ANNUAL REPORT
2024
For personal use only
CONTENTS
Chairman’s Report ……………………………………………………………………………………………………………………..
1
Managing Director’s Report ……………………………………………………………………………………….………………
2
Directors' Report …………………………………………………………………………………………..…………………..…….…
5
Auditor’s Independence Declaration………………………………………………………..………………………………….
22
Consolidated Statement of Comprehensive Income …………………………………..……………………...………
23
Consolidated Statement of Financial Position ………………………………………………………………….…………
25
Consolidated Statement of Changes in Equity ……………………………………………………………...……………
26
Consolidated Statement of Cashflows …………………………………………………………………..……………………
27
Notes on the Financial Statements …..………………………………………………………………………………………..
28
Directors’ Declaration …………………………………………………………………………………..…..…..…………………..
69
Independent Auditor's Report …………………………………………………………………….…………………..…………
70
Corporate Governance Statement ……………………………………………………..……….…………………..…..……
74
Shareholder Information ……………………………………………………………………………………………………………
75
Corporate Directory ……………………………………………………………………………………………….…………….….…
77
RPMGlobal Holdings Limited
ABN 17 010 672 321
For personal use only
CHAIRMAN’S REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |1
Dear Fellow Shareholders,
Financial Year 2024 ("FY2024") was another
year dominated by global events and economic
challenges that impacted our staff and
customers in one way or another. However,
through it all, the company grew revenue across
the business, including an 16% increase in
software subscription license revenue.
During FY2024, the company concluded $77.0
million in new software license sales (herein
referred to as Total Contracted Value "TCV"), up
$6.5 million (9%) on FY2023 TCV sales of $70.5
million.
Due to the growth in software TCV sales, at the
end of FY2024, the company had $161.0 million
in pre-contracted non-cancellable software
licence and maintenance revenue, which will be
recognised across future years, up $28.8 million
from the same time last year.
Earnings before interest depreciation and
amortisation (EBITDA) grew $3.3 million (28%)
in FY2024 to $15.3 million (FY2023: $12.0
million).
The business's consistent profitable growth
over the last few years has resulted in the
company's share price closing at $2.87 on 30
June 2024, up 95% from the beginning of the
financial year. It is pleasing to see our
shareholders being rewarded for their patience
as the company transitioned its software sales
model to a subscription basis.
Notwithstanding the significant increase in the
share price over the past twelve months, the
RPM Board is still of the view that the
company's share price remains undervalued.
Accordingly, in May 2024, the Board resolved to
extend
the
company's
on-market
share
buyback for a further twelve months. As at the
close of business on 30 June 2024, the company
had acquired a total of 12.9 million shares via
the on-market buyback (since its inception in
June 2022) at an average cost of $1.667 per
share for a total cost of $21.6 million.
The company began FY2024 with 228,022,637
shares on issue and, as a result of options being
exercised and shares being bought back on the
market, at the end of FY2024, the company had
223,255,967 shares on issue.
There have been no changes in the composition
of the Board or executive management team
during the year.
The company continues to maintain a strong
balance sheet with $34.2 million of cash in the
bank as at 30 June 2024 and no debt.
The Board has again resolved not to pay a
dividend this financial year. The company still
has minimal franking credits (less than $0.3
million) and until it starts producing these, it
views buying back shares as the most
appropriate form of capital management.
I would again like to acknowledge the effort and
commitment of our staff, who once again grew
both our Advisory and Software businesses.
The Board also thanks its shareholders for their
ongoing support. We remain firmly of the
opinion that the investments made in our
software by the company will support and grow
the business well into the future.
Stephen Baldwin
Chairman
For personal use only
MANAGING DIRECTOR’S REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |2
Market Commentary
The world is undergoing a significant shift in
energy systems, driven by the need to reduce
greenhouse gas emissions and achieve net-
zero targets. This transition requires massive
investments in renewable energy sources,
such as solar, wind, hydro, and energy storage
and transmission technologies, such as
batteries, hydrogen, and grid infrastructure.
These investments are expected to be
multigenerational and will create a surge in
demand for various commodities, especially
metals and minerals, essential for producing
and operating these technologies.
The supply of these commodities is not
guaranteed, as they face various challenges,
such as declining ore grades, geopolitical risks,
environmental
and
social
impacts,
and
regulatory uncertainties. Moreover, in a
rapidly
deglobalising
world,
the
trade
environment is becoming more complex and
volatile as countries seek to secure their access
to strategic resources and protect their
domestic industries. The combination of rising
demand and constrained supply is likely to
create a new commodity supercycle, not
driven by a singular economy but by competing
global demand.
A notable strategic realignment is occurring as
Western nations pivot from trade with China
and adopt more protectionist policies. Recent
policy changes in these countries have focused
on reshaping the battery supply chain,
reducing reliance on Chinese materials, and
promoting near-and-friend-shoring strategies.
Metals markets in the energy transition will
likely see more constrained availability (via
restricted
trade
access
and
resource
nationalism) compounded by limited mine
supply. A duplication and regionalisation of
metals markets is entirely possible.
Meeting ambitious climate goals set by
governments under the Paris Accord will
require a six-fold increase in the production of
critical minerals. Even if the speed of this
energy transition is overstated by half, the
trained professionals needed to find and
extract these minerals do not exist today,
especially as the baby boomer generation
retires from the industry. This remains a key
demand growth opportunity for companies
like ours, which really understand mining
(Advisory division) and have technical mining
software solutions (Software division).
High Level Summary of Financial Results
In FY2024, the company reported total
revenue of $113.3 million, a 15% increase
($14.9 million) over the previous year ($98.4
million).
Advisory revenue increased by 20% ($6.2
million) to $37.5 million (FY2023: $31.3
million), and software revenue increased by
14% ($9.1 million) to $75.2 million (FY2023:
$66.1 million).
The company sold $77.0 million in software in
FY2024 (FY2023: $70.5 million), $75.4 million
in subscription licenses (FY2023: $65.8 million)
and $1.6 million in perpetual licenses with new
contracted maintenance (FY2023: $4.7 million)
generating $9.2 million in new Annually
Recurring Revenue (ARR).
As of 1 July 2024, the total value of software
ARR was $62.0 million, comprising $50.7
million from subscriptions and $11.3 million
from maintenance. As the company's software
becomes
more
mission-critical,
mining
companies are asking for longer subscription
terms to ensure certainty of supply. In the
second half of the 2024 financial year, the
company sold $18.4 million in software
subscriptions with a committed term of eight
years and $6.4 million with a committed term
of ten years.
It is important to understand that of the $75.4
million in software subscriptions sold in
FY2024, only $6.6 million (9%) was recognised
in the FY2024 financial accounts, with the
remaining $68.8 million to be reported as
revenue in future financial years.
As of the 30th of June 2024, the company had
$161.0
million
in
pre-contracted,
non-
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MANAGING DIRECTOR’S REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |3
cancellable, recurring software revenue, which
will be recognised in future years, up $28.8
million (22%) from the same time last year (30
June 2023: $132.2 million).
Of the company's operating costs, 76% relate
to employee salaries which increased year on
year by 11% ($6.7 million). This 11% consists of
3% ($1.8 million) related to the employment of
27 net new employees, 5% ($3.1 million)
related to FY2024 salary increases, and 3%
($1.8 million) flowed in from salary increases
from the previous year.
The company once again increased its
investment in software development, lifting its
spending by $0.9 million (5%) to $19.1 million
(FY2023: $18.2 million). Given its accelerating
market acceptance, the company’s XECUTE
product benefited the most from this
increased development spend.
Earnings before interest depreciation and
amortisation (EBITDA) grew $3.3 million (28%)
in FY2024 to $15.3 million (FY2023: $12.0
million).
Cash inflows from operations for the year were
$13.4 million.
Profit after Tax from continuing operations
increased by 71% ($4.4 million) to $10.6 million
(FY2023: $6.2 million).
Advisory
The Advisory division remains commodity and
region-agnostic with a global resourcing
model, which allows it to deliver projects
across countries, cultures and commodities,
using centres of excellence to maintain quality
supported by local client-facing specialists.
During the year, the Advisory team signed new
contracts worth $45.8 million, of which $9.5
million (20%) were for “Independent Engineer
to Lenders” engagements. We are actively
monitoring more than $10.4 billion of
construction capital across periods typically
ranging from four to eight years. During the
last year we have been actively involved in 31
projects supporting clients, their advisors, and
lenders in raising over $23 billion in project
capital.
RPM is now a global leader in reviewing both
upstream and downstream battery and critical
minerals projects, having gained significant
insight
into
the
emerging
extraction,
processing
and
refining
technologies
associated with these unique projects. In
FY2024, we actively supported over $8 billion
of battery and critical mineral project financing
worldwide. Many of these projects are world-
class and industry-leading in their technical
approach.
Our investment into ESG (Environment, Social
and Governance) realised strong returns last
year, with the ESG division securing several
significant long-term approval mandates for
some of Australia's emerging battery and
critical mineral projects. We were also
awarded a number of closure mandates for a
major iron ore producer in WA, which helped
support further organic growth late in the year.
The ability to deploy our own highly
experienced mining ESG specialists onto our
lenders and M&A mandates has certainly
improved our competitive positioning for
these mandates.
Our mining engineering team continues to
deliver mining studies globally, ranging from
concept to feasibility, leveraging our software
offering to add value to client's projects. Our
ability to bring together mine planning and
decarbonisation expertise through our ESG
team positions RPM strongly to support miners
as they develop carbon reduction strategies to
meet their decarbonisation and energy
transition commitments.
While demand remains strong, we will
continue to look to grow our Advisory business
for the foreseeable future.
Software
For the sixth year in a row, the company set a
new sales record with respect to software
licenses sold.
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MANAGING DIRECTOR’S REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |4
Included in the $77 million worth of software
sales were several initial pilot site projects for
some of the world’s largest miners. Success in
these pilots will open the door to further
license and service opportunities to deploy the
solution across multiple locations for these
customers worldwide.
Over the last six months, the company has
adjusted its software expansion strategy. Since
I started with the company in 2012, we have
been expanding our software footprint by
introducing new products that have either
been
developed
internally
or
acquired
externally. At the same time, we have been
extending the scope of each product to enable
it to be used in larger and more complex
businesses.
We are now confident that our products have
the core functional breadth, depth and
scalability needed to run complex multi-site
mining operations. Given the accelerated
market acceptance of our AMT (asset
management),
XECUTE
(ultra
short-term
planning)
and
ShiftManager
(Shift
Management)
solutions,
our
internal
development effort is now focused on
enhancements and new features requested by
our
customers
that
enhance
product
competitiveness, broaden our market appeal
and improve our financial performance.
While future product enhancements may well
be encouraged and supported by specific
customers or groups of customers, we will
continue to own the intellectual property of all
development undertaken by the company and
will make them available to the mining
industry at large as part of the commercial-off-
the-shelf (COTS) release of each solution.
We believe RPM is now the mining software
vendor of choice for surface miners and has
started making good inroads into the
underground mining space with its AMT and
XECUTE solutions.
Future Outlook
After a spectacular year of growth, the
Advisory division believes it can grow again in
FY2025, assuming no material change in the
mining industry fundamentals.
The company expects to set a new benchmark
for software sales in the upcoming year — our
seventh in a row. The impressive software
sales finish to the 2024 financial year has
provided the software consulting team with a
strong book of work to kick off the year.
We believe XECUTE, and ShiftManager will
both grow strongly, and our Americas region is
well positioned to significantly improve on its
FY2024 result.
The operating leverage provided by the $161
million in pre-contracted non-cancellable
software revenue will support EBITDA growth
and cash inflows in FY2025 and beyond, which
will most likely be used to continue the
company’s on-market share buyback program.
With a strong balance sheet, respected
advisory
business,
competitive
software
offerings, robust pipelines, and referenceable
customers, we are excited and optimistic
about the year ahead.
Richard Mathews
Managing Director and Chief Executive Officer
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |5
Your Directors present their report on RPMGlobal Holdings Limited (the “Company” or “RPM”) and its subsidiaries
(referred to hereafter as the “Group”) for the year ended 30 June 2024.
1.
Directors
The Directors of RPMGlobal Holdings Limited at any time during or since the end of the period were:
Non-executive
Stephen Baldwin – Chairman
Angeleen Jenkins
Paul Scurrah
Ross Walker
Executive
Richard Mathews – CEO and Managing Director
2.
Principal Activities
The Group’s principal activities during the financial year consisted of:
a)
Software licensing, consulting, implementation and support; and
b)
Technical, advisory and training services.
There were no significant changes in the nature of the Group’s principal activities during the financial year.
3.
Dividends
No dividends were paid or declared during the financial year (2023: nil).
4.
Review and Results of Operations
2024
2023
Change
$m
$m
%
Advisory
37.5
31.3
20%
Software
- Licence subscriptions
45.6
39.3
16%
- Maintenance and Support
12.4
13.7
-9%
- Consulting
12.8
10.2
25%
- Perpetual Licence Sales
1.3
2.9
-55%
- Other Income
3.1
-
n/a
Total Software
75.2
66.1
14%
Other Revenue
0.6
1.0
-40%
Total Revenue
113.3
98.4
15%
Direct Costs
(9.1)
(6.8)
34%
Net Revenue
104.2
91.6
14%
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DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |6
4.
Review and Results of Operations (Continued)
Analysis between IFRS and non-IFRS financial performance items used in the Directors Report is presented below:
2024
2023
Change
$m
$m
%
Net Revenue
104.2
91.6
14%
Operating Expenses
(88.9)
(79.6)
-12%
Underlying EBITDA
15.3
12.0
28%
Depreciation and Amortisation
(4.9)
(5.6)
13%
Net Finance costs
0.2
(0.2)
n/a
Profit before income tax
10.6
6.2
71%
Income tax expense
(1.5)
(1.1)
-36%
Underlying Profit
9.1
5.1
78%
Restructure costs
(0.5)
(1.4)
64%
Profit for the period
8.6
3.7
132%
Earnings Per Share from continuing operations (cents per share)
3.8
1.6
138%
1 Underlying Earnings before Interest, Tax, Depreciation, Amortisation and Restructure costs is a non-IFRS disclosure. In the opinion of the
Directors, the Group’s Underlying EBITDA reflects the results generated from ongoing operating activities and is calculated in accordance
with AICD/Finsia principles. The non-operating adjustments outlined above are considered to be non-cash and/or non-recurring in nature.
These items are included in the Group’s consolidated statutory result but excluded from the underlying result. Underlying EBITDA has not
been audited or reviewed.
Total Revenue grew by 15% to $113.3 million (2023: $98.4 million) mostly due to strong growth of advisory revenue
(20%) and software revenue (14%).
In November 2023 the Group received $3.1 million for the sale of its right to a future royalty stream for its
simulation software product.
Operating expenses increased by 12% to 88.9 million (2023: 79.6 million) due to an increase in headcount for
advisory and software consultants and the impact of current and prior-year annual salary increases.
EBITDA from operations increased by $3.3 million to $15.3 million (2023: $12.0 million).
The Group’s profit after tax increased by 132% to $8.6 million (2023: 3.7 million) and included $0.5 million in
redundancy costs to support the rebuilding of the software division in the Americas.
The Company bought back $12.7 million of its own shares (7.26 million shares) during the 2024 financial year.
As of 30 June, the Group had cash reserves of $34.2 million (2023: $34.8 million) and no bank debt.
Software Division
The Total Contracted Value (TCV2) of software subscriptions and perpetual licences with new maintenance sold
during 2024 was $77.0 million (2023: $70.5 million), of which only $8.0 million (10%) was recognised in 2024
revenue. As of 30 June 2024, the company had $161.0 million in pre-contracted non-cancellable software licence
and maintenance revenue to be recognised in future periods (2023: $132.2 million).
Software subscription revenue grew $6.3 million in 2024 financial year to $45.6 million (2023: $39.3 million). Some
of this growth came from customers converting their perpetual software licences to subscription licences, which
resulted in maintenance revenue decreasing by $1.3 million to $12.4 million (2023: $13.7 million).
Annual Recurring Revenue (ARR3) for subscription software licences and support (maintenance) revenue at year
end was $62.0 million (June 2023: $55.0 million).
2 Total Contracted Value is a non-IFRS disclosure. In the opinion of the Directors, the Group’s TCV better reflects software sales generated
from ongoing operating activities. TCV has not been audited or reviewed.
3 Annual Recurring Revenue is a non-IFRS disclosure. In the opinion of the Directors, the Group’s ARR better reflects software subscription
revenue from ongoing operating activities. ARR has not been audited or reviewed.
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |7
4.
Review and Results of Operations (Continued)
Software consulting revenue increased by $2.6 million (25%) to $12.8 million (2023: $10.2 million) due to the hiring
of software consultants.
The Group increased its investment in Research and Development (R&D) by $0.9 million lifting the total investment
in software R&D to $19.1 million (2023: $18.2 million). The company expenses all research and development costs.
Advisory Division
The Advisory division provides independent consulting and advisory services which cover technical and economic
analysis and assessment of mining activities and resources on behalf of mining companies, financial institutions,
government agencies and suppliers to mining projects. The market for Advisory services is heavily reliant on
expansion, development, financing and transacting of mining assets and projects.
Revenue from Advisory services for the year increased by $6.2 million (20%) to $37.5 million (2023: $31.3 million)
due to growth in both upstream and downstream battery and critical minerals projects.
5.
Likely Future Developments - Business Strategies and Prospects for Future Financial Years
After a strong year of growth, we expect the Advisory division will grow again in FY2025, assuming no material
change in the mining industry fundamentals.
The company has continued to invest significantly in its software products, resulting in a more complete and richer
set of products than last year. With the accelerated market acceptance of our XECUTE and ShiftManager products,
we are excited about the year ahead. The addition of software consulting capacity will enable us to manage more
software projects simultaneously.
The operating leverage provided by the $161.0 million in pre-contracted non-cancellable software revenue will
support earnings growth and cash inflows in FY2025 and beyond. We expect to continue the company’s on-market
share buyback program.
With a strong balance sheet, respected advisory business, competitive software offerings, robust pipelines, and
referenceable customers, we are excited and optimistic about the year ahead.
6.
Key risks and risk management
The company has a detailed risk management framework, that assesses the key financial and non-financial risks
that have the potential, should they occur, to result in significant consequences to the company. The framework is
integrated into the daily management of the business to ensure the oversight and management of business risks.
Further details of the risk management framework and processes are detailed in RPM’s Corporate Governance
Statement. Listed below are relevant key risks for the business identified in the risk management framework.
The company’s board and management understand the importance of maintaining a sound and practical system
of risk oversight, management and the associated internal controls. RPM maintains an Enterprise Risk Management
(ERM) Policy which is designed to protect its people, clients and assets including intellectual property and thereby
enhancing the value delivered to shareholders. The RPM ERM policy assists to identify, mitigate and manage risks
on an enterprise wide basis with the Board reviewing and updating key strategic risks impacting the company
annually.
During FY2024 the Board reviewed and updated the key strategic risks managed pursuant to the ERM. The key risks
faced by RPMGlobal Holdings Limited, and their associated controls have been established to manage those risks
are set out in the following table:
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DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |8
6.
Key risks and risk management (Continued)
Risk
Nature of Risk
Controls established
Cyber, Privacy
Beach
and
Data Loss
That the group’s technology products or
infrastructure are compromised to such an
extent that the group can no longer operate.
That a cyber actor gains control over the
group’s systems or accesses customer or RPM
confidential information and attempts to either
extort monies or wrongfully disclose that
confidential information or conduct an act of
individual identity theft.
For privacy, the risk of private/personal
information loss and/or a Privacy Act penalty or
enforcement action.
The group has an ISO27001:2022 accredited and
externally audited Information Security Management
System (ISMS) to mitigate and reduce the negative
impact of information security and technology risks.
The group installs and maintains up to date security
products and services for physical office security,
network protection and detection, hardware security
and software security as well as completes regular staff
awareness training.
The group conducts monitoring, vulnerability and
penetration testing and undertakes regular audits on all
relevant systems and ensures procedures are in place to
undertake peer reviews of software developed and
associated security scanning.
Exposure
to
Climate
Change, ESG
As a global business with active operations
supplying software and advisory services to the
mining industry across the world, the group’s
operations are subject to wider economic,
environmental (including climate change),
governmental
and
social
sustainability
requirements that have the potential to impact
on RPM’s long term financial and operational
sustainability.
Exposure to Coal, Climate Change and ESG requirements
remains a key strategic risk currently being actively
addressed by the RPM Board.
RPM has increased its ESG credentials via acquisitions
and organic expansion of its ESG division and software
solutions.
RPM is progressing its own understanding of its
exposure to climate change and ESG risks through the
work being undertaken by the Board ESG &
Sustainability sub-committee first established during
FY2023.
Advisory
Report Errors
The consulting services work completed by
RPM’s Advisory business is often relied upon by
RPM’s clients in transactions of high value
and/or in circumstances where if a loss arises
the group could suffer a loss in business
reputation and/or financial loss.
RPM deploys a capability management system which
includes project management and public reporting
review and oversight which continue to be the backbone
of the group’s advisory quality assurance process.
The group ensures it retains in-house specialists that can
project manage and peer review the work completed in-
house and by our sub consultant network to ensure
RPM’s work is delivered to the required professional
standards.
Markets and
Growth
The risk of missing strategic opportunities to
grow either organically or inorganically,
through deployment of resources or capital.
Management takes an active role in M&A including
broad
competitor,
partner
and
market
based
assessments which have successfully enabled the group
to expand its offerings both in the software and advisory
businesses.
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DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |9
6.
Key risks and risk management (Continued)
Risk
Nature of Risk
Controls established
Legal
&
Regulatory
Issues
The group's operations are subject to
a variety of industry, country, legal
and regulatory conditions. Risk of
non-compliance with legal obligations
under applicable laws or contract, or
the
lack
of
enforceability
of
contractually agreed terms, as well as
any other litigation, in each case with
a revenue or contingent liability
impact and/or material impact on the
group.
The group has strong legal, compliance and risk management
reviews, frameworks and procedures managed and overseen by
the groups internal legal department to ensure conformity by the
group with relevant legal and regulatory requirements.
The group upholds high business conduct standards. Both new
hires and existing employees are obligated to participate in
compliance and legal on-boarding and training initiatives.
RPM’s legal and compliance team conducts international sanction
reviews on any new customer, supplier or counterparty in
jurisdictions where sanctions issues may arise.
People
Ensuring a safe working environment
for all staff, those in RPM’s offices
around the world and those that
travel and attend remote client mine
sites is critical to ensure no harm
comes to the group’s personnel.
A shortage in labour, inability to
attract the right qualified personnel or
an increase in remuneration costs
could be detrimental to the group’s
ability to successfully deliver against
its strategic objectives.
The group proactively encourages a safe working environment,
including for remote work through the use of international
accredited safe travel systems and process, and supports and
encourages diversity and inclusion and challenges the status quo
while developing employee competency and growth. The group
has in place a multi-pronged strategy to ensure the group’s
culture is engaging, challenging and a place where employees
derive personal satisfaction from their work and where the group
is viewed as an employer of choice.
The group is focused on diverse methods of talent attraction and
retention using a varied set of retention methods including
professional development, challenging work, opportunities for
career progression, market competitive remuneration linked to
the company’s strategic focus, and investment in continuing
learning and development opportunities.
IP
infringement
The risk of competitors, customers or
a
third
party
copying
RPM’s
Intellectual Property including in
countries around the world with less
protective intellectual property rules.
RPM ensures it does not provide access to source code, and only
enters into contracts in jurisdictions and on terms and conditions
where potential legal disputes can be fairly heard and where
RPM’s rights and interests can be adequately protected.
Large Project
Delivery
Delivering large ‘business critical’
software
implementations
and
complex advisory projects to the
satisfaction of customers with the
required level of quality.
The group focuses on quality and customer success in all stages
of its engagement through project delivery. RPM deploys
standardised
product
management,
ISO9001
certified
development processes and project management oversight to
ensure RPM’s work is delivered on time and to the required
professional standards.
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DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |10
7.
Information on Current Directors and Company Secretary
Directors
Experience
Special
responsibilities
Stephen
Baldwin
Non-executive Director and Company Chairman (from 1 March 2021).
Stephen joined the Board effective 1 July 2020 and was appointed Chairman
of the Board in March 2021.
Stephen is a professional company director and currently sits on the Board of
two other companies (Taumata and Tiaki). Other recent Board roles have
included ASX-listed Wameja Limited (sold to Mastercard in September 2021)
and Axicom (sold to Australian Tower Network in May 2022).
Stephen started his career as a chartered accountant with Price Waterhouse
(now PwC), working in three countries over a decade. He then went into funds
management, initially with Hambro-Grantham and subsequently with Colonial
First State, where he rose to become that group’s Head of Private Equity. For
the past decade, Stephen has represented one of Australia’s larger
superannuation funds (UniSuper) as a director on the Boards of their private
market investments.
Stephen has a wealth of experience dealing with international business in the
technology industry.
Qualifications: Bachelor of Commerce (Honours), ACA.
Other listed company directorships in last three years: Wameja Limited.
Company Chair
(from 1 March
2021)
Independent
Director
Non-executive
Director
Member of Audit &
Risk Committee
Richard
Mathews
Appointed Managing Director 28 August 2012.
Richard’s previous roles includes Senior Vice President, International at J D
Edwards, CEO of Mincom Ltd, Chief Executive Officer and then Non-Executive
Chairman of eServGlobal Limited.
Richard is a director on the Telstra Health Pty Ltd Board.
Qualifications: Bachelor of Commerce, Bachelor of Science, ACA
Other listed company directorships in last three years: None.
Managing Director,
Chief Executive
Officer (CEO)
Member of ESG &
Sustainability
Committee
Angeleen
Jenkins
Non–executive Director. Joined the Board on 1 July 2021.
Angeleen worked extensively in high risk commercial engineering, building &
construction contracting throughout her executive career, including almost 25
years in the multi-national construction sector as a Director and Executive of a
major construction group that delivered infrastructure projects to heavy
industry clients (mining & metals and oil & gas sectors) throughout Australia,
Asia, NZ/Pacific, and the Middle East.
Angeleen has held company directorships since 2007 in building, engineering,
manufacturing, construction, forestry, technology and utilities sectors for
private, public and government entities. Angeleen is presently employed as
the Chairperson / Director of Central Highlands Water, Director of Tiaki
Plantations Company and Taumata Plantations Limited, and a former
Executive Director of McConnell Dowell (a major multi-national construction
group).
Qualifications: Bachelor of Arts in Psychology and Fellow of the Australian
Institute of Company Directors and the Governance Institute of Australia.
Other listed company directorships in last three years: None.
Independent
Director
Non-executive
Director
Chair of ESG &
Sustainability
Committee
Member of HR &
Remuneration
Committee
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |11
7.
Information on Current Directors and Company Secretary (Continued)
Directors
Experience
Special
responsibilities
Paul
Scurrah
Non-executive Director. Paul joined the Board effective 1 January 2021.
Paul has been involved in the transportation, logistics, travel and aviation
industries for over 25 years at both executive and non-executive levels.
Paul is currently the Managing Director & CEO of Pacific National and is
the former Non-Executive Director and Chairman at Whizz Technologies.
Qualifications: Finance for Senior Executives Harvard Business School
Other listed company directorships in last three years: None (in the last
three years).
Independent Director
Non-executive
Director
Chair of HR &
Remuneration
Committee
Ross
Walker
Non–executive Director. Joined the Board in March 2007.
Joined Pitcher Partners Brisbane in 1985, Managing Partner from 1992 to
2008 and again from 2014 to 2017. Predominantly involved in corporate
finance, auditing, valuations, capital raisings and mergers and acquisitions
for the past 20 years.
Qualifications: Bachelor of Commerce, FCA
Other listed company directorships in last three years: Wagners Holding
Company Limited (ASX : WGN) since its IPO in December 2017 and
Sovereign Cloud Holdings Limited (ASX : SOV) since December 2017
Independent Director
Non-executive
Director
Chair of Audit & Risk
Committee
Company Secretary
James O’Neill, Group General Counsel and Company Secretary joined RPMGlobal Holdings Limited in December
2012. Qualifications: Bachelor of Laws and Bachelor of Information Technology from the Queensland University of
Technology, Graduate Diploma in Applied Corporate Governance from the Governance Institute of Australia,
Solicitor and Member of the Queensland Law Society and Associate Member of the Governance Institute of
Australia (AGIA) and Chartered Institute of Secretaries (ACIS).
8.
Meetings of Directors
The number of meetings of the Company’s Board of Directors and of each Board Committee held during the year
ended 30 June 2024 and the number of meetings attended by each Director were as follows:
Full meetings
of Board of Directors
Audit & Risk
Committee
HR & Remuneration
Committee
ESG & Sustainability
Committee
Attended
Held
Attended
Held
Attended
Held
Attended
Held
Stephen
Baldwin
7
7
3
3
3 (by invite)
3
2 (by invite)
2
Richard
Mathews
7
7
3 (by invite)
3
3 (by invite)
3
2
2
Angeleen
Jenkins
7
7
3 (by invite)
3
3
3
2
2
Paul Scurrah
7
7
3 (by invite)
3
3
3
1 (by invite)
2
Ross Walker
7
7
3
3
3 (by invite)
3
-
2
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |12
9.
Directors’ Interests
The relevant interest of each Director in the shares and options issued by the Company, as notified by the Directors
to the ASX in accordance with section 205G(1) of the Corporations Act 2001, at the date of this report is as follows:
RPMGlobal Holdings Limited
Ordinary
shares
Options over
ordinary shares
S Baldwin
3,272,987
-
R Mathews
8,220,138
-
A Jenkins
40,000
-
P Scurrah
26,741
-
R Walker
1,200,000
-
10.
Shares Under Option
Unissued ordinary shares of RPMGlobal Holdings Limited under option at the date of this report are as follows:
Date granted
Expiry date
Exercise price
Number of options
14/09/2020
14/09/2025
$1.15
50,000
11/11/20201
11/11/2025
$0.00
300,454
23/03/20211
23/03/2026
$0.00
493,121
03/09/20211
03/09/2026
$0.00
933,723
25/02/2022
25/02/2027
$0.00
6,44989
26/09/20221
26/09/2027
$0.00
1,339,499
01/09/20231
01/09/2028
$0.00
1,496,754
5,288,540
1 Included in these options were options granted as remuneration to the five highest remunerated officers during the year. Details of options granted to these remunerated officers who
are also key management personnel are disclosed in section 21E of the Remuneration Report. There are no Officers in the Company who are not also identified as key management
personnel. The Company’s CEO has not received any options in current or prior periods.
No option holder has any right under the options to participate in any other share issue of the Company or any
other entity.
11.
Shares issued on the exercise of options
During the financial year or since the end of the year up to the date of this report the following shares were issued
following exercise of previously issued share options:
Option Grant Date
Number of shares issued
Exercise price paid, $
13/09/2018
666,671
$406,669
14/12/2018
330,670
$191,789
15/03/2019
100,001
$58,000
14/09/2020
33,334
$38,334
12/11/2020
791,257
$0.00
23/03/2021
661,549
$0.00
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |13
12.
Indemnity and Insurance of Officers
The Company has indemnified the Directors and Officers of the Company for costs incurred, in their capacity as a
Director or Officer, for which they may be personally liable, except where there is a lack of good faith.
During the financial year, the Company paid insurance premiums to insure the Directors and Officers of the
Company against certain risks associated with their activities as Officers of the Company. The terms of that policy
prohibit disclosure of the nature of liability covered, the limit of such liability and the premium paid.
13.
Environmental Legislation
RPMGlobal Holdings Limited and its controlled entities are not subject to any particular and significant
environmental regulation under a law of the Commonwealth or of a State or Territory.
14.
Non-audit Services
Details of the amounts paid or payable to the auditor (BDO Audit Pty Ltd) for audit and non-audit services during
the year are disclosed in note 16.
The board of directors, in accordance with advice provided by the Audit and Risk committee, is satisfied that the
provision of the non-audit services is compatible with the general standard of independence for auditors imposed
by the Corporations Act 2001. The directors are satisfied that the provision of non-audit services by the auditor did
not compromise the auditor independence requirements of the Corporations Act 2001 for the following reasons:
•
all non-audit services have been reviewed by the audit committee to ensure they do not impact the
impartiality and objectivity of the auditor, and
•
none of the services undermine the general principles relating to auditor independence as set out in APES
110 Code of Ethics for Professional Accountants.
15.
Indemnity of Auditors
The Company has agreed to indemnify and hold harmless its auditors, BDO Audit Pty Ltd, against any and all losses,
claims, costs, expenses, actions, demands, damages, liabilities or any other proceedings whatsoever incurred by
the auditors in respect of any claim by a third party arising from or connected to any breach by the Company.
16.
Auditor’s Independence Declaration
In accordance with Section 307C of the Corporations Act 2001, a copy of the auditor’s independence declaration is
enclosed on page 22.
17.
Legal Proceedings on Behalf of the Group
No person has applied for leave of the Court to bring proceedings on behalf of the Group or intervene in any
proceedings to which the Group is a party for the purpose of taking responsibility on behalf of the Group for all or
any part of those proceedings.
18.
Significant Changes in the State of Affairs
There was no matter or circumstance during the financial year that has significantly affected the state of affairs of
the Group not otherwise disclosed.
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |14
19.
Matters Subsequent to the End of the Financial Year
No matters or circumstances have arisen since 30 June 2024 that have significantly affected the Group’s
operations, results or state of affairs, or may do so in future years.
20.
Rounding of Amounts
The Company is a type of company referred to in ASIC Corporations (Rounding in Financial/Directors' Reports)
Instrument 2016/191 and therefore the amounts contained in this report and in the financial report have been
rounded to the nearest $1,000, or in certain cases, the nearest dollar.
21.
Remuneration Report - Audited
The remuneration report is set out under the following main headings:
A.
Principles used to determine the nature and amount of remuneration;
B.
Service agreements;
C.
Details of remuneration;
D.
Bonus and share-based compensation benefits;
E.
Equity instruments held by key management personnel; and
F.
Other transactions with key management personnel.
21A.
Principles Used to Determine the Nature and Amount of Remuneration
Remuneration and compensation have the same meaning in this report.
This report discusses the Group’s policies in regard to compensation of key management personnel (KMP). The
identified KMP have authority and responsibility for planning, directing and controlling the activities of the Group.
In addition to the Directors, the Company assessed the Chief Financial Officer and Group General Counsel &
Company Secretary as having authority and responsibility for planning, directing and controlling all activities of the
Group, directly or indirectly.
The Board has established a HR and Remuneration Committee to assist with fair and responsible remuneration and
incentive policies enabling the Group to attract and retain KMP and Directors who will create value for shareholders
and support the Group’s mission. The HR and Remuneration Committee obtains independent advice if required on
the appropriateness of compensation packages given trends in comparative companies. In the 2024 financial year
the Committee did not use a remuneration consultant. The Group’s Corporate Governance Statement provides
further information on the role of this Committee. The compensation structures explained below are designed to
attract suitably qualified candidates, reward the achievement of strategic, operational objectives and achieve the
broader outcome of creation of value for shareholders.
Executive Director and other Key Management Personnel
The compensation structures take into account:
•
The capability and experience of the KMP;
•
Their ability to control the relevant segment’s performance;
•
The segment or Group earnings; and
•
The connection of remuneration policies to deliver an increase in the company’s share price and therefore
financial return to shareholders.
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |15
21.
Remuneration Report - Audited (Continued)
21A. Principles Used to Determine the Nature and Amount of Remuneration (Continued)
Compensation packages include a mix of fixed, short-term and long-term performance-based incentives. In
addition to their salaries, the Group also provides non-cash benefits to its KMP and contributes to a defined
contribution superannuation plan (or equivalent pension plan) on their behalf.
Fixed Compensation
Fixed compensation is calculated on a total cost basis and includes salary, allowances, non-cash benefits, employer
contributions to superannuation funds and any fringe benefits tax charges related to employee benefits, including
motor vehicles parking provided.
Compensation levels are reviewed using an individual approach, based on evaluation of the individual, and a
comparison to the market. A KMP’s compensation is also reviewed on promotion.
Performance Linked Compensation
Performance linked compensation includes both short-term and long-term incentives and is designed to reward
each KMP for meeting and exceeding their Key Performance Objectives (KPOs). The Short-Term Incentive (STI) is
an ‘at risk’ incentive provided in the form of cash, while the Long-Term Incentive (LTI) is provided as options over
ordinary shares of the Company under the rules of the Employee Share Option Plan (ESOP) (see note 22 to the
financial statements). The current long-term performance incentive structure was first implemented in the 2013
year and was most recently approved by shareholders at the 27 October 2022 Annual General Meeting.
The table below sets out the performance-based compensation paid to KMP together with earnings for the same
period. Performance based compensation consists of STI cash bonus and LTI share-based payments.
Performance based compensation
Year ended
30 June
STI
$’000
LTI
$’000
Total
$’000
TCV1
$m
NPAT
$m
Share price
$
2019
217
119
336
22.4
(5.9)
0.59
2020
867
68
935
41.4
(0.7)
1.05
2021
867
55
922
52.9
(5.5)
1.78
2022
1,022
108
1,130
55.9
(4.1)
1.65
2023
1,022
137
1,159
68.7
3.7
1.48
2024
1,168
128
1,296
76.7
8.7
2.87
1 Software Subscription component of Total Contract Value of software sold during the financial year (non-IFRS disclosure)
Short-term Incentive
Effective 1 July 2012, the Group implemented a variable pay structure, referred to as the Executive Incentive Plan
(EIP). Each of the identified KMP has a portion of their remuneration linked to the EIP. The key objective of the EIP
is to create clear alignment between individual and business performance and remuneration by providing a
performance-based reward to participants in line with their relative contribution to the Group. The EIP achieves
the alignment by focusing participants on achieving goals which contribute to sustainable shareholder value and
providing a clear link between performance and the Group financial result.
During the 2018 financial year the business began transitioning from selling once-off perpetual software licenses
to offering subscription licenses. In 2020 as a reflection of the strategic importance of growing subscription
revenue, the Board introduced a software sales Total Contracted Value (TCV) target as a part of the EIP.
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |16
21.
Remuneration Report - Audited (Continued)
21A. Principles Used to Determine the Nature and Amount of Remuneration (Continued)
The Group’s TCV sales and earnings growth in 2024 resulted in a corresponding increase in the company’s share
price over the same period. The Board believes the company’s intrinsic value has increased each year as a result of
the growth in TCV and underlying earnings.
The 15% increase in total revenue and 15% increase in software subscription TCV growth year-on-year resulted in
the EIP targets being achieved and therefore 100% of the EIP was awarded for the financial year.
Cash bonuses are paid, provided for or forfeited in the year to which they relate.
The Board assessed performance of the KMP for the 2024 Financial Year as shown in the table below:
Fixed Compensation
Variable
Compensation
STI awarded
STI forfeited
R Mathews
50%
50%
100%
-
M Kochanowski
76%
24%
100%
-
J O’Neill
76%
24%
100%
-
Long-term Incentive
Options were issued in the 2021, 2022, 2023 and 2024 financial years under the Company’s Employee Share Option
Plan (ESOP) to KMP’s at the discretion of the Board. Consistent with the current ESOP terms last approved by
shareholders at the Company’s 2019 Annual General Meeting, the rules of the ESOP enable the Board to determine
the applicable vesting criteria and to set a timetable for vesting of options in the Offer Document, including vesting
in tranches over a defined period.
The Board has the discretion on whether or not to set performance hurdles for vesting or to link vesting solely to a
defined service period in order to drive key staff retention and reward longevity of service.
The options issued from November 2020 have a zero exercise price and vest in one single tranche three years from
the grant date, with vesting conditions linked to the holder maintaining employment with the Group over that
period and Total Shareholder Return on the company’s shares overperforming the ASX 300 accumulated index
(AXKOA).
The Board has a Margin Loan policy that restricts Directors and Executives of the Group from entering into financial
contracts secured by shares and other securities of the Company. This policy requires the approval of the Chairman
of the Board for any financial arrangements or facilities related to Company shares held by the Directors and
Executives.
21B. Service Agreements
Non-executive Directors and Key Management personnel
Fees and payments to Non-executive Directors reflect the demands which are made on, and the responsibilities of,
the Directors. Non-executive Directors’ fees and payments are reviewed periodically by the Board and are
determined within an aggregate Directors’ fee pool limit, which is periodically recommended for approval by
shareholders. The pool currently stands at $500,000, unchanged since it was approved in the 2009 Annual General
Meeting.
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |17
21.
Remuneration Report - Audited (Continued)
21B. Service Agreements (Continued)
Non-executive Directors’ base remuneration was last reviewed with effect from 1 July 2023 (with effect for the
2024 Financial Year). Both the Chairman’s and Non-executive Directors’ remuneration is inclusive of committee
fees. Details of contracts with the current Directors and KMP of the Group that received remuneration during the
2024 financial year are set out below.
Terms of agreement
Base salary including
superannuation
(where applicable)
Termination benefit 1
Notice Period
S Baldwin
Unlimited in term
$140,000
Nil
Nil
A Jenkins
Unlimited in term
$100,000
Nil
Nil
P Scurrah
Unlimited in term
$100,000
Nil
Nil
R Walker
Unlimited in term
$100,000
Nil
Nil
R Mathews
Unlimited in term
$892,320
6 months
6 months
M Kochanowski
Unlimited in term
$419,025
3 months
3 months
J O’Neill
Unlimited in term
$455,100
3 months
3 months
1 Termination benefit includes notice period at Base salary rate including superannuation plus statutory entitlements
The Board completed its annual review of executive remuneration including remuneration of the Chief Executive
Officer and Managing Director, Mr Richard Mathews on 23 August 2024 and Mr Mathews’ base remuneration has
been increased to $945,000 effective 1 July 2024. All other terms of Mr Mathews’ total remuneration package
remain materially the same as previously first advised on 28 August 2012 and amended on 25 September 2013.
21C. Details of Remuneration
The KMP’s are also entitled to receive upon termination of employment their statutory entitlements of accrued
annual and long service leave (where applicable), together with any superannuation benefits (where applicable).
Compensation levels are reviewed each year to meet the principles of the remuneration policy.
For the 2024 financial year, the Directors and Key Management Personnel were:
Directors
Executive Directors
Richard Mathews – CEO and Managing Director
Non-executive Directors
Stephen Baldwin – Chairman
Angeleen Jenkins – Non-executive Director
Paul Scurrah – Non-executive Director
Ross Walker –Non-executive Director
In addition to executive Directors mentioned above, the following persons were assessed by the Company as the
executives who had the greatest authority and responsibility for planning, directing and controlling all activities of
the Group, directly or indirectly, during the 2024 financial year:
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |18
21.
Remuneration Report - Audited (Continued)
21C.
Details of Remuneration (Continued)
Other Key Management Personnel
Name
Position
Michael Kochanowski
Chief Financial Officer
James O’Neill
Group General Counsel and Company Secretary
Details of the remuneration of each Director of RPMGlobal Holdings Limited and each of the other KMP’s of the
Group are set out in the following tables.
2024
Short-term benefits
Post -
employ
ment
benefits
Share-
based
payment
(options)
Total
Proportion
of remun-
eration
perform-
ance
related
Value of
options
as
propor-
tion of
remun-
eration
Cash salary
and fees
Movement
in leave
entitle-
ments
STI
cash bonus
Non –
monetary
benefits 1
$
$
$
$
$
$
$
%
%
Directors
S Baldwin
140,000
-
-
-
-
-
140,000
-
-
A Jenkins
90,090
-
-
-
9,910
-
100,000
-
-
P Scurrah
100,000
-
-
-
-
-
100,000
-
-
R Walker
100,000
-
-
-
-
-
100,000
-
-
R Mathews
871,726
(50,556)
892,320
9,638
20,594
-
1,743,722
51%
-
1,301,816
(50,556)
892,320
9,638
30,504
-
2,183,722
41%
-
Other Key Management Personnel
M Kochanowski
391,525
13,886
132,125
9,638
27,500
62,192
636,866
31%
10%
J O’Neill
427,600
6,823
143,500
9,638
27,500
65,669
680,730
31%
10%
819,125
20,709
275,625
19,276
55,000
127,861
1,317,596
31%
10%
Total
2,120,941
(29,847)
1,167,945
28,915
85,504
127,861
3,501,318
37%
4%
2023
Short-term benefits
Post -
employ
ment
benefits
Share-
based
payment
(options)
Total
Proportion
of remun-
eration
perform-
ance
related
Value of
options
as
propor-
tion of
remun-
eration
Cash salary
and fees
Movement
in leave
entitle-
ments
STI
cash bonus
Non –
monetary
benefits 1
$
$
$
$
$
$
$
%
%
Directors
S Baldwin
100,000
-
-
-
-
-
100,000
-
-
A Jenkins
72,364
7,636
80,000
-
P Scurrah
80,000
-
-
-
-
-
80,000
-
-
R Walker
80,000
-
-
-
-
-
80,000
-
-
R Mathews
755,570
6,832
780,000
9,455
24,430
-
1,576,287
49%
-
1,087,934
6,832
780,000
9,455
32,066
-
1,916,287
41%
-
Other Key Management Personnel
M Kochanowski
342,675
11,493
117,250
9,455
27,500
67,834
576,207
32%
12%
J O’Neill
363,942
(8,187)
124,250
9,455
28,333
69,625
587,418
33%
12%
706,617
3,306
241,500
18,910
55,833
137,459
1,163,625
33%
12%
Total
1,794,551
10,138
1,021,500
28,365
87,899
137,459
3,079,912
38%
4%
1 Includes car park.
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |19
21.
Remuneration Report - Audited (Continued)
21D. Bonuses and Share-based Compensation Benefits
All options refer to options over ordinary shares of RPMGlobal Holdings Limited, which are exercised on a one-for-
one basis under the ESOP Plan.
The assessed fair value at grant date of options granted to the individuals is allocated equally over the period from
grant date to vesting date, based on an estimate of the number of options likely to vest, and the amount is included
in the remuneration tables above. Fair values at grant date are determined using a Trinominal Lattice model that
takes into account the exercise price, the term of the option, the share price at grant date and expected price
volatility of the underlying share, the expected dividend yield and the risk-free interest rate for the term of the
option. For zero exercise price options, the Monte Carlo simulation run by the model takes into account multiple
scenarios for the exercising of the options. Details of options over ordinary shares in the Company provided as
remuneration to each Director and each of the KMP and the Group are set out below. When exercisable, each
option is convertible into one ordinary share of RPMGlobal Holdings Limited.
Options granted under the ESOP plan carry no dividend or voting rights until the options vest, are exercised and
converted to ordinary shares whereupon those ordinary shares carry dividend and voting rights consistent with all
other ordinary shares of the Company.
The assessed fair value at grant date of options granted to the individuals is allocated equally over the period from
grant date to vesting date, and the amount is included in the remuneration tables above.
Number of options granted
during the year
Number of options vested
during the year
S Baldwin
-
-
A Jenkins
-
-
P Scurrah
-
-
R Walker
-
-
R Mathews
-
-
M Kochanowski
71,620
164,235
J O’Neill
77,786
164,235
Details of options over ordinary shares in the Company provided as remuneration to key management personnel
are shown in the table below. The vesting conditions are set out in Section 21A. The table also shows the
percentages of the options granted that vested during the year. No options were forfeited during the year for the
KMPs.
The terms and conditions of each grant of options affecting remuneration of a KMP in the current or a future
reporting period are as follows:
Grant date
Vesting and exercise
date
Expiry date
Exercise
Price, $
Value per
option at grant date
12/11/2020
12/11/2023
12/11/2025
-
$0.70
23/03/2021
23/03/2024
23/03/2026
-
$0.80
3/09/2021
03/09/2024
03/09/2026
-
$1.19
26/09/2022
26/09/2025
26/09/2027
-
$0.93
1/09/2023
01/09/2026
1/09/2028
-
$0.95
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |20
21.
Remuneration Report - Audited (Continued)
21D.
Bonuses and Share-based Compensation Benefits (Continued)
Year
(FY) of
grant
Years in
which
option may
vest
Number of
options
granted
Value of
option at
grant date 1
Number
of
options
vested
during
the year
Vested
%
Number
of
options
forfeited
during
the year
Value at
date of
forfeiture 2
Forfeited
%
S Baldwin
-
-
-
-
-
-
-
-
-
A Jenkins
-
-
-
-
-
-
-
-
-
P Scurrah
-
-
-
-
-
-
-
-
-
R Walker
-
-
-
-
-
-
-
-
-
R Mathews
-
-
-
-
-
-
-
-
-
M Kochanowski
2021
2022
2023
2024
2024
2025
2026
2027
164,235
52,635
64,936
71,620
$0.70 - $0.80
$1.19
$0.93
$0.95
164,235
-
-
-
100%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
J O’Neill
2021
2022
2023
2024
2024
2025
2026
2027
164,235
55,778
68,813
77,786
$0.70 - $0.80
$1.19
$0.93
$0.95
164,235
-
-
-
100%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1 The value at grant date calculated in accordance with AASB 2 Share-based Payment of options granted during the year as part of
remuneration
2 The value of the options that were granted as part of remuneration and that were forfeited (lapsed) during the year because a vesting
condition was not satisfied was determined at the time of lapsing, but assuming the condition was satisfied.
21E.
Equity Instruments held by Key Management Personnel
No shares were granted as compensation in 2024 (2023: nil). The number of shares and options over shares in
the Company held during the financial year by each Director of RPMGlobal Holdings Limited and each of the
other key management personnel of the Group, including their personally-related entities, is set out below:
(i)
Options
Name
Balance at
start of year
Granted as
compensation
Exercised
Balance at the
end of the year
Vested and
exercisable
Average Value at
exercise date
S Baldwin
-
-
-
-
-
-
A Jenkins
-
-
-
-
-
-
P Scurrah
-
-
-
-
-
-
R Walker
-
-
-
-
-
-
R Mathews
-
-
-
-
-
-
M Kochanowski
281,806
71,620
(164,235)
189,191
-
1.93
J O’Neill
288,826
77,786
(164,235)
202,377
-
1.93
(ii)
Ordinary Shares
Balance at start of
year
Exercise of
Options
Sold During
the year
Acquired during the
year (on market)
Balance at the end of
the year
Directors
S Baldwin
3,272,987
-
-
-
3,272,987
A Jenkins
25,000
-
-
15,000
40,000
P Scurrah
26,741
-
-
-
26,741
R Walker
1,200,000
-
-
-
1,200,000
R Mathews
8,220,138
-
-
-
8,220,138
For personal use only
DIRECTORS’ REPORT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |21
21.
Remuneration Report - Audited (Continued)
21E.
Equity Instruments held by Key Management Personnel
(ii) Ordinary Shares (Continued)
Balance at start of
year
Exercise of
Options
Sold During
the year
Acquired during the
year (on market)
Balance at the end of
the year
Other key management personnel of the Group
M Kochanowski
186,668
164,235
-
-
350,903
J O’Neill
40,000
164,235
-
10,000
214,235
21F. Loans and Other Transactions with Key Management Personnel and their related parties
There were no transactions or loans with Key Management Personnel and their related parties during the 2024
financial year.
21G. 2023 Annual General Meeting (AGM)
At the Company’s 2023 Annual General Meeting (AGM), resolution 1, adoption of the Company’s Remuneration
Report for FY2023, which passed with a 73.72% For Vote, had more than 25% of votes cast against it (26.28%),
which constitutes a ‘first strike’ for the purposes of the Corporations Act 2001 (Cth). Total votes cast in respect of
the remuneration resolution represented 40% of the total Company shares on issue. It is worth noting, several
large shareholders voted ‘For’ the resolution however missed the proxy cut-off date and therefore their shares
were not counted. If they had been, the Company would not have recorded a ‘first strike’. The Board notes that
on average over the past five years, it has received a ‘For’ vote on the Remuneration resolution of greater than
96%. Notwithstanding the above, the Board takes this ‘first strike’ seriously. The Company did not receive any
specific feedback at the AGM or throughout the year on its remuneration practices.
Remuneration report – End
This report is made in accordance with a resolution of the Directors.
Stephen Baldwin
Chairman
Dated: 26 August 2024
For personal use only
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd
ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a
UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme
approved under Professional Standards Legislation.
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |22
Level 10, 12 Creek Street
Brisbane QLD 4000
GPO Box 457 Brisbane QLD 4001
Australia
Tel: +61 7 3237 5999
Fax: +61 7 3221 9227
www.bdo.com.au
DECLARATION OF INDEPENDENCE BY C K HENRY TO THE DIRECTORS OF RPMGLOBAL HOLDINGS
LIMITED
As lead auditor of RPMGlobal Holdings Limited for the year ended 30 June 2024, I declare that, to the
best of my knowledge and belief, there have been:
1.
No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2.
No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of RPMGlobal Holdings Limited and the entities it controlled
during the period.
C K Henry
Director
BDO Audit Pty Ltd
Brisbane, 26 August 2024
For personal use only
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |23
FOR THE YEAR ENDED 30 JUNE 2024
Notes
2024
$’000
2023
$’000
Revenue from contracts with customers
Services
50,329
41,423
Licence sales
1,302
2,916
Software maintenance
12,404
13,719
Software subscription
45,550
39,314
Total revenue from contracts with customers
109,585
97,372
Other income
2
3,730
988
Rechargeable expenses
(9,121)
(6,801)
Net Revenue
104,194
91,559
Expenses
Amortisation
10
(938)
(1,440)
Depreciation
9
(3,959)
(4,136)
Employee benefits expense
(67,526)
(60,778)
Commissions, short-term and long-term incentives
(9,150)
(7,392)
Impairment of receivables
(159)
(168)
Other employee costs
(1,106)
(1,158)
Office expenses
(3,361)
(2,928)
Professional services
(2,205)
(1,729)
Redundancy costs
(479)
(1,248)
Rent
(618)
(623)
Travel expenses
(2,350)
(2,641)
Other expenses
(2,400)
(2,312)
Total Expenses
(94,251)
(86,553)
Profit/(Loss) before finance costs and income tax
9,943
5,006
Finance income/(costs)
Finance income
682
266
Finance costs
(391)
(411)
Fair value adjustments
20(d)
(70)
(26)
Net finance costs
221
(171)
Profit before income tax
10,164
4,835
Income tax expense
3
(1,508)
(1,146)
Profit after income tax from continuing operations
8,656
3,689
The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
For personal use only
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |24
FOR THE YEAR ENDED 30 JUNE 2024
2024
$’000
2023
$’000
Profit
8,656
3,689
Other comprehensive income
Items that will not be reclassified subsequently to profit or loss:
Re-measurements of defined benefit obligations
(21)
(64)
Items that may be reclassified subsequently to profit or loss:
Foreign currency translation differences
(166)
(160)
Other comprehensive income / (loss), net of tax
(187)
(224)
Total comprehensive income
8,469
3,465
Earnings per share for profit attributable to the ordinary equity
holders of the company:
Basic earnings per share
21
3.8
1.6
Diluted earnings per share
21
3.8
1.6
The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
For personal use only
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |25
AS AT 30 JUNE 2024
Notes
2024
$’000
2023
$’000
ASSETS
Current assets
Cash and cash equivalents
5
34,209
34,757
Trade and other receivables
6
22,207
22,831
Contract assets
7
6,974
3,869
Current tax receivable
25
1,533
Other assets
8
6,789
5,276
Total current assets
70,204
68,266
Non-current assets
Trade and other receivables
6
215
236
Property, plant and equipment
9
8,307
10,159
Deferred tax assets
4
3,444
3,258
Intangible assets
10
28,112
28,786
Other assets
8
3,201
4,398
Total non-current assets
43,279
46,837
Total assets
113,483
115,103
LIABILITIES
Current liabilities
Trade and other payables
11
12,633
12,931
Provisions
12
7,294
6,343
Current tax liabilities
519
611
Other Liabilities
13
31,683
29,613
Total current liabilities
52,129
49,498
Non-current liabilities
Provisions
12
1,032
1,107
Other Liabilities
13
4,476
6,558
Total non-current liabilities
5,508
7,665
Total liabilities
57,637
57,163
Net assets
55,847
57,940
EQUITY
Contributed equity
14
82,967
93,877
Reserves
15
(696)
(3,984)
Accumulated losses
(26,424)
(31,953)
Total equity
55,847
57,940
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
For personal use only
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |26
FOR THE YEAR ENDED 30 JUNE 2024
Notes
Contributed
equity
Reserves
Accumulated
losses
Total equity
$'000
$'000
$'000
$'000
Balance at 1 July 2023
93,877
(3,984)
(31,953)
57,940
Profit for the year
-
-
8,656
8,656
Other comprehensive income/(expense)
-
(166)
(21)
(187)
Total comprehensive income
-
(166)
8,635
8,469
Transactions with owners in their capacity as owners
Contributions of equity, net of transaction costs
14
665
-
-
665
Share buyback, net of tax
14
(12,832)
-
-
(12,832)
Employee share options expensed
15
-
1,605
-
1,605
Employee share options transferred
15
1257
(1,287)
30
-
Historical reserves transferred to losses
-
3,136
(3,136)
-
(10,910)
3,454
(3,106)
(10,562)
Balance at 30 June 2024
82,967
(696)
(26,424)
55,847
Balance at 1 July 2022
100,427
(4,712)
(35,601)
60,114
Profit for the year
-
-
3,689
3,689
Other comprehensive income/(expense)
-
(160)
(64)
(224)
Total comprehensive income
-
(160)
3,625
3,465
Transactions with owners in their capacity as owners
Contributions of equity, net of transaction costs
14
762
-
-
762
Share buyback, net of tax
14
(7,551)
-
-
(7,551)
Employee share options expensed
15
-
1,150
-
1,150
Employee share options transferred
15
239
(262)
23
-
(6,550)
888
23
(5,639)
Balance at 30 June 2023
93,877
(3,984)
(31,953)
57,940
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
For personal use only
CONSOLIDATED STATEMENT OF CASHFLOWS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |27
FOR THE YEAR ENDED 30 JUNE 2024
Notes
2024
$'000
2023
$'000
Cash flows from operating activities
Receipts from customers
118,805
107,471
Payments to suppliers and employees
(102,308)
(94,633)
Continued operations
16,497
12,838
Interest received
682
266
Finance costs
(392)
(411)
Income taxes paid
(280)
(466)
Net cash inflow from operating activities
19
16,507
12,227
Cash flows from investing activities
Payments for property, plant and equipment
9
(1,058)
(1,217)
Payment for acquisition of subsidiary, net of cash acquired
-
(751)
Payments for contingent consideration
20(d)
(90)
(165)
Payments for restricted cash
(492)
(414)
Proceeds from sublease
56
53
Payments for intangible assets
10
(289)
(189)
Net cash outflow from investing activities
(1,873)
(2,683)
Cash flows from financing activities
Contributions of equity
14
695
770
Share buy back
14
(12,709)
(7,476)
Transaction costs
14
(153)
(83)
Repayment of lease liabilities
(3,016)
(3,132)
Net cash outflow from financing activities
(15,183)
(9,921)
Net decrease in cash and cash equivalents held
(549)
(377)
Cash and cash equivalents at the beginning of the financial year
34,757
34,458
Effects of exchange rate changes on cash and cash equivalents
1
676
Cash and cash equivalents at the end of the financial year
5
34,209
34,757
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |28
1.
Summary of Material Accounting Policies
The material accounting policies adopted in the preparation of the financial report are set out below. These
policies have been consistently applied to all the years presented, unless otherwise stated.
RPMGlobal Holdings Limited is a listed public company, incorporated and domiciled in Australia.
The financial report comprises the consolidated entity (“Group”) consisting of RPMGlobal Holdings Limited and
its subsidiaries.
The financial report was authorised for issue on 26 August 2024.
(a)
Basis of Preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting
Standards and interpretations issued by the Australian Accounting Standards Board and the Corporations Act
2001 (Cth). RPMGlobal Holdings Limited is a for-profit entity for the purposes of preparing the financial
statements.
Compliance with IFRS
The consolidated financial statements of RPMGlobal Holdings Limited also comply with International Financial
Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
Historical cost convention
These financial statements have been prepared under the historical cost convention.
(b)
Principles of Consolidation
The consolidated financial statements incorporate the assets and liabilities of all entities controlled by RPMGlobal
Holdings Limited as at 30 June 2024 and the results of all controlled entities for the year then ended. RPMGlobal
Holdings Limited and its controlled entities together are referred to in this financial report as the “consolidated
entity” or the “Group”.
Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls
an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and
has the ability to affect those returns through its power to direct the activities of the entity.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-
consolidated from the date that control ceases.
The acquisition method of accounting is used to account for the acquisition of subsidiaries by the Group (refer to
note 1(j)).
Intercompany transactions, balances and unrealised gains on transactions between Group companies are
eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of
the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure
consistency with the policies adopted by the Group.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |29
1.
Summary of Material Accounting Policies (Continued)
(c)
Income Tax
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based
on the national income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities
attributable to temporary differences and to unused tax losses.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the
tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However,
the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a
transaction other than a business combination that at the time of the transaction affects neither accounting nor
taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or
substantially enacted by the reporting date and are expected to apply when the related deferred income tax asset
is realised, or the deferred income tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to utilise those temporary differences and losses in the tax
jurisdiction in which they arose.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and
tax bases of investments in controlled entities where the parent entity is able to control the timing of the reversal
of the temporary differences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and
tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a
net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in
other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive
income or directly in equity, respectively.
Tax consolidation legislation
RPMGlobal Holdings Limited and its wholly owned Australian controlled entities have implemented the tax
consolidation legislation.
The head entity, RPMGlobal Holdings Limited, and the controlled entities in the tax consolidated group account
for their own current and deferred tax amounts. These tax amounts are measured as if each entity in the tax
consolidated group continues to be a standalone taxpayer in its own right.
In addition to its own current and deferred tax amounts, RPMGlobal Holdings Limited also recognises the current
tax liabilities or assets and the deferred tax assets arising from the unused tax losses and unused tax credits
assumed from controlled entities in the tax consolidated group.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as
amounts receivable or payable to other entities in the Group. Details about the tax funding agreements are
disclosed in note 4.
Any difference between the amounts assumed and amounts receivable or payable under the tax funding
agreement are recognised as a contribution to (or distribution from) wholly-owned tax consolidated entities.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |30
1.
Summary of Material Accounting Policies (Continued)
(d)
Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operational decision maker. The chief operating decision maker, who is responsible for allocating resources and
assessing performance of the operating segments, has been identified as the CEO and Managing Director.
The assets and liabilities of the Group are regularly reviewed on a consolidated basis but are not regularly
reported to the chief operating decision maker at a segment level. As such this information has not been included
in the Operating Segment note 23.
(e)
Foreign Currency Translation
i)
Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency
of the primary economic environment in which the entity operates (‘the functional currency’). The
consolidated financial statements are presented in Australian dollars, which is RPMGlobal Holdings
Limited’s functional and presentation currency.
ii)
Transactions and balances
Foreign currency transactions are initially translated into the functional currency using the exchange
rates prevailing at the date of the transaction. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at year end exchange rates of monetary assets
and liabilities denominated in foreign currencies are recognised in profit or loss, except when they are
deferred in equity as qualifying cash flow hedges and qualifying net investment hedges or are attributable
to part of the net investment in a foreign operation.
Non-monetary items that are measured at fair value in a foreign currency are translated using the
exchange rates at the date when the fair value was determined. Translation differences on assets and
liabilities carried at fair value are reported as part of the fair value gain or loss. For example, translation
differences on non-monetary assets and liabilities such as equities held at fair value through profit or loss
are recognised in profit or loss as part of the fair value gain or loss and translation differences on non-
monetary assets such as equities whose changes in the fair value are presented in other comprehensive
income are recognised in other comprehensive income.
iii)
Group entities
The results and financial position of all the Group entities (none of which has the currency of a
hyperinflationary economy) that have a functional currency different from the presentation currency are
translated into the presentation currency as follows:
•
assets and liabilities on consolidation are translated at the closing rate at the reporting date;
•
income and expenses are translated at the exchange rates prevailing at the dates of the
transaction; and
•
all resulting exchange differences are recognised in other comprehensive income.
In disposal of a foreign operation, the component of other comprehensive income relating to that
particular foreign operation is recognised in profit or loss.
Fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of
the foreign entities and translated at the closing rate.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |31
1.
Summary of Material Accounting Policies (Continued)
(f)
Revenue Recognition
i)
Licence Sales
Revenue from the sale of perpetual licences is recognised at a point in time when the customer gains
access and thus control of the software and where the licences are considered distinct from other services
provided to the customer.
ii)
Software subscription
Revenue from the sale of term (subscription) licences are recognised over time on a straight-line basis
over the subscription term.
iii)
Consulting
Revenue from the provision of consulting services is recognised typically over time using the input
method as the Group’s performance does not create an asset with an alternative use to the Group and
the Group has an enforceable right to payment for its performance completed to date.
iv)
Software maintenance
Revenue for software maintenance is recognised over time on a straight line basis over the service period
as performance obligations require the Group to respond to requests made by customers to provide
technical product support and unspecified updates, upgrades and enhancements on a when-available
and if-available basis.
v)
Customer contract with multiple performance obligations
The Group frequently enters into multiple contracts with the same customer and where that occurs the
Group treats those arrangements as one contract if the contracts are entered into at or near the same
time and are commercially interrelated. The Group does not consider contracts closed more than three
months apart as a single contract.
The Group’s subscription contracts are combining an obligation to receive a licence, software support
services and other services obligations. The provision of services and sale of licences is treated as a single
performance obligation and recognised over time on a straight-line basis over the subscription term.
In all other cases, the total transaction price for a customer contract is allocated amongst the distinct
performance obligations based on their relative stand-alone selling prices. Where the stand-alone prices
are highly variable the Group applies a residual approach.
vi)
Incremental Costs of obtaining Customer Contracts
The Group recognises as an asset the incremental costs of obtaining a contract with a customer if the
Group expects to recover those costs. The incremental costs of obtaining a contract are those costs that
the Group incurs to obtain a contract with a customer that it would not have incurred if the contract had
not been obtained, such as commissions or third party software costs.
Costs to obtain a contract that would have been incurred regardless of whether the contract was obtained
are recognised as an expense when incurred, unless those costs are explicitly chargeable to the customer
regardless of whether the contract is obtained.
The Group recognises the incremental costs of obtaining a contract as an expense when incurred if the
amortisation period of the asset that the Group otherwise would have recognised is one year or less.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |32
1.
Summary of Material Accounting Policies (Continued)
(f)
Revenue Recognition (Continued)
vii)
Trade Receivables and Contract Assets
Trade receivables are amounts due from customers for goods sold or services performed in the ordinary
course of business. They are generally due for settlement within 30 days and therefore are all classified
as current. Trade receivables are recognised initially at the amount of consideration that is unconditional
unless they contain significant financing components, when they are recognised at fair value.
The Group holds the trade receivables with the objective to collect the contractual cash flows and
therefore measures them subsequently at amortised cost using the effective interest method.
A contract asset is the right to consideration in exchange for goods or services transferred to the
customer. If the Group performs by transferring goods or services to a customer before the customer
pays consideration or before payment is due, a contract asset is recognised for the earned consideration
that is conditional.
viii)
Contract liability
A contract liability is the obligation to transfer goods or services to a customer for which the Group has
received consideration (or an amount of consideration is due) from the customer. If a customer pays
consideration before the Group transfers goods or services to the customer, a contract liability is
recognised when the payment is made, or the payment is due (whichever is earlier). Contract liabilities
are recognised as revenue when the Group performs under the contract.
ix)
Financing components
The Group does not recognise adjustments to transition prices or Contract balances where the period
between the transfer of promised goods or services to the customer and payment by customer does not
exceed one year.
x)
Interest income
Revenue is recognised as interest accrues using the effective interest method. This is a method of
calculating the amortised cost of a financial asset and allocating the interest income over the relevant
period using the effective interest rate, which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to the net carrying amount of the financial asset.
(g)
Investments and Other Financial Assets
Classification
The Group classifies its financial assets in the following measurement categories:
•
those to be measured subsequently at fair value (either through Other Comprehensive Income (OCI), or
through profit or loss); and
•
those to be measured at amortised cost.
The classification depends on the Group’s business model for managing the financial assets and the contractual
terms of the cash flows.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |33
1.
Summary of Material Accounting Policies (Continued)
(g)
Investments and Other Financial Assets (Continued)
For assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI. For investments
in equity instruments that are not held for trading, this will depend on whether the Group has made an irrevocable
election at the time of initial recognition to account for the equity investment at fair value through other
comprehensive income (FVOCI).
The Group reclassifies debt investments when and only when its business model for managing those assets
changes.
Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not
at fair value through profit or loss (FVPL), transaction costs that are directly attributable to the acquisition of the
financial asset. Transaction costs of financial assets carried at FVPL are expensed in profit or loss.
Financial assets with embedded derivatives are considered in their entirety when determining whether their cash
flows are solely payment of principal and interest.
Debt instruments
Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset
and the cash flow characteristics of the asset. There are three measurement categories into which the Group
classifies its debt instruments:
•
Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows
represent solely payments of principal and interest are measured at amortised cost. Interest income from
these financial assets is included in finance income using the effective interest rate method. Any gain or
loss arising on derecognition is recognised directly in profit or loss and presented in other gains/(losses),
together with foreign exchange gains and losses. Impairment losses are presented as separate line item
in the statement of profit or loss.
•
FVOCI: Assets that are held for collection of contractual cash flows and for selling the financial assets,
where the assets’ cash flows represent solely payments of principal and interest, are measured at FVOCI.
Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains
or losses, interest revenue and foreign exchange gains and losses which are recognised in profit or loss.
When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is
reclassified from equity to profit or loss and recognised in other gains/(losses). Interest income from these
financial assets is included in finance income using the effective interest rate method. Foreign exchange
gains and losses are presented in other gains/(losses) and impairment expenses are presented as
separate line item in the statement of profit or loss.
•
FVPL: Assets that do not meet the criteria for amortised cost or FVOCI are measured at FVPL. A gain or
loss on a debt investment that is subsequently measured at FVPL is recognised in profit or loss and
presented net within other gains/(losses) in the period in which it arises.
Impairment
The Group assesses on a forward-looking basis the expected credit losses associated with its debt instruments
carried at amortised cost and FVOCI. The impairment methodology applied depends on whether there has been
a significant increase in credit risk.
For trade receivables, the Group applies the simplified approach permitted by AASB 9, which requires expected
lifetime losses to be recognised from initial recognition of the receivables.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |34
1. Summary of Material Accounting Policies (Continued)
(h)
Cash and Cash Equivalents
For statement of cashflows presentation purposes, cash and cash equivalents include cash on hand, deposits held
at call with financial institutions, other short-term, highly liquid investments with original maturities of three
months or less that are readily converted to known amounts of cash and which are subject to an insignificant risk
of changes in value and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the
consolidated statement of financial position.
(i)
Leases
Leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset is
available for use by the group.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include
the net present value of the following lease payments:
• fixed payments (including in-substance fixed payments), less any lease incentives receivable
• variable lease payment that are based on an index or a rate, initially measured using the index or rate as at the
commencement date
• amounts expected to be payable by the group under residual value guarantees
• the exercise price of a purchase option if the group is reasonably certain to exercise that option, and
• payments of penalties for terminating the lease, if the lease term reflects the group exercising that option.
Lease payments to be made under reasonably certain extension options are also included in the measurement of
the liability.
The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily
determined, which is generally the case for leases in the group, the lessee’s incremental borrowing rate is used,
being the rate that the individual lessee would have to pay to borrow the funds necessary to obtain an asset of
similar value to the right-of-use asset in a similar economic environment with similar terms, security and
conditions.
To determine the incremental borrowing rate, the group:
• where possible, uses recent third-party financing received by the individual lessee as a starting point, adjusted
to reflect changes in financing conditions since third party financing was received
• uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk for leases held by the
Company, which does not have recent third party financing, and
• makes adjustments specific to the lease, e.g., term, country, currency and security.
The group is exposed to potential future increases in variable lease payments based on an index or rate, which
are not included in the lease liability until they take effect. When adjustments to lease payments based on an
index or rate take effect, the lease liability is reassessed and adjusted against the right-of-use asset. Lease
payments are allocated between principal and finance cost. The finance cost is charged to profit or loss over the
lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each
period.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |35
1.
Summary of Material Accounting Policies (Continued)
(i)
Leases (Continued)
Right-of-use assets are measured at cost comprising the following:
• the amount of the initial measurement of lease liability
• any lease payments made at or before the commencement date less any lease incentives received
• any initial direct costs, and
• restoration costs.
Right-of-use assets are generally depreciated over the shorter of the asset’s useful life and the lease term on a
straight-line basis. If the group is reasonably certain to exercise a purchase option, the right-of-use asset is
depreciated over the underlying asset’s useful life. While the group re-values its land and buildings that are
presented within property, plant and equipment, it has chosen not to do so for the right-of-use buildings held by
the group.
Payments associated with short-term leases of equipment and vehicles and all leases of low-value assets are
recognised on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term
of 12 months or less without extension options. Low-value assets comprise IT equipment and small items of office
furniture.
(j)
Business Combinations
The acquisition method of accounting is used to account for all business combinations, including business
combinations involving entities or businesses under common control, regardless of whether equity instruments
or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the fair
values of the assets transferred, the liabilities incurred, and the equity interests issued by the Group.
The consideration transferred also includes the fair value of any contingent consideration arrangement and the
fair value of any pre-existing equity interest in the subsidiary.
Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values
at the acquisition date. On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest
in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net
identifiable assets.
The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the
acquisition date fair value of any previous equity interest in the acquiree over the fair value of the Group’s share
of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the
net identifiable assets of the subsidiary acquired and the measurement of all amounts has been reviewed, the
difference is recognised directly in profit or loss as a bargain purchase.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted
to their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing
rate, being the rate at which a similar borrowing could be obtained from an independent financier under
comparable terms and conditions.
Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial
liability are subsequently remeasured to fair value with changes in fair value recognised in profit or loss.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |36
1.
Summary of Material Accounting Policies (Continued)
(k)
Impairment of Non-Financial Assets
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested
annually for impairment, or more frequently if events or changes in circumstances indicate that they might be
impaired. Other assets are reviewed for impairment whenever events or changes in circumstances indicate that
the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the
asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair
value less costs of disposal and value in use.
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately
identifiable cash inflows that are largely independent of the cash inflows from other assets or groups of assets
(cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for
possible reversal of the impairment at each reporting date.
(l)
Property, Plant and Equipment
Property, plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure
that is directly attributable to the acquisition of the items. Depreciation is calculated on a straight-line basis to
write off the net cost of each item of property, plant and equipment over its estimated useful life to the
consolidated entity, or in the case of lease hold improvements, the shorter lease term. Estimates of remaining
useful lives are made on a regular basis for all assets.
The estimated useful lives for plant and equipment ranges between 2 and 20 years. Gains and losses on disposals
are determined by comparing proceeds with the carrying amount of the assets. These are included in profit or
loss.
(m)
Intangible Assets
i)
Software developed or acquired for sales and licensing
Research expenditure is recognised as an expense as incurred. Costs incurred on development projects
(relating to the design and testing of new areas of products) are recognised as intangible assets when it
is probable that the project will, after considering its commercial and technical feasibility, be completed
and generate future economic benefits and its costs can be measured reliably. The expenditure
capitalised comprises all directly attributable costs, including costs of materials, services, direct labour
and an appropriate proportion of overheads. Other development expenditures that do not meet these
criteria are recognised as an expense as incurred. Development costs previously recognised as an
expense are not recognised as an asset in a subsequent period. Capitalised development costs and
acquired software are recorded as intangible assets and amortised from the point at which the asset is
ready for use on a straight-line basis over its useful life, which varies from three to five years.
ii)
Software – internal management systems
Software licences used in internal management systems, whether acquired or internally developed are
stated at cost less amortisation. They are amortised on a straight-line basis over the useful life from 2.5
to 5 years.
iii)
Patents and trademarks
Costs associated with patents and trademarks are expensed as incurred.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |37
1.
Summary of Material Accounting Policies (Continued)
(m) Intangible Assets (Continued)
iv)
Customer Contracts and Relationships
The net assets acquired as a result of a business combination may include intangible assets other than
goodwill. Any such intangible assets are amortised in a straight line over their expected future lives. The
estimated useful life of customer contracts is 5 years.
v)
Goodwill
Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of
the net identifiable assets of the acquired subsidiary/business at the date of acquisition. Goodwill on
acquisition is included in intangible assets. Goodwill is not amortised. Instead, goodwill is tested for
impairment annually or more frequently if events or circumstances indicate that it might be impaired and
is carried at cost less accumulated impairment losses.
Goodwill is allocated to cash generating units for the purposes of impairment testing. The allocation is
made to those cash generating units or groups of cash generating units that are expected to benefit from
business combination in which goodwill arose, identified according to operating segments or
components of operating assets (note 26).
(n)
Trade and Other Payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial
year and which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition.
(o)
Employee Benefits
i)
Short term obligations
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave
expected to be settled within 12 months after the end of the period in which the employees render the
related service are recognised in respect of employees' services up to the end of the reporting period and
are measured at the amounts expected to be paid when the liabilities are settled. The liability for annual
leave and long service leave is recognised in the provision for employee benefits.
Other long-term employee benefit obligations
The liability for long service leave and other benefits which is not expected to be settled within 12 months
after the end of the period in which the employees render the related service is recognised in the provision
for employee benefits and measured as the present value of expected future payments to be made in
respect of services provided by employees up to the end of the reporting period using the projected unit
credit method. Consideration is given to expected future wage and salary levels, experience of employee
departures and periods of service. Expected future payments are discounted using market yields at the end
of the reporting period on commercial bonds with terms to maturity and currency that match, as closely as
possible, the estimated future cash outflows.
The obligations are presented as current liabilities in the consolidated statement of financial position if the
Group does not have an unconditional right to defer settlement for at least twelve months after the
reporting period, regardless of when the actual settlement is expected to occur.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |38
1.
Summary of Material Accounting Policies (Continued)
(p)
Employee Benefits (Continued)
ii)
Incentives
The Group recognises a liability and an expense for incentives based on a formula that takes into
consideration the profit attributable to the Company’s shareholders after certain adjustments. The Group
recognises a provision where contractually obliged or where there is a past practice that has created a
constructive obligation. Liabilities for incentive plans are expected to be settled within 12 months and are
measured at the amounts expected to be paid when they are settled.
iii)
Superannuation
The Group has a defined contribution superannuation plan for its eligible employees. Contributions to the
defined contribution fund are recognised as an expense as they become payable. Prepaid contributions are
recognised as an asset to the extent that a cash refund or a reduction in future payments is available.
iv)
Share-based payments
Share-based compensation benefits are provided to employees via the RPMGlobal Holdings Limited
employee share option plan (ESOP) and an employee share purchase plan. Information relating to these
schemes is set out in note 22.
The fair value of options granted under the ESOP is recognised as an employee benefit expense with a
corresponding increase in equity. The total amount to be expensed is determined by reference to the fair
value of the options granted, which includes any market performance conditions, but excludes the impact
of any service and non-market performance vesting conditions. Non-market vesting conditions are included
in assumptions about the number of options that are expected to vest. The total expense is recognised over
the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied.
At the end of each period, the Group revises its estimates of the number of options that are expected to
vest based on the non-market vesting conditions. It recognises the impact of the revision to original
estimates, if any, in profit or loss, with a corresponding adjustment to equity.
(p)
Value Added Taxes (Including Goods and Services Tax)
Revenues, expenses and assets are recognised net of the amount of Value Added Tax (VAT), except where the
amount of VAT is not recoverable from the relevant tax authority. In these circumstances the VAT is recognised
as part of the cost of acquisition of the asset or as part of the item as expense.
Receivables and payables are stated with the amount of VAT included. The net amount of VAT recoverable from,
or payable to, the relevant tax authority is included as a current asset or liability in the consolidated statement of
financial position. Cash flows are presented on a gross basis. The VAT components of the cash flows arising from
investing and financing activities which are recoverable from, or payable to, the relevant tax authority are
classified as operating cash flows.
(q)
Contributed Equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or
options are shown in equity as a deduction, net of tax, from the proceeds.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |39
1.
Summary of Material Accounting Policies (Continued)
(r)
Earnings per Share
i)
Basic earnings per share
Basic earnings per share is calculated by dividing:
•
the profit attributable to owners of the Company, excluding any costs of servicing equity other than
ordinary shares
•
by the weighted average number of ordinary shares outstanding during the financial year.
ii)
Diluted earnings per share
Dilutive earnings per share adjusts the figures used in determination of basic earnings per share to take into
account:
•
the after income tax effect of interest and other financing costs associated with dilutive potential
ordinary shares
•
the weighted average number of additional ordinary shares that would have been outstanding
assuming the conversion of all dilutive potential ordinary shares.
(s)
Financial Guarantee Contracts
Financial guarantee contracts are recognised as a financial liability at the time the guarantee is issued. The liability
is initially measured at fair value and subsequently at the higher of the loss allowance and the amount initially
recognised less cumulative amortisation, where appropriate.
(t)
Rounding of Amounts
The parent entity has applied the relief available to it under ASIC Corporations (Rounding in Financial/Directors
Reports) Instrument 2016/191 and accordingly, amounts in the financial statements and directors’ report have
been rounded off to the nearest $1,000, or in certain cases, the nearest dollar.
(u)
Comparative Figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
(v)
Critical Accounting Estimates and Significant Judgments
The preparation of the financial report in conformity with Australian Accounting Standards requires the use of
certain critical accounting estimates. It also requires management to exercise judgment in the process of applying
the accounting policies. The notes in the financial statements set out areas involving a higher degree of judgment
or complexity, or areas where assumptions are significant to the financial report such as:
•
impairment of intangible assets, including goodwill (note 10);
•
impairment of trade receivables and contract assets (note 20(a));
•
recognition of deferred tax assets (note 4); and
•
revenue recognition (note 1(f)).
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |40
1.
Summary of Material Accounting Policies (Continued)
(w)
Critical Accounting Estimates and Significant Judgments (Continued)
Estimates and judgments are continually evaluated and are based on historical experience and other factors,
including reasonable expectations of future events. Management believes the estimates used in preparation of
the financial report are reasonable.
(w)
Parent Entity Financial Information
The financial information for the parent entity, RPMGlobal Holdings Limited, disclosed in note 24 has been prepared
on the same basis as the consolidated financial statements, except as set out below:
(i)
Investments in subsidiaries
Investment in subsidiaries is accounted for at cost in the financial statements of RPMGlobal Holdings
Limited.
(x)
New Accounting Standards and Interpretations
There were no new or revised accounting standards adopted that had any impact on the Group’s accounting policies
or required retrospective adjustments.
Early adoption of standards
The Group has not early adopted any standards, interpretations or amendments that have been issued but are not
yet effective.
2.
Other income
2024
$'000
2023
$'000
Sale of the future royalty stream
3,145
-
Government Covid-19 subsidies
1
7
Foreign exchange gains
569
224
Bad debt impairment reversal
15
757
Other income
3,730
988
Government subsidies relating mostly to the People Republic of China’s Covid subsidies (2023: Hong Kong and
People Republic of China’s Covid subsidies) are included within the ‘other income’ line of the Consolidated
Statement of Comprehensive Income. There are no unfulfilled conditions or other contingencies attached to these
grants.
Government grants relating to costs are deferred and recognised in profit or loss over the period necessary to
match them with the costs that they are intended to compensate.
In November 2023 the Company received $3,145,000 from the once off sale of a potential future royalty stream
for its simulation software product.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |41
3.
Tax Expense
RPMGlobal Holdings Limited and its wholly-owned Australian controlled entities implemented the tax
consolidation regime. Under the tax consolidation legislation, the entities in the tax consolidated Group entered
into a tax sharing agreement which, in the opinion of the Directors, limits the joint and several liabilities of the
wholly-owned entities in the case of a default by the head entity, RPMGlobal Holdings Limited. The entities have
also entered into a tax funding agreement under which the wholly-owned entities fully compensate RPMGlobal
Holdings Limited for any current tax payable assumed and are compensated for any current tax receivable and
deferred tax assets relating to unused tax losses or unused tax credits that are transferred to RPMGlobal Holdings
Limited under the tax consolidated legislation. The funding amounts are determined by reference to the amounts
recognised in the wholly-owned entities’ financial statements.
Tax Recognised in profit or loss
2024
$'000
2023
$'000
Current tax
(1,412)
(1,253)
Deferred tax
107
4
Adjustments to prior periods
(203)
103
Income Tax expense
(1,508)
(1,146)
Numerical reconciliation of income tax expense to prima facie tax
Profit/(Loss) before income tax
10,164
4,834
Tax at the Australian tax rate of 30% (2023: 30%)
(3,049)
(1,450)
Tax effect of amounts which are not taxable/(deductible):
Non-deductible expense/non-assessable income
(924)
(525)
Unutilised foreign tax credits
(437)
(445)
Tax losses utilised which were not recognised as deferred tax asset in the past
2,173
1,012
Unrecognised deferred tax assets
-
(78)
Difference in overseas tax rates
564
123
Foreign Exchange movements
368
114
Over/(under) provision in prior years
(203)
103
Income tax expense
(1,508)
(1,146)
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |42
4.
Deferred Tax Assets and Liabilities
Deferred tax assets and liabilities are attributable to the following:
2024
$'000
2023
$'000
Provision for impairment of receivables
208
175
Employee benefits provision
4,438
4,346
Lease liabilities
1,996
2,474
Tax Losses
-
596
Contract liability
967
753
Accrued expenses
31
30
Share capital buyback and raising costs
79
46
Intangibles
(236)
(273)
Contract asset
(89)
(29)
Property, plant and equipment
(1,826)
(2,376)
Prepayments
(1,740)
(1,748)
Unrealised foreign exchange
(383)
(736)
Deferred tax assets
3,445
3,258
Deferred tax liabilities
-
-
Net Deferred tax assets
3,445
3,258
The group has not recognised deferred tax assets for a portion of tax losses in the parent entity and its
subsidiaries located in China, Chile, Brazil, and USA because it is not probable that sufficient future taxable profit
will be available. Capital losses do not expire; however, it is not probable that the Group would generate capital
gains to utilise the benefit. Deductible temporary differences in subsidiaries located in China, Chile, Brazil,
Kazakhstan, Turkey and USA have not been recognised because it is not probable that sufficient future taxable
profit will be available.
Movements in deferred tax assets
2024
$'000
2023
$'000
Balance at 1 July
3,258
3,281
Recognised in profit or loss
107
4
Recognised in other comprehensive income
14
(47)
Recognised in equity
66
20
Over/(under) provision in prior years
-
-
Balance at 30 June
3,445
3,258
Unrecognised deferred tax assets
Tax losses
12,731
16,912
Capital losses
2,084
2,489
Deductible temporary differences
3,881
3,779
Unrecognised deferred tax assets
18,696
23,180
Unrecognised gross temporary differences
63,578
78,571
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |43
4. Deferred Tax Assets and Liabilities (Continued)
Significant Estimates – Deferred Tax Assets
The recognition of the deferred tax asset of $3,445,000 is dependent on future taxable profits in excess of the
profits arising from the reversal of existing taxable temporary differences. At each reporting period, the
recoverability of the net deferred tax assets will be reassessed. This may lead to the recognition of this
unrecognised tax benefit in future reporting periods or the derecognition of deferred tax assets that are
currently recognised on the consolidated statement of financial position.
5.
Cash and Cash Equivalents
2024
$'000
2023
$'000
Cash at bank
25,887
26,961
Short-term bank deposits
8,322
7,796
34,209
34,757
6.
Trade and Other Receivables
Current
Trade receivables
23,486
24,395
Allowance for expected credit loss
(1,406)
(1,593)
Subtotal
22,080
22,802
Other receivables
127
28
Trade and Other Receivables
22,207
22,831
Non-current
Other receivables and deposits
215
236
Trade and Other Receivables
215
236
7.
Contract assets
Contract assets - Services
4,156
2,119
Contract assets – Software licences
2,841
1,772
Allowance for expected credit loss
(23)
(22)
Contract assets
6,974
3,869
Contract assets from services have increased as the group has provided more services ahead of the agreed
payment schedules for fixed-price contracts, see note 1(f). The group also recognised $2.8 million contract assets
in relation to the subscription licences issued ahead of the agreed payment schedule. The group also recognised
a loss allowance for contract assets in accordance with AASB 9, see note 1(g) and 20(a) for further information.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |44
8.
Other Assets
Current
2024
$'000
2023
$'000
Inventory
276
280
Incremental costs of obtaining a contract
1,976
2,322
Investment – Restricted Cash
906
414
Investment – Subleases
10
51
Prepayments
3,621
2,209
Other Assets
6,789
5,276
Non-current
Investment – Subleases
-
14
Incremental costs of obtaining a contract
3,201
4,384
Other Assets
3,201
4,398
Incremental costs of obtaining a contract
The group recognised an asset in relation to sales commissions and 3rd party royalty costs. The asset is amortised
on a straight-line basis over the term of the specific subscription contract it relates to which ranges between 1
and 5 years, consistent with the pattern of recognition of the associated revenue.
9.
Property, Plant and Equipment
Plant and equipment - at cost
8,999
8,648
Less: accumulated depreciation
(7,122)
(6,981)
Plant and Equipment
1,877
1,667
Leased building at cost - Right-of-use asset
16,320
18,737
Less: accumulated depreciation
(9,890)
(10,245)
Leased Buildings – Right-of-use asset
6,430
8,492
Property, Plant and Equipment
8,307
10,159
Plant and equipment - Balance at 1 July
1,667
1,380
Exchange differences
2
(13)
Additions
1,058
1,217
Depreciation
(850)
(917)
Balance at 30 June
1,877
1,667
Right-of-use asset - Balance at 1 July
8,492
2,598
Exchange differences
(40)
(29)
Additions (See Note 14 for further details)
1,087
9,141
Depreciation
(3,109)
(3,218)
Balance at 30 June
6,430
8,492
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |45
10.
Intangible Assets
2024
$'000
2023
$'000
Software developed and acquired for sale and licensing – at cost
4,533
18,786
Less: accumulated amortisation
(3,112)
(16,305)
Software developed and acquired for sale and licensing
1,421
2,481
Software internal management systems – at cost
4,990
4,990
Less: accumulated amortisation
(4,945)
(4,881)
Software internal management systems
45
109
Customer contracts and relationships – at cost
-
333
Less: accumulated amortisation
-
(324)
Customer contracts and relationships
-
9
Goodwill – at cost
37,230
37,155
Less: impairment losses
(10,584)
(10,509)
Goodwill
26,646
26,646
Intangible Assets
28,112
29,245
Customer
relationships
Software For
Sales to
Customers 1
Software For
Internal Use
Goodwill
Total
$'000
$'000
$'000
$'000
$'000
Balance at 30 June 2023
-
2,069
71
26,646
28,786
Additions
-
285
-
-
285
Exchange differences
-
(21)
-
-
(21)
Amortisation
-
(912)
(26)
-
(938)
Balance at 30 June 2024
-
1,421
45
26,646
28,112
Balance at 1 July 2022
9
2,481
109
26,646
29,245
Additions
-
189
-
-
189
Exchange differences
-
2
(2)
-
-
Business combinations
-
792
-
-
792
Amortisation
(9)
(1,395)
(36)
-
(1,440)
Balance at 30 June 2023
-
2,069
71
26,646
28,786
1 Software also includes capitalised development costs.
(a)
Impairment Tests for Goodwill
Goodwill is allocated to the Group's cash generating units (CGUs) according to business unit. A segment level
summary of the goodwill is presented below.
2024
$'000
2023
$'000
Software Division
21,612
21,612
Advisory Division
5,034
5,034
26,646
26,646
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |46
10.
Intangible Assets (Continued)
(b)
Key assumptions used for value-in-use calculations
In the current and prior years, the recoverable amount of the Software and Advisory CGU has been determined
by value-in-use calculations. These calculations were based on the following key assumptions:
Margin1
Growth Rate2
Discount Rate3
2024
2023
2024
2023
2024
2023
Software Division
63%
63%
5.0%
5.0%
14.9%
14.2%
Advisory
24%
23%
3.0%
2.5%
17.8%
17.5%
1 Budgeted gross margin
2 Weighted average growth rates used to extrapolate cash flows beyond the budget period
3 In performing the value-in-use calculations for each CGU, the group has applied both pre-tax and post-tax discount rates to discount
the forecast future attributable pre-tax and post-tax cash flows. The pre-tax discount rates are disclosed above
These assumptions have been used for the analysis of each CGU. Cash flows were projected based on financial
budgets and management projections over a five-year period including current and projected economic
conditions. Management determined budgeted gross margin based on past performance and its expectations for
the future. The weighted average growth rates used are consistent with forecasts included in industry reports.
The discount rates used reflect specific risks relating to the relevant segments.
(c)
Impact of possible changes in key assumptions
If any key assumptions increase or decrease by 20% it would not indicate impairment for Software or Advisory
Goodwill.
11.
Trade and Other Payables
Current
2024
$'000
2023
$'000
Trade payables
3,939
3,498
Other payables and accruals
8,694
9,433
Trade and Other Payables
12,633
12,931
Trade payables are amounts due to suppliers for goods purchased or services provided in the ordinary course of
business. Trade payables are generally due for settlement within 30 days and therefore are all classified as
current. Other payables and accruals generally arise from normal transactions within the usual operating activities
of the Group and comprise items such as employee taxes, incentives, employee on costs, GST and other recurring
items.
12.
Provisions
Current
Annual leave
3,490
3,051
Long service leave
3,804
3,292
Employee benefits
7,294
6,343
Non-current
Employee benefits – Long service leave
1,032
1,107
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |47
12.
Provisions (Continued)
The group also operates defined contribution plans in Australia, Canada and USA which receive fixed
contributions from group companies. The group’s legal or constructive obligation for these plans is limited to the
contributions. The expense recognised in the current period in relation to these contributions was $4,595,000
(2023: $4,119,000).
13.
Other Liabilities
Current
2024
$'000
2023
$'000
Contract liabilities - software maintenance and licences
21,877
21,217
Contract liabilities - consulting and advisory
7,122
5,807
Contingent consideration – at fair value
22
22
Lease liabilities
2,662
2,567
Other Liabilities
31,683
29,613
Non-current
Contingent consideration – at fair value
-
21
Lease liabilities
4,476
6,537
Other Liabilities
4,476
6,558
Contract liabilities consist of unearned income for software maintenance, subscriptions, licences and consulting
and advisory services. These liabilities have increased for software subscriptions in line with revenue compared
to 2023 as noted in the Consolidated Statement of Comprehensive Income, see note 1(f)(ix).
From the opening contract liability balances of $21,217,000 the group has recognised $21,063,000 in the
current reporting period. The group expects to recognise approximately all current contract liabilities in its 2024
revenues.
Additions to right-of-use assets and lease liabilities during the 2024 financial year were $1,087,000 (2023:
$9,141,000) the bulk of which primarily related to the company extending regional office leases and a new
office lease in Sydney, see note 9.
14.
Contributed Equity
2024
Number
2023
Number
2024
$'000
2023
$'000
Share capital
Ordinary shares - fully paid
223,255,967
228,022,637
82,967
93,877
Ordinary Shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in
proportion to the number of and amounts paid on the shares held. On a showing of hands every holder of ordinary
shares present at a meeting, in person or by proxy, is entitled to one vote and upon a poll each share is entitled
to one vote. Ordinary shares have no par value, and the Company does not have a limited amount of authorised
capital.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |48
14.
Contributed Equity (Continued)
Options
Information relating to the RPMGlobal Holdings Limited Employee Share Option Plan (ESOP), including details of
options issued, exercised and lapsed during the financial year and options outstanding at the end of financial year,
is set out in note 22.
Capital Risk Management
The Group’s objectives when managing capital include safeguarding the ability to continue as a going concern, so
they continue to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal
capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Group does not
have any externally imposed capital requirements.
Consistent with the industry practice, the Group monitors capital on the basis of the gearing ratio. This ratio is
calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including ‘borrowings’
and ‘trade and other payables’ as shown in the consolidated statement of financial position) less cash and cash
equivalents. Total capital is calculated as ‘equity’ as shown in the statement of financial position plus net debt.
As the Group does not have any debt, the gearing ratios at 30 June 2024 and 30 June 2023 were not applicable:
Notes
2024
2023
$'000
$'000
Total borrowings, trade and other payables
12,633
12,931
Less: cash and cash equivalents
5
(34,209)
(34,458)
Net (cash) / debt
(21,576)
(22,527)
Total equity
55,847
57,940
Total capital
34,271
36,413
Movements in Share Capital:
Details
Number of shares
$'000
Opening balance 1 July 2023
228,022,637
93,877
Exercise of options - proceeds received
2,500,073
695
Exercise of options - transferred from share option reserve
-
1,257
Less: Transaction costs arising on share issues
-
(30)
Shares bought back
(7,266,743)
(12,709)
Transaction costs arising on share buyback
-
(189)
Deferred tax credit recognised directly in equity
-
66
Balance 30 June 2024
223,255,967
82,967
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |49
14.
Contributed Equity (Continued)
Details
Number of shares
$'000
Opening balance 1 July 2022
231,704,960
100,427
Exercise of options - proceeds received
1,105,670
770
Exercise of options - transferred from share option reserve
-
239
Less: Transaction costs arising on share issues
-
(28)
Shares bought back
(4,787,993)
(7,476)
Transaction costs arising on share buyback
-
(75)
Deferred tax credit recognised directly in equity
-
20
Balance 30 June 2023
228,022,637
93,877
15.
Reserves
2024
2023
$'000
$'000
Share-based payments (i)
3,021
2,703
Foreign currency translation (ii)
(3,717)
(3,551)
Financial assets revaluation reserve (iii)
-
(1,601)
Revaluation surplus
-
18
Reserve arising from an equity transaction (iv)
-
(1,553)
Reserves
(696)
(3,984)
Nature and Purpose of Reserves
(i)
Share-based payments
The fair value of options issued to employees is recognised as an employment cost during the option vesting
period with corresponding increase in equity recognised in this reserve.
(ii)
Foreign currency translation
Exchange differences arising on translation of the foreign controlled entities are taken to the foreign currency
translation reserve, as described in accounting policy note 1(e).
(iii)
Financial assets revaluation reserve
Changes in the fair value of investments are recognised in equity securities in other comprehensive income. These
changes are accumulated in a separate reserve within equity.
(iv)
Reserve arising from an equity transaction
Arose from the acquisition of an additional interest in the controlled entity, RPMGlobal Africa (Pty) Ltd.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |50
15.
Reserves (Continued)
Movement in Reserves
Share-based payments
Foreign Currency
Translation
2024
2023
2024
2023
$'000
$'000
$'000
$'000
Balance at 1 July
2,703
1,815
(3,551)
(3,391)
Options expensed
1,605
1,150
-
-
Options exercised reclassified to share capital
(1,257)
(239)
-
-
Options lapsed reclassified to retained losses
(30)
(23)
-
-
Foreign currency translation
-
-
166
(160)
Balance at 30 June
3,021
2,703
(3,717)
(3,551)
Financial assets
revaluation reserve
Revaluation surplus
Reserve arising from an
equity transaction
2024
2023
2024
2023
2024
2023
$'000
$'000
$'000
$'000
$'000
$'000
Balance at 1 July
(1,601)
(1,601)
18
18
(1,553)
(1,553)
Transferred to retained losses
1,601
-
(18)
-
1,553
-
Balance at 30 June
-
(1,601)
-
18
-
(1,553)
There were no other movements in reserves in 2024 and 2023.
16.
Remuneration of Auditors
During the year, the following fees were paid or payable for services provided by the auditors of the Group, its
related entities, its network firms and unrelated firms.
2024
2023
Auditors of the Group – BDO and related network firms:
$
$
Audit and review of the financial statements:
Group
198,900
185,000
Auditors of subsidiaries
63,233
72,290
Total audit and review of the financial statements
262,133
257,290
Non -audit services
Taxation and transfer pricing advice
24,971
31,500
Taxation compliance services
2,000
3,950
Total non-audit services
26,971
35,450
Total services provided by BDO
289,104
292,740
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |51
17.
Dividends
Cents per share
Total
2024
2023
2024
2023
Cents
Cents
$'000
$'000
Fully paid ordinary shares
-
-
-
-
No dividend was declared in respect of the current financial year (2023: nil). The parent’s franking account balance
is 295,947 (2023: 295,947).
18.
Commitments
Software Subscription and Maintenance payments
The Group sold its software under non-cancellable software subscription agreements expiring within one to
five years. The agreements have varying terms and renewal rights. On renewal the terms of the subscriptions
are generally renegotiated. The group has also sold maintenance contracts committed for up to five years.
Future minimum payments to be received in relation to non-cancellable software subscriptions and maintenance:
2024
$'000
2023
$'000
Within one year
32,183
24,353
Later than one year but not later than 5 years
105,994
86,660
Over 5 years
-
-
Commitments not recognised in the financial statements
138,177
111,013
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |52
19.
Reconciliation of Net Profit to Net Cash Inflow from Operating Activities
2024
$'000
2023
$'000
Net profit
8,656
3,689
Depreciation and amortisation
4,897
5,575
Fair value movements
(70)
26
Impairments of trade receivables
199
168
Net exchange differences and comprehensive income
(223)
(703)
Employee share options
1,605
1,150
Change in operating assets and liabilities
Decrease / (increase) in trade and other receivables
645
(1,991)
Decrease / (increase) in current tax asset
1,508
430
Decrease / (increase) in deferred tax asset
(186)
23
Decrease / (increase) in contract asset
(3,105)
130
Decrease / (increase) in other assets
121
(1,503)
Increase / (decrease) in trade and other payables
(298)
716
Increase / (decrease) in contract liabilities
1,975
3,979
Increase / (decrease) in current tax liabilities
(93)
252
Increase / (decrease) in provisions
876
286
Net cash inflow from operating activities
16,507
12,227
Non-cash investing and financing activities disclosed in other notes are:
•
acquisition of right-of-use assets, see note 10;
•
partial settlement of a business combination with contingent consideration;
•
movement in lease liabilities reconciled to net cashflow is presented below
Balance as at 1 July (note 13)
9,104
3,131
Financing cash flows
(3,015)
(3,132)
New Leases (note 13)
1,087
9,141
Foreign exchange adjustments
(38)
(36)
Interest expense
(369)
(389)
Interest payments presented as operating cash flows
369
389
Balance as at 30 June (note 13)
7,138
9,104
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |53
20.
Financial Risk Management
The Group has exposure to the following risks from its use of financial instruments:
•
credit risk;
•
liquidity risk; and
•
market risk.
This note presents information about the Group’s exposure to each of the above risks, the objectives, policies
and processes for measuring and managing risk.
The Board of Directors is ultimately responsible for reviewing, ratifying and monitoring systems of internal
controls and risk management. The Board has established an Audit and Risk Committee, which is responsible for
overseeing risk management systems. The Group’s overall risk management program focuses on the
unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance
of the Group. The Group’s finance division is responsible for development and maintenance of policies which deal
with each type of risk related to use of financial instruments.
The Group holds the following financial instruments:
2024
2023
Financial assets
$'000
$'000
Cash and cash equivalents
34,209
34,757
Trade and other receivables 1
22,080
22,803
Financial Assets
56,289
57,560
Financial liabilities
Trade and other payables 1
12,633
12,931
Contingent consideration 2
22
42
Financial Liabilities
12,655
12,973
1 At amortised cost
2 At fair value
(a)
Credit Risk
Credit risk is the risk of financial loss to the Group if a customer or a counter party to a financial instrument fails
to meet its contractual obligations and arises principally from the Group’s cash and cash equivalents and its
receivables from customers.
The Group does not require guarantees or collateral of its trade and other receivables. In some foreign regions
the Group works on a prepayment basis to avoid credit risk.
The maximum credit risk exposure of financial assets of the Group is represented by the carrying amounts of
financial assets set out above. The Group had no significant concentrations of credit risk with any single
counterparty or group of counterparties. The Group holds its cash with AA and A-rated banks, except for the
banks located in Brazil (BBB), Kazakhstan (B), Mongolia (B), Turkey (B), South Africa (BB), Colombia (BB), China
(BBB) and Russia (BBB).
The group applies the AASB 9 simplified approach to measuring expected credit losses which uses a lifetime
expected loss allowance for all trade receivables and contract assets.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |54
20.
Financial Risk Management (Continued)
(a)
Credit Risk (Continued)
To measure the expected credit losses, trade receivables and contract assets have been grouped based on shared
credit risk characteristics and the days past due. The contract assets relate to unbilled satisfied performance
obligations and have substantially the same risk characteristics as the trade receivables for the same types of
contracts.
The group has therefore concluded that the expected loss rates for trade receivables are a reasonable
approximation of the loss rates for the contract assets.
The expected loss rates are based on the payment profiles of sales over a period of 60 months before 30 June
2024 and the corresponding historical credit losses experienced within this period. The historical loss rates are
adjusted to reflect current and forward-looking information on macroeconomic factors that affect the ability of
the customers to settle the receivables.
On that basis the loss allowance as at 30 June 2024 was determined as follows:
30 June 2024
Current
1 - 30 days
past due
30 - 90
days past
due
More than
90 days
past due
TOTAL
Expected loss rate
0.50%
0.47%
3.23%
30.36%
Gross carrying amount - trade receivables
13,959
3,861
1,516
4,150
23,486
Gross carrying amount – contract asset
6,997
-
-
-
6,997
Loss Allowance
102
18
49
1,260
1,429
30 June 2023
Current
1 - 30 days
past due
30 - 90
days past
due
More than
90 days
past due
TOTAL
Expected loss rate
0.75%
0.97%
5.31%
66.56%
Gross carrying amount - trade receivables
16,923
3,207
2,292
1,973
24,395
Gross carrying amount – contract asset
3,891
-
-
-
3,891
Loss Allowance
149
31
122
1,313
1,615
The closing loss allowances for trade receivables and contract assets as at 30 June 2024 reconcile to the opening
loss allowances as follows:
2024
2023
$'000
$'000
Opening loss allowance as at 1 July
1,615
1,548
Increase in loss allowance recognised in profit or loss during the period
199
168
Effects of foreign exchange
(16)
(49)
Impairment losses written off
(353)
(10)
Impairment losses recovered
(15)
(42)
At 30 June
1,430
1,615
Of the above impairment losses $199,000 (2023 - $168,000) relate to receivables arising from contracts with
customers. For Group’s policy on impairment, see note 1(g).
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |55
20.
Financial Risk Management (Continued)
(b)
Liquidity Risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The
Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity
to meet its liabilities when due without incurring unacceptable losses or risking damage to the Group’s
reputation. The Group regularly reviews cashflow forecasts and maintains sufficient cash on demand.
Contractual maturities of the Group’s financial liabilities, including interest thereon, are as follows:
2024
Carrying
amount
Contractual
cash flows
6 mths or
less
6-12 mths
1-2 years
2-5 years
More
than 5
years
$'000
$'000
$'000
$'000
$'000
$'000
$'000
Trade and other payables
12,633
12,633
12,633
-
-
-
-
Lease Liabilities
7,138
7,528
1,603
1,293
2,560
2,072
-
Contingent consideration
22
23
23
-
-
-
-
Total
19,793
20,184
14,259
1,293
2,560
2,072
-
2023
Trade and other payables
12,931
12,931
12,931
-
-
-
-
Lease Liabilities
9,104
9,799
1,550
1,346
2,476
4,427
-
Contingent consideration
42
45
-
22
23
-
-
Total
22,077
22,775
14,481
1,368
2,499
4,427
-
(c)
Market Risk
Currency Risk
Market Risk is the risk of exposure arising from recognised financial assets and liabilities not denominated in
Australian dollars. The current policy is not to take any forward positions. At 30 June 2024 and 30 June 2023, the
Group had not entered into any derivative contracts to hedge these exposures. The Group does not engage in
any significant transactions which are speculative in nature. As a multinational corporation, the Group maintains
operations in foreign countries and as a result of these activities, the Group is exposed to changes in exchange
rates which affect its results of operations and cash flows. The Group’s exposure to foreign currency risk at
reporting date expressed in Australian Dollars was as follows:
2024
USD
CAD
ZAR
Other
Total
$’000
$’000
$’000
$’000
$’000
Cash and deposits
17,941
5,120
4,758
3,012
30,831
Trade and other receivables
13,177
1,872
1,440
930
17,419
Trade and other payables
(432)
(212)
(479)
(262)
(1,385)
Net exposure
30,686
6,780
5,719
3,680
46,865
2023
Cash and deposits
9,459
3,971
10,946
2,553
26,929
Trade and other receivables
13,094
2,234
612
926
16,866
Trade and other payables
(265)
(353)
(693)
(172)
(1,483)
Net exposure
22,288
5,852
10,865
3,307
42,312
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |56
20.
Financial Risk Management (Continued)
(c)
Market Risk (Continued)
A 10 percent strengthening of the Australian dollar against the above currencies at 30 June 2024 based on assets
and liabilities at 30 June 2024 would have increased/(decreased) equity and profit or loss by the amounts shown
in the table below on the next page. This analysis assumes that all other variables, in particular interest rates,
remain constant. The analysis is performed on the same basis for 2023.
The Group manages its exposure to foreign currency fluctuations through a policy approved by the Board of
Directors. There are no other significant market risks affecting the Group.
2024
2023
Equity
Profit/(Loss)
Equity
Profit/(Loss)
$'000
$'000
$'000
$'000
(2,216)
(1,850)
(2,860)
(1,372)
A 10 percent weakening of the Australian dollar against the above currencies at 30 June 2023 would have had
equal but opposite effect on the above currencies to the amounts shown above.
Interest rate risk
Details of the Group’s borrowing facilities are presented below.
Borrowing
facilities
Currency
Nominal
interest
rate
Maturity
2024
2023
Facility
Utilised
Facility
Utilised
$’000
$’000
$’000
$’000
Other facilities
Bank guarantee
AUD
1.00%
n/a
2,000
1,573
2,000
1,664
Bank guarantee
AUD
1.95%
n/a
25
25
25
25
In both 2024 and 2023 financial years bank guarantees were secured by the Group’s term deposits.
(d)
Fair Value of financial instruments
Fair value hierarchy
AASB 13 Fair Value Measurement requires disclosure of fair value measurements by level in the fair value
measurement hierarchy as follows:
- Level 1 - the instrument has quoted prices (unadjusted) in active markets for identical assets or liabilities
- Level 2 - a valuation technique is used using inputs other than quoted prices within level 1 that are
observable for the financial instrument, either directly (i.e., as prices), or indirectly (i.e., derived from
prices)
- Level 3 - a valuation technique is used using inputs that are not observable based on observable market
data (unobservable inputs).
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |57
20.
Financial Risk Management (Continued)
(d)
Fair Value of financial instruments (Continued)
Recurring fair value measurements
The following financial instruments are subject to recurring fair value measurements:
2024
$'000
2023
$'000
Contingent consideration – level 3
22
43
Contingent consideration in 2023 was recognised on the acquisition of Splashback Solutions in November 2022
has been estimated by calculating the present value of the future expected cash outflows for two annual
payments of $23,000 dollars discounted at 5.25%. The company concluded a significant one-off sale of Splashback
software in 2024, which resulted in the higher than expected earnout in 2024.
No reasonable changes to any of the key assumptions would result in a material change to contingent
consideration.
Reconciliation of level 3 movements
The following table sets out the movements in level 3 fair values for contingent consideration payable.
2024
$'000
2023
$'000
Opening balance 1 July
43
143
Recognised on business combination
-
41
Payments of contingent consideration
(90)
(165)
Foreign exchange differences
-
(2)
Fair value adjustments
69
26
Closing balance 30 June
22
43
Valuation processes for level 3 fair values
Valuations are performed every six months to ensure that they are current for the half-year and annual financial
statements.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |58
21.
Earnings Per Share
2024
2023
Cents
Cents
Total basic earnings per share attributable to the ordinary equity
holders of the company
3.8
1.6
Total diluted earnings per share attributable to the ordinary equity
holders of the company
3.8
1.6
Earnings used in Calculating Earnings Per Share
2023
$’000
2022
$’000
Profit/(Loss) attributable to the ordinary equity holders used in calculating
earnings per share:
Profit/(Loss) for the period
8,656
3,689
Weighted average number of ordinary shares used as the
denominator in calculating basic earnings per share
225,114,897
230,087,599
Dilutive options
5,371,949
6,637,609
Weighted average number of ordinary shares used as the
denominator in calculating diluted earnings per share
230,486,846
236,725,208
22.
Share Based Payments
Tax Exempt Share Plan
The Employee Share Scheme enables the Board to issue up to $1,000 of shares tax free per employee of the
Group each year. There were no shares issued under the $1,000 Share Purchase Plan in 2024 or 2023.
Eligibility for the tax exempt share plan is approved by the board having regard to individual circumstances and
performance. No directors or key management personnel are eligible for the Tax Exempt Share Plan.
Employee Share Option Plan (ESOP)
The Employee Share Option Plan (ESOP) was approved by the Board of Directors on 5 February 2008, amended
on 7 October 2009, 28 October 2011, 29 October 2013, 24 November 2016, 15 October 2019 and most recently
following approval of shareholders at the Company’s 2023 Annual General Meeting held on 20 October 2023.
Eligible participants of the ESOP include any person who is employed by, or is a director, officer or executive (or
their approved permitted nominee), of the Group and whom the Board or its nominee determines is eligible to
participate in the Option Plan. A permitted nominee includes a company controlled by the employee, a trust in
which the employee has, or may have entitlements or such other entity as approved by the Board. Options are
granted at the discretion of the Board of Directors.
All options under the ESOP are to be offered to eligible employees for no consideration. The offer to the eligible
participant must be in writing and specify amongst other things, the number of options for which the eligible
employee may apply, the period within which the options may be exercised, any conditions to be satisfied before
exercise, the option expiry date and the exercise price of the options, as determined by the Board. The Board can
impose any restrictions on the exercise of options as it considers fit.
The rules of the ESOP plan enable the Board to determine the applicable vesting criteria and to set a timetable
for vesting of options in the offer document, including vesting in tranches over a defined period. The Board has
the discretion on whether or not to set performance hurdles for vesting or to link vesting solely to a defined
service period in order to drive key staff retention and reward longevity of service.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |59
22.
Share Based Payments (Continued)
The options may be exercised, in part or full, subject to the employee continuing to be employed at the relevant
vesting dates, by the participant giving a signed notice to the Company and paying the exercise price in full. The
Company will apply for official quotation of any Shares issued on exercise of any options.
The rules of the plan allow the Board to set the exercise price per Option in the offer document.
Subject to the accelerated expiry terms set out in the ESOP plan (explained further below), options will expire five
years after the date of grant subject to the option holder remaining employed by the Group. Unexercised options
will automatically lapse upon expiry. Unless determined otherwise by the Board, in the event of stated events
detailed in the plan, including termination of employment or resignation, redundancy, death or disablement or
in the event of a change of control of an employee’s permitted nominee, unvested options shall lapse and the
expiry date of any vested options will be adjusted in accordance with the accelerated timetables set out in the
ESOP plan rules (subject to the Board’s discretion to extend the term of exercise in restricted cases).
Once shares are allotted upon exercise of the options the participant will hold the shares free of restrictions. The
shares will rank equally for dividends declared on or after the date of issue but will carry no right to receive any
dividend before the date of issue. Should the Company undergo a reorganisation or reconstruction of capital or
any other such change, the terms of the options (including number or exercise price or both) will be
correspondingly changed to the extent necessary to comply with the Listing Rules. With this exception, the terms
for the exercise of each Option remains unchanged. In the event of a change of control of the Company, all options
will vest immediately and may be exercised by the employee (regardless of whether the vesting conditions have
been satisfied). A holder of options is not entitled to participate in dividends, a new or bonus issue of Shares or
other securities made by the Company to Shareholders merely because he or she holds options.
The Options are not transferable, assignable or able to be encumbered, without Board consent and the options
will immediately lapse upon any assignment, transfer or encumbrance, with the exception of certain dealings in
the event of death of the option holder.
The ESOP plan will be administered by the Board which has an absolute discretion to determine appropriate
procedures for its administration and resolve questions of fact or interpretation and formulate terms and
conditions (subject to the Listing Rules) in addition to those set out in the ESOP plan.
The ESOP plan may be terminated or suspended at any time by the Board. The ESOP plan may be amended or
modified at any time by the Board except where the amendment reduces the rights of the holders of options,
unless required by the Corporations Act or the Listing Rules, to correct any manifest error or mistake or for which
the option holder consents. The Board may waive or vary the application of the ESOP plan rules in relation to any
eligible employee at any time.
Employee Benefits expense
Share-based payment expense recognised during the financial year
2024
$’000
2023
$’000
Options issued under employee option plan
1,605
1,150
1,605
1,150
The options issued in prior years vest in tranches over a three year period from the date of grant, with vesting
conditions solely linked to the holder maintaining employment with the Group over that period and are issued
at an exercise price based on the volume weighted average price of the Company’s shares in the five days prior
to each grant. Options issued in 2023 and 2024 vest in three years from the grant date, with vesting conditions
linked to the holder maintaining employment with the Group over that period and Total Shareholder Return on
shares overperforming ASX 300 accumulated index (AXCOA).
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |60
22.
Share Based Payments (Continued)
Grant
Vesting
Expiry
Exercise
Number
Granted
Forfeited
Exercised
Share
Number
date
date
date
Price
beginning
Price
at end
$
of year
$ 1
of year
2024
Options granted to employees
13/09/18
13/09/19
13/09/23
0.61
88,329
-
(5,000)
(83,329)
1.46
-
13/09/18
13/09/20
13/09/23
0.61
116,659
-
(5,000)
(111,659)
1.46
-
13/09/18
13/09/21
13/09/23
0.61
476,683
-
(5,000)
(471,683)
1.46
-
14/12/18
14/12/19
14/12/23
0.58
44,665
-
(6,666)
(37,999)
1.62
-
14/12/18
14/12/20
14/12/23
0.58
103,001
-
(6,667)
(96,334)
1.62
-
14/12/18
14/12/21
14/12/23
0.58
203,004
-
(6,667)
(196,337)
1.62
-
15/03/19
15/03/20
15/03/24
0.58
51,666
-
(51,666)
-
-
-
15/03/19
15/03/21
15/03/24
0.58
85,000
-
(51,667)
(33,333)
1.78
-
15/03/19
15/03/22
15/03/24
0.58
118,335
-
(51,667)
(66,668)
1.78
-
14/09/20
14/09/21
14/09/25
1.15
16,666
-
-
-
-
16,666
14/09/20
14/09/22
14/09/25
1.15
16,666
-
-
-
-
16,666
14/09/20
14/09/23
14/09/25
1.15
50,002
-
-
(33,334)
1.50
16,668
12/11/20
12/11/23
12/11/25
-
1,121,713
-
-
(727,850)
1.85
393,863
23/03/21
23/03/24
23/03/26
-
1,154,670
-
-
(641,549)
2.39
513,121
3/09/21
3/09/24
3/09/26
-
944,198
-
(10,475)
-
-
933,723
25/02/22
25/02/25
25/02/27
-
666,853
-
(21,864)
-
-
644,989
26/09/22
26/06/25
26/09/27
-
1,379,499
-
(40,000)
-
-
1,339,499
1/09/2023
1/09/2026
1/09/2028
-
-
1,547,350
(50,596)
-
-
1,496,754
TOTAL
6,637,609
1,547,350
(312,935)
(2,500,075)
-
5,371,949
Weighted average exercise price, $
0.13
-
0.35
0.28
1.85
0.01
Grant
Vesting
Expiry
Exercise
Number
Granted
Forfeited
Exercised
Share
Number
date
date
date
Price
beginning
Price
at end
$
of year
$ 1
of year
2023
Options granted to employees
31/10/17
31/10/18
31/10/22
0.77
168,329
-
(33,333)
(134,996)
1.68
-
31/10/17
31/10/19
31/10/22
0.77
168,334
-
(33,333)
(135,001)
1.68
-
31/10/17
31/10/20
31/10/22
0.77
268,338
-
(33,334)
(235,004)
1.68
-
15/03/18
15/03/19
15/03/23
0.67
20,001
-
-
(20,001)
1.44
-
15/03/18
15/03/20
15/03/23
0.67
20,001
-
-
(20,001)
1.44
-
15/03/18
15/03/21
15/03/23
0.67
19,998
-
-
(19,998)
1.44
-
13/09/18
13/09/19
13/09/23
0.61
154,997
-
-
(66,668)
1.47
88,329
13/09/18
13/09/20
13/09/23
0.61
259,996
-
-
(143,337)
1.47
116,659
13/09/18
13/09/21
13/09/23
0.61
551,680
-
-
(74,997)
1.47
476,683
14/12/18
14/12/19
14/12/23
0.58
74,331
-
-
(29,666)
1.51
44,665
14/12/18
14/12/20
14/12/23
0.58
107,668
-
-
(4,667)
1.51
103,001
14/12/18
14/12/21
14/12/23
0.58
224,338
-
-
(21,334)
1.51
203,004
1 Weighted average share price at the exercise date
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |61
22.
Share Based Payments (Continued)
Grant
Vesting
Expiry
Exercise
Number
Granted
Forfeited
Exercised
Share
Number
date
date
date
Price
beginning
Price
at end
$
of year
$ 1
of year
2023
Options granted to employees (continued)
15/03/19
15/03/20
15/03/24
0.58
51,666
-
-
-
-
51,666
15/03/19
15/03/21
15/03/24
0.58
85,000
-
-
-
-
85,000
15/03/19
15/03/22
15/03/24
0.58
285,002
-
-
(166,667)
1.46
118,335
14/09/20
14/09/21
14/09/25
1.15
16,666
-
-
-
-
16,666
14/09/20
14/09/22
14/09/25
1.15
49,999
-
-
(33,333)
1.49
16,666
14/09/20
14/09/23
14/09/25
1.15
50,002
-
-
-
-
50,002
12/11/20
12/11/23
12/11/25
-
1,257,253
-
(135,540)
-
-
1,121,713
23/03/21
23/03/24
23/03/26
-
1,233,524
-
(78,854)
-
-
1,154,670
3/09/21
3/09/24
3/09/26
-
1,214,781
-
(270,583)
-
-
944,198
25/02/22
25/02/25
25/02/27
-
759,775
-
(92,922)
-
-
666,853
26/09/22
26/06/25
26/09/27
-
-
1,498,633
(119,134)
-
-
1,379,499
TOTAL
7,041,679
1,498,633
(797,033)
(1,105,670)
1.57
6,637,609
Weighted average exercise price, $
0.24
-
0.10
0.70
0.13
1 Weighted average share price at the exercise date
The weighted average remaining contractual life of share options outstanding at the end of the period was 2.9
years (2023: 2.7 years).
The fair values at grant date for the options were estimated using a Trinomial Lattice model which defines the
conditions under which employees are expected to exercise their options after vesting in terms of the stock
price reaching a specified multiple of the exercise price. For zero exercise price options, the Monte Carlo
simulation run by the model takes into account multiple scenarios for the exercising of the options.
The model inputs for options granted during the 2024, 2023, 2022, 2021, 2019, 2018, 2017 financial years
included:
Grant
Vesting
Share
Exercise
Expected
Weighted
Expected
Risk-free
Fair value
date
date
Price
price
volatility
average
dividends
interest
at grant
$
$
%
life, years
%
rate1,%
Date, $
31/10/17
31/10/18
0.77
0.77
42
5.0
nil
2.24
0.19
31/10/17
31/10/19
0.77
0.77
42
5.0
nil
2.24
0.23
31/10/17
31/10/20
0.77
0.77
42
5.0
nil
2.24
0.26
15/03/18
15/03/19
0.67
0.67
42
5.0
nil
2.30
0.17
15/03/18
15/03/20
0.67
0.67
42
5.0
nil
2.30
0.20
15/03/18
15/03/21
0.67
0.67
42
5.0
nil
2.30
0.23
13/09/18
13/09/19
0.65
0.61
41
5.0
nil
2.22
0.17
13/09/18
13/09/20
0.65
0.61
41
5.0
nil
2.22
0.21
13/09/18
13/09/21
0.65
0.61
41
5.0
nil
2.22
0.23
14/12/18
14/12/19
0.58
0.58
41
5.0
nil
2.14
0.14
14/12/18
14/12/20
0.58
0.58
41
5.0
nil
2.14
0.17
14/12/18
14/12/21
0.58
0.58
41
5.0
nil
2.14
0.19
15/03/19
15/03/20
0.55
0.58
41
5.0
nil
1.60
0.12
1 based on government bonds
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |62
22.
Share Based Payments (Continued)
Grant
Vesting
Share
Exercise
Expected
Weighted
Expected
Risk-free
Fair value
date
date
Price
price
volatility
average
dividends
interest
at grant
$
$
%
life, years
%
rate1,%
Date, $
15/03/19
15/03/21
0.55
0.58
41
5.0
nil
1.60
0.15
15/03/19
15/03/22
0.55
0.58
41
5.0
nil
1.60
0.17
7/06/19
7/06/21
0.59
0.60
41
5.0
nil
1.14
0.16
7/06/19
7/06/22
0.59
0.60
41
5.0
nil
1.14
0.19
14/09/20
14/09/21
1.14
1.15
45
5.0
nil
0.40
0.28
14/09/20
14/09/22
1.14
1.15
45
5.0
nil
0.40
0.34
14/09/20
14/09/23
1.14
1.15
45
5.0
nil
0.40
0.39
12/11/20
12/11/23
1.12
-
45
5.0
nil
0.30
0.70
23/03/21
23/03/24
1.29
-
45
5.0
nil
0.46
0.80
3/09/21
3/09/24
1.96
-
45
5.0
nil
0.63
1.19
25/02/22
25/02/25
1.79
-
45
5.0
nil
1.94
1.12
26/09/22
26/09/25
1.52
-
41
5.0
nil
3.84
0.93
01/09/23
01/09/26
1.61
-
38
5.0
nil
3.75
0.95
1 based on government bonds
The expected price volatility is based on the historic volatility compared to that of similar listed companies and
the remaining life of the options.
23.
Operating Segments
Operating segments are reported in a manner consistent with the internal reporting provided to the CEO in order
to make decisions about resource allocations and to assess performance of the Group. The reports are split into
functional divisions: Software Division, Advisory Division.
Software Division provides all of the Group’s Software offerings, including support (maintenance), training and
implementation services to mining companies. Advisory Division provides consulting and advisory services which
cover technical and economic analysis and assessment of mining activities and resources on behalf of mining
companies, financial institutions, customers of mining companies (e.g., coal fired electricity generators), lessors
and potential lessors of mineral rights to mining companies, government departments and agencies and suppliers
to mining companies and projects. Segment revenue, expenses and results include transfers between segments.
Such transfers are priced on an “arms-length” basis and are eliminated on consolidation.
(a) Geographical Information
2024
2023
Revenues from
contracts with
customers
$’000
Non-current
assets1
$’000
Revenues from
contracts with
customers
$’000
Non-current
assets1
$’000
Australia
38,710
37,819
38,832
37,381
Asia
15,752
294
12,061
404
Americas
28,076
1,410
24,124
4,775
Africa & Europe
27,046
312
22,355
1,019
Operating Segment
109,584
39,835
97,372
43,579
1 Excludes financial instruments and deferred tax assets
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |63
23.
Operating Segments (Continued)
Segment revenue is based on the geographical location of customers and segment assets are based on the
geographical location of the assets.
(b)
Information about reportable segments
2024
2023
Software
Division
Advisory
Division
Total
Software
Division
Advisory
Division
Total
$’000
$’000
$’000
$’000
$’000
$’000
Revenue
External Sales
75,225
37,521
112,746
66,069
31,303
97,372
Inter-segment sales
329
124
453
362
119
481
Total Revenue
75,554
37,645
113,199
66,431
31,422
97,853
Inter-segment expenses
(124)
(329)
(453)
(119)
(362)
(481)
Rechargeable expenses
(2,882)
(6,239)
(9,121)
(2,150)
(4,651)
(6,801)
Net revenue
72,548
31,077
103,625
64,162
26,409
90,571
Expenses
(34,018)
(23,310)
(57,328)
(29,896)
(20,498)
(50,394)
Software Development
(19,088)
-
(19,088)
(18,218)
-
(18,218)
Segment profit
19,442
7,767
27,209
16,048
5,911
21,959
(c)
Disaggregation of revenue from contracts with customers
Revenue
Segment Revenue
75,554
37,645
113,199
66,431
31,422
97,853
Inter-segment revenue
(329)
(124)
(453)
(362)
(119)
(481)
Other revenue
(3,145)
(16)
(3,161)
-
-
-
Revenue from external customers
72,080
37,505
109,585
66,069
31,303
97,372
Timing of revenue recognition
At a point in time
1,302
-
1,302
2,916
-
2,916
Over time
70,778
37,505
108,283
63,153
31,303
94,456
Revenue from contracts with customers
72,080
37,505
109,585
66,069
31,303
97,372
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |64
23.
Operating Segments (Continued)
(d) Reconciliation of segment profit to reported net profit:
2024
$'000
2023
$'000
Segment result
27,209
21,959
Adjustments:
Foreign exchange gains
569
224
Other income
-
764
Employment benefits – corporate and IT
(7,756)
(6,674)
Other unallocated costs – corporate and IT
(4,703)
(4,276)
Depreciation and amortisation
(4,897)
(5,575)
Ukraine and Russia - Bad debts
-
(168)
Redundancy costs
(479)
(1,248)
Net finance income / (costs)
221
(171)
Profit before income tax
10,164
4,835
Income tax expense
(1,508)
(1,146)
Profit after income tax
8,656
3,689
24.
Parent Entity Disclosures
As at and throughout the financial year ending 30 June 2024 the parent entity of the Group was RPMGlobal
Holdings Limited.
Summary financial information
The individual financial statements for the parent entity show the following aggregation:
Result of parent entity
2024
$000
2023
$000
Profit/(loss)
5,571
2,778
Other comprehensive income
-
-
Total comprehensive income
5,571
2,778
Financial position of parent entity at year end
Current assets
40,246
44,282
Total assets
66,347
72,455
Current liabilities
10,690
10,468
Total liabilities
17,332
18,532
Total equity of the parent entity comprising of:
Issued capital
82,967
93,877
Share-based Payments Reserve
3,021
2,704
Revaluation Surplus Reserve
0
18
Reserve Arising From an Equity Transaction
(600)
(600)
Accumulated losses
(36,373)
(42,076)
Total equity
49,015
53,923
Contingent liabilities
-
-
Contractual commitments for the acquisition or property, plant or equipment
-
-
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |65
25.
Interests in other entities
(a)
Material subsidiaries
The Group’s principal subsidiaries at 30 June 2024 are set out below. All subsidiaries have share capital consisting
solely of ordinary shares that are 100% (2024: 100%) held directly by the Group, and the proportions of ownership
interests held equals the voting rights held by the Group. The country of incorporation or registration is also their
principal place of business.
Name of entity
Place of business/
incorporation
Principal Activities
RPM Software Pty Ltd
Australia
Software Sales and Services
RPM Advisory Services Pty Ltd
Australia
Advisory Services
RPM Software International Pty Ltd
Australia
Software Sales and Services
RPMGlobal USA, Inc.
USA
Advisory Services
RPM Software USA, Inc.
USA
Software Sales and Services
RPMGlobal Canada Ltd
Canada
Software Sales and Services
PT RungePincockMinarco
Indonesia
Advisory Services
RPMGlobal Asia Limited
Hong Kong
Advisory Services
RPMGlobal China Limited
China
Advisory Services
RPMGlobal LLC
Mongolia
Advisory Services
RPMGlobal LLC (deregistered 30 July 2024)
Russia
Software Sales and Services
RPMGlobal Singapore Pte. Ltd.
Singapore
Software Sales and Services
RPMGlobal Africa (Pty) Ltd
South Africa
Software Sales and Services
RPMGlobal Chile Limitada
Chile
Software Sales and Services
RPMGlobal Software Do Brasil Ltda
Brazil
Software Sales and Services
Revolution Mining Software Inc
Canada
Software Sales and Services
IMAFS Inc
Canada
Software Sales and Services
iSolutions International Pty Ltd
Australia
Software Sales and Services
iSolutions Holdings Pty Ltd
Australia
Software Sales and Services
MineOptima Holdings Pty Ltd
Australia
Software Sales and Services
MineOptima Operations Pty Ltd
Australia
Software Sales and Services
Minvu Pty Ltd
Australia
Software Sales and Services
Minvu Holdings Pty Ltd
Australia
Software Sales and Services
Nitro Solutions Pty Ltd
Australia
Advisory Services
Blueprint Environmental Strategies Pty Ltd
Australia
Advisory Services
Splash Back Solutions Pty Ltd
Australia
Software Sales and Services
Kurilpa Investments Pty Ltd
Australia
Software Sales and Services
RPM Global Turkey Danışmanlık Hizmetleri ve Ticaret A.Ş.
Turkey
Advisory Services
RPMGlobal Kazakhstan LLP
Kazakhstan
Software Sales and Services
RPMGlobal Colombia SAS
Colombia
Software Sales and Services
All entities trade as RPM and RPMGlobal.
For personal use only
NOTES ON THE FINANCIAL STATEMENTS
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |66
25.
Interests in other entities (Continued)
(b) Significant Restrictions
Cash and short term deposits held in Chile, Brazil, South Africa, China, Indonesia, Mongolia and Russia are subject
to local exchange control regulations. These regulations provide restrictions on exporting capital from those
countries other than through normal trading transactions or dividends. The carrying amount of cash included
within the consolidated financial statements to which these restrictions apply is $16,190,000 (2023: $11,009,000).
26.
Key Management Personnel Disclosures
(a) Compensation
2024
2023
$
$
Short term employee benefits
3,287,953
2,854,554
Post-employment benefits
85,504
87,899
Share-based payments
127,861
137,459
3,501,318
3,079,912
No other transactions with Key Management personal occurred during the year.
27.
Events occurring after the reporting period
No matter or circumstance have arisen since 30 June 2024 that has significantly affected the Group’s operations,
results or state of affairs, or may do so in the future years.
28.
Contingent liabilities and contingent assets
There are no contingent liabilities or contingent assets that require disclosure in the financial report.
For personal use only
CONSOLIDATED ENTITY DISCLOSURE STATEMENT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |67
As at 30 June 2024
Outlined below is the Group’s consolidated entity disclosure statements as at 30 June 2024 prepared in
accordance with the Corporations Act 2001 (Cth).
Name of entity
Percent
Held (%)
Place of
incorporation
Australian
resident or
foreign
resident
Foreign
jurisdiction(s)
of foreign
residents
RPMGlobal Holdings Limited
n/a
Australia
Australian
n/a
RPM Software Pty Ltd
100
Australia
Australian
n/a
RPM Advisory Services Pty Ltd
100
Australia
Australian
n/a
RPM Software International Pty Ltd
100
Australia
Australian
n/a
RPMGlobal USA, Inc.
100
USA
Foreign
USA
RPM Software USA, Inc.
100
USA
Foreign
USA
RPMGlobal Canada Ltd
100
Canada
Foreign
Canada
PT RungePincockMinarco
100
Indonesia
Foreign
Indonesia
RPMGlobal Asia Limited
100
Hong Kong
Foreign
Hong Kong
RPMGlobal China Limited
100
China
Foreign
China
RPMGlobal LLC
100
Mongolia
Foreign
Mongolia
RPMGlobal LLC (deregistered 30 July 2024)
100
Russia
Foreign
Russia
RPMGlobal Singapore Pte. Ltd.
100
Singapore
Foreign
Singapore
RPMGlobal Africa (Pty) Ltd
100
South Africa
Foreign
South Africa
RPMGlobal Mining SA (Pty) Ltd
100
South Africa
Foreign
South Africa
ISIPLAfrica (Pty) Ltd
100
South Africa
Foreign
South Africa
RPMGlobal Chile Limitada
100
Chile
Foreign
Chile
RPMGlobal Software Do Brasil Ltda
100
Brazil
Foreign
Brazil
Revolution Mining Software Inc
100
Canada
Foreign
Canada
IMAFS Inc
100
Canada
Foreign
Canada
iSolutions International Pty Ltd
100
Australia
Australian
n/a
iSolutions Holdings Pty Ltd
100
Australia
Australian
n/a
MineOptima Holdings Pty Ltd
100
Australia
Australian
n/a
MineOptima Operations Pty Ltd
100
Australia
Australian
n/a
Minvu Pty Ltd
100
Australia
Australian
n/a
Minvu Holdings Pty Ltd
100
Australia
Australian
n/a
Nitro Solutions Pty Ltd
100
Australia
Australian
n/a
Blueprint Environmental Strategies Pty Ltd
100
Australia
Australian
n/a
Splash Back Solutions Pty Ltd
100
Australia
Australian
n/a
Kurilpa Investments Pty Ltd
100
Australia
Australian
n/a
RPMGlobal Innovations Pty Ltd
100
Australia
Australian
n/a
RPM Advisory Services International Pty Ltd
100
Australia
Australian
n/a
International Mineral Asset Transactions Pty Ltd
100
Australia
Australian
n/a
RPM Global Turkey Danışmanlık Hizmetleri ve Ticaret A.Ş.
100
Turkey
Foreign
Turkey
RPMGlobal Kazakhstan LLP
100
Kazakhstan
Foreign
Kazakhstan
RPMGlobal Colombia SAS
100
Colombia
Foreign
Colombia
For personal use only
CONSOLIDATED ENTITY DISCLOSURE STATEMENT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |68
(Continued)
All entities are body corporates, and no entities are trustees, partners or participants in joint ventures.
Determination of Tax Residency
Section 295 (3A) of the Corporations Act 2001 requires that the tax residency of each entity which is included in
the Consolidated Entity Disclosure Statement be disclosed.
Determination of Tax Residency (continued)
The determination of tax residency involves judgment. In determining tax residency, the entity has applied
current Australian and foreign legislation and any judicial precedent relevant to the interpretation of that
legislation.
In the context of an entity which was an Australian resident, “Australian resident” has the meaning provided in
the Income Tax Assessment Act 1997. The Consolidated entity has also had regard to the Commissioner of
Taxation’s public guidance.
For personal use only
DIRECTORS’ DECLARATION
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |69
In the directors' opinion:
•
the attached financial statements and notes thereto comply with the Corporations Act 2001, the
Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting
requirements;
•
the attached financial statements and notes thereto comply with International Financial Reporting
Standards as issued by the International Accounting Standards Board as described in note 1 (a) to the
financial statements;
•
the attached financial statements and notes thereto give a true and fair view of the consolidated entity's
financial position as at 30 June 2024 and of its performance for the financial year ended on that date;
•
the remuneration disclosures included in pages 14 to 21 of the Directors’ report (as part of audited
Remuneration Report), for the year ended 30 June 2024, comply with section 300A of the Corporations
Act 2001;
•
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they
become due and payable; and
•
the consolidated entity disclosure statement on pages 67-68 is true and correct;
The directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of Directors
Stephen Baldwin,
Chairman
Dated this 26 August 2024
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BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd
ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a
UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme
approved under Professional Standards Legislation.
70
Tel: +61 7 3237 5999
Fax: +61 7 3221 9227
www.bdo.com.au
Level 10, 12 Creek Street
Brisbane QLD 4000
GPO Box 457 Brisbane QLD 4001
Australia
INDEPENDENT AUDITOR'S REPORT
To the members of RPMGlobal Holdings Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of RPMGlobal Holdings Limited (the Company) and its subsidiaries
(the Group), which comprises the consolidated statement of financial position as at 30 June 2024, the
consolidated statement of comprehensive income, the consolidated statement of changes in equity and
the consolidated statement of cash flows for the year then ended, and notes to the financial report,
including material accounting policy information, the consolidated entity disclosure statement 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 2024 and of its
financial performance for the year ended on that date; and
(ii)
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
For personal use only
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd
ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a
UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme
approved under Professional Standards Legislation.
71
Revenue Recognition
Key audit matter
How the matter was addressed in our audit
The Group generates revenue from multiple streams,
including: software sales (perpetual and SaaS),
maintenance, advisory and consultancy.
The Group continued to increase its software sales
from recurring subscription sales. Revenue recognition
under AASB 15 Revenue from Contracts with
Customers is complex and subject to error, especially
where revenue is recognised over time or with
multiple performance obligations.
The Group’s disclosures about revenue recognition are
included in Note 1(f), which detail the accounting
policies applied under the requirements of AASB 15
Revenue from Contracts with Customers.
The assessment of the Group’s revenue recognition
was significant to our audit due to the materiality of
revenue to the financial report, and the complex
nature of accounting for the appropriate timing of
revenue related to the sale of software and related
maintenance services under the requirements of AASB
15 Revenue from Contracts with Customers.
The Group has entered into a number of material
contracts, requiring the Group to supply software
licence, maintenance services and other integration
services, a number of which included comprehensive
performance obligations. The total value of these
contracts are considered material to the Group.
Our procedures included, amongst others:
•
Assessing the revenue recognition policy for
compliance with AASB 15 Revenue from Contracts
with Customers, including engaging our internal
IFRS specialists to review the Group’s accounting
treatment of certain material contracts entered
into during the period and reviewing the
independent accounting advice commissioned by
management.
•
Selecting significant software licence contracts,
and reconciling the contract from inception to
reporting, alongside the revenue recognition under
AASB 15. This included a focus on new subscription
sales and the recognition of revenue ‘over time’.
•
Selecting a sample of licence sales, maintenance
services and consulting fees recognised as revenue,
and agreeing to supporting invoices, signed
customer contracts and proof of delivery.
•
When services have not been performed and cash a
has been received upfront, ensuring these have
been correctly included in contract liabilities.
•
Assessing the adequacy of the Group’s revenue
recognition disclosures within the financial
statements.
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BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd
ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a
UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme
approved under Professional Standards Legislation.
72
Valuation and disclosures of non-financial assets including goodwill and indefinite life intangibles
Key audit matter
How the matter was addressed in our audit
The Group’s disclosures on Goodwill
impairment are included in Note 10,
detailing the allocation of Goodwill to
the Group’s various cash-generating
units (‘CGUs’), setting out the key
assumptions for value-in-use calculations
and the impact possible changes in these
assumptions would have.
This annual impairment test is
significant to our audit given the
material balance of Goodwill as at 30
June 2024, and its importance to the
financial statements.
The impact of inputs used in
management’s assessment required
significant auditor attention.
Our procedures included, amongst others:
•
Evaluating management’s determination of the Group’s Cash
Generating Units (“CGUs”) to ensure they are appropriate,
including being at a level no higher than the operating segments
of the Group.
•
Evaluating management’s process regarding the valuation of
Group’s goodwill and other intangible assets
•
Assessing the Group’s assumptions and estimates relating to
forecast revenue, costs, discount rates and growth rates
•
Involving our internal specialists to assess the discount rate
against comparable market information
•
Assessing the disclosures related to the impairment assessment
by comparing these disclosures to our understanding of the
matter and the applicable accounting standards
•
Challenging key assumptions by performing sensitivity analysis on
the growth rates and discount rate assumptions used.
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2024, but does not include the
financial report and the 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 of the Company are responsible for the preparation of:
a)
the financial report that gives a true and fair view in accordance with Australian Accounting
Standards and the Corporations Act 2001 and
b)
the consolidated entity disclosure statement that is true and correct in accordance with the
Corporations Act 2001, and for such internal control as the directors determine is necessary to
enable the preparation of:
i)
the financial report that gives a true and fair view and is free from material misstatement,
whether due to fraud or error; and
ii)
the consolidated entity disclosure statement that is true and correct and is free of misstatement,
whether due to fraud or error.
For personal use only
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO Australia Ltd
ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a
UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme
approved under Professional Standards Legislation.
73
In preparing the financial report, the directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 14 to 21 of the directors’ report for the
year ended 30 June 2024.
In our opinion, the Remuneration Report of RPMGlobal Holdings Limited, for the year ended 30 June
2024, complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
BDO Audit Pty Ltd
C K Henry
Director
Brisbane, 26 August 2024
For personal use only
CORPORATE GOVERNANCE STATEMENT
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |74
Corporate Governance Statement – Year Ended 30 June 2024
The Board and Management of RPMGlobal Holdings Limited (ASX:RUL) (the ‘Company’) consider that it is crucial
to the Company’s long term performance and sustainability and to protect and enhance the interests of the
Company’s shareholders and other stakeholders, that it maintains an appropriate corporate governance
framework pursuant to which the Company and its related companies globally (the ‘Group’) will conduct its
operations in Australia and internationally with integrity, accountability and in a transparent and open manner.
The Company regularly reviews its governance arrangements as well as developments in market practice,
expectations, and regulation. The Company’s Corporate Governance Statement, which is available to view at
https://rpmglobal.com/wp-content/uploads/2024/08/20240823-CG_PY_00_Corporate-Governance-Statement-
FY24-25-Final.pdf, has been approved by the Board of RPMGlobal Holdings Limited and explains how the Group
addresses the requirements of the Corporations Act 2001, the ASX Listing Rules 2001 and the 4th Edition of the
ASX Principles and Recommendations (the ‘ASX Principles and Recommendations’) and is current as at 26 August
2024.
The
Company’s
ASX Appendix
4G,
which
is
available
to
view at
https://rpmglobal.com/wp-
content/uploads/2024/08/20240806-RPM-FY24-25-Appendix-4g-4th-Edition-RUL.pdf is a checklist cross-
referencing the ASX Principles and Recommendations to the relevant disclosures in the Company’s Corporate
Governance Statement, this 2024 Annual Report and other relevance governance documents and materials on
the Company’s website, which are provided in the Corporate Governance section of the Company’s website at
https://rpmglobal.com/company/investor-centre/. The Corporate Governance Statement together with the ASX
Appendix 4G and the Company’s 2024 Annual Report, were also lodged with the ASX on 26 August 2024.
The Board of the Company strives to meet the highest standards of Corporate Governance and also recognises
that it is also crucial that the Company’s governance framework appropriately reflects the current size, operations
and industry in which the Company operates.
The Company has complied with the recommendations of the ASX Principles and Recommendations. The Board
believes that any areas of minor non-conformance, which are explained in the Corporate Governance Statement
and the ASX Appendix 4G, do not materially impact on the Company’s ability to achieve the highest standards of
Corporate Governance, whilst at the same time ensuring the Company is able to achieve the expectations of its
shareholders and other stakeholders.
For personal use only
SHAREHOLDER INFORMATION
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |75
The shareholder information set out below was applicable as at 15 August 2024.
A.
Distribution of Equity Securities
Analysis of number of equity security holders by size of holding:
No. Holders
Options
1 – 1,000
3,738
-
1,001 – 5,000
3,987
10
5,001 – 10,000
1,256
26
10,001 – 100,000
1,297
89
100,001 – and over
145
14
10,423
139
The number of shareholdings held in less than marketable parcels of 203 shares is 272 (Close Price 15
August 2024 $2.47).
B.
Equity Security Holders
The names of the twenty largest holders of quoted equity securities (as at 15 August 2024) are listed below:
Name
Number held
Percentage
of issued
shares
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
33,133,574
14.99
CITICORP NOMINEES PTY LIMITED
28,946,388
13.09
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
27,201,283
12.30
RUNGE INTERNATIONAL PTY LTD
8,052,131
3.64
BNP PARIBAS NOMINEES PTY LTD
7,044,340
3.19
PAUA PTY LTD
6,734,608
3.05
UBS NOMINEES PTY LTD
4,761,132
2.15
MR STEPHEN JOHN BALDWIN + MRS ANDREA MAREE BALDWIN
2,642,511
1.20
NATIONAL NOMINEES LIMITED
2,543,602
1.15
TODD GLOBAL INVESTMENTS PTY LTD
2,360,676
1.07
NEWECONOMY COM AU NOMINEES PTY LIMITED <900 ACCOUNT>
1,688,386
0.76
ABN AMRO CLEARING SYDNEY NOMINEES PTY LTD
1,661,234
0.75
THE RIDGE NZ PTY LTD
1,485,530
0.67
BRETTON PTY LTD
1,200,000
0.54
BNP PARIBAS NOMS PTY LTD
1,021,325
0.46
BOND STREET CUSTODIANS LIMITED
997,077
0.45
MR IAN JAMES LUXTON
941,934
0.43
CERTANE CT PTY LTD
857,811
0.39
MR ALUN GWYN PHILLIPS + MRS ANDRE JOAN PHILLIPS
857,500
0.39
CRX INVESTMENTS PTY LIMITED
800,000
0.36
134,931,042
61.03
Unquoted equity securities
5,288,540 options over unissued shares (as at the date of this report): for further details see note 22.
For personal use only
SHAREHOLDER INFORMATION
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |76
C.
Substantial Holders
The names of the substantial shareholders listed in the holding register as at 30 June 2024 are:
Estimated beneficial holdings as at 30 June 2024
Number held
Percentage
Long Path Partners
13,686,571
6.18%
Perennial Value Management
11,935,135
5.39%
D.
Voting Rights
Refer to note 14 for voting rights attached to ordinary shares.
For personal use only
CORPORATE DIRECTORY
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024 |77
Directors
Richard Mathews
Managing Director
Stephen Baldwin
Chairman
Non-executive Director
Angeleen Jenkins
Non-executive Director
Paul Scurrah
Non-executive Director
Ross Walker
Non-executive Director
Company Secretary
James O’Neill
Group General Counsel and Company Secretary
Registered Office
Level 14, 310 Ann Street
Brisbane QLD 4000
Ph:
+61 7 3100 7200
Fax:
+61 7 3100 7297
Web: www.rpmglobal.com
Auditor
BDO Audit Pty Ltd
Level 10, 12 Creek St
Brisbane QLD 4000
Share Registry
Computershare Investor Services Pty Limited
Level 1, 200 Mary Street
Brisbane QLD 4000
Stock Exchange Listing
The Company is listed on the Australian Securities
Exchange Limited (ASX: RUL)
RPMGlobal Holdings Limited
ABN 17 010 672 321
For personal use only
RPMGLOBAL HOLDINGS LIMITED // ANNUAL REPORT 2024
Level 14, 310 Ann St, Brisbane QLD 4000
P: +61 7 3100 7200 F: +61 7 3100 7297
www.rpmglobal.com
For personal use only