are committed
to continue this conversation into the
future.
48
PERENTI – SUSTAINABILITY REPORT 2022ABN 95 009 211 474 WALK IN THEIR SHOES - COMMUNIT Y
WALK IN THEIR SHOES
COMMUNITY
OUR COMMITMENTS
In FY23 we will:
Perenti works to build respectful relationships with
communities and maintain broad support for our operations.
We do this by supporting local initiatives, providing stable
local employment and local procurement opportunities, and
minimising project-related impacts to nearby populations.
Perenti contributes to national economies through payments
in taxes and royalties and by procuring goods and services
from the host country.
Develop social performance standard.
Develop group wide formal community
grievance procedure.
Develop a revised Indigenous
Engagement Strategy.
OUR LOCAL COMMUNITIES
Perenti is committed to establishing open and trusting
relationships with the communities across the countries we
operate within. Central to building relationships are Perenti’s
community investment programs, which aim to achieve broad
and sustained positive impact within the community. In FY22
Perenti provided a total contribution of $368,601 to local,
regional and national programs supporting positive social
outcomes. Examples of the community programs and initiatives
Perenti supported in FY22 include:
• donating new solar panels and batteries to the Pahin Public
Primary School, just five kilometres from our Yaramoko
operation in Burkino Faso. The project has improved the
lighting in classrooms and provided a renewable energy
source for the school;
• continuing our long-standing relationship with the University
of Mines and Technology, Tarkwa, by donating ten high
speed computers, with dedicated graphic cards and 24-inch
monitors; and
• sponsoring six local indigenous girls and be a platinum
sponsor for the 2022 Camp Engies, in Ontario Canada.
Camp Engies is a two-day, one-night retreat aimed at
attracting girls in grades 6 through 8 to study engineering.
Local Procurement
Perenti strives to purchase local goods and services to
support local businesses. In FY22, Perenti procured $1.5 billion
worth of goods and services from local businesses, including
$834 million from business in Australia, $603 million from
businesses in Africa, and $38 million from businesses in North
America. Factors such as new projects in North America and
Africa have resulted in an increase in local procurement spend
in FY22.
Local Employment and Training
Mining projects create a significant number of high-quality
employment opportunities and have the capacity to generate
social and economic value for local and regional communities.
Perenti actively encourages local workers to apply for positions
and aims to prioritise local applicants where possible. At
the end of FY22, 89% of our workforce outside of Australia
comprised of local employees with a further 2% coming from
within the region.
We are also committed to train local people to support the
development of their careers as well as to build the local
capacity to capitalise on opportunities within the industry.
In 2019, when awarded the contract in Botswana at the
Zone 5 Project, we committed to investing in local communities
through the employment and upskilling of local people. Our
state-of-the-art training centre in Botswana was purpose-built
to train employees in all the core competencies required in
the mining induction process. Recruits were attracted by job
advertisements placed in surrounding village meeting places
as part of our Local Locals Employees program. The successful
recruitment program has led to the transfer of world-class
knowledge and exposure to leading technology programs. The
training centre, which is now also being used to train people for
the Motheo Project in Botswana, is helping build capability in
the national workforce and is an example of our commitment
to train local people and Enable tomorrow for the communities
we operate in. Some key achievements in FY22 include:
•
trained 49 tradespeople in hand and power tools and
57 tradespeople in hydraulics and pneumatics at the
Engineering School;
• 186 employees completed the cultural awareness training;
and
• 186 employees completed induction training.
Perenti’s training centre in Botswana and our commitment to
support and develop African communities was recognised in
FY22 by the Australia-Africa Minerals & Energy Group (AAMEG)
at the 2021 Africa Awards announced at the Africa Down Under
conference.
Indigenous Engagement
In recognition of the fact that mining often takes place on
indigenous land, Perenti is developing a group-wide Indigenous
Engagement Strategy. This strategy will further help guide
our approach to creating genuine, respectful, and productive
relationships with local groups.
Our entry into North America has seen us partner with First
Nations groups to ensure we maximise local participation and
we have recently formed a partnership with the Indigenous
Desert Alliance (IDA) in Australia to help shape our approach to
Indigenous engagement in the future.
49
PERENTI – ANNUAL REPORT 2022 WALK IN THEIR SHOES - COMMUNIT Y
CLONTARF
Barminco has partnered with the
Clontarf Foundation since 2010 and is
committed to the continued support of
this program, participating in a range
of activities to strengthen our ties as a
partner.
As part of our NAIDOC Week
celebrations in FY22, Barminco hosted
an art challenge. The brief to students
was to demonstrate what it means to
them to “Walk in their Shoes”. This core
principle supports the commitment we
make to the communities we operate
in, and to listen, understand and respect
different points of view.
Barminco employees have also
supported a range of academies with
participation in employment forums,
dodgeball tournaments and Good
Bunch Lunches, even providing a joint
experience to the students at Kalgoorlie
to learn about Australia’s Birds of Prey.
We are committed to developing and
maintaining relationships of mutual
understanding and respect with local
Indigenous communities in whose
traditional lands the Company operates.
CASE
STUDY
CASE
STUDY
PERENTI
SUPPORTS
CoRE LEARNING
FOUNDATION
Perenti is proud to sponsor of the Centre of Resource
Excellence (CoRE) Learning Foundation for the first year.
The CoRE Learning Foundation works to inspire the next
generation through hands on STEM learning across its
11 schools in Western Australia’s Pilbara, Wheatbelt and
Goldfields regions. CoRE’s mission is to make learning real-
world by combining the sciences, technology, engineering,
arts and maths to develop novel solutions to real-world
problems.
Our sponsorship helped support nearly 1000 CoRE students
progress through the 2021 – 2022 program, an increase
of 60% from the previous year. The year saw the launch of
a new digital earth science learning tool for that provides
students with the choice of eight educational games. One
game allows students to digitally create a diorama describing
an archean deep sea environment, reflecting a Pilbara iron
ore formation.
50
PERENTI – SUSTAINABILITY REPORT 2022ABN 95 009 211 474 WALK IN THEIR SHOES - COMMUNIT Y
CASE
STUDY
IDA PARTNERSHIP
The Indigenous Desert Alliance (IDA) is an Indigenous
led not-for-profit organisation whose membership
is comprised of Indigenous land management
organisations working in the desert regions of Australia.
The IDA plays a vital role in ‘Keeping the Desert
Connected’ and building resilience for desert ranger
programs. It is focused on working with its members
and partners to ensure that Indigenous people are
enabled to collaboratively manage Australia’s desert
country and through this, to realise their social, cultural,
environmental and economic aspirations.
The partnership will enable Perenti to continue its
engagement with Indigenous communities, ensure the
IDA’s vital programs are supported and the importance
of the desert regions of Australia is acknowledged.
PERENTI – ANNUAL REPORT 2022
51
SUSTAINABILITY
REPORT
HEAD OFFICE
Level 2, 202 Pier Street, PERTH WA 6000 AUSTRALIA
+ 61 8 9421 6500
perentigroup.com
GOVERNANCE
AND RISK
CORPOR ATE GOVERNANCE
STRENGTHENING
GOVERNANCE AT
PERENTI
ORGANISATIONAL STRUCTURE MAP AND LINES OF RESPONSIBILIT Y AND ACCOUNTABILIT Y
BOARD
Accountability to shareholders for strategy, performance and governance
AUDIT & RISK
COMMITTEE
SUSTAINABILITY
COMMITTEE
BOARD
COMMITTEES
NOMINATIONS
COMMITTEE
PEOPLE &
REMUNERATION
COMMITTEE
MANAGING DIRECTOR & CEO
PERENTI GOVERNANCE FRAMEWORK (PGF)
GROUP EXECUTIVES
Internal Audit
Independent and objective
assurance and advice on
all matters related to the
achievement of objectives
PGF
Framework to create
and coordinate policies
and controls to manage
regulatory and internal
legal, risk and compliance
requirements
Divisions
Provision of services to
clients and managing
risk
Corporate
Expertise, support,
monitoring and
challenge on risk
related matters
KEY:
Delegation, direction,
resources, oversight
Accountability,
reporting
Alignment, communication,
coordination, collaboration
Independent
reporting line
E
X
T
E
R
N
A
L
A
S
S
U
R
A
N
C
E
P
R
O
V
I
D
E
R
S
GOVERNANCE & RISK
53
PERENTI – ANNUAL REPORT 2022
CORPOR ATE GOVERNANCE
GOVERNANCE
AND RISK
BOARD COMMIT TEES
SKILLS / COMPETENCY
The Board has established four committees that are
structured in accordance with the Corporate Governance
Principles and Recommendations 4th Edition of the ASX
Corporate Governance Council (ASX Recommendations)
and enable the Board to effectively discharge its
responsibilities. The committees review relevant
matters and make recommendations to the Board.
In line with the Company’s ongoing commitment
to best practice corporate governance, in January
2022 the Board approved the change in the
committee structures to establish the Sustainability
Committee and the Nomination Committee.
Each committee has a Charter that outlines the roles and
responsibilities of the committee, its members, meetings
and reporting requirements. All Charters were reviewed
and updated for best practice in FY22. Further information
about corporate governance as well as copies of the Board
and committee charters can be found in the corporate
governance section of the Company’s website
at perentigroup.com.
CORPOR ATE GOVERNANCE STATEMENT
The Company’s 2022 Corporate Governance Statement
outlines the Company’s current corporate governance
framework, by reference to the ASX Recommendations.
The Corporate Governance Statement is current as at
22 August 2022 and has been approved by the Board.
The statement can be found in the corporate governance
section of the Company’s website at perentigroup.com.
The related ASX Appendix 4G, a checklist cross-referencing
the ASX Recommendations to disclosures in the Corporate
Governance Statement and the 2022 Annual Report can
be found under the ASX Announcements section of the
Company’s website at perentigroup.com.
BOARD SKILLS MATRIX
In FY22, an external review was conducted of the board skills
as part of the annual Board evaluation process to identify the
key skill areas for the Board to discharge its responsibilities
in accordance with the highest standards of governance
and to execute the Company’s 2025 Strategy. The results
of this review were evaluated to ascertain whether there
were any skill gaps that would need to be addressed
through succession planning and/or director professional
development program. The combination of skills and
experience were chosen to align with the Company’s 2025
Strategy as well as the Company’s current and emerging
risks, opportunities, challenges and developments. The
Company’s board skills matrix shows the extent of the
knowledge and experience of the directors in each area,
taking into consideration their years of direct experience.
Leadership
Strategy
Industry specific experience
Capital management
Legal and regulatory compliance
Corporate governance
Financial acumen
Health, safety and environment
People and culture
Digital, data and technology
Risk management
ESG
1
2
3
4
5
6
7
Expert – Deep knowledge / formal qualification or
experience over many years
Moderate – Moderate skills / experience – knowledgeable
but not highly skilled
Aware – Some knowledge and can follow a discussion
54 GOVERNANCE & RISK
ABN 95 009 211 474
CORPOR ATE GOVERNANCE
MEMBERSHIP
ROLE
KEY RESPONSIBILITIES
Audit and Risk Committee
Andrea Hall (Chair)
Robert Cole
Timothy Longstaff
To assist the Board in
fulfilling its oversight
responsibilities in
relation to the integrity
of the Company’s
financial reporting, the
effectiveness of the
Company’s systems of
risk management and
controls, the Company’s
legal and regulatory
compliance and internal
and external audit.
The responsibilities of the committee are to monitor, review and, where appropriate,
make recommendations to the Board on the following matters:
• Relevant changes in legislation and corporate governance in relation to financial
and risk reporting
• Material accounting policies and practices and the adequacy of the Company’s
financial controls
• Adequacy of and compliance with the Company’s risk management framework
and policy and the material emerging business risks
• Procedures for the appointment, dismissal and rotation of the external auditor,
independence and performance of the external auditor, external audit reports
and annual audit plan and work program
• Performance of internal audit function, the internal audit plan and work program
and internal audit reports and recommendations
• The Company’s tax risk governance framework and tax reporting
• Assessment of processes to ensure compliance with legal and regulatory
requirements
• Reviewing the half and full year financial statements and the integrity of periodic
corporate reports released to the market
• Any material reports received through Speak Up or breaches of the Company’s
Anti-Bribery and Corruption Policy.
Nomination Committee
Robert Cole (Chair)
All Non-executive directors
To assist the Board in
fulfilling its oversight
responsibilities
in relation to the
Board’s composition,
performance, and
succession planning.
The responsibilities of the committee are to monitor, review and make
recommendations to the Board on the following matters:
• Criteria for appointment of new directors
• The composition of the Board and committees
• Director induction program
• Board performance evaluation
• Board skills matrix
• Board succession planning
• Director professional development program
• Director independence and associated disclosures.
People and Remuneration Committee
Mark Hine (Chair)
Andrea Hall
Robert Cole
Sustainability Committee
Timothy Longstaff (Chair)
Alexandra Atkins
Mark Hine
Robert Cole
To assist the Board in
fulfilling its oversight
responsibilities in
relation to people and
remuneration and
ensuring the Company’s
has a remuneration
framework and policies
to attract, reward
and retain a diverse
workforce.
To assist the Board in
fulfilling its oversight
responsibilities in relation
to the Company’s
policies, practices and
governance in safety,
health, environment,
climate change,
communities and
human rights.
The responsibilities of the committee are to monitor, review and, where appropriate,
make recommendations to the Board, on the following matters:
• The Company’s inclusion and diversity strategy and policy
• The Company’s remuneration framework, policies and practices
• Chair, Non-executive director, MD & CEO and Group Executive remuneration
• MD & CEO and Group Executive succession planning
• Organisational culture
• Breaches of the Code of Conduct
• The Company’s incentive plans.
The responsibilities of the committee are to monitor, review and, where appropriate,
make recommendations to the Board, on the following matters:
• Sustainability policies and strategies
• Sustainability risk management
• Compliance with legal and regulatory obligations relating to sustainability
• The Company’s performance in relation to sustainability matters and
commitment
• Safety and safety investigations
• Relevant changes in legislation, corporate governance, standards or
expectations in relation to sustainability
• The Company’s sustainability reporting.
55
PERENTI – ANNUAL REPORT 2022 CORPOR ATE GOVERNANCE
GOVERNANCE
AND RISK
OUR RISK
MANAGEMENT
FRAMEWORK
During FY22, Perenti conducted a strategic update of its risk
management framework with an emphasis on optimising risk
culture and formalised integration into decision making. The
revised risk management framework sets out clear roles and
responsibilities with minimum performance requirements
applicable across the Group. Perenti relies on effective risk
management as a competitive advantage to adapt to a dynamic
mining industry within a complex external environment.
While we have controls in place to manage threats, we realise
the importance of making effective risk-reward decisions
based on relevant data and intelligence. Our framework is
designed around understanding and controlling those events
that can significantly impact our strategic and operating
objectives, ultimately decreasing the probability and impact
of threats while realising the benefit from opportunities where
practicable. We regularly review our enterprise risk suite,
including the impact, likelihood, critical control effectiveness
and committed actions to optimise our control profile and
inform our decision making. We also conduct strategic risk
assessments of our insurable risk profile to optimise our
risk mitigation and transfer in line with our risk appetite.
Perenti’s risk framework defines enterprise risks as those
risks that are significant at a Group level, based on materiality,
strategic time horizon and broader Group applicability.
Enterprise risks are managed by the Group Executive
Committee with effective oversight by the Board, and with
the Audit and Risk Committee of the Board monitoring the
overall effectiveness of our risk management framework.
Perenti has an effective crisis management program
which is regularly tested and exercised. This is
complemented by integrated business continuity
planning and a cyber incident response team to ensure
we are resilient in the face of cyber threats.
Enterprise risk management is a fundamental component
of the Perenti governance framework and enables effective
second and third line assurance to test the adequacy
and effectiveness of the internal control framework to
increase the likelihood of achieving business objectives.
EMERGING RISK
Geopolitical tensions, logistics constraints and supply / demand
imbalances continue to create challenges for globalised
markets and the impact to organisations will continue to be
felt. This complex landscape highlights the importance of
proportionate risk management, including detection and
investigation of emerging risks. Perenti proactively analyses
the impact of these risks to our key strategic and operational
objectives so we can react and respond effectively.
56 GOVERNANCE & RISK
Some emerging risk themes faced by Perenti are described
below:
Changing ESG expectations: There are varying frameworks,
principles and guidelines that exist which makes it challenging
for organisations to navigate the ever evolving and complex
ESG environment. The reporting landscape is beginning
to converge in terms of standards and disclosure, however
expectations from major stakeholders, including investors,
financial institutions and wider society continue to increase.
While these changing expectations are likely to impact the
mining industry, there remains opportunity for Perenti as we
monitor and actively adapt to the changing environment. We
continue to integrate sustainability into our decision-making,
business processes and operational practices.
Climate change and carbon emissions: The regulation (and
associated pricing) of greenhouse gasses is increasing globally.
As a result, there is a growing market pressure for companies
to disclose their measures for identifying and managing both
physical and transitional climate related risks. Perenti continues
to act to address climate change as we incorporate climate-
related considerations in our strategic planning, business
planning and decision-making.
Evolving mining services market: The rate of technological
improvements in the mining industry is increasing, as is the
potential for the introduction of new competing technologies
by direct and indirect competitors. Perenti has committed to
fund digital technology capability through investment in idoba,
which will allow us to stay ahead of technological advancement
in the mining industry to maintain our competitiveness while
remaining responsive to market demand.
Macroeconomic environment and commodity cycle:
A war in Europe and the supply-chain disruptions exacerbated
by shutdowns in China are significantly impacting global
economic conditions with the potential for a recession.
Changes to commodity prices may impact our client’s
capital investment or contracting strategy. Perenti maintains
a diverse portfolio of businesses across a range of markets
and geographies to mitigate macroeconomic uncertainty.
KEY ENTERPRISE RISKS
Perenti has a consistent, proactive approach to risk
management across operations globally aligned with ISO
31000, as well as the ASX Principles and Recommendations.
The Group’s commitment to strong governance extends
through to the approach taken to risk management
systems and controls and effective integration with our
internal audit function. Our enterprise risks are risks
which have been identified to have the potential to have
a material adverse impact on the financial condition
and results of operations and they are the risks that are
most relevant to existing and potential shareholders.
The key enterprise risks are set out below with an
overview of how we manage those risks. The risks are
not necessarily listed in order of importance and are
not intended as an exhaustive list of all the risks and
uncertainties associated with the Group’s business.
ABN 95 009 211 474 CORPOR ATE GOVERNANCE
RISK
MITIGATION
WINNING WORK AND MARKET RISK
It’s important that Perenti maintains its project pipeline to
balance our organic growth objectives. Perenti strives to
win and maintain quality projects underpinned by robust
financial and commercial disciplines to enable organic
growth objectives. However, there is inherent uncertainty
in how contract mining projects are priced given the risk
environment in which we operate. We also face disruption
due to the changing technology landscape and mining
service market.
PROJECT DELIVERY AND MARGINS
The Group’s activity levels and results are dependent on
production levels at clients’ mines while revenues are linked
to the production volumes and not to the short-term price of
the underlying commodity. Perenti is exposed to uncertainty
over the availability and cost of key resources, including
talent, assets and key supplies. Sub-optimal project execution
can put pressure on earnings, cashflow and ability to fund
growth. Contracts can be terminated for convenience by the
client at short notice and without penalty, although this is not
a common occurrence.
FINANCIAL RISK
Liquidity risk is the risk that Perenti will not be able to meet its
financial obligations as they fall due. This could be as a result
of counterparty risk, poor project performance and inability
to repatriate and recycle cash on a timely basis, amongst
other things.
Access to capital is a risk that could adversely impact the
Group’s ability to meet its growth ambitions and meet other
funding requirements as and when required.
The Group operates across a number of international
jurisdictions and has US dollar denominated debt through
its US144A notes and as result can have exposure to foreign
currency fluctuations, primarily in US dollars, Euros and West
African francs. The Group also has US dollar denominated
debt through its US144A notes and credit lines.
We balance risk and reward carefully with all projects and are selective in
the contracts that we enter to allow for options to extend where possible
to maximise the contract period and the return on capital. Utilisation
of our considerable body of knowledge together with the application
of our estimating and work procurement practices (including tenders)
and structured approval processes maximises the likelihood of securing
quality work with commensurate returns for the risks taken.
The Group maintains a work portfolio diversified by geography, market,
activity and client to mitigate the impact of emerging trends and
market volatility. We have historically had a strong record of completing
contracts to term and securing contract extensions.
There remains an opportunity to invest in technology capability to
expand and diversify mining services revenue sources.
The Group derives most revenues from mines which are already in
production. We have limited our exposure to the exploration activities
market which has been volatile and are focused on providing services to
large lower-cost producers who are not subject to the same production
risk as higher-cost operations. We are focused on ensuring execution
of work to a high standard and improving our operation to increase our
value proposition to clients. Rise and fall provisions exist in key contracts
to compensate Perenti for key project input cost movements.
Our approach to managing liquidity risk is addressed through active
treasury management, the scale of the business and the large number
of counter-parties and projects that contribute to the Group’s cash flows
so that we are not reliant on any one project, party, or jurisdiction. In
addition, we continuously monitor minimum liquidity level thresholds
through short, medium and long-term cash flow forecasting and through
active management of credit and equity funding lines. In addition, Perenti
has a comprehensive insurance program that provides protections
against key risks and loss of assets.
This risk is managed through a disciplined capital allocation process,
targeting and maintaining an appropriate balanced debt and equity
capital structure which includes access to a mix of credit lines with
different maturity dates. Interest rate risk is an outcome of the Group’s
overall capital structure and is actively reviewed and managed through
a mix of fixed and variable sources of funding and capital allocation to
prudently manage this exposure.
The Group aims to ensure that the net balance sheet exposure is kept to
an acceptable level by matching foreign denominated financial assets
with matching financial liabilities, natural cashflow hedges with certain
cash inflows and outflows denominated in the same currency and is
further supported by flexible credit lines which can be drawn in Australian
and US dollars. The Group may hedge material foreign exchange
exposures for firm commitments relating to sales or purchases or when
highly probable forecast transactions have been identified.
57
PERENTI – ANNUAL REPORT 2022 CORPOR ATE GOVERNANCE
GOVERNANCE
AND RISK
RISK
MITIGATION
SOVEREIGN AND SECURIT Y RISKS IN SOME JURISDICTIONS WE OPER ATE IN
Some of the jurisdictions within which the Group operates
are subject to sovereign and security risks. Changes in
Government, regulation and tax in overseas jurisdictions
has the potential to impact our performance.
Board approval is required to enter a new jurisdiction. The Group ensures
that it has a comprehensive understanding of the overseas jurisdiction
before entering it. Management monitors our current and potential
geographies, industries, activities and competitors on an ongoing basis.
We employ internal security expertise to manage the Group’s security
framework. There is ongoing communication with the businesses and
reporting on operations and developments in all jurisdictions in which we
operate. The Group also limits its risks contractually by only accepting a
manageable risk profile within the terms and conditions of our contracts.
L ABOUR COSTS AND AVAIL ABILIT Y OF SKILLED PEOPLE
The Group is exposed to increased labour costs in markets
where the demand for labour is strong. Changes to labour
laws and regulations may limit productivity and increase
costs of labour. If implemented and enforced, these types
of changes to labour laws and regulations could adversely
impact revenues and, if costs increase or productivity
declines, operating margins. Perenti could also lose key
executives, senior management or key operational personnel.
The Group’s labour costs are typically protected by rise and fall
mechanisms within client contracts, which mitigate the impact of rising
labour costs. In Australia, wage labour costs are typically governed by
agreed enterprise agreements, which set out agreed wage increases
within defined periods of time. We have an apprenticeship program that
focuses on training and development of our employees. We utilise a
comprehensive Group-wide framework to conduct reward/remuneration
and succession planning which includes talent development as well as
bi-annual salary benchmarking.
HEALTH AND SAFET Y
It is possible that the Group may experience incidents,
including life-changing events which have the potential to
cause physical or psychological harm. Perenti is committed
to providing a systematic process to manage these hazards.
Governance of health and safety is overseen by the Sustainability Board
Committee. The Group has established a HSE management system
consistent with international standards to manage health and safety
risks. Key aspects include:
•
Integration of psychosocial hazards into operational risk
management practices
• Provision of appropriate training, supervision and resources
• Critical Risk Standards and verification processes provide the
framework for managing serious injury and fatality risk
• Leadership training and development to support a mature culture
which includes specific programs in relation to safety, and with
particular respect to sexual assault, sexual harassment and other
harmful behaviours
• Regular review and audit of HSE processes and controls
• Monitoring of periodic HSE reporting and Significant Potential
Incidents (SPI) at Group level.
CYBER SECURIT Y AND DATA PROTECTION
The growing volume and complexity of cyber-attacks is
increasing the risk to Perenti’s network.
The Group continues to invest in systems and infrastructure to protect
our assets. This includes:
•
Information security management systems (ISMS)
• Segregation and segmentation of networks
• Anti-malware / endpoint detection and response detection software
• Multi-factor authentication (MFA)
• Security education and awareness materials
• Penetration testing and supporting independent assurance of our
control framework
• Ensuring business resilience plannings for cyber related scenarios.
Perenti is committed to the highest standard of ethical conduct and
regulatory compliance. Management authority is effectively delegated
through risk-based delegation of authorities; appropriate segregation
of duties are in place and compliance risks are a key part of Perenti’s
broader risk framework. Group level policies and standards, including
our Code of Conduct set out the standards of behaviour expected of
our directors, employees, consultants, contractors and suppliers and
are supported by robust first, second and third line assurance.
FR AUD, BRIBERY AND CORRUPTION
Perenti is exposed to fraud, bribery and corruption risk in
some jurisdictions which could result in fines, reputational
impacts and the loss of growth opportunities. Perenti’s
reputation is critical to allow us to deliver on our strategy.
58
GOVERNANCE & RISK
ABN 95 009 211 474 FINANCIAL
REPORT
20
22
ABN 95 009 211 474
Creating enduring
value and certainty
CORPORATE
DIRECTORY
DIRECTORS
Robert Cole - Chair
Mark Norwell - Managing Director & Chief Executive Officer
Mark Hine - Non-executive Director
Alexandra Atkins - Non-executive Director
Andrea Hall - Non-executive Director
Timothy Longstaff - Non-executive Director
Craig Laslett - Non-executive Director
SECRETARIES
Rajiv Ratneser
Justine Passaportis
CHIEF FINANCIAL OFFICER
Peter Bryant
PRINCIPAL REGISTERED OFFICE IN AUSTR ALIA
Level 2, 202 Pier Street
Perth Western Australia 6000
SHARE REGISTER
Link Market Services Limited
Level 12, QV1 Building, 250 St Georges Terrace
Perth Western Australia 6000
AUDITOR
PwC
Level 15, 125 St Georges Terrace
Perth Western Australia 6000
SOLICITORS
Johnson Winter & Slattery
Level 4, 167 St Georges Terrace
Perth Western Australia 6000
STOCK EXCHANGE LISTINGS
Perenti Global Limited shares are listed on the
Australian Stock Exchange. ASX CODE: PRN
Perenti Global Limited’s subsidiary USD notes are listed on
the Singapore Exchange (SGX).
WEBSITE
perentigroup.com
60
FINANCIAL REPORT
ABN 95 009 211 474
DIRECTORS’ REPORT FINANCIAL
REPORT
20
22
Directors’ Report
Auditor’s Independence Declaration
Corporate Governance Statement
FINANCIAL STATEMENTS
Consolidated statement of profit or loss
Consolidated statement of comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the consolidated financial statements
Directors’ declaration
Independent auditor’s report to the members
Shareholder information
62
88
89
90
91
92
93
94
95
152
153
161
ABOUT THIS REPORT
These financial statements are consolidated financial
statements for the Group consisting of Perenti Global Limited
and its subsidiaries. A list of major subsidiaries is included in
note 14.
• The financial statements are presented in Australian
currency, Australian Dollars.
• The financial statements were authorised for issue by the
directors on 22 August 2022. The directors have the power
to amend and reissue the financial statements.
• All press releases, financial reports and other information are
available on our website: perentigroup.com
61
PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT
Your directors present their report on the consolidated entity (the “Group”) consisting of Perenti Global Limited (the “Company”)
and the entities it controlled at the end of, or during, the year ended 30 June 2022.
DIRECTORS AND COMPANY SECRETARY
The following persons were directors of the Company during the financial year and up to the date of this report (unless indicated
otherwise):
• Robert Cole (Chair)
• Mark Norwell (Managing Director & Chief Executive Officer)
• Mark Hine
• Alexandra Atkins
• Andrea Hall
• Timothy Longstaff (appointed 16 August 2021)
• Craig Laslett (appointed 28 February 2022)
Rajiv Ratneser and Justine Passaportis are the Joint Company Secretaries.
Mr Ratneser BCom, LLB, is the Chief Legal & Risk Officer and Joint Company Secretary. Mr Ratneser is a senior executive and
qualified lawyer with more than 20 years’ national and international experience across legal, commercial, governance and risk.
Mr Ratneser has served in senior leadership and executive roles for a variety of businesses and his experience spans Australia, Africa,
Asia, UK and North America.
Ms Passaportis BCom, LLB is Senior Legal Counsel and Joint Company Secretary. Prior to joining the Company, Ms Passaportis was
a Senior Associate at the global law firm, Clifford Chance, and prior to that at Clayton Utz. Ms Passaportis has held other various
positions as an in-house legal counsel.
DIVIDENDS - PERENTI GLOBAL LIMITED
The following table outlines dividends paid/payable to members during the financial year. On 22 August 2022, the directors
determined that no final ordinary dividend for the year ended 30 June 2022 (2021: 2.0 cents) be declared in line with the Group’s
Capital Management Policy.
Prior year unfranked dividend of 2.0 cents per ordinary share paid 20 October 2021
(2020: 3.5 cents paid 3 November 2020).
No interim dividends were determined for the year ended 30 June 2022 (2021:
unfranked interim dividend of 3.5 cents per ordinary share paid 7 April 2021).
22
$’000
21
$’000
14,108
24,563
-
14,108
24,707
49,270
The Company’s Dividend Reinvestment Plan (DRP) was suspended with effect from 16 March 2021 until further notice.
PRINCIPAL ACTIVITIES AND REVIEW OF OPER ATIONS
The principal activities for the Group during the year were the provision of contract mining - for surface and underground mining,
mining services and idoba. Additional information on the principal activities, operations and financial position of the Group and its
business strategies and prospects is set out in the operating and financial review on pages 2 to 28 of this annual report.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
There were no significant changes in the state of affairs of the consolidated entity during the financial year ended 30 June 2022.
62
FINANCIAL REPORTABN 95 009 211 474 DIRECTORS’ REPORT
EVENTS SINCE THE END OF THE FINANCIAL YE AR
On 18 July 2022, the Group announced it has entered into a settlement agreement to recover $10 million related to historical
damages caused to a property in West Africa. The settlement amount is before fees and taxes and will have a positive impact to
FY23 statutory earnings.
On 22 August 2022, the Group announced it executed a Share Sale Agreement for the sale of 10% of the issued shares in
idoba Pty Ltd to the Sumitomo Corporation for a total cash consideration of $5.4 million.
There are no other matters or circumstances that have arisen since the end of the financial year which significantly affected or may
significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in subsequent
financial years.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPER ATIONS
Additional comments on expected results of certain operations of the Group are included in this Annual Report in the operating
and financial review on pages 2 to 28.
ENVIRONMENTAL REGUL ATIONS
The Group is subject to environmental regulations and complies to these regulations at its owned and operated facilities
(for example our workshops). Our clients have obligations under environmental regulations and the Group complies with its
contractual obligations in this regard. The Group is committed to reducing the impact of its operations on the environment
and meeting its environmental regulations and contractual obligations.
63
PERENTI – ANNUAL REPORT 2022 INFORMATION ON DIRECTORS
The following information is current as at the date of this report.
Robert Cole
BSc, LLB (Hons)
Non-executive director and Chair
Experience and expertise
Mark Norwell
BE(Hons), MBA, MAICD
Managing Director & Chief Executive Officer
Experience and expertise
Rob Cole was appointed as a non-executive director on
14 July 2018 and was appointed as Chair on 8 May 2021.
Mark Norwell was appointed as Managing Director &
Chief Executive Officer on 17 September 2018.
Mr Cole has over 35 years experience in the energy and
resources industry. He was a former Executive Director on the
board of Woodside Petroleum Limited and a former Managing
Director of Beach Energy Limited. He was also a former Chair
of the Australian Petroleum Production and Exploration
Association. Prior to joining the oil and gas industry, Mr Cole
was a partner in the law firm now known as King & Wood
Mallesons.
Mr Cole is currently Chair of Illuka Resources Ltd, Chair of
Synergy, Chair of the Western Australian Land Information
Authority (Landgate) and a member of the Council of Curtin
University.
Mr Cole holds Bachelor of Science and Bachelor of Laws
degrees from the Australian National University in Canberra and
is also a graduate of the Harvard Business School Advanced
Management Program.
Other current directorships of listed companies
Non-executive director of Iluka Resources Ltd since March 2018
and Chair since April 2022
Former directorships in last 3 years
None
Special responsibilities
Chair of the Board
Mr Norwell is a highly experienced mining services executive.
Prior to joining Perenti, he was the Executive General Manager,
Strategy & Growth at Thiess Pty Ltd, and a member of Thiess’
executive leadership team. Over a 20-year career in the
mining services sector he has held senior roles with Leighton
Contractors, HWE Mining and Macmahon Holdings.
Mr Norwell holds a Bachelor of Civil Engineering (Hons) degree
from the University of Western Australia and an Executive MBA
from the University of New South Wales. He is also a member
of the Australian Institute of Company Directors.
Other current directorships of listed companies
None
Former directorships in last 3 years
None
Special responsibilities
Managing Director & Chief Executive Officer
Interests in shares and options
528,956 ordinary shares
1,419,409 LTI rights over ordinary shares issued
271,246 STI rights over ordinary shares issued
Member of the People and Remuneration Committee
Member of the Audit and Risk Committee
Member of the Sustainability Committee since 1 January 2022
Chair of the Nomination Committee since 1 January 2022
1,969,831 LTI rights over ordinary shares are awaiting grant
at Perenti’s Annual General Meeting if approved by the
Shareholders
Up to a maximum of 515,961 STI rights over ordinary shares
granted, not yet issued at 30 June 2022
Interests in shares and options
249,831 ordinary shares
64
FINANCIAL REPORTABN 95 009 211 474DIRECTORS’ REPORT INFORMATION ON DIRECTORS (CONTINUED)
Mark Hine
MAICD, MAusIMM
Non-executive director
Experience and expertise
Mark Hine was appointed as a non-executive director on
24 February 2015.
Mr Hine is a mining engineer. He graduated from the Western
Australia School of Mines and is a member of the Australian
Institute of Company Directors and the Australian Institute of
Mining and Metallurgy. He has extensive mining experience
with over 25 years of senior management roles in both surface
and underground mining operations.
Mr Hine previously held senior positions in the mining industry
as Chief Operating Officer at Griffin Mining Ltd, Chief Operating
Officer at Focus Minerals Ltd, Chief Operating Officer at
Golden West Resources Ltd, Executive General Manager
Mining at Macmahon Contractors Pty Ltd, Chief Executive
Officer at Queensland Industrial Minerals Ltd, General Manager
at Consolidated Rutile Ltd and General Manager Pasminco,
Broken Hill/Elura Mines.
Other current directorships of listed companies
None
Former directorships in last 3 years
None
Special responsibilities
Chair of the People and Remuneration Committee
Member of the Sustainability Committee since 1 January 2022
Member of the Nomination Committee since 1 January 2022
Interests in shares and options
145,000 ordinary shares
Alexandra Atkins
BE (Mineral Exploration & Mining Geology), Hon BE (Mining),
MBA (Finance), FIEAust, CPEng, EngExec, NER, APEC Engineer
IntPE(Aus), FAusIMM(CP), GAICD
Non-executive director
Experience and expertise
Alex Atkins was appointed as a non-executive director on
14 July 2018.
Ms Atkins is also a non-executive director of Strandline
Resources Limited, Aquirian Limited and a former director
of the Australasian Institute of Mining and Metallurgy and
International Women in Mining (London). She has over
25 years’ multi-disciplinary, multi-commodity experience
through the full mining value chain across Australia and
PNG in roles that find, design, run and regulate mines.
Ms Atkins’ mine operations roles include: Geologist for
Australian Consolidated Minerals; Mining Engineer for
Mt Isa Mines Ltd; Underground Miner/Airleg Miner for Plutonic
Resources; Underground Miner, Mining Engineer/Deputy Mine
Manager and Geotechnical Engineer for Placer Dome Asia
Pacific; and Mining Engineer for Murchison United.
Her career then pivoted to professional services and regulation,
including: Senior Mining Engineer for AMC Consultants;
District Inspector of Mines for the WA Department of Mines &
Petroleum; Principal Mining Consultant for Optiro & Alternate
Futures; Chief Advisor at Sustainability; Risk Manager at
Deloitte; COO at PETRA Data Science; and MD & Principal at
Alex Atkins & Associates, which is focused on conformance
and performance.
Ms Atkins holds two Bachelor of Engineering Degrees, from the
University of Queensland and WA School of Mines, qualifying
her as a Mining Engineer, Geotechnical Engineer and Geologist.
She holds First Class Mine Manager’s Certificates for Western
Australia and Queensland and has an MBA (Finance) from the
Australian Institute of Business. She is a Graduate Member
of the Australian Institute of Company Directors, Chartered
Professional Fellow of The AusIMM and Engineers Australia.
Other current directorships of listed companies
Non-executive director of Strandline Resources Limited since
May 2021
Non-executive director of Aquirian Limited since April 2021
Former directorships in last 3 years
None
Special responsibilities
Member of the People and Remuneration Committee until
1 January 2022
Member of the Sustainability Committee since 1 January 2022
Member of the Nomination Committee since 1 January 2022
Interests in shares and options
66,166 ordinary shares
65
PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT INFORMATION ON DIRECTORS (CONTINUED)
Andrea Hall
FCA, GAICD, BCom
Non-executive director
Experience and expertise
Andrea Hall was appointed as a non-executive director on 15
December 2019.
Ms Hall is a chartered accountant with more than 30 years’
experience in the financial services industry in roles involved
in internal audit, risk management, corporate and operational
governance, external audit, financial management and strategic
planning. She commenced her career at KPMG in 1987, before
retiring from the firm in 2012 as a Risk Consulting Partner where
she serviced industries including mining, mining services,
transport, healthcare, insurance, property and government.
Ms Hall is an experienced non-executive director and currently
serves as a non-executive director on the boards of several
listed and non-listed entities, including Evolution Mining, the
AFL Fremantle Dockers, Pioneer Credit, and the Insurance
Commission of Western Australia.
Ms Hall holds a Bachelor of Commerce degree from the
University of Western Australia and is also a Fellow of Chartered
Accountants Australia & New Zealand. She served on the WA
Council for Chartered Accountants Australia & New Zealand for
seven years until 2011, the last year as the Chair. She has also
completed a Masters in Applied Finance (Corporate Finance)
and is a graduate of the Australian Institute of Company
Directors.
Other current directorships of listed companies
Non-executive director of Evolution Mining Limited since
October 2017
Non-executive director of Pioneer Credit Limited since
November 2016
Former directorships in last 3 years
Non-executive director of Automotive Holdings Group Limited
from May 2018 to September 2019
Special responsibilities
Chair of the Audit and Risk Committee
Member of the People and Remuneration Committee
1 January 2022
Member of the Nomination Committee since 1 January 2022
Interests in ordinary shares
142,500 ordinary shares
Timothy Longstaff
BEc, FCA, GAICD, F FIN
Non-executive director
Experience and expertise
Tim Longstaff was appointed as a non-executive director
effective from 16 August 2021.
Through his career in Australia and overseas, Mr Longstaff
brings a depth of experience in finance, strategy formulation,
acquisitions and divestments, debt and equity capital markets,
and investor engagement amongst asset-intensive industrial
companies.
Mr Longstaff holds a Bachelor of Economics degree, is a Fellow
of the Institute of Chartered Accountants in Australia and New
Zealand, a Graduate of the Australian Institute of Company
Directors, and a Fellow of the Financial Services Institute of
Australia.
Mr Longstaff started his career in the audit division of Price
Waterhouse (now PricewaterhouseCoopers). He then had a 25-
year career in investment banking, with many years in Managing
Director and senior executive roles at top-tier global firms.
More recently, Mr Longstaff served as Senior Advisor to the
Federal Minister for Finance and Leader of the Government
in the Senate, and the Federal Minister for Trade, Tourism and
Investment. Through this experience, he brings valuable global
geo-political perspectives and insights into the workings of
Government.
Mr Longstaff is also a non-executive director of ASX-Listed
Ingham’s Group Limited where he serves on the Risk &
Sustainability Committee and the Finance & Audit Committee;
a non-executive director of Snowy Hydro Limited where he
serves on the Audit & Compliance Committee and the Safety,
Operations & Environmental Risk Committee; and a non-
executive director of the Board of the George Institute for
Global Health where he is Chair of the Risk Committee and
serves on the Audit Committee. He is also a member of the
Australian Government’s Takeovers Panel and a member of
Chifley Associates.
Other current directorships of listed companies
Non-executive director of Ingham’s Group Limited since
January 2022
Former directorships in last 3 years
None
Special responsibilities
Member of the Audit and Risk Committee since 16 August 2021
Chair of the Sustainability Committee since 1 January 2022
Member of the Nomination Committee since 1 January 2022
Interests in ordinary shares
100,000 ordinary shares
66
FINANCIAL REPORTABN 95 009 211 474DIRECTORS’ REPORT INFORMATION ON DIRECTORS (CONTINUED)
Craig Laslett
BEng (Civil), FIE(Aust) CP Eng, EngExc, FAICD
Non-executive director
Experience and expertise
Craig Laslett was appointed as a non-executive director on
28 February 2022.
Mr Laslett is a Civil Engineer with nearly 40 years of
engineering, project management and executive experience
across some of Australia’s largest publicly listed mining
services and infrastructure companies, including a role as the
Managing Director of Leighton Contractors, a subsidiary of the
Leighton Holdings Group (now CIMIC Group). This experience
included accountability for HWE Mining and Leighton Mining,
providing open cut mining, underground mining, and materials
processing services across operations in Australia and overseas.
Mr Laslett is currently the Managing Director and Co-Owner
of Leed Engineering & Construction Pty Ltd, a privately owned
civil infrastructure contractor.
Mr Laslett holds a Bachelor of Civil Engineering degree from
the University of South Australia, formerly the South Australian
Institute of Technology.
In addition to his professional career, Mr Laslett is passionate
about enhancing the contribution and value provided by the
contracting and services industries, including representing
the industry at board and governmental levels. This includes
enhancing digital capability and supporting industry diversity
and providing opportunities for indigenous and disadvantaged
youth.
Other current directorships of listed companies
None
Former directorships in last 3 years
None
Special responsibilities
Member of the Nomination Committee since 28 February 2022
Interests in ordinary shares
1,000 ordinary shares
Meetings of directors
The numbers of meetings of the Company’s board of directors and of each board committee held during the year ended
30 June 2022 and the numbers of meetings attended by each director were:
Full meetings of
directors
Audit & Risk
People &
Remuneration
Sustainability
Nomination
Meetings of committees
A B
11
11
11
11
10 11
10 11
11
11
9 10
4 6
A B
4 4
*
*
*
*
*
*
4 4
4 4
*
*
A B
4 4
*
*
4 4
2 2
2 2
*
*
*
*
A B
2 2
*
*
2 2
2 2
2 2
*
*
*
*
A B
1
*
1
1
1
1
1
1
*
1
1
1
1
1
Robert Cole - Chair
Mark Norwell
Mark Hine#
Alexandra Atkins#
Andrea Hall
Tim Longstaff #
Craig Laslett#
A = Number of meetings attended
B = Number of meetings held during the time the director held office or was a member of the committee during the year
* = Not a member of the relevant committee
# Director unable to attend unscheduled Board meeting.
67
PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT REMUNERATION REPORT
Dear Shareholders,
On behalf of the Board, I am pleased to present Perenti Global Limited’s (Perenti or Group) Remuneration Report for the financial
year to 30 June 2022.
The report details our remuneration framework for key management personnel (KMP), including how this framework is linked to
our business strategy and the remuneration outcomes that were provided to KMP during the 2022 financial year.
FY22 overview
We were deeply saddened by the death of three employees. At the Hemlo mine in Canada, Troy Cameron lost his life when he
was caught between ventilation doors underground and at the Zone 5 mine in Botswana, Baleseng Sechele and Moses Marpaung
also lost their lives in event underground after being overcome by blasting fumes. Working with our clients, we have investigated
the nature of these tragic events and will ensure these findings inform our safety programs and ongoing focus on preventing life-
changing events.
The Board understands that the number of our people getting injured at work is not acceptable and, whilst we have been focusing
on our Critical Risk Standards including being clear on the controls required to manage these risks and ensuring these controls are
in place, the fatalities in FY22 have impacted executive remuneration outcomes. In FY23 and beyond, we are focused on our safety
performance. Steps have been and continue to be taken to ensure we uphold our commitment to providing a safe workplace for
our people.
The Company’s financial performance for the year exceeded our expectations and was above the higher end of our revised
guidance with a solid underlying EBIT(A) result of $176.3 million. This was achieved, despite the ongoing significant challenges
related to numerous external factors including the continued impacts of the COVID-19 pandemic, border restrictions, geopolitical
conflicts, labour constraints and supply chain and inflationary pressures. We are appreciative of the efforts of our employees who
always strive to perform for our shareholders and support our clients and all stakeholders in our business.
Throughout the year management have paid particular attention to updating our 2025 Strategy, formalised the Capital
Management Policy and completed a full operating model review which will enable a more agile, empowered, and focused
business into the future. Some key outcomes in FY22 include:
• Completed a detailed cultural diagnostic report to fully understand core elements of our culture including how we operate, our
principles and the behaviours we expect to enable a high performing and safe (physical & psychological) environment for our
people,
• Developed and implemented a plan to eliminate sexual harassment and other harmful behaviours. This plan included our
It’s Not Ok campaign which surveyed our people to understand the reality of any harmful behaviours in our workplaces,
•
Introduced a Culture and Inclusion Steering Group to provide oversight, direction and guidance across the company on cultural
and inclusion initiatives,
• Mobilising new work in quality mining jurisdictions including the expansion into North America with the Red Chris project,
New South Wales in Australia at the Cowal underground development and production contract and the ongoing ramp up at the
Zone 5 underground project and the Motheo surface mining project both in Botswana,
• The idoba business has acquired the Orelogy and Atomorphis businesses as well as signing a Memorandum of Understanding
with Sumitomo Corporation for the co-creation of digital mining products for the advancement of sustainable mining practices,
and
• The sale of our MinAnalytical and Well Control Solutions businesses, as well as a property asset and our portfolio of equity
shares including the Chrysos investment with the proceeds used to generate long term future value for our shareholders.
FY22 remuneration outcomes overview
The Board has assessed the FY22 remuneration outcomes to balance incentivising and rewarding and retaining our executives
while ensuring they reflect overall business performance (including safety performance) and shareholder experience.
Executive KMP fixed remuneration outcomes
The Board was comfortable that the Total Fixed Remuneration (TFR) for the Managing Director & CEO, and CEO Contract Mining
continued to be market competitive and as such their TFR and incentive opportunities were unchanged. However, after reviewing
external peer market data, a modest increase was provided to the Chief Financial Officer’s TFR increasing from $560,000 to
$600,000 to better align his TFR with the market.
Short term incentive (STI) remuneration outcomes
The Board has reviewed the FY22 STI scorecard outcomes with a summary provided below:
• Due to the tragic fatalities, the fatality gateway for the safety metrics was not met, resulting in the 20% allocated to the safety
components of the scorecard being reduced to 0%. However, the actual business outcome forfeited by each KMP was 30%
given that two of the three safety metrics achieved stretch, before the application of the individual multiplier, and
• For our financial measures; the Group financial EBIT(A) metric has achieved at between target and stretch performance, cash
conversion at stretch performance and work in hand at between target and stretch performance.
68
FINANCIAL REPORTABN 95 009 211 474DIRECTORS’ REPORT REMUNERATION REPORT (CONTINUED)
The application of the business and individual outcome modifier has led to a FY22 outcome for the Managing Director & CEO of
87% of maximum STI opportunity, 80% for the Chief Financial Officer and 84% for the CEO Contract Mining. From a maximum
opportunity perspective, the Executive KMP’s have forfeited on average 16% of their STI award, which the Board believes is
reflective of a balanced position given the year’s safety and financial performance.
Long term incentive (LTI) remuneration outcomes
The first Perenti LTI awards granted in FY19 were tested for vesting against its performance hurdles in FY22. The relative total
shareholder return (rTSR) component of that award did not meet threshold vesting requirements, therefore vested at 0%. However,
the return on average capital employed (ROACE) component met threshold performance. The combined performance provided
for an overall 30.6% vesting outcome of the possible LTI opportunity. The Board feels this outcome is reflective of the company’s
performance over the LTI performance period.
FY22 incentive framework changes
As noted last year, Perenti had engaged an external remuneration consultancy to provide an all-encompassing review on our
variable remuneration plans. Based on the outcomes of this review and feedback from shareholders, the following changes were
made:
• The LTI rTSR peer group was revised as several comparators had shifted in size and/or operational focus and more relevant
comparators had entered the market. The peer group continues to consist of mining services companies,
• Return on equity (ROE) replaces the ROACE metric in the LTI with a reduced weighting (50% to 30%). This aims to reflect
feedback from investors that ROE would more accurately assess our capital efficiency and aligns with our updated strategy,
• A strategic initiative component worth 20% was introduced. This component comprises financial and non-financial measures
which aim to incentivise performance related to long term cultural and financial improvements that create value for
shareholders,
• The first measure (10% weighting), aligned with our 2025 Strategy, will assess cultural improvements, in particular through
creating a psychologically safe and inclusive work environment. We aim to create an environment that sets us apart from
our peers and delivers a strategic advantage in a competitive labour market. This also seeks to strengthen one of our key
organisational principles of Smarter together. We will ensure appropriate, objectively measurable KPIs are in place for achieving
this outcome,
• The second measure (10% weighting) requires reducing debt leverage to sub 1.0 times EBITDA, excluding possible acquisitions.
This measure, which is aligned with our 2025 Strategy, incentivises an improved focus on capital management and acts as a
balance with our introduction of ROE, where management is not incentivised to unnecessarily increase debt, and
•
In the STI, a single Group business scorecard was applied for all Executive KMP. Previously, varying scorecards applied to
different KMP. This approach ensures a collective focus on Group achievements, with individual performance differentiated via
the individual multiplier.
Full details of the updates to the FY22 remuneration framework are detailed in sections 4 and 6, and further detail on the LTI will be
provided in the 2022 Notice of Meeting.
Board remuneration outcomes
Fee levels for the Board roles have remained unchanged since 1 January 2020.
A new Sustainability Committee was introduced in January 2022 to assist the Board in fulfilling its responsibilities in relation to
sustainability matters including safety, health, environment, climate change, communities and social performance, and human
rights. We believe this will assist the Board to place an increased focus on improving the safety performance at the Company. The
Sustainability Committee fees are the same as for the other committees of the Board.
The Board also established a separate Nomination Committee to recognise the benefit of focus from a standalone committee.
The Nomination Committee includes all non-executive director and no separate committee fees have been provided for the
Chair or members.
Summary
The Board is confident that the FY22 remuneration outcomes and the updates to the FY22 framework provide for a balanced
approach to remuneration that seeks to appropriately reward financial and non-financial performance and shareholder value
creation.
We thank you for your support and we look forward to welcoming you to our AGM.
Mark Hine
Chair, People and Remuneration Committee
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PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT REMUNERATION REPORT (CONTINUED)
1.
Introduction
The Directors present the Perenti FY22 Remuneration Report, outlining key aspects of our remuneration principles, framework,
and remuneration awarded this year.
The Remuneration Report is structured as follows:
Introduction
1.
2. KMP for FY22
3. Remuneration strategy and principles
4. FY22 Remuneration changes
5. Outcomes in FY22
6. FY22 Executive KMP Remuneration Framework
7. Remuneration governance
8. Contractual arrangements with Executive KMP
9. Non-executive director remuneration
10. Additional statutory information
2. KMP for FY22
The tables below confirm all the KMP covered by the FY22 Remuneration Report:
Non-executive Directors (NEDs)
Term
Robert Cole
Mark Hine
Alexandra Atkins
Andrea Hall
Tim Longstaff
Chairperson
Audit and Risk Committee – Member
People and Remuneration Committee – Member
Sustainability Committee – Member
Nomination Committee – Chair
Non-executive director
People and Remuneration Committee – Chair
Sustainability Committee – Member
Nomination Committee – Member
Non-executive director
People and Remuneration Committee – Member
Sustainability Committee – Member
Nomination Committee – Member
Non-executive director
Audit and Risk Committee – Chair
People and Remuneration Committee – Member
Nomination Committee – Member
Non-executive director
Audit and Risk Committee – Member
Sustainability Committee – Chair
Nomination Committee – Member
Craig Laslett
Non-executive director
Nomination Committee – Member
Full year
Full year
Full year
Part year (from 1 January 2022)
Part year (from 1 January 2022)
Full year
Full year
Part year (from 1 January 2022)
Part year (from 1 January 2022)
Full year
Part year (until 31 December 2021)
Part year (from 1 January 2022)
Part year (from 1 January 2022)
Full year
Full year
Part year (from 1 January 2022)
Part year (from 1 January 2022)
Part year (from 16 August 2021)
Part year (from 16 August 2021)
Part year (from 1 January 2022)
Part year (from 1 January 2022)
Part year (from 28 February 2022)
Part year (from 28 February 2022)
Executive Key Management Personnel (KMP)
Mark Norwell
Managing Director & Chief Executive Officer (MD & CEO)
Peter Bryant
Chief Financial Officer (CFO)
Term
Full year
Full year
Paul Muller
Chief Executive Officer Contract Mining (CEO Contract Mining)
Full year
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FINANCIAL REPORTABN 95 009 211 474DIRECTORS’ REPORT REMUNERATION REPORT (CONTINUED)
3. Remuneration Strategy and Principles
Outlined below is Perenti’s remuneration approach.
REMUNERATION STRATEGY
Perenti’s remuneration strategy aims to enable the achievement of the Company’s business objectives, and reward
Executive KMP where its company strategy is achieved. To achieve the Company’s business objectives, the framework is
guided by the following principles in the table below.
REMUNERATION PRINCIPLES
ATTRACT AND RETAIN SHAREHOLDER
ALIGNMENT
PAY-FOR-
PERFORMANCE
MARKET
COMPETITIVE
SIMPLE AND
TRANSPARENT
Enable Perenti to
attract, motivate and
retain talented and high
performing employees
that can execute and
deliver our business
objectives.
Align remuneration
with the shareholder
experience and long
term value generation.
Linking remuneration
to the performance of
the Company and the
individual.
Provide remuneration,
which is competitive
and relative to the
market we are
operating within.
Can be easily
explained and
understood by
internal and external
stakeholders.
EXECUTIVE KMP REMUNERATION FRAMEWORK
ELEMENT
Total Fixed Remuneration
(TFR)
Short-Term Incentive
(STI)
Long-Term Incentive
(LTI)
HOW IS IT DELIVERED
Cash
Cash and equity
Equity
HOW IT WORKS
Provided as cash and
statutory superannuation
contributions
Award payment is provided
as two thirds in cash and one
third as STI Rights deferred
for 12 months
Award outcome is calculated
as business outcomes times
individual STI modifier
STI Rights are subject to
malus and clawback
Provided as performance
rights subject to a three-year
performance period
Measured against
strategically focused
performance metrics
Subject to malus and
clawback
HOW IS IT POSITIONED
Positioned at the 50th
percentile of comparative
benchmarking data
Target Total Reward including TFR, STI and LTI at target
outcomes is positioned at the 62.5th percentile of
comparative market data
WHAT IT ACHIEVES
Allows us to attract and
retain key talent to deliver on
business objectives
Incentivises strong
performance to deliver on
the key business priorities
through variable, at-risk
payments
Align reward with the
shareholder experience and
long-term value generation
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PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT REMUNERATION REPORT (CONTINUED)
4. FY22 Remuneration Changes
The following updates to the FY22 remuneration approach were made.
ADJUSTMENTS WITHIN
THE REMUNERATION
FRAMEWORK
TOTAL FIXED
REMUNERATION (TFR)
FY21 APPROACH
CHANGE IN FY22
Various adjustments
made as reported
in the 2021 annual
report
Only the CFO’s TFR was
increased from $560,000 to
$600,000 from 1 October
2021.
No changes to incentive
opportunities were made.
ALIGNMENT TO REMUNERATION
PRINCIPLES AND RATIONALE
ATTRACT AND RETAIN, MARKET
COMPETITIVE
Benchmarking data against peers of
comparable market capitalisation
and revenue indicated the CFO
was paid below market. The
Board provided a modest increase
to the CFO’s TFR to enhance
competitiveness in the market.
STI SCORECARD
Separate business
outcomes scorecard
for CEO Contract
Mining
Aligned business outcomes
scorecard for all Executive
KMP.
PAY FOR PERFORMANCE,
SHAREHOLDER ALIGNMENT,
SIMPLE AND TRANSPARENT
LTI PERFORMANCE
MEASURES
• 50% rTSR, and
• 50% rTSR. No updates to
• 50% ROACE
performance hurdles, with
an updated peer group
used,
• 30% ROE replacing ROACE
as the capital efficiency
measure, and
• 20% strategic initiatives.
Ensures a collective executive
team focus on achieving Group
outcomes, whilst the individual
modifier continues to allow for
the differentiation of individual
performance.
ATTRACT AND RETAIN,
SHAREHOLDER ALIGNMENT,
PAY FOR PERFORMANCE
The Board engaged an external
remuneration consultant and
shareholder feedback to support a
review of incentive plans.
Following the review:
• The rTSR peer group was updated
to ensure the most appropriate
mining services companies
continue to be included,
• To reflect investor feedback that
ROACE does not best reflect
Perenti’s capital performance
and concerns that the use of
underlying NPAT(A) is preferable
to underlying EBIT, ROE has been
selected, and
• A strategic component,
comprising of financial and
non-financial measures, was
introduced to incentivise the
focus and achievement of long-
term objectives.
To note, in FY23 the CFO’s TFR will increase from $600,000 to $675,000 effective 1 October 2022. This increase reflects
significant movement in the CFO benchmark survey data over the prior 24 months, hence increases in consecutive
years. Additionally, the FY23 KMP scorecard will move from 200% to 150% of target STI opportunity, in line with Godfrey
Remuneration Group’s independent review. This change was implemented in FY22 for non-KMP and now aligns our
STI scorecard application for all employees, commencing in FY23. For clarity, the maximum STI opportunity will remain
unchanged.
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5. Outcomes in FY22
(a) Company performance
The Company is conscious of the need to link remuneration to performance. The table below sets out a summary of
information which provides details of performance measures used for the Executive KMP with some of the measures used
in the STI or LTI plan.
Table 1 – Company Performance FY18 – FY22
Sales revenue
Underlying EBIT(A)^
22
$’000
21
$’000
20
19
18
$’000
$’000
$’000
2,437,656
2,087,542
2,046,058
1,638,392
866,281
176,293
170,787
211,708
180,707
86,823
Operating profit before income tax*
93,484
22,369
107,146
268,554
74,079
Profit/(loss) after tax attributable to equity holders
40,658
(55,140)
23,837
181,326
61,050
Net profit/(loss) after tax
42,486
(52,303)
27,555
182,281
61,050
Share price at start of year ($ per share)
Share price at end of year ($ per share)
0.67
0.66
1.16
0.67
1.83
1.16
1.84
1.83
1.84
1.84
Dividends paid/payable
14,108
49,272
48,043
42,602
19,855
Basic earnings/(loss) (cents per share) from
continuing operations
Diluted earnings/(loss) (cents per share) from
continuing operations
Total Recordable Injury Frequency Rate (TRIFR)
^ Non IFRS Measure | * Does not include impairment expense
5.8
5.7
6.9
(7.8)
(7.8)
5.1
3.5
3.5
4.9
30.0
16.9
29.8
4.5
16.6
3.5
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PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
5. Outcomes in FY22 (continued)
(b) FY22 STI business outcomes
The STI award incentivises executive and senior leaders’ performance to deliver on the key business priorities to ensure
success in the current financial year and future years. These business outcomes are a balance of financial and non-financial
performance measures that are within the control of the Executive KMP. Table 2 summarises the performance versus target
for the FY22 STI scorecard business outcomes for the Executive KMP, with additional details on the performance measures
described below.
Table 2 – FY22 STI business outcomes for the Executive KMP
Category
Performance
measure
Target
Weighting
%
Threshold
Target
Stretch
Performance
Outcome
%
Adjusted
Outcome
%
Outcome detail
Safety
TRIFR
% of ‘above the
line’ actions
from SPI
investigations
Critical Control
Verification
completion
Financial
performance
Underlying
Group EBIT(A)
Financial
stability
EBITDA Cash
Conversion
Growth
Mining work in
hand ratio
5
5
10
40
20
20
FY22 Performance outcome
0
10.0
20.0
0
0
0
63.0
63.0
40.0
40.0
36.4
36.4
169.4
139.4
Fatality gateway was not
met, hence adjusted
outcome was nil for this
metric
TRIFR was performing
under threshold
performance
Fatality gateway was not
met, hence adjusted
outcome was nil for this
metric
Metric was performing at
stretch performance
Fatality gateway was not
met, hence adjusted
outcome was nil for this
metric.
Metric was performing at
stretch performance
Between target and
stretch performance.
Underlying EBIT(A)
$176.3M based on
Perenti’s net interest in
subsidiaries achieved
against a $169.0M target.
Achieved 108% against
a 95% target providing
stretch performance.
Achieved above target
performance with a 2.38
ratio against a 2.27 target.
Overall business
performance provided
for a target to stretch
outcome
In addition to Executive KMP and Perenti Group Executive, the STI Plan was provided to a further 64 participants across the
Group.
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FINANCIAL REPORTABN 95 009 211 474DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
5. Outcomes in FY22 (continued)
(c) FY22 individual modifier outcome for Executive KMP
In addition to the business outcome scorecard, Executive KMP have their individual performance assessed by the
Board based on:
•
Individual performance measures for their area of responsibility that are set at the start of the year and reviewed on a
regular basis, including the outcomes discussed in the People and Remuneration Committee Chairperson’s letter.
• How they delivered against their performance measures, which takes into consideration demonstrated leadership
attributes and behaviours as aligned with our principles and business strategy.
This approach ensures that safeguards are in placed to protect against the risk of unintended and unjustified STI award
outcomes.
The FY22 individual modifier outcomes for Executive KMP ranged from 115% to 125% as per below.
Executive KMP
Individual modifier
Rationale for modifier
Mark Norwell
(MD & CEO)
125%
Peter Bryant
(CFO)
115%
Paul Muller
(CEO Contract Mining)
120%
Taken significant steps to strategically shift the organisation to
provide greater value to shareholders with a refreshed strategy that
focuses on total shareholder returns, free cash flow, reducing capital
intensity through diversifying the portfolio and increased focus
on debt management. In addition, the FY22 EBIT(A) performance,
notwithstanding significant headwinds, exceeded our expectations and
was above the higher end of revised guidance at $176.3 million with cash
conversion and work in hand metrics performing between target and
stretch. Has also been instrumental in driving the Perenti principles and
leading from the front on broader cultural outcomes including sexual
harassment and other harmful behaviours. Overall, and along with the
Group Executive, progress continues to be made to deliver current
priorities and position for the future.
Increasing leadership presence across the business and continued
strong external engagement. Has been proactive in a number of areas
including debt refinancing and divestment activities. Continues to be a
strong contributor in driving financial and business outcomes. Played
a key role, along with other executive leaders in refreshing the Perenti
group strategy and developing a revised operating model for the
business.
Successfully led the global Contract Mining Division against a backdrop
of significant COVID-19 and global economic headwinds to exceed
budget to EBIT(A) performance, cash conversion and work in hand
metrics and position Contract Mining for a strong FY23. Played a key
role, along with other executive leaders in refreshing the Perenti group
strategy and developing a revised operating model for the business.
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PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT REMUNERATION REPORT (CONTINUED)
5. Outcomes in FY22 (continued)
(d) Overall FY22 STI outcomes
The overall FY22 STI outcome as determined through the Board’s assessment of the business outcomes and application of
the individual modifier is represented in the Table 3 below.
Table 3 – Overall FY22 STI award outcomes for the Executive KMP
Executive KMP
Mark Norwell (MD & CEO)
Peter Bryant (CFO)
Maximum
STI
opportunity
(A)
$
1,110,000
420,000
Paul Muller (CEO Contract Mining)
962,800
Business
outcome
(B)
Individual
modifier
(C)
Overall STI
outcome
of target
opportunity
(D) = (B x C)
Calculated STI
award
(A) X (D) x 50%
STI cash
portion
Deferred
STI Rights
portion [1]
% of
maximum
STI
awarded
% of
maximum
STI
forfeited
%
139.4
139.4
139.4
%
125
115
120
%
174.3
160.3
167.3
$
$
$
967,274
644,850
322,424
336,716
224,477
112,239
805,441
536,961
268,480
%
87
80
84
%
13
20
16
[1] One third of the STI award is deferred into STI Rights that will be granted around October 2022 and will be eligible to vest into Perenti shares 12 months later
subject to Board approval.
(e) FY19 LTI vesting outcome
Our FY19 LTI grant was tested for performance following the end of the performance period on 30 June 2021.
50% of the Rights were subject to a rTSR measure and 50% were subject to a ROACE measure.
The rTSR Rights did not achieve the 50th percentile threshold vesting requirements and lapsed. ROACE over the
performance period was calculated at 16.5% which achieved vesting of 61.1% of the ROACE Rights.
As a result, an overall vesting outcome of 30.6% was achieved against the maximum FY19 LTI opportunity.
Table 4 – FY19 LTI outcome awarded in FY22
Executive KMP
Number of
Rights granted
Number of
rights vested
into shares
Value at
grant [1]
$
Mark Norwell (MD & CEO)
649,087
198,332
960,000
134,112
(825,888)
Peter Bryant (CFO)
269,777
82,432
399,000
55,741
(343,260)
Paul Muller (CEO Contract Mining)
393,002
120,084
581,250
81,201
(500,049)
Value at
vesting [2]
Value
movement
% of maximum
LTI awarded
% of maximum
LTI forfeited
$
$
%
30.6
30.6
30.6
%
69.4
69.4
69.4
[1] Value at grant is the FY19 LTI maximum opportunity which is the number of rights multiplied by the 10 day Volume Weighted Average Price (VWAP) of Perenti
shares over the last 10 trading days of October 2018, which was $1.4790.
[2] Value at vesting is the number of shares that vested, multiplied by the closing by the 10 day VWAP of Perenti shares over the last 10 trading days of June 2021,
which was $0.6762.
(f) FY22 LTI grant
For our FY22 LTI plan, Executive KMP were offered Performance Rights as per the table below (subject to the terms and
conditions as outlined in section 6b).
Table 5 – FY22 LTI offering
Executive KMP
Mark Norwell (MD & CEO)
Peter Bryant (CFO)
Paul Muller (CEO Contract Mining)
LTI opportunity
(% of TFR)
LTI
opportunity
%
120
75
75
$
1,332,000
420,000
722,100
10 Day
VWAP
$
0.6762
0.6762
0.6762
Offered
Performance
Rights [1]
$
1,969,831
621,118
1,067,879
Target LTI
(% of TFR) [2]
%
60.0
37.5
37.5
Target LTI
$
666,000
210,000
361,050
[1] The number of Rights offered is TFR multiplied by the LTI opportunity divided by the 10 day Volume Weighted Average Price (VWAP) of Perenti shares over
the last 10 trading days of June 2021, which was $0.6762.
[2] Target LTI represents 50% of LTI opportunity and represents the difficulty of achieving performance hurdles and share price volatility.
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FINANCIAL REPORTABN 95 009 211 474DIRECTORS’ REPORT
5. Outcomes in FY22 (continued)
(g) Statutory disclosure of FY22 Executive KMP remuneration
The table has been prepared in accordance with relevant accounting standards reflecting the remuneration for each Executive KMP that relates to their
services in FY22. Where applicable, remuneration for Executive KMP has been pro-rated for the period they served as a KMP.
Table 6 – Executive KMP remuneration
Fixed Remuneration
Variable remuneration
Name
Year
Cash Salary
Non-monetary
benefits
Leave
entitlements [1]
Post-
employment
benefits
(Super)
EXECUTIVE KMP
2022
1,086,432
M Norwell
2021
1,042,056
42,155
32,911
P Bryant
P Muller
2022
2021
2022
2021
566,432
535,806
939,234
885,707
FORMER EXECUTIVE KMP
S Winter
2022
2021
-
163,326
-
-
-
-
-
-
(5,710)
26,772
26,171
17,146
671
23,094
23,568
21,694
23,568
21,694
23,568
21,694
-
-
-
5,424
2022
2,592,098
42,155
21,132
70,704
2021
2,626,895
32,911
67,012
70,506
2022
719,488
2021
738,625
-
-
-
-
71,948
70,169
9,670
Total executive
directors and
other KMPs
Total
non-executive
directors
Total KMP
remuneration
expense
Notes
Other
STI cash
payment
STI Rights
Performance
Rights [2]
Retention
Rights [3]
Total
-
-
-
-
-
-
-
-
-
-
-
644,850
322,424
512,323
183,416
183,416
488,618
224,477
112,239
182,221
59,976
59,976
200,760
536,961
268,480
289,194
-
-
-
-
-
2,626,042
1,978,883
1,135,108
895,358
2,058,108
252,049
252,049
292,773
143,227
1,870,593
-
-
-
-
-
-
-
-
-
168,750
1,406,288
703,143
983,738
-
5,819,258
495,441
495,441
982,151
143,227
4,913,584
-
-
-
-
-
-
-
-
791,436
818,464
2022
3,311,586
42,155
21,132
142,652
-
1,406,288
703,143
983,738
-
6,610,694
2021
3,365,520
32,911
67,012
140,675
9,670
495,441
495,441
982,151
143,227
5,732,048
R
E
M
U
N
E
R
A
T
I
O
N
R
E
P
O
R
T
(
C
O
N
T
I
N
U
E
D
)
[1] This includes annual leave and long service leave.
[2] The 2021 figure includes Performance Rights granted (for accounting purposes) by the Company in FY19, FY20, FY21 and the 2022 figure also includes rights
granted in FY20, FY21 and FY22.
[3] Includes Retention Rights granted (for accounting purposes) by the Company in FY19 with a two year retention period that have now vested.
7
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PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
6. FY22 Executive KMP Remuneration Framework
The remuneration packages of Executive KMP are comprised of fixed remuneration and variable ‘at-risk’ remuneration in the
form of an STI and LTI.
(a) Remuneration mix
Diagram 1: The remuneration mix for Perenti’s Executive KMP at target levels for FY22 is represented below.
MANAGING
DIRECTOR & CEO
CEO CONTRACT
MINING
CHIEF FINANCIAL
OFFICER
FY22 TARGET REMUNERATION
$2,331,000
52% at risk
$1,805,240
47% at risk
$1,020,000
41% at risk
$
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
Fixed remuneration
STI (cash)
STI (STI rights)
LTI Target (50% of face value)
(b) Executive KMP remuneration components
Diagram 2: A summary of the remuneration structure over time for Executive KMP is below
FIXED
Base salary and
superannuation
Variable
STI (12 months)
LTI (36 months)
Cash
Deferred Rights
YEAR 1
YEAR 2
YEAR 3
MD & CEO and CEO Contract Mining
target is 50% of TFR and maximum is 100%
of TFR.
CFO target is 35% of TFR and maximum is
70% of TFR
MD & CEO maximum is 120% of TFR.
CFO and CEO Contract Mining maximum
is 75%
Total Fixed Remuneration (TFR)
Description
A competitive level of TFR is offered to attract and retain high quality and experienced Executive
KMP. TFR comprises of all fixed remuneration including statutory superannuation contributions.
If the statutory superannuation contribution is required to increase, the Executive KMP will have
an equal reduction in base salary to ensure their TFR is unchanged.
Approach
TFR is reviewed annually and on promotion to ensure that it is market competitive.
The Company targets the median of the relevant market. The relevant market peer group will
take into consideration one or more of the following:
• Peer mining services companies; and/or
• Companies with market capitalisation and/or annual revenue in a range comparable to
Perenti.
The TFR review also gives regard to the size, geographic reach, and complexity of the Company.
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FINANCIAL REPORTABN 95 009 211 474DIRECTORS’ REPORT REMUNERATION REPORT (CONTINUED)
6. FY22 Executive KMP Remuneration Framework (continued)
(b) Executive KMP remuneration components (continued)
FY22 Short-term Incentive (STI)
Description
Executive KMPs are eligible to participate in the annual STI plan, which comprises a portion
of their variable remuneration and is subject to performance measures. The STI performance
outcome is based on a business outcome scorecard, which includes a mix of safety, financial
and growth measures, that is multiplied by an individual modifier.
Award operation
The Executive KMP’s business outcome scorecard comprises of a mix of financial and non-
financial measures. All measures have a threshold, target and stretch level of achievement. The
weighting of each business outcome metric is then applied to its performance, with the total
equalling the business outcome.
The business outcome is then multiplied by an individual modifier (with a range from zero
to 1.5 times but not exceeding maximum STI opportunity) which reflects what the individual
achieved through their Individual KPI’s and how the individual achieved these KPI’s in terms of
their behaviours as aligned to Perenti’s Principles.
The operation of the STI award is demonstrated through the below graphic:
INDIVIDUAL MODIFIER
BUSINESS OUTCOME
STI AWARD
0% - 200%
Target 100%
0 to x 1.5 impact
Up to maximum
STI opportunity
The Board retains absolute discretion with respect to the targets and outcomes assessed under
the STI plan. Any discretion is applied after consideration of factors both positive and negative
to the outcome.
Gateways
Should a workplace related fatality occur the relevant safety portion (20% weighting) of the
scorecard is foregone.
Performance period
Financial year
Maximum
opportunity
MD & CEO and the CEO Contract Mining: 100% of TFR
CFO: 70% of TFR
Measures
Measure
Weighting Further detail
Total Recordable
Injury Frequency Rate
(TRIFR)
5%
A TRIFR metric assists in measuring an element of safety
performance. This measure aims to ensure there is a
substantial improvement in recordable safety outcomes,
compared to the prior year.
In addition, this component is subject to a ‘fatality’
gateway. Where a work-related fatality occurs during the
performance period, no payment will be made under this
component.
Group Serious
Potential Incident
(SPI) investigations
that identify at least
one ‘above the line’
action
5%
This is a leading safety metric, to reinforce the importance
of learning and implementing robust controls to prevent
recurrence of incidents and improve safety.
An above the line action refers to engineering, substitution,
isolation or elimination control actions under the hierarchy
of control.
In addition, this component is subject to a ‘fatality’
gateway. Where a work-related fatality occurs during the
performance period, no payment will be made under this
component.
79
x= PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT REMUNERATION REPORT (CONTINUED)
6. FY22 Executive KMP Remuneration Framework (continued)
(b) Executive KMP remuneration components (continued)
FY22 Short-term Incentive (STI) (continued)
Measures
Measure
Weighting Further detail
Group Critical
Control Verification
Completion
10%
A metric to ensure a strong program and culture of
managing critical risks is developed and embedded.
This measure aims to ensure that operational leaders
are actively verifying critical controls in the field with
workgroups whilst they are undertaking critical risk
activities.
In addition, this component is subject to a ‘fatality’
gateway. Where a work-related fatality occurs during the
performance period, no payment will be made under this
component.
EBIT (A) defined
as earnings before
finance costs, finance
income, income tax
expense or benefit
and amortisation of
intangible assets
EBITDA Cash
Conversion
40%
The use of EBIT(A) ensures that the majority of the
individual’s STI is aligned to the Company’s financial
performance that is within the control of the executive.
It aims to build a pay-for-performance culture and
ensure executive accountability for the Company’s
performance.
20%
The percentage of EBITDA converted to cash.
Work in Hand ratio
of secured revenue
at the end of FY22 to
FY22 budget revenue
20%
This metric evaluates the efficiency of the company’s
operations and management.
This component measures the portion contractually
remaining on executed contracts against revenue to
ensure a strong and robust growth pipeline.
A qualitative assessment will be made on the quality of
the contract terms as well as the quantitative assessment.
Delivery
For FY22, two thirds of any outcome is delivered in cash and one third is delivered in STI Rights.
The STI Rights vest 12 months after their grant date.
Any STI Rights that are provided to the MD & CEO are subject to shareholder approval as per
ASX Listing Rule 10.14.
Allocation
methodology (STI
Rights only)
The deferred STI Rights will be allocated on a face value basis. This is calculated as the STI
Rights opportunity ($) divided by the 10-day volume weighted average price (VWAP) of the
Company’s shares up to and including the end of the performance period, which is 30 June
2022.
Cessation of
employment
Typically, if employment ceases before the end of the performance period, the Executive KMP
foregoes any STI award for the current performance period which they would have otherwise
been entitled.
STI Rights that have been awarded will become unrestricted in the usual course unless the
participant is deemed to be a bad leaver as defined by the Plan Rules.
Notwithstanding the above, the Board retains absolute discretion to treat STI awards and
vesting as it sees fit on cessation of employment.
Malus/clawback
In circumstances of fraud, dishonesty or gross misconduct by the participant, or breach of
duties or obligations by the participant, the Board has the ability to:
•
lapse all unvested STI awards (malus); and
• require the individual to repay a portion of any STI awards which have vested (clawback).
80
FINANCIAL REPORTABN 95 009 211 474DIRECTORS’ REPORT REMUNERATION REPORT (CONTINUED)
6. FY22 Executive KMP Remuneration Framework (continued)
(b) Executive KMP remuneration components (continued)
FY22 Long-term Incentive (LTI)
Description
LTI is delivered via a Performance Rights plan with annual grants made to eligible employees
(including all Executive KMP) as part of their variable remuneration. The Performance Rights are
subject to performance measures and a three-year performance period.
Performance period
Three (3) years, commencing on 1 July 2021 and ending 30 June 2024.
Maximum
opportunity
MD & CEO: 120% of TFR
CFO and the CEO Contract Mining: 75% of TFR
Delivery
Allocation
methodology
Performance
measures
The LTI will be wholly delivered in Performance Rights.
Any Performance Rights that are provided to the Managing Director & CEO are subject to
shareholder approval as per ASX Listing Rule 10.14
The LTI will be granted on a face value basis. This is calculated as the LTI opportunity ($) divided
by the 10 day volume weighted average price (VWAP) of the company’s shares prior to the
commencement date of the performance period, which is 1 July 2021.
The performance measures are aligned to shareholder returns and the business strategy.
Relative Total Shareholder Return (TSR) (50%)
The vesting metrics are as follows:
Level of performance
% of Performance Rights that will vest
Below Median
Median
Median to 75th percentile
75th percentile and above
0%
50%
Straight-line vesting between 50% and 100%
100%
The peer group for the relative TSR measure includes Boart Longyear Limited; DDH1 Limited;
Emeco Holdings Limited; Imdex Limited; MACA Limited; Macmahon Holdings Limited; Mader
Group Limited; Monadelphous Group Limited; NRW Holdings Limited; and SRG Global Limited.
Vesting assessment is inclusive of Perenti’s TSR.
Return on equity (ROE) (30%)
The vesting metrics are as follows with ROE performance calculated as the simple average of
the ROE calculations for each of the three relevant financial years.
Level of performance
% of Performance Rights that will vest
Less than 6.0% ROE over Performance Period.
6.0% ROE over Performance Period.
Between 6.0% and 6.8% ROE over
Performance Period.
Greater than 6.8% ROE over
Performance Period.
0%
30%
Straight-line vesting between 30% and 100%
100%
Strategic initiative 1: Psychologically safe work environment (10%)
Vesting is based on the Board’s assessment of strategically shifting the culture of the
organisation to ensure a psychologically safe and inclusive work environment. This initiative
requires evolving our culture to provide a strategic advantage in line with increasing societal
expectations of a safe and respectful workplace through the elimination of bullying and sexual
harassment.
Assessment will be via completion of elimination of bullying and sexual harassment action plans
and improvement in related workplace surveys.
Strategic initiative 2: Reducing debt leverage (10%)
Vesting is based on reducing leverage to less than 1.0 times EBITDA, excluding possible
acquisitions, as aligned to the Capital Management Policy introduced in December 2021.
The Board retains absolute discretion with respect to the targets and outcomes assessed under
the LTI plan.
81
PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT REMUNERATION REPORT (CONTINUED)
6. FY22 Executive KMP Remuneration Framework (continued)
(b) Executive KMP remuneration components (continued)
FY22 Long-term Incentive (LTI) (continued)
Cessation of
employment
Typically, if employment ceases before the end of any LTI performance periods, the KMP
foregoes any Performance Rights for the performance periods which they would have
otherwise been entitled.
Notwithstanding the above, the Board retains absolute discretion to treat LTI awards and vesting
as it sees fit on cessation of employment.
Malus/clawback
In circumstances of fraud, dishonesty or gross misconduct by the participant, or breach of
duties or obligations by the participant, the Board has the ability to:
•
lapse all unvested LTI awards (malus); and
• require the individual to repay a portion of any LTI awards which have vested (clawback).
This may occur via a sale of shares allocated under the LTI plan.
7. Remuneration Governance
Board
External Stakeholder Engagement
Approves the overall Executive KMP remuneration framework, Executive KMP
remuneration levels and non-executive director remuneration, having regard to
the People and Remuneration Committee’s recommendations.
Consultation with proxy advisors
and institutional investors to ensure
external feedback is received.
People and Remuneration Committee
The Committee reviews and determines our remuneration framework annually
to ensure it remains aligned to business needs and meets our remuneration
principles.
Management
Provides the People and Remuneration Committee with the required
information to assist with remuneration decisions and recommendations.
Communicates with external remuneration consultants to ensure the People
and Remuneration Committee has all the necessary information.
External Remuneration Consultants
From time to time, the People and
Remuneration Committee may
engage external remuneration
consultants to inform its views.
SW Corporate were engaged by the People and Remuneration Committee as external remuneration advisors. A separate
advisor, Godfrey Remuneration Group, was engaged by management to undertake the incentive framework review. Neither
were required to provide any remuneration recommendations during FY22.
8. Contractual Arrangements with Executive KMP
Remuneration and other terms of employment for Executive KMP are formalised in service agreements. A summary of the
terms of employment as of the end of FY22 are presented below.
Table 7 – Employment contracts
Name
Mark Norwell (MD & CEO)
Peter Bryant (CFO)
Paul Muller (CEO Contract Mining)
TFR ($)
1,110,000
600,000
962,800
Duration of service
agreement
By executive
By company
Notice period
Ongoing
Ongoing
Ongoing
6 months
3 months
3 months
6 months
3 months
3 months
Severance payment
entitlement
No entitlement
No entitlement
No entitlement
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FINANCIAL REPORTABN 95 009 211 474DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
9. Non-executive Director Remuneration
Non-executive directors’ fees are set at a level which enables the attraction and retention of experienced and skilled Board
members to ensure an effective oversight role over the Company’s operations. Fee levels aim to reflect the demands which are
made on, and the responsibilities of, the directors.
Non-executive directors’ fees are reviewed annually by the Board to ensure fee levels are appropriate and in-line with the
market. Whilst no further increases were provided for FY22, the introduction of the Sustainability Committee, to support the
Company’s Sustainability Strategy including oversight of safety performance, means the Chair and members of that committee
received higher total fees in FY22 than FY21. No fees are payable to the Chair or members of the Nomination Committee.
The maximum aggregate amount we can pay our non-executive directors is $1.2 million per annum with shareholder approval
required to increase this amount. The current Perenti Board fees are outlined below.
Position
FY22 fees*
FY21 fees*
Increase
Board Chair **
Board Members
Committee Chair
Committee Members
$
225,000
114,975
20,000
11,000
$
225,000
114,975
20,000
11,000
%
-
-
-
-
*
All fees are inclusive of superannuation with any legislated increases in superannuation leading to a reduction in base salary if required. An individual
Non-executive Director may seek Australian Tax Office approval to be exempt from Superannuation payment as per relevant legislation.
** The Board Chair’s fee is inclusive of all Board and Committee responsibilities.
Table 8 – FY22 Non-executive director remuneration
Year
Base fee
Audit and Risk
Committee
People and
Remuneration
Committee
Sustainability
Committee
Other Superannuation
Total
R Cole Chair [1]
2021
119,862
15,512
2022
204,545
-
M Hine
A Atkins
A Hall
T Longstaff [2]
C Laslett [3]
2022
104,524
2021
105,000
2022
104,524
2021
105,000
2022
104,524
2021
2022
2021
2022
2021
2022
105,311
91,854
-
35,277
-
-
I Cochrane Former Chair [4]
2021
175,310
T Strapp Former NED [5]
2022
2021
-
52,459
2022
645,248
Total non-executive directors
2021
662,942
-
-
-
-
18,181
18,265
8,788
-
-
-
-
-
-
5,064
26,969
38,841
-
8,531
18,181
18,265
5,000
10,046
5,000
-
-
-
-
-
-
-
-
-
28,181
36,842
-
-
5,000
-
5,000
-
-
-
9,090
-
-
-
-
-
-
-
19,090
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
9,670
-
20,455
225,000
13,671
157,576
12,770
140,475
11,710
134,975
11,452
125,976
10,929
125,975
12,770
140,475
11,740
135,316
10,973
120,705
-
-
3,528
38,805
-
-
-
-
16,654
191,964
-
-
5,465
72,658
71,948
791,436
-
9,670
70,169
818,464
Notes
All movements in relation to which Committees each Board member is included on along with the date of appointment if within the year is included in Section 2 of the
Remuneration Report.
[1] Robert Cole was appointed as Chair of the Board on 8 May 2021. Prior to this was Deputy Chair of the Board and continued to receive Committee fees for
the Audit and Risk and People and Remuneration Committees.
[2] Timothy Longstaff was appointed to the Board on 16 August 2021 and was appointed Chair of the Sustainability Committee on 01 January 2022.
[3] Craig Laslett was appointed to the Board on 28 February 2022.
[4]
[5] Terry Strapp retired from the Board on 31 December 2020. Terry Strapp received a gift on retirement (other).
Ian Cochrane served as Chair of the Board until he resigned on 8 May 2021.
83
PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT REMUNERATION REPORT (CONTINUED)
10. Additional Statutory Information
This section provides details of any additional statutory disclosures that have not been included in the previous sections of the
Remuneration Report. There have been no alterations to the terms and conditions of the prior year Rights grants during the
financial year.
(a) Executive KMP equity awards
Reconciliation of rights held by KMP
Table 9 below shows a reconciliation of rights held by each KMP from the beginning to the end of 30 June 2022.
Table 9 – Executive rights held by KMP
Executive -
Grant Date
M Norwell
Instrument
28 February 2019
Performance Right - TSR
28 February 2019
Performance Right - ROACE
28 November 2019 Performance Right - TSR
28 November 2019 Performance Right - ROACE
10 November 2020 Short Term Incentive Rights
28 May 2021
28 May 2021
Performance Right - TSR
Performance Right - ROACE
8 October 2021
Short Term Incentive Rights
AGM FY22*
AGM FY22*
AGM FY22*
AGM FY22*
P Bryant
Performance Right - TSR
Performance Right - ROE
Performance Right - Strategic
Objective 1
Performance Right - Strategic
Objective 2
28 February 2019
Performance Right - TSR
28 February 2019
Performance Right - ROACE
28 November 2019 Performance Right - TSR
28 November 2019 Performance Right - ROACE
10 November 2020 Short Term Incentive Rights
28 May 2021
28 May 2021
Performance Right - TSR
Performance Right - ROACE
8 October 2021
Short Term Incentive Rights
13 May 2022
13 May 2022
Performance Right - TSR
Performance Right - ROE
Performance Right - Strategic
Objective 1
Performance Right - Strategic
Objective 2
13 May 2022
13 May 2022
P Muller
Holding
at 01 July
2021
Rights
Granted in
FY22
Vested
Forfeited
Number % Number %
Holding
at 30 June
2022
Anticipated
vesting
date
Fair Value
per right at
grant date
-
- 324,543 100
198,332 61
126,212 39
-
-
August 2021
August 2021
324,543
324,544
284,091
284,091
68,566
425,614
425,613
-
-
-
-
-
134,888
134,889
118,075
118,076
35,675
158,167
158,167
-
-
-
-
-
-
-
271,246
*
*
*
*
-
-
-
-
-
-
-
-
-
-
-
-
88,696
310,559
186,335
62,112
62,112
-
-
-
-
68,566 100
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
35,675 100
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
284,091
August 2022
284,091
August 2022
- November 2021
425,614
August 2023
425,613
August 2023
271,246 October 2022
-
-
August 2024
August 2024
-
August 2024
$0.65
-
August 2024
$0.65
118,075
August 2022
118,076
August 2022
- October 2021
158,167
August 2023
158,167
August 2023
88,696 October 2022
310,559
August 2024
186,335
August 2024
62,112
August 2024
$0.65
62,112
August 2024
$0.65
-
- 134,888 100
82,432 61
52,457 39
-
-
August 2021
August 2021
-
-
196,501 100
120,084 61
76,417 39
-
-
August 2021
August 2021
28 February 2019
Performance Right - TSR
28 February 2019
Performance Right - ROACE
28 November 2019 Performance Right - TSR
28 November 2019 Performance Right - ROACE
10 November 2020 Short Term Incentive Rights
28 May 2021
28 May 2021
Performance Right - TSR
Performance Right - ROACE
8 October 2021
Short Term Incentive Rights
13 May 2022
13 May 2022
Performance Right - TSR
Performance Right - ROE
13 May 2022
13 May 2022
Performance Right - Strategic
Objective 1
Performance Right - Strategic
Objective 2
196,501
196,501
172,008
172,008
60,042
232,937
232,937
-
-
-
-
-
-
-
-
-
-
-
-
372,743
533,940
320,364
106,788
106,788
-
-
-
-
60,042 100
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
172,008
August 2022
172,008
August 2022
- October 2021
232,937
August 2023
232,937
August 2023
372,743 October 2022
533,940
August 2024
320,364
August 2024
106,788
August 2024
$0.65
106,788
August 2024
$0.65
$1.22
$1.60
$1.33
$1.78
$1.06
$0.21
$0.54
$0.90
$0.45
$0.65
$1.22
$1.60
$1.33
$1.78
$1.06
$0.21
$0.54
$0.90
$0.45
$0.65
$1.22
$1.60
$1.33
$1.78
$1.06
$0.21
$0.54
$0.90
$0.45
$0.65
* Mark Norwell was provided with 1,969,831 Performance rights during the period. These rights are subject to shareholder approval at the FY22 Annual General
Meeting and will be granted if approved at that time.
1,125,209 STI Rights relating to FY22 STI outcomes that are to be granted to current Executive KMP’s post 30 June 2022
have not been included in the above table.
Details of rights over ordinary shares in the Company provided as remuneration to Executive KMP are set out above.
On vesting, each right is convertible into one ordinary share of Perenti Global Limited. Further information on the rights
is set out in note 19 to the financial statements.
84
FINANCIAL REPORTABN 95 009 211 474DIRECTORS’ REPORT
REMUNERATION REPORT (CONTINUED)
10. Additional Statutory Information (continued)
(b) Shareholdings of KMP
The number of ordinary shares in Perenti held directly, indirectly or beneficially by each individual (including shares held in
the name of the spouse, superannuation fund, nominee and/or other controlled entities) as at 30 June 2022 are shown in
Table 10 below.
Table 10 – Shareholdings of KMP
Name
DIRECTORS
R Cole
M Hine
A Atkins
A Hall
T Longstaff
C Laslett
EXECUTIVE
M Norwell
P Bryant
P Muller
Balance at start of
year
Received on
vesting of rights
Other changes during the year
Purchase of Shares
DRP Shares
Balance at
end of year
99,831
121,771
40,774
90,000
-
-
262,058
281,110
671,123
-
-
-
-
-
-
266,898
118,107
180,126
150,000
19,480
25,392
52,500
100,000
1,000
-
-
-
-
3,749
-
-
-
-
-
-
-
249,831
145,000
66,166
142,500
100,000
1,000
528,956
399,217
851,249
None of the shares above are held nominally by the directors or any of the other key management personnel.
(c) Prohibition on hedging of Perenti shares and unvested equity awards
The Company’s Securities Trading Policy imposes trading restrictions on all employees of the Company and its related
companies with “inside information” or with respect to derivative products and on trading securities during trading
prohibition periods.
(d) Loans to KMP
Loans to key management personnel were made on normal terms and conditions. The loans on acquisition of the Barminco
group are repayable by 22 October 2022. Interest was payable at the rate of 4.52% on loans advanced. Outstanding
balances are unsecured and are repayable in cash.
Loans to key management personnel
Beginning of the period
Interest charged
Interest received
End of period
(e) Other transactions with entities associated with KMP
There were no other transactions with related parties.
22
$
186,039
8,492
(8,492)
21
$
187,512
8,964
(10,437)
186,039
186,039
This Remuneration Report was approved by the Board on 22 August 2022 and has been signed in accordance with a
resolution of the Directors made pursuant to section 298(2) of the Corporations Act 2001 (Cth).
85
PERENTI – ANNUAL REPORT 2022 DIRECTORS’ REPORT
DIRECTORS’ REPORT
SHARE RIGHTS
Unissued share rights over ordinary shares of Perenti Global Limited at the date of this report are:
Date rights granted
28 November 2019
28 November 2019
9 April 2021
9 April 2021
28 May 2021
28 May 2021
8 October 2021
13 May 2022
13 May 2022
9 June 2022
Performance period
end date
Fair value
per right
30 June 2022
30 June 2022
30 June 2023
30 June 2023
30 June 2023
30 June 2023
30 June 2021
30 June 2024
30 June 2024
31 December 2023
$1.78
$1.33
$0.62
$0.99
$0.21
$0.54
$0.90
$0.45
$0.65
$0.71
Number
1,583,382
1,583,371
1,515,716
1,515,697
1,101,803
1,101,801
988,477
5,523,961
5,523,962
3,240,473
23,678,643
Note 19 to the financial statements has information relating to the valuation techniques used to value the rights.
SHARES ISSUED ON THE EXERCISE OF RIGHTS
The following ordinary shares of Perenti Global Limited were issued during the year ended 30 June 2022 on the exercise of
rights granted under the Employee Rights Plan. No further shares have been issued since that date. No amounts are unpaid on
any of the shares.
Date shares issued
6 September 2021
6 September 2021
6 September 2021
9 November 2021
Fair value
per right
Number of
shares issued
$1.60
$1.60
$1.23
$1.06
198,332
330,812
602,187
284,641
1,415,972
INDEMNIFICATION
• Under the Company’s constitution and subject to section 199A of the Corporations Act 2001, the Company indemnifies each
of the directors, the company secretary and every other person who is an officer of the Company and its wholly-owned
subsidiaries against:
• any liability incurred as an officer of the Company (as the case may be) by that person to any person other than the Company or
a related body corporate of the Company, unless that liability arises out of conduct involving a lack of good faith or is a liability
for a pecuniary penalty order under certain provisions of the Corporations Act 2001; and
• costs and expenses incurred in defending civil or criminal proceedings subject to certain conditions.
The above indemnity is a continuing indemnity and applies in respect of all acts done by a person while an officer of the Company
or its wholly-owned subsidiaries even though the person is not an officer at the time the claim is made.
The Company has entered into a Deed of Indemnity, Access and Insurance (“Deed”) with each current and former officer of the
Company and its subsidiaries, including each director and company secretary and persons who previously held those roles. Under
each Deed, to the extent permitted by law and to the extent and in the amount that the officer is not indemnified under any other
indemnity, including an indemnity contained in any insurance policy, the Company indemnifies the relevant officer against all
liabilities of any kind (including liabilities for legal expenses) incurred by the officer arising out of:
•
•
the discharge of his or her duties as an officer of the Company or a subsidiary of the Company, or as an officer of any
corporation in which the Company holds securities (“Related Corporation”) where the officer is representing the interests of the
Company in relation to the Related Corporation; and
the conduct of the business of the Company or a subsidiary of the Company, or a Related Corporation where the officer is
representing the interests of the Company in relation to that Related Corporation.
No amount has been paid under any of these indemnities during the financial year under review.
86
FINANCIAL REPORTABN 95 009 211 474 DIRECTORS’ REPORT
INSURANCE OF OFFICERS
During the financial year, the Company has paid a premium in respect of insuring the directors and officers of the Company and the
Group. The insurance contract prohibits disclosure of the premium or the nature of liabilities insured against under the policy.
NON-AUDIT SERVICES
The Company may decide to employ the auditor on assignments additional to their statutory audit duties where the auditor’s
expertise and experience with the Company and/or the Group are important.
Details of the amounts paid or payable to the auditor (PwC) for audit and non-audit services provided during the year are set out in
note 20 to the financial statements.
The Board have considered the position and, in accordance with advice received from the Audit and Risk Committee, is satisfied
that the provision of the non-audit services is compatible with the general standard of independence for auditors imposed by the
Corporations Act 2001. The directors are satisfied that the provision of non-audit services by the auditor did not compromise the
auditor independence requirements of the Corporations Act 2001 for the following reasons:
• all non-audit services have been reviewed by the Audit and Risk Committee to ensure they do not impact the impartiality and
objectivity of the auditor; and
• none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics
for Professional Accountants.
During the year the following non-audit fees were paid for services provided by the auditor of the parent entity, its related practices
and non-related audit firms:
Other assurance services
PricewaterhouseCoopers firm:
Advisory and accounting consulting services
Non PricewaterhouseCoopers firms:
Advisory and accounting consulting services
Total remuneration for other assurance services
Taxation services
PricewaterhouseCoopers firm:
Taxation services
Non PricewaterhouseCoopers firms:
Taxation services
Total remuneration for taxation services
Other services
Total remuneration for non-audit services
AUDITOR’S INDEPENDENCE DECLARATION
22
$
21
$
481,157
587,452
328,239
809,396
636,235
1,223,687
739,889
734,843
166,258
906,147
165,963
900,806
1,715,543
2,124,493
The auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 88.
ROUNDING OF AMOUNTS
The Company is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the ‘rounding off’ of amounts in the
directors’ report. Amounts in the directors’ report have been rounded off, in accordance with the instrument, to the nearest
thousand dollars, or in certain cases, to the nearest dollar.
This report is made in accordance with a resolution of directors.
Mark Norwell
Managing Director & Chief Executive Officer
Perth
22 August 2022
87
PERENTI – ANNUAL REPORT 2022 AUDITOR’S INDEPENDENCE DECLARATION
88
FINANCIAL REPORTABN 95 009 211 474 CORPORATE GOVERNANCE STATEMENT
The Company’s 2022 Corporate Governance Statement outlines the Company’s current corporate governance framework,
by reference to the ASX Recommendations.
The Corporate Governance Statement is current as at 22 August 2022 and has been approved by the Board.
The statement can be found in the corporate governance section of the Company’s website at perentigroup.com. The related ASX
Appendix 4G, a checklist cross-referencing the ASX Recommendations to disclosures in the Corporate Governance Statement and
the 2022 Annual Report can be found under the ASX Announcements section of the Company’s website at perentigroup.com.
OUR GOVERNANCE FR AMEWORK
BOARD
Responsible for overseeing the performance and operations of the Company
Robert Cole
Independent,
Non-executive
Chair
Mark Norwell
Managing
Director and
Chief Executive
Officer
Mark Hine
Independent,
Non-executive
director
Alexandra Atkins
Independent,
Non-executive
director
Andrea Hall
Independent,
Non-executive
director
Timothy Longstaff
Independent,
Non-executive
director
Craig Laslett
Independent,
Non-executive
director
BOARD COMMIT TEES
Assist the Board to discharge its responsibilities:
Audit and Risk
People and Remuneration
Sustainability Committee
Nomination Committee
Below is the list of the Company’s core governance framework documents.
These documents are located on the Company’s website.
Charters
Board Charter
Audit and Risk
Committee Charter
People and
Remuneration
Committee Charter
Sustainability
Committee Charter
Nomination Committee
Charter
Corporate Governance Policies
Market Disclosure and
Communication Policy
Sustainability Policy
Health, Safety and
Environment Policy
Anti-Bribery and
Anti-Corruption Policy
and Standard
Risk and Opportunity
Management Policy
Securities Trading Policy
Code of Conduct Policy
and Booklet
Inclusion and Diversity Policy
Speak-Up Policy and
Speak-Up Standards
Quality Policy
Human Rights Policy
Eliminating Sexual Harassment
Position Statement
89
PERENTI – ANNUAL REPORT 2022 CONSOLIDATED STATEMENT OF PROFIT OR LOSS
For the year ended 30 June 2022
Revenue
Other income
Materials expense
Labour costs
Rental and hire expense
Depreciation expense
Amortisation expense
Finance costs
Finance income
Other expenses from ordinary activities
Impairment of assets
Profit/(loss) before income tax
Income tax expense
Profit/(loss) for the year
Profit/(loss) is attributable to:
Equity holders of Perenti Global Limited
Non-controlling interests
Profit/(loss) for the year
Earnings/(loss) per share for profit attributable to the ordinary equity holders of
the Company:
Basic earnings/(loss) per share
Diluted earnings/(loss) per share
22
$’000
21
$’000
2,437,656
2,087,542
47,251
(734,512)
(1,037,993)
(45,306)
(250,120)
(29,042)
(56,316)
397
(238,531)
(23,162)
70,322
(27,836)
42,486
40,658
1,828
42,486
Cents
5.8
5.7
9,091
(628,091)
(875,850)
(18,177)
(222,230)
(39,303)
(63,452)
495
(227,656)
(70,563)
(48,194)
(4,109)
(52,303)
(55,140)
2,837
(52,303)
Cents
(7.8)
(7.8)
Notes
2
4(a)
4(b)
4(b)
4(b)
4(b)
4(b)
4(b)
5
21
21
The above consolidated statement of profit or loss should be read in conjunction with the accompanying notes.
90
FINANCIAL REPORTABN 95 009 211 474FINANCIAL STATEMENTS CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 June 2022
Profit/(loss) for the year
Other comprehensive loss
Items that may be reclassified to profit or loss
Notes
22
$’000
21
$’000
42,486
(52,303)
Exchange losses on translation of foreign operations
8(b)
(26,497)
Exchange gains/(losses) on translation of foreign operations -
non-controlling interest
Items that will not be reclassified to profit or loss
Loss on revaluation of land and buildings, net of tax
Gain on revaluation of FVOCI financial assets, net of tax
Other comprehensive loss for the year, net of tax
Total comprehensive income/(loss) for the year
Total comprehensive income/(loss) for the year is attributable to:
Equity holders of Perenti Global Limited
Non-controlling interests
Total comprehensive income/(loss) for the year
8(b)
8(b)
1,185
-
21,762
(3,550)
38,936
35,923
3,013
38,936
(680)
(508)
(175)
1,333
(30)
(52,333)
(54,662)
2,329
(52,333)
The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
91
PERENTI – ANNUAL REPORT 2022 FINANCIAL STATEMENTS CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2022
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Current tax receivables
Assets classified as held for sale
Total current assets
Non-current assets
Receivables
Financial assets at fair value through other comprehensive income
Property, plant and equipment
Right-of-use assets
Intangible assets
Deferred tax assets
Total non-current assets
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Borrowings
Lease liabilities
Current tax liabilities
Employee benefit obligations
Total current liabilities
Non-current liabilities
Borrowings
Lease liabilities
Deferred tax liabilities
Employee benefit obligations
Provisions
Total non-current liabilities
Total liabilities
Net assets
EQUITY
Contributed equity
Other reserves
Retained earnings
Capital and reserves attributable to owners of Perenti Global Limited
Non-controlling interests
Total equity
22
$’000
21
Restated*
$’000
Notes
9(c)
6(a)
7(a)
7(b)
6(a)
6(b)
7(c)
7(d)
7(e)
5(g)
6(c)
6(d)
7(d)
7(f)
6(d)
7(d)
5(g)
7(f)
8(a)
8(b)
348,519
391,101
212,119
12,546
7,488
971,773
9,430
-
926,320
59,305
652,207
170,239
264,741
325,893
214,411
10,545
28,894
844,484
4,889
25,536
716,667
74,691
678,814
147,741
1,817,501
1,648,338
2,789,274
2,492,822
393,298
2,172
27,943
15,002
79,722
518,137
260,311
3,268
24,537
14,659
70,719
373,494
843,492
690,923
28,250
72,240
4,263
532
49,272
78,135
2,870
65
948,777
821,265
1,466,914
1,194,759
1,322,360
1,298,063
1,137,030
(56,027)
230,937
1,311,940
10,420
1,137,783
(10,594)
160,986
1,288,175
9,888
1,322,360
1,298,063
* See note 25(a) for details regarding the restatement as a result of a change in accounting policy.
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
92
FINANCIAL REPORTABN 95 009 211 474FINANCIAL STATEMENTS CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2022
Attributable to owners of Perenti Global Limited
Notes
Contributed
equity
Other
reserves
Retained
earnings
$’000
$’000
$’000
Non-
controlling
interests
$’000
Total
$’000
Total
equity
$’000
Balance at 1 July 2020
1,135,323
(11,104)
270,039
1,394,258
5,496
1,399,754
(Loss)/profit for the year
Other comprehensive income/(loss)
Total comprehensive (loss)/income
for the year
Transactions with owners in their
capacity as owners:
Issue of ordinary shares as part of
dividend reinvestment plan, net of
transaction costs and tax
Shares issued on conversion of
employee share options/rights
Deferred tax movement on
capital raising costs
Capital contribution from
non-controlling interests
Dividends paid/payable
Employee share options/rights -
value of employee services
-
-
-
-
478
(55,140)
-
(55,140)
478
2,837
(508)
(52,303)
(30)
478
(55,140)
(54,662)
2,329
(52,333)
962
-
2,082
(2,001)
(584)
-
-
-
2,460
-
-
-
2,033
32
-
-
-
-
(49,270)
-
(49,270)
962
81
(584)
-
(49,270)
2,033
(46,778)
-
-
-
2,063
-
-
2,063
962
81
(584)
2,063
(49,270)
2,033
(44,715)
12(b)
Balance at 30 June 2021
1,137,783
(10,594)
165,629
1,292,818
9,888
1,302,706
Balance at 1 July 2021 as originally
presented
Prior year adjustment Software-as-a-
Service - Intangible
Restated total equity at 1 July 2021
Profit for the year
Other comprehensive income
Total comprehensive income for the
year
Transfer from financial assets at FVOCI
reserve to retained earnings
Asset revaluation reserve gain taken to
retained earnings on sale of asset
Vested employee share rights that have
lapsed, been cancelled or forfeited
Transactions with owners in their
capacity as owners:
Dividends paid
Buy-back of ordinary shares, net of tax
Dividends paid to non-controlling
interests
Deferred tax movement on capital
raising costs
Employee share rights - value of
employee services
Shares issued on conversion of
employee share rights
Capital contribution from
non-controlling interests
1,137,783
(10,594)
165,629
1,292,818
9,888
1,302,706
-
-
(4,643)
(4,643)
-
(4,643)
1,137,783
-
-
(10,594)
-
(4,735)
160,986
40,658
-
1,288,175
40,658
(4,735)
9,888
1,828
1,185
1,298,063
42,486
(3,550)
(4,735)
40,658
35,923
3,013
38,936
-
-
-
-
-
(2,057)
-
(584)
(29,474)
29,474
(11,998)
11,998
(1,929)
1,929
-
-
-
-
-
-
-
-
-
-
-
(14,108)
(2,057)
12(b)(i)
12(c)
8(a)
19(c)
-
4,591
8(a), 8(b)
1,888
(1,888)
(14,108)
-
(14,108)
(2,057)
-
-
-
-
-
-
-
-
-
(2,665)
(2,665)
(584)
4,591
-
-
-
-
(584)
4,591
-
-
(753)
-
2,703
-
(14,108)
-
(12,158)
184
(2,481)
184
(14,639)
Balance at 30 June 2022
1,137,030
(56,027)
230,937
1,311,940
10,420
1,322,360
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
93
PERENTI – ANNUAL REPORT 2022 FINANCIAL STATEMENTS CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 30 June 2022
Cash flows from operating activities
Receipts from customers (inclusive of goods and services tax)
Payments to suppliers and employees (inclusive of goods and services tax)
22
$’000
21
$’000
Notes
2,515,724
2,214,811
(2,056,808)
(1,818,019)
458,916
396,792
Interest received
Insurance recovery
Interest and other costs of finance paid
Income taxes paid
Net cash inflow from operating activities
9(a)
Cash flows from investing activities
Payments for property, plant, equipment and intangibles
Proceeds from sale of property, plant and equipment
Proceeds from sale of assets at FVOCI
Proceeds from sale of businesses
Proceeds from sale of assets held for sale
Payments for purchase of subsidiaries
Cash removed on disposal of subsidiary
Cash acquired on acquisition of subsidiary
Repayment of loan by non-controlling interest
Loan to non-controlling interest
Net cash outflow from investing activities
Cash flows from financing activities
Proceeds from borrowings
Repayment of borrowings
Redemption premium on 2022 High Yield Bonds
Payments of lease liabilities
Dividends paid
Dividends paid to non-controlling interest
Payments for borrowing costs
Transactions with non-controlling interest
Proceeds from issues of shares, net of transaction costs
Payments for shares bought back, net of transaction costs
Net cash inflow/(outflow) from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Effects of exchange rate changes on cash and cash equivalents
6(b)(iii)
7(b)
13
12(b)
Cash and cash equivalents at end of year
9(c)
Non-cash investing and financing activities (refer note 9(b))
397
-
(49,919)
(68,092)
341,302
(467,937)
26,715
56,625
46,186
31,158
(3,750)
(1,897)
493
609
-
495
2,124
(46,701)
(56,447)
296,263
(278,619)
85,400
-
-
-
(10,570)
-
1,785
-
(2,079)
(311,798)
(204,083)
310,926
(217,873)
-
(26,432)
(14,108)
(2,610)
(139)
(36)
-
(940)
675,752
(703,064)
(8,143)
(30,458)
(63,482)
-
(17,199)
2,063
81
-
48,788
(144,450)
78,292
264,741
5,486
348,519
(52,270)
327,491
(10,480)
264,741
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
94
FINANCIAL REPORTABN 95 009 211 474FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
Segment information
Revenue
Individually significant items
Other income and expense items
Income tax expense
Financial assets and financial liabilities
Non-financial assets and liabilities
Equity
Cash flow information
Critical accounting estimates and judgements
Financial risk management
Capital management
Business combination
Interests in other entities
Contingencies
Commitments
Events since the end of the financial year
Related party transactions
Share-based payments
Remuneration of auditors
Earnings per share
Assets pledged as security
Deed of cross guarantee
Parent entity financial information
Summary of significant accounting policies
96
100
101
102
103
107
113
124
126
127
128
132
133
134
135
135
135
136
137
139
140
141
142
144
146
95
PERENTI – ANNUAL REPORT 2022 1 SEGMENT INFORMATION
(a) Description of segments
Management has determined the operating segments based on the internal reports reviewed by the Managing Director that
are used to make strategic decisions. The Managing Director assesses the performance of the operating segments based on
Revenue and EBIT(A).
The operating segments are identified by the Managing Director based on the nature of the services provided. The Managing
Director considers the business from a geographic perspective, similarity of the services provided and the nature of risks and
returns associated with each business.
The reportable segments are:
Contract Mining - Surface
The provision of mining services including drilling and blasting, in-pit grade control, exploration drilling and earthmoving in
Australia and Africa.
Contract Mining - Underground
The provision of underground mining services in Australia, Africa and North America.
Mining Services and idoba
Mining support services including equipment hire, equipment parts and sales, supply of equipment, logistics services and
technology driven products and services. During the year ended 30 June 2022 the idoba group, Perenti’s technology entities,
were included in the Mining Services segment having been previously included in Corporate segment at 30 June 2021 to
better reflect how this business is reviewed by the Managing Director. The prior period comparatives have been reclassified to
reflect this change.
Corporate
This segment includes corporate activity covering strategy, treasury, accounting, human resources, information technology,
procurement, legal, risk and other corporate administration.
Intersegment eliminations
Represents transactions which are eliminated on consolidation.
Financing arrangements are managed at a group level and therefore net financing cost are not allocated to segments.
EBIT(A)
EBIT(A) is defined as earnings before finance costs, finance income, income tax expense or benefit and amortisation of
intangible assets.
96
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 1 SEGMENT INFORMATION (CONTINUED)
(b)
Segment information provided to the Managing Director
For the year ended
30 June 2022
Segment revenue
Contract Mining
Mining
Services
Inter-
segment
Surface Underground
and idoba Corporate
eliminations Consolidated
$’000
$’000
$’000
$’000
$’000
$’000
Sales to external customers
553,602
1,737,237
Intersegment sales
Total sales revenue
Timing of revenue recognition
- At a point in time
- Over time
-
538
146,817
32,472
553,602
1,737,775
179,289
1,455
-
79,159
552,147
1,737,775
100,130
553,602
1,737,775
179,289
-
-
-
-
-
-
-
2,437,656
(33,010)
-
(33,010)
2,437,656
(23,553)
57,061
(9,457)
2,380,595
(33,010)
2,437,656
Underlying segment EBIT(A)
30,153
184,614
13,151
(51,625)
Amortisation expense
Impairment of assets
(552)
-
Provisions relating to the exit from Mali
(11,619)
Transaction, restructuring costs and
other
Foreign exchange (loss)/gain, net
Gain on sale of businesses, net
(721)
(1,988)
-
(25,510)
(23,162)
-
34
2,068
-
Reported segment EBIT
15,273
138,044
(1,536)
(1,444)
-
-
(3,757)
97
25,643
33,598
-
-
(5,466)
(2,139)
-
(60,674)
-
-
-
-
-
-
-
-
176,293
(29,042)
(23,162)
(11,619)
(9,910)
(1,962)
25,643
126,241
397
(56,316)
70,322
(27,836)
42,486
(1,828)
40,658
Interest income
Interest expense
Profit before tax
Income tax expense
Profit for the year
Non-controlling interests
Profit for the year attributable to
members
Segment assets
Segment liabilities
Other segment information
Depreciation expense
Amortisation expense
Acquisition of property, plant
and equipment, intangibles and other
non-current assets
822,392
1,732,288
213,034
1,857,146
(1,835,586)
2,789,274
606,102
1,158,843
120,502
1,035,187
(1,453,720)
1,466,914
(65,429)
(162,998)
(552)
(25,510)
(18,313)
(1,536)
(3,380)
(1,444)
217,357
208,984
24,788
16,808
-
-
-
(250,120)
(29,042)
467,937
97
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 1 SEGMENT INFORMATION (CONTINUED)
(b)
Segment information provided to the Managing Director (continued)
For the year ended
30 June 2021
Restated
Segment revenue
Contract Mining
Surface Underground
Mining
Services
and idoba
Inter-
segment
Corporate
eliminations Consolidated
$’000
$’000
$’000
$’000
$’000
$’000
Sales to external customers
476,142
1,475,974
-
-
476,142
1,475,974
152,343
Intersegment sales
Total sales revenue
Timing of revenue recognition
- At a point in time
- Over time
Underlying segment EBIT(A)
Impairment of assets
Amortisation expense
Implementation of AMS strategic
review
Trade receivable provisions and
bad debts arising from AMS
strategic review
Provision for stock obsolescence
in BTP
2,050
474,092
476,142
-
1,475,974
1,475,974
12,173
(62,502)
200,372
-
(476)
(38,571)
(13,573)
(11,995)
-
-
-
-
135,391
16,952
52,781
99,562
152,343
11,686
(8,061)
(256)
-
-
(9,946)
(3,387)
35
-
35
-
35
35
(53,444)
-
-
-
-
-
3,338
Foreign exchange (loss)/gain, net
(2,108)
(4,995)
Transaction, restructuring costs
and other
104
(693)
(121)
(2,782)
Reported segment EBIT
(78,377)
156,113
(10,085)
(52,888)
Interest income
Interest expense
Loss before tax
Income tax expense
Loss for the year
Non-controlling interests
Loss for the year attributable to
members
-
2,087,542
(16,952)
-
(16,952)
2,087,542
(12,418)
42,413
(4,534)
2,045,129
(16,952)
2,087,542
-
-
-
-
-
-
-
-
-
170,787
(70,563)
(39,303)
(13,573)
(11,995)
(9,946)
(7,152)
(3,492)
14,763
495
(63,452)
(48,194)
(4,109)
(52,303)
(2,837)
(55,140)
Segment assets
Segment liabilities
603,290
394,870
1,590,870
927,130
192,735
214,535
1,698,433
(1,592,506)
2,492,822
791,698
(1,133,474)
1,194,759
Other segment information
Depreciation expense
Amortisation expense
Acquisition of property, plant and
equipment, intangibles and other
non-current assets
(60,785)
(476)
(137,902)
(38,571)
(19,738)
(256)
(3,805)
-
63,230
178,462
19,974
16,953
-
-
-
(222,230)
(39,303)
278,619
98
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 1 SEGMENT INFORMATION (CONTINUED)
(c) Geographical information
The table below provides information on the geographical location of revenue from contracts with customers and non-
current assets (other than deferred tax assets). Revenue and non-current assets are recorded in the applicable jurisdiction
based on location of operation. The revenue from external parties reported to the Managing Director is measured in a
manner consistent with that in the consolidated income statement. Non-current assets are allocated based on the location of
the operations and the physical location of the asset.
30 June 2022
30 June 2021
Restated
Total
segment
revenue
Inter-
segment
revenue
Revenue
from
external
customers
Non-
current
segment
assets
Total
segment
revenue
Inter-
segment
revenue
Revenue
from
external
customers
Non-
current
segment
assets
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Contract Mining - Surface
- Australia
- Ghana
- Senegal
- Burkina Faso
- Mali
- Botswana
- Other foreign
countries
196,831
164,489
79,883
68,223
23,607
20,533
36
Contract Mining - Underground
- Australia
- Ghana
834,462
272,450
- Burkina Faso
219,646
- Botswana
- Tanzania
- Canada
- Mali
- Egypt
- Other foreign
countries
145,184
114,397
95,516
-
56,120
-
Mining Services and idoba
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
196,831
129,576
185,118
164,489
138,700
79,883
68,223
23,607
47,084
34,887
-
20,533
100,882
36
17
834,462
349,343
272,450
227,667
219,646
226,393
114,397
95,516
-
56,120
76,307
94,885
16,807
25,180
598
75,811
68,368
63,536
83,222
-
87
689,628
247,604
214,979
77,954
98,967
59,308
-
87,186
-
25
348
(538)
144,646
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
185,118
113,422
75,811
68,368
63,536
83,222
-
87
689,628
247,604
214,979
77,954
98,967
59,308
-
87,186
95,048
52,451
38,209
2,783
-
-
368,654
221,791
242,060
51,891
93,616
3,871
27,028
12,720
348
-
- Australia
130,256
(6,027)
124,229
137,010
- Africa
49,033
(26,445)
22,588
- Other foreign
countries
Corporate
- Australia
- Other foreign
countries
-
-
-
-
-
-
-
-
-
283
22
41,596
-
114,162
37,847
(1,642)
(15,073)
112,520
22,774
334
(237)
35
-
-
-
97
35
-
116,453
421
73
59,878
228
Total
2,470,666
(33,010) 2,437,656 1,647,262
2,104,494
(16,952)
2,087,542
1,500,597
99
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 2 REVENUE
The Group derives the following types of revenue:
Revenue from Contracts with Customers
Contract mining services
Equipment rental
Mining supplies and manufactured goods (sale of goods)
Consulting services
(a) Revenue recognition
Notes
2(a)(i)
2(a)(ii)
2(a)(iii)
2(a)(iv)
22
$’000
21
$’000
2,321,584
1,992,925
42,827
57,061
16,184
2,437,656
43,268
42,413
8,936
2,087,542
Revenue is recognised for the major business activities using the methods outlined below.
(i) Contract mining services
Contract mining services include underground and surface mining, drill and blast, in-pit grade control, exploration drilling,
earthmoving, machinery rebuilds and mineral assays and analysis. The performance obligation is fulfilled over time as the
Group enhances mining assets which the customer controls and for which the Group has a right to payment for performance
to date and as such revenue is recognised over time. Revenue is recognised monthly based on units of production at agreed
contract rates that is aligned with the stand-alone selling prices for each performance obligation. The majority of the Group’s
revenue is paid one month in arrears and therefore gives rise to accrued revenue. The total transaction price for contract
services may include variable consideration.
(ii) Equipment rental
Rental income is recognised on either a straight-line or machine hours basis over the term of the operating lease.
(iii) Mining supplies and manufactured goods (sale of goods)
Revenue is recorded at a point in time when control has been transferred to the customer, generally being when the goods
have been dispatched or delivered to a customer pursuant to the sales order.
(iv) Consulting services
The Group provides operational improvement and technology consulting services to clients in the mining sector. Delivery of
these services represent performance obligations. Upon completion of each performance obligation, which is satisfied over
time, the Group is entitled to payment for the services performed.
Accounting policies
The Group recognises revenue when the Group satisfies performance obligations by transferring a promised good or service
to a customer. An asset is transferred when or as the customer obtains control of that asset.
Contract assets and liabilities
AASB 15 Revenue from Contracts with Customers uses the terms ‘contract asset’ and ‘contract liability’ to describe what
is commonly known as ‘accrued revenue’ and ‘deferred revenue’. Accrued revenue represents receivables for unbilled
completed services where the Group’s right to consideration is unconditional subject to only the passage of time. Deferred
revenue arises where payment is received prior to work being performed and is allocated to the performance obligations
within the contract and recognised as revenue over the course of the contract.
Variable consideration
AASB 15 Revenue from Contracts with Customers provides requirements for variable considerations such as claims, variations
and contract modifications. Where consideration in respect of a contract is variable, the expected value of revenue is only
recognised to the extent that it is highly probable that it will not result in a significant reversal. The estimate is based on all
available information including historic performance.
Contract fulfilment costs
Costs generally incurred prior to the commencement of a contract may arise due to mobilisation/site setup costs as these
costs are incurred to fulfil a contract. Where these costs are expected to be recovered, they are capitalised and amortised
over the contract consistent with the transfer of service to the customer. Where the costs, or a portion of these costs, are
reimbursed by the customer, the amount received is recognised as deferred revenue.
Financing components
The Group does not expect to have any contracts where the period between the transfer of the promised goods or services
to the customer and payment by the customer exceeds one year and/or which contain other material financing components.
Therefore, the Group does not adjust any of the transaction prices for the time value of money or other financing
components.
Warranties and defect periods
Contracts for sale of goods and services may include defect and warranty periods following completion of the sale or
project. These obligations are not deemed to be separate performance obligations and therefore are estimated and included
in the total costs of the contracts. Where required, amounts are recognised in accordance with AASB 137 Provisions,
Contingent Liabilities and Contingent Assets.
(b) Revenue recognised in relation to contract liabilities
The Group recognised revenue from the amortisation of deferred revenue liabilities related to mining services contracts.
Revenue recognised related to contract liabilities was $2,433,000 (2021: $1,751,000).
100
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 3
INDIVIDUALLY SIGNIFICANT ITEMS
The Group has identified a number of items which are material due to the significance of their nature and/or amount. These are
listed separately here to provide a better understanding of the financial performance of the Group.
Gain on sale of MinAnalytical business
Impairment of customer related intangibles
Impairment of property, plant and equipment
Impairment of inventory
Notes
3(b)
7(e)(ii)
3(a)
3(a)
22
$’000
29,630
(23,162)
-
-
6,468
21
$’000
-
-
(59,903)
(10,660)
(70,563)
(a)
Impairment of property, plant and equipment
For the year ended 30 June 2022, the Group assessed whether there were any indicators of impairment. The Company’s
market capitalisation at 30 June 2022 was below its net assets and management considered this factor amongst other
impairment indicators at 30 June 2022.
Indicators of impairment can exist at an individual asset level due to factors such as technical obsolescence, declining market
value, physical condition or saleability within a reasonable time frame. Other indicators of impairment can exist where there
is a deterioration of financial performance of cash-generating units (CGUs) against their respective budgets and forecasts.
Where indicators of impairment exist, the recoverable amount was determined by calculating the higher of fair value less cost
of disposal (FVLCD) and value in use (VIU).
At 30 June 2022 indicators of impairment existed for Contract Mining - Surface (Australia), Contract Mining - Surface (Africa)
and BTP Group CGUs. Recoverable amounts for plant and equipment within the CGUs were prepared using the FVLCD
method to assess whether impairments or reversal of previous impairments were required. The Group sourced independent
valuations at 30 June 2022 to support the FVLCD estimates required for each of the applicable CGUs.
Summary of the impairment taken, and method used to assess the impairment
The following table summarises the outcomes from impairment testing conducted across the Company’s material CGUs.
CGU
BTP Group
Indicator for
impairment testing
21
Y
22
Y
Contract Mining - Surface (Africa)
Contract Mining - Surface (Australia)
MinAnalytical
Contract Mining - Underground
(Australasia / Africa and North America)
Y
Y
N/A
Y
Y
Y
Y
N
Valuation method
used
Impairment expense/
(reversal) of PPE and
Inventory
22
FVLCD
FVLCD
FVLCD
N/A
VIU
21
FVLCD
FVLCD
FVLCD
FVLCD
N/A
22
-
-
-
-
-
21
$8.1m
$62.5m
-
-
-
Key assumptions used for fair value less costs of disposal
At 30 June 2022, the FVLCD methodology adopted for BTP Group, Contract Mining - Surface (Africa) and Contract Mining -
Surface (Australia), combined level 1, level 2, and predominately level 3 inputs in the fair value determination.
The main inputs used by the Group are the cost approach and the market approach. The cost approach considers the
replacement cost of a new item being appraised and then deducts the loss in value caused by physical deterioration,
functional or economic obsolescence. The market approach or sales comparison approach considers sales prices
(or offering prices) of property that is comparable.
At 30 June 2022 no impairment expense was recognised and no reversal of impairment was considered necessary.
In the prior period an impairment expense of $8.1 million was recorded against the BTP Group CGU’s plant and equipment
based on an independent valuation and an impairment expense of $62.5 million was recorded against the property, plant
and equipment and inventory of the Contract Mining - Surface (Africa) CGU. The impairment recorded in the prior period
for Contract Mining - Surface (Africa) CGU was based upon offers obtained for various items of equipment and a FVLCD
independent valuation obtained for the remaining fleet.
(b) Gain on sale of MinAnalytical business
The Group completed a divestment, effective 30 November 2021, of its ownership in its subsidiary MinAnalytical Laboratory
Services Australia Pty Ltd (‘MinAnalytical’). The total consideration for the transaction was $43.6 million in cash, comprised of
$39.0 million for shares in MinAnalytical plus $4.6 million for working capital. A gain of $29.6 million, net of transaction costs,
was recorded against other income in the consolidated statement of profit or loss. The sale of MinAnalytical did not represent
a separate major line of business and therefore has not been disclosed as a discontinued operation.
101
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 4 OTHER INCOME AND EXPENSE ITEMS
This note provides a breakdown of the items included in other income and an analysis of expenses by nature.
(a) Other income
Gain on sale of businesses, net
Other items
Traineeship grants
Gain on disposal of property, plant and equipment
Insurance proceeds
Total other income
(b) Breakdown of expenses by nature
Depreciation expense
Plant and equipment depreciation
Right-of-use asset depreciation
Buildings depreciation
Total depreciation expense
Amortisation expense
Customer relationships intangibles amortisation
Software amortisation
Total amortisation expense
Rental and hire expenses
Rental expense for equipment
Rental expense for properties
Total rental and hire expenses
Finance costs
Interest expense
Redemption premium on 2022 High Yield Bonds
Lease contracts interest
Amortisation of borrowing cost
Other finance costs
Total finance costs
Other expenses from ordinary activities
Staffing, safety and training
Consultants
Travel and accommodation
Freight
IT and communications
Insurance
Trade receivable provisions and bad debts
Duties and taxes
Property related expenses
Foreign exchange loss/(gain), net
All other expenses
Total other expenses from ordinary activities
Impairment of assets
Impairment of customer related intangibles
Impairment of property, plant and equipment
Impairment of inventory
Total impairment of assets
102
Notes
Notes
7(e)(i)
3
3
22
$’000
25,643
9,567
8,426
3,489
126
47,251
22
$’000
223,498
25,042
1,580
250,120
25,284
3,758
29,042
44,326
980
45,306
46,942
-
3,635
5,674
65
56,316
42,963
27,477
32,412
36,444
19,546
16,788
6,670
12,717
9,145
1,962
32,407
238,531
23,162
-
-
23,162
21
$’000
-
6,102
-
473
2,516
9,091
21
$’000
185,857
34,287
2,086
222,230
38,102
1,201
39,303
16,022
2,155
18,177
45,644
8,143
5,294
3,558
813
63,452
32,839
20,316
43,262
28,994
18,033
18,175
11,328
9,920
9,392
7,152
28,245
227,656
-
59,903
10,660
70,563
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 5
INCOME TAX EXPENSE
(a)
Income tax expense
Current income tax expense
Current tax on profits for the year
Adjustments for prior periods
Deferred income tax expense
Decrease/(increase) in deferred tax assets
Decrease in deferred tax liabilities
Income tax expense
(b)
Tax reconciliation
Notes
Profit/(loss) before tax
Income tax at the Australian tax rate of 30% (2021: 30%)
Non-Deductible items:
Share-based payments
Other foreign permanent differences
Withholding tax
Other assessable/non-deductible items
Difference in overseas tax rates
Adjustments for prior periods
Tax losses recognised
Movement in tax base due to effect of foreign currency translation
Deferred tax on undistributed profits of foreign subsidiaries and
joint ventures
Movement in uncertain tax positions
5(g)(ii)
Income tax expense
(c)
Amounts recognised directly in equity
Net gain on revaluation of financial assets at FVOCI
Deferred tax recognised in foreign currency translation reserve
Net gain on revaluation of land and buildings
Deferred tax movement on capital raising costs
Income tax benefit reported directly in statement of changes in equity
Notes
8(b)
8(b)
22
$’000
53,498
3,311
5,880
(34,853)
27,836
22
$’000
70,322
21,097
1,306
65
18,711
20,061
(5,641)
3,311
(20,037)
(12,279)
-
1,242
27,836
22
$’000
-
-
-
(584)
(584)
21
$’000
55,881
(19)
(34,255)
(17,498)
4,109
21
$’000
(48,194)
(14,458)
610
(386)
11,236
18,738
(5,818)
(19)
(6,159)
5,584
(6,317)
1,098
4,109
21
$’000
(571)
(1,483)
(448)
(584)
(3,086)
(d) Recognition and measurement
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to taxation authorities
at the tax rates and tax laws enacted to substantively enacted by the balance sheet date. Management periodically evaluates
positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation.
It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
103
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 5
INCOME TAX EXPENSE (CONTINUED)
(e)
Tax losses and temporary differences not recognised
(i)
Tax losses for which deferred tax assets have not been recognised:
Unused tax losses for which no deferred tax asset has been recognised
Unrecognised deferred tax assets relating to the above unused tax losses
22
$’000
85,997
25,571
21
$’000
172,241
51,139
Key Judgement: Unrecognised deferred tax asset
The Group reviews the carrying amount of its deferred tax assets at each balance date. At 30 June 2022 the Group has
unrecognised benefits relating to carried forward tax losses, which can only be offset against eligible future tax profits.
The Group has determined that there is sufficient future taxable profit in Australia to support the losses recognised but at
this stage it is not sufficient to support the above unrecognised losses relating predominantly to the African operations.
(ii) Temporary differences for which deferred tax liabilities have not been recognised:
Undistributed earnings
Unrecognised deferred tax liabilities relating to the above undistributed earnings
22
$’000
186,215
14,965
21
$’000
244,543
22,054
The Group has undistributed earnings of $186,215,000 (2021: $244,543,000) in some of its overseas subsidiaries which,
if paid out as dividends, would attract dividend withholding tax. An assessable temporary difference exists, but no deferred
tax liability has been recognised as the parent entity is able to control the timing of distributions from the subsidiary.
(f)
Effective tax rates for the year ended 30 June 2022 for Australian and Group operations
Australian operations
(i)
The statutory effective tax rate for the year ended 30 June 2022 for the Australian operations is 43.5% (30 June 2021: 37.1%).
This rate is higher than the Australian corporate income tax rate of 30% due to the impact of functional currencies, income/
expenditure which are not assessable/deductible for tax, recognition of previously unrecognised tax losses and transfer
pricing adjustments. The statutory effective tax rate excluding the impact of these items is 30.0% (30 June 2021: 30.0%).
(ii) Group operations
The statutory effective tax rate for the year ended 30 June 2022 for the global operations is 39.6% (30 June 2021: (8.5%)).
This rate is higher than the Australian corporate tax rate of 30% due to the impact of dividend withholding tax incurred,
functional currencies, items of income/expenditure which are not assessable/deductible for tax, recognition of previously
unrecognised tax losses and transfer pricing adjustments. The statutory effective tax rate excluding the impact of these items
is 30.0% (30 June 2021: 30.0%).
104
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 5
INCOME TAX EXPENSE/(BENEFIT) (CONTINUED)
Notes
(g) Deferred tax balances
(i) Deferred tax assets
Deferred income tax relates to the following:
Employee benefits
Accruals
Provision for obsolete stock
Doubtful debts
Depreciation
Right-of-use assets
Inventory
Borrowing and business expenses
Unrealised foreign exchange
Current/prior year tax losses recognised
Financial assets
R&D tax offset recognised
Deferred tax assets
Set off deferred tax liabilities pursuant to set-off provisions
5(g)(ii)
Net deferred tax assets
Deferred tax assets expected to be recovered within 12 months
Deferred tax assets expected to be recovered after more than 12 months
22
$’000
28,884
9,119
1,203
564
8,145
12,959
67
3,233
2,156
146,059
446
4,999
217,834
(47,595)
170,239
74,345
143,489
217,834
21
$’000
24,999
5,500
1,828
2,444
10,819
14,683
2,262
5,052
-
151,710
-
4,999
224,296
(76,555)
147,741
64,023
160,273
224,296
All movements charged/credited through profit or loss except for an amount of $584,000 (2021: $2,638,000) which was
charged directly to equity.
(ii) Deferred tax liabilities
Notes
Deferred income tax relates to the following:
Depreciation
Intangibles - customer relationships
Revaluation of land and buildings
Right-of-use assets
Unrealised foreign exchange
Uncertain tax positions
Financial assets at fair value through profit or loss
Other
Deferred tax liabilities
Adjustment of deferred tax liabilities pursuant to set-off provisions
5(g)(i)
Net deferred tax liabilities
Deferred tax liabilities expected to be settled within 12 months
Deferred tax liabilities expected to be settled after more than 12 months
22
$’000
18,606
50,407
6,486
11,946
-
32,175
-
215
21
$’000
25,599
64,944
6,486
13,692
9,855
30,933
2,926
255
119,835
154,690
(47,595)
72,240
13,503
106,332
119,835
(76,555)
78,135
25,937
128,753
154,690
All movements charged/credited through profit or loss, no amounts were charged directly to equity (2021: $448,000).
105
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 5
INCOME TAX EXPENSE (CONTINUED)
(g) Deferred tax balances (continued)
Uncertain tax positions
The Group is subject to income taxes across a number of global jurisdictions and therefore significant judgement is required
when determining the provision for income taxes on a worldwide basis. There are some transactions and calculations
undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. The Company
recognises liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Where the
final tax outcome of these matters is different from amounts provided, such differences will impact the current and deferred
tax provisions in the period in which such outcome is obtained. In addition, the Company regularly assesses the recognition
and recoverability of deferred tax assets. This requires judgements about the application of income tax legislation in
jurisdictions in which Perenti operates. Changes in circumstances may alter expectations and affect the carrying amount of
deferred tax assets.
Offsetting deferred tax balances
Deferred tax assets and liabilities are offset where there is a legally enforceable right to offset current tax assets and liabilities
and where the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset
where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset
and settle the liability simultaneously.
106
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 6 FINANCIAL ASSETS AND FINANCIAL LIABILITIES
(a)
Trade and other receivables
Trade receivables (i)
Accrued revenue
Provision for impairment and expected
credit losses (see note 11(b))
Net GST / VAT receivables
Other receivables (ii)
Prepayments
22
Current
Non-
current
Total
Current
Non-
current
21
Total
$’000
$’000
$’000
$’000
$’000
$’000
97,525
206,235
(10,980)
292,780
42,820
6,232
49,269
-
-
-
-
-
8,921
509
97,525
125,660
206,235
157,753
(10,980)
(13,097)
292,780
270,316
42,820
15,153
49,778
29,680
6,681
19,216
-
-
-
-
-
4,220
669
125,660
157,753
(13,097)
270,316
29,680
10,901
19,885
391,101
9,430
400,531
325,893
4,889
330,782
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost, less provision for
impairment and loss allowance.
(i) Classification as trade and other receivables
Trade receivables are amounts due from customers for goods sold or services performed in the ordinary course of business.
If collection of the amounts is expected in one year or less they are classified as current assets. If not, they are presented as
non-current assets. Trade receivables are generally due for settlement not more than 90 days from the date of recognition
and therefore are all classified as current. Due to the short-term nature of these receivables, their carrying amount is assumed
to be the same as their fair value. For non-current receivables, the fair values are also not significantly different to their
carrying amounts. The Group’s impairment loss allowance, the credit quality and the Group’s exposure to credit risk, foreign
currency risk and interest rate risk can be found in note 11(a) and 11(b).
(ii) Other receivables
This amount includes operating expense rebates and other receivables. If collection of other receivables is expected in one
year or less they are classified as current assets.
(b)
Financial assets at fair value through other comprehensive income
During the year ended 30 June 2022 the Group divested of all its equity holdings.
Non-current assets
Listed securities
Equity securities
Unlisted securities
Equity securities
22
$’000
-
-
-
21
$’000
7,386
18,150
25,536
107
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 6 FINANCIAL ASSETS AND FINANCIAL LIABILITIES (CONTINUED)
(b)
Financial assets at fair value through other comprehensive income (continued)
Accounting policies
Classification
The Group classifies its investments in the following categories:
•
loans and receivables measured at amortised cost, and
• financial assets at fair value through other comprehensive income (FVOCI).
The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the
cash flows.
Measurement
At initial recognition, the Group measures a financial asset at its fair value plus transaction costs that are directly attributable
to the acquisition of the financial asset. The Group subsequently measures all equity investments at fair value. Where the
Group has elected to present fair value gains and losses on equity investments in OCI, there is no subsequent reclassification
of fair value gains and losses to profit or loss following the derecognition of the investment. Dividends from such investments
continue to be recognised in profit or loss as other income when the Group’s right to receive payments is established.
Loans and receivables are carried at amortised cost using the effective interest method.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an
active market. They arise when the Group provides money, goods or services directly to a debtor with no intention of selling
the receivable. They are included in current assets, except for those with maturities greater than 12 months after statement
of financial position date which are classified as non-current assets. Loans and receivables are included in trade and other
receivables (note 6(a)).
Financial assets at fair value through other comprehensive income (FVOCI)
The Group subsequently measures all equity investments at fair value. Where the Group’s management has elected to
present fair value gains and losses on equity investments in OCI, there is no subsequent reclassification of fair value gains
and losses to profit or loss following the derecognition of the investment. Dividends from such investments continue to be
recognised in profit or loss as other income when the Group’s right to receive payments is established. Impairment losses
(and reversal of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes
in fair value.
Financial assets - recognition and derecognition
Purchases and sales of financial assets are recognised on trade date, being the date on which the Group commits to purchase
or sell the asset. Financial assets are derecognised when the rights to receive cash flows from the financial assets have
expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership.
Impairment
The Group assesses on a forward-looking basis the expected credit losses associated with its debt instruments carried at
FVOCI. The impairment methodology applied depends on whether there has been a significant increase in credit risk. For
trade receivables, the Group applies the simplified approach permitted by AASB 9, which requires expected lifetime losses to
be recognised from initial recognition of the receivables, refer to note 11 for further detail.
(i) Classification of financial assets at fair value through other comprehensive income
Financial assets at fair value through other comprehensive income (FVOCI) comprise:
Equity securities which are not held for trading, and which the group has irrevocably elected at initial recognition to recognise
in this category. These are strategic investments and the Group considers this classification to be more relevant.
On disposal of these equity investments, any related balance within the fair value reserve will be transferred to retained
earnings.
108
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 6 FINANCIAL ASSETS AND FINANCIAL LIABILITIES (CONTINUED)
(b)
Financial assets at fair value through other comprehensive income (continued)
(ii) Amounts recognised in other comprehensive income
During the year, the following gains were recognised in other comprehensive income.
Gains recognised in other comprehensive income, gross
Notes
8(b)
22
$’000
31,089
21
$’000
1,904
(iii) Disposal of financial assets at fair value through other comprehensive income during the year
In line with the Perenti Group strategy to divest non-core assets the entire portfolio of both listed and unlisted financial assets
at FVOCI were sold during the year ended 30 June 2022. The sale resulted in cash consideration before costs of $56.6 million
and a transfer from financial assets at FVOCI reserve to retained earnings of $29.5 million in the statement of changes in
equity.
(c)
Trade and other payables
Trade payables
Accrued expenses
Payroll accruals
Net GST / VAT payables
Contract liabilities (i)
Accrued bond interest
Other creditors and accruals
22
$’000
202,350
104,353
55,964
8,457
3,278
9,885
9,011
21
$’000
110,816
89,175
33,384
9,589
1,986
9,100
6,261
393,298
260,311
These amounts represent liabilities for goods and services provided to the Group prior to the end of financial year which are unpaid.
The amounts are unsecured and are usually paid within 45 to 60 days of recognition. Trade and other payables are presented as
current liabilities unless payment is not due within 12 months from the reporting date. They are recognised initially at their fair
value and subsequently measured at amortised cost using the effective interest method. The carrying amounts of trade and other
payables are considered to be the same as their fair values, due to their short-term nature.
(i) Contract liabilities
Movements in liabilities relating to revenue contracts are as follows:
Opening balance
Deferred revenue recognised
Revenue recognised
Exchange differences
Closing balance
Notes
2(b)
22
$’000
1,986
3,791
(2,433)
(66)
3,278
21
$’000
2,182
1,619
(1,751)
(64)
1,986
109
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 6 FINANCIAL ASSETS AND FINANCIAL LIABILITIES (CONTINUED)
(d) Borrowings
Secured
Bank loans
Capitalised borrowing costs
Other loans
Total secured borrowings
Unsecured
USD notes
Loan from non-controlling interest
Capitalised borrowing costs
Total unsecured borrowings
22
Current
Non-
current
Total
Current
Non-
current
21
Total
$’000
$’000
$’000
$’000
$’000
$’000
-
198,763
198,763
(1,427)
5,769
4,342
(3,569)
4,093
(4,996)
9,862
199,287
203,629
-
-
6,332
6,332
92,500
(2,413)
9,551
92,500
(2,413)
15,883
99,638
105,970
-
651,749
651,749
1,159
(3,329)
-
1,159
(7,544)
(10,873)
(2,170)
644,205
642,035
-
-
600,004
600,004
1,290
1,290
(3,064)
(3,064)
(10,009)
(13,073)
591,285
588,221
Total borrowings
2,172
843,492
845,664
3,268
690,923
694,191
At 30 June 2022, the Group had total unutilised facilities (bank and other loans) of $220,079,000 (2021: $329,580,000).
Bank loans
In June 2022, Perenti Global Limited announced the successful refinancing of its existing A$400 million revolving credit
facilities which were due to mature on 1 July 2023. As at 30 June 2022, 51% of the existing facilities were drawn. The new
A$420 million syndicated debt facility which settled on 8 July 2022 is provided by a number of leading lending institutions in
the Global banking market. The facility is comprised of tranches with 2, 3, 4 and 5 year maturity dates.
Other loans
Other loans include asset financing arrangements with various financiers which are secured by the specific assets financed.
USD notes
On 7 October 2020 Perenti issued 6.50% Guaranteed Senior Notes due for repayment 7 October 2025 with a US$450 million
principal amount. The notes were issued by Perenti Finance Pty Ltd and are unsecured and have been guaranteed by Perenti
Global Limited and its subsidiaries. The interest on the notes is payable semi-annually on 7 April and 7 October. The notes are
quoted on the Singapore Stock Exchange.
Loan from non-controlling interest
The loan is from the joint venture partner to AMAX Limited, in prior year to Underground Mining Alliance Limited.
Covenants on financing facilities
The Group’s financing facilities contain undertakings including an obligation to comply with certain financial covenants.
All banking covenants have been complied with at reporting date and the Group has significant headroom available under all
covenants.
Refinancing requirements
Where existing facilities approach maturity, the Group will seek to renegotiate with existing and new financiers to replace or
extend the maturity date of those facilities. The Group’s earnings profile, credit rating, state of the economy, conditions in
financial markets and other factors may influence the outcome of those negotiations.
Credit ratings
The Group currently has a credit rating of Ba2 (Outlook Stable) from Moody’s, a credit rating of BB (Outlook Stable) from
Standard & Poor’s and a credit rating of BB+ (Outlook Stable) from Fitch, which represents an improvement on last year’s
rating. Where a credit rating is reduced or placed on negative watch, customers and suppliers may be less willing to contract
with the Group. Banks and other lending institutions may demand more stringent terms (including increased pricing) on debt
facilities to reflect the higher credit risk profile.
110
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 6 FINANCIAL ASSETS AND FINANCIAL LIABILITIES (CONTINUED)
(d) Borrowings (continued)
Fair value
For the majority of the borrowings, the fair values were not materially different to their carrying amounts, since the interest
payable on those borrowings is either close to current market rates or the borrowings are of a short-term nature. Material
differences are identified only for the following borrowings:
Carrying
amount
$’000
22
Fair value
$’000
21
Fair value
$’000
Carrying
amount
$’000
On-balance sheet
Traded financial liabilities
USD notes - unsecured US$450 million
651,749
622,081
600,004
631,864
The fair values of non-current borrowings are based on market price (Level 1) at the balance sheet date.
Accounting policies
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at
amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in
profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan
facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be
drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable
that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised
over the period of the facility to which it relates.
Borrowings are removed from the statement of financial position when the obligation specified in the contract is discharged,
cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or
transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is
recognised in other income and other expenses.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability
for at least 12 months after the reporting period.
Borrowing costs incurred for the construction of any qualifying asset are capitalised during the period of time that is required
to complete and prepare the asset for its intended use or sale. Other borrowing costs are expensed.
111
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 6 FINANCIAL ASSETS AND FINANCIAL LIABILITIES (CONTINUED)
(e) Recognised fair value measurements
Fair value hierarchy
(i)
The Group classifies its financial instruments using the three levels as prescribed under AASB 13 Fair Value Measurement.
The following table presents the Group’s financial assets measured and recognised at fair value at 30 June 2022 and 30 June
2021 on a recurring basis:
At 30 June 2022
Financial assets
Financial assets FVOCI
Australian listed equity securities
Australian unlisted equity securities
CAD listed equity securities
GBP listed equity securities
Total financial assets
At 30 June 2021
Financial assets
Financial assets FVOCI
Australian listed equity securities
Australian unlisted equity securities
CAD listed equity securities
GBP listed equity securities
Total financial assets
Level 1
$’000
Level 2
$’000
Level 3
$’000
Total
$’000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Level 1
$’000
Level 2
$’000
Level 3
$’000
Total
$’000
6,118
-
704
564
7,386
-
-
-
-
-
-
18,150
-
-
6,118
18,150
704
564
18,150
25,536
Level 1: The fair value of financial instruments traded in active markets (such as publicly traded derivatives and equity
securities) is based on quoted market prices at the end of the reporting period. The quoted market price used for financial
assets held by the Group is the current bid price. These instruments are included in level 1.
Level 2: The fair value of financial instruments that are not traded in an active market (for example, over-the-counter
derivatives) is determined using valuation techniques which maximise the use of observable market data without over reliance
on entity specific estimates. The instrument is included in level 2 if all significant inputs required to fair value an instrument
are observable.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.
This is the case for unlisted equity securities.
(ii) Valuation techniques used to determine fair values (level 1)
Specific valuation techniques used to value financial instruments include the use of quoted market prices or dealer quotes for
similar instruments.
(iii) Fair value measurements using significant unobservable inputs (level 3)
The following table presents the changes in level 3 items (unlisted equity securities) for the period ended 30 June 2022:
Opening balance
Transfers between levels
Gains recognised in other comprehensive income
Disposals
Closing balance
22
$’000
18,150
-
30,813
(48,963)
21
$’000
18,475
(325)
-
-
-
18,150
There were no transfers between the levels of the fair value hierarchy and there were no changes to the valuation methods
applied as of 30 June 2022.
(iv) Valuation inputs and relationships to fair value
Changes in the fair value of unlisted equity securities are analysed at least each reporting period by discussion with the
Chief Financial Officer. As part of this discussion the team explains the reason for any fair value movements based on
information received in relation to recent transactions or financial information of the unlisted equity securities.
112
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 7 NON-FINANCIAL ASSETS AND LIABILITIES
(a)
Inventories
Work in progress
Finished goods
Consumables
22
$’000
19,659
15,908
176,552
212,119
21
$’000
34,029
19,870
160,512
214,411
Assigning costs to inventories
(i)
Consumables and store items, work in progress and finished goods are stated at the lower of cost and net realisable value.
Cost comprises direct materials, direct labour and an appropriate proportion of variable and fixed overhead expenditure,
the latter being allocated based on normal operating capacity. Costs are assigned to individual items of inventory based
on weighted average costs. Net realisable value is the estimated selling price in the ordinary course of business less the
estimated costs to sell.
(ii) Amounts recognised in profit or loss
For the year ended 30 June 2022, write-downs of inventories to net realisable value totalled $807,000 (2021: $20,833,000)
and inventory provisions of $1,036,000 (2021: $10,223,000) were recorded against the consolidated statement of profit
or loss. The inventory provision balance at 30 June 2022 amounted to $10,980,000 (2021: $18,218,000). There was no
impairment recorded against inventory (2021: $10,660,000) for the year ended 30 June 2022.
(b) Assets classified as held for sale
Current assets
Plant and equipment
Inventories
22
$’000
5,459
2,029
7,488
21
$’000
28,894
-
28,894
On 30 June 2022 the Group signed a Heads of Agreement to sell its assets and inventory in African Mining Services Mali
Sarl for total consideration of $9.3 million (USD$6.5 million). The sale is expected to be completed within the first quarter of
financial year ending 30 June 2023 and the assets held for sale are presented within total assets of Contract Mining - Surface
in the note 1 Segment information.
In the prior period on 24 June 2021 the Group accepted an offer to sell its Canning Vale premises (land and buildings) for
consideration of $32.1 million. Due diligence was completed and the sale was finalised in the first half of the 30 June 2022
financial year. The asset was presented under Corporate in the prior period note 1 Segment information.
113
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 7 NON-FINANCIAL ASSETS AND LIABILITIES (CONTINUED)
Land and
buildings
$’000
Plant and
equipment
$’000
Total
$’000
Notes
(c)
Property, plant and equipment
Non-current
At 1 July 2020
Cost or fair value
Accumulated depreciation
Net book amount
Year ended 30 June 2021
Opening net book amount
Exchange differences
Additions
Disposals
Depreciation expense
Impairment
Transfer from right-of-use
Transfers from/(to) intangible assets
Transfer to inventory
Acquisition of subsidiary
Revaluation of land and buildings
Assets classified as held for sale
Closing net book amount
At 30 June 2021
Cost or fair value
Accumulated depreciation
Net book amount
Year ended 30 June 2022
Opening net book amount
Adjustment for Software-as-a-Service
25(a)
Restated opening net book amount
Year ended 30 June 2022
Restated opening net book amount
Exchange differences
Additions
Disposals
Depreciation expense
Transfer to right-of-use
Transfer from inventory
Transfers to intangible assets
Assets classified as held for sale
Closing net book amount
At 30 June 2022
Cost or fair value
Accumulated depreciation
Net book amount
114
66,396
(9,368)
57,028
57,028
(1,753)
201
-
(2,086)
-
-
940
-
-
(346)
(28,894)
25,090
28,038
(2,948)
25,090
25,090
-
25,090
25,090
665
419
(59)
(1,580)
-
-
-
-
1,704,693
(943,625)
761,068
1,771,089
(952,993)
818,096
761,068
(16,126)
276,948
(84,927)
(185,857)
(54,054)
5,688
(2,684)
(3,854)
18
-
-
696,220
1,657,301
(961,081)
696,220
696,220
(4,643)
691,577
691,577
8,252
443,558
(26,276)
(223,498)
(320)
16,484
(2,533)
(5,459)
818,096
(17,879)
277,149
(84,927)
(187,943)
(54,054)
5,688
(1,744)
(3,854)
18
(346)
(28,894)
721,310
1,685,339
(964,029)
721,310
721,310
(4,643)
716,667
716,667
8,917
443,977
(26,335)
(225,078)
(320)
16,484
(2,533)
(5,459)
24,535
901,785
926,320
28,229
(3,694)
24,535
1,962,935
1,991,164
(1,061,150)
(1,064,844)
901,785
926,320
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 7 NON-FINANCIAL ASSETS AND LIABILITIES (CONTINUED)
(c)
Property, plant and equipment (continued)
(i) Carrying amounts that would have been recognised if land and buildings were stated at cost
If land and buildings were stated on the historical cost basis, the amounts would be as follows:
Buildings
Cost
Accumulated depreciation
Net book amount
22
$’000
41,364
(19,914)
21,450
21
$’000
39,837
(19,002)
20,835
Increases in the carrying amounts arising on revaluation of land and buildings are credited, net of tax, in other comprehensive
income and accumulated in reserves in shareholders’ equity. To the extent that the increase reverses a decrease previously
recognised in profit or loss, the increase is first recognised in profit or loss. Decreases that reverse previous increases of the
same asset are first recognised in other comprehensive income to the extent of the remaining surplus attributable to the
asset; all other decreases are charged to profit or loss. Each year, the difference between depreciation based on the revalued
carrying amount of the asset charged to profit or loss and depreciation based on the asset’s original cost, net of tax, is
reclassified from the property, plant and equipment revaluation surplus to retained earnings.
(ii) Depreciation methods and useful lives
Land is not depreciated. Depreciation on major plant and equipment and components is calculated on machine hours
worked over their estimated useful life. Depreciation on other assets is calculated using the straight-line method to allocate
their cost or revalued amounts, net of their residual values, over their estimated useful lives, as follows:
• Buildings
5 - 25 years
• Plant and equipment
2 - 15 years
Accounting policies
The Group’s accounting policy for land and buildings is explained above. All other plant and equipment is stated at historical
cost less depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of
the items.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when
it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be
measured reliably. All other repairs and maintenance are charged to profit or loss during the reporting period in which they
are incurred.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater
than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with carrying amount. These gains or losses are
included in profit or loss. When revalued assets are sold, it is Group policy to transfer any amounts included in other reserves
in respect of those assets to retained earnings.
Maintenance, repair costs and minor renewals are charged as expenses as incurred. Significant costs incurred in overhauling
plant and equipment are capitalised and depreciated over the remaining useful life of the asset or the component.
(iii) Key estimates: property, plant and equipment
The estimations of useful lives, residual value and depreciation methods require management judgement and are reviewed
annually. If they need to be modified, the change is accounted for prospectively from the date of reassessment until the end
of the revised useful life (for both the current and future years). Such revisions are generally required when there are changes
in economic circumstances impacting specific assets or groups of assets, such as changes to contract length or when an
asset designation from idle to non-idle occurs. These changes are limited to specific assets and as such, any reasonably
possible change in the estimate is unlikely to have a material impact on the estimations of useful lives, residual value or
amortisation methods.
115
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 7 NON-FINANCIAL ASSETS AND LIABILITIES (CONTINUED)
(d)
Leases
Amounts recognised in the balance sheet
(i)
The balance sheet shows the following amounts relating to leases:
Right-of-use assets
Properties
Equipment
Motor vehicles
Lease liabilities
Current
Non-current
22
$’000
24,814
33,992
499
59,305
27,943
28,250
56,193
21
$’000
19,012
55,341
338
74,691
24,537
49,272
73,809
Additions to the right-of-use assets during the 2022 financial year were $35,625,000 (2021: $2,878,000). During the year,
$25,709,000 worth of right-of-use assets were released when MinAnalytical and Well Control Solutions businesses were
disposed.
(ii) Amounts recognised in the statement of profit or loss
Depreciation charge of right-of-use assets
Properties
Equipment
Motor vehicles
Interest expense (included in finance cost)
Expense relating to short-term leases (included in rental and hire expenses)
Expense relating to leases of low-value assets that are not shown above as
short-term leases (included in rental and hire expenses)
Expense relating to variable lease payments not included in lease liabilities
(included in rental and hire expenses)
Notes
4(b)
22
$’000
8,206
16,370
466
25,042
3,635
25,292
-
20,014
21
$’000
8,291
25,738
258
34,287
5,294
16,440
225
445
The total cash outflow for leases (including interest) in 2022 was $30,090,000 (2021: $35,577,000).
116
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 7 NON-FINANCIAL ASSETS AND LIABILITIES (CONTINUED)
(d)
Leases (continued)
(iii) The Group’s leasing activities and accounting treatment
The group leases various offices, warehouses, equipment and vehicles across various countries. Rental contracts are made
for fixed periods of up to 25 years, but may have extension options as described in (v), below.
Contracts may contain both lease and non-lease components. The Group allocates the consideration in the contract to the
lease and non-lease components based on their relative stand-alone prices.
Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease
agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor.
Leased assets may not be used as security for borrowing purposes.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present
value of the following lease payments:
• fixed payments (including in-substance fixed payments), less any lease incentives receivable
• variable lease payments that are based on an index or a rate, initially measured using the index or rate as at the
commencement date
• amounts expected to be payable by the Group under residual value guarantees
•
the exercise price of a purchase option if the Group is reasonably certain to exercise that option, and
• payments of penalties for terminating the lease, if the lease term reflects the Group exercising that option.
The Group is exposed to potential future increases in variable lease payments based on an index or rate, which are not
included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take effect,
the lease liability is reassessed and adjusted against the right-of-use asset. Lease payments to be made under reasonably
certain extension options are also included in the measurement of the liability.
The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined,
which is generally the case for leases in the Group, the lessee’s incremental borrowing rate is used, being the rate that the
individual lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset
in a similar economic environment with similar terms, security and conditions.
To determine the incremental borrowing rate, the Group:
• where possible, uses recent third-party financing received by the individual lessee as a starting point, adjusted to reflect
changes in financing conditions since third party financing was received;
• uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk for leases held by the Group,
which does not have recent third party financing, and
• makes adjustments specific to the lease, eg term, country, currency and security.
Lease payments are allocated between principal and finance cost. The finance cost is charged to profit or loss over the lease
period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.
Right-of-use assets are measured at cost comprising the following:
•
the amount of the initial measurement of lease liability;
• any lease payments made at or before the commencement date less any lease incentives received;
• any initial direct costs, and
•
restoration costs.
Right-of-use assets are generally depreciated over the shorter of the asset’s useful life and the lease term on a straight-
line basis. If the Group is reasonably certain to exercise a purchase option, the right-of-use asset is depreciated over the
underlying asset’s useful life. While the Group revalues its land and buildings that are presented within property, plant and
equipment, it has chosen not to do so for the right-of-use buildings held by the Group.
Payments associated with short-term leases of equipment and vehicles and all leases of low-value assets are recognised on
a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less.
Low-value leases are leases with a total lease payments less than $7,500 (US$5,000).
(iv) Variable lease payments
Some equipment leases contain variable payment terms that are linked to units of use of the particular asset. Often these
will include a minimum usage charge each month which is considered the fixed element, and then items over and above the
minimum are considered the variable element. Variable lease payments that depend on units of use are recognised in profit
or loss in the period in which the condition that triggers those payments occurs.
117
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 7 NON-FINANCIAL ASSETS AND LIABILITIES (CONTINUED)
(d)
Leases (continued)
(v) Extension and termination options
Extension and termination options are included in a number of property and equipment leases across the Group. These
are used to maximise operational flexibility in terms of managing the assets used in the Group’s operations. The majority of
extension and termination options held are exercisable only by the Group and not by the respective lessor.
Critical judgements in determining the lease term
In determining the lease term, management considers all facts and circumstances that create an economic incentive to
exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options)
are only included in the lease term if the lease is reasonably certain to be extended (or not terminated).
For leases of warehouses, offices and equipment, the following factors are normally the most relevant:
•
•
If there are significant penalties to terminate (or not extend), the Group is typically reasonably certain to extend (or not
terminate).
If any leasehold improvements are expected to have a significant remaining value, the Group is typically reasonably
certain to extend (or not terminate).
• Otherwise, the Group considers other factors including historical lease durations and the costs and business disruption
required to replace the leased asset.
As at 30 June 2022, potential future cash outflows of $32,189,000 (undiscounted) (2021: $27,273,000) have not been
included in the lease liability because it is not reasonably certain that the leases will be extended (or not be terminated).
The lease term is reassessed if an option is actually exercised (or not exercised) or the Group becomes obliged to exercise
(or not exercise) it. The assessment of reasonable certainty is only revised if a significant event or a significant change in
circumstances occurs, which affects this assessment, and that is within the control of the lessee. During the current financial
year, the financial effect of revising lease terms to reflect the effect of exercising extension and termination options was an
decrease in recognised lease liabilities and right-of-use assets of $328,000.
(e)
Intangible assets
Goodwill
Software
Customer related
intangibles
$’000
$’000
$’000
Year ended 30 June 2021
Opening net book amount
Acquisition of subsidiary
Transfer from property, plant and equipment
Amortisation expense
Closing net book amount
At 30 June 2021
Cost
Accumulated amortisation and impairment
Net book amount
Year ended 30 June 2022
Opening net book amount
Acquisition of subsidiary
Additions
Impairment
Transfer from property, plant and equipment
Exchange differences
Amortisation expense
Closing net book amount
At 30 June 2022
Cost
Accumulated amortisation and impairment
Net book amount
449,769
5,000
-
-
454,769
454,769
-
454,769
454,769
2,531
-
-
-
-
-
457,300
457,300
-
457,300
802
6,217
1,744
(1,201)
7,562
15,171
(7,609)
7,562
7,562
695
19,762
-
2,533
76
(3,758)
26,870
38,867
(11,997)
26,870
118
Total
$’000
705,156
11,217
1,744
(39,303)
678,814
791,398
(112,584)
678,814
678,814
3,226
19,762
(23,162)
2,533
76
(29,042)
652,207
254,585
-
-
(38,102)
216,483
321,458
(104,975)
216,483
216,483
-
-
(23,162)
-
-
(25,284)
168,037
321,459
(153,422)
168,037
817,626
(165,419)
652,207
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 7 NON-FINANCIAL ASSETS AND LIABILITIES (CONTINUED)
(e)
Intangible assets (continued)
Accounting policies
The Group amortises intangible assets with a limited useful life using the straight-line method over the following periods:
• Software
• Customer related intangibles
5-8 years
2-12 years
Goodwill
Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill is not amortised, but it is tested for
impairment annually, or more frequently if events or changes in circumstances indicate that it might be impaired, and is
carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount
of goodwill relating to the entity sold. Goodwill is allocated to cash-generating units for the purpose of impairment testing.
The allocation is made to those cash-generating units or groups of cash-generating units that are expected to benefit from
the business combination in which the goodwill arose, identified according to operating segments. 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 fair value less costs to sell and value-in-use. For the purposes of assessing for impairment, assets
are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the
cash inflows from other assets or groups of assets (cash-generating units). Intangibles other than goodwill that suffered an
impairment, are reviewed for possible reversal of the impairment at each reporting period.
Customer related intangibles
Customer related intangibles acquired in a business combination are recognised at fair value at the acquisition date. They
have a finite useful life and are subsequently carried at cost less accumulated amortisation and impairment losses. Customer
related intangibles are amortised over the life of contract.
it is technically feasible to complete the software so that it will be available for use
IT development and software
Costs associated with maintaining software programmes are recognised as an expense as incurred. Development costs that
are directly attributable to the design and testing of identifiable and unique software products controlled by the Group are
recognised as intangible assets where the following criteria are met:
•
• management intends to complete the software and use or sell it
•
•
• adequate technical, financial and other resources to complete the development and to use or sell the software are
there is an ability to use or sell the software
it can be demonstrated how the software will generate probable future economic benefits
available, and
the expenditure attributable to the software during its development can be reliably measured.
•
Directly attributable costs that are capitalised as part of the software include employee costs and an appropriate portion of
relevant overheads. Capitalised development costs are recorded as intangible assets and amortised from the point at which
the asset is ready for use. Amortisation is calculated using the straight-line method over estimated useful lives.
Research and development
Expenditure on research activities, undertaken with the prospect of obtaining new scientific or technical knowledge and
understanding, is recognised in the income statement as an expense when it is incurred. Expenditure on development
activities, being the application of research findings or other knowledge to a plan or design for the production of new or
substantially improved products or services before the start of commercial production or use, is capitalised if the product
or service is technically and commercially feasible and adequate resources are available to complete development. The
expenditure capitalised comprises all directly attributable costs, including costs of materials, services, direct labour and an
appropriate proportion of overheads. Other development expenditure is recognised in the income statement as an expense
as incurred. Capitalised development expenditure is stated at cost less accumulated amortisation. Amortisation is calculated
using the straight-line method to allocate the cost over the period of the expected benefit.
(i) Customer contracts
The customer contracts were acquired as part of the Barminco acquisition in 2019. They were recognised at their fair value at
the date of acquisition and are subsequently amortised on a straight-line, based on the timing of projected cash flows from
the contracts over their estimated useful lives. As disclosed in the 31 December 2021 interim financial report, an impairment
of $23.2 million was recorded following the exit of the Sukari contract in Egypt. The exit of this contract was an indicator of
impairment at 31 December 2021, which resulted in an impairment of the entire remaining value of the customer related
intangibles balance allocated to that contract. An assessment was conducted at 30 June 2022 and no further impairment
indicators were identified on the remaining customer related intangibles.
119
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS
7 NON-FINANCIAL ASSETS AND LIABILITIES (CONTINUED)
(e)
Intangible assets (continued)
Impairment considerations for goodwill
(ii)
The Group tested goodwill for impairment at 30 June 2022 and no impairment was recorded. Goodwill was recognised
for the Contract Mining - Underground segment following the Barminco acquisition in 2019 and on the idoba group of
companies that were progressively acquired since 2021.
On 1 February 2022 the Group acquired two technology companies and recognised $2.5 million of goodwill in addition to
the $5.0 million recognised on the prior period acquisitions. At 30 June 2022, the recoverable amount of the newly acquired
assets have been determined based upon fair value less cost of disposal, with reference to the recent purchase price of the
acquired interest. There are no indicators to suggest that the fair value of the recently acquired companies has significantly
changed.
Value-in-use calculations were performed to test for goodwill impairment across the Contract Mining - Underground and
idoba CGU.
(iii) Key assumptions used for value-in-use calculations
In determining the CGU’s recoverable amount, estimates are made regarding the present value of future cash flows. These
estimates are calculated using management judgement, contain elements of risk and uncertainty, can be impacted by
changes in economic conditions, and changes to the discount rates used to calculate the present value of future cash flows.
The basis of the estimates and key assumptions used to determine recoverable amounts and test for goodwill impairment in
relation to the Underground CGU at 30 June 2022 are set out below:
• Cash flow projections were based upon individual committed and uncommitted project forecasts for the prospective five
year period.
• Cash flow projections beyond the five-year period were extrapolated using a growth rate of 2.5% (2021: 2.5%).
• EBITDA margins were based upon historical averages adjusted for prevailing economic conditions. These have not been
disclosed as they are considered to be commercially sensitive.
• The weighted average cost of capital pre-tax discount rates were in the range of 13.3% and 24.6% (2021: 12.9% and
19.5%) and varied depending on the country risk assigned to the region in which a project was domiciled. The present
value of cash flows is sensitive to the growth and discount rates used noting a higher discount rate will result in a lower
recoverable value.
• A foreign exchange rate of $0.69 US$:AUD spot rate was used to translate the US Dollar denominated CGU’s into
Australian Dollars and $0.89 CAD$:AUD spot rate was used to translate the Canadian Dollar denominated CGU’s into
Australian Dollars.
Significant estimate: Impact of possible changes in key assumptions - Contract Mining - Underground CGU
Management have considered various reasonably possible value-in-use sensitivities for the Contract Mining - Underground
CGU at 30 June 2022, when testing goodwill for impairment. The table below shows the impairment impact of adjusting
these sensitivity assumptions.
Assumption
Growth rate in terminal year (decrease reduces value)
Discount rate (decrease increases value)
Foreign exchange rate (decrease increases value)
Average EBITDA margin (decrease reduces value)
% Change
+1.0%
-1.0%
-1.0%
+1.0%
-5cents
+5cents
+1.0%
-1.0%
Contract Mining
- Underground
Impairment (A$)
No impact
No impact
No impact
No impact
No impact
No impact
No impact
No impact
The above sensitivities have been performed holding all other assumptions in the model constant.
120
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 7 NON-FINANCIAL ASSETS AND LIABILITIES (CONTINUED)
(f)
Employee benefit obligations
Current
Non- current
22
Total
$’000
$’000
$’000
Leave obligations
79,722
4,263
83,985
Current
Non- current
21
Total
$’000
70,719
$’000
$’000
2,870
73,589
Leave obligations
(i)
The current leave obligations include all of the accrued annual leave, the unconditional entitlements to long service leave
where employees have completed the required period of service and employee entitlements to pro-rata payments where
applicable. The total amount of the current provision of $79,722,000 (2021: $70,719,000) is presented as current, since
the Group does not have an unconditional right to defer settlement for any of these obligations. However, based on past
experience, the Group does not expect all employees to take the full amount of accrued leave or require payment within the
next 12 months.
The following amounts reflect leave that is not expected to be taken or paid within the next 12 months.
Current leave obligations expected to be settled after 12 months
Accounting policies
22
$’000
47,253
21
$’000
25,522
Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits and accumulating sick leave that are expected to be
settled wholly within 12 months after the end of the period in which the employees render the related service are recognised
in respect of employees’ services up to the end of the reporting period and are measured at the amounts expected to be paid
when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.
Other long-term employee benefit obligations
The liabilities for long service leave and annual leave are not expected to be settled wholly within 12 months after the end of
the period in which the employees render the related service. They are therefore measured as the present value of expected
future payments to be made in respect of services provided by employees up to the end of the reporting period using the
projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee
departures and period of service. Expected future payments are discounted using market yields at the end of the reporting
period of high quality corporate bonds with terms and currencies that match, as closely as possible, the estimated future cash
outflows. Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognised in
profit or loss.
The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to
defer settlement for at least twelve months after the reporting date, regardless of when the actual settlement is expected to
occur.
Share-based payments
Equity settled share-based compensation benefits are provided to employees via the Perenti Global Limited Incentive Rights
Plan. Information relating to this scheme is set out in note 19. Equity settled share-based payments are measured at the fair
value of the equity instruments at grant date.
121
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 7 NON-FINANCIAL ASSETS AND LIABILITIES (CONTINUED)
(g) Recognised fair value measurements
Fair value hierarchy
(i)
This note explains the judgements and estimates made in determining the fair values of the non-financial assets that are
recognised and measured at fair value in the financial statements. To provide an indication about the reliability of the inputs
used in determining fair value, the Group has classified its non-financial assets into the three levels prescribed under the
accounting standards. An explanation of each level is provided in note 6(e) and 7(g)(ii)-(v).
At 30 June 2022
Assets
Land and buildings
Office buildings
Industrial sites
Total non-financial assets
At 30 June 2021
Assets
Land and buildings
Office buildings
Industrial sites
Assets classified as held for sale
Total non-financial assets
Level 1
$’000
Level 2
$’000
Level 3
$’000
Total
$’000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,723
20,812
24,535
3,723
20,812
24,535
3,839
21,251
28,894
53,984
3,839
21,251
28,894
53,984
There were no transfers between any levels for recurring fair value measurements during the current or prior period.
(ii) Valuation techniques used to determine level 3 fair values
The Group obtains independent valuations for its freehold land and buildings (classified within property, plant and
equipment) at least every three years, see note 7(g)(v) for details.
At the end of each reporting period, the directors update their assessment of the fair value of each property, taking into
account the most recent independent valuations. The directors determine a property’s value within a range of reasonable
fair value estimates.
The best evidence of fair value is current prices in an active market for similar properties. Where such information is not
available, the directors consider information from a variety of sources including:
• capitalised income projections based on a property’s estimated net market income, and a capitalisation rate derived from
an analysis of market evidence.
• current prices in an active market for properties of a different nature or recent prices of similar properties in less active
markets, adjusted to reflect those differences.
(iii) Fair value measurements using significant unobservable inputs (level 3)
The following table presents the changes in level 3 items for the periods ended 30 June 2021 and 30 June 2022 for recurring
fair value measurements:
Opening balance 1 July 2020
Acquisitions
Depreciation and impairment
Revaluation
Transfers between classes
Losses recognised in other comprehensive income
Closing balance 30 June 2021
Acquisitions
Disposals
Depreciation and impairment
Gains recognised in other comprehensive income
Closing balance 30 June 2022
122
Office buildings
Industrial sites
$’000
5,674
-
(776)
(1,962)
995
(92)
3,839
-
-
(444)
328
3,723
$’000
51,463
201
(1,524)
1,616
(55)
(1,556)
50,145
419
(28,953)
(1,547)
748
20,812
Total
$’000
57,137
201
(2,300)
(346)
940
(1,648)
53,984
419
(28,953)
(1,991)
1,076
24,535
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 7 NON-FINANCIAL ASSETS AND LIABILITIES (CONTINUED)
(g) Recognised fair value measurements (continued)
(iv) Valuation inputs and relationships to fair value
The following table summarises the quantitative information about the significant unobservable inputs used in level 3 fair
value measurements.
Valuation
Technique
Unobservable
inputs*
Range of inputs
(probability-weighted
average)
Relationship of
unobservable
inputs to fair value
Fair value at
30 June
2022
30 June
2021
Description
$’000
$’000
2022
2021
Industrial Sites
-Australia
and Assets
classified as
held for sale
Industrial Sites
-Ghana
Office
Buildings
-Ghana
12,219
41,401 Direct
comparison
8,593
8,744 Direct
comparison
3,723
3,839 Direct
comparison
Selection of
industrial sites
with similar
approximate
utility
Selection of
industrial sites
with similar
approximate
utility
Selection of
industrial sites
with similar
approximate
utility
$5-$632
per m2
$5-$632
per m2
($340)
The higher the rate
per square metre,
the higher the fair
value
$213-$653
per m2
$213-$653
per m2
($395)
The higher the rate
per square metre,
the higher the fair
value
$857
per m2
$857
per m2
($857)
The higher the rate
per square metre,
the higher the fair
value
*
There were no significant inter-relationships between unobservable inputs that materially affect fair values.
(v) Valuation processes
The Group engages external, independent and qualified valuers to determine the fair value of the Group’s land and buildings
every three years. The fair values of the industrial sites properties have been determined by members of the Australian
Property Institute and the Ghana Institute of Surveyors for the year ended 30 June 2021.
The main level 3 inputs used by the Group are derived and evaluated as follows:
•
Industrial sites - discount rates, terminal yields, expected vacancy rates and values per square metre are estimated by
members of the Australian Property Institute, and the Ghana Institute of Surveyors based on comparable transactions and
industry data;
• Historical cost for recently completed buildings.
123
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 22
$’000
21
$’000
8 EQUITY
(a) Contributed equity
Fully paid ordinary shares
702,460,434
704,295,221
1,137,030
1,137,783
22
Shares
21
Shares
22
$’000
21
$’000
(i) Movements in ordinary share capital:
Details
Opening balance 1 July 2021
Share issue on conversion of employee share rights
Buy-back of ordinary shares, net of transaction costs and tax
Deferred tax movement on capital raising costs
Balance 30 June 2022
Number of
shares
Total
$’000
704,295,221
1,137,783
1,415,972
(3,250,759)
-
1,888
(2,057)
(584)
702,460,434
1,137,030
(ii) Ordinary shares
Ordinary shares are classified as equity and entitle the holder to participate in dividends and the proceeds on winding up of
the Company in proportion to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and
upon a poll each share is entitled to one vote.
Ordinary shares have no par value and the Company does not have a limited amount of authorised capital.
Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the
proceeds. Incremental costs directly attributable to the issue of new shares for the acquisition of a business are not included
in the cost of the acquisition as part of the purchase consideration.
(iii) Dividend reinvestment plan
The Company’s Dividend Reinvestment Plan is currently suspended until further notice.
(iv) Rights
Information relating to the Perenti Global Limited Incentive Rights Plan, including details of rights issued, vested and forfeited
during the financial year and rights outstanding at the end of the financial year, is set out in note 19.
Share buy-back
(v)
The Company has implemented its capital management strategy which includes the buy-back of shares on market.
In the year ended 30 June 2022, 3.3 million shares were bought back by the Company for a consideration of $2.0 million.
At 30 June 2022, $0.9 million had been paid in cash and the remaining amount payable is recorded in other creditors and
accruals in note 6(c).
(b) Other reserves
The following table shows a breakdown of the balance sheet line item other reserves and the movements in these reserves
during the year. A description of the nature and purpose of each reserve is provided below:
Revaluation
surplus
Financial
assets at
FVOCI
Share-
based
payments
Transactions
with NCI
Foreign
currency
translation
Notes
$’000
$’000
$’000
$’000
$’000
Total
$’000
Balance at 1 July 2020
Revaluation - gross
6(b)
Deferred tax
Currency translation differences
Other comprehensive income
Transactions with owners in their
capacity as owners
Share-based payments expense 19(c)
Shares issued on conversion of
employee share options/rights
24,680
646
(448)
(373)
(175)
-
-
6,379
1,904
(571)
-
1,333
-
-
At 30 June 2021
24,505
7,712
13,064
(2,664)
(52,563)
(11,104)
-
-
-
-
2,033
(2,001)
13,096
-
-
-
-
-
-
-
2,550
(1,483)
(2,502)
803
(680)
430
478
-
-
2,033
(2,001)
(2,664)
(53,243)
(10,594)
124
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS
8 EQUITY (CONTINUED)
(b) Other reserves (continued)
Revaluation
surplus
Financial
assets at
FVOCI
Share-
based
payments
Transactions
with NCI
Foreign
currency
translation
Notes
$’000
$’000
$’000
$’000
$’000
Total
$’000
Balance at 1 July 2021
24,505
7,712
13,096
(2,664)
(53,243)
(10,594)
Vested employee share
rights that have lapsed, been
cancelled or forfeited
Asset revaluation reserve gain
taken to retained earnings on
sale of asset
Revaluation - gross
6(b)
Deferred tax
Transfer from financial assets
at FVOCI reserve to retained
earnings
Currency translation
differences
-
(11,998)
-
-
-
-
-
-
31,089
(9,327)
(29,474)
-
(1,929)
-
-
-
-
-
Other comprehensive income
(11,998)
(7,712)
(1,929)
Transactions with owners in
their capacity as owners
Share-based payments
expense
19(c)
Shares issued on conversion
of employee share rights
At 30 June 2022
(i) Nature and purpose of other reserves
-
-
12,507
-
-
-
4,591
(1,888)
13,870
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1,929)
(11,998)
31,089
(9,327)
(29,474)
(26,497)
(26,497)
(26,497)
(48,136)
-
-
4,591
(1,888)
(2,664)
(79,740)
(56,027)
Revaluation surplus - property, plant and equipment
The property, plant and equipment revaluation surplus is used to record increments and decrements from the revaluation of
non-current assets. In the event of a sale of an asset, any balance in the reserve related to the asset is transferred to retained
earnings.
Financial assets at FVOCI
The Group has elected to recognise changes to the fair value of certain equity security investments in OCI, as explained
in note 6(b). These changes are accumulated within the FVOCI reserve. The group transfers amounts from this reserve to
retained earnings when the relevant equity securities are derecognised.
Transactions with non-controlling interests (NCI)
This reserve is used to record the differences described in note 25(b)(iii) which may arise as a result of transactions with non-
controlling interests that do not result in a loss of control.
Share-based payments reserve
The share-based payments reserve is used to recognise the fair value of options and rights issued to employees that are
expensed in the statement of comprehensive income each year and conversion of options/rights.
Foreign currency translation
Exchange differences arising on translation of the foreign controlled entities are recognised in other comprehensive income
and accumulated in a separate reserve within equity. The cumulative amount is reclassified to profit or loss when the net
investment is disposed of.
The Group’s share of exchange differences arising on translation of foreign joint ventures are recognised in other
comprehensive income and are accumulated in this reserve.
125
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 9 CASH FLOW INFORMATION
(a) Reconciliation of profit/(loss) after income tax to net cash inflow from operating activities
Profit/(loss) for the year
Depreciation expense
Amortisation expense
Impairment of customer related intangibles
Impairment of assets
Impairment of inventory
Loss on revaluation of land and buildings
Gain on sale of businesses
Net exchange differences
Trade receivable provisions and bad debts
Non-cash employee benefits expense - share-based payments
Amortisation of borrowing costs and other non-cash finance costs
Other non-cash items - restructuring
Gain on sale of non-current assets
Redemption premium on 2022 High Yield Bonds
Change in operating assets and liabilities:
(Increase)/decrease in trade debtors
(Increase)/decrease in inventories
(Increase)/decrease in deferred tax assets
(Increase)/decrease in other operating assets
(Decrease)/increase in trade creditors
(Decrease)/increase in provision for income taxes payable
(Decrease)/increase in deferred tax liabilities
(Decrease)/increase in other provisions
Net cash inflow from operating activities
(b) Non-cash investing and financing activities
Recognition of right-of-use assets and lease liabilities
Issue of shares under Dividend Reinvestment Plan
(c) Net debt reconciliation
This section sets out an analysis of net debt and the movements in net debt.
Net debt
Cash and cash equivalents
Borrowings/lease liabilities - repayable within one year
Borrowings/lease liabilities - repayable after one year
Net debt
Cash and cash equivalents
Gross debt
Net debt
Gross debt is comprised of current and non-current borrowings and lease liabilities.
Net debt as at 1 July 2021
Cash flows
Foreign exchange adjustments
Other non-cash movements
Net debt as at 30 June 2022
126
Cash
$’000
264,741
78,292
5,486
-
348,519
Lease
liabilities
$’000
(73,809)
26,432
360
(9,176)
(56,193)
22
$’000
42,486
250,120
29,042
23,162
-
-
-
(25,643)
113
6,670
4,353
5,635
-
(3,489)
-
(44,257)
(16,562)
(38,503)
(36,373)
137,927
(989)
(3,641)
11,251
341,302
35,304
-
35,304
348,519
(30,115)
(871,742)
(553,338)
348,519
(901,857)
(553,338)
Borrowings
$’000
(694,191)
(92,706)
(58,033)
(734)
(845,664)
21
$’000
(52,303)
222,230
39,303
59,903
10,660
992
-
(140)
11,328
1,293
4,272
2,452
(473)
8,143
22,651
11,733
(16,910)
(5,108)
15,365
(4,058)
(32,247)
(2,823)
296,263
2,878
(962)
1,916
264,741
(27,805)
(740,195)
(503,259)
264,741
(768,000)
(503,259)
Total
$’000
(503,259)
12,018
(52,187)
(9,910)
(553,338)
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 10 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual
results. Management also needs to exercise judgement when applying the Group’s accounting policies.
This note provides an overview of the areas that require a high degree of judgement or complexity, and for items which could
have a material adjustment if estimates and assumptions were incorrect. Detailed information about each of these estimates and
judgements is included in notes 2 to 25 together with information about the basis of calculation for each affected line item in the
financial statements. In addition, this note also explains where there have been actual adjustments this year as a result of an error
and of changes to previous estimates.
Significant estimates and judgements
• Recognition of revenue
• Impairment of assets
• Recognition of deferred tax asset for carried forward tax losses
• Uncertain tax positions
• Estimation of useful life of property, plant and equipment
• Estimation uncertainties and judgements made in relation to lease accounting
• Determination of lease term
• Estimated goodwill impairment
• Estimated useful life of intangible assets
• Estimation of fair values of land and buildings
• Share-based payments - determining the achievement of non-market based conditions
note 2
note 3
note 5
note 5(g)
note 7(c)
note 7(d)
note 7(d)
note 7(e)
note 7(e)
note 7(g)
note 19
Estimates and judgements are continually evaluated. They are based on historical experience and other factors,
including expectations of future events that may have a financial impact on the entity and that are believed to be
reasonable under the circumstances.
127
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 11 FINANCIAL RISK MANAGEMENT
This note explains the Group’s exposure to financial risks and how these risks could affect the Group’s future financial performance.
Current year profit and loss information has been included where relevant to add further context.
The Group’s key management personnel report to the Audit and Risk Committee and Board regularly on the progress and
objectives of the risks and the associated corporate governance policy objectives.
The Group’s financial risk management is carried out by a central treasury department under policies approved by the Board of
directors. Group treasury identifies, evaluates and hedges financial risks in close co-operation with the Group’s operating units.
The Board provides written principles for overall risk management, as well as policies covering specific areas, such as foreign
exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and
investment of excess liquidity.
(a) Market risk
In respect of other monetary assets and liabilities held in currencies other than the AUD, the Group ensures that the net
exposure is kept to an acceptable level by matching foreign denominated financial assets with matching financial liabilities
and vice versa.
(i) Foreign exchange risk
Exposure
The Group’s exposure to material foreign currency risk at the end of the reporting period, expressed in Australian dollars, was
as follows:
30 JUNE 2022
USD
GHS
GBP
EUR
INR
TZS
BWP
XOF
CAD
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Cash
Trade and other receivables
6,142
50,800
242
784
-
1,409
15
63,224
Other non-current receivables
6,203
26,456
2,767
7,211
Trade payables
Borrowings
(18,848)
(12,104)
(963)
(61,894)
(11,194)
-
-
(7,560)
-
-
-
-
-
2,204
1,170
-
-
-
-
-
450
71
-
-
15,750
(132)
(2,376)
(2,230)
-
-
-
(2)
-
30 JUNE 2021
USD
GHS
GBP
EUR
INR
TZS
BWP
XOF
CAD
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
291
1,490
274
-
-
-
-
-
-
-
469
-
-
(315)
(1,932)
(2,415)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Cash
7,418
8,355
Trade and other receivables
15,363
14,701
-
16
2,836
9,022
Other non-current receivables
Financial assets FVOCI
-
-
-
-
2,796
11,281
564
-
Trade payables
Borrowings
(22,880)
(8,631)
(1,478)
(10,330)
(8,794)
-
-
(11,281)
128
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 11 FINANCIAL RISK MANAGEMENT (CONTINUED)
(a) Market risk (continued)
(i) Foreign exchange risk (continued)
Sensitivity analysis
The sensitivity analysis below shows the impact that a reasonably possible change in foreign exchange rates over a financial
year would have on profit after tax, based solely on the Group’s foreign exchange risks exposures existing at the balance
sheet date. A 10 percent strengthening of the Australian dollar against the following currencies at 30 June would have
impacted pre-tax profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular
interest rates, remain constant. The analysis is performed on the same basis for 2021.
The impact on profit is estimated by applying the hypothetical changes in the foreign currency rates to the balance of the
financial instruments at the reporting date.
Profit or (loss)
USD
XOF
GHS
GBP
BWP
EUR
TZS
EGP
ZAR
CAD
INR
22
$’000
(3,009)
162
(1,398)
(165)
110
(217)
(188)
(63)
(191)
(1,438)
-
(6,397)
21
$’000
808
177
(1,311)
(141)
(151)
(139)
(107)
(38)
-
-
(26)
(928)
A 10 percent weakening of the Australian dollar against the above currencies at 30 June would have had the equal but
opposite effect on the above currencies to the amounts shown above, on the basis that all other variables remain constant.
The Group’s exposure to other foreign exchange movements is not material.
(ii) Price risk
Exposure
The Group’s exposure to equity securities price risk arises from investments held by the Group and classified in the balance
sheet as at fair value through other comprehensive income (FVOCI).
0% (2021: 29%) of the Group’s investments in equity securities are publicly traded on the Australian Securities Exchange, the
London Stock Exchange and the Canadian Stock Exchange.
Sensitivity analysis
The impact of an increase/(decrease) of the financial assets FVOCI on the Group’s equity for the year after tax was $nil (2021:
FVOCI - increase 10% $1,788,000 and FVOCI - decrease 10% ($1,788,000). The analysis is based on the assumption that the
FVOCI financial assets had increased by 10% or decreased by 10% with all other variables held constant.
Other components of equity would increase/decrease as a result of gains/losses on equity securities classified as fair value
through other comprehensive income.
(iii) Interest rate risk
The Group’s main interest rate risk arises from long-term borrowings with fixed and variable rates, which expose the group to
cash flow interest rate risk. Group policy is to review on a continuous basis. During 2022 and 2021, the Group’s borrowings at
variable rate were mainly denominated in Australian and US dollars.
129
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 11 FINANCIAL RISK MANAGEMENT (CONTINUED)
(b) Credit risk
(i) Risk management
Credit risk is managed on a Group basis. Credit risk is the risk of financial loss to the Group if a customer or counterparty to a
financial asset fails to meet its contractual obligations, and arises principally from the Group’s receivables from customers and
investment securities. Credit risk also arises from cash and cash equivalents. The Group limits its exposure to credit risk from
cash and cash equivalents by only investing in counterparties that have an acceptable credit rating.
(ii) Trade receivables and accrued revenue provisions
The Group’s exposure to bad debts is not significant and default rates have historically been low. Individual receivables which
are known to be uncollectible are written off by reducing the carrying amount directly. The other receivables are assessed
collectively for expected credit losses.
Trade receivables and accrued revenue for which an impairment/expected credit loss provision was recognised are written
off against the provision when there is no expectation of recovering additional cash.
The creation and release of the provision for impaired and expected credit loss receivables has been included in other
expenses in the consolidated statement of profit or loss.
As at 30 June 2022, current trade receivables and accrued revenue of $303,760,000 (2021: $283,413,000) were assessed for
expected credit losses. Of this $11,518,000 (2021: $42,246,000) were past due. The amount of the provision for impaired and
expected credit loss receivables was $10,980,000 (2021: $13,097,000).
The Group applies the AASB 9 simplified approach to measuring expected credit losses which uses a lifetime expected credit
loss allowance for trade receivables and accrued revenue.
Expected credit losses are based on a review of payment profiles over 12 months, historical credit loss experience in this
period and financial information affecting the ability of the customers to settle the receivable. Historical loss rates are
adjusted to reflect balances receivable or otherwise provided for. Accrued revenue relates to unbilled completed services and
has substantially the same characteristics as the trade receivables for the same type of contracts. The historical loss rates are
adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of the customers
to settle the receivables. The Group has identified that the external credit ratings and default rates are the most relevant
factors in understanding whether a client will be able to settle the receivable and therefore these have been considered and
applied to the receivables to arrive at an expected credit loss. Following this review a provision of $797,000 (2021: $397,000)
has been recorded for expected credit losses and has been included within the provision for doubtful debts balance at
30 June 2022.
The aging of trade receivables greater than 90 days past due and excluding provisions for doubtful debts and expected credit
losses are:
3 to 6 months
Over 6 months
22
$’000
930
8,619
9,549
21
$’000
3,350
12,983
16,333
Movements in the provision for impairment and expected credit losses of trade receivables and accrued revenue that are
assessed collectively are as follows:
22
$’000
13,097
8,451
(10,968)
400
10,980
21
$’000
11,172
10,997
(8,521)
(551)
13,097
At 1 July
Provision recognised during the year
Utilisation of provision
Expected credit loss provision movement
At 30 June
130
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 11 FINANCIAL RISK MANAGEMENT (CONTINUED)
(c)
Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of funding
through an adequate amount of committed credit facilities and the ability to close out market positions. The Group manages
liquidity risk by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets
and liabilities. Due to the dynamic nature of the underlying businesses, the Group aims at maintaining flexibility in funding by
keeping committed credit lines available with a variety of counterparties.
(i) Maturities of financial liabilities
The tables below analyse the Group’s financial liabilities into relevant maturity groupings based on the remaining period at
the reporting date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted
cash flows.
Contractual maturities
of financial liabilities
Less than
6 months
6 - 12
months
Between 1
and 2 years
Between 2
and 5 years
Group - at 30 June 2022
$’000
$’000
$’000
$’000
Over 5
years
$’000
Total
contractual
cash flows
Carrying
amount
liabilities
$’000
$’000
Trade payables
Lease liabilities
Borrowings
Total
Group - at 30 June 2021
Trade payables
Lease liabilities
Borrowings
Total
393,298
17,172
26,058
436,528
260,311
14,345
23,008
297,664
-
13,540
23,577
37,117
-
16,102
23,008
39,110
-
-
-
393,298
393,298
14,806
243,271
258,077
12,759
717,438
730,197
4,548
62,825
56,193
-
1,010,344
845,664
4,548
1,466,467
1,295,155
-
30,751
44,797
75,548
-
26,488
795,583
822,071
-
10,714
260,311
98,400
-
886,396
260,311
73,809
694,191
10,714
1,245,107
1,028,311
The amounts disclosed in the table are the maximum amounts allocated to the earliest period in which the guarantee could
be called. The parent entity does not expect these payments to eventuate.
131
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 12 CAPITAL MANAGEMENT
(a) Risk management
The Group’s capital management objectives are to ensure there is adequate funding to meet operation requirements,
strategic objectives and to provide returns to shareholders through cost effective and efficient capital structuring.
The Group manages its capital needs through a combination of equity and debt funding arrangements. The Group uses a
number of different measures to monitor capital including gearing ratio, cash flow leverage ratios and net debt ratios.
(b) Dividends
(i) Dividends paid in the reporting period
Prior year unfranked dividend of 2.0 cents per ordinary share paid 20 October 2021
(2020: 3.5 cents paid 3 November 2020).
No interim dividends were determined for the year ended 30 June 2022 (2021:
unfranked interim dividend of 3.5 cents per ordinary share paid 7 April 2021).
Total dividends provided for or paid
22
$’000
21
$’000
14,108
24,563
-
14,108
24,707
49,270
Dividends paid in cash or satisfied by the issue of shares under the dividend reinvestment plan during the years ended
30 June 2022 and 30 June 2021 were:
Paid in cash
Movement in payable
Issue of shares under dividend re-investment plan
Total dividends provided for or paid
14,108
-
-
14,108
63,482
(15,174)
962
49,270
The Company’s Dividend Reinvestment Plan (DRP) was suspended with effect from 16 March 2021 until further notice.
(ii) Dividends not recognised at the end of the reporting period
No final dividends were determined for the year ended 30 June 2022 (2021:
unfranked final dividend of 2.0 cents per ordinary share paid 20 October 2021).
(iii) Conduit Foreign Income
22
$’000
21
$’000
-
14,086
22
$’000
21
$’000
Conduit Foreign Income (CFI) amounts for subsequent reporting periods are
486,026
339,948
These balances are taken from the CFI register and are available to pay dividends. The CFI register is adjusted for foreign
income received, withholding tax incurred and dividends paid. Unlike franked dividends no tax credit accompanies a dividend
paid out of a CFI balance.
(c)
Share buy-back
The Company has implemented its capital management strategy which includes the buy-back of shares on market.
In the year ended 30 June 2022, 3.3 million shares were bought back by the Company for a consideration of $2.0 million.
At 30 June 2022, $0.9 million had been paid in cash and the remaining amount payable is recorded in other creditors and
accruals in note 6(c).
132
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 13 BUSINESS COMBINATION
On 1 February 2022 the Group, through its subsidiary idoba Pty Ltd, acquired two technology companies, namely, Orelogy
Consulting Pty Ltd and Atomorphis Pty Ltd. The total consideration paid for these transactions included $3.75 million of cash.
Other balances recognised as part of the acquisitions included goodwill of $2.5 million and software intangibles of $0.7million.
The transactions were not considered material, individually or in aggregate, to the Group.
During the year ended 30 June 2021 the Group acquired three entities as part of a single transaction, through its subsidiary idoba
Pty Ltd. These transactions were not considered material to the Group. Refer to the 30 June 2021 Annual Report for further details
of these transactions.
133
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 14 INTERESTS IN OTHER ENTITIES
The consolidated financial statements incorporate the assets, liabilities and results of Perenti Global Limited, the ultimate parent
entity, and the following principal subsidiaries in accordance with the accounting policy described in note 25(b):
Name of entity
Country of incorporation
and principal place of
business
Class of
shares
Equity holding
21
22
%
%
African Mining Services Burkina Faso Sarl
African Mining Services (Ghana) Pty Ltd *
African Mining Services Guinee Sarl
African Mining Services Mali Sarl
African Mining Services Senegal Suarl
Ausdrill (Ghana) Pty Ltd *
ACN 103534087 Pty Ltd *
African Mining Services Cote D’Ivoire Sarl
African Mining Services Ghana Ltd
Perenti Group Services Pty Ltd *
Perenti International Pty Ltd *
Ausdrill Pty Ltd *
Perenti Properties Pty Ltd *
Perenti Finance Pty Ltd *
AMCG Ltd
Perenti Holdings Pty Ltd
Ausdrill Tanzania Limited
Perenti Utilities Pty Ltd *
BTP Equipment Pty Ltd *
BTP Parts Pty Ltd *
Connector Drilling Pty Ltd *
Ausdrill Mining Surface Botswana Proprietary Ltd
Drill Rigs Australia Pty Ltd *
Energy Drilling Australia Pty Ltd
Golden Plains Pty Ltd *
Barminco Mining Services Botswana Proprietary Ltd
MinAnalytical Laboratory Services Australia Pty Ltd
MinAnalytical Holdings Pty Ltd *
Logistics Direct Ltd
Perenti UK Ltd
Power Solutions Africa Suarl
Mining Technology and Supplies Ltd
Barminco Mining Services Canada Limited
Supply Direct Pty Ltd (United Kingdom Branch)*
Barminco Finance Pty Ltd *
Barminco Holdings Pty Ltd *
Supply Direct South Africa Pty Ltd *
Barminco Limited *
Supply Direct Pty Ltd *
Synegex Holdings Pty Ltd *
Barholdco (EIS) Pty Ltd
Barminco South Africa Pty Ltd
Barminco Egypt LLC
West African Mining Services Ltd
Barminco Egypt Underground Mining Services
SAE Investment Commercial
SLR Australia Pty Ltd
Barminco India Holdings Pty Ltd
Barminco India Investments Pty Ltd
Barminco AUMS Holding Pty Ltd *
Barminco Indian Underground MIning Services LLP
African Underground Mining Services Limited
African Underground Mining Services Ltd Mali Sarl
Underground Mining Alliance Ltd
African Underground Mining Services Burkina Faso Sarl
Barminco Mining Services USA LLC
Perenti USA Inc
AUMS (T) Limited
Improvement Resources Pty Ltd
idoba Pty Ltd (formerly Technology Driven Mining)
Sandpit Innovation Pty Ltd
Spidler Technologies Pty Ltd
Optika Solutions Pty Ltd
BG Umoja Services Limited
Spidler Group Pty Ltd
AMAX Ltd
Atomorphis Pty Ltd
Orelogy Consulting Pty Ltd
Burkina Faso
Australia
Guinea
Mali
Senegal
Australia
Australia
Cote d’Ivoire
Ghana
Australia
Australia
Australia
Australia
Australia
Ghana
Australia
Tanzania
Australia
Australia
Australia
Australia
Botswana
Australia
Australia
Australia
Botswana
Australia
Australia
Ghana
UK
Senegal
Ghana
Canada
United Kingdom
Australia
Australia
Australia
Australia
Australia
Australia
Australia
South Africa
Egypt
Ghana
Egypt
Australia
Australia
Australia
Australia
India
Ghana
Mali
Ghana
Burkina Faso
USA
USA
Tanzania
Australia
Australia
Australia
Australia
Australia
Tanzania
Australia
Ghana
Australia
Australia
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
-
100
100
-
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
70
100
100
100
96
96
96
96
96
96
80
96
60
96
96
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
70
100
100
100
96
96
96
96
96
96
80
96
60
-
-
Underground Mining Alliance (UMA) is a 70/30 operation between AUMS and Rocksure International, a Ghanaian Mining contractor and has been included in subsidiaries above.
BG Umoja Services Limited is a 80/20 operation between Perenti International Pty Ltd, Barminco AUMS Holding Pty Ltd and Geofields Tanzania Limited, a Tanzanian Mining
Contractor, and has been included in subsidiaries above.
AMAX Ltd is a 60/40 operation between African Mining Services (Ghana) Pty Ltd and MAXMASS Ltd, a Ghanaian Mining Contractor, and has been included in subsidiaries above.
During the year the MinAnalytical Laboratory Services Australia Pty Ltd (refer to 3(b) for further detail) and Energy Drilling Australia Pty Ltd were divested.
* These subsidiaries have been granted relief from the necessity to prepare financial reports in accordance with ASIC Corporations (wholly-owned Companies) Instrument
2016/785. For further information refer to note 23.
134
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 15 CONTINGENCIES
(a) Contingent liabilities
In the course of business, liabilities may arise from different events including contractual disputes, litigations and other claims.
The outcomes from these events cannot be predicted or in the opinion of directors are without merit and therefore no
amounts have been disclosed.
For information about guarantees given by entities within the Group, including the parent entity, please refer to note 24.
(b) Contingent assets
The Group lodged a claim in relation to a matter which at 30 June 2022 was unresolved and is subject to litigation.
The contingent asset has not been recognised as a receivable at 30 June 2022 as receipt of this amount is dependent on the
outcome of the litigation. Refer to note 17 for an update on this matter that have arisen since the end of the financial year.
16 COMMITMENTS
(a) Capital commitments
Capital expenditure that was contracted at the end of the reporting period but not recognised as liabilities:
Property, plant and equipment
Payable:
Within one year
The capital commitments are to be funded from cash and available finance facilities.
17 EVENTS SINCE THE END OF THE FINANCIAL YEAR
22
$’000
21
$’000
114,169
92,013
On 18 July 2022, the Group announced it has entered into a settlement agreement to recover $10 million related to historical
damages caused to a property in West Africa. The settlement amount is before fees and taxes and will have a positive impact to
FY23 statutory earnings.
On 22 August 2022, the Group announced it executed a Share Sale Agreement for the sale of 10% of the issued shares in idoba Pty
Ltd to the Sumitomo Corporation for a total cash consideration of $5.4 million.
There are no other matters or circumstances that have arisen since the end of the financial year which significantly affected or
may significantly affect the operations of the Consolidated entity, the results of those operations, or the state of affairs of the
Consolidated entity in subsequent financial years.
135
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 18 RELATED PARTY TRANSACTIONS
(a)
Parent entity
The ultimate parent entity of the Group is Perenti Global Limited.
(b) Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Long-term benefits
Share-based payments
22
$
21
$
4,760,029
3,903,542
142,652
21,132
1,686,881
6,610,694
140,675
67,012
1,620,819
5,732,048
Detailed remuneration disclosures are provided in the remuneration report on pages 68 to 85.
(c)
Transactions with other related parties
Other than disclosed above and in this note the Group has no other material related parties. As disclosed in note 14,
the Group has non-controlling interests, however these are not considered material for the year ended 30 June 2022.
Transactions with the non-controlling interests include loans from the non-controlling interest of $1,158,000 (2021:
$1,290,000) (note 18(d)), Loans to the non-controlling interest of $1,703,000 (2021: $2,094,000), dividends paid to non-
controlling interest of $2,610,000 (2021: $nil), and rental and hire expenses of $18,219,000 (2021: $nil).
(d)
Loans to related parties
Loans to key management personnel
Balance at 1 July
Interest charged
Interest received
As at 30 June
22
$
186,039
8,492
(8,492)
186,039
21
$
187,512
8,964
(10,437)
186,039
Terms and conditions
Loans provided to key management personnel on acquisition of the Barminco group. Loans are repayable by 22 October
2022, interest was payable at a rate of 4.52% (2021: 4.80% and 4.52%) on loans advanced. Outstanding balances are
unsecured and are repayable in cash.
Loans from non-controlling interest
Balance at 1 July
Loan repayments made
Impact of foreign exchange
Loan drawdowns
As at 30 June
22
$
21
$
1,290,008
2,705,255
(1,867,355)
(1,200,008)
89,427
(215,239)
1,646,585
1,158,665
-
1,290,008
136
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 19 SHARE-BASED PAYMENTS
(a)
Employee Option Plan
The Employee Option Plan was designed to provide long-term incentives for senior managers to deliver long-term
shareholder returns. Since the Barminco transaction in 2019 no new option plans have been granted with these being
replaced by rights plans as disclosed in section (b) of this note. The final exercises under the option plans occurred in
December 2020.
During the year ended 30 June 2021 all options under the Employee Option Plans were either exercised (733,338 shares at
average exercise price of $0.17) or forfeited (466,668 shares at average exercise price of $1.15) and therefore at 30 June 2021
there are no unvested options and the Employee Option Plans terminated. As the option plans were finalised in the prior
year there were no options granted during the year ended 30 June 2022 (2021: Nil). Refer to 30 June 2021 Annual Report for
further details.
(b) Rights Plan
The Board had established an Incentive Rights Plan for eligible employees holding senior executive and senior management
roles with a focus on delivering outcomes that create value for shareholders. The plan allows for three different types of
incentive rights; retention rights, performance rights and short-term incentive rights. Performance rights were granted during
the year and are treated in substance as options and are accounted for as share-based payments. Participation under the
plan is at the Board’s discretion and no individual has a contractual right to participate in the plan or receive any guaranteed
benefits. Rights granted for nil consideration under the plan carry no dividend or voting rights.
Retention rights
Each retention right issued under the plan converts into one ordinary share of Perenti Global Limited on exercise. During the
year ended 30 June 2022 3,240,473 retention rights were granted. Retention rights are not subject to performance hurdles
and will vest on 31 December 2023.
Short-term incentive rights
Each short-term incentive right issued under the plan converts into one ordinary share of Perenti Global Limited on exercise.
Certain Executive’s are invited to participate in the plan. Short-term incentive rights are based upon business outcomes which
comprise of a mix of financial and non-financial measures. The Board retains absolute discretion with respect to the targets
and outcomes assessed under the plan. The short-term incentives vest twelve months after the grant date.
Performance rights
Each performance right issued under the plan converts into one ordinary share of Perenti Global Limited on exercise.
Performance rights vest and become exercisable when the applicable performance, service or other vesting conditions
specified at the time of grant are satisfied within a predetermined performance period.
The performance period for the rights granted during the year end 30 June 2022 will run from 1 July 2021 until 30 June 2024,
(2021: 1 July 2020 until 30 June 2023). In addition to continued service, the Board changed the performance criteria for the
rights granted in FY22 to the below terms:
• 50% of the performance rights will vest if the total shareholder return (TSR) vesting condition is met which are on sliding
scale based upon the TSR benchmark as disclosed in the remuneration report;
• 30% of the performance rights will vest if the return on equity (ROE) vesting condition is met which are on sliding scale of
ROE outcomes between 6% and 6.8% as disclosed in the remuneration report;
• 10% of the performance rights will vest if the strategic initiative regarding a psychological safe work environment is met;
and
• 10% of the performance rights will vest if the strategic initiative regarding reducing debt leverage to sub 1.0 times EBITDA,
excluding possible acquisitions, as aligned to the Capital Management Policy introduced in December 2021.
Set out below is a summary of rights granted under the above plans.
As at 1 July
Granted during the year
Forfeited during the year
Vested during the year
As at 30 June
22
Number of
rights
13,052,162
15,276,873
21
Number of
rights
9,644,034
5,891,669
(3,234,420)
(1,259,189)
(1,415,972)
(1,224,352)
23,678,643
13,052,162
137
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 19 SHARE-BASED PAYMENTS (CONTINUED)
(b) Rights Plan (continued)
There were 11,047,923 performance rights, 988,477 Short Term Incentive Rights and 3,240,473 retention rights granted
during the year ended 30 June 2022 (30 June 2021: 5,607,028 performance rights and 284,641 Short Term Incentive Rights
and nil retention rights). During the year ended 30 June 2022 1,969,831 performance rights for Mr Norwell (Managing
Director & CEO) are awaiting grant at Perenti’s Annual General Meeting if approved by the Shareholders.
The weighted average remaining contractual life of rights outstanding at the end of the year was 1.40 years (30 June 2021:
1.13 years). The weighted fair value of rights granted during the year $0.61 (30 June 2021: $0.66).
An independent third party valuer provided a valuation report with the following inputs used to determine the fair value of
rights at the grant date:
Right
Grant date
Performance
period end date
Performance - ROACE
28 Feb 2019
30 Jun 2021
Performance - TSR
28 Feb 2019
30 Jun 2021
Retention
28 Feb 2019
31 Oct 2020
Performance - ROACE
10 Jun 2019
30 Jun 2021
Performance - TSR
10 Jun 2019
30 Jun 2021
Performance - ROACE
28 Nov 2019
30 Jun 2022
Performance - TSR
28 Nov 2019
30 Jun 2022
Short Term Incentive Plan
24 Oct 2019
30 Jun 2019
Short Term Incentive Plan
10 Nov 2020
30 Jun 2020
Performance - ROACE
9 Apr 2021
30 Jun 2023
Performance - TSR
9 Apr 2021
30 Jun 2023
Performance - ROACE
28 May 2021
30 Jun 2023
Performance - TSR
28 May 2021
30 Jun 2023
Short Term Incentive Plan
8 Oct 2021
30 Jun 2021
Performance - TSR
13 May 2022
30 Jun 2024
Performance - ROE
13 May 2022
30 Jun 2024
Performance - Others
13 May 2022
30 Jun 2024
Retention
9 Jun 2022
31 Dec 2023
Share price
grant date
Expected
volatility
Dividend
yield
Risk-free
interest rate
Fair value
grant date
$
1.74
1.74
1.74
1.33
1.33
1.95
1.95
1.84
1.13
1.13
1.13
0.67
0.67
0.95
0.69
0.69
0.69
0.74
%
%
54.92
54.92
54.92
52.07
52.07
46.00
46.00
-
-
64.00
64.00
67.00
67.00
-
65.23
65.23
65.23
-
3.74
3.74
3.74
3.74
3.74
3.60
3.60
3.74
6.19
6.19
6.19
10.53
10.53
5.79
2.90
2.90
2.90
2.70
%
1.67
1.67
1.67
1.07
1.07
0.66
0.66
-
-
0.12
0.12
0.08
0.08
-
2.64
2.64
2.64
-
$
1.60
1.22
1.64
1.23
0.82
1.78
1.33
1.88
1.06
0.99
0.62
0.54
0.21
0.90
0.45
0.65
0.65
0.71
(c)
Expenses arising from share-based payment transactions
Total expenses arising from share-based payment transactions recognised during the period as a part of employee benefit
expense were:
Rights issued under employee rights plan
22
$’000
4,591
21
$’000
2,033
The total amount to be expensed for share-based payments is determined by reference to the fair value at grant date, which
includes any market performance conditions and the impact of any non-vesting conditions but excludes the impact of any
service and non-market performance vesting conditions. Non-market vesting conditions are included in assumptions about
the number of options or rights that are expected to vest. The total expense is recognised over the vesting period. At the end
of each reporting period, the Group revises its estimate of the number of equity instruments expected to vest based on non-
market vesting conditions. The impact of the revision of the original estimates, if any, is recognised in profit or loss such that
the cumulative expense reflects the revised estimates, with a corresponding adjustment to the share-based payments reserve.
Significant judgement is required in determining the achievement of non-market conditions.
The fair value at grant date is independently determined using a Monte Carlo simulation or an amended Black Scholes Merton
methodology valuation model. The fair value at the grant date of the equity settled share-based payments is expensed on a
straight-line basis over the vesting period, based on the Group’s estimate of equity instruments that will eventually vest, with a
corresponding increase in equity.
At the end of each reporting period, the Group revises its estimate of the number of equity instruments expected to vest
based on non-market vesting conditions. The impact of the revision of the original estimates, if any, is recognised in profit
or loss such that the cumulative expense reflects the revised estimates, with a corresponding adjustment to the share-based
payments reserve.
138
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 20 REMUNERATION OF AUDITORS
During the year the following fees were paid for services provided by the auditor of the parent entity, its related practices and non-
related audit firms:
(a)
PricewaterhouseCoopers Australia
Audit and review of financial statements of the group and controlled entities*
Tax compliance services
Advisory and accounting consulting services
22
$
444,800
380,058
361,559
21
$
1,205,168
499,719
515,250
Total remuneration of PricewaterhouseCoopers Australia
1,186,417
2,220,137
(b) Network firms of PricewaterhouseCoopers Australia
Audit and other assurance services
Tax compliance services
Advisory and accounting consulting services
715,609
359,831
119,598
868,835
235,124
72,202
Total remuneration of network firms of PricewaterhouseCoopers Australia
1,195,038
1,176,161
Total remuneration of PricewaterhouseCoopers firms
2,381,455
3,396,298
(c) Non PricewaterhouseCoopers audit firms
Audit and review of financial statements of the group and controlled entities
Tax compliance services
Advisory and accounting consulting services
Total remuneration of non PricewaterhouseCoopers audit firms
155,075
166,258
328,239
649,572
153,763
165,963
636,235
955,961
* The audit fee for the year for PwC Australia was $897,703 compared to $747,030 in the prior year. The above note is prepared on a cash basis and the difference to the
fee agreed is due to timing of invoicing and payments.
It is the Group’s policy to employ PricewaterhouseCoopers on assignments additional to their statutory audit duties where
PricewaterhouseCoopers expertise and experience with the Group are important. These assignments are principally tax
advice and due diligence reporting on acquisitions, or where PricewaterhouseCoopers is awarded assignments on a
competitive basis.
139
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 21 EARNINGS PER SHARE
(a)
Basic earnings/(loss) per share
From continuing operations attributable to the ordinary equity holders of the Company
22
Cents
5.8
21
Cents
(7.8)
(b) Diluted earnings/(loss) per share
From continuing operations attributable to the ordinary equity holders of the Company
5.7
(7.8)
(c) Reconciliation of earnings used in calculating earnings per share
Profit/(loss) attributable to the ordinary equity holders of the Company used in
calculating basic and diluted earnings per share
(d) Weighted average number of shares used as denominator
22
$’000
21
$’000
40,658
(55,140)
22
Number
21
Number
Weighted average number of ordinary shares used as the denominator in calculating
basic earnings per share
705,364,418
703,365,307
Adjustments for calculation of diluted earnings per share:
Effect of share rights on issue
Weighted average number of ordinary and potential ordinary shares used as the
denominator in calculating diluted earnings per share
3,166,764
-
708,531,182
703,365,307
The number of potential ordinary shares not considered dilutive at 30 June 2022 is 10,998,465 (2021: 8,305,205).
(e)
Information on the classification of securities
Rights
Rights granted to employees are considered to be potential ordinary shares and have been included in the determination of
diluted earnings per share to the extent to which they are dilutive. The rights have not been included in the determination of
basic earnings per share. Details relating to the rights are set out in note 19.
(f)
Accounting policy
(i) Basic earnings per share
Basic earnings per share is calculated by dividing:
•
the profit attributable to equity holders of the Company, excluding any costs of servicing equity other than ordinary
shares;
• by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in
ordinary shares issued during the year.
(ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:
the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares, and
•
•
the weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential
ordinary shares.
140
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 22 ASSETS PLEDGED AS SECURITY
The carrying amounts of assets pledged as security for current and non-current borrowings are:
Current
Floating charge
Cash and cash equivalents
Receivables
Inventory
Assets classified as held for sale
Total current assets pledged as security
Non-current
Floating charge
Plant and equipment
Land and buildings
Receivables
Investment
Total non-current assets pledged as security
22
$’000
21
$’000
261,853
383,119
178,604
7,488
831,064
747,018
24,402
128,911
95,156
995,487
207,856
291,506
170,585
-
669,947
565,497
53,844
124,679
120,032
864,052
Total assets pledged as security
1,826,551
1,533,999
Restrictions and covenants imposed under leasing agreements over right-of-use assets are disclosed in note 7(d) and therefore not
included in this disclosure.
141
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 23 DEED OF CROSS GUARANTEE
Perenti Global Limited and the entities identified with a ‘*’ in note 14 are parties to a deed of cross guarantee under which each
company has guaranteed the debts of the others. By entering into the deed, the wholly-owned entities have been relieved from the
requirement to prepare a financial report and a directors’ report under ASIC Corporations (wholly-owned Companies) Instrument
2016/785.
(a) Consolidated statement of profit or loss, consolidated statement of comprehensive income and summary of
movements in consolidated retained earnings
The above companies represent a ‘closed group’ for the purposes of the instrument, and as there are no other parties to the
deed of cross guarantee that are controlled by Perenti Global Limited, they also represent the ‘extended closed group’.
Set out below is a consolidated statement of profit or loss, a consolidated statement of comprehensive income and a
summary of movements in consolidated retained earnings for the closed group.
Consolidated statement of profit or loss
Revenue from continuing operations
Other income
Materials expense
Labour costs
Rental and hire expense
Depreciation expense
Amortisation expense
Finance costs
Finance income
Other expenses from ordinary activities
Impairment of assets
Profit before income tax
Income tax benefit
Profit for the year
Consolidated statement of comprehensive income
Other comprehensive income
Profit for the year
Items that may be reclassified to profit or loss
22
$’000
21
$’000
1,147,881
232,470
(350,800)
(587,625)
(17,633)
(118,777)
(26,954)
(52,215)
16,121
(195,373)
(23,162)
23,933
36,451
60,384
998,219
116,083
(302,861)
(486,877)
(10,773)
(104,641)
(38,571)
(61,667)
12,108
(91,807)
(8,059)
21,154
23,196
44,350
60,384
44,350
Exchange differences on translation of foreign operations
(27,053)
9,203
Items that will not be reclassified to profit or loss
Gain on revaluation of land and buildings
Gain on revaluation of financial assets FVOCI, net of tax
Other comprehensive (loss)/income for the year, net of tax
Total comprehensive income for the year
Summary of movements in consolidated retained earnings
Retained earnings at the beginning of the financial year
Profit for the year
Retained earnings transfer
Dividends paid
Retained earnings at the end of the financial year
-
21,762
(5,291)
55,093
153,326
60,384
100,665
(14,108)
300,267
4,008
1,333
14,544
58,894
270,180
44,350
(110,532)
(50,672)
153,326
The retained earnings transfer relates to movements in entities entering or exiting the deed of cross guarantee. The 30 June
2022 balance reflects the removal of MinAnalytical Laboratory Services Australia Pty Ltd and Energy Drilling Australia Pty Ltd.
The 30 June 2021 reflects the Barminco Australian entities entering the Deed.
142
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 23 DEED OF CROSS GUARANTEE (CONTINUED)
(b) Consolidated statement of financial position
Set out below is the consolidated statement of financial position as at 30 June of the closed group.
Current assets
Cash and cash equivalents
Trade receivables
Inventories
Current tax receivables
Assets classified as held for sale
Total current assets
Non-current assets
Investments in other Group companies
Receivables
Financial assets at fair value through other comprehensive income
Property, plant and equipment
Deferred tax assets
Right-of-use assets
Intangible assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Borrowings
Lease liabilities
Current tax liabilities
Employee benefit obligations
Total current liabilities
Non-current liabilities
Borrowings
Lease liabilities
Deferred tax liabilities
Employee benefit obligations
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Other reserves
Retained earnings
Total equity
22
$’000
109,603
337,517
79,295
10,657
-
537,072
504,094
303,773
-
444,317
166,204
47,890
634,728
2,101,006
21
$’000
98,746
186,722
91,232
13,762
28,894
419,356
496,266
152,125
25,536
394,971
139,055
70,057
666,585
1,944,595
2,638,078
2,363,951
206,039
145,766
1,926
27,943
10,608
56,527
1,829
22,729
13,389
54,411
303,043
238,124
852,607
16,670
55,810
3,909
928,996
691,102
55,320
74,941
2,656
824,019
1,232,039
1,062,143
1,406,039
1,301,808
1,137,030
1,137,783
(31,258)
300,267
10,699
153,326
1,406,039
1,301,808
143
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 24 PARENT ENTITY FINANCIAL INFORMATION
(a)
Summary financial information
The individual financial statements for the parent entity, Perenti Global Limited, show the following aggregate amounts:
Balance sheet
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Shareholders’ equity
Contributed equity
Other reserves
Asset revaluation reserve
Share-based payments reserve
Accumulated losses - 2015 reserve
Accumulated losses - 2020 reserve
Retained Earnings
Total equity
Profit for the year
Total comprehensive income
22
$’000
7,372
949,156
956,528
352
7,949
8,301
21
$’000
5,937
901,114
907,051
929
8,074
9,003
1,137,030
1,137,783
3,213
13,872
(183,177)
(78,556)
55,845
948,227
63,881
63,881
3,213
13,096
(183,177)
(78,556)
5,689
898,048
54,903
54,903
The financial information for the parent entity has been prepared in accordance with the accounting policies below.
(b) Guarantees entered into by the parent entity
The parent entity has not entered into any guarantees during the year (2021: nil).
However, there are cross guarantees given by Perenti Global Limited as described in note 23. Net asset deficiencies exist in
some of the subsidiaries covered by the deed of cross guarantee.
(c) Contingent liabilities of the parent entity
The parent entity did not have any contingent liabilities as at 30 June 2022 or 30 June 2021.
(d) Contractual commitments for the acquisition of property, plant or equipment
As at 30 June 2022, the parent entity had $nil contractual commitments for the acquisition of property, plant and equipment
(30 June 2021: $nil).
(e)
Accumulated losses - reserves
Each reserve of the parent entity has the same nature and purpose as described for the consolidated Group (in note 8(b)).
In addition, the parent entity on 30 June 2020 and 30 June 2015 established separate reserves for the purpose of paying
future dividends. The reserves are referred to as “Accumulated losses - 2020” and the “Accumulated losses - 2015 reserve”.
On the date of establishment, the “Accumulated losses - 2020” had an amount of ($78,556,000) transferred to it from
retained earnings and the “Accumulated losses - 2015 reserve” had an amount of ($183,177,000) transferred to it from
retained earnings.
144
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 24 PARENT ENTITY FINANCIAL INFORMATION (CONTINUED)
(f)
Parent entity financial information
The financial information for the parent entity, Perenti Global Limited has been prepared on the same basis as the
consolidated financial statements, except as set out below.
(i) Investments in subsidiaries, associates and joint venture entities
Investments in subsidiaries, associates and joint venture entities are accounted for at cost in the financial statements of
Perenti Global Limited. Dividends received from associates are recognised in the parent entity’s profit or loss when its right to
receive the dividend is established.
(ii) Tax consolidation legislation
Perenti Global Limited and its wholly-owned Australian controlled entities have implemented the tax consolidation
legislation.
The head entity, Perenti Global Limited, and the controlled entities in the tax consolidated group account for their own
current and deferred tax amounts. These tax amounts are measured as if each entity in the tax consolidated group continues
to be a stand-alone taxpayer in its own right.
In addition to its own current and deferred tax amounts, Perenti Global Limited also recognises the current tax liabilities (or
assets) and the deferred tax assets arising from unused tax losses and unused tax credits assumed from controlled entities in
the tax consolidated Group.
The entities have also entered into a tax funding agreement under which the wholly-owned entities fully compensate Perenti
Global Limited for any current tax payable assumed and are compensated by Perenti Global Limited for any current tax
receivable and deferred tax assets relating to unused tax losses or unused tax credits that are transferred to Perenti Global
Limited under the tax consolidation legislation. The funding amounts are determined by reference to the amounts recognised
in the wholly-owned entities’ financial statements.
The amounts receivable/payable under the tax funding agreement are due upon receipt of the funding advice from the head
entity, which is issued as soon as practicable after the end of each financial year. The head entity may also require payment of
interim funding amounts to assist with its obligations to pay tax instalments.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as current amounts
receivable from or payable to other entities in the Group.
Any difference between the amounts assumed and amounts receivable or payable under the tax funding agreement are
recognised as a contribution to (or distribution from) wholly-owned tax consolidated entities.
(iii) Financial guarantees
Where the parent entity has provided financial guarantees in relation to loans and payables of subsidiaries for no
compensation, the fair values of those guarantees are accounted for as contributions and recognised as part of the cost of
the investment.
(iv) Share-based payments
The grant by the Company of rights over its equity instruments to the employees of subsidiary undertakings in the Group
is treated as a capital contribution to that subsidiary undertaking. The fair value of employee services received, measured
by reference to the grant date fair value, is recognised over the vesting period as an increase to investment in subsidiary
undertakings, with a corresponding credit to equity.
145
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 25 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This note provides a list of all significant accounting policies adopted in the preparation of these consolidated financial statements
which haven’t been disclosed elsewhere in this document. These policies have been consistently applied to all the periods
presented, unless otherwise stated. The financial statements are for the consolidated entity consisting of Perenti Global Limited and
its subsidiaries.
(a)
Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards,
and Interpretations issued by the Australian Accounting Standards Board, Urgent Issues Group Interpretations and the
Corporations Act 2001. Perenti Global Limited is a for-profit entity for the purpose of preparing the financial statements.
(i) Compliance with IFRS
The consolidated financial statements of Perenti Global Limited and its subsidiaries also comply with International Financial
Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
(ii) New or amended Accounting Standards and Interpretations adopted by the Group
The Group has adopted all of the new, revised or amending Accounting Standards and Interpretations issued by the Australian
Accounting Standards Board (‘AASB’) that are mandatory for the current reporting period.
• AASB 2020-4 Amendments to Australian Accounting Standards - Covid-19-Related Rent Concessions [AASB 16];
• AASB 2020-8 Amendments to Australian Accounting Standards - Interest Rate Benchmark Reform - Phase 2 [AASB 4,
AASB 7, AASB 9, AASB 16 and AASB 139];
• AASB 2020-3 Amendments to Australian Accounting Standards - Annual Improvements 2018-2020 and Other
Amendments [AASB 1, AASB 3, AASB 9, AASB 116, AASB 137 and AASB 141], and
• AASB 2021-5 Amendments to Australian Accounting Standards - Deferred Tax related to Assets and Liabilities arising from
a Single Transaction [AASB 112].
The amendments listed above did not have any impact on the amounts recognised in prior periods and are not expected to
significantly affect the current or future periods.
(iii) Impact of standards issued but not yet adopted by the Group
Certain new accounting standards and interpretations have been published that are not mandatory for the 30 June 2022
reporting period and have not been early adopted by the Group. The Group is assessing impact of the new standards,
however does not expect to have a material impact on the Group in the current or future reporting periods and on
foreseeable future transactions.
(iv) International Financial Reporting Standards Interpretations Committee final agenda decisions adopted
The International Financial Reporting Standards Interpretations Committee (IFRIC) has issued two final agenda decisions to
provide guidance on AASB 138 Intangible Assets which impact Software-as-a-Service (SaaS) arrangements covering:
• A customer’s right to receive access to the supplier’s software hosted on the cloud (March 2019). This decision considers
whether a customer receives a software asset at the contract commencement date or a service over the contract term.
• Configuration or customisation costs in a cloud computing arrangement (March 2021). This decision discusses whether
configuration or customisation expenditure relating to SaaS arrangements can be recognised as an intangible asset and if
not, over what time period the expenditure is expensed.
The Group’s accounting policy has historically been to capitalise costs predominantly related to acquisition, configuration
and customisation activities that are related to cloud computing arrangements as intangible assets (software) in the
consolidated statement of financial position. The Group has since adopted the IFRIC decisions in the year ended 30 June
2022 and updated its accounting policy for SaaS related intangibles as presented below.
Software-as-a-Service (SaaS) arrangements
SaaS arrangements are service contracts providing the Group with the right to access the cloud provider’s application
software over the contract period. As such the Group does not receive a software intangible asset at the contract
commencement date. A right to receive future access to the supplier’s software does not, at the contract commencement
date, give the customer the power to obtain the future economic benefits from the software itself.
The following outlines the accounting classification of costs incurred in relation to SaaS arrangements:
Recognise as an operating expense over the term of the service contract
- Fee for use of application software
Recognise as an operating expense as the service is received
- Customisation costs (non-distinct services)
- Configuration costs (non-distinct services)
- Data conversion and migration costs
- Customisation costs (non-distinct services)
- Configuration costs (non-distinct services)
- Testing costs
- Employee training costs
146
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 25 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(a)
Basis of preparation (continued)
(iv) International Financial Reporting Standards Interpretations Committee final agenda decisions adopted (continued)
Software-as-a-Service (SaaS) arrangements (continued)
Costs incurred for the development of software code that enhances or modifies, or creates additional capability to existing
on-premise systems and meets the definition of and recognition criteria for an intangible asset are recognised as intangible
software assets. Refer to Note 7(e) of the 30 June 2021 Annual report for an outline of the Group’s previous accounting policy
for intangible assets.
The change in accounting policy has resulted in a retrospective reclassification of certain intangible assets as an expense in
the Consolidated Statement of Comprehensive Income, impacting both the current and prior periods. Prior period retained
earnings in the Consolidated Statement of Changes in Equity has been adjusted by $4.6 million with the corresponding
reduction to Property, Plant and Equipment in the Consolidated Statement of Financial Position. The adjustment is not
material to the financial statements of the Group and therefore full restatement disclosures have not been prepared.
The change in policy has been applied retrospectively and comparative information has been restated. This had the following
impact on the amounts recognised in the financial statements:
Balance Sheet
Property, plant and equipment
Retained earnings
30 June 2021
Movement
$’000
721,310
(165,629)
$’000
(4,643)
4,643
30 June 2021
Restated
$’000
716,667
(160,986)
(v) Historical cost convention
These financial statements have been prepared on a historical cost basis except for the following:
• certain classes of property, plant and equipment measured at fair value,
• assets held for sale are measured at the lower of carrying amount and fair value less costs to sell, and
• certain financial assets and liabilities (including derivative instruments) measured at fair value through profit or loss.
(vi) Climate change
In the preparation of the 30 June 2022 financial statements, an overarching consideration was the impact of the climate
change and its risks. The Group continues to develop its assessment of the potential impact of climate change and
the transition to a low carbon economy. The Group’s current climate change strategy focuses on reducing operational
greenhouse gas (GHG) emissions, investing in low emissions technologies, supporting emissions reductions in our supply
chain, managing climate-related risk and opportunity, and working in partnership to reduce emissions. Future changes to
the Group’s climate change strategy or global decarbonisation goals may impact the Group’s significant judgements and key
estimates and result in a material change to financial results and the carrying values of certain assets and liabilities in future
reporting periods. Currently the Group has not finalised and announced any targets with regards to climate change and
climate risk and therefore have not adjusted any of the assets or liabilities of the Group in the 30 June 2022 Balance Sheet.
(b)
Principles of consolidation
(i) Subsidiaries
Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity
where the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to
affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date
on which control is transferred to the Group. They are deconsolidated from the date that control ceases.
The acquisition method of accounting is used to account for all business combinations by the Group (refer to note 25(f)).
Intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by
the Group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of profit
or loss, consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated
statement of financial position respectively.
(ii) Joint arrangements
Under AASB 11 Joint Arrangements, investments in joint arrangements are classified as either joint operations or joint
ventures. The classification depends on the contractual rights and obligations of each investor, rather than the legal structure
of the joint arrangement. Perenti Global Limited has only joint ventures.
Joint ventures
Interests in joint ventures are accounted for using the equity method, after initially being recognised at cost in the
consolidated statement of financial position.
147
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 25 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(b)
Principles of consolidation (continued)
(iii) Changes in ownership interests
The Group treats transactions with non-controlling interests that do not result in a loss of control as transactions with
equity owners of the Group. A change in ownership interest results in an adjustment between the carrying amounts of
the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the
amount of the adjustment to non-controlling interests and any consideration paid or received is recognised in a separate
reserve within equity attributable to owners of Perenti Global Limited.
When the Group ceases to have control, joint control or significant influence, any retained interest in the entity is remeasured
to its fair value with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount
for the purposes of subsequently accounting for the retained interest as a joint venture or financial asset. In addition,
any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the
Group has directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in other
comprehensive income are reclassified to profit or loss.
If the ownership interest in a joint venture is reduced, but joint control or significant influence is retained, only a proportionate
share of the amounts previously recognised in other comprehensive income are reclassified to profit or loss where
appropriate.
(c)
Foreign currency translation
(i) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary
economic environment in which the entity operates (‘the functional currency’). The consolidated financial statements are
presented in Australian dollar ($), which is Perenti Global Limited’s functional and presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation
of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in
profit or loss. They are deferred in equity if they are attributable to part of the net investment in a foreign operation.
Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date
when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of
the fair value gain or loss. For example, translation differences on non-monetary assets and liabilities such as equities held at
fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss and translation differences
on non-monetary assets such as equities classified as at fair value through other comprehensive income are recognised in
other comprehensive income.
(iii) Group companies
The results and financial position of foreign operations (none of which has the currency of a hyperinflationary economy) that
have a functional currency different from the presentation currency are translated into the presentation currency as follows:
• assets and liabilities for each statement of financial position presented are translated at the closing rate at end of the
reporting period
•
income and expenses for each income statement and statement of comprehensive income are translated at average
exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the
transaction dates, in which case income and expenses are translated at the dates of the transactions), and
• all resulting exchange differences are recognised in other comprehensive income.
On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and
of borrowings and other financial instruments designated as hedges of such investments, are recognised in other
comprehensive income. When a foreign operation is sold or any borrowings forming part of the net investment are repaid,
exchange differences are reclassified to profit or loss, as part of the gain or loss on sale.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the
foreign entity and translated at the closing rate.
(d)
Interest income
Interest income from financial assets at fair value through profit and loss is included in the net fair value gains/(losses)
on these assets. Interest income on financial assets at amortised cost and financial assets at fair value though other
comprehensive income calculated using the effective interest method is recognised in profit or loss as part of other income.
Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except
for financial assets that subsequently become credit-impaired. For credit-impaired financial assets the effective interest rate is
applied to the net carrying amount of the financial asset (after deduction of the loss allowance).
Interest income is presented as finance income where it is earned from financial assets that are held for cash management
purposes. Any other interest income is included in other income.
148
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 25 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(e)
(f)
Income tax
The income tax expense or benefit for the period is the tax payable on the current period’s taxable income based on
the national income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to
temporary differences between the tax base of assets and liabilities and their carrying amount in the financial statements,
and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of
the reporting period in the countries where the Company and its subsidiaries and associates operate and generate taxable
income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax
regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be
paid to the tax authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred income tax is not
accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that
at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using
tax rates (and laws) that have been enacted or substantially enacted by the end of the statement of financial position date and
are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.
Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise those temporary
differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases
of investments in foreign operations where the Company is able to control the timing of the reversal of the temporary
differences and it is probable that the differences will not reverse in the foreseeable future.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly
in equity, respectively.
(i) Investment allowances and similar tax incentives
Companies within the Group may be entitled to claim special tax deductions for investments in qualifying assets or in
relation to qualifying expenditure (e.g. the Research and Development Tax Incentive regime in Australia or other investment
allowances). The Group accounts for such allowances as tax credits, which means that the allowance reduces income tax
payable and current tax expense. A deferred tax asset is recognised for unclaimed tax credits that are carried forward as
deferred tax assets.
Business combinations
The acquisition method of accounting is used to account for all business combinations, regardless of whether equity
instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the:
•
•
• equity interests issued by the Group
•
•
fair value of any asset or liability resulting from a contingent consideration arrangement, and
fair value of any pre-existing equity interest in the subsidiary.
fair values of the assets transferred
liabilities incurred to the former owners of the acquired business
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited
exceptions, measured initially at their fair values at the acquisition date. The Group recognises any non-controlling interest in
the acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest’s proportionate
share of the acquired entity’s net identifiable assets. Acquisition-related costs are expensed as incurred.
Goodwill is recorded when there is an excess of the:
• consideration transferred
• amount of any non-controlling interest in the acquired entity, and
• acquisition date fair value of any previous equity interest in the acquired entity
If those amounts are less than the fair value of the net identifiable assets of the subsidiary acquired, the difference is
recognised directly in profit or loss as a bargain purchase. Where settlement of any part of cash consideration is deferred,
the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is
the entity’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent
financier under comparable terms and conditions.
Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are
subsequently remeasured to fair value with changes in fair value recognised in profit or loss.
If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held
equity interest in the acquiree is remeasured to fair value at the acquisition date. Any gains or losses arising from such
remeasurements are recognised in profit or loss.
Under the acquisition method, the Group has up to 12 months post the acquisition date to finalise the fair values of
identifiable assets and liabilities.
149
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS 25 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(g) Cash and cash equivalents
For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits
held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or
less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value,
and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the statement of financial position.
(h) Non-current assets (or disposal groups) held for sale and discontinued operations
Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered principally
through a sale transaction rather than through continuing use and a sale is considered highly probable. They are measured at
the lower of their carrying amount and fair value less costs to sell, except for assets such as deferred tax assets, assets arising
from employee benefits, financial assets and investment property that are carried at fair value and contractual rights under
insurance contracts, which are specifically exempt from this requirement.
An impairment loss is recognised for any initial or subsequent write-down of the asset (or disposal group) to fair value less
costs to sell. A gain is recognised for any subsequent increases in fair value less costs to sell of an asset (or disposal group),
but not in excess of any cumulative impairment loss previously recognised. A gain or loss not previously recognised by the
date of the sale of the non-current asset (or disposal group) is recognised at the date of derecognition.
Non-current assets (including those that are part of a disposal group) are not depreciated or amortised while they are
classified as held for sale. Interest and other expenses attributable to the liabilities of a disposal group classified as held for
sale continue to be recognised.
Non-current assets classified as held for sale and the assets of a disposal group classified as held for sale are presented
separately from the other assets in the balance sheet. The liabilities of a disposal group classified as held for sale are
presented separately from other liabilities in the balance sheet.
A discontinued operation is a component of the entity that has been disposed of or is classified as held for sale and that
represents a separate major line of business or geographical area of operations, is part of a single co-ordinated plan to
dispose of such a line of business or area of operations, or is a subsidiary acquired exclusively with a view to resale.
The results of discontinued operations are presented separately in the consolidated statement of profit or loss.
(i)
Provisions
Provisions for legal claims are recognised when the Group has a present legal or constructive obligation as a result of past
events, it is probable that an outflow of resources will be required to settle the obligation and the amount has been reliably
estimated. Provisions are not recognised for future operating losses.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by
considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to
any one item included in the same class of obligations may be small.
Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present
obligation at the statement of financial position date. The discount rate used to determine the present value reflects current
market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the
passage of time is recognised as interest expense.
(j)
Employee benefits
(i) Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits and accumulating sick leave that are expected to be
settled wholly within 12 months after the end of the period in which the employees render the related service are recognised
in respect of employees’ services up to the end of the reporting period and are measured at the amounts expected to be paid
when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.
(ii) Other long-term employee benefit obligations
The liabilities for long service leave and annual leave are not expected to be settled wholly within 12 months after the end of
the period in which the employees render the related service. They are therefore measured as the present value of expected
future payments to be made in respect of services provided by employees up to the end of the reporting period using the
projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee
departures and period of service. Expected future payments are discounted using market yields at the end of the reporting
period of high quality corporate bonds with terms and currencies that match, as closely as possible, the estimated future cash
outflows. Remeasurements as a result of experience adjustments and changes in actuarial assumptions are recognised in
profit or loss.
The obligations are presented as current liabilities in the balance sheet if the entity does not have an unconditional right to
defer settlement for at least twelve months after the reporting date, regardless of when the actual settlement is expected to
occur.
150
FINANCIAL REPORTABN 95 009 211 474NOTES TO THE FINANCIAL STATEMENTS 25 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(j)
Employee benefits (continued)
(iii) Share-based payments
Equity settled share-based compensation benefits are provided to employees via Perenti Global Limited Incentive Rights Plan.
Information relating to the Plan is set out in note 19. Equity settled share-based payments are measured at the fair value of
the equity instruments at grant date.
The fair value at grant date is independently determined using a Monte Carlo simulation or an amended Black Scholes Merton
methodology valuation model.
The fair value at the grant date of the equity settled share-based payments is expensed on a straight-line basis over the
vesting period, based on the Group’s estimate of equity instruments that will eventually vest, with a corresponding increase in
equity.
At the end of each reporting period, the Group revises its estimate of the number of equity instruments expected to vest
based on non-market vesting conditions. The impact of the revision of the original estimates, if any, is recognised in profit
or loss such that the cumulative expense reflects the revised estimates, with a corresponding adjustment to the share-based
payments reserve.
(k) Dividends
Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of
the entity, on or before the end of the reporting period but not distributed at the end of the reporting period.
(l)
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not
recoverable from the taxation authority. In this case, it is recognised as part of the cost of acquisition of the asset or as part of
the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST
recoverable from, or payable to, the taxation authority is included within other receivables or payables in the statement of
financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities
which are recoverable from, or payable to the taxation authority, are presented as operating cash flows.
(m) Government grants
Government grants are recognised in the Consolidated Statement of Profit or Loss and Other Comprehensive Income when
there is reasonable assurance that the entity will comply with the conditions attaching to them, and the grant will be received.
Such grants are presented in Other Income.
(n) Rounding of amounts
The Company is of a kind referred to in ASIC Legislative Instrument 2016/191, issued by the Australian Securities and
Investments Commission, relating to the ‘rounding off’ of amounts in this report and the accompanying financial report.
Amounts in this report and the accompanying financial report have been rounded off to the nearest thousand dollars, or in
certain cases, to the nearest dollar.
151
PERENTI – ANNUAL REPORT 2022 NOTES TO THE FINANCIAL STATEMENTS DIRECTORS’ DECLARATION
In the directors’ opinion:
(a) the financial statements and notes set out on pages 90 to 151 are in accordance with the Corporations Act 2001, including:
(i) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting
requirements, and
(ii) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2022 and of its performance for
the financial year ended on that date, and
(b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and
payable, and
(c) at the date of this declaration, there are reasonable grounds to believe that the members of the extended closed Group
identified in note 23 will be able to meet any obligations or liabilities to which they are, or may become, subject by virtue of
the deed of cross guarantee described in note 23.
Note 25(a) confirms that the financial statements also comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board.
The directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer required by section
295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of the directors.
Mark Norwell
Managing Director & CEO
Perth
22 August 2022
152
FINANCIAL REPORTABN 95 009 211 474 INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS
153
PERENTI – ANNUAL REPORT 2022 154
FINANCIAL REPORTABN 95 009 211 474INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS 155
PERENTI – ANNUAL REPORT 2022 INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS 156
FINANCIAL REPORTABN 95 009 211 474INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS 157
PERENTI – ANNUAL REPORT 2022 INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS 158
FINANCIAL REPORTABN 95 009 211 474INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS 159
PERENTI – ANNUAL REPORT 2022 INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS 160
FINANCIAL REPORTABN 95 009 211 474INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS SHAREHOLDER INFORMATION
a.
Distribution of equity securities
Analysis of numbers of equity security holders by size of holding as at 17 August 2022:
Holding
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Number of
Holders
2,714
2,925
1,335
2,324
266
Ordinary shares
Shares
1,093,562
8,035,139
10,419,564
69,752,779
613,159,390
9,564
702,460,434
% of shares on
issue
0.16
1.14
1.48
9.93
87.29
100.00
There were 2,005 holders of less than a marketable parcel of 460,036 ordinary shares as at 17 August 2022.
b.
Equity security holders
The names of the twenty largest holders of quoted equity securities as at 17 August 2022 are listed below:
Name
1. HSBC Custody Nominees (Australia) Limited
2. Citicorp Nominees Pty Limited
3. J P Morgan Nominees Australia Pty Limited
4. HSBC Custody Nominees (Australia) Limited - A/C 2
5. Bremerton Pty Limited
6. Nebraska Pty Limited
7. National Nominees Limited
8. BNP Paribas Noms Pty Ltd
9. BNP Paribas Nominees Pty Ltd
10. Purple Dragon Holdings Pty Ltd
11. Mr BG Wright + Mrs WJ Wright
12. CTS Funds Pty Ltd
13. Royale Blue Pty Ltd
14. Mrs Patricia Gladys Wright
15. Gresham Partners Capital Limited
16. Morgan Stanley Australia Securities (Nominee) Pty Limited
17. Mrs PG Wright + Mr MG Wright + Mr JG Wright
18. CS Fourth Nominees Pty Limited
19. Netwealth Investments Limited
20. Citicorp Nominees Pty Limited
Ordinary shares
Number held
184,316,924
91,247,547
89,887,938
48,062,312
26,005,640
26,005,640
19,332,122
14,105,086
9,191,669
6,280,613
5,051,035
5,009,748
3,708,161
3,623,553
2,689,150
2,479,639
2,451,544
2,046,612
1,843,337
1,680,033
Percentage of
issued shares
(%)
26.24
12.99
12.80
6.84
3.70
3.70
2.75
2.01
1.31
0.89
0.72
0.71
0.53
0.52
0.38
0.35
0.35
0.29
0.26
0.24
Total held by the twenty largest shareholders
545,018,303
77.58
Unquoted equity securities
Number on
issue
Number of
holders
Rights issued under the Employee Incentive Rights Plan
23,678,642
83
161
PERENTI – ANNUAL REPORT 2022 SHAREHOLDER INFORMATION (CONTINUED)
c.
Substantial holders
Substantial holders in the Company are set out below as at 28 July 2022:
1. L1 Capital
2. Allan Gray Investment Mgt
3. Dimensional Fund Advisors
4. Fidelity Investments
d.
Voting rights
Ordinary Shares
Number held
Percentage (%)
54,878,088
50,733,869
39,950,540
37,872,174
7.8
7.2
5.7
5.4
The voting rights attaching to each class of equity securities are set out below:
(a) Ordinary shares: every member present at a meeting of the Company in person or by proxy shall have one vote and
upon a poll each share shall have one vote.
(b) Options: no voting rights.
(c) Rights: no voting rights.
162
FINANCIAL REPORTABN 95 009 211 474 GLOSSARY OF TERMS
A
B
C
D
E
F
G
H
I
J
AASB
ABAC
ABN
ACN
AMS
APES
ASIC
ASX
Australian Accounting Standards Board
Policy Anti-bribery and Anti-corruption Policy
Australian Business Number
Australian Company Number
African Mining Services
Accounting Professional & Ethical Standards
Australian Securities and Investments Corporation
Australian Stock Exchange
AUMS
African Underground Mining Service
BTP
Best Tractor Parts (Perenti subsidiary)
BPS (bps)
Basis Points
CGU
CFI
CO2-e
CoRE
DCF
DRP
EBIT(A)
EBITDA
ESG
FIFO
FVLCD
FVOCI
GST
GHG
HSE
HV
IASB
IDA
IFRS
IFRIC
Cash Generating Unit
Conduit Foreign Income
Carbon Dioxide Equivalent
Centre of Resources Excellence
Discounted cash flow
Dividend Reinvestment Plan
Earnings before interest, tax and amortisation
Earnings before interest, tax, depreciation and amortisation
Environment Social and Governance
Fly In Fly Out workforce
Fair value less cost of disposal
Fair value through other comprehensive income
Goods and Services Tax
Greenhouse Gas
Health Safety and Environment
Heavy Vehicle
International Accounting Standards Board
Indigenous Desert Alliance
International Financial Reporting Standards
International Financial Reporting Standards Interpretations Committee
JV
Joint venture
163
PERENTI – ANNUAL REPORT 2022 GLOSSARY OF TERMS
LTI
LEV
Long term incentive
Local Exhaust Ventilation
M&A
Mergers and acquisitions
NCI
NPAT
OCI
OEM
PGF
ROE
Non-controlling interest
Net Profit After Tax
Other comprehensive income
Original Equipment Manufacturer
Perenti Governance Framework
Return on Equity
ROACE
Return on average capital employed
SPI
SPIFR
SDG
TCFD
TFR
TRIFR
TSR
UMA
VAT
VIU
Serious potential incident STI Short term incentive
Serious Potential Incident Frequency Rate
Sustainable Development Goal
Task Force on Climate related Financial Disclosures
Total Fixed Remuneration
Total Recordable Injury Frequency Rate
Total shareholders’ return
Underground Mining Alliance – a joint venture between Perenti subsidiary
AUMS and Ghanaian mining contractor Rocksure
Value-added Tax
Value in Use
L
M
N
O
P
R
S
T
U
V
164
FINANCIAL REPORTABN 95 009 211 474 ANNUAL
REPORT
20
22
ABN 95 009 211 474
HEAD OFFICE
Level 2, 202 Pier Street, PERTH WA 6000 AUSTRALIA
+ 61 8 9421 6500
perentigroup.com