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CORPORATE DIRECTORY AND INFORMATION
Directors
Craig Baker, Chairman
Stephen Smith, Managing Director and CEO
Prince Gunasekara, Non-executive Director
Andrew Kemp, Non-executive Director
Russell Cole, Non-executive Director
Company Secretary
Daniel Zgrajewski
Registered Office and Principal
Administrative Office
22 Orient Avenue
PINKENBA QLD 4008
Mailing Address
PO Box 90
PINKENBA QLD 4008
Telephone: +61 7 3637 7000
Facsimile: +61 7 3260 1180
Share Registry
Link Market Services
Level 21, 10 Eagle Street
BRISBANE QLD 4000
Telephone: +61 1300 554 474
Bankers
Commonwealth Bank
Business and Private Banking
Level 21, 180 Ann Street
Brisbane QLD 4000
Solicitors
Talbot Sayer
Level 27, Riverside Centre
123 Eagle Street
Brisbane QLD 4000
Auditor
Hall Chadwick Qld
Level 4, 240 Queen Street
Brisbane QLD 4000
Stock Exchange Listing
The Company is listed on the
Australian Securities Exchange
ASX Code: PTB
Internet address
www.pacificturbine.com.au
ANNUAL REPORT
For the year ended 30 June 2018
Table of Contents
1
Corporate Directory and Information
Inside cover
Chairman and Managing Director’s Review
Directors’ Report
Auditor’s Independence Declaration
Corporate Governance Statement
Financial Statements and Notes
Directors’ Declaration
Independent Auditor’s Report
Shareholder Information
Company Statistics
2
6
19
20
30
84
85
91
Inside back cover
This financial report covers PTB Group Limited, a consolidated entity consisting of PTB Group Limited
and its controlled entities. The financial report is presented in the Australian currency.
PTB Group Limited is a public company limited by shares, incorporated and domiciled in Australia.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 2
CHAIRMAN AND MANAGING DIRECTOR’S REVIEW
For the year ended 30 June 2018
Dear Shareholders,
It is with great pleasure we present to you the annual report for the 2018 Financial Year.
Highlights
» Net profit before tax of $4.674m (+12%)
» Net assets of $47.315m (+6%)
» Net tangible assets per share of $0.64 (2017: $0.64)
» A fully franked dividend of 5c per share in June 2018 (2017: 5c per share)
» All businesses set for a profitable FY19
FY18 has been a very pleasing year for PTB Group. The businesses have performed well and met management
expectations. Pacific Turbine Brisbane was the standout performer with a significant increase in returns and the
re-signing of our largest contract until December 2023. International Air Parts also had a good year and continues
to deliver positive returns. While the financial results for Pacific Turbine USA and Pacific Turbine Leasing have
been lower than planned, the initiatives implemented this year will enable us to drive profit for FY19 and beyond.
Operational Results by Business
Pacific Turbine Brisbane
Pacific Turbine USA
Pacific Turbine Leasing
International Air Parts
Corporate Overheads
2018
$’000
2017
$’000
2016
$’000
$4,142
$2,492
$2,575
($74)
$565
$527
$712
$1,393
$1,782
$83
$1,223
$1,597
($1,598)
($1,398)
($1,285)
Profit/(Loss) excluding FX and Write-downs
$4,428
$4,115
$4,193
Foreign Exchange (FX)
Write-downs
$246
–
$42
–
($525)
–
Profit/(Loss) before Income Tax Expense
$4,674
$4,157
$3,668
Pacific Turbine Brisbane
Pacific Turbine Brisbane had a particularly good year with a net profit before tax (excluding FX) of
$4.142 million (2017: $2.492 million). The consistent returns for this business are driven by long-term
engine maintenance contracts, continued efficiency gains and success in trading of aircraft engines and
parts. The improved result for FY18 was driven by: improved parts sales, high margins on workshop jobs,
as well as reduced parts and freight costs. There was also a minor realignment of overhead costs within the
Group that added to the result.
Pacific Turbine USA
Pacific Turbine USA was solid from an operational perspective: setting up the facility in Miami, consolidating the
Group’s US inventory holdings and providing savings in purchasing, repairs and freight costs for all Group
businesses. The financial result, a net loss before tax of $0.074 million (2017: $0.527 million profit), does not
reflect the excellent work done by the small team in Miami. The business had returned an operational profit
before tax and FX of $0.140 million for the second half of the year before a provision for impairment of a debtor
from a prior year sale reduced the result by $0.131 million.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
CHAIRMAN AND MANAGING DIRECTOR’S REVIEW
for the year ended 30 June 2018
3
The business added a fourth staff member late in the financial year to help boost sales capacity. The team
also signed their first maintenance contract late in the year, which is expected to provide consistent revenue and
margins moving forward.
Pacific Turbine Leasing
Pacific Turbine Leasing contributed a net profit before tax (excluding FX) of $0.565 million (2017: $0.712 million).
The business continues to receive consistent returns from the current fleet of aircraft and engines
on lease to long-term customers. The result was a little lower than the prior year due to the return of one aircraft
at the end of its lease. This aircraft has now been signed up to a new long-term lease and will add
to future revenues and margins.
A General Manager was appointed to the business at the start of July 2018 and his role is to grow the leasing
business significantly. The Japanese funding arrangements are seen as a key contributor to this. There are a
number of deals currently being negotiated and we expect to be able make announcements regarding these
in the near future.
International Air Parts (IAP)
The IAP business returned a net profit before tax (excluding FX) of $1.393 million (2017: $1.782 million).
The business had a good year returning another solid result. While the traditional product lines continue to
provide consistent income for the business, the most pleasing outcome was the increased contribution from
their new product line. This product line is expected to drive positive results for this business into the future.
Corporate Overheads
Corporate overheads costs were $1.598 million (2017: $1.398 million). This includes all head office and corporate
costs, including group management, the board and the central finance function. Costs were a little higher due to
a realignment of costs between Pacific Turbine Brisbane and Corporate Overheads.
Balance Sheet and Net Assets
The net asset position has increased from $44.753 million as at 30 June 2017 to $47.315 million at
30 June 2018. Debt remains at an appropriate level for the business.
Cash Flows
Operating: Cash flows from operating activities were $3.910 million (June 2017: ($3.210) million). This is
in line with the positive operating performance of the business for the year.
Financing: A placement of shares was undertaken late in the financial year to offset the cash impact of the
dividend and site works for the PT6A engine test cell that is due for completion in late 2018. The purchase
cost of the test cell is being funded by a new facility out of Japan.
PTB Group Growth Outlook
The Group businesses are well positioned and expected to provide consistent profit growth in FY19 and beyond.
The Group will continue to grow recurring income through incremental improvements while executing on the
growth opportunities in Leasing and in the Pacific Turbine USA business.
PTB Group management and staff have performed admirably throughout the year and continue to be the key to
the Group’s ongoing success.
The focus for PTB Group Limited over the next 12 months will be similar to prior years:
» Continue to build capacity and capabilities leading to increased revenues in Pacific Turbine USA
» Utilise existing relationships with our Japanese business partners to grow Pacific Turbine Leasing
» Continuing to grow (and renew) engine management programs for PTB, particularly by leveraging
off growth in Pacific Turbine Leasing
» Continuing to maintain and evolve sales including the new product line in IAP
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 4
CHAIRMAN AND MANAGING DIRECTOR’S REVIEW
for the year ended 30 June 2018
Overview of Group Businesses
Pacific Turbine Brisbane
Pacific Turbine Brisbane is an aircraft engine business concentrating on the PT6 and TPE331 engines.
The business sells engines, engine maintenance services and spare parts to a range of customers around
the world. The business operates out of a purpose-built facility at Pinkenba, near the Brisbane Airport.
Pacific Turbine Brisbane’s engine management programs (PTB-EMProgram) are the main driver of its success
and consistent returns. Under these programs, Pacific Turbine Brisbane provides a comprehensive engine
management service in return for consistent monthly payments. These plans provide Pacific Turbine Brisbane
with consistent cash flows and a continuous flow of engine sales, parts sales and workshop jobs.
With the established production plan that contract customers provide, the business can extract maximum value
from any opportunist bulk parts buys or engine opportunities that may arise.
The small PT6A engine is the cornerstone of the Pacific Turbine Brisbane engine business. The focus on the
PT6A engine has allowed Pacific Turbine Brisbane to build specialist knowledge and significantly reduce the
whole of life costs of operating and maintaining these engines. The addition of the PT6A test cell in the 2019
financial year is very exciting and will provide cost savings and a number of new opportunities for the business.
The TPE331 engine is also a contributor to Brisbane’s profitability but it is a mature engine with a slowly declining
operator base. Pacific Turbine Brisbane has a number of TPE331 engine management contracts, which assist the
business to maintain profitability in line with the declining operator base.
There continues to be organic growth opportunities for the PT6A Brisbane shop and the Group continues to
invest in plant, people and processes that improve efficiencies and profitability. Our engine overhaul shops are
primarily geared to produce engines for our contract customers.
Pacific Turbine USA
Pacific Turbine USA commenced trading in February 2016.
The business is based around a similar model to the Pacific Turbine Brisbane business but is focused on the
North American market. This business has strategic supply agreements with a number of businesses in the USA
that supply the engine repair and overhaul services required to support customers in North America.
The business established a home base in Miami, Florida in the fourth quarter of FY17. In line with this, a President
and support staff were also put in place. The President, DJ Davant has extensive experience in the aviation
industry and is a very good match for the growing business.
Pacific Turbine USA is responsible for coordinating the purchasing and repair of all PT6A parts for the Group.
The business is able to deliver savings across the Group by consolidating inventory, increasing purchasing power
and reducing freight costs.
The ongoing development of this business is a key strategy for the Group as it has the potential to provide a
significant boost to the Group’s overall results.
Pacific Turbine Leasing
Pacific Turbine Leasing is the Group business responsible for all rental and leasing activities for the Group.
This includes a fleet of freight and passenger aircraft and a large number of lease and rental engines.
Prior to FY17, these assets had been spread across the Group.
Growing the fleet of leased aircraft and engines is a key strategy for the group. The business is actively seeking
quality leasing opportunities to grow the fleet of leased assets and provide additional returns across the Group.
The Group has relationships with a group of Japanese investors that are keen to share in these mutually beneficial
opportunities. The appointment of a General Manager in July 2018 will help progress this.
Pacific Turbine Leasing fits in with other core business as it allows for cross selling of parts and maintenance of
engines under engine management plans. Contracts in Pacific Turbine Leasing are typically long term in nature,
with high retention rates, offering consistent earnings.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 CHAIRMAN AND MANAGING DIRECTOR’S REVIEW
for the year ended 30 June 2018
5
International Air Parts (IAP)
IAP is predominantly an aircraft spare parts business. The business operates out of a large warehouse in
Warriewood, New South Wales.
The business sells a large variety of airframe parts, aircraft engines and engine repair and overhaul services from
its own vast stockholding and a comprehensive supplier network.
The IAP business is split into two main divisions: Engines and Airframe Parts.
The Engines division manages repairs and overhauls of engines on behalf of its customers. It also manages the
tear down of engines and sells a range of engine parts. The division is currently focused on Rolls Royce engines.
The knowledge in the engine division enables team members to work across a number of turbine engine types
and extract maximum returns from all opportunities.
The Airframe division has focused on Fokker, SAAB and British Aerospace airframes. It also has a major role in
supporting the customers of Pacific Turbine Leasing. The airframe segment will continue to extract returns from
the sell down of the existing stock, while maintaining an appropriate level of stock to support lease customers.
Craig Baker
Chairman
Stephen Smith
Managing Director
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 6
DIRECTORS’ REPORT
For the year ended 30 June 2018
Your Directors present the financial report of PTB Group Limited and its controlled entities (“the Group”)
for the year ended 30 June 2018.
Directors
The following persons were Directors in office at any time during or since the end of the year:
Name
CL Baker
SG Smith
APS Kemp
RQ Cole
RS Ferris
Position
Director (non-executive), Chairman
Managing Director
Director (non-executive)
Director (non-executive)
Director (non-executive), resigned 7th October 2017
PP Gunasekara
Director (non-executive), appointed 1st September 2017
Principal Activities
The principal activities of the Group during the financial year were the provision of the following services in
relation to aviation assets:
» A specialist Pratt & Whitney PT6A and Honeywell TPE331 turbine engine repair and overhaul business based
at Brisbane, Australia;
» Trading operations in Australia and internationally in aircraft airframes, turbine engines, and related parts;
» The provision of finance for aircraft and turbine engines sold to customers; and
» The lease, rental, or hire of aircraft and turbine engines to customers.
There have been no significant changes in the nature of these activities during the year not otherwise disclosed
in this report.
Operating Results
The consolidated net profit after tax was $3.243 million (2017: $2.948 million profit).
Financial Position
The net assets of the Group are $47.315 million as at 30 June 2018 (2017: $44.753 million).
Dividends
A fully franked dividend of 5 cents per share was declared and paid for the 30 June 2018 financial year
(2017: 5 cents per share).
Franking Credits
Franking credits available for subsequent financial years based on a tax rate of 30 per cent are $6.859 million
(2017: $8.204 million).
Significant Changes in State of Affairs
There were no significant changes in the state of affairs of the Group not otherwise disclosed in this report.
After Balance Date Events
No matters or circumstances have arisen since the end of the financial year which have 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 future.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 DIRECTORS’ REPORT
For the year ended 30 June 2018
7
Future Developments, Prospects and Business Strategies
With all core businesses performing well, the Group is focused on growth opportunities.
The primary growth strategy is the development of the engine business in America through Pacific Turbine USA.
The business sells PT6 engines, parts and management programs similar to the PTB business.
Strategic relationships with established engine shops in the USA allow the new business to expand operations
quickly with no fixed capital requirements and greatly reduced risk.
The second key growth path for the business is aircraft leasing. The Group will grow the fleet of leased assets
and provide additional returns across the Group. The Group has relationships with a group of Japanese investors
that are keen to share in these mutually beneficial opportunities.
Other than as detailed in the Chairman and Managing Director’s Review, the Directors have excluded from
this report any further information on the likely developments in the operations of the Group and the expected
results of those operations in future financial years, as the Directors have reasonable grounds to believe that
it would be likely to result in unreasonable prejudice to the Group.
Environmental Issues
The Group operates from Brisbane and Sydney (including Bankstown Airport) in Australia. It is required
to meet the Commonwealth’s Airports (Environment Protection) Regulations 1997. The Group also has
administration and warehouse facilities in a number of locations subject to relevant legislation. There have been
no non-compliances to date while the Group has operated from these various locations.
Information on Current Directors
Craig Baker CA, BCA (Non-Executive Director, Chairman)
Craig Baker was born in 1946 in New Zealand. He has had extensive experience in the aviation industry and is a
qualified accountant having been involved in aviation businesses as a General Manager, Director and Finance
Manager for over 35 years.
Craig was appointed as the Chairman of the Remuneration Committee and a member of the Audit and Risk
Management Committee effective from 1 July 2017. He has held no Director positions with other listed companies
in the last three years.
Stephen Smith (Managing Director)
Stephen was a founding shareholder and Director of PTB Group Limited and has fulfilled a number of key roles
within the Group including Commercial Sales Manager and Director of Sales and Marketing. Through these
roles, Stephen has been a key contributor to the strategic direction and growth of the Group. Prior to his
involvement with the Group, Stephen had significant experience in the aviation industry as both a helicopter and
fixed wing operator.
Stephen has held no Director positions with other listed companies in the last three years.
Andrew Kemp B.Com, CA (Non-Executive Director)
Andrew graduated in Commerce from the University of Melbourne and is a Chartered Accountant. After working
for KPMG and Littlewoods Chartered Accountants in Melbourne and Sydney, he joined AIFC, the merchant
banking affiliate of the ANZ Banking Group, in Sydney in 1978. From 1979 until 1985, Andrew
was Queensland Manager of AIFC.
Andrew joined the North Queensland based Coutts Group as General Manager early in 1985 and continued with
this group until January 1987 when he formed Huntington Group. Since 1980, Andrew has been involved in a
range of listings, acquisitions and divestments. He has structured and implemented the ASX listing of eleven
companies. He has also advised clients on a wide range of investments and divestments over the last 25 years.
Andrew is currently a Director of Silver Chef Limited (from April 2005). He was a director of G8 Education Limited
(March 2011 to March 2015) and Trojan Equity Limited (May 2005 to March 2013).
Andrew is a member of the Audit and Risk Management and Remuneration Committees of the Company.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 8
DIRECTORS’ REPORT
For the year ended 30 June 2018
Russell Cole B.Com, FCA (Non-Executive Director)
Russell graduated from the University of Queensland with a Bachelor of Commerce and is a Chartered Accountant
and Registered Company Auditor. He has over 25 years’ experience in public practice as a Chartered Accountant
specialising in the corporate sector with significant experience in audit, risk management and corporate
governance. He has spent 15 years as an audit & assurance partner of national accounting firms with a particular
focus on emerging listed companies.
Russell is the Chairman of the Audit and Risk Management Committee and was appointed as a member of the
Remuneration Committee effective from 1 July 2017. He has held no Director positions with other listed companies
in the last three years.
Prince Gunasekara (Non-Executive Director)
Prince was appointed as a director of PTB Group Limited on 1 September 2017.
Prince is a Sri Lankan born aviation expert with over 20 years’ experience, particularly within Japanese aviation.
Prince has worked across many areas of the industry, including but not limited to procurement of aircraft parts
and aircraft engines for Japanese aircraft operators.
Since joining PTB Group in 2013 as an Engine Sales Manager, Prince has been instrumental in introducing key
Japanese investors and business partners.
Company Secretary
Daniel Zgrajewski was appointed as the Chief Financial Officer and Company Secretary effective from
27 November 2013. Daniel holds a Bachelor of Business from Queensland University of Technology and is a
Certified Practicing Accountant.
Daniel has over 20 years of experience in finance and has worked in a number of roles in commercialised
segments of Brisbane City Council. These roles included Commercial Accountant for Brisbane CityWorks and
Principal Financial Accountant for Brisbane Water.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 DIRECTORS’ REPORT
For the year ended 30 June 2018
9
Remuneration Report (Audited)
The remuneration report is set out under the following main headings:
A
B
C
D
E
F
Key management personnel
Principles used to determine the nature and amount of remuneration
Details of remuneration
Service contracts
Share-based payment compensation
Additional information
The information provided in this remuneration report has been audited as required by section 308(3C)
of the Corporations Act 2001.
A. Key management personnel
The directors and other key management personnel of the consolidated entity during or since the end
of the financial year were:
Non-executive directors
Mr CL Baker (Chairman, Non-Executive Director)
Mr APS Kemp (Non-Executive Director)
Mr RQ Cole (Non-Executive Director)
Mr RS Ferris (Non-Executive Director), resigned 7th October 2017
Mr PP Gunasekara (Non-Executive Director), appointed 1st September 2017
Executive officers
Mr SG Smith (Managing Director)
Mr D Zgrajewski (Company Secretary and CFO)
Except as noted, the named persons held their current position for the whole of the financial year
and since the end of the financial year.
B. Principles used to determine the nature and amount of remuneration
Non-executive Directors
Non-executive Directors are to be paid out of Group funds as remuneration for their services, such sum as
accrues on a daily basis as the Group determines to be divided among them as agreed, or failing agreement,
equally. The maximum aggregate amount which has been approved by shareholders for payment to non-
executive Directors is $200,000 per annum.
Directors’ remuneration for their services as Directors is by a fixed sum and not a commission or a percentage
of profits or operating revenue. It may not be increased except at a general meeting in which particulars of the
proposed increase have been provided in the notice convening the meeting of shareholders. There is provision
for Directors who devote special attention to the business of the Group or who perform services which are
regarded as being outside the scope of their ordinary duties as Directors, or who at the request of the Board
engage in any journey on Group business, to be paid extra remuneration determined by the Board.
Directors are also entitled to their reasonable travel, accommodation and other expenses incurred in attending
Group or Board meetings, or meetings of any committee engaged in the Group’s business. Any Director may be
paid a retirement benefit as determined by the Board, consistent with the Corporations Act 2001 and the ASX
Listing Rules.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 10
DIRECTORS’ REPORT
For the year ended 30 June 2018
Executive and Key Management Pay
The remuneration committee is responsible for advising the Board on remuneration and issues relevant
to remuneration policies and practices including those of senior management and executive Directors.
The committee has responsibility for reviewing and evaluating market practices and trends in relation
to remuneration, recommending remuneration policies, overseeing the performance and making recommendations
on remuneration of members of senior management and executive Directors.
Remuneration in each case is taken as including not only monetary payments (salaries), but all other
non-monetary emoluments and benefits, retirement benefits, superannuation and incentive programs.
In each case the committee refers to the general market and industry practice (as far as directly relevant
benchmarks can be identified for comparative purposes) and the need to attract and retain high caliber personnel.
Compensation in the form of cash bonuses for executives and key management personnel is designed to ensure
reward for performance is competitive and appropriate for the results delivered. The framework aligns executive
and key management reward with achievement of strategic objectives and creation of value for shareholders in
terms of return on equity and conforms to market practice for delivery of reward. The Board ensures that
executive and key management reward satisfies the following key criteria for good reward governance practices:
» Competitiveness and reasonableness;
» Acceptability to shareholders;
» Performance alignment of compensation;
» Transparency; and
» Capital management.
Executive Directors
The Executive Directors’ pay and reward framework has the following components:
» Base pay and benefits, including superannuation; and
» Short-term performance incentives.
Base pay: Structured as a total employment cost package which may be delivered as a combination of
cash and prescribed non-financial benefits at the Executive Director’s discretion. Base pay is reviewed
annually and benchmarked against inflation.
Superannuation: Executive Directors’ base pay includes statutory and salary sacrificed superannuation
contributions.
Short-term performance incentives: Cash bonus incentives are based on pre-determined after tax return
on equity and operational targets based on the criteria detailed above, as set by the remuneration committee.
The bonuses are paid in October each year. The pre-determined targets ensure that variable reward is only
available when value has been created for shareholders, and when profit and operational objectives are consistent
with the business plan. Each Executive Director has a target short-term incentive opportunity depending on the
accountabilities of the role and impact on the organisation or business unit performance. The maximum target
bonus opportunity is 33 per cent of base pay.
As advised in the following “Section C. Details of Remuneration”, no short-term incentives were paid to Executive
Directors during the financial year (2017: Nil).
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 DIRECTORS’ REPORT
For the year ended 30 June 2018
11
Other Executives and Key Management Personnel
Other Executives and key management personnel’s pay and reward framework includes base pay and
short-term incentives. There are no fixed performance criteria for the cash bonuses. After the end of the financial
year the remuneration committee assesses the performance of individuals and, where appropriate, approves
discretionary cash bonuses to be paid to the individuals. Cash bonuses are paid following approval
by the remuneration committee.
Long-term incentives to Executives and Employees
In order to provide a long-term incentive to the executives and employees of the Group, an Employee Share
Option Scheme (“the Scheme”) is in place. The incentive provided by the scheme will be of material benefit
to the Group in encouraging the commitment and continuity of service of the recipients. By providing executives
and employees with a personal financial interest in the Group, the Group will be able to attract and retain
Executive Directors, key Executives and employees in a highly competitive market. This is expected to result in
future benefits accruing to the shareholders of the Group.
The establishment of the Scheme was approved by shareholders on 3 June 2005. All staff are eligible to participate
in the scheme, including Executive Directors (since they take part in the management of the Group).
As advised in the following “Section E Share-Based Payment Compensation” no options were issued under
the scheme during the year (2017: Nil).
Company Performance, Shareholder Wealth and Directors’ and Executive Remuneration
The base salaries for the executives are substantially in accordance with the market for executives of
similar levels.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 12
DIRECTORS’ REPORT
For the year ended 30 June 2018
C. Details of Remuneration
The remuneration for each Director and other key management personnel of the Group was as follows:
Short-term benefits
Post-
employ-
ment
Other
Total
Share-
based
payment
Cash
salary
and fees
$
Non-
monetary
benefits
$
Cash
bonus
$
Super
-annu
-ation
$
Long
-term
benefits*
$
Termin
-ation
Benefits
$
Options
$
$
2018 Year
Directors
CL Baker
(Chairman,
Non-Executive
Director)
21,139
SG Smith
(Managing Director)
439,980
21,800
8,420
30,000
168,333
APS Kemp
(Non-Executive
Director)
RS Ferris
(Non-Executive
Director – resigned
7th October 2017)
RQ Cole
(Non-Executive
Director)
PP Gunasekara
(Non-Executive
Director – appointed
1st September 2017)
Total Directors
689,672
–
–
–
–
–
–
–
–
22,661
–
–
–
–
–
–
–
–
–
950
–
23,611
Other Key
Management
Personnel
D Zgrajewski
(Company Secretary
and CFO)
Total Other
Key Management
Personnel
202,120
5,000
202,120
5,000
–
–
19,734
19,734
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
43,800
– 439,980
–
21,800
–
8,420
–
30,000
–
169,283
–
713,283
–
226,854
– 226,854
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
DIRECTORS’ REPORT
For the year ended 30 June 2018
13
Short-term benefits
Post-
employ-
ment
Other
Total
Share-
based
payment
Cash
salary
and fees
$
Non-
monetary
benefits
$
Cash
bonus
$
Super
-annu
-ation
$
Long
-term
benefits*
$
Termin
-ation
Benefits
$
Options
$
$
2017 Year
Directors
H Parker
(Non-Executive
Director)
CL Baker
(Managing Director
– Group until
30 April 2017)
SG Smith
(Executive Director.
Managing Director
from 1 May 2017)
APS Kemp
(Non-Executive
Director)
RS Ferris
(Non-Executive
Director)
A Sormann
(Non-Executive
Director – 01/07/16
to 13/10/16)
RQ Cole
(Non-Executive
Director)
376,142
21,800
65,475
6,226
10,000
33,000
–
–
–
–
274,359
–
–
28,181
2,264
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
28,181
2,264
Total Directors
787,002
Other Key
Management
Personnel
D Zgrajewski
(Company Secretary
and CFO)
Total Other Key
Management
Personnel
188,929
3,000
–
25,233
188,929
3,000
–
25,233
–
–
* comprising accrued long service leave.
There were no other executives in the current or prior year.
–
–
–
–
–
–
–
–
–
–
–
33,000
– 304,804
–
376,142
–
–
–
21,800
65,475
6,226
–
10,000
– 817,447
–
217,162
–
217,162
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
14
DIRECTORS’ REPORT
For the year ended 30 June 2018
D. Service Contracts
Major provisions of service agreements with Executive Directors and other key management personnel
as at 30 June 2018 are set out below:
S G Smith (Managing Director)
» Commencement date of consultancy agreement – 1 May 2017;
» Service fee – $440,000 p.a.; and
» Notice period – Termination by three months’ notice in writing by either party other than for gross misconduct.
P P Gunasekara (Director)
» Commencement date of consultancy agreement – 1 August 2017;
» Service fee – $190,000 p.a. ($20,000 of this relates to non-executive Director fees and the remainder
is for other activities); and
» Notice period – Termination by three months’ notice in writing by either party other than for gross misconduct.
D Zgrajewski (Company Secretary and Chief Financial Officer)
» Term of agreement – Three years commencing 22 November 2016;
» Base annual salary – $210,225 excluding superannuation; and
» Notice period – Termination by three months’ notice in writing by either party other than for gross misconduct.
No other key management personnel are subject to service agreements.
E. Share-based Payment Compensation
No remuneration options were granted to key management personnel, exercised or lapsed during this or the
prior financial year.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 DIRECTORS’ REPORT
For the year ended 30 June 2018
F. Additional Information
The number of shares in the Group held during the financial year by each Director of PTB Group Limited
and other key management personnel of the Group, including their personally related parties, are set out below.
There were no shares granted during the current or previous year as compensation.
15
Balance at
the start of
the year
Issued as
purchase
consider-
ation
Received
during the
year on the
exercise of
options
Other
changes
(on-market
purchases
& DRP)
Balance
at date of
appoint-
ment/
resignation
Balance at
the end of
the year
Number
Number
Number
Number
Number
Number
Name
2018
Directors
CL Baker
RS Ferris
SG Smith
3,585,639
5,134,499
5,560,038
–
–
–
–
–
–
APS Kemp
1,216,658
RQ Cole
PP Gunasekara
63,843
–
Other key management personnel of the Group
D Zgrajewski
63,370
2017
Directors
H Parker
CL Baker
RS Ferris
SG Smith
APS Kemp
466,001
3,227,074
9,221,049
2,392,834
943,257
A Sormann
9,502,664
RQ Cole
–
–
–
–
–
–
–
–
–
Other key management personnel of the Group
D Zgrajewski
57,033
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(1,311,346)
–
2,274,293
(2,500,000)
2,634,499
N/A
432,597
112,656
5,912
–
–
–
5,992,635
1,329,314
69,755
207,058
2,236,224
2,443,282
5,868
51,779
358,565
(4,086,550)
3,167,204
273,401
–
–
–
–
–
–
69,238
517,780
3,585,639
5,134,499
5,560,038
1,216,658
–
9,502,664
N/A
63,843
6,337
–
–
63,843
63,370
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 16
DIRECTORS’ REPORT
For the year ended 30 June 2018
Loans to key management personnel
On 21 June 2017, the Group provided a limited recourse loan of $1.65 million to SG Smith at an interest rate
of 5% per annum to pay for the subscription price of 3 million fully paid ordinary shares. These shares were
issued to him in accordance with the shareholder approval on 9 June 2017 and the terms of his engagement
as the Group’s Managing Director. The maximum term of this loan is 5 years and interest will be capitalised
throughout the term of the loan. The interest capitalised during the year was $84,521. A voluntary escrow applies
to these shares until money owing under the loan is repaid. Any cash dividends paid in relation to
these shares are paid against any remaining loan balance. There were no other loans to Directors of PTB Group
Limited or other key management personnel of the Group during the previous reporting period.
Other transactions with key management personnel (KMP) and/or their related parties
All transactions were under normal commercial terms and conditions, unless otherwise stated. No bad or
doubtful debt expenses have been, or are likely to occur, from transactions with related parties.
A previous Director, Mr. RS Ferris (resigned 7th October 2017) beneficially owns 100% of the shares and is
a director of: IAP Engineering Pty Ltd (Engineering), Pionair Australia Pty Ltd (Pionair) and SF Aviation Pty Ltd
(SF Aviation). He is also a shareholder of Horizon Airlines Engineering Pty Ltd (Horizon).
From 1/7/2017 to 6/10/2017, IAP and PTB processed sales to Engineering, Horizon, Pionair and SF Aviation
on normal commercial terms.
From 1/7/2017 to 6/10/2017, IAP processed purchases from Engineering and Horizon on normal commercial terms.
Aggregate amounts of each of the above types of other transactions with key management personnel of
the Group are as follows:
Amounts invoiced by IAP and PTB to:
Engineering – Rental for hangar, airport parking fees and other costs (IAP)
17,832
82,692
Horizon – Sale of aircraft and engine parts (IAP and PTB)
12,540
114,398
2018
$
2017
$
Pionair – Sale of aircraft parts (IAP)
SF Aviation – workshop services (PTB)
Amounts invoiced to IAP and PTB by:
Engineering – Consultancy services rendered by Mr. Ferris
Horizon – Purchase of parts
–
–
–
–
SF Aviation – Consultancy services rendered by Mr. Ferris
17,460
Aggregate amounts receivable/payable arising from the above types of
transactions with key management personnel of the Group:
3,797
29,805
65,475
438
–
– current receivables
– current payables
–
–
36,489
–
– non-current receivables (Loan to SG Smith)
1,736,555
1,652,034
There were no other transactions conducted between the Group and KMP or their related parties, other
than those disclosed above relating to equity, compensation and loans, that were conducted other than in
accordance with normal employee, customer or supplier relationships on terms no more favourable than
those expected under arm’s length dealings with unrelated persons.
Details of remuneration: cash bonuses and options
Any grant of options and cash bonuses are discretionary. No options or bonuses were granted during the year.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
DIRECTORS’ REPORT
For the year ended 30 June 2018
17
Share-based compensation: options
There were no options granted during the year. As at 30 June 2018 there are no options on issue.
Share Options
Shares Issued on Exercise of Options
There were no options outstanding as at the commencement of the financial year and no options were issued
during the year ending 30 June 2018. No options were issued subsequent to year end.
Shares Under Option
At the date of this report, PTB Group Limited has no unissued ordinary shares under option.
Loans to Directors and Executives
On 21 June 2017, the Group provided a limited recourse loan of $1.65 million to SG Smith at an interest rate
of 5% per annum to pay for the subscription price of 3 million fully paid ordinary shares.
These shares were issued to him in accordance with the shareholder approval on 9 June 2017 and the terms
of his engagement as the Group’s Managing Director. The maximum term of this loan is 5 years and interest will
be capitalised throughout the term of the loan. The interest capitalised during the year was $84,521.
A voluntary escrow applies to these shares until money owing under the loan is repaid. Any cash dividends paid
in relation to these shares are paid against any remaining loan balance.
There were no other loans to Directors of PTB Group Limited or other key management personnel of
the Group during the previous reporting period.
Meetings of Directors
Attendances by each Director during the financial year were as follows:
Number of
Meetings Held
While a Director
Number of
Meetings
Attended
Full Board
CL Baker
SG Smith
APS Kemp
RS Ferris
RQ Cole
PP Gunasekara
Remuneration Committee
CL Baker
APS Kemp
RQ Cole
Audit and Risk Management Committee
RQ Cole
CL Baker
APS Kemp
12
12
12
3
12
10
2
2
2
4
4
4
12
12
12
1
11
8
2
2
2
4
4
3
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 18
DIRECTORS’ REPORT
For the year ended 30 June 2018
Indemnification and Insurance of Directors, Officers and Auditors
During or since the end of the financial year, the Group has not given any indemnity or entered into any
agreement to indemnify, or paid or agreed to pay insurance premiums in relation to an officer or auditor, except
as detailed below.
The Group has Directors and Officers insurance in place for all Directors and officers of the Group.
This insurance insures any person who is or has been an officer of the Group against certain liabilities in respect
of their duties as an officer of the Group, and any other payments arising from or in connection with such
proceedings, other than where such liabilities arise from conduct involving a willful breach of duty.
The policy prohibits disclosure of details of the cover and the amount of the premium paid.
Proceedings on Behalf of the Company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings
on behalf of the Company, or to intervene in any proceedings to which the Company is a party, for the purpose
of taking responsibility on behalf of the Company for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under
section 237 of the Corporations Act 2001.
Non-Audit Services
The Group may decide to employ the auditor on assignments additional to statutory audit duties where the
auditor’s expertise and experience with the Group are important.
The Board of Directors has considered the position and, in accordance with the advice received from the
audit committee is satisfied that the provision of non-audit services, if any, during the year is compatible with the
general standard of independence for auditors imposed by the Corporations Act 2001.
During the year no non-audit service fees were paid or payable for services provided by the auditor of the Group
(2017: Nil).
The lead auditor’s independence declaration is set out on page 19 and forms part of the Directors’ Report
for the year ended 30 June 2018.
Hall Chadwick Qld continues in office in accordance with Section 327 of the Corporations Act 2001.
Rounding of Amounts
The Company is of a kind referred to in 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 that
legislative instrument to the nearest thousand dollars, or in certain cases, the nearest dollar.
This report is made in accordance with a resolution of the Directors.
CL Baker
Chairman
Brisbane
29 August 2018
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 AUDITOR’S INDEPENDENCE DECLARATION
For the year ended 30 June 2018
19
Auditor’s Independence Declaration
for the year ended 30 June 2018
………………………………………………….………………………………………………………………………………………. 20
Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001 to the
directors of PTB Group Limited
I declare that, to the best of my knowledge and belief during the year ended 30 June 2018 there
have been no contraventions of:
(i)
the auditor independence requirements as set out in the Corporations Act 2001 in relation
to the audit; and
(ii) any applicable code of professional conduct in relation to the audit.
Geoffrey Stephens
Director
HALL CHADWICK QLD
Dated this 29th day of August 2018
Limited Liability by a scheme approved
under the Professional Standards Legislation
National Association | Hall Chadwick
International Association | Prime Global
Associations of Independent Firms
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 20
CORPORATE GOVERNANCE STATEMENT
For the year ended 30 June 2018
Corporate Governance describes the framework of
rules, relationships, systems and processes within
and by which authority is exercised and controlled
within corporations. It encompasses the mechanisms
by which companies, and those in control, are held to
account. Good corporate governance promotes
investor confidence which is crucial to the ability of
the group to compete for capital.
The ASX Corporate Governance Council’s Corporate
Governance Principles
and Recommendations
3rd Edition recommends eight core corporate
governance principles for entities listed on the
ASX that, in the Council’s view are likely to achieve
good governance outcomes and meet the reasonable
expectations of most investors in most situations. The
Recommendations are not mandatory and do not
seek to prescribe the corporate governance practices
that a listed entity must adopt.
is required to
Under Listing Rule 4.10.3 PTB
provide a statement disclosing the extent to which
it has followed the Recommendations. Where a
Recommendation has not been followed, this fact
must be disclosed together with the reasons for
the departure.
This PTB Group Corporate Governance Statement
is structured with reference to the Council’s Principles
and Recommendations.
Principle 1: Lay solid foundations for
management and oversight.
A listed entity should establish and disclose the
respective roles and responsibilities of its board and
management and how their performance is monitored
and evaluated.
Recommendation 1.1
Complies: YES
A listed entity should disclose:
(a) the respective roles and responsibilities of its
board and management; and
(b) those matters expressly reserved to the board and
those delegated to management.
Recommendation 1.2
Complies: YES
A listed entity should:
(a) undertake appropriate checks before appointing a
person, or putting forward to security holders a
candidate for election, as a director; and
(b) provide security holders with all material
information in its possession relevant to a decision
on whether or not to elect or re-elect a director.
Recommendation 1.3
Complies: YES
A listed entity should have a written agreement with
each director and senior executive setting out the
terms of their appointment.
Recommendation 1.4
Complies: YES
The company secretary of a listed entity should be
accountable directly to the board, through the chair,
on all matters to do with the proper functioning of
the board.
Recommendation 1.5
Complies: NO
A listed entity should:
(a) have a diversity policy which includes requirements
for the board or a relevant committee of the board
to set measurable objectives for achieving gender
diversity and to assess annually both the objectives
and the entity’s progress in achieving them;
(b) disclose that policy or a summary of it; and
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 CORPORATE GOVERNANCE STATEMENT
For the year ended 30 June 2018
21
(c) disclose as at the end of each reporting period the
measurable objectives
for achieving gender
diversity set by the board or a relevant committee
of the board in accordance with the entity’s
diversity policy and its progress towards achieving
them, and either:
(1) the respective proportions of men and women
on the board, in senior executive positions and
across the whole organisation (including how
the entity has defined “senior executive” for
these purposes); or
(2) if the entity is a “relevant employer” under the
Workplace Gender Equality Act, the entity’s
most recent “Gender Equality Indicators”, as
defined in and published under that Act.
Recommendation 1.6
Complies: YES
A listed entity should:
(a) have and disclose a process for periodically
evaluating the performance of the board, its
committees and individual directors; and
(b) disclose, in relation to each reporting period,
whether a performance evaluation was undertaken
in the reporting period in accordance with
that process.
The Board’s broad function is to:
a) Chart strategy and set financial targets for
the Group;
b) Monitor the implementation and execution of
strategy and performance against financial
targets; and
c) Appoint and oversee the performance of executive
management and generally to take and fulfil an
effective leadership role in relation to the Group.
Power and authority in certain areas is specifically
reserved to the Board – consistent with its function as
outlined above. These areas include:
(a) Composition of the Board itself including the
appointment and removal of Directors;
(b) Oversight of the Group including its strategy,
and
performance,
controls
operational
accountability systems;
(c) Appointment and removal of senior executives
and the Company Secretary;
(d) Reviewing, ratifying, and monitoring systems of
risk management and internal compliance and
control, codes of ethics and conduct, and legal
and statutory compliance;
(e) Monitoring senior management’s performance
Recommendation 1.7
Complies: YES
and implementation of strategy;
A listed entity should:
(a) have and disclose a process for periodically
evaluating the performance of its senior executives;
and
(b) disclose, in relation to each reporting period,
whether a performance evaluation was undertaken
in the reporting period in accordance with
that process.
Responsibility of the Board
for
the Company’s
Responsibility
corporate
governance rests with the Board. The Board’s guiding
principle in meeting this responsibility is to act
honestly, conscientiously and fairly, in accordance
with the law, in the interests of PTB Group’s
shareholders (with a view to building sustainable
value for them) and those of employees and
other stakeholders.
(f ) Approving and monitoring the progress of major
capital expenditure, capital management, and
acquisitions and divestures; and
(g) Approving and monitoring financial and other
reporting and the operation of committees.
Responsibilities of the Managing Director
and Senior Management
The Managing Director and other senior executives
are responsible for:
a) Developing corporate strategy, performance
targets, budgets, and business and operational
plans for review and ratification by the Board;
b) Developing,
implementing, and maintaining
appropriate policies, procedures, and practices for
the management and control of the business; and
c) Execution of the overall corporate strategy and
business plans, and the day to day management
of operations.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 22
CORPORATE GOVERNANCE STATEMENT
For the year ended 30 June 2018
Board Charter and Policy
The Board has adopted a charter which will be kept
under review and amended from time to time as the
Board may consider appropriate to give formal
recognition to the matters outlined above. The last
amendment was in June 2015. This charter sets out
various other matters that are important for effective
corporate governance including the following:
a) A detailed definition of ‘independence’;
b) A framework for the identification of candidates
for appointment to the Board and their selection;
c) A framework for individual performance review
and evaluation;
d) Proper
training
to
Directors both at the time of their appointment
and on an on-going basis;
to be made available
e) Basic procedures for meetings of the Board
and its committees: frequency, agenda, minutes
and private discussion of management issues
among non-executive Directors;
f) Ethical standards and values: formalised in a
detailed code of ethics and values;
g) Dealings in securities: as per the Group’s Securities
Trading Policy last updated on 22 December 2010
that is lodged with the ASX; and
h) Communications
with
shareholders
and
the market.
Appointment of Board Members
information
material
in the Group’s possession
relevant to a decision on whether or not to elect or
re-elect a director.
The terms and conditions of the appointment of all
new members of the Board must be specified in a
letter of appointment.
Service Agreements with Senior Management
and Company Secretary
The terms of appointment of senior management are
documented in a service agreement. Key details of
service agreements with key management personnel
are detailed in the remuneration report forming part
of the Directors’ Report in the annual report.
The terms of appointment of the company secretary
are documented in a service agreement including that
the company secretary
is accountable directly
to the board, through the chair, on all matters to
do with the proper functioning of the board.
Diversity Policy
The Board aims to create a corporate culture that
embraces diversity by applying transparent merit
based principles
training and
promotion opportunities.
recruitment,
to
It supports employment flexibility and employee
career development and recognises the importance of
creating an environment that is conducive to the
appointment of
suitably qualified employees,
management and Board candidates who will maximise
the achievement of the corporate goals.
When a vacancy exists, through whatever cause, or
where the Board considers that it would benefit from
the services of a new member with particular skills,
the Board considers a panel of candidates identified
and selected by the Board having regard to:
Best practice recommendations
issued by ASX
recommend a separate disclosure of measurable
objectives for measuring gender diversity and the
proportion of women employees
in the whole
organisation, in senior positions and on the Board.
a) what may be appropriate for the Company
and the Group;
b) the skills, expertise and experience of the
candidates;
c) the mix of those skills, expertise and experience
The Board is of the view that given the size of the
Group and of the Board, it is considered that setting
diversity targets and measurement systems are not
appropriate and hence PTB Group does not fully
comply with this guideline.
with those of the existing Directors; and
Board and Committee Evaluation Process
d) the perceived compatibility of the candidates
with the Group and with the existing Directors.
Potential candidates to be appointed as Directors
are considered by the Board with advice from an
external consultant as considered by the Board to be
appropriate. The Board then appoints the most
suitable candidates who (assuming that they consent
to act as Directors) continue in office only until the
next AGM and are then eligible for re-election but
are not taken into account in determining the number
the
retire by
of Directors
AGM. Security holders are provided with all
rotation at
to
The performance of the Board, its committees,
and individual Directors is evaluated annually by the
Chairman in accordance with the Group’s Corporate
Governance Charter. This review includes the mix and
experience and skills represented, the effectiveness of
Board processes, and
the performance and
contribution of individual members in terms of the
execution of the required Board functions as described
above, for the relevant year. Members of the Board
whose performance is unsatisfactory are asked to
retire. The Charter is available on the Company’s
website. It is considered that an informal annual
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 CORPORATE GOVERNANCE STATEMENT
For the year ended 30 June 2018
23
evaluation of the performance of the Board, its
committees and the Directors by the Chairman is
appropriate given the size and complexity of the
business.
Senior Management Evaluation Process
The process for evaluating the performance of senior
management includes a process of annual appraisals
measuring performance against goals and key
performance indicators including contributions to
the overall outcomes of the business.
Performance evaluations have
accordance with the process disclosed.
taken place
in
Principle 2: Structure the board
to add value
A listed entity should have a board of an appropriate
size, composition, skills and commitment to enable
it to discharge its duties effectively.
Recommendation 2.1
Complies: YES
The board of a listed entity should:
(a) have a nomination committee which:
(1) has at least three members, a majority of
whom are independent directors; and
(2) is chaired by an
independent director,
and disclose:
Recommendation 2.3
Complies: YES
A listed entity should disclose:
(a) the names of the directors considered by the
board to be independent directors;
(b) if a director has an interest, position, association
or relationship of the type described in Box 2.3 but
the board is of the opinion that it does not
compromise the independence of the director, the
nature of the interest, position, association or
relationship in question and an explanation of why
the board is of that opinion; and
(c) the length of service of each director.
Recommendation 2.4
Complies: NO
A majority of the board of a listed entity should be
independent directors.
Recommendation 2.5
Complies: NO
The chair of the board of a listed entity should be an
independent director and, in particular, should not be
the same person as the CEO of the entity.
Recommendation 2.6
Complies: YES
A listed entity should have a program for inducting
new directors and provide appropriate professional
development opportunities for directors to develop
and maintain the skills and knowledge needed to
perform their role as directors effectively.
(3) the charter of the committee;
Nominations Committee
(4) the members of the committee; and
(5) as at the end of each reporting period,
the number of times the committee met
throughout the period and the individual
attendances of
those
meetings; or
the members at
(b) if it does not have a nomination committee,
disclose that fact and the processes it employs to
address board succession issues and to ensure
that the board has the appropriate balance of
skills, knowledge, experience, independence and
diversity to enable it to discharge its duties and
responsibilities effectively.
Recommendation 2.2
Complies: YES
A listed entity should have and disclose a board
skills matrix setting out the mix of skills and diversity
that the board currently has or is looking to achieve in
its membership.
Best practice recommendations
issued by ASX
recommend a separate Nominations Committee to
assist the Board and report to it on selection and
appointment issues and practices including those for
senior management and non-executive Directors.
Given the size of the Group and of the Board the
responsibility for this function rests with the Board.
Composition of the Board
The Board performs its role and function in accordance
with the following principles:
a) The Board should comprise at least three and
no more than 10 Directors;
b) The Board must comprise of members with a
broad range of experience, expertise, skills and
contacts relevant to the Group and its business;
c) At
least half of
non-executive Directors
management; and
the Board should be
from
independent
d) The Chairman of the Board should be one of
the independent non-executive Directors.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 24
CORPORATE GOVERNANCE STATEMENT
For the year ended 30 June 2018
The Board is of the view that the current composition
of the Board is adequate to ensure the best interests
of shareholders given the size and nature of the
Group’s operations. In addition, the Chairman has
the deciding vote at any meetings where a vote is
initially tied.
Independence of Board Members
The Board has adopted the following definition of
an Independent Director:
An independent Director is a Director who is not a
member of management (a non-executive Director)
and who:
a) is not a substantial shareholder of the Group
or an officer of, or otherwise associated, directly or
indirectly, with a substantial shareholder of
the Group;
b) has not, within the last three years, been employed
in an executive capacity by the Company or
another Group member, or been a Director after
ceasing to hold any such employment;
c) is not a principal of a professional advisor to
the Company or another Group member, or an
employee materially associated with the service
provided, except in circumstances where the
advisor might be considered to be independent
notwithstanding their position as a professional
advisor due to the fact that fees payable by the
Company to the advisor’s firm represent an
insignificant component of its overall revenue;
d) is not a significant supplier or customer of the
Company or another Group member, or an officer
of or otherwise associated, directly or indirectly,
with a significant supplier or customer;
e) has no significant contractual relationship with the
Company or another Group member other than as
a Director;
f) is free from any interest and any business or other
relationship, which could, or could reasonably be
perceived to, materially interfere with the Director’s
ability to act in the best interests of the Group; and
g) has not served on the Board for a period which
could, or could reasonably be perceived to,
materially interfere with the Director’s ability to act
in the best interests of the Group.
The Board regularly assesses the independence of
each Director in the light of the interests disclosed by
them. The independence of Directors is disclosed in
the annual report. Where the independence of a
Director is lost, this will be immediately disclosed to
the market.
The Board composition does not comply with
recommendation 2.4 and 2.5 of the ASX Corporate
Governance Guidelines as the majority of Directors
are not independent Directors and the Chairman is
not an independent Director as discussed below.
At 30 June 2018, the Board comprised five members
including CL Baker (appointed 09/10/2001), a non-
executive Chairman, APS Kemp
(appointed
25/08/2006), an independent non-executive Director,
RQ Cole (appointed 28/02/2017), an independent
non-executive Director), PP Gunasekara (appointed
01/09/2017), a non-executive Director and SG Smith
(appointed 23/05/16) who is an executive Director
(Managing Director).
The board comprises only two out of five Directors
who meet the definition of independent Directors.
There are however four non-executive Directors.
The chairman is non-executive but does not meet the
independent Director. The board
definition of
is satisfied the mix of skills within the board far
outweigh the benefits of simply complying with
the guidelines. This position will continue to be
monitored over time.
The Board has adopted the following measures to
ensure that independent judgement is achieved and
maintained
its decision-making
processes:
respect of
in
» Two members of the Board are independent
non-executive Directors with significant experience
in corporate governance;
» The majority of the Board are non-executive
Directors;
» The Chairman is a non-executive Director;
» Directors are entitled
independent
professional advice at the Group’s expense,
subject to the approval of the Chairman;
to seek
» Directors having a conflict of interest in relation to
a particular
item of business must absent
themselves from the Board meeting before
commencement of discussion on the topic; and
» Non-executive Directors confer on a needs basis
without management in attendance.
The size and complexity of the business does not
warrant additional Directors at the present time.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 CORPORATE GOVERNANCE STATEMENT
For the year ended 30 June 2018
25
Board Skills Matrix
Best practice commitment
A Board skills matrix has been adopted by the board
of PTB Group Limited (PTB) to ensure the board
maintains an appropriate mix of skills, knowledge,
experience, personal attributes and other criteria
appropriate for the governance of the Group.
The PTB Board is a skills-based board comprising
directors who collectively have the skills, knowledge
and experience to effectively govern and direct the
organisation including governance skills, industry
skills and personal attributes.
The Board skills matrix is reviewed and assessed
annually as part of the board evaluation process.
Individual board member skills are updated annually
as part of the director evaluation process.
A summary of skills, experience and special
responsibilities of each director is disclosed in the
Directors’ Report included in the annual report.
Induction of New Directors, Training and Advice
Directors are provided with relevant information in
relation to the Company and the Group before
accepting appointment, and also with a relevant
induction package on accepting appointment, in each
case appropriate
their
for
responsibilities in office.
to discharge
them
Directors are provided with access to continuing
education in relation to the Group extending to its
business, the industry in which it operates, and
generally information required by them to discharge
the responsibilities of their office.
Each Director has the right to seek independent legal
or other professional advice at the Group’s expense.
Prior approval from the Chairman is required but may
not be unreasonably withheld or delayed.
Principle 3: Act ethically and responsibly
A listed entity should act ethically and responsibly.
Recommendation 3.1
Complies: YES
A listed entity should:
(a) have a code of conduct for its directors, senior
executives and employees; and
(b) disclose that code or a summary of it.
The Group is committed to achieving and maintaining
the highest standards of conduct and has undertaken
various initiatives that are designed to achieve this
objective. The PTB Group’s Corporate Governance
Charter is intended to ‘institutionalise’ good corporate
governance and, generally, to build a culture of best
practice both in the Group’s own internal practices
and in its dealings with others. The Charter is available
on the Company’s website.
The following are a tangible demonstration of the
Group’s corporate governance commitment:
Independent professional advice
With the prior approval of the Chairman, which may
not be unreasonably withheld or delayed, each
Director has the right to seek independent legal and
other professional advice concerning any aspect of
the Group’s operations or undertakings in order to
fulfil their duties and responsibilities as Directors. Any
costs incurred are borne by the Group.
Code of conduct for transactions in securities
The Group has developed and adopted a Securities
Trading Policy (lodged with the ASX) to regulate
dealings in securities by Directors, senior management,
employees and their associates. This is designed to
ensure fair and transparent trading in accordance
with both the law and best practice.
Charter
The Board has adopted a Code of Ethics in its
Corporate Governance Charter that sets out the
principles and standards with which all Group officers
and employees are expected to comply in the
performance of their respective functions. Officers
and employees are expected to:
» Comply with the law;
» Act honestly and with integrity;
» Reduce the opportunity for situations to arise
which result in divided loyalties or conflicts
of interest;
» Use PTB Group’s assets responsibly and in
the best interests of its shareholders; and
» Be responsible and accountable for their actions.
Senior management immediately investigates possible
failures to comply with the principles of ethical and
responsible conduct, employing the use of third party
expertise where necessary. The appropriate level of
disciplinary action is applied where departures from
these principles are confirmed.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 26
CORPORATE GOVERNANCE STATEMENT
For the year ended 30 June 2018
Principle 4: Safeguard integrity
in corporate reporting
A listed entity should have formal and rigorous
processes that independently verify and safeguard
the integrity of its corporate reporting.
Recommendation 4.1
Complies: YES
The board of a listed entity should:
(a) have an audit committee which:
(1) has at least three members, all of whom are
non-executive directors and a majority of
whom are independent directors; and
(2) is chaired by an independent director, who
is not the chair of the board, and disclose:
(3) the charter of the committee;
Audit and Risk Management Committee
(‘ARM Committee’)
The purpose of this Committee is to advise on the
establishment and maintenance of a framework of
internal control and appropriate ethical standards
for the management of the Group. Its current
members are Russell Cole (Independent Non-
Executive Director – Chairman of ARM Committee),
Craig Baker (Non-Executive Director) and Andrew
Kemp (Independent Non-Executive Director).
The Committee performs a variety of functions
relevant to risk management and internal and external
reporting and reports to the Board following each
meeting. Other matters for which the Committee is
responsible include the following:
a) Board and committee structure to facilitate
a proper review function by the Board;
(4) the relevant qualifications and experience
b) Internal control framework including management
of the members of the committee; and
information systems;
(5) in relation to each reporting period, the
number of
the committee met
throughout the period and the individual
attendances of
those
meetings; or
the members at
times
(b) if
it does not have an audit committee,
disclose that fact and the processes it employs
that independently verify and safeguard the
integrity of its corporate reporting, including the
processes for the appointment and removal of the
the
external auditor and
audit engagement partner.
rotation of
the
Recommendation 4.2
Complies: YES
The board of a listed entity should, before it approves
the entity’s financial statements for a financial period,
receive from its CEO and CFO a declaration that, in
their opinion, the financial records of the entity have
been properly maintained and that the financial
statements comply with the appropriate accounting
standards and give a
view
of the financial position and performance of the entity
and that the opinion has been formed on the basis of
a sound system of risk management and internal
control which is operating effectively.
true and
fair
Recommendation 4.3
Complies: YES
A listed entity that has an AGM should ensure that its
external auditor attends its AGM and is available to
answer questions from security holders relevant
to the audit.
c) Corporate
risk assessment and compliance
with internal controls;
d) Management processes supporting external
reporting;
e) Review of financial statements and other financial
information distributed externally;
f ) Review of the effectiveness of the audit function;
g) Review of the performance and independence
of the external auditors;
h) Review of the external audit function to ensure
prompt remedial action by management, where
appropriate, in relation to any deficiency in, or
breakdown of, controls;
i) Assessing the adequacy of external reporting
for the needs of shareholders;
j) Overseeing business continuity planning and
risk mitigation arrangements.
Meetings are held four times each year. A broad
agenda is laid down for each regular meeting
according to an annual cycle. The Committee invites
the external auditors to attend each of its meetings.
PTB Group’s Managing Director and Chief Financial
Officer report in writing to the ARM Committee that:
» The Group’s financial reports are complete and
present a true and fair view, in all material respects,
of the financial condition and operational results
of the Company and Group, and are in accordance
with relevant accounting standards;
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 CORPORATE GOVERNANCE STATEMENT
For the year ended 30 June 2018
27
» The above statement is founded on a sound
system of
internal
compliance and control which implements the
policies adopted by the Board; and
risk management and
» The Group’s risk management and
internal
compliance and control framework is operating
efficiently and effectively in all material respects.
The Charter is available on the Company’s website
and the names, qualifications, and the number of
meetings attended has been disclosed
in the
Directors’ Report included in the annual report.
The Group’s auditor attends the AGM of the Company
and is available to answer questions in relation to the
audit of the financial report.
Principle 5: Make timely and
balanced disclosure
A listed entity should make timely and balanced
disclosure of all matters concerning it that a reasonable
person would expect to have a material effect on the
price or value of its securities.
Recommendation 5.1
Complies: YES
A listed entity should:
(a) have a written policy for complying with its
continuous disclosure obligations under
the
Listing Rules; and
(b) disclose that policy or a summary of it.
Continuous Disclosure Obligations
Documented procedures in accordance with the
Corporate Governance Charter are in place to identify
matters that are likely to have a material effect on the
price of the Group’s securities and to ensure those
matters are notified to the ASX in accordance with the
Company’s Listing Rule disclosure requirements. The
Managing Director and Chief Financial Officer are
responsible for monitoring the Group’s activities in
light of its continuous disclosure policy. The Group’s
continuous disclosure obligations are also reviewed as
a standing item on the agenda for each regular
meeting of the Board. Each Director is required at
every such meeting to confirm details of any matter
within their knowledge that might require disclosure
to the market.
is responsible
The Company Secretary
for all
communications with the ASX. All communications
with external stakeholders in respect of sensitive
company information are subject to the relevant
safeguarding and confidentiality procedures. These
communications are undertaken in light of continuous
disclosure requirements of the ASX and the broad
principles of ensuring the market is fully informed of
price sensitive information.
Principle 6: Respect the rights
of security holders
A listed entity should respect the rights of its security
them with appropriate
holders by providing
information and facilities to allow them to exercise
those rights effectively.
Recommendation 6.1
Complies: YES
A listed entity should provide information about itself
and its governance to investors via its website.
Recommendation 6.2
Complies: YES
A listed entity should design and implement an
investor relations program to facilitate effective
two-way communication with investors.
Recommendation 6.3
Complies: YES
A listed entity should disclose the policies and
processes it has in place to facilitate and encourage
participation at meetings of security holders.
Recommendation 6.4
Complies: YES
A listed entity should give security holders the
option to receive communications from, and send
communications to, the entity and its security registry
electronically.
Shareholder Communications
The Board recognises the importance of this principle
and strives to communicate with shareholders both
regularly and clearly, both by electronic means and
using more traditional communication methods.
Company
announcements,
reporting results and main corporate governance
documents are available on the Company’s website.
information, news,
Shareholders are encouraged to attend and participate
at general meetings and are given an opportunity to
put forward questions they would like addressed at
annual general meetings. The Group’s auditors will
always attend the annual general meeting and will be
available to answer shareholders’ questions.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 28
CORPORATE GOVERNANCE STATEMENT
For the year ended 30 June 2018
Principle 7: Recognise and manage risk
Risk Management
listed entity should establish a sound risk
framework and periodically review
A
management
the effectiveness of that framework.
Recommendation 7.1
Complies: YES
The board of a listed entity should:
(a) have a committee or committees to oversee risk,
each of which:
(1) has at least three members, a majority of
whom are independent directors; and
(2) is chaired by an independent director, and
disclose:
(3) the charter of the committee;
(4) the members of the committee; and
(5) as at the end of each reporting period, the
number of
the committee met
throughout the period and the individual
attendances of
those
meetings; or
the members at
times
(6) if it does not have a risk committee or
committees that satisfy (a) above, disclose
that fact and the processes it employs for
overseeing the entity’s risk management
framework.
Recommendation 7.2
Complies: YES
The board or a committee of the board should:
(a) review the entity’s risk management framework
at least annually to satisfy itself that it continues
to be sound; and
(b) disclose, in relation to each reporting period,
whether such a review has taken place.
Recommendation 7.3
Complies: YES
A listed entity should disclose:
(a) if it has an internal audit function, how the function
is structured and what role it performs; or
(b) if it does not have an internal audit function, that
fact and the processes it employs for evaluating
and continually improving the effectiveness of its
risk management and internal control processes.
Recommendation 7.4
Complies: YES
A listed entity should disclose whether it has any
material exposure to economic, environmental and
social sustainability risks and, if it does, how it
manages or intends to manage those risks.
The Board is responsible for oversight of the
Group’s risk management and control framework.
The ARM Committee assists the Board in fulfilling
its responsibilities in this regard by reviewing the
financial and reporting aspects of the Group’s risk
management and control framework. The Group has
implemented a policy framework included in the
Corporate Governance Charter, designed to ensure
that the Group’s risks are identified and that controls
are adequate, in place, and functioning effectively.
This framework incorporates the maintenance of
comprehensive policies, procedures and guidelines
that encompass the Group’s activities. It addresses
areas such as, occupational health and safety,
environmental management,
IT
disaster recovery and business continuity planning.
Responsibility for control and risk management is
delegated to the appropriate level of management
within the Group with the Managing Director and
Chief Financial Officer having ultimate responsibility
to the Board for the Group’s risk management and
internal control activities.
trade practices,
Arrangements put in place by the Board to monitor
risk management include:
» Regular monthly reporting to the Board in respect
the financial position
of operations and
of the Group;
» Reports by the Chairman of the ARM Committee
and circulation to the Board of the minutes of
each meeting held by the ARM Committee;
» Presentations made to the Board throughout
the year by appropriate members of the Group’s
management team (and/or independent advisers,
where necessary) on the nature of particular
risks and details of the measures which are either
in place or can be adopted
to manage
or mitigate the risk; and
» Any Director may request that operational and
project audits be undertaken by management.
The risk management framework included in the
Audit and Risk Management Committee Charter is
available on the Company’s website and is reviewed at
least annually. The last review was in January 2018.
Internal Audit
The Group currently does not have an internal audit
function. Considerable importance is placed on
maintaining a strong control environment both
financially and operationally. The audit committee and
the board continue to monitor the need for an internal
audit function as the business grows and through the
independent expertise on the audit committee in
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 CORPORATE GOVERNANCE STATEMENT
For the year ended 30 June 2018
29
conjunction with reporting from external auditors and
industry certification audits which regularly evaluate
the effectiveness of its risk management and internal
control processes.
Economic, Environmental and
Social Sustainability Risks
The group is not subject to any material exposure
to economic, environmental and social sustainability
risks.
Principle 8: Remunerate fairly
and responsibly
A listed entity should pay director remuneration
sufficient to attract and retain high quality directors
and design its executive remuneration to attract,
retain and motivate high quality senior executives and
to align their interests with the creation of value for
security holders.
Recommendation 8.1
Complies: NO
8.1(a)(2) not complied with
The board of a listed entity should:
(a) have a remuneration committee which:
(1) has at least three members, a majority of
whom are independent directors; and
(2) is chaired by an independent director, and
disclose:
(3) the charter of the committee;
(4) the members of the committee; and
(5) as at the end of each reporting period, the
number of
the committee met
throughout the period and the individual
attendances of
those
meetings; or
the members at
times
(b) if it does not have a remuneration committee,
disclose that fact and the processes it employs for
setting the level and composition of remuneration
for directors and senior executives and ensuring
that such remuneration is appropriate and not
excessive.
Recommendation 8.2
Complies: YES
A listed entity should separately disclose its policies
and practices regarding the remuneration of non-
executive directors and the remuneration of executive
directors and other senior executives.
Recommendation 8.3
Complies: YES
A listed entity which has an equity-based remuneration
scheme should:
(a) have a policy on whether participants are permitted
to enter into transactions (whether through the
use of derivatives or otherwise) which limit the
economic risk of participating in the scheme; and
(b) disclose that policy or a summary of it.
Remuneration Committee
The purpose of this Committee is to assist the
Board and report to it on remuneration and issues
relevant to remuneration policies and practices
for senior management and
including
non-executive Directors. These policies are included
in the Group’s Corporate Governance Charter. Its
current members are Craig Baker (Chairman), Russell
Cole and Andrew Kemp.
those
its composition does not
Russell Cole and Andrew Kemp are independent
Directors and
fully
comply with the recommendations in 8.1 of the
ASX Corporate Governance Guidelines as it is not
chaired by an independent director. The Board
believes this is acceptable given the size of the Group,
the nature of its business and the commercial
experience of the members.
Among the functions performed by the Committee
are the following:
a) Review and evaluation of market practices
and trends on remuneration matters;
b) Recommendations to the Board in relation to the
Group’s remuneration policies and procedures;
c) Oversight of
the performance of
senior
management and non-executive Directors; and
d) Recommendations to the Board in relation to
the remuneration of senior management and non-
executive Directors.
The Group’s polices relating
to Non-Executive
Directors’ and Executive Directors and Senior
the
Executives’
annual report.
remuneration are set out
in
It is the Group’s objective to provide maximum
stakeholder benefit from the retention of a high
quality Board and executive team by remunerating
Directors and key executives fairly.
Equity-Based Remuneration Scheme
The Group does not currently operate an equity-based
remuneration scheme.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
30
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
For the year ended 30 June 2018
Consolidated Statement of Profit or Loss
and Other Comprehensive Income
Revenue
Total Revenue
Changes in inventories of finished goods and work in progress
Raw materials and consumables used and finished goods
purchased for sale
Employee benefits expense
Depreciation and amortisation
Repairs and maintenance
Bad and doubtful debts
Finance costs
Net foreign exchange gain/(loss)
Net gain/(loss) on sale of property, plant and equipment
Other expenses
Total expenses
Profit/(Loss) before income tax expense
Income tax (expense)/benefit
Profit/(Loss)
of the parent entity
for
the year attributable
to
the owners
Other comprehensive income net of tax:
Exchange differences on translation of foreign operations
Total comprehensive income/(loss) for the year attributable
to the owners of the parent entity
Basic earnings per share
Diluted earnings per share
Note
2
3
4
20
20
2018
$’000
40,611
40,611
2017
$’000
46,551
46,551
2,166
797
(25,419)
(31,568)
(5,803)
(1,863)
(154)
(175)
(899)
246
–
(5,674)
(1,965)
(80)
808
(936)
42
–
(4,036)
(3,818)
(35,937)
(42,394)
4,674
(1,431)
3,243
4,157
(1,209)
2,948
(7)
–
3,236
2,948
Cents
Cents
5.17
5.17
5.66
5.66
The consolidated statement of profit or loss and other comprehensive income should be read in conjunction with
the accompanying notes.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
For the year ended 30 June 2018
31
Consolidated Statement of
Financial Position
Current Assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other current assets
Total Current Assets
Non-Current Assets
Trade and other receivables
Inventories
Property, plant and equipment
Deferred tax assets
Intangible assets
Other non-current assets
Total Non-Current Assets
Total Assets
Current Liabilities
Trade and other payables
Borrowings
Current tax liabilities
Provisions
Other current liabilities
Total Current Liabilities
Non Current Liabilities
Borrowings
Deferred tax liabilities
Provisions
Other non-current liabilities
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Issued Capital
Reserves
Retained earnings
Total Equity
Note
2018
$’000
2017
$’000
19(a)
5
6
8
5
6
9
10
11
8
12
13
7
15
16
13
14
15
16
17
18
4,184
10,119
24,403
585
2,427
17,753
22,237
229
39,291
42,646
7,133
2,543
19,385
2,472
4,334
–
35,867
75,158
4,249
1,776
–
735
1,871
8,631
14,563
3,630
438
581
19,212
27,843
47,315
43,121
14,360
2,904
2,309
18,171
4,013
4,334
–
31,731
74,377
6,865
12,527
–
741
1,557
21,690
3,493
3,741
430
270
7,934
29,624
44,753
40,657
14,262
(10,166)
(10,166)
47,315
44,753
The consolidated statement of financial position should be read in conjunction with the accompanying notes.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
32
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2018
Consolidated Statement of
Changes in Equity
Issued Capital
Reserves
Share
Capital
Note
$’000
Other
Equity
Securi
-ties
$’000
Total
Issued
Capital
$’000
Dividend
Approp
-riation
Reserve
$’000
Foreign
Currency
Trans
-lation
$’000
Balance at 1 July 2016
33,713
183
33,896
13,956
Total comprehensive income
Profit for the year
Other comprehensive
income
Total comprehensive
income for the year
–
–
–
Transactions with owners in their capacity
as owners and other transfers
Contributions of equity
net of transaction cost
Transfer to reserves
Dividends recognised
for the year
17
18
18
6,761
–
–
–
–
–
–
–
–
–
–
–
6,761
–
–
–
–
–
–
2,948
(2,642)
Balance at 30 June 2017
40,474
183
40,657
14,262
Balance at 1 July 2017
40,474
183
40,657
14,262
Total comprehensive income
Profit for the year
Other comprehensive
income
Total comprehensive
income for the year
–
–
–
Transactions with owners in their capacity
as owners and other transfers
Contributions of equity
net of transaction cost
Transfer to reserves
Dividends recognised
for the year
17
18
18
2,464
–
–
–
–
–
–
–
–
–
–
–
2,464
–
–
–
–
–
–
3,243
(3,138)
Retained
Earnings
Total
Equity
$’000
$’000
(10,166)
37,686
2,948
2,948
–
–
2,948
2,948
–
6,761
(2,948)
–
–
(2,642)
(10,166)
44,753
(10,166)
44,753
3,243
3,243
–
–
–
–
–
–
–
-
-
–
(7)
–
(7)
(7)
3,243
3,236
–
–
–
–
2,464
(3,243)
–
–
(3,138)
Balance at 30 June 2018
42,938
183
43,121
14,367
(7)
(10,166)
47,315
The consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 30 June 2018
33
Consolidated Statement of
Cash Flows
Cash Flow From Operating Activities
Cash receipts from customers (inclusive of GST)
Cash payments to suppliers and employees (inclusive of GST)
Interest received
Finance costs
Income tax refunded/(paid)
Note
2018
$’000
2017
$’000
45,398
39,532
(40,916)
(41,993)
327
(899)
–
187
(936)
–
Net cash provided by/(used in) operating activities
19(b)
3,910
(3,210)
Cash Flow From Investing Activities
Payments for property, plant and equipment
Proceeds on disposal of property, plant and equipment
Net cash provided by/(used in) investing activities
Cash Flow From Financing Activities
Proceeds from borrowings
Proceeds from issue of shares
Repayment of borrowings
Repayment of lease liabilities
Payment of dividends
Net cash used in financing activities
Net increase/(decrease) in cash and cash equivalents held
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
19(a)
(2,432)
(1,523)
–
–
(2,432)
(1,523)
2,179
1,128
4,608
3,008
(2,204)
(1,899)
–
(824)
279
1,757
2,427
4,184
–
(539)
5,178
445
1,982
2,427
The consolidated statement of cash flows should be read in conjunction with the accompanying notes.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
34
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
Notes to the Financial Statements
1. Summary of Significant
Accounting Policies
The principal accounting policies adopted in the
preparation of the financial report are set out below.
These policies have been consistently applied to all
the years presented, unless otherwise stated. The
financial report includes the financial statements for
PTB Group Limited as the consolidated entity
consisting of PTB Group Limited and its subsidiaries.
(a) Basis of preparation
These general purpose financial statements have
been prepared in accordance with the Corporations
Act 2001, Australian Accounting Standards and
Interpretations of the Australian Accounting Standards
Board and International Financial Reporting Standards
as issued by the International Accounting Standards
Board. This Company is a for-profit entity for financial
reporting purposes under Australian Accounting
Standards. Material accounting policies adopted in
the preparation of these financial statements are
presented below and have been consistently applied
unless stated otherwise.
Except for cash flow information, the financial
statements have been prepared on an accruals
basis and are based on historical costs, modified,
where applicable, by the measurement at fair value
of selected non-current assets, financial assets
and financial liabilities.
The Financial Statements were authorised by the
Board of Directors for issue on 29 August 2018.
Historical cost convention
These financial statements have been prepared under
the historical cost convention, as modified by the
revaluation of available-for-sale financial assets,
financial assets and liabilities (including derivative
instruments) at fair value through the statement of
profit or loss and other comprehensive income, and
certain classes of property, plant and equipment.
Critical accounting estimates
The preparation of financial statements in conformity
with IFRS requires the use of certain critical accounting
estimates. It also requires management to exercise its
judgement in the process of applying the Company’s
accounting policies. The areas involving a higher
degree of judgement or complexity, or areas where
assumptions and estimates are significant to the
financial statements are disclosed in note 1(ad).
(b) Principles of consolidation
The consolidated financial statements incorporate the
assets and liabilities of all subsidiaries of PTB Group
Limited (“company” or “parent entity”) as at 30 June
2018 and the results of all subsidiaries for the year
then ended. PTB Group Limited and its subsidiaries
together are referred to in this financial report as the
Group or the consolidated entity. The parent controls
an entity when it 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 over the entity. For details of the subsidiaries
refer note 28.
Subsidiaries are fully consolidated from the date on
which control is transferred to the Group. They are
de-consolidated from the date that control ceases.
The acquisition method of accounting is used to
account for business combinations by the Group
(refer note 1(i)).
Intercompany transactions, balances and unrealised
gains on transactions between Group companies are
eliminated. Unrealised losses are also eliminated
unless the transaction provides evidence of the
impairment of the asset transferred. Accounting
policies of subsidiaries have been changed where
necessary to ensure consistency with the policies
adopted by the Group.
(c) Segment reporting
Operating segments are reported in a manner
consistent with the internal reporting provided to the
chief operating decision maker. The chief operating
decision maker, who is responsible for allocating
resources and assessing performance of the operating
segments, has been identified as the Executive
Directors.
(d) 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
currency’). The
(‘functional
entity
consolidated financial statements are presented in
Australian dollars, which is PTB Group Limited’s
functional and presentation currency.
operates
(ii) Transactions and balances
Foreign currency transactions are translated into
the functional currency using the exchange rates
prevailing at the dates of the transactions. Foreign
losses resulting from the
exchange gains and
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
35
settlement of such transactions and from the
translation at year-end exchange rates of monetary
foreign
liabilities denominated
assets and
currencies are recognised in the statement of profit or
loss and other comprehensive income, except when
deferred in equity as qualifying cash flow hedges and
qualifying net investment hedges or are attributable to
part of the net investment in a foreign operation.
in
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. Translation differences on
non-monetary assets and liabilities such as equities
held at fair value through the statement of profit or
loss and other comprehensive income are recognised
in the statement as part of the fair value gain or
loss. Translation differences on non-monetary
financial assets such as equities classified as available-
for-sale financial assets are included in the fair value
reserve in equity.
(iii) Group companies
The results and financial position of all the Group
entities (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 the date of that statement of
financial position;
»
Income and expenses for each statement of profit
or loss and other 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 the Consolidated Statement of Profit or Loss.
On consolidation, exchange differences arising from
the translation of any net investment in foreign
entities, and of borrowings and other financial
such
instruments designated as hedges of
investments, are recognised in other comprehensive
income. When a foreign operation is sold or any
borrowings forming part of the net investment are
repaid, a proportionate share of such exchange
differences are recognised in the statement of profit
or loss and other comprehensive income statement,
as part of the gain or loss on sale where applicable.
(e) Revenue recognition
received or
Revenue is measured at the fair value of the
receivable. Amounts
consideration
disclosed as revenue are net of returns, trade
allowances, rebates, and amounts collected on behalf
of third parties.
The Group recognises revenue when the amount of
revenue can be reliably measured, it is probable that
future economic benefits will flow to the entity and
specific criteria have been met for each of the Group’s
activities as described below. The Group bases its
estimates on historical
into
consideration the type of customer, the type of
transaction and the specifics of each arrangement.
The amount of revenue is not considered to be reliably
measurable
relating
to the sale have been resolved.
contingencies
results,
taking
until
all
Revenue is recognised for the major business activities
as follows:
that
» Revenue from the sale of goods is recognised
when persuasive evidence exists
the
significant risks and rewards of ownership
of the goods have passed to the buyer, the
consideration can be measured reliably and
collectability is probable. Risks and rewards are
considered passed to the buyer at time of delivery
to the customer or where an executed sales
agreement, or an arrangement exists, indicating
there has been a transfer of the risks and rewards
to the customer, the goods are complete and
available to be dispatched;
» Revenue from repairs is recognised at the time the
service is performed;
» Revenue from the sale of goods and provision
of services under maintenance contracts
is
recognised in accordance with the stage of
completion method unless the outcome of the
contract cannot be reliably estimated. When the
outcome of the contract cannot be reliably
estimated, contract costs are recognised as an
expense as incurred, and where it is probable that
costs will be recovered, revenue is recognised to
the extent of costs incurred;
»
on
credit
extended
Interest
receivables
(under hire purchase agreements) is recognised
progressively by the Group over the hire purchase
term to achieve a constant periodic rate of
return on the carrying amount of the receivable
(being the Group’s net investment in the hire
purchase arrangement);
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 36
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
» Rental
is
income
recognised on a basis
representative of the time pattern in which
the benefit of use derived from the asset is
diminished. For engines
is
recognised based on an hourly rate and hours of
usage. For aircraft rental, income is recognised on
a straight-line basis over the lease term;
income
rental,
(f) Unearned revenue
Unearned revenue includes amounts received in
advance from customers. Such amounts are recorded
as revenue in the statement of profit or loss and other
comprehensive income when the above revenue
recognition criteria are met.
(g) Income tax
The income tax expense for the year is the tax payable
on the current year’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 and to unused
tax losses.
Deferred tax assets and liabilities are recognised
for temporary differences at the tax rates expected
to apply when the assets are recovered or liabilities
are settled, based on those tax rates which are
enacted or substantively enacted for each jurisdiction.
The relevant tax rates are applied to the cumulative
amounts of deductible and
temporary
differences to measure the deferred tax asset or
liability. An exception is made for certain temporary
differences arising from the initial recognition of an
asset or a liability. No deferred tax asset or liability
is recognised in relation to these temporary differences
if they arose in a transaction, other than a business
combination, that at the time of the transaction
did not affect either accounting profit or taxable
profit or loss.
taxable
Deferred tax assets are recognised for deductible
temporary differences and unused tax losses only
if it is probable that future taxable amounts will
be available to utilise those temporary differences
and losses.
Deferred tax liabilities and assets are not recognised
for temporary differences between the carrying
amount and tax bases of investments in controlled
entities where the parent entity is able to control the
timing of the reversal of the temporary differences
and it is probable that the differences will not reverse
in the foreseeable future.
Deferred tax assets and liabilities are offset when
there is a legally enforceable right to offset current tax
assets and
the deferred
liabilities and when
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.
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.
Tax consolidation legislation
the
implemented
PTB Group Limited and its wholly-owned Australian
controlled entities have
tax
consolidation legislation effective 1 July 2008. The
head entity, PTB Group 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 standalone
taxpayer in its own right.
In addition to its own current and deferred tax
amounts, PTB Group 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. Assets or liabilities arising under
tax funding agreements with the tax consolidated
entities are recognised as 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. PTB Group limited may also require payment
its
interim funding amounts to assist with
of
obligations to pay tax instalments. The funding
amounts are recognised as current intercompany
receivables or payables.
(h) Leased assets
Leases are classified as finance leases whenever the
terms of the lease transfer substantially all the risks
and rewards of ownership to the lessee. All other
leases are classified as operating leases.
As lessor
Amounts due from lessees under finance leases are
recorded as receivables. Finance lease receivables are
initially recognised at amounts equal to the net
investment in the lease. Finance lease payments
receivable are allocated between interest revenue and
reduction of the lease receivable over the term of the
lease in order to reflect a constant periodic rate of
return on the net investment outstanding in respect
of the lease.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
37
For operating leases, the leased asset (rental engines
and aircraft) is classified as a non-current asset and
depreciated in accordance with the depreciation
policy set out in note 1(p). Rental income from
operating leases is recognised as set out in note 1(e).
As lessee
leases are
Assets held under finance
initially
recognised at their fair value or, if lower, at amounts
equal to present value of the minimum lease
payments, each determined at the inception of the
lease. The corresponding liability to the lessor is
included in the statement of financial position as a
finance lease obligation, net of finance charges.
Lease payments are apportioned between finance
charges and reduction of the lease obligation so as to
achieve a constant rate of interest on the remaining
balance of the liability. Finance charges are charged
directly against income, unless they are directly
attributable to qualifying assets, in which case they
are capitalised in accordance with the consolidated
entity’s general policy on borrowing costs. Refer to
note 1(t).
Finance leased assets are amortised on a diminishing
value basis over the estimated useful life of the asset.
Refer note 1(p).
Operating lease payments are recognised as an
expense on a straight-line basis over the lease term,
except where another systematic basis is more
representative of the time pattern in which economic
benefits from the leased asset are consumed.
(i) 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 fair value
of the assets transferred, equity instruments issued or
liabilities incurred or assumed at the date of exchange.
The consideration transferred also includes the fair
value of any contingent consideration arrangement
and the fair value of any pre-existing equity interest in
the subsidiary.
liabilities assumed
Acquisition-related costs are expensed as incurred.
Identifiable assets acquired and
liabilities and
in a business
contingent
combination are, with limited exceptions, measured
initially at their fair values at the acquisition date.
On an acquisition-by-acquisition basis, the Group
the
recognises any non-controlling
acquiree either at fair value or at the non-controlling
interest’s proportionate share of the acquiree’s net
identifiable assets.
interest
in
The excess of the consideration transferred, the
amount of any non-controlling interest in the acquiree,
and the acquisition-date fair value of any previous
equity interest in the acquiree over the fair value of
the Group’s share of the net identifiable assets
acquired is recorded as goodwill. If those amounts are
less than the fair value of the net identifiable assets
of the subsidiary acquired and the measurement of
all amounts has been reviewed, the difference is
recognised directly in profit and 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
terms
independent financier under comparable
and conditions.
(j) Impairment of assets
Goodwill and intangible assets that have an indefinite
useful life are not subject to amortisation and are
tested annually for impairment or more frequently if
events or changes in circumstances indicate that they
might be impaired. Other assets are reviewed for
impairment whenever events or changes
in
circumstances indicate that the carrying amount may
not be recoverable. 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
impairment, assets are grouped at the lowest levels
for which there are separately identifiable cash inflows
(cash generating units).
(k) 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
the
in current
statement of financial position.
liabilities on
(l) Trade and other receivables
Trade and other receivables are recognised initially
at fair value and subsequently measured at amortised
cost using the effective interest method, less provision
impairment. Trade receivables are due for
for
settlement in 30 to 90 days.
Collectability of receivables is reviewed on an ongoing
basis. Debts which are known to be uncollectible are
written off by reducing the carrying amount directly.
A provision for impairment is established when there
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 38
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
is objective evidence that the Group will not be able to
collect all amounts due according to the original terms
of receivables. The amount of the provision is the
difference between the asset’s carrying amount and
the present value of estimated future cash flows,
discounted at the original effective interest rate. The
amount of the provision is recognised in the statement
of profit or loss and other comprehensive income.
Cash flows relating to short-term receivables are not
discounted if the effect of discounting is immaterial.
(m) Inventories
Raw materials, work in progress, and finished goods
Inventories are stated at the lower of cost and net
realisable value. Costs are assigned to individual items
of stock by specific identification. Net realisable value
is the estimated selling price in the ordinary course of
business less the estimated costs of completion and
the estimated costs necessary to make the sale.
Loans and receivables are initially recognised at
fair value plus transaction costs and subsequently
the effective
carried at amortised cost using
interest method.
The Group assesses at each balance date whether
there is objective evidence that a financial asset or
group of financial assets is impaired. Losses are
recognised in the statement of profit or loss and other
comprehensive income and reflected in an allowance
account. When an event occurring after
the
impairment was recognised causes the amount of the
impairment
in
to decrease
impairment loss is reversed through the statement
of profit or loss and other comprehensive income.
When the Directors are of the view that collection
is no longer possible and the recovery action has
ceased the amount in the allowance account is
offset against the loan or receivable.
the decrease
loss
Fair value estimation
Inventories are classified as non-current assets
if the asset is expected to be realised in a period
greater than twelve months from balance date.
The fair value of financial assets and financial liabilities
must be estimated for recognition and measurement
or for disclosure purposes.
(n) Other financial assets
The Group classifies its financial assets in the following
categories: financial assets at fair value through the
statement of profit or loss and other comprehensive
income,
loans and receivables, held-to-maturity
investments, and available-for-sale financial assets.
The classification depends on the purpose for which
the
investments were acquired. Management
determines the classification of its investments at
initial recognition and re-evaluates this designation at
each reporting date.
The Group has no financial assets at fair value through
profit and loss, held-to-maturity investments or
available-for-sale financial assets.
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 the balance
date which are classified as non-current assets. Loans
and receivables are included in trade and other
receivables in the statement of financial position.
The fair value of financial instruments traded in active
markets (such as publicly traded derivatives, and
trading and available-for-sale securities) is based on
quoted market prices at the reporting date. The
quoted market price used for financial assets held by
the Group is the current bid price; the appropriate
quoted market price for financial liabilities is the
current ask price.
The fair value of financial instruments that are not
traded in an active market is determined using
valuation techniques. The Group uses a variety of
methods and makes assumptions that are based on
market conditions existing at each reporting date.
Quoted market prices or dealer quotes for similar
instruments are used for long-term debt instruments
held. Other techniques, such as estimated discounted
cash flows, are used to determine fair value for the
remaining financial instruments.
The nominal value less estimated credit adjustments
of trade receivables and payables are assumed to
approximate their fair values due to their short-term
nature. The fair value of financial liabilities for
disclosure purposes is estimated by discounting the
future contractual cash flows at the current market
interest rate that is available to the Group for similar
financial instruments.
(o) Leasehold improvements
The cost of improvements to or on leasehold
properties is amortised over the unexpired period of
the
life of the
improvement to the Group, whichever is the shorter.
Refer note 1(p).
lease or the estimated useful
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
39
Certain items of plant and equipment, primarily rental
engines, are required to be overhauled on a regular
basis. This is managed as part of an ongoing major
cyclical maintenance program. The costs of this
maintenance are charged as expenses as incurred,
except where they relate to the replacement of a
component of an asset, in which case the costs are
capitalised and depreciated in accordance with the
above. The carrying amount of the replaced part is
de-recognised. Other routine operating maintenance,
repair and minor renewal costs are also charged as
expenses as incurred.
The assets’ residual values and useful lives are
reviewed, and adjusted
if appropriate, at each
balance date.
An asset’s carrying amount
is written down
immediately to its recoverable amount if the asset’s
carrying amount
its estimated
recoverable amount (note 1 (j)).
is greater than
Gains and losses on disposals are determined by
comparing proceeds with the carrying amount. These
are included in the statement of profit or loss and
other comprehensive income. When re-valued assets
are sold, it is Group policy to transfer the amounts
included in revaluation reserves in respect of those
assets to retained earnings.
(p) Property, plant and equipment
Property, plant and equipment is stated at historical
cost less accumulated depreciation. Historical cost
includes expenditure that is directly attributable to the
acquisition of the items. Cost may also include
transfers from equity of any gains/losses on qualifying
cash flow hedges of foreign currency purchases of
property, plant and equipment.
Subsequent costs are included in the asset’s carrying
amount or recognised as a separate asset, as
appropriate, only when it is probable that future
economic benefits associated with the item will
flow to the Group and the cost of the item can be
measured reliably. All other repairs and maintenance
are charged to the statement of profit or loss and
other comprehensive income during the financial
period in which they are incurred.
in
Increases
the carrying amounts arising on
revaluation of land and buildings are credited, net
of tax, in other comprehensive income and to the
revaluation reserve in shareholders’ equity. 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 to profit or loss.
Land is not depreciated. Depreciation on other assets
is generally calculated on a straight-line (SL) or
diminishing value (DV) basis so as to allocate the cost,
net of residual values, of each item of property, plant
and equipment (excluding land and rental engines)
over its estimated useful life to the Group. For rental
engines, depreciation is based on the estimated
operating hours. The line item in the statement of
profit or loss and other comprehensive income in
amortisation
which
of property, plant and equipment is included is
‘depreciation and amortisation’.
depreciation
and
the
The estimated useful lives are as follows:
Class
Buildings
Leasehold improvements
Life
40 years
5 years
Leasehold improvements - leased
6 years
Plant and equipment
3–10 years
Plant and equipment – leased
6–8 years
Basis
SL
SL
SL
DV
DV
Rental engines
5,500–7,000 hours
Actual hours as a proportion of
estimated total operating hours
Airframes
6-10 years
SL
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 40
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
(q) Intangibles
Goodwill
Goodwill represents the excess of the cost of an
acquisition over the fair value of the Group’s share of
the net identifiable assets of the acquired subsidiary
at the date of the acquisition. Goodwill on acquisitions
of subsidiaries is included in intangible assets.
Goodwill is not amortised. Instead 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 the 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
(note 26).
Computer software
Costs incurred in acquiring software and licenses that
will contribute to future period financial benefits
through revenue generation and/or cost reduction are
capitalised to software and systems. Costs capitalised
include external direct costs of materials and service,
direct payroll and payroll related costs of employees’
time spent on the project. Computer software has a
finite life and is carried at cost less any accumulated
amortisation and any impairment losses. Computer
software is amortised on a straight-line basis over its
estimated useful life. The line item in the statement of
profit or loss and other comprehensive income in
which the amortisation of computer software is
included is ‘depreciation and amortisation’ expense.
(r) Trade and other payables
Trade and other payables are recognised initially
at fair value and subsequently measured at amortised
cost.
These amounts represent liabilities for goods and
services provided to the Group prior to the end of
the financial year which are unpaid. The amounts
are unsecured and are usually paid within 30 days
of recognition.
(s) Borrowings
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
the statement of profit or loss and other comprehensive
interest method. Fees paid on
income over the period of the borrowings using the
effective
the
establishment of loan facilities, which are not an
incremental cost relating to the actual draw-down of
the facility, are recognised as prepayments and
amortised on a straight-line basis over the term of
the facility.
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’
or ‘other expense’.
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 balance date.
(t) Borrowing costs
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. The amount of borrowing costs
capitalised is determined as the actual borrowing
costs incurred as funds are borrowed specifically for
the purpose of obtaining a qualifying asset.
(u) Derivatives and hedging activities
Derivatives are initially recognised at fair value on
the date a derivative contract is entered into and are
subsequently remeasured to their fair value at each
reporting date. The accounting for subsequent
changes in fair value depends on whether the
derivative is designated as a hedging instrument,
and if so, the nature of the item being hedged.
The Group designates certain derivatives as either:
» Hedges of the fair value of recognised assets
and liabilities or a firm commitment (fair value
hedges);
» Hedges of the cash flows of recognised assets
forecast
liabilities and highly probable
and
transactions (cash flow hedges); or
» Hedges of a net investment in a foreign operation
(net investment hedges).
the
At the inception of the hedging transaction the Group
relationship between hedging
documents
instruments and hedged items, as well as its risk
management objective and strategy for undertaking
various hedge transactions. The Group also documents
its assessment, both at hedge inception and on an
ongoing basis, of whether the derivatives that are
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
41
used in hedging transactions have been and will
continue to be highly effective in offsetting changes in
fair values or cash flows of hedged items.
The full fair value of a hedging derivative is classified
as a non-current asset or liability when the remaining
maturity of the hedged item is more than 12 months.
If the remaining maturity of the hedged item is less
than 12 months it is classified as a current asset or
liability. Trading derivatives are classified as a current
asset or liability.
Fair value hedge
Changes in the fair value of derivatives that are
designated and qualify as fair value hedges are
recorded in the statement of profit or loss and other
comprehensive income, together with any changes in
the fair value of the hedged asset or liability that are
attributable to the hedged risk. The gain or loss
relating to the effective portion of interest rate swaps
hedging fixed rate borrowings is recognised in the
statement of profit or loss and other comprehensive
income within ‘finance costs’, together with changes
in the fair value of the hedged fixed rate borrowings
attributable to interest rate risk. The gain or loss
relating to the ineffective portion is recognised in the
statement of profit or loss and other comprehensive
income within ‘other income’ or ‘other expenses’.
If the hedge no longer meets the criteria for hedge
accounting, the adjustment to the carrying amount of
a hedged item for which the effective interest method
is used is amortised to the statement of comprehensive
income over the period to maturity using a recalculated
effective interest rate.
Cash flow hedge
The effective portion of changes in the fair value of
derivatives that are designated and qualify as cash
flow hedges is recognised in the statement of profit or
loss and other comprehensive income and in the
hedging reserve in equity. The gain or loss relating
to the ineffective portion is recognised immediately in
the statement of profit or loss and other comprehensive
income within ‘other income’ or ‘other expense’.
Amounts accumulated in equity are recycled in the
statement of profit or loss and other comprehensive
income in the periods when the hedged item affects
profit or loss. The gain or loss relating to the effective
portion of interest rate swaps hedging variable rate
borrowings is recognised in the statement of profit or
loss and other comprehensive income within ‘finance
costs’. The gain or loss relating to the effective portion
of forward foreign exchange contracts hedging export
sales is recognised in the statement of profit or loss
and other comprehensive income within ‘sales’.
However, when the forecast transaction that is hedged
results in the recognition of a non-financial asset
the gains and losses previously deferred in equity
are transferred from equity and included in the initial
measurement of the cost of the asset. The deferred
amounts are ultimately recognised in the statement of
profit or loss and other comprehensive income as
costs of goods sold in the case of inventory, or as
depreciation in the case of property, plant and
equipment.
When a hedging instrument expires or is sold or
terminated, or when a hedge no longer meets the
criteria for hedge accounting, any cumulative gain
or loss existing in equity at that time remains in
equity and is recognised when the forecast transaction
is ultimately
the statement of
comprehensive income. When a forecast transaction
is no longer expected to occur, the cumulative gain or
loss that was reported in equity is immediately
transferred to the statement of profit or loss and other
comprehensive income.
recognised
in
Net investment hedges
Hedges of net investments in foreign operations
are accounted for similarly to cash flow hedges.
Any gain or loss on the hedging instrument relating to
the effective portion of the hedges is recognised
in other comprehensive income and accumulated
reserves in equity. The gain or loss relating to the
ineffective portion is recognised immediately in the
statement of profit or loss and other comprehensive
income, within ‘other income’ or ‘other expense’.
Gains or losses accumulated in equity are included in
the statement of comprehensive income when the
foreign operation is partially disposed of or sold.
Derivatives that do not qualify for hedge accounting
Certain derivative instruments do not qualify for hedge
accounting. Changes in the fair value of any derivative
instrument that does not qualify for hedge accounting
are recognised immediately in the statement of profit
or loss and other comprehensive income and are
included in ‘other income’ or ‘other expenses’.
(v) Employee benefits
Wages and salaries, annual leave and sick leave
Liabilities for wages and salaries, including non-
monetary benefits, annual leave and accumulating
sick leave expected to be settled within 12 months
of the reporting date are recognised in the employee
benefits provision in respect of employees’ services
up to the reporting date and are measured at the
amounts expected to be paid when the liabilities
are settled. The
leave and
accumulating sick leave is recognised in the provision
for employee benefits. All other short-term employee
benefit obligations are presented as payables.
liability for annual
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 42
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
Long service leave
The liability for long service leave is recognised in
the employee benefits provision and measured as the
present value of expected future payments to be
made in respect of services provided by employees up
to the reporting date. Consideration is given to
expected future wage and salary levels, experience
of employee departures and periods of service.
Expected future payments are discounted using
market yields at the reporting date on corporate
bonds with terms to maturity and currency that
match, as closely as possible, the estimated future
cash outflows.
Superannuation
The Group makes contributions to defined contribution
superannuation funds. Contributions are recognised
as an expense as they become payable. Prepaid
contributions are recognised as an asset to the extent
that a cash refund or a reduction in the future
payments is available.
Termination benefits
for restructuring pursuant
When applicable, the Group recognises a liability and
expense for termination benefits at the earlier of; (a)
the date when the Group can no longer withdraw the
offer for termination benefits; and (b) when the Group
recognises costs
to
AASB137: Provisions, Contingent Liabilities and
Contingent Assets and the costs include termination
benefits. In either case, unless the number of
employees affected is known, the obligation for
termination benefits is measured on the basis of the
number of employees expected to be affected.
Termination benefits that are expected to be settled
wholly before 12 months after the annual reporting
period in which the benefits are recognised at the
(undiscounted) amounts expected to be paid. All
other termination benefits are accounted for on the
same basis as other long-term employee benefits.
Share-based payments
Share based compensation benefits are provided to
employees via the PTB Group Limited Employee
Share Option Scheme as detailed in note 22.
The fair value of options granted under the PTB Group
Limited Employee Share Option Scheme is recognised
as an employee benefit expense with a corresponding
increase in equity. The fair value is measured at
grant date and recognised over the period during
which the employees become unconditionally entitled
to the options.
The fair value at grant date is determined using a
Binomial option pricing model that takes into account
the exercise price, the term of the option, the share
price at grant date and expected price volatility of the
underlying share, the expected dividend yield and the
risk free interest rate for the term of the option.
The fair value of the options granted excludes the
impact of any non market vesting conditions (for
example, profitability and sales growth targets and
performance and service criteria). Non market vesting
conditions are included in assumptions about the
number of options that are expected to become
exercisable. At each balance sheet date, the entity
revises its estimate of the number of options that are
expected to become exercisable. The employee
benefit expense recognised each period takes into
account the most recent estimate.
Profit sharing and bonus plans
The Group recognises a provision where contractually
obliged or where there is a past practice that has
created a constructive obligation. Bonus payments
are discretionary and subject to Board approval.
(w) Provisions
Provisions for service warranties and make good
obligations 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 measured at the present value of
management’s best estimate of the expenditure
required to settle the present obligation at the
reporting 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.
(x) Contributed equity
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue
of new shares or options are shown in equity as a
deduction, net of tax, from proceeds.
(y) 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 year but not distributed at balance date.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
43
(z) Earnings per share
(ac) General
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
year, adjusted for bonus elements
in ordinary
shares issued during the year.
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 that would have been outstanding
assuming the conversion of all dilutive potential
ordinary shares.
PTB Group Limited is a public company limited by
shares, incorporated and domiciled in Australia. Listed
below is the registered office, principal place of
business, and its principal administrative office:
22 Orient Avenue
Pinkenba QLD 4008
(ad) Critical accounting estimates
and judgements
The Group evaluates estimates and judgements
incorporated into the financial report based on
historical knowledge and best available current
information. Estimates
reasonable
expectation of future events and are based on current
trends and economic data, obtained both externally
the company. Key estimates and
and within
judgements
the financial statements
impacting
are as follows:
assume
a
(aa) Goods and services tax
Impairment
Revenues, expenses and assets are recognised
net of the amount of goods and services tax (GST),
except:
» Where the amount of GST incurred is not
recoverable from the taxation authority, it is
recognised as part of the cost of acquisition of
an asset or as part of an item of expense;
»
For receivables and payables which are recognised
inclusive of GST. The net amounts of GST
recoverable from, or payable to, the taxation
authority is included as part of receivables or
payables; or
» Cash flows are presented on a gross basis and 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.
(ab) Rounding of amounts
The company is of a kind referred to in legislative
instrument 2016/191 relating to the “rounding off”
of amounts in the financial statements. Amounts in
the financial statements have been rounded off in
accordance with that legislative instrument to the
nearest thousand dollars, or in certain cases, the
nearest dollar.
The Group tests six monthly whether goodwill
has suffered any impairment in accordance with the
accounting policy stated in note 1(j). The recoverable
amounts of cash-generating units have been
determined based on value-in-use calculations. These
calculations require the use of assumptions. Refer to
note 11 for details of these assumptions and the
potential impact of changes to the assumptions.
Long Service Leave (LSL)
The Group estimates the pattern of LSL taken based
on history and utilises management’s judgement in
determining the cash flow estimates of payments of
LSL. These estimates are then utilised to determine
the NPV of these expected LSL payments and the
adequacy of the provision.
Hire Purchase Receivables
Management applies judgement in assessing the
recoverability of its hire purchase receivables The
Group assesses both the current payment performance
and operational knowledge of the debtor’s business
operation as the Group is in regular contact with the
debtor as it is responsible for undertaking scheduled
engine maintenance and is a supplier of spare parts
for the aircraft under lease to the LT HP debtors
maintenance department.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 44
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
(ae) Fair value of assets and liabilities
(af) New accounting standards
and interpretations
Certain new accounting standards and interpretations
have been published that are not mandatory for 30
June 2018 reporting periods and have not been early
adopted by the Group. The financial impact of these
changes to accounting standards has not yet been
determined. The following new standards are to be
applied in future periods:
(i) AASB 9 Financial instruments: significant revisions
to the classification and measurement of financial
assets, reducing the number of categories and
simplifying the measurement choices, including
the removal of impairment testing of assets
measured at fair value. Impact: The standard
introduces additional disclosures. The Group will
adopt this standard from 1 July 2018 but it will have
minimal impact.
(ii) AASB 15 Revenue from Contracts with Customers:
this standard provides guidance on the recognition
of revenue from customers. Impact: The Group
will adopt this standard in July 2018. The Group
believes that current processes for recognition of
revenue from contracts are in line with the
requirements of the new standard and there
should be no impact.
(iii) AASB 16 Leases: significant revisions to accounting
for operational leases by Lessees of property and
high value equipment. Exemptions for short-term
leases and leases of low value assets will reduce
the impact. Impact: The Group will adopt this
standard in July 2019. The adoption of this
standard has been assessed by reviewing existing
operating leases. The review has determined that
the adoption of the standard will have an
immaterial
liabilities and
expenses.
impact on assets,
The Group measures some of its assets and liabilities
at fair value on either a recurring or non-recurring
basis, depending on
the
applicable Accounting Standard.
the requirements of
Fair value is the price the Group would receive to sell
an asset or would have to pay to transfer a liability in
an orderly (i.e. unforced)
transaction between
independent, knowledgeable and willing market
participants at the measurement date.
As fair value is a market-based measure, the closest
equivalent observable market pricing information
is used to determine fair value. Adjustments to market
values may be made having
the
characteristics of the specific asset or liability. The fair
values of assets and
that are not
traded in an active market are determined using
one or more valuation techniques. These valuation
techniques maximise, to the extent possible the
use of the observable market data.
liabilities
regard
to
To the extent possible, the market information is
extracted from either the principal market for the
asset or liability (i.e. the market with the greatest
volume and level of activity for the asset or liability) or,
in the absence of such a market, the most
advantageous market available to the entity at the
end of the reporting period (i.e. the market that
maximises the receipts from the sale of the asset or
minimises the payments made to transfer the liability,
after taking into account transaction costs and
transport costs).
For non-financial assets, the fair value measurement
also takes into account a market participants ability to
use the asset in its highest and best use or to sell it to
another market participant that would use the asset in
its highest and best use.
The fair value of liabilities and the entity’s own
equity instruments (excluding those related to share-
based payment arrangements) may be valued, where
there is no observable market price in relation to the
transfer of such financial instrument, by reference to
such
observable market
instruments are held as assets. Where this information
is not available, other valuation techniques are
adopted and, where significant, are detailed in the
respective note to the financial statements.
information where
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
45
2. Revenue
Sales revenue
Sale of goods
Services
Rental of engines/aircraft
Other revenue
Interest
– Extended credit receivables (hire purchase agreements)
– Other
Other
Total revenue
3. Profit/(Loss) before income tax expense
Profit/(Loss) before income tax expense includes the following specific items:
Depreciation
– Buildings
– Plant and equipment
– Rental engines/aircraft
– Leasehold improvements
Amortisation
– Leased engines/aircraft
Operating lease rentals – minimum lease payments
– Premises
– Equipment and software
Impairment losses/(write back)
– Trade debtors
Superannuation expense
2018
$’000
2017
$’000
28,758
34,835
8,879
2,427
8,558
2,588
40,064
45,981
182
145
220
153
34
383
40,611
46,551
2018
$’000
2017
$’000
124
135
1,546
9
49
127
61
175
437
123
123
1,671
8
40
60
65
(808)
481
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
46
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
4. Income Tax Expense
(a) Income tax expense
Current tax
Deferred tax arising from origination or reversal of temporary differences
Under/(over) provided in prior years
(b) Numerical reconciliation of income tax expense to prima facie tax
Profit/(loss) before income tax expense
Tax at the Australian tax rate of 30% (2017: 30%)
Tax effect of amounts which are not deductible (taxable)
in calculating taxable income:
– Non-deductible expenses
– Foreign income tax rate
– Adjustments for deferred tax assets of prior periods
– Recognised prior year tax losses
– Unrecognised prior year tax losses
Income tax expense/(benefit)
5. Trade and Other Receivables
Current
Trade receivables
Provision for impairment
Maintenance contract receivables
Contract receivables
Extended credit receivables
Non-Current
Trade Receivables
Maintenance contract receivables
Contract receivables
Extended credit receivables
Loan to Related Party
Impaired trade receivables
2018
$’000
2017
$’000
–
1,410
21
1,431
4,674
1,402
6
2
21
–
–
–
1,209
–
1,209
4,157
1,247
2
(17)
–
(26)
3
1,431
1,209
2018
$’000
2017
$’000
8,182
(299)
7,883
1,437
176
623
11,116
(130)
10,986
6,216
–
551
10,119
17,753
557
1,409
3,280
150
1,737
7,133
–
512
–
740
1,652
2,904
As at 30 June 2018 current trade receivables of the Group with a nominal value of $299,468 (2017: $130,493)
were impaired.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
47
5. Trade and Other Receivables (continued)
The ageing of trade receivables is as folows:
Group – 2018
Trade receivables
Impaired trade receivables
Unimpaired receivables
Group – 2017
Trade receivables
Impaired trade receivables
Unimpaired receivables
Past due but not impaired
Current
30+ Days
60+ Days
90+ Days
Total
4,267
(4)
4,263
7,011
–
7,011
436
(3)
433
1,560
–
1,560
913
(2)
911
872
–
872
3,123
(290)
2,833
1,673
(130)
1,543
8,739
(299)
8,440
11,116
(130)
10,986
As at 30 June 2018, unimpaired trade receivables greater than 30 days represent amounts past due but
not impaired. Based on the credit history of these other classes, it is expected that these amounts will be
received. The Group holds retention of title over goods sold until cash is received.
Movements in the provision for impairment of receivables are as follows:
At 1 July
Provision for impairment written back/(recognised) during the year
Receivables written off during the year as uncollectable
At 30 June
Maintenance contract receivables
2018
$’000
(130)
(176)
7
(299)
2017
$’000
(956)
808
18
(130)
Maintenance contract receivables are generally unsecured. The relevant agreements require fixed monthly
payments over the term of the contracts which are generally up to 5 years.
Extended credit receivables
Extended credit receivables represent amounts owed by customers for engines and aircraft sold to those
customers. The amounts owed by customers are secured under hire purchase agreements between the Group
and the customer. The amounts are repayable by the customers by monthly instalments of principal and fixed
interest over periods of 1 to 5 years. Furthermore, the agreements do not include any contingent rentals. The
receivables are secured as the rights to the engine and/or aircraft revert to the Group in event of default. The
engines and aircraft are maintained and insured by the customers and at the end of the term of the agreement
are expected to be retained by the customers.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
48
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
5. Trade and Other Receivables (continued)
Payments in relation to the extended credit receivables
are receivable as follows:
Within one year
Later than one year but not later than five years
Later than five years
Minimum hire purchase payments receivable
Future finance revenue
Within one year
Later that one year but not later than five years
Later than five years
Total extended credit receivables
Representing receivables:
Current
Non-current
2018
$’000
2017
$’000
662
152
–
814
(39)
(2)
–
(41)
773
623
150
773
635
779
–
1,414
(84)
(39)
–
(123)
1,291
551
740
1,291
Refer note 30 for information on amounts receivable from controlled entities.
Risk exposure
Information concerning the exposure to credit risk, foreign exchange and interest rate risk is set out in note 25.
6. Inventories
Current
Work in progress – at cost
Finished goods – at cost
Non-current
Finished goods – at cost
2018
$’000
2017
$’000
3,424
20,979
24,403
2,543
2,543
5,536
16,701
22,237
2,309
2,309
Finished goods include aircraft, engines and parts held for sale. Work in progress includes engines and aircraft
undergoing reconditioning in preparation for sale as well as incomplete repair jobs.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
49
7. Tax balances – Current
Current tax liabilities
8. Other Assets
Current
Prepayments
Deposits
2018
$’000
–
2017
$’000
–
2018
$’000
2017
$’000
585
–
585
226
3
229
9. Property, Plant and Equipment
Rental arrangements – aircraft and engines
The Group rents aircraft and engines under two general arrangements:
» Contingent rentals – rented to customers under agreements with rentals payable monthly and no fixed term.
As such, the agreements are cancellable. The rent is calculated on the basis of an hourly rate and hours of
usage. There are no minimum hours of usage or minimum lease payments set out in the relevant agreements.
As such, in accordance with AASB 117 “Leases” the rental income comprises of contingent rentals not
minimum lease payments. Accordingly, there are no fixed lease commitments receivable; and
» Set or minimum rentals – the operating leases relate to aircraft and/or engines leased to third parties
with lease terms of between 3-7 years. The monthly rental payments are either set or per hour of usage with
minimum hours per annum. In addition, a contingent rental may be receivable based upon hours of usage.
The lessee may have an option to purchase the aircraft/engine at the expiry of the lease period. However, the
final purchase price is determined on a case by case basis in negotiation between the Group and the lessee.
Minimum lease payments in relation to aircraft and engine operating leases are receivable as follows:
No later than one year
Later than one year but not later than five years
Non-current assets pledged as security
Refer note 13 for information on non-current assets pledged as security.
2018
$’000
1,206
2,417
3,623
2017
$’000
1,303
1,839
3,142
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
50
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
9. Property, Plant and Equipment (continued)
Land
&
Build
-ings
Leasehold
Improvements
Plant &
Equipment
Rental
Engines/
Aircraft
Assets Under
Construction
Total
Owned
$’000
Owned
$’000
Under
Lease
$’000
Owned
$’000
Under
Lease
$’000
Owned
$’000
Under
Lease
$’000
Owned
$’000
Under
Lease
$’000
$’000
Year ended
30 June 2017
Opening net
book value
Additions
Transfers1
Disposals
Impairment
Depreciation/
amortisation
Closing net
book value
At 30 June 2017
Cost
Accumulated
depreciation
6,890
26
–
–
–
–
–
–
–
–
(123)
(8)
6,767
18
7,782
(1,015)
93
(75)
Net book value
6,767
18
–
–
–
–
–
–
–
–
–
–
663
120
–
–
–
(123)
660
1,879
(1,219)
660
–
–
–
–
–
–
–
–
–
–
12,575
–
106
– 20,260
1,140
263
(1,597)
–
–
–
–
(1,671)
(40)
–
(50)
–
–
–
10,447
223
56
–
–
–
–
–
–
1,523
(1,647)
–
–
(1,965)
18,171
18,511
(8,064)
263
(40)
10,447
223
56
–
56
– 28,584
–
–
(10,413)
18,171
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
51
Land
&
Build
-ings
Leasehold
Improvements
Plant &
Equipment
Rental
Engines/
Aircraft
Assets Under
Construction
Total
Owned
$’000
Owned
$’000
Under
Lease
$’000
Owned
$’000
Under
Lease
$’000
Owned
$’000
Under
Lease
$’000
Owned
$’000
Under
Lease
$’000
$’000
Year ended
30 June 2018
Opening net
book value
Additions
Transfers1
Disposals
Impairment
Depreciation/
amortisation
FX translation
Closing net
book value
6,767
18
–
–
–
–
–
–
–
–
(124)
(9)
–
6,643
–
9
At 30 June 2018
Cost
7,782
93
Accumulated
depreciation
(1,139)
(84)
Net book value
6,643
9
–
–
–
–
–
–
–
–
–
–
–
660
208
–
–
–
(135)
3
736
2,091
(1,355)
736
–
–
–
–
–
–
–
–
–
–
–
10,447
223
56
231
642
–
–
–
–
–
(1,546)
(49)
–
–
1,993
–
–
–
–
–
9,774
174
2,049
17,996
263
2,049
(8,222)
(89)
–
9,774
174
2,049
–
–
–
–
–
–
–
–
–
–
–
18,171
2,432
642
–
–
(1,863)
3
19,385
30,274
(10,889)
19,385
1 Represents transfer of engine cores and aircraft frames (to)/from inventory.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
52
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
10. Deferred Tax Assets
The balance comprises temporary differences attributable to:
2018
$’000
2017
$’000
1,007
2,704
43
250
77
1,095
2,472
45
249
39
976
4,013
Employee
benefits
$’000
Doubtful
debts
$’000
Other
Total
$’000
$’000
247
2
249
1
287
(248)
39
38
878
98
976
119
4,918
(905)
4,013
(1,541)
Tax losses
Accruals
Employee benefits
Doubtful debts
Other
Total deferred tax assets
Movements
At 1 July 2016
(Charged)/credited
to statement of profit
or loss and other
comprehensive
income
Tax
losses
$’000
3,475
(771)
Accruals
$’000
31
14
At 30 June 2017
2,704
(1,697)
(Charged)/credited
to statement of profit
or loss and other
comprehensive
income
45
(2)
At 30 June 2018
1,007
43
250
77
1,095
2,472
A deferred tax asset of $2.472 million (2017: $4.013 million) has been recognised at 30 June 2018.
This includes $1.007 million attributable to prior years’ income tax losses carried forward (2017: $2.704 million).
Based on management forecast of expected future taxable profits and the reversal of the temporary differences,
it is considered probable that these deferred tax assets will be recovered in the future.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
53
11. Intangible Assets
Goodwill – cost
Impairment tests for goodwill
2018
$’000
4,334
2017
$’000
4,334
Goodwill is allocated to the IAP operations as a single cash-generating unit (CGU) which is included in the
IAP business segment. The recoverable amount of the CGU is determined based on value in use calculations.
These calculations use cash flow projections based on financial budgets approved by management covering
a five-year period and include a terminal value adjusted for the perpetual growth rate.
Key assumptions used for value-in-use calculations
The calculations utilise a pre-tax risk adjusted discount rate of 14.6% (2017: 14.2%) based on the Group’s
weighted average cost of capital of 10.2% (2017: 9.9%). A perpetual growth rate beyond the forecast period
of 3% (2017: 3%) has been used. Management determined budgeted cash flows based on past performance and
Directors’ best estimates over a five-year period.
Impact of possible changes in key assumptions
The Directors consider that there is no reasonably possible change in key assumptions which management
has based its determination of IAP’s recoverable amount which would cause the carrying amount of IAP’s
CGU to exceed its recoverable amount.
12. Trade and Other Payables
Trade payables and accruals
Share subscription funds received in advance
Total trade and other payables
2018
$’000
3,271
978
4,249
2017
$’000
6,865
–
6,865
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
54
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
13. Borrowings
Current
Secured
Bank overdraft
Bank loans
Test cell loans
Lease liabilities
Non-Current
Secured
Bank loans
Test cell loans
Lease liabilities
2018
$’000
2017
$’000
–
–
1,602
12,527
174
–
–
–
1,776
12,527
12,453
3,232
1,837
273
–
261
14,563
3,493
Information concerning the effective interest rates is set out in note 25.
Bank Overdraft, Bank Loans and Bills Payable
The bank overdraft and bank loans including bills payable are secured by way of a registered company charge over
the whole of the assets and undertakings of the parent entity and that of its subsidiaries Pacific Turbine Leasing
Pty Ltd, Pacific Turbine USA Pty Ltd and IAP Group Australia Pty Ltd of $47.159 million (2017: $44.553 million).
Included in the above are bank loans and finance leases in the subsidiaries that are secured by the relevant aviation
assets included in plant and equipment and inventory of the relevant subsidiary. In addition, the Group has complied
with the requirement that, while there is money owed to the lender, no return of capital, dividends or payments can
be made to ordinary shareholders in PTB or related parties without the bank’s approval.
Lease Liabilities
Lease liabilities and finance company loans are effectively secured as the rights to the leased assets revert to the
lessor in the event of default.
Effective Interest Rates
Information concerning the effective interest rates is set out in note 25.
Finance Facilities
Information concerning available facilities including used and unused portion of the finance facilities is set out
in note 25.
Assets Pledged as Security
All assets of the Group are pledged as security for the facilities as noted above.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
55
14. Deferred Tax Liabilities
The balance comprises temporary differences attributable to:
Property, plant and equipment
Other
Total deferred tax liabilities
Movements
At 1 July 2016
Charged/(credited) to statement of profit & loss and other
comprehensive income
At 30 June 2017
Charged/(credited) to statement of profit & loss and other
comprehensive income
2018
$’000
2017
$’000
1,518
2,112
3,630
1,640
2,101
3,741
Other
Total
$’000
1,305
796
2,101
11
$’000
3,438
303
3,741
(111)
Property,
plant and
equipment
$’000
2,133
(493)
1,640
(122)
At 30 June 2018
1,518
2,112
3,630
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
56
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
15. Provisions
Current
Employee benefits
Non-Current
Employee benefits
Remediation provisions
Movements in Provisions
Balance 1 July 2016
Provisions made during the year
Provisions used during the year
Balance at 30 June 2017
Provisions made during the year
Provisions used during the year
Balance at 30 June 2018
(a) Remediation Provisions
2018
$’000
2017
$’000
735
735
98
340
438
Employee
Benefits
$’000
822
463
(454)
831
418
(416)
833
Remed
-iation
Provisions
$’000
340
–
–
340
–
–
340
741
741
90
340
430
Total
$’000
1,162
463
(454)
1,171
418
(416)
1,173
Provision is made for the estimated expenditure required to restore the leasehold premises to an acceptable
standard at the end of the lease term.
(b) Amounts not expected to be settled within the next 12 months
The current provision for employee benefits includes accrued annual leave, vesting sick leave and long
service leave. For long service leave it covers all unconditional entitlements where employees have completed the
required period of service and also those where employees are entitled to pro-rata payments in certain
circumstances. All of these amounts 2018: $298,000 (2017: $335,000) are 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.
16. Other Liabilities
Deferred revenue
Deposits in advance
Non-Current
Deferred revenue
Deferred revenue
Deferred revenue relates to maintenance contract revenue received in advance.
2018
$’000
1,473
398
1,871
2017
$’000
964
593
1,557
581
270
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
57
17. Contributed Equity
Share capital
67,311,853 ordinary shares fully paid
2018
$’000
2017
$’000
(2017: 62,749,389 ordinary shares fully paid)
42,938
40,474
Other equity securities
Value of conversion rights (net of tax)
183
183
43,121
40,657
Effective 1 July 1998, the Corporations legislation in place abolished the concepts of authorised capital and
par value shares. Accordingly, the parent does not have authorised capital nor par value in respect of its issued
shares. All shares rank equally with regards to the Company’s residual assets. The holders of ordinary shares are
entitled to one vote per share at meetings of the Company.
Movements in ordinary share capital
Closing balance 30 June 2016
Shares issued 2017
– under dividend reinvestment plan refer note 27
– under the terms of Managing Director’s engagement
– share placement
Closing balance 30 June 2017
Shares issued 2018
– under dividend reinvestment plan refer note 27
– share placements
Closing balance 30 June 2018
No. of
Shares
$’000
47,891,495
33,713
4,674,170
3,000,000
7,183,724
2,103
1,650
3,008
62,749,389
40,474
4,284,685
277,779
2,314
150
67,311,853
42,938
Note that the Group received net funds of $977,500 on 29 June 2018, which was in advance of the placement
of 1,851,852 shares on 2 July 2018. These proceeds are recorded in these accounts under payables – see note 12.
Options
As at balance date there are no outstanding options to purchase ordinary shares in the parent entity.
All options previously outstanding expired without being exercised in the year ended 30 June 2011.
An employee share option scheme was approved by shareholders on 3 June 2005. Refer to note 22 for details.
Capital Risk Management
The Group’s and the parent entity’s objectives when managing capital are to safeguard their ability to continue
as a going concern, so that they can continue to provide returns to shareholders, benefits to other stakeholders,
and to maintain an optimal capital structure to reduce the cost of capital. The group defines capital as its equity
and net debt. There has been no change to capital risk management policies during the year.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Board of
Directors monitors the return on capital, which the Group defines as net profit after tax divided by average
shareholders’ equity.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
58
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
18. Reserves
Foreign currency translation reserve
Dividend appropriation reserve
Movements in Foreign Currency Translation Reserve:
Reserve balance 1 July
Translation of controlled entity
Reserve balance 30 June
Movements in Dividend Appropriation Reserve:
Reserve balance 1 July
Transfer from retained earnings
Dividend payment
Reserve balance 30 June
2018
$’000
(7)
14,367
14,360
–
(7)
(7)
2017
$’000
–
14,262
14,262
–
–
–
14,262
3,243
13,956
2,948
(3,138)
(2,642)
14,367
14,262
The dividend appropriation reserve is used to record the retained earnings which can be used for future dividend
payments. A fully franked dividend of 5 cents per share (2017: 5 cents per share) was paid from the dividend
appropriation reserve.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
59
19. Cash Flow Information
(a) Reconciliation of Cash and Cash Equivalents
Cash and cash equivalents at the end of the financial year as shown in the statement of cash flows is reconciled
to items in the statement of financial position as follows:
Cash and cash equivalents assets – cash at bank and on hand
Bank overdraft (note 13)
2018
$’000
4,184
–
2017
$’000
2,427
–
4,184
2,427
(b) Reconciliation of Net Cash Flow from Operating Activities to Profit/(Loss) for the Year
Profit/(loss) for the year
Depreciation and amortisation
(Gain)/loss on disposal of property, plant and equipment
Movement in impairment of trade receivables
Unrealised foreign currency movements
Changes in operating assets and liabilities
(Increase)/decrease in:
Trade and other receivables
Inventories*
Deferred tax assets
Other assets
Increase/(decrease) in:
2018
$’000
3,243
1,863
–
169
(284)
3,861
(3,044)
1,541
(356)
2017
$’000
2,948
1,965
–
(826)
(657)
(7,415)
(1,459)
905
(16)
Trade payables, accruals, and other liabilities
(2,975)
1,034
Employee benefits
Current tax liabilities
Deferred tax liabilities
Net cash flow from operating activities
* net of transfers to/from property, plant and equipment.
3
–
(111)
3,910
8
–
303
(3,210)
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
60
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
20. Earnings Per Share
Basic earnings per share
Diluted earnings per share
Earnings used to calculate basic and diluted earnings per share
– Profit/(loss) after tax for the year
Weighted average number of ordinary shares used in calculating basic earnings
per share
Effect of dilutive securities:
2018
cents
5.17
5.17
2017
cents
5.66
5.66
$’000
$’000
3,243
2,948
Number
Number
62,774,389
52,117,356
Weighted average number of ordinary shares and potential ordinary shares used
in calculating diluted earnings per share
62,774,389
52,117,356
21. Key Management Personnel Disclosures
Directors
The following persons were Directors of PTB Group Limited during the financial year:
Chairman – non-executive
CL Baker
Executive Directors
SG Smith, Managing Director
Non-executive Directors
APS Kemp
RS Ferris (resigned 7th October 2017)
RQ Cole
PP Gunasekara (appointed 1st September 2017)
Other key management personnel
The following person also had authority and responsibility for planning, directing and controlling the activities of
the Group, directly or indirectly, during the financial year:
Name
D Zgrajewski
Position
Company Secretary and CFO
Employer
PTB Group Limited
Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Other long-term benefits
2018
$
2017
$
896,792
978,931
43,345
–
53,414
2,264
940,137
1,034,609
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
61
21. Key Management Personnel Disclosures (continued)
Short-term employee benefits
These amounts include fees and benefits paid to the non-executive directors as well as all salary, paid leave
benefits and fringe benefits awarded to executive directors and other KMP.
Post-employment benefits
These amounts represent superannuation contributions made during the year.
Other long-term benefits
These amounts represent long service leave benefits accrued during the year.
Further information in relation to the KMP disclosures can be found in the remuneration report contained in the
Directors’ Report.
22. Share-based Payments
Employee Share Option Scheme
The establishment of the Employee Share Option Scheme was approved by shareholders on 3 June 2005.
All staff are eligible to participate in the scheme, including executive Directors.
Options are granted under the scheme for no consideration. The exercise price will be the amount specified
by the remuneration committee at the time of issue. The exercise period is the period specified by the
remuneration committee at the time of issue. Options under the plan may not exceed 5% of the total
number of issued shares of the company at the date of issue.
Options lapse if prior to or during the exercise period the employee is terminated or resigns. If a person
dies, becomes disabled, or is made redundant prior to the exercise period the option lapses. If a person dies,
becomes disabled, or is made redundant during the exercise period special rules apply that allow options
to be exercised.
Options granted under the scheme carry no dividend or voting rights. When exercisable, each option is convertible
into one ordinary share for cash. Amounts received on the exercise of options are recognised as share capital.
There were no options granted or exercised during the financial year and no options were outstanding
at the current or prior financial year end.
23. Remuneration of Auditors
During the year the following fees were paid or payable for services provided by the auditor of the
parent entity:
Audit Services – Hall Chadwick Qld
Audit or review of the financial reports
Total remuneration for audit services
2018
$
2017
$
140,000
135,000
140,000
135,000
There was no other remuneration paid to related practices of the auditor, or other non-related audit firms.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
62
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
24. Commitments
(a) Finance leases
Commitments in relation to finance leases are payable as follows:
– Within one year
– Later than one year but not later than five years
– Later than five years
Minimum lease payments
Future finance charges
– Within one year
– Later than one year but not later than five years
– Later than five years
Representing lease liabilities:
Current
Non-current
2018
$’000
2017
$’000
12
301
–
313
(12)
(28)
–
273
–
273
273
12
298
–
310
(12)
(38)
–
260
–
260
260
Finance leases comprise an aircraft engine that is leased under commercial terms and conditions.
(b) Operating leases
Commitments in relation to non-cancellable operating leases contracted for at the reporting date but not
recognised as liabilities are payable as follows:
Within one year
Later than one year but not later than five years
Later than five years
2018
$’000
2017
$’000
195
205
–
400
191
271
–
462
Operating leases mainly comprise leases of equipment and premises (Bankstown, Sydney and Miami, Florida).
These leases are under normal commercial terms and conditions including rentals, in certain cases,
being subject to periodic review for market and/or CPI increases as well as options for renewal.
(c) Capital commitments
The Group’s commitments for capital expenditure as at 30 June 2018 were $1.050 million (2017: Nil).
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
63
25. Financial Risk Management and Other Financial Instrument Disclosures
Financial Risk Management
The Group’s activities expose it to a variety of financial risks; market risk (including foreign exchange risk, price
risk, and cash flow and fair value interest rate risk), credit risk, and liquidity risk. The Group’s overall risk
management program focuses on the unpredictability of financial markets and seeks to minimise potential
adverse effects on the financial performance of the Group.
Risk management is carried out by management under policies approved by the Board of Directors. Management
identifies, evaluates and addresses financial risks and uses different methods to measure different types of risk
to which it is exposed. These methods include sensitivity analysis in the case of interest rate, foreign exchange
and other price risks, and ageing analysis for credit risk. The Board provides principles for overall risk management,
as well as policies covering specific areas, such as mitigating foreign exchange, interest rate and credit risks, use
of derivative financial instruments and investing excess liquidity.
(a) Market risk
(i) Foreign exchange risk
Foreign exchange risk arises when future commercial transactions and recognised assets and liabilities are
denominated in a currency that is not the entity’s functional currency.
The Group operates internationally and is exposed to foreign exchange risk primarily arising from sale and
purchase transactions denominated in US dollars and UK pounds. The risk is measured using sensitivity analysis
and cash flow forecasting.
Where derivatives are used they are exclusively used for hedging purposes to minimise foreign exchange risk on
relevant transactions and the Group does not speculate on foreign currency. The Group manages this risk
through matching, to the extent possible, of US dollar denominated receivables and payables. All transactions
which are exposed to foreign exchange risk are authorised by senior management.
The Group’s exposure to foreign currency risk at the reporting date was as follows:
Cash and cash equivalents
Trade and other receivables
Inventories
Other assets
Property, plant and equipment
Trade and other payables
Borrowings
Other liabilities
Group sensitivity
30 JUN 2018
30 JUN 2017
USD
$’000
1,654
7,981
4,388
–
78
(1,757)
(6,310)
(1,014)
GBP
£’000
5
–
–
–
–
–
–
–
USD
$’000
1,330
7,510
–
17
77
(4,762)
(6,376)
(500)
GBP
£’000
7
–
–
–
–
(1)
–
–
Based on the financial instruments held at 30 June 2018, had the Australian dollar weakened/strengthened by
10% against the USD dollar, with all other variables held constant, the Group’s post tax position for the year
would have been $532,000 higher/$435,000 lower (2017: profit $275,000 lower/$225,000 higher), mainly as a
result of foreign exchange gains and losses on translation of US dollar denominated financial instruments as
detailed in the above table.
Equity would have been $532,000 higher/$435,000 lower (2017: $275,000 lower/$225,000 higher) had the
Australian dollar weakened/strengthened by 10% against the US dollar due to the reasons noted above.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
64
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
25. Financial Risk Management and Other Financial Instrument Disclosures (continued)
It is worth noting that the company undertakes the majority of its sales and purchases in US dollars.
Therefore, the majority of profit is generated in US dollars, with the reported AUD profit positively impacted
by any weakening of the Australian dollar.
As per above, the Group’s exposure to other foreign exchange movements is not material.
(ii) Price Risk
The Group is not directly exposed to material equity securities price risk or commodity price risk.
(iii) Cash flow and fair value interest rate risk
The Group has significant interest bearing liabilities, as detailed below. The majority of these liabilities bear fixed
interest rates. The fair value interest rate risk is not hedged. However, as noted above, the fixed interest rate bank
loans are generally used to fund extended credit receivables. Loans from financial institutions are used to
purchase and refurbish aviation assets. Although the fair value interest rate risk is not hedged, where possible
the loans are matched against receivables in currencies that match the interest rate risk.
Variable rate debt (primarily the bank overdraft) is also not hedged.
The Group’s exposure to interest rate risk and the effective weighted average interest rate for each class of
financial assets and financial liabilities is set out in the following table:
Fixed Interest Maturing
Floating
Interest
Rate
1 year
or less
1 to 2
years
2 to 3
years
3 to 4
years
4 to 5
years
Over 5
years
Total
Non-
interest
binding
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Effective
Weighted
Average
Interest
Rate
%
0.00%
4,179
–
5.00%
–
–
–
–
–
–
–
–
–
–
–
–
–
1,737
–
–
–
–
5
4,184
–
11,286
11,286
–
–
1,737
5.00%
–
176
546
741
779
818
396
8.00%
–
623
150
–
–
–
–
–
–
3,456
773
2018
Financial Assets
Cash and cash
equivalents
Trade and other
receivables
Loan to Related
Party
Contract
receivables
Extended credit
receivables
Total financial assets
4,179
799
696
741
2,516
818
396
11,291 21,436
Financial liabilities
Trade and other
payables
Bank overdraft
Bank Loans
Bills payable
Lease liabilities
Test cell loan
Insurance Loan
–
–
–
–
–
–
–
–
–
–
5.12% 7,645
1,491
1,486
3,330
–
4.50%
3.00%
3.79%
–
–
–
–
–
–
174
103
–
–
–
–
297
307
–
–
–
–
–
–
–
273
316
–
–
–
–
–
326
–
–
4,249
4,249
–
–
–
–
591
–
–
–
–
13,952
–
–
–
–
273
2,011
–
103
Total financial liabilities
7,645
1,768
1,783
3,637
589
326
591
4,249 20,588
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
65
25. Financial Risk Management and Other Financial Instrument Disclosures (continued)
Fixed Interest Maturing
Floating
Interest
Rate
1 year
or less
1 to 2
years
2 to 3
years
3 to 4
years
4 to 5
years
Over 5
years
Total
Non-
interest
binding
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Effective
Weighted
Average
Interest
Rate
%
2017
Financial Assets
Cash and cash
equivalents
Trade and other
receivables
Loan to
Related Party
Extended credit
receivables
0.00% 2,423
–
5.00%
8.00%
–
–
–
–
–
–
–
–
–
–
–
–
551
597
143
Total financial assets
2,423
551
597
143
Financial liabilities
Trade and
other payables
Bank overdraft
–
–
–
–
–
–
–
–
Bank Loans
5.15%
16
4,812
3,232
Bills payable
5.84% 3,450
4,188
Lease liabilities
Insurance Loan
4.50%
3.85%
–
–
–
61
–
–
–
Total financial liabilities
3,466
9,061
3,232
–
–
–
–
–
–
–
There are no other interest bearing financial assets and liabilities.
Group sensitivity
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,652
–
1,652
–
–
–
–
261
–
261
–
–
–
–
–
–
–
–
–
–
–
–
4
2,427
17,714
17,714
–
–
1,652
1,291
17,718 23,084
6,865
6,865
–
–
–
–
–
–
8,060
7,638
261
61
6,865 22,885
As the majority of the interest rates are fixed, at 30 June 2018 if interest rates had changed by -/+100 basis points
from year-end rates with all other variables held constant, post-tax profit and equity for the year would not be
materially impacted (2017: immaterial).
Net Fair Values
The net fair values of financial assets and financial liabilities approximate their carrying values.
Derivative Financial Instruments
The Group does not normally use derivative financial instruments except as noted above.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
66
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
25. Financial Risk Management and Other Financial Instrument Disclosures (continued)
(b) Credit risk
The Group trades only with recognised, creditworthy third parties.
The main credit risk arises from receivables balances. These balances are monitored on an ongoing basis
with the result that the Group’s exposure to bad debts is not considered significant by the Directors. Management
review the credit rating of each customer, taking into account any previous trading history with the Group, its
financial position, and external credit reports where appropriate. Individual risk limits are set based on internal
ratings and compliance is regularly monitored by management.
The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date
to recognised financial assets, is the carrying amount, net of any provisions for impairment of those assets,
as disclosed in the balance sheet and notes to the financial statements.
The Group does not have any material credit risk exposure to any single debtor or group of debtors under
financial instruments at balance date except as follows:
» The Group’s customers are involved in the airline passenger and freight operation industries;
» There are a number of individually significant receivables. For example, at 30 June 2018 the largest
10 debtors made up approximately 71% (2017: 70%) of total receivables. The largest debtor is a long-term
customer in the Maldives and includes trade receivables and maintenance contract receivables. This
customer accounts for 25% (2017: 34%) of total receivables.
» The receivables are concentrated in six main geographical areas. Refer to note 26 for further information.
At balance date cash was held with the Commonwealth Bank of Australia and Chase Bank.
(c) Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding
through an adequate amount of committed credit facilities. The Group manages liquidity risk by continuously
monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities.
The Group also ensures that adequate unutilised borrowing facilities and cash reserves are maintained.
The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use
of bank overdrafts, bank loans, unsecured notes, finance leases and finance company loans.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
67
25. Financial Risk Management and Other Financial Instrument Disclosures (continued)
Finance Facilities
Available facilities
Bank overdraft
Bank Loans – chattel mortgage
– other
Bills payable – multi option
Finance Company Leases & Loans
Test cell loan
Related party facilities
Amounts utilised
Bank overdraft
Bank Loans – chattel mortgage
– other
Bills payable – multi option
Finance Company Leases & Loans
Test cell loan
Related party facilities
Unused facilities
Bank overdraft
Bank Loans – other
Test cell loan
Consolidated
2018
$’000
2017
$’000
682
–
14,193
–
273
3,374
–
653
–
8,218
7,638
261
–
–
18,522
16,770
–
–
14,055
–
273
2,011
–
–
–
8,121
7,638
261
–
–
16,339
16,020
682
138
1,363
2,183
653
97
–
750
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
68
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
25. Financial Risk Management and Other Financial Instrument Disclosures (continued)
Maturities of financial liabilities
The tables below analyse the Group’s financial liabilities and net and gross settled derivative financial instruments
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.
1 year
or less
$’000
1 to 2
years
$’000
2 to 3
years
$’000
3 to 4
years
$’000
4 to 5
years
$’000
Over 5
years
$’000
Total
$’000
Group 2018
Non-derivatives
Non-interest
bearing
Variable rate
Fixed rate
Total financial
liabilities
Group 2017
Non-derivatives
Non-interest
bearing
Variable rate
Fixed rate
Total financial
liabilities
Bank overdraft
4,249
–
7
1,769
6,025
7,638
1,783
9,421
–
–
3,636
3,636
6,865
3,466
9,061
19,392
–
–
3,232
3,232
–
–
–
–
–
–
589
589
–
–
–
–
–
–
326
326
–
–
261
261
–
–
591
591
–
–
–
–
4,249
7,645
8,694
20,588
6,865
3,466
12,554
22,885
The bank overdraft facilities are subject to annual review and may be drawn at any time. The interest rate is
variable and is based on prevailing market rates.
Bank loans
The chattel mortgage loans are repayable by monthly instalments of principal and interest over a period of 2 to
4 years from each draw down date.
Maturities of financial liabilities
The previous tables analyse the Group’s financial liabilities, net and gross settled derivative financial instruments
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.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
69
26. Segment Information
The Group has four reportable segments:
» PTB: Covering the operations of the holding company PTB Group Limited specialising in PT6 and
TPE331 Turboprop engines. The business repairs and sells PT6 and TPE331 engines, maintains related
engines under contract, and trades in related engine and airframe parts.
» PT USA: This covers the operations of Pacific Turbine USA, LLC and Pacific Turbine USA Pty Ltd specialising
in PT6 Turboprop engines. The business repairs and sells PT6 engines, maintains related engines under
contract and trades in related engine parts.
» PT Leasing: Covers the operation of Pacific Turbine Leasing Pty Ltd (formerly named PTB (Emerald)
Pty Ltd). This business is an aircraft and engine owner and leases aircraft and engines to operators
under both operating and finance leases.
»
IAP: Covering the operations of the IAP Group Australia Pty Ltd trading in aircraft, jet aircraft engines,
airframes and related parts.
Geographical Segments (Secondary Reporting)
The Group’s management and operations are based in Brisbane and Sydney, Australia. The company also
operates a facility in Miami, Florida USA. Its customers, however, are located in six main geographical
markets – Australia/PNG/New Zealand, Pacific Islands, America, Asia, Africa, and Europe.
Segment assets include rental engines and aircraft which are attributed either to the geographic market in which
the customer who rents the engine or aircraft at year-end is based or, for non-rented engines and aircraft, where
they are physically located.
The following tables outline the distribution of the Group’s sales, adjusted EBITDA, assets and liabilities by those
geographical markets by business segment.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES 70
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
26. Segment Information (continued)
2018
i) Revenue
PTB
Total Segment
Revenue
Inter-segment
Revenue
Revenue from
External customers
PT USA
Total Segment
Revenue
Inter-segment
Revenue
Revenue from
External customers
PT Leasing
Total Segment
Revenue
Inter-segment
Revenue
Revenue from
External customers
IAP
Total Segment
Revenue
Inter-segment
Revenue
Revenue from
external customers
Unallocated
Total Unallocated
Revenue
Total Revenue from
External Customers
AUS,
PNG
& NZ
$’000
Pacific
$’000
America
North &
South
$’000
Asia
Africa
Europe
Unallo
-cated
Total
$’000
$’000
$’000
$’000
$’000
7,915
5,279
1,846
13,089
58
552
(913)
–
(1,250)
–
–
–
7,002
5,279
596
13,089
58
552
4,260
(4,232)
28
2,556
(945)
1,611
–
–
–
91
–
91
2,700
1,279
–
–
2,700
1,279
45
747
–
–
45
747
1,971
37
2,259
3,033
(661)
–
(54)
–
1,310
37
2,205
3,033
–
–
–
36
–
36
72
–
72
69
–
69
–
–
–
772
–
772
–
–
–
–
–
–
9,951
5,407
5,546
18,148
166
1,393
–
–
–
–
–
–
–
–
–
–
–
–
–
–
28,739
(2,163)
26,576
8,308
(4,232)
4,076
3,475
(945)
2,530
8,144
(715)
7,429
–
40,611
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
71
26. Segment Information (continued)
2018
AUS,
PNG
& NZ
$’000
Pacific
$’000
America
North &
South
$’000
Asia
Africa
Europe
Unallo
-cated
Total
$’000
$’000
$’000
$’000
$’000
ii) Adjusted EBITDA
PTB
PT USA
PT Leasing
IAP
Unallocated
931
–
1,391
302
–
647
–
81
8
–
73
(17)
39
480
–
1,605
1
659
661
–
Adjusted EBITDA
2,624
736
575
2,926
iii) Segment Disclosure Items
Depreciation &
Amortisation
PTB
PT USA
PT Leasing
IAP
Total
Unrealised (Gain)/
Loss on Foreign
Currency
PTB
PT USA
PT Leasing
IAP
Total
174
–
920
66
1,160
–
–
–
–
–
–
–
20
–
20
(55)
–
2
–
(53)
–
27
38
–
65
(7)
(19)
1
(28)
(53)
–
–
615
–
615
(135)
–
13
(39)
(161)
7
–
32
16
–
55
–
–
3
–
3
(1)
–
1
(1)
(1)
68
–
–
168
–
236
–
–
–
–
–
(6)
–
–
(10)
(16)
–
–
–
–
–
-
–
–
–
–
–
–
–
–
–
–
3,331
(16)
2,202
1,635
–
7,152
174
27
1,596
66
1,863
(204)
(19)
17
(78)
(284)
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
72
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
26. Segment Information (continued)
Pacific
$’000
America
North &
South
$’000
Asia
Africa
Europe
Unallo
-cated
Total
$’000
$’000
$’000
$’000
$’000
2018
Capital Expenditure
PTB
PT USA
PT Leasing
IAP
Total
AUS,
PNG
& NZ
$’000
2,147
–
231
24
2,402
–
–
–
–
–
–
30
–
–
30
–
–
–
–
–
49,940
2,777
8,327
10,919
574
Total Segment Assets
PTB
PT USA
30,463
2,372
206
5,257
1
–
7,222
957
PT Leasing
7,793
404
11,683
–
1
–
383
516
–
3,201
1,504
–
IAP
Unallocated
Total
Total assets includes:
Non-current Assets (other than financial assets and deferred tax)
PTB
PT USA
PT Leasing
IAP
Total
11,945
1,173
–
3,450
–
7,009
6,285
–
396
–
107
352
–
–
2,447
–
25,239
1,569
459
5,897
Total Segment Liabilities
PTB
PT USA
PT Leasing
IAP
Total
2,284
723
–
262
884
–
–
1
857
962
–
87
126
–
1,214
153
3,430
724
1,906
1,493
121
–
–
–
–
–
19
307
238
10
–
–
–
231
–
231
113
–
8
–
–
–
–
–
–
–
–
–
–
–
2,147
30
231
24
2,432
71
21,167
59,555
–
–
78
–
149
(7,080)
1,407
(13,250)
(1,231)
(837)
12,955
–
–
–
72,686
–
–
–
–
–
18
11
–
171
200
21,167
37,735
(7,080)
(6,973)
(13,250)
(2,815)
(837)
5,448
–
–
–
–
–
–
33,395
4,121
973
1,484
1,296
7,874
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
73
26. Segment Information (continued)
2017
i) Revenue
PTB
Total Segment
Revenue
Inter-segment
Revenue
Revenue from
External customers
PT USA
Total Segment
Revenue
Inter-segment
Revenue
Revenue from
External customers
PT Leasing
Total Segment
Revenue
Inter-segment
Revenue
Revenue from
External customers
IAP
Total Segment
Revenue
Inter-segment
Revenue
Revenue from
external customers
Unallocated
Total Unallocated
Revenue
Total Revenue from
External Customers
AUS,
PNG
& NZ
$’000
Pacific
$’000
America
North &
South
$’000
Asia
Africa
Europe
Unallo
-cated
Total
$’000
$’000
$’000
$’000
$’000
9,506
3,612
1,950
18,979
(2,304)
–
–
–
7,202
3,612
1,950
18,979
1
–
1
3,584
(3,017)
567
–
–
–
1,290
1,137
1,120
–
–
–
1,290
1,137
1,120
1,816
429
96
840
(330)
–
–
–
1,486
429
96
840
3
–
3
276
–
276
2
–
2
33
–
33
1,905
131
2,091
2,995
233
949
(776)
–
–
–
–
–
1,129
131
2,091
2,995
233
949
–
–
–
–
–
–
10,384
4,172
5,427
23,951
1,357
1,260
–
–
–
–
–
–
–
–
–
–
–
–
–
–
34,324
(2,304)
32,020
7,133
(3,017)
4,116
3,217
(330)
2,887
8,304
(776)
7,528
–
46,551
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
74
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
26. Segment Information (continued)
2017
AUS,
PNG
& NZ
$’000
Pacific
$’000
America
North &
South
$’000
Asia
Africa
Europe
Unallo
-cated
Total
$’000
$’000
$’000
$’000
$’000
ii) Adjusted EBITDA
PTB
PT USA
PT Leasing
IAP
Unallocated
418
96
1,362
278
–
189
–
309
32
–
102
140
69
508
–
995
123
603
728
–
–
121
2
57
–
Adjusted EBITDA
2,154
530
819
2,449
180
(iii) Segment Disclosure Items
Depreciation &
Amortisation
PTB
PT USA
PT Leasing
IAP
Total
Unrealised (Gain)/
Loss on Foreign
Currency
PTB
PT USA
PT Leasing
IAP
Total
185
–
1,038
67
1,290
–
–
–
–
–
–
–
95
–
95
(19)
–
(85)
(1)
–
3
–
–
3
–
–
577
–
577
(11)
(79)
(19)
(9)
(104)
(70)
(165)
(13)
–
–
–
–
–
–
(68)
(1)
(1)
(105)
(118)
(352)
(70)
(12)
14
–
24
231
–
269
–
–
–
–
–
(2)
–
(6)
(4)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,718
480
2,369
1,834
–
6,401
185
3
1,710
67
1,965
(136)
(217)
(276)
(28)
(657)
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
75
26. Segment Information (continued)
Pacific
$’000
America
North &
South
$’000
Asia
Africa
Europe
Unallo
-cated
Total
$’000
$’000
$’000
$’000
$’000
2017
Capital Expenditure
PTB
PT USA
PT Leasing
IAP
Total
Total Segment Assets
AUS,
PNG
& NZ
$’000
74
–
628
718
1,420
–
–
–
–
–
–
103
–
–
103
–
–
–
–
–
–
–
–
–
–
62
294
236
13
–
–
–
–
–
–
–
–
–
–
–
74
103
628
718
1,523
186
20,709
58,122
2
3
6
–
(629)
5,691
(14,928)
(1,994)
(5,152)
8,545
–
–
–
70,364
20,709
30,822
(629)
(528)
(14,928)
(3,517)
(5,152)
941
–
–
–
–
–
–
27,718
6,497
1,432
614
1,320
9,863
PTB
PT USA
PT Leasing
IAP
Unallocated
Total
26,558
1,523
682
8,402
648
8,047
10,963
–
–
4,913
463
423
73
–
–
4,225
505
2,137
–
–
46,216
2,019
6,100
15,227
605
197
Total assets includes:
Non-current Assets (other than financial assets and deferred tax)
PTB
PT USA
PT Leasing
IAP
Total
10,036
–
7,258
6,093
23,387
77
–
416
–
493
–
101
–
–
–
–
3,503
–
101
3,503
Total Segment Liabilities
PTB
PT USA
PT Leasing
IAP
Total
2,142
443
27
230
726
–
–
1
3,739
1,307
–
175
3,125
444
5,221
91
98
376
304
869
–
–
234
–
234
75
–
8
–
83
–
–
–
–
–
7
–
–
114
121
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
76
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
26. Segment Information (continued)
Other segment information
(i) Segment revenue
Sales between segments are carried out at cost and are eliminated on consolidation. The revenue from external
parties reported to the Board is measured in a manner consistent with that in the income statement.
Revenues from external customers of PTB and PT USA are derived from repairing, selling, and maintaining PT6
and TPE331 turbo prop aircraft engines under contract and trading in related engine and airframe parts. For IAP,
revenue is derived from trading in aircraft, jet aircraft engines, airframes and related parts. PT Leasing’s revenue
is interest income from finance leases and revenue from operating leases and sale of aircraft.
A breakdown of revenue and results is provided in the preceding tables.
Total Segment revenue
Intersegment eliminations
Interest revenue
Total revenue from continuing operations (note 2)
2018
$’000
2017
$’000
48,666
52,978
(8,055)
(6,427)
–
–
40,611
46,551
The Group is predominantly domiciled in Australia. The amount of its revenue from external customers in
Australia is $9.951 million (2017: $10.384 million) and the total revenue from external customers in other countries
is $30.660 million (2017: $36.167 million). Segment revenues are allocated based on the country in which the
customer is located.
(ii) Adjusted EBITDA
The Board assesses the performance of the operating segments based on a measure of adjusted EBITDA.
This measurement basis excludes the effects of non recurring expenditure from the operating segments such
as, unrealised gains/(losses) on foreign currency movements, impairments of aircraft, inventory and extended
credit receivables. Interest income and interest income on long term HP receivables is allocated to segments
whereas finance costs and depreciation and amortisation expenses are not allocated to segments.
A reconciliation of adjusted EBITDA to operating profit before income tax is provided as follows:
Adjusted EBITDA
Unrealised gain/(loss) on foreign Currency
Depreciation and amortisation
Finance Costs
Profit/(Loss) before income tax from continuing operations
2018
$’000
7,152
284
(1,863)
(899)
4,674
2017
$’000
6,401
657
(1,965)
(936)
4,157
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
77
26. Segment Information (continued)
(iii) Segment assets
The amounts provided to the Board with respect to total assets are measured in a manner consistent with that
of the financial statements. These assets are allocated based on the operations of the segment and the physical
location of the asset.
Reportable segments’ assets are reconciled to total assets as follows:
Segment Assets
Unallocated:
Deferred tax assets
Total assets as per the statement of financial position
2018
$’000
2017
$’000
72,686
70,364
2,472
75,158
4,013
74,377
The total of non current assets other than financial instruments and deferred tax assets located in Australia
is $25.239 million (2017: $23.387 million), and the total of these non current assets located in other countries is
$8.156 million (2017: $4.331 million). Segment assets are allocated to countries based on where the
assets are located.
(iv) Segment liabilities
The amounts provided to the board with respect to total liabilities are measured in a manner consistent with that
of the financial statements. These liabilities are allocated based on the operations of the segment.
The group’s borrowings and derivative financial instruments are not considered to be segment liabilities
but rather managed by the treasury function. Reportable segments’ liabilities are reconciled to total liabilities
as follows:
Segment Liabilities
Unallocated:
Deferred tax liabilities
Current borrowings
Non-current borrowings
Total liabilities as per the statement of financial position
2018
$’000
7,874
3,630
1,776
14,563
27,843
2017
$’000
9,863
3,741
12,527
3,493
29,624
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
78
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
27. Dividends
Dividends paid during the year
Interim dividend for 30 June 2018 of 5 cents per share
(2017: 5 cents per share) fully franked (at 30%) paid on 29 June 2018
2018
$’000
3,138
2017
$’000
2,642
Dividends paid in cash or satisfied by the issue of shares under dividend reinvestment scheme during the
year were as follows:
Paid in cash
Satisfied by the issue of shares
Franking credits
Franking credits available for subsequent financial
years based on a tax rate of 30% (2017: 30%)
2018
$’000
824
2,314
3,138
2017
$’000
539
2,103
2,642
Consolidated
Parent Entity
2018
$’000
2017
$’000
2018
$’000
2017
$’000
6,859
8,204
6,859
8,204
The above amounts represent the balance of the franking account as at the end of the financial year,
adjusted for:
a) franking credits that will arise from the payment of the amount of the provision for income tax;
b) franking debits that will arise from the payment of dividends recognised as a liability at the reporting date;
and
c) franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date.
The consolidated amounts include franking credits that would be available to the parent entity if distributable
profits of subsidiaries were paid as dividends.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
79
28. Subsidiaries
Name
Country of Incorporation
2018
Equity Holding
100%
100%
100%
100%
100%
100%
100%
100%
100%
PTB Finance Limited (1)
Pacific Turbine USA Pty Ltd (1)(8)
Pacific Turbine, Inc (2)
Pacific Turbine Leasing Pty Ltd (3)
IAP Group Australia Pty Ltd (4)
Australia
Australia
USA
Australia
Australia
International Air Parts UK Limited (5)
United Kingdom
PTB Emerald Limited (6)
748 Cargo Pty Ltd (7)
Pacific Turbine USA, LLC (9)
(1) Incorporated 14 October 2005
(2) Incorporated 29 September 2005
United Kingdom
Australia
USA
(3) Incorporated 4 October 2006 (previously PTB (Emerald) Pty Ltd)
(4) Purchased as part of business combination on 21 September 2006
Aeropelican Air Services disposed on 30 September 2008
(5) Incorporated 18 October 2006
(6) Incorporated 13 October 2006
(7) Incorporated 21 June 2007 (Previously PTB Asset Management Pty Ltd)
(8) Change of name on 1 February 2016 (Previously PTB Rentals Australia Pty Ltd)
(9) Incorporated 27 March 2017
2017
100%
100%
100%
100%
100%
100%
100%
100%
100%
All subsidiaries are 100% owned by PTB Group Limited. All share capital consists of ordinary shares in
each company and the proportion of ownership interest is equal to the proportion of voting power held. All
subsidiaries were established by the parent except for those acquired as part of the business combination
in prior years.
There are no significant restrictions over the Group’s ability to access these assets, and settle liabilities,
of the Group.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
80
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
29. Deed of Cross Guarantee
On 29 June 2007, PTB Group Limited and all of its subsidiaries, excluding PTB Finance Limited and
Pacific Turbine Inc, entered into an arrangement as parties to a deed of cross guarantee under which each
company guarantees the debts of the others. By entering into the deed, the wholly owned entities have
been relieved from the requirements to prepare a financial report and Directors’ Report under Class Order
98/1418 (as amended) issued by the Australian Securities and Investments Commission.
(a) Consolidated statement of profit & loss and other comprehensive income and summary of
movements in consolidated retained earnings
PTB Group Limited and its subsidiaries, excluding PTB Finance Limited and Pacific Turbine Inc, represent a
‘Closed Group’ for the purposes of the Class Order, and as there are no other parties to the Deed of Cross
Guarantee that are controlled by PTB Group Limited, they also represent the ‘Extended Closed Group’.
Set out below is a consolidated statement of profit & loss and other comprehensive income and a summary
of movements in consolidated retained profits for the year ended 30 June 2018 of the Closed Group:
Revenue
Total Revenue
2018
$’000
40,611
40,611
2017
$’000
46,551
46,551
Changes in inventories of finished goods and work in progress
2,166
797
Raw materials and consumables used and finished goods purchased for sale
(25,419)
(31,568)
Employee benefits expense
Depreciation and amortisation
Repairs and maintenance
Bad and doubtful debts
Finance costs
Net foreign exchange gain/(loss)
Net gain/(loss) on sale of property, plant and equipment
Other expenses
Total expenses
Profit/(Loss) before income tax expense
Income tax expense
Profit/(Loss) for the year
Statement of Comprehensive Income Profit/(Loss) for the year
Other comprehensive income net of tax
Total comprehensive income for the year attributable to the
owners of the parent entity
Summary of movements in consolidated retained profits/(losses)
Retained (losses)/profits at the beginning of the financial year
Transfer to dividend appropriation reserve
Profit/(loss) for the year
Retained (losses)/profits at the end of the financial year
(5,803)
(1,863)
(154)
(175)
(899)
246
–
(5,674)
(1,965)
(80)
808
(936)
42
–
(4,036)
(3,818)
(35,937)
(42,394)
4,674
(1,431)
3,243
3,243
(7)
4,157
(1,209)
2,948
2,948
–
3,236
2,948
(10,292)
(10,292)
(3,243)
(2,948)
3,243
2,948
(10,292)
(10,292)
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
81
29. Deed of Cross Guarantee (continued)
(b) Consolidated Statement of Financial Position
Set out below is a consolidated statement of financial position as at 30 June 2018 of the Closed Group:
Current Assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other current assets
Total Current Assets
Non-Current Assets
Trade and other receivables
Inventories
Other financial assets
Property, plant and equipment
Deferred tax assets
Intangible assets
Other non-current assets
Total Non-Current Assets
Total Assets
Current Liabilities
Trade and other payables
Borrowings
Current tax liabilities
Provisions
Other current liabilities
Total Current Liabilities
Non Current Liabilities
Borrowings
Deferred tax liabilities
Provisions
Other non-current liabilities
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Contributed equity
Reserves
Retained earnings
Total Equity
2018
$’000
2017
$’000
4,184
10,119
24,403
585
2,427
17,753
22,237
229
39,291
42,646
6,819
2,543
265
19,385
2,472
4,334
–
35,818
75,109
4,249
1,776
–
735
1,871
8,631
14,563
3,630
438
581
19,212
27,843
47,266
43,198
14,360
2,590
2,309
265
18,171
4,013
4,334
–
31,682
74,328
6,865
12,527
–
741
1,557
21,690
3,493
3,741
430
270
7,934
29,624
44,704
40,734
14,262
(10,292)
(10,292)
47,266
44,704
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
82
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
30. Related Party Balances and Transactions
a) Parent entity and subsidiaries
The ultimate parent entity of the Group is PTB Group Limited. Interests in subsidiaries are set out in note 28.
b) Key management personnel
Disclosures relating to key management personnel are set out in the Directors’ Report and note 21.
c) Other Transactions with Subsidiaries
The following transactions occurred with subsidiaries:
Revenue – sale of engines
Revenue – sale of goods and services
Purchase – engines
Purchase – goods and services
Purchase – engine rentals
Parent Entity
2018
$’000
2017
$’000
1,562,055
891,593
600,775
1,412,870
1,697,193
3,143,562
2,516,871
502,849
57,921
–
In addition to the above sales, the parent has also provided, free of charge, other administrative and accounting
assistance to the subsidiaries.
d) Outstanding balances of Loans to Subsidiaries
Loans to subsidiaries
Parent Entity
2018
$’000
2017
$’000
20,850,534
20,393,687
The loans are non-interest bearing, unsecured, at call and repayable in cash.
e) Outstanding balances arising from sales/purchases of goods and services
Trade and extended credit receivables
Trade payables
Parent Entity
2018
$’000
2017
$’000
–
–
–
–
No provisions for doubtful debts have been raised in relation to any outstanding balances, and no expense has
been recognised in respect of bad or doubtful debts due from related parties.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2018
83
31. Parent Entity Financial Information
a) Summary financial information
Statement of Financial Position
Current assets
Total Assets
Current liabilities
Total Liabilities
Shareholders’ equity
Issued Capital
Reserves
Retained earnings
Profit / (loss) for the year
Total comprehensive income
b) Guarantees entered into by the parent entity
Carrying amount included in current liabilities
32. Events after the Balance Date
2018
$’000
2017
$’000
21,819
70,412
4,648
16,025
43,198
14,367
(3,178)
27,300
69,821
13,976
16,337
40,734
12,596
154
54,387
53,484
1,577
1,577
(97)
(97)
2018
$’000
–
2017
$’000
–
No matters or circumstances have arisen since the end of the financial year which have 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 future years.
33. Contingent liabilities
The Group had the following bank guarantees as at 30 June:
Favouree
Bank
Date
Bankstown Airport Limited
CBA
27/03/2007
2018
$’000
2017
$’000
18
18
18
18
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
84
DIRECTORS’ DECLARATION
For the year ended 30 June 2018
The Directors of the Company declare that:
(a) the attached financial statements and notes, as set out on pages 30 to 83 are in accordance with the
Corporations Act 2001 and:
(i) comply with Australian Accounting Standards and the Corporations Regulations 2001; and
(ii) give a true and fair view of the financial position as at 30 June 2018 and of the performance for the
year ended on that date of the consolidated entity;
(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 29 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 29; and
(d) the financial statements also comply with International Financial Reporting Standards as disclosed
in note 1.
The Directors have been given the declarations by the Managing Director and Chief Financial Officer
for the financial year ended 30 June 2018 required by section 295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of the Directors.
CL Baker
Chairman
Brisbane
29 August 2018
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018 INDEPENDENT AUDITOR’S REPORT
For the year ended 30 June 2018
85
INDEPENDENT AUDITOR’S REPORT – TO THE MEMBERS OF PTB GROUP LIMITED
wpca.com.au
Report on the Audit of the Financial Report
Opinion
We have audited the accompanying financial report of PTB Group Ltd and Controlled Entities (the
Group), which comprises the consolidated statement of financial position as at 30 June 2018, the
consolidated statement of profit or loss and other comprehensive income, the consolidated
statement of changes in equity, the consolidated statement of cash flows for the year ended and
notes comprising a summary of significant accounting policies and other explanatory information,
and the directors’ declaration.
In our opinion:
(a)
the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
(i) giving a true and fair view of the Group’s financial position as at 30 June 2018 and of its
financial performance for the year then ended; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
(b)
the financial report also complies with International Financial Reporting Standards as disclosed
in Note 1.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities
under those standards are further described in the Auditor’s Responsibilities section of our report. We
are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are
relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical
responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has
been given to the directors of the company, would be in the same terms if given to the directors as
at the time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Limited Liability by a scheme approved
under the Professional Standards Legislation
National Association | Hall Chadwick
International Association | Prime Global
Associations of Independent Firms
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
86
INDEPENDENT AUDITOR’S REPORT
For the year ended 30 June 2018
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report for the year ended 30 June 2018. These matters were addressed in
the context of our audit of the financial report as a whole, and in forming our opinion thereon, and
we do not provide a separate opinion on these matters.
Key Audit Matter
Value of Goodwill
How our audit addressed the key audit matter
Our procedures included, amongst others:
Refer to Note 1 (q), Note 11 and Note 1 (ad) –
Intangible Assets
recognised
The value of goodwill
the
acquisition of International Air Parts (IAP) has
been considered as a key audit matter.
Conditions giving rise to our focus on this area
included the significant level of judgement in
respect of factors such as:
for
Evaluation of management’s goodwill
impairment assessment process and
testing controls such as the review of
forecasts by management.
Obtaining the Group’s value
in use
models and agreeing amounts to the
Group’s FY18 budget.
budgeted future revenue and costs;
discount rates; and
the terminal growth rate
Testing key inputs to the value in use
model included forecast revenue, costs,
capital expenditure, discount rates and
terminal growth rates. We challenged
these inputs by corroborating the key
market based assumptions to external
published
rates and
industry growth
industry reports. For non-market based
assumptions we corroborated
those
assumptions by comparing forecasts to
historical costs incurred or margins on
similar projects. We also assessed the
inclusion of
revenue
contracts by comparing the margins in
the
to historical
contract margins.
impairment model
key ongoing
Assessment of the accuracy of previous
forecasts as part of our evaluation of
forecasts included in the value in use
model. We applied scepticism to current
period forecasts in areas where previous
forecasts were not achieved and/or
where future uncertainty is greater or
volatility is expected.
the
Performing sensitivity analysis on
Cash Generating Unit (CGU) in two main
areas being the discount rate and the
terminal growth rate assumptions.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
INDEPENDENT AUDITOR’S REPORT
For the year ended 30 June 2018
87
Key Audit Matter
How our audit addressed the key audit matter
Carrying value and existence of aviation assets
Our procedures included, amongst others:
Refer to Note 1 (p) and Note 9 – Property Plant
and Equipment
We considered the potential impairment of idle
or parked aviation assets as a key audit matter
due to the size of the asset base, and because
the Group’s internal assessment of the fair value
less costs to sell involves judgements about the
future results generated from these assets and
the discount rates applied to future cash flow
forecasts.
PTB have provided evidence of the carrying
value of
the aircraft by conducting NRV
calculations. This involved calculating the cost
to bring each asset into use and identifying the
cash flows arising from use, before discounting
these cash flows. There are two elements to the
cash flow generated by these assets – rental of
the engine, and
the
maintenance.
the margin on
Evaluation of each asset’s cash
flow
forecasts and the process by which they
including considering
were developed,
the
the mathematical accuracy of
also
underlying
compared
rental
to
agreements and found that the metrics
used were consistently applied.
calculations. We
latest
them
the
Comparison of current year actual results
with the figures included in the prior year
forecast to consider whether any forecasts
included assumptions that, with hindsight,
had been optimistic. We found that the
actual performance was materially
consistent with forecast performance.
Verified existence of
idle and parked
aviation assets as at 30 June 2018 and
gave consideration
their physical
condition.
to
We also challenged:
the Group’s key assumptions
the discount rate used in the model
Inventory Valuation & Existence
Our procedures included, amongst others:
Refer to Note 1 (m) and Note 6 – Inventories
The Group recognised inventory of $27 million at
30 June 2018. We focussed on this matter
because of the:
significance of the inventory balance to the
profit and statement of financial position;
and
slow moving nature of some major stock
items due to the fragmented landscape of
the aviation spare parts industry.
Attending inventory counts at all locations
and performed the following procedures
at each site:
- Selected a sample of inventory items
the quantities we
and comparing
counted to the quantities recorded.
- Observed a sample of management’s
inventory count procedures to assess
compliance with the Group’s inventory
policy.
- Made enquiries
inventory
condition of items counted.
items and
regarding obsolete
looked at the
A sample of inventory items was tested to
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
88
INDEPENDENT AUDITOR’S REPORT
For the year ended 30 June 2018
Key Audit Matter
How our audit addressed the key audit matter
assess whether they were recorded lower
of cost or net realisable value. Procedures
performed included the following:
- Evaluated
the methods used by
management in the costing of finished
goods.
- Selected a sample of inventory items
and performing the following:
to
- comparing cost
sales prices
realised subsequent to period end by
checking sales invoices, price lists
and contracts; and
- where cost was greater than net
realisable value, considered whether
a write down was required.
Information Other Than the Financial Report and Auditor’s Report Thereon
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2018, but does not include the
financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If,
based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Director’s Responsibility for the Financial Report
The directors of the company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act
2001 and for such internal control as the directors determine is necessary to enable the preparation
of the financial report that gives a true and fair view and is free from material misstatement, whether
due to fraud or error. In note 1, the directors also state, in accordance with Australian Accounting
Standards AASB 101 Presentation of Financial Statements, that the financial report complies with
International Financial Reporting Standards.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors either intend to liquidate the Group or to
cease operations, or have no realistic alternative but to do so.
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
INDEPENDENT AUDITOR’S REPORT
For the year ended 30 June 2018
89
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with the Australian Auditing Standards will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud of error, design and perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of
not detecting a material misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or
the override of internal controls.
Obtain an understanding of internal controls relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Group’s internal controls.
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant doubt on the Group’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the financial
report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our auditor’s report. However,
future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and
events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the
entities or business activities within the Group to express an opinion on the financial report.
We are responsible for the direction, supervision and performance of the Group audit. We
remain solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
90
INDEPENDENT AUDITOR’S REPORT
For the year ended 30 June 2018
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on the Remuneration Report
We have audited the remuneration report included in pages 9 to 15 of the directors’ report for the
year ended 30 June 2018.
The directors of the company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
Opinion
In our opinion the remuneration report of PTB Group Limited for the year ended 30 June 2018
complies with s 300A of the Corporations Act 2001.
Geoffrey Stephens
Hall Chadwick Qld
Chartered Accountants
Dated this 29th day of August 2018
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
SHAREHOLDERS INFORMATION
For the year ended 30 June 2018
91
The shareholder information set out below was applicable as at 3 August 2018.
(a) Distribution of Shareholders:
Category (size of Holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Class of equity security
Ordinary
Shares
Options
53
183
121
342
87
786
–
–
–
–
–
–
(b) The number of ordinary shareholdings held in less than marketable parcels is 28.
(c) The names of the substantial shareholders (including related entities) listed in the company’s register are:
Asir & Nek Private Limited
SG Smith and Judith Flintoft
(d) Voting Rights
Number of
Ordinary
Shares
Held
12,294,666
5,992,635
Percentage
17.78%
8.66%
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a
poll each share shall have one vote. Options carry no voting rights.
ANNUAL REPORT 2018 | PTB GROUP LIMITED AND CONTROLLED ENTITIES
92
SHAREHOLDERS INFORMATION
For the year ended 30 June 2018
(e) 20 Largest Shareholders – Ordinary Shares (Quoted):
ASIR & NEK PRIVATE LIMITED
JUDITH ANN MARGARET FLINTOFT
MR ROYSTON STEPHEN FERRIS
HUGH JONES
PRINCE PRIYANTHA GUNASEKARA
J P MORGAN NOMINEES AUSTRALIA LIMITED
BAKER SUPERANNUATION PTY LTD
MILTON YANNIS
MR STEPHEN GARRY SMITH & MRS JUDITH ANN FLINTOFT
ROSS GEORGE YANNIS
BARRIJAG PTY LIMITED
DR DAVID JOHN RITCHIE & DR GILLIAN JOAN RITCHIE
MARGARET HILLS
EST GEORGE YANNIS & MRS THELMA YANNIS
JUDITH FLINTOFT
GRAEME HILLS
COSELL PTY LIMITED
LORNETTE PTY LTD
HUXLEY MARTIN PTY LTD
STANBOX PTY LIMITED
Unquoted equity securities
Options issued under the PTB Group Ltd Share Option Scheme
to take up ordinary shares
Percentage
Number of
Ordinary
Fully Paid
Shares
Held
12,294,666
17.78%
3,277,778
2,878,435
2,672,218
2,443,282
2,398,579
2,226,115
2,105,524
1,826,857
1,540,590
1,000,000
1,000,000
941,195
891,294
888,000
834,093
600,000
567,388
503,645
500,000
4.74%
4.16%
3.86%
3.53%
3.47%
3.22%
3.04%
2.64%
2.23%
1.45%
1.45%
1.36%
1.29%
1.28%
1.21%
0.87%
0.82%
0.73%
0.72%
41,389,659
59.84%
Number
on issue
Number
of holders
–
–
PTB GROUP LIMITED AND CONTROLLED ENTITIES | ANNUAL REPORT 2018
COMPANY STATISTICS
For the year ended 30 June 2018
Revenue ($’000)
+-Net profit/(loss) ($’000)
2018
40,611
3,243
2017
46,551
2,948
2016
2015
2014
43,170
35,996
34,732
2,567
1,963
35,101
1,183
(11,137)
33,556
3,215
Net Assets ($’000)
47,315
44,753
37,686
Cash Flow from
Operating Activities ($’000)
3,910
(3,210)
1,671
Ordinary Shares fully paid (‘000)
67,312
62,749
47,891
42,008
36,582
Return on average
shareholders’ funds (%)
7.04
7.38
7.21
4.92
(28.47)
Share price at year-end ($)
0.56
0.485
0.42
0.30
NTA backing per Share (Cents)
Dividend paid (Cents) per share in
respect of each financial year
64
5
64
5
70
5
73
5
0.29
80
Nil
Average AUD/USD exchange rate
$0.76
$0.79
$0.73
$0.84
$0.92
A
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P
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2
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|
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ABN 99 098 390 991
PO Box 90 PINKENA QLD 4008
22 Orient Avenue PINKENBA QLD 4008
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