Australia’s
Number
One
Annual Report
2022
Contents
Our Strategy
Who We Are
Our Strategic Priorities and Performance Dashboard
Executive Letters
Letter from the Chairman
Letter from the Managing Director and Chief Executive Officer
Review of Segments
Group Performance –
Key Highlights and Summary of Financial Performance
Seven
The West
Risk Management, People and Sustainability
Risk Management, Environment and People
Sustainability
Governance
Board of Directors
Corporate Governance Overview
Directors’ Report
Reissued – Remuneration Report
Auditor’s Independence Declaration
Financial Statements
Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Investor Information
Shareholder Information
Company Information
2
4
6
8
11
16
22
24
30
36
39
46
50
71
72
124
125
131
132
134
The Voice
1
Our strategy
Seven West Media Limited Annual Report 2022
Your #1
Your #1 for content, your #1 for audience powered by
technology: Seven West Media is the media company of
the future.
Seven West Media is Australia’s #1 content
company. It is home to the country’s largest and
#1 total television network, the #1 Broadcast Video
on Demand (BVOD) service and the fastest-growing
news, print and digital brand in the country.
As your #1 for premium news, sport, drama and
entertainment, we deliver creative and high-quality
content for audiences across all of Australia. We
spend every day connecting millions of people
to the moments that move the nation and deliver
Australia’s most powerful audience data insights.
Our wide variety of content across television,
newspapers and digital platforms plays a critical
role in society. It inspires, informs and entertains
Australia while providing trusted, impartial local and
national news that is freely available and critical to
the health of our democracy.
Our people are at the heart of what we do, working
with pride and passion to make content that not only
reflects but shapes our culture.
Seven West Media continues to digitally transform,
accelerate our streaming business and invest in the
best content, laying the foundations to continue our
dominant market position and continue as your #1
well into the future.
Broadcast
Digital
Other
2
3
Our Strategic Priorities and
Performance Dashboard
We are growing. We are transforming. We are stronger.
Seven West Media has an unrivalled ability to deliver the
biggest national audience across all demographics for our
commercial partners.
Over the past year, we have demonstrated continuing success against the following
strategic priorities:
Content Led Growth
Transformation
> Revitalise our entertainment
programming, creating momentum
to engage heartland Australia
> Sharpen our focus on being
an audience and sales-led
organisation
> Be the most relevant and exciting
offer to advertisers
> Explore a meaningful subscription
partnership play
> Redefine our working practices,
becoming more efficient and
effective
> Explore traditional and
non-traditional adjacencies
Capital Structure
and M&A
> Maintain focus to work down
debt and improve balance
sheet flexibility
> Explore M&A opportunities
Milestones Achieved
> #1 National Audience share
across all key demographics
> Seven has grown share in prime
time audiences across total
people, 25 to 54s and 16 to 39s
driven by the success of the
refreshed entertainment schedule
> Ongoing discussions with
content partners for streaming
opportunities
Milestones Achieved
> Completing first phase of
investment in a dynamic trading
platform, second phase underway
> Digital earnings now greater than
40 per cent of Group earnings
driven by BVOD
> 7REDiQ data proposition with
registered user growing 107 per
cent to 12.5 million registered,
verified users and new commercial
partnerships
> Seven West Ventures rebuild
commenced with 5 new investments
made driving the period
Milestones Achieved
> Balance sheet flexibility
significantly improved
> Net debt at $256 million and
leverage ratio at 0.7x
> Completed the acquisition of
Prime Media Group and integration
tracking ahead of plan
4
Our strategy Seven West Media Limited Annual Report 2022 Your #1 for growth, we have
outperformed the market and delivered
increased revenue and earnings
as well as significant progress in
rebalancing the business with digital
earnings, representing greater
than 40 per cent of group earnings.
In the 2021 calendar year, Seven
returned to leadership as the most-
watched television network in Australia
and was the only network to increase
its audience shares in total people,
25 to 54s, 16 to 39s and under 50s.
Seven delivered more #1 results than
any other network in calendar year
2021, with the most watched shows in
Australia and the most watched BVOD
service with 7plus. Seven maintained
its momentum in the first half of the
calendar year 2022, leading the year as
the #1 national network in total people,
25 to 54s and 16 to 39s.
West Australian Newspapers (WAN)
has focused on its strategy to hold
the line on print, turbo charge digital
growth and reduce costs. The successful
execution of this strategy has delivered
the highest level of EBIT in over five
years. This year also marked the first full
year contribution from the Google and
Facebook news platform agreements.
Having successfully executed our
strategy over the past three years –
through content-led growth, digital
transformation, the acquisition of the
assets of Prime Media Group and a
strengthened balance sheet – Seven
West Media continues to make
significant progress in growing
and strengthening our business.
We are maximising our unrivalled
scale, reach and national brand to
increase the audience and revenue
share from our broadcast, digital
and print businesses.
Strategic Outlook
As outlined, the company has successfully executed on its three year strategy which commenced in August 2019.
Management has since developed the next phase of the strategy to position Seven West Media for the future and
reflect our journey of digital transformation.
The strategic vision for Seven West Media and the initiatives to get there are outlined below.
What do we want to
be (3–5 years)
How do we get there
Diversified Leader
1. Diversified media
company
2. Audience led and
digital first; powered
by data and
technology
3. Total audience
monetisation with
material non-
advertising revenue
4. Low gearing
with capacity for
growth and capital
management
5. Re-weighting of
portfolio to increase
allocation to growth
Being Unmissable &
Easy to Access
> Target 40%+ share of ratings and revenue
in the Total TV market by FY24
Win on every screen in all genres
of news, sport and entertainment
across all key demographics
> Accelerate the digital transformation with
7plus to improve the user experience and
grow consumption
Deepening audience relationships
with a greater allocation to digital
> Establish deeper audience relationships
through curated content experiences to drive
greater monetisation opportunity
> Regulatory engagement for prominence
and free access for all Australians
Growing through
technology and scale
> Deliver benefits of Prime Media Group
acquisition
Driving scale, efficiencies,
capability and defensibility
> Invest in systems to improve/simplify trading
capability and increase revenue
M&A with non-media companies,
leverage scale to drive total
audience monetisation
> Pursue value accretive M&A
> Scale digital ventures
Driving Value
Empowering everyone to
think and act like an owner;
constantly questioning...
is there a better way?
> Allocate resources and capital and ensure
ongoing cost management to maximise return
on investment
> Maintain economic discipline while securing
leading content for broadcast and digital
> Hold the line on print earnings while turbo
charging digital growth
> Explore value accretive capital
management options
5
Letter from
the Chairman
Seven West Media continued to lead the media sector during
the last financial year and we are well positioned to grow
further in 2023 as the economy emerges from the pandemic.
In addition to being Australia’s
most watched TV network, our BVOD
platform 7plus now has more than 12.5
million registered, verified users and
our newspaper business in Western
Australia reaches 82 per cent of the
state’s population.
Our expansion to be a complete
free-to-air broadcast and digital
platform reached another milestone
during the year, with digital well on the
way to generating 50 per cent of our
earnings over the next couple of years.
Our audience is watching TV and
video in greater numbers than ever
before, with double-digit growth
over the last year in our BVOD viewing,
75 per cent of this audience being
under 55 years of age.
The attraction of video on demand was
heightened with continued lockdowns,
the very successful Tokyo and Beijing
Olympics, and a deep and growing
catalogue of “classic” TV shows.
We are no longer a traditional media
group but a fully-fledged digital
platform with a variety of channels
to broadcast our own, unique content
that can be accessed any time of the
day on a wide range of devices.
As a result, we are attracting a range
of new advertisers that are using both
traditional broadcast and digital to
reach specific audiences, who we can
now identify and address better than
ever before through technology.
We are encouraging the Federal
Government to legislate the prominence
and free carriage of our digital services
on every device in the market, while
continuing to protect the industry’s
anti-siphoning rules and sports rights
on free-to-air television.
Our partnerships with Google and
Facebook support Seven West Media
investing in new and growing income
streams for our group.
Meanwhile, our prudent management of
capital, debt and costs has not stopped
us investing further in our digital
offerings and also the acquisition of the
assets of Prime Media Group, which
has given us direct access to Australia’s
largest regional audience and made
Seven the undisputed national total
television market leader.
This expansion of our regional
coverage area with Prime has been
highlighted with the strong advertiser
response to the highly successful 2022
Commonwealth Games and continued
success of the AFL.
Our general entertainment programs,
including The Voice and Home and
Away, continue to perform well, while
our news and public affairs programs
again dominated the ratings during
the year.
Our print operations, with 32 titles
across city and regional areas in
Western Australia, further dominate
the market, with the expansion of
The West’s digital assets attracting
a younger audience.
“ Our Group’s strategy to focus on content-led growth
and market-leading digital assets will play a major role
in adapting to the ever-changing viewing and reading
habits of people across all demographics.”
6
Executive Letters Seven West Media Limited Annual Report 2022 Our Group’s strategy to focus on
content-led growth and market-leading
digital assets will play a major role in
adapting to the ever-changing viewing
and reading habits of people across all
demographics.
This growth will be balanced by an
ongoing concentration on continuous
improvement and gaining further
operational efficiencies, as well as
capital management initiatives.
The first capital management initiative,
a 10 per cent on-market share buyback,
will commence in August 2022. The Board
will continue to review the mix of capital
management initiatives through FY23.
On behalf of the Board, I thank you,
our shareholders, and our staff for your
ongoing support of Seven West Media
as we chart an exciting new course in
Australia’s media sector.
Kerry Stokes AC
Chairman
7
Letter from the
Managing Director and
Chief Executive Officer
The past year has seen Seven West Media emerge as one of the best
performing and fastest growing companies in the Australian media
sector, and we are well placed to continue that growth and build on
our leadership position.
The diligent execution of our strategy
over the past three years, the acquisition
of the assets of Prime Media Group on 31
December 2021 and the strong growth
of 7plus – coupled with the outstanding
success of Seven’s television broadcast
business – have made our company the
undisputed market leader in the national
total television market, that is, across
capital city and regional broadcast
and BVOD television.
The ”Your #1” tagline you see in this
year’s annual report is important. Seven
is Australia’s #1 total television company,
reaching more people nationally and in
the capital cities every single day than
any of our competitors.
Seven is Australia’s #1 choice for news,
sport, drama and entertainment content.
7plus is #1 in the booming BVOD market.
For advertisers, Seven is their #1 choice
to reach and engage with their existing
and potential customers.
Now that we are back at #1, we are
totally focused on increasing our
leadership and ensuring that position
translates into increased revenue,
earnings and shareholder returns.
The financial results for 2021-22
clearly demonstrate the dramatic
transformation our company has
been through since late 2019.
The strong revenue and earnings growth
we reported for the year reflected the
success of our content-led growth
strategy and the digital transformation
of the company. Our digital businesses,
including 7plus, accounted for more
than 40 per cent of earnings, compared
with just 2 per cent four years ago.
That one fact alone speaks volumes
about how our company has changed
and how it has been restructured and
reorientated for the future.
Broadcast
In the 2021 calendar year we returned
to #1 in TV for the first time in three
years, while 7plus was #1 in BVOD
for the second year in a row.
We have retained both those titles
in 2022. Seven is the most-watched
television network nationally and in the
capital cities, and we have achieved
strong growth in the key advertiser
demographics of people aged 25 to 54
and 16 to 39.
From a television content point of
view, we started 2022 in a much better
position than we have in recent years.
Our focus this calendar year is to be
more consistent in our entertainment
schedule and to win. The results speak
for themselves: so far this calendar year
we have had our most competitive start
to a ratings survey year since 2018.
That result has been driven by the
ongoing success of our dominant content
“spine” – 7NEWS, Sunrise, The Chase
Australia, Home and Away, Better
Homes and Gardens and The Morning
Show – key tentpole programs such as
The Voice, Dancing With The Stars: All
Stars, Big Brother and SAS Australia,
and key sports including the AFL,
Olympic Games Tokyo 2020, Paralympic
Games Tokyo 2020, Olympic Winter
Games Beijing 2022 and Paralympic
Winter Games Beijing 2022.
Our content line-up for the new
financial year is deep and strong.
In addition to many returning hit
programs across all genres, we have
just had the highly successful 2022
Commonwealth Games on Seven and
7plus. The refreshed MKR is on air now
and our forward content slate includes
AGT, Farmer Wants A Wife, Kitchen
Nightmares, This Is Your Life, Australian
Idol, Million Dollar Island and other new
shows we are yet to announce.
“ Seven is Australia’s #1 choice for news, sport, drama and
entertainment content. 7plus is #1 in the booming BVOD
market. For advertisers, Seven is their #1 choice to reach
and engage with their existing and potential customers.”
8
Executive Letters Seven West Media Limited Annual Report 2022 Seven’s broadcast content, of course,
is a key reason for success on 7plus, but
it is far more than a catchup TV service.
More than 50 per cent of the content on
7plus is exclusive to the platform, making
it a genuine streaming destination. What
that tells us is that while big noisy shows
such as The Voice, Home and Away
and Big Brother initially draw people to
7plus, the depth and breadth of content
on the platform keeps them there and
creates user loyalty and “stickiness”.
We have big plans this year to increase
the audience and usage of 7plus.
The 12.5 million verified, registered
users of 7plus are an incredibly powerful
marketing platform. When big data is
overlayed – in our case, six billion
data points – marketers have a
remarkable addressable medium
which delivers quality video with
big data, all in a brand-safe
environment.
The success of our content is driving
results in terms of our share of the
television advertising market.
Our 40.3 per cent metropolitan revenue
share in the first half of the 2021-22
financial year was our highest revenue
share since the December 2016 half.
Across the 2021-22 year, our share of
the total television advertising market
was 39.1 per cent. That included the
BVOD market, where we secured a
39.4 per cent share, and the regional
television market, where we achieved a
43.3 per cent share. Seven’s share grew
more than 2.5 percentage points across
the year.
Digital
These days, television as many people
know it – the thing hanging on the wall
where you change channels with a
remote control – is not television at all.
That set on the wall is just a part, albeit
an important part, of a video ecosystem
we call total television. That total
television market is much bigger than
you think. It’s growing, it’s digital, it’s
mobile and we are tapping into those
growth markets at a rapid pace.
Our 7plus platform has been a
key focus in recent years – and a
remarkable success. It is now the #1
BVOD platform in Australia in terms of
its share of viewing and it has more than
12.5 million registered, verified users.
9
The West
The West continues to perform well,
driven by management’s ongoing
execution of a strategy to hold the
line on print earnings, reduce costs
and turbo charge the digital and
subscription side of the business.
As a result, The West is one of the
strongest news brands in Australia, with
impressive results across both digital
and print. Digital subscriptions and
audiences are showing great growth.
According to Roy Morgan data, The
West was the fastest-growing news
print and digital brand in Australia
during the 12 months to March 2022.
It increased its audience 19.4 per cent
to 4.6 million across the weekday
newspaper, Saturday’s The West
Australian, The Sunday Times and
the websites thewest.com.au and
PerthNow.com.au
One in six West Australians consumes the
newspaper, which is the highest market
penetration of any brand in the country.
On a cross-platform basis that accounts
for the newspapers and websites, 82 per
cent of the state reads The West. Again,
that is the highest market penetration of
any news brand in any state.
Capital structure and M&A
The cost efficiency program we started
in 2019 continues, with the simple
premise that every dollar we spend must
generate a return. We will continue to
invest in revenue-generating content
and continue to ensure that everything
we do makes sense financially.
The combination of our two Sydney
operations in a refurbished centre in
Eveleigh is progressing very well and is
on track for completion in early 2023.
The improvement in our balance sheet in
recent years has enabled the expansion
of Seven West Ventures and, more
importantly, the acquisition of the
assets of Prime Media Group was able
to be debt funded during 2021-22.
Our balance sheet is in very good shape,
with drawn debt at its lowest level for
many years. This balance sheet strength
means our company is well placed to
head into a period of uncertainty and
provides flexibility to respond to the
challenges and opportunities that
are presented during this period.
It’s great to have Prime and its people as
part of Seven West Media and the union
of these two market-leading businesses
has created an unrivalled opportunity
for us to increase our share of the $2.8
billion national total TV ad market. We
are already seeing clear commercial
benefits in being able to easily sell
combined national/metropolitan
advertising packages to marketers.
The acquisition of the assets of Prime
Media Group has also created a
significant opportunity to build a bigger
presence for 7plus and 7NEWS.com.au
in regional markets. We have started
new marketing of 7plus in regional
areas, which is already generating
new users, increasing consumption
and driving new revenue.
We continue to explore the
establishment of a meaningful
streaming partnership. This is not
about any opportunity, rather the right
opportunity, and we will be patient
to ensure we get the right result in an
extremely crowded market.
As flagged at the February 2022
interim results, the board has assessed
options regarding capital management
during the second half. The significant
improvement in our balance sheet
over the last two years has enabled
us to announce a share buyback, to
commence following the FY22 result.
The on-market buyback will be for up
to 10 per cent of issued capital and will
be highly earnings accretive for Seven
West Media shareholders.
Outlook
Our FY23 first quarter ad bookings are
skewed due to the impact of Olympic
Games Tokyo 2022 last year, but we
estimate the overall total TV market is
back 2 per cent, excluding the Olympics
and 7 per cent if you were to include it.
Visibility into the second quarter is
improving, which we believe may be
due to the tight inventory market last
year and advertisers seeking to secure
placement. While still early, current total
TV forward bookings for the second
quarter are positive year on year.
These total TV estimates include
BVOD which we expect to maintain
robust growth.
Seven Digital is on track for another
year of strong revenue and earnings
growth, and this will include consistent
revenue contribution from the digital
platform news revenue as in the 2022
financial year.
Our FY23 group operating costs will be in
the range of $1.2 billion to $1.22 billion.
We will provide a further update on the
market at our AGM in November this year.
Our people
Investing in our people has been a key
focus over the past three years, with the
introduction of a range of new initiatives
to help our people learn and grow.
In March this year, Seven West Media
became the first media company in
Australia to be awarded the Workplace
Gender Equality Agency’s (WGEA)
Employer of Choice for Gender Equality
citation.
The criterion for the citation is
rigorous and we were one of just 12
new companies to receive the highly
regarded citation this year, recognising
Seven West Media as an employer
committed to achieving gender equality
in the workplace.
Our company has changed a lot in
recent years. 48 per cent of all our
staff are women and 50 per cent of
our management roles are held by
women. The WGEA citation builds on
our continued responsibility to promote
diversity, equality and inclusion across
Seven but there is still much more work
to do as we build the media company
of the future.
Let me finish by thanking all our
shareholders and staff for your support
and belief in our business. The Board
and the executive leadership team
sincerely appreciate the hard work,
enthusiasm and talent of all our staff in
all parts of Seven West Media. Without
them, Seven would not be Australia’s
#1. Thank you and I’m looking forward
to working with all of you in the year
ahead to make our company even
more successful.
Our ratings performance is expected
to drive a TV ad revenue share of 39 per
cent in FY23.
James Warburton
Managing Director and
Chief Executive Officer
10
Executive Letters Seven West Media Limited Annual Report 2022 Group Performance
Key Highlights
Olympic Games Tokyo 2020 broadcasts reach
20.2 million Australians
Seven is the only network to
grow commercial
audience share in FY22
7plus registered users exceed
12.5 million, 107% growth yoy
Debt facilities
successfully
refinanced
with significant improvement
in terms
Net debt at
$256m
Leverage
0.7x
at year
end
11
Summary of Financial Performance
Revenue
Other income
Share of net profit of equity accounted investees
Revenue, other income and equity accounted profits
Operating expenses excluding depreciation and amortisation
EBITDA1
Depreciation and amortisation
EBIT2
Net finance costs
Profit before significant items and tax
Significant items excluding tax
Profit before tax
Tax expense
Profit after tax
Less significant items including tax
Profit after tax excluding significant items
EBITDA margin
Basic EPS
Basic EPS excluding significant items net of tax
Diluted EPS
Diluted EPS excluding significant items net of tax
FY22
$’000
FY21
$’000
Change3,4
%
21%
nm
nm
21%
17%
35%
34%
35%
(42%)
62%
nm
(36%)
(43%)
(34%)
nm
60%
1,538,537
1,269,609
1,092
318
1,539,947
(1,197,757)
342,190
(33,197)
308,993
(35,456)
273,537
9,854
283,391
(72,339)
211,052
10,293
200,759
22.2%
13.3 cents
12.7 cents
13.0 cents
12.4 cents
37
6,322
1,275,968
(1,022,077)
253,891
(24,783)
229,108
(60,674)
168,434
277,187
445,621
(127,499)
318,122
192,577
125,545
20.0%
20.7 cents
8.2 cents
20.7 cents
8.2 cents
EBITDA relates to profit before significant items, net finance costs, tax, depreciation and amortisation
EBIT relates to profit before significant items, net finance costs and tax
1
2
3 Changes in percentages are calculated on whole dollars and not the rounded amounts presented
4
“nm” means “not meaningful”
Reconciliation of EBIT to statutory profit before tax
EBIT
Net finance costs
Significant items excluding tax
Profit before tax from continuing operations
FY22
$m
308,993
(35,456)
9,854
283,391
FY214
$m
229,108
(60,674)
277,187
445,621
Change
%
35%
(42%)
nm
(36%)
12
Review of Segments Seven West Media Limited Annual Report 2022
Seven West Media Limited reported a statutory profit from continuing operations
before tax of $283.4 million for the year ended 25 June 2022. This compares
to a corresponding year statutory profit of $445.6 million. Excluding significant
items, the current year profit after tax of $200.8 million is up 60.0 per cent
on the previous year equivalent profit of $125.5 million.
Seven West Media recorded significant
item benefits before tax of $9.9
million in the period, relating to net
income received in the Prime Media
Group acquisition, disposal of GSTV,
reversal of onerous contracts, fair value
adjustments and write off of previously
capitalised borrowing costs as a result
of the debt refinancing. The prior year
significant item benefits before tax of
$277.2 million included the reversal of
prior period impairment of intangibles,
reversal of onerous contracts and
restructuring provisions recognised in
prior periods, and costs associated
with the disposal of other assets.
The Prime Media Group acquisition,
completed in December 2021,
contributed EBITDA of $10.8 million in
the second half before synergies. The
Prime Media Group business integration
is well progressed and the scale and
reach benefits from this acquisition
have positively impacted the 2022
financial year results. This increase
is set to continue throughout the 2023
financial year.
Profit before significant items,
net finance costs and tax (EBIT) of
$309.0 million was up 35 per cent
on the previous year.
The Group delivered revenue including
share of equity accounted investees
profits of $1.5 billion, up 21 per cent
versus the previous year. This included
Prime Media Group contribution of
$43.8 million.
Total Group costs, including
depreciation and amortisation,
increased $182.1 million representing
a 18 per cent increase year on year.
Group costs increased during the year
due to the investment in programming
and broadcast of two Olympic Games,
acquisition of Prime Media Group, as
well as impact from the high inflationary
environment impacting suppliers and
salary costs.
The FY22 performance and improved
balance sheet has enabled the Group
to resume capital management
initiatives for the first time in 5 years.
New ventures
Seven West Ventures has expanded
during the financial year with the
investment in five new growth
investments. These ventures are
opportunities where we leverage the
power of our assets to unlock maximum
growth potential and drive long-term
value creation. The portfolio is focused
on disruptive, scalable businesses with
a strong consumer or media proposition.
Sevens Paralympic Games Tokyo 2020 commentary team
Emma Vosti, Kurt Fearnley, Annabelle Williams and Matt White
13
Review of Segments
Seven West Media Limited Annual Report 2022
Under the terms of the agreement,
the previous minimum liquidity
requirements and EBITDA test were
replaced by a total leverage ratio and
a total interest cover ratio test. The
Group has been in compliance with its
financial covenants to date, including
the period ended 25 June 2022.
SAS Australia – Dean Stott, Ollie Ollerton, Ant Middleton and Clint Emerson
Cashflow
Balance Sheet
Cashflow continues to be roboust
with net operating cash inflows of
$160.2 million, up $17.0 million on
the prior year. Working capital
during the year was impacted by
the programming line up including
the Olympic Games Tokyo 2020 and
Olympic Winter Games Beijing 2022.
Net cash outflows from other
activities of $375.6 million include
net debt repayments, payments for
own shares, payments for capital
expenditure, leases and other
investment opportunities. As
a result, the net cash outflow
for the year was $215.4 million.
The above include net cash outflows
of $85.6 million relating to the Prime
Media Group acquisition made during
the year, with the acquisition price
adjusted for cash acquired, special
dividend and capital returns received
from the Group’s equity interest in the
previous Prime Media Group parent
company, PRT Company Limited.
As at 25 June 2022, the Group’s assets
exceeded its liabilities by $263.7 million
(26 June 2021: $84.3 million). The
Group has positive net current assets
as at 25 June 2022 of $18.4 million
(26 June 2021: $148.3 million).
Net Debt
As at 25 June 2022, the Group held
net debt of $256.5 million (including
borrowing costs), compared to
$240.0 million in the prior period.
In October 2021, the Group refinanced
its existing debt facility. A $600
million secured revolving syndicated
facility agreement was entered into
which matures in October 2024. The
new facility funding costs are at 2.25
per cent above BBSY, which is half
the funding costs under the previous
facility. As the new facility is revolving,
less cash will be required to be held on
the balance sheet which has also helped
reduce interest costs.
14
The Voice
The Seven West Ventures
portfolio is focused on
disruptive, scalable
businesses with a strong
consumer or media
proposition.
15
Review of Segments
Seven West Media Limited Annual Report 2022
Review of Segments
Seven
Dancing With The Stars
16
Seven is Australia’s #1 total television company.
The content and transformation strategy
accelerated throughout the financial
year, with key tentpoles continuing
to deliver audience consistency and
strength. This programming line-up,
coupled with acquisition of the assets
of Prime Media Group, has resulted
in Seven being the #1 network and
7plus the #1 BVOD service.
Seven’s strategy continues to focus
on acquiring, engaging and retaining
advertising friendly demographics.
Our aim is to bring viewers the best
entertainment, news and sport content
to engage these audiences at scale.
The evolving entertainment schedule
continues to enrich the demographic
profile of the network and enhance
our proposition for advertisers.
The acquisition of the assets of Prime
Media Group in December 2021 has
also strengthened our proposition
to advertisers. We are pursuing the
opportunity created by Prime to increase
our presence in regional markets,
especially through the 7plus platform.
Our linear broadcast now reaches more
than 91 per cent of Australians, allowing
us the opportunity to increase our share
of the $3.8 billion national total TV and
advertising market.
ThinkTV reported that the metropolitan
free to air television advertising market
increased by 8.75 per cent to $2.8 billion
in the financial year. While COVID-19
continued to affect the first quarter of the
financial year, the timing and magnitude
of the market recovery experienced
during the remainder of the year was
ahead of expectations. This recovery
has been sustained despite lockdowns
and border closures that intermittently
impacting key metropolitan markets
through the first half of FY22.
7REDiQ continues to enhance our
digital audience targeting capabilities,
unifying data analytics into tangible
insights across the Group. This market
leading Audience Intelligence tool
supports the growth in the overall
BVOD market as well as Seven’s share
of that market. The 7REDiQ platform
has enabled data overlay on direct
bookings to increase by 75 per cent
and programmatic activity to grow from
zero to 25 per cent with transactions
across all addressable targeted
segments in 2022.
Seven Network
Seven was the #1 television network
for the calendar year 2021 and has
maintained this position in the first half
of the calendar year 2022. Seven is the
only network to grow audience share,
which is testament to the changes
made to the programming strategy
and the proposition being offered
to advertisers. This has only been
strengthened by the acquisition
of the assets of Prime Media Group.
The revitalised entertainment schedule
with successful new formats, combined
with our market-leading news and
sports franchises, has driven these
results. The ratings momentum we have
seen during the 2022 financial year with
our tentpole shows, content spine and
sport will be reflected in an improved
share of television advertising revenue.
The 2022 financial year commenced
with the Olympic Games Tokyo 2020
which was a landmark media event
reaching 20.2 million Australians
across broadcast and 7plus. More
than 4.7 billion minutes of content were
streamed on 7plus during the Olympics
period and 7plus registered users grew
to 10 million, which has continued to
grow post Olympics, with registered
users of 12.5 million at 25 June 2022.
Seven is the only network to grow audience share which
is testament to the changes made to the programming
strategy and the proposition being offered to advertisers.
17
The Olympic Games Tokyo 2020
provided the launch pad for the 2022
financial year content lineup that
included the year’s #1 new tentpole
The Voice, SAS Australia, and Big
Brother as well as the AFL Finals Series
(reaching 7.5 million viewers – biggest
grand final since 2016), Bathurst
1000, the Ashes Cricket Test Series,
and Olympic Winter Games Beijing
(reaching 14 million viewers across
broadcast and 7plus).
to be launched from this event will see
the refreshed MKR and AGT, the return
of Australian Idol and the introduction
of new format Million Dollar Island.
In addition, the depth of Seven’s
broadcast schedule remains
unparalleled. This consistency is led
by our market-leading news and public
affairs programming, long running Seven
productions (Home and Away and Better
Homes and Gardens), and Sport.
Similarly, the 2022–2023 financial
year will commence with the 2022
Birmingham Commonwealth Games
which will provide a strong platform to
launch programming. The programming
Seven’s programming schedule begins
each day with Sunrise, which remains
Australia’s most-watched breakfast
show for a 19th consecutive financial
year. The Morning Show celebrated
its 15th birthday as the most-watched
morning show. Home and Away
continues to be the #1 Australian
drama on free-to-air. Rounding out
Seven’s dominance throughout the day
is The Chase that provides the lead-
in to Seven’s market leading nightly
news service. 7NEWS continued its
dominance as the #1 news service in
the country. It remains the most trusted
source of broadcast news in the country
with our evening 6pm news bulletin
continuing to average over 1 million
capital city viewers viewers in 2022.
Seven is also home of Australia’s number
one sport in the AFL.
Dancing with the Stars - Grand Finalists
18
Review of Segments Seven West Media Limited Annual Report 2022 Seven’s revenue grew by 23.6 per cent
to $1.37 billion. Costs increased by
19.4 per cent to $1.04 billion, which
includes 6 months of costs acquired
as a part of the Prime transaction.
EBIT increased 39.8 per cent to
$295.8 million.
Seven
Revenue
Costs
EBITDA
EBIT
FY22
$m
1,367.9
(1,039.8)
328.0
295.8
FY21
$m
1,106.5
(870.9)
235.6
211.6
Inc/(Dec)
%
23.6
19.4
39.2
39.8
Seven was the #1 television network for the
calendar year 2021 and has maintained this
position in first half of calendar year 2022.
Home and Away
19
Review of Segments
Seven West Media Limited Annual Report 2022
Digital
20
Seven’s BVOD streaming platform 7plus increased share of total
minutes streamed in FY22 to 43.4 per cent, up 3.4 per cent year
on year.
In the 2022 financial year streaming
minutes on 7plus grew by 61.3 per cent,
comfortably outperforming commercial
FTA market streaming growth of 47.6
per cent. Seven’s major events and
tentpole programming supported the
continued growth in consumption on
7plus, building on the audiences that
the platform’s library content continues
to deliver.
Registered users on 7plus streaming
platform increased 107.0 per cent to
12.5 million year-on-year during FY22.
Investment in the 7plus platform on
web and mobile has delivered a best in
class user experience for the 9.2 million
viewers who streamed our coverage of
the Olympic Games Tokyo 2020 and for
the 1.8 million viewers who streamed
our coverage of the Olympic Winter
Games Beijing 2022.
The launch of audience measurement
system VOZ in July 2021 now allows
us to highlight the incremental reach
of BVOD.
During the 2022 financial year, the
BVOD market continues to grow rapidly,
with advertising revenues from online
catch-up and live TV streaming up 46.7
per cent YoY to $369.4 million. Seven
outperformed the market, growing its
digital gross advertising revenue by
56.3 per cent year-on-year.
Digital revenue included within the
Seven business increased by 93 per
cent during the financial year to
$177.1 million.
The rapidly growing scale of 7plus’
registered audiences, together with a
series of premium second-party data
sharing arrangements, continued to
grow the 7REDiQ platform. 7REDiQ
has enhanced our digital audience
targeting capabilities, unifying insights
and data analytics across the Group.
This data offering secures premium
revenue, supporting the growth in the
overall BVOD market as well as Seven’s
share of that market. The subscriber
growth experienced during the financial
year allows the REDiQ platform to
rapidly scale and improve our premium
advertising offering to advertisers.
7NEWS.com.au revenue grew 24.0
per cent year-on-year with total
page views (up 4.2 per cent) and
an increase in video consumption.
Seven’s major events and tentpole
programming supported the continued
growth in consumption on 7plus, building
on the audiences that the platform’s library
content continues to deliver.
21
Review of Segments
Seven West Media Limited Annual Report 2022
Review of Segments
The West
Dancing With The Stars
22
West Australian Newspapers is the fastest growing
cross-platform brand in Australia.
Publications include 2 metro
publications The West Australian
and The Sunday Times, 19 regional
publications, 11 suburban newspapers
and the state’s most popular websites
thewest.com.au and PerthNow.com.au.
The West Australian averages 359,000
print readers every day and 481,000
on the weekend. The Sunday Times has
an average of 366,000 readers every
weekend. Latest data from Roy Morgan
to March 2022 reveals that in the past
year these circulation numbers have risen
6 per cent for the daily newspaper and
18 per cent for the Saturday newspaper
on the back of award-winning journalism
and powerful newspaper presentations.
On a combined basis, thewest.com.au
and PerthNow.com.au have 3.5 million
unique monthly audience, reflecting
the engaging and quality content
across our digital platforms.
In print, The West Australian Monday
to Friday edition has the highest
market reach of any major metropolitan
weekday masthead in the nation,
with 16.4 per cent of West Australians
on average reading an issue of the
weekday edition. Average weekday
readership of The West Australian was
strong in the 12 months to March 2022,
outperforming the broader industry.
The West has continued to transform its
business with a strong focus on driving a
greater share of its revenue from digital
subscriptions and circulation, through
high quality local editorial. The result of
this focus is demonstrated in the leading
readership and circulation results across
the country, as well as the strong growth
in digital subscription revenue.
WAN, alongside Seven, continues to
benefit from the landmark commercial
agreement to provide Google and
Facebook news content, supporting
The West’s investment in high quality
journalism and content. Evidence of this
investment includes several new video
content series across YouTube (Google)
and The West publications including
‘Up late’ with Ben Harvey and the launch
of innovative new digital products across
our platforms.
Economic conditions continue to improve
in West Australia, although advertising
conditions have been mixed. Strong
retail trade and the federal election was
a positive contributor for advertising
spend, but certain sectors have been
faced with demand outstripping supply,
such as auto and real estate, which has
resulted in reduced advertising spend.
Total revenue increased by 4.4 per
cent to $169.3 million. Operating costs
are an ongoing focus and the West’s
costs increased 1.4 per cent in FY22.
There were no temporary savings in the
current year after more than $9 million
of temporary COVID-19 benefits in the
previous financial year.
WAN
Revenue
Costs
EBITDA
EBIT
FY22
$m
169.3
FY21
$m
162.2
(135.6)
(133.7)
33.7
33.2
28.5
28.2
Inc/(Dec)
%
4.4
1.4
18.2
17.7
23
Risk Management
and People
Risk Management
Seven West Media maintains sound
risk management systems in order
to protect and enhance shareholder
value. The Board acknowledges that
the management of business risk is
an integral part of the Company’s
operations and that a sound risk
management framework, aligned to
its strategy, not only helps to protect
established value, it can also assist
in identifying and capitalising on
opportunities to create value.
The table below sets out the key risks
(in no particular order) which could
impact achievement of the Company’s
strategic objectives. These risks are
actively monitored under our risk
management framework and there are
processes in place to identify, measure,
evaluate, monitor and report on each
of them and then control or mitigate
them, to the extent possible. For more
information on the Company’s risk
management framework refer to pages
39 to 45 of this Annual Report for the
Corporate Governance Statement.
Risk Management Framework – Key Risks and Mitigations
Strategic
Objective
Risk
Category
Content-led
Growth
Competition for key sports and
entertainment rights
The Company recognises the value of
premium content to its audiences and
advertisers and the importance of the
Company securing rights or creating
attractive content at a sustainable cost.
Structural change and new competitors
for audiences
The rapid transformation of the media
industry due to technological change
represents a material economic
sustainability risk for the Company.
Mitigations
The Company ensures a disciplined approach is
maintained in acquiring content rights and production
resourcing. For these rights acquired, the focus is on
maximising the revenue opportunities that these rights
present, including by targeting key demographics for
advertisers and demonstrating the return on advertising
investment through reliable measurement systems.
The Company continues to update arrangements to
acquire this premium content where possible, to reflect
the changing operating environment.
The Company is responding to and participating in this
change under its current strategic framework, including
a continued investment in the rapid digital transformation
of the Company.
The Company continues to target leadership in the most
valuable linear broadcast demographics which, together
with our 7plus BVOD service, allows for growth in audiences
and greater returns on our investments in content.
In addition, the Company’s data product 7REDiQ continues
to improve the outcomes for advertisers and viewers
through the delivery of better contextualised advertising.
24
Risk Management, People and Sustainability Seven West Media Limited Annual Report 2022 Risk Management Framework – Key Risks and Mitigations
Strategic
Objective
Risk
Category
Transformation Technological Risk
There is an ongoing risk that the Company’s
technology may not be fit for purpose or
that major technology projects may not
be delivered to plan, impacting business
performance or requiring new investment.
There is also the risk that key technology
may fail resulting in loss of revenue and
audiences.
Regulatory Change
The television industry is subject to a high
degree of regulation including broadcast
licence conditions. Changes to these
conditions can have a material impact on
the costs of operation and the ability of the
Company to compete in a global market.
Cyber Security Risk
Noting the increasing frequency and severity
of cyber security attacks globally, there is
a risk that the Company’s systems may be
subject to such an attack. The Company
recognises that such incidents, should they
occur, may negatively impact financial and
operational performance. This can include
the loss of Company and customer data.
COVID-19 Impacts on Workforce
The impact of COVID-19 has changed the
normal working conditions for all staff and
continues to contribute to absences and
productivity loss for team members.
Capital Funding Availability
There is a risk to the availability of the
capital funding required to meet the
Company’s operating and strategic
requirements. This risk arises due to
some or all of the following factors:
> the structural changes in the
media industry; and
> the success of the Company’s
content and audience strategies.
Execution of M&A strategy
There is a risk that the M&A activity that is
entered into does not realise the expected
benefits and strategic alignment to the
Group’s strategy when it was entered into.
Capital
Structure
and M&A
Mitigations
The Company has increased its technology capabilities
through enhanced staffing expertise, project delivery
governance and reporting processes to better manage
this risk.
The Company continues to manage risks which could give
rise to a failure in core operational systems and processes
through Business Continuity Planning including system and
site redundancy.
Management maintains a specialised expertise in regulatory
matters and participates in regulatory reviews through
direct engagement and via representation on a variety of
industry bodies. The Company continues to engage with
the Federal Government following the release of the Media
Reform Green Paper to participate in the creation of a new
regulatory framework for the future of the Australian free-to-
air television industry.
All Company staff receive ongoing training to ensure that
they are aware of the risks that cyber attacks pose and
their role in preventing incidents from occurring.
The Company also continues to grow its investment in
the technical staff and systems required to appropriately
manage the potential adverse effects on the Company.
The Company has a robust Incident Management
framework which has operated throughout the pandemic,
seeking to mitigate risks to the safety and wellbeing of all
staff regardless of where they are carrying out their duties.
The Company refinanced its debt facility in October 2021,
for a further three years. The terms of the refinanced facility
are a significant improvement to the previous facility
and provide the Company greater flexibility to pursue
its strategy.
This refinance significantly reduces the Company’s
exposure to this risk and better positions the business
moving forward.
The Company completed its acquisition of the assets of
Prime Media Group in December 2021 which expanded
our national reach and improved our total TV ad market
proposition to advertisers.
The Company ensures that M&A transactions that are
entered into meet stringent hurdles to achieve the best
possible outcome for our shareholders. Detailed integration
plans accompany any M&A transaction so that any
transaction is successfully integrated.
25
People
At Seven West Media, we understand that our people ensure our success. In return, we are committed to creating a workplace where
employees can fulfil their individual career aspirations and potential and that they are inspired by a high-performance culture.
Management works to promote a collaborative and innovative workplace that is safe, flexible, inclusive and that fosters
creativity and excellence. This ensures that the Company continues to meet the highest performance standards and serves
the evolving needs of our stakeholders, our customers and our audiences.
People Policies & Practices
We have a comprehensive set of frameworks that support our culture to build a high-performance workplace and drive our
focus on results, productivity and safety. Our purpose, strategy and values focus our efforts and determine how we measure
our success.
The intent of our people policies and practices is to create a workplace where employees are assured that:
> Minimum legal requirements are being met;
> Employees, as well as the Company are protected from
> Best practices appropriate to the Company can be
the pressures of expediency; and
documented and implemented;
> The Company’s values are promoted.
> Management decisions and actions are fair, consistent
and predictable;
Fundamental to building a high-performance culture are the Company’s strategic People pillars:
Transformation
Wellbeing & Safety
The continuity and resilience of our
business operations are crucial for
serving the needs of our people,
audience and customers, upholding
community trust and maintaining the
Company’s reputation. Our technology
infrastructure and platforms require
ongoing maintenance and updates to
ensure network, software applications
and hardware are resilient to ensure
we effectively mitigate risk across
the business.
Business processes are regularly
reviewed and, where necessary,
are either automated or non-core
activities are outsourced. The Company
continues to integrate and/or create
synergies from M&A activity, driving
greater agility and alignment across
all relevant business functions. Our
flexible work practices include a
range of technological measures
for those employees who are able
to work remotely to maximise their
safety and productivity.
We continue to implement employee
and industrial relations initiatives
across the business. New Enterprise
Agreements provide our people
with simpler and better agreements,
while aligning workplace terms and
conditions with community standards.
Seven West Media recognises the
value of effective workplace safety and
wellness as an integral part of how we
successfully manage our business. We
are committed to building a positive
health and safety culture, with a focus
on personal wellness, injury prevention
and the mitigation of risk through
maintaining high workplace safety and
wellness standards and performance.
With a comprehensive mental health
framework, strong risk management
processes and engaging wellness
initiatives, the business continues to
strive to improve in its safety outcomes,
including the Lost Time Injury Frequency
Rate (LTIFR) which continues to remain
below the industry benchmark. The
Company is also committed to extra
safety support to employees during
overseas deployments, wherever they
might be.
The Company provides specific
psychological support and 10 days’
paid leave per annum for employees
who are victims of domestic and/
or family violence. The Company is
involved in the NSW Government’s
Corporate Leadership Group advising
the Government on further initiatives to
eradicate sexual assault and domestic
violence in Australia.
With an increasing focus on mental
health, the Company has taken an
active focus on building awareness and
support for managing mental health
in our workplace. We have developed
and implemented a comprehensive
framework which includes training,
initiatives and events tailored for
managers and employees to support
positive mental health. Particular
emphasis has been placed on delivering
programs on resilience across the
organisation including burnout and
Vicarious Trauma programs for our News
and Broadcast Operations teams.
The Company’s wellness program
provides a range of benefits and
initiatives to optimise the physical
and mental health and wellness of
employees, including:
> Confidential counselling services
through our Employee Assistance
Program;
> Educational seminars on a variety of
health topics across our five Pillars
of Wellbeing – Work, Financial,
Physical, Mental and Community;
> Practical tools to manage stress and
mental health, such as introducing
mental health app ‘Calm’;
> Discounted offerings with fitness
and wellbeing partners;
> Flu vaccinations and skin checks; and
> Psychological risk training.
26
Risk Management, People and Sustainability Seven West Media Limited Annual Report 2022 The continuity and resilience of our business operations
are crucial for serving the needs of our people, audience
and customers, upholding community trust and
maintaining the Company’s reputation.
Our annual wellness program calendar
includes regular events and initiatives
supporting our five Pillars of Wellbeing
that are delivered to employees
across the various locations in which
we operate. The calendar is reviewed
regularly to ensure it continues to
prioritise key health topics and is aligned
to the unique needs of our employees.
Further online courses have been
completed by employees, including
compliance-related training for new
and existing employees (focusing on
cyber-security and fraud awareness,
anti-bribery and anti-money laundering,
privacy, mandatory training under
the Modern Slavery Act and other
compliance matters).
Performance & Reward
Reward and performance framework
and strategies are created to attract and
retain talented employees by rewarding
high performance and delivering superior
long-term results, while adhering to
sound risk management and governance
principles. We are committed to ensuring
that our remuneration and performance
approach supports positive, fair and
equitable outcomes for our people and
delivery of sustainable value for our
shareholders. Remuneration is not
just the direct amount of money paid
to an employee. It also involves non-
financial rewards and benefits.
The Board monitors our Remuneration
Policy and framework on an annual
basis to ensure it remains fit for purpose,
supports the Company’s strategy,
and delivers on the intended design.
Talent & Development
Our talent and development framework
ensures that we create an environment
where continuous learning is part
of an employee’s development and
progression so that they can reach their
full potential. This drives leadership
capability and is an important channel
through which our culture is embedded
and reinforced.
Over the past year, we continued
to invest in the growth, learning and
development of our employees, in
particular communication skills,
managing remote teams and wellness
training, support and seminars while
working remotely.
Mentoring, both internal and external,
has become a key feature of our culture.
It plays an important role in identifying
and supporting leadership development
while increasing engagement and
productivity.
Regular reviews, including setting key
performance indicators and ongoing
career development, are an important
part of performance measurement
and management and support
the Company’s high-performance
ambitions. As well as encouraging
regular and ongoing feedback with
managers, the Company requires all
employees to have at least two formal
review sessions with their manager each
year. During these reviews, employees
are encouraged to raise, discuss
and respond to matters relating to
performance, training, further education
and development of required skills
and capabilities.
The Company has stepped up its focus
on increasing the pool of management
capability where key high-potential
employees are identified and supported
through the Company. A thorough
talent and succession planning process
has resulted in a deeper review of
people and their potential, including
opportunities for female talent. A key
objective is to further embed gender
diversity as an active consideration in
succession planning. Executive level
succession plans were reviewed by
the Board and provide a diverse list of
candidates for whom development plans
are created to ensure preparedness
to take on future opportunities.
Culture, Engagement & EVP
Engagement and retention are
underpinned by the People Experience
(Px) which centres on four pillars –
Attract, Perform, Grow and Engage.
Employee engagement strategies
continue to evolve our Px initiatives
and programs such as ‘Moments That
Move Us’ on reward and recognition,
‘Spark’ mentoring program, ‘SWM
School’ learning platform, ‘Leading@
SWM’ leadership development, ‘7Perks’
employee benefits platform, ‘SWM
Wellness’ including financial wellness,
performance and development, digital
onboarding, and intern, graduate and
secondment programs.
We measure employee engagement
regularly through ‘Teamgage’, a
real-time employee engagement
survey platform based on eight key
engagement metrics – Values, Systems
& Processes, Strategic Alignment,
Communication, Flexible Workplace,
Innovation, Feedback and Safety.
All our people are provided the
opportunity to complete the survey
and provide honest feedback. Results
are aggregated into a real-time report
that is shared and discussed with
team members to drive new ideas and
improvements and assist in helping
shape the future of the Company.
Diversity, equity and inclusion (DEI) are
integral to our culture and how we live
our values. Reflecting the diversity of
our people, customers and communities
enables us to serve their needs. We
have further embedded our DEI and
environmental awareness programs to
ensure they support our culture and to
express these commitments at all levels.
Through these policies and practices,
we make it clear that discrimination
on any basis is not acceptable.
27
Corporate Social Responsibility
Diversity, Equity and Inclusion
The Company recognises and
encourages the social and
developmental benefits of skilled
volunteering and wider community
engagement by employees. The
Company also continues to support and
encourage employees to contribute to
worthy causes through its Workplace
Giving program. Whether it’s helping
find a cure for disease, saving the
environment or supporting people
in crisis, the Company encourages
employees to work together as a
business to help make an impact.
It also continues to encourage its
employees to make a difference
through providing opportunities to
participate in community fundraisers.
Our community contributions are
covered in the Sustainability section
of this Report.
Seven West Media recognises the
benefits of an inclusive and respectful
workplace culture that draws on the
experiences, diversity and perspectives
of our people. This is to ensure that
our business remains innovative and
sustainable, and continues to meet
the needs of our stakeholders and
audiences.
We view diversity through a broad lens
of difference in people across gender,
nationality, ethnicity, physical abilities,
sexual orientation, body type, gender
identity, generation/age, disability,
socio-economic status, religious belief,
parental status, professional and
educational background as well
as global and cultural experiences.
In March 2022, Seven West Media
became the first media company in
Australia to be awarded a citation as
Employer of Choice for gender equality
by the Workplace Gender Equality
Agency (WGEA). The criteria for the
citation are rigorous and we were one
of just 12 companies across Australia
to be added this year as an employer
having achieved gender equality in
the workplace. Seven’s commitment
to diversity, equity and inclusion will
continue and is demonstrated in our first
comprehensive sustainability report.
Diversity, Equity and Inclusion
Commitments and Initiatives
During FY22, the Board reviewed the
Company’s DEI Policy which is a key
part in its overall talent and culture
strategy and guides investment in the
areas of recruiting, staffing, account
planning, succession planning,
promotions and development. The
Company supports an inclusive work
environment where people have
genuine and equitable access to career
opportunities, training and benefits.
We progressed our commitments during
FY22 including:
> Including the Prime Media Group
transaction, we achieved an
overall female gender balance of
48 per cent across our workforce
as well as maintained the female
representation in management
positions of 50 per cent. This result
continues to be supported by our
equal opportunity recruitment
process. The Board recognises the
importance of diversity at Board
level and aims to achieve a minimum
of 30 per cent female representation
in the coming years.
> Continued advisory role to the
NSW Government’s Corporate
Leadership Group (CLG) in relation
to Domestic and Family Violence
and Sexual Assault.
> Partnered with UN Women Australia
at a national level for the 2022
International Women’s Day (IWD)
live and virtual events. We also
extended our partnership with UN
Women Australia to participate in the
‘Unstereotype Alliance’ which aims to
eradicate stereotypes in advertising
with regards to gender equality.
> Established the David Leckie Seven
Scholarship Program in memory of
our former Chief Executive Officer,
the late David Leckie AM. The
annual program offers a 12-month
scholarship at Seven West Media
for a junior graduate with a passion
for sales, programming or news.
> Implemented the Company’s
inaugural Reconciliation Action
Plan (RAP) through the delivery
of a 12-month ‘Reflect’ stage
program of work.
> Developed a company wide
sustainability framework and
strategy.
> Revised our processes and procedures
on the casting of contestants with our
production partners.
28
Risk Management, People and Sustainability Seven West Media Limited Annual Report 2022 We will continue to focus our strategy
to achieve a more diverse, equitable
and inclusive workplace in other
areas of the business by:
> Embedding flexibility in the way
we work;
> Supporting our commitment to
diversity, equity and inclusion;
> Uncovering and taking steps
to mitigate potential bias in our
behaviours, systems, policies
and processes; and
> Ensuring our brand is attractive and
caters to a diverse range of people.
The Company has posted its Workplace
Gender Equality Act Public Report
for 2021–2022 on its website, which
contains the Company’s Gender
Equality Indicators.
The Company’s progress against
diversity objectives were established in
2018, and our commitments set for the
financial year can be found on pages
28 and 29 of this Annual Report.
> Revised our leave policy to increase
company-funded parental leave for
secondary carers and removed the
qualifying period for eligibility of
gender-neutral paid parental leave.
> Continued to celebrate LGBTIQ+
Pride and held team events (virtually
and in small groups) across the
Company to support our diverse
and inclusive culture.
> Continued participation in the
‘The Everyone Project’ which is an
initiative from the Screen Diversity
and Inclusion Network (SDIN) to
benchmark and track the diversity
of the Australian screen industry.
> Implemented our digital onboarding
process for new starters.
> Launched and implemented
‘Teamgage’, a real-time employee
engagement survey platform.
> Launched and implemented an
employee benefits platform,
‘7Perks’ to support employee
engagement and retention.
> Continued to build on the
Company’s ‘Financial Wellbeing’
programs including Mercer’s
‘Super for Women’.
> Continued supporting initiatives in
relation to eradicating domestic
and family violence and sexual
assault, including supporting the
‘Make No Doubt’ campaign.
> Partnered with White Ribbon in
campaign launches, such as
‘Be the Change’ campaign.
> Continued to hold events through
Mental Health Month (October)
and on ‘R U OK? Day’.
> Continued support for the ‘Speak
Out - 16 Days of Activism Against
Gender Based Violence’ campaign.
Female Representation in
Management Positions
50%
Seven West Media became the first media company
in Australia to be awarded a citation as Employer of
Choice for gender equality by the Workplace Gender
Equality Agency.
29
Risk Management, People and Sustainability
Seven West Media Limited Annual Report 2022
Sustainability
Seven West Media’s critical role in Australian society is underpinned
by our commitment to use the power of our platforms to inspire a
better us. Us is all of us. It includes individuals, groups, communities,
the nation as a whole, and internally the Seven West Media team.
We aim to achieve a positive impact by uniting the people and the communities in which
we operate, providing opportunities for future generations, representing Australia by
supporting diversity, equity and inclusion internally and externally, and by being
environmentally responsible and promoting important environmental causes.
Over the last financial year, we used the power of our platforms to bring awareness to
important community issues and raise over $100 million dollars in fundraising events
and donated $45 million worth of community service hours to more than 150 causes
and organisations which are important to Seven and our stakeholders.
30
Representing Australia
Our team at Seven West Media
encompasses multiple backgrounds
and life experiences. We believe a
richness in diversity, as well as an
inclusive and equitable workplace,
leads to better outcomes for our people,
partners, audiences and shareholders.
Internal diversity and
Reconciliation support:
Diversity and inclusiveness are at
the core of our values and part of
our business strategy at all levels.
We are focused on improving
opportunities for people from diverse
backgrounds and increasing the pace
of progress in this area.
We want our workforce to represent
the broader community in which we
operate, leveraging differences to
achieve better business results and
deliver a superior experience for all
our stakeholders.
We have the structures and programs in
place to ensure continuous improvement,
with positive steps undertaken across
the business this year. These are covered
in the people section of this report.
Representing Australia’s
diversity on-screen
Externally, we reflect Australia’s diversity
through our news, entertainment and
sport coverage, playing a critical role
in how Australians perceive themselves
and their country.
We are constantly evolving our content to
be more diverse and inclusive, ensuring
our products and services continue to
appeal to Australian audiences.
Quality Australian content has far-
reaching impacts beyond the number
of people who watch and engage with
it each day. It enriches the social fabric
of Australia. It informs voters. It holds
the powerful to account. It tells stories.
It provides employment. It promotes
Australian tourism.
Seven West Media is committed to
using its power as Australia’s leading
broadcaster across television and
BVOD to lead positive social change.
In 2022, the company joined the
Unstereotype Alliance’s Australian
chapter to help end unhelpful
stereotypes in advertising and media
content that hold women back.
Seven West Media is a member of the
Screen Diversity Inclusion Network
(SDIN) and is participating in the ‘The
Everyone Project’ together with the SDIN
to benchmark and track the diversity
of the Australian screen industry.
We are also driving representation
in our own productions.
In 2021 Seven filmed the drama series
RFDS, in Broken Hill. The production
starred five First Nations Australians,
30 First Nations extras, one First
Nations consultant and one First
Nations writer/director.
Seven’s #1 hit entertainment show,
The Voice, has a highly diverse range of
contestants, including across heritage,
age, ability, sexual orientation and
gender.
We are also revising our processes and
procedures with production partners
on the casting of contestants and
improving diversity of on-screen talent
with production partners.
We have a long-term partnership with
the AFL on diversity and community
initiatives including the AFL Indigenous
Round, as well as the AFL ANZAC Round
and AFL Sir Doug Nicholls Round.
Seven West Media also supports
Australia’s Para athletes as the
broadcaster for the Paralympic
Games Tokyo 2020, the Paralympic
Winter Games Beijing 2022 and the
Birmingham 2022 Commonwealth
Games, which includes a fully
integrated para program.
The Voice
The Voice
31
Opportunities for
future generations
Contributing to better opportunities for
future generations, particularly when it
comes to health and social outcomes,
means a lot to Seven West Media.
That’s why we dedicate major resources
to projects and initiatives right across
Australia that deliver a better future for
younger Australians, especially around
children’s health and medical research.
Children’s health and
medical research
Seven West Media, in partnership with
the Channel 7 Telethon Trust, runs the
Perth Telethon each year to financially
support the medical and social welfare
of children and young people, and to
fund new preventions, treatments and
cures for diseases affecting young
people across Australia.
The Telethon has raised over $400
million since its inception in 1968.
Since 2010, each Telethon has set a
new record for the total amount raised.
In 2021 Telethon raised A$62.1 million.
Telethon
The Group also supports the Good
Friday Appeal in Victoria, a partnership
with the Royal Children’s Hospital and
The Herald Sun that spans 90 years,
which raised $22.3 million to support
the hospital in the 2022 appeal.
Channel Seven also has a Children’s
Research Foundation based in South
Australia that awards annual grants
and awards to research that support
Children’s Medial Research. Last
financial year the foundation awarded
over $1.2 million in research grants.
David Leckie Seven Scholarship
Program
Further demonstrating the Group’s
commitment to future generations, in
September 2021 Seven West Media
announced the establishment of
the David Leckie Seven Scholarship
Program in memory of former Chief
Executive Officer, the late David
Leckie AM. The annual program,
set up in conjunction with Skye Leckie
and David and Skye’s sons Harry
and Ben, offers a 12-month scholarship
at Seven West Media for a junior
graduate with a passion for sales,
programming or news. In March 2022,
Madeline McKeown was announced
as the inaugural recipient.
Supporting sports from
grassroots to national level
We are proud of our work to support
sport from grassroots through to the
professional level, given the importance
of organised sport for physical and
mental health. Media rights are the
lifeblood of sport and Seven West Media
underpins the AFL competition enabling
all Australians to watch it for free.
The Group has an existing network
of strong partnerships with sporting
groups, from a national and professional
level through to local community
sporting groups. The support we
provide includes fundraising, donations
and profile-raising. We are also a
supporter of the Paralympics including
supporting the “Green and Gold virtual
seat” campaign raising funds for the
Paralympic team and we have used
our platform as the broadcaster of the
Olympics to encourage Australians to
get the COVID-19 vaccinations.
Providing opportunities for
youth development
Seven West Media works with
organisations focused on supporting
young Australians, including UnLtd,
Whitelion, and Australia’s Young
Achiever Awards. We also support the
NSW and Victoria Schools Spectacular.
32
Risk Management, People and Sustainability Seven West Media Limited Annual Report 2022 Uniting people
and communities
We are locals in the communities in
which we operate. We are part of
the glue that unites our communities,
creating shared understanding and
fostering the spirit of Australia in an
authentic and engaging way.
Supporting local community groups
Giving back to our communities is in our
DNA. Several of Seven West Media’s
partnerships with community groups,
NGOs and charities focus on community
engagement, connection and support –
including multiple initiatives specifically
focused on young people and fostering
leadership. This also includes helping to
rally support around national crises –
such as the Australia Unites: Red Cross
Flood Appeal, which raised $25.3 million
for people and communities affected
by the Queensland and NSW floods
in 2022.
Supporting vulnerable
members of the community
Seven West Media also puts a priority
on helping those in our community who
are most vulnerable.
We have initiatives to support and
protect the victims of domestic abuse
– including partnerships with White
Ribbon, Make No Doubt and others.
We also provide contact details and
links to domestic violence groups
in all relevant editorial and support
campaigns through on-air CSAs.
Seven West Media reports on the
actions taken to address modern
slavery and human trafficking in its
business and supply chain, in line
with the Modern Slavery Act 2018.
Mental health initiatives
Seven West Media is also focused on
supporting mental health initiatives,
both internally for our people and to
raise awareness of mental health issues
in the community through sponsorship
of initiatives, as well as regular news
coverage of relevant issues. Seven
West Media also provides profile and
awareness during Mental Health Month.
Big Freeze 8
The Big Freeze, through events such
as the celebrity slide and sale of its
iconic blue beanies, raises awareness
and funds for Fight Motor Neurone
Disease. Big Freeze 8 held on June 10,
2022 raised a record-breaking
$19.8 million.
Supporting arts and culture
As part of Australia’s creative industry,
we are proud to support arts and
cultural initiatives that unite Australians.
Seven West Media invests in arts
and culture partnerships, including
the National Gallery of Australia, Art
Exhibitions Australia, the Melbourne
Symphony Orchestra and the Fringe
Festival.
We have also worked with the
Schools Spectacular to create virtual
experiences during the pandemic,
embodying our purpose of bringing
Australians closer to ‘moments that
move us’.
The Big Freeze
33
Empowering communities through
trusted information and providing
Australians with impartial news Whether
it’s 7NEWS, Sunrise, or The West
Australian, we provide our communities
with the latest, trusted news and
information that helps them interpret
what is happening in our nation, their
state, territory or local community.
By providing fearless and accurate
reporting, we contribute to keeping our
democracy healthy and functioning.
We also work to enable more members
of the community have access to this
information through accessibility
initiatives, including closed captions on
most programs and providing coverage
of interpreters when they are present.
Building community trust with
strong data security governance
Seven builds trust through strong data
security governance, recognising
our responsibility to those using and
engaging with our platforms, and
acting ethically with the collection, use,
and disclosure of data according to our
policies and industry best practice.
Bringing awareness to
environmental issues
At Seven West Media, we are committed
to bringing awareness to environmental
issues, while also reducing the
environmental impact of our business
activities on the communities and
environment in which we operate.
Reducing our impact
Seven West Media is actively
working towards reducing Scope 1
and 2 emissions under the National
Greenhouse & Energy Reporting Act
(2007), as well as Scope 3 voluntary
emissions where possible.
With the acquisition of the assets of
Prime Media Group completed during
the financial year, a new baseline of
emissions will be calculated for 2022/23
to take into account the increased
footprint of the combined entity.
We donate or recycle the majority of
our redundant electronic IT assets via
certified eCycling companies, reducing
what goes to the landfill. In FY22, only
an immaterial amount was not donated
or recycled. This was due to permanent
e-waste recycling bins placed at our
largest sites.
As part of our long term fleet reduction
initiative, we will continue to reduce
vehicle numbers. The size of our fleet
has increased this year on aggregate
through the addition of Prime Media
Group vehicles; but excluding this the
fleet has decreased 27.5 per cent over
the past 8 years.
Seven West Media operated on 18.6
per cent renewable energy in FY21
and we are currently in the process
of assessing our emissions across
the business.
Seven West Media will make significant
energy savings by vacating its Martin
Place tenancy in the Sydney CBD during
2023 and relocating the studio and
News and Public Affairs operations to its
Eveleigh site, a 5-star NABERS building
with 4 Star Greenstar Interiors rating.
Australia Unites: Red Cross Flood Appeal – James Warburton, Amanda Keller,
Ben Fordham, Beverley McGarvey, Natalie Barr and Michael Healy
34
Risk Management, People and Sustainability Seven West Media Limited Annual Report 2022 Printed editions of our newspaper are
important for accessibility to news
in many of the communities in which
we operate. We are mindful of the
environmental impact that newspaper
production has on our environment and
aim to reduce the impact of the physical
copies of our newspapers. WAN
undertake the following sustainability
initiatives:
> The paper used to print the West
Australian, Sunday Times, Regional
and Community titles is sourced from
a mix of recycled consumer product
and certified plantation forests
> WAN also ensures any paper used is
not from illegally logged timber. Any
virgin fibre required is sustainably
sourced.
> The West Australian and The
Sunday Times printed waste
measure is < 5 per cent per year
and all waste was recycled.
> Waste ink produced in Perth is
collected and reprocessed and
plant wastewater is processed and
used for reticulation on site.
The production of television content
can also have an environmental
impact. We are now working in more
efficient ways with our production
partners to reduce and offset carbon
emissions across a range of shows. This
includes working with various suppliers
including production companies and
facility providers to reduce the need
for complete turnover of facilities
between shows and reduced freighting
between seasons. We are also looking
for opportunities to consolidate
our building space to reduce our
environmental impact.
Raising Awareness for important
environmental issues
Seven West Media supports community
initiatives to raise awareness of
important environmental issues. Over
the last year, Seven West Media has
supported the BCF OzFish campaign
to promote the health of waterways.
OzFish Unlimited is a not-for-profit
organisation dedicated to the protection
and restoration of our waterways.
Seven West Media supported Planet
Ark’s National Recycling Week with
free airtime and has also brought
awareness to Planet Ark’s National Tree
Day, Australia’s largest community tree
planting and nature care event.
Free airtime was provided to promote
‘Clean Up The Beaches’ campaign
and the Great Barrier Reef Marine
Park Authority. For the month of June
2022 support was provided to the
Rockhampton Regional Council with
their disaster management campaign.
For the months of November and
December 2021, Seven West Media
provided Community Service airtime
support for Fraser Coast Regional
Council’s annual waste awareness
campaign. Seven also provided support
for the Waste Monsters’ campaign,
raising awareness and engagement
on the councils’ new waste and
recycling trucks.
The West Australia Noongar-English bilingual
edition for Reconciliation Week
Good Friday Appeal – Rebecca Maddern,
Abbey Holmes and Peter Mitchell with Isla
35
Board of
Directors
Kerry Stokes AC
Chairman – Non-Executive
Director
James Warburton
Managing Director and
Chief Executive Officer
Mr Warburton is Managing Director & Chief Executive Officer
of Seven West Media Limited.
Prior to his appointment as Managing Director and CEO
of Seven West Media, Mr Warburton was Managing
Director and Chief Executive Officer of APN Outdoor, from
22 January 2018, where he led a significant transformation
and turnaround at the company before departing in late 2018
when APN Outdoor was acquired by JCDecaux for a record
valuation.
Before his appointment to APN Outdoor, Mr Warburton was
the Chief Executive Officer of Supercars for five years. In this
position, Mr Warburton drove significant growth in the sport
and delivered unprecedented broadcast, sponsorship and
funding deals.
Mr Warburton has also held senior leadership roles at media
buying company Universal McCann. He was Chief Digital
and Sales Officer of the Seven Media Group, and he was the
Managing Director and Chief Executive Officer of Network 10.
Mr Warburton was appointed to the Board on 16 August 2019.
Mr Stokes was Executive Chairman of Seven Group Holdings
Limited, a company with a market-leading presence in the
resources services sector in Australia and formerly in north
east China and a significant investment in energy and also in
media in Australia through Seven West Media. Mr Stokes held
this position from April 2010 until November 2021. He is also
Chairman of Australian Capital Equity Pty Limited, which has
substantial interests in media and entertainment, resources,
energy, property, pastoral and industrial activities.
Mr Stokes is a former Chairman of the Australian War
Memorial and a former Chairman of the National Gallery of
Australia. Mr Stokes holds professional recognitions which
include an Honorary Doctorate in Commerce at Edith Cowan
University and an Honorary Fellow of Murdoch University.
Mr Stokes has, throughout his career, been the recipient of
awards, including Life Membership of the Returned Services
League of Australia; 1994 Paul Harris Rotary Fellow Award;
1994 Citizen of Western Australia for Industry & Commerce;
2002 Gold Medal award from the AIDC for Western
Australian Director of the Year; 2007 Fiona Stanley Award
for outstanding contribution to Child Health Research; 2009
Richard Pratt Business Arts Leadership Award from the
Australian Business Arts Foundation; 2011 Charles Court
Inspiring Leadership Award; 2013 West Australian of the Year;
2014 Awarded Keys to the City of Perth and 2014 Awarded
Keys to the City of Melbourne.
Mr Stokes was awarded Australia’s highest honour, the
Companion in the General Division in the Order of Australia
(AC) in 2008. In 1995, he was recognised as Officer in the
General Division of the Order of Australia (AO).
Mr Stokes was appointed to the Board on 25 September
2008 and became Chairman of Seven West Media Limited
(formerly West Australian Newspaper Holdings Ltd) on
11 December 2008.
36
Governance Seven West Media Limited Annual Report 2022 John Alexander
Non-Executive Director
David Evans
Non-Executive Director
Mr Alexander was the Executive Chairman of Consolidated
Media Holdings Limited (CMH) from 2007 to November 2012,
when CMH was acquired by News Corporation. Prior to 2007,
Mr Alexander was the Chief Executive Officer and Managing
Director of Publishing and Broadcasting Limited (PBL)
from 2004, the Chief Executive of ACP Magazines Limited
from 1999 and PBL’s group media division comprising ACP
Magazines Limited and the Nine Network from 2002. Before
joining the PBL Group, Mr Alexander was the Editor-in-Chief,
Publisher & Editor of The Sydney Morning Herald and Editor-
in-Chief of The Australian Financial Review.
Mr Evans is Non-Executive Chairman of E & P Financial Group
Limited and was appointed a director of that company in
February 2017. Mr Evans established Evans and Partners Pty
Ltd, the investment advisory company in June 2007.
Since 1990, Mr Evans has worked in a variety of roles within
JB Were & Son, and then the merged entity Goldman Sachs
JBWere Pty Ltd (GSJBW). Prior to establishing Evans and
Partners, Mr Evans ran Goldman Sachs JBWere’s Private
Wealth business and the Institutional Equities business. His
most recent role at GSJBW was as Managing Director and
Chief of Staff.
Mr Alexander was a director of Crown Resorts Limited from
6 July 2007 to 22 October 2020 and was formerly a director
of Foxtel Management Pty Limited, Fox Sports Australia Pty
Limited, SEEK Limited, Carsales.com Limited, Ninemsn Pty
Limited and CrownBet.
Mr Alexander is Chairman of the Remuneration &
Nomination Committee.
Mr Alexander was appointed to the Board on 2 May 2013.
Mr Evans holds a Bachelor of Economics from Monash
University.
Mr Evans is a member of the Audit & Risk Committee and
a member of the Remuneration & Nomination Committee.
Mr Evans was appointed to the Board on 21 August 2012.
Teresa Dyson
Non-Executive Director
Colette Garnsey OAM
Non-Executive Director
Ms Dyson is an experienced company director with a
broad range of experience across public and private sectors.
Ms Dyson has been closely involved in strategic decision
making in business and organisational structuring, covering
the financial services, transport, energy and resources sectors,
as well as infrastructure projects.
Ms Dyson is a director of Energy Queensland, Brighter Super,
Gold Coast Hospital and Health Board, Fare Limited, and is
a member of the Foreign Investment Review Board and the
Takeovers Panel. She has been a Director of Genex Power
Limited since May 2018 and Shine Justice Limited since
February 2020 and was a Director Consolidated Tin Mines
from January 2019 to January 2020.
Ms Dyson holds a Masters of Applied Finance from
Macquarie University. She graduated with a Bachelor
of Laws (Honours), a Bachelor of Arts and Masters of
Taxation from the University of Queensland and is a
graduate of the Australian Institute of Company Directors.
Ms Dyson is Chairman of the Audit and Risk Committee.
Ms Dyson was appointed to the Board on 2 November 2017.
Ms Garnsey has been a Non-Executive Director of Flight
Centre Travel Group since February 2018, Magellan Financial
Group since November 2020 and Chairman of Laser Clinics
Australia. Ms Garnsey is a former Non-Executive Director
and former Chair of Australian Wool Innovation Limited.
Ms Garnsey has over 30 years’ executive experience, having
held senior management positions at David Jones, Pacific
Brands, and Premier Investments, encompassing strategy,
operations, marketing, business planning and business
transformation. She spent over 20 years with David Jones
Limited rising to become Group General Manager.
Ms Garnsey has served on the board of the Melbourne
Fashion Festival. She has also advised the CSIRO, The
Federal Innovation Council, and the business advisory
boards of various Federal Trade and Investment Ministers
and Australian Fashion Week.
Ms Garnsey is a member of the Remuneration &
Nomination Committee.
Ms Garnsey was appointed to the Board on 12 December 2018.
37
Michael Malone
Non-Executive Director
Ryan Stokes AO
Non-Executive Director
Mr Malone founded iiNet in 1993 and continued as CEO
for more than 20 years. iiNet listed on the ASX in 1999 and
grew to service over a million households and businesses,
with revenues and market cap of over $1 billion and 3,000
staff. After leaving iiNet, Mr Malone went on to co-found
Diamond Cyber Security.
Mr Malone is a Non-Executive Director of NBN Co,
a former Director of Axicom Pty Ltd, a former Director of
DUG Technology Limited from June 2020 to August 2021,
a former Director of SpeedCast International Ltd from
May 2014 to July 2022 and a former Director/Chairman
of Superloop Ltd from April 2015 to March 2020. He is
also a member of the Advisory Committee of the Regional
and Small Publishers Innovation Fund.
Mr Stokes is Managing Director & Chief Executive Officer
of Seven Group Holdings (SGH) and has been a Director of SGH
since April 2010. SGH owns approximately 38.9 per cent of SWM.
Mr Stokes is Chairman of WesTrac, Chairman of Coates
and Chairman of Boral and Director since September 2020.
He was appointed a Director of Beach Energy in July 2016
and became an alternate Director of Beach Energy in
November 2021.
Mr Stokes is Chief Executive Officer of Australian Capital Equity
Pty Limited (ACE). ACE is a private company with its primary
investment being an interest in SGH. Mr Stokes was appointed
Chairman of the National Gallery of Australia in July 2018. He
is also a member of the IOC Olympic Education Commission.
Mr Malone was recognised as the Australian Entrepreneur of
the Year, CEO of the Year in the Australian Telecom Awards
and National Customer Service CEO of the Year and is a
recipient of the Charles Todd Medal.
Mr Malone is a member of the Audit & Risk Committee.
Mr Malone was appointed to the Board on 24 June 2015.
Mr Stokes was Chairman of the National Library of Australia
from 2012 to 2018. Mr Stokes was an Executive Director and
then Chairman of Pacific Magazines from 2004 to 2008
and a Director of Yahoo7 from 2005 to 2013. Mr Stokes
was a member of the Prime Ministerial Advisory Council
on Veterans Mental Health from 2014 to 2019.
Mr Stokes holds a BComm from Curtin University and is
a Fellow of the Australian Institute of Management (FAIM).
Mr Stokes was appointed an Officer in the General Division
of the Order of Australia in the Queen’s Birthday honours
announced on 8 June 2020.
Mr Stokes is a member of the Remuneration &
Nomination Committee.
Mr Stokes was appointed to the Board on 21 August 2012.
Michael Ziegelaar
Non-Executive Director
Mr Ziegelaar is a senior partner of global law firm Herbert
Smith Freehills, where he is the Co-Head of the Australian
Equity Capital Markets Group. He specialises in corporate,
equity capital markets and M&A transactions and has acted
for a wide range of clients across various industries.
Mr Ziegelaar is also a non-executive director of the Burnet
Medical Research Institute.
Mr Ziegelaar holds a Bachelor of Laws (Hons), a Bachelor of
Economics (majoring in Accounting and Corporate Finance)
and a Master of Laws (majoring in Commercial Law) from
Monash University.
Mr Ziegelaar is a member of the Audit & Risk Committee.
Mr Ziegelaar was appointed to the Board on 2 November 2017.
38
Governance Seven West Media Limited Annual Report 2022 Corporate Governance
Overview
This Corporate Governance Overview outlines the Company’s
main corporate governance practices that were in place
throughout the financial year ended 25 June 2022.
The Company’s full 2022 Corporate Governance Statement,
which set outs the Company’s compliance with the 4th
edition of the ASX Corporate Governance Council Corporate
Governance Principles and Recommendations (“ASX
Recommendations”), unless otherwise stated, is available
in the “Corporate Governance” section of the Company’s
website at www.sevenwestmedia.com.au/about-us/
corporate-governance. Board and Committee Charters
and a number of the corporate governance policies referred
to in the 2022 Corporate Governance Statement are also
available at the above link.
The documents marked with an * below have been posted
in the ‘Corporate Governance’ section on the Company’s
website at www.sevenwestmedia.com.au/about-us/
corporate-governance.
Role and Responsibilities of the Board
The Board is empowered to manage the business of
the Company subject to the Corporations Act and the
Company’s Constitution*. The Board is responsible for
the overall corporate governance of the Company and
has adopted a Board Charter* setting out the role and
responsibilities of the Board as well as those functions
delegated to Management.
Delegation to Management
Subject to oversight by the Board and the exercise by the
Board of functions which it is required to carry out under
the Company’s Constitution, Board Charter and the law,
it is the role of management to carry out functions that are
expressly delegated to management by the Board, as well
as those functions not specifically reserved to the Board,
as it considers appropriate, including those functions and
affairs which pertain to the day-to-day management of
the operations and administration of the Company.
Management must supply the Board with information in
a form, timeframe and quality that will enable the Board
to discharge its duties effectively, including information
concerning the Company’s compliance with material
legal and regulatory requirements and any conduct that
is materially inconsistent with the values or Code of
Conduct of the Company.
Board Composition
The Company’s Constitution provides for a minimum of three
Directors and a maximum of twelve Directors on the Board.
As at the date of this statement, the Board comprises nine
Directors, including eight Non-Executive Directors and the
Managing Director and Chief Executive Officer.
The Non-Independent Directors in office are:
> Mr Kerry Stokes AC, Chairman
> Mr Ryan Stokes AO, Director
> Mr James Warburton, Managing Director &
Chief Executive Officer
The Independent Directors in office are:
> Mr John Alexander, Director
> Ms Colette Garnsey OAM, Director
> Ms Teresa Dyson, Director
> Mr David Evans, Director
> Mr Michael Malone, Director
> Mr Michael Ziegelaar, Director
The qualifications, experience, expertise and period in office
of each Director of the Company at the date of this Annual
Report are disclosed in the Board of Directors section of this
Annual Report on pages 36 to 38.
Chairman
The roles of the Chairman and Chief Executive Officer
are separate. Mr Kerry Stokes AC is the Chairman of the
Company. The Chairman is responsible for leading the Board,
facilitating the effective contribution of all Directors and
promoting constructive and respectful relations between
Directors and between the Board and Management.
The Board acknowledges the ASX Recommendation that
the Chairman should be an Independent Director, however
the Board has formed the view that Mr Stokes is the most
appropriate person to lead the Board as its Chairman given
his experience and skills, particularly with regard to his long-
term association with various media businesses of the Group.
In addition, the Company has a clear conflict of interest
protocol to manage the relationships between the Company
and Seven Group Holdings Limited.
39
Board independence
The Board comprises a majority of Independent Directors,
with three Non-Independent Directors and six Independent
Directors. In determining whether a Director is independent,
the Board conducts regular assessments and has regard to
whether a Director is considered to be one who:
> is a substantial shareholder of the Company or an officer
of, or otherwise associated directly with, or represents
or has been within the last three years an officer or
employee of a substantial shareholder of the Company;
> receives performance-based remuneration (including
options or performance rights) from, or participates
in an employee incentive scheme of, the entity;
> is, or has previously been, employed in an executive
capacity by the Company or another Group member,
and there has not been a period of at least three years
between ceasing such employment and serving on
the Board;
> has within the last three years been a principal of a
material professional advisor of, or a material consultant
to, the Company or another Group member, or an
employee materially associated with the service provider;
> is a material supplier or customer of the Company or other
group member, or an officer of or otherwise associated
directly or indirectly with a material supplier or customer;
> has a material contractual relationship with the Company
or another group member other than as a Director; or
> has been a Director of the entity for such a period that
their independence from management and substantial
holders may have been compromised.
The Board determines the materiality of a relationship on
the basis of fees paid or monies received or paid to either
a Director or an entity which falls within the independence
criteria above. If an amount received or paid may impact the
Earnings Before Interest, Tax, Depreciation and Amortisation
(EBITDA) of the Group in the previous financial year by more
than 5 per cent, then a relationship will be considered material.
In the Board’s view, the Independent Directors referred to
above are free from any interest, position or other relationship
that might, or reasonably be perceived to, influence, in
material respect the capability to bring an independent
judgement to bear on issues before the Board and to act in
the best interests of the Company as a whole rather than in
the interests of an individual security holder or other party.
Mr Michael Ziegelaar is a partner at Herbert Smith Freehills,
a law firm which provides certain legal services to the
Company. The legal services provided by Herbert Smith
Freehills are not considered material having regard to the
principles above and Mr Ziegelaar is not involved in providing
the services. The Board is satisfied that Mr Ziegelaar’s
role with Herbert Smith Freehills does not interfere with the
independent exercise of his judgment as a Non-Executive
Director of the Company.
Mr Kerry Stokes AC and Mr Ryan Stokes AO are not regarded
as independent within the framework of the independence
guidelines set out above because of their current and/or
recent positions within Seven Group Holdings Limited, which
is a major shareholder of Seven West Media Limited.
Due to his position as Managing Director & Chief Executive
Officer, Mr James Warburton is not considered to be
independent.
Appointment of Directors
The policy and procedure for the selection and appointment
of new Directors is set out in an Annexure to the Board
Charter. The factors that will be considered when reviewing a
potential candidate for Board appointment include:
> the skills, experience, expertise and personal qualities that
will best complement Board effectiveness having regard
to the Board skills matrix, including a deep understanding
of the media industry, corporate management and
operational, safety and financial matters;
> the existing composition of the Board, having regard to
the factors outlined in the Company’s Diversity Policy and
the objective of achieving a Board comprising Directors
from a diverse range of backgrounds;
> the capability of the candidate to devote the necessary
time and commitment to the role (this involves a
consideration of matters such as other board or executive
appointments); and
> potential conflicts of interest and independence.
Directors appointed to fill casual vacancies hold office until
the next Annual General Meeting and are then eligible for
election by shareholders. In addition, each Director must
stand for re-election at the third Annual General Meeting
of the Company since they were last elected. The Notice of
Meeting for the Annual General Meeting discloses material
information about Directors seeking election or re-election,
including appropriate biographical details, qualifications
and other key current directorships.
The date at which each Director was appointed to the Board
is announced to ASX and is provided in this Annual Report on
pages 36 to 38.
Company’s Purpose and
Strategic Objectives
The Board has approved the Company’s purpose as “To
bring all Australians closer to the moments that move us”. The
Company’s purpose is an aspirational reason for being that
inspires a call to action for our people and stakeholders.
The Board also approved the following areas as strategic
objectives for the Company to achieve this purpose and
underpin the Company’s economic sustainability:
40
Governance Seven West Media Limited Annual Report 2022 What we want to be in three to five years:
1. Diversified media company.
2. Audience-led and digital first; powered by
data and technology.
3. Total audience monetisation with material
non-advertising revenue.
4. Low gearing with capacity for growth and
capital management.
5. Re-weighting of portfolio to increase allocation
to growth.
How we get there:
> Being unmissable & easy to access
– Win on every screen in all genres of news, sport
and entertainment across all key demographics.
– Deepening audience relationships with a greater
allocation to digital.
> Growing through technology and scale
– Driving scale, efficiencies, capability and
defensibility.
– M&A with non-media companies, leverage scale
to drive total audience monetisation.
> Driving Value
Skills and Experience
Media industry leadership
Percentage
80%
Senior executive or Board level experience
in the media industry, including in-depth
knowledge of the legislative and regulatory
framework governing this industry.
Banking, finance, asset and
capital management
Senior executive or Board level experience
and understanding of banking markets and
commercial financing arrangements as well
as strategic planning and oversight of asset
allocation and capital management.
Marketing, sales and product
distribution, customer and
audience insights
Senior executive or Board level experience
in delivering product offerings to market,
including marketing, branding and
optimising sales processes, and customer
and audience insights and experience in
product distribution systems.
90%
80%
Investment, mergers and acquisitions,
venture capital and entrepreneurship
97%
– Empowering everyone to think and act like an owner;
constantly questioning... is there a better way?
For more information on the Company’s strategic priorities
and strategic outlook see pages 4 to 5 of this Annual Report.
Senior executive or Board level experience
in analysis and identification of business
and market opportunities as well as
execution in relation to investment, mergers
and entrepreneurial activities.
Technology, digital media
and transformation
77%
Senior executive or Board level
experience in relation to digital media and
transformation, information management,
information technology, digital and
streaming product technology, and the
oversight of implementation of major
technology projects.
Board Skills Matrix
The Board has developed a Board Skills Matrix, which
is reviewed each year, reflecting the desired skills and
experience required to be able to deliver on the strategic
objectives of the Company. The Board believes that these
skills and experiences are well-represented by its current
composition.
The Board Skills Matrix is set out in two parts. The first table
outlines the desired industry specific skills and experience,
which continues to evolve given the rapid changes in the
media industry, and the second table outlines the depth of
general corporate, executive and Director experience which
are appropriate for the Company.
The tables also outline the percentage of current Directors
possessing those skills and experience on a weighted
average basis.
41
Skills and Experience
Percentage
Audit & Risk Committee
CEO and Board level experience
100%
Significant business experience and
success at a senior executive level.
As at the date of this statement, the Audit & Risk Committee
comprises the following members, all of whom are
Independent Directors and all of whom are non-executives:
Accounting and treasury
73%
> Ms Teresa Dyson (Chairman of the Committee)
> Mr David Evans
> Mr Michael Malone
> Mr Michael Ziegelaar
97%
The relevant qualifications and experience of the members
of the Committee are set out on pages 36 to 38 under the
heading Board of Directors.
Senior executive or equivalent experience
in financial accounting and reporting,
corporate finance, internal financial
controls and an ability to probe the
adequacies of financial risk controls.
Corporate governance, regulatory,
sustainability and organisation
management
Commitment to the highest standards
of corporate governance (including
sustainability and stakeholder relations)
and experience within an organisation
that is subject to rigorous governance and
regulatory standards.
Attendance at Committee meetings by management is at the
invitation of the Committee. Directors who are non-Committee
members may also attend any meeting of the Committee by
invitation. The Chairman of the Committee reports to the Board
on the Committee’s considerations and recommendations.
Remuneration & Nomination Committee
The Board has established a Remuneration & Nomination
Committee comprised of the following members, all of whom
are Independent Directors except for Mr Ryan Stokes AO:
> Mr John Alexander (Chairman)
> Mr David Evans
> Ms Colette Garnsey OAM
> Mr Ryan Stokes AO
The Remuneration & Nomination Charter* provides that the
Committee must consist of a minimum of three members
and must have a majority of Independent Directors, all of
whom must be Non-Executive Directors. Attendance at
Committee meetings by management is at the invitation of
the Committee. Directors who are non-Committee members
may also attend any meeting of the Committee by invitation.
The Chairman of the Committee reports to the Board on the
Committee’s considerations and recommendations.
Board, Committee and Director
performance evaluation
During the financial year, Directors completed a Board
Evaluation questionnaire concerning Board, Committee
and Director, including Chairman, performance from which
aggregated data and responses were provided to the
Chairman and then presented to the Board for discussion
and feedback.
The aggregated questionnaire results also provide the
basis of individual discussions between Directors and the
Chairman. The Chairman and each Board member consider
the performance of that Board member in relation to the
expectations for that Board member and consider any
opportunities for enhancing future performance.
During the reporting period, performance evaluations of the
Board, its Committees and individual Directors were carried
out in accordance with this process.
Legal, regulation and compliance
83%
Senior executive or Board level experience
in compliance and knowledge of legal and
regulatory requirements.
Risk management and audit
87%
Senior executive or Board level experience in
identification, management and oversight of
material corporate risks and audit, including
ability to monitor risk and compliance.
WHS, human resource management
and remuneration
90%
Board remuneration committee membership
or Senior executive experience relating
to workplace health and safety, diversity
and inclusion, managing people and
remuneration, including incentive
arrangements and the legislative framework
governing employees and remuneration.
Board Committees
The Board is assisted in carrying out its responsibilities by the
Audit & Risk Committee and the Remuneration & Nomination
Committee. Each Committee has its own written Charter*,
which is reviewed on an annual basis and is available on
the Company’s website.
The Directors’ Report at page 47 sets out the number of
Board and Committee meetings held during the 2022
financial year under the heading “Meetings of Directors”,
as well as the attendance of Directors at those meetings.
42
Governance Seven West Media Limited Annual Report 2022 Assessment of Management Performance
The performance of the Managing Director & Chief Executive
Officer is formally reviewed by the Board against the
achievement of strategic and budgetary objectives in respect
of the Group’s operations and investments whilst also having
regard for his personal performance in the leadership of the
Group. The Board’s review is carried out annually in regard to
certain goals against which he is assessed, and throughout
the year in regard to others, and forms the basis of the
determination of the Managing Director & Chief Executive
Officer’s performance-linked remuneration.
The performance of senior executives of the Company is
reviewed on an annual basis in a formal and documented
interview process with either the Managing Director
& Chief Executive Officer or the particular executive’s
immediate superior. Performance is evaluated against
agreed performance goals and assessment criteria in
relation to the senior executive’s duties and material areas
of responsibility, including management of relevant business
units within budget, motivation and development of staff,
and achievement of and contribution to the Company’s
objectives.
A performance evaluation of the Managing Director &
Chief Executive Officer and other senior executives took
place during the year in accordance with this process.
Core Values
In accordance with its Charter, the Board has reviewed and
approved the core values of the Company which function as
guiding principles and expectations for behaviour and the
culture the Board and Management are seeking to embed
across all businesses within the Group as follows:
> Be Brave
> Better Together
> Make it Happen
Diversity and Inclusion
The Board recognises the benefits of a workplace culture
that is inclusive and respectful of diversity. The Board
values diversity, including in relation to age, gender, cultural
background and ethnicity and recognises the benefits it
can bring to the organisation. The Board has adopted a
Diversity Equity and Inclusion Policy* that sets out the Board’s
commitment to working towards achieving an inclusive and
respectful environment. Please refer to pages 28 to 29 of this
Annual Report for reporting on the Diversity Policy and the
measurable objectives and initiatives relating thereto.
Code of Conduct and other
Company policies
The Board has adopted a Code of Conduct for Directors*
which establishes guidelines for their conduct in matters such
as ethical standards and the disclosure and management
of conflicts of interests. The Company has adopted a Code
of Conduct for Employees* which provides a framework of
ethical principles for conducting business and dealing with
customers, employees and other stakeholders.
Material breaches of the Codes of Conduct for Directors
and Employees are reported to the Board.
The Board has implemented a number of other policies and
procedures to maintain confidence in the Company’s integrity
and promote ethical behaviour and responsible decision
making, including the following:
> Continuous Disclosure policy*
> Share Trading policy*
> Group Editorial policy*
> Diversity Equity and Inclusion Policy*
> Whistleblower policy*
> Fraud, Anti-Bribery and Corruption Policy*
> Modern Slavery Statement*
Communications with security holders
As disclosed in the Shareholder Communication Policy*, the
Board aims to ensure that security holders are informed of
all major developments affecting the Company’s state of
affairs and that there is an effective two-way communication
with its security holders facilitated via the Company’s
Investor Relations function. Shareholders are encouraged
to participate in general meetings and are invited to put
questions to the Chairman of the Board in that forum.
Security holders are given the option to receive
communications from, and to send communications to,
the Company electronically to the extent possible. It is
the Company’s policy that all substantive resolutions at a
meeting of security holders are decided by a poll rather than
by a show of hands.
The Company’s website www.sevenwestmedia.com.au
provides various information about the Company.
Risk oversight and management
The Board requires Management to design and implement
a risk management and internal control system to manage
the Group’s material business risks and report to it on the
management of those risks. The Board also believes a sound
risk management framework should be aimed at identifying
and delivering improved business processes and procedures
across the Group which are consistent with the Group’s
commercial objectives.
43
Risk Management Policy
Material risks
The Board has adopted a Risk Management Policy*. The
group-wide risk profile covers the key revenue, content,
product/technology and people risks of the Company and
is prepared by the Risk Assurance & Internal Audit function
in consultation with key executives across the business.
Throughout the year, the Audit & Risk Committee reviews with
management the group-wide risk profile and the success
of the risk mitigation strategies in order to satisfy itself that
management is operating within the risk appetite set by the
Board. External advice is obtained as appropriate. The key
risks identified by Management and mitigation actions in
place are regularly updated and reported to the Audit &
Risk Committee and periodically to the Board.
During the reporting period, Management reported to the
Board as to the effectiveness of the Company’s management
of its material business risks. The Board satisfied itself the
Company’s risk management framework continues to be
sound and effectively identifies potential risks.
Under the risk framework described above, the Company
has identified revenue, content, and product/technology
risks which it manages and mitigates. Each of the foregoing
material business risks is monitored and managed by
appropriate Senior Management within the Company.
Where appropriate, external advisers are engaged to assist
in managing the risk. More detail concerning these risks,
the Company’s economic sustainability risks and how it
manages those risks is set out under the headings “Risk
Management” and “Risk Management Framework” on pages
24 and 25 of this Annual Report. The Company does not
believe it has any material exposure to environmental risks.
The Company considers it has material exposure to social
risks associated with a pandemic, such as COVID-19. The
Company has assessed this exposure and sets out how it
manages these risks on pages 24, 25 and 43 of this Annual
Report. Commentary on the Company’s environmental and
human capital related initiatives as well as its community
engagement is provided on pages 26 to 35 of this Annual
Report.
Internal Control Framework –
Risk Assurance & Internal Audit
Strategy
The Company has established a Risk Assurance & Internal
Audit function to evaluate and improve the effectiveness
of the Company’s governance, risk management and
internal control processes. The Audit & Risk Committee
reviews and approves Risk Assurance & Internal Audit
plans and resourcing as well as monitors its independence,
performance and management’s responsiveness to its
findings and recommendations.
A specialist external Internal Audit firm has been appointed
to conduct the Company’s Internal Audit reviews under in-
house oversight. The Board considers that this appointment
provides an enhanced level of capability and technical
depth, which serves to embed a stronger risk and compliance
culture across the organisation whilst drawing on best
practice and knowledge across operational and emerging
issues. Additionally, efficiencies are gained by the externally
resourced Internal Audit function working closely with the
Group’s external auditor KPMG, to ensure audit efforts are
not duplicated and Internal Audit work can be relied upon.
The Company has continued its strategic focus on responding
rapidly to the challenges and opportunities in its marketplace.
For more information on the Company’s strategic framework
which underpins the Company’s economic sustainability
please refer to pages 4 and 5 of this Annual Report.
Environment
Environmental risks are considered as part of the Company’s
risk assessment processes. Environmental risks relating to the
use and storage of any hazardous materials are identified and
managed through regular inspections of business premises,
reviews of compliance and emergency procedures, and advice
from external consultants on environmental matters.
The Company is mindful of climate change and managing the
environmental impact of its operations. For more information
on the Company’s environmental practices and the Company’s
efforts to minimise the environmental footprint of its businesses,
please refer to pages 34 and 35 of this Annual Report.
44
Governance Seven West Media Limited Annual Report 2022 External Audit function
Remuneration
The Board considers that the attraction, retention and
motivation of its Directors and senior executives is of critical
importance in securing the future growth of the Company and
its shareholder returns.
The objective of the remuneration policy for Executive
employees is to ensure that remuneration packages properly
reflect the duties and responsibilities of the employees,
and that remuneration is at an appropriate but competitive
market rate which enables the Company to attract, retain and
motivate people of the highest quality and with the best skills
from the industries in which the Company operates.
The aggregate remuneration for Non-Executive Directors is
approved by shareholders. Fees for Directors are set out in
the Remuneration Report on pages 50 to 70.
Hedging Policy
It is the Company’s policy that employees (including Key
Management Personnel (“KMP”)) are prohibited from dealing
in Seven West Media securities if the dealing is prohibited
under the Corporations Act. Therefore, in accordance
with this policy, all KMP are prohibited from entering into
arrangements which operate to limit the executives’ economic
risk in connection with Seven West Media securities which
are unvested or remain subject to a holding lock.
This Corporate Governance Overview and the Corporate
Governance Statement, which is available in the “Corporate
Governance” section of the Company’s website at www.
sevenwestmedia.com.au/about-us/corporate-governance,
have been approved by the Board and are current as at
16 August 2022.
The Audit & Risk Committee meets periodically with the
External Auditors without management being present.
Each reporting period, the External Auditor provides an
independence declaration in relation to the audit. Additionally,
the Audit & Risk Committee provides advice to the Board in
respect of whether the provision of non-audit services by the
External Auditor are compatible with the general standard of
independence of auditors imposed by the Corporations Act.
The Company’s External Auditor attends all Annual General
Meetings and is available to answer shareholders’ questions
about the conduct of the audit and the preparation and
content of the Auditor’s report.
Declarations by the Managing Director
& Chief Executive Officer and Chief
Financial Officer
Before the Board approves the financial statements for
each of the half year and full year, it receives from the
Managing Director & Chief Executive Officer and the Chief
Financial Officer a written declaration that, in their opinion,
the financial records of the Company have been properly
maintained and the financial statements are prepared in
accordance with the relevant accounting standards and
present a true and fair view of the financial position and
performance of the consolidated group. These declarations
also confirm that these opinions have been formed on the
basis of a sound system of risk management and internal
compliance and control which is operating effectively.
The required declarations from the Managing Director
& Chief Executive Officer and Chief Financial Officer have
been given for the half year ended 25 December 2021
and the financial year ended 25 June 2022.
Verification of Integrity of Periodic
Corporate Reports
Corporate reports which are not audited or reviewed by
the external auditor are prepared by Senior Executive
Management by reference to company records and systems,
with external professional assistance where appropriate.
Such reports, as are included in the non-audited sections
of this Annual Report, are submitted to a Committee or the
Board for consideration.
45
Directors’ Report
For the year ended 25 June 2022
The Directors present their report together with the
consolidated financial statements of the Group consisting
of Seven West Media Limited and the entities it controlled
at the end of, or during, the year ended 25 June 2022 and
the auditor’s report thereon.
Board
The following persons were directors of Seven West Media
Limited during the whole of the financial year and up to the
date of this report, unless otherwise stated:
> Kerry Stokes AC, Chairman & Non-Executive Director
> James Warburton, Managing Director &
Chief Executive Officer
> John Alexander, Non-Executive Director
> Teresa Dyson, Non-Executive Director
> David Evans, Non-Executive Director
> Colette Garnsey OAM, Non-Executive Director
> Michael Malone, Non-Executive Director
> Ryan Stokes AO, Non-Executive Director
> Michael Ziegelaar, Non-Executive Director
Particulars of their qualifications, experience, special
responsibilities and any directorships of other listed
companies held at any time in the last three years are
set out in this Annual Report under the headings “Board
of Directors” and “Corporate Governance Overview”
on pages 36 to 45 and form part of this report.
Warren Coatsworth is the Company Secretary. He was
appointed to the role on 24 April 2013. Mr Coatsworth is a
solicitor holding a current practising certificate with degrees
in Arts and Law (Hons) from the University of Sydney. He
holds a Masters of Law in Media and Technology Law from
the University of New South Wales as well as a Graduate
Diploma in Applied Corporate Governance. He is a qualified
Chartered Company Secretary and a Fellow and member
of the Governance Institute of Australia.
Mr Coatsworth has been Company Secretary of Seven Group
Holdings Limited since April 2010 and Company Secretary
of Seven Network Limited since July 2005. He has extensive
experience as Legal Counsel at the Seven Network advising
broadly across the company and was formerly a solicitor
at Clayton Utz. Mr Coatsworth was included on Doyles
Guide’s list of Leading In-House Technology, Media &
Telecommunications Lawyers in Australia for 2016 and 2017.
Principal activities
The principal activities of the Group during the financial year
were free to air television broadcasting, digital streaming and
newspaper publishing.
Business strategies, prospects and
likely developments
Information on the Company’s operations and the results of
those operations, financial position, business strategies and
prospects for future financial years has been included in the
“Group Performance” section starting on page 11. The Group
Performance section also refers to likely developments in
the Company’s operations in future financial years and the
expected results of those operations.
Information in the Group Performance section is provided to
enable shareholders to make an informed assessment about
the operations, financial position, business strategies and
prospects for future financial years of the Group.
Significant changes in the state of affairs
In October 2021, the Company refinanced its $600 million
secured syndicated debt facility agreement with maturity
extended to October 2024. The funding costs are at 2.25
per cent above BBSY, which is half the funding costs under
the previous facility. The new facility is also revolving,
which will require SWM to hold less cash on balance sheet,
further reducing interests costs. Under the terms of the new
debt facility agreement, the previous minimum liquidity
requirements and minimum EBITDA test were replaced by
semi annual total leverage ratio and total interest cover
tests. The Group has been in compliance with its financial
covenants to date, including the period ended 25 June 2022.
In December 2021, the Company completed its acquisition
of 100 per cent of the issued share capital of Prime Television
(Holdings) Pty Limited and its subsidiaries, and Seven
Affiliate Sales Pty Limited (Prime) from PRT Company Limited
(formerly Prime Media Group Limited). Consideration of
$124.2 million was paid by the Company, and a further $5.6
million of transaction costs have arisen from the acquisition.
In the opinion of the Directors, there were no other significant
changes in the state of affairs of the Company that occurred
during the financial year.
46
Directors’ Report Seven West Media Limited Annual Report 2022 Current year performance
For the year ended 25 June 2022 the Group recorded Earnings
Before Interest and Tax (EBIT) (and before significant items) of
$309.0 million. The statutory profit after tax was $211.1 million
(including significant items). The FY22 net operating cash
inflows were $160.2 million.
Further information is provided in the Review of Operations
on pages 13 to 23.
Matters subsequent to the end of the
financial year
Subsequent to year end, the Group has announced a 10 per
cent on-market share buyback to commence in August 2022.
There are no other matters or circumstances which have
arisen since the end of the financial year which have
significantly affected or may affect:
a. the Group’s operations in future financial years;
b. the results of those operations in future financial years; or
c. the Group’s state of affairs in future financial years.
Meetings of Directors
The number of meetings of the Company’s Board of Directors and of each Board Committee held during the year ended
25 June 2022, and the numbers of meetings attended by each Director were:
Directors
Kerry Stokes AC
John Alexander
Teresa Dyson
David Evans
Colette Garnsey OAM
Michael Malone
Ryan Stokes AO
James Warburton
Michael Ziegelaar
Meetings
of Directors
Audit
and Risk
(a)
(b)
(a)
8
8
8
8
8
8
8
8
8
8
8
8
7
8
8
8
8
8
10
10
10
10
(b)
1
10
9
3
9
9
10
10
Remuneration
and Nomination
(a)
(b)
6
6
6
6
6
1
5
6
1
6
5
1
a. Number of meetings held during the year while the person was a Board or Committee member.
b. Number of meetings attended. Please note Directors may attend meetings of Committees of which they are not a formal
member, and in these instances, their attendance is also included above.
Performance rights and options
During the financial year, there were not any rights issued over an equivalent number of unissued fully paid ordinary shares in
the Company.
At the date of this report, the following rights to acquire an equivalent number of ordinary shares in the Company under the
various employee equity schemes are outstanding:
Share Plan
Seven West Media Equity Incentive Plan (2020 LTI)
Seven West Media Equity Incentive Plan (2021 LTI)
Seven West Media Equity Incentive Plan (2021 STI)
Seven West Media Equity Incentive Plan (2022 LTI)
Seven West Media Equity Incentive Plan (2022 STI)
Seven West Media Equity Incentive Plan (2023 STI)
Rights on Issue
Expiry Date
2,543,530
31 August 2023
22,968,748
31 August 2024
51,420,711
31 August 2022
6,588,597
31 August 2025
10,454,959
31 August 2023
10,870,406
31 August 2024
Rights were granted for nil consideration. None of the rights currently on issue entitle the holder to participate in any share issue.
During the financial year, 53,964,242 rights vested and 367,685 rights lapsed.
There are no other unissued shares or interests under options as at the date of this report.
47
For names of the Directors and Key Management Personnel who currently hold rights through these schemes, refer to the
Remuneration Report.
Dividends – Seven West Media Limited
Dividends paid to members during the financial year were as follows:
Final ordinary dividend for the year ended 26 June 2021: nil cents (2020: nil cents)
Interim ordinary dividend for the year ended 25 June 2022: nil cents (2021: nil cents)
2022
$
–
–
2021
$
–
–
In addition to the above dividends, since the end of the 2022 financial year, the Directors have declared the payment of a final
ordinary dividend of nil cents per share.
Environmental regulation
The Group’s major production facilities do not require discharge licences under the Environmental Protection Act 1986 and no
formal reporting is required to either the Environmental Protection Authority or the National Pollutant Inventory.
Greenhouse gas and energy data reporting requirements
The Group continues to measure and monitor its Greenhouse Gas emissions under the National Greenhouse and Energy
Reporting Act (2007). The Group is actively working towards reduction of direct emissions from the consumption of fuels
(Scope 1) and indirect emissions from electricity consumption (Scope 2) reportable under NGER, as well as Scope 3 voluntary
emissions where possible and practical for the business units.
There are no other particular and significant environmental regulations under the law of the Commonwealth or of a State or
Territory for the Group.
Directors’ interests in securities
The relevant interests of each Director in shares and rights issued by the Company, as notified by the Directors to the ASX
in accordance with S205G(1) of the Corporations Act 2001, at the date of this report are as follows:
Kerry Stokes AC
James Warburton
John Alexander
Teresa Dyson
David Evans
Colette Garnsey OAM
Michael Malone
Ryan Stokes AO
Michael Ziegelaar
Performance
Rights
Number of
ordinary shares
–
621,453,734
16,463,179*
11,250,000
–
–
–
–
–
–
–
55,768
117,720
1,397,803
425,000
233,000
240,466
10,000
* Performance Rights for Mr Warburton includes 2,165,775 rights granted to Mr Warburton under the FY22 STI Plan based on
his out-performance during FY22. FY22 STI was approved by shareholders at the 2021 Annual General Meeting.
48
Directors’ Report Seven West Media Limited Annual Report 2022 Remuneration Report
A Remuneration Report is set out on the pages that follow
(pages 50 to 70) and forms part of this Directors’ Report.
Indemnity and insurance of directors
and officers
The Constitution of the Company provides an indemnity
to any current and former Director, Alternate Director and
Secretary of the Company against any liabilities incurred
by that person arising out of the discharge of duties as an
officer of the Company or the conduct of the business of
the Company, including associated legal costs defending
any proceedings relating to that person’s position with the
Company, except where the liability arises out of conduct
involving a lack of good faith.
As permitted by the Constitution of the Company, the
Company has entered into Deeds of Access, Insurance
and Indemnity with each Director as at the end of the
financial year.
No amounts were paid and no actions were taken pursuant
to these indemnities during the year.
> the non-audit services provided do not undermine the
general principles relating to auditor’s independence
as set out in APES 110 Code of Ethics for Professional
Accountants, as they did not involve reviewing or auditing
the auditor’s own work, acting in a management decision
making capacity for the Group, acting as an advocate of
the Group or jointly sharing the risks and rewards.
The Lead auditor’s independence declaration is set out
on page 71 and forms part of the Directors’ Report for the
financial year ended 25 June 2022.
Rounding of amounts
The Group is of a kind referred to in ASIC Instrument
2016/191 and in accordance with that Instrument, amounts in
the consolidated financial statements and Directors’ Report
have been rounded off to the nearest one thousand dollars
unless otherwise stated.
This report is made in accordance with a resolution of the
Directors.
During the financial year, the Company paid a premium
in respect of a contract insuring all Directors and officers
(including employees) of the Company and of related bodies
corporate against certain liabilities specified in the contract.
The contract prohibits disclosure of the nature of the liabilities
insured and the amount of the premium.
Kerry Stokes AC
Chairman
Sydney
16 August 2022
Non-audit services
The Company may decide to employ the auditor on
assignments additional to their statutory audit duties where
the auditor’s expertise and experience with the Company
and/or the Group are important.
Amounts paid or payable by the Group to the auditor,
KPMG, for non-audit services provided during the year were
$823,418. The Board of Directors has considered the position
and, in accordance with the advice received from the Audit
and Risk Committee, is satisfied that the provision of the
non-audit services is compatible with the general standard of
independence for auditors imposed by the Corporations Act
2001. The Directors are satisfied that the provision of non-
audit services by the auditor did not compromise the auditor
independence requirements of the Corporations Act 2001
for the following reasons:
> all non-audit services were subject to the corporate
governance procedures adopted by the Group and
have been reviewed by the Audit and Risk Committee
to ensure they do not impact the integrity and objectivity
of the auditor;
49
Reissued – Remuneration Report
Message from the Remuneration & Nomination Committee Chairman
Dear Shareholder
On behalf of the Seven West Media Board, we present the
Remuneration Report for the 2022 financial year (FY22) for
the year ended 25 June 2022.
This report is a reissuance of the report approved on 16
August 2022 and included in the lodged 2022 Annual Report.
The report is being reissued as it has been identified that
the information provided by external specialist consultants,
Ernst & Young, and relied upon by the Group in determining
the vesting of the FY20 LTI Grant was incorrect. The
corrected FY20 LTI TSR testing data has determined that
the performance hurdle was not achieved and therefore, no
performance rights will vest. Updates to the Remuneration
Report for this change have been highlighted in yellow for
ease of reference for users.
FY22 was a standout year for Seven West Media with
significant ratings achievements and earnings growth. Seven
is Australia’s #1 total television company, strengthened by our
acquisition of the assets of Prime Media Group in December
2021. Our strategy of investing in premium content continues to
deliver audience consistency and strength. Seven was the only
network to grow audience share during the financial year and
7plus has maintained its place as the #1 BVOD service.
Our ongoing success as an organisation and ability to
deliver positive outcomes for all our stakeholders relies on
the commitment and excellence of our people to identify
new opportunities and manage risk. As such, it is critical
that we attract, motivate and retain exceptional people.
In March 2022, Seven West Media became the first media
company in Australia to be awarded a citation as Employer of
Choice for gender equality by the Workplace Gender Equality
Agency (WGEA). The criteria for the citation are rigorous
and we were one of just 12 companies across Australia to
be added this year as an employer having achieved gender
equality in the workplace. Seven’s commitment to diversity,
equity and inclusion will continue and is demonstrated in our
first comprehensive Sustainability Report.
We remain guided by our core values and purpose, “To bring
all Australians closer to the moments that move us”. This is
demonstrated through our best-in-class coverage of metro
and regional news, public affairs, sport and our leading
entertainment tentpole programs.
Overview of Performance Outcomes
FY22 was another exceptional year for Seven West Media
with strong financial results:
> EBIT was $309.0 million and earnings before interest,
tax, depreciation and amortisation (EBITDA) was
$342.2 million, up from $253.9 million in FY21 and
$123.4 million in FY20;
> Statutory operating cash inflow increased to
$160.2 million, compared to FY21 of $143.2 million;
> Statutory net profit after tax (NPAT) was down by
33.7 per cent compared to FY21 as a result of FY21
significant items. Significant item benefits including
tax of $10.3 million compares to FY21 significant item
benefits including tax of $192.6 million;
> Revenue of $1.5 billion was 21.2 per cent higher
compared to FY21 (in an advertising market up 8.7%);
> Earnings per share (EPS) of 13.3 cents per share was
down by 35.7 per cent compared to the prior year; and
> Return on capital employed was 31.5 per cent up
38.5 percentage points from FY21.
Our three strategic pillars established in FY20 to deliver
our long-term strategy continued to be relevant and
critical to the ever-changing external environment.
1. Content-Led Growth – During the year:
> We reclaimed ratings leadership in 2021 and
have grown audience share in 2022 to maintain
this leadership.
> 7plus was #1 in BVOD for the second year in a row.
BVOD consumption continued to grow strongly with
over 12.5 million registered, verified users on 7plus and
an 61.3 per cent increase to total minutes streamed.
> Our partnerships with Google and Facebook are
supporting our investment in innovation and digital
capabilities for our Group. The partnerships are a
significant step forward for Australian news media
and are a clear acknowledgement by all parties of the
value and importance of original news and content.
> Our newspaper operations, with 32 titles and market-
leading digital sites across city and regional areas in
Western Australia, further dominate the market. The
expansion of The West’s digital assets continues to
attract a younger audience.
2. Transformation – The continued push to maintain costs
has been critical in delivering a sustainable business over
the long term.
> We continued our digital focus with the relaunch of
7NEWS.com.au and new digital priorities have been
set for FY23.
> The acquisition of the assets of Prime Media Group
created a significant opportunity to operate the
combined business more efficiently and extend our digital
presence in regional markets, particularly for 7plus and
7NEWS.com.au. Both have already started generating
new registered users and are driving new revenue.
> Costs have come in below target at $1.2 billion
including second half impact of the Prime Media
Group transaction.
50
Reissued – Remuneration Report Seven West Media Limited Annual Report 2022 3. Capital Structure and M&A –Seven’s strong recent
– Pro-rata vesting between 50 per cent and
performance has resulted in a significant improvement
in financial results and its debt position.
85 per cent where ATSR CAGR is greater than
10 per cent but less than 15 per cent;
> The Group’s debt facility was refinanced in October
– 85 per cent for ATSR CAGR performance of
2021 for a further three years, at a significant
improvement in cost of funding and on more flexible
terms. This refinanced facility will allow the Group
flexibility to achieve its strategic objectives.
> The acquisition of Prime Media Group in December
2021 has given us direct access to Australia’s
largest regional audience reaching over 91 per cent
of Australians. As a result, Seven is the undisputed
national total television market leader, that is, in
metro, regional and BVOD markets.
> The improved balance sheet has enabled the
Company to resume capital management initiatives
for the first time since 2017.
Overview of FY22 Executive Remuneration
and Performance Outcomes
> Fixed Remuneration – There were no remuneration
increases to Executive Key Management Personnel (KMP)
and Non-Executive Directors during the year.
> Short-Term Incentive (STI) Plan – The Company’s
underlying EBIT result exceeded the 100 per cent
target range set by the Board at the commencement of
FY22, and the STI gateway opened fully. Participants
received 50 per cent of their potential award granted
as performance rights on a prospective basis at the
commencement of the performance year. Following
assessment at the end of the performance year, 50 per
cent of the final award is payable as cash (in Q1 of FY23)
and the remaining 50 per cent as shares (reflecting the
moderated percentage of performance rights that vested
for each participant based on their performance in FY22).
Vested shares are subject to a 12-month deferral period.
Further details of the FY22 STI Plan are provided in Section 6
of the Report.
> Long-Term Incentive (LTI) Plan – The FY20 grant
reached the end of its three-year performance period
on 25 June 2022. The Award was tested against relative
TSR performance which did not meet the performance
hurdle and therefore, did not vest. All performance
rights lapsed.
Following the AGM in November 2021, Performance Rights
under the FY22 LTI Plan were granted to the MD & CEO
and other Executive KMP with the key features being:
a. An Absolute Total Shareholder Return Compound
Annual Growth Rate (ATSR CAGR) performance
hurdle over a three-year vesting period with a further
12-month deferral period; and
b. A performance-based vesting schedule of:
– 50 per cent for ATSR CAGR performance of
10 per cent;
15 per cent;
– Pro-rata vesting between 85 per cent and 100 per
cent where ATSR CAGR is greater than 15 per cent
but less than 20 per cent; and
– 100 per cent for ATSR CAGR performance equal to
or greater than 20 per cent.
Further details of the FY22 LTI Plan are provided in Section 6
of the Report.
There were no other material changes to the remuneration
framework or terms and conditions of KMP during 2022.
Managing Director & Chief Executive Officer
(MD & CEO) Remuneration
> Fixed Remuneration – Mr Warburton’s base
remuneration has remained unchanged since his
appointment in August 2019.
> FY22 STI Outcome – Mr Warburton’s leadership has
led to another strong set of financial and non-financial
results, with the MD & CEO meeting and exceeding the
stretch targets set by the Board at the commencement
of the financial year. After careful consideration, the
Board determined in its absolute discretion to grant
Mr Warburton an STI award of 150 per cent of Maximum
(100 per cent of Target) for FY22. 50 per cent of this
award is delivered as cash and 50 per cent as shares
(converted from prospectively granted performance
rights) and is subject to a 12-month deferral period.
> FY20 LTI Outcome – With shareholder approval at the
AGM in November 2021, Mr Warburton’s participation in
this Plan was cancelled and he subsequently received no
outcome under this Plan.
> FY21 and FY22 LTI Grants – Mr Warburton was granted
Performance Rights equivalent to 100 per cent of his Total
Employment Remuneration (TER) pursuant to his contract
and subject to performance hurdles set by the Board and
the conditions specified within the Plan Rules.
At the 2021 Annual General Meeting, the Company sought
shareholder approval in accordance with ASX Listing Rule
10.14 for the issue of securities to Mr Warburton under
the FY21 STI Grant. For the FY22 STI Grant, it is currently
intended that securities will be acquired on market to satisfy
any Performance Rights that vest.
Mr. Warburton’s FY21 and FY22 remuneration is tabled at
Sections 5 and 7 of the Report.
51
Outlook and Changes for 2023
Our Group’s strategy to focus on content-led growth
and market-leading digital assets will play a major role
in adapting to the ever-changing content consumption
habits of people across all demographics. This growth
will be balanced by an ongoing focus on cost management
and operational efficiencies, as well as capital management
initiatives.
During the year, the Board considered and resolved to
introduce a Non-Executive Director Share Plan effective
1 July 2022. This provides Non-Executive Directors with
the opportunity to sacrifice up to 50 per cent of their
annual Board and Committee fees towards the purchase
of Company shares.
The introduction of this Plan will establish a governed and
transparent process for new and existing Non-Executive
Directors to meet their obligations under the Minimum
Shareholding Policy. When considered alongside the
deferred equity component of our STI and LTI plans, and
the Share Purchase Plans offered to employees, the Board
believes there is a strong sense of engagement and advocacy
within the Company and a continued positive alignment
between the interests of shareholders and our people.
The Board will seek approval of the Non-Executive Director
Share Plan at the 2022 Annual General Meeting (AGM).
While we are generally satisfied that the current remuneration
framework is still aligned to our business strategy and is
delivering the desired result in terms of remuneration levels,
the Board will commence its review of LTI arrangements for
the FY2024 performance year.
Thank you for your ongoing support of Seven West Media.
I look forward to receiving your views and support at the
2022 AGM.
Yours faithfully
John Alexander
Remuneration & Nomination Committee Chairman
Table of Contents
Remuneration Report 2022 – Audited
1
Introduction
2 FY22 Key Management Personnel Covered
by this Report
3 Executive Remuneration at a Glance
4 Remuneration Governance
4.1 Role of the Remuneration and
Nomination Committee
4.2 Members of the Remuneration and
Nomination Committee During FY22
4.3 Services from External Remuneration Consultants
4.4 Security Trading Policy Headging Prohibition
5 Executive Remuneration Outcomes
During the FY22 Performance Year
5.1 Executive Remuneration Earned and Vested
(Voluntary Disclosure)
5.2 Summary of STI Outcomes
5.3 Deferred Remuneration Granted to the
MD and CEO and Executive KMP
5.4 Summary of LTI Outcomes
53
53
53
55
56
6 Executive Remuneration Details: Composition
of Executive Remuneration and Application of
Remuneration Principles
6.1 Executive Remuneration Framework
6.2 Link Between Remuneration Policy and
Company Performance
6.3 Executive Service Agreements
6.4 Non-Executive Director Remuneration
Framework
7 Statutory Remuneration Disclosures for
Key Management Personnel
7.1 Executive Remuneration in Detail
(Statutory Disclosures)
7.2 Non-Executive Remuneration in Detail
7.3 Key Management Personnel Equity
Transactions and Holdings
8 Loans and Other Transactions with
Key Management Personnel
59
66
70
52
Reissued – Remuneration Report Seven West Media Limited Annual Report 2022
1. Introduction
This Report describes the remuneration arrangements for the Key Management Personnel (KMP) of Seven West Media Limited
as defined in AASB 124 Related Party Disclosures, including Non-Executive Directors, the Managing Director and Chief
Executive Officer (MD and CEO), and other Executives (including Executive Directors) (hereafter referred to in this Report as
Executive KMP) who have authority for planning, directing and controlling the activities of the Group. The KMP for the financial
year are set out below.
The information provided in this Remuneration Report has been audited as required by section 308(3C) of the Corporations
Act 2001 (Cth). It forms part of the Directors’ Report.
2. FY22 Key Management Personnel Covered by this Report
The KMP whose remuneration is disclosed in this year’s Report are:
KMP
Non-Executive Directors (NEDs)
KM Stokes AC
JH Alexander
T Dyson
D Evans
C Garnsey OAM
M Malone
RK Stokes AO
M Ziegelaar
Position
Chairman
Director
Director
Director
Director
Director
Director
Director
Managing Director and Chief Executive Officer (MD and CEO) and Executive KMP
J Warburton
KJ Burnette
J Howard
KA McGrath
BI McWilliam
MD and CEO
Chief Revenue Officer
Chief Financial Officer
Chief People and Culture Officer
Commercial Director
3. Executive Remuneration at a Glance
Key Features
Details of Seven West Media’s Approach
Term as KMP
Full Year
Full Year
Full Year
Full Year
Full Year
Full Year
Full Year
Full Year
Full Year
Full Year
Full Year
Full Year
Full Year
Executive Remuneration in FY22
1. How is Seven West Media’s
performance reflected in this
year’s remuneration outcomes?
2. What changes have been
made to the remuneration
framework in FY22?
Seven’s remuneration outcomes are strongly linked to the delivery
of sustainable shareholder value over the short and long-term.
> Short-Term Incentive (STI): The Company’s underlying Earnings
Before Interest and Tax (EBIT) result for FY22 exceeded the 100 per cent
range of budget and the STI gateway opened.
> Long-Term Incentive (LTI): The FY20 LTI Plan reached the end of
its three-year performance period on 25 June 2022. Based on the
Company’s relative Total Shareholder Return (RTSR) performance
not exceeding the nominated index, 0% of the performance rights vested.
Fixed remuneration levels for Executive KMP remain unchanged and there
were no changes to the overall remuneration framework for Executive KMP.
A Minimum Shareholding Policy was introduced effective 1 July 2021, with
Non-Executive Directors and Executive KMP given 5 years from the date
of inception (or their appointment) to achieve the prescribed shareholding
level. Also, the Board reviewed and adjusted the threshold, target and
stretch performance levels applicable to both STI and LTI Plan granted
during the year to ensure continued alignment to Company strategy and
to set objectives that, if achieved, represent significant value creation for
investors and stakeholders.
3. Are any changes planned for FY23? Yes. A new Non-Executive Director Share Plan will be introduced
effective 1 July 2022, providing Directors with the opportunity to sacrifice
up to 50 per cent of their annual Board and Committee fees towards the
acquisition of Company shares. The Board will undertake a review of
the future LTI grants in respect of appropriate performance measures.
Further
Information
Section 5
Pages 56–59
Section 6
Page 59–65
Section 6
Pages 59–65
Section 6
Pages 59–65
53
Key Features
Details of Seven West Media’s Approach
Executive Remuneration Framework
4. What is Seven West Media’s
remuneration strategy relative
to the market?
Fixed and variable remuneration strategy is aimed at the median of the
market, with remuneration opportunities for outstanding performance
extending to the upper quartile of the market.
5. What proportion of remuneration
is “at risk”?
6. Are there any claw-back
provisions for incentives?
Short-Term Incentives (STI)
7. Are any STI payments deferred?
Executive KMP remuneration is broadly evenly distributed between
fixed remuneration and on performance which is therefore ‘at risk’
> MD and CEO: 66.7 to 71.4 per cent at risk.
> Executive KMP: Remuneration package range between
43 to 60 per cent at risk.
Yes. If there is a material financial misstatement, any unvested LTI or
deferred STI awards can be clawed back.
Yes. 50 per cent of annual STI potential for Executive KMP is prospectively
granted as Performance Rights. Upon assessment at the end of the
performance year, a percentage of the Performance Rights may vest and
convert to shares. Performance Rights that do not vest are forfeited. Vested
shares are then subject to a deferral period of 12 months during which time
they cannot be traded. However, shares are deemed to be released
unless the Board determines that a different treatment applies.
Further
Information
Section 6
Page 60
Section 6
Page 60
Section 6
Page 63
Section 6
Page 61
8. Are STI payments capped?
Yes. STI opportunity is capped as follows:
> MD and CEO: STI is capped at 150 per cent of fixed remuneration
Section 6
Page 61
(maximum opportunity).
> Executive KMP: STI is capped at the STI target (at 100 per cent),
achievable only in circumstances of both exceptional individual and
Company performance.
Long-Term Incentives (LTI)
9. What are the performance
measures for the LTI?
For both the FY21 and FY22 LTI Plans, 100 per cent is subject to an Absolute
Total Shareholder Return Compound Annual Growth Rate (ATSR CAGR)
performance hurdle set by the Board for the three-year period from
commencement date. The Board retains discretion to ensure vesting
outcomes are appropriately aligned to performance.
Section 6
Pages 62–63
10. Are there any restrictions imposed
on disposal of LTI awards?
Yes. There is a restriction imposed on the sale and use of shares after vesting
until the earliest of the following:
> The date the holder ceases employment with Seven West Media
Section 6
Page 63
(subject to approval by the Board);
> The one-year anniversary of the vesting date (or subsequent
anniversaries if elected by the award holder); or
> The Board determines that the holding lock should be released.
The Board has ultimate discretion to determine otherwise.
11. Does the LTI have re-testing?
No. There is no re-testing.
12. Are dividends paid on unvested
LTI awards?
No. Dividends are not paid on unvested LTI awards. This ensures that
Executives are only rewarded when performance hurdles have been achieved
at the end of the performance period.
13. Is the size of LTI grants increased
No. There is no adjustment to reflect the performance conditions.
in light of performance conditions?
The grant price for allocation purposes is not reduced based on performance
conditions. Seven uses a ‘face value methodology’ for allocating Performance
Rights to each Executive KMP, being the volume weighted average price
(VWAP) of shares for the month leading up to grant.
14. Can LTI participants hedge
their unvested LTI?
No. Consistent with the Corporations Act 2001 (Cth), participants
are prohibited from hedging their unvested Performance Rights.
Section 6
Page 63
Section 6
Page 63
Section 6
Pages 62–63
Section 7
Pages 66–69
Section 4
Page 56
Section 6
Page 63
15. Does Seven West Media
buy shares or issue new shares
for share-based awards?
For both the deferred component of STI awards and LTI awards, the Board
has discretion to issue new shares or buy shares on-market. However, it is
currently the Board’s intention to settle share awards via on-market purchase.
Section 6
Pages 60–61
16. Does Seven West Media issue
share options?
No. Seven typically uses Performance Rights for the deferred component
of STI and LTI awards.
Section 6
Pages 61–63
Executive Service Agreements
17. What is the maximum an Executive
can receive on termination?
The Executive KMP termination entitlements are limited to six (6) months’
fixed remuneration.
Section 6
Page 64
54
Reissued – Remuneration Report Seven West Media Limited Annual Report 2022 4. Remuneration Governance
4.1 Role of the Remuneration and Nomination Committee
The primary objective of the Remuneration and Nomination Committee (the Committee) is to assist the Board to fulfil its
corporate governance and oversight responsibilities to ensure that remuneration policies and structures are fair, competitive
and are aligned with the long-term interests of the Company. These include our people strategy, remuneration components,
performance measurements and accountability frameworks, recruitment, engagement, retention, talent management and
succession planning.
The table below outlines the roles and responsibilities of the Board, the Committee and management in relation to Board
and Executive KMP remuneration.
Board
Remuneration and
Nomination Committee
Management
> Approves remuneration arrangements
and conditions of service for the
MD and CEO, Executive KMP and
Non-Executive Directors.
> Monitors the performance of
Executive management.
> Recommends remuneration and
incentive policies, structures and
practices.
> Recommends remuneration
arrangements for the MD and CEO
and Executive KMP.
> Retains discretion in determining the
> Undertakes an annual review of the
overall outcome of the incentive awards
or adjust remuneration to ensure it is
consistent with, and appropriately
reflects the Group performance and of
the individual Executive experience over
the relevant performance period.
Company’s remuneration strategy and
Remuneration Policy.
> Reviews executive remuneration
arrangements or Executive KMP and
Non-Executive Directors on an annual
basis against the Remuneration
Policy, obtaining independent external
remuneration advice where appropriate.
> Reviews and recommends the
Remuneration Report and any other
report required to be produced
for shareholders to meet statutory
requirements.
> Prepares recommendations and
provides supporting information
for the Committee’s consideration.
> Implements approved remuneration-
related policies and practices.
> The MD and CEO assesses each
Executive’s performance at the end
of the financial year relative to agreed
business and individual targets. Based
on this assessment, the MD and CEO
makes a recommendation to the
Committee for approval.
The Committee has a strong focus on the relationship between business performance, risk management and remuneration.
During the year, the Committee met on six occasions and reviewed, approved or made recommendations to the Board
on matters including:
> Remuneration review for the MD and CEO and other senior Executives (broader than those disclosed in the
Remuneration Report) covered by the Company’s Remuneration Policy;
> Review of the STI Plan, LTI Plan and Employee Share Plans;
> The Company’s performance framework (objectives setting and assessment) and annual variable remuneration spend;
> Performance and remuneration outcomes for senior Executives;
> Approval of Executive KMP and other senior Executive appointments and terminations;
> The effectiveness of the Company’s Remuneration Policy;
> The introduction of the Non-Executive Director Share Plan;
> Succession plans for senior Executives; and
> Diversity, equity and inclusion, employee engagement, and health, safety and wellbeing.
The Committee reviews its Charter every financial year. The Corporate Governance Statement on pages 39 to 45 provides
further information on the role of the Committee.
55
5. Executive Remuneration Outcomes
During the FY22 Performance Year
5.1 Executive Remuneration Earned and Vested
(Voluntary Disclosure)
The purpose of this table is to provide shareholders with a
summary of the actual remuneration which has been received
by Executive KMP during FY22, and to show remuneration
received during FY21 for comparative purposes. The table
below has been prepared to supplement the statutory
requirements in Section 7 of the Report and shows:
> Fixed remuneration and the value of cash incentives
earned in respect of FY22 and FY21; and
> ‘At risk’ equity-based remuneration granted to Executive
KMP in prior years that vested during 2022 and 2021. The
final column shows the value of prior equity awards which
lapsed in 2022 (these awards reflect the FY20 LTI grant of
Performance Rights which did not meet the performance
hurdles when tested in July 2022).
> ‘At-risk’ STI award related to and vested in the FY22
performance year.
Both the cash and deferred components of the FY22 award
appear in this table, which have vested subject to a service
condition. Unlike the Statutory Disclosure table in Section
7, which has been prepared in accordance with Australian
Accounting Standards and discloses the value of STI and LTI
grants which may or may not vest in future years (i.e. reported
on an accounting basis), this table discloses the value of
equity awards from previous years which vested in FY22.
4.2 Members of the Remuneration and
Nomination Committee During FY22
During FY22, the members of the Remuneration and
Nomination Committee were:
> Mr JH Alexander, Chairman
> Mr D Evans
> Ms C Garnsey OAM
> Mr RK Stokes AO
4.3 Services from External Remuneration Consultants
External consultants and advisors are engaged as needed to
provide independent advice. The requirements for external
consultants’ services are assessed annually in the context of
remuneration matters that the Committee requires to address.
Recommendations provided by external consultants are used
as a guide.
During FY22, the Committee retained Ernst & Young (“EY”)
to provide an independent valuation for the 2022 LTI Award,
and to assess TSR performance for the Company’s FY20
LTI Plan. In the course of providing this information, the
Board is satisfied that EY did not make any remuneration
recommendations relating to KMP as defined by the
Corporations Act.
The Company employs in-house remuneration professionals
who provide recommendations to the Committee and the
Board. The Board made its decisions independently, using
the information provided and with careful regard to the
Company’s strategic objectives, risk appetite and the Seven
West Media Remuneration Policy and principles.
4.4 Security Trading Policy Hedging Prohibition
All deferred equity must remain ‘at risk’ until it has fully
vested. Accordingly, Executives and their associated persons
must not enter into any schemes that specifically protect
the unvested value of equity allocated. If they do so, then
they forfeit the relevant equity. These restrictions satisfy
the requirements of the Corporations Act which prohibits
hedging of unvested awards.
56
Reissued – Remuneration Report Seven West Media Limited Annual Report 2022 7 $
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57
5.2 Summary of STI Outcomes
How the Group’s Performance was assessed for the 2022 Financial Year
Under the design of the STI Plan, a pool may be available for distribution where the Group’s underlying EBIT threshold target
is met as set out in Section 6.1.2 of the Report. The framework provides a set of Key Performance Indicators (KPIs) which are
used to assess the quality of the outcomes delivered against the Group’s financial and non-financial strategic goals. For
FY22, the Company’s EBIT result of $309.0 million opened the STI financial gateway.
The individual KPIs and FY22 achievements as determined by the Remuneration and Nomination Committee for the MD and
CEO are provided in the following table.
Strategic
Pillar & Measure
Strategic
> Deliver on content and
cost agenda
> Accelerate 7plus, driving
data platform, rebuild and
scale ventures
> Lead industry consolidation
with continued M&A to better
position Seven
Weight
Performance Against Scorecard Targets
20%
> Won ratings for Total People in CY2021, the first time in three years
due to Seven’s underlying programming as well as The Ashes, Tokyo
Olympics and improvement to tentpole programs.
> 7plus has maintained its place as the #1 BVOD service for the
second year in a row.
> #1 ratings in Total People and BVOD to CY22 year-to-date; the only
network to grow share.
> Successful execution of the Company’s strategy, including the
acquisition of assets of Prime Media Group and multiple new venture
investments completed. Prime Media Group integration has been
completed.
> Successful implementation of Google and Facebook deals.
Financial
> Deliver Company EBITDA/EBIT
50%
> FY22 EBIT was $309.0 million and EBITDA was $342.2 million ($297
million and $326 million respectively, excluding Prime Media Group).
targets
> Generate net-free cash outflow
at or better than forecast
> Target asset sales completed
or well advanced
> Improve net debt
> Net cash outflow ~ $15 million, $9 million lower than budget;
absorbing Prime Media Group acquistion (net ~ $86 million in 2H22).
> Television revenue (including Prime) up 23.6 per cent year-on-year /
10 per cent v budget; 39.1 per cent share for FY22 (Metro 38 per cent,
BVOD 40 per cent, Prime 43.6 per cent and 7Qld 46.2 per cent).
> All Olympics objectives (i.e., audience, incremental revenue and net
contribution) met/exceeded; Beijing also delivered ahead of revenue
expectations.
> Company cost control maintained with full year costs below target
(adjusted for Prime Media Group acquisition).
> Net debt at $256 million during the year, including Prime Media
Group acquisition costs (-0.7 x EBITDA).
> Refinancing completed with optimised terms and pricing.
Outcome
Achievement
Significant
Over-
Achievement
Audience & Content
> Continue to implement ‘Audience
20%
> Returned to ratings leadership.
> 7REDiQ launched with Seven partnerships delivering incremental
Achievement
First Content’ approach
> Deliver greater year-round
profitable audience strength and
consistency, and competitive
ratings in tentpole strategy
> Maintain audience share for 7plus
> WAN digital audience metrics
at or above target
People, Operations & Compliance
> Achieve value-enhancing
outcomes from relevant
regulatory reviews
> Refresh risk management
framework and approach
> Effective management and
reporting of all risk and
compliance matters
> Improve safety of our workforce
> Drive high performing culture
and engagement
revenue and supporting growth in 7plus market share.
> 7plus revenue and audience outcomes ahead of target and
ahead of the market for the year.
> Revenue share to 39.1 per cent and growth in key advertiser
demographic in total people 25 to 54s and 16 to 39s.
> Seven is the most watched television nationally and in capital cities.
> 7News is the highest rating news service.
> AFL is the highest rating sport in FY22.
> WAN digital audience metrics continued to improve. (Neilsen DMR
combined audience for The West and Perth Now was 3.0 million,
ranked 9th nationally).
10%
> Delivered strong regulatory outcomes, including progress on prominence.
> Achieved outcome of the Media Reform Green Paper.
> Ongoing improvement in risk and compliance matters.
> Seven’s ESG strategy, framework and standalone public report is
Achievement
currently in development.
> Expanded our People Experience programs, driving a high-
performance culture and engagement.
> Ongoing improvement in safety performance.
> Achieved diversity, equity and inclusion targets including recognition
by WGEA as an Employer of Choice for gender equality.
> Launched the Company’s Reconciliation Action Plan (RAP)
ahead of schedule.
Total
100%
58
Over-
achievement
Reissued – Remuneration Report Seven West Media Limited Annual Report 2022 5.3 Deferred Remuneration Granted to the MD and CEO and Executive KMP
The table below presents the dollar value of equity granted under the STI and LTI Plans to the Executive KMP with respect
to FY22.
Name
J Warburton
KJ Burnette
J Howard
KA McGrath
BI McWilliam
FY22 Deferred
STI1
$
FY22 LTI2
$
Total
$
Financial Year
in which
Grant Vests
1,012,500
1,350,000
2,362,500
2023, 2024
312,500
308,100
131,250
275,000
312,500
487,500
131,250
275,000
625,000
795,600
262,500
550,000
2023, 2024
2023, 2024
2023, 2024
2023, 2024
1 100 per cent of the deferred award is recognised in the current performance year. Deferred equity under the STI Plan is not subject to any further
performance conditions except continued employment.
2 Subject to performance conditions and due to vest on 1 July 2024.
5.4 Summary of LTI Outcomes
The table below shows the vesting outcomes for the FY20 LTI grant to Executive KMP that reached the completion of the
performance period during FY22 based on the assessment conducted by EY (refer to section 4.3) in line with requirements of
the plan.
Performance Range
Performance
Measure
Performance
Start Date
Test Date
Threshold
Maximum
Outcome
% Vested
% Lapsed
Relative TSR
(100% of Award)
1 July 2019
30 June 2022
Greater
than Index
Outperform
index by at
least 10% or
more
TSR of 10.15% (ranked
at 3.58% below the
Comparator Index1)
0%
100%
1 S&P/ASX 200 Communication Services Accumulation Index.
Further details on the performance hurdles under the 2020 LTI Plan are found in the 2020 Remuneration Report.
6. Executive Remuneration Details
Composition of Executive Remuneration and Application of Remuneration Principles
Executive remuneration is determined by the Remuneration and Nomination Committee and, for the MD and CEO, is
recommended to the Board for its approval. Executive remuneration comprises both a fixed component and a variable
(or “at risk”) component which contains separate STI and LTI elements. These components are explained in detail below.
6.1 Executive Remuneration Framework
In structuring remuneration, the Board aims to find a balance between fixed remuneration and ‘at risk’ variable remuneration;
cash and deferred equity; and short-, medium-, and long-term rewards in line with the Company’s performance cycle.
59
The Remuneration Framework is outlined in the table below and explained in detail in this section of the Report.
Content Led Growth
Strategic Priorities
Transformation
Remuneration Strategy
Capital Structure and M&A
Attract and retain high-performing employees with market competitive and flexible reward.
Align reward to our business strategy, helping to create sustainable shareholder value, while adhering to good governance principles.
Seven West Media’s remuneration framework is reinforced by the following principles:
Remuneration Principles
Align remuneration
with shareholder
interests
Provide market
competitive
and responsible
remuneration
Enable attraction
and retention of
high-performing
employees
Support an
appropriate culture
and employee
conduct
Be simple, flexible
and transparent
Differentiate pay for
performance and
behaviour in line
with our vision
and strategy
Executive Remuneration Structure
Fixed
Total Employment
Remuneration (TER)
At Risk
Short-Term
Incentive (STI)
Long-Term
Incentive (LTI)
Component
Determination
Fixed remuneration is set with
reference to the median of our
peer groups, reflecting:
> Size and complexity of the role;
> Individual responsibilities
and performance; and
> Skills and experience.
Delivery
Fixed remuneration comprises:
> Cash salary;
> Superannuation; and any
> Prescribed non-financial
benefits at the Executives’
discretion on a salary
sacrifice basis.
Strategic Intent &
Market Positioning
Our peer groups are the Australian
media and entertainment industry
as well as more broadly across
appropriate ASX-listed companies.
STI rewards financial and non-
financial performance consistent
with the Company’s strategy over
the short to medium term with
reference to:
> Group EBIT and revenue;
> Strategic programs, content
and product;
> Audience and customers;
> Transformation, operational risk
and compliance;
> People and leadership; and
> Individual performance targets
relevant to the specific position.
STI is delivered as:
> 50 per cent cash; and
> 50 per cent in Performance
Rights, subject to service
conditions.
LTI ensures alignment of Executive
accountability and remuneration
outcomes for sustainable long-term
growth and shareholder return.
For both the FY21 & FY22 LTI Grants,
targets are linked to:
> Absolute TSR (ATSR)
performance
> Compound Annual Growth
Rate (CAGR) of ATSR over a
three-year vesting period with
an additional 12-month holding
lock.
LTI is delivered as:
> 100 per cent in Performance
Rights subject to performance
and service conditions
> Performance is tested once at
the end of the vesting period.
Performance incentive is directed to
achieving Board approved targets,
reflective of market circumstances.
Combined, fixed remuneration
and target STI is intended to
be positioned towards the 3rd
quartile of the relevant benchmark
comparisons.
LTI is intended to reward Executive
KMP for sustainable long-term
growth aligned to shareholders’
interests. LTI allocation values are
intended to be positioned around
the 3rd quartile of the relevant
benchmark comparisons.
Target Remuneration
Mix
> MD & CEO:
> CFO:
> Other Executive KMP:
33.3%
40%
57%
33.3%
30%
29%
33.3%
30%
14%
Total Target Remuneration (TTR)
TTR is positioned to achieve the remuneration objectives outlined above. Out-performance generates higher reward.
The remuneration structure is designed to ensure top quartile Executive KMP remuneration is only achieved if the Company
out-performs against stated targets.
60
Reissued – Remuneration Report Seven West Media Limited Annual Report 2022 6.1.1 Fixed Remuneration
Fixed remuneration is expressed as a total dollar amount which is delivered as cash salary and employer contributions to
superannuation funds as well as any ongoing employee benefits on a salary-sacrificed basis. It provides a fixed level of
income commensurate with the Executive’s role, responsibilities, qualifications and experience, and is set by considering peer
market data.
6.1.2 Short-Term Incentive (STI)
STI rewards the achievement of pre-determined individual and Company KPIs over the 12-month performance period
which are aligned to and supportive of the Company’s annual strategic objectives. STI awards are delivered in cash and
deferred shares.
For FY22, Performance Rights were issued at the beginning of the performance period.
Short-Term Incentive Plan
The STI Plan is an award used to provide clear motivation to focus on strategically aligned metrics and goals that can be
measured annually. The award reflects the achievement of specific objectives that are based on a top down and rigorous
bottom-up budget process.
Further details on the key design features of the FY22 STI Plan are set out below.
Seven West Media STI Plan
STI Opportunity
Eligibility
Delivery of Awards
For the MD and CEO, the ‘at target’ STI opportunity is 100 per cent of fixed remuneration up to a
maximum of 150 per cent and determined subject to the Board’s discretion. For the CFO, allocation is
based on 75 per cent of fixed remuneration and for each other Executive, the STI opportunity for on-
target performance is 50 per cent of fixed remuneration. ‘On-target’ refers to the STI award opportunity
for an Executive who achieves successful performance against all KPIs and where 100 per cent of the
Group’s underlying EBIT target is achieved. EBIT is defined as the Group’s profit before significant items,
net finance costs and tax.
The STI Plan covers employees in executive and senior management positions, subject to having more
than three months’ active service during the financial year and remaining employed on, or not having
provided notice of termination before the award date.
50 per cent is paid in cash at the end of the annual Performance and Remuneration Review (usually in
the pay cycle after results have been released in August). To support an ownership culture and drive
retention outcomes, 50 per cent of the STI award was delivered in Performance Rights allocated early in
the performance period.
The number of Performance Rights allocated to each participant will be determined by dividing the dollar
amount of the STI award deferred component by the 5-trading day volume weighted average price
(VWAP) of the Company’s Share price leading into and including 25 June 2021 (the “Market Price”),
rounded down to the nearest whole number.
Executives have entitlements to dividends and voting rights in relation to their Restricted Shares during
the restriction period (in the event that dividends are reinstated).
Following assessment at the end of the performance year, the vested award will be converted to
Restricted Shares and will be subject to a 12-month deferral.
Target Opportunity
Determination
of the STI Gateway
STI targets are set by the Committee and approved by the Board at the start of each performance year,
based on a range of factors including market competitiveness and the responsibilities of each role.
At Company level, the STI pool is based on performance. The size of the pool available for distribution
as STI awards is based on the achievement of the Group’s underlying EBIT target set by the Board at the
beginning of the financial year as shown in the table below.
Percentage of Group Underlying EBIT Achieved
(%)
STI Award Pool Available
(% of On-Target)
<90%
90–94%
95–99%
100%
0%
25%
50%
100%
The Board retains discretion to not make an STI award available to participants where such payment
is regarded to be inconsistent with shareholders’ interests over the financial year, even if the gateway
requirement is achieved.
61
Seven West Media STI Plan
Performance
Conditions
Performance is measured against risk-adjusted financial targets and non-financial targets which
support the Company’s strategy. Performance measures are based on performance at Group, divisional
and individual level. The deferred STI awards recognise past performance and are not subject to further
performance hurdles (other than continued service). Refer Section 5 on the MD and CEO’s balanced
scorecard.
Assessment of
Performance Outcomes
STI outcomes are subject to both a quantitative and qualitative assessment. The Board has the capacity
to adjust STI outcomes (and reduce STI outcomes to zero if appropriate) in the assessment process.
STI Treatment on
Cessation of Employment
Participants must be employed on the award payment date and not be in a period of termination notice.
The deferred component of an STI award will be forfeited if the participant resigns or the employment
is terminated for cause, prior to the vesting date. The Board has discretion to determine whether the
participant retains any unvested deferred awards relating to prior years’ STI performance outcomes if
the participant leaves due to any other circumstances, having regard to prior years’ STI performance
and time elapsed to the date of cessation.
Determination of STI at an Individual Level
At an individual level, STI is designed to focus Executive KMP on key performance measures supporting the Company’s
business strategy and encourage the delivery of value for shareholders.
Beginning of
Performance
Period
r
a
e
Y
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i
a
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n
a
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i
F
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e
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i
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End of
Performance
Period
Performance Objectives Set
> Individual objectives are agreed for Executive KMP, using a balanced scorecard approach
under the four categories of (i) Strategic; (ii) Financial; (iii) Audience and Content; and (iv) People,
Operations and Compliance.
> The weighting of measures varies to reflect the responsibilities of an individual’s role.
> Many of these measures relate to the contribution towards short to medium term performance
outcomes aligned to the Company’s strategic objectives.
> This methodology is replicated across the Company for all employees reflecting the individual’s
responsibilities.
Performance Assessed Against Objectives
> The performance of each Executive KMP is assessed against their objectives and compliance
standards.
> The Remuneration & Nomination Committee seeks input from the MD and CEO and CFO
(on financial performance, internal audit and compliance matters).
> The Committee reviews (and the Board reviews and approves) the performance outcomes for the
MD and CEO.
Determination of Remuneration Outcomes
> The Committee considers the performance of the Group, division and individual to determine
remuneration recommendations for Executive KMP respectively.
> Where Executive KMP deliver on-target performance at a Group, divisional and individual level
(taking into consideration the Company’s values and compliance standards), then incentive award
recommendations are likely to be around target opportunity. Recommendations will be adjusted up
or down in line with performance.
> The Committee’s recommendations for the MD and CEO are then reviewed and ultimately approved
by the Board.
6.1.3 Long-Term Incentive (LTI)
LTI rewards performance over the longer term and is designed to encourage sustained performance, drive long-term shareholder
value creation, and ensure alignment of executive remuneration outcomes to shareholder interests. LTI awards are delivered
in the form of Performance Rights subject to Company performance hurdles and individual service conditions being met.
Long-Term Incentive Plan
The LTI Plan is a means to align incentive pay with specific corporate results measured over three years. LTI Plan metrics are
approved by the Board for the beginning of the three-year performance period and are performance-granted with vesting
following the end of the performance period.
Key Terms of FY22 LTI Awards
The key features of the FY22 LTI Plan are provided in the following table.
62
Reissued – Remuneration Report Seven West Media Limited Annual Report 2022
Seven West Media Long-Term Incentive Plan
LTI Plan Vehicle
Number of Performance
Rights Granted
The grant is made in the form of Performance Rights. The Performance Rights are granted at no cost and
each right entitles the participant to one ordinary share in the Company, subject to the achievement of
the performance hurdles and service conditions outlined below. As Performance Rights are automatically
exercised at vesting, no expiry date applies.
The value of LTI granted is allocated annually at 100 per cent of the MD and CEO’s fixed remuneration.
For the CFO, allocation is based on 75 per cent of fixed remuneration, and for other Executive KMP,
allocation is based on 25 per cent of fixed remuneration. The number of Performance Rights granted
to each Executive is equivalent to the face value of the LTI grant divided by an amount calculated
based on the share price in accordance with the terms and conditions of the Plan.
Performance Hurdle
Performance Rights are subject to continued employment with Seven West Media and an absolute
Total Shareholder Return compound annual growth rate (ATSR CAGR) performance hurdle, measured
over a three-year period (1 July 2021 to 30 June 2024).
ATSR CAGR and
Vesting Schedule
ATSR CAGR is a metric where the Company’s performance is measured against a predefined target. That
is, it focuses on the growth of SWM and value to shareholders, regardless of the broader market and other
companies’ movements.
It provides executives with a more direct line of sight to the level of shareholder return to be achieved. It also
provides a tighter correlation between the executives’ rewards and the shareholders’ financial outcomes.
The proportion of Performance Rights available to vest following testing of ATSR CAGR performance period
is summarised in the following table:
Company’s ATSR CAGR over
the Performance Period
Proportion of Performance Rights
available to vest %
Less than 10%
10%
Nil
50%
Greater than 10% but less than 15%
On a straight-line pro-rata basis
between 50% to 85%
15%
85%
Greater than 15% but less than 20%
On a straight-line pro-rata basis between
85% to 100%
Equal to or greater than 20%
100%
Testing of
Performance Hurdle
Awards are subject to a three-year performance period. Shortly after the completion of the performance
period, the performance hurdles are tested to determine whether, and to what extent, awards vest.
In assessing performance against the performance hurdles, the Remuneration & Nomination Committee,
in its absolute discretion, may make any adjustments having regard to any matters that it considers
relevant, including adjusting for abnormal or unusual factors that are outside of management’s control.
The LTI Plan does not permit re-testing. Any Performance Rights that do not vest following testing of
performance hurdles (i.e., at the end of the three-year performance period) will lapse.
Disposal Restrictions
on Vested Shares
There is a restriction imposed on the sale of shares acquired after vesting (to the extent the performance
hurdles are achieved) until the earliest of the following:
> The date the Executive ceases employment with Seven West Media (subject to approval by
the Board);
> The one-year anniversary of the vesting date (or subsequent anniversaries (if elected by the
Executive)); or
> The Board determines that the restriction should be released.
Dividends and Voting Rights
Performance Rights do not carry any dividend or voting rights prior to vesting.
Change of Control
In the event of a change of control of the Company, unvested Performance Rights may vest to the extent
the performance hurdles are considered to have been achieved to the date of the transaction. The Board
will have discretion to determine whether any additional vesting should occur.
Cessation of Employment
Hedging
If the participant ceases employment before the end of the performance period by reason of death,
disablement, retirement, redundancy or for any other reason approved by the Board, unvested awards
remain on-foot, subject to original performance hurdles, although the Board may determine that some
or all of the awards should be forfeited. If the participant ceases employment before the end of the
performance period by reasons other than outlined above, unvested awards will automatically lapse.
Under the Seven West Media Equity Incentive Plan Rules, Executives who are granted share-based
payments, such as Performance Rights under the LTI Plan as part of their remuneration, are prohibited
from entering into other arrangements that limit their exposure to losses that would result from share
price decreases.
63
6.2 Link Between Remuneration Policy and Company Performance
MD and CEO Performance Objectives and Key Highlights
The Committee reviews and makes recommendations to the Board on performance objectives for the MD and CEO. These
objectives are intended to provide a clear link between remuneration outcomes and the key drivers of long-term shareholder
value. The STI objectives are set in the form of a balanced scorecard with targets and measures aligned to the Company’s
strategic priorities cascaded from the MD and CEO scorecard to the relevant Executive KMP scorecard. The key financial and
non-financial objectives for the MD and CEO in the 2022 financial year, with commentary on key highlights, are provided in
Section 5 of the Report.
Company Financial Performance – Five Year Perspective
In FY22, the Remuneration Policy was linked to profit before significant items, net finance costs and tax (EBIT), and TSR
performance of the Group.
The following table sets out the Group’s performance over the last five financial years:
Profit before significant items1, net finance costs
308,993
2022
20215
229,108
20204,5
94,985
20194,5
212,812
and tax (EBIT) ($’000’s)
Statutory NPAT ($’000’s)
NPAT (excluding significant items)1,2 ($’000’s)
211,052
200,759
318,122
(201,181)
(324,294)
125,545
36,896
249,451
20184,5
235,636
132,789
140,357
Revenue ($'000's)
1,539,629
1,269,646
1,227,047
1,427,003
1,621,092
Profit before depreciation, amortisation,
342,190
253,891
123,427
263,468
270,886
significant items1, net finance costs and tax
(EBITDA) ($’000’s)
Diluted earnings per share (as reported) (cents)
Diluted earnings per share (excluding significant
items)1 (cents)
Dividend per share (cents)
Share price as at reporting date3 ($)
Return on capital employed (%)
13.0
12.4
–
0.38
31.50
20.7
8.2
–
0.47
22.75
(13.2)
2.5
–
0.09
9.55
(21.5)
16.5
–
0.47
21.03
8.8
9.3
–
0.84
15.91
1 Significant Items is a non-IFRS measure. For details of significant items, refer to Note 2.4 to the Financial Statements.
2 NPAT (excluding significant items) is a non-IFRS measure. This measure is applied consistently year on year and used internally by management
to assess the performance of the business and hence is provided to enable an assessment of remuneration compared to Group performance.
Refer to the Operating and Financial Review for reconciliation to statutory net profit after tax.
The opening share price on the first day of trading in FY18 was $0.685.
2020, 2019 and 2018 figures have been restated in the past.
Excludes discontinued operations.
3
4
5
Company performance is linked to the STI Plan through the underlying EBIT hurdle, and for the LTI Plan, Company performance
is linked through the ATSR CAGR target.
The Company continues to operate in intensely competitive markets. Executive ‘at risk’ remuneration outcomes are dependent
on the Company and Group’s financial performance reflecting the Board’s commitment to maintaining the link between
executive remuneration and Company performance.
6.3 Executive Service Agreements
The terms of employment for Executive KMP of the Seven West Media Group are formalised in their employment agreements,
the major provisions of which are set out below.
Name
J Warburton
KJ Burnette
J Howard
KA McGrath
BI McWilliam
Duration of Contract
Period of Notice Required to
Terminate the Contract
Contractual
Termination Benefits
Open-ended
Open-ended
Open-ended
Open-ended
Open-ended
Six months’ notice
Six months’ notice
Six months’ notice
Three months’ notice
Three months’ notice
Nil
Nil
Nil
Nil
Nil
64
Reissued – Remuneration Report Seven West Media Limited Annual Report 2022 6.4 Non-Executive Director Remuneration Framework
Fees and payments to Non-Executive Directors reflect the demands which are made on, and the responsibilities of, the Non-
Executive Directors. Seven West Media’s Non-Executive Director remuneration framework is designed to attract and retain
experienced, qualified Board members and remunerate them appropriately for their time and expertise.
The table below sets out the components of Non-Executive Director remuneration:
> Base Fee – This fee is paid as cash and is for service as a Non-Executive Director of the Seven West Media Board.
The base fee for the Chairman of the Board covers all responsibilities, including all Board Committees.
> Committee Fees – These additional fees are also paid as cash to other Non-Executive Directors for chairing or
participating in Board Committees.
> Employer Superannuation Contributions – This component reflects statutory superannuation contributions which are
capped at the superannuation maximum contributions base as prescribed under the Superannuation Guarantee legislation.
To maintain independence and impartiality, Non-Executive Director fees are not linked to the Company’s performance or
short-term results. Likewise, Non-Executive Directors are not eligible to participate in any of the Company’s performance-
based remuneration arrangements.
6.4.1 Fee Pool
The aggregate of payments each year to Non-Executive Directors must be no more than the amount approved by
shareholders in the Annual General Meeting (AGM). The current aggregate fee pool is $1.9 million which is inclusive of
employer superannuation contributions, was approved at the 2013 AGM held on 13 November 2013. The aggregate of
payments to Non-Executive Directors in FY22 did not exceed the approved amount. For the year ended 25 June 2022,
$1.412 million (74 per cent) of this fee pool was used.
6.4.2 Non-Executive Director Remuneration in FY22
The fees for the year to 25 June 2022 are provided in the table below:
Annual Remuneration
Board
Audit and Risk Committee
Chairman
Member
$335,000
$135,000
$40,000
$20,000
Remuneration and
Nomination Committee
$20,000
$10,000
6.4.3 Changes to Board and Committee Composition
There were no changes made to Board and Committee composition during the 2022 financial year.
6.4.4 Non-Executive Director Share Plan
A Non-Executive Director Share Plan (the Plan) will be introduced commencing 1 July 2022 to further encourage and facilitate
share ownership for Board members. As a result of changes to Australian tax laws, which came into effect on 1 July 2015, and
in line with market practice, this Plan allows greater flexibility for Non-Executive Directors to acquire equity in a tax effective
manner through a pre-tax fee sacrifice plan.
The Plan provides an automated mechanism for participants to acquire shares, recognising that Non-Executive Directors
can often be limited in their ability to purchase shares as a result of the Australian insider trading laws. Subject to shareholder
approval and compliance with the Company’s Share Trading Policy, Share Rights will be granted to participants twice a year,
shortly following the announcement of the Company’s half year and full year results in February and August respectively.
On vesting, the Share Rights will convert into fully paid ordinary shares subject to a disposal restriction (a Restricted Share).
The Plan supports the minimum shareholding requirement for Board members as it allows Non-Executive Directors to reach
the minimum shareholding requirements more quickly, as shares are acquired on a pre-tax basis.
The Board will seek approval of the Non-Executive Director Share Plan at the 2022 AGM.
65
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Reissued – Remuneration Report Seven West Media Limited Annual Report 2022
7.2 Non-Executive Remuneration in Detail
Details of the remuneration of the Company’s Non-Executive Directors for the year ended 25 June 2022 are set out the
following table.
Name
Non-Executive Directors
KM Stokes AC, Chairman
JH Alexander
T Dyson
D Evans
C Garnsey OAM
M Malone
RK Stokes AO
M Ziegelaar
Total Non–Executive Director Fees
Short-Term
Benefits
Post-Employment
Benefits
Seven West
Media Board
Fees1
$
Non-Monetary
Benefits
$
Financial
Year
Superannuation
$
Total
$
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
311,432
309,289
140,909
139,738
159,091
157,768
144,545
143,344
131,818
130,722
135,455
134,329
145,000
143,141
135,455
134,329
1,303,705
1,292,660
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
23,568
335,000
21,694
330,983
14,091
155,000
13,275
153,013
15,909
175,000
14,988
172,756
14,455
159,000
13,618
156,962
13,182
12,419
13,545
12,761
–
–
13,545
12,761
145,000
143,141
149,000
147,090
145,000
143,141
149,000
147,090
108,295
1,412,000
101,516
1,394,176
1
Includes fees paid to the Chairman and members of Board Committees.
7.3 Key Management Personnel Equity Transactions and Holdings
7.3.1 Equity Incentive Plan Holdings
Equity grants under the LTI Plan and the STI Plan are made in accordance with the Seven West Media Equity Incentive Plan Rules.
67
FY22 LTI Grant and Prior Years’ LTI Grants
Details of vesting profiles of the Performance Rights granted as remuneration in FY22 to each Executive KMP of the Company
under its LTI Plan, including prior years’ Performance Rights that remain unvested and on-foot, are provided below.
Name
Number of
Performance
Rights
Grant
Date
Fair Value
Per Right at
Grant Date
Number of
Rights Vested
During FY22
Percentage of Rights
Forfeited, Lapsed or
Cancelled in FY22
Financial Year in
which Grant may
Vest
J Warburton
3,047,404
26–Nov–21
KJ Burnette
J Howard
K McGrath
705,417
26–Nov–21
1,100,451
26–Nov–21
296,275
26–Nov–21
BI McWilliam
620,767
26–Nov–21
J Warburton
KJ Burnette
J Howard
K McGrath
11,250,000
01–Dec–20
2,604,166
01–Dec–20
2,708,333
01–Dec–20
1,093,750
01–Dec–20
BI McWilliam
2,291,666
01–Dec–20
J Warburton
J Warburton
KJ Burnette
J Howard
K McGrath
BI McWilliam
5,472,972
31–Jan–20
5,472,973
31–Jan–20
844,594
391,190
354,729
557,432
31–Jan–20
31–Jan–20
31–Jan–20
31–Jan–20
$0.405
$0.405
$0.405
$0.405
$0.405
$0.220
$0.220
$0.220
$0.220
$0.220
$0.045
$0.065
$0.045
$0.045
$0.045
$0.045
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
100%1
100%1
100%
100%
100%
100%
2025
2025
2025
2025
2025
2024
2024
2024
2024
2024
–
–
–
–
–
–
1
10,945,945 Performance Rights were cancelled in relation to J Warburton’s FY20 LTI Grant as approved by shareholders at the Company’s 2020 AGM.
With respect to the FY22 LTI grant, the maximum possible total value of the grant assuming all vesting conditions are met
is calculated as the number of Performance Rights times the fair value. This maximum value, measured under applicable
accounting standards, will be recognised as statutory remuneration on a straight-line basis equally over the three financial
years 2022, 2023 and 2024. If all vesting conditions are met, this will be received by each Executive in the year of vesting.
The minimum possible total value is nil where the vesting conditions are not met.
7.3.2 Total Performance Rights Holdings
The total number of Performance Rights in the Company held during the financial year by each Executive KMP of the Group
are set out in the table below:
Performance Rights
Granted as Remuneration
Performance
Rights Vested
Name
Financial
Year
Opening
Balance
Number
Granted1
Managing Director and Chief Executive Officer
Value
Granted1
$
Number
Vested
Value
Vested2
$
Number of Rights
Forfeited, Lapsed
or Cancelled
Closing
Balance
J Warburton
2022
22,500,000
5,213,179
2,362,500 (11,250,000)
5,568,750
–
16,463,179
2021
10,945,945
22,500,000
3,918,750
–
–
(10,945,945) 22,500,000
Executive KMP
KJ Burnette
2022
6,920,982
1,373,866
625,000
(3,472,222)
1,718,750
(844,594)
3,978,032
2021
1,136,650
6,076,388
625,000
–
–
(292,056)
6,920,982
J Howard
2022
4,905,079
1,759,488
795,600
(1,805,555)
893,750
(391,190)
4,467,822
2021
391,190
4,513,889
487,500
–
–
–
4,905,079
KA McGrath
2022
2,906,812
577,023
262,500
(1,458,333)
721,875
(354,729)
1,670,773
2021
459,869
2,552,083
262,500
–
–
(105,140)
2,906,812
BI McWilliam
2022
5,904,654
1,209,002
550,000
(3,055,555)
1,512,500
(557,432)
3,500,669
2021
750,189
5,347,222
550,000
–
–
(192,757)
5,904,654
Total
2022
43,137,527
10,132,558
4,595,600 (21,041,665)
10,415,625
(2,147,945) 30,080,475
2021
13,683,843
40,989,582
5,843,750
–
–
(11,535,898)
43,137,527
1
Includes both FY22 STI and FY22 LTI awards granted as Performance Rights. The FY22 STI Performance Rights are based on the 5-Day VWAP
at grant date of $0.4675, and the FY22 LTI Performance Rights are based on the 5-Day VWAP at grant date of $0.443. In the prior year, FY21 STI
Performance Rights are based on the 5-Day VWAP at grant date of $0.09.
2 Based on the closing share price of Seven West Media on 31 August 2021 of $0.4950.
68
Reissued – Remuneration Report Seven West Media Limited Annual Report 2022
7.3.3 Equity Holdings and Transactions of Executive Key Management Personnel
The table below provides details of equity granted as remuneration and the number of ordinary shares in the Company
held during the financial year by Executive KMP of the Company held directly, indirectly, beneficially and including their
personally-related entities.
Executive KMP Equity Granted, Vested, Exercised and Lapsed
Number
Held at
Start of
the Year
Number
Granted
During the
Year as
Remuneration1
Number
Received
on
Exercise
and/or
Exercised
During the
Year2
Number
Lapsed
During the
Year
Other
Changes
During the
Year
Number
Held at
End of the
Year
Number
Vested and
Exercisable
at End of the
Year2
Name
Type of Equity-
Based Instrument
Managing Director and Chief Executive Officer
J
Warburton
Restricted Shares
Ordinary Shares
–
–
11,250,000
–
–
–
Performance Rights
22,500,000
5,213,179 (11,250,000)
Executive KMP
KJ
Burnette
Restricted Shares
–
3,472,222
Ordinary Shares
230,364
–
–
–
–
–
–
–
–
Performance Rights
6,920,982
1,373,866
(3,472,222)
(844,594)
J Howard
Restricted Shares
–
1,805,555
Ordinary Shares
195,630
–
–
–
–
–
Performance Rights
4,905,079
1,759,488
(1,805,555)
(391,190)
KA
McGrath
Restricted Shares
Ordinary Shares
197,530
44,940
1,458,333
(197,530)
–
197,530
–
–
Performance Rights
2,906,812
577,023
(1,458,333)
(354,729)
BI
McWilliam
Restricted Shares
–
3,055,555
Ordinary Shares
391,387
–
–
–
–
–
– 11,250,000
–
–
– 16,463,179
–
–
–
–
–
–
–
–
–
–
3,472,222
230,364
3,978,032
1,805,555
195,630
4,467,822
1,458,333
242,470
1,670,773
3,055,555
241,221
632,608
Performance Rights
5,904,654
1,209,002
(3,055,555)
(557,432)
–
3,500,669
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1
2
Includes both FY22 STI and FY22 LTI awards granted as Performance Rights. The balance of Performance Rights at the end of the year are
unvested rights.
Performance Rights granted in 2020 vested in July 2022 as assessed against the RTSR performance and subject to an individual performance
condition. Restricted shares include vested Performance Rights that are subject to the 12-month holding lock. This includes the conversion of
Restricted Shares to ordinary shares at the completion of the 12-month holding block.
Non-Executive Directors
The number of ordinary shares in the Company held during the financial year by each Non-Executive Director of Seven West
Media Limited held directly, indirectly, beneficially, and including their personally related entities are set out in the tables below.
Name
Chairman of the Seven West Media Board
KM Stokes AC
Non-Executive Directors
JH Alexander
T Dyson
D Evans
C Garnsey OAM
M Malone
RK Stokes AO
M Ziegelaar
Type of
Equity-Based
Instrument
Number Held
at Start of
the Year
Changes
During the
Year
Number Held
at End of
the Year
Ordinary Shares
619,753,734
1,700,000
621,453,734
Ordinary Shares
Ordinary Shares
Ordinary Shares
Ordinary Shares
Ordinary Shares
Ordinary Shares
Ordinary Shares
55,768
38,218
927,803
250,000
233,000
240,466
10,000
–
79,502
470,000
175,000
–
–
–
55,768
117,720
1,397,803
425,000
233,000
240,466
10,000
69
8. Loans and Other Transactions with Key Management Personnel
Transactions involving the Non-Executive Directors and Executive KMP and their related parties are conducted on normal
commercial terms and conditions that are no more favourable than those given to other employees or customers. Any that are
on-foot, are trivial or domestic in nature.
There were no loans provided to KMP during FY22.
70
Reissued – Remuneration Report Seven West Media Limited Annual Report 2022 Lead Auditor’s Independence
Declaration under Section 307C
of the Corporations Act 2001
To the Directors of Seven West Media Limited
I declare that, to the best of my knowledge and belief, in relation to the audit of Seven West Media Limited
for the financial year ended 25 June 2022 there have been:
i.
no contraventions of the auditor independence requirements as set out in the Corporations Act 2001
in relation to the audit; and
ii. no contraventions of any applicable code of professional conduct in relation to the audit.
KPMG
Sydney
16 August 2022
Duncan McLennan
Partner
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global
organisation. Liability limited by a scheme approved under Professional Standards Legislation.
71
Financial Statements
For the year ended 25 June 2022
Table of Contents
Financial Statements
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
ASX Information
Investor Information
Shareholder Information
Company Information
74
75
76
77
78
124
125
131
132
134
72
Financial Statements Seven West Media Limited Annual Report 2022 4. Other Key Balance Sheet Items
7. Group Structure
4.1 Intangible Assets
7.1 Equity Accounted Investees
4.2 Property, Plant and Equipment
7.2 Investments in Controlled
Notes Index
1. Introduction and
basis of preparation
1.1 Basis of preparation
2. Group Performance
2.1 Segment Information
4.3 Leases
4.4 Provisions
2.2 Revenue and Other Income
4.5 Other Financial Assets
2.3 Expenses
2.4 Significant Items
2.5 Earnings Per Share
3. Working Capital
3.1 Cash and Cash Equivalents
3.2 Trade and Other Receivables
3.3 Program Rights and Inventories
3.4 Trade and Other Payables
3.5 Commitments
3.6 Contract Assets and Liabilities
5. Taxation
5.1 Taxes
5.2 Deferred Tax Assets
and Liabilities
6. Capital Management
6.1 Borrowings
6.2 Share Capital
6.3 Reserves
6.4 Dividends
6.5 Share-Based Payments
6.6 Capital and Financial
Risk Management
Entities
7.3 Parent Entity Financial
Information
7.4 Business Combinations
7.5 Related Party Transactions
8. Other
8.1 Remuneration of Auditor
8.2 Contingent Liabilities
8.3 Events Occurring After
The Reporting Date
8.4 Summary of Other Significant
Accounting Policies
8.5 Changes in Accounting Policies
and Disclosures
73
Consolidated Statement of Profit or Loss
and Other Comprehensive Income
For the year ended 25 June 2022
Continuing Operations
Revenue
Other income
Revenue and other income
Expenses
Reversal of intangible assets
Reversal of investments and other assets
Net income related to investments
Net gain on disposal of investments
Redundancy and restructure reversal
Onerous Contracts provisioning
Reversal of onerous provisioning
Other
Share of net profit of equity accounted investees
Profit before net finance costs and tax from continuing operations
Finance income
Finance costs
Write off of unamortised original refinancing cost
Profit before tax from continuing operations
Tax expense
Profit for the year from continuing operations
Discontinued operations
Loss after tax for the year from discontinued operations
Profit for the year
Other comprehensive income (expense)
Items that may be reclassified subsequently to profit or loss:
Effective portion of changes in fair value of cash flow hedges
Exchange differences on translation of foreign operations
Tax relating to items that may be reclassified subsequently to profit or loss
Items that will not be reclassified to profit or loss:
Net change in fair value of financial assets (net of tax)
Other comprehensive income (expense) for the year, net of tax
Total comprehensive income (expense) for the year
Total comprehensive income (expense) attributable to:
Owners of the Company
Non–controlling interests
Total comprehensive income (expense) for the year
Earnings per share for profit attributable to the ordinary equity holders of the Company
Notes
2022
$’000
2021
$’000
2.2
2.2
2.3
2.4
2.4
2.4
2.4
2.4
2.4
2.4
2.4
7.1
2.4
5.1
6.3
6.3
6.3
6.3
1,538,537
1,269,609
1,092
37
1,539,629
1,269,646
(1,230,954)
(1,046,860)
–
–
3,728
2,590
–
–
8,351
–
318
323,662
1,385
(36,841)
(4,815)
283,391
(72,339)
211,052
–
211,052
–
503
–
(20,940)
(20,437)
190,615
190,602
13
190,615
207,480
1,249
470
3,445
4,863
(7,588)
66,728
1,230
6,322
506,985
1,501
(62,175)
(690)
445,621
(127,499)
318,122
(34)
318,088
4,420
(25)
(1,326)
(49)
3,020
321,108
321,035
73
321,108
Basic earnings per share
Diluted earnings per share
2.5
2.5
13.3 cents
13.0 cents
20.7 cents
20.7 cents
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.
74
Financial Statements Seven West Media Limited Annual Report 2022 Consolidated Statement of
Financial Position
As at 25 June 2022
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Program rights and inventories
Contract assets
Other assets
Total current assets
Non-current assets
Program rights
Equity accounted investees
Other financial assets
Property, plant and equipment
Intangible assets
Right of use assets
Other assets
Total non-current assets
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Lease liabilities
Provisions
Deferred income
Contract liabilities
Current tax liabilities
Total current liabilities
Non-current liabilities
Trade and other payables
Lease liabilities
Provisions
Deferred income
Contract liabilities
Deferred tax liabilities
Borrowings
Total non-current liabilities
Total liabilities
Net assets
EQUITY
Share capital
Reserves
Non-controlling interests
Accumulated deficit
Total equity
Notes
2022
$’000
2021
$’000
3.1
3.2
3.3
3.6
3.3
7.1
4.5
4.2
4.1
4.3
3.4
4.3
4.4
3.6
3.4
4.3
4.4
3.6
6.1
6.2
6.3
37,938
220,123
147,212
–
19,571
424,844
–
16,153
39,571
113,829
720,277
68,101
1,561
959,492
253,332
211,965
184,325
2,468
12,803
664,893
34
15,835
37,355
49,453
680,280
72,089
3,698
858,744
1,384,336
1,523,637
176,824
12,141
105,249
29,552
19,478
63,230
406,474
3,665
186,239
84,578
–
–
145,260
294,429
714,171
256,967
10,524
151,990
25,217
27,105
44,809
516,612
7,014
193,801
97,459
1,200
5,042
124,864
493,310
922,690
1,120,645
1,439,302
263,691
84,335
3,432,966
3,405,666
(35,537)
–
22,766
1,075
(3,133,738)
(3,345,172)
263,691
84,335
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
75
Consolidated Statement of
Changes in Equity
For the year ended 25 June 2022
Share
capital
$’000
Reserves
$’000
Notes
Accum-
ulated
deficit
$’000
Non-
controlling
Interests
$’000
Total
$’000
Total Equity
$’000
Balance at 27 June 2020
3,405,666
11,970
(3,663,187)
(245,551)
3,522
(242,029)
Profit for the year
Cash flow hedge gains taken to equity
Foreign currency translation differences
Tax on other comprehensive income
Net change in fair value of financial assets
(net of tax)
Other comprehensive income
for the year, net of tax
Total comprehensive income
for the year
Transactions with owners in their capacity as owners
Share based payment expense
Disposal of NCI
Total transactions with owners
–
–
–
–
–
–
–
–
–
–
–
318,015
318,015
73
318,088
4,420
(25)
(1,326)
(49)
3,020
–
–
–
–
–
4,420
(25)
(1,326)
(49)
3,020
–
–
–
–
–
4,420
(25)
(1,326)
(49)
3,020
3,020
318,015
321,035
73
321,108
7,776
–
7,776
–
–
–
7,776
–
7,776
–
(2,520)
(2,520)
7,776
(2,520)
5,256
Balance at 26 June 2021
3,405,666
22,766
(3,345,172)
83,260
1,075
84,335
Profit for the year
Foreign currency translation differences
Net change in fair value of financial assets
(net of tax)
Other comprehensive income
(expense) for the year, net of tax
Total comprehensive income
(expense) for the year
–
–
–
–
503
(20,940)
211,039
211,039
–
–
503
(20,940)
13
–
–
211,052
503
(20,940)
–
(20,437)
–
(20,437)
–
(20,437)
–
(20,437)
211,039
190,602
13
190,615
Transactions with owners in their capacity as owners
Share based payment expense
–
6,758
Shares issued pursuant to vesting of
executive employee share plan
Transactions with non-controlling interests
Disposal of NCI
27,300
(44,624)
–
–
–
–
Total transactions with owners
27,300
(37,866)
–
–
395
–
395
6,758
(17,324)
395
–
–
–
(395)
(693)
6,758
(17,324)
–
(693)
(10,171)
(1,088)
(11,259)
Balance at 25 June 2022
3,432,966
(35,537)
(3,133,738)
263,691
–
263,691
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
76
Financial Statements Seven West Media Limited Annual Report 2022 Consolidated Statement of
Cash Flows
For the year ended 25 June 2022
Cash flows related to operating activities
Receipts from customers
Payments to suppliers and employees
Dividends received from other investments
Interest and other items of similar nature received
Interest and other costs of finance paid
Interest paid on lease liability
Receipt of Government Grants
Income taxes paid, net of tax refunds
Net operating cash flows
Cash flows related to investing activities
Payments for purchases of property, plant and equipment
Payments for intangibles
Proceeds from sale of other assets
Payments for other financial assets (net of capital return)
Acquisition of subsidiaries, net of cash acquired
Proceeds from sale of investments
Proceeds on sale of subsidiaries (net of cash disposed)
Receipt of previously impaired loans from investees
Loans paid to investees
Net investing cash flows
Cash flows related to financing activities
Payments made for own shares
Proceeds from borrowings
Repayment of borrowings
Payment of refinancing costs
Payment of lease liabilities
Net financing cash flows
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
3.1
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
Notes
2022
$’000
2021
$’000
1,710,728
1,348,330
(1,502,707)
(1,188,808)
3.1
7.4
15,287
688
(19,464)
(16,714)
–
(27,586)
160,232
(24,911)
(2,465)
218
(11,141)
(100,874)
–
(1,758)
162
(400)
(141,169)
(17,324)
516,000
–
1,501
(30,142)
(17,714)
35,888
(5,844)
143,211
(13,815)
(1,876)
32
–
–
44,610
(3,430)
3,645
(1,000)
28,166
–
–
(716,000)
(250,000)
(7,124)
(10,009)
(11,600)
(8,466)
(234,457)
(270,066)
(215,394)
253,332
37,938
(98,689)
352,021
253,332
77
Section 1: Introduction and
basis of preparation
Seven West Media (SWM) is a for-profit company limited by shares
and incorporated in Australia whose shares are publicly traded on
the Australian Securities Exchange. The financial statements are for
the Group consisting of Seven West Media Limited (the “Company” or
“Parent Entity”) and its subsidiaries, all of which are for-profit entities.
The financial statements are presented in Australian dollars (AUD)
and all values are rounded to the nearest $1,000 unless otherwise
stated under the option available to the Company under Australian
Securities and Investments Commission (ASIC) Corporations
Instrument 2016/191.
The Group presents reclassified comparative information where
required for consistency with the current year’s presentation.
1.1 Basis of preparation
The consolidated general purpose financial report has been prepared
in accordance with the requirements of the Corporations Act 2001
and the Australian Accounting Standards and other authoritative
pronouncements of The Australian Accounting Standards Board
and International Financial Reporting Standards (IFRS).
All new and amended Accounting Standards and Interpretations
issued by the AASB that are relevant to the Group and effective
for the current reporting period have been adopted.
The consolidated financial statements were authorised for issue
by the Board of Directors on 16 August 2022. The financial statements
have been prepared using the historical cost basis except for assets
described in Note 6.6B.
78
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 Section 2:
Group Performance
2.1. Segment Information
2.1A. Description of Segments
Accounting policy
For management purposes, the Group is organised into business segments based on its products and services and has three reportable
segments, as follows:
Reportable segment
Description of Activities
Television
The West
Other Business
and New Ventures
Production and operation of commercial television programming and stations as well as distribution of
programming content across platforms in Australia and around the world. The results of Prime Media Group
have been included in the Television segment since acquistion.
Publishers of newspapers and insert magazines in Western Australia; Colourpress; Digital publishing,
West Australian Publishers and Community Newspaper Group.
Made up of equity accounted investees and other ventures investments.
The chief operating decision makers, responsible for allocating resources and assessing performance of the operating segments,
have been identified as the Chief Executive Officer, the Chief Financial Officer, Business Segment Chief Executive Officers and other
relevant members of the executive team.
Segment performance is evaluated based on a measure of profit/(loss) before significant items, net finance costs and tax.
Revenue from external sales is predominantly to customers in Australia and total segment assets are predominantly held in Australia.
Total assets and liabilities by segment are not provided regularly to the chief operating decision makers and as such, are not required
to be disclosed.
2.1B. Segment information
Year ended 25 June 2022
REF
Advertising revenue
Circulation revenue
Licencing of content and programming
Affiliate fees
Rendering of services
Other revenue
Television
$’000
1,212,189
–
73,143
65,164
–
17,367
The West
$’000
89,654
54,213
13,022
–
9,337
3,096
Revenue from continuing operations
1,367,863
169,322
Other income
Share of net profit of equity
accounted investees
Revenue, other income and share of net
profit of equity accounted investees
Expenses
Profit (loss) before significant items,
net finance costs, tax, depreciation
and amortisation
Depreciation and amortisation
[A]
Profit (loss) before significant items,
net finance costs and tax
–
–
–
–
1,367,863
169,322
(1,039,837)
(135,605)
328,026
(32,261)
33,717
(491)
Other
Business and
New Ventures
$’000
Corporate [B]
$’000
Total
$’000
1,301,843
54,213
86,165
65,164
9,337
21,815
1,538,537
1,092
318
1,539,947
–
–
–
–
–
–
–
–
–
–
(21,033)
(1,197,757)
(21,033)
342,190
(12)
(33,197)
–
–
–
–
–
1,352
1,352
1,092
318
2,762
(1,282)
1,480
(433)
295,765
33,226
1,047
(21,045)
308,993
79
Notes to the Financial Statements for the year ended 25 June 2022 2.1. Segment Information (continued)
Year ended 26 June 2021
REF
Advertising revenue
Circulation revenue
Licencing of content and programming
Affiliate fees
Rendering of services
Other revenue
Television
$’000
922,071
–
76,360
96,769
–
11,268
The West
$’000
91,092
55,605
–
–
11,573
3,887
Revenue from continuing operations
1,106,468
162,157
Other income
Share of net profit of equity
accounted investees
Revenue, other income and share of net
profit of equity accounted investees
Expenses
Profit (loss) before significant items,
net finance costs, tax, depreciation
and amortisation
Depreciation and amortisation
[A]
Profit (loss) before significant items,
net finance costs and tax
23
–
14
–
1,106,491
162,171
(870,915)
(133,652)
235,576
(23,994)
28,519
(304)
Other
Business and
New Ventures
$’000
Corporate [B]
$’000
Total
$’000
1,013,163
55,605
76,360
96,769
11,573
16,139
1,269,609
37
6,322
1,275,968
–
–
–
–
–
–
–
–
–
–
(17,013)
(1,022,077)
(17,013)
253,891
(51)
(24,783)
–
–
–
–
–
984
984
–
6,322
7,306
(497)
6,809
(434)
211,582
28,215
6,375
(17,064)
229,108
[A] Excludes program rights amortisation which is included in media content expenses (refer Note 2.3).
[B] Corporate is not an operating segment. The amounts presented are unallocated costs.
2.1C. Other segment information
Reconciliation of profit (loss) before significant items, net finance costs and tax
Profit before significant items, net finance costs and tax
Finance income
Finance costs
Profit before tax excluding significant items
Significant items before tax (refer Note 2.4)
Profit before tax
2022
$’000
2021
$’000
308,993
1,385
(36,841)
273,537
9,854
283,391
229,108
1,501
(62,175)
168,434
277,187
445,621
80
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 2.2. Revenue And Other Income
Accounting policy
Revenue recognition and measurement
The Group derives revenue from the transfer of goods and services. Revenue recognition is based on the delivery of performance
obligations and an assessment of when control is transferred to the customer. Revenue is recognised either when the performance
obligation in the contract has been performed (‘point in time’ recognition) or ‘over time’ as control of the performance obligation is
transferred to the customer.
Customer contracts can have a wide variety of performance obligations, from production contracts to format licences and distribution
activities. For these contracts, each performance obligation is identified and evaluated. The Group needs to evaluate if a distribution
right is a right to access the content (revenue recognised over time) or represents a right to use the content (revenue recognised at a
point in time). The Group has determined that most distribution revenues are satisfied at a point in time due to their being limited ongoing
involvement in the use of the rights following its transfer to the customer.
The transaction price, being the amount to which the Group expects to be entitled and has rights to under the contract is allocated
to the identified performance obligations. The transaction price will also include an estimate of any variable consideration where the
Group’s performance may result in additional revenues based on the achievement of agreed targets such as audience targets. Variable
consideration is not recognised until the performance obligations are met.
Revenue is stated exclusive of GST and equivalent sales taxes.
Revenue recognition criteria for the Group’s key classes of revenue are as follows:
Class of revenue
Recognition criteria
[A] Advertising
> Television Advertising is generated from selling spot airtime and is
recognised at the point of transmission.
> Newspapers Advertising is generated from selling space in the
newspaper and is recognised at the point of publication.
[B] Circulation
> Circulation revenue is generated through the distribution and sale
of newspapers to third party consumers. Recognised on delivery
of the newspaper to the customer and the right to be compensated
has been obtained.
[C] Licencing of content and programming includes:
(i) Programme
production
> Revenue generated from the programmes produced for broadcasters
in Australia and internationally and is recognised at the point of
delivery of an episode and acceptance by the customer.
(ii) Distribution rights
> A licence is granted for the transmission of a programme in a stated
territory, media and period and revenue is recognised at the point
when the contract is signed, the content is available for download
and the licence period has started.
[D] Affiliate fees
> Affiliate fees earned through the transmission of network channels
in a stated territory. Recognised in the period of the broadcast feed
to the affiliates in line with the contract terms and conditions.
[E]
Rendering of services
> The revenue is recognised when the service has been performed.
These services mainly relate to printing and are generally delivered
over a period of time.
[F]
Other revenue includes:
Timing of recognition
At the point in time when
the advertisement is
broadcast or published
At the time the
newspapers are
distributed
At the point in time
when obligations have
been accepted by the
customers
Recognised on delivery
of rights to the customer
Recognised over time as
conditions are met over
the contract life
At the point in time the
services are delivered
Rental income
> Rental income is derived through the leasing of assets and the
benefits are to be transferred over time.
Dividends
> Dividend revenue is recognised when the right to receive payment
is established.
Revenue is recognised
over the life of the lease
At the point in time the
dividend is declared
81
Notes to the Financial Statements for the year ended 25 June 2022
2.2. Revenue and Other Income (continued)
Sales revenue
Advertising revenue
Circulation revenue
Licencing of content and programming
Affiliate fees
Rendering of services
Other revenue
Total sales revenue
Other income
Dividends received
Sundry income
Net gain on disposal of property, plant and equipment and investments
Total other income
Timing of Revenue Recognition
REF
[A]
[B]
[C]
[D]
[E]
[F]
2022
$’000
2021
$’000
1,301,843
1,013,163
54,213
86,165
65,164
9,337
21,815
55,605
76,360
96,769
11,573
16,139
1,538,537
1,269,609
1,092
–
–
1,092
–
32
5
37
The following table includes revenue from contracts per above that have been disaggregated by the timing of recognition:
Products or services transferred at a point in time
Products or services transferred over time
Total External Revenue
2022
$’000
2021
$’000
1,473,373
1,172,840
65,164
96,769
1,538,537
1,269,609
82
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 2.3. Expenses
Profit (loss) before tax includes the following specific expenses:
Depreciation and amortisation (excluding program rights amortisation)
Advertising and marketing expenses
Printing, selling and distribution (including newsprint and paper)
Media content (including program rights amortisation)
Employee benefits expense (excluding significant items)
Raw materials and consumables used (excluding newsprint and paper)
Repairs and maintenance
Licence fees
Rental (expense) relating to operating leases2
Other expenses from ordinary activities
Total expenses
Included in the expenses above are the specific items [A] to [B] from continuing operations:
[A] Property, plant and equipment
Right of use assets
Amortisation of intangible assets
Total depreciation and amortisation
Television program rights amortisation
REF
[A]
[A]
[B]
2022
$’000
(33,197)
(22,677)
(26,641)
2021
$’000
(24,783)
(21,844)
(27,647)
(637,436)
(544,026)
(320,644)
(277,115)
(5,400)
(32,778)
(26,159)
(1,849)
(6,551)
(22,668)
(15,694)
(1,236)
(124,173)
(105,296)
(1,230,954)
(1,046,860)
(14,507)
(8,781)
(9,909)
(33,197)
(100,375)
(10,796)
(9,930)
(4,057)
(24,783)
(91,819)
Total depreciation and amortisation (including program rights and amortisation)
(133,572)
(116,602)
[B] Employee benefits expense1
Defined contribution superannuation expense
Total employee benefits expense
(292,109)
(256,300)
(28,535)
(320,644)
(20,815)
(277,115)
1
2
The Group did not receive any federal government JobKeeper subsidies during the current period (2021: $25.7 million).
In May 2020 the International Accounting Standards Board issued amendments to IFRS16 for COVID-19 Related Rent Concessions permitting
lessees, as a practical expedient, not to assesses whether a particular rent concession occurring as a direct consequence of the COVID-19
pandemic are lease modifications and instead to account for the rent concessions as if they are not lease modifications. The Group was not
provided with any rent concessions during the year (2021:$0.7 million).
83
Notes to the Financial Statements for the year ended 25 June 2022 2.4. Significant Items
Profit before tax expense includes the following specific items for which disclosure is relevant in explaining the financial performance of the
Group:
Impairment of other intangible assets
Reversal of previously impaired Television licences
Total reversal of impairment of intangible assets
Impairment of fixed assets
Impairment of right of use assets
Reversal of previously impaired right of use assets
Gain on lease modifications
Total reversal of impairment of investments and other assets
Net income related to investments
Net gain on disposal of subsidiaries
Redundancy and restructure costs reversal
Onerous Contracts provisioning
Reversal of onerous provisioning
Write off of unamortised original refinancing cost
Other
Total significant items before tax
Tax benefit/(expense) on significant items
Net significant items after tax
REF
2022
$’000
–
–
–
–
–
–
–
–
3,728
2,590
–
–
8,351
(4,815)
–
9,854
439
[A]
[B]
[C]
[D]
2021
$’000
(1,018)
208,498
207,480
(4,719)
(6,896)
11,333
1,531
1,249
470
3,445
4,863
(7,588)
66,728
(690)
1,230
277,187
(84,610)
10,293
192,577
[A] Net income from investments relates to the dividend received from PRT Company Limited (PRT) in February 2022, this is offset by costs incurred by
the Group on acquisition of Prime Media Group and other fair value movements.
[B] During the year the Group disposed of its subsidary Great Southern Television (GSTV).
[C] During the year, the Group recorded reversals to onerous provisions of $8.4 million as a result of changes to the onerous contract review
procedures. Refer to Note 4.4 for disclosure of the assumptions included in the calculation of the provision.
[D] The amount relates to previously unamortised borrowing costs written off following the October 2021 refinance.
84
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 2.5. Earnings Per Share
Accounting policy
Basic earnings per share
Basic earnings per share is calculated by dividing the net profit
(loss) attributable to ordinary equity holders of the Company
by the weighted average number of ordinary shares outstanding
during the financial year.
Diluted earnings per share
Diluted earnings per share is calculated by adjusting the figures
used in the determination of basic earnings per share to take
into account the after tax effect of interest and other financing
costs associated with dilutive potential ordinary shares and the
weighted average number of additional ordinary shares that would
have been outstanding assuming the conversion of all dilutive
potential ordinary shares.
Retrospective adjustments
If the number of ordinary or potential ordinary shares outstanding
increases as a result of a capitalisation, bonus issue or share split,
or decreases as a result of a reverse share split, the calculation
of basic and diluted earnings per share for all periods presented
shall be adjusted retrospectively. In addition, basic and diluted
earnings per share of all periods presented shall be adjusted for
the effects of errors and adjustments resulting from changes in
accounting policies, accounted for retrospectively.
Basic earnings per share
Profit (loss) attributable to the ordinary equity holders of the Company
13.3 cents
20.7 cents
Diluted earnings per share
Profit (loss) attributable to the ordinary equity holders of the Company
13.0 cents
20.7 cents
2022
2021
The above EPS includes the impact of significant items on profit. Refer to Note 2.4.
Earnings used in calculating earnings per share
Profit attributable to the ordinary equity holders of the Company used in calculating
basic and diluted earnings per share.
Weighted average number of shares used as the denominator
Weighted average number of ordinary shares outstanding during the half year used in
the calculation of basic earnings per share.
Weighted average number of ordinary shares outstanding during the year used in the
calculation of diluted earnings per share.
2022
$’000
2021
$’000
211,039
318,015
2022
Number
2021
Number
1,584,458,865
1,537,982,583
1,623,799,141
1,538,045,684
85
Notes to the Financial Statements for the year ended 25 June 2022 Section 3:
Working Capital
3.1. Cash and Cash Equivalents
Accounting policy
Cash and cash equivalents in the statement of financial position and statement of cash flows includes cash on hand and deposits held at call or
with maturities of three months or less with financial institutions.
Cash at bank and on hand
Cash at banks earns interest at floating rates based on daily bank deposit rates.
2022
$’000
2021
$’000
37,938
253,332
The maximum exposure to credit risk at the reporting date is the carrying amount. The exposure to interest rate risk is discussed in note 6.6.
Reconciliation of operating profit (loss) after tax to net cash provided by operating activities
Profit for the year from continuing operations:
Loss for the year from discontinued operations:
Non-cash items:
Depreciation and amortisation of property, plant and equipment and intangible assets
Amortisation of Right of use assets
Amortisation of television program rights
Impairment of intangible assets and equity accounted investees
Reversal of previously Impaired right of use assets less impairment of right of use assets
Impairment of tangible assets
(Reversal) of intangible assets impairment
Share based payment expense
Dividend received from equity accounted investees less share of profit of equity
accounted investees
Movement in unamortised finance costs
Restructuring & redundancy costs
Onerous contract costs
Other non-cash items
Changes in operating assets and liabilities, net of effect from acquisitions:
(Increase) decrease in:
Trade and other receivables
Program rights
Other assets
Increase (decrease) in:
Trade and other payables
Program liabilities
Provisions
Other liabilities
Tax balances
Net cash inflow from operating activities
211,052
–
24,415
8,781
100,375
–
–
–
–
6,758
(318)
8,243
–
(12,847)
7,963
28,143
(69,955)
(1,294)
(27,138)
(61,737)
(79,808)
(26,040)
43,639
160,232
318,122
(34)
14,853
9,930
91,819
1,018
(4,437)
4,719
(208,498)
7,776
(6,322)
5,642
(4,863)
(55,842)
53,633
(55,592)
(103,218)
5,462
44,292
(1,673)
(75,283)
(18,766)
120,473
143,211
86
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 3.1. Cash and Cash Equivalents (continued)
Significant non-cash transactions
The Group engaged in the following significant non-cash investing and financing activities during the year:
Non-cash investing (outflow) inflow
Acquisition of other financial assets
Conversion of Financial Assets for Ordinary Shares
Acquisition of Ordinary Shares in exchange for Financial Asset
Total non cash investing (outflow) inflow
Non-cash financing (outflow) inflow
Repayment of unsecured bilateral revolving credit facilities
Drawdown of secured syndicated facility
Total non cash investing (outflow) inflow
[A] The Group invested in financial assets and issued contra revenue to investees.
3.2. Trade and Other Receivables
2022
$’000
2021
$’000
[A]
(25,000)
5,000
(5,000)
(25,000)
–
–
–
–
–
–
–
(750,000)
750,000
–
Accounting policy
Trade receivables
Trade receivables are recognised initially at the value of the
invoice sent to the customer and subsequently at the amounts
considered recoverable (amortised costs), less provision for
impairment. Trade receivables are generally settled within 30-90
days and are non-interest bearing. The Group provides goods
and services to substantially all of its customers on credit terms.
The collectability of trade receivables is reviewed on an ongoing
basis. The Group has applied the expected credit loss model
to determine the provision for doubtful debts. A provision for
impairment of trade receivables is used when there is objective
evidence that the Group will not be able to collect all amounts
due according to the original terms of receivables. Debtors which
are known to be uncollectable are written off by reducing the
carrying amounts directly.
The amount of the impairment loss of receivables is recognised in
profit or loss in other expenses. Subsequent recoveries of amounts
previously written off are credited against other expenses in
profit or loss.
Loans and other receivables
Loans and receivables are non-derivative financial assets
with fixed or determinable payments that are not quoted in
an active market.
They arise when the Group provides money, goods or services
directly to a third party. They are included in current assets,
except for those with maturities greater than 12 months after
the reporting period which are classified as non-current assets.
Loans and receivables are carried at estimated future cash flow
and are reviewed for impairment on an annual basis.
Current
Trade receivables
Provision for doubtful debts
Provision for sales credits and returns
Loans and other receivables
Total trade and other receivables
Movements in the provision for doubtful debts are as follows:
Balance at the beginning of the financial year
Acquired on business combination
Net movement in provision recognised during the year
Amount utilised
Balance at the end of the financial year
2022
$’000
2021
$’000
233,760
(6,285)
(21,711)
205,764
14,359
220,123
4,976
654
1,336
(681)
6,285
222,163
(4,976)
(20,832)
196,355
15,610
211,965
6,212
–
(804)
(432)
4,976
Refer to Note 6.6 regarding information on the Group’s exposure to credit and market risks, and impairment losses for trade and other receivables.
Refer to Note 7.5 regarding receivables from related parties.
87
Notes to the Financial Statements for the year ended 25 June 2022 3.2. Trade and Other Receivables (continued)
Key judgements, estimates and assumptions
Impairment of receivables
The provision for impairment of receivables assessment requires a degree of estimation and judgement. The level of provision is
assessed by taking into account the recent sales experience, the ageing of receivables, historical collection rates and specific
knowledge of the individual debtor’s financial position.
Estimates are used in determining the level of receivables that will not be collected. These estimates include factors such as
historical experience, the current state of the Australian economy and industry factors.
Refer to Note 6.6C for assessment of impact of COVID-19 on credit risk.
3.3. Program Rights and Inventories
Accounting policy
Program rights
Program rights includes both purchased rights and
produced programs.
Program rights are recognised at the earlier of when cash
payments are made or from the commencement of the rights
period of the contract.
Television program rights are carried at the lower of cost
less amortisation or net recoverable amount. Cost comprises
acquisition of program rights and, for programs produced using
the Group’s facilities, direct labour and materials and directly
attributable fixed and variable overheads. Revenue is derived
from the broadcast of advertisement on Seven channels and
digital assets, net of agency commissions, discounts and rebates.
The Group’s amortisation policy requires the amortisation
of purchased programs on a straight line basis over the
expected useful life.
The useful life of purchased programs is assessed at least
annually. Produced programs are expensed when broadcast.
Inventories
Inventories, which includes newsprint, paper, finished goods,
raw material and work in progress, are measured at acquisition
cost, cost of manufacturing or net realisable value. The net
realisable value is the estimated achievable selling price in the
ordinary course of business less the estimated costs through
to completion and the estimated necessary selling costs.
Current
Television program rights – cost less accumulated amortisation and impairment
Newsprint and paper – at cost
Non-current
Prepaid Television program rights
2022
$’000
2021
$’000
140,392
6,820
147,212
–
–
176,557
7,768
184,325
34
34
Program rights and inventory expense
Program rights and inventories recognised as an expense during the year ended 25 June 2022 amounted to $100,375,022 (2021: $91,819,161)
and $5,399,615 (2021: $6,551,348) respectively.
Key judgements, estimates and assumptions
The Group recognises program rights which are available for use. These are capitalised and amortised over the useful life of the content.
The assessment of the appropriate carrying value of these rights requires estimation by management of the forecast future cash flows
which will be derived from that content. This estimate is based on a combination of market conditions and the value generated from the
broadcast of comparable programs.
88
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 3.4. Trade and Other Payables
Accounting policy
Trade payables and accruals
Trade and other payables represent liabilities for goods and
services provided to the Group prior to the end of financial year
which are unpaid. The amounts are unsecured and are usually
paid within 30-60 days from the end of the month in which they
are incurred and may be interest bearing.
Television program liabilities
Television program liabilities are recognised from the
commencement of the rights period of the contract. Contract
payments made prior to commencement of the rights period are
included in television program rights and inventories as prepaid
program rights.
Current
Trade payables and accruals
Television program liabilities
Non-current
Derivative financial liabilities
Television program liabilities
3.5. Commitments
Year ended 25 June 2022
Capital expenditure commitments
Operating lease commitments
Contracts for purchase of television programs
and sporting broadcast rights
Contracts for employee services
Contracts for other services
Year ended 26 June 2021
Capital expenditure commitments
Operating lease commitments
Contracts for purchase of television programs
and sporting broadcast rights
Contracts for employee services
Contracts for other services
2022
$’000
2021
$’000
127,972
48,852
176,824
–
3,665
3,665
< 1 year
$’000
1–5 years
$’000
> 5 Years
$’000
1,140
7,212
307,065
52,997
37,978
406,392
–
22,989
486,187
20,047
60,571
589,794
–
5,944
–
–
1,873
7,817
147,846
109,121
256,967
1,881
5,133
7,014
Total
$’000
1,140
36,145
793,252
73,044
100,422
1,004,003
112
2,210
–
8,002
–
–
112
10,212
405,381
716,907
12,635
1,134,923
36,884
25,380
12,320
32,228
–
–
49,204
57,608
469,967
769,457
12,635
1,252,059
89
Notes to the Financial Statements for the year ended 25 June 2022 3.5. Commitments (continued)
Types of Commitments
Capital expenditure commitments
Commitments for the acquisition of property, plant and
equipment contracted for at the reporting date but not
recognised as liabilities.
Operating lease commitments
Operating lease commitments relate to minimum lease payments
on non-cancellable leases contracted for at the reporting date
but not recognised as liabilities. These leases are low value and
are not required to be accounted for under AASB16 Leases.
Payments made under operating leases (net of any incentives
received from the lessor) are charged to profit and loss on a
straight line basis over the period of the lease.
3.6. Contract Assets and Liabilities
Accounting policy
Contracts for purchase of television programs and
sporting broadcast rights
Commitments for minimum payments in relation to non-cancellable
purchase contracts of television programs and sporting broadcast
rights at the reporting date but not recognised as liabilities.
Contracts for employee services
Commitments for minimum payments in relation to non-cancellable
contracts for employee services at the reporting date but not
recognised as liabilities.
Contracts for other services
Commitments for minimum payments in relation to non-cancellable
contracts for other services at the reporting date but not recognised
as liabilities.
Contract assets and liabilities
Contract assets primarily relate to the Groups rights to consideration for work completed but not billed on programs commissioned for
third party customers. The contract assets are transferred to receivables at the point of delivery of an episode and acceptance by the
customer. This usually occurs when the Group issues an invoice to the customer. The contract liabilities primarily relate to the advance
consideration received from customers for sponsorships, for which revenue is recognised over time.
The following table provides information about the contract assets and contract liabilities from contracts with customers.
Current
Television Program Sales
Contract assets
Television Program Sales
Revenue received in advance
Contract liabilities
Non-current
Revenue received in advance – affiliation fees
Contract liabilities
2022
$’000
–
–
–
19,478
19,478
–
–
2021
$’000
2,468
2,468
9,788
17,317
27,105
5,042
5,042
Forward Bookings
The following table includes revenue from contracts signed before the reporting date that is to be recognised post the reporting period
(i.e. the performance obligations remain unsatisfied at the reporting date):
Revenue received in advance
Total
2023
$’000
19,478
19,478
2024
$’000
Beyond 2024
$’000
–
–
–
–
The Group recognised $27.1m in revenue during year ended 25 June 2022 that was previously accounted for as a contract liability.
90
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022
Section 4:
Other Key Balance Sheet Items
4.1. Intangible Assets
Accounting policy
Goodwill
Goodwill acquired in a business combination is initially measured
at cost. Cost is measured as the consideration and transaction
cost of the business combination minus the net fair value of
the acquired and identifiable assets, liabilities and contingent
liabilities. Following initial recognition, goodwill is measured
at cost less any accumulated impairment losses.
Refer to Note 4.1.1 for further details on impairment.
Intangible Assets
Intangible assets acquired separately are measured on initial
recognition at cost. The cost of intangible assets acquired in a
business combination is their fair value at the date of acquisition.
Costs incurred for internally developed software and websites
are capitalised and amortised over the estimated useful life of the
software or website. Costs that relate to the design and ongoing
maintenance of the internally developed software and websites
are expensed as incurred.
Software-as-a-Service (SaaS) arrangements are service
contracts providing the Group with the right to access the
cloud provider’s application software over the contract period.
As such, the Group does not receive a software intangible asset
at the contract commencement date. For SaaS arrangements,
the Group assesses if the contract will provide a resource that
it can ‘control’ to determine whether an intangible asset is
present. If the Group cannot determine control of the software,
the arrangement is deemed a service contract and any
implementation costs including costs to configure or customise
the cloud provider’s application software are recognised as
operating expenses when incurred.
Following initial recognition, intangible assets are carried at
cost less amortisation and any impairment losses. The useful
lives of intangible assets are assessed as either finite or indefinite.
Intangible assets with finite lives are amortised on a straight line
basis over their useful life and tested for impairment whenever
there is an indication that they may be impaired. Intangible
assets with indefinite lives are tested for impairment annually.
A summary of the policies applied to the Group’s intangible assets is as follows:
Goodwill
Useful life
Indefinite
No amortisation
Television licences
Indefinite
No amortisation
The West mastheads
Indefinite
No amortisation
Acquired
Acquired
Acquired
Amortisation method used
Internally generated or acquired
Required Rights
Finite (1-2 years)
Amortised on a straight line basis over its useful life Acquired
Customer
Relationships
Finite (2-9 years)
Amortised on a straight line basis over its useful life Acquired
Computer software
Finite (3–15 years)
Amortised on a straight line basis over its useful life
Internally developed and acquired
91
Notes to the Financial Statements for the year ended 25 June 2022 4.1. Intangible Assets (continued)
Licences
$’000
Mastheads
$’000
REF
Computer
software
$’000
Goodwill
$’000
Re-acquired
Rights and
Customer
relationships
$’000
Total
$’000
Year ended 25 June 2022
Opening net book amount
Additions
Additions through
Business Combinations
[A]
Disposals
Amortisation charge
670,277
–
–
–
–
Closing net book amount
670,277
–
–
–
–
–
–
10,003
2,470
946
(222)
(5,034)
–
–
–
–
680,280
2,470
27,398
19,314
47,658
–
–
–
(222)
(4,875)
(9,909)
8,163
27,398
14,439
720,277
2,300,000
119,555
99,185
1,263,481
19,314
3,801,535
(1,629,723)
(119,555)
(91,022)
(1,236,083)
(4,875)
(3,081,258)
Comprised of:
Cost
Accumulated amortisation and
impairment
Year ended 26 June 2021
Opening net book amount
Additions
Disposals
Amortisation charge
Reversal/(impairment)
[B]
208,498
Closing net book amount
670,277
461,779
–
–
–
–
–
–
–
–
–
13,234
1,876
(32)
(4,057)
(1,018)
10,003
–
–
–
–
–
–
–
–
–
–
–
–
475,013
1,876
(32)
(4,057)
207,480
680,280
Comprised of:
Cost
Accumulated amortisation and
impairment
2,300,000
119,555
95,991
1,236,083
–
3,751,629
(1,629,723)
(119,555)
(85,988)
(1,236,083)
–
(3,071,349)
[A] During the period the Group acquired intangible assets through acquisition of Prime Media Group. Refer to Note 7.4 for further details.
[B] The Group has performed an assessment of the recoverable amount for each of the Cash Generating Units (‘CGUs’) and groups of CGUs being
Television and The West (Metro and Regional). Refer to Note 4.1.1A for further details.
The reversals and impairments recognised during the prior year are a result of the following changes to key assumptions in the Group’s cash flow
forecasts:
Television
–
Improved market conditions for the traditional Free to Air television metro advertising market.
–
Regulatory changes in the media industry.
Refer to Note 4.1.1B for further details
The West
–
Further declines in circulation and advertising revenue in print publishing businesses.
92
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022
4.1. Intangible Assets (continued)
4.1.1 Impairment of non-financial assets
Accounting policy
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. Assets are grouped at the
lowest levels for which there are separately identifiable cash
inflows which are largely independent of the cash inflows from
other assets or groups of assets (cash generating units or CGUs).
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 cost to sell and its value in use.
In calculating the recoverable value, the cash flows include
projections of cash inflows and outflows from continuing use of
the CGU’s assets. For value-in-use models, the cash flows are
estimated for the assets of the CGU in their current condition and
discounted to their present value using a pre-tax discount rate that
reflects the current market assessments of the risks specific to the
CGU. For fair value less cost to sell models, the recoverable amount
is calculated by using discounted cash flow projections based on
financial budgets and forecasts covering a five-year period with
a terminal growth rate applied thereafter.
Non-financial assets other than goodwill that have been impaired
are reviewed for possible reversal of the impairment at each
reporting date. Impairment losses are recognised in profit and loss
unless the asset has previously been revalued, in which case the
impairment is recognised as a reversal to the extent of that previous
revaluation with any excess recognised in the profit and loss.
Key judgements, estimates and assumptions
Goodwill and intangible assets with indefinite useful lives are tested at least annually to determine if they have been impaired in
accordance with the Group accounting policy. The recoverable amounts of cash-generating units have been determined based on a
value-in-use approach. These calculations require the use of estimates and assumptions. Refer to 4.1.1B for details on assumptions used.
4.1.1A Allocation of goodwill and indefinite life assets
For the purpose of impairment testing, intangible assets with indefinite lives, including goodwill, are allocated to the Group’s operating
segments which represent the lowest level within the Group at which the assets are monitored for internal management purposes.
The table below outlines the allocation of goodwill and indefinite life assets:
Allocation of CGU Groups
Year ended 25 June 2022
Television
The West (Metro and Regional)
Other Business and New Ventures
Total goodwill and indefinite life assets
Year ended 26 June 2021
Television
The West (Metro and Regional)
Other Business and New Ventures
Total goodwill and indefinite life assets
Goodwill
$’000
Licences,
mastheads
$’000
Total
$’000
27,398
670,277
697,675
–
–
–
–
–
–
27,398
670,277
697,675
–
–
–
–
670,277
670,277
–
–
–
–
670,277
670,277
93
Notes to the Financial Statements for the year ended 25 June 2022 4.1. Intangible Assets (continued)
4.1.1B Impairment review of CGUs including goodwill
and indefinite life assets
In accordance with the Group’s accounting policies, the Group
has evaluated whether the carrying amount of a CGU or group of
CGUs exceeds its recoverable amount as at 25 June 2022. The
Group has determined the CGUs to be Television and The West
(Metro and Regional).
Valuation Methods
(i) Model
The recoverable amount was determined using a value-in-use model
by discounting the future cash flows expected to be generated from
the continuing use of the CGU.
Key components of the recoverable value calculations and the basis
for each CGU are detailed below:
(ii) Cash flows
Year 1 cash flows are based upon budgets for the next 12 months.
Future cash flows are based on the following assumptions:
Television
> The advertising market growth rates are assumed to be
consistent with industry market participant expectations
and long-term industry growth rates.
> The Group’s share of Metro Free to Air advertising takes into
account historical share performance and management’s
expectation of share in forward periods, taking into
consideration the impact of programming across the schedule.
> Expenses are assumed to increase by CPI and known fixed
increases for specific program rights.
The West
> Publishing revenue forecasts are management’s best estimates
using: current market data, industry forecasts and historical
actual rates.
> Digital revenue assumptions are in line with industry forecasts
and managements expectations of market development.
> Expenses are expected to decrease based on committed
cost reduction initiatives and volume assumptions.
(iii) Terminal growth factor
A terminal growth factor that estimates the long term growth
for that CGU is applied to the year 5 cash flows into perpetuity.
These terminal growth rates do not exceed long term expected
industry growth rates. The terminal growth factor for each CGU
is detailed below.
(iv) Discount rate
The discount rate is an estimate of the pre-tax rate that reflects
current market assessment of the time value of money and the risks
specific to the CGU.
The terminal growth factor, pre-tax and post-tax discount rate applied to the CGU’s cash flow projections are detailed below:
Terminal growth factor
Discount rate (pre-tax)
Discount rate (post-tax)
Jun-22
Jun-21
Jun-22
Jun-21
Jun-22
Jun-21
Television
The West – Metro
The West – Regional
0.0%
-0.5%
-0.5%
0.0%
-0.5%
-0.5%
14.4%
14.5%
14.2%
16.5%
13.5%
13.7%
9.7%
10.5%
10.5%
9.6%
10.5%
10.5%
(v) Allocation of impairment for The West
In prior periods, The West mastheads, licences and goodwill have been fully written down. In allocating the impairment to individual non-
current assets within the CGUs, their recoverable amount was not reduced below their fair value less cost of disposal; notably for property
related assets. Management’s assessment has shown no indicators of impairment reversal in the current period.
4.1.1C Impact of possible changes in key assumptions
The values assigned to the key assumptions represent management’s
assessment of future performance in each CGU based on historical
experience and internal and external sources. The estimated
recoverable amounts are highly sensitive to key assumptions.
The key assumptions in the value in use calculations (disclosed in
Note 4.1.1B) include metropolitan free to air (Metro FTA) market
growth rates, Metro FTA market share, BVOD, discount rate
and terminal growth rate. These assumptions are based on past
experience and the Group’s forecast operating and financial
performance for the Television CGU taking into account current
market and economic conditions, risks and uncertainties.
The group has assessed the impact on recoverable value of the CGU
of the following changes in key assumptions as part of its sensitivity
analysis (all other assumptions) held constant:
Key cashflow assumption
Change
Metro FTA market growth rate1
Metro FTA market share
BVOD market growth rate1
BVOD market share
Discount rate
Terminal growth rate
+/- 1%
+/- 1%
+/- 1%
+/- 1%
+/- 1%
+/- 1%
Impact on
recovable
value
$m
+/- 253
+/- 145
+/- 62
+/- 45
+/- 186
+/- 131
No sensitivity is presented for The West as all intangible and tangible
assets have been fully written down nil or their respective stand-
alone fair value.
1 Based on the model performed, the impact of the sensitivities have a
compounding effect on the recoverable value.
94
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 4.1. Intangible Assets (continued)
4.1.1D Prior Year reversal of prior period impairment
charges
In FY21, the operating results of the Television CGU, combined with
realised cost savings from the Group’s cost out initiatives and a
revision of assumptions for the broader advertising market resulted
in increased headroom when compared to most recent impairment
testing models from December 2020 and June 2020. In addition
to improved market conditions, regulatory changes in the Media
Industry arising from the Treasury Laws Amendment (News Media
4.2. Property, Plant and Equipment
Accounting policy
Measurement of cost
All property, plant and equipment is stated at historical cost less
accumulated depreciation and provision of impairment. Historical
cost includes expenditure that is directly attributable to the
acquisition of the items.
and Digital Platforms Bargaining Code) Bill 2021 has meant that
future segment revenue assumptions now include the revenue streams
arising from negotiations with other third parties impacted by the
Code. These regulatory changes represented a structural shift in the
Industry and as a result contributed to the increased headroom and
reversal of prior period impairment in June 2021 of $208,498,000 in
the Television CGU.
There have been no further impairment reversals in the current period.
Subsequent costs are included in the asset’s carrying amount or
recognised as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item
will flow to the Group and the cost of the item can be measured
reliably. The carrying amount of any component accounted for as
a separate asset is derecognised when replaced. All other repairs
and maintenance are charged to profit or loss during the reporting
period in which they are incurred.
Depreciation
Asset class
Land
Buildings
Useful life
Depreciation method used
Indefinite
Not depreciated
40 years
Straight line basis
Leasehold improvements
Finite
Shorter of the life of the lease of each property or the life
of the asset
Plant and equipment
Printing presses and publishing equipment
15 years
Other plant and equipment
3-10 years
Straight line basis to allocate their cost, net of their residual
values, over their estimated useful lives
Straight line basis to allocate their cost, net of their residual
values, over their estimated useful lives
Impairment of assets
The asset’s residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. An asset’s
carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated
recoverable amount. Gains and losses on disposals are determined by comparing proceeds with carrying amount and these are
included in profit or loss.
95
Notes to the Financial Statements for the year ended 25 June 2022 4.2. Property, Plant and Equipment (continued)
Year ended 25 June 2022
Opening net book value
Additions
Net additions through Business Combinations
[A]
[B]
Disposals
Depreciation charge
Change due to movement in FX rates
Closing net book amount
Comprised of:
Cost
Freehold land
and buildings
$’000
Leasehold
improvements
$’000
Plant and
equipment
$’000
Total
$’000
49,453
49,874
28,990
(18)
8,311
25,555
307
(5)
23,680
24,239
16,538
(13)
17,462
80
12,145
–
(819)
–
(1,866)
(11,822)
(14,507)
–
37
37
28,868
32,302
52,659
113,829
43,704
73,426
645,838
762,968
Accumulated depreciation and impairment
(14,836)
(41,124)
(593,179)
(649,139)
Year ended 26 June 2021
Opening net book value
Additions
Disposals
Depreciation charge
Impairment
Change due to movement in FX rates
Transferred in business disposal
Closing net book amount
Comprised of:
Cost
Accumulated depreciation and impairment
[C]
18,106
9,207
–
–
(644)
–
–
–
343
–
(925)
(314)
–
–
24,143
13,472
(31)
(9,227)
(4,405)
(238)
(34)
51,456
13,815
(31)
(10,796)
(4,719)
(238)
(34)
17,462
8,311
23,680
49,453
31,450
(13,988)
47,405
564,547
643,402
(39,094)
(540,867)
(593,949)
[A] Additions during the year include non-cash increases to make-good provisions. Refer to Note 4.4.
[B] During the period the Group acquired Property Plant and Equipment through acquisition of Prime Media Group. Refer to Note 7.4 for further details.
Additions from Prime Media Group have been presented net of GSTV assets disposed.
[C] Refer to Note 2.4 for details on prior year impairment.
Key judgements, estimates and assumptions
The estimation of useful life, residual value and depreciation methods require some judgement and are reviewed at least annually.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its
estimated recoverable amount. Gains and losses on disposals are determined by comparing the proceeds with carrying amount.
These are included in the income statement.
96
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022
4.3. Leases
4.3A Right of use assets
The Group leases many assets including offices, equipment, transmission towers and satellites.
The recognised right of use assets relate to the following types of assets:
Building
$’000
Plant &
Equipment
$’000
Comm-
unications
$’000
Year ended 25 June 2022
Opening net book amount
Additions
Net additions through Business Combinations
[A]
Disposals
Depreciation charge
Adjustment to cost
Effects of movement in exchange rates
Closing net book amount
Year ended 26 June 2021
Opening net book amount
Additions
Disposals
Depreciation charge
Impairment reversal/(expense)
Adjustment to cost
Effects of movement in exchange rates
Closing net book amount
68,141
1,000
1,775
(87)
(6,475)
(951)
39
63,442
80,940
355
–
(7,460)
4,597
(10,597)
306
68,141
Total
$’000
72,089
4,015
1,775
(87)
(8,781)
(951)
41
220
–
–
–
3,728
3,015
–
–
(156)
(2,150)
–
(2)
–
4
68
703
–
(77)
(246)
(160)
–
–
4,591
68,101
5,884
87,527
68
–
(2,224)
–
–
–
423
(77)
(9,930)
4,437
(10,597)
306
220
3,728
72,089
[A] During the period the Group acquired Leases through acquisition of Prime Media Group. Refer to Note 7.4 for further details.
4.3B Lease liabilities
The following tables show the discounted lease liabilities included in the Group statement of financial position and a maturity analysis of the
contractual undiscounted lease payments:
Lease liabilities
Current
Non-current
Total lease liabilities
Maturity analysis – contractual undiscounted lease payments
Less than one year
One to five years
More than five years
Total undiscounted lease payments
2022
$’000
12,141
186,239
198,380
27,455
100,847
223,431
351,733
2021
$’000
10,524
193,801
204,325
25,562
100,669
246,965
373,196
4.3C Lease liabilities – Rent Concessions
During the year the Group did not receive any rent concessions for lease payments as a result of COVID-19. COVID-19-Related Rent
Concessions was issued in May 2020 and permits lessees, as a practical expedient, not to assess whether particular rent concessions
occurring as a direct consequence of the COVID-19 pandemic are lease modifications and instead to account for those rent concessions
as if they are not lease modifications. The Group was not provided with any rent concessions in 2022 (2021: $736,000).
97
Notes to the Financial Statements for the year ended 25 June 2022 4.4. Provisions
Accounting policy
Provisions are:
> Recognised when the Group has a present legal or constructive obligation as a result of a past event, it is probable that an outflow
of resource will be required to settle the obligation and the amount can be estimated reliably.
> Measured at the present value of management’s best estimate of the expenditure required to settle the present obligation at the
end of the reporting period. The discount rate used to determine the present value is a pre-tax rate that reflects current market
assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage
of time is recognised as interest expense.
Provision
Description and measurement of provision
[A] Employee benefits
Provision for employee benefits includes annual leave, long service leave and short term incentives.
Short-term
employee benefits
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to
be settled within 12 months after the end of the reporting period in which the employee renders the
service. It is measured at the amounts expected to be paid when the liabilities are settled.
Long-term
employee benefits
Liability for long service leave which is not expected to be settled within 12 months after the end
of the period.
It is 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.
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 corporate bond rates with terms to maturity and currency that match, as closely
as possible, the estimated future cash flows.
Short term incentives
and bonus plans
A liability is recognised when there is an obligation to settle the liability and at least one of the
following conditions is met:
> there are formal terms in the plan for determining the amount of the benefit; or
> past practice gives clear evidence of the amount of the obligation.
[B] Redundancy
and restructuring
[C] Onerous Contracts
[D] Make Good Provision
Redundancy and restructuring provision is recognised when it is demonstrably committed to either
terminating the employment of current employees according to a detailed formal plan without
possibility of withdrawal or providing termination benefits as a result of an offer made to encourage
voluntary redundancy. It is payable when employment is terminated before the normal retirement
date, or when an employee accepts voluntary redundancy in exchange for these benefits.
Provision for onerous contracts represents contracts where, due to changes in market conditions,
the expected benefit is lower than the cost for which the Group is currently committed under the
terms of the contract. The minimum net obligation under the contract is provided for. The provision
is calculated as the net of the estimated economic benefit and the estimate of the committed cost
discounted to present values.
Make good provision to restore the leased premises of its offices, studios and other premises at
the end of the respective lease terms. A provision has been recognised for the present value of the
estimated expenditure required to remove any leasehold improvements.
Carrying amount at 26 June 2021
Additions through Business Combinations
Amounts provided/(reversed)
Amounts utilised
Unwind of discount
Balance as at 25 June 2022
Represented by:
Current
Non-current
Balance as at 25 June 2022
Employee
Benefits
[A]
$’000
Redundancy &
Restructuring
[B]
$’000
Onerous
Contracts
[C]
$’000
Make Good
Provision
[D]
$’000
59,833
5,524
28,727
(23,453)
–
70,631
63,200
7,431
70,631
4,672
174,570
310
44
(2,444)
–
2,582
2,582
–
2,582
–
(8,351)
(88,280)
1,419
79,358
38,961
40,397
79,358
10,374
496
26,495
(464)
355
37,256
506
36,750
37,256
Total
$’000
249,449
6,330
46,915
(114,641)
1,774
189,827
105,249
84,578
189,827
98
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022
4.4. Provisions (continued)
Key judgements, estimates and assumptions
The provision for restructuring and redundancy is in respect
of amounts payable in connection with restructuring and
redundancies, including termination benefits, on-costs,
outplacement and consultancy services.
For onerous provision, key assumptions made concerning
future events are:
> The economic benefits expected to be received under the
contracts is based on the historical benefits received on
similar television programming and sports rights, adjusted
to reflect the Group’s expectation of future growth/ decline
rates for the advertising market;
4.5. Other Financial Assets
Accounting policy
The Group classifies its investments in the following categories:
financial assets at fair value through profit or loss (FVTPL),
financial assets at fair value through other comprehensive income
(FVTOCI) and amortised cost financial assets. The classification
depends on the Group’s business model for managing the financial
asset as well as its contractual cash flow characteristics.
Movements in carrying amounts of other financial assets
Carrying amount at the beginning of the period
Contractual rights converted to Equity
Return of capital
Net change in fair value of financial assets at fair value
Acquisitions (disposals)
Foreign Currency revaluation
Carrying amount at the end of the year
> The costs of fulfilling the contract are estimated with reference
to contractual rates and historical incremental costs of similar
programming assumed to increase by CPI.
Dividends are recognised as income in profit or loss unless
the dividend clearly represents a recovery of part of the cost
of the investment.
2022
$’000
37,355
–
(5,459)
(33,996)
41,600
71
39,571
2021
$’000
79,135
4,500
–
506
(46,786)
–
37,355
Other financial assets represent equity investments in listed and unlisted entities comprising of View Media Group, RAIZ Invest Limited,
Money Me Limited, Open Money Group Pty Limited and a portfolio of other SWM Ventures.
During the year, the Group completed its acquisition of 100 per cent of the issued share capital of Prime Television (Holdings) Pty Limited
and its subsidiaries, and Seven Affiliate Sales from PRT Company Limited (formerly Prime Media Group Limited). On 4 February 2022 PRT
Company Limited made a payment of a fully franked dividend and a return of capital. Following the receipt of the dividend and return of
capital from PRT Company Limited, the fair value of the PRT Company Limited Shares were reduced to zero. A fair value loss of $19.1 million
was recognised in Other Comprehensive Income (reserves).
During the year, as a result of the Money Me Limited and Society One Merger, the Group disposed of its financial assets in Society One
for shares in the listed company Money Me Limited.
Acquisitions during the period were made using a mix of cash and contra advertising agreements. Refer to Note 3.1.
Key judgements, estimates and assumptions
The fair value of other financial assets that are measured through a Level 3 (significant unobservable inputs) approach under the
accounting standard AASB 13 Fair Value Measurement. The valuation technique used was based on the equity price established in the
most recent round of equity financing and consideration of any other key changes in the investment which requires a level of judgement.
99
Notes to the Financial Statements for the year ended 25 June 2022 Section 5:
Taxation
5.1. Taxes
Accounting policy
Current taxes
Current tax assets and liabilities are measured at the amount
expected to be recovered from or paid to taxation authorities at
the tax rates and tax laws enacted or substantively enacted by
the balance sheet date.
Offsetting deferred tax balances
Deferred tax assets and deferred tax liabilities are offset only if a
legally enforceable right exists to set off current tax assets against
current tax liabilities and the deferred tax assets and liabilities
relate to the same taxable entity and the same taxation authority.
Deferred taxes
Deferred income tax liabilities are recognised for all taxable
temporary differences. Deferred income tax assets are recognised
for all deductible temporary differences, carried forward unused
tax losses, to the extent it is probable that taxable profit will be
available to utilise them.
Tax consolidation
The Company and its wholly-owned Australian resident
entities are part of a tax consolidated group. As a consequence,
all members of the tax consolidated group are taxed as a single
entity. The head entity within the tax consolidated group is Seven
West Media Limited.
The carrying amount of deferred income tax assets is reviewed
at balance sheet date and reduced to the extent that it is no
longer probable that sufficient taxable profit will be available
to utilise them.
The measurement of deferred tax reflects the tax consequences
that would follow from the manner in which the Group expects,
at the reporting date, to recover or settle the carrying amount
of its assets and liabilities. In making this assessment, the Group
considers the tax consequences of recovering assets and liabilities
through sale, use and subsequent sale or through use and then
abandonment or scrapping of the asset.
Deferred income tax assets and liabilities are measured at the
tax rates that are expected to apply to the year when the asset is
realised or the liability is settled, based on tax rates and tax laws
that have been enacted or substantively enacted at the balance
sheet date.
Deferred income tax is provided on temporary differences at
balance sheet date between accounting carrying amounts and
the tax bases of assets and liabilities, other than for the following:
> Where they arise from the initial recognition of an asset or
liability in a transaction that is not a business combination
and at the time of the transaction affects neither the
accounting profit nor taxable profit or loss.
> Where taxable temporary differences relate to investments
in subsidiaries, associates and interests in joint ventures:
(i) Deferred tax liabilities are not recognised if the timing of
the reversal of the temporary differences can be controlled
and it is probable that the temporary differences will not
reverse in the foreseeable future.
(ii) Deferred tax assets are not recognised if it is not
probable that the temporary differences will reverse
in the foreseeable future and taxable profit will not be
available to utilise the temporary differences.
Deferred tax liabilities are also not recognised on recognition
of goodwill.
Income taxes relating to items recognised directly in equity
are recognised in equity and not in the income statement.
Current tax expense/income, deferred tax liabilities and deferred
tax assets arising from temporary differences of the members
of the tax-consolidated group are recognised in the separate
financial statements of the members of the tax-consolidated
group using the group allocation approach by reference to the
carrying amounts of assets and liabilities in the separate financial
statements of each entity and the tax values applying under
tax consolidation.
Any current tax liabilities (or assets) and deferred tax assets
arising from unused tax losses of the Company or its subsidiaries
are ultimately assumed by the head entity in the tax consolidated
group and are recognised as amounts payable/(receivable) to/
(from) other entities in the tax consolidated group in conjunction
with any tax funding arrangement amounts (refer below).
Prime Media Group joined the tax consolidated Group of Seven
West Media Limited effective 31 December 2021.
Nature of tax funding arrangements
The head entity, in conjunction with other members of the tax-
consolidated group, has entered into a tax funding arrangement
which sets out the funding obligations of members of the tax-
consolidated group in respect of tax amounts. The tax funding
arrangements require payments to the head entity equal to the
current tax liability assumed by the head entity resulting in a
related party payable to the head entity equal in amount to the
current tax liability assumed. This related party balance is at call.
Contributions to fund the current tax liabilities are payable
as per the tax funding arrangement and reflect the timing of the
head entity’s obligation to make payments for tax liabilities to
the relevant tax authorities.
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.
100
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 5.1 Taxes (continued)
Accounting policy (continued)
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised exclusive
of the amount of associated GST, unless the GST incurred is
not recoverable from the taxation authority. In this case it is
recognised as part of the cost of the acquisition of the asset
or as part of the expense.
Tax expense recognised in profit or loss
Current year tax expense
Adjustments for current tax of prior periods
Current tax expense
Deferred tax benefit (expense)
Adjustment for deferred tax of prior periods
Total tax expense
Reconciliation of tax expense to prima facie tax payable
Profit before tax from continuing operations
Loss before tax from discontinued operations
Total profit before tax
Tax expense at the Australian tax rate of 30% (2021: 30%)
Receivables and payables are stated inclusive of the amount of
GST receivable or payable. The net amount of GST recoverable
from, or payable to, the taxation authority is included within other
receivables or payables in the balance sheet.
Cash flows are presented on a gross basis. The GST components
of cash flows arising from investing or financing activities which
are recoverable from, or payable to the taxation authority, are
presented as operating cash flows.
2022
$’000
(71,941)
5,010
(66,931)
(7,485)
2,077
2021
$’000
(51,432)
(120)
(51,552)
(76,556)
609
(72,339)
(127,499)
283,391
445,621
–
283,391
(85,017)
(34)
445,587
(133,676)
88
–
4,586
(1,688)
777
2,954
(1,126)
7,087
300
4,690
–
–
–
1,883
(1,185)
489
Tax effect of amounts which are not (deductible)/taxable in calculating taxable income:
Share of net profit of equity accounted investees, net of dividends received
Capital tax losses utilised for which no deferred tax asset was previously recognised
Dividend received
Transaction costs
Accounting gain on sale of assets
Non-assessable income
Other non-assessable items
Adjustments for tax of prior periods
Tax (expense) at the Australian tax rate of 30% (2021: 30%)
(72,339)
(127,499)
Tax recognised in other comprehensive income
Cash flow hedges
Financial assets at fair value
Trade and other payables
Deferred tax asset not recognised
–
10,216
(1,638)
(1,326)
(555)
–
Capital losses and deductible temporary differences
1,175,054
1,193,718
Key judgements, estimates and assumptions
In determining the amount of current and deferred tax, the Group takes into account the impact of uncertain tax positions and whether
additional taxes and interest may be due. This assessment relies on estimates and assumptions and may involve a series of judgements
about future events. New information may become available that causes the Group to change its judgement regarding the adequacy of
existing tax liabilities. Such changes to tax liabilities will impact tax expense in the period that such a determination is made.
101
Notes to the Financial Statements for the year ended 25 June 2022 5.2. Deferred Tax Assets and Liabilities
Deferred tax assets (liabilities)
Year ended 25 June 2022
Deferred tax
balances
transferred
from Business
Combinations
$’000
27 June
2021
$’000
Recognised
in profit
or loss
$’000
Recognised
in other
comprehensive
income
$’000
The balance comprises temporary differences attributable to:
Trade and other receivables
Program rights and inventories
Investments
Intangible assets
Property, plant and equipment
Leases
Deferred expenses and prepayments
Trade and other payables
Provisions
Deferred income
Borrowings
Transaction costs
Other
Year ended 26 June 2021
The balance comprises temporary differences attributable to:
Trade and other receivables
Program rights and inventories
Investments
Intangible assets
Property, plant and equipment
Leases
Deferred expenditure and prepayments
Trade and other payables
Provisions
Deferred income
Borrowings
Cash flow hedges
Transaction costs
Other
4,099
(92,337)1
(3,858)
499
–
–
(201,387)
(5,487)
21,921
40,255
1,793
16,109
58,580
3,147
1,697
42
3,775
–
–
–
443
1,898
217
–
–
164
(2,266)
27 June
2020
$’000
4,482
(96,070)
(7,993)
(136,345)
26,885
41,146
(252)
8,284
549
17,387
1,635
8,828
(10,003)
(2,176)
(1,793)
3,014
(3,830)
(8,999)
(1,697)
7
(8,330)
(5,408)
(383)
25,033
4,690
(65,042)
(4,964)
(891)
2,045
7,825
103,824
(45,244)
5,688
–
1,326
145
1,844
(2,541)
1,697
–
(103)
1,931
25 June
2022
$’000
5,147
(74,950)
7,993
(198,046)
11,918
38,079
-
17,928
56,648
(5,635)
–
49
(4,391)
26 June
2021
$’000
4,099
(71,037)
(3,858)
(201,387)
21,921
40,255
1,793
16,109
58,580
3,147
1,697
–
42
3,775
–
–
10,216
–
–
–
–
(1,638)
–
–
–
–
–
–
–
(555)
–
–
–
–
–
–
–
–
(1,326)
–
–
Net deferred tax assets/(liabilities)
(146,164)
8,578
(145,260)
1
The opening balance has been updated to reflect the impact of an amended prior period tax return.
Recognised
in profit
or loss
$’000
Recognised
in other
comprehensive
income
$’000
Net deferred tax (liabilities) assets
(47,036)
(75,947)
(1,881)
(124,864)
102
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 Section 6:
Capital Management
6.1. Borrowings
Accounting policy
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised
cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over the
period of the borrowings. Any related accrued interest is included in trade payables and accruals.
Non-current
Borrowings – secured
Unamortised refinancing costs
Borrowings net of unamortised refinancing costs
2022
$’000
2021
$’000
300,000
(5,571)
500,000
(6,690)
294,429
493,310
6.1A Financial arrangements
As at 25 June 2022, the Group had access to secured revolving
syndicated facilities to a maximum of $600,000,000 (2021 secured
syndicated facilities: $500,000,000). The amount of these facilities
undrawn at reporting date was $300,000,000 (2021: $nil).
In addition, the Group continues to have access to a $13,400,000
(2021: $13,400,000) multi-option facility with Australia and New
Zealand Banking Group Limited. As at reporting date, $12,169,614
of this facility (2021: $11,646,470) was utilised for the provision of
bank guarantees.
In October 2021, the Group entered into a secured revolving
syndicated facility agreement with an October 2024 maturity.
The lenders hold a first ranking general security over the Group’s
assets and a mortgage over the freehold properties in Broome
and Mt Coot-tha.
Under the terms of the new debt facility agreement, the previous
minimum liquidity requirements and minimum EBITDA test were
replaced by semi annual total leverage ratio and total interest
cover tests. The Group’s has been in compliance with its financial
covenants to date, including the period ended 25 June 2022.
The facilities are subject to a weighted average interest rate of 3.54%
at 25 June 2022 (2021: 4.58%).
Fair value
The carrying amount and fair value of Group borrowings at the end
of the financial year was $300,000,000 (2021: $500,000,000).
Risk exposures
Information about the Group’s exposure to interest rate changes is
provided in Note 6.6.
6.2. Share Capital
Accounting policy
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.
Ordinary shares are fully-paid and have no par value. They carry one vote per share and the right to dividends. They bear no
special terms or conditions affecting income or capital entitlements of the shareholders.
1,590,118,239 (June 2021: 1,538,034,368) Ordinary shares fully paid
[A]
3,432,966
3,405,666
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up the company in proportion to the number of and
amounts paid on the shares held. On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to
one vote, and upon a poll each share is entitled to one vote.
[A] The Group issued 40,833,871 ordinary shares at $0.495 per share on 1 September 2021 and 11,250,000 ordinary shares at $0.63 per share on
25 November 2021 as part of the Seven West Media’s Employees and Executives Short Term Incentive Plan. As at 25 June 2022, the Group held
80,277,577 (June 2021: 193,706) of the Company’s own shares which is disclosed in reserve for own shares in Note 6.3.
2022
$’000
2021
$’000
103
Notes to the Financial Statements for the year ended 25 June 2022 6.3. Reserves
Accounting policy
(i) Cash flow hedge reserve
The cash flow hedge reserve is used to recognise the effective
portion of gains or losses on derivatives that are designated and
qualify as cash flow hedges.
(iv) Foreign currency translation reserve
Exchange differences arising on translation of the foreign
controlled entity are recognised in other comprehensive income
in a separate reserve within equity.
(ii) Reserve for own shares
Treasury shares are shares in Seven West Media Limited that are held
by the SWM Equity Incentive Plan Trust that are to be transferred
to employees under the Group’s employee share scheme.
(iii) Equity compensation reserve
The share based payments reserve is used to recognise the grant
date fair value of incentive shares issued to eligible employees
with performance related conditions. Once the vesting conditions
of the respective share schemes are met and the shares are
exercised, the accumulated amount of the share based payment
reserve relating to the vested shares is transferred to share capital.
The cumulative amount is reclassified to profit or loss when the
net investment is disposed of.
(v) Fair value reserve
Fair value reserve is used to recognise the valuation of the
Group’s accounting for other investments as fair value through
other comprehensive income.
Equity compensation reserve
Reserve for own shares
Foreign currency translation reserve
Fair value reserve
Total Reserves
2022
$’000
17,407
(45,221)
446
(8,169)
(35,537)
2021
$’000
10,649
(597)
(57)
12,771
22,766
6.3A Movements in reserves
Movements in each class of reserve during the current and previous financial year are set out below:
Balance at 28 June 2020
Cash flow hedge gain(losses) taken to equity
Foreign currency translation differences
Tax on other comprehensive income
Net change in fair value of financial assets
(net of tax)
Share based payment expense
Balance at 26 June 2021
Balance as at 27 June 2021
Foreign currency translation differences
Net change in fair value of financial assets
(net of tax)
Share based payment expense
Shares bought on market
Shares issued pursuant to vesting of
executive and employee share plans
Balance at 25 June 2022
Cash flow
hedge
reserve
$’000
Equity
compensation
reserve
$’000
Reserve
for own
shares
$’000
Foreign
currency
translation
reserve
$’000
Fair value
reserve
$’000
Total
$’000
(3,094)
4,420
–
(1,326)
–
–
–
–
–
–
–
–
–
–
2,873
(597)
(32)
12,820
11,970
–
–
–
–
7,776
10,649
10,649
–
–
6,758
–
–
–
–
–
–
–
(597)
(597)
–
–
–
(17,324)
(27,300)
–
(25)
–
–
–
(57)
(57)
503
–
–
–
–
–
–
–
(49)
–
4,420
(25)
(1,326)
(49)
7,776
12,771
22,766
12,771
22,766
–
503
(20,940)
(20,940)
–
–
–
6,758
(17,324)
(27,300)
17,407
(45,221)
446
(8,169)
(35,537)
104
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 6.4. Dividends
Accounting policy
Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the entity,
on or before the end of the reporting period but not distributed at the end of the reporting period.
6.4A Dividends
There were no dividends paid during the financial year (2021:nil) or subsequent to year end (2021: nil).
6.4B Dividends not recognised at year end
No final dividend has been declared in the current or prior year.
6.4C Franked dividends
Franked dividends declared will be franked out of existing franking credits or out of franking credits arising from the receipt of franked
dividends and the payment of tax in the year ending 25 June 2022.
Franking credits available for subsequent financial years based on a tax rate of 30% (2021: 30%)
2022
102,165
2021
62,650
The above amounts represent the balance of the franking account as at the end of the financial year, adjusted for:
(a) franking credits that will arise from the payment of the current tax liability or receivable;
(b) franking debits that will arise from the payment of dividends recognised as a liability at the reporting date; and
(c) franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date.
6.5. Share-Based Payments
Accounting policy
Employees of the Group receive remuneration in the form of
share based payments, whereby employees render services as
consideration for equity instruments.
conditions but excludes the impact of any service and
non-market performance vesting conditions and the impact
of any non-vesting conditions.
Share-based compensation benefits are provided to executives
and employees in accordance with the Company’s share purchase
and loan plans and employment agreements.
Equity-settled transactions
The fair value of the rights granted 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 rights granted, which includes any market performance
Non-market vesting conditions are included in assumptions about
the number of rights 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 entity revises its estimate of the number
of rights 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.
105
Notes to the Financial Statements for the year ended 25 June 2022 6.5. Share-Based Payments (continued)
6.5A Performance and share rights granted as compensation
The total expense recognised for the LTI share-based payments for all plans during the financial year for the Group was $2.3 million
(2021: $2.1 million). The total expense for the STI share-based payments for all the plans during the financial year for the Group was
$4.3 million (2021: $4.8 million).
The accounting value of share-based payments may be negative where an executive’s share-based expense includes cumulative adjustments
for changes in non-market vesting conditions.
Long Term Incentive Plans
At 25 June 2022, performance rights that remain outstanding are from 2020, 2021 and 2022 Long Term Incentive Plans.
The Group issued one tranche in 2022 for the long term incentive plan that entitles key management personnel to performance rights.
Holders of vested rights are entitled to fully paid ordinary shares in the Company.
A total of 6,588,597 (2021: 22,968,748) performance rights were granted on 26 November 2021 (2021: 1 December 2020) and will be awarded
when the performance conditions are met. The performance period commenced on 1 July 2021 and ends on 30 June 2024 (2021: 1 July 2020 to
30 June 2023). The performance rights are subject to a total shareholder return (TSR) hurdle as well as an individual performance condition.
Performance rights do not carry any dividend or voting rights prior to vesting and are all equity settled. Vesting of the rights are subject to the
condition that the executive remains employed by the Company at the vesting date. During the year 53,964,242 rights for LTI and STI vested
and 367,685 rights lapsed.
6.5B Valuation models and key assumptions used
Grant date
Award type
Vesting Conditions
Performance period
Vesting Date
Share price at grant date
Number of rights granted
Fair value at grant date
Volatility – Seven West Media
Risk free interest rate
Dividend yield
Valuation methodology
2022 Long Term
Incentive Plan
26 November 2021
Performance Rights
Absolute TSR
1 July 2021 to 30 June 2024
20 August 2024
$0.600
6,588,597
$0.405
64%
0.86%
0.0%
Monte-Carlo simulation
Short Term Incentive Plans
In FY22, the Company’s underlying EBIT result of $309.0 million opened the financial gateway. Refer to the Remuneration Report on pages 50
to 70 for further details.
The estimated number and fair value of the restricted shares as at 25 June 2022 is based on 50 per cent of the pool awarded. The performance
period commenced on 27 June 2021 and ends on 25 June 2022.
Key judgements, estimates and assumptions
The Group measures the cost of equity transactions with employees by reference to the fair value of equity instruments at the date at
which they are granted. The fair value is determined by an external valuer using a valuation model. The most appropriate valuation model
used is dependent on the terms and conditions of the grant. The estimate also requires determination of the most appropriate inputs into
the valuation model including the expected life of the share options, volatility and dividend yield and making assumptions about them.
106
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 6.6. Capital and Financial Risk Management
6.6A Accounting classifications and fair values
The following table shows the carrying amounts and fair values of financial assets and financial liabilities. It does not include fair value
information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation
of fair value.
Financial assets (liabilities) measured at fair value
Other financial assets
Financial assets (liabilities) measured at amortised cost
Trade and other receivables
Cash and cash equivalents
Borrowings
Trade payables and accruals
6.6B Measurement of fair values
Valuation techniques and significant unobservable inputs
The fair value of financial assets and liabilities must be estimated
for recognition and measurement or for disclosure purposes.
The carrying amounts of financial instruments disclosed in the
statement of financial position approximate to their fair values.
AASB 7 Financial Instruments: Disclosures requires disclosure
of fair value measurements by level of the following fair value
measurement hierarchy:
Note
4.5
3.2
3.1
6.1
3.4
2022
$’000
39,571
39,571
220,123
37,938
(294,429)
(127,972)
(164,340)
2021
$’000
37,355
37,355
211,965
253,332
(493,310)
(147,846)
(175,859)
(a) quoted prices (unadjusted) in active markets for identical assets
(b)
(c)
or liabilities (level 1).
inputs other than quoted prices included within level 1 that are
observable for the asset or liability, either directly (as prices)
or indirectly (derived from prices) (level 2), and
inputs for the asset or liability that are not based on observable
market data (unobservable inputs) (level 3).
The following table shows the valuation techniques and measurement level inputs used to assess the fair value of financial assets and financial
liabilities at 25 June 2022.
Type
Valuation Technique
Other Financial Assets
– Listed Entities
The fair value is based on quoted prices (unadjusted) in active
markets for identical assets or liabilities that can be accessed
at the measurement date.
Other Financial Assets
– Unlisted Entities
The fair value is based on the equity price established in the most
recent round of equity financing and consideration of any other
key changes in the investment which requires a level of judgement.
Measurement
Level
Amount
Level 1
$10,762,082
Level 3
$28,808,838
Assessment of fair value of Other (unlisted) investments
The fair value of other financial assets is measured through a
Level 3 (significant unobservable inputs) approach under AASB 9.
This methodology included using
> The issue prices in the most recent round of equity raising
conducted by each company assuming this was in the last
12 months; and
> Comparison of issue price movements to listed peers over
the same period; and
> Consideration of the investment method and the Group’s current
and forecasted valuation date.
107
Notes to the Financial Statements for the year ended 25 June 2022 6.6C Risk management framework
The Group’s activities expose it to a variety of financial risks:
market risk (including interest rate risk), credit risk, capital risk
and liquidity risk.
The Group’s overall risk management program focuses on the
unpredictability of financial markets and seeks to minimise potential
adverse effects on the financial performance of the Group.
The Group uses derivative financial instruments to hedge certain
interest rate risk exposures and forward foreign exchange contracts
to hedge certain foreign exchange risk exposures. Derivatives
are exclusively used for hedging purposes, i.e. not as trading or
other speculative instruments. The Group uses different methods
to measure the different types of risk to which it is exposed. These
methods include, sensitivity analysis in the case of interest rate and
foreign exchange and aging analysis for credit risk.
6.6C(i) Credit risk
Credit risk is the risk of financial loss to the Group if a customer or
counterparty to a financial instrument fails to meet its contractual
obligations, and arises principally from, credit exposures to
customers, cash and cash equivalents and derivative financial
instruments.
The carrying amounts of financial assets and contract assets
represent the maximum credit exposure.
Trade receivables and contract assets
The Group’s exposure to credit risk is influenced mainly by the
individual characteristics of each customer. However, management
also considers the factors that may influence the credit risk of its
customer base, including the default risk associated with the industry
in which customers operate.
Each new customer is analysed individually for creditworthiness
before the Group’s standard payment and delivery terms and
conditions are offered. The Group’s review includes external ratings,
if they are available, financial statements, credit agency information
and industry information. Sale limits are established for each
customer and reviewed on a regular basis.
In monitoring customer credit risk, customers are grouped
according to their credit characteristics, including whether they
are an individual or a legal entity, their industry, trading history
with the Group and existence of previous financial difficulties.
An impairment analysis is performed at each reporting date
using a provision range matrix to measure expected credit losses.
The percentage used will depend on the risk profile of the debtors
at the time and may vary year on year. The provision rates are
based on days past due for groupings of various customer segments.
The calculation reflects the probability-weighted outcome and
reasonable and supportable information that is available at the
reporting date about past events, current conditions, and forecasts
of future economic conditions.
Set out below is the information about the credit risk exposure on the Group’s trade receivables and contracts assets using a provision
range matrix.
Year ended 25 June 2022
Expected credit loss rate
Estimated total gross carrying amount
Expected credit loss
Year ended 26 June 2021
Expected credit loss rate
Estimated total gross carrying amount
Expected credit loss
Past due but not impaired
Not past due
< 30 days
31–90 days
> 90 days
2.1%
224,323
(4,745)
1.6%
212,441
(3,416)
3.5%
6,598
(232)
4.3%
7,648
(332)
37.3%
2,353
(878)
55.5%
1,593
(884)
88.5%
486
(430)
71.5%
481
(344)
Total
$'000
233,760
(6,285)
222,163
(4,976)
> review of standard payment terms for all customers;
> negotiation of payment terms for aged amounts, stop on
overdue accounts; and
> where increased risk was identified the Group moved to
tighten credit policy, ensure payments were received per
current trading terms, seek additional director guarantees
in some circumstances, and moved some debtors to full
or partial prepayment terms or reduced credit limits.
The above procedures and ongoing COVID-19 impact has
not resulted in recognition of additional credit loss provisions
(2021: nil) during the year.
Impact of COVID-19 on assessment of Credit Risk
The Group’s exposure to credit risk is influenced by the individual
characteristics of each customer. Despite the continued advertising
market recovery in FY22, ongoing COVID-19 related business
closures, restrictions to trade resulting from state-wide lockdowns
and border closures in the first half of FY22, as well as significant
delay in international imports the Group has continued its review of
key factors impacting the credit risk of its customer base throughout
the financial year and again at balance date. The Group also noted
the Trade Credit Insurance industry restricting the level of cover in
high risk categories.
The group’s reassessment of credit risk for existing and new
customers included the following procedures in addition to
those already described in Note 6.6C(i) of this financial report:
> re-assessment of already approved trade credit terms of
customers trading in perceived high risk and high COVID-19
impacted industries, specifically those characterised by high
consumer discretionary spend patters such as travel & tourism,
automotive, property, construction and retail and consumer
goods businesses;
108
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 6.6. Capital and Financial Risk Management (continued)
6.6C(ii) Liquidity risk
Liquidity risk refers to the risk that the Group is unable to meet its
financial commitments as and when 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, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the
Group’s reputation.
Prudent liquidity risk management implies maintaining sufficient
cash and the availability of funding through an adequate amount
of committed credit facilities. The Group manages liquidity risk
by continuously monitoring forecast and actual cash flow and
monitoring the Group’s liquidity reserve on the basis of these
At 25 June 2022
Financial liabilities
Trade and other payables
Unsecured loans
Total financial liabilities
At 26 June 2021
Non-derivative financial liabilities
Trade and other payables
Unsecured loans
Total non-derivatives
Derivative financial liabilities
Net settled interest rate swaps and collars
Total derivatives
Total financial liabilities
cash flow forecasts. In addition, the Group had access to total
debt funding under its revolving syndicated debt facility equal to
$600,000,000, refer to Note 6.1 for additional details on the Group’s
borrowing activities for the year.
Maturities of financial liabilities
The table analyses the Group’s financial liabilities including interest
to maturity into relevant groupings based on their contractual
maturities.
The amounts disclosed in the table are the contractual undiscounted
principal and interest cash flows and therefore may not agree
with the carrying amounts in the statement of financial position.
For interest rate swaps, the cash flows have been estimated using
forward interest rates applicable at the end of the reporting period.
Less than
one year
$’000
Between
1 and 5 years
$’000
Total
contractual
cash flows
$’000
Carrying
amount –
liabilities
$’000
174,720
21,356
196,076
3,665
308,845
312,510
Less than
one year
$’000
Between
1 and 5 years
$’000
178,385
330,201
508,586
Total
contractual
cash flows
$’000
257,712
22,826
280,538
5,133
507,152
512,285
262,845
529,978
792,823
–
–
–
–
–
–
180,489
294,429
474,918
Carrying
amount –
liabilities
$’000
262,100
493,310
755,410
1,881
1,881
280,538
512,285
792,823
757,291
109
Notes to the Financial Statements for the year ended 25 June 2022 6.6. Capital and Financial Risk Management (continued)
6.6C(iii) Market risk
Market risk is defined as possible changes in market prices, such as foreign exchange rates and interest rates that will affect the fair value or
future cash flows of the Group’s financial instruments. The key components of market risks are:
(a) Price risk
Price risk refers to the risk of a decline in the value of a security or a portfolio. The Group is not exposed to significant price risk.
(b) Interest rate risk
Interest rate risk refers to the risks that the value of a financial instrument or its associated cash flows will fluctuate in response to changes in
market interest rates.
The Group’s main interest rate risk arises from long-term borrowings.
As at the end of the reporting period the Group had the following instruments:
Variable rate instruments
Cash at bank, on hand and at call
Weighted average interest rate
External borrowing facilities
Weighted average interest rate
Net exposure to cash flow interest rate risk
The Group’s current receivables generally do not bear interest.
2022
$’000
37,938
1.50%
300,000
3.54%
262,062
2021
$’000
253,332
1.50%
500,000
4.58%
246,668
Group sensitivity
Based on the Group’s outstanding floating rate borrowings at 25 June 2022, a change in interest rates of +/-1% per annum with all other
variables remaining constant would impact equity and after tax profit by the amounts shown below.
This analysis assumes that all other variables remain constant.
Net Profit/(Loss)
Net Equity
2022
$’000
2021
$’000
2022
$’000
2021
$’000
If interest rates were 1% higher with all other variables held constant:
(Decrease)
(2,100)
(3,500)
(2,100)
(3,500)
If interest rates were 1% lower with all other variables held constant:
Increase
2,100
3,500
2,100
3,500
(c) Foreign exchange risk
Foreign exchange risk refers to the risk that the value of a financial instrument or its associated cash flows will fluctuate due to changes in
foreign currency rates.
The Group has transactional currency risk; such exposure arises from sales or purchases by an operating unit in currencies other than the unit’s
measurement currency. It is the Group’s policy not to enter into forward contracts until a firm commitment is in place. The terms of the forward
currency contracts have been negotiated to match the terms of the commitments. Foreign currency contracts are used to reduce the exposure
to the foreign exchange risk. As at 25 June 2022, the Group does not have any cross-currency hedges.
As at the end of the reporting period, the Group did not have any material exposures to foreign exchange risk.
Based on the Group’s financial instruments held at 25 June 2022, had the Australian dollar weakened/strengthened by 10% against the US dollar,
Euro, UK pound and New Zealand dollar, with all other variables held constant, the Group’s equity and after tax profit for the year would not have
changed significantly. The analysis was performed on the same basis as 2021 and ignores any impact of forecasted sales and purchases.
110
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 Section 7:
Group Structure
7.1. Equity Accounted Investees
Non-current
Investments in associates and jointly controlled entities
16,153
15,835
2022
$’000
2021
$’000
Accounting policy
An associate is an entity, other than a subsidiary, over which
the Group has significant influence but not control. Significant
influence is the power to participate in the financial and operating
decisions of the entity with shareholding generally up to 50 per
cent of the voting rights.
A jointly controlled entity is an entity in which the Group holds an
interest under a contractual arrangement where the Group and
one or more other parties undertake an economic activity that is
subject to joint control.
Measurement
Interests in associates and jointly controlled entities are
accounted for using the equity method. They are initially
recognised at cost plus the investor’s share of retained post-
acquisition profits, impairment and other changes in net assets,
until significant influence or joint control ceases.
Dividends received or receivable from equity accounted investees
are recognised in the consolidated financial statements as a
reduction in the carrying amount of the investment.
When the Group’s share of losses equals or exceeds its interest
in an equity accounted investee, including any other unsecured
long-term receivables, the Group does not recognise further losses
unless it has incurred obligations or made payments on behalf of
the investee.
Unrealised gains arising from transactions with equity accounted
investees are eliminated against the investment to the extent of the
Group’s interest in the investee. Unrealised losses are eliminated in
the same way as unrealised gains, but only to the extent that there
is no evidence of impairment.
Impairment
Equity accounted investees are tested for impairment annually or
when indicators of impairments exist.
Information relating to associates and jointly controlled entities is set out in the tables below:
Name of entity
REF
Principal activities
HealthEngine Limited
NPC Media Pty Limited
Oztam Pty Limited
Starts at 60 Pty Limited
TX Australia Pty Limited
Mildura Digital Television Pty Limited
West Digital Television Pty Limited
West Digital Television No.2
Pty Limited
West Digital Television No.3
Pty Limited
West Digital Television No.4
Pty Limited
WA SatCo Pty Limited
Broadcast Transmission
Services Pty Limited
Reporting date
30 June
Online health directory
Playout and content managements services
30 June
Ratings service provider
31 December
Online social network for seniors
Transmitter facilities provider
[A]
[A]
[A]
Television licence holder
Television licence holder
Television licence holder
[A]
Television licence holder
[A]
Television licence holder
[A]
[A]
Television licence holder
Broadcast support service
30 June
30 June
30 June
30 June
30 June
30 June
30 June
30 June
30 June
Ownership interest
2022
%
16.3
50.0
33.3
35.3
50.0
50.0
50.0
50.0
50.0
50.0
50.0
50.0
2021
%
16.3
50.0
33.3
35.3
50.0
–
–
–
–
–
–
–
[A] Acquired as part of the acquisition of Prime Media Group, refer to Note 7.4 for further disclosure. These entities hold TV licences which have not
been valued as part of the acquisition.
111
Notes to the Financial Statements for the year ended 25 June 2022 7.1. Equity Accounted Investees (continued)
Below is the summarised financial information for the Group’s remaining associates and jointly controlled investments.
Net loss for the year
Group's share of profit for the year
REF
[B]
[B] Share of profit (loss) is based on ownership percentage up to 50% for each equity accounted investee.
Movements in carrying amount of equity accounted investees
Carrying amount at the beginning of the financial year
Share of profit of investees after tax
Acquisitions and other movements
[A]
2022
$’000
(368)
318
2022
$’000
15,835
318
–
2021
$’000
(84)
6,322
2021
$’000
9,513
6,322
–
Carrying amount at the end of the financial year
16,153
15,835
The carrying amount of each investment is based on the fair value of investments at acquisition date adjusted for equity accounted profits,
dividends, impairments and any other movement since acquisition.
The Group has not recognised losses in relation to its interests in equity accounted investees as the Group has no obligation in respect of
these losses.
7.2. Investments in Controlled Entities
Accounting policy
The consolidated financial statements incorporate the assets and
liabilities of all subsidiaries of Seven West Media Limited as at
25 June 2022 and the results of all subsidiaries for the year then
ended. Seven West Media Limited and its subsidiaries together are
referred to in this financial report as the Group.
The consolidated entity controls an entity when it is exposed
to, or has rights to, variable returns from its involvement with
the entity and has the ability to affect those returns through its
power over the entity. 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.
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.
Non-controlling interests in the results and equity of subsidiaries
are shown separately in the consolidated income statement,
statement of comprehensive income, statement of changes in
equity and statement of financial position respectively.
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the
accounting policy described above.
135 Nominees Pty Ltd
Albany Advertiser Pty Ltd
Another Story Productions Pty Limited
Australian National Television Pty Limited
Australian Television International Pty Limited
Australian Television Network Limited
Broadcast Production Services Pty Ltd
BTTR Production Pty Limited
BTW Productions Pty Limited
Channel Seven Adelaide Pty Limited
Channel Seven Brisbane Pty Limited
112
Notes
Country of
incorporation
[P]
[A]
[O]
[C]
[C]
[C]
[P]
[N]
[K]
[C]
[C]
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Ownership interest
2022
%
100
100
100
100
100
100
100
100
100
100
100
2021
%
–
100
100
100
100
100
–
100
100
100
100
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 7.2. Investments in Controlled Entities (continued)
Notes
Country of
incorporation
Ownership interest
2022
%
2021
%
Channel Seven Melbourne Pty Limited
Channel Seven Perth Pty Limited
Channel Seven Queensland Pty Limited
Channel Seven Sydney Pty Limited
Coast Australia Production Pty Limited1
Cobbittee Publications Pty Limited
Colorpress Australia Pty Ltd
ColourPress Pty Ltd
Community Newspaper Group Limited
ComsNet Pty Ltd
Dansted and McCabe Holdings Pty Ltd
Dodds Street Properties Pty Limited
Edinburgh Military Tattoo Sydney Production Pty Ltd
Endurance Media Limited1
Fam Time Productions Pty Limited
Faxcast Australia Pty Limited
Geraldton Newspapers Pty Ltd
Geraldton Telecasters Pty Ltd
Golden West Network Pty Ltd
Golden West Satellite Communications Pty Ltd
Great Southern Film and Television Pty Limited1
Great Southern Television Limited1
Harlesden Investments Pty Ltd
Herdsman Print Centre Pty Ltd
Herdspress Leasing Pty Ltd
Hocking & Co. Pty Ltd
Hybrid Television Services (ANZ) Pty Limited
Impact Merchandising Pty Limited
Jupelly Pty Limited
Kenjins Pty Limited
Mid West Television Pty Ltd
Mining Television Network Pty Ltd
Pacific Magazines Trust
Prime Digitalworks Pty Ltd
Prime Media Broadcasting Services Pty Ltd
Prime Media Group Services Pty Ltd
Prime New Media Investments Pty Ltd
Prime Properties (Albury) Pty Ltd
Prime Television (Holdings) Pty Ltd
Prime Television (Northern) Pty Ltd
Prime Television (Southern) Pty Ltd
Prime Television (Victoria) Pty Ltd
[C]
[C]
[C]
[C]
[C]
[A]
[A]
[L]
[A]
[A]
[C]
[M]
[C]
[A]
[P]
[P]
[P]
[A]
[A]
[A]
[A]
[I]
[E]
[C]
[C]
[P]
[P]
[P]
[P]
[P]
[P]
[P]
[P]
[P]
[P]
[P]
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
New Zealand
Australia
Australia
Australia
Australia
Australia
Australia
Australia
New Zealand
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
100
100
100
100
–
100
100
100
100
100
100
100
100
–
100
100
100
100
100
100
–
–
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
70
100
100
100
100
100
100
100
100
70
100
100
100
–
–
–
70
70
100
100
100
100
100
100
100
100
–
–
100
–
–
–
–
–
–
–
–
–
113
Notes to the Financial Statements for the year ended 25 June 2022 7.2. Investments in Controlled Entities (continued)
Notes
Country of
incorporation
Ownership interest
2022
%
2021
%
Prime Television Investments Pty Ltd
Quokka Press Pty Ltd
Quokka West Pty Ltd
Red Music Publishing Pty Limited
Red Publishing Pty Limited
Riverlaw Holdings Pty Limited
SBB Productions Pty Limited
Screenworld Pty Ltd
Seven Affiliate Sales Pty Ltd
Seven DS Holdings Pty Ltd
Seven Facilities Pty Ltd
Seven Investment Holding Pty Limited
Seven Investment Holding USA LLC
Seven Magazines Pty Limited
Seven Network (Operations) Limited
Seven Network Programming Pty Limited
Seven Productions NZ Limited
Seven Publishing (No 1) Pty Limited
Seven Publishing (No 2) Pty Limited
Seven Publishing (PP) Holdings Pty Limited
Seven Publishing (PP) Pty Limited
Seven Publishing MM Pty Limited
Seven Publishing NZ Limited
Seven Publishing NZ Merchant Company Limited
Seven Publishing Pty Limited
Seven Regional Operations Pty Limited
Seven Rights Pty Ltd
Seven Satellite Operations Pty Limited
Seven Satellite Pty Limited
Seven Studios Distribution Pty Ltd
Seven Studios Holdings Pty Ltd
Seven Studios Pty Limited
Seven Television Australia Limited
Seven Ventures Pty Limited
Seven West Media Investments Pty Limited
SMG H1 Pty Limited
SMG H2 Pty Limited
SMG H4 Pty Limited
SMG H5 Pty Limited
South West Printing and Publishing Company Ltd
Southdown Publications Pty Limited
114
[P]
[A]
[A]
[D]
[C]
[A]
[K]
[P]
[P]
[I]
[H]
[C]
[C]
[C]
[C]
[C]
[C]
[C]
[C]
[C]
[J]
[G]
[C]
[J]
[I]
[F]
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
United States of
America
Australia
Australia
Australia
New Zealand
Australia
Australia
Australia
Australia
Australia
New Zealand
New Zealand
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
[C]
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
[C]
[B]
[B]
[C]
[C]
[A]
[C]
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
–
100
100
100
100
100
100
–
–
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 7.2. Investments in Controlled Entities (continued)
Notes
Country of
incorporation
Ownership interest
2022
%
2021
%
Sunshine Broadcasting Network Limited
SWM Finance Pty Limited
SWM Media Holdings Pty Ltd
Telepro Pty Ltd
The Seven Publishing Plus Company Pty Limited
W.A. Broadcasters Pty Ltd
WAN Cinemas Pty Limited
West Australian Entertainment Pty Ltd
West Australian Newspapers Limited
West Central Seven Limited
Western Mail Operations Pty Ltd
Western Mail Pty Ltd
Westroyal Pty Ltd
Wide Bay - Burnett Television Limited
Zamojill Pty Ltd
Zangerside Pty Limited
Zed Holdings Pty Limited
1 Disposed of during the year, refer to Note 2.4.
[C]
[B]
[I]
[P]
[C]
[A]
[A]
[A]
[A]
[C]
[A]
[A]
[A]
[C]
[P]
[C]
[C]
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
–
100
100
100
100
100
100
100
100
100
100
–
100
100
The class of all shares is ordinary and the entities entered into the Deed of Cross Guarantee with Seven West Media Limited under ASIC
Corporations (wholly-owned companies) instrument 2016/785 by Assumption Deed on 8 April 2004. The dates below show when the deed
was amended:
[A] Prior to 30 June 2009.
[B] 20 June 2011.
[C] 26 June 2012.
[D] 18 April 2013.
[E] 30 September 2013.
[F] 1 May 2015.
[G] 16 June 2015.
[H] 31 March 2016.
[I] 1 December 2016.
[J] 12 May 2017.
[K] 5 February 2019.
[L] 24 June 2019.
[M] 24 April 2019.
[N] 25 November 2019.
[O] 17 May 2021.
[P] 25 January 2022.
Pursuant to ASIC Corporations (wholly-owned companies)
instrument 2016/785, certain wholly-owned subsidiaries,
as noted above, are relieved from the Corporations Act 2001
requirements for preparation, audit and lodgement of financial
reports and directors’ reports.
It is a condition of the Class Order that the ‘Holding Entity’ and
each of the wholly-owned subsidiaries enter into a Deed of Cross
Guarantee under which each company guarantees the debts of
the others.
Seven West Media Limited and its subsidiaries represent a ‘Closed
Group’ for the purposes of the Seven West Media Limited Class
Order, and as there are no other parties to its Deed of Cross
Guarantee that are controlled by Seven West Media Limited,
they also represent the ‘Extended Closed Group.’
115
Notes to the Financial Statements for the year ended 25 June 2022 7.2. Investments in Controlled Entities (continued)
7.2. Investments in Controlled Entities (continued)
The consolidated statement of profit or loss and other comprehensive income for the year ended 25 June 2022 of the Seven West Media
Limited Closed Group is presented below according to the Class Order:
2022
$’000
2021
$’000
1,530,053
1,254,814
1,092
37
1,531,145
1,254,851
(1,220,697)
(1,034,530)
–
–
3,728
2,590
–
–
8,351
–
318
325,435
1,385
(36,837)
(4,815)
285,168
(72,824)
212,344
–
212,344
–
503
–
(20,940)
(20,437)
191,907
207,480
1,249
470
3,445
4,863
(7,588)
66,728
1,230
6,322
504,520
1,501
(62,175)
(690)
443,156
(126,968)
316,188
2,683
318,871
4,420
(25)
(1,326)
(49)
3,020
321,891
Statement of profit or loss and other comprehensive income
Continuing Operations
Revenue
Other income
Revenue and other income
Expenses
Reversal of Intangible assets impairment
Reversal of investments and other assets impairment
Net income related to investments
Net gain on disposal of investments
Redundancy and restructure reversal (expense)
Onerous contracts
Reversal of onerous contracts
Other
Share of net profit of equity accounted investees
Profit (loss) before net finance costs and tax
Finance income
Finance costs
Write off of unamortised refinancing cost
Profit (loss) before tax from continuing operations
Tax expense
Profit (loss) for the year from continuing operations
Discontinued operations
Profit/(loss) after tax for the year from discontinued operations
Profit (loss) for the year
Other comprehensive income (expense)
Items that may be reclassified subsequently to profit or loss:
Effective portion of changes in fair value of cash flow hedges
Exchange differences on translation of foreign operations
Tax relating to items that may be reclassified subsequently to profit or loss
Items that will not be reclassified to profit or loss:
Net change in fair value of financial assets (net of tax)
Other comprehensive income for the year, net of tax
Total comprehensive income (expense) for the year
116
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 7.2. Investments in Controlled Entities (continued)
The consolidated statement of financial position for the year ended 25 June 2022 of the Seven West Media Limited Closed Group is presented
below according to the Seven West Media Limited Class Order:
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Contract assets
Program rights and inventories
Other assets
Total current assets
Non-current assets
Program rights
Equity accounted investees
Other financial assets
Property, plant and equipment
Intangible assets
Right of use assets
Other assets
Total non-current assets
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Lease Liabilities
Provisions
Deferred Income
Contract liabilities
Current tax liabilities
Total current liabilities
Non-current liabilities
Trade and other payables
Lease Liabilities
Provisions
Deferred Income
Contract liabilities
Deferred tax liabilities
Borrowings
Total non-current liabilities
Total liabilities
Net assets
EQUITY
Share capital
Reserves
Non-controlling interest
Accumulated deficit
Total equity
2022
$’000
2021
$’000
37,938
219,974
–
147,212
19,571
424,695
–
16,153
21,300
113,829
720,277
68,101
1,561
941,221
1,365,916
161,863
12,141
105,249
29,552
19,478
63,681
391,964
3,665
186,239
84,578
–
–
145,260
294,429
714,171
1,106,135
259,781
251,586
211,149
2,468
182,190
12,803
660,196
34
15,835
36,406
49,363
680,280
72,063
3,698
857,679
1,517,875
257,994
10,403
151,990
23,322
27,105
45,106
515,920
7,013
193,851
97,459
1,200
5,042
124,870
493,310
922,745
1,438,665
79,210
3,362,514
3,352,538
(67,149)
–
(26,097)
576
(3,035,584)
(3,247,807)
259,781
79,210
117
Notes to the Financial Statements for the year ended 25 June 2022 7.3. Parent Entity Financial Information
Accounting policy
The financial information for the Parent Entity, Seven West Media
Limited, has been prepared on the same basis as the consolidated
financial statements, except for:
(ii) Dividends received
Dividends received from subsidiaries are recognised in profit
and loss.
(i) Investments in subsidiaries
Investments in subsidiaries are accounted for at cost less
impairment losses in the financial statements.
(iii) Financial guarantees
Where the Parent Entity has provided financial guarantees in
relation to loans and payables of subsidiaries for no compensation,
the fair values of these guarantees are accounted for as
contributions and recognised as part of the cost of the investment.
7.3A. Summary of financial information
The individual financial statements for the Parent Entity show the following aggregate amounts:
Financial position of parent entity at year end
Current assets
Total assets
Current liabilities
Total liabilities
Total equity of the parent entity comprising of;
Share capital
Reserves
Asset revaluation reserve
Equity compensation reserve
Accumulated deficit
Profits reserve
Result of parent entity
Profit (loss) for the year
Total comprehensive income (expense) for the year
Parent entity
2022
$’000
155,611
192,537
99,846
100,170
2021
$’000
68,640
71,386
1,147
3,997
3,432,966
3,405,666
8,352
10,878
8,352
7,422
(3,960,553)
(3,954,775)
600,724
92,367
600,724
67,389
(5,778)
(5,778)
62,413
62,413
7.3B. Guarantees entered into by the parent entity
The Parent Entity has provided financial guarantees in respect of borrowings of a subsidiary amounting to $nil (2021: $nil).
There are cross guarantees given by Seven West Media Limited and its subsidiaries described in Note 7.2.
7.3C. Contingent liabilities of the parent entity
The Parent Entity did not have any contingent liabilities as at 25 June 2022 or 26 June 2021.
7.3D. Contractual commitments for the acquisition of property, plant or equipment
The Parent Entity had no contractual commitments for the acquisition of property, plant or equipment as at 25 June 2022 or 26 June 2021.
118
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 7.4. Business Combinations
Accounting policy
Accounting for acquisitions and business combinations
The acquisition method of accounting is used to account for all
business combinations, regardless of whether equity instruments
or other assets are acquired. The consideration transferred for
the acquisition of a subsidiary comprises the fair 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 asset or liability resulting from a 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.
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.
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,
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.
Seven Network (Operations) Limited, a wholly owned subsidiary of Seven West Media Limited, completed its acquisition of 100% of the issued
share capital of Prime Television (Holdings) Pty Limited and its subsidiaries, and Seven Affiliate Sales Pty Limited (Prime) from PRT Company
Limited (formerly Prime Media Group Limited) on 31 December 2021.
The acquisition of Prime has expanded the Group’s audience reach to more then 91% of Australia’s population each month, and is expected to
generate cost synergies as a result of the consolidation.
Prime Media Group was consolidated from 23 December 2021, the date of effective control. Subsequent to the half year accounts, acquisition
accounting has been performed and adjustments made to the carrying value of the Prime assets and liabilities acquired.
Aggregate details of the net assets acquired and consolidated are as follows:
Provisional1
2022
$’000
REF
Adjustment
Provisional
2022
$’000
Carrying value of net assets acquired
Cash and bank balances
Trade receivables and other assets
Program rights and Inventories
Property Plant and Equipment
Intangible assets
Re-acquired Rights
Customer Relationships
Right-of-use assets
Deferred tax assets (liabilities)
Trade payables and other liabilities
Provisions
Lease liabilities
Total carrying value of net assets recognised
Consideration payable
Difference between consideration and net assets recognised as Goodwill
Net Cash Flow
Payments for the acquisition of subsidiaries
Cash and cash equivalents acquired
Net cash inflow/(outflow)
1 Disclosed in the December 2021 Half Year financial report
23,367
37,662
4,515
16,486
18
–
–
2,658
1,607
(6,911)
(5,961)
(2,667)
70,774
124,241
53,467
–
(617)
(4,515)
12,630
928
12,971
6,343
(883)
(3,873)
(498)
(369)
1,002
23,119
(2,950)
(26,069)
23,367
37,045
–
29,116
946
12,971
6,343
1,775
(2,266)
(7,409)
(6,330)
(1,665)
93,893
121,291
27,398
–
(124,421)
23,367
23,367
–
(124,421)
(124,421)
23,367
(100,874)
119
Notes to the Financial Statements for the year ended 25 June 2022
7.4. Business Changes (continued)
Prior to acquisition, an affiliation agreement existed between the Group and Prime Media Group which was effectively settled as part of the
acquisition. Included in the Group’s balance sheet prior to acquisition, was deferred revenue in connection with an upfront payment under this
agreement. This amount, net of associated deferred tax asset, has been included as consideration in the acquisition accounting performed.
The goodwill arising on acquisition is primarily attributable to the synergies expected to be achieved from integrating Prime Media Group into
the Group’s operations.
For the year ended 25 June 2022, Prime Media Group contributed standalone revenue of $83.7 million and profit after tax of $6.3 million to
the Group’s results. Management estimates that if Prime Media Group had been owned by the Group for the full twelve month period, it would
have contributed revenue of $167.4 million and profit after tax of $12.6 million to the Group’s results.
During the period, the Group incurred transaction costs of $5.6 million related to the acquisition of Prime Media Group. These costs have been
included in significant items in the Consolidated Statement of Profit or Loss and Other Comprehensive Income.
Under accounting standards, the Group has 12 months from the date of acquisition in which to complete its assessment of the fair value of
assets and liabilities acquired. As at reporting date this assessment is ongoing.
7.5. Related Party Transactions
Accounting policy
Key management personnel transactions
Transactions were entered into during the financial year with
Equity Accounted Investments and Director Related Entities of
Seven West Media Limited and its controlled entities, which:
i. occurred within a normal customer or supplier relationship on
terms and conditions no more favourable than those which it is
reasonable to expect would have been adopted if dealing with
the Director or Director-related entity at arm’s length in the
same circumstances;
ii. do not have the potential to adversely affect decisions
about the allocation of scarce resources or discharge the
responsibility of the Directors; or
iii. are minor or domestic in nature.
7.5A Transactions with related parties
The following transactions occurred with related parties during the financial year:
Sale of goods, advertising and other services
Equity accounted investees
Other Related Entities2
Purchase of goods, advertising and other services
Equity accounted investees
Other Related Entities
Shareholder contribution
Equity accounted investees3
2022
$’000
1,067
651
24,037
12
Restated1
2021
$’000
735
1,132
20,702
10
400
1,000
1 As part of the Group’s review of related party relationships, it was identified that changes were required to the list of Related entities that were
included in the prior year comparatives.
2
The current year amount disclosed includes reimbursement from a related party, Australian Capital Equity Pty Ltd in relation to invoices that
were addressed to and paid for by Seven Network (Operations) Limited. These invoices were meant for Australian Capital Equity Pty Ltd and
once identified, they were promptly reimbursed. The decision to incur these costs was taken to defend a senior manager who was the subject
of negative reporting by other media outlets.
3 During the period the Group issued interest bearing loans to Equity accounted investees of $400,000 (2021: $1,000,000).For the year ended
25 June 2022, the Group has made an allowance for expected credit losses relating to the amounts owed by related parties of $400,000
(2021: nil). An impairment assessment is undertaken each financial year by examining the financial position of the related party and the
market in which the related party operates to determine whether there is objective evidence that a related party receivable is impaired.
When such evidence exists, the Group recognises an allowance for impairment loss.
120
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022 7.5. Related Party Transactions (continued)
7.5B Outstanding balances arising from sales/purchases of goods, advertising and other services
The following balances are outstanding at the end of the reporting period in relation to transactions with related parties:
Current receivables (sale of goods, advertising and other services)
Equity accounted investees
Other Related Entities
Current payables (purchase of goods, advertising and other services)
Equity accounted investees
Other Related Entities
2022
$’000
96
8
374
–
Restated1
2021
$’000
25
–
402
42
7.5C Parent entity
Seven West Media Limited is the ultimate Australian parent entity within the Group. There are no financial guarantees in respect of borrowings
of a subsidiary, no contingent liabilities and no contractual commitments.
7.5D Subsidiaries
Interests in subsidiaries are set out in Note 7.2.
7.5E Key management personnel compensation
In addition to their salaries, the Group also provides non-cash benefits to Directors and executive officers, and contributes to a post-
employment superannuation fund on their behalf.
Executive officers also participate in the Group’s Equity Incentive Plan for 2020, 2021 and 2022 (refer Note 6.5).
Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Superannuation
Share-based payments
Other long term benefits
2022
$’000
2021
$’000
8,105
7,919
226
4,052
81
12,464
210
3,808
77
12,014
Detailed remuneration disclosures in respect of Directors and each member of key management personnel are provided in the Remuneration
Report on pages 50 to 70.
Other transactions with key management personnel
A number of Directors of Seven West Media Limited also hold directorships with other corporations which provide and receive goods or
services to and from the Group in the ordinary course of business on normal terms and conditions. None of these Directors derive any direct
personal benefit from the transactions between the Group and these corporations.
121
Notes to the Financial Statements for the year ended 25 June 2022 Section 8:
Other
8.1. Remuneration of Auditor
During the year the following fees were paid or payable for services provided by the auditor of the parent entity and its related practices.
Auditors of the Company - KPMG
Audit or review of the financial statements
(i) Assurance services
Other assurance services
Total remuneration for audit and other assurance services
(ii) Other services
Taxation advice and compliance services
Transaction services
Total other services
Total remuneration of KPMG Australia
8.2. Contingent Liabilities
2022
$
2021
$
644,472
527,544
8,433
652,905
286,879
536,539
823,418
1,476,323
11,791
539,335
177,118
142,415
319,533
858,868
The Group’s tax liabilities have been calculated based on currently enacted legislation. Any changes to the tax law or interpretations (including
proposed changes already announced) may require changes to the calculation of the tax balances shown in the financial statements.
Participation in media involves particular risks associated with defamation litigation and litigation to protect media rights. The nature of the
Group’s activities is such that, from time to time, claims are received or made by the Group. The directors are of the opinion that there are no
material claims that require disclosure of such a contingent liability.
8.3. Events Occurring After The Reporting Date
Subsequent to year end, the Group has announced a 10 per cent on-market buyback to commence in August 2022.
Other than described above, there has not arisen any item, transaction or event of a material and unusual nature likely, in the opinion of the
Directors of the Company, to affect significantly the operations of the Group, the results of these operations, or the state of affairs of the
Group, currently or in future financail periods.
122
Financial Statements Seven West Media Limited Annual Report 2022Notes to the Financial Statements for the year ended 25 June 2022
8.4. Summary of Other Significant Accounting Policies
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 (AUD), which is the Group’s functional and
presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of
the transactions.
Foreign 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.
Finance income and costs
Interest income is recognised on a time proportion basis that takes
into account the effective yield on the asset. It comprises income
on funds invested and fair value gains on financial assets at fair
value through profit or loss.
Finance costs comprise interest expense on borrowings, the
ineffective portion of cash flow hedges and fair value losses on
financial assets at fair value through profit or loss.
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 amount
determined in accordance with AASB 137 Provisions, Contingent
Liabilities and Contingent Assets and the amount initially
recognised less cumulative amortisation, where appropriate.
The fair value of financial guarantees is determined as the present
value of the difference in net cash flows between the contractual
payments under the debt instrument and the payments that would
be required without the guarantee, or the estimated amount that
would be payable to a third party for assuming the obligations.
8.5. Changes in Accounting Policies
and Disclosures
8.5.1 New and amended standards and
interpretations issued but not yet effective
The Group has not early adopted any standards, interpretations or
amendments that have been issued but are not yet effective.
8.5.2 Tentative agenda decisions that if issued will
impact the Group in the current and prior period
There are no tentative agenda decisions issued at year end that are
expected to have a material impact on the Group in the current and
prior period.
8.5.3 New and amended standards and interpretations
The following accounting standards and interpretations have
been issued and are effective for the Group for the period beginning
26 June 2022.
AASB 2020-3 Amendments to AASB 137 Onerous Contracts –
Cost of Fulfilling a Contract (effective date 26 June 2022)
AASB 137 defines an Onerous Contract as a contact in which the
unavoidable costs of meeting the obligations under the contract
exceed the economic benefits expected to be received under it.
The unavoidable costs under a contract reflect the least net cost of
exiting from the contract, which is the lower of the cost of fulfilling it
and any compensation or penalties arising from failure to fulfil it.
The amendments to AASB 137 clarifies that the direct costs of
fulfilling a contract include both the incremental costs of fulfilling the
contract and an allocation of other costs directly related to fulfilling
contracts. Before recognising a separate provision for an onerous
contract, the entity recognises any impairment loss that has occurred
on assets used in fulfilling the contract.
The Group has assessed the impact of these adjustments and expects
that an opening balance sheet adjustment to increase the provision
will be recognised in the range of $5.0 to $10.0 million.
123
Notes to the Financial Statements for the year ended 25 June 2022 Directors’ Declaration
For the Year Ended 25 June 2022
1.
In the opinion of the Directors of Seven West Media Limited (the Company):
a. the consolidated financial statements and notes that are set out on pages 72 to 123 and the Remuneration Report
on pages 50 to 70 in the Directors’ Report are in accordance with the Corporations Act 2001, including:
i. giving a true and fair view of the Group’s financial position as at 25 June 2022 and of its performance for the
financial year ended on that date; and
ii. complying with Australian Accounting Standards and the Corporations Regulations 2001; and
b. there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable.
2. As at the date of this declaration, there are reasonable grounds to believe that the Company and the members of
the Extended Closed Group identified in Note 7.2 will be able to meet any obligations or liabilities to which they are
or may become subject by virtue of the Deed of Cross Guarantee, described in Note 7.2, between the Company and
those group entities pursuant to the ASIC Corporations (Wholly-owned Companies) Instrument 2016/785.
3. The Directors have been given the declarations required by section 295A of the Corporations Act 2001
from the Chief Executive Officer and the Chief Financial Officer for the financial year ended 25 June 2022.
4. The Directors draw attention to page 78 of the consolidated financial statements, which includes a statement
of compliance with International Financial Reporting Standards.
Signed in accordance with a resolution of the Directors
KM Stokes AC
Chairman
Sydney
16 August 2022
124
Financial Statements Seven West Media Limited Annual Report 2022 Independent Auditor’s Report
To the shareholders of Seven West Media Limited
Report on the audit of the Financial Report
Basis for opinion
Opinion
We have audited the Financial Report of Seven West Media
Limited (the Company).
We conducted our audit in accordance with Australian
Auditing Standards. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide
a basis for our opinion.
In our opinion, the accompanying Financial Report of the
Company is in accordance with the Corporations Act 2001,
including:
Our responsibilities under those standards are further
described in the Auditor’s responsibilities for the audit
of the Financial Report section of our report.
> Giving a true and fair view of the Group’s financial
position as at 25 June 2022 and of its financial
performance for the year ended on that date; and
> Complying with Australian Accounting Standards
and the Corporations Regulations 2001.
The Financial Report comprises:
> Consolidated statement of financial position as at
25 June 2022;
> Consolidated statement of profit or loss and other
comprehensive income, Consolidated statement of
changes in equity, and Consolidated statement of cash
flows for the year then ended;
> Notes including a summary of significant accounting
policies; and
> Directors’ Declaration.
The Group consists of the Company and the entities it
controlled at the year-end or from time to time during the
financial year.
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 fulfilled
our other ethical responsibilities in accordance with these
requirements.
Key Audit Matters
The Key Audit Matters we identified are:
> Valuation of Television Licences
> Provision for onerous contracts
> Acquisition of Prime Television (Holdings) Pty Limited
and its subsidiaries, and Seven Affiliate Sales Pty Limited
(together, ‘Prime’)
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.
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG
International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used
under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under Professional
Standards Legislation.
125
Independent Auditor’s Report
Valuation of Television Licences ($670,277k)
Refer to Note 4.1 to the Financial Report
The key audit matter
How the matter was addressed in our audit
Valuation of the Television Licences is a Key Audit Matter
due to:
Our procedures included:
> Considering the appropriateness of the Group’s
assessment of impairment and impairment reversal
indicators and the value in use method applied by the
Group to test the Television Licenses for impairment
against the requirements of the accounting standards.
> Challenging the short, medium and long-term forecasts
for television advertising market growth rates and the
Group’s share of the advertising market, particularly
considering the expected market conditions. We
compared the market share and growth rate assumptions
against historical actuals and published industry outlook
reports. This procedure was performed with assistance
from our valuation specialist.
> Challenging the discount rate against publicly available
data of a group of comparable entities. This procedure
was performed with assistance from our valuation
specialist.
> Assessing disclosures in relation to the valuation of the
television licenses by comparing these disclosures to our
understanding obtained from our testing and accounting
standards requirements.
> The size of the asset, being the largest asset of the
Group, noting there have been impairments and partial
impairment reversals in prior years; and
> The level of judgement required by us in evaluating
the assumptions determined by the Group for forecast
Television cash generating unit (“CGU”) revenues.
The level of judgement required by us in evaluating the
Group’s forecast Television CGU revenues was impacted
by the following conditions existing at 25 June 2022:
> The continued recovery from COVID-19 of television
advertising revenue markets compared to previous
impairment estimates; and
> The longer-term growth in advertising revenue for
commercial television networks continuing to be
challenged by changes in consumer viewing habits
and use of alternative viewing platforms.
The above factors create uncertainty in the key assumptions
used in the Television Licences value in use model increasing
the risk of inaccurate forecasts or a wider range of possible
outcomes for us to consider, specifically:
> Television advertising growth rates in free to air and
digital markets – short, medium and long term;
> The Group’s share of the Television advertising in
free to air and digital markets; and
> The discount rate – this is complicated in nature and
varies according to the above specific conditions.
126
Financial Statements Seven West Media Limited Annual Report 2022 Independent Auditor’s Report
Provision for Onerous Contracts ($79,358k)
Refer to Note 4.4 to the Financial Report
The key audit matter
How the matter was addressed in our audit
The Group’s policy is to routinely enter noncancellable
purchase contracts for television programs and sporting
broadcast rights. Where there are changes in market
conditions or contractual terms the Group’s policy is to
estimate the unavoidable minimum net obligation under these
contracts to determine which are onerous and, where relevant,
recognise or adjust the provision for onerous contracts.
Provision for onerous contracts is a Key Audit Matter due to:
> The level of judgement required by us in evaluating
the assumptions determined by the Group for forecast
economic benefits from each onerous contract including
future television advertising revenues; and
> The $8,351,000 reversal of the provision in the
current year.
The judgements required by us in evaluating the Group’s
estimation of the unavoidable minimum net obligations for
onerous contracts include assessing:
> The economic benefits expected to be received under the
onerous contracts including future advertising revenues
(determined with growth rate assumptions consistent
with those used in the Valuation of Television Licences
key audit matter);
> The costs of fulfilling the onerous contract; and
> The tenure and timing of the obligation where the
contract period is contingent on factors outside
of the Group’s control.
These estimation uncertainties increase the risk of inaccurate
forecasting or a wider range of possible outcomes for us
to consider which gives rise to greater audit complexity.
For significant purchase contracts for television programs
and sporting broadcast rights, our procedures included:
> Evaluating the basis for recognition of the onerous
contract provision against the Group’s accounting
policy and the accounting standards.
> Assessing the Group’s determination of economic
benefits expected to be received under each contract.
We compared the forecast benefits to historical results
on similar television programs, checking the impact of
expected market conditions and advertising revenue
outlook were consistent with the assumptions set out and
tested by us in the Valuation of Television Licences key
audit matter.
> Comparing the costs of fulfilling the obligation against
the onerous contract, historical costs on similar television
programs and sporting broadcast rights adjusted for
published expectations for cost growth.
> Checking changes to the tenure of onerous contracts,
including changes that release the Group from their non-
cancellable obligations, to the Group’s recorded reversal
of the onerous provision.
> Challenging the Group’s estimated tenure and timing
of the obligation based on the factors that influence
contractual tenure outside of the Group’s control, such
as historical series life of similar programming.
> Assessing quantitative and qualitative disclosures in
relation to the impact to the Group of the upcoming
changes to AASB 137 Provisions, Contingent Liabilities
and Contingent Assets.
127
Independent Auditor’s Report
Acquisition of Prime (Goodwill $27,398k and fair value of net identifiable assets acquired $93,893k)
Refer to Note 7.4 to the Financial Report
The key audit matter
How the matter was addressed in our audit
On 23 December 2021 the Group acquired 100% of
the issued share capital of Prime. This transaction has
been treated as a business combination, with the Group
recognising the fair value of the assets acquired and
liabilities assumed on that date.
Accounting for the purchase of Prime is a key audit matter
due to the:
> Significant value of the acquisition;
> High level of judgement required in determining:
– When control was obtained;
– Identification of acquired intangible assets, such
as reacquired program supply rights, customer
relationships and software;
– The assumptions and estimates used when
performing intangible asset valuations, which
included the use of an independent valuation
specialist engaged by the Group;
– Fair value adjustments to tangible assets
acquired and liabilities assumed; and
– Whether the acquisition accounting remains
provisional at year end. This increases the possible
range of outcomes for the auditor to consider and is
impacted by the reduced precision of audit evidence.
Our procedures included:
> Reading the share sale agreement to understand
key terms and conditions and evaluate the Group’s
assessment of when control was obtained of the
acquired business;
> Assessing the scope of work, objectivity, capability and
competence of the independent valuation specialist
engaged by the Group;
> Working with our valuation specialists to assess the
Group’s valuation of identifiable intangible assets by:
– Evaluating the Group’s assessment of identified
acquired intangible assets against accounting
standard requirements and similar business
acquisitions; and
– Challenging key assumptions in the Group’s
intangible valuation models by comparing them to
the past performance of the acquired business and
our knowledge of industry trends; and
> Assessing the adequacy of the Group’s disclosures
in respect of the acquisition against the requirements
of accounting standards and our knowledge of the
transactions.
128
Financial Statements Seven West Media Limited Annual Report 2022 Independent Auditor’s Report
Other Information
Other Information is financial and non-financial information
in Seven West Media Limited’s annual reporting which
is provided in addition to the Financial Report and the
Auditor’s Report. The Directors are responsible for the
Other Information.
Our opinion on the Financial Report does not cover the Other
Information and, accordingly, we do not express an audit
opinion or any form of assurance conclusion thereon, with
the exception of the Remuneration Report and our related
assurance opinion.
In connection with our audit of the Financial Report, our
responsibility is to read the Other Information. In doing so,
we 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.
We are required to report if we conclude that there is a
material misstatement of this Other Information, and based
on the work we have performed on the Other Information that
we obtained prior to the date of this Auditor’s Report we have
nothing to report.
Responsibilities of the Directors
for the Financial Report
The Directors are responsible for:
> Preparing the Financial Report that gives a true and fair
view in accordance with Australian Accounting Standards
and the Corporations Act 2001;
> Implementing necessary internal control to enable the
preparation of a Financial Report that gives a true and
fair view and is free from material misstatement, whether
due to fraud or error; and
> Assessing the Group and Company’s ability to continue
as a going concern and whether the use of the going
concern basis of accounting is appropriate. This includes
disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting
unless they either intend to liquidate the Group and
Company or to cease operations, or have no realistic
alternative but to do so.
129
Independent Auditor’s Report
Auditor’s responsibilities for the audit of the Financial Report
Our objective is:
> 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.
A further description of our responsibilities for the audit of the
Financial Report is located at the Auditing and Assurance
Standards Board website at: https://www.auasb.gov.au/
admin/file/content102/c3/ar1_2020.pdf. This description
forms part of our Auditor’s Report.
Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance with
Australian Auditing Standards will always detect a material
misstatement when it exists.
KPMG
Misstatements can arise from fraud or error. They 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 the Financial Report.
Duncan McLennan
Partner
Sydney
16 August 2022
Reissued Report on the Remuneration Report
Opinion
Directors’ responsibilities
In our opinion, the Reissued Remuneration Report of Seven
West Media Limited for the year ended 25 June 2022
complies with Section 300A of the Corporations Act 2001.
Emphasis of matter
We draw attention to page 50 of the Reissued Remuneration
Report which contains the Message from the Remuneration &
Nominations Committee Chairman including describing the
correction of errors in the previously issued Directors Report
including Remuneration Report for the financial year ended
25 June 2022 and that the Directors have chosen to amend
and reissue the Remuneration Report. As a consequence, this
audit report specific to the Reissued Remuneration Report
supersedes our previous opinion specifically relating to the
Report on the Remuneration Report to the shareholders of
Seven West Media Limited (dated 16 August 2022) for the
financial year ended 25 June 2022 signed and approved by
the directors on 16 August 2022. Our opinion is not modified
in respect of this matter.
The Directors of the Company are responsible for the
preparation and presentation of the Reissued Remuneration
Report in accordance with Section 300A of the Corporations
Act 2001.
Our responsibilities
We have audited the Reissued Remuneration Report attached
and marked as pages 50 to 70 for the year ended 25 June 2022.
Our responsibility is to express an opinion on the Reissued
Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
KPMG
Duncan McLennan
Partner
Sydney
26 October 2022
130
Financial Statements Seven West Media Limited Annual Report 2022
Investor
Information
Shareholder Inquiries
Tax File Number Information
Investors seeking information regarding their shareholding or
dividends or wishing to advise of a change of address should
contact the Share Registry at:
Boardroom Pty Limited
Level 12
Grosvenor Place
225 George Street
Sydney NSW 2000
Telephone: (02) 9290 9600
Facsimile: (02) 9279 0664 or
Visit the online service at boardroomlimited.com.au
Boardroom Pty Limited has an online service for investors
called InvestorServe. This enables investors to make online
changes, view balances and transaction history, as well
as obtain information about recent dividend payments
and download various forms to assist in the management
of their holding. To use this service visit the Boardroom Pty
Limited website.
Investor Relations enquiries may be directed to
swminvestorrelations@seven.com.au or visit the website at
www.sevenwestmedia.com.au
The company is obliged to record Tax File Numbers or
exemption details provided by shareholders. While it is not
compulsory for shareholders to provide a Tax File Number
or exemption details, Seven West Media Limited is obliged
to deduct tax from unfranked dividends paid to investors
resident in Australia who have not supplied such information.
Forms are available upon request from the Share Registry
or shareholders can submit their Tax File Number via the
Registry’s website.
The Chess System
Seven West Media Limited operates under CHESS –
Clearing House Electronic Subregister System – an Australian
Securities Exchange system which permits the electronic
transfer and registration of shares. Under CHESS, the
company issues a Statement of Holdings to investors, instead
of share certificates, and the statement will quote the Holder
Identification Number (HIN). The HIN should be quoted on
any correspondence investors have with the Share Registry.
The company will maintain investors’ holdings in an Issuer
Sponsored facility, which enables investors to maintain
their holding without the need to be tied to any particular
stockbroker.
131
Shareholder
Information
The shareholder information set out below was applicable at 31 July 2022.
a. Distribution of equity securities
a. Analysis of numbers of equity security holders by size of holding:
Size of holding
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
b. There were 3,979 holders of less than a marketable parcel of ordinary shares.
b. Equity security holders
The names of the twenty largest holders of equity securities are listed below:
Name
NETWORK INVESTMENT HOLDINGS PTY LTD
CITICORP NOMINEES PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
CERTANE CT PTY LTD
3RD WAVE INVESTORS PTY LTD
BNP PARIBAS NOMS PTY LTD
NATIONAL NOMINEES LIMITED
CERTANE CT PTY LTD
MR GRAHAM WALLACE RAY
SOJOURN SERVICES PTY LTD
JAMPLAT PTY LTD
BNP PARIBAS NOMINEES PTY LTD
LAUREN INVESTMENTS PTY LTD
MR JOHN ALEX RUMBLE & MRS SONJA RUMBLE
RUZ PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
SOUTHERN STEEL INVESTMENTS PTY LIMITED
MRS ELIZABETH ANNE FOGARTY & MRS CAITLYN ELIZABETH EMBLEY
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
Number of
shareholders
3,784
6,122
2,082
3,027
598
15,559
Percentage
of issued
shares
38.91%
9.89%
8.81%
4.57%
3.39%
2.89%
2.62%
2.24%
1.84%
0.68%
0.60%
0.57%
0.36%
0.31%
0.31%
0.25%
0.24%
0.22%
0.20%
0.16%
Number of
ordinary
shares held
618,711,654
157,180,968
140,056,440
72,695,129
53,973,699
46,000,000
41,638,067
35,540,342
29,295,292
10,746,162
9,483,369
9,072,749
5,696,570
5,000,000
4,893,000
4,000,000
3,824,209
3,447,705
3,200,000
2,472,051
1,256,927,406
79.05%
132
Financial Statements Seven West Media Limited Annual Report 2022 c. Substantial shareholders
Substantial shareholders in the Company are set out below:
Name
Mr Kerry Matthew Stokes AC*
Australian Capital Equity Pty Limited
Seven Group Holdings Limited
Spheria Asset Management Pty Ltd
Substantial
holding**
38.98%
38.91%
38.91%
5.62%
Number of
ordinary shares
in substantial
holding***
621,453,734
618,711,654
618,711,654
89,339,826
See Appendix 3Y for Mr Kerry Matthew Stokes AC lodged on 11 November 2021.
*
** Based on the number of ordinary shares on issue at 31 July 2022.
*** Based on the number of shares disclosed in the relevant Notice of Change of Interests of Substantial Holder.
d. Voting rights
On a show of hands, every member present in person or by proxy shall have one vote and upon a poll each share shall have
one vote.
133
Company
Information
Directors
Registered Office
Stock Exchange Listing
Australian Stock Exchange
ASX code: SWM
Legal Advisors
Herbert Smith Freehills
ANZ Tower
161 Castlereagh Street
Sydney NSW 2000
K Stokes AC – Chairman
J Warburton – Managing Director &
Chief Executive Officer
Newspaper House
50 Hasler Road
Osborne Park WA 6017
J Alexander
T Dyson
D Evans
C Garnsey OAM
M Malone
R Stokes AO
M Ziegelaar
Share Registry
Boardroom Pty Limited
Level 12
Grosvenor Place
225 George Street
Sydney NSW 2000
Company Secretary
W Coatsworth
Auditor
KPMG
Tower Three
International Towers Sydney
300 Barangaroo Avenue
Sydney NSW 2000
134
Financial Statements Seven West Media Limited Annual Report 2022
Seven West Media cares about the environment.
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ABN: 91 053 480 845
Newspaper House
50 Hasler Road
Osborne Park
Perth WA 6017
T +61 8 9482 3111
F +61 8 9482 9080
sevenwestmedia.com.au