Clearer SkieS
ahead
ANNUAL REPORT
FOr The FiNaNCial Year eNded 30 JUNe 2017
reGiONal eXPreSS hOldiNGS liMiTed
REGIONAL EXPRESS HOLDINGS LIMITED
1
REgiONAL ExPREss v ALUE sTATEmENT
fOREWORd
WhAT dOEs iT PROfiT A cOmPANy if iT gAiNs ThE WhOLE WORLd ANd LOsEs iTs sOUL
cOmPANy
Staff members are part of the Rex family. This comes with
both privileges and responsibilities.
We expect every staff member to take ownership of
issues encountered:
• Ownership means that if something is wrong then it is
everyone’s job to fix it.
• Matters that cannot be handled by the staff member
ought to be pursued further with senior management.
• Staff have the right to make mistakes if they act in
the best interest of the customer and the company.
We strive to be a learning organisation where we actively
seek to identify issues no matter how small in order to
continually transform ourselves to a better organisation:
• This entails a culture where issues are highlighted as
learning experiences even though they may place our
colleagues in a bad light.
• An excellent airline is one that is outstanding in a
thousand small ways.
We believe that we can only count on ourselves for our
continued success:
• All staff members must embrace the ‘can do’ and ‘will
do’ spirit that has been the defining characteristic of our
initial success.
• Hard work is the cornerstone of our work ethic.
• All staff share in the profits and so all staff are expected
to contribute his/her fair share.
We value open communication and will strive to create
an environment that removes barriers to communication:
• Staff members have a right to be heard regardless of
their position.
• Staff members are encouraged to contact directly the
members of the Management Committee and Board if
they see the need.
We respect the dignity of each staff member and will treat
each other with respect and fairness:
• The customer does not always come first and we
will stand by our staff member if the customer is
unreasonable.
• While we can be single-minded in tackling issues
and problems, we will focus on the issue and not
the person.
• We accept that staff members may have different
talents and capabilities and will strive to fit the job to
the person rather than the other way around.
• Important decisions concerning staff matters are
always referred to the Management Committee to
ensure transparency, fairness and consistency.
We are committed to standing behind our staff members
and their families and will do all we can to help them in
their times of special need:
• We believe in the value of the family and will strive to
create a working environment that is supportive of
the family.
• All staff members have the right to appeal to the
Management Committee if special assistance or
consideration is needed.
cUsTOmER
We are committed to providing our customers with safe
and reliable air transportation with heartfelt hospitality.
As a regional carrier, we constantly strive to keep fares
low through our commitment to simplicity, efficiency and
good value.
We are committed
treating our customers as
individuals and will respond to all their comments
and complaints.
to
cOmmUNiTy
Rex is mindful of the tremendous social and economic
impact its services have on the regional communities and
works in partnership with these communities to balance
their needs against Rex commercial imperatives.
We are also committed to giving back to the regional
communities by supporting worthwhile charitable causes
which are focused on helping the less fortunate.
We are committed to preserving the environment to the
measure of our capabilities.
cONTRAcTORs
We believe that our suppliers are partners in our business.
In all our dealings with suppliers we will seek to
be fair and honest and will strive to work only with
like-minded suppliers.
cAPiTAL
Rex believes that its shareholders’ interest is best served
by pursuing a path of steady but sustainable growth of
its earnings.
that maximizing shareholders’
We believe
returns
in the long term is not incompatible with our duties
and responsibilities towards our other stakeholders
outlined above.
cLEARER sKiEs AhEAd
This past Financial Year (FY) has again proven to be very
challenging for the aviation industry with Qantas, Air New
Zealand and Singapore Airlines all reporting significant
declines in Profit Before Tax (PBT) of 17 - 24%, while Virgin
Australia’s PBT losses came close to $300 million (M).
Fortunately for Rex, the situation is completely the
opposite and our operational results quadrupled with
a Profit Before Tax (PBT) of $17.8M compared to an
operational PBT of $4.3M for the previous FY. This
turnaround can be attributed to various factors, however
the main impetus for this solid outcome was the modest
recovery in passenger numbers (increase of 3% year on
year) across our extensive network of 58 destinations
encompassing every state. This pick-up is no doubt
reflective of the health of the general Australian economy
which has suffered almost six years of sharp decline
since 2010.
The tentative results of the first two months of this new FY
seem to confirm the trend of the prior FY. I am confident
that if the economy continues to recover, however
gradually, Rex will be able to continue to perform strongly.
With this renewed confidence in future prospects, the
Rex Board has decided to reward its long-suffering
shareholders with a generous dividend of 10 cents per
share.
I strongly commend the staff and management who have
proven that we can thrive under the most challenging
of situations. I am also grateful for the guidance of our
Board which comprises the most qualified and passionate
members one could ever hope for in the aviation industry.
Lim Kim Hai
Executive Chairman
29 August 2017
Lim Kim hAi
EXECUTIVE CHAIRMAN
N
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This annual report covers both Regional Express Holdings Limited as an
individual entity and the consolidated entity comprising Regional Express
Holdings Limited and its subsidiaries.
The Group’s functional and presentation currency is AUD ($).
diREcTORs
Lim Kim Hai
The Hon. John Sharp
Lee Thian Soo
Neville Howell
Chris Hine
James Davis
Prof. Ronald Bartsch
cOmPANy sEcRETARiEs
Irwin Tan
Benjamin Ng
Richard Kwan
REgisTEREd OfficE
81 – 83 Baxter Road
Mascot, NSW 2020
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(Fax): 02 9023 3599
shARE REgisTRy
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sOLiciTOR
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Level 27, AMP Centre
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BANKER
Westpac Banking Corporation
AUdiTOR
Deloitte Touche Tohmatsu
cONTENTs
55 diREcTORs’ REPORT
26 AUDITOR’S INDEPENDENCE
DECLARATION
27 cORPORATE gOvERNANcE sTATEmENT
35 fiNANciAL sTATEmENTs
36 CONSOLIDATED STATEMENT Of
PROfIT OR LOSS
37 CONSOLIDATED STATEMENT Of
OTHER COMPREHENSIvE INCOME OR LOSS
38 CONSOLIDATED STATEMENT Of
fINANCIAL POSITION
39 CONSOLIDATED STATEMENT Of
CASH fLOwS
40 CONSOLIDATED STATEMENT Of
CHANGES IN EqUITy
41 NOTES TO THE CONSOLIDATED
fINANCIAL STATEMENTS
74 DIRECTORS’ DECLARATION
75 iNdEPENdENT AUdiTOR’s REPORT
81 Asx AddiTiONAL iNfORmATiON
direCTOrS’
rePOr T
Photo Credit: Visit Outback Queensland
This PAgE hAs BEEN iNTENTiONALLy LEfT BLANK
1
BOARd Of diREcTORs
In compliance with the provisions of the Corporations Act 2001, the directors of Regional Express Holdings Limited (‘Rex’) submit herewith the
annual report for Rex and its consolidated entities (the ‘Group’) for the Financial Year ended 30 June 2017 (FY 17).
The names and particulars of the directors of Rex during or since the end of the FY are:
lim Kim HAi
executive Chairman
Appointed 27 June 2003 and
re-appointed 16 November 2006,
25 November 2009, 27 November 2012 and
27 November 2015.
tHe HoN. JoHN sHArP
Deputy Chairman and
independent Director
Appointed 14 April 2005 and re-appointed
19 November 2008, 23 November 2011,
27 November 2013 and 29 November 2016.
lee tHiAN soo
Non-executive Director
Appointed 27 June 2003 and re-appointed
16 November 2006, 25 November 2009,
27 November 2012 and 27 November 2015.
Mr. Lee has extensive international business
experience and currently is the Chairman
and owner of a company supplying specialty
medical devices, systems and drugs
to
healthcare institutions in the ASEAN region.
Mr. Lee was one of the founding shareholders
and directors of Rex in August 2002
Mr. Lim started his career as a Defence Engineer
specialising in underwater warfare. After 10
years he left to start his own business. Currently
he has a portfolio of investment and business
interests in diverse sectors and countries. He is
also the Chairman of a biomedical company in
Singapore, Lynk Biotechnologies Pte Ltd.
the prestigious
Mr. Lim obtained his Masters in Electronics
‘Grande
Engineering
from
Ecoles’ engineering colleges
in France
where he was sent on a French Government
scholarship. He later returned to France to
complete a Masters of Public Administration
at the elite Ecole Nationale d’Administration in
Paris on a Singapore Government scholarship.
Mr. Lim also has a Masters of Business
Administration from the National University
of Singapore.
Mr. Lim was one of the founding shareholders
and directors of Rex in August 2002. He has
been the Executive Chairman of the Rex Group
of companies since July 2003.
The Honourable John Sharp is an aviator, having
been a licensed pilot of both fixed wing and rotary
wing aircraft. Mr. Sharp was a member of the
House of Representatives of the Commonwealth
Parliament for 14 years (1984 – 1998). He retired
from the House of Representatives in 1998
and established his own high level aviation and
transport consulting company. Mr. Sharp is a
former Chairman of the Aviation Safety Foundation
of Australia. In 2001, he became a director of
Airbus Group, Australia Pacific, a position he
retired from in June 2015. He has retired as
Chairman of the Parsons Brinkerhoff Advisory
Board, an engineering and design company
operating throughout Australia and the region.
He is Chairman of Pel-Air Aviation Pty Ltd and is
also a director of Power and Data Corporation Pty
Limited and a director of Lurssen Australia. Mr.
Sharp is a Trustee and Board Member of John
McKeown House, Honorary Federal Treasurer,
National Party of Australia and has retired as
Chairman of Winifred West Schools Foundation.
He has been a member of the University of
Wollongong Vice Chancellor’s Advisory Board.
He is also currently a director of the Tudor House
Foundation. He was appointed a director of the
Flight Safety Foundation following his receipt of
the Foundation’s Presidential Citation for Aviation
Safety, the first Australian to receive this award.
He has also been a director of the French,
Australian Chamber of Commerce and Industry,
and Co-Chair of the Cancer Council of NSW
Southern Highlands Branch. He is currently a
director of the Climate Change Authority. Mr.
Sharp’s extensive experience in aviation, regional
air services and as the former Federal Minister
for Transport and Regional Development in the
Federal Government, adds significantly to the
expertise and standing of the Board.
JAmes DAvis
independent Director
Appointed 26 August 2004 as
Executive Director.
Appointed 23 November 2011 as an
Independent Director and re-appointed
26 November 2014.
Appointed Managing Director
on
27 May 2008 and retired 1 July 2011.
Engineering
in
Mr. Davis has a degree
Aeronautical
and
commenced his aviation career
with
the Civil Aviation Safety
Authority (CASA) before obtaining
his Air Transport Pilot Licence. He
flew with airlines
subsequently
in Australia and overseas
for
26 years, accumulating some
12,500 flying hours. He joined
Hazelton Airlines
in 1999 as
Flight Operations and Standards
Manager and later became Chief
Pilot. He has been with Rex since
its beginning in 2002, occupying
the positions of Executive General
Manager Operations, Managing
Director Operations, Chief of
Staff of the Chairman’s Office and
Managing Director. Mr. Davis is a
former Chairman of the Australian
Airline Pilot Academy Pty Ltd
(AAPA) and a former Director of
Rex Group companies Pel-Air
Aviation Pty Ltd and Air Link Pty
Ltd. He is currently Chairman of
the Regional Aviation Association
of Australia (RAAA).
ProF. roNAlD BArtsCH
independent Director
Appointed 23 November 2010 and
re-appointed 23 November 2011 and
26 November 2014.
Professor Bartsch has over 35 years’
experience in the aviation industry
in a variety of senior operational,
safety and
roles. He
regulatory
was head of safety and regulatory
compliance
for Qantas Airways
Limited’s AOC and manager of
the CASA Sydney Airline Transport
Field Office.
in
In addition, Professor Bartsch is an
experienced pilot and has extensive
regulatory experience.
legal and
Professor Bartsch has
formal
qualifications
law, education,
philosophy and science, and is the
author of the definitive legal textbook
on aviation law. Professor Bartsch
is an international aviation safety
consultant and senior visiting fellow
with the School of Aviation at the
University of New South Wales and
the College of Law at the Australian
National University. He is a former
aviation specialist member of the
Tribunal
Administrative Appeals
and author of several publications
including Aviation Law in Australia,
International Aviation Law and
Drones in Society.
CHris HiNe
Group Flight operations Advisor
Chairman, Australian
Airline Pilot Academy
Appointed 1 March 2011 as Executive
Director and re-appointed
23 November 2011.
Appointed 1 July 2014 as
Non-Executive Director and
re-appointed 26 November 2014.
Appointed Executive Director and
Group Flight Operations Advisor
18 May 2015.
Mr. Hine has over 25 years of
aviation experience including 15
years as a First Officer and Captain
of Metroliner and Saab 340 aircraft
and is a well-accomplished and
knowledgeable instructor. He has
been with the Company since its
inception in August 2002 and is the
Group Flight Operations Advisor,
Chairman’s Office and Chairman of
the Australian Airline Pilot Academy.
Prior to his current role he was
the Chief Operating Officer and
General Manager Flight Operations
and Chief Pilot. Prior to Rex he
worked for Kendell Airlines from
1995, during which time he held
various Check and Training Captain
positions. As Chief Operating
Officer he was responsible for the
Company’s operations
including
flight
operations, maintenance
control, airport operations and the
human factors group. Mr. Hine has
also had experience as a lecturer
in Cockpit Systems Management
for the Bachelor of Applied Science
(Civil Aviation) degree at
the
University of South Australia.
Neville Howell
Chief operating officer
Appointed 1 July 2014 as Executive
Director and re-appointed
26 November 2014.
Mr. Howell has over 36 years of
aviation experience and has been
with the Company since its inception
in August 2002. He has operated
the Saab 340 as a First Officer
and Captain for over 18 years for
both Hazelton Airlines and Regional
Express. Prior to his role as GM Flight
Operations (GMFO) and Chief Pilot,
Mr. Howell was Manager Training &
Checking and Deputy Chief Pilot.
He is an extensively qualified and
experienced simulator and aircraft
instructor and has held positions as
both Training and Check Captain. Mr.
Howell was the Chief Flying Instructor
and Chief Pilot for the first integrated
pilot training academy in Australia
and has provided cadet pilot training
for both domestic and international
carriers. He is a qualified lecturer in
a number of aviation subjects and
has a Diploma of Aviation. He holds
a number of Civil Aviation Safety
Authority (CASA) delegations and
has done since 1984. As GMFO
Mr. Howell was
for
all facets of the Company’s flight
operations and all operational
matters affecting the safety of flight
operations. Mr. Howell became
Chief Operating Officer in July 2014.
As Chief Operating Officer he is
responsible for Regional Express
operations including flight operations,
continuing airworthiness,maintenance
control, airport operations and
the human
factors group. Mr.
Accountable
the
is
Howell
Manager for the Regional Express
Air Operator Certificate (AOC).
responsible
7
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
8
2
sENiOR mANAgEmENT ExEcUTivEs
The names and particulars of the senior management executives of Rex during or since the end of the FY are:
Neville Howell
Chief operating officer
wArriCK loDGe
General manager, Network
strategy & sales
irwiN tAN
General manager, Corporate services
e
mAYoorAN
tHANABAlAsiNGAm
General manager,
information technology and
Communications
.PNG Yeow tA t
General manager,
engineering
mArK BurGess
Deputy General manager, engineering
DAviD BrooKsBY
National Airports manager
Chief operating officer, Air link
PAul FisHer
General manager, Flight operations
and Chief Pilot
Committee.
Neville is a member of the Rex
Management
A
description of his qualifications,
skills and experience is included
on page 8.
a
Warrick manages
team
responsible for scheduling, pricing,
revenue management, sales and
commercial analysis. His duties
include the monitoring of network
performance and analysis of
both existing and new market
opportunities. Warrick has more
than 25 years of regional airline
experience in the specialised areas
of scheduling, pricing and revenue
management and held the position
of Manager Network Planning with
Kendell Airlines, having joined that
company in 1992. Warrick has
been with Rex since its inception in
2002 and is also a member of the
Rex Management Committee
first
honours
Irwin’s background was originally in
genetic research after graduating
with
in
class
biotechnology from the University of
New South Wales in Sydney. Irwin
left the field of genetic research when
he joined Morrison Express Logistics
in 1999 and then Singapore Airlines
in 2001. He was later transferred
to Singapore Airlines Cargo as
an executive where he took on
various appointments in product
development, advertising, sales and
airline alliances before taking on the
role of Regional Marketing Manager
for the South West Pacific region in
2003. Irwin joined Rex in July 2005
and was appointed the Company
Secretary on 7 September 2005.
Irwin is also a member of the
Rex Management Committee.
Mayooran leads a team of Information
(IT)
Technology
professionals
responsible
for ensuring day-
to-day operations of the airline.
With over 15 years of experience
and an extensive background in
information
technology, he has
managed a range of IT projects
and initiatives for Rex including the
Internet Booking Engine, the Amend
Booking Engine, Web Check-in and
numerous Mobile/iPad applications.
Mayooran has a Master of Business
from
Administration
Charles Sturt University. He
also has a Graduate Certificate
in
(Information
Technology) as well as an Associate
Diploma of Electrical Engineering
/ Computer Engineering. He
commenced with Rex in April 2004.
Mayooran is a member of the Rex
Management Committee and a
Director of the Australian Airline Pilot
Academy (AAPA).
Management
(Computing)
from
Tat has been in aviation engineering
for more than 35 years and has
many years of experience in various
senior management
positions.
He graduated with an Honours
Degree in Electrical and Electronic
Engineering
the UK. Tat
joined Rex in June 2007 as the
Logistics Advisor and subsequently
as the Engineering Advisor in the
Chairman’s Office. He became the
Deputy General Manager and Part
145 Alternate Accountable Manager
for both Rex and Air Link Approved
Maintenance Organisations (AMOs)
in June 2013. He is a member of
the Rex Engineering Management
Committee and a member of the
Rex Management Committee.
Mark
is a Licensed Aircraft
Maintenance Engineer with over
30 years’ experience and has been
with the company since its inception
in 2002.
His career began as an apprentice
in the British Armed Forces where
he maintained helicopters for 12
years and left as a Senior Rank. He
continued his career in the oil and
gas industry with CHC Helicopters
and also British Midland Regional
Prop and Jet RPT services. He
migrated to Australia in 2001 to
work for Kendell Airlines in Wagga
Wagga and became Production
Leader co-ordinating maintenance
and manpower on heavy checks for
Saab 340 aircraft. In 2008 he moved
to Adelaide as the Line Maintenance
Supervisor and oversaw expansion
of Rex maintenance activities from
line to heavy maintenance. He is
a member of the Rex Engineering
Management Committee.
joining
commencing
David holds dual roles within the
company as both the National
Airports Manager
for Rex and
the Chief Operating Officer for
Air Link. David has held previous
senior roles in a management
and operational capacity at each
of Rex’s major airports including
Adelaide, Sydney, Brisbane and
Melbourne
the
since
in April 2006. Prior
company
to
employment
with Rex, David worked as a
contracted outport agent with
his family’s business at Mount
Gambier airport where his father
is the company’s longest standing
contracted ground handling agent,
having been contracted by Rex/
Kendell since 1982 to provide
ground handling services. David
graduated from the University of
South Australia with a Bachelor
of Management in 2003. David
is also a member of the Rex
Management Committee.
Paul has over 27 years of aviation
experience and has been with
the Company since its inception
in August 2002. He has operated
the Saab 340 as a First Officer
and Captain for over 14 years for
both Hazelton Airlines and Regional
Express. Prior to his role as GM
Flight Operations (GMFO) and Chief
Pilot, Paul served in various roles
within the Training and Checking
department along with being
the Adelaide Flight Operations
Standards
Flight
Manager,
the Training &
Manager and
Checking Manager
/ Deputy
Chief Pilot. He holds a number
of Civil Aviation Safety Authority
(CASA) delegations. As GMFO he
is responsible for all facets of the
Company’s flight operations and
all operational matters affecting the
safety of flight operations.
9
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
10
03 diREcTORshiPs Of OThER LisTEd cOmPANiEs
During the year under review, no directors appointed as at 30 June 2017 served as a director with any other company listed
on the ASX.
04 diREcTORs’ shAREhOLdiNgs
06 REmUNERATiON Of diREcTORs ANd sENiOR mANAgEmENT
Information about the remuneration of directors and senior management is set out in the remuneration report of this directors’ report, on
pages 21 to 24.
07 shAREs UNdER OPTiON OR issUEd ON ExERcisE Of OPTiONs
The following table sets out each director’s relevant interest in shares and options of Rex as at the date of this report. No debentures or
rights exist.
No options were granted or exercised in FY 17.
Fully paid ordinary shares
direct interest
Fully paid ordinary shares
indirect interest
Share options
08 fORmER PARTNERs Of ThE AUdiT fiRm
Directors
Lim Kim Hai
The Hon. John Sharp
Lee Thian Soo
Neville Howell
Chris Hine
James Davis
Ronald Bartsch
18,998,346
50,000
7,722,181
30,922
74,407
200,866
-
5,755,513
223,322
3,727,181
-
-
-
-
-
-
-
-
-
-
-
05 diREcTORs’ mEETiNgs
The following table sets out the number of directors’ meetings (including meetings of committees of directors) held during the FY and the
number of meetings attended by each director (while they were a director or committee member). During the FY, 4 Board meetings, 5
Remunerations, Nominations and Disciplinary Committee meetings, 2 Audit and Corporate Governance Committee meetings and 4 Safety
and Risk Management Committee meetings were held.
Directors
No. of Meetings Held:
Attendance:
Lim Kim Hai
The Hon. John Sharp
Lee Thian Soo
Neville Howell
Chris Hine
James Davis
Ronald Bartsch
Remunerations,
Nominations and
Disciplinary Committee
Board
Audit & Corporate
Governance Committee
Safety & Risk
Management Committee
4
4
3
3
4
4
4
4
5
-
5
-
-
-
5
-
2
-
2
-
-
-
2
-
4
-
-
-
-
4
-
4
No directors or officers in Rex or the Group have been a partner or director of Deloitte Touche Tohmatsu, the Group’s auditor.
09 cOmPANy sEcRETARiEs
Mr. Irwin Tan holds the position of Rex Company Secretary. A description of his qualifications, skills and experience is included
on page 9.
Mr. Benjamin Ng, having completed his Bachelor of Science followed by an MBA in the UK, started his career with the German multi-
national chemical company, Henkel in Malaysia. In his eight years with Henkel/Cognis, he held various positions ranging from sales,
marketing, business analysis and cost controlling. In 2001, he was posted to headquarters in Germany for just over a year where he was
cost controller for the Asia Pacific Region. Upon his return to Malaysia, he headed up the controlling department of Cognis for three years.
Benjamin joined Rex in April 2006 and was appointed Company Secretary on 10 October 2007.
Mr. Richard Kwan started his career with Rex after graduating with a Bachelor of Aviation (Hons) from the University of New South Wales
(UNSW). He has served various roles within the Corporate Services and Network Strategy & Sales departments focussed in analysis,
project and contract management within the Rex Group of companies including the Queensland & Western Australia regulated routes and
Pel-Air contracts. He has subsequently obtained a Master of Commerce from UNSW and has been certified as a PRINCE2 Practitioner.
Richard was appointed Company Secretary on 26 September 2016.
10 PRiNciPAL AcTiviTiEs
The Group’s principal activity during the FY was the provision of air services principally for the transportation of passengers and freight.
11
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REGIONAL EXPRESS HOLDINGS LIMITED
12
11 ORgANisATiON & gROUP sTRUcTUREs
REgiONAL ExPREss AiRLiNE ORgANisATiON sTRUcTURE
REgiONAL ExPREss gROUP hOLdiNgs sTRUcTURE
13
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
14
12 REviEW Of OPERATiONs
sUmmARy
At the commencement of FY 17 the Rex RPT network serviced 58 airports throughout all states of Australia. This follows Rex setting up
a new Western Australian base at Perth Airport in February 2016 to service the WA State Government regulated routes of Perth Albany
and Perth Esperance.
FY 17 was the first full year of Rex’s Western Australian operations and Rex has been extremely pleased with its decision to expand into
the west. Rex has worked closely with the WA Department of Transport, Perth Airport, the City of Albany and the Shire of Esperance to
grow passenger numbers and deliver reliable services to the benefit of all stakeholders. This included entering into unique partnership
agreements with Perth Airport, the City of Albany and the Shire of Esperance that provide airport cost certainty in return for Rex delivering
$129 Rex Community Fares on the Albany Perth and Esperance Perth routes.
In FY 17 partnership agreements were either renewed or entered into with the regional councils that own and operate the following
regional airports: Albany, Armidale, Bamaga (NPA), Bathurst, Ballina, Broken Hill, Ceduna, Coober Pedy, Esperance, Grafton, Mildura,
Moruya, Narrandera, Newcastle, Parkes, Snowy Mountains, Taree, Whyalla and Wagga Wagga.
There were no partnership agreements during the FY with the following regional airports: Albury, Burnie, Dubbo, Griffith, Kangaroo
Island, King Island, Lismore, Merimbula, Mount Gambier, Orange, Port Lincoln or any of the regional airports associated with the
Queensland regulated routes.
This FY saw an additional 16 Rex cadets inducted as First Officers (FOs), taking the number of former cadets flying in the Group to
136, of which 35 have already reached the rank of Captain. The maturity of the Rex cadet programme conducted at the Group’s pilot
training academy, the Australian Airline Pilot Academy (AAPA). continues to flourish and six former cadets have now achieved the rank
of Training Captain.
The Saab 340 Full Flight Simulator (FFS) located at AAPA continues to perform well and has high dispatch reliability given its heavy
demand for initial and recurrent pilot training. The FFS completed a total of 1,825 hours this FY and continues to provide significant
cost savings and operational efficiencies to the Group. The Civil Aviation Safety Authority (CASA) has renewed the Flight Simulator
Qualification Certificate until April 2018.
Rex has further developed and enhanced its in-house designed Electronic Flight Bag (EFB) across its 55 strong Saab 340 fleet in the
Rex Group. The EFB now provides access to the full suite of company and aircraft manuals which has allowed for the removal of hard
copy manuals. These initiatives and the continual development of in-house applications have resulted in significant operational and
safety enhancements to the Saab fleet and have provided greater convenience for the crew. All Rex pilots operating the Saab have been
issued with iPads containing the aforementioned manuals and applications for study purposes.
Following on from the training agreement with Viet Flight Training (VFT) and accreditations from the Civil Aviation Authority of Vietnam
and Vietnam Airlines in the previous FY, AAPA welcomed a further 18 Vietnamese cadets in four intakes from VFT and two intakes from
Vietnam Airlines.
After receiving CASA Commercial Pilot Licences and Command Instrument Ratings, the first seven Vietnamese cadets celebrated at
the inaugural graduation ceremony at AAPA on 12 May 2017. These cadets have returned to Vietnam to complete final training and
obtain a Vietnamese Commercial Pilot’s Licence and will be eligible to join Vietnam Airlines. This strong and successful relationship,
driven by Vietnam Airlines’ need for pilots, continues to grow with a further 21 cadets expected to have commenced training with AAPA
by September 2017.
AAPA’s first VFT graduating cadets with the Hon. Michael McCormack MP, Minister for Small Business, the Hon. Julie Bishop MP, Minister for Foreign
Affairs, NSW Consulate General of Vietnam, Minh Son Hoang and CEO of VFT, Captain Nam Lien Nguyen.
mATERiAL RisK ANd RisK mANAgEmENT
The Company recognises that it has a responsibility to conduct its activities in an environmentally and socially responsible manner.
The Group’s Environmental Management Program available on the Rex website details the Environmental Management Program (EMP),
incorporating the Group’s environmental policy, targets, prevention of pollution, management strategies to mitigate the risk of environmental
impact and continuous environmental improvement (ASX Recommendation 7.4).
Like all Australian airlines, the Company is subject to economic risks. The Company identifies the following risks that could adversely affect
the entity’s prospects for future FYs (ASX Recommendation 7.1):
• Fuel price – The Group was hedged for fuel for most of FY 17 which delivered significant savings to fuel cost. The Group continues
to closely monitor Brent Crude prices and has hedged its requirements to November 2017 with savings of close to $1M compared
to the prior period.
• Foreign exchange rates – The Group’s main financial risk is its exposure to the US dollar and hence its main objective is to minimise
the impact of USD fluctuation on its operations. However with significant purchases in spares in prior years, as well as the acquisition
of the majority of its fleet as opposed to leasing, the Group’s exposure to USD expenditure is reduced. The Group will continue to
monitor the exchange rate closely and will hedge whenever the rates are favourable.
The Company is also aware of the potential risk of the loss of pilots. In response, the Company began its own pilot cadet training
programme which has been operating successfully for nine years from its pilot training academy AAPA in Wagga Wagga NSW. As
mentioned earlier, more than half of the active pilot strength is from the programme and more and more Captains are also coming
from the programme now.
15
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
16
ROUTE NETWORK dEvELOPmENTs
The graphs below set out the evolution in monthly passenger carriage and monthly passenger revenue over the last eight FYs.
FY 17 was the first full year of Rex’s operations in Western Australia with services linking Albany and Esperance to Perth. It was also the
first full year of operating services between Sydney and the Snowy Mountains (Cooma).
Rex commenced operating the Perth Albany and Perth Esperance routes with effect from 28 February 2016 under a Deed of Agreement
with the Western Australian (WA) government. This confers onto Rex the sole right to operate on the Perth Albany and Perth Esperance
routes for a five year term beginning on 28 February 2016. This was a major milestone for Rex as it resulted in Rex establishing operations
in WA for the first time. From Perth, Rex operates 23 weekly return services to Albany and 18 weekly return services to Esperance.
Rex also commenced new services between Sydney and the Snowy Mountains (Cooma) in March 2016 in partnership with
Snowy Mountains Airport Corporation. This saw the Snowy Mountains air service operate throughout the first half of FY 17, which
included additional flight frequencies from July 2016 to October 2016 to accommodate the increased demand associated with the
Winter ski season.
In late October 2016, Rex, in partnership with the Northern Peninsula Area Regional Council (NPARC), expanded the week-day Cairns to
Bamaga schedule to include an additional non-stop service between Cairns and Bamaga each Sunday.
NPARC Mayor Eddie Newman (left) and Rex Queensland State Manager Steve Jones (right) in front of a Rex Saab 340 aircraft.
Also in late October 2016, Rex introduced an improved schedule between Cairns and Townsville. Rex has been operating services
between Cairns and Townsville since January 2015. The improved schedule was the result of listening to government and business
customers in both Cairns and Townsville which resulted in the reversal of the flight schedule to operate an earlier flight from Cairns to
Townsville in the morning, and a later flight from Townsville back to Cairns in the afternoon. This in turn provides the ability to undertake a
full day’s business in both cities with day-return travel made possible in each direction.
17
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
18
fLEET chANgEs
There were no changes to the fleet in the period under review. Of the 55 Saab 340 aircraft in the Rex Group, 38 are fully paid for, 15
are on mortgage with about two years left to run and two are on lease.
ENTERPRisE AgREEmENTs (EA)
13 chANgEs iN sTATE Of AffAiRs
No changes in the state of affairs were observed by the Group during the reporting period apart from what is reported in the Operational
Review.
The Rex Flight Attendant Enterprise Agreement (EA) and Airline Services Collective Agreement are currently being negotiated and have
a nominal expiry date of 30 June 2017. The Rex Pilot and Engineer EA were ratified in early FY 17.
14 sUBsEQUENT EvENTs
OPERATiONAL ANd sERvicE sTANd ARds
In FY 17 Rex recorded 83.8% on-time departure performance as reported by the Bureau of Infrastructure, Transport and Regional
Economics (BITRE).
In addition, Rex completed FY 17 with a low cancellation rate of 0.82%, which was the lowest cancellation rate of all Australian airlines.
Airline
QantasLink
Virgin Australia Regional Airlines
Qantas
Virgin Australia
Jetstar
Tigerair
on-time Departure
Cancellation rate (%)
FY 2017
FY 2016
FY 2017
FY 2016
4th
5th
2nd
1st
3rd
7th
6th
3rd
4th
6th
2nd
1st
7th
5th
0.8%
2.6%
1.5%
1.2%
2.2%
1.8%
1.3%
0.5%
2.6%
2.1%
1.1%
1.5%
2.2%
1.0%
cOmmUNiTy iNvOLvEmENT
Throughout FY 17 Rex contributed over $330,000 in
sponsorships to worthy charitable and community causes
across our regional network.
Rex is proud to be able to directly give back to the local
communities we service through corporate partnerships,
flight sponsorship, and very importantly, by providing fare
assistance to residents in our regional ports for travel to
capital cities for medical attention.
Some of the causes and events supported by Rex during
FY 17 are:
• Bedourie Splash ‘n’ Arts Camp
• Heart of Australia
• Birdsville Big Red Bash
• Taste Great Southern
• NSW Regional Woman of the Year Award
• Ballina Food and Wine Festival
• Peak Festival
• Parkes Elvis Festival
• Julia Creek Dirt n Dust Festival
Artists and crew heading to the Birdsville Big Red Bash.
Photo credit: Cathy Finch Photography
In July 2017, Rex announced it had been awarded the route licence to operate passenger services from Adelaide to Port Augusta by
the South Australian Government. Rex will be commencing services between Adelaide and Port Augusta from 11 September 2017.
The schedule will provide three weekly roundtrip services on Mondays, Tuesdays and Thursdays from Adelaide to Port Augusta and
return. This service will stimulate and provide ease of access to business and opens tourism to domestic and international visitors.
A further 21 Vietnamese cadet pilots are expected to commence training at AAPA over September and October 2017, with more expected
in the remainder of the FY.
Pel-Air has secured FIFO contracts with Iluka Resources and Cobham based out of Adelaide. The charter flights will commence in
July and August 2017 respectively and operate several times a week to Jacinth-Ambrosia and to Prominent Hill using the Saab 340
aircraft. The availability of Rex assets in Adelaide enabled Pel-Air to offer the charter services at short notice and clinch the contracts.
15 fUTURE dEvELOPmENTs
Rex Flight Operations and Information Technology departments are currently working on the development of a number of new
applications for the Electronic Flight Bag (EFB) for the Saab fleet in the Rex Group. The applications include flight planning, weight &
balance, performance and crew training. All of the associated applications and framework will provide greater operational efficiencies
and cost savings.
Rex is also looking to purchase/lease more aircraft as it sees a pick-up in RPT and charter activities.
16 ENviRONmENTAL REgULATiONs
During FY 17 Rex continued to be an active participant in programs aimed at maximising energy efficiency and reducing greenhouse
gas emissions in accordance with the National Greenhouse Energy Reporting Act 2007 (NGER).
Rex is due to submit its 8th NGER report to the Clean Energy Regulator in October 2017.
17 dividENds
In the light of a clear trend of the recovery of the Australian economy, the Directors have decided on a final dividend payout of 10
cents for every share to be paid out in November 2017.
18 iNdEmNificATiON Of OfficERs ANd AUdiTORs
During the FY, the Company paid a premium in respect of a contract insuring the directors of the Company (as named above), the
company secretaries (as named above), and all executive officers of the Company and of any related body corporate against a liability
incurred as such a director, secretary or executive officer to the extent permitted by the Corporations Act 2001. The contract of
insurance prohibits disclosure of the nature of the liability and the amount of the premium.
The Company has not otherwise, during or since the FY, except to the extent permitted by law, indemnified or agreed to indemnify an
officer or auditor of the Company or of any related body corporate against a liability incurred as such an officer or auditor.
19
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
20
19 REmUNERATiON REPORT
REmUNERATiONs, NOmiNATiONs ANd disciPLiNAR y cOmmiTTEE
Rex’s board of directors has established a Remunerations, Nominations and Disciplinary Committee for the purpose of determining
and reviewing compensation arrangements for the directors and the senior management executives of the Group. This committee
has a process for performance evaluation of the board, its committees and key executives of Rex. The committee’s role is to assess
the appropriateness of the nature and amount of remuneration of directors and senior management executives on a periodic basis.
REmUNERATiON POLicy
Remuneration levels are set to enable Rex and its subsidiaries to attract and retain appropriately qualified and experienced directors
and senior management executives, who will create sustainable value for shareholders and other stakeholders. They also fairly
and responsibly reward directors and senior management, having regard to the performance of the Group, the performance of the
individual and the external compensation environment.
REmUNERATiON sTRUcTURE
In accordance with best practice corporate governance, a distinction has been drawn between the remuneration structure of Rex’s
non-executive directors and that of its senior management executives. This enables Rex to maintain the independence of non-
executive directors and reward senior management executives for their performance of duties and their dedication.
Rex has set in place a remuneration model for all staff which calls for staff accepting a lower fixed annual salary increase in exchange
for a profit share and a share plan.
• Profit Share Incentive Plan
The profit share incentive scheme, established eleven years ago continues to award eligible employees a share of Rex’s profit
before tax (PBT) based on an agreed percentage (excluding contributions from subsidiaries and associates) for the FY immediately
preceding the award. The profit share is allocated on an equal share basis. Permanent part time employees receive an amount
proportional to their employment hours. The Board continues to offer this to all non-Enterprise Agreement (EA) employees who are
not the subject of an adverse recommendation by the Remunerations, Nominations and Disciplinary Committee.
• Share Gift Plan
Rex established the share gift plan (effective from FY 06) for its executive directors and eligible employees. The plan is offered
to EA groups that opt for the plan and all non-EA employees who are not the subject of an adverse recommendation by the
Remunerations, Nominations and Disciplinary Committee. This plan is not based on any performance measures (other than
eligibility for non-EA employees). The plan was established to show its recognition of employees’ contribution to Rex by providing
an opportunity to share in its future growth and profitability and to align the interests of the employees more closely with the
interests of the shareholders. As such, the share gift plan entitles eligible employees to a fixed value of shares in exchange for a
percentage of their base salaries. Therefore there are no vesting conditions attached to the share gift.
During the FY 2,855,365 fully paid ordinary shares were acquired by the Rex Tax Exempt Employee Share Plan Trust and Rex
Tax Deferred Employee Share Plan Trust which are managed by Rex Investment Holdings in accordance to the Rex Tax Exempt
Employee Share Plan Trust Deed and Rex Tax Deferred Employee Share Plan Trust Deed. The shares purchased are solely
for the benefit of employees as part of the employee share plan. The Group does not have a beneficial interest in the trust.
diREcTOR ANd sENiOR mANAgEmENT dETAiLs
The following persons acted as directors of the Company during or since the end of the FY:
Lim Kim Hai (Chairman)
The Hon. John Sharp (Deputy Chairman)
Lee Thian Soo
Neville Howell
Chris Hine
James Davis
Prof. Ronald Bartsch
The term ‘senior management’ is used in this remuneration report to refer to the following persons. Except as noted, the named
persons held their current position for the whole of the FY and since the end of the FY:
Neville Howell (Chief Operating Officer)
Warrick Lodge (General Manager, Network Strategy & Sales)
Irwin Tan (General Manager, Corporate Services / Company Secretary)
Mayooran Thanabalasingam (General Manager, Information Technology and Communications)
Png Yeow Tat (General Manager, Engineering)
Mark Burgess (Deputy General Manager, Engineering)
Paul Fisher (General Manager, Flight Operations & Chief Pilot)
David Brooksby (National Airports Manager, Rex & Chief Operating Officer, Air Link. David was appointed to the Rex Management Committee
on 1 July 2017)
21
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
22
REmUNERATiON Of diREcTORs ANd sENiOR mANAgEmENT
The directors and other nominated key management personnel received the following amounts as compensation for their services
as directors and executives of the Company and/or the Group during the year:
Short-term benefits
Cash salary
& fees
Cash profit
sharing &
other bonuses
$
-
-
$
-
-
FY
2017
2016
Post
employment
benefits
Long-term
benefits
Share gift
provision
Pension &
super-annuation
Long service
leave
Share gift
issued
$
-
-
$
-
-
$
-
-
Total
$
-
-
2017
135,643
16
12,887
1,760
2,113
152,419
Directors/Executives
eXeCutive DireCtors
lim Kim HAi (1)
Executive Chairman
CHris HiNe
Excecutive Director & Group Flight Operations
Advisor
2016
141,960
-
13,486
2,172
618
158,236
Neville Howell
2017
209,876
25,019
19,005
3,247
3,849
260,996
Executive Director & Chief Operating Officer
2016
215,259
-
19,029
3,205
3,800
241,293
GArrY Filmer
Alternate Director to Chris Hine until 12 Jan 2016
2016
49,389
-
4,692
2,000
823
56,904
NoN-eXeCutive DireCtors
JoHN sHArP
Deputy Chairman
lee tHiAN soo
Non-Executive Director
roNAlD BArtsCH
Non-Executive Director
JAmes DAvis
Non-Executive Director
2017
90,000
-
8,550
-
-
98,550
2016
93,461
-
8,879
-
-
102,340
2017
30,000
-
-
-
-
30,000
2016
31,154
-
-
-
-
31,154
2017
35,000
-
3,325
-
-
38,325
2016
36,346
-
3,453
-
-
39,799
2017
40,000
-
3,800
-
-
43,800
2016
41,538
-
3,946
-
-
45,484
seNior mANAGemeNt eXeCutives
wArriCK loDGe
2017
166,249
25,019
GM, Network Strategy & Sales
2016
170,350
-
irwiN tAN
2017
181,249
25,019
GM, Corporate Services
2016
185,927
-
mAYoorAN tHANABAlAsiNGAm
2017
171,249
25,019
GM, ITC
2016
175,542
-
PAul DAviD FisHer
2017
184,619
33,642
GM, Flight Operations & Chief Pilot
2016
189,173
30,139
PNG Yeow tAt
GM, Engineering
mArK BurGess
Deputy GM, Engineering
DAle HAll
2017
156,938
25,019
2016
2017
2016
154,999
-
136,688
18,284
129,252
16,438
16,443
16,183
17,485
17,663
16,790
16,677
17,718
18,135
15,797
14,725
14,391
13,841
2,770
2,735
2,770
2,735
2,770
2,735
3,284
213,765
3,242
192,510
3,284
229,807
3,242
209,567
3,284
219,112
3,242
198,196
4,618
3,647
244,244
4,559
2,615
2,581
3,419
3,375
3,600
245,606
3,100
203,469
2,853
175,158
2,700
175,482
2,400
165,306
GM, Engineering until 8 Jan 2016
2016
134,385
-
9,151
1,229
2,906
147,671
totAl
2017
2016
1,537,511
177,037
1,748,735
46,577
146,191
159,860
23,969
25,261
1,909,969
27,326
26,726
2,009,224
(1) Lim Kim Hai undertook to forfeit his Director’s fee since November 2008 in response to the global economic crisis and continued to do so in this reporting period in the light of the continuing difficult environment.
vALUE Of OPTiONs issUEd TO diRE cTORs ANd ExEcUTivEs
No options lapsed, were granted or were exercised during FY 17.
RELATiONshiP BETWEEN ThE REm UNERATiON POLicy ANd cOmPANy PERfORmANcE
In addition to the profit share and share gift schemes that apply to all non-EA staff, a Key Manager bonus, fixed by the Remunerations,
Nominations and Disciplinary Committee, was given to selected members of executive management based on an assessment of the
recipient’s performance during the year.
The tables below set out summary information about the Group’s results and movements in shareholder wealth for the five years
to June 2017:
Revenue
Net profit / (loss) before tax
Net profit / (loss) after tax
Share price at start of year
Share price at end of year
Interim dividend
Final dividend 1,2
Basic earnings / (loss) per share
Basic earnings / (loss) per share
30 June 2017
$’000
30 June 2016
$’000
30 June 2015
$’000
30 June 2014
$’000
30 June 2013
$’000
280,967
17,810
12,620
261,906
(10,703)
(9,557)
256,217
9,296
6,672
253,336
10,662
7,725
258,311
19,177
14,018
30 June 2017
30 June 2016
30 June 2015
30 June 2014
30 June 2013
$0.77
$1.11
-
-
11.7 cps
11.7 cps
$1.04
$0.77
-
-
(8.8 cps)
(8.8 cps)
$0.75
$1.04
-
-
6.2 cps
6.2 cps
$1.125
$0.75
-
-
7.0 cps
7.0 cps
$1.07
$1.125
-
-
12.8cps
12.8cps
1 The final dividend is per share fully franked and after corporate tax of 30%.
2 Declared after the balance date and reflected in the financial statements of the year of payment.
KEy TERms Of EmPLOymENT cONTRAcTs
Employment contracts between the senior management executives and the Group do not have a specified duration. A notice of four
weeks must be given for senior management executives to terminate their contract. There are no extraordinary termination payments
set out in the contracts of the senior management executives of the Group.
KEy mANAgEmENT PERsONNEL EQUiTy hOLdiNgs
The following table details the shareholdings (total of direct and indirect shareholdings) of directors and key management personnel in the
Group:
Balance at
1 July 2016
Increase / (Decrease)
during the year
Balance at
30 June 2017
Directors:
Lim Kim Hai
The Hon. John Sharp
Lee Thian Soo
Neville Howell
Chris Hine
James Davis
Key management personnel:
Warrick Lodge
Irwin Tan
24,653,859
200,000
11,449,362
25,857
176,628
200,866
151,027
26,811
100,000
61,322
-
5,065
(102,221)
-
4,321
4,321
24,753,859
261,322
11,449,362
30,922
74,407
200,866
155,348
31,132
Mayooran Thanabalasingam
79,389
4,321
83,710
Paul Fisher
Png Yeow Tat
Mark Burgess
David Brooksby
35,256
4,798
40,054
20,565
4,079
24,644
14,452
3,589
18,106
16,503
2,964
19,467
During the financial year, no options were granted to (2016: nil), nor exercised (2016: nil) by key management personnel for ordinary
Rex shares. No options remained unpaid or to be exercised at the year end.
23
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
24
20 PROcEEdiNgs ON BEhALf Of ThE cOmPANy
No proceedings have been brought on behalf of the Group, nor has any application been made in respect of the Group under s.237
of the Corporations Act 2001.
AUdiTOR’s iNdEPENdENcE dE cLARATiON
21 NON-AUdiT sERvicEs
Details of amounts paid or payable to the auditor for non-audit services provided during the year by the auditor are outlined in Note
26 to the financial statements.
The directors are satisfied that the provision of non-audit services, during the year, by the auditor (or by another person or firm on the
auditor’s behalf) is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001.
The directors are of the opinion that the services as disclosed in Note 26 to the financial statements do not compromise the external
auditor’s independence, based on advice received from the Audit Committee, for the following reasons:
• all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of the auditor,
and
The Board of Directors
Regional Express Holdings Limited
81 – 83 Baxter Road
MASCOT NSW 2020
• none of the services undermine the general principles relating to auditor independence as set out in Code of Conduct APES 110
Code of Ethics for Professional Accountants issued by the Accounting Professional & Ethical Standards Board, including reviewing
or auditing the auditor’s own work, acting in a management or decision-making capacity for the company, acting as advocate for the
company or jointly sharing economic risks and rewards.
29 August 2017
Dear Board Members
Deloitte Touche Tohmatsu
A.B.N. 74 490 121 060
Grosvenor Place
225 George Street
Sydney NSW 2000
PO Box N250 Grosvenor Place
Sydney NSW 1220 Australia
Tel: +61 (0) 2 9322 7000
Fax: +61 (0) 2 9322 7001
www.deloitte.com.au
22 ROUNdiNg Off Of AmOUNTs
In accordance with Legislative Instrument 2016/191 issued by the Australian Securities and Investments Commission relating to the
rounding off of amounts in the financial statements, amounts in the financial statements have been rounded to the nearest hundred
thousand dollars in accordance with that Legislative instrument, unless otherwise indicated.
Signed in accordance with a resolution of directors made pursuant to s.298 (2) of the Corporations Act 2001.
On behalf of the Directors
Neville Howell
Chief Operating Officer
Sydney, 29 August 2017
Regional Express Holdings Limited
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide
the following declaration of independence to the directors of Regional Express Holdings
Limited.
As lead audit partner for the audit of the financial statements of Regional Express
Holdings Limited for the financial year ended 30 June 2017, I declare that to the best of
my knowledge and belief, there have been no contraventions of:
(i) the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
(ii) any applicable code of professional conduct in relation to the audit.
Yours sincerely
DELOITTE TOUCHE TOHMATSU
Jamie Gatt
Partner, Chartered Accountants
25
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
26
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Touche Tohmatsu Limited.
COrPOraTe
GOVerNaNCe
STaTeMeNT
cORPORATE gOvERNANcE sTATEmENT
The Board is committed to sound corporate governance to ensure shareholder expectations are met and that Regional Express
Holdings (the Company) is in compliance with the Australian Securities Exchange (ASX) Corporate Governance Council’s Principles
of Good Corporate Governance and Best Practice Recommendations (ASX Recommendations).
As required by the ASX Listing Rules this statement sets out the extent to which the Company has complied with the ASX
Recommendations during the FY to 30 June 2017 and identifies any of the ASX Recommendations not followed and the
reason why the Company has not adopted the ASX Recommendations. This statement adopts the ordering and numbering
of the ASX Recommendations.
PRiNciPLE 1: LAy sOLid fOUNdATiON fOR mANAgEmENT ANd OvERsighT
The Board has adopted a charter that details the roles and responsibilities of the Board and those of the Management Committee
to achieve the objectives of delivering shareholder value. The Board regularly reviews the division of functions between the Board
and management to ensure that it continues to be appropriate to the needs of the company (ASX Recommendation 1.1). The
Remunerations, Nominations and Disciplinary Committee undertake appropriate checks before appointing a person, or putting
forward to security holders a candidate for election, as a director. The biography of each director standing for election or re-election
is expressly mentioned in the Notice of Meeting of the company’s AGM (ASX Recommendation 1.2). The Directors and Management
Committee have a clear understanding of their roles and responsibilities and of the company’s expectations of them as set out in their
employment contracts (ASX Recommendation 1.3). The Company Secretaries are integral in advising the Board and its committees
on governance matters, ensuring that board and committee policy and procedures and followed, and helping to organise and
minuting discussions of board and committee meetings (ASX Recommendation 1.4).
The performance of each Management Committee member is evaluated against goals and objectives with the assistance of the
Remunerations, Nominations and Disciplinary Committee. The performance of the Management Committee was reviewed in FY 17
(ASX Recommendation 1.7). The performance of the Directors and Board Committees are reviewed periodically with the assistance
of the Remunerations, Nominations and Disciplinary Committee. The performance and the composition of the Board Committees
were reviewed in FY17 (ASX Recommendation 1.6).
The Board’s Charter, Board Committee Charters, Share Trading Policy, Continuous Disclosure Policy and Code of Conduct are
available for access by shareholders and the general public in the corporate governance section of the Company’s website (ASX
Recommendation 3.5).
PRiNciPLE 2: sTRUcTURE ThE B OARd TO Add vALUE
The Remunerations, Nominations and Disciplinary Committee has been established by the Board of the Company (ASX
recommendation 2.1) and applies to the Company and its subsidiaries to support and advise the Board in fulfilling its responsibilities
to shareholders, employees and other stakeholders of the Company by endeavouring to ensure that:
• the directors and senior management of the Group are remunerated fairly and appropriately;
• the Group’s remuneration policies and outcomes strike an appropriate balance between the interests of the Company’s shareholders,
and rewarding and motivating the Group’s executives and employees in order to secure the long term benefits of their energy and
loyalty;
• the human resources policies and practices are consistent with and complementary to the strategic direction and objectives of the
Company as determined by the Board;
• it reviews and advises the Board on the composition of the Board and its Committees;
• it reviews the performance of the Board, the chairman of the Board, the executive and non-executive directors, and other individual
members of the Board; and
• proper succession plans are in place for consideration by the Board.
This Committee is chaired by James Davis and has one other member, the Hon. John Sharp. The Committee had five meetings
during the FY attended by all members of the Committee. Descriptions of the members’ qualifications, skills and experience are
included in the Directors’ Report.
The Board acknowledges the ASX recommendations to have the Committee compose of a majority of independent directors and
have at least three members. The Committee is currently made up of two independent directors. The Board feels at this stage that two
members are sufficient for the Remunerations, Nominations and Disciplinary Committee given the size of the Company and Board.
The Remunerations, Nominations and Disciplinary Committee has a formal charter which is available on the Company’s website.
The skills, experience and expertise relevant to the position of director held by each director in office at the date of the annual report
are set out in the Director’s Report.
27
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
28
Below is the Rex Board skills matrix outlining the skills that the board currently has (ASX Recommendation 2.2):
The Board is responsible for the management of the affairs of the Company and its subsidiaries (the Group), including:
lim
Kim HAi
JoHN
sHArP
lee
tHiAN soo
roNAlD
BArtsCH
JAmes
DAvis
CHris
HiNe
Neville
Howell
(A)
sTRATEgic ANd fiNANciAL PERfORmANcE
BUSINESS / ENTREPRENEURIAL EXPERIENCE
POLITICAL EXPERIENCE
CORPORATE GOVERNANCE
SAFETY AND RISK MANAGEMENT
FINANCE
LEGAL
REGULATORY KNOWLEDGE AND EXPERIENCE
INDUSTRY
EXPERIENCE
PILOT
ENGINEERING KNOWLEDGE
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
The membership of the Board during the year ended 30 June 2017, including independence status was as follows (ASX
Recommendation 2.3):
Director
Lim Kim Hai
status
Executive Chairman
The Hon. John Sharp
Deputy Chairman and Independent Director
Lee Thian Soo
Non-Executive Director
Date of Appointment
Appointed 27 June 2003 and re-appointed 16 November 2006, 25
November 2009, 27 November 2012 and 27 November 2015.
Appointed 14 April 2005 and re-appointed 19 November 2008, 23
November 2011, 27 November 2013 and 29 November 2016.
Appointed 27 June 2003 and re-appointed 16 November 2006, 25
November 2009, 27 November 2012 and 27 November 2015.
Neville Howell
Chief Operating Officer & Executive Director
Appointed 1 July 2014 and re-appointed 26 November 2014.
Chris Hine
Executive Director &
Group Flight Operations Advisor
James Davis
Independent Director
Ronald Bartsch
Independent Director
Appointed 1 March 2011 and re-appointed 23 November 2011 as
Executive Director. Appointed 26 November 2014 as Non-Executive
Director. Appointed 18 May 2015 as Executive Director and Group
Flight Operations Advisor.
Appointed 26 August 2004 as Executive Director and re-appointed 23
November 2011 and 26 November 2014 as Independent Director.
Appointed 23 November 2010 and re-appointed 23 November 2011
and 26 November 2014.
The Board acknowledges the ASX Recommendation that a majority of the Board should be independent directors (ASX Recommendation
2.4). Although the Board has only three directors out of seven that qualify as independent non-executive directors, Lee Thian Soo is non-
executive and is only considered non-independent by virtue of his share ownership. The Board believes that every director on the current
Board will make decisions in the best interests of all shareholders and in accordance with their duties as directors.
The Board also acknowledges that it is desirable that the Chairman be an independent director and for his role to be segregated from
that of the Chief Executive Officer (ASX Recommendations 2.5). However, the Board views the Chairman’s history of leadership of the
Company as an advantage, both at the management level and at the Board level. This has resulted in performance that matches the
best airlines in the world. The Board acknowledges that if the Chair is not an independent director, the Deputy Chairman should be an
independent director, which is the case.
• Developing and approving the corporate strategy.
• Evaluating, approving and monitoring the strategic and financial plans and objectives of the Group.
• Evaluating, approving and monitoring the annual budgets and business plans.
• Determining the Company’s dividend policy, the operation of the Company’s dividend re-investment plan (if any), and the amount and
timing of all dividends.
• Evaluating, approving and monitoring major capital expenditure, capital management and all major acquisitions, divestitures and other
corporate transactions, including the issue of securities of the Company.
• Approving all accounting policies, financial reports and material reporting and external communications by the Group.
• Appointment of the Chairman of the Company.
(B)
ExEcUTivE mANAgEmENT
• Appointing, monitoring and managing the performance of the Chief Operating Officer or Managing Director and other executive
directors.
• Managing succession planning for the executive directors and such other key management positions which may be identified
from time to time.
• Appointing the Company Secretary.
• With the advice and assistance of the Remunerations, Nominations and Disciplinary Committee, reviewing and approving the
performance and remuneration of the individual Board members and policies with respect to remuneration of any employees
(c)
AUdiT
• Upon the recommendation of the Audit and Corporate Governance Committee, appointing the external auditor and determining its
remuneration and terms of appointment.
• Ensuring that effective audit and regulatory compliance programmes are in place to protect the Group’s assets and
shareholder value.
• Approving and monitoring the Group’s audit framework. Approving and, with the assistance and advice of the Audit and Governance
Committee, monitoring compliance with the Group’s audit policies and protocol.
• Monitoring the Group’s operations in relation to, and compliance with relevant regulatory and legal requirements.
(d)
cORPORATE gOvERNANcE
• At least once every two years the Board will, with the assistance and advice of the Audit and Corporate Governance Committee,
review the performance and effectiveness of the Company’s corporate governance policies and procedures and, if appropriate,
amend those policies and procedures as necessary.
• The Board will review and approve all disclosures related to any departures from the ASX Principles of Good Corporate Governance.
• The Board will review and approve the public disclosure of any of the Group’s policies and procedures.
• The Board will supervise the public disclosure of all matters that the law and ASX Listing Rules require to be publicly disclosed,
consistent with the Continuous Disclosure Compliance Policy approved by the Board.
• The Board will approve the appointment of directors to committees established by the Board.
• The Board will approve and monitor delegations of authority.
(E)
RisK mANAgEmENT
• The Company recognises that the management of business and economic risk is an integral part of its operations and has for many
years integrated risk management processes into its operations to ensure continuity of the business and to minimise any impact on its
performance. The Board has established a sound system of risk oversight and management and internal control which involve the Safety
and Risk Management Committee and the Audit and Corporate Governance Com mittee.
• Ensuring that effective risk management programmes are in place to protect the Group’s assets and shareholder value.
• Approving and monitoring the Group’s risk framework, including (but not limited to) systems of risk management and internal control.
• Approving and, with the assistance and advice of the Risk Management Committee, monitoring compliance with the Group’s risk.
• The Charters of both committees are available on the Company’s website.
(f)
sTRATEgic PLANNiNg
• The Board will be actively and regularly involved in strategic planning.
• Strategic planning will be based on the identification of opportunities and the full range of business risks that will determine which of
those opportunities are most worth pursuing.
• The Board will, on an ongoing basis, review how the strategic environment is changing, what key business risks and opportunities are
appearing, how they are being managed and what, if any, modifications in strategic direction should be adopted.
29
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
30
(g) PERfORmANcE EvALUATiON
• At least once per year the Board will, with the advice and assistance of the Remunerations, Nominations and Disciplinary Committee,
review and evaluate the performance of the Board, each Board Committee, and each individual director against the relevant Charters,
corporate governance policies, and agreed goals and objectives (ASX Recommendation 2.5).
• Following each review and evaluation the Board will consider how to improve its performance.
• The Board will agree and set the goals and objectives for the Board and its Committees each year, and if necessary, amend the
relevant Charters and policies.
• With the advice and assistance of the Remunerations, Nominations and Disciplinary Committee, the Board will review and approve the
remuneration of the Company’s executive and non-executive directors.
The evaluation of the Board, its committees and directors was carried out during the FY as set out above.
A Director of the Company is entitled to seek independent professional advice (including, but not limited to, legal, accounting and
financial advice) at the Company’s expense on any matter connected with the discharge of his or her responsibilities, in accordance
with the procedures and subject to the conditions set out in the Board Charter.
The Board believes that its members have the appropriate skill set and knowledge to effectively perform their roles as directors
without requiring further professional development. Our board members have a vast wealth of experience in the aviation industry and
beyond as a majority of them have aircraft pilot qualifications.
The Company has a program for inducting new Directors.
PRiNciPLE 3: PROmOTE EThicAL ANd REsPONsiBLE dE cisiON mAKiNg
Directors and the Management Committee are required to maintain the highest legal, moral and ethical standards of conduct. The
Board has adopted the Code of Conduct which provides guidance to all staff on compliance with legal and other obligations (ASX
Recommendation 3.1).
The Company has established a Share Trading Policy (ASX Recommendation 1.3). Under this policy, Directors and Management
Committee are prohibited from trading in securities of the Company without prior approval from the Board.
The Company employs all staff on their merits and is committed to recognising and valuing the contributions of staff from diverse
backgrounds. The Company has established a Diversity Policy (ASX Recommendation 1.5).
The Company does not believe in an affirmative action policy and setting of artificial targets for staff of various backgrounds (gender,
religious, cultural, racial etc) but rather in ensuring that all staff are able to develop to their full extent of their capabilities and contributions.
The Company was compliant with the Workplace Gender Equality Act 2012 as reported by the Workplace Gender Equality Agency.
As at the end of the reporting period the proportion of female employees in the Company was 32.49%. There were fourteen women
holding management positions in the Company. There were no female Board members or Management Committee members.
In accordance with the requirements of the Workplace Gender Equality Act 2012 (Act), Regional Express Holdings Limited lodged
its annual public report (2016-2017) with the Workplace Gender Equality Agency (Agency).
To access a copy of the report refer to the Rex website under Corporate and Social Responsibilities.
Details on the reporting process can be located at the Workplace Gender Equality Website: www.wgea.gov.au
The Code of Conduct, Share Trading Policy and Diversity Policy are available on the Company’s website.
PRiNciPLE 4: sAfEgUARd iNTEgRiTy iN fiNANciAL REPORTiNg
The Audit and Corporate Governance Committee has a formal Charter which is available on the Company’s website (ASX Recommendation 4.1).
The Chief Operating Officer and the General Manager (GM) Corporate Services who oversees the finance department, provide written
assurance to the Board as to the integrity of the financial statements and that they are founded on a sound system of risk management
and internal controls which are operating effectively and efficiently (ASX Recommendation 4.2).
The Board acknowledges the ASX Recommendation to have the Chief Executive Officer and Chief Financial Officer provide this
statement to the Board. The Board believes that it is appropriate for Chief Operating Officer and GM Corporate Services to provide
the statement.
The directors have ensured that the Company’s External Auditor attends all Annual General Meetings and is available to answer
shareholders’ questions about the conduct of the audit and the preparation and content of the Auditor’s report thereon (ASX
Recommendation 4.3).
PRiNciPLE 5: mAKE TimELy ANd BALANcEd discLOsURE
The Company complies with the continuous disclosure obligations of the ASX Listing Rules and, in doing so, immediately notifies the
market of any material price sensitive information. The Company has adopted and implemented a Continuous Disclosure Policy which
sets out the procedure for the identification of material price sensitive information and reporting of such information to the company
secretaries for review (ASX Recommendation 5.1). The Continuous Disclosure Policy is available on the Company’s website.
PRiNciPLE 6: REsPEcT ThE RighTs Of shAREhOLdERs
It is the Company’s policy that the principal communication with shareholders apart from the Company website is the provision
of the Annual Report, including the Financial Statements, half yearly investor briefings and the Annual General Meeting (and any
extraordinary meetings held by the Company). Shareholders are encouraged to participate in half-yearly investor briefings either
by attendance or by dialling in through the Company’s teleconferencing facilities and are invited to put questions to the Chairman
of the Board in that forum (ASX Recommendation 6.3). The Company’s website provides additional information and greater detail
about the Company, including ASX and media releases and access to statements regarding corporate governance related matters
(ASX Recommendation 6.1).
The Board acknowledges the ASX recommendation of facilitating effective two-way communication with investors. Shareholders are
able to contact the company through the company secretaries (ASX Recommendation 6.2).
The Company acknowledges that some security holders prefer the speed, convenience and environmental friendliness of electronic
communications over more traditional methods of communication. To this end the Company provides its security holders with
the option of receiving either a hard or soft copy of its annual report and notice of meeting for its Annual General Meeting (ASX
Recommendation 6.4).
PRiNciPLE 7: REcOgNisE ANd mANAgE RisK
The Company has integrated risk management processes into its operations to ensure continuity of the business and to minimise
any impact on its performance.
The Board has established policies for a sound system of risk oversight and management and internal control which involve the
Safety and Risk Management Committee (Recommendation 7.1).
The Safety and Risk Management Committee has been established by the Board of the Company and applies to the Company
and its subsidiaries to support and advise the Board in fulfilling its responsibilities to shareholders, employees and other stakeholders
of the Company by:
The Audit and Corporate Governance Committee has been established by the Board of the Company (ASX recommendation 4.1)
to assist the Board in fulfilling its commitment to ensure the integrity of the Company’s financial reports and Corporate Governance policies:
• assisting the Board in fulfilling its development, oversight and review responsibilities for the safety culture and safety management
processes as defined by the separate safety policies published for each Air Operator Certificate holder within the Group; and
• assisting the Board in fulfilling its oversight responsibilities for the financial reporting process, the system of internal control relating to
all matters affecting the Group’s financial performance, the audit process, and the Company’s process for monitoring compliance with
laws and regulations and the code of conduct;
• advising the Board on good governance standards and appropriate corporate governance policies for the Group; and
• critically reviewing the Group’s performance against its corporate governance policies.
In FY 17, this Committee was chaired by the Hon. John Sharp and has one other member, James Davis. Descriptions of the members’
qualifications, skills and experience are included in the Directors’ Report. The Committee had two meetings during FY 17 attended by all
then-current members of the Committee.
The Board acknowledges the ASX recommendations to have the Committee composed of a majority of independent directors, chaired
by an independent director and have at least three members (ASX Recommendation 4.1).
The Committee is currently made up of two non-executive directors of which both are independent. The Board feels that the directors
in the audit committee will make decisions that are in the best interests of the shareholders in their duties as audit committee members
and directors of the company. The Board also feels at this stage that two members are sufficient for the audit committee given the size
of the company and Board.
31
REGIONAL EXPRESS HOLDINGS LIMITED
• implementing and supervising the Group’s operational risk assessment framework.
The Board acknowledges the ASX recommendation to have the Committee composed of a majority of independent directors and
chaired by an independent director and have at least three members (ASX Recommendation 7.1).
The Committee is currently made up of one independent director. The Board feels that the directors in the Safety and Risk Management
Committee will make decisions that are in the best interests of the shareholders in their duties as Safety and Risk Management
Committee members and directors of the company. The Board also feels at this stage that two members are sufficient for the Safety
and Risk Management Committee given the size of the company and Board.
The Safety and Risk Management Committee has a formal Charter which sets out the responsibilities of the Committee as well as
the Company’s policies on risk oversight and management. The Charter is available on the Company’s website.
The Board reviews the safety and risk management report prepared by the Group’s Safety Manager at each Board meeting (ASX
Recommendation 7.2).
Being an airline, Rex is required by the Civil Aviation Safety Authority to have a safety and compliance department. Staffed by
approximately 12 full time equivalent employees, this department conducts internal audits of all Rex’s operations including flight
operations, engineering and airport operations. The head of this department, the GM Human Factors, has a direct reporting line to
the Board and Chairman (ASX Recommendation 7.3).
The Company has outlined its main material risk sources that could adversely affect the entity’s prospects for future FYs and has
explained how these risks are managed in the Directors’ Report (ASX Recommendations 7.1 and 7.4).
REGIONAL EXPRESS HOLDINGS LIMITED
32
PRiNciPLE 8: REmUNERATE fAiRLy ANd REsPONsiBLy
The Board has established a Remunerations, Nominations and Disciplinary Committee. The membership, responsibilities and number
of meetings held have been set out under Principle 2. Also set out under Principle 2 is the explanation as to why the membership of
the Committee differs from the ASX Recommendations.
Details of the Board and Management Committee remuneration structures are contained in the Remuneration Report (ASX
Recommendation 8.2 and 8.3).
This PAgE hAs BEEN iNTENTiONALLy LEfT BLANK
33
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
34
FiNaNCial
STaTeMeNTS
cONsOLidATEd sTATEmENT Of PROfiT OR LOss
fOR ThE fiNANciAL yEAR ENdEd 30 JUNE 2017
Passenger revenue
Freight revenue
Charter revenue
Other passenger services and amenities
Other revenue
total revenue
Finance income
other gains / (losses)
Flight and port operation costs (excluding fuel)
Fuel costs
Salaries and employee-related costs
Selling and marketing costs
Engineering and maintenance costs
Office and general administration costs
Finance costs
Depreciation and amortisation
Asset impairment
Goodwill impairment
total costs and expenses
Profit / (loss) before tax
Tax (expense) / benefit
Profit / (loss) after tax
Profit / (loss) attributable to
Members of the parent
earnings / (loss) per share
Basic
Diluted
Notes to the financial statements are included on pages 41 to 73.
Note
2017
$’000
2016
$’000
249,349
227,239
1,418
1,333
22,983
24,862
2,601
2,371
4,616
6,101
280,967
261,906
770
721
194
(250)
(54,476)
(48,569)
(30,928)
(35,150)
(105,533)
(103,001)
(7,465)
(6,855)
(39,936)
(39,149)
(7,540)
(7,090)
(1,975)
(2,171)
(16,268)
(16,136)
-
(8,344)
-
(6,615)
(264,121)
(273,080)
17,810
(10,703)
(5,190)
1,146
12,620
(9,557)
4
4
4
4
4
4
4
4
5
12,620
(9,557)
12,620
(9,557)
cents per share
cents per share
16
16
11.7
(8.8)
11.7
(8.8)
35
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
36
cONsOLidATEd sTATEmENT Of OThER cOmPREhENsivE iNcOmE OR LOss
fOR ThE fiNANciAL yEAR ENdEd 30 JUNE 2017
cONsOLidATEd sTATEmENT Of fiNANciAL POsiTiON
As AT 30 JUNE 2017
Profit / (loss) after tax
other comprehensive (loss) / income
Hedge reserve
Revaluation of cash flow hedges
Income tax effect
other comprehensive (loss) / income, net of tax
Note
15
15
2017
$’000
2016
$’000
12,620
(9,557)
(899)
969
270
(291)
(629)
678
Current assets
Cash and bank balances
Trade and other receivables
Inventories
Other financial assets
total current assets
Non-current assets
Other receivables
total comprehensive income / (loss)
11,991
(8,879)
Available for sale investments carried at fair value – shares
Notes to the financial statements are included on pages 41 to 73.
Property, plant and equipment
Aircraft
Other property, plant and equipment
Goodwill and other intangible assets
total non-current assets
total assets
Current liabilities
Trade and other payables
Unearned revenue
Borrowings
Provisions
Current tax payable
Other financial liabilities
total current liabilities
Borrowings
Provisions
Deferred tax liabilities
total non-current liabilities
total liabilities
Net assets
equity
Issued capital
Reserved shares
Retained earnings
Share-based payments reserve
Other reserves
total equity
Notes to the financial statements are included on pages 41 to 73.
Note
22
6
7
23
6
8
9
10
11
12
13
5
23
12
13
5
14
15
15
15
2017
$’000
2016
$’000
26,257
26,821
10,805
9,626
24,645
22,964
140
1,105
61,847
60,516
6,515
7,448
9
9
96,712
108,572
106,872
92,946
853
1,026
210,961
210,001
272,808
270,517
18,330
25,912
22,698
19,341
7,075
6,641
7,172
5,413
1,172
1,069
70
136
56,517
58,512
16,551
23,638
1,371
1,857
1,924
402
19,846
25,897
76,363
84,409
196,445
186,108
72,024
72,024
(3,246)
(1,821)
124,670
112,050
1,358
1,587
1,639
2,268
196,445
186,108
37
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
38
cONsOLidATEd sTATEmENT Of cAsh fLOWs
fOR ThE fiNANciAL yEAR ENdEd 30 JUNE 2017
cONsOLidATEd sTATEmENT Of chANgEs iN EQUiTy
fOR ThE fiNANciAL yEAR ENdEd 30 JUNE 2017
Note
22 (B)
Receipts from customers
Payments to suppliers, employees and others
Interest paid
Income tax (paid) / refunded
Net cash flows from operating activities
Interest received
Proceeds from investment - capital reduction
Proceeds from disposal of property, plant and equipment
Payments for property, plant and equipment - aircraft and other
Payments for property, plant and equipment - software
Net cash flows used in investing activities
Shares purchased as reserve shares
Repayment of borrowings – non-related parties
Proceeds from borrowings
Net cash flows used in financing activities
Net (decrease) / increase in cash held
Cash at the beginning of the financial year
Cash at the end of the financial year
22 (A)
Notes to the financial statements are included on pages 41 to 73.
2017
$’000
312,112
(280,218)
(1,912)
(3,869)
26,113
770
-
2,262
(20,446)
(130)
(17,544)
(2,488)
(6,645)
-
(9,133)
(564)
26,821
26,257
2016
$’000
291,139
(261,590)
(2,464)
1,343
28,428
721
1
228
(20,011)
(88)
(19,149)
(668)
(8,515)
3,365
(5,818)
3,461
23,360
26,821
Attributable to equity holders of the Company
Issued
capital
$’000
Reserved
shares
$’000
Retained
earnings
$’000
Share-based
payments
reserve
$’000
Cash flow
hedge
reserve
$’000
General
reserve
$’000
Total
equity
$’000
At 1 July 2015
Loss for the year
72,024
(2,273)
121,607
948
-
1,590
193,896
-
-
(9,557)
-
-
-
(9,557)
Other comprehensive income, net of tax
-
-
-
-
678
-
678
Total comprehensive (loss) / income
-
-
(9,557)
-
678
-
(8,879)
Shares purchased as reserve shares
-
(668)
-
-
-
-
(668)
Share gift issued - gift
Share gift plan provision
At 30 June 2016
At 1 July 2016
Profit for the year
-
1,120
-
(688)
-
-
432
-
-
-
1,327
-
-
1,327
72,024
(1,821)
112,050
1,587
678
1,590
186,108
72,024
(1,821)
112,050
1,587
678
1,590
186,108
-
-
12,620
-
-
-
12,620
Other comprehensive loss, net of tax
-
-
-
-
(629)
-
(629)
Total comprehensive income / (loss)
-
-
12,620
-
(629)
-
11,991
Shares purchased as reserve shares
-
(2,488)
-
-
-
-
(2,488)
Share gift issued - gift
-
1,063
-
(1,063)
-
-
-
Share gift plan provision transfer
-
-
-
(521)
-
-
(521)
Share gift plan provision
At 30 June 2017
-
-
-
1,355
-
-
1,355
72,024
(3,246)
124,670
1,358
49
1,590
196,445
Notes to the financial statements are included on pages 41 to 73.
39
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
40
NOTEs TO ThE cONsOLidATEd fiNANciAL sTATEmENTs
fOR ThE fiNANciAL yEAR ENdEd 30 JUNE 2017
Note
Content
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
General Information
Application of New and Revised Accounting Standards
Critical Accounting Judgements and Key Sources of Estimation Uncertainty
Revenues and Expenses
Income Tax
Trade and Other Receivables
Inventories
Property, Plant and Equipment
Goodwill and Other Intangible Assets
Trade and Other Payables
Unearned Revenue
Borrowings
Provisions
Issued Capital
Reserved Shares and Other Reserves
Earnings Per Share
Dividends
Commitments for Expenditure
Contingent Liabilities and Contingent Assets
Subsidiaries
Acquisition of Businesses
Notes to the Consolidated Statement of Cash Flows
Financial Instruments
Key Management Personnel Compensation
Related Party Transactions
Remuneration of Auditors
Events After the Reporting Period
Segment Information
Parent Entity Disclosures
Significant Accounting Policies
01 gENERAL iNfORmATiON
Regional Express Holdings Limited (the Company) is listed on the Australian Securities Exchange (Trading under symbol ‘REX’),
incorporated and operating in Australia. The Company’s registered office and its principal place of business is at 81 – 83 Baxter
Road, Mascot, NSW 2020, Australia. Principal activities of the Group are the provision of air services principally for the transportation
of passengers and freight.
02 APPLicATiON Of NEW ANd REvisEd AccOUNTiNg sTANdARds
In the current year, the Group has applied all amendments to AASBs issued by the Australian Accounting Standards Board (AASB)
that are mandatorily effective for an accounting period that begins on or after 1 July 2016, and therefore relevant for the current year
end. The most relevant amendment is noted below. The application of these amendments does not have any material impact on
the disclosures or the amounts recognised in the Group’s consolidated financial statements.
AASB 2015-3 ‘Amendments to Australian Accounting Standards arising from the
Withdrawal of AASB 1031 Materiality’
This amendment completes the withdrawal of references to AASB 1031 in all
Australian Accounting Standards and Interpretations, allowing that Standard to
effectively be withdrawn.
APPLicATiON Of NEW ANd REvisEd Acc OUNTiNg sTANdARds NOT yET EffEcTivE
At the date of authorisation of the financial statements, the Standards and Interpretations that were issued but not yet effective are
listed below. The potential impact of these Standards and Interpretations has not yet been fully determined. The Group does not
intend to adopt any of these announcements before their effective dates.
Standard/Interpretation and nature of the change and impact
AASB 9 ‘Financial Instruments’ (and the relevant amending standards) (AASB 9): The
standard introduces a number of new and revised classifications of financial assets and
liabilities compared to AASB 139 ‘Financial Instruments: Recognition and Measurement’
and addresses the classification, measurement and de recognition of these financial assets
and financial liabilities. AASB 9 introduces new rules for hedge accounting and a new
methodology for measurement of impairment of financial assets including accounting for
expected credit loss.
The Group classifies fuel swap derivatives as cash flows hedges, and recognises material
financial assets and liabilities to which AASB 9 will apply at amortised cost under AASB 139.
The Group has commenced an assessment of the impact of this change on the recognition
and measurement of financial assets and liabilities and related disclosures in the financial
statements. At the date of this report this assessment is not complete.
AASB 15 ‘Revenue from Contracts with Customers’, AASB 2014-5 ‘Amendments to
Australian Accounting Standards arising from AASB 15’, AASB 2015-8 ‘Amendments
to Australian Accounting Standards – Effective date of AASB 15’ (AASB 15): AASB 15
will replace AASB 118 ‘Revenue’ which covers revenue arising from the sale of goods
and the rendering of services and AASB 111 ‘Construction Contracts’ which covers
construction contracts.
The new standard introduces a five-step model to determine when and how much
revenue should be recognised. The standard permits either a full retrospective or a
modified retrospective approach for the adoption.
The Group has commenced an assessment of the impact of this change on the
recognition and measurement of revenues of the Group and related disclosures in the
financial statements. At the date of this report this assessment is not yet complete. The
preliminary assessment of the existing contractual arrangements that deal with revenue
indicate that the changes from the new standard are not expected to have a material
impact on the Group.
AASB 16 ‘Leases’ (AASB 16): AASB 16 introduces new requirements in relation to lease
classification and recognition, measurement and presentation and disclosures of leases
for lessees and lessors. For lessees a (right-of-use) asset and a lease liability will be
recognised on the balance sheet in respect of all leases subject to limited exceptions. The
accounting for lessors will not significantly change.
The Group is not a party to any significant operating lease agreements (as lessee) and
significant change to the recognition and measurement of the Group’s finance leases is not
expected. On the basis that there are no changes to lease arrangements, the new standard
is not expected to have a material impact on the recognition and measurement of lease-
related expenses, assets or liabilities.
The Group has commenced an assessment of the impact of this change on disclosures in
the financial statements. At the date of this report this assessment is not complete.
Effective for annual reporting
periods beginning on or after
Expected to be initially applied in
the financial year ending
1 January 2018
30 June 2019
1 January 2018
30 June 2019
1 January 2019
30 June 2020
At the date of report, there are no pronouncements approved by the IASB/IFRIC that have yet to be issued by the AASB.
41
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
42
03 cRiTicAL AccOUNTiNg JUdgEmENTs ANd KEy sOURcEs Of
EsTimATiON UNcERTAiNTy
In the application of the Group’s accounting policies, which are described in Note 30, the directors are required to make judgments,
estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources.
The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant.
Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in
the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if
the revision affects both current and future periods.
KEy sOURcEs Of EsTimATiON UNcERTAiNTy
The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the balance
date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the
next financial year:
imPAiRmENT Of gOOdWiLL
Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to which goodwill
has been allocated. The value in use calculation requires the entity to estimate the future cash flows expected to arise from the cash-
generating unit and a suitable discount rate in order to calculate present value.
The carrying amount of goodwill at the balance date was $518 thousand (2016: $518 thousand) with no impairment loss recognized
during the year (2016: $6,615 thousand).
fAiR vALUE Of dERivATivEs ANd OThER fiNANciAL iNsTRUmENTs
As described in Note 23, management uses their judgment in selecting an appropriate valuation technique for financial instruments
not quoted in an active market. Valuation techniques commonly used by market practitioners are applied. For derivative financial
instruments, assumptions are made based on quoted market rates adjusted for specific features of the instrument.
UsEfUL LivEs Of PROPERTy, PLANT ANd E QUiPmENT
As described in Note 30 (S), the Group reviews the estimated useful lives of property, plant and equipment at the end of each
reporting period. During the current year, it is determined that the useful lives of property, plant and equipment correctly reflected the
rate at which the assets are consumed.
EmPLOyEE ENTiTLEmENTs
Management judgement is applied in determining the following key assumptions used in the calculation of long service leave at
balance date:
• future increases in wages and salaries;
• future on-cost rates; and
• experience of employee departures and period of service.
04 REvENUEs ANd ExPENsEs
fOR ThE fiNANciAL yEAR ENdEd 30 JUNE 2017
other revenue
Training income
Engineering services
Insurance claim
Other income
Finance income
Interest
other gain / (losses)
Net foreign currency gain / (loss)
(Loss) / gain on disposal of property, plant and equipment
salaries and employee-related costs
Wages and salaries (including bonus – profit share scheme)
Workers’ compensation costs
Superannuation costs - defined contribution plan
Expense of share-based payments
office and general administrative costs
Bad debts written-off
Finance costs
Interest on bank borrowings and finance leases paid during the year
Amortisation of interest paid in previous years
Interest expense
The weighted average interest rate on borrowings is 9.1% per annum, and 3.9% per annum for finance leases.
Depreciation and amortisation
Depreciation and amortisation of property, plant and equipment
Amortisation of development costs and software
impairment
Asset impairment
Goodwill impairment
lease payments included in consolidated statement of profit or loss
Included in flight and port operation costs
Minimum lease payments – operating lease
2017
$’000
2,697
80
262
1,577
4,616
770
770
348
(154)
194
(96,103)
(1,223)
(6,852)
(1,355)
(105,533)
(92)
(92)
(1,912)
(63)
(1,975)
(15,965)
(303)
(16,268)
-
-
-
(801)
(801)
2016
$’000
1,557
701
148
3,695
6,101
721
721
(345)
95
(250)
(93,716)
(987)
(6,971)
(1,327)
(103,001)
(80)
(80)
(2,464)
293
(2,171)
(15,796)
(340)
(16,136)
(8,344)
(6,615)
(14,959)
(231)
(231)
43
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
44
05 iNcOmE TAx
iNcOmE TAx REcOgNisEd iN PROfiT OR LOss
Tax expense comprises:
Current tax expense
Prior period tax expense
Deferred tax expense / (benefit) relating to the origination and reversal of temporary
differences
tax expense / (benefit)
The prima facie income tax expense on pre-tax accounting profit from operations reconciles
to the income tax expense in the financial statements as follows:
Profit / (loss) before tax from operations
Tax expense / (benefit) calculated at 30%
Tax on (non-assessable income) / non-deductible expense
Prior period tax expense
Previously unrecognised and unused tax losses and tax offsets now recognised as deferred
tax assets
tax expense / (benefit)
Effective tax rates
2017
$’000
3,399
-
1,791
5,190
17,810
5,343
(37)
-
(116)
5,190
29.1%
2016
$’000
1,391
283
(2,820)
(1,146)
(10,703)
(3,211)
1,918
283
(136)
(1,146)
(10.7%)
The tax rate used in the above reconciliation is the corporate tax rate of 30% payable by Australian corporate entities on taxable profits
under Australian tax law. There has been no change in the corporate tax rate when compared with the previous reporting period.
The following current and deferred tax amounts have been recognised in the statement of financial position.
Current tax assets and liabilities
Current tax payable
Income tax attributable:
Parent entity
Deferred tax balances
Deferred tax assets comprise:
Temporary differences
Deferred tax liabilities comprise:
Temporary differences
Net deferred tax liabilities
2017
$’000
1,172
1,172
6,922
6,922
(8,846)
(8,846)
(1,924)
2016
$’000
1,069
1,069
7,499
7,499
(7,901)
(7,901)
(402)
Taxable and deductible temporary differences arise from the following:
Opening
balance
$’000
Charged to
income
$’000
Charged to
equity
$’000
Acquisitions /
disposals
$’000
Exchange
differences
$’000
Changes in
tax rate
$’000
Closing
balance
$’000
30 June 2017
Gross deferred tax liabilities
Inventories
Other items
Gross deferred tax assets
Employee-related provisions
Provision for doubtful debts
Other items
(5,910)
(1,991)
(7,901)
2,673
9
4,817
7,499
(535)
(679)
(1,214)
314
-
(891)
(577)
-
269
269
-
-
-
-
Net deferred tax
(402)
(1,791)
269
30 June 2016
Gross deferred tax liabilities
Inventories
Other items
Gross deferred tax assets
Employee-related provisions
Provision for doubtful debts
Other items
(5,426)
(1,573)
(6,999)
2,571
9
2,031
4,611
(484)
(418)
(902)
102
-
2,786
2,888
Net deferred tax
(2,388)
1,986
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
As at end of the year, there was no deferred tax assets not brought to the accounts as assets (2016: $116 thousand).
06 TRAdE ANd OThER REcEivABLEs
Current
Trade receivables
Provision for doubtful debts
Sundry debtors and other debtors
Prepayments
Non-current
Other receivables – at amortised cost
2017
$’000
6,304
(31)
6,273
3,258
1,274
10,805
6,515
6,515
(6,445)
(2,401)
(8,846)
2,987
9
3,926
6,922
(1,924)
(5,910)
(1,991)
(7,901)
2,673
9
4,817
7,499
(402)
2016
$’000
5,237
(31)
5,206
2,816
1,604
9,626
7,448
7,448
45
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
46
Trade receivables are non-interest bearing and are generally on 30 day terms. A provision for doubtful debts is made when there is
objective evidence that a trade receivable is impaired. The amount of the provision has been measured as the difference between
the carrying amount of the trade receivables and the estimated future cash flows expected to be received from the relevant debtors.
The Group has provided fully for all receivables deemed irrecoverable based on historical experience.
Before accepting new customers, the Group assesses the potential customer’s credit quality and defines credit limits by customer.
Limits attributed to customers are reviewed regularly.
Majority of the Group’s revenue is derived from sales made through credit cards where counterparties are either banks or the credit
card companies.
Ageing of past due but not impaired
60 - 90 days
91 - 120 days or more
total
Average age (days)
movement in the provision for doubtful debts
Balance at the beginning of the year
Impairment losses on receivables
Balance at the end of the year
Ageing of impaired trade receivables
60 - 90 days
91 - 120 days
120+ days
total
07 iNvENTORiEs
Current
Consumable spares at cost
2017
$’000
-
-
-
30
(31)
-
2016
$’000
-
-
-
30
(31)
-
(31)
(31)
-
-
-
-
(31)
(31)
(31)
(31)
2017
$’000
24,645
2016
$’000
22,964
08 PROPERTy, PLANT ANd EQUiPmENT
At 30 June 2017
Aircraft
Other property, plant and equipment
Rotable assets
Engines
Plant and equipment
Land and buildings
Leasehold improvements
Motor vehicles
Furniture and fittings
Computer equipment
Other property, plant and equipment
total property, plant and equipment
At 30 June 2016
Aircraft
Other property, plant and equipment
Rotable assets
Engines
Plant and equipment
Land and buildings
Leasehold improvements
Motor vehicles
Furniture and fittings
Computer equipment
Other property, plant and equipment
total property, plant and equipment
Opening gross
carrying amount
$’000
Additions
$’000
Disposals /
Reclassification
$’000
Closing gross
carrying amount
$’000
194,344
264
(9,359)
185,249
71,498
6,171
11,478
29,973
1,408
2,503
1,108
2,340
126,479
320,823
7,959
4,090
828
6,187
10
86
58
964
20,182
20,446
(184)
(317)
(418)
-
(78)
(15)
(86)
(513)
(1,161)
79,273
9,944
11,888
36,160
1,340
2,574
1,080
2,791
145,050
(10,970)
330,299
195,944
2,686
(4,286)
194,344
63,302
5,522
10,952
28,201
1,327
2,436
1,072
2,127
114,939
310,883
12,598
1,684
764
1,750
103
127
57
242
17,325
20,011
(4,402)
(1,035)
(238)
22
(22)
(60)
(21)
(29)
71,498
6,171
11,478
29,973
1,408
2,503
1,108
2,340
(5,785)
126,479
(10,071)
320,823
47
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
48
At 30 June 2017
Aircraft
Other property, plant and equipment
Rotable assets
Engines
Plant and equipment
Land and buildings
Leasehold improvements
Motor vehicles
Furniture and fittings
Computer equipment
Other property, plant and equipment
At 30 June 2016
Aircraft
Other property, plant and equipment
Rotable assets
Engines
Plant and equipment
Land and buildings
Leasehold improvements
Motor vehicles
Furniture and fittings
Computer equipment
Opening
accumulated
depreciation and
impairment
$’000
Disposals /
Reclassification
$’000
Depreciation
charge for the year
$’000
Impairment
$’000
Closing
accumulated
depreciation and
impairment
$’000
(85,772)
7,110
(9,875)
(14,548)
(2,521)
(6,118)
(4,991)
(1,196)
(1,373)
(941)
(1,845)
(33,533)
29
317
408
-
78
15
85
513
1,445
8,555
(3,035)
(555)
(1,100)
(854)
(47)
(178)
(70)
(251)
(6,090)
(15,965)
(15,972)
(2,374)
(5,085)
(4,223)
(1,154)
(1,223)
(880)
(1,671)
4,294
334
63
-
-
38
19
16
(2,870)
(481)
(1,096)
(768)
(42)
(188)
(80)
(190)
-
-
-
-
-
-
-
-
-
-
-
(88,537)
(17,554)
(2,759)
(6,810)
(5,845)
(1,165)
(1,536)
(926)
(1,583)
(38,178)
(126,715)
-
-
-
-
-
-
-
-
-
(14,548)
(2,521)
(6,118)
(4,991)
(1,196)
(1,373)
(941)
(1,845)
(33,533)
total property, plant and equipment
(119,305)
(69,957)
2,610
(10,081)
(8,344)
(85,772)
At 30 June 2017
Aircraft
Other property, plant and equipment
Rotable assets
Engines
Plant and equipment
Land and buildings
Leasehold improvements
Motor vehicles
Furniture and fittings
Computer equipment
Other property, plant and equipment
Opening net
carrying amount
$’000
Closing net
carrying amount
$’000
108,572
96,712
56,950
61,719
3,650
7,185
5,360
5,078
24,982
30,315
212
175
1,130
1,038
167
154
495
1,208
92,946
106,872
total property, plant and equipment
201,518
203,584
At 30 June 2016
Aircraft
Other property, plant and equipment
Rotable assets
Engines
Plant and equipment
Land and buildings
Leasehold improvements
Motor vehicles
Furniture and fittings
Computer equipment
Other property, plant and equipment
125,987
108,572
47,330
56,950
3,148
3,650
5,867
5,360
23,978
24,982
173
212
1,213
1,130
192
167
456
495
82,357
92,946
total property, plant and equipment
208,344
201,518
No impairment loss has been recognised over items of property, plant and equipment during the year (2016: $8,344 thousand).
Other property, plant and equipment
(32,582)
4,764
(5,715)
total property, plant and equipment
(102,539)
7,374
(15,796)
(8,344)
(119,305)
49
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
50
09 gOOdWiLL ANd OThER iNTANgiBLE AssETs
At 30 June 2017
Cost
Accumulated amortisation
Net carrying amount
total goodwill and other intangible assets
reconciliation
Goodwill
$’000
Software and
development costs
$’000
518
2,158
-
(1,823)
518
335
853
(A)
fAiR vALUE LEss cOsT TO sELL: AiRcRAfT AssETs
The recoverable amount of Air Link CGU was fair value less cost to sell. Cost to sell has been estimated at 10% of the fair value of
the aircraft. The fair value of Air Link has been determined based on sales price per industry database and independent valuations
of similar aircraft.
(B)
vALUE-iN-UsE: REx ANd PEL-AiR cgUs
The recoverable amount of Pel-Air and REX CGUs has been determined based on value-in-use calculations.
The value in use calculations of Rex and Pel-Air use cash flow projections based on financial budgets approved by the Board
covering a 5 year forecast period, and a terminal value based upon an extrapolation of cash flows beyond the 5 year period using a
constant growth rate which does not exceed the long term inflation rate. The cash flows are based on management’s expectations
regarding the market, fleet plans including the purchase of aircraft and operating costs. The discount rate applied reflects the
weighted average cost of capital based on the risk-free rate for ten year Australia government bonds adjusted for a risk premium to
reflect the risk of each CGU.
At 1 July 2016, net of accumulated amortisation
518
508
KEy AssUmPTiONs
Additions
Amortisation at 30 June 2017
-
130
-
(303)
At 30 June 2017, net of accumulated amortisation
518
335
total goodwill and other intangible assets
853
At 30 June 2016
Cost
Accumulated amortisation
Net carrying amount
518
2,344
-
(1,836)
518
508
The following key assumptions were used in determining the value-in-use valuation models for the Rex and Pel-Air CGUs:
Key Assumptions
(i) Discount rate
(ii) Revenue growth
(iii) Fuel cost escalation
(iv) Operating cost escalation
Rex CGU
11.0%
1.5%
1.0%
1.5%
Pel-Air CGU
10.5%
1.5%
1.0%
1.5%
(i) Post-tax discount rate applied to the cash flow projections.
(ii) Revenue growth based on historical experience and market conditions, fleet plans and competitor behaviour.
(iii) The fuel cost escalation has been set with regard to the prevailing purchase price of fuel to the extent fuel costs
total goodwill and other intangible assets
1,026
cannot be recovered from customers.
reconciliation
At 1 July 2015, net of accumulated amortisation
7,133
760
Additions
Impairment
Amortisation at 30 June 2016
-
88
(6,615)
-
-
(340)
(iv) Operating cost escalation has been estimated with regard to CPI adjustment for domestic costs and prevailing spot
rate for overseas purchases.
As a result of the impairment testing performed at the CGU level, the Group assessed that the recoverable amount was greater than
carrying amount and no impairment loss on these CGUs has been recognised in the current year (FY2016: impairment of $6,615
thousand relating to Goodwill and $8,344 thousand relating to carrying value of aircraft assets held in Pel-Air CGU).
sENsiTiviTy ANALysis
At 30 June 2016, net of accumulated amortisation
518
508
total goodwill and other intangible assets
1,026
The Group has performed a sensitivity analysis by considering reasonable changes in key assumptions, including discount rate,
revenue growth, operating cost escalation, fuel cost escalation and capital expenditure.
imPAiRmENT TEsTiNg Of gOOdWiLL ANd NON-cURRENT A ssETs
The Group has identified the following Cash Generating Units (CGUs) for the purposes of assessing the carrying value of the
Group’s assets:
• Air Link Pty Limited (Air Link)
• Pel-Air Aviation Pty Limited (Pel-Air)
• Regional Express Holdings Limited (Rex)
Goodwill of $518 thousand has been allocated to Air Link CGU for impairment testing purpose (2016: $518 thousand).
recognised. Note (B) below provides more information.
The changes in the following table to assumptions used in the impairment review would, in isolation, lead to an increase or decrease
in the recoverable amount. Changes in one assumption could be accompanied by a change in another assumption, which may
increase or decrease the recoverable amount of the CGU.
Post tax discount rate %
Revenue %
Operating cost escalation %
Fuel cost escalation %
Capital expenditure %
Rex recoverable amount
Pel-Air recoverable amount
Increase/
Decrease by
(Decrease) / Increase
$’000
Increase / (Decrease)
$’000
(Decrease) / Increase
$’000
Increase / (Decrease)
$’000
0.5%
0.5%
0.5%
0.5%
5.0%
(8,891)
44,604
(34,068)
(5,184)
(270)
9,926
(43,807)
33,459
5,092
270
(685)
2,345
(1,612)
(22)
(131)
707
(2,283)
1,567
21
131
51
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
52
10 TRAdE ANd OThER PAyABLEs
13 PROvisiONs
Current
Trade payables
Other payables
total
2017
$’000
8,919
9,411
18,330
2016
$’000
15,461
10,451
25,912
Trade payables are non-interest bearing and are normally settled on 7 to 30-day terms. Other payables are non-interest bearing and have
an average term of 7 to 30 days.
11 UNEARNEd REvENUE
Current
Unearned passenger and charter revenue
Unearned training revenue
total
12 BORROWiNgs
Current
Loan facility
Finance leases
Non-current
Loan facility
Finance leases
Effective
interest rate %
9.1%
3.9%
9.1%
3.9%
2017
$’000
22,640
58
22,698
2017
$’000
3,214
3,861
7,075
11,591
4,960
16,551
2016
$’000
19,283
58
19,341
2016
$’000
2,935
3,706
6,641
14,805
8,833
23,638
The loan facility was used by a subsidiary, VAA Pty Ltd, to fund a number of aircraft assets. The loan is repayable over 10 years from
July 2011 to June 2021.
The finance leases were for purchase of Saab aircraft. The aircraft has been part of the operational fleet and was acquired at their
lease end in March 2014. During the year, the Group refinanced and extended lease terms for the purchase of a number of aircraft.
The refinanced leases expire in August 2019.
The liabilities are secured over the assets being funded, the carrying value of which exceeds the outstanding liabilities.
Current
employee benefits
Profit share, pilot retention bonus
Annual leave and long service leave
Non-current
employee benefits
Long service leave
2017
$’000
2016
$’000
3,247
1,911
3,925
3,502
7,172
5,413
1,371
1,857
total employee benefits provisions
8,543
7,270
Profit share, pilot retention bonus
Balance at the beginning of the year
Arising during the year
Utilised
Transfer from / (to) share gift accrual
Balance at the end of the year
Annual leave and long service leave
Balance at the beginning of the year
Arising during the year
Utilised
Balance at the end of the year
14 issUEd cAPiTAL
Fully paid ordinary shares
Balance at 1 July
Balance at 30 June
1,911
2,786
2,145
1,160
(862)
(1,603)
53
(432)
3,247
1,911
5,359
4,845
6,785
7,586
(6,848)
(7,072)
5,296
5,359
2017
No. ’000
110,155
110,155
$’000
No. ’000
$’000
2016
72,024
110,155
72,024
110,155
72,024
72,024
Share units held as reserved shares by subsidiary company was 2,766,067 (2016: 1,308,911).
53
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
54
15 REsERvEd shAREs ANd OThER REsERvEs
17 dividENds
Reserved share account represents on market purchase of shares by the Group which is eventually granted to executives and
employees as part of their remuneration.
The share-based payments reserve arises on the grant of shares to executives and employees under the employee share gift plan.
Amounts are transferred out of the reserve and into issued capital when the shares are issued. Rex has established the share gift
plan for its executive directors and eligible employees since FY 06.
The board decided that this plan will be offered to EA groups that opt for the plan, and all non-EA employees who are not the
subject of an adverse recommendation by the Remunerations, Nominations and Disciplinary Committee. This plan is not based
on any performance measures as it was established to show its recognition of employees’ contribution to Rex by providing an
opportunity to share in its future growth and profitability and to align the interests of the employees more closely with the interests
of the shareholders.
Eligible employees who accept an offer of shares under the share plan will be entitled to receive the equivalent of 2% of their base
salary in shares each financial year. Such shares will be issued to eligible employees on the relevant award dates. Non eligible
employees are given the opportunity to salary sacrifice amounts to acquire Rex shares, with allocation of shares equal to 2% of the
their base salary.
In respect of financial year ended 30 June 2017, the directors have recommended a fully franked final dividend of 10 cents per
share be paid to holders of fully paid ordinary shares (2016: nil). This has not been included as a liability in these financial statements
and the dividend will be paid to all shareholders on the Register of Members. The total estimated dividend to be paid is $11,015
thousand (2016: nil).
The movement in the franking account balance, including impact for dividends declared after the year end, is noted below:
Adjusted franking account balance
37,574
33,705
Franking credit / (debit) recognised that will arise from income tax
payable / (receivable) as at the end of financial year
1,172
1,069
Impact on franking account balance of dividends not recognised
(4,721)
-
2017
$’000
2016
$’000
Cash flow hedge reserve
Balance at 1 July
Revaluation of cash flow hedges, net of tax
Balance at 30 June
General reserve
Balance at 1 July
Movement during the period
Balance at 30 June
total other reserves
2017
$’000
2016
$’000
678
-
(629)
678
49
678
1,590
1,590
-
-
1,590
1,590
1,639
2,268
The cash flow hedge reserve represents hedging gains and losses recognised on the effective portion of cash flow hedges. The cumulative
deferred gain or loss on the hedge is recognised in profit or loss when the hedged transaction impacts the profit or loss, or is included as
a basis adjustment to the non-financial hedged item, consistent with the applicable accounting policy.
The general reserve is used from time to time to transfer profits from retained profits. There is no policy of regular transfer.
16 EARNiNgs PER shARE
Basic earnings / (loss) per share
Diluted earnings / (loss) per share
2017
Cents per share
2016
Cents per share
11.7
(8.8)
11.7
(8.8)
The earnings / (loss) used in the calculation of basic and diluted earnings / (loss) per share are as follows:
Net profit / (loss)
2017
$’000
2016
$’000
12,620
(9,557)
Earnings / (loss) used in the calculation of basic earnings / (loss) per share
12,620
(9,557)
Earnings / (loss) used in the calculation of diluted earnings / (loss) per share
12,620
(9,557)
The weighted average number of ordinary shares used in the calculation of basic and diluted earnings / (loss) per share are as follows
Weighted average number of ordinary shares for the purpose of basic earnings / (loss) per share
107,644
108,447
Weighted average number of ordinary shares for the purpose of diluted earnings / (loss) per share
107,644
108,447
2017
No. ‘000
2016
No. ‘000
18 cOmmiTmENTs fOR ExPENdiTURE
(A) cAPiTAL ExPENdiTURE cOmmiTmENTs
Property, plant and equipment
Not later than one year
Later than one year and not later than five years
(B) fiNANcE LEAsE LiABiLiTiEs
2017
$’000
-
-
-
2016
$’000
7,053
-
7,053
Some aircraft were purchased under finance leases. The leases expire in August 2019. The Group takes ownership of the aircraft at
the end of the lease terms. The Group’s obligations under the finance leases are secured by the lessors’ title to the leased aircraft.
The fair value of the finance lease liabilities is approximately equal to their carrying amount.
Minimum lease payments
Present value of minimum lease payments
Not later than one year
Later than one year and not later than five years
Less future finance charges
Present value of minimum lease payments
Included in the consolidated financial statements as (Note 12)
Current borrowings
Non-current borrowings
2017
$’000
4,140
5,120
9,260
(439)
8,821
2016
$’000
4,140
9,314
13,454
(915)
12,539
2017
$’000
3,861
4,960
8,821
-
8,821
3,861
4,960
8,821
2016
$’000
3,706
8,833
12,539
-
12,539
3,706
8,833
12,539
55
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
56
19 cONTiNgENT LiABiLiTiEs ANd cONTiNgENT AssETs
22 NOTEs TO ThE cONsOLidATEd sTATEmENT Of cAsh fLOWs
There are no contingent liabilities nor contingent assets as at 30 June 2017 (2016: nil).
(A) REcONciLiATiON Of cA sh ANd cAsh EQUivALENTs
For the purposes of the statement of cash flows, cash and cash equivalents include cash on hand and in banks and investments in
money market instruments, net of outstanding bank overdrafts. Cash and cash equivalents at the end of the financial year as shown
in the statement of cash flows is reconciled to the related items in the statement of financial position as follows:
20 sUBsidiARiEs
Name of entity
Parent entity
Regional Express Holdings Limited
subsidiaries
Regional Express Pty Limited
Rex Freight & Charter Pty Limited
Rex Investment Holdings Pty Limited
Air Link Pty Limited
Pel-Air Aviation Pty Limited
Australian Airline Pilot Academy Pty Limited
VAA Pty Ltd
Country of incorporation
2017
2016
Cash and bank balances
Ownership Interest %
(B) REcONciLiATiON Of PROfiT / (LOss) f OR ThE yEAR
TO NET cAsh fLOWs fROm OPERATiNg AcTiviTiEs
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Regional Express Holdings Limited is the head entity within the tax-consolidated group. These subsidiary companies are members of the
tax-consolidated group.
21 AcQUisiTiON Of BUsiNEss
No business was acquired during the year.
2017
$’000
26,257
2017
$’000
2016
$’000
26,821
2016
$’000
12,620
(9,557)
16,268
16,136
-
8,344
-
6,615
1,355
1,327
(65)
(55)
154
(95)
(770)
(721)
(246)
2,634
(1,681)
(2,794)
965
(1,105)
1,218
(1,814)
103
993
(66)
136
(4,386)
6,969
1,273
737
(629)
678
26,113
28,428
2017
Used
$’000
14,809
8,870
-
-
-
4,117
84
27,880
Limit
$’000
15,064
9,339
2,900
559
1,000
4,237
620
33,719
2016
Used
$’000
17,743
12,556
2,500
-
-
3,829
52
36,680
Limit
$’000
17,976
13,000
2,900
559
1,000
3,937
620
39,992
Profit / (loss) for the year
Depreciation and amortisation
Asset impairment
Goodwill impairment
Share-based payment
Unrealised foreign exchange gain
Loss / (gain) on disposal of non-current assets
Interest received
(Increase) / decrease in receivables
Increase in inventories
Decrease / (increase) in other financial assets
Increase / (decrease) in deferred tax
Increase in current tax payable
(Decrease) / increase in other financial liabilities
(Decrease) / increase in trade payables
Increase in provisions
(Decrease) / increase in other liabilities
Net cash flows from operating activities
(c) fiNANciNg fAciLiTiEs
Maximum facilities available and reviewed annually:
Loan facility (fund aircraft purchases)
Leases (fund aircraft purchases)
Tape negotiations authority
Letter of credit
Set off
Guarantee
Credit card
57
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
58
The facilities are secured by the Group’s operating cash flows and properties located in Adelaide, New South Wales at Don Kendell Drive
Forest Hill, and Robey Street Mascot.
23 fiNANciAL iNsTRUmENTs
(A) cAPiTAL RisK mANAgEmENT
The Group manages its capital to ensure that the entities in the Group will be able to continue as a going concern while maximising
the return to stakeholders.
The Group’s overall strategy remains unchanged from 2016.
The capital structure of the Group consists of debt as disclosed in Note 12 and attributable to equity holders of the parent comprising
issued capital, reserves as disclosed in Notes 14, 15 respectively, and retained earnings.
Operating cash flows are used to acquire assets required for the Group’s operations, tax, dividends, share buy-backs and repayment
of maturing debt. The Group’s policy is to borrow centrally only if required.
gEARiNg RATiO
The Group’s Board reviews the capital structure on a semi-annual basis. As a part of this review the Board considers the cost of capital
and the risks associated with each class of capital. The Board will balance its overall capital structure through the payment of dividends,
new share issue and share buy-backs as well as the issue of new debt or the redemption of existing debt.
The Group’s financing facilities include a $29 million loan facility which is fixed-interest bearing and repayable over 10 years from
July 2012 to June 2021.
During FY 14, the Group finalised the purchase of 25 latest generation Saab 340Bplus aircraft. These aircraft were originally operating in
the Rex fleet under a lease. The acquisition was partly funded by operating cash flows with the rest from bank finance leases.
The net cash position at the end of the financial year was as follows:
2017
$’000
2016
$’000
23,626
30,279
(d)
fOREigN cURRENcy RisK mANAgEmENT
The Group undertakes certain transactions denominated in USD, hence exposures to exchange rate fluctuations arise. Exchange
rate exposures are managed using forward foreign exchange contracts.
The carrying amount of the Group’s foreign currency denominated monetary assets and monetary liabilities at the end of the financial
year is as follows:
Liabilities
2017
USD$’000
2016
USD$’000
Assets
2017
USD$’000
2016
USD$’000
1,448
3,427
-
-
fOREigN cURRENcy sENsiTiviTy ANALysis
The Group is mainly exposed to USD for the following main purchases, approximate amounts per annum are:
• USD 17 million for engineering purchases
• USD 17 million for engine care and maintenance
• USD 4 million for airline reservation systems usage
• USD 1 million for aircraft insurance policies
• USD 1 million for operating leases
The following table details the Group’s sensitivity to a 10% increase and 10% decrease in the Australian Dollar against the USD. The
sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end
for a 10% change in foreign currency rates. For a weakening of the Australian Dollar against the respective currency there would be an
equal and opposite impact on the profit and other equity, and the balances below would be negative.
Profit or loss
190
470
2017
$’000
2016
$’000
Debt (i)
Cash and cash equivalents
26,257
26,821
The Group’s sensitivity to foreign currency has remained constant
Excess cash and cash equivalents over debt / (net debt)
2,631
(3,458)
fORWARd fOREigN ExchANgE cONTRAcTs
Equity (ii)
196,445
186,108
The Group may enter into forward foreign exchange contracts to manage the risk associated with anticipated sales and purchase
transactions up to twelve months and up to 100% of the exposure generated. Basis adjustments are made to the carrying amounts
of non-financial hedged items when the anticipated sale or purchase transaction takes place.
Excess cash / (net debt) to equity ratio
1.3%
(1.9%)
(E) fUEL PRicE RisK mANAgEmENT
(i) Debt is defined as long- and short-term borrowings, as detailed in Note 12.
(ii) Equity includes all capital and reserves of the Group that are managed as capital.
(B) cATEgORiEs Of fiNANciAL iNs TRUmENTs
Financial assets
Loans and receivables
Cash and bank balances
Derivative financial instruments
Available-for-sale financial assets
Financial liabilities
Amortised cost
Derivative financial instruments
2017
$’000
2016
$’000
16,046
15,470
26,257
26,821
140
1,105
9
9
41,956
56,191
70
136
(c)
fiNANciAL RisK mANAgEmENT OBJEcTivEs
The Group is exposed to foreign exchange, fuel price, interest rate and liquidity risk. Management of these risks is governed by
the Group’s policy approved by the Board of Directors, which provides written principles on the management of financial risks.
Compliance with policies and exposure limits is reviewed by the Audit and Corporate Governance Committee and the Board on an
ongoing basis. The Group does not enter into trade financial instruments, including derivative financial instruments, for speculative
purposes. The Treasury function, which co-ordinates the hedging of financial risks from time to time, is managed by the Group’s
Corporate Services Department and reports regularly to the Board and Audit and Corporate Governance Committee.
The Group uses jet fuel swap contracts to hedge exposure to movements in the price of aviation fuel. Jet fuel swaps are taken out to
hedge exposures to a maximum of 12 months in accordance with the Group’s risk management policies. The group uses fuel swaps
linked to the Platts Singapore Kerosene benchmark to hedge exposures to jet fuel.
The following table sets out the timing of the notional amount and the hedged jet fuel price of the Group’s fuel hedging instruments:
Hedged price
$ per L
Notional amount
L’000
Less than 1 year
L’000
1 to 2 years
L’000
2 to 5 years
L’000
AUD fuel costs
2017
2016
0.4830
0.5088
19,898
30,000
19,898
30,000
-
-
-
-
59
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
60
The following table details the sensitivity of the Group’s financial assets and liabilities to a 20% increase and 20% decrease in the
jet fuel price. A positive number indicates an increase in profit or loss and other equity where the jet fuel price weakens. For an
increase in the jet fuel price there would be an equal and opposite impact on the profit and other equity, and the balances below
would be negative. This analysis assumes that all other variables remain constant and based on the designated hedge relationship
at the reporting date.
(J)
fAiR vALUE hEiRARchy
The table below analyses financial instruments carried at fair value. The different levels have been defined as follows:
• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
• Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices)
20% increase
20% decrease
or indirectly (i.e. derived from prices); and
2017
Derivative asset – jet fuel swap
Derivative liability – jet fuel swap
2016
Derivative asset – jet fuel swap
Derivative liability – jet fuel swap
Carrying amount
$’000
Profit/(loss)
$’000
140
(70)
70
1,015
(136)
969
-
-
-
-
-
-
Equity
$’000
1,092
830
1,922
2,978
73
3.051
Profit/(loss)
$’000
-
-
-
-
-
-
Equity
L’000
(1,092)
(830)
(1,922)
(2,978)
(73)
(3,051)
(f) iNTEREsT RATE RisK mANAgEmENT
The Group has very little exposure to interest rate risk as its borrowings detailed in Note 12 are at a fixed interest rate. As such the
Group does not hedge its interest rate exposure. The Group’s exposures to interest rates on financial assets and financial liabilities
are detailed in the liquidity risk management section of this note.
(g) cREdiT RisK mANAgEmENT
The Group has limited exposure to credit risk as the majority of its revenue is derived from sales made through credit cards where
counterparties are either banks or the credit card companies. The disputes to the credit card charges amount to less than $50,000 a year.
The Group does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar
characteristics. The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are banks with high
credit-ratings assigned by international credit-rating agencies
(h) LiQUidiTy RisK mANA gEmENT
Ultimate responsibility for liquidity risk management rests with the Board of Directors, who has built an appropriate liquidity risk
management framework for the management of the Group’s short, medium and long-term funding and liquidity management
requirements. The Group’s operating activities generate positive annual cash flow. The Group tries to maintain a $10 million cash
balance by the end of each financial year. As and when required, the Group uses financing facilities as detailed in Note 22.
LiQUidiTy ANd iNTEREsT RisK TABLEs
The following tables detail the Group’s remaining contractual maturity for its non-derivative financial liabilities. The amounts disclosed
are based on the contractual undiscounted principal and interest cash flows of financial liabilities based on the earliest date on which
the Group can be required to pay. The table includes both interest and principal cash flows.
2017
Non-interest bearing
Interest bearing
2016
Non-interest bearing
Interest bearing
1 month
$’000
1-3 months
$’000
3 months to a year
$’000
1-5 years
$’000
5+ years
$’000
18,330
369
18,699
25,912
369
26,281
-
1,774
1,774
-
1,774
1,774
-
6,429
6,429
-
6,429
6,429
-
18,414
18,414
-
27,040
27,040
-
-
-
-
-
-
The interest-bearing liabilities have a weighted average effective interest rate of 9.1% per annum for the 10-year bank loan (FY2012
to FY2021), and 3.9% per annum for the bank finance leases maturing in August 2019.
(i)
fAiR vALUE Of fiNANciAL iNsTRUmENTs
• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
There were no transfers between levels during the year.
Level 1
$’000
Level 2
$’000
Level 3
$’000
30 June 2017
Financial assets carried at fair value
Derivative asset – jet fuel swap
Financial liabilities carried at fair value
Derivative liability – jet fuel swap
30 June 2016
Financial assets carried at fair value
Derivative asset – jet fuel swap
Financial liabilities carried at fair value
Derivative liability – jet fuel swap
-
-
-
-
140
(70)
1,105
(136)
-
-
-
-
Total
$’000
140
(70)
1,105
(136)
For financial instruments not quoted in active markets, the Group uses valuation techniques such as present value, comparison to
similar instruments for which market observable prices exist and other relevant models used by market participants. These valuation
techniques use both observable and unobservable market inputs.
Fuel swap hedging contracts are financial instruments that use valuation techniques with only observable market inputs and are
included in Level 2 above. Future cash flows are estimated based on forward rates (from observable forward rates at the end of the
reporting period) and contract forward rates, discounted at a rate that reflects the credit risk of various counterparties.
The Group does not have any Level 3 financial instruments.
24 KEy mANAgEmENT PERsONNEL cOmPENsATiON
The aggregate compensation made to directors and other members of key management personnel of the Group is set out below:
Short-term benefits
Post-employment benefits
Other long-term benefits
Share-based payment
2017
$
1,714,548
146,191
23,969
25,261
1,909,969
2016
$
1,795,312
159,860
27,326
26,726
2,009,224
25 RELATEd PARTy TRANsAcTiONs
(A) EQUiTy iNTEREsTs iN sUBsidiARiEs
Details of interests in subsidiaries are disclosed in Note 20 to the consolidated financial statements.
(B) TRANsAcTiONs WiTh KEy mANA gEmENT PERsONNEL
Except as disclosed below, the Directors consider that the carrying amounts of the financial assets and financial liabilities recorded
at the amortised cost in the financial statements approximate their fair values.
(i) KEy mANAgEmENT PERsONNEL cOmPENsATiON
Details of key management personnel compensation are disclosed in Note 24 to the consolidated financial statements.
(ii) LOANs TO KEy mANAgEmENT PERsONNEL
There have been no loans made to key management personnel.
61
REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
62
26 REmUNERATiON Of AUdiTORs
Other segment information for the year is as follows:
Depreciation and amortisation
Additions to non-current assets
Audit and review of the consolidated financial statements
Other non-audit services - tax compliance, tax advice
The auditor of the Group is Deloitte Touche Tohmatsu.
2017
$’000
315,000
37,800
352,800
2016
$’000
285,075
73,617
358,692
Continuing operations
Regular public transport
Charter
2017
$’000
11,178
5,090
16,268
2016
$’000
10,557
5,579
16,136
2017
$’000
20,097
479
20,576
27 EvENTs AfTER ThE REPORTiNg PERiOd
In July 2017, Rex announced it had been awarded the route licence to operate passenger services from Adelaide to Port Augusta by
the South Australian Government. Rex will be commencing services between Adelaide and Port Augusta from 11 September 2017. The
schedule will provide three weekly roundtrip services on Mondays, Tuesdays and Thursdays from Adelaide to Port Augusta and return. This
service will stimulate and provide ease of access to business and opens tourism to domestic and international visitors.
A further 21 Vietnamese cadet pilots are expected to commence training at AAPA over September and October 2017, with more expected
in the remainder of the FY.
Pel-Air has secured FIFO contracts with Iluka Resources and Cobham based out of Adelaide. The charter flights will commence in July and
August 2017 respectively and operate several times a week to Jacinth-Ambrosia and to Prominent Hill using the Saab 340 aircraft. The
availability of Rex assets in Adelaide enabled Pel-Air to offer the charter services at short notice and clinch the contracts.
28 sEgmENT iNfORmATiON
AASB 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly
reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its performance.
Information reported to the Group’s Chief Executive Officer for the purposes of resource allocation and assessment of performance is more
specifically focused on the category of customer for each type of service.
The Group’s reportable segments under AASB 8 are as follows:
• Regular public transport
• Charter
The accounting policies of the reportable segments are the same as the Group’s accounting policies.
The following is an analysis of the Group’s revenue and results by reportable operating segment for the year:
Revenue
2017
$’000
257,984
22,983
280,967
2016
$’000
237,044
24,862
261,906
Continuing operations
Regular public transport
Charter
Finance income
Other gains / (losses)
Central administration costs and directors’ salaries
Finance costs
Profit / (loss) before tax
Tax (expense) / benefit
Consolidated segment revenue and profit
280,967
261,906
Segment result
2017
$’000
24,048
2,313
26,361
770
194
(7,540)
(1,975)
17,810
(5,190)
12,620
2016
$’000
3,871
(5,784)
(1,913)
721
(250)
(7,090)
(2,171)
(10,703)
1,146
(9,557)
The revenue reported above represents revenue generated from external customers. There were no intersegment sales.
Segment result represents the profit earned by each segment without allocation of central administration costs and directors’
salaries. This is the measure reported to the chief operating decision maker for the purposes of resource allocation and assessment
of segment performance.
The following is an analysis of the Group’s assets and liabilities by reportable operating segment as at the end of the year:
Continuing operations
Regular public transport
Charter
total assets / liabilities
63
REGIONAL EXPRESS HOLDINGS LIMITED
Assets
2017
$’000
213,100
59,708
272,808
2016
$’000
207,208
63,309
270,517
Liabilities
2017
$’000
45,329
31,034
76,363
2016
$’000
50,168
34,241
84,409
2016
$’000
19,664
435
20,099
2016
$’000
47,443
163,880
211,323
50,794
1,909
52,703
72,024
84,220
1,382
678
316
158,620
46
678
724
29 PARENT ENTiTy discLOsUREs
(A) FiNANCiAl PositioN
Assets
Current assets
Non-current assets
total assets
liabilities
Current liabilities
Non-current liabilities
total liabilities
equity
Issued capital
Retained earnings
Share-based payments reserve
Cash flow hedge reserve
General reserve
total equity
(B) FiNANCiAl PerFormANCe
Profit for the year
Other comprehensive (loss) / income
total comprehensive income
2017
$’000
48,091
170,410
218,501
48,258
2,099
50,357
72,024
94,555
1,200
49
316
168,144
10,335
(629)
9,706
(c)
gUARANTEEs ENTEREd iNTO By ThE PARENT ENTiTy iN RELATiON TO ThE dEBT s Of
iTs sUBsidiARiEs
During FY 11, the parent entity entered into a deed of cross guarantee in relation to the debts of Pel-Air Aviation Pty Ltd, Rex Freight
and Charter Pty Ltd, Rex Investment Holdings Pty Ltd and Australian Airline Pilot Academy Pty Ltd.
By entering into the deed, the wholly owned entities have been relieved from the requirements to prepare a financial report and directors’
report under Class Order 98/1418 (as amended) issued by the Australian Securities and Investments Commission (‘ASIC’).
The above companies represent a ‘Closed Group’ for the purposes of the Class Order, and as there are no other parties to the Deed of
Cross Guarantee that are controlled by Regional Express Holdings Limited, they also represent the ‘Extended Closed Group’.
The statement of profit or loss and other comprehensive income and statement of financial position of the ‘Closed Group’ can be found
in the consolidated statement of profit or loss and other comprehensive income and statement of financial position along with the note
on Regional Express Holdings Limited as parent found in note 29 (A) and (B).
(d)
cONTiNgENT LiABiLiTiEs Of ThE PARENT ENTiTy
As at 30 June 2017, no contingent liabilities or assets existed (2016: nil).
(E)
cOmmiTmENTs fOR ThE AcQUisiTiON Of PROPERTy, PLANT ANd EQUiP mENT By ThE
PARENT ENTiTy
As at 30 June 2017, the parent entity has no commitment for the acquisition of property, plant and equipment.
REGIONAL EXPRESS HOLDINGS LIMITED
64
30 sigNificANT AccOUNTiNg POLiciEs
(A)
sTATEmENT Of cOmPLiANcE
These financial statements are general purpose financial statements which have been prepared in accordance with the Corporations
Act 2001, Accounting Standards and Interpretations, and comply with other requirements of the law. The financial statements include
the consolidated financial statements of the Group. For the purpose of preparing the consolidated statements, the Company is a
for-profit entity.
Accounting Standards include Australian Accounting Standards. Compliance with Australian Accounting Standards ensures that the
financial statements and notes of the Group comply with International Financial Reporting Standards (‘IFRS’).
The financial statements were authorised for issue by the directors on 29 August 2017
(B)
BAsis Of PREPARATiON
The consolidated financial statements have been prepared on the basis of historical cost, except for the revaluation of certain
financial instruments that are measured at revalued amounts or fair values, as explained in the accounting policies below. Historical
cost is based on the fair values of the consideration given in exchange for assets. All amounts are presented in Australian dollars,
unless otherwise noted.
In accordance with Legislative Instrument 2016/191 issued by the Australian Securities and Investments Commission relating to the
rounding off of amounts in the financial statements amounts in the financial statements have been rounded to the nearest hundred
thousand dollars in accordance with that Legislative Instrument, unless otherwise indicated.
(c)
BAsis Of cONsOLidATiON
(d)
REvENUE
Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for rebates and other
similar allowances.
RENdERiNg Of sERvicEs
Revenue from providing air passenger, charter and freight services is recognised when the relevant flights are made.
dividENd ANd iNTEREsT iNcOmE
Dividend from investments is recognised when the shareholder’s right to receive payment has been established provided that it is
probable that the economic benefits will flow to the Group and the amount of income can be measured reliably.
Interest income from or financial assets is recognised when it is probable that the economic benefits will flow to the Group and the
amount of revenue can be measured reliably.
Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable,
which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s
net carrying amount on initial recognition.
(E)
BORROWiNg cOsTs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that
necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until
such time as the assets are substantially ready for their intended use or sale.
The consolidated financial statements incorporate the financial statements of the Company and entities (including structured entities)
controlled by the Company and its subsidiaries. Control is achieved when the Company:
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is
deducted from the borrowing costs eligible for capitalisation.
(f)
cAsh ANd cAsh EQUivALENTs
Cash comprises cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments that are readily
convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
Bank overdrafts are shown within borrowings in current liabilities in the consolidated statement of financial position.
(g)
fOREigN cURRENciEs
The individual financial statements of each Group entity are presented in its functional currency being the currency of the primary
economic environment in which the entity operates. For the purpose of the consolidated financial statements, the results and financial
position of each entity are expressed in Australian dollars (‘$’), which is the functional currency of the Group and the presentation
currency for the consolidated financial statements.
In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s functional currency are
recorded at the rates of exchange prevailing on the dates of the transactions. At each balance date, monetary items denominated
in foreign currencies are retranslated at the rates prevailing at the balance date. Non-monetary items carried at fair value that are
denominated in foreign currencies are retranslated at the rates prevailing on the date when the fair value was determined. Non-
monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Exchange differences are recognised in profit or loss in the period in which they arise except for exchange differences on transactions
entered into in order to hedge certain foreign currency risks (refer to Note 23).
• has power over the investee;
• is exposed, or has rights, to variable returns from its involvement with the investee; and
• has the ability to use its power to affect its returns.
The Company 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 listed above. When the Company has less than a majority of the voting rights of an investee,
it has power over the investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities of the
investee unilaterally. The Company considers all relevant facts and circumstances in assessing whether or not the Company’s voting
rights in an investee are sufficient to give it power, including:
• the size of the Company’s holding of voting rights relative to the size and dispersion of holdings of the other vote holders;
• potential voting rights held by the Company, other vote holders or other parties;
• rights arising from other contractual arrangements; and any additional facts and circumstances that indicate that the Company has, or
does not have, the current ability to direct the relevant activities at the time that decisions need to be made, including voting patterns
at previous shareholders’ meetings.
Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses
control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of during the year are included
in the consolidated statement of profit or loss and other comprehensive income from the date the Company gains control until
the date when the Company ceases to control the subsidiary. Profit or loss and each component of other comprehensive income
are attributed to the owners of the Company and to the non-controlling interests. Total comprehensive income of subsidiaries is
attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having
a deficit balance.
When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the
Group’s accounting policies. All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions
between members of the Group are eliminated in full on consolidation.
Changes in the Group’s ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are
accounted for as equity transactions. The carrying amounts of the Group’s interests and the non-controlling interests are adjusted
to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling
interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributed to owners
of the Company.
When the Group loses control of a subsidiary, a gain or loss is recognised in profit or loss and is calculated as the difference between
(i) the aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous carrying
amount of the assets (including goodwill), and liabilities of the subsidiary and any non-controlling interests. All amounts previously
recognised in other comprehensive income in relation to that subsidiary are accounted for as if the Group had directly disposed
of the related assets or liabilities of the subsidiary (i.e. reclassified to profit or loss or transferred to another category of equity as
specified/permitted by applicable AASBs). The fair value of any investment retained in the former subsidiary at the date when control
is lost is regarded as the fair value on initial recognition for subsequent accounting under AASB 139, when applicable, the cost on
initial recognition of an investment in an associate or a joint venture.
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66
(h)
dERivATivE fiNANciAL iNsTRUmENTs
EffEcTivE iNTEREsT mEThOd
The Group enters into jet fuel swap derivatives to hedge exposures to jet fuel prices. It is the Group’s policy not to enter into or hold
derivative financial instruments for speculative trading purposes. Derivative financial instruments are recognised at fair value both
initially and on an ongoing basis. Transaction costs attributable to the derivative are recognised in profit or loss when incurred.
hEdgE AccOUNTiNg
The Group designates certain derivatives as hedges of highly probable forecast transactions (cash flow hedges). At the inception of the
hedge, the Group documents the relationship between hedging instruments and hedged items, including the risk management objective
and strategy for undertaking each hedge. The Group also documents its assessment, both at hedge inception and on an ongoing basis,
of whether the hedging instruments that are used in hedge transactions have been and will continue to be highly effective.
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges are recognised in other
comprehensive income and accumulated under the heading of cash flow hedge reserve. The gain or loss relating to the ineffective portion
is recognised immediately in profit or loss as part of other gains and losses.
Amounts deferred in equity are recycled in profit or loss in the periods when the hedged item is recognised in profit or loss. However, when
the forecast transaction that is hedged results in the recognition of a non-financial asset or a non-financial liability, the gains and losses
previously deferred in equity are transferred from equity and included in the initial measurement of the cost of the asset or liability.
Hedge accounting is discontinued when the Group revokes the hedging relationship, the hedging instrument expires or is sold, terminated,
or exercised, or no longer qualifies for hedge accounting. Any cumulative gain or loss deferred in equity at that time remains in equity and
is recognised when the forecast transaction is ultimately recognised in profit or loss. When a forecast transaction is no longer expected to
occur, the cumulative gain or loss that was deferred in equity is recognised immediately in profit or loss.
Any derivative financial instruments not designated into an effective hedge relationship are classified as a current asset or a current liability
at fair value through profit and loss.
(i)
EmPLOyEE BENEfiTs
A liability is recognised for benefits accruing to employees in respect of wages and salaries, annual leave, long service leave, and
sick leave when it is probable that settlement will be required and they are capable of being measured reliably.
Liabilities recognised in respect of short term employee benefits are measured at their nominal values using the remuneration rate
expected to apply at the time of settlement.
Liabilities recognised in respect of long term employee benefits are measured as the present value of the estimated future cash
outflows to be made by the Group in respect of services provided by employees up to reporting date.
(J)
fiNANciAL iNsTRUmENTs
Financial assets and financial liabilities are recognised when a group entity becomes a party to the contractual provisions of
the instrument.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the
acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value
through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate,
on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value
through profit or loss are recognised immediately in profit or loss.
Investments are recognised and derecognised on trade date where the purchase or sale of an investment is under a contract
whose terms require delivery of the investment within the timeframe established by the market concerned, and are initially
measured at fair value, net of transaction costs except for those financial assets classified as at fair value through profit or loss
which are initially measured at fair value.
Other financial assets are classified into the following specified categories: financial assets ‘at fair value through profit or loss’,
‘available-for-sale’ financial assets, and ‘loans and receivables’. The classification depends on the nature and purpose of the
financial assets and is determined at the time of initial recognition.
The effective interest method is a method of calculating the amortised cost of a financial asset and of allocating interest income over
the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected
life of the financial asset, or, where appropriate, a shorter period, to the net carrying amount on initial recognition.
Income is recognised on an effective interest rate basis for debt instruments other than those financial assets ‘at fair value through
profit or loss’.
fiNANciAL AssETs AT fAiR vALUE ThROUgh PROfiT OR LOss
Financial assets are classified as financial assets at fair value through profit or loss where the financial asset:
(i)
(ii)
has been acquired principally for the purpose of selling in the near future;
i s a part of an identified portfolio of financial instruments that the Group manages together and has a recent actual pattern
of short-term profit-taking; or
(iii)
is a derivative that is not designated and effective as a hedging instrument.
Financial assets at fair value through profit or loss are stated at fair value, with any resultant gain or loss recognised in profit or loss.
The net gain or loss recognised in profit or loss incorporates any dividend or interest earned on the financial asset.
Fair value is determined in the manner described in Note 23.
AvAiLABLE-fOR-sALE fiNANciAL AssETs
Certain shares and redeemable notes held by the Group are classified as being available-for-sale and are stated at fair value.
Fair value is determined in the manner described in Note 23. Gains and losses arising from changes in fair value are recognised
directly in the investments revaluation reserve with the exception of impairment losses, interest calculated using the effective
interest method and foreign exchange gains and losses on monetary assets which are recognised directly in profit or loss.
Where the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously recognised in the
investments revaluation reserve is included in profit or loss for the period.
Dividends on available-for-sale equity instruments are recognised in profit and loss when the Group’s right to receive payments
is established.
LOANs ANd REcEivABLEs
Trade receivables, loans, and other receivables that have fixed or determinable payments that are not quoted in an active market
are classified as ‘loans and receivables’. Loans and receivables are measured at amortised cost using the effective interest method
less impairment.
Interest is recognised by applying the effective interest rate.
imPAiRmENT Of fiNANciAL A ssETs
When an available for sale asset is considered to be impaired, cumulative gains/losses previously recognised in other comprehensive
income are reclassified to profit or loss in the period.
Financial assets, other than those at fair value through profit or loss, are assessed for indicators of impairment at each balance date.
Financial assets are impaired where there is objective evidence that as a result of one or more events that occurred after the initial
recognition of the financial asset the estimated future cash flows of the investment have been impacted. For financial assets carried
at amortised cost, the amount of the impairment is the difference between the asset’s carrying amount and the present value of
estimated future cash flows, discounted at the original effective interest rate.
The carrying amount of financial assets including uncollectible trade receivables is reduced by the impairment loss through the use
of an allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account.
Changes in the carrying amount of the allowance account are recognised in profit or loss.
With the exception of available-for-sale equity instruments, if, in a subsequent period, the amount of the impairment loss decreases
and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised
impairment loss is reversed through profit or loss to the extent the carrying amount of the investment at the date the impairment is
reversed does not exceed what the amortised cost would have been had the impairment not been recognised.
In respect of available-for-sale equity instruments, any subsequent increase in fair value after an impairment loss is recognised
directly in equity.
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68
dEREcOgNiTiON Of fiNANciAL A ssETs
(m) gOvERNmENT gRANTs
The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the
financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the Group neither transfers nor
retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognises its
retained interest in the asset and an associated liability for amounts it may have to pay. If the Group retains substantially all the risks
and rewards of ownership of a transferred financial asset, the Group continues to recognise the financial asset and also recognises
a collateralised borrowing for the proceeds received.
On derecognition of a financial asset in its entirety, the difference between the asset’s carrying amount and the sum of the consideration
received and receivable and the cumulative gain or loss that had been recognised in other comprehensive income and accumulated
in equity is recognised in profit or loss.
On derecognition of a financial asset other than in its entirety (e.g. when the Group retains an option to repurchase part of a
transferred asset), the Group allocates the previous carrying amount of the financial asset between the part it continues to recognise
under continuing involvement, and the part it no longer recognises on the basis of the relative fair values of those parts on the
date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognised and the sum
of the consideration received for the part no longer recognised and any cumulative gain or loss allocated to it that had been
recognised in other comprehensive income is recognised in profit or loss. A cumulative gain or loss that had been recognised in
other comprehensive income is allocated between the part that continues to be recognised and the part that is no longer recognised
on the basis of the relative fair values of those parts.
(K)
fiNANciAL LiABiLiTiEs ANd EQUiTy iNs TRUmENTs
cLAssificATiON Of dEBT OR EQUiTy
Debt and equity instruments are classified as either liabilities or as equity in accordance with the substance of the contractual
arrangement. An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its
liabilities. Equity Instruments issued by the Group are recorded at the proceeds received, net of direct issue costs.
fiNANciAL LiABiLiTiEs
Financial liabilities are classified as either financial liabilities ‘at fair value through profit or loss’ or other financial liabilities.
fiNANciAL LiABiLiTiEs AT fAiR vALUE ThROUgh PROfiT OR LOss
Financial liabilities at fair value through profit or loss are stated at fair value, with any resultant gain or loss recognised in profit or loss.
The net gain or loss recognised in profit or loss incorporates any interest paid on the financial liability. Fair value is determined in the
manner described in Note 23.
OThER fiNANciAL LiABiLiTiEs
Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs.
Other financial liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense
recognised on an effective yield basis.
The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense
over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the
expected life of the financial liability, or, where appropriate, a shorter period, to the net carrying amount on initial recognition.
(L)
gOOdWiLL
Goodwill acquired in a business combination is carried at cost established at date of the acquisition of the business less
accumulated impairment losses if any.
For the purpose of impairment testing, goodwill is allocated to each of the Group’s cash-generating units (CGUs), or groups of
CGUs, expected to benefit from the synergies of the business combination. CGUs (or groups of CGUs) to which goodwill has
been allocated are tested for impairment annually, or more frequently if events or changes in circumstances indicate that goodwill
might be impaired.
If the recoverable amount of the CGU (or group of CGUs) is less than the carrying amount of the CGU (or groups of CGUs), the
impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the CGU (or groups of CGUs) and
then to the other assets of the CGU (or groups of CGUs) pro-rata on the basis of the carrying amount of each asset in the CGU
(or groups of CGUs). An impairment loss recognised for goodwill is recognised immediately in profit or loss and is not reversed
in a subsequent period.
On disposal of an operation within a CGU, the attributable amount of goodwill is included in the determination of the profit or loss
on disposal of the operation.
Government grants are assistance by the government in the form of transfers of resources to the Group in return for past or future
compliance with certain conditions relating to the operating activities of the entity. Government grants include government assistance
where there are no conditions specifically relating to the operating activities of the Group other than the requirement to operate in
certain regions or industry sectors.
Government grants are not recognised until there is reasonable assurance that the Group will comply with the conditions attaching
to them and that the grants will be received. Government grants are recognised in profit or loss on a systematic basis over the
periods in which the Group recognises as expenses the related costs for which the grants are intended to compensate. Specifically,
government grants whose primary condition is that the Group should purchase, construct or otherwise acquire non-current assets
are recognised as deferred revenue in the statement of financial position and transferred to profit or loss on a systematic and rational
basis over the useful lives of the related assets.
Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving
immediate financial support to the Group with no future related costs are recognised in profit or loss in the period in which they
become receivable.
The benefit of a government loan at a below-market rate of interest is treated as a government grant, measured as the difference
between proceeds received and the fair value of the loan based on prevailing market interest rates.
Government assistance which does not have conditions attached specifically relating to the operating activities of the entity is
recognised in accordance with the accounting policies above.
(N)
imPAiRmENT Of OThER TANgiBLE ANd iNTANgiBLE A ssETs OThER ThAN gOOdWiLL
At each reporting date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is
any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset
is estimated in order to determine the extent of the impairment loss (if any). Where the asset does not generate cash flows that are
independent from other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Where a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-
generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent
allocation basis can be identified.
Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment annually and
whenever there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash
flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of
money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of
the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised in profit or loss immediately,
unless the relevant asset is carried at fair value, in which case the impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised
estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that
would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior years. A reversal of
an impairment loss is recognised in profit or loss immediately, unless the relevant asset is carried at fair value, in which case the reversal
of the impairment loss is treated as a revaluation increase.
(O)
TAxATiON
Income tax expense represents the sum of the tax currently payable and deferred tax.
cURRENT TAx
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit before tax as reported in the
consolidated statement of profit or loss and other comprehensive income/statement of profit or loss because of items of income or
expense that are taxable or deductible in other years and items that are never taxable or deductible. The Group’s liability for current
tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.
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70
dEfERREd TAx
(R)
LEAsiNg
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the consolidated
financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are
generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary
differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences
can be utilised. Such deferred tax assets and liabilities are not recognised if the temporary difference arises from goodwill or from
the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the
taxable profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences associated with investments in subsidiaries and associates,
and interests in joint ventures, except where the Group is able to control the reversal of the temporary difference and it is probable
that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary
differences associated with such investments and interests are only recognised to the extent that it is probable that there will be
sufficient taxable profits against which to utilise the benefits of the temporary differences and they are expected to reverse in the
foreseeable future.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no
longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled
or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting
period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in
which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax liabilities and assets are offset when there is a legally enforceable right to set off current tax assets against current
tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current
tax assets and liabilities on a net basis.
cURRENT ANd dEfERREd TAx f OR ThE PERiOd
Current and deferred tax are recognised in profit or loss, except when they relate to items that are recognised in other comprehensive
income or directly in equity, in which case the current and deferred tax are also recognised in other comprehensive income or directly
in equity, respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect
is included in the accounting for the business combination.
(P)
iNTANgiBLE AssETs
iNTANgiBLE AssETs AcQUiREd sEPARATELy
Intangible assets with finite lives that are acquired separately are recorded at cost less accumulated amortisation and impairment
losses. Amortisation is charged on a straight-line basis over their estimated useful lives. The estimated useful life and amortisation
method is reviewed at the end of each annual reporting period, with any changes in these accounting estimates being accounted
for on a prospective basis. Intangible assets with indefinite lives that are acquired separately are carried at cost less accumulated
impairment losses.
A summary of the policies applied to the Group’s finite intangible assets is as follows:
Intangible asset
Amortisation method used
Computer software
4 years straight line
Impairment test / recoverable amount testing
where an indicator of impairment exists
(Q)
iNvENTORiEs
Inventories are valued at the lower of cost and net realisable value. Costs of inventories are determined on a first in first out basis. Net
realisable value represents the estimated selling price less all estimated costs of completion and costs necessary to make the sale.
Leases are classified as finance leases when the terms of the lease transfer substantially all the risks and rewards incidental to
ownership to the lessee. All other leases are classified as operating leases.
gROUP As LEssOR
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs
incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a
straight line basis over the lease term.
gROUP As LEssEE
Assets held under finance leases are initially recognised at their fair value or, if lower, at amounts equal to the present value of the
minimum lease payments, each determined at the inception of the lease. The corresponding liability to the lessor is included in the
statement of financial position as a finance lease obligation.
Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant rate
of interest on the remaining balance of the liability. Finance charges are recognised immediately in profit and loss, unless they
are directly attributable to qualifying assets, in which case they are capitalised in accordance with the Group’s general policy on
borrowing costs. Refer to Note 30E. Contingent rentals are recognised as expenses in the periods in which they are incurred.
Finance leased assets are amortised on a straight line basis over the estimated useful life of the asset.
Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except where another
systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred.
In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The
aggregate benefits of incentives are recognised as a reduction of rental expense on a straight-line basis, except where another
systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
(s)
PROPERTy, PLANT ANd EQUiPmENT
Land and buildings, plant and equipment, leasehold improvements and equipment under finance lease are stated at cost less
accumulated depreciation and impairment. Cost includes expenditure that is directly attributable to the acquisition of the item. In the
event that settlement of all or part of the purchase consideration is deferred, cost is determined by discounting the amounts payable
in the future to their present value as at the date of acquisition.
Depreciation is provided on property, plant and equipment, including freehold buildings but excluding land. Depreciation is calculated
on a straight line basis so as to write off the net cost of each asset over its expected useful life to its estimated residual value.
Leasehold improvements are depreciated over the period of the lease or estimated useful life, whichever is the shorter, using the
straight line method. The estimated useful lives, residual values and depreciation method are reviewed at the end of each annual
reporting period, with the effect of any changes recognised on a prospective basis.
The rates applied are as follows:
Aircraft
Building
15,000 to 60,000 hours
20 to 40 years
Computer Equipment
4 to 6 years
Engines
Furniture & Fittings
10 to 20 years
8 to 10 years
Leasehold Improvements
over the unexpired lease period
Motor Vehicles
Plant & Equipment
7 years
8 years
Rotable Assets
5 to 20 years
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise
from the continued use of the asset. Any gain or loss arising in the disposal or retirement of an item of property, plant and equipment
is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss.
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diREcTORs’ dEcLARATiON
The directors declare that:
(a)
(b)
(c)
in the directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and
when they become due and payable;
t he attached financial statements are in compliance with International Financial Reporting Standards, as stated in Note 30
to the consolidated financial statements;
in the directors’ opinion, the attached financial statements and notes thereto are in accordance with the Corporations
Act 2001, including compliance with accounting standards and giving a true and fair view of the financial position and
performance of the consolidated entity; and
(d)
the directors have been given the declarations required by s.295A of the Corporations Act 2001.
At the date of this declaration, the Company is within the class of companies affected by ASIC Class Order 98/1418. The nature of
the deed of cross guarantee is such that each company which is party to the deed guarantees to each creditor payment in full of
any debt in accordance with the deed of cross guarantee.
In the directors’ opinion, there are reasonable grounds to believe that the Company and the companies to which the ASIC Class
Order applies, as detailed in Note 29 to the financial statements will, as a group, be able to meet any obligations or liabilities to which
they are, or may become, subject by virtue of the deed of cross guarantee.
Signed in accordance with a resolution of the directors made pursuant to s.295 (5) of the Corporations Act 2001.
On behalf of the Directors
Neville Howell
Chief Operating Officer
Sydney, 29 August 2017
(T)
PROvisiONs
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable
that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at reporting
date, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cashflows
estimated to settle the present obligation, its carrying amount is the present value of those cashflows (where the effect of the time
value of money is material).
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the
receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can
be measured reliably.
(U)
shARE-BAsEd PAymENTs
Equity-settled share-based payments with employees and others providing similar services are measured at the fair value of the
equity instrument at the grant date. Details regarding the determination of the fair value of the equity-settled share-based transactions
are set out in Note 15.
The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over
the vesting period, based on the Group’s estimate of shares that will eventually vest with and corresponding to increase in equity.
Equity-settled share-based payment transactions with other parties other than employees are measured at the fair value of the goods
and services received, except where the fair value cannot be estimated reliably, in which case they are measured at the fair value of
the equity instruments granted, measured at the date the entity obtains the goods or the counterparty renders the service.
For cash-settled share-based payments, a liability is recognised for the goods or services acquired, measured initially at the fair value
of the liability. At the end of each reporting period until the liability is settled, and the date of settlement, the fair value of the liability is
measured, with any changes in fair value recognised in profit or loss for the year.
(v)
gOOds ANd sERvicEs TAx
Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except:
i.
ii.
where the amount of GST incurred is not recoverable from the taxation authority, it is recognised as part of the cost of
acquisition of an asset or as part of an item of expense; or
for receivables and payables which are recognised inclusive of GST.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables.
Cash flows are included in the statement of cash flows on a gross basis. The GST component of cash flows arising from investing
and financing activities which is recoverable from, or payable to, the taxation authority is classified as operating cash flows.
(W) REsTATEmENT
In the year ended 30 June 2015, the Group undertook construction and development of a warehouse on properties located at
66 Robey Street and 79 Baxter Road, Mascot 2020, which was completed during the current financial year. On completion of the
warehouse, the Group reviewed the asset register and discovered the capitalised value of the buildings that were demolished as part of
the development were not written off in the year ended 30 June 2015. The net book value of the buildings written off was $1,350,000.
Comparative information has been restated according to AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors,
paragraph 42 in relation to the net book value of the buildings. This restatement results in a decrease to property plant and equipment
of $1,350,000, an increase deferred tax liabilities of $405,000 and a decrease in retained earnings of $945,000.
The following table summarises the impact of the individual line items in the financial statements:
Consolidated Statement of
Financial Position
Property, plant & equipment
Deferred tax liability
Total net assets
Retained earnings
Total equity
30 June 2016
as previously
reported
$’000
202,868
807
187,053
112,995
187,053
Adjustment
$’000
30 June 2016
as restated
$’000
(1,350)
201,518
(405)
(945)
(945)
(945)
402
186,108
112,050
186,108
1 July 2015
as previously
reported
$’000
209,694
2,793
194,841
122,552
194,841
Adjustment
$’000
(1,350)
(405)
(945)
(945)
(945)
1 July 2015
as restated
$’000
208,344
2,388
193,896
121,607
193,896
No change to the net profit of the comparative year has been required as a result of this restatement.
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74
iNdEPENdENT AUdiTOR’s REPORT
Deloitte Touche Tohmatsu
A.B.N. 74 490 121 060
Grosvenor Place
225 George Street
Sydney NSW 2000
PO Box N250 Grosvenor Place
Sydney NSW 1220 Australia
Tel: +61 (0) 2 9322 7000
Fax: +61 (0) 2 9322 7001
www.deloitte.com.au
Independent Auditor’s Report to the Members of
Regional Express Holdings Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Regional Express Holdings Limited (the “Company”) and
its subsidiaries (the “Group”), which comprises the consolidated statement of financial position
as at 30 June 2017, consolidated statement of profit or loss and other comprehensive income,
consolidated statement of changes in equity and consolidated statement of cash flows for the
year then ended, and notes to the financial statements, including a summary of significant
accounting policies and other explanatory information, 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 2017 and of its
financial performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities
under those standards are further described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report. We are independent of the Group in accordance with the
auditor independence requirements of the Corporations Act 2001 and the ethical requirements
of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for
Professional Accountants (the Code) that are relevant to our audit of the financial report in
Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has
been given to the directors of the Company, would be in the same terms if given to the directors
as at the time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most
significance in our audit of the financial report for the current period. These matters were
addressed in the context of our audit of the financial report as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on these matters.
Key Audit Matter
How the scope of our audit addressed
the Key Audit Matter
Valuation of unearned revenue
As at 30 June 2017, the Group recognised
unearned revenue of $22.698 million in the
financial
statement
consolidated
position.
of
The Group’s calculation of unearned
revenue in respect of flights purchased but
not yet flown requires significant judgment,
requiring significant volumes of data from
flight booking systems and passenger
reports to be analysed and matched, along
with estimated adjustments to unearned
revenue such as the level of no-shows.
Our procedures included, but were not
limited to:
Assessing
the accounting policies
adopted by the Group in relation to
revenue recognition;
Testing a sample of controls in the
determination of unearned revenue;
Testing the integrity of the flight
booking
systems and passenger
reports by comparing a sample of flight
information to the cash receipt and
flight data;
Agreeing the inputs in the reconciliation
of unearned revenue to external flight
booking systems; and
Challenging the assumptions used by
management in relation to the rate of
no-shows to assess the no-show
revenue to be recognised in profit or
loss.
We also assessed the appropriateness of the
disclosures in Note 4, Note 11 and Note 30
to the financial statements.
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Touche Tohmatsu Limited.
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76
Key Audit Matter
How the scope of our audit addressed
the Key Audit Matter
Carrying value of aircraft and other
property plant & equipment
As at 30 June 2017 the Group has
recognised aircraft and other property
plant & equipment of $96.712 million and
in
the
$106.872 million
consolidated
financial
position.
respectively
statement
of
Management conducts impairment tests
annually (or more frequently if impairment
indicators
the
recoverability of the carrying value of
aircraft and other property, plant &
equipment.
assess
exist)
to
Impairment indicators are assessed with
reference either to the asset in question or
the cash-generating unit (CGU) to which
the asset relates. The Group has identified
three CGUs for the purposes of assessing
the carrying value of aircraft and other
property, plant & equipment:
Air Link Pty Limited (Air Link)
Pel-Air Aviation Pty Limited (Pel-Air);
and
Regional Express Holdings Limited
(REX).
The Group measures the recoverable
amount of the CGUs through either a fair
value less cost to model (Air Link) or a
value in use model (Pel-Air and REX).
As disclosed in Note 9 to the financial
statements, there are a number of key
estimates made which require significant
judgement in determining the inputs into
these models which include:
Growth rates for revenue, operating
costs and fuel costs;
Capital expenditure; and
Discount rate.
Our procedures included, but were not
limited to:
Assessing identification of the CGUs and
indicators of
determining whether
impairment exist;
Assessing management’s assertions
and estimates regarding estimated
useful lives and residual values using
valuation reports published by third
party specialists, industry data and the
Group’s historical experience and future
operating plans;
Challenging the assumptions used in
management’s impairment analysis by
assessing
of
management’s past estimates and
taking into account recent industry
developments and each CGU’s future
operating plans;
reliability
the
Assessing the reasonableness of the
basis adopted by management
in
determining the other key inputs and
assumptions underlying the calculations
in the models;
Performing sensitivity analysis on the
key model inputs and assumptions; and
Assessing
the
reasonableness of
management’s calculations of the fair
value of aircraft assets.
We also assessed the appropriateness of the
disclosures in Note 9 to the financial
statements.
Other Information
The directors are responsible for the other information. The other information comprises the
information included in the annual report for the year ended 30 June 2017, but does not include
the financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent
with the financial report or our knowledge obtained in the audit or otherwise appears to be
materially misstated. If, based on the work we have performed, we conclude that there is a
material misstatement of this other information; we are required to report that fact. We have
nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for
such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether
due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the Group’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless the directors either intend to liquidate the
Group or to cease operations, or have no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole
is free from material misstatement, whether due to fraud or error, and to issue an auditor’s
report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a
guarantee that an audit conducted in accordance with the Australian Auditing Standards will
always detect a material misstatement when it exists. Misstatements can arise from fraud or
error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise
professional judgement and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial report, whether
due to fraud or error, design and perform audit procedures responsive to those risks,
and obtain audit evidence that is sufficient and appropriate to provide a basis for our
opinion. The risk of not detecting a material misstatement resulting from fraud is higher
than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty
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REGIONAL EXPRESS HOLDINGS LIMITED
REGIONAL EXPRESS HOLDINGS LIMITED
78
exists related to events or conditions that may cast significant doubt on the Group’s
ability to continue as a going concern. If we conclude that a material uncertainty exists,
we are required to draw attention in our auditor’s report to the related disclosures in the
financial report or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the Group to cease to continue
as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including
the disclosures, and whether the financial report represents the underlying transactions
and events in a manner that achieves a fair presentation.
We communicate with the directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and
other matters that may reasonably be thought to bear on our independence, and where
applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of
most significance in the audit of the financial report of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation
precludes public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to outweigh the public interest benefits
of such communication.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 23 to 24 of the Directors’ Report
for the year ended 30 June 2017.
In our opinion, the Remuneration Report of Regional Express Holdings Limited, for the year
ended 30 June 2017, complies with section 300A of the Corporations Act 2001.
Responsibilities
The Directors of Regional Express Holdings Limited are responsible for the preparation and
presentation of the Remuneration Report in accordance with section 300A of the Corporations
Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our
audit conducted in accordance with Australian Auditing Standards.
DELOITTE TOUCHE TOHMATSU
Jamie Gatt
Partner, Chartered Accountants
Sydney, 29 August 2017
This PAgE hAs BEEN iNTENTiONALLy LEfT BLANK
79
REGIONAL EXPRESS HOLDINGS LIMITED
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80
Asx AddiTiONAL iNfORmATiON As AT 22 sEPTEmBER 2017
This is required by the ASX, but falls outside of the audit opinion and therefore has no impact on the audit report issued.
NUmBER Of hOLdERs Of EQUiTy sE cURiTiEs
Ordinary share capital
110,154,375 fully paid ordinary shares are held by 2,036 individual shareholders.
All issued ordinary shares carry one vote per share and carry the rights to dividends.
disTRiBUTiON Of hOLdERs Of EQUiTy sE cURiTiEs
Fully Paid ordinary shares
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
total
Unmarketable Parcels
sUBsTANTiAL shAREhOLdERs
ordinary shareholders
MR KIM HAI LIM
MR JOE TIAU TJOA
THIAN SOO LEE
MING YEW SEE TOH & HUI ING TJOA
JOO CHYE CHUA
REX INVESTMENT HOLDINGS PTY LIMITED
investors
659
984
164
175
54
2,036
204
securities
356,116
2,669,325
1,301,400
5,063,481
100,764,053
110,154,375
27,288
Fully Paid
Number
18,998,346
16,234,094
7,722,181
7,454,362
7,454,362
5,993,231
TWENTy LARgEsT hOLdERs Of QUOTEd EQUiTy sE cURiTiEs
Fully Paid
ordinary shareholders
MR KIM HAI LIM
MR JOE TIAU TJOA
THIAN SOO LEE
MING YEW SEE TOH & HUI ING TJOA
JOO CHYE CHUA
REX INVESTMENT HOLDINGS PTY LIMITED
MS HUI LING TJOA
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
LAY KHIM NG
ANACACIA PTY LTD
J P MORGAN NOMINEES AUSTRALIA LIMITED
CITICORP NOMINEES PTY LIMITED
PACIFIC CUSTODIANS PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED-GSCO ECA
MR MICHAEL KARL KORBER
STRATEGIC VALUE PTY LTD
STRATEGIC VALUE PTY LIMITED
MR THIAN SONG TJOA
MR GUY FARROW
B & R JAMES INVESTMENTS PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD
Number
18,998,346
16,234,094
7,722,181
7,454,362
7,454,362
5,993,231
5,755,513
5,187,473
3,727,181
3,687,773
1,737,592
1,668,577
1,588,386
1,564,308
1,245,000
1,093,615
1,037,958
800,000
561,616
500,000
469,208
issued Capital (%)
0.32
2.42
1.18
4.60
91.48
100.00
0.02
Percentage
17.25
14.74
7.01
6.77
6.77
5.44
Percentage
17.25
14.74
7.01
6.77
6.77
5.44
5.22
4.71
3.38
3.35
1.58
1.51
1.44
1.42
1.13
0.99
0.94
0.73
0.51
0.45
0.43
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REGIONAL EXPRESS HOLDINGS LIMITED
82
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REGIONAL EXPRESS HOLDINGS LIMITED