:contents
Executive Chairman’s & CEO’s letter
Directors' Report
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Introduction
Remuneration governance
Executive remuneration arrangements
Executive remuneration outcomes for FY23
Executive contractual arrangements
Non-executive Director remuneration arrangements
Share based compensation
Other statutory disclosures
Auditor’s Independence Declaration to the Directors of ReNu Energy Limited
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Cash Flows
Consolidated Statement of Changes in Equity
Directors' Declaration
Independent Auditor’s Report
Corporate Governance & Shareholder Information
Company Directory
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: Executive Chairman’s & CEO’s
letter
Dear ReNu Energy Shareholders
Since the last Annual Report, ReNu Energy Limited (ReNu Energy or the Company) has made strong
progress towards an investment decision for the Company’s flagship Tasmanian green hydrogen projects
and advanced its portfolio of investments in renewable and clean energy technologies. ReNu Energy’s green
hydrogen projects are being undertaken through its wholly owned subsidiary, Countrywide Hydrogen Pty Ltd
(Countrywide Hydrogen and collectively the Group), which the Company acquired in February 2022.
Highlights of the Group’s progress during the period include:
• Completion of project definition, technology and supplier selection and basis of design for the Tasmanian
green hydrogen projects.
• Signing a definitive Platform Agreement with Australian superannuation fund HESTA for co-investment
in the Group’s green hydrogen projects.
• Progressing green hydrogen offtake collaborations and partnerships, commencing the process to apply
for ARENA and State government funding.
• Announcing the Group’s refuelling strategy – to be the operator of Hydrogen Refuelling Stations (HRS)
– and the launch of the Group’s refuelling brand: H2Co Energy.
• Generating a fair value gain on the Company’s incubator investments of $2,943,752 off the back of Origin
Energy agreeing to invest $4 million in Allegro for a 5% interest.
• Expanding the Company’s portfolio with a $500,000 investment in battery casing technology company
Vaulta for a 10% interest (with a further $250,000 invested in July 2023 for a cumulative 15% interest
and the option to invest a further $250,000 for an interest up to 20%) and investing a further $1 million in
Enosi for a cumulative 14% interest.
• Completing an oversubscribed capital raising of $4.5m.
We provide below a summary of activities for the period, our investment rationale and ambition for the year
ahead.
Green hydrogen
The potential domestic market for green hydrogen (hydrogen produced using renewable electricity) is growing
due to the appetite for decarbonising industry, road transport and natural gas networks, with many Australian
companies having set emissions reductions targets they are striving to meet. Emissions reduction using
hydrogen has also been endorsed as deliverable by Federal and State governments with multiple funding
announcements made during the period.
Road transport plays a critical role in the Australian economy and in 2022 the sector made up 19% of
Australia’s emissions.1 With major companies and sectors targeting the delivery of their announced emissions
1https://www.dcceew.gov.au/energy/transport#:~:text=In%202022%20our%20transport%20sector,source%20of%20emissions%20by
%202030.
1
reductions targets, the Group is focused on companies that have identified road transport as a target for
decarbonising their operations.
The Group’s domestic green hydrogen supply ambition is to implement its model
in Tasmania first (Tasmania is 100 per cent self-sufficient in renewable electricity
generation2) and then to replicate the model to suitable markets across mainland
Australia and internationally. The Tasmanian model creates a hydrogen
ecosystem by providing statewide access to green hydrogen – the proposed
projects span three strategic locations near Hobart, Launceston and Devonport.
We call it a Hydrogen HyWay. Each strategic location has been selected after
analysing transport volumes and heavy vehicle movements and provides for an
initial 5 megawatt (MW) electrolyser for hydrogen production with storage and a
fuelling station. These projects are in harmony with recently announced new
Tasmanian state funding to support 5-10MW hydrogen production facilities
focused on domestic demand.
The model provides the flexibility for one of the two locations in the north of the
State to come online initially with the other to follow as demand increases. At
the Brighton location near Hobart, the Group is collaborating with TasGas to
provide the option for industrial customers to access 100% green hydrogen
supply and to inject green hydrogen into the natural gas network, thereby
assisting TasGas to achieve its strategic decarbonisation objective.
Progress made on the Group’s Tasmanian green hydrogen projects during the
period includes:
• Working with the Group’s engineers, Wood,
to complete project definition, technology
selection and basic design.
• Selection of Plug Power as the preferred
contractor to supply 5MW proton exchange
membrane (PEM) electrolysers, Fabrum as
the preferred contractor to provide HRS, and
Wasco as the construction contractor.
• Launching the Group’s refuelling strategy – to
be the operator of HRS – and the launch of
the Group’s refuelling brand: H2Co Energy
(with the Group’s intention to target a low
hydrogen
through customers
purchasing green hydrogen directly from
Countrywide Hydrogen rather than via third-
party resellers).
fuel cost
Artist Impression
• The signing of a definitive Platform Agreement with Australian superannuation fund HESTA for co-
investment in the Group’s green hydrogen projects.
• Working with TasGas to enable 100% green hydrogen delivery to industrial customers and blending of
green hydrogen into the natural gas distribution network.
• Partnering with 7R Logistics, with the Group to provide the green hydrogen necessary to commence the
decarbonising of trucking in Tasmania.
2 https://www.stategrowth.tas.gov.au/__data/assets/pdf_file/0007/420586/Renewable_Energy_Tasmania_-_English.pdf
2
• Partnering with Walkinshaw Group to assess
the feasibility of delivering right-hand-drive
hydrogen fuel cell trucks throughout Australia
with the Group building, and Walkinshaw
supplying, the market.
• Together with Deloitte, progressing ARENA
grant funding applications.
• Working with
the Tasmanian
state
government to participate in its Renewable
Hydrogen Action Plan and apply for financial
support for the Group’s projects.
On the mainland, ReNu Energy progressed the
Melbourne Hydrogen Hub and Hydrogen
Portland opportunities during the period, including
evaluating land options, engaging with potential
international project partners and assessing the development of a distributed hydrogen production network
at these locations.
Artist Impression
ReNu Energy also progressed international green hydrogen opportunities with the signing of a memorandum
of understanding with Anantara (a joint venture between ib vogt & Quantum Power) to study green hydrogen
supply initially to Indonesia with potential to supply nearby countries in the Southeast Asian region.
Renewable and clean energy investments
A distinctive feature of ReNu Energy’s business model is to incubate and accelerate a portfolio of investments
in early-stage renewable and clean energy technologies with the potential to trigger investment revaluations
as the companies advance and to leverage potential synergies across the Group.
Vaulta is a battery casing tech company that has developed and patented technology for battery disassembly,
enabling replacement or re-purposing of individual cells leading to less battery waste and reduced landfill.
ReNu Energy’s first investment in Vaulta occurred during the period and represents the Company’s fifth
investment in Australian renewable and clean energy ingenuity. At the date of this report $750,000 has been
invested for a 15% interest (with the Company having the ability to invest up to $1 million for an interest of up
to 20%).
Allegro is developing water based Redox Flow
Batteries (RFBs) and supercapacitors that are
clean, non-flammable, non-corrosive, recyclable
with no reliance on scarce materials. At the core
of both products is Allegro’s unique water-based
electrolyte which enables energy storage that is
less expensive and safer
potentially
than
competing
technology. ReNu Energy has
invested $525,000 in Allegro for a 4.75%
the period Origin Energy
interest. During
acquired a 5% equity stake in Allegro Energy for
$4.0 million resulting in a revaluation of the
carrying value of the Company’s interest to
$3,398,752.
Enosi has developed Powertracer, a software as
a service clean energy solution that provides complete traceability of renewable energy, from production to
consumption. Hourly time stamps will be critical pieces of data for electricity retailers and large corporates
aiming to use 24/7 certified carbon free energy, which means matching the clean energy they buy to the
energy they consume every hour of every day. Enosi is also working with several green hydrogen proponents
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(including Countrywide Hydrogen) to be the certification partner for time and location matching of renewable
energy supply to electrolysers to be certified as green. During the period ReNu Energy Limited invested a
further $1 million in Enosi for a cumulative 14% interest.
Uniflow is commercialising a unique, micro renewable energy generator – The Cobber – that uses solid
biomass (such as agricultural waste) to create energy, delivering approximately 4.5kW of electrical power
and 20kW thermal energy. Uniflow believes the Cobber is the only biomass fuelled, residential scale,
combined heat and power (CHP) generator operating for demonstration anywhere in the world. Small scale
biomass fuelled CHP systems have an important role to play in displacing fossil fuel generators in off grid
applications. Uniflow has recently signed a provisional licensing agreement with Jauda Energy for potential
licensing of the technology in Europe.
Corporate
During the period, the Board of ReNu Energy welcomed the appointment of The Honourable Peter Gutwein,
former Tasmanian Premier and Treasurer, to the Board of its wholly owned subsidiary Countrywide Hydrogen
Pty Ltd. Peter’s role at Countrywide Hydrogen includes assisting with commercial negotiations, advising on
the processes for obtaining regulatory approvals and authorisations, and assessing the strategic, financial
and commercial implications of the current and future green hydrogen projects.
The Chairman, Boyd White, was appointed to an interim executive role during the period to apply his project
delivery expertise to work with Chief Executive Officer and Executive Director - Hydrogen to take the
Tasmanian green hydrogen projects to final investment decision.
The Company completed a successful capital raising of $4.5 million during the period through the issue of
75.5 million new ReNu Energy shares at an issue price of $0.060. Subscribers also received one free
attaching option for each share subscribed for.
Financial results
The loss for the period ($1,165,960) was 59% less than the corresponding period ($2,824,543) primarily due
to favourable revaluations of the Company’s carrying value of investee companies ($2,943,752). Expenses
were higher than the prior period due to increased green hydrogen project development expenditure, higher
personnel costs and a full year amortisation of intangible assets arising from the Countrywide Hydrogen
acquisition.
ReNu Energy had net operating cash outflows for the year of $3,255,285 and at 30 June 2023 had cash and
cash equivalents of $1,308,085. The Company is undertaking steps to raise capital to fund its 2024 financial
year business plan and budget.
The year ahead
The Board and management believe there is a strong investment case now for green hydrogen:
• Green hydrogen is currently enjoying unprecedented political, investment and business momentum
globally.
• Green hydrogen offers ways to decarbonise a range of sectors (including long-haul transport and natural
gas networks) where it is proving difficult to meaningfully reduce emissions.
• Technologies are available today that enable green hydrogen to be transformed into electricity, to reduce
emissions and to fuel trucks, buses and cars.
• Green hydrogen is one of the leading options for storing energy from renewables.
• The recent investment in green hydrogen by major global corporates attests to green hydrogen being
recognised as a fuel of the future.
Likewise, the Board and management believe the investment case for ReNu Energy is strong:
• First mover access to a green hydrogen ecosystem with the three Tasmanian locations providing
statewide coverage.
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• The Tasmanian model provides a showcase for rolling out to the mainland and internationally.
• The domestic supply focus and ability to scale facilitates in the future creates a robust value proposition.
• Strong partners and government support.
• Revaluation events on the horizon, including but not limited to targeted final investment decision for the
Tasmanian green hydrogen projects, positive earnings from green hydrogen production targeted from
mid-2025, investee company revaluations and merger & acquisition activity.
The Board and management believe that the Group is well positioned to:
• Advance the Tasmanian green hydrogen projects to a final investment decision and progress the Group’s
green hydrogen pipeline of projects.
• Support and progress the Company’s other renewable and clean energy investments.
Our purpose is to strategically drive the transition to a low carbon future by investing in renewable and clean
energy technologies and projects.
Our key priorities for the year ahead are to:
• Continue our work to create a green hydrogen ecosystem in Tasmania.
• Continue to explore expansion of green hydrogen opportunities onto mainland Australia and
internationally.
• Build value in and as appropriate, expand our portfolio of renewable and clean energy investments.
On behalf of the Board, we acknowledge and thank our staff and contractors for their efforts and thank you,
our shareholders, for your continued interest and support of ReNu Energy and the delivery of our purpose.
Yours faithfully
Boyd White
Executive Chairman
Greg Watson
Chief Executive Officer & Company Secretary
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: Directors’ report
Director Profiles
Your Directors submit their report for the year ended 30 June 2023. The names and details of the Directors
of ReNu Energy Limited in office during the financial year and until the date of this report are as follows.
Directors were in office for this entire period unless otherwise stated.
Name & Qualifications
Experience
Boyd White
BBus(Acc) & MBA
Chairman
(until 14 May 2023)
Executive Chairman
(from 15 May 2023)
Mr White has an accomplished record in the energy, infrastructure and
mining sectors. He has over 30 years of business experience and brings
strong strategic, commercial, M&A, financing and entrepreneurial skills to
the ReNu Energy Board.
Mr White has held executive roles internationally with US multinationals
Halliburton Company and KBR Inc, and domestically with Tarong Energy,
and Territory Generation.
Mr White was a founding partner in ARC Developments International,
providing energy advisory services and developing or acquiring renewable
energy projects.
Mr White is currently the Principal of New Energy Capital and, amongst other
things, is developing a €500m bioenergy and geothermal business in Europe
and involved in executive management, clean energy and capital raising
activities in the small cap resources sector.
Mr White holds a Bachelor of Business (Accounting) from Queensland
University of Technology and an MBA from the University of Queensland.
Mr White has had no other listed company directorships in the past three
years.
Mr White is a member of the Remuneration and Nominations Committee.
On 15 May 2023, following a strategic review of business needs, Mr White
assumed the role of Executive Chairman on an interim basis. In this capacity
Mr White is working closely with the executive team to help drive strategy
and assist with taking ReNu Energy's green hydrogen projects in Tasmania
to final investment decision.
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Directors’ Report (continued)
Name & Qualifications
Experience
Tony Louka
MBA & MAICD
Non-executive Director
Mr Louka has 24 years of industry experience in Board, executive and
management roles in the energy supply chain, clean technology solutions
as well as retail & industrial property sectors. Mr Louka is the Managing
Director of Maxify Consulting a bespoke ESG & asset management advisory
to various ASX corporates & innovative start-ups in the Asia Pacific. He has
held previous management and executive roles at Woolworths Group,
Ergon Energy and Emerson Network Power. He has also served as a Board
Member of the Energy Users Association of Australia and the Transgrid
Advisory Council.
Mr Louka was appointed to the Board as a Non-executive Director on 27
September 2018. He was then appointed as interim Managing Director and
Acting CEO on 20 September 2019 to oversee the company restructure. Mr
Louka returned to his previous position of Non-executive Director effective
28 February 2020.
Mr Louka has had no other listed company directorships in the past three
years.
Mr Louka is Chair of the Remuneration and Nominations Committee and a
member of the Risk and Audit Committee.
ReNu Energy has nominated Mr Louka as a Non-executive Director of
investee company Enosi Australia Pty Ltd with the appointment taking effect
on 20 June 2023.
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Directors’ Report (continued)
Name & Qualifications
Experience
Tim Scholefield
BAppSc, MBA, GAICD, Cert
Gov (Risk)
Non-executive Director
Mr Scholefield is a Director and senior executive with global experience in
project delivery, operations, financial, commercial, governance and risk
management.
Mr Scholefield has more than 30 years’ experience across the resources
and energy value chain including: exploration, production and operations;
conventional, unconventional and renewable fuel sources; gas storage and
offtake, power generation and the link to customers.
Mr Scholefield is a Director and Principal of Pacific Energy Partners, a
consultancy providing advice on renewable energy solutions and
opportunities in the Pacific and Southeast Asia. He has served as a chair
and participant on board committees evaluating and developing energy
projects, managing joint venture and other stakeholder relationships and
providing strategy, risk, commercial and governance support. He has
experience leading small and large cross functional technical, financial,
commercial, legal, project and operations teams; making recommendations
and participating in acquisitions, divestments and greenfield and brownfield
projects ranging in size from $USD 1 million to $USD 5 billion.
Mr Scholefield holds a Bachelor of Applied Science from the University of
South Australia, a MBA from Deakin University, a Certificate in Governance
and Risk Management from the Governance Institute of Australia and is a
Graduate of the Australian Institute of Company Directors.
Mr Scholefield has had no other listed company directorships in the past
three years.
Mr Scholefield had executive responsibility to coordinate, implement and
oversee the permanent abandonment of the Company's geothermal wells in
the Cooper Basin and to assist the CEO in the assessment and
renewable and clean energy
recommendation
opportunities. With
the Company’s geothermal wells permanently
abandoned during 2021 and a portfolio of renewable and clean energy
investments secured, Mr Scholefield ceased his executive role on 31
December 2021.
involvement
for
in
Mr Scholefield is Chair of the Risk and Audit Committee.
ReNu Energy has nominated Mr Scholefield as a Non-executive Director of
investee company Vaulta Holdings Pty Ltd with the appointment taking
effect on 20 July 2023.
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Directors’ Report (continued)
Name & Qualifications
Experience
Susan Oliver AM
FAICD B Property and
Construction Melb University,
Cert Fin Mngt
Non-executive Director
Geoffrey Drucker
BEc, CPA
Executive Director
Ms Oliver is an accomplished leader with more than 25 years' experience at
a director and senior executive level.
Ms Oliver has extensive Board and governance experience as Chair and
Non-executive Director with listed companies including Transurban Group,
Centro Group restructure, Programmed Group, Coffey International,
Simonds Homes and the Just Group. She serves on the global Investment
Committee for IFM Investors and was founding Chair of Scale Investors
retiring in June 2021. She is currently Chair of the Alice Anderson Fund
Investment Committee for the Victorian government.
Previously, Ms Oliver had a career in technology and futures consulting with
Accenture, pioneer technology strategy company Invetech and leading the
Commission for the Future for the Australian Government. She held senior
roles in the public service in Housing and Industry departments in Victoria.
Her Order of Australia was awarded for services to business and women.
Ms Oliver holds a Bachelor of Property and Construction from Melbourne
University and a Certificate in Financial Management. She is a Fellow of the
Australian Institute of Company Directors.
Ms Oliver has had no other listed company directorships in the past three
years.
Ms Oliver is a member of the Risk and Audit Committee and the
Remuneration and Nominations Committee.
Mr Drucker is an experienced senior executive with a background in the
renewable energy sector spanning three decades. He has extensive
expertise in the renewable sector including renewable project initiation
experience.
Mr Drucker commenced his career with State Electricity Commission of
Victoria and has held roles with PwC and several private consultancies.
His previous Board experience includes appointments with Methodist
Ladies’ College where he was Vice Chairman for five of his nine-year tenure,
the Variety Club of Australia and various private companies including
business development consultants Corporate Kudos Pty Ltd and DYDX Pty
Ltd. Through both companies he represented ASX-listed companies and
Governments.
Mr Drucker holds a Bachelor of Economics and has been admitted as a
Certified Practising Accountant.
Mr Drucker has had no other listed company directorships in the past three
years.
Mr Drucker is ReNu Energy’s largest individual shareholder having been a
founder of Countrywide Hydrogen Pty Ltd.
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Directors’ Report (continued)
Chief Executive Officer and Company Secretary
Greg Watson
LLB, BCom, GDipLP, CA
Mr Watson joined ReNu Energy as Chief Financial Officer and Company Secretary in September 2019 and
was appointed as Chief Executive Officer in February 2020. He has a strong background in finance, tax, legal
and company secretarial disciplines.
Mr Watson has 17 years’ experience with listed and private companies in the resources and energy sectors.
Mr Watson previously worked as CFO and Company Secretary at Capricorn Copper and has also held
corporate roles at Anglo American, Barrick Gold, Equinox Minerals and Fortescue Metals. Mr Watson
commenced his career at KPMG where he worked for 9 years.
Mr Watson is a Chartered Accountant and holds a Bachelor of Laws and Bachelor of Commerce degrees, as
well as a Graduate Diploma in Legal Practise.
Corporate structure
ReNu Energy Limited is a company limited by shares, incorporated and domiciled in Australia.
Its registered office and principal place of business is Corporate House, Kings Row 1, 52 McDougall Street,
Level 2, Milton QLD 4064.
The Directors present this financial report on ReNu Energy Limited (the Company) and its subsidiaries
(collectively the Group) for the financial year ended 30 June 2023.
Principal activities
ReNu Energy’s purpose is to strategically drive the transition to a low carbon future. It does this by identifying
and developing green hydrogen projects and investing in renewable and clean energy technologies to create
stakeholder value. ReNu Energy’s vision is to be a leader in the renewable and clean energy sector in
Australia striving for a sustainable future, producing green hydrogen and with a portfolio of domestic and
international renewable and clean energy projects.
Significant changes in the state of affairs
Significant changes in the state of affairs of the Group during the financial period were:
•
•
•
•
•
Strong progress towards the Group’s final investment decision for its flagship Tasmanian green
hydrogen projects, including the completion of project definition, technology and supplier selection and
basis of design.
The signing of a definitive Platform Agreement with Australian superannuation fund HESTA for co-
investment in the Group’s green hydrogen projects.
Progressing green hydrogen offtake collaborations and partnerships, commencing the process to apply
for ARENA funding and State Government briefings.
Increase in the carrying value of investee company Allegro Energy by $2.85m following Origin Energy
acquiring a 5% equity stake.
Expanding the Group’s portfolio with an investment in battery casing technology company Vaulta.
10
Directors’ Report (continued)
Significant changes in the state of affairs (continued)
•
•
The investment of a further $1 million in Enosi for a cumulative 14% interest.
Completing an oversubscribed capital raising of $4.5m.
There were no other significant changes in the state of affairs of the Company during the financial period.
Operating and Financial Review
The Company realised a loss before tax for the financial period as set out below:
Non-IFRS Measure
EBITDA – by business segment
Hydrogen
Renewable & clean energy investments
Corporate
Total Group EBITDA
Equity Accounted Share of Profit/(Loss)
Depreciation
Amortisation & impairment
Interest expense
Income tax (expense)/benefit
Loss after tax
2023
$
2022
$
(1,500,736)
(345,398)
2,917,975
(41,916)
(2,124,913)
(2,190,197)
(707,674)
(2,577,511)
(78,141)
(82,518)
-
(58,979)
(453,370)
(183,833)
(3,558)
159,301
(4,220)
-
(1,165,960)
(2,824,543)
The above non-IFRS information has been audited.
Financial Position
The Group has net operating cash outflows for the year of $3,255,285 and as at 30 June 2023 has cash and
cash equivalents of $1,308,085. Subsequent to year end, the Group paid the third tranche of $250,000 to
acquire a further 5% interest in an associate, Vaulta Holdings Pty Ltd. At the date of this report, the Group
had $335,035 in cash and cash equivalents. The Group completed an oversubscribed private placement to
sophisticated and institutional investors on 29 November 2022, raising $4,530,000.
Results
The Group’s Underlying EBITDA loss of $707,674 (2022: $2,577,511) was less than the corresponding period
primarily due to favourable revaluations of the Company’s carrying value of investee companies. Operating
expenses were higher than the prior period due to increased green hydrogen project development
expenditure and higher personnel costs as the Group’s flagship Tasmanian green hydrogen projects progress
towards final investment decision.
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Directors’ Report (continued)
Operating and Financial Review (continued)
Operational review
During the year ended 30 June 2023 and in keeping with its purpose to strategically drive the transition to a
low carbon future, ReNu Energy’s activities centred around progressing its Tasmanian green hydrogen
projects and growing its portfolio of interests in renewable energy technologies and projects.
The results for the year have reinforced the Board and management’s view of the strong investment case for
green hydrogen where the initial focus is on domestic supply and the upside potential of its portfolio of
investments. The Group has maintained first mover status in green hydrogen development through
progressing an ecosystem in Tasmania that provides statewide coverage. The Tasmanian model provides a
showcase for a national rollout.
Key activities during the year included:
Green hydrogen
•
•
•
Strong progress towards the Group’s final investment decision for its Tasmanian green hydrogen
projects, including working with the Group’s engineers, Wood, to complete project definition, technology
selection and basic design.
Selection of Plug Power as the preferred contractor to supply 5MW Proton Exchange Membrane
electrolysers, Fabrum as the preferred contractor to provide Hydrogen Refuelling Stations and Wasco
as the construction contractor.
The signing of a definitive Platform Agreement with Australian superannuation fund HESTA for co-
investment in the Group’s green hydrogen projects.
• Working with TasGas to tie in project design to enable 100% green hydrogen delivery to industrial
customers and blending of green hydrogen into the natural gas distribution network.
•
•
•
•
•
Partnering with 7R Logistics and Walkinshaw Group to decarbonise trucking in Tasmania through green
hydrogen offtakes and to provide hydrogen powered trucks.
Together with Deloitte, progressing ARENA grant funding applications.
Briefing the Tasmanian Premier Jeremy Rockliff and Energy Minister Guy Barnett on the projects’
progress and alignment with the Tasmanian Renewable Hydrogen Action Plan (the Tasmanian
Government has ambitious plans for developing a world class green hydrogen sector and is committed
to supporting the development of a domestic green hydrogen industry).
Progressing the Group’s international green hydrogen opportunities through signing a MOU with
Anantara (a joint venture between ib vogt & Quantum Power) to study green hydrogen supply initially to
Indonesia with potential to supply nearby countries in the Southeast Asian region.
Progressing the Melbourne Hydrogen Hub and Portland opportunities, including evaluating land options,
engaging with potential international project partners and assessing the development of a distributed
hydrogen production network at these locations.
12
Directors’ Report (continued)
Operating and Financial Review (continued)
Investee companies
• Origin Energy acquiring a 5% equity stake in battery technology company Allegro Energy for $4 million
resulting in a revaluation of the carrying value of the Group’s 4.86% interest to $3,398,752 which was
achieved at a cost of investment of $545,000.
•
•
Increasing the Company’s portfolio of investments in Australian renewable and clean energy ingenuity
to five through an agreement with battery casing technology company Vaulta for the investment of up to
$1 million and an interest of up to 20% ($750,000 invested for a 15% interest at the date of this report).
The investment of a further $1 million in Enosi for a cumulative 14% interest. Enosi’s Powertracer product
provides a grid-scale platform for 24/7 clean energy traceability.
Corporate
• Completing an oversubscribed capital raising of $4.5m through the issue of 75 million new ReNu Energy
shares at an issue price of $0.06 per share by way of placement to professional and sophisticated
investors.
• The appointment of The Hon Peter Gutwein, former Tasmanian Premier and Treasurer, to the Board of
Countrywide Hydrogen.
• The appointment of the Chairman to an interim executive role to apply his project delivery expertise to
work with CEO and Executive Director to take the Tasmanian green hydrogen projects to final investment
decision.
Material business risks
The Group has various risk management policies and procedures in place to enable the identification,
assessment and mitigation of business risks that may arise. This section of the Directors’ report describes
the Group’s material business risks. Whilst the Group can mitigate some of the risks described below, many
are beyond the control of the Group. For further information on the Group’s risk management framework refer
to
(https://renuenergy.com.au/why-invest-in-
us/governance/).
the corporate governance section of
the website
Offtake and commercialisation
The Group's ability to successfully develop and commercialise its green hydrogen projects may be affected
by numerous factors including but not limited to macro-economic conditions, obtaining required approvals,
securing renewable power supply and customer offtakes, the rate of transition to fuel cell electric vehicles,
delays in commissioning or ramp up, the hydrogen production facility not performing in accordance with
expectations and cost overruns.
If the Group is unable to mitigate these factors this could result in delays in the development of the projects
or the Group not realising the development plans for the projects, which would have a material adverse effect
on the Group’s business, financial performance and prospects.
Future capital requirements
The development of the Group’s green hydrogen projects will require substantial expenditure. No decision
has been made in relation to the Group’s contribution to funding the development of the hydrogen projects.
Subject to making a final investment decision with respect to the development of the hydrogen projects, the
Group will require additional funding to procure equipment and undertake construction activities.
13
Directors’ Report (continued)
Review and results of operations (continued)
Although the Group believes that additional funding can be obtained, no assurances can be given that the
Group will be able to raise this additional funding, which may be a combination of co-investment, Government
grants, debt and equity financing. To meet such funding requirements, the Group may be required to
undertake additional equity financing, which would be potentially dilutive to shareholders depending on their
participation in any previous equity raising. Debt financing, if available, may involve certain restrictions on
operating activities.
The Group’s ability to achieve co-investment, Government grants or debt funding, and raise further equity,
and the terms of such transactions will vary according to a number of factors, including the results achieved
by the Group, Government policies, stock market conditions, the overall risk appetite of investors along with
access to credit markets and other funding sources.
An inability to obtain the required additional finance as and when required would delay progress on the
development of the projects, which would have a material adverse effect on the Group’s business, financial
performance and prospects.
Loss of key personnel
The Group relies heavily on the abilities of key employees and management. The Group's performance is
reliant on its ability to both retain and attract skilled individuals and to appropriately incentivise them. Although
the Group expects to be able to attract and retain skilled and experienced personnel, there can be no
assurance that it will be able to do so. The Group intends to mitigate these risks by entering into service
contracts with any new employees and, where appropriate, utilise existing and established incentive plans to
maintain employees’ loyalty to the Group.
Reliance on third party providers
There is a risk that goods and services that are required for the Group’s hydrogen projects development are
difficult to procure or will not be delivered on time or to the necessary quality or expected cost which may
affect the operation of the projects. The Group does not have in place formal written contracts with all of its
key suppliers. The deterioration of any such key relationships or a change in the circumstances or
requirements of the key suppliers, or market conditions generally, could therefore have significant operational
and financial implications for the Group. Moreover, a failure by any one of those suppliers to perform their
services, or a disruption to the supply chain, may have an adverse effect on the operations of the Group and
its financial performance.
Changes in energy policy
The Australian renewable hydrogen energy market is currently in its infancy stage of development. Due to
the current low cost of producing electricity via traditional means, the commercialisation of green hydrogen
projects currently relies, and is dependent upon, obtaining Government subsidies and grants sufficient to
achieve a competitive cost per kilogram of renewable energy produced. Whilst the current environment is
positive, the Government policies for Australia’s renewable energy industry are uncertain and subject to
change. This may reduce new investment in the green hydrogen industry in Australia which could reduce the
number of available new business prospects for the Group.
Business performance may be impacted by changes in the design and rules of the existing energy market
and the uncertainty that arises from debate in relation to the energy market’s future design and rules. These
changes may result from orderly rules change processes or in response to political imperatives of the
government or agencies of government from time to time.
14
Directors’ Report (continued)
Review and results of operations (continued)
Construction
There is a risk that the hydrogen projects may not proceed as planned. This could be the result of matters
within or outside the Group’s control. Examples may include weather events, natural disasters, contractor
risk, regulatory intervention or failure to obtain or retain suitably qualified expertise. The occurrence of any
such event could result in the projects costing more or not proceeding as planned, including delays in
completion and/or commissioning or failure to perform to technical specifications.
Any delays in or failure of construction or increases in costs may adversely affect the yield of the investment
and consequently impact the Group's operating and financial performance.
Emerging nature of the green hydrogen industry
The prospects of the Group must be considered in the light of the emerging nature of its business and the
risks, expenses and difficulties frequently encountered by companies in the early stages of project
development. If the Group’s business model does not prove to be profitable, investors may lose their
investment.
Investee companies
There is a risk that one or more of the Group’s investee companies will not succeed in scaling their renewable
energy technologies and projects to a stage that will generate positive returns for the Group, and that may
lead to a write-down in the carrying value of one or more investments.
Climate change risk
Climate-related factors that may affect the operations and proposed activities of the Group include:
• The emergence of new or expanded regulations associated with the transitioning to a lower-carbon
economy and market changes related to climate change mitigation. The Group may be impacted by
changes to local or international compliance regulations related to climate change mitigation efforts, or
by specific taxation or penalties for carbon emissions or environmental damage.
• Climate change may cause certain physical and environmental risks that cannot be predicted by the
Group, including events such as increased severity of weather patterns and incidence of extreme
weather events and longer-term physical risks such as shifting climate patterns.
Likely developments and expected results
The Board and management believe that the Group is well positioned to:
•
•
Advance the Tasmanian green hydrogen projects to a final investment decision in 2023 and progress
the Group’s other green hydrogen projects.
Support and progress the Group’s other renewable and clean energy investments and to assess
opportunities for additional renewable & clean energy investment opportunities where the Group’s
investment criteria is met.
The Board and management believe the Group's outlook is strong through:
•
•
•
First mover access to a green hydrogen ecosystem with the Tasmanian locations providing statewide
coverage and targeting first production mid-2025.
The Tasmanian model providing a showcase for a national rollout.
The Group’s domestic supply focus and ability to scale size providing a strong economic model with a
target hydrogen price for road transport that competes favourably with diesel and yields zero emissions.
15
Directors’ Report (continued)
•
Investment returns through incubating and accelerating the Group’s portfolio of investments in
renewable and clean energy technologies and projects.
Dividend
No dividends were declared or paid during the year ended 30 June 2023.
The Directors do not propose to recommend the payment of a dividend in respect of the period ended
30 June 2023.
Directors' interests in the Shares and Options of the Company
As at the date of this report, the interests of the Directors in the shares of ReNu Energy Limited were:
Director
Boyd White
Tony Louka
Tim Scholefield
Fully paid
Ordinary
Shares
Loan Plan
Shares
Listed Options
over ordinary
shares
1,433,333
318,421
901,931
9,000,000
6,000,000
6,000,000
8,000,000
6,000,000
333,333
-
-
83,333
-
Geoffrey Drucker
34,627,291
Susan Oliver
-
Significant events after the reporting date
No matter or circumstance has arisen since 30 June 2023 that has significantly affected, or may significantly
affect the Group's operations, the results of those operations, or the Group's state of affairs in future financial
years.
Environmental regulations and performance
As a renewable and clean energy developer and investor, environmental sustainability is at the heart of every
activity ReNu Energy undertakes.
The Group is required to carry out its activities in accordance with relevant laws and regulations. The Group
is committed to minimising the impact of its activities on the natural landscape, waterways, flora and fauna in
a manner consistent with environmental best practice standards.
Indemnification and insurance of Directors and officers
During the financial year, the Company paid premiums in respect of contracts insuring Directors, Secretaries,
and executive officers of the Group and related entities against liabilities incurred as Director, Secretary or
executive officer to the extent permitted by the Corporations Act 2001, subject to the terms, conditions,
limitations and exclusions of the policy. Under the terms of the policy, the Group is precluded from disclosing
details of premiums paid.
The Company has entered into deeds of indemnity, insurance and access with each person who is, or has
been, a Director of the Company. To the extent permitted by law and subject to the restrictions in s199A of
the Corporations Act 2001, the Company must continually indemnify each Director against liability (including
liability for costs and expenses) for an act or omission in the capacity as Director, subject to certain exclusions.
No payment has been made to indemnify a Director during or since the end of the financial year.
16
Directors’ Report (continued)
Indemnification of auditors
The Company has not otherwise, during or since the end of the financial year, except to the extent permitted
by law, indemnified or agreed to indemnify an auditor of the Company or of any related body corporate against
a liability incurred as such an auditor.
Rounding
The amounts contained in this report and in the financial report have been rounded to the nearest $1 (unless
otherwise stated).
Share Options
Under the terms of the 23 November 2022 capital raising of $4.55 million by way of a placement to
professional and sophisticated investors at $0.060 per share, subscribers were entitled to receive 1 attaching
option for every share subscribed for, with a strike price of $0.07 and an expiry date of 31 December 2023.
12,583,348 options (Options) were issued on 29 November 2022 and granted quotation on the ASX on 30
November 2022. Shareholder approval was obtained at an extraordinary general meeting held on 31 January
2023 for the grant of options that exceeded the Company’s placement capacity and to Directors and
associates that participated in the placement. These remaining 63,333,318 options were issued on 1
February 2023 and granted quotation on the ASX on 3 February 2023 respectively.
Shareholder approval was obtained at an extraordinary general meeting held on 31 January 2023 for the
grant of 12,500,000 options with an exercise price of $0.07 per share expiring on 31 December 2023 to the
lead manager and broker of the capital raising (Broker Options). The Broker Options were issued on 1
February 2023 and granted quotation on the ASX on 3 February 2023.
No share options holder has any right under the options to participate in any other share issue of the company
or any other entity. 19,455 shares were issued on 2 December 2022 upon the exercise of 19,455 listed
options ($0.07 each) raising $1,361.
Directors’ meetings
During the period, there were 12 Directors’ meetings held. The number of Directors’ meetings and the number
of meetings attended by each of the Directors of the Company during the financial period are as follows:
Directors’ meetings
Risk & Audit Committee
meetings
Remuneration &
Nominations Committee
meetings
A
5
5
5
5
4
H
5
5
5
5
5
A
-
5
5
-
5
H
-
5
5
-
5
A
2
2
-
2
-
H
2
2
-
2
-
Boyd White
Tony Louka
Tim Scholefield
Geoffrey Drucker
Susan Oliver
A – Number of meetings attended
H – Number of meetings held whilst in office / a Committee member
17
Directors’ Report (continued)
Committee memberships as at 30 June 2023 was:
Risk & Audit Committee – Membership comprises three Non-executive Directors: Tim Scholefield (Chair),
Tony Louka and Susan Oliver.
Remuneration & Nominations Committee – Membership comprises one Non-executive Director: Tony
Louka (Chair); and two Executive Directors: Geoffrey Drucker and Boyd White.
On 29 August 2023, Susan Oliver joined the Remuneration & Nominations Committee and Geoffrey Drucker
stepped down. This occurred to ensure a majority of the members of the Committee are independent directors
following Boyd White's appointment to an interim executive role on 15 May 2023.
Auditor independence
In accordance with section 307C of the Corporations Act 2001, the Directors received a declaration of
independence from the auditor of ReNu Energy Limited which is listed immediately after this report and forms
part of this Directors’ Report and can be found on page 29.
Non-audit services
The Company may decide to employ the auditor on assignments in addition to their statutory audit duties,
where the auditor’s expertise and experience with the Company and/or the Group are important.
Details of amounts paid or payable to the auditor (BDO Audit Pty Ltd) for audit and non-audit services
provided during the year are set out in note 14 to the Financial Statements. During the year there were nil
(2022: $90,000) fees paid or payable for non-audit services provided by the auditor of the parent entity, its
related practices and non-related audit firms.
The Board of Directors has considered the position and is satisfied that the provision of the non-audit services
is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001.
The Board of Directors, in accordance with advice provided by the Risk and Audit Management Committee,
are satisfied that the provision of non-audit services by the auditor, as set out in note 14 to the Financial
Statements, did not compromise the auditor independence requirements of the Corporations Act 2001 for the
following reasons:
•
•
all non-audit services have been reviewed by the Risk and Audit Committee to ensure they do not
impact the impartiality and objectivity of the auditor; and
none of the services undermine the general principles relating to auditor independence as set out in
APES 110 Code of Ethics for Professional Accountants.
Proceedings on behalf of the Company
As far as the Directors are aware, no proceedings have been brought or intervened in on behalf of the
Company with the leave of the Court, nor has any application for leave been made in respect of the Company,
under section 237 of the Corporations Act 2001.
Corporate governance
The Directors recognise the need for the highest standards of corporate behaviour and accountability and
therefore support and have adhered to the principles of Corporate Governance. The Company’s Corporate
the Company’s website: http://renuenergy.com.au/about-
Governance Statement
us/governance/
is available on
18
Directors’ Report (continued)
Remuneration Report (Audited)
This Remuneration Report for the year ended 30 June 2023 outlines the remuneration arrangements in place
for Directors and Executives of ReNu Energy Limited in accordance with the requirements of the Corporations
Act 2001 and its Regulations. This information has been audited as required by section 308(3C) of the Act.
The Remuneration Report is presented under the following sections:
1.
Introduction
2. Remuneration governance
3. Executive remuneration arrangements
A. Remuneration principles and strategy
B. Approach to setting remuneration
C. Details of Incentive Plans
4. Executive remuneration outcomes for FY23 (including link to performance)
5. Summary of executive contractual arrangements
6. Non-executive Director remuneration
7. Share based compensation
8. Other statutory disclosures
19
Directors’ Report (continued)
Remuneration Report (Audited)
1.
Introduction
The Remuneration Report details the remuneration arrangements for Key Management Personnel (KMP)
who are defined as those persons having authority and responsibility for planning, directing and controlling
the major activities of the Company directly or indirectly including any Director.
For the purposes of this report, the term ‘executive’ encompasses the Chief Executive Officer and the
executive management team of the Company. The KMP covered in this report are set out in the table below.
Non-executive Directors (NEDs)
Boyd White (ceased 15 May 2023)
Tony Louka
Tim Scholefield
Susan Oliver
Executive Directors
Boyd White (commenced 15 May 2023)
Geoffrey Drucker
Other KMP
Greg Watson
KMP who ceased in prior year
Nil
Chairman
Director
Director
Director
Executive Chairman
Executive Director
Chief Executive Officer & Company Secretary
2.
Remuneration governance
Remuneration and Nominations Committee
The Remuneration and Nominations Committee has the primary objective of assisting the Board in
developing and assessing the remuneration policy and practices of the Directors, Chief Executive Officer
(CEO) and senior executives.
Specifically, the Board approves the remuneration arrangements of the CEO, the aggregate annual fixed
remuneration salary review, short-term incentives and the methodology for awards made under long-term
incentive plans following recommendations from the Remuneration & Nominations Committee. The Board
also sets the aggregate remuneration of Non-executive Directors, which is then subject to shareholder
approval, and individual Directors’ fees.
Committee assessments incorporate the development of remuneration policies and practices which will
enable the Group to attract and retain executives who will create value for shareholders. Executives will be
fairly and responsibly rewarded having regard to the performance of the Group, the performance of the
executive and the general market environment.
20
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
The Remuneration & Nominations Committee meets as required throughout the year. The CEO attends
Remuneration & Nominations Committee meetings by invitation, where management input is required. The
CEO is not present during any discussions related to his own remuneration arrangements.
Further information on the Remuneration & Nomination Committee’s role, responsibilities and membership
can be found on the Company’s web site at www.renuenergy.com.au
Use of remuneration consultants
During the year Talesca Pty Ltd was engaged to provide Non-executive Director and Executive remuneration
benchmarking data. The remuneration data provided was used as an input to the remuneration decisions by
the Board only. The Board considered the data provided, together with other factors, in setting Executive’s
remuneration. No remuneration recommendations, as defined by the Corporations Act 2001, were provided
by remuneration consultants.
3.
Executive remuneration arrangements
3A. Remuneration principles and strategy
ReNu Energy's executive remuneration strategy is designed to attract, motivate and retain highly skilled
executives and align the interests of executives and shareholders.
To this end, the Company embodies the following principles in its remuneration framework:
• Provide competitive salaries to attract high calibre executives.
• Link executive performance rewards to medium and longer-term shareholder value creation through Key
Performance Indicator (KPI) linked short term incentives.
• Establish appropriate share price performance hurdles under long-term incentive plans to align executive
reward with shareholder value creation, the achievement of which will depend on the Group achieving key
corporate milestones that are integral to the Group’s successful completion of its business plan.
The Group aims to reward its executives with a level and mix of remuneration commensurate with their
position and responsibilities within the Group to:
• Reward executives for Group, business division and individual performance against targets set by
reference to appropriate benchmarks.
• Link reward with the strategic goals and performance of the Group.
• Ensure total remuneration is competitive by market standards.
3B. Approach to setting remuneration
The key executives’ emoluments are structured to retain and motivate executives by offering a competitive
base salary, a short-term annual cash or share based performance related component together with longer
term performance incentives through the ReNu Energy Limited Loan Share Plan which aligns executives’
interests with those of shareholders.
For the year ended 30 June 2023, remuneration consisted of the following key elements:
• Fixed remuneration – base salary and superannuation; and
21
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
• Variable remuneration under the Company’s Loan Share Plan, payable in Shares subject to the
Company’s share price achieving specified hurdles.
The level of fixed remuneration is set to provide a base level of remuneration which is both appropriate to the
position and is competitive in the market. Fixed remuneration of the Chief Executive Officer is reviewed
annually by the Remuneration and Nominations Committee and approved by the Board. Factors considered
include the Group and individual performance, relevant comparative remuneration in the market and internal
and, where appropriate, external advice. The Remuneration and Nominations Committee has access to
external advice independent of management.
Senior executives receive their fixed (primary) remuneration in cash. The fixed remuneration component of
senior executives who are key management personnel is detailed in Table 1 of this report.
3C. Details of Incentive Plans
Short term incentives
The Company uses short term incentives to:
• Reward employees for their contribution in ensuring that ReNu Energy achieves corporate key
deliverables.
• Encourage teamwork.
• Enhance ReNu Energy attracting and retaining high calibre and high performing employees.
• Link remuneration directly to the achievement of key organisational objectives.
During the 2023 financial year no share-based payments were awarded to staff or executives. No Key
Management Personnel were awarded any cash incentives for the financial year.
Specific personal and corporate KPIs are set annually, and the award of short-term incentives will be
determined in relation to achievement of the relevant KPI.
Loan Share Plan
At the 2017 AGM, shareholders approved a Loan Share Plan (LSP) to retain, motivate and attract executives
and Directors and to better align the interests of employees and Directors with those of the Group and its
shareholders by providing an opportunity for employees and Directors to acquire shares subject to the terms
and conditions of the LSP (Plan Shares).
The Plan Shares are issued or transferred to the participants in the LSP at market value, subject to
shareholder approval in the case of Plan Shares issued to Directors and determined by the Board in its
absolute discretion for executives who are not Directors. The Group may provide a limited recourse loan to
participants to assist them to purchase Plan Shares (Loan).
The Plan Shares will vest on the satisfaction of any applicable performance condition, service requirement or
other conditions specified at the time of issue.
During the 2023 financial year, no Plan Shares were issued or vested under the Loan Share Plan.
22
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
Hedging of shares and options risk
Currently no Director or officer uses hedging instruments to limit their exposure to risk on either shares or
options in the Company. The Company’s policy is that the use of such hedging instruments is prohibited
4.
Executive remuneration outcomes for FY23
Company performance and its link to the Company's remuneration principles and strategy
The 2023 financial year saw the Group progress its flagship Tasmanian green hydrogen projects towards
final investment decision and grow its portfolio of investments in renewable and clean energy technologies.
The Board set specific measurable short-term targets for KMP for the 2023 financial year. Whilst a number
of the targets were met, no share based or cash incentives were awarded to KMP for the 2023 financial year.
It is intended that corporate and individual KPIs will again be set for the 2024 financial year, such that
executives are rewarded for the achievement of milestones that are both measurable and outcomes based.
These milestones will be set by the Board as they represent key drivers for creating short term shareholder
value.
The Company's Loan Share Plan has vesting conditions that are designed to align the interests of the
executives and shareholders through the delivery of substantial increased shareholder value, through the
Company's share price.
The remuneration of senior executives who were KMP during the year ended 30 June 2023 is set out below:
Table 1 – Remuneration of senior executives of the Group for the year ended 30 June 2023
Short-term*
Post employment* Share-based payments**
Salary
$
Consulting
Fees
$
Superannuation
$
Loan Share
Plan Shares
$
Bonus
Shares
$
Performance
related
%
Total
$
Name
G.Watson
350,000
-
36,750
77,292
G. Drucker
260,000
-
27,300
61,834
B. White1
8,125
39,000
-
-
Totals
618,125
39,000
64,050
139,126
* Fixed remuneration
** Variable remuneration
-
-
-
-
464,042
349,134
47,125
860,301
-
-
-
-
1 Mr White became Executive Chairman on 15 May 2023. Effective from this date he is engaged through an associated company,
White Lotus Solutions Pty Ltd (trading as New Energy Capital). The above table contains his remuneration for the period 15 May
2023 to 30 June 2023.
23
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
Table 2 – Remuneration of senior executives of the Group for the year ended 30 June 2022
Short-term* Post employment*
Share-based payments**
Name
Salary
$
Superannuation
$
Loan Share
Plan Shares
$
Bonus
Shares
$
Total
$
Performance
related
%
G Watson
328,538
32,854
31,552
54,675
447,619
T Scholefield1
125,223
-
18,931
54,675
198,829
G Drucker2
100,000
10,000
25,242
-
135,242
Totals
553,761
42,854
75,725
109,350
781,690
12%
20%
-
-
* Fixed remuneration
** Variable remuneration
1. T Scholefield is engaged through an associated company Pacific Energy Partners Pty Ltd. Mr Scholefield became a non-Executive
director on 1 January 2022. The above table contains his remuneration (including consulting fees) for the period 1 July 2021 to 31
December 2021. A portion of Mr Scholefield remuneration is recoverable by the Group under agreements with third parties.
2 Geoffrey Drucker was appointed as Executive Director on 8 February 2022.
5.
Summary of executive contractual arrangements
Remuneration arrangements for KMP are formalised in employment agreements. Details of these contractual
agreements are provided below.
Chief Executive Officer and Company Secretary – Greg Watson
Mr Watson was appointed as Chief Financial Officer and Company Secretary on 9 September 2019 under
an Employment Agreement dated 9 September 2019. Mr Watson was appointed Chief Executive Officer on
26 February 2020.
Mr Watson entered into a variation to Employment Agreement commencing 1 January 2022. The key terms
of Mr Watson’s employment are as follows:
• Base remuneration of $350,000 per annum plus superannuation.
• Discretionary short-term incentive up to a maximum of 30% of the base remuneration, to be awarded
based on achievement of KPIs to be specified by the Board.
• Long-term incentive (Loan Share Plan Shares) – Mr Watson was granted three equal tranches of
shares, totalling 10,000,000 shares, pursuant to the Loan Share Plan (Plan Shares), following
approval by shareholders at the extraordinary general meeting held on 1 February 2022. Each
tranche vests if, within 10 years of issue, the Company’s share price achieves a 15-trading day
volume weighted average price in excess of $0.15, $0.25 and $0.35 for each of the three tranches
respectively. Unvested shares vest upon a change of control of the Company. The shares were
issued at an Issue Price of $0.09 and Mr Watson was provided with an interest-free, non-recourse
loan for the value of the shares.
• Termination provisions as set out below:
24
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
Notice
period
Payment
in lieu of
notice
Resignation
3 months
3 months
Failure by Company to pay
remuneration or benefits
None
None
Treatment of
STI on
termination
Unvested
awards forfeited
Unvested
awards forfeited
Treatment of LTI on termination
Unvested awards forfeited
Unvested awards forfeited
Change of strategic
direction, material
diminution of the officer’s
duties or substantial
change in location
1 month
6 months
Unvested
awards forfeited
Where a change in control occurs,
the Board may determine that Loan
Share Plan Shares vest on terms
and conditions determined by the
Board
Termination for cause
14 days
None
Termination without cause
6 months
6 months
Unvested
awards forfeited
Unvested
awards forfeited
Unvested awards forfeited
Unvested awards forfeited
Executive Director – Geoffrey Drucker
Mr Drucker was appointed Executive Director – Hydrogen, on completion of the Company’s acquisition of
Countrywide Hydrogen Pty Ltd on 8 February 2022. Mr Drucker entered into a variation to Employment
Agreement effective 1 March 2023. The key terms of Mr Drucker’s employment are as follows:
• Base remuneration of $300,000 per annum plus superannuation.
• Conditional remuneration of $60,000 plus superannuation in the event of meeting defined hydrogen
project development milestones.
• Discretionary short-term incentive up to a maximum of 30% of the aggregate of the base and
conditional remuneration, to be awarded based on achievement of KPIs to be specified by the Board;
• Long term incentive (Loan Share Plan Shares) – Mr Drucker was granted three equal tranches of
shares, totalling 8,000,000 shares, pursuant to the Loan Share Plan (Plan Shares), following approval
by shareholders at the extraordinary general meeting held on 1 February 2022. Each tranche vests
if, within 10 years of issue, the Company’s share price achieves a 15-trading day volume weighted
average price in excess of $0.15, $0.25 and $0.35 for each of the three tranches respectively.
Unvested shares vest upon a change of control of the Company. The shares were issued at an Issue
Price of $0.09 and Mr Drucker was provided with an interest-free, non-recourse loan for the value of
the shares;
• Termination provisions as set out below:
25
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
Notice
period
Payment in
lieu of
notice
Treatment of STI on
termination
Treatment of LTI on
termination
Resignation
3 months
3 months
Failure by Company to pay
remuneration or benefits
None
None
Change of control
1 month
1 month
Termination for cause
14 days
None
Termination without cause
6 months
6 months
Executive Chairman – Boyd White
Unvested awards
forfeited
Unvested awards
forfeited
Unvested awards
forfeited
Unvested awards
forfeited
Unvested awards
forfeited
Unvested awards forfeited
Unvested awards forfeited
The Board may determine
that Loan Share Plan Shares
vest on terms and conditions
determined by the Board
Unvested awards forfeited
Unvested awards forfeited
On 15 May 2023 following a strategic review of the Group’s business needs, Mr White assumed the role of
Executive Chairman on an interim basis. In this capacity Mr White is working closely with the executive team,
including CEO Greg Watson and Executive Director, Geoffrey Drucker, to help drive strategy and assist with
taking ReNu Energy's green hydrogen projects in Tasmania to final investment decision.
Mr White is engaged through an associated company, White Lotus Solutions Pty Ltd (trading as New Energy
Capital). Mr White’s executive contract provides for an hourly rate of $250 (plus GST) to be capped at $2,000
(plus GST) for a full day worked for his consulting services. Mr White’s executive contract has no fixed period.
Each party may terminate by giving 4 weeks' notice. The engagement can be terminated immediately if Mr
White engages in misconduct, ceases to be a director in accordance with ReNu Energy's constitution, or is
removed as a director in accordance with Part 2D.3 of the Corporations Act 2001 (Cth). The executive
contract also contains provisions relating to the protection of intellectual property and confidential information,
that are customarily found in executive agreements of similar nature. In addition, Mr White is paid $65,000
per annum for his Chairman services.
6. Non-executive Director remuneration arrangements
Remuneration Policy
The Board seeks to set aggregate remuneration at a level which provides the Group with the ability to attract
and retain Directors of the highest calibre, whilst incurring a cost which is acceptable to shareholders.
The amount of aggregate remuneration sought to be approved by shareholders and the manner in which it
is apportioned among Directors is reviewed annually. The Board may consider advice from external
consultants as well as the fees paid to Non-executive Directors of comparable companies when undertaking
the annual review process. The amounts are set at a level that compensates the Directors for their significant
time commitment in overseeing the progression of the Company’s business plan.
26
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
The Constitution of ReNu Energy and the ASX Listing Rules specify that the aggregate remuneration of Non-
executive Directors shall be determined from time to time by a general meeting. An amount not exceeding
the amount determined is then divided between the directors as agreed. The latest determination was at the
Annual General Meeting held on 28 November 2007 when shareholders approved a maximum aggregate
remuneration of $700,000 per year.
Structure
Each Non-executive Director receives a fee for being a Director of the Company. The current fee structure is
to pay Non-executive Directors a gross annual remuneration of $50,000 per annum with the Chairman paid
$65,000 per annum. There are no additional fees paid for committee memberships. There are no retirement
benefits offered to Non-executive Directors.
The remuneration of Non-executive Directors for the year ended 30 June 2023 is detailed in Table 3 of this
report and the remuneration for the comparative year ended 30 June 2022 is detailed in Table 4.
Table 3 – Non-executive Directors’ Remuneration for the year ended 30 June 2023
Short-term*
Post employment*
Share-based payments**
Directors’
fees
Consulting
Fees
Superannuation
Loan Share
Plan Shares
Bonus
Shares
Director
B. White1
T. Louka2
T. Scholefield3
S. Oliver
Totals
$
51,471
50,004
49,416
45,249
196,140
$
-
-
107,923
-
107,923
$
5,404
-
4,751
4,751
$
69,563
46,375
46,375
46,375
14,906
208,688
$
-
-
-
-
-
Total
$
126,438
96,379
156,715
96,375
527,657
1. Mr B. White was a Non-executive Director (Chairman) until 14 May 2023 The above table includes fees paid for the period 1 July
2022 to 14 May 2023.
2. Mr .T Louka is engaged through an associated company, Maxify Pty Ltd, to provide director services to the Company.
3. The Group engages Pacific Energy Partners Pty Ltd to provide consulting services. Mr T. Scholefield is one of two Directors and
Principals of Pacific Energy Partners. The consultancy fees in the table comprise fees paid by the Group to Pacific Energy Partners
Pty Ltd.
Table 4 – Non-executive Directors’ Remuneration for the year ended 30 June 2022
Short-term*
Post employment*
Share-based payments**
Directors’
fees
Consulting
Fees
Superannuation
Loan Share
Plan Shares
Bonus
Shares
Director
B. White1
T. Louka2
T. Scholefield3
S. Oliver4
Totals
$
59,091
50,004
25,000
18,940
153,035
$
-
-
41,158
-
41,158
1. Mr B. White was Chairman for the whole period.
$
5,909
-
-
1,894
7,803
$
28,397
18,931
-
18,931
66,259
$
20,250
16,200
-
-
36,450
2. Mr T Louka is engaged through an associated company, Maxify Pty Ltd, to provide director services to the Company.
Total
$
113,647
85,135
66,158
39,765
304,705
27
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
3. Mr T. Scholefield is engaged through an associated company, Pacific Energy Partners Pty Ltd, to provide director services to the
Company. Mr Scholefield was an Executive Director until 31 December 2021. The above table reflects the non-executive director
fees and consulting fees (for services that are in addition to Non-executive Director responsibilities) for the period 1 January 2022
to 30 June 2022. Mr Scholefield’s share-based payments are captured in Table 2. A portion of the consulting fees was recoverable
by the Group under agreements with third parties.
4. Ms S. Oliver was appointed on 8 February 2022.
7. Share based compensation
Loan Share Plan Shares
On 8 February 2022, the Company issued 45,000,000 ordinary shares (Plan Shares) to Directors and
executives of the Company pursuant to the Loan Share Plan approved by shareholders at an extraordinary
general meeting held on 1 February 2022.
The Plan Shares are subject to the achievement of certain share price targets for ReNu Energy’s shares
(Target Price) as follows:
Vesting
Condition
Boyd
White
Tony
Louka
Tim
Scholefield
Susan
Oliver
Geoffrey
Drucker
Greg
Watson
Share
Target
Price*
Number of
Plan
Shares
Number of
Plan
Shares
Number of
Plan
Shares
Number of
Plan
Shares
Number of
Plan
Shares
Number of
Plan
Shares
Total Plan
Shares
$0.15
$0.25
$0.35
Total Plan
Shares
3,000,000
2,000,000
2,000,000
2,000,000
2,666,667
3,333,333
15,000,000
3,000,000
2,000,000
2,000,000
2,000,000
2,666,667
3,333,333
15,000,000
3,000,000
2,000,000
2,000,000
2,000,000
2,666,666
3,333,334
15,000,000
9,000,000
6,000,000
6,000,000
6,000,000
8,000,000
10,000,000
45,000,000
* The Target Price vesting condition will be satisfied where the Volume Weighted Average Price of the Company’s shares
over any 15 day trading period is at least the Target Price.
The Board may determine that Plan Shares vest if there is a change of control event.
Each recipient has been provided with a 10-year, limited recourse, interest-free loan to fund the acquisition
of the Plan Shares. The loan amount is calculated as $0.09 per Plan Share multiplied by the number of Plan
Shares and is repayable in certain circumstances, including when employment with the Company ceases.
The Company’s recourse against the employee is limited to the loan amount if the Plan Shares have vested,
or otherwise the transfer back to the Company of the Plan Shares to which the loan relates.
As the Company has no right to receive cash settlement for the loan (the directors and executive can elect
to forfeit the shares), no loan receivable has been recognised by the Company. The effect of the contractual
arrangements is equivalent to an option exercisable at the time of loan repayment at an exercise price of
$0.09 per share. As a result, the grant of Plan Shares has been valued using an option pricing model and the
fair value recognised in profit or loss over the expected vesting period.
No shares were issued under the Loan Share Plan during the financial year ended 30 June 2023.
28
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
The movements of Plan Shares, held directly, indirectly, or beneficially by each key management personnel
member, including their related parties during the financial year ended 30 June 2023 is set out in Table 5
below. No Plan Shares have vested at the end of the reporting period.
Table 5 – Loan shares affecting remuneration of directors and other KMP this financial year or
future financial years
Executive
B. White
T. Louka
Balance at
beginning of
period
(shares)
3,000,000
3,000,000
3,000,000
9,000,000
2,000,000
2,000,000
2,000,000
6,000,000
T Scholefield
2,000,000
S. Oliver
2,000,000
2,000,000
6,000,000
2,000,000
2,000,000
2,000,000
6,000,000
G Drucker
2,666,667
2,666,667
2,666,666
8,000,000
G. Watson
3,333,333
3,333,333
3,333,334
10,000,000
Total
45,000,000
Shares
granted
during the
reporting
period
(shares)
Fair value of
shares
granted at
grant date ($)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Shares
lapsed
during the
reporting
period
(shares)
Balance as at
the end of the
reporting
period
(shares)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,000,000
3,000,000
3,000,000
9,000,000
2,000,000
2,000,000
2,000,000
6,000,000
2,000,000
2,000,000
2,000,000
6,000,000
2,000,000
2,000,000
2,000,000
6,000,000
2,666,667
2,666,667
2,666,666
8,000,000
3,333,333
3,333,333
3,333,334
10,000,000
45,000,000
Grant date
Expiry
date
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
0.061
0.056
0.050
0.061
0.056
0.050
0.061
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
1/02/2022 1/02/2032
0.056
0.050
0.061
0.056
0.050
0.061
0.056
0.050
0.061
0.056
0.050
29
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
8. Other statutory disclosures
Related party transactions with Directors
The Group engaged Pacific Energy Partners Pty Ltd and White Lotus Solutions Pty Ltd (trading as New
Energy Capital) to provide consulting services.
Tim Scholefield is a Director and Principal of Pacific Energy Partners Pty Ltd. Consulting and Non-Executive
Director fees of $112,089 were paid to Pacific Energy Partners during the year (2022: 166,381). The material
terms of the engagement of Pacific Energy Partners are disclosed in section 4 of the Remuneration Report.
The key resource from White Lotus Solutions Pty Ltd is Boyd White. Consulting and Executive Director fees
of $47,125 were paid during the year (2022: $0). The material terms of the engagement of White Lotus
Solutions are disclosed in section 4 of the Remuneration Report.
At 30 June 2023 $22,345 was owing to Pacific Energy Partners Pty Ltd and $21,500 to White Lotus Solutions
Pty Ltd in relation to June 2023 consulting fees.
Geoffrey Drucker’s spouse, Ms Ingeborg Drucker, is employed as Group Communications Director of ReNu
Energy Limited. Gross wages and salaries (including superannuation) of $215,475 were paid to Ms Drucker
during the year (2022: $87,083).
Shareholdings of Key Management Personnel
The movements of the Company's ordinary shares, held directly, indirectly or beneficially by each Key
Management Personnel member, including their related parties during the financial year ended 30 June 2023
are set out in Table 6 below.
30
Directors’ Report (continued)
Remuneration Report (Audited) (continued)
Table 6 - Shareholdings of Key Management Personnel
Balance at
Beginning of
Period
1/07/2022
Acquired
Under private
placement1
On-market
purchase/
(disposal) of
shares
Shares
released from
escrow2
Balance at
End of Period
30/06/2023
Directors
B. White
- Unrestricted
- Unvested3
T. Louka
- Unrestricted
- Unvested3
T. Scholefield
- Unrestricted
- Unvested3
G. Drucker
1,083,333
9,000,000
318,500
6,000,000
901,931
6,000,000
-
6,000,000
S. Oliver
- Unrestricted
- Unvested3
Executives
G. Watson
- Unrestricted
- Unvested3
- Unrestricted
-
166,666
- Unvested2,3
77,087,916
250,000
100,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,433,333
9,000,000
318,500
6,000,000
901,931
6,000,000
17,271,978
17,438,644
(17,271,978)
59,815,938
-
-
-
6,000,000
-
-
-
-
-
-
-
-
-
1,043,333
500,000
(928,785)
-
614,548
10,000,000
-
-
-
-
10,000,000
117,522,894
Total
117,435,013
916,666
(828,785)
1.
2.
3.
Shares taken up under the Private Placement announced on 23 November 2022.
Shares issued to Mr Drucker and his spouse on the acquisition of Countrywide Hydrogen Pty Ltd subject to escrow commencing
8 February 2022: 100% for 12 months, 75% for 18 months and 50% for 24 months. 25% of the shares were released from
Escrow on 1 February 2023 and a further 25% on 1 August 2023.
Ordinary Shares issued under the Loan Share Plan are subject to vesting conditions – refer to section 6 of the Remuneration
Report for further details.
End of Remuneration Report (Audited)
31
Directors’ Report (continued)
Signed in accordance with a resolution of the Directors.
Boyd White
Chairman
Brisbane
18 September 2023
32
Tel: +61 7 3237 5999
Fax: +61 7 3221 9227
www.bdo.com.au
Level 10, 12 Creek St
Brisbane QLD 4000
GPO Box 457 Brisbane QLD 4001
Australia
DECLARATION OF INDEPENDENCE BY A J WHYTE TO THE DIRECTORS OF RENU ENERGY LIMITED
As lead auditor of ReNu Energy Limited for the year ended 30 June 2023, I declare that, to the best of
my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of ReNu Energy Limited and the entities it controlled during the year.
A J Whyte
Director
BDO Audit Pty Ltd
Brisbane, 18 September 2023
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of
BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
33
: Consolidated statement of profit or
loss and other comprehensive
income
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2023
Interest income
Other income
Total income
Personnel expenses
Other operating expenses
General & administrative expenses
Finance costs
Total expenses
Equity Accounted Share of Profit/(Loss)
Loss before income tax expense
Income tax (expense) / benefit
Loss after income tax expense
Other comprehensive income for the period
Total comprehensive loss for the period attributable to
the owners of the parent
Earnings Per Share attributable to the owners of the
parent
Basic and Diluted Loss per share from continuing
operations (cents per share)
Basic and Diluted Loss per share (cents per share)
Note
2023
$
2022
$
47,158
55,362
3A
2,973,235
87,540
3,020,393
142,902
3B
3C
3D
8
4
13
13
(2,040,170)
(1,479,584)
(1,213,828)
(652,177)
(1,009,957)
(831,464)
(3,558)
(4,220)
(4,267,513)
(2,967,445)
(78,141)
(1,325,261)
(2,824,543)
159,301
-
(1,165,960)
(2,824,543)
-
-
(1,165,960)
(2,824,543)
(0.29)
(0.29)
(1.03)
(1.03)
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with
the accompanying notes.
34
: Consolidated statement of financial
position
AS AT 30 JUNE 2023
Current assets
Cash and cash equivalents
Trade and other receivables
Prepayments
Total current assets
Non-current assets
Property, plant and equipment
Investments at fair value through profit or loss
Equity accounted investments
Intangibles
Total non-current assets
Total assets
Current Liabilities
Trade and other payables
Borrowings
Employee provisions
Total current liabilities
Non-current liabilities
Deferred tax
Employee provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Other reserves
Accumulated losses
Total equity
Note
2023
$
2022
$
18(A)
1,308,085
2,016,762
5
242,669
270,454
146,200
157,554
1,696,954
2,444,770
7
8
6
9
10
68,470
30,700
5,338,752
1,300,000
421,859
-
10,374,162
10,827,532
16,203,243
12,158,232
17,900,197
14,603,002
296,122
260,545
64,622
19,290
25,555
62,517
386,299
342,352
4
407,413
566,714
20,100
7,306
427,513
574,020
813,812
916,372
17,086,385
13,686,630
11
12
375,331,156
371,529,007
1,483,736
720,170
(359,728,507)
(358,562,547)
17,086,385
13,686,630
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
35
: Consolidated statement of cash
flows
FOR THE FINANCIAL YEAR ENDED 30
JUNE 2023
Operating Activities
Payments to suppliers and employees
Proceeds from R&D tax incentive
Payments for rehabilitation expenditure
Net Goods and Services Tax received (paid)
Interest received
Interest paid
Costs associated with investments made
Net cash flows used in operating
activities
Investing Activities
Investment in other entities
Investment in associate
Cash acquired on acquisition of subsidiary
Derecognition of joint venture funds
Net cash from / (used in) investing
activities
Financing Activities
Proceeds from issue of shares
Repayment of borrowings
Repayment of lease liabilities
Payment of additional lease bond
Transaction costs of share issues
Buy-back of unmarketable parcels of shares
Net cash flow provided by financing
activities
Net decrease in cash and cash
equivalents
Add: Opening cash and cash equivalents at
1 July
Note
2023
$
2022
$
(3,319,901)
(1,979,967)
-
-
41,295
634,061
(349,594)
(123,858)
46,973
55,317
-
(3,020)
(23,652)
(241,853)
18(B)
(3,255,285)
(2,008,914)
7
8
11
10
10
11
11
(1,095,000)
(500,000)
-
-
(1,275,000)
-
384,343
(141,732)
(1,595,000)
(1,032,389)
4,556,361
3,622,800
-
(76,168)
(125)
(338,460)
-
(106,162)
(57,148)
-
(442,508)
(427,126)
4,141,608
2,589,855
(708,677)
(451,448)
2,016,762
2,468,210
Cash and cash equivalents at 30 June
18(A)
1,308,085
2,016,762
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
36
: Consolidated statement of changes in
equity
FINANCIAL YEAR ENDED
30 JUNE 2023
At 1 July 2022
Loss for the period
Other comprehensive income
Total comprehensive income for the year
Transactions with owners in their capacity
as owners:
Shares issued
Exercise of options - listed
Share issue costs
Share based payment (note 15)
Share Based
Payment Reserve
Issued Capital
(Note 12)
Accumulated
Losses
Total Equity
$
$
$
$
371,529,007
720,170
(358,562,547)
13,686,630
-
-
-
4,555,000
1,361
(338,460)
(415,752)
-
-
-
-
-
-
763,566
(1,165,960)
(1,165,960)
-
-
(1,165,960)
(1,165,960)
-
-
-
-
4,555,000
1,361
(338,460)
347,814
At 30 June 2023
375,331,156
1,483,736
(359,728,507)
17,086,385
FINANCIAL YEAR ENDED
30 JUNE 2022
At 1 July 2021
Loss for the period
Other comprehensive income
Total comprehensive income for the year
Transactions with owners in their capacity
as owners:
Shares issued
Shares issued relating to business
combination
Buy-back of unmarketable parcels
Share issue costs
Share based payment (note 15)
Share Based
Payment Reserve
Issued Capital
(Note 12)
$
358,435,465
-
-
-
3,622,800
10,772,762
(427,126)
(442,508)
(432,386)
$
-
-
-
-
-
-
-
-
720,170
Accumulated
Losses
Total Equity
$
$
(355,738,004)
2,697,461
(2,824,543)
(2,824,543)
-
-
(2,824,543)
(2,824,543)
-
-
-
-
-
3,622,800
10,772,762
(427,126)
(442,508)
287,784
At 30 June 2022
371,529,007
720,170
(358,562,547)
13,686,630
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
37
Notes to the Financial Statements
Note 1 – Corporate information
The financial report of ReNu Energy Limited (the Company) and its subsidiaries (collectively the Group) for
the year ended 30 June 2023 was authorised in accordance with a resolution of the Directors on 18
September 2023.
ReNu Energy Limited is a for profit Company limited by shares, incorporated and domiciled in Australia whose
shares are publicly traded on the Australian Securities Exchange. The nature of the operations and principal
activities of the Group are described in the Directors’ Report.
Note 2 – Summary of significant accounting policies
A.
Basis of preparation
The financial report is a general purpose financial report which has been prepared in accordance with the
requirements of the Corporations Act 2001, Australian Accounting Standards and other authoritative
pronouncements of the Australian Accounting Standards Board. The financial report has also been prepared
on a historical cost basis.
B.
Compliance with IFRS
The financial report complies with Australian Accounting Standards and International Financial Reporting
Standards (IFRS) as issued by the International Accounting Standards Board.
C.
New or amended Accounting Standards and Interpretations adopted
The Group has adopted all of the new and revised Standards and Interpretations issued by the Australian
Accounting Standards Board (‘AASB’) that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early
adopted.
There were no standards that had any significant impact on the Group’s accounting policies.
D. Going Concern
The financial statements have been prepared on the going concern basis, which contemplates continuity of
normal business activities and the realisation of assets and settlement of liabilities in the normal course of
business.
As disclosed in the financial statements, the Group has net operating cash outflows for the year of $3,255,285
and as at 30 June 2023 has cash and cash equivalents of $1,308,085. The Group also generated a loss after
tax of $1,165,960.
Subsequent to year end, the Group paid the third tranche of $250,000 to acquire a further 5% interest in an
associate, Vaulta Holdings Pty Ltd. At the date of this report, the Group had $335,035 in cash and cash
equivalents.
The ability of the Group to continue as a going concern is dependent upon completing a successful capital
raise within the next four to six weeks. It is intended that the Company will undertake a capital raise by means
of a placement to sophisticated and institutional investors with the intention to raise up to $5,000,000. Steps
have already been undertaken towards completing this capital raise. The Directors believe completing a
successful capital raise within the timeframe is reasonable based on steps already undertaken and the
Company’s recent history in raising capital. The Group completed an oversubscribed private placement to
sophisticated and institutional investors on 29 November 2022, raising $4,530,000.
Upon completion of a successful capital raise, the ongoing ability for the Group to continue as a going concern
and meet its debts and commitments will be managed through the execution of the following:
38
Notes to the Financial Statements (continued)
•
•
Effective cash flow management.
Securing appropriate projects and related funding for project investment.
• Raising additional capital or securing other forms of financing, as and when necessary to meet the
levels of expenditure required for the Group to advance its strategy of investing in renewable and clean
energy technologies and developing green hydrogen projects.
These conditions give rise to material uncertainty which may cast significant doubt over the Group’s ability to
continue as a going concern.
The Directors are satisfied that the Group has access to sufficient funds to extinguish creditors and liabilities
in the ordinary course of business for at least the next 12 months from the date of signing this report and
accordingly have applied the going concern basis of accounting in preparing the financial statements.
Should the Group be unable to continue as a going concern, it may be required to realise its assets and
extinguish its liabilities other than in the ordinary course of business, and at amounts that differ from those
stated in the financial report. The financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the amounts or classification of liabilities and
appropriate disclosures that may be necessary should the Group be unable to continue as a going concern.
E.
Basis of consolidation
The consolidated financial statements comprise the financial statements of the Group as at 30 June 2023.
Subsidiaries are all entities which the Group controls. Control is achieved when the Group is exposed, or has
rights, to variable returns from its involvement with the investee and has the ability to affect those returns
through its power over the investee. Specifically, the Group controls an investee if and only if the Group has:
•
•
•
Power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities
of the investee).
Exposure, or rights, to variable returns from its involvement with the investee.
The ability to use its power over the investee to affect its returns.
The Group reassesses whether or not it controls an investee if facts and circumstances indicate that there
are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the
Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets,
liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the
consolidated financial statements from the date the Group gains control until the date the Group ceases to
control the subsidiary.
Profit or loss and each component of other comprehensive income (OCI) are attributed to the equity holders
of the parent of the Group and to the non-controlling interests. All intra-group assets and liabilities, equity,
income, expenses and cash flows relating to transactions between members of the Group are eliminated in
full on consolidation.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity
transaction. If the Group loses control over a subsidiary, it derecognises the related assets (including
goodwill), liabilities, non-controlling interest and other components of equity while any resultant gain or loss
is recognised in profit or loss. Any investment retained is recognised at fair value with the change in carrying
amount recognised in profit or loss. This fair value becomes the initial carrying amount for the purposes of
subsequently accounting for the retained interest as an associate, joint venture or financial asset.
39
Notes to the Financial Statements (continued)
Material controlled entity/subsidiaries
The consolidated financial statements include the financial statements of the ultimate parent company, ReNu
Energy Limited, and its controlled entities. Principal subsidiaries, all of which are incorporated in Australia,
are listed in the following table:
Name
Countrywide Hydrogen Pty Ltd (formerly
Countrywide Renewable Hydrogen Limited)
Principal activities
Hydrogen project origination
Countrywide Renewable Energy Pty Ltd
Dormant
Equity Interest %
2023
2022
100
100
100
100
Equity accounted investments
An equity accounted associate is an entity over which the Group has significant influence but not control or
joint control. Investments in associates are accounted for using the equity method. Under the equity method,
the share of the profits or losses of the associate is recognised in profit or loss and the share of the
movements in equity is recognised in other comprehensive income.
Investments in associates are carried in the statement of financial position at cost plus post-acquisition
changes in the consolidated entity's share of net assets of the associate. Goodwill relating to the associate
is included in the carrying amount of the investment and is neither amortised nor individually tested for
impairment. Dividends received or receivable from associates reduce the carrying amount of the investment.
When the consolidated entity's share of losses in an associate equals or exceeds its interest in the associate,
including any unsecured long-term receivables, the consolidated entity does not recognise further losses,
unless it has incurred obligations or made payments on behalf of the associate.
The consolidated entity discontinues the use of the equity method upon the loss of significant influence over
the associate and recognises any retained investment at its fair value. Any difference between the associate's
carrying amount, fair value of the retained investment and proceeds from disposal is recognised in profit or
loss.
The following entity has been included in the consolidated financial statements using the equity method:
Name
Vaulta Holdings Pty Ltd
Principal activities
Assembly and sale of batteries designed for
re-use and repair using patented battery
casing technology
Equity Interest %
2023
2022
10
-
F.
Property, plant & equipment
Property, plant and equipment is stated at cost less accumulated depreciation and any impairment in value.
Depreciation is provided on a straight-line basis on all property, plant and equipment. All classes are
depreciated over periods ranging from 3 to 25 years (2022: 3 to 25 years). The assets' residual values, useful
lives and amortisation methods are reviewed, and adjusted if appropriate, at each financial year end.
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. The carrying amount of any component accounted
for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to the
profit or loss during the reporting period in which they are incurred.
40
Notes to the Financial Statements (continued)
Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future economic
benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset
(calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is
included in profit or loss in the year the asset is derecognised.
G.
Impairment of non-financial assets
At each reporting date, the Group assesses whether there is any indication that an asset may be impaired.
Where an indicator of impairment exists, the Group makes a formal estimate of recoverable amount. Where
the carrying amount of an asset exceeds its recoverable amount the asset is considered impaired and is
written down to its recoverable amount.
Recoverable amount is the greater of fair value less costs to sell and value in use. It is determined for a cash-
generating unit (CGU). In assessing value in use, the estimated future cash flows are discounted to their
present value using a pre-tax discount rate that reflects current market assessments of the time value of
money and the risks specific to the asset or CGU.
Impairment losses are recognised in the profit or loss in the year the loss is recognised.
H.
Cash and cash equivalents
Cash and cash equivalents on the Statement of Financial Position comprise cash at bank and on hand and
short-term deposits with an original maturity of three months or less that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of change in value.
For the purposes of the Consolidated Statement of Cash Flows, cash includes cash on hand and in banks
and short-term deposits with an original maturity of three months or less, net of outstanding bank overdrafts.
I.
Contributed equity
Ordinary shares are classified as equity. Any transaction costs arising on the issue of ordinary shares are
recognised directly in equity as a reduction of the share proceeds received.
J.
Trade and other payables
Trade payables and other payables are carried at cost and represent liabilities for goods and services
provided to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes
obliged to make future payments in respect of the purchase of these goods and services.
K.
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 profit or loss over the period of the borrowings using the effective interest
method.
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 finance costs.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement
of the liability for at least 12 months after the reporting date.
Transaction costs of borrowings
Fees and other costs incurred in relation to the establishment of borrowing facilities are treated as transaction
costs to the extent that it is probable that some or all of the facility will be drawn down and are included in the
initial fair value of the financial liability. Costs for facilities which do not eventuate or for which the probability
of utilisation is not probable are expensed in profit or loss.
41
Notes to the Financial Statements (continued)
L.
Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a
past event, it is probable that an outflow of resources embodying economic benefits will be required to settle
the obligation and a reliable estimate can be made of the amount of the obligation.
If the effect of the time value of money is material, provisions are determined by discounting the expected
future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and,
where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision
due to the passage of time is recognised as a finance cost.
M.
Employee benefits
(i) Wages, salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled
within 12 months of the reporting date are recognised in other payables or provisions in respect of employees'
services up to the reporting date. They are measured at the amounts expected to be paid when the liabilities
are settled. Liabilities for sick leave are recognised when the leave is taken and are measured at the rates
paid or payable.
(ii) Long service leave
The liability for long service leave is recognised in the provision for employee entitlements. Long service leave
not expected to be settled within 12 months of the reporting date are measured at the present value of
expected future payments to be made in respect of services provided by employees up to the reporting date
using the projected unit credit method. 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.
(iv) Share-based payments
The Group provides benefits to employees (including Directors) in the form of share-based payment
transactions, whereby employees render services in exchange for shares or rights over shares (‘equity-settled
transactions’).
The cost of equity-settled transactions is determined by the fair value at the date when the grant is made
using an appropriate valuation model. That cost is recognised, together with a corresponding increase in
other capital reserves in equity, over the period in which the performance and/or service conditions are fulfilled
in employee benefits expense. The cumulative expense recognised for equity-settled transactions at each
reporting date until the vesting date reflects the extent to which the vesting period has expired and the Group’s
best estimate of the number of equity instruments that will ultimately vest.
The expense or credit recognised in the Statement of Profit or Loss and Other Comprehensive Income for a
period represents the movement in cumulative expense recognised as at the beginning and end of that period
and is recognised in employee benefits expense.
No expense is recognised for awards that do not ultimately vest, except for equity-settled transactions for
which vesting is conditional upon a market or non-vesting condition. These are treated as vesting irrespective
of whether or not the market or non-vesting condition is satisfied, provided that all other performance and/or
service conditions are satisfied.
When the terms of an equity-settled award are modified, the minimum expense recognised is the grant date
fair value of the unmodified award provided the original terms of the award are met. An additional expense is
recognised for any modification that increases the total fair value of the share-based payment transaction or
is otherwise beneficial to the employee as measured at the date of modification. When the award is cancelled
by the entity or by the counterparty any remaining element of the fair value of the award is expensed
immediately through the profit or loss.
42
Notes to the Financial Statements (continued)
N.
Income recognition
The Group’s primary income relates to contributions from the joint licensee for geothermal remediation.
Interest income
Interest income is recorded as the interest accrues, using the effective interest rate (EIR) in accordance with
AASB9. The EIR is the rate that exactly discounts the estimated future cash receipts over the expected life
of the financial instrument or a shorter period, where appropriate, to the net carrying amount of the financial
asset.
O. Government grants
Government Grants (including R&D tax incentives) are recognised at their fair value where there is
reasonable assurance that the grant will be received and all attaching conditions will be complied with.
Government grants relating to rehabilitation costs are recorded as an offset against expenditure. To the extent
the government grant is greater than the associated expenditure the residual amount is recorded as other
income.
When the grant relates to an expense item, it is recognised as income over the periods necessary to match
the grant on a systematic basis to the costs that it is intended to compensate. Where the grant relates to an
asset or liability, the fair value is credited to a deferred income account until such time as all conditions
associated with the grant are met. Once these conditions are achieved the credit is allocated to the relevant
asset or liability. The amount of the grant is then released to net income over the expected useful life (by way
of reduced depreciation or amortisation) of the relevant asset.
P.
Earnings per share
Basic earnings per share is determined by dividing the profit/(loss) after tax by the weighted average number
of ordinary shares outstanding during the financial period. Diluted earnings per share is determined by
dividing the profit/(loss) after tax adjusted for the effect of earnings on potential ordinary shares, by the
weighted average number of ordinary shares (both issued and potentially dilutive) outstanding during the
financial period.
Q.
Income tax
Current income tax
The income tax expense or credit for the period is the tax payable on the current period’s taxable income
based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and
liabilities attributable to temporary differences and to unused tax losses.
Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid
to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted
or substantively enacted at the reporting date in the countries where the Group operates and generates
taxable income.
Current income tax relating to items recognised directly in equity is recognised in equity and not in the
statement of profit or loss. Management periodically evaluates positions taken in the tax returns with respect
to situations in which applicable tax regulations are subject to interpretation and establishes provisions where
appropriate.
Deferred tax
Deferred tax is provided using the liability method on temporary differences between the tax bases of assets
and liabilities and their carrying amounts for financial reporting purposes at the reporting date.
Deferred tax liabilities are recognised for all taxable temporary differences, except:
• When the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a
transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss.
43
Notes to the Financial Statements (continued)
•
In respect of taxable temporary differences associated with investments in subsidiaries, associates and
interests in joint arrangements, when the timing of the reversal of the temporary differences can be
controlled and it is probable that the temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax
credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that
taxable profit will be available against which the deductible temporary differences, and the carry forward of
unused tax credits and unused tax losses can be utilised, except:
• When the deferred tax asset relating to the deductible temporary difference arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time of
the transaction, affects neither the accounting profit nor taxable profit or loss.
•
In respect of deductible temporary differences associated with investments in subsidiaries, associates
and interests in joint arrangements, deferred tax assets are recognised only to the extent that it is
probable that the temporary differences will reverse in the foreseeable future and taxable profit will be
available against which the temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that
it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax
asset to be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are
recognised to the extent that it has become probable that future taxable profits will allow the deferred tax
asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when
the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted at the reporting date.
Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred
tax items are recognised in correlation to the underlying transaction either in other comprehensive income or
directly in equity.
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current
tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same
taxation authority.
Tax benefits acquired as part of a business combination, but not satisfying the criteria for separate recognition
at that date, are recognised subsequently if new information about facts and circumstances change. The
adjustment is either treated as a reduction in goodwill (as long as it does not exceed goodwill) if it was incurred
during the measurement period or recognised in profit or loss.
R. Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
• where the GST incurred on a purchase of goods and services is not recoverable from the taxation
authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part
of the expense item as applicable; and
•
receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of
receivables or payables in the statement of financial position. Cash flows are included in the Statement of
Cash Flow on a net basis and the GST component arising from investing and financing activities, which is
recoverable from, or payable to, the taxation authority are classified as operating cash flows. Commitments
and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation
authority.
44
Notes to the Financial Statements (continued)
S.
Segment reporting
A business segment is a distinguishable component of the entity that is engaged in providing products or
services that are subject to risks and returns that are different to those of other business segments. Operating
segments are identified on the basis of internal reports that are regularly reviewed and used by the Board of
Directors in order to allocate resources to the segment and assess its performance and are reported in
note 24.
T.
Parent Entity financial information
The financial information for the parent entity, ReNu Energy, included in note 22, has been prepared on the
same basis as the consolidated financial statements.
U.
Comparative figures
When required by Accounting Standards, comparative figures are adjusted to conform to changes in
presentation for the current financial year.
V.
Rounding of amounts
The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors’ Reports)
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 Instrument to the nearest dollar.
W.
Financial Assets
Classification
The Group classifies its financial assets in the following measurement categories:
•
•
those to be measured subsequently at fair value (either through Other Comprehensive Income (OCI),
or through profit or loss); and
those to be measured at amortised cost.
The classification depends on the Group’s business model for managing the financial assets and the
contractual terms of the cash flows.
For financial assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI.
For investments in equity instruments that are not held for trading, this will depend on whether the group has
made an irrevocable election at the time of initial recognition to account for the equity investment at fair value
through other comprehensive income (FVOCI). The election is made on an investment-by-investment basis.
All other financial assets are classified as measured at fair value through profit or loss (FVPL).
The Group reclassifies debt investments when and only when its business model for managing those assets
changes.
Initial recognition and measurement
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual
provisions of the instrument. At initial recognition, the Group measures a financial asset at its fair value plus,
in the case of a financial asset not at fair value through profit or loss (FVPL), transaction costs that are directly
attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at FVPL are
expensed in profit or loss.
When the fair value of financial assets and liabilities differs from the transaction price on initial recognition,
the group recognises the difference as follows:
45
Notes to the Financial Statements (continued)
(a) when the fair value is evidenced by a quoted price in an active market for an identical asset or liability
(i.e.: a Level 1 input) or based on a valuation technique that uses only data from observable markets,
the difference is recognised as a gain or loss.
(b)
In all other cases, the difference is deferred and the timing of recognition of deferred day one profit or
loss is determined individually. It is amortised over the life of the instrument, deferred until the
instrument’s fair value can be determined using market observable inputs, or realised through
settlement.
Debt instruments
Subsequent measurement of debt instruments depends on the group’s business model for managing the
asset and the cash flow characteristics of the asset. The Group has cash and cash equivalents and trade
and other receivables as financial assets. Consequently, the measurement category most relevant to the
group is as follows:
• Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows
represent solely payments of principal and interest are measured at amortised cost. Interest income
from these financial assets is included in finance income using the effective interest rate method. Any
gain or loss arising on derecognition is recognised directly in profit or loss and presented in other
gains/(losses), together with foreign exchange gains and losses. Impairment losses are presented as
separate line item in the statement of profit or loss.
Equity instruments
Equity instruments are instruments that meet the definition of equity from the issuer’s perspective; that is,
instruments that do not contain a contractual obligation to pay and that evidence a residual interest in the
issuer’s net assets. The Group subsequently measures all equity investments at fair value through profit or
loss. Gains and losses on equity investments at FVPL are included in the ‘net gains/(losses) on financial
assets at fair value through profit or loss’ in the statement of profit or loss and other comprehensive income.
Impairment
The Group assesses on a forward-looking basis the expected credit losses associated with its debt
instruments carried at amortised cost. The impairment methodology applied depends on whether there has
been a significant increase in credit risk. For trade receivables, the Group applies the simplified approach
permitted by AASB 9, which requires expected lifetime losses to be recognised from initial recognition of the
receivables.
Derecognition other than modification
Financial assets, or portion thereof, are derecognised when the contractual rights to receive the cash flows
from the assets have expired, or when they have been transferred and either (i) the Group transfers
substantially all the risks and rewards of ownership, or (ii) the Group neither transfers nor retains substantially
all the risks and rewards of ownerships and the Group has not retained control.
X.
Right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured
at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease
payments made at or before the commencement date net of any lease incentives received, any initial direct
costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be
incurred for dismantling and removing the underlying asset, and restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the
estimated useful life of the asset, whichever is the shorter. Where the Group expects to obtain ownership of
the leased asset at the end of the lease term, the depreciation is over its estimated useful life. Right-of use
assets are subject to impairment or adjusted for any remeasurement of lease liabilities.
46
Notes to the Financial Statements (continued)
The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short-term
leases with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are
expensed to profit or loss as incurred. Right-of-use assets has been included in property, plant and equipment
in the statement of financial position.
Y.
Lease liabilities
A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised
at the present value of the lease payments to be made over the term of the lease, discounted using the
interest rate implicit in the lease or, if that rate cannot be readily determined, the Group's incremental
borrowing rate. Lease payments comprise of fixed payments less any lease incentives receivable, variable
lease payments that depend on an index or a rate, amounts expected to be paid under residual value
guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to
occur, and any anticipated termination penalties. The variable lease payments that do not depend on an
index or a rate are expensed in the period in which they are incurred.
Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts
are remeasured if there is a change in the following: future lease payments arising from a change in an index
or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When
a lease liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to profit or
loss if the carrying amount of the right-of-use asset is fully written down. Lease liability has been included in
borrowings in the statement of financial position.
Z.
Business combinations
The acquisition method of accounting is used to account for business combinations regardless of whether
equity instruments or other assets are acquired.
The consideration transferred is the sum of the acquisition-date fair values of the assets transferred, equity
instruments issued or liabilities incurred by the acquirer to former owners of the acquiree and the amount of
any non-controlling interest in the acquiree. For each business combination, the non-controlling interest in
the acquiree is measured at either fair value or at the proportionate share of the acquiree's identifiable net
assets. All acquisition costs are expensed as incurred to profit or loss.
On the acquisition of a business, the Group assesses the financial assets acquired and liabilities assumed
for appropriate classification and designation in accordance with the contractual terms, economic conditions,
the Group's operating or accounting policies and other pertinent conditions in existence at the acquisition-
date.
Where the business combination is achieved in stages, the Group remeasures its previously held equity
interest in the acquiree at the acquisition-date fair value and the difference between the fair value and the
previous carrying amount is recognised in profit or loss.
Contingent consideration to be transferred by the acquirer is recognised at the acquisition-date fair value.
Subsequent changes in the fair value of the contingent consideration classified as an asset or liability is
recognised in profit or loss. Contingent consideration classified as equity is not remeasured and its
subsequent settlement is accounted for within equity.
The difference between the acquisition-date fair value of assets acquired, liabilities assumed and any non-
controlling interest in the acquiree and the fair value of the consideration transferred and the fair value of any
pre-existing investment in the acquiree is recognised as goodwill. If the consideration transferred and the pre-
existing fair value is less than the fair value of the identifiable net assets acquired, being a bargain purchase
to the acquirer, the difference is recognised as a gain directly in profit or loss by the acquirer on the
acquisition-date, but only after a reassessment of the identification and measurement of the net assets
acquired, the non-controlling interest in the acquiree, if any, the consideration transferred and the acquirer's
previously held equity interest in the acquirer.
47
Notes to the Financial Statements (continued)
AA.
Intangible assets
Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at
their fair value at the date of the acquisition. Intangible assets acquired separately are initially recognised at
cost. Indefinite life intangible assets are not amortised and are subsequently measured at cost less any
impairment. Finite life intangible assets are subsequently measured at cost less amortisation and any
impairment. The gains or losses recognised in profit or loss arising from the derecognition of intangible assets
are measured as the difference between net disposal proceeds and the carrying amount of the intangible
asset. The method and useful lives of finite life intangible assets are reviewed annually. Changes in the
expected pattern of consumption or useful life are accounted for prospectively by changing the amortisation
method or period.
Goodwill
Goodwill arises on the acquisition of a business. Goodwill is not amortised. Instead, goodwill is tested
annually for impairment, or more frequently if events or changes in circumstances indicate that it might be
impaired, and is carried at cost less accumulated impairment losses. Impairment losses on goodwill are taken
to profit or loss and are not subsequently reversed.
Customer contracts
Customer contracts acquired in a business combination are amortised on a straight-line basis over the period
of their expected benefit, being their finite life of 5 years.
BB.
Impairment of non-financial 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 tested 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 of disposal 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 which are largely
independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial
assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment
at the end of each reporting period.
CC. Significant accounting judgements, estimates and assumptions
The carrying amounts of certain assets and liabilities are often determined based on judgement, estimates
and assumptions of future events. The key estimates and assumptions that have a significant risk of causing
a material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting
period are:
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees and directors by reference to the
fair value of the equity instruments at the date at which they are granted. The fair value is determined by
using either the Binomial or Black-Scholes model taking into account the terms and conditions upon which
the instruments were granted. The accounting estimates and assumptions relating to equity-settled share-
based payments will have no impact on the carrying amounts of assets and liabilities within the next annual
reporting period but may impact profit or loss and equity. Refer to note 15 for further information.
48
Notes to the Financial Statements (continued)
Impairment assessment of goodwill
The Group tests annually, or more frequently if events or changes in circumstances indicate impairment,
whether goodwill has suffered any impairment, in accordance with the accounting policy stated in note 2 BB.
The recoverable amounts of cash-generating units have been determined based on value-in-use calculations.
These calculations require the use of a number of key assumptions given the early stage of development of
the underlying projects. In assessing the impairment of goodwill arising from the acquisition of Countrywide
Hydrogen Pty Ltd during the prior period, the Group assessed Countrywide Hydrogen Pty Ltd to include three
cash-generating units being hydrogen development projects in Melbourne, Portland and Tasmania. It is not
possible to allocate the goodwill to the planned hydrogen projects on a non-arbitrary basis given the synergies
between the projects at this early stage of development. Because of this the recoverable amount of goodwill
was determined at the hydrogen operating segment level. Refer to note 6 for further information.
Impairment of non-financial assets other than goodwill
The Group assesses impairment of non-financial assets other than goodwill at each reporting date by
evaluating conditions specific to the Group and to the particular asset that may lead to impairment. If an
impairment trigger exists, the recoverable amount of the asset is determined. This involves fair value less
costs of disposal or value-in-use calculations, which incorporate a number of key estimates and assumptions.
Intangible assets – customer relationships
The Group determined that customer relationships that Countrywide Hydrogen Pty Ltd held at the time of
acquisition met the accounting criteria to be recognised as identifiable intangible assets. This involved
significant judgement regarding the nature of the relationships and took into consideration the memorandums
of understanding (MOUs) that had been entered into and that these are not potential contracts with new
customers, rather they illustrate that Countrywide Hydrogen Pty Ltd has information about the customer,
regular contact with them and the customer can make direct contact with the company. The valuation of the
customer relationship intangible asset was assessed by adopting an income-based methodology utilising an
estimate of discounted cash flows arising from the MOUs. The key assumptions were similar to those detailed
in note 6 for the impairment testing of goodwill.
Valuation of investments at fair value through profit or loss
Investments at fair value through profit or loss are investments in companies that are not publicly traded.
Determination of the fair value of these investments involves considerable judgement. Reference is made to
the price at which these companies most recently raised funds, along with consideration whether events or
circumstances have occurred subsequent to raising funds that is likely to result in a material change in the
fair value of the investment.
Classification of investments as associates
The Group recognises an investment as an associate, and therefore adopts equity accounting for the
investment rather than recognising at fair value through profit or loss, if the Group has significant influence
over the investment. Whether or not the Group has significant influence over an investment is a matter of
considerable judgement. Factors taken into consideration include the percentage of equity interest,
participation in policy-making decisions and representation on the board. If the percentage of equity interest
is greater than 20%, it is presumed that the Group has significant influence over the investment unless it can
be clearly demonstrated this is not the not the case. The converse applies.
At 30 June 2023 the group held a 10% interest in Vaulta Holdings Pty Ltd with an option to acquire an
additional 10% interest and to appoint a director to the board. It was considered that the Group does have
significant influence over Vaulta Holdings Pty Ltd for the year ended 30 June 2023.
49
Notes to the Financial Statements (continued)
Note 3A – Income
Other income
Recoupment of remediation costs
R&D tax incentive received1
2023
$
2022
$
29,483
48,412
- 14,098
Net fair value gains/(losses) on investments at fair value through profit or loss
2,943,752
-
Other income
1.
Total R&D incentive received or receivable is in relation to geothermal remediation activities
Note 3B – Personnel expenses
Loss before income tax has been determined after charging the following specific
items:
Personnel expenses
Termination payments
Share based payments1
1. Refer to note 15
Note 3C – Other operating expenses
Depreciation of operational plant & equipment
Hydrogen Project Advisory and Consultancy fees
Write down of geothermal assets
Amortisation expense
Impairment of goodwill
Investment & acquisition costs
-
25,030
2,973,235
87,540
2023
$
2022
$
1,575,434 1,191,800
116,922 -
347,814 287,784
2,040,170 1,479,584
2023
$
11,765
725,041
-
453,370
-
23,652
1,213,828
2022
$
2,282
58,994
165,215
183,833
-
241,853
652,177
50
Notes to the Financial Statements (continued)
Note 3D – General & administrative expenses
Governance
External advisory
Facility, IT and communications
Travel
Insurance
Depreciation on right of use asset
Investor and public relations
Other
Note 4 – Income tax
Income tax expense
2023
$
253,398
157,066
92,263
2022
$
241,179
162,487
48,004
84,431 35,653
155,137
70,753
177,522
19,387
153,222
56,697
88,901
45,321
1,009,957
831,464
2023
$
2022
$
The prima facie tax benefit on loss of 25.0% (2022 – 25.0%) differs from the
income tax provided in the financial statements as follows:
Prima facie tax benefit on loss
331,315 706,136
Tax effect of amounts which are not deductible (taxable) in calculating taxable
income:
Change in R&D incentive for the prior year1
Other income/(expenses)
Adjustments for current tax of prior periods
Deferred tax assets for tax losses and other temporary differences not
recognised
-
3,525
(117,375)
(176,912)
82,310
-
(136,949)
(532,748)
Income tax benefit / (expense)
159,301
-
1
Change in R&D incentive represents amounts received in excess of carrying receivable balances
51
Notes to the Financial Statements (continued)
Note 4 – Income tax (continued)
Income tax expense comprises:
Current tax
Deferred tax
Total income tax expense
Tax losses
(879,320)
1,038,621
(535,595)
535,595
159,301
-
2023
$
2022
$
Unused tax losses for which no deferred tax asset has been recognised1
269,704,568
263,864,332
Potential tax benefit at 25.0% (2022 – 25.0%)
67,426,142
65,966,083
Deferred income tax
Deferred income tax at the end of the reporting period relates to the following:
Deferred tax liabilities
Deferred tax liabilities not offset against deferred tax assets
(407,413)
(566,714)
Other deferred tax liabilities offset against deferred tax assets (A)
(743,454) 42,667
Total deferred tax liabilities
(1,150,866)
(524,047)
2023
$
2022
$
Deferred tax assets
Losses available for offset against future taxable income:
Company
Subsidiary
Other deferred tax asset
Total deferred tax assets (B)
Net deferred tax assets (A) + (B)
Deferred tax assets not recognised1
67,096,580
65,966,083
329,562
-
250,229
58,878
67,676,371
66,024,961
66,932,917
66,067,628
(66,932,917)
(66,067,628)
Recognised net deferred income tax assets
-
-
1 Deferred tax assets arising from tax losses and temporary differences are only brought to account to the extent that it offsets the
Group's deferred tax liabilities arising from temporary differences. As the Group does not have a history of taxable profits, the
deferred tax assets associated with tax losses and temporary differences in excess of the Group’s deferred tax liabilities arising from
temporary differences is not yet regarded as probable of recovery at 30 June 2023.When the Group does generate taxable profits,
the company will also need to consider at that point if it passes the continuity of ownership test or the same or similar business test.
52
Notes to the Financial Statements (continued)
Note 4 – Income tax (continued)
Movement in deferred tax assets
Balance at the beginning of the year
(Charged)/credited to profit or loss:
Tax losses
Trade and other payables
Provisions
Adjustment for deferred tax of prior periods
Change in tax rate
Balance at the end of the year
Movement in deferred tax liabilities
Balance at the beginning of the year
(Charged)/credited to profit or loss:
Leases
Intangible assets
Gain on financial assets
Adjustment for deferred tax of prior periods
Recognition of DTL of acquired entities
Change in tax rate
Balance at the end of the year
Note 5 – Trade and other receivables
Current
Cash held as security
Trade receivables
GST Receivable
Interest receivable
Other receivables and deposits
Total current trade and other receivables
2023
$
2022
$
66,024,960
68,188,722
937,992
535,595
109,109
(6,259)
610,569
(42,478)
(3,038)
(20,440)
(2,633,401)
67,676,371
66,024,960
2023
$
(524,047)
2022
$
(1,151)
(4,224)
(3,290)
113,343 45,958
(735,938)
-
- 1,105
-
(566,714)
-
44
(1,150,866)
(524,047)
2023
$
2022
$
150,211
150,052
13,249
24,105
52,369
65,400
41 19
55,063
2,614
242,669
270,454
53
Notes to the Financial Statements (continued)
Note 5 – Trade and other receivables (continued)
Assets pledged as security
Of the cash held as security $150,211 (2022: $150,052) for bank guarantees (refer note 19).
Foreign exchange, interest rate and liquidity risk
Information about the Group’s exposure to foreign exchange risk, interest rate risk and liquidity risk is provided
in note 21. Trade and other receivables are non-interest bearing.
Fair value and credit risk
The maximum exposure to credit risk at the reporting date is the carrying amount of each class of receivables
mentioned above. Refer to note 21 for more information on the risk management policy of the Group.
Impairment
The Group assesses impairment on a forward looking basis for its trade and other receivables carried at
amortised cost. The Group has applied the simplified approach to measuring expected credit losses, which
uses a lifetime expected loss allowance. To measure the expected credit losses, trade receivables have been
grouped based on days overdue. No expected credit loss has been recognised by the Group during the year.
Note 6 – Intangibles
Intangibles (including goodwill) at cost
Less: accumulated amortisation and impairment
Total Intangibles
Reconciliation of Intangibles
Customer relationships
Cost
Accumulated amortisation
Goodwill
Cost
Impairment
Carrying amount 30 June
Reconciliations
2023
$
2022
$
11,011,365
11,011,365
(637,203)
(183,833)
10,374,162
10,827,532
2,266,855
(637,203)
1,629,652
2,266,855
(183,833)
2,083,022
8,744,510
8,744,510
-
-
8,744,510
8,744,510
10,374,162
10,827,532
Reconciliations of the written down values at the beginning and end of the current and previous financial
year are set out below:
54
Notes to the Financial Statements (continued)
Note 6 – Intangibles (continued)
FINANCIAL YEAR ENDED 30 JUNE 2023
Balance at 30 June 2022
Additions through business combinations
Impairment of Assets
Amortisation Expense
Balance at 30 June 2023
FINANCIAL YEAR ENDED 30 JUNE 2022
Balance at 30 June 2021
Goodwill
$
Customer
relationships
$
Total
$
8,744,510
2,083,022
10,827,532
-
-
-
-
-
-
-
(453,370)
(453,370)
8,744,510
1,629,652
10,374,162
Goodwill
$
Customer
contracts
$
-
-
Total
$
-
Additions through business combinations
8,744,510
2,266,855
11,011,365
Impairment of Assets
Amortisation Expense
Balance at 30 June 2022
Impairment testing
-
-
-
-
(183,833)
(183,833)
8,744,510
2,083,022
10,827,532
The Group assessed Countrywide Hydrogen Pty Ltd to include three cash-generating units being hydrogen
development projects in Melbourne, Portland and Tasmania. Goodwill acquired through the prior period
business combination is monitored at the hydrogen operating segment level. This is the lowest level at which
the goodwill is monitored as it is not possible to allocate the goodwill to the planned hydrogen projects on a
non-arbitrary basis given the synergies between the projects at this early stage of development.
The proposed hydrogen development projects are as follows:
Location
Tasmania1 Melbourne
Portland
Project size 5MW facility 10MW facility 10MW facility
1. The Group plans to develop two 5MW facilities.
The recoverable amount of the Group’s goodwill has been determined by a value-in-use calculation using a
discounted cash flow model, based on a 20-year project life.
Key assumptions are those to which the recoverable amount of an asset or cash generating unit is most
sensitive. Each of the key assumptions has been based on a range of possible values reflecting an estimated
10%, 50% and 90% chance of occurring. The key assumptions in the following table were used in the
discounted cash flow model. The values disclosed in the table represent the mean of the range of possible
values.
Utilising the Company’s available carry forward tax losses has not been factored into the value-in-use
calculations.
55
Notes to the Financial Statements (continued)
Note 6 – Intangibles (continued)
Key assumption
Approach to determining the value assigned to the key assumption
Discount rate
Reflects management’s estimate of the time value of money and the Group’s expected weighted average
cost of capital, the risk-free rate and the volatility of the share price relative to market movements. It also
reflects that for the key assumptions, adjustments to the cash flows have been made to arrive at risk-adjusted
expected cash flows. A 16.3% cost of equity has been assumed.
Federal and State
grant funding
Takes into consideration government announcements of funding to be made available for projects and
funding already provided for other projects that don’t belong to the Group. Grant funding included in the
model was based on the project location and size as follows:
•
•
for a 5MW facility the mean value is $12.5 million.
for 10MW facility the mean value is $21.6 million.
Capital expenditure
Determined based on estimates provided by a global engineering consultancy engaged by the Company
working on similar projects and discussions/pricing from key equipment vendors. The capex assumptions
also include a contingency appropriate to the status of the project. Capital expenditure included in the model
was based on the project location and size as follows:
•
•
for a 5MW facility the mean value is $31.2 million.
for 10MW facility the mean value is $54 million.
Hydrogen sales
price
Depending on the use case for the facility, management considered the diesel displacement breakeven point
for heavy vehicles, business demand to decarbonise operations, the opportunity to blend hydrogen in natural
gas pipelines, conversations on expected price with potential customers and hydrogen sale prices in
overseas markets. A mean hydrogen sales price of $10.40/kg has been modelled for all development
projects.
Power price
Determined considering estimates of current behind-the-meter and national energy market peak and off-
peak power costs, potential project partner purchase price agreements and government subsidies. Power
price included in the model was based on the project location and supplier as follows:
•
•
for the Tasmania projects the mean value is $60/MWh.
for Melbourne and Portland projects the mean value is $74/MWh.
First hydrogen sales Determined considering the key milestones to be achieved before financial close and expected construction
timeframe based on discussions with the Company’s engineering consultant and considering current supply
chains. Although first sales may occur earlier, sales commencing during calendar years 2025 (for the
Tasmania) and 2027 (for the Melbourne and Portland) have been modelled.
Annual growth rate
An annual growth rate of 1.5% has been applied to expenditure and 2.5% to sales. The rate applied to
expenditure considers the long term supply contracts envisaged, the ability to achieve real savings through
synergies as multiple projects come online and operational efficiencies once commercial production is
reached. The sales escalation considers assessments on diesel price growth, including IEA forecasts and
road user charge increases applied to diesel fuel.
56
Notes to the Financial Statements (continued)
Note 6 – Intangibles (continued)
Sensitivity
Based on the above the recoverable amount of the cash generating units exceeded the carrying amount of
intangible assets by $2.6 million.
The Directors have made judgements and estimates in respect of impairment testing goodwill. Should these
judgements and estimates not occur the resulting goodwill carrying amount may decrease. The key
sensitivities are as follows:
• The discount rate would need to increase to 16.9% (a movement of 0.6%) before goodwill would need
to be impaired.
• Federal and State Government grant funding would need to be 3% less than the mean value modelled
across the projects before goodwill would need to be impaired.
•
•
•
•
•
If the mean value of capital expenditure across the projects increase by 3%, the carrying amount of
goodwill would need to be impaired.
If the mean value of the hydrogen price decreases by 1%, the carrying amount of goodwill would need
to be impaired.
If the mean value of the power price increases by 3%, the carrying amount of goodwill would need to be
impaired.
If the first hydrogen sales for the Tasmanian project were delayed by 9 months which in turn will delay
the first hydrogen sales for the Melbourne and Portland projects by 9 months, the carrying amount of
goodwill would need to be impaired.
If the gap between the annual growth rate in expenditure and the growth rate in sales decreases by 0.5%
then the carrying amount of goodwill would need to be impaired.
Note 7 – Investments at fair value through profit or loss
Investment in Uniflow Power Limited(1)
Investment in Enosi Australia Pty Ltd(2)
Investment in Allegro Energy Pty Ltd(3)
2023
$
2022
$
350,000
350,000
1,590,000
500,000
3,398,752
450,000
5,338,752
1,300,000
57
Notes to the Financial Statements (continued)
Note 7 – Investments at fair value through profit or loss (continued)
(1) Shares held in Uniflow Power Limited (Uniflow) with a fair value of $350,000, an Australian unlisted public company,
commercialising a micro renewable energy generator – The Cobber. The shares held equate to 5.0% of Uniflow equity.
(2) Shares held in Enosi Australia Pty Ltd (Enosi) with a fair value of $1,590,000. During year ended 30 June 2023 the Company
invested a further $1,000,000 at an issue price of $0.3511 per share. The Company assessed the fair value of the cumulative
investment at this share price generating a $90,000 gain on financial assets (Note 3A). Enosi is an Australian company that has
developed Powertracer, a grid-scale renewable energy trading and tracing solution. The shares held equate to 14% of Enosi
equity.
(3) Shares held in Allegro Energy Pty Ltd (Allegro) with a fair value of $3,398,752. Allegro is an Australian battery technology
company that has developed a water-based electrolyte for use in redox flow batteries and supercapacitors. Allegro raised an
additional $4 million in share capital in June 2023 at an issue price of $32/share. The total shares held by ReNu Energy equate
to a 4.86% interest. The Company has assessed the fair value of its cumulative investment at $28/share, after taking into account
the terms of the June 2023 capital raise. This generated a $2.854m gain on financial assets (Note 3A).
Note 8 – Equity Accounted Investments
Interests in associates
Name of entity
Vaulta Holdings Pty Ltd
Ownership interest
Carrying amount
2023
10%
2022
0%
2023
$
-
2022
$
-
Vaulta is a battery casing technology company based in Brisbane, Australia.
Refer to note 2CC for significant judgment/assumptions made in relation to equity accounting investments
where the Group own less than 20% ownership interest.
Subsequent to year end, the Group acquired a further 5% of the share capital of Vaulta Holdings Pty Ltd
bringing the total ownership interest at the date of this report to 15%.
58
Notes to the Financial Statements (continued)
Note 8 – Equity Accounted Investments (continued)
The following table illustrates the summarised financial information of the Group’s investment in Vaulta
Holdings Pty Ltd:
2023
$
223,741
149,300
373,041
122,888
-
122,888
250,153
25,015
396,843
421,859
2023
$
327,358
(781,414)
(781,414)
(78,141)
2023
$
-
500,000
(78,141)
421,859
2022
$
-
-
-
-
-
-
-
-
-
-
2022
$
-
-
-
-
2022
$
-
-
-
-
Summarised financial information for associate
Summarised Balance Sheet
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Equity
Reconciliation to carrying amount
Share of equity (10%)
Goodwill
Carrying amount of investment in associate
Summarised statement of comprehensive income
Revenue
Profit/(loss) before tax
Income Tax
Profit / (loss) after tax
Group’s share of profit / (loss) at 10%
Reconciliation of the consolidated entity's carrying amount
Opening carrying amount
Investment
Share of profit / (loss) after income tax
Closing carrying amount
59
Notes to the Financial Statements (continued)
Note 9 – Trade and other payables
Current
Trade creditors
Accrued and other liabilities
Trade creditors and accruals
Terms and conditions
2023
$
2022
$
105,683
190,439
296,122
143,437
117,108
260,545
Accounts payable and accrued liabilities are non-interest bearing. Liabilities are recognised for amounts to
be paid in the future for goods and services received, whether or not billed to the Company. All amounts are
normally settled within 30 days, and discounts for early payment are normally taken where it is considered
advantageous for the Company to do so. Due to the short-term nature of these payables, their carrying value
is assumed to approximate their fair value.
Note 10 – Borrowings
Current borrowings
Lease liability
Total current borrowings
Lease liabilities
2023
$
64,622
64,622
2022
$
19,290
19,290
Set out below are the carrying amounts of lease liabilities (included under borrowings) and the movements
during the period:
Changes in lease liabilities
2023
$
2022
$
At 1 July
Additions
Interest
Lease payments
At 30 June
Current
Non-current
19,290
117,942
3,558
(76,168)
64,622
64,622
-
64,622
14,369
60,870
1,199
(57,148)
19,290
19.290
-
19,290
The maturity analysis of lease liabilities are disclosed in Note 21.
Fair value of borrowings
The fair values of borrowings are not materially different from their carrying values as interest rates on those
borrowings are either close to current market rates or the borrowings are of a short-term nature.
60
Notes to the Financial Statements (continued)
Note 11 – Issued capital
Authorised Shares
2023
$
2022
$
440,502,123 (2022 – 364,566,012) fully paid ordinary shares
375,331,156
371,529,007
MOVEMENT IN ORDINARY SHARE CAPITAL:
NUMBER OF
SHARES
ISSUE PRICE
$ PER SHARE
30/06/21
Balance at end of financial year
132,762,923
$
358,435,465
9/12/2021 Share Issue(1)
8/02/2022 Share issue(2)
8/02/2022 Share issue(3)
8/02/2022 Share issue(4)
18/02/2022 Share issue(5)
21/04/2022 Share issue(4)
11/05/2022 Share buy-back (6)
30/05/2022 Share Issue (7)
26,400,000
0.09
2,376,000
1,800,000
0.081
145,800
45,000,000
124,680,158
13,853,318
9,979,362
(7,909,749)
18,000,000
-
-
0.08
9,974,413
0.09
1,246,800
0.08
0.054
798,349
(427,126)
Share issue costs – options issued to corporate
advisor and lead manager
Share issue costs
30/06/2022 Balance at end of financial year
29/11/2022 Share Issue(8)
2/12/2022 Exercise of Options - listed(9)
2/02/2023 Share issue(10)
364,566,012
75,500,000
19,445
416,666
0.06
0.07
0.06
Share issue costs – options issued to corporate
advisor and lead manager
Share issue costs
(578,186)
(442,508)
371,529,007
4,530,000
1,361
25,000
(415,752)
(338,460)
30/06/2023 Balance at end of financial year
375,331,156
(1) 26,400,000 shares issued on 9 December 2021 in respect of a private placement to sophisticated and institutional investors at
440,502,123
$0.09 per share.
(2) 1,800,000 bonus shares awarded to the Board and CEO in December 2021 and approved by shareholders on 1 February 2022.
The award was in recognition of work completed during 2021, including addressing long standing liabilities from previous
operations, achieving reduced operating costs, raising capital and implementing a strategy to be one of the only ASX listed
companies focussed on acquiring strategic stakes in and nurturing renewable and clean energy projects and technologies. The
shares were issued on 8 February 2022.
(3) 45,000,000 Loan Share Plan Shares (Plan Shares) issued to executives and Directors (pursuant to the terms of the Loan Share
Plan approved by shareholders at the Company’s 2017 annual general meeting) with vesting conditions that require the Company’s
share price achieving a price which represents a significant increase in shareholder value in relation to the share price at the time
that the Plan Shares were granted. The issue of the Plan Shares was approved by shareholders at the extraordinary general
meeting of the Company held on 1 February 2022 and the shares were issued on 8 February 2022.
(4) 134,659,520 ordinary shares issued to the shareholders of Countrywide Hydrogen Pty Ltd (CH) as consideration for the acquisition
of 100% CH (Consideration Shares), comprising 124,680,159 Consideration Shares were issued on 8 February 2022 today and
a further 9,979,361 Consideration Shares issued on 21 April 2022 to the three founders of CH following preparation of completion
accounts.
61
Notes to the Financial Statements (continued)
Note 11 – Issued capital (continued)
(5) 13,853,318 shares issued to eligible applicants under the Company’s Share Purchase Plan on 18 February 2022 at $0.09 per
share.
(6) 7,909,749 shares bought back under the Company’s unmarketable parcels buyback facility on 18 February 2022 at $0.054 per
shares.
(7) 18,000,000 shares issued as security for the Company’s At The Market (ATM) Facility with Acuity Capital (Collateral Shares) for
nil cash consideration. The Company may at any time cancel the ATM as well as buy back (and cancel) those shares for no cash
consideration (subject to shareholder approval). The ATM provides the Company with up to $5,000,000 of standby equity capital
until 31 July 2024.
(8) 75,500,000 shares issued on 29 November 2022 in respect of a private placement to sophisticated and institutional investors at
$0.060 per share.
(9) 19,455 shares issued on 2 December 2022 upon the exercise of 19,455 listed options at $0.070 each.
(10) 416,666 shares requiring shareholder approval, issued on 2 February 2023 in respect of a private placement to sophisticated and
institutional investors at $0.060 per share.
Terms and conditions of contributed equity
Ordinary Shares entitle their holder to one vote, either in person or by proxy, at a meeting of the Company.
Refer to note 15 for the terms and conditions of shares issued relating to Loan Share Plan.
Note 12 – Reserves
Share based payment reserve
Reconciliation of Reserves
Carrying amount at beginning
Net share-based payments expense recognised
Nature and purpose of reserves
Share based payment reserve
2023
$
2022
$
1,483,736 720,170
1,483,736
720,170
720,170
763,566
1,483,736
-
720,170
720,170
The employee share-based payment reserve is used to record the value of share loan plan shares granted
to employees and directors, including Key Management Personnel, as part of their remuneration. The share
based payment reserve also records the value of share options issued to Peak Asset Management, as
corporate advisor. Refer to note 15 for further details.
62
Notes to the Financial Statements (continued)
Note 13 - Earnings per share
Basic and diluted earnings/(loss) per share attributable to the equity
holders of the Company:
From continuing operations
From discontinued operations
The following reflects the income and share data used in the calculations of
basic and diluted earnings per share:
Net profit/(loss) attributable to equity shareholders:
From continuing operations
From discontinued operations
2023
Cents per share
2022
Cents per share
(0.29)
-
(0.29)
2023
$
(1.03)
-
(1.03)
2022
$
(1,165,960)
(2,284,543)
-
-
(1,165,960)
(2,824,543)
2023
Shares
2022
Shares
Weighted average number of ordinary shares used in calculation of basic
and diluted earnings per share
408,805,106
222,737,484
As the Group has generated a loss, potential ordinary shares have been deemed to be anti-dilutive.
Note 14 – Remuneration of Auditors
Auditors of the Group - BDO
Audit and review of the financial statements
Preparation of Independent Expert’s Report
Total services provided by BDO
2023
$
144,825
-
2022
$
76,298
90,000
144,825
166,298
During the year $nil (2022: $90,000) fees were paid or payable for non-audit services provided by the auditor
of the parent entity, its related practices and non-related audit firms.
Note 15 – Share based payments
Loan Share Plan Shares
For the year ended 30 June 2023, an amount of $347,814 has been recognised as a share-based payment
expense in the profit or loss (2022: $287,784) for shares issued to executives of the Company during the
year ended 30 June 2022 pursuant to the Loan Share Plan approved by shareholders at and Extra Ordinary
General meeting on 1 February 2022.
At the 2017 AGM, shareholders approved a Loan Share Plan (LSP) to retain, motivate and attract executives
and to better align the interests of employees with those of the Group and its shareholders by providing an
opportunity for employees to acquire shares subject to the terms and conditions of the LSP (Plan Shares).
63
Notes to the Financial Statements (continued)
Note 15 – Share based payments (continued)
The Plan Shares are issued or transferred to the participants in the LSP, determined by the Board in its
absolute discretion, at market value. The Group may provide a limited recourse loan to eligible employees
who are invited to participate in the LSP to assist them to purchase Plan Shares (Loan).
On 8 February 2022, the Company issued 45,000,000 ordinary shares (Plan Shares) to executives of the
Company pursuant to the Loan Share Plan approved by shareholders at an Extraordinary General Meeting
on 1 February 2022.
The Plan Shares will only vest if the executive has been employed for 6 months from the grant date and the
achievement of certain share price targets for ReNu Energy’s shares (Target Price) as follows:
Share Target Price*
Number of Plan Shares
$0.15
$0.25
$0.35
15,000,000
15,000,000
15,000,000
Total Plan Shares
* The Target Price vesting condition will be satisfied where the Volume Weighted Average Price of the Company’s shares
over any 15-day trading period is at least the Target Price.
45,000,000
Plan Shares will also vest if there is a change of control event.
Each recipient has been provided with a 10-year, limited recourse, interest-free loan to fund the acquisition
of the Plan Shares. The loan amount is calculated as $0.09 per Plan Share multiplied by the number of Plan
Shares and is repayable in certain circumstances, including when employment with the Company ceases.
The Company’s recourse against the employee is limited to the loan amount if the Plan Shares have vested,
or otherwise the transfer back to the Company of the Plan Shares to which the loan relates.
The issue price of the shares was $0.09 each with an aggregate loan value of $4.05 million.
Plan Shares
2023
Grant date
Exercise
price
Expiry
date
Balance at
the start of
the year
Number
Granted
during the
year
Number
Forfeited
during the
year
Number
01/02/2022
$0.090
01/02/2032
45,000,000
Weighted average fair value
$0.071
-
-
-
-
Balance at
the end of
the year1
Number
45,000,000
$0.071
1. No Plan Shares were exercisable at the end of the year and the weighted average remaining contractual life of the Plan Shares at
the end of the year was 8.59 years (2022: nil).
As the company has no right to receive cash settlement for the loan (the executive can elect to forfeit the
shares), no loan receivable has been recognised by the company. The effect of the contractual arrangements
is equivalent to an option exercisable at the time of loan repayment and at an exercise price of $0.09 per
share. As a result, the grant of shares under the Loan Share Plan has been valued at grant date using an
option pricing model and the fair value recognised in profit or loss over the expected vesting period.
64
Notes to the Financial Statements (continued)
Note 15 – Share based payments (continued)
Listed Options
•
12,500,000 listed options were issued on 1 February 2023 to Peak Asset Management for acting as
corporate adviser and lead manager to the November 2022 private placement.
The 12,500,000 listed options granted to Peak Asset Management are accounted for as a share-based
payment in respect of the services provided. The fair value at grant date is estimated using a Black
Scholes model, taking into account the terms and conditions upon which the options were granted.
The contractual life of each option granted is 1.1 years. There is no cash settlement of the options. The
fair value of options granted of $0.0333 per option was estimated on the date of grant, using the
following assumptions:
Exercise Price ($) 0.07
Dividend yield (%) nil
Expected volatility (%) 128
Risk-free interest rate (%) 3.19
Expected life of share options (years) 1.1
Share price ($) 0.067
An amount of $415,752 has been included in the statement of changes in equity for the year ended 30
June 2023 under ‘Share Capital’ (being a cost of raising capital) relating to the fair value of the options
granted to Peak Asset Management in November 2022.
• 75,916,666 listed options issued in two tranches (12,583,348 issued on 29 November 2022 and
63,333,318 issued on 1 February 2023) as part of the November 2022 share placement to professional
and sophisticated investors where subscribers received one (1) free attaching option for every share
subscribed for. The options have an exercise price of $0.07 per share and expire on 31 December 2023.
Share options outstanding at the end of the year have the following expiry dates and exercise prices:
Grant date
Expiry Date
Exercise Price
Share options 30
June 2023
Share Options 30
June 2022
$0.07
$0.07
$0.07
$0.07
$0.07
$0.07
20,756,872
6,600,000
5,000,000
3,463,403
12,583,348
75,833,318
20,776,317
6,600,000
5,000,000
3,463,403
-
-
124,236,941
35,839,720
0.5 years
1.5 years
30 August 2021
31 December 2023
10 December 2021
31 December 2023
1 February 2022
31 December 2023
18 February 2022
31 December 2023
29 November 2022
31 December 2023
1 February 2023
31 December 2023
Total
Weighted average remaining contractual life of options outstanding at
end of period
65
Notes to the Financial Statements (continued)
Note 16 – Key Management Personnel
Compensation of Key Management Personnel
Short-term employee benefits
Post-employment benefits
Share based payment expense
2023
$
2022
$
961,188
747,955
78,956
50,657
347,814
287,784
1,387,958
1,086,396
Further information on remuneration of KMP is shown in the Remuneration Report contained within the
Directors’ Report.
Note 17 – Related party disclosures
Related party transactions with Directors
The Group engaged Pacific Energy Partners Pty Ltd and White Lotus Solutions Pty Ltd (trading as New
Energy Capital) to provide consulting services.
Tim Scholefield is a Director and Principal of Pacific Energy Partners Pty Ltd. Consulting and Non-Executive
Director fees of $112,089 were paid to Pacific Energy Partners during the year (2022: $166,381). The material
terms of the engagement of Pacific Energy Partners are disclosed in section 4 of the Remuneration Report.
The key resource from White Lotus Solutions Pty Ltd is Boyd White. Consulting and Executive Director fees
of $47,125 were paid during the year (2022: $0). The material terms of the engagement of White Lotus
Solutions are disclosed in section 4 of the Remuneration Report.
Geoffrey Drucker’s spouse, Ms Ingeborg Drucker, is employed as Group Communications Director of ReNu
Energy Limited. Gross wages and salaries (including superannuation) of $215,475 were paid to Ms Drucker
during the year (2022; $87,083).
The above transactions are included in the following:
Personnel expenses
External Advisory
Hydrogen Project Advisory and Consultancy fees
Facility, IT and communications
Amounts included in Trade and other payables:
2023
$
2022
$
283,845
253,464
1,375
89,375
94
43,845
-
-
-
-
66
Notes to the Financial Statements (continued)
Note 18 - Notes to the Statement of Cash Flows
2023
$
2022
$
A. Reconciliation of cash
Cash balance comprises:
Cash at bank
Total cash
B. Reconciliation of the operating loss after tax with the net cash flows used in
operations
Loss after income tax
Depreciation and amortisation
Impairment of Goodwill
Share based payments expense
Equity Accounted Share of Loss
Write down of geothermal assets / PPE
1,308,085
2,016,762
1,308,085
2,016,762
(1,165,960)
(2,824,543)
535,887
242,811
-
347,814
287,784
78,141
-
1,339
165,215
Income tax expense/(benefit)
(159,301)
Items treated as cash flows from investing activities:
Net fair value gains/(losses) on investments at fair value through profit or
loss
(2,943,752)
-
-
Changes in Operating Assets & Liabilities
(Increase)/decrease in receivables and prepayments
Increase/(decrease) in other creditors and accruals
Increase / (decrease) in provisions
39,138
573,861
35,577
(470,474)
(24,168)
16,432
Net Cash Flow used in Operating Activities
(3,255,285)
(2,008,914)
Note 19 – Contingent liabilities
Bank guarantees
The Group’s bankers have issued bank guarantees as security for relevant Government authorities in respect
of tenement rehabilitation obligations of the Company: $150,211 (2022: $150,052).
As noted in note 5, these amounts are secured over cash deposits.
67
Notes to the Financial Statements (continued)
Note 20 – Subsequent events
Subsequent to year end, the Group acquired a further 5% of the share capital of Vaulta Holdings Pty Ltd
bringing the total ownership interest at the date of this report to 15%. No other matter or circumstance has
arisen since 30 June 2023 that has significantly affected, or may significantly affect the Group's operations,
the results of those operations, or the Group's state of affairs in future financial years.
Note 21 – Financial risk management
The Group’s principal financial instruments comprise cash, short-term deposits, borrowings investments in
equity shares at fair value through profit or loss. The Group has various other financial assets and liabilities
such as trade receivables and trade payables which arise directly from its operations. The Group does not
trade in financial instruments. The main risks arising from the Group’s financial instruments are credit risk,
liquidity risk and market risk (price risk).
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the
basis of measurement and the basis on which income and expenses are recognised, in respect of each class
of financial asset, financial liability and equity instrument are disclosed in note 2 to the financial statements.
Primary responsibility for identification and control of financial risks rests with the board of Directors, however
the day-to-day management of these risks is under the control of the Chief Executive Officer. The Board
agrees the strategy for managing future cash flow requirements and projections.
(A)
Credit risk
The Group’s maximum exposures to credit risk at balance date in relation to financial assets, is the carrying
amount of those assets as recognised on the reporting of financial position. There are no derivative financial
instruments currently being used by the Group to offset its credit exposure.
The Group trades only with recognised, creditworthy third parties for material transactions and as such
collateral is not requested nor is it the Group's policy to securitise its trade and other receivables. The Group’s
retail business does have exposure to small business customers for whom credit records may not be readily
available, however individual exposures have not been assessed as posing a material credit risk to the Group.
(B)
Liquidity risk
The Group’s objective is to maintain adequate capital to finance its current operations and near-term growth
opportunities while maintaining sufficient funds to meet its obligations in the event of a business downturn.
The Group plans to introduce conservative levels of debt financing to fund its growth plans, with repayment
profiles which match the expected cash flows from the relevant business operations. The Group’s financial
liabilities and their contractual maturities are:
Contractual maturities of financial liabilities
2023
Trade payables
Lease liabilities
Less than
6 months
$
105,683
24,591
Between 6
months & 1
year
$
Between 1
year & 2
years
$
Between 2
years & 5
years
$
Total
contractual
cash flows
$
Total
carrying
value
$
105,683
64,622
170,305
9,993 20,985
9,053
Total financial liabilities
130,274
9,993 20,985
9,053
68
Notes to the Financial Statements (continued)
Note 21 – Financial risk management (continued)
2022
Trade payables
Lease liabilities
Less than
6 months
$
143,437
14,800
Between 6
months & 1
year
$
Between 1
year & 2
years
$
Between 2
years & 5
years
$
Total
contractual
cash flows
$
-
-
-
463 973
3,054
Total financial liabilities
158,237
463 973
3,054
Total
carrying
value
$
143,437
19,290
162,727
(C) Market risk
Currency risk
The Group does not have any material exposure to foreign currency risk (2022: nil) but may cover the
expected cost of firm orders denominated in foreign currencies with forward contracts from time to time.
Interest rate risk
The Group’s cash balances are held in a combination of interest-bearing term deposits and bank accounts.
For each 10% movement in the interest rate, the Group’s profit/loss after tax would increase/decrease by
$13,00 if the year end cash balance was invested at those rates for 12 months.
The Group’s borrowings are at fixed rates of interest and there is no exposure to interest rate risk.
Equity Price Risk
The Group’s unlisted equity investments are susceptible to market price risk arising from uncertainty about
future values of the investment securities. The Group manages the equity price risk through diversification.
At the reporting date, the exposure to non-listed equity investments at fair value was $5,338,752. Sensitivity
analyses of these investments have been provided in note 23.
Note 22 – Information relating to ReNu Energy Limited (The Parent)
Current Assets
Total Assets
Current Liabilities
Total Liabilities
Contributed Equity
Accumulated Losses
Share Based Payment Reserve
Profit or (loss) of the Parent Entity
Total comprehensive income (loss) of the Parent Entity
69
2023
$
2022
$
1,474,543
2,133,345
18,005,691
14,618,751
(379,314)
(806,827)
(317,883)
(891,903)
375,331,156
371,529,007
(359,616,028)
(358,522,328)
1,483,736
720,170
17,198,864
13,726,849
(1,093,700)
(2,784,323)
(1,093,700)
(2,784,323)
Notes to the Financial Statements (continued)
Note 23 – Fair Value Measurement
Fair value hierarchy
The following tables detail the Group's assets and liabilities, measured or disclosed at fair value, using a
three-level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement,
being:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can
access at the measurement date
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly or indirectly
Level 3: Unobservable inputs for the asset or liability
Consolidated – 30 June 2023
Assets
Investments at fair value through profit or loss
Total assets
Level 1
$
Level 2
$
Level 3
$
Total
$
-
-
-
-
5,338,752
5,338,752
5,338,752
5,338,752
There were no transfers between levels during the financial half-year. The carrying amounts of trade and
other receivables and trade and other payables are assumed to approximate their fair values due to their
short-term nature.
Valuation techniques for fair value measurements categorised within level 2 and level 3
Unquoted investments in ordinary shares have been valued using the price at which the respective entities
most recently raised funds.
Level 3 assets and liabilities
Movements in level 3 assets and liabilities during the current financial year are set out below:
Consolidated – 30 June 2023
Balance at 1 July 2021
Additions
Net fair value gains/(losses) on investments at fair value
through profit or loss
Balance at 30 June 2022
Additions
Ordinary shares at fair value
through profit or loss
$
-
1,300,000
-
1,300,000
1,095,000
Total
$
-
1,300,000
-
1,300,000
1,095,000
Net fair value gains/(losses) on investments at fair value
through profit or loss
2,943,752
2,943,752
Balance at 30 June 2023
5,338,752
5,338,752
70
Notes to the Financial Statements (continued)
Note 23 – Fair Value Measurement (continued)
The level 3 assets and liabilities unobservable inputs and sensitivity are as follows:
Unobservable Inputs
Sensitivity
Share Price
10% change in share price of each investee company would
increase/decrease fair value by $533k
Note 24 - Segment Information
The Company operates in two segments: (i) hydrogen and (ii) renewable and clean energy investments. All
operations are located in Australia.
Operating segments are identified on the basis of internal reports that are regularly reviewed and used by the
CEO and Board of Directors (chief operating decision makers) in order to allocate resources to the segment
and assess its performance. The financial information presented to the chief operating decision makers uses
EBITDA as a measure to assess performance.
Unless otherwise stated, all amounts reported to the CEO and Board of Directors as the chief operating
decision makers are in accordance with the Group’s accounting policies.
The following table represents the Group’s segment information for the year ended 30 June 2023:
Year Ended 30 June 2023
Hydrogen
Revenue and income
- Other income
- Interest income
Expenses
EBITDA
Share of loss from associate
Income tax (expense)/benefit
Depreciation
Amortisation
Interest expense
$
-
-
(1,500,736)
(1,500,736)
-
159,301
(13,302)
(453,370)
(2,126)
Renewable &
Clean Energy
Investments
$
Corporate*
$
Total
$
2,943,752
29,483
2,973,235
-
47,155
47,155
(25,777)
2,917,975
(78,141)
-
-
-
-
(2,201,551)
(3,728,064)
(2,124,913)
-
-
(69,216)
-
(1,432)
(707,674)
(78,141)
159,301
(82,518)
(453,370)
(3,558)
Profit /(Loss) after tax
(1,810,233)
2,839,834
(2,195,562)
(1,165,960)
Assets
Segment assets
Unallocated assets
10,421,260
5,760,611
-
16,181,871
-
-
1,718,326
1,718,326
Total Assets
10,421,260
5,760,611
1,718,326
17,900,197
* Related to corporate overheads which cannot be attributable to each individual segment.
71
Notes to the Financial Statements (continued)
Note 24 - Segment Information (continued)
Year Ended 30 June 2022
Hydrogen
Revenue and income
- Other income
- Interest income
Expenses
EBITDA
Depreciation
Amortisation
Interest expense
$
-
-
(345,398)
(345,398)
-
(183,833)
-
Renewable & Clean
Energy Investments
$
Corporate*
$
-
-
87,540
55,362
Total
$
87,540
55,362
(41,916)
(2,333,099)
(2,720,413)
(41,916)
-
-
-
(2,190,197)
(2,577,511)
(58,979)
-
(4,220)
(58,979)
(183,833)
(4,220)
Profit /(Loss) after tax
(529,231)
(41,916)
(2,253,395)
(2,824,543)
Assets
Segment assets
10,827,532
1,300,000
-
12,127,532
Unallocated assets
Total Assets
-
-
2,475,470
2,475,470
14,603,002
* Related to corporate overheads which cannot be attributable to each individual segment.
72
: Directors’ declaration
In accordance with a resolution of the Directors of ReNu Energy Limited, I state that:
1.
In the opinion of the Directors:
The consolidated financial statements, comprising the consolidated statement of profit or loss and other
comprehensive income, consolidated statement of financial position, consolidated statement of changes in
equity, consolidated statement of cash flows and accompanying notes are in accordance with the
Corporations Act 2001, including:
(a) giving a true and fair view of the Group’s financial position as at 30 June 2023 and of its performance
for the period ended on that date; and
(b) complying with Australian Accounting Standards
(including
the Australian Accounting
Interpretations) and Corporations Regulations 2001;
(c)
(d)
the financial statements and notes also comply with International Financial Reporting Standards as
disclosed in note 2; and
there are reasonable grounds to believe that the Company will be able to pay its debts as and when
they become due and payable.
2. This directors have been given the declarations by the chief executive officer and chief financial officer
required by section 295A of the Corporations Act 2001. for the financial year ended 30 June 2023.
On behalf of the Board.
Boyd White
Chairman
Brisbane
18 September 2023
73
Tel: +61 7 3237 5999
Fax: +61 7 3221 9227
www.bdo.com.au
Level 10, 12 Creek St
Brisbane QLD 4000
GPO Box 457 Brisbane QLD 4001
Australia
INDEPENDENT AUDITOR'S REPORT
To the members of ReNu Energy Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of ReNu Energy Limited (the Company) and its subsidiaries (the
Group), which comprises the consolidated statement of financial position as at 30 June 2023, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement
of changes in equity and the consolidated statement of cash flows for the year then ended, and notes
to the financial report, including a summary of significant accounting policies and the directors’
declaration.
In our opinion the accompanying financial report of the Group, is in accordance with the Corporations
Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2023 and of its
financial performance for the year ended on that date; and
(ii)
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Material uncertainty related to going concern
We draw attention to Note 2(D) in the financial report which describes the events and/or conditions
which give rise to the existence of a material uncertainty that may cast significant doubt about the
group’s ability to continue as a going concern and therefore the group may be unable to realise its
assets and discharge its liabilities in the normal course of business. Our opinion is not modified in
respect of this matter.
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of
BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
74
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 of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters. In addition to the matter described in the Material uncertainty
related to going concern section, we have determined the matters described below to be the key audit
matters to be communicated in our report.
Impairment assessment of Intangible assets (including Goodwill)
Key audit matter
How the matter was addressed in our audit
The Group’s disclosures in respect to intangible
assets (including goodwill), detailing the
allocation of Goodwill to the Group’s cash
generating units (CGU’s), setting out the key
assumptions for the value-in-use calculations and
the impact of possible changes in these
assumptions would have on the impairment
assessment, is included in Note 6.
The carrying value of goodwill represents a
significant asset of the Group and is required to
be annually tested for impairment.
This annual impairment test was significant to our
audit because management’s assessment process,
including the determination of CGUs and
calculation of value-in-use calculations is
complex and highly judgmental as the cashflows
are based on a pre-revenue basis and pre-
development basis. Management’s assessment
process involves an extended period of
forecasting due to the nature of the project, and
includes estimates and assumptions relating to
expected future market or economic conditions.
The impact of inputs used in management’s
assessment required significant auditor attention.
Our procedures included, amongst others:
••
Evaluating management’s determination of
the CGU’s to ensure they are appropriate,
including being at a level no higher than the
operating segments of the entity
•• Obtaining and gaining an understanding of the
Group’s value in use models, testing the
mathematical accuracy and critically
evaluating management’s methodologies and
their key assumptions.
••
••
••
••
••
Evaluating the Group’s inputs used in the
value-in-use calculations, including those
relating to forecast revenue, costs, capital
expenditure, operation start dates and
discount rate.
Performing sensitivity analysis on the key
assumptions in the model. These included
hydrogen sales price, power price, operations
start dates and annual growth rates, grant
funding probability and discount rate.
Involving our internal specialists to assess the
discount rate applied against comparable
market information.
Involving our internal specialists to assess
management’s impairment assessment
process is in accordance with accounting
standards.
Evaluating the adequacy of the related
disclosures in the financial report.
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of
BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
75
Valuation of investments at fair value through profit or loss
Key audit matter
How the matter was addressed in our audit
The Group’s disclosures in respect of investments
at fair value through profit of loss, including how
the fair value of these investments is determined,
is included in Note 7 and Note 23.
The valuation of investments at fair value
through profit or loss was significant to our audit
because these investments are a significant asset
of the Group and determining the fair value can
involve significant judgement as the investments
are in companies that are not publicly traded.
Our procedures included, amongst others:
••
••
••
Evaluating the appropriateness of using the
most recent capital raise as a basis for
determining fair value, taking into
consideration the timing of the capital raise
and any special terms attached to the capital
raise
Considering management’s assessment of the
performance of the investment post the most
recent capital raise
Reviewing management’s assessment of
whether the Group is in a position to exercise
significant influence over the individual
investment.
Other information
The directors are responsible for the other information. The other information comprises the
information contained in the directors’ report for the year ended 30 June 2023, but does not include
the financial report and our auditor’s report thereon, which we obtained prior to the date of this
auditor’s report, and the annual report, which is expected to be made available to us after that date.
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
identified above 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 on the other information that we obtained prior to the date
of this auditor’s report, 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.
When we read the annual report, if we conclude that there is a material misstatement therein, we are
required to communicate the matter to the directors and will request that it is corrected. If it is not
corrected, we will seek to have the matter appropriately brought to the attention of users for whom
our report is prepared.
Responsibilities of the directors 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.
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of
BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
76
In preparing the financial report, the directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 15 to 27 of the directors’ report for the
year ended 30 June 2023.
In our opinion, the Remuneration Report of ReNu Energy Limited, for the year ended 30 June 2023,
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
BDO Audit Pty Ltd
A J Whyte
Director
Brisbane, 18 September 2023
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of
BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
77
: Corporate Governance &
Shareholder Information
The Board of Directors of ReNu Energy Limited is
responsible for the corporate governance of the
Company and are committed to achieving and
demonstrating the highest standards of corporate
governance.
ReNu Energy Limited’s corporate governance
practices were in place throughout the year ended
30 June 2023 and were fully compliant with the
Australian Securities Exchange Corporate
Governance Council’s Corporate Governance
Principles and Recommendations (4th Edition)
except for the following:
- Companies should
Recommendation 1.5
disclose in each annual report the measurable
objectives for achieving gender diversity set by the
Board in accordance with the diversity policy,
progress towards achieving them, and disclose at
the end of each reporting period the proportion of
women employees in the whole organisation,
women in senior executive positions and women
on the Board. The Company has adopted a
Diversity Policy that encourages the participation
to all people
and provision of opportunity
interested in working for the ReNu Energy group.
As the Company has a relatively small workforce
with many roles requiring specific skills that may
not be widely available, the Company:
•
•
has not deemed it appropriate to set specific
numeric
these could be
inappropriately skewed by the small sample
size; and
targets as
does not believe it appropriate to publish
the
specific employment numbers as
Company does not believe this information
adds any meaningful value due to its small
workforce.
Recommendation 2.5 – The Chair of the board of
a listed entity should be an independent director
and, in particular, should not be the same person
as the CEO of the entity. The Chairman was
appointed to an interim executive role effective 15
May 2023. The Company believes
the
appointment of Mr Boyd White to an interim
executive role is appropriate as Mr White is able to
bring, and does bring, quality
independent
judgment and project delivery expertise to work
with the Chief Executive Officer and Executive
Director to take the Company’s Tasmanian green
hydrogen projects to final investment decision.
ReNu Energy’s Corporate Governance Statement
can be downloaded in the Governance section of
our website
http://renuenergy.com.au/about-
us/governance/.
78
Distribution of Fully Paid Ordinary Shares
Analysis of number of equity holders by size and holding as at 13 October 2023.
Range
100,001 and Over
50,001 to 100,000
10,001 to 50,000
5,001 to 10,000
1,001 to 5,000
1 to 1,000
Total
Twenty Largest Holders
Securities % of issued capital
No. of holders
% of holders
375,548,111
29,088,313
34,226,198
3,577,857
859,972
201,672
84.68
6.56
7.72
0.81
0.19
0.05
443,502,123
100.00
487
378
1,440
419
322
668
3,714
13.11
10.18
38.77
11.28
8.67
17.99
100.00
Rank Name
Shares Held % of issued capital
1
2
3
4
5
6
7
8
9
10
11
12
12
13
14
15
16
17
18
19
20
GEOFFREY CHARLES DRUCKER
INGEBORG URSULA DRUCKER
STEPHEN MARK NOSSAL
10 BOLIVIANOS PTY LTD
ACUITY CAPITAL INVESTMENT MANAGEMENT PTY LTD
MR YAN ZHANG
GE-STAR PTY LTD
WHITE LOTUS SOLUTIONS PTY LTD
NORTH WESTERN SURVEYS PTY LTD
MR ANTHONY JAMES COTTER & MRS DEBORAH JOANNE COTTER
LOUKA MANAGEMENT PTY LTD
SUSAN OLIVER & CO PTY LTD
TIM SCHOLEFIELD
MR PATRICK KOK
CITICORP NOMINEES PTY LIMITED
MR NOEL RUSSELL CAMERON & DR BELINDA CAROLINE GOAD
MR GREGORY JOHN HOWLETT & MRS MARGARET WILHELMINA HOWLETT
BNP PARIBAS NOMINEES PTY LTD
INDEVCO GROUP HOLDINGS PTY LIMITED
SHARESIES NOMINEE LIMITED
RY-KIN CONSTRUCTIONS NO2 PTY LTD
42,627,291
34,627,291
29,205,696
22,375,037
18,840,000
10,300,000
10,000,000
9,000,000
8,999,255
8,449,123
6,200,000
6,000,000
6,000,000
3,000,000
2,690,639
2,664,159
2,500,000
2,208,343
2,157,888
2,074,045
2,000,000
9.61
7.81
6.59
5.05
4.25
2.32
2.25
2.03
2.03
1.91
1.40
1.35
1.35
0.68
0.61
0.60
0.56
0.50
0.49
0.47
0.45
Substantial Shareholders
The names of substantial shareholders who have notified the Company in accordance with 671B of the
Corporations Act 2001 are:
Total
231,918,767
52.29
Rank
Name
Shares held
% of issued capital
1
2
3
4
GEOFFREY CHARLES DRUCKER
INGEBORG URSULA DRUCKER
STEPHEN MARK NOSSAL
10 BOLIVIANOS PTY LTD
42,627,291
34,627,291
29,205,696
22,375,037
9.61
7.81
6.59
5.05
79
Voting Rights
Annual Report
The voting rights attaching to each class of equity
securities are set out below:
(a) Ordinary shares:
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.
(b) Options:
No voting rights.
Securities Exchange Listing
The shares of the Company are listed under the
symbol RNE on
the Australian Securities
Exchange Limited. The Company’s home branch
is Sydney.
Shareholder Enquiries
their
Shareholders with
shareholdings should contact the Company’s
Share Registry as follows:
queries
about
Link Market Services
Locked Bag A14
Sydney South NSW 1235
Telephone Australia: 1300 554 474
Telephone International: +61 1300 554 474
Fax +61 2 9287 0303
Email: registrars@linkmarketservices.com.au
Change of Address
Issuer sponsored shareholders should notify the
share registry immediately upon any change in
their address quoting
their Securityholder
Reference Number (SRN). This can be done by
phoning the share registry, by writing to them, or
at
through
www.linkmarketservices.com.au. Changes
in
addresses for broker sponsored holders should be
directed to the sponsoring brokers with the
appropriate Holder Identification Number (HIN).
portal
their
web
The Company’s Annual Report is posted on its
web site immediately upon release to ASX.
Shareholders will not be mailed a copy of the
Annual Report unless they have specifically opted
in to request one.
Notice of Meeting and Proxy Voting
The Company offers online
voting and
shareholders may elect to receive the Company’s
notice of meeting and proxy form via email. The
Company encourages this form of electronic
communication. Voting can be undertaken online,
by logging in to the Link website using the holding
details as shown on the proxy form. Shareholders
who do not register for online access will continue
to receive these documents by post. Shareholder
who would like to opt in to receive these
documents by email should
their
communication preferences at the share registry’s
web portal at www.linkmarketservices.com.au
register
Consolidation of Multiple Shareholdings
If you have multiple shareholding accounts that
you wish to consolidate into a single account,
please advise the Share Registry in writing. If your
holdings are broker sponsored, please contact the
sponsoring broker directly.
Register for Email Alerts
Please note, that as a shareholder you can
register through the ‘Email Alerts’ section of our
web site to receive electronic communications
from the Company. Registration will provide you
with an email advice with a
to
www.renuenergy.com.au each time a relevant
announcement is made by the company and
posted on this site. At www.renuenergy.com.au
shareholders can view:
link
•
•
•
Annual and half-year Reports
Securities Exchange Announcements
ReNu Energy Share Price Information
• General Shareholder Information
80
: Company Directory
BOARD OF DIRECTORS
Mr Boyd White (from 20 December 2019)
(Executive Chairman)
Tim Scholefield (from 6 December 2019)
(Non-executive Director)
Mr Tony Louka (from 5 October 2018)
(Non-executive Director)
Mr Geoffrey Drucker (from 8 February 2022)
(Executive Director)
Ms Susan Oliver (from 8 February 2022)
(Non-executive Director)
CEO AND COMPANY SECRETARY
Mr Greg Watson (from 28 February 2020)
PRINCIPAL AND REGISTERED OFFICE
Corporate House, Kings Row 1
Level 2, 52 McDougall Street, Milton, QLD 4064
Telephone: +61 7 2102 3654
POSTAL ADDRESS
PO Box 2046, MILTON QLD 4064
INTERNET
www.renuenergy.com.au
EMAIL
info@renuenergy.com.au
ABN
55 095 006 090
BANKER
Westpac Banking Corporation
AUDITOR
BDO Audit Pty Ltd
SOLICITOR
Thomson Geer Lawyers
SHARE REGISTRY
Link Market Services Limited
Phone: +61 1300 554 474
Fax: +61 2 9287 0309
Postal address: Locked Bag A14, Sydney South
NSW 1235
Website: www.linkmarketservices.com.au
Email: registrars@linkmarketservices.com.au
SECURITIES EXCHANGE LISTING
ReNu Energy Limited shares are listed on the
Australian Securities Exchange. Ticker: RN
81