SG Fleet Group Limited
ABN 40 167 554 574
Annual Report
2015
Contents
About SG Fleet
Chairman’s Report
Chief Executive Officer’s Report
Directors’ Report
Auditor’s Independence Declaration
Financial Report
Shareholder Information
Corporate Directory
1
6
7
12
27
28
71
73
About SG Fleet
SG Fleet Group Limited is one of Australia’s leading
specialist providers of fleet management, vehicle
leasing and salary packaging services. SG Fleet
has a presence across Australia, as well as in the
United Kingdom and New Zealand. The company
employs over 400 staff and has more than 90,000
vehicles under management. SG Fleet listed on
the Australian Securities Exchange in March 2014.
The company has a unique position in the marketplace,
built on the experience, product expertise and
commitment of its team. SG Fleet prides itself on the
strength of its relationships with blue chip corporate
and government customers. These relationships have
been built on a customer-centric approach to service
delivery and the development of bespoke but scalable
solutions to meet the needs of individual customers.
SG Fleet offers an extensive range of fleet management,
leasing and salary packaging solutions to corporate and
government customers, as well as heavy commercial
fleet management and leasing services. Salary packaging
solutions provided by the company include novated
leases and associated vehicle management services
for customers’ employees, as well as a range of other
employee benefits.
Constant innovation allows SG Fleet to provide its
customers with an industry-leading proprietary
technology platform that enables highly advanced fleet
management capabilities. The company continually
upgrades its solutions and introduces additional products
and services to its range.
1
SG Fleet Group Limited
A Product and Service Leader
SG Fleet’s industry leadership and strong business performance is built on
the company’s major competitive assets: exceptional relationships with
customers through outstanding service quality, the ability to develop our
offering through innovation, and the skills and experience of our people.
Making a real difference for our customers
Constant improvement has been a key component of our success. Customers rely
on our ability to add value on an ongoing basis, making a real difference to their
organisations now and continuously exploring opportunities for further progress
in the future. It is no coincidence that the average length of our largest customer
relationships is in excess of a decade and that we are regularly recognised by
customers for the quality of our service.
Parker Hannifin
2015
Supplier of the Year
OVER
A$10m
OF LEASE RENTAL
SAVINGS
“The business and SG Fleet reviewed fleet leasing
arrangements and looked for potential savings
by way of rehiring and/or re-extending lease
terms. This resulted in extending the leases of
455 passenger and commercial vehicles, which
has to-date realised a lease rental saving of
$1.1 million and an expected rental saving of
$3.3 million by the end of the 2018 financial year.
Fleet management has now extended this to a
further 593 commercial and passenger vehicles.
This exercise will deliver a further net savings of
$6.8 million across the whole of the life of assets.“
Manager Procurement & Property Branch
Public sector organisation (Australia)
SG Fleet’s whole‑of‑life analysis of the vehicle
category options for a customer’s 500‑vehicle fleet
identified potential savings of over NZ$1 million
over the term of the lease period.
Financial institution
New Zealand
NZ$1m
FLEET COST
SAVINGS
“Thank you for making the experience of obtaining a car through
SG Fleet such a smooth experience from start to finish. I really appreciate
your willingness to answer all the questions I had at the very start of
the process and felt like you had my best interests at heart. Everyone
has been amazed by the speed and ease with which everything has
happened and I wouldn’t hesitate to recommend SG Fleet to anybody.
I couldn’t be happier with the service and haven’t a bad word to say
about my experience, so thanks again!“
Novalease driver
United Kingdom
2
SG Fleet Group Limited
* Testimonials abbreviated.
Day-to-day
FLEET MANAGEMENT
SUPPORT
“Wright Health Group has partnered with SG Fleet
for the last two years and is in the process of
completing the transfer of the company’s entire
fleet of vehicles. On making the decision to
appoint a provider, our goals were to identify
a partner that could provide us with a simple,
competitive and cost effective solution for
our long and short-term needs, whilst also
providing additional support for the day-to-day
management of the fleet. SG Fleet ticked all the
boxes on this, and our drivers regularly comment
on the professionalism extended to them by the
SG Fleet team.”
Steve
Financial Controller,
Wright Health Group (UK)
“NO RISK”
SOLUTIONS
“The University launched its salary sacrifice
scheme as part of a wider sustainable travel
plan. We recognised that some of our 6,000
employees had no alternative to the car and
felt a car salary sacrifice scheme could help
minimise their environmental impact. The
University was looking to use a provider with
a “no risk” solution and felt a Novalease type
structure was the best fit. After researching
the market, we found only one provider that
could offer this solution – SG Fleet.“
Monica
Transport Manager,
University of Birmingham (UK)
Annual Report 2015
3
“Thanks for your assistance. The SG Fleet team have been
nothing short of brilliant. The process from beginning to
end has been so flawless and simply outstanding. I have
already recommended to a couple of other staff that they
should investigate for themselves. Thanks to all who have
contributed and for your great service.“
Novated driver
Australia
INCREASED WH&S
COMPLIANCE
“The fleet team, in conjunction
with SG Fleet, have reduced
our fleet by 14% and achieved
$4.7 million in fleet savings in the
3 years to February 2015. Along
with these savings, SG Fleet has
introduced an on-line logbook
through their innovation process,
which has increased efficiencies
as drivers no longer require a
continuous paper-based log book. Reporting
dashboards utilise SG Fleet’s driver behaviour
information to maximise WH&S compliance.“
Fleet Manager
Financial industry (Australia)
A Track Record of Innovation
Our leadership in technological innovation is creating measurable value for customers and helps
us further differentiate our offering.
State-of-the-art systems and applications are no longer an optional luxury. They are fast becoming
a prerequisite as customer needs become increasingly sophisticated. The expertise we have
in-house plays a key role in determining what solutions to develop and our product innovation
track record demonstrates our ability to respond to real demand quickly and efficiently.
Apple Watch App
SG Fleet already offers a mobile app that makes
it easy for fleet managers and drivers to accurately
record, track and manage information about
their vehicles. The easy-to-use interface provides
salary package data, a Fringe Benefits Tax planner,
a vehicle usage logbook, as well as service
provider and car locators. SG Fleet is now also
launching this app on the latest Apple Watch.
Fringe Benefits Tax Collector
In New Zealand, SG Fleet has taken the traditionally
manual, e-mail based FBT data collection process to a
new level of functionality. Drivers will soon be able to
submit vehicle usage data from their smartphone via a
secure web-based platform, ensuring greater accuracy
of data reporting and reducing time spent on FBT
administration.
Novalease Calculator
SG Fleet’s soon-to-be-launched Novalease Calculator is a highly
functional toolkit to help novated drivers in the UK choose the
right car. The Calculator makes the vehicle selection process
easier by accessing quotes specific to individual circumstances
and comparing results.
4
SG Fleet Group Limited
Next Leap Forward: The Mobility Concept
At SG Fleet, the culture of forward thinking and innovation is well entrenched.
We are always monitoring social and technological developments and the role these
play in demand changes.
The way people use transport and vehicles continues to evolve and, increasingly, we expect
an immediate, simple solution to moving from A to B. This creates opportunities for us to build
on our existing offering. Efficient fleet management, as we currently provide it, is precisely
about managing and allocating assets to optimise transport. Our technology is now opening
up the possibility to organise the transport asset into a true mobility solution.
Greater efficiency, active telematics,
total connectivity and information
access allow us to integrate the
vehicle into a much broader, shared
transport solution.
Finding the right vehicle for the
right transport requirement will
take into account fundamental
changes in the cityscape.
At SG Fleet, we believe we can play
a leading role in developing a more
efficient and therefore a more
socially responsible solution for
mobility needs.
Annual Report 2015
5
Chairman’s Report
Dear Shareholder
I have the pleasure of presenting to you the SG Fleet
Group Limited Annual Report for the year ended
30 June 2015.
applications on a variety of platforms, including
smartphones and so-called wearables, such as the
Apple Watch.
The Report is the first to span a full 12-month period
as last year’s Annual Report only covered the four-month
period from the date on which your Company started
trading on the Australian Securities Exchange until the
end of the 2014 financial year. A constant throughout
both periods has been our success in exceeding our net
profit forecasts in a muted operating environment, with
net profit after tax for the 2015 financial year up more
than 14% on the previous year. The pleasing consequence
of this has been another increase in dividends paid to
you, our shareholders, with the Board confirming a fully
franked final dividend of 6.117 cents per share, bringing
the total for the 2015 financial year to 10.842 cents
per share.
Our ability to offer a superior solution to customers
has been instrumental in achieving what has been a
record year for your Company. We intend to maintain
this competitive advantage by further enhancing our
understanding of current customer needs as well as
planning for our future position in this industry, which
continues to be supported by structural growth trends.
“Our ability to offer a superior solution to customers has
been instrumental in achieving what has been a record
year for your Company.”
In line with this, we began the roll-out of a Net Promoter
Score customer feedback mechanism during the financial
year. Through this tool, customers provide us with overall
service ratings as well as insights into the value-add of our
products and the efficiency of our processes. The response
has been very encouraging, but we are not resting on our
laurels. It is important for any company to be confident
in its offering, yet humble enough to acknowledge
opportunities for further enhancements. At SG Fleet,
we do indeed go that extra mile to continuously improve.
A significant part of this ever-present evolution is your
Company’s drive to maintain its leadership in innovation.
A common theme of the feedback we receive from
customers is that our in-house developed technology
is providing them with unparalleled real time support
and a wealth of information. Both fleet managers and
vehicle drivers can access this information via web-based
“A common theme of the feedback we receive from
customers is that our in-house developed technology
is providing them with unparalleled real time support
and a wealth of information.”
This technological edge has already created a unique
competitive position for your Company and it is our
firm intention to enhance this advantage and ensure
our long-term status as an industry leader. The way
people use transport and vehicles continues to evolve
and this creates opportunities for us to build on our
current offering in a profitable manner and be ready
to respond to new demand trends as they emerge.
In the context of this rapid development, it is important
to remember that while technology is becoming
a commodity, the capability to develop it is not. One of
the great strengths of SG Fleet – and ultimately a strong
barrier to entry for competitors – is the quality of our
people and our ability to drive progress internally.
Accordingly, talent management, workforce stability
and succession planning are indeed high priorities
for your Company.
During the past year, SG Fleet has settled into life as
a listed company without disruption. In fact, our listed
status has been beneficial in terms of our financing and
has helped us attract the best talent. With this first full
year behind us, we now aim to build on our momentum
and maintain our track record of delivering on our
objectives for customers and for shareholders.
I would like to thank the Directors of the Company’s
Board for their invaluable contribution during the year,
as well as Super Group, our majority shareholder, for
its continued support. I also take the opportunity to
thank you, our shareholders, for continuing to share
our exciting journey.
Andrew Reitzer
Chairman
6
SG Fleet Group Limited
Chief Executive Officer’s Report
Dear Shareholder
I am pleased to report on SG Fleet Group Limited’s
financial performance for the year ended 30 June 2015.
My review of this financial year will refer for comparison
to the pro forma financial figures of the preceding
year. Detailed financial data can be found in the full
annual report.
A record year
Our first full year as a listed company has been one of
marked progress on all fronts. It is particularly pleasing
to see that our momentum coming out of the 2014
financial year has been maintained, allowing us to beat
our prospectus profit forecasts by some margin.
Total revenue for the reported period was $171.4 million,
an increase of 9.5% over the previous financial year.
This stronger business activity was reflected in an increase
in expenses of 6.5%, to $112.6 million. Profit before tax
stood at $58.8 million, 15.7% higher than in the 2014
financial year.
Our net profit after tax reached $40.5 million, an increase
of 14.4% over the prior corresponding period. The
net profit result exceeded the $39.2 million prospectus
forecast by 3.3%, delivering on our undertaking at the
half year to meet or exceed that forecast.
This result translates into earnings per share of 16.7 cents,
an increase of 14.4% over the prior corresponding period.
Return on equity came in at a healthy 29.1%.
Revenue growth reflected the increase in total fleet
size as a result of further customer wins and deeper
penetration within existing customers. Vehicle deliveries
were slightly softer than forecast, primarily due to the
subdued economic environment throughout the financial
year. However, we compensated for this with stronger
margins, at 34.3% at the before tax level. Overall,
profitability has been supported by scale benefits, with the
‘Fleet per Employee’ ratio improving from 200 to 213.
Management and maintenance income grew 7.0% over
the prior year, to $64.0 million, in line with the increased
fleet size noted above.
Growth in vehicle deliveries, together with greater take-up
of accessories in our corporate tool-of-trade fleets,
supported the significant growth in additional products
and services revenue of 17.0%, to $48.8 million.
Funding commissions revenue grew by 24.2% to
$29.3 million as a result of growth in novated deliveries
over the prior corresponding period, as well as stronger
finance margins.
As anticipated, end of lease income declined, by
11.0% to $11.3 million, as residual values continued
to normalise in line with expectations. In our view, the
environment is now relatively stable.
Lower rental income (at $10.8 million, 11.5% below the
previous corresponding period) reflects the lower number
of vehicles in inertia as customers replaced them with
new orders.
The 10.8% growth in other income to $7.2 million was
driven by higher interest income on cash balances, higher
early termination income, and higher ad hoc income.
Mixed operational environment
The Company exceeded its prospectus forecasts, which
were set 20 months earlier, despite a decline in business
sentiment over most of that period. Some improvement
was seen in the final months of the 2015 financial year,
following a well-received Budget and an interest rate cut,
but the impact of recent events in Greece and concerns
about the Chinese equity market bubble may yet test this
fragile recovery.
On a positive note, the regulatory environment has
become clearer during the period. No meaningful impact
was seen from the abandonment of certain vehicle import
tariffs at the start of the calendar year.
A pattern of occasional aggressive tactics related to
corporate activity, interspersed amongst predominantly
rational competitive behaviour, was prevalent throughout
the reported period.
“The Company exceeded its prospectus forecasts,
which were set 20 months earlier, despite a decline
in business sentiment over most of that period.”
Annual Report 2015
7
Good progress was also made in our salary packaging
business, both in the corporate and government
segments. New wins in the business include a Federal
Government department and the Australian arm of a
major international professional services firm. These wins
open further growth avenues, with the latter resulting in
the signing up of the New Zealand arm of the same firm.
Novated relationships also often allow us to introduce our
tool-of-trade solutions.
United Kingdom and New Zealand
On the topic of our international operations, further
marked progress was made in both the United Kingdom
and New Zealand.
In the UK, business confidence is on the up after a
decisive election outcome and the operating environment
for our local business is improving. Interest in our
innovative salary packaging product has been strong,
particularly in the not-for-profit segment. We are now
working hard to improve driver take-up, and the growth
in the order pipeline is very encouraging. The tool-of-trade
business also saw a number of sole supply contract wins
in the corporate space. The current financial year will be
significant for the future of this business.
“Interest in our innovative salary packaging product has
been strong, particularly in the not-for-profit segment.”
In New Zealand, a similar uptick in market activity has
occurred during the period. The increased recognition
for our market-leading products has allowed us to win
some high quality contracts, beating off competition from
some of the more established players. These wins include
the management of the build and delivery of specialist
transport units, a sale and lease back in the IT sector, and
a number of fully maintained operating lease contracts
in the industrial sector.
Chief Executive Officer’s Report
Growth continues
In this environment, the Company has maintained its
strategic discipline and continued to pursue growth
through clearly defined channels. Our sales and marketing
model has been optimised to ensure we target new
opportunities with greater focus and impact. This
effort is supported by ongoing product and efficiency
enhancements in all parts of the business.
During the reported period, the opportunities pipeline
remained full and we maintained our strong conversion
rate in all areas. We were again successful in
demonstrating the merits of appointing a professional
external manager to companies that had not previously
outsourced their fleet management, utilising our
longstanding experience and cost reduction track record
as powerful evidence.
Overall, the structural trend towards outsourcing is
gathering pace as some of the larger States have started
to actively solicit input from the industry regarding
outsourcing options. At the same time, States that already
outsource are looking to increase the range of services
we provide. In one such case, an existing Government
client opted for a higher value-add funding arrangement.
We are also actively moving existing outsourcers from
unfunded to funded arrangements.
Continued above-market share win rates are evidence
of our strongly differentiated offering, which increasingly is
allowing us to take customers from competitors. No major
account losses occurred, confirming our unique industry
position and the strength of our customer relationships.
Our ability to identify, develop or source attractive
solutions to emerging customer needs is also supporting
our effort to offer additional products to these customers.
Examples of our success in this regard abound across the
business. In the energy sector, a number of customers
opted to extend their contracts and include a wider range
of products.
“We were again successful in demonstrating the merits
of appointing a professional external manager to
companies that had not previously outsourced their fleet
management, utilising our longstanding experience and
cost reduction track record as powerful evidence.”
8
SG Fleet Group Limited
Strategic discipline
Outlook
A common element across all our locations and businesses
is the constant drive to further improve our offering to
customers. This takes the form of technological innovation
of products and services, as well as improved efficiency for
the processes that support our interaction with customers.
In keeping with our objective to offer cutting edge
solutions, innovation is continuous at SG Fleet. During
the year, we further enhanced our telematics offering
and introduced our proprietary app to wearables such
as the Apple Watch. We also prepared for the launch
of a web-based FBT data collector in New Zealand and
a new version of the Novalease calculator in the UK.
These are just a few examples of the proprietary and
market leading technology we make available to fleet
managers and drivers.
The strict guideline behind our innovation, as well as
our investigation of opportunities in adjacent activity
areas, is that we must remain focused on direct business
outcomes. We are constantly mindful of the need to
develop solutions that will meet a real demand, resulting
in real and profitable revenue streams.
The same concept of remaining ‘on-strategy’ at all
times is the basis on which we investigate inorganic
growth opportunities. We adhere to a strict valuation
discipline and will not consider acquisitions that do not
fully fit into our strategic roadmap or that risk taking
us into business areas where our core expertise cannot
be deployed profitably.
“We are constantly mindful of the need to develop
solutions that will meet a real demand, resulting
in real and profitable revenue streams.”
Over this reporting period, the Company has again been
able to exceed the demanding targets set in terms of its
financial performance. It is our firm intention to preserve
that track record, as well as our growth momentum.
In the current financial year, we aim to maintain
underlying profit growth levels through a combination
of revenue gains and margin expansion. We are confident
that the combination of our exceptional customer
retention levels, increased penetration and high win rate
will allow us to grow revenue streams. In turn, margin
improvements will be supported by increased scale
benefits, greater internal efficiencies and further cost
compression. The ongoing consolidation of our systems
infrastructure will be an important driver in that regard
in the long term.
The disciplined execution of our growth strategy and
our constant focus on cost management will allow us
to achieve these objectives. Further enhancements to
our competitive differentiation, in combination with the
well-documented structural trend towards outsourcing,
will also ensure we are well-placed to be a beneficiary of
any step-change developments in terms of demand, both
in the government and corporate sectors.
I would like to take this opportunity to thank my executive
as well as the broader SG Fleet team for their efforts in
this first full year of our listed life. It has been an excellent
start in a challenging environment and our goal is to
reward the trust and support of our shareholders on
an ongoing basis by continuing to deliver attractive
and sustainable returns.
Robbie Blau
Chief Executive Officer
Annual Report 2015
9
Chief Executive Officer’s Report
Pro forma adjustments to the statutory income statement
The table below sets out the adjustment to the Statutory Results for 2015 and 2014 to primarily reflect the
acquisitions that SG Fleet Group Limited has made since 1 July 2013 as if they had occurred as at 1 July 2013 and
the full year impact of the operating and capital structure that is in place following completion of the Initial Public
Offering (’IPO’) (on 6 March 2014) as if it was in place as at 1 July 2013. In addition, certain other adjustments to
eliminate non-recurring items have been made. These adjustments are summarised below:
Statutory revenue
Interest income
Exit fees
Pro forma revenue
Statutory NPAT
RPS interest
Management fees
Listed public company costs
Interest income
Exit fees
Bonus shares and bonus payment
Transaction costs
Income tax effect
Pro forma NPAT
Consolidated
30 Jun 2015
$m
30 Jun 2014
$m
171.4
-
-
171.4
165.7
(1.1)
(8.1)
156.5
40.5
34.9*
-
-
-
-
-
-
-
-
40.5
2.5
0.6
(1.1)
(1.1)
(8.1)
4.7
0.5
2.5
35.4
* The prior year statutory NPAT of $34.9 million comprised the statutory NPAT of SG Fleet Holdings Pty Limited and
its subsidiaries for the period 1 July 2013 to 5 March 2014 of $19.3 million aggregated with the statutory NPAT of
SG Fleet Group Limited and its subsidiaries for the period 6 March 2014 to 30 June 2014 of $15.6 million.
10
SG Fleet Group Limited
Pro forma consolidated income statements: Financial year ended 30 June 2015
compared to financial year ended 30 June 2014
The pro forma consolidated income statement for the financial year ended 30 June 2015 and 30 June 2014 has
been prepared on the same basis as the pro forma consolidated financial income statement for the year ended
30 June 2015 and 30 June 2014 published in the SG Fleet Group IPO prospectus issued in February 2014.
The table below sets out the pro forma consolidated income statement for the financial years ended 30 June 2015
and 30 June 2014.
Revenue
- Management and maintenance income
- Additional products and services
- Funding commissions
- End of lease income
- Rental income
- Other income
Total revenue
Fleet management costs
Employee benefits expense
Occupancy costs
Technology costs
Other expenses
Depreciation and amortisation
Finance costs
Profit before tax
Income tax expense
NPAT
Consolidated
30 Jun 2015
$m
30 Jun 2014
$m
Change
%
Prospectus
forecast
30 Jun 2015
$m
64.0
48.8
29.3
11.3
10.8
7.2
171.4
(44.5)
(43.6)
(4.1)
(3.2)
(6.6)
(7.1)
(3.5)
58.8
(18.3)
40.5
59.8
41.7
23.6
12.7
12.2
6.5
156.5
(38.6)
(42.7)
(4.1)
(2.9)
(6.4)
(6.8)
(4.2)
50.8
(15.4)
35.4
7.0
17.0
24.2
(11.0)
(11.5)
10.8
9.5
15.3
2.1
-
10.3
3.1
4.4
(16.7)
15.7
18.8
14.4
62.6
46.7
29.8
9.7
11.9
7.8
168.5
(44.1)
(44.0)
(4.2)
(3.2)
(6.2)
(6.6)
(4.0)
56.2
(17.0)
39.2
Annual Report 2015
11
Directors’ Report
30 June 2015
The Directors present their report, together with the financial statements, on the consolidated entity (referred to
hereafter as the ‘Group’) consisting of SG Fleet Group Limited (referred to hereafter as the ‘Company’ or ‘parent
entity’) and the entities it controlled at the end of, or during, the year ended 30 June 2015.
Directors
The following persons were Directors of the Company during the whole of the financial year and up to the date
of this report, unless otherwise stated:
Andrew Reitzer (Chairman)
Robert (Robbie) Blau
Cheryl Bart AO
Graham Maloney
Peter Mountford
Kevin Wundram (alternate for Robbie Blau)
Colin Brown (alternate for Peter Mountford)
Details of the Directors are set out in the section ‘Information on Directors’ below.
Principal activities
During the financial year the principal continuing activities of the Group consisted of motor vehicle fleet
management and salary packaging services.
Dividends
Dividends paid during the financial year were as follows:
Final dividend for the period ended 30 June 2014 of
4 cents per share paid on 29 October 2014
Interim dividend for the year ended 30 June 2015 of
4.725 cents per share paid on 22 April 2015
Consolidated
Year ended
30 Jun 2015
$’000
Period ended
30 Jun 2014
$’000
9,708
11,467
21,175
–
–
–
On 17 August 2015, the Directors declared a fully franked final dividend for the year ended 30 June 2015 of
6.117 cents per ordinary shares, to be paid on 22 October 2015 to eligible shareholders on the register as at
1 October 2015. This equates to a total estimated distribution of $14,846,000 based on the number of ordinary
shares on issue as at 30 June 2015. The financial effect of dividends declared after the reporting date are not
reflected in the 30 June 2015 financial statements and will be recognised in subsequent financial reports.
Review of operations
The profit for the Group after providing for income tax amounted to $40,482,000 (30 June 2014: $15,620,000).
The current period results are for the financial year ended 30 June 2015. The comparative results are for the period
from 6 March 2014, when the Company acquired SG Fleet Holdings Pty Limited and its subsidiaries, to 30 June 2014.
The fleet size of the Group as at 30 June 2015 was 90,045 (30 June 2014: 83,837).
Refer to Chairman’s report and Chief Executive Officer’s report for further commentary on the review of operations.
Significant changes in the state of affairs
There were no significant changes in the state of affairs of the Group during the financial year.
12
SG Fleet Group Limited
Robert (Robbie) Blau
Chief Executive Officer (‘CEO’)
Qualifications:
Bachelor of Commerce (Accounting and Law),
Bachelor of Laws (Cum Laude) from the University of
the Witwatersrand, Higher Diploma in Tax Law from
Johannesburg University
Experience and expertise:
Robbie was appointed CEO of SG Fleet in July 2006 and
has over 10 years of experience in the fleet management
and leasing industry. Robbie has overall responsibility for
the strategic development of the Group and manages its
relationships with financial services partners. Previously,
Robbie was Managing Director of Nucleus Corporate
Finance in South Africa, which he founded in 1999.
During his time at Nucleus Corporate Finance, Robbie
advised South African listed entity Super Group Limited
on corporate advisory and strategic projects. He also
spent a year working with the Operations Director
of South African Breweries Limited and practised as
a commercial attorney for five years at Werksmans
Attorneys in South Africa.
Other current directorships:
None
Former directorships (last 3 years):
None
Special responsibilities:
None
Interests in shares:
6,756,425 ordinary shares in the Company
Interests in options:
3,047,619 options over ordinary ordinary shares
in the Company
Matters subsequent to the end of the
financial year
Apart from the dividend declared as discussed above,
no other matter or circumstance has arisen since 30 June
2015 that has significantly affected, or may significantly
affect the Group’s operations, the results of those
operations, or the Group’s state of affairs in future
financial years.
Likely developments and expected results
of operations
Likely developments in the operations of the Group
and the expected results of those operations are
contained in the Chairman’s report and Chief Executive
Officer’s report.
Environmental regulation
The Group is not subject to any significant
environmental regulation under Australian
Commonwealth or State law.
Information on Directors
Andrew Reitzer
Independent Non-Executive Director and Chairman
Qualifications:
Bachelor of Commerce and a Master of Business
Leadership from the University of South Africa
Experience and expertise:
Andrew has over 35 years of global experience in the
retailing and wholesaling industry. He has served as
the Chief Executive Officer (‘CEO’) of Metcash Limited
between 1998 and 2013, and continues as a consultant.
Prior to his appointment as CEO of Metcash, Andrew
held various management roles at Metro Cash & Carry
Limited and was appointed to lead the establishment of
Metro’s operations in Israel and Russia and served as the
Group Operations Director.
Other current directorships:
Non-executive Chairman of Amaysim Australia Limited
(ASX: AYS)
Former directorships (last 3 years):
Metcash Limited (ASX: MTS) (resigned 30 June 2013)
Special responsibilities:
Chairman of the Nomination and Remuneration
Committee
Interests in shares:
81,081 ordinary shares in the Company
Annual Report 2015
13
Directors’ Report
30 June 2015
Cheryl Bart AO
Independent Non-Executive Director
Qualifications:
Bachelor of Commerce and Bachelor of Laws from the
University of New South Wales, Fellow of the Australian
Institute of Company Directors
Experience and expertise:
Cheryl is a qualified lawyer and company director with
experience across industries including financial services,
utilities, energy, broadcasting, football and film. Cheryl
previously worked as a lawyer specialising in Banking
and Finance at Mallesons Stephen Jaques (now King &
Wood Mallesons). Cheryl is immediate past Chairman
of ANZ Trustees Ltd, the Environment Protection
Authority of South Australia, the South Australian Film
Corporation, Adelaide Film Festival and the Foundation
for Alcohol Research and Education (‘FARE’). She is the
31st person in the world to complete The Explorer’s
Grand Slam, and is a Patron of SportsConnect.
Other current directorships:
Australian Broadcasting Corporation (‘ABC’), Spark
Infrastructure Ltd, Audio Pixels Holdings Limited (ASX:
AKP), Football Federation of Australia (‘FFA’), Local
Organising Committee 2015 Australia Asian Cup and the
Australian Himalayan Foundation.
Former directorships (last 3 years):
South Australian Power Networks
Special responsibilities:
Member of the Audit, Risk and Compliance Committee
and member of the Nomination and Remuneration
Committee
Interests in shares:
27,027 ordinary shares in the Company
Graham Maloney
Independent Non-Executive Director
Qualifications:
Bachelor of Arts from the University of Sydney, Associate
of the Institute of Actuaries of Australia, Fellow of the
Australian Institute of Company Directors
Experience and expertise:
Graham has over 40 years of experience in financial
services, including superannuation, life insurance,
commercial banking, investment banking and
stock broking. He is the CEO of Stratagm, which
he established in 2009 to provide strategic and
financial advisory services to both businesses and
individuals. Graham’s experience includes roles as
Division Director at Macquarie Capital and as Group
Treasurer at National Australia Bank.
Other current directorships:
Chair, Connective Group Australia
Former directorships (last 3 years):
SFG Australia (ASX: SFW)
Special responsibilities:
Chairman of the Audit, Risk and Compliance Committee
Interests in shares:
27,027 ordinary shares in the Company
Peter Mountford
Non-Executive Director
Qualifications:
Bachelor of Commerce and Bachelor of Accountancy
from the University of the Witwatersrand, Chartered
Accountant, Higher Diploma in Taxation from the
University of Witwatersrand and MBA (With Distinction)
from Warwick University
Experience and expertise:
Peter is the nominee for Super Group Limited, has
over 20 years of senior management experience and
currently serves as the CEO of Super Group Limited
since 2009. Prior to becoming the CEO of Super Group,
he served as the Managing Director of Super Group’s
Logistics and Transport division and later its Supply
Chain division. Peter’s experience also includes six years
as the CEO of Imperial Holdings’ Consumer Logistics
division as Managing Director of South African Breweries
Diversified Beverages. He is currently a Director of The
Road Freight Association in South Africa.
Other current directorships:
Super Group Limited (JSE: SPG)
Former directorships (last 3 years):
None
Special responsibilities:
Member of the Audit, Risk and Compliance Committee
and member of the Nomination and Remuneration
Committee
Interests in shares:
540,540 ordinary shares in the Company
Kevin Wundram
Alternate Director for Robbie Blau and Chief Financial
Officer (‘CFO’)
Qualifications:
Bachelor of Commerce from the University of the
Witwatersrand, Honours Bachelor of Accounting
Science degree from the University of South Africa,
Chartered Accountant
14
SG Fleet Group Limited
Other current directorships:
Super Group Limited (JSE: SPG), Bluefin Investments
Limited (Mauritius)
Former directorships (last 3 years):
None
Special responsibilities:
None
Interests in shares:
108,108 ordinary shares in the Company
‘Other current directorships’ set out above are current
directorships for listed entities only and excludes
directorships of all other types of entities, unless
otherwise stated.
‘Former directorships (last 3 years)’ quoted above are
directorships held in the last 3 years for listed entities
only and excludes directorships of all other types of
entities, unless otherwise stated.
Company secretary
Sarah Anne Edwards (LLB (Hons), Grad Dip Legal
Practice) has been Legal Counsel of the Group since
April 2012 and was appointed as Company Secretary
on 1 July 2015. In addition to her duties as Company
Secretary, Sarah is responsible for providing corporate
and commercial legal advice and support as well as
managing various regulatory and compliance matters
for the Group. Sarah first practised as a lawyer at Blake
Dawson Waldron (as it was known then) before joining
the company secretariat team at NRMA Motoring &
Services. Prior to joining the Group, Sarah’s in-house
legal experience has been primarily in the construction
industry, having worked for AE&E Australia Pty Ltd and
Tenix Group.
The previous company secretary was Julianne Lyall-
Anderson (appointed on 24 June 2014 and resigned on
23 March 2015). Kevin Wundram fulfilled the role as
interim company secretary (appointed on 23 March 2015
and resigned on 1 July 2015).
Experience and expertise:
Kevin has been CFO of SG Fleet Group since July
2006 and has over 10 years of experience in the fleet
management and leasing industry. He is responsible for
the effective management of the finance, treasury and
corporate governance functions across the Group. Prior
to joining the Group, Kevin was responsible for special
projects at Super Group Limited, including the execution
of acquisitions, disposals and due diligence. Kevin was
also a member of the management committees of the
Automotive Parts, Commercial Dealerships and Supply
Chain Divisions. Prior to joining Super Group, Kevin
worked in the audit and corporate finance divisions
of KPMG South Africa for six years.
Other current directorships:
None
Former directorships (last 3 years):
None
Special responsibilities:
None
Interests in shares:
1,863,840 ordinary shares in the Company
Interests in options:
1,250,000 options over ordinary ordinary shares in
the Company
Colin Brown
Alternate Director for Peter Mountford
Qualifications:
Bachelor of Accounting Science degree from the
University of South Africa (‘UNISA’), Honours Bachelor
of Accounting Science degree from UNISA, Certificate
in the Theory of Accounting from UNISA, Chartered
Accountant (South Africa), Master in Business Leadership
degree from the UNISA School of Business Leadership
Experience and expertise:
Colin provided support services to Super Group Limited’s
treasury activities in Johannesburg from June 2009 to
February 2010, and was appointed to the Super Group
Limited’s board as CFO in February 2010. Prior to that,
Colin was CFO and a member of the board of Celcom
Group Limited, a business in the mobile phone industry
and previously listed on the Alternative Exchange (‘AltX’)
of the Johannesburg Stock Exchange (‘JSE’). Colin has
also held the Financial Director position at Electronic
Data Systems (‘EDS’) Africa Limited and Fujitsu Services
South Africa, both multi-national companies in the
information technology services industry.
Annual Report 2015
15
Directors’ Report
30 June 2015
Meetings of Directors
The number of meetings of the Company’s Board of Directors (‘the Board’) and of each Board committee held
during the year ended 30 June 2015, and the number of meetings attended by each Director were:
Andrew Reitzer
Robbie Blau
Cheryl Bart AO
Graham Maloney
Peter Mountford
Board of Directors
Audit, Risk and
Compliance Committee
Nomination and
Remuneration Committee
Attended
Held
Attended
Held
Attended
Held
9
9
8
8
9
9
9
9
9
9
–
–
4
4
4
–
–
4
4
4
4
–
4
–
4
4
–
4
–
4
Held: represents the number of meetings held during the time the Director held office or was a member of the
relevant committee.
Kevin Wundram and Colin Brown did not attend any meetings in their capacity as an Alternate Director during the
financial year.
Remuneration report (audited)
The remuneration report, which has been audited,
details the Key Management Personnel (‘KMP’)
remuneration arrangements for the Group, in
accordance with the requirements of the Corporations
Act 2001 and its Regulations.
KMP are those persons having authority and
responsibility for planning, directing and controlling
the activities of the Group, directly or indirectly,
including all directors.
The remuneration report is set out under the following
main headings:
• principles used to determine the nature and
amount of remuneration
• details of remuneration
• service agreements
• share-based compensation
• additional information
• additional disclosures relating to key
management personnel
Principles used to determine the nature and
amount of remuneration
The objective of the Group’s executive reward
framework is to ensure reward for performance is
competitive and appropriate for the results delivered.
The framework aligns executive reward with the
achievement of strategic objectives and the creation of
value for shareholders, and conforms to market best
practice for delivery of reward. The Board ensures that
executive reward satisfies the following key criteria for
good reward governance practices:
• competitiveness and reasonableness;
• acceptability to shareholders;
• performance linkage / alignment of executive
compensation; and
• transparency.
The main role of the Nomination and Remuneration
Committee (‘NRC’) is to assist the Board in fulfilling its
corporate governance responsibilities and to review and
make recommendations in relation to the remuneration
arrangements for its Directors and executives. The NRC
comprises two independent Non-Executive Directors
and one Non-Executive Director and meets regularly
throughout the financial year. The CEO and CFO attend
certain committee meetings by invitation, where
management input is required. The CEO and CFO are
not present during any discussions related to their own
remuneration arrangements.
16
SG Fleet Group Limited
The performance of the Group depends on the quality
of its Directors and executives. The remuneration
philosophy is to attract, motivate and retain high
performing, quality executives.
The remuneration framework has been structured
to be market competitive and complementary to the
reward strategy of the Group.
Alignment to shareholders’ interests:
• has economic profit as a core component of
plan design;
• focuses on sustained growth in shareholder wealth,
consisting of dividends and growth in share price, and
delivering constant or increasing return on assets as
well as focusing the executive on key non-financial
drivers of value; and
• attracts and retains high calibre executives.
Alignment to executives’ interests:
• rewards capability and experience;
• reflects competitive reward for contribution to growth
in shareholder wealth; and
• provides a clear structure for earning rewards.
In accordance with best practice corporate governance,
the structure of Non-Executive Directors and executive
remunerations are separate.
Non-Executive Directors’ remuneration
Fees and payments to Non-Executive Directors reflect
the demands that are made on, and the responsibilities
of, these Directors. Non-Executive Directors’ fees and
payments are reviewed annually by the NRC. The NRC
may, from time to time, receive advice from independent
remuneration consultants to ensure Non-Executive
Directors’ fees and payments are appropriate and in line
with the market. The Chairman’s fees are determined
independently to the fees of other Non-Executive
Directors based on comparative roles in the external
market. The Chairman is not present at any discussions
relating to determination of his own remuneration.
Non-Executive Directors do not receive retirement
benefits, share options or other cash incentives.
The remuneration of Non-Executive Directors consists
of Directors’ fees and committee fees. The Chairman of
the Board attends all committee meetings but does not
receive committee fees in respect of his role as Chairman
or member of any committee.
Non-Executive Director fees (Directors’ fees and
committee fees) (inclusive of superannuation) proposed
for the year ending 30 June 2016, amounting to
$505,000 is summarised as follows:
Name – Position
FY 2016 Fees
Andrew Reitzer
– Independent Non-Executive Chairman
Cheryl Bart AO
– Independent Non-Executive Director
Graham Maloney
– Independent Non-Executive Director
Peter Mountford
– Non-Executive Director
$180,000
$107,500
$110,000
$107,500
ASX listing rules require the aggregate Non-Executive
Directors remuneration be determined periodically by
a general meeting. The most recent determination was
at the Annual General Meeting held on 12 February
2014, where the shareholders approved the aggregate
remuneration be fixed at a maximum of $1,000,000
per annum.
Executive remuneration
The Group aims to reward executives with a level
and mix of remuneration based on their position
and responsibility, which has both fixed and variable
components.
The executive remuneration and reward framework
has four components:
• base salary and non-monetary benefits;
• short-term performance incentives;
• share-based payments; and
• other remuneration, such as superannuation and
long service leave.
The combination of these comprises the executive’s
total remuneration.
Total Fixed Remuneration (‘TFR’) consisting of base
salary, annual leave, superannuation and non-monetary
benefits, is reviewed annually by the NRC, based
on individual and business unit performance, the
overall performance of the Group and comparable
market remunerations.
Executives may receive their fixed remuneration in the
form of cash or other fringe benefits (for example motor
vehicle benefits) where it does not create any additional
costs to the Group and provides additional value to
the executive.
Annual Report 2015
17
Directors’ Report
30 June 2015
The short-term incentives (‘STI’) program is designed to
align the targets of the business units with the targets of
those executives responsible for meeting those targets.
STI payments are granted to executives based on specific
annual targets. A performance modifier applies in
relation to award of the STI. For an executive to receive
payment under the STI program, their performance
has to be regarded as entirely satisfactory. Where an
executive is regarded as below competent, the award
under the STI program will be adjusted by the NRC.
Long-term incentives (‘LTI’) are set periodically for KMP
(‘Participants’) in order to align remuneration with the
creation of shareholder value over the long term. LTI
include long service leave and share-based payments.
LTI to Participants are made under the Equity Incentive
Plan (‘EIP’) and are currently delivered in the form of
share options. The number of options granted is based
on a fixed percentage of the relevant Participant’s TFR
and is issued to the Participant at no cost. Options granted
to KMP usually vest over three years (the ‘Performance
Period’), subject to the satisfaction of performance
conditions. For the 2014 LTI offer, the Performance
period was from the Group’s listing and concludes on 30
June 2017, a period of 39 months.
The performance conditions for the LTI options are
currently based on the compound annual growth rate
(‘CAGR’) of the Group’s earnings per share (‘EPS’). EPS
was selected as the performance condition for the LTI
since it is a measure of economic profit and is a key
driver of the share price which is a key component in
delivering sustained growth in shareholder wealth.
The performance period and applicable performance
conditions for any future LTI opportunities will be
determined by the Board and specified in the relevant
offer document.
The percentage of options that vest and become
exercisable, if any, is determined by reference to the
vesting schedule, summarised as follows:
CAGR of EPS over the Performance Period
% of options that become exercisable
Less than 5%
5% (Threshold performance)
Between 5% and 15%
Nil
30%
Straight-line pro-rata vesting between 30% and 100%
15% or above (Stretch performance)
100%
If the Participant ceases employment for cause, the
unvested options automatically lapse unless the Board
determines otherwise. In other circumstances, the
options will remain on foot with a broad discretion for
the Board to vest or lapse some or all of the options, the
latter of which the Board will ordinarily exercise in the
case of resignation.
Where there may be a change of control event, the
Board has the discretion to accelerate vesting of
some or all of the options and the Board will notify
the Participant of the date on which any vested but
unexercised options will expire. Where only some of the
options are vested on a change of control event, the
remainder of the options will immediately lapse.
The EIP also provides flexibility for the Group to grant,
subject to the terms of individual offers, performance
rights and restricted shares.
Any options that remain unvested at the end of
the Performance Period will lapse immediately.
The Participant must exercise any vested options within
12 months of vesting. After 12 months, any unexercised
options will lapse. The Participant is entitled to receive
one share for each option that vests and is exercised.
The Board may make an equivalent cash payment in lieu
of providing shares to the participant. Any cash payment
is at the Group’s discretion only.
The options do not carry dividends or voting rights prior
to vesting and exercise. Participants must not sell, transfer,
encumber, hedge or otherwise deal with the options.
The EIP provides the Board with broad ‘clawback’
powers if, amongst other things, the Participant has
acted fraudulently or dishonestly, engaged in gross
misconduct or has acted in a manner that has brought
the Group into disrepute, or there is a material financial
misstatement, or the Group is required or entitled under
law or company policy to reclaim remuneration from
the Participant, or the Participant’s entitlements vest as
a result of fraud, dishonesty or breach of obligations of
any other person and the Board is of the opinion that
the incentives would not have otherwise vested.
18
SG Fleet Group Limited
Group performance and link to remuneration
The financial performance measure driving STI payment
outcomes for KMP for the year ended 30 June 2015 and
future years is determined on a straight-line basis, based
on the Group achieving EPS growth of between 5.0%
and 15.0% over the previous financial year. No award
is made if the Group’s EPS growth is less than 5.0%
over the previous financial year. The proportion of the
maximum STI awarded to the KMP is at the discretion
of the Board.
The performance measure that drives LTI vesting is the
CAGR of the Group’s EPS over the relevant performance
period. The Group’s EPS for the year ended 30 June
2015 was 16.68 cents per share.
Voting and comments made at the Company’s 2014
Annual General Meeting (‘AGM’)
At the 2014 AGM, 99.9% of the votes received
supported the adoption of the remuneration report for
the period ended 30 June 2014. The Company did not
receive any specific feedback at the AGM regarding its
remuneration practices.
Details of remuneration
Amounts of remuneration
Details of the remuneration of the KMP of the Group
are set out in the following tables.
The KMP of the Group consisted of the Directors of
SG Fleet Group Limited and the following persons:
• Andy Mulcaster – Managing Director, Australia
• David Fernandes – Managing Director, United Kingdom
• Geoff Tipene – Managing Director, New Zealand
• Annie Margossian-Kenny – General Manager,
Business Quality (maternity leave from 31 October
2014 to end of financial year)
Short-term benefits
Post-
employment
benefits
Long-
term
benefits
Share-
based
payments
Cash salary
and fees
$
Bonus
$
Non-
monetary
$
Super-
annuation
$
Employee
benefits
$
Equity-
settled
$
Total
$
150,685
84,475
95,000
92,500
–
–
–
–
621,217
345,563
331,217
151,184
359,600
123,113
–
–
–
–
–
–
–
14,315
8,025
–
–
–
–
–
–
–
–
–
–
165,000
92,500
95,000
92,500
18,783
10,101
114,014 1,109,678
18,783
5,299
46,764
553,247
16,348
5,703
34,115
538,879
281,224
97,117
17,908
13,182
17,037
25,330
451,798
186,862
67,006
23,807
7,669
–
14,055
299,399
Year ended 30 Jun 2015
Non-Executive Directors:
Andrew Reitzer (Chairman)
Cheryl Bart AO
Graham Maloney
Peter Mountford
Executive Directors:
Robbie Blau (CEO)
Kevin Wundram
(CFO and Alternate Director)
Other Key Management Personnel:
Andy Mulcaster
David Fernandes*
Geoff Tipene*
Annie Margossian-Kenny
85,888
30,916
–
11,097
1,426
20,176
149,503
2,288,668
814,899
41,715
108,202
39,566
254,454 3,547,504
* Total remuneration in local currency paid to David Fernandes and Geoff Tipene was GBP 239,263 and
NZD 321,682 respectively.
Colin Brown (Alternate Director) received no remuneration during the year ended 30 June 2015.
Annual Report 2015
19
Directors’ Report
30 June 2015
Year ended 30 Jun 2014
Non-Executive Directors:
Andrew Reitzer (Chairman)
Cheryl Bart AO
Graham Maloney
Peter Mountford
Colin Brown (Alternate Director)
Executive Directors:
Robbie Blau (CEO)
Kevin Wundram
(CFO and Alternate Director)
Other Key Management Personnel:
Andy Mulcaster
David Fernandes
Geoff Tipene
Annie Margossian-Kenny
Short-term benefits
Post-
employment
benefits
Long-
term
benefits
Share-
based
payments
Cash salary
and fees
$
Bonus
$
Non-
monetary
$
Super-
annuation
$
Employee
benefits
$
Equity-
settled
$
Total
$
50,329
28,215
31,667
30,833
–
–
–
–
–
–
205,745
432,000
110,013
192,500
122,863
158,802
107,900
125,812
57,183
127,329
86,044
112,702
–
–
–
–
–
–
–
–
5,734
8,252
–
4,671
2,619
–
–
–
–
–
–
–
–
–
55,000
30,834
31,667
– 1,000,000 1,030,833
–
200,000
200,000
1,475
39,491
59,077
737,788
761
10,596
24,230
338,100
756
522
2,093
1,688
1,879
17,677
301,977
93
13,125
253,186
–
103,483
298,340
1,334
10,454
212,222
830,792 1,149,145
13,986
14,585
53,393 1,428,046 3,489,947
Remuneration above is from 6 March 2014, when SG Fleet Holdings Pty Limited and its subsidiaries were acquired,
to 30 June 2014.
In 2014 the Non-Executive Directors were also paid the following amounts for services rendered prior to the IPO:
Name
Andrew Reitzer
Cheryl Bart AO
Graham Maloney
Peter Mountford
Amount
Fees $18,879 plus superannuation $1,746
Fees $10,584 plus superannuation $979
Fees $11,875 plus superannuation $nil
Fees $11,562 plus superannuation $nil
20
SG Fleet Group Limited
Non-Executive Directors’ salaries are 100% fixed. The fixed proportion and the proportion of remuneration linked
to performance of Executive Directors and KMP are as follows:
Name
Executive Directors:
Robbie Blau
Kevin Wundram
Other Key Management Personnel:
Andy Mulcaster
David Fernandes
Geoff Tipene
Annie Margossian-Kenny
Fixed remuneration
At risk – STI
At risk – LTI
Year ended
30 Jun 2015
Period ended
30 Jun 2014
Year ended
30 Jun 2015
Period ended
30 Jun 2014
Year ended
30 Jun 2015
Period ended
30 Jun 2014
59%
65%
71%
73%
73%
66%
33%
36%
41%
45%
55%
42%
31%
27%
23%
21%
22%
21%
59%
57%
53%
50%
43%
53%
10%
8%
6%
6%
5%
13%
8%
7%
6%
5%
2%
5%
The increase in the percentage of fixed remuneration for the year ended 30 June 2015 compared to period ended
30 June 2014, is due to the fact that the calculations for the period ended 30 June 2014 represents a full year’s
short term incentive divided by 4 months’ worth of fixed remuneration.
Service agreements
Remuneration and other terms of employment for KMP
are formalised in service agreements. Details of these
agreements are as follows:
Robbie Blau – CEO
• Agreement term: Ongoing from 1 July 2006
• TFR with effect from (‘wef’) 1 July 2015: $680,000
per annum, which includes base salary, statutory
superannuation contributions and any salary sacrifice
arrangements
• STI: award of between 22.5% and 75% of TFR, on a
straight-line basis based on EPS growth of between
5% and 15% over the previous financial year. The STI
is subject to a 12 month payment deferral of 25% for
FY 2015 and thereafter 50%
• The STI earned for 2015 amounted to $460,750.
The payment of 25% of the 2015 STI, amounting to
$115,187 has been deferred until 30 June 2016
• LTI Opportunity: 120% of TFR
• Termination arrangements:
for cause: immediate termination
for poor performance: 4 weeks’ notice by the
Company after procedural fairness has been afforded
redundancy: 4 weeks’ notice by the Company,
1 year’s TFR
material change: 4 weeks’ notice by the executive,
1 year’s TFR
without cause: 4 weeks’ notice by the Company,
1 year’s TFR
resignation: 3 months’ notice by the executive
illness/mental disability: 26 weeks’ base salary
Kevin Wundram – CFO
• Agreement term: Ongoing from 1 June 2006
• TFR wef 1 July 2015: $360,000 per annum, which
includes base salary, statutory superannuation
contributions and any salary sacrifice arrangements
• STI: award of between 18% and 60% of TFR, on a
straight-line basis based on EPS growth of between
5% and 15% over the previous financial year. The STI
is subject to a 12 month payment deferral of 25% for
FY 2015 and thereafter 50%
• The STI earned for 2015 amounted to $201,578.
The payment of 25% of the 2015 STI, amounting to
$50,394 has been deferred until 30 June 2016
• LTI Opportunity: 90% of TFR
• Termination arrangements:
for cause: immediate termination
for poor performance: 4 weeks’ notice by the
Company after procedural fairness has been afforded
redundancy: 4 weeks’ notice by the Company,
48 weeks’ TFR
material change: 4 weeks’ notice by the executive,
48 weeks’ TFR
without cause: 4 weeks’ notice by the Company,
48 weeks’ TFR
resignation: 3 months’ notice by the executive
illness/mental disability: 26 weeks’ base salary
Annual Report 2015
21
Directors’ Report
30 June 2015
Andy Mulcaster – Managing Director, Australia
• Agreement term: Ongoing from 1 August 2006
• TFR wef 1 July 2015: $383,870 per annum, which
includes base salary, statutory superannuation
contributions and any salary sacrifice arrangements
• STI: award of between 15% and 50% of TFR, on a
straight-line basis based on EPS growth of between
5% and 15% over the previous financial year. The STI
is subject to a 12 month payment deferral of 25% for
FY 2015 and thereafter 50%
• The STI earned for 2015 amounted to $164,150.
The payment of 25% of the 2015 STI, amounting to
$41,037 has been deferred until 30 June 2016
• LTI Opportunity: 60% of TFR
• Termination arrangements:
for cause: immediate termination
for poor performance: 4 weeks’ notice by the
Company after procedural fairness has been afforded
redundancy: 4 weeks’ notice by the Company,
48 weeks’ TFR
material change: 4 weeks’ notice by the executive,
48 weeks’ TFR
without cause: 4 weeks’ notice by the Company,
48 weeks’ TFR
resignation: 3 months’ notice by the executive
illness/mental disability: 26 weeks’ base salary
Geoff Tipene – Managing Director, New Zealand
• Agreement term: Ongoing from 1 February 2011
• TFR wef 1 July 2015: NZD 211,150 per annum,
which includes base salary, statutory superannuation
contributions and any salary sacrifice arrangements
• STI: award of between 15% and 50% of TFR, on a
straight-line basis based on EPS growth of between
5% and 15% over the previous financial year. The STI
is subject to a 12 month payment deferral of 25% for
FY 2015 and thereafter
• 50%. Kiwi Saver of 3% is payable on this STI.
• The STI earned for 2015 amounted to NZD 95,990.
The payment of 25% of the 2015 STI, amounting to
NZD 23,998 has been deferred until 30 June 2016
• LTI Opportunity: 60% of TFR
• Termination arrangements:
for cause: immediate termination
for poor performance: 4 weeks’ notice by the
Company after procedural fairness has been afforded
redundancy notice: 4 weeks’ notice by the Company
redundancy severance <1 year Nil; 1-2 years 5 weeks;
2-3 years 8.75 weeks; 3-4 years 12.5 weeks,
4-5 years 15 weeks; 5-6 years 17.5 weeks and
>6 years 20 weeks
without cause: 4 months’ notice by the Company
resignation: 3 months’ notice by the executive
David Fernandes – Managing Director,
United Kingdom
• Agreement term: Ongoing from 9 October 2006
• TFR wef 1 July 2015: £159,583 per annum, which
includes base salary, statutory superannuation
contributions and any salary sacrifice arrangements
• STI: award of between 15% and 50% of TFR, on a
straight-line basis based on EPS growth of between
5% and 15% over the previous financial year. The STI
is subject to a 12 month payment deferral of 25% for
FY 2015 and thereafter 50%
Annie Margossian-Kenny – General Manager,
Business Quality
• Agreement term: Ongoing from 5 February 2007
• TFR wef 1 July 2015: $265,787 per annum, which
includes base salary, statutory superannuation
contributions and any salary sacrifice arrangements
• STI: award of between 15% and 50% of TFR, on a
straight-line basis based on EPS growth of between
5% and 15% over the previous financial year. The STI
is subject to a 12 month payment deferral of 25% for
FY 2015 and thereafter 50%.
• The STI earned for 2015 amounted to £68,575. The
payment of 25% of the 2015 STI, amounting to
£17,144 has been deferred until 30 June 2016
• The STI earned for 2015 amounted to $41,222.
The payment of 25% of the 2015 STI, amounting to
$10,306 has been deferred until 30 June 2016
• LTI Opportunity: 60% of TFR
• Termination arrangements:
• LTI Opportunity: 50% of TFR
• Termination arrangements:
for cause: immediate termination
for poor performance: 4 weeks’ notice by the
Company after procedural fairness has been afforded
redundancy: 4 weeks’ notice by the Company,
48 weeks’ TFR
material change: 4 weeks’ notice by the executive,
48 weeks’ TFR
without cause: 4 weeks’ notice by the Company,
48 weeks’ TFR
resignation: 3 months’ notice by the executive
illness/mental disability: 26 weeks’ base salary
for cause: immediate termination
for poor performance: 4 weeks’ notice by the
Company after procedural fairness has been afforded
redundancy: 4 weeks’ notice by the Company,
48 weeks’ TFR
material change: 4 weeks’ notice by the executive,
48 weeks’ TFR
without cause: 4 weeks’ notice by the Company,
48 week’s TFR
resignation: 3 months’ notice by the executive
illness/mental disability: 26 weeks’ base salary
22
SG Fleet Group Limited
Share-based compensation
Share and cash offers
There were no shares issued to Directors and other key management personnel as part of compensation during the
year ended 30 June 2015.
Options
The terms and conditions of each grant of options over ordinary shares affecting remuneration of Directors and
other KMP in this financial year or future reporting years are as follows:
Grant date
4 March 2014
Vesting date and
exercisable date
Expiry date
Exercise price
Fair value
per option
at grant date
30 June 2017
30 June 2018
$1.85
$0.252
Options granted carry no dividend or voting rights and can be exercised only once the vesting conditions have been
met until their expiry date.
There were no options over ordinary shares granted to or vested by Directors and other KMP as part of
compensation during the year ended 30 June 2015.
Additional information
The earnings of the Group for the two years to 30 June 2015 are summarised below:
Revenue
Profit after income tax
Dividends paid
2015
$’000
171,377
40,482
21,175
The factors that are considered to affect total shareholders return (‘TSR’) are summarised below:
Share price at financial year end ($)
Basic earnings per share (cents per share)
Share price at IPO was $1.85 per share.
2015
2.47
16.68
2014
$’000
64,083
15,620
–
2014
1.80
9.13
Additional disclosures relating to key management personnel
In accordance with Class Order 14/632, issued by the Australian Securities and Investments Commission, relating
to ‘Key management personnel equity instrument disclosures’, the following disclosures relate only to equity
instruments in the Company or its subsidiaries.
Annual Report 2015
23
Directors’ Report
30 June 2015
Shareholding
The number of shares in the Company held during the financial year by each Director and other members of key
management personnel of the Group, including their personally related parties, is set out below:
Ordinary shares
Andrew Reitzer
Robbie Blau
Cheryl Bart AO
Graham Maloney
Peter Mountford
Kevin Wundram
Colin Brown
Andy Mulcaster
David Fernandes
Geoff Tipene
Annie Margossian-Kenny
Balance at
the start of
the year
Received
as part of
remuneration
Additions
Disposals/
other
81,081
6,756,425
27,027
27,027
540,540
1,863,840
108,108
1,630,860
1,630,860
52,000
1,164,900
13,882,668
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Balance at
the end of
the year
81,081
6,756,425
27,027
27,027
540,540
1,863,840
108,108
1,630,860
1,630,860
52,000
1,164,900
13,882,668
Option holding
The number of options over ordinary shares in the Company held during the financial year by each Director and
other members of key management personnel of the Group, including their personally related parties, is set
out below:
Options over ordinary shares
Robbie Blau
Kevin Wundram
Andy Mulcaster
David Fernandes
Geoff Tipene
Annie Margossian-Kenny
Balance at
the start of
the year
3,047,619
1,250,000
911,890
677,063
375,695
539,305
6,801,572
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
3,047,619
1,250,000
911,890
677,063
375,695
539,305
6,801,572
No options were vested or forfeited during the years ending 30 June 2015 and 30 June 2014.
24
SG Fleet Group Limited
Use of remuneration consultants
During the 30 June 2014 financial period, the NRC engaged Egan Associates (‘Remuneration Consultant’) to
provide recommendations on the level of remuneration for the Group’s KMP’s for the June 2015 financial year.
The Remuneration Consultant was paid $58,905 for these services. In determining the level of remuneration for
the Group’s KMP’s for the June 2016 financial period the Group conducted a remuneration benchmarking exercise
internally and did not engage the services of a Remuneration Consultant.
This concludes the remuneration report, which has been audited.
Shares under option
Unissued ordinary shares of SG Fleet Group Limited under option at the date of this report are as follows:
Grant date
4 March 2014
Expiry date
30 June 2018
Exercise
price
Number
under option
$1.85
8,086,046
Shares issued on the exercise of options
There were no ordinary shares of SG Fleet Group Limited
issued on the exercise of options during the year ended
30 June 2015 and up to the date of this report.
Indemnity and insurance of officers
The Company has indemnified the Directors, executives
and employees of the Company for costs incurred, in
their capacity as a director, executive or employee, for
which they may be held personally liable, except where
there is a lack of good faith.
The Company’s subsidiary, SG Fleet Australia Pty Limited
on behalf of the Company paid a premium in respect of
a contract to insure the Directors and executives of the
Company and of any related bodies corporates defined
in the insurance policy, against a liability to the extent
permitted by the Corporations Act 2001.
Indemnity and insurance of auditor
The Company has not, during or since the end of the
financial year, indemnified or agreed to indemnify the
auditor of the Company or any related entity against a
liability incurred by the auditor. The Company has not
paid a premium in respect of a contract to insure the
auditor of the Company or any related entity.
Proceedings on behalf of the Company
No person has applied to the Court under section
237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Company, or to intervene
in any proceedings to which the Company is a party for
the purpose of taking responsibility on behalf of the
Company for all or part of those proceedings.
Non-audit services
Details of the amounts paid or payable to the auditor
for non-audit services provided during the financial year
by the auditor are outlined in note 30 to the financial
statements.
The Directors are satisfied that the provision of non-
audit services during the financial year, by the auditor
(or by another person or firm on the auditor’s behalf), is
compatible with the general standard of independence
for auditors imposed by the Corporations Act 2001.
The Directors are of the opinion that the services as
disclosed in note 30 to the financial statements do
not compromise the external auditor’s independence
requirements of the Corporations Act 2001 for the
following reasons:
• all non-audit services have been reviewed and
approved to ensure that they do not impact the
integrity and objectivity of the auditor; and
• none of the services undermine the general principles
relating to auditor independence as set out in APES
110 Code of Ethics for Professional Accountants issued
by the Accounting Professional and Ethical Standards
Board, including reviewing or auditing the auditor’s
own work, acting in a management or decision-
making capacity for the Company, acting as advocate
for the Company or jointly sharing economic risks
and rewards.
Annual Report 2015
25
Directors’ Report
30 June 2015
Rounding of amounts
The Company is of a kind referred to in Class Order
98/100, issued by the Australian Securities and
Investments Commission, relating to ‘rounding-
off’. Amounts in this report have been rounded off
in accordance with that Class Order to the nearest
thousand dollars, or in certain cases, the nearest dollar.
Auditor’s independence declaration
A copy of the auditor’s independence declaration as
required under section 307C of the Corporations Act
2001 immediately follows this Directors’ report.
Auditor
KPMG were initially appointed auditors by the Directors
until the first AGM of the Company. At the 2014 AGM
the shareholders approved the reappointment of KPMG
as auditors, who continue in office in accordance with
section 327 of the Corporations Act 2001.
There are no officers of the Company who are former
audit partners of KPMG.
This report is made in accordance with a resolution
of Directors, pursuant to section 298(2)(a) of the
Corporations Act 2001.
On behalf of the Directors
Andrew Reitzer
Chairman
Robbie Blau
Chief Executive Officer
17 August 2015
Sydney
26
SG Fleet Group Limited
ABCD
ABCD
Auditor’s Independence Declaration
Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001
Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001
To: the directors of SG Fleet Group Limited
To: the directors of SG Fleet Group Limited
I declare that, to the best of my knowledge and belief, in relation to the audit for the financial
I declare that, to the best of my knowledge and belief, in relation to the audit for the financial
year ended 30 June 2015 there have been:
year ended 30 June 2015 there have been:
(i)
(i)
no contraventions of the auditor independence requirements as set out in the Corporations
no contraventions of the auditor independence requirements as set out in the Corporations
Act 2001 in relation to the audit; and
Act 2001 in relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the audit.
no contraventions of any applicable code of professional conduct in relation to the audit.
(ii)
(ii)
KPMG
KPMG
Peter Russell
Peter Russell
Partner
Partner
Sydney
Sydney
17 August 2015
17 August 2015
21
21
KPMG, an Australian partnership and a member firm
of the KPMG network of independent member firms
KPMG, an Australian partnership and a member firm
affiliated with KPMG International Cooperative
of the KPMG network of independent member firms
(“KPMG International”), a Swiss entity.
affiliated with KPMG International Cooperative
(“KPMG International”), a Swiss entity.
Liability limited by a scheme
approved under Professional
Liability limited by a scheme
Standards Legislation.
approved under Professional
Standards Legislation.
Annual Report 2015
27
Financial Report
30 June 2015
Contents
Statement of Profit or Loss and Other Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Shareholder Information
Corporate Directory
29
30
31
32
33
68
69
71
73
28
SG Fleet Group Limited
Statement of Profit or Loss and Other Comprehensive Income
For the year ended 30 June 2015
Revenue
Expenses
Fleet management costs
Employee benefits expense
Occupancy costs
Depreciation, amortisation and impairment
Technology costs
Other expenses
Finance costs
Profit before income tax expense
Income tax expense
Consolidated
Year ended
30 Jun 2015
$’000
Period ended
30 Jun 2014
$’000
171,377
64,083
(44,471)
(43,603)
(4,056)
(7,155)
(3,243)
(6,565)
(3,518)
58,766
(18,284)
(13,971)
(18,737)
(1,360)
(1,757)
(899)
(2,542)
(1,088)
23,729
(8,109)
Note
5
6
6
7
Profit after income tax expense for the year attributable to
the owners of SG Fleet Group Limited
25
40,482
15,620
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Foreign currency translation difference for foreign operations
Effective portion of changes in fair value of cash flow hedges
Other comprehensive income for the year, net of tax
Total comprehensive income for the year attributable to the owners
of SG Fleet Group Limited
Basic earnings per share
Diluted earnings per share
40
40
729
(7)
722
(336)
–
(336)
41,204
15,284
Cents
16.68
16.67
Cents
9.13
8.83
The above statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes
Annual Report 2015
29
Statement of Financial Position
As at 30 June 2015
Assets
Cash and cash equivalents
Finance, trade and other receivables
Inventories
Leased motor vehicle assets
Deferred tax
Property, plant and equipment
Intangibles
Total assets
Liabilities
Trade and other payables
Derivative financial instruments
Income tax
Employee benefits provision
Residual risk provision
Borrowings
Vehicle maintenance funds
Deferred income
Total liabilities
Net assets
Equity
Issued capital
Reserves
Retained profits
Total equity
Consolidated
Note
2015
$’000
2014
$’000
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
89,143
40,072
4,921
17,664
14,483
1,003
142,692
309,978
57,906
41,741
4,643
15,688
15,032
1,199
141,365
277,574
46,933
43,981
7
8,982
4,943
12,368
43,868
17,948
25,547
160,596
149,382
232,768
(118,313)
34,927
149,382
–
2,460
4,588
15,949
43,516
14,947
23,117
148,558
129,016
232,768
(119,372)
15,620
129,016
The above statement of financial position should be read in conjunction with the accompanying notes
30
SG Fleet Group Limited
Contributions of equity, net of transaction costs (note 23)
232,768
Statement of Changes in Equity
For the year ended 30 June 2015
Consolidated
Balance at 15 January 2014
Profit after income tax expense for the period
Other comprehensive income for the period, net of tax
Total comprehensive income for the period
Transactions with owners in their capacity as owners:
Share-based payments (note 41)
Group reorganisation (note 24)
Balance at 30 June 2014
Consolidated
Balance at 1 July 2014
Profit after income tax expense for the year
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 payments (note 41)
Dividends paid (note 26)
Balance at 30 June 2015
Issued
capital
$’000
Reserves
$’000
Retained
profits
$’000
Total
equity
$’000
–
–
–
–
–
–
–
–
(336)
(336)
–
122
(119,158)
–
–
15,620
15,620
–
(336)
15,620
15,284
–
–
–
232,768
122
(119,158)
232,768
(119,372)
15,620
129,016
Issued
capital
$’000
Reserves
$’000
Retained
profits
$’000
Total
equity
$’000
232,768
(119,372)
15,620
129,016
–
–
–
–
–
–
722
722
337
–
40,482
40,482
–
722
40,482
41,204
–
337
(21,175)
(21,175)
232,768
(118,313)
34,927
149,382
The above statement of changes in equity should be read in conjunction with the accompanying notes
Annual Report 2015
31
Statement of Cash Flows
For the year ended 30 June 2015
Cash flows from operating activities
Receipts from customers (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Interest received
Interest and other finance costs paid
Income taxes paid
Net cash from operating activities
Cash flows from investing activities
Proceeds from disposal of lease portfolio assets
Acquisition of lease portfolio assets
Payments for property, plant and equipment
Payments for intangibles
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Share issue transaction costs
Proceeds from borrowings
Repayment of borrowings
Dividends paid
Net cash received on acquisition of SG Fleet Holdings Pty Limited
Net cash from/(used in) financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Effects of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at the end of the financial year
Consolidated
Year ended
30 Jun 2015
$’000
Period ended
30 Jun 2014
$’000
Note
191,231
(116,919)
1,951
(3,518)
(11,213)
61,532
16,895
(24,223)
(305)
(1,965)
(9,598)
–
–
13,117
(13,349)
(21,175)
–
(21,407)
30,527
57,906
710
89,143
39
11
11
13
14
26
8
65,860
(35,174)
495
(1,518)
(4,892)
24,771
5,851
(8,060)
(334)
(379)
(2,922)
1,604
(5,824)
7,364
(6,372)
–
39,285
36,057
57,906
–
–
57,906
The above statement of cash flows should be read in conjunction with the accompanying notes
32
SG Fleet Group Limited
Notes to the Financial Statements
30 June 2015
Note 1. General information
The financial statements cover SG Fleet Group Limited
as a Group consisting of SG Fleet Group Limited (the
‘Company’ or ‘parent entity’) and the subsidiaries
it controlled at the end of, or during, the year (the
‘Group’). The financial statements are presented in
Australian Dollars, which is SG Fleet Group Limited’s
functional and presentation currency.
SG Fleet Group Limited is a listed public company limited
by shares, incorporated and domiciled in Australia. Its
registered office and principal place of business is:
Level 2, Building 3
20 Bridge Street
Pymble NSW 2073
During the financial year the principal continuing
activities of the Group consisted of motor vehicle fleet
management and salary packaging services.
The financial statements were authorised for issue, in
accordance with a resolution of Directors, on 17 August
2015. The Directors have the power to amend and
reissue the financial statements.
Note 2. Significant accounting policies
The principal accounting policies adopted in the
preparation of the financial statements are set out
below. These policies have been consistently applied to
all the periods presented, unless otherwise stated.
Basis of preparation
These general purpose financial statements have been
prepared in accordance with Australian Accounting
Standards and Interpretations issued by the Australian
Accounting Standards Board (‘AASB’) and the
Corporations Act 2001, as appropriate for for-profit
oriented entities. These financial statements also
comply with International Financial Reporting Standards
as issued by the International Accounting Standards
Board (‘IASB’).
Historical cost convention
The financial statements have been prepared under the
historical cost convention, except for derivative financial
instruments at fair value.
Critical accounting estimates
The preparation of the financial statements requires
the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the
process of applying the Group’s accounting policies.
The areas involving a higher degree of judgement
or complexity, or areas where assumptions and
estimates are significant to the financial statements,
are disclosed in note 3.
Accounting period
The current period results are for the financial year
ended 30 June 2015. The comparative results are for the
period from 6 March 2014, when the Company acquired
SG Fleet Holdings Pty Limited and its subsidiaries,
to 30 June 2014.
Parent entity information
In accordance with the Corporations Act 2001, these
financial statements present the results of the Group
only. Supplementary information about the parent entity
is disclosed in note 35.
Principles of consolidation
The consolidated financial statements incorporate
the assets and liabilities of all subsidiaries of SG Fleet
Group Limited as at 30 June 2015 and the results of
all subsidiaries for the year then ended.
Subsidiaries are all those entities over which the Group
has control. The Group controls an entity when the
Group is exposed to, or has rights to, variable returns
from its involvement with the entity and has the ability
to affect those returns through its power to direct the
activities of the entity. Subsidiaries are fully consolidated
from the date on which control is transferred to the
Group. They are deconsolidated from the date that
control ceases.
Intercompany transactions, balances and unrealised
gains on transactions between entities in the Group are
eliminated. Unrealised losses are also eliminated unless
the transaction provides evidence of the impairment of
the asset transferred.
The acquisition of common control subsidiaries is
accounted for using the common control method.
The acquisition of other subsidiaries is accounted for
using the acquisition method of accounting. A change
in ownership interest, without the loss of control, is
accounted for as an equity transaction, where the
difference between the consideration transferred and
the book value of the share of the non-controlling
interest acquired is recognised directly in equity
attributable to the parent.
Operating segments
Operating segments are presented using the
‘management approach’, where the information
presented is on the same basis as the internal reports
provided to the Chief Operating Decision Makers
(‘CODM’). The CODM is responsible for the allocation
of resources to operating segments and assessing
their performance.
Foreign currency translation
The financial statements are presented in Australian
Dollars, which is SG Fleet Group Limited’s functional
and presentation currency.
Annual Report 2015
33
Notes to the Financial Statements
30 June 2015
Note 2. Significant accounting policies continued
Foreign currency transactions
Foreign currency transactions are translated into
Australian Dollars 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 financial
period-end exchange rates of monetary assets and
liabilities denominated in foreign currencies are
recognised in profit or loss.
Foreign operations
The assets and liabilities of foreign operations are
translated into Australian Dollars using the exchange
rates at the reporting date. The revenues and expenses
of foreign operations are translated into Australian
Dollars using the average exchange rates, which
approximate the rate at the date of the transaction, for
the period. All resulting foreign exchange differences are
recognised in other comprehensive income through the
foreign currency reserve in equity.
The foreign currency reserve is recognised in profit
or loss when the foreign operation or net investment
is disposed of.
Revenue recognition
Revenue is recognised when it is probable that the
economic benefit will flow to the Group and the revenue
can be reliably measured. Revenue is measured at the
fair value of the consideration received or receivable.
Management and maintenance income
Fleet management income and management fees are
brought to account on a straight line basis over the term
of the lease.
Maintenance income is recognised on a stage of
completion basis in order that profit is recognised
when the services are provided. Maintenance costs are
expensed as and when incurred.
Additional products and services
Revenue from the sale of additional products and
services is recognised when it is received or when the
right to receive payment is established.
Funding commissions
Introductory commissions earned are recognised
in profit or loss in full in the month in which the
finance is introduced to the relevant financier.
Trailing commissions earned from financiers are
recognised over the life of the lease.
End of lease income
Income earned after the expiry of the lease is
recognised when it is received or when the right
to receive payment is established.
Rental income
Rental income from operating leases is recognised in
profit or loss on a straight line basis over the lease term.
Other income
Other income is recognised when it is received or when
the right to receive payment is established.
Interest
Interest revenue is recognised as interest accrues using
the effective interest method. This is a method of
calculating the amortised cost of a financial asset and
allocating the interest income over the relevant period
using the effective interest rate, which is the rate that
exactly discounts estimated future cash receipts through
the expected life of the financial asset to the net
carrying amount of the financial asset.
Income tax
The income tax expense or benefit for the period is
the tax payable on that period’s taxable income based
on the applicable income tax rate for each jurisdiction,
adjusted by the changes in deferred tax assets and
liabilities attributable to temporary differences, unused
tax losses and the adjustment recognised for prior
periods, where applicable.
Deferred tax assets and liabilities are recognised for
temporary differences at the tax rates expected to be
applied when the assets are recovered or liabilities are
settled, based on those tax rates that are enacted or
substantively enacted, except for:
• when the deferred income tax asset or liability arises
from the initial recognition of goodwill or an asset
or liability in a transaction that is not a business
combination and that, at the time of the transaction,
affects neither the accounting nor taxable profits; or
• when the taxable temporary difference is associated
with interests in subsidiaries, associates or joint
ventures, and the timing of the reversal can be
controlled and it is probable that the temporary
difference will not reverse in the foreseeable future.
Deferred tax assets are recognised for deductible
temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to
utilise those temporary differences and losses.
The carrying amount of recognised and unrecognised
deferred tax assets are reviewed at each reporting
date. Deferred tax assets recognised are reduced to the
extent that it is no longer probable that future taxable
profits will be available for the carrying amount to be
recovered. Previously unrecognised deferred tax assets
are recognised to the extent that it is probable that there
are future taxable profits available to recover the asset.
34
SG Fleet Group Limited
Deferred tax assets and liabilities are offset only where
there is a legally enforceable right to offset current tax
assets against current tax liabilities and deferred tax
assets against deferred tax liabilities, and they relate to
the same taxable authority on either the same taxable
entity or different taxable entities which intend to
settle simultaneously.
SG Fleet Group Limited (the ‘head entity’) and its
wholly-owned Australian subsidiaries have formed
an income tax consolidated group under the tax
consolidation regime. The head entity and each
subsidiary in the tax consolidated group continue to
account for their own current and deferred tax amounts.
The tax consolidated group has applied the ‘separate
taxpayer within group’ approach in determining the
appropriate amount of taxes to allocate to members
of the tax consolidated group.
In addition to its own current and deferred tax amounts,
the head entity also recognises the current tax liabilities
(or assets) and the deferred tax assets arising from
unused tax losses and unused tax credits assumed from
each subsidiary in the tax consolidated group.
Assets or liabilities arising under tax funding agreements
with the tax consolidated entities are recognised as
amounts receivable from or payable to other entities
in the tax consolidated group. The tax funding
arrangement ensures that the intercompany charge
equals the current tax liability or benefit of each tax
consolidated group member, resulting in neither a
contribution by the head entity to the subsidiaries nor
a distribution by the subsidiaries to the head entity.
Cash and cash equivalents
Cash and cash equivalents includes cash on hand,
deposits held at call with financial institutions, other
short-term, highly liquid investments with original
maturities of three months or less that are readily
convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value.
Finance, trade and other receivables
Trade receivables are initially recognised at fair value
and subsequently measured at amortised cost using
the effective interest method, less any provision
for impairment.
For finance lease and contract purchase agreements
see ‘Leases – Group as lessor’ accounting policy.
Other receivables are recognised at amortised cost,
less any provision for impairment.
Inventories
End-of-term operating lease assets are stated at the
lower of cost and net realisable value. Cost comprises
purchase and delivery costs, net of rebates and discounts
received or receivable.
Net realisable value is the lower of (i) estimated
selling price in the ordinary course of business less the
estimated costs of completion and the estimated costs
necessary to make the sale and (ii) cost less residual
value provision.
Derivative financial instruments
Derivatives are initially recognised at fair value on
the date a derivative contract is entered into and are
subsequently remeasured to their fair value at each
reporting date. The accounting for subsequent changes
in fair value depends on whether the derivative is
designated as a hedging instrument, and if so, the
nature of the item being hedged.
Cash flow hedges
Cash flow hedges are used to cover the Group’s
exposure to variability in cash flows that is attributable
to particular risks associated with a recognised asset
or liability or a firm commitment which could affect
profit or loss. The effective portion of the gain or
loss on the hedging instrument is recognised in other
comprehensive income through the hedging reserve in
equity, whilst the ineffective portion is recognised in
profit or loss. Amounts taken to equity are transferred
out of equity and included in the measurement
of the hedged transaction when the forecast
transaction occurs.
Cash flow hedges are tested for effectiveness on a
regular basis both retrospectively and prospectively to
ensure that each hedge is highly effective and continues
to be designated as a cash flow hedge. If the forecast
transaction is no longer expected to occur, the amounts
recognised in equity are transferred to profit or loss.
If the hedging instrument is sold, terminated, expires,
exercised without replacement or rollover, or if the
hedge becomes ineffective and is no longer a designated
hedge, amounts previously recognised in equity remain
in equity until the forecast transaction occurs.
Annual Report 2015
35
Note 2. Significant accounting policies continued
Property, plant and equipment
Plant and equipment is stated at historical cost less
accumulated depreciation and impairment. Historical
cost includes expenditure that is directly attributable
to the acquisition of the items.
Depreciation is calculated on a straight-line basis to write
off the net cost of each item of property, plant and
equipment over their expected useful lives as follows:
Leasehold improvements
Fixtures and fittings
Motor vehicles
five years
three to eight years
four years
The residual values, useful lives and depreciation
methods are reviewed, and adjusted if appropriate,
at each reporting date.
Leasehold improvements are depreciated over the
unexpired period of the lease or the estimated useful life
of the assets, whichever is shorter.
An item of property, plant and equipment is
derecognised upon disposal or when there is no future
economic benefit to the Group. Gains and losses
between the carrying amount and the disposal proceeds
are taken to profit or loss.
For leased motor vehicles see ‘Leases – Group as lessor –
leased motor vehicles assets’ accounting policy.
Leases
Group as lessee
The determination of whether an arrangement is
or contains a lease is based on the substance of the
arrangement and requires an assessment of whether
the fulfilment of the arrangement is dependent on the
use of a specific asset or assets and the arrangement
conveys a right to use the asset.
A distinction is made between finance leases, which
effectively transfer from the lessor to the lessee
substantially all the risks and benefits incidental to
ownership of leased assets, and operating leases, under
which the lessor effectively retains substantially all such
risks and benefits.
Finance leases are capitalised. A lease asset and liability
are established at the fair value of the leased assets, or
if lower, the present value of minimum lease payments.
Lease payments are allocated between the principal
component of the lease liability and the finance costs,
so as to achieve a constant rate of interest on the
remaining balance of the liability.
Leased assets acquired under a finance lease are
depreciated over the asset’s useful life or over the
shorter of the asset’s useful life and the lease term if
there is no reasonable certainty that the Group will
obtain ownership at the end of the lease term.
Operating lease payments, net of any incentives received
from the lessor, are charged to profit or loss on a
straight-line basis over the term of the lease.
Group as lessor
Amounts due from customers under finance leases
and contract purchase agreements are recorded as
receivables. Finance and contract purchase receivables
are initially recognised at an amount equal to the
present value of the minimum instalment payment
receivable plus the present value of any unguaranteed
residual value expected to accrue at the end of the
contract term. Interest income is allocated to accounting
periods so as to reflect a constant periodic rate of return
on the Group’s net investment outstanding in respect
of the contracts.
Group as lessor – leased motor vehicles assets
Full maintenance lease assets are stated at historical cost
less accumulated depreciation.
The cost of full maintenance lease assets includes the
purchase cost including non-refundable purchase taxes
and other expenditure that is directly attributable to the
acquisition of the assets to bring the assets held-for-use
in the lease asset portfolio to working condition for the
intended use.
The depreciable amount of the asset is depreciated
over its estimated useful life of seven years on a
straight-line basis.
Lease rentals receivable and payable on operating leases
are recognised in profit or loss in periodic amounts over
the effective lease term on a straight line basis.
Intangible assets
Intangible assets acquired as part of a business
combination, other than goodwill, are initially measured
at their fair value at the date of the acquisition. Intangible
assets acquired separately are initially recognised at cost.
Indefinite life intangible assets are not amortised and are
subsequently measured at cost less any impairment. Finite
life intangible assets are subsequently measured at cost
less amortisation and any impairment. The gains or losses
recognised in profit or loss arising from the derecognition
of intangible assets are measured as the difference
between net disposal proceeds and the carrying amount
of the intangible asset. The method and useful lives
of finite life intangible assets are reviewed annually.
Changes in the expected pattern of consumption or
useful life are accounted for prospectively by changing
the amortisation method or period.
36
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015
Goodwill
Where an entity or operation is acquired in a business
combination, that is not a common control transaction,
the identifiable net assets acquired are measured at
fair value. The excess of the fair value of the cost of
the acquisition over the fair value of the identifiable
net assets acquired is brought to account as goodwill.
Goodwill is not amortised. Instead, goodwill is tested
annually for impairment, or more frequently if events
or changes in circumstances indicate that it might
be impaired, and is carried at cost less accumulated
impairment losses. Impairment losses on goodwill are
taken to profit or loss and are not subsequently reversed.
Customer contracts
Customer contracts are assessed as having an indefinite
life. Indefinite life customer contracts are not amortised.
Instead they are tested annually for impairment, or more
frequently if events or changes in circumstances indicate
that they might be impaired, and are carried at cost less
accumulated impairment losses.
Software
Significant costs associated with software are deferred
and amortised on a straight-line basis over the period of
their expected benefit, being their finite useful lives of
between two and eight years.
Impairment of non-financial assets
Goodwill and other intangible assets that have an
indefinite useful life are not subject to amortisation and
are tested annually for impairment, or more frequently
if events or changes in circumstances indicate that
they might be impaired. Other non-financial 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.
Recoverable amount is the higher of an asset’s fair
value less costs of disposal and value-in-use. The
value-in-use is the present value of the estimated
future cash flows relating to the asset using a pre-tax
discount rate specific to the asset or cash-generating
unit to which the asset belongs. Assets that do not
have independent cash flows are grouped together
to form a cash-generating unit.
Trade and other payables
These amounts represent liabilities for goods and
services provided to the Group prior to the end of
the financial year and which are unpaid. Due to their
short-term nature they are measured at amortised cost
and are not discounted. The amounts are unsecured and
are usually paid within 30 days of recognition.
Borrowings
Loans and borrowings are initially recognised at the fair
value of the consideration received, net of transaction
costs. They are subsequently measured at amortised
cost using the effective interest method.
Maintenance deferred income liability
Income is measured by reference to the stage
of completion based on the proportion that the
maintenance costs incurred to date bear to the
estimated costs of completion of the contract lease.
Deferred income is recognised based on the differences
in maintenance fee derived in accordance with the
contract billing cycle and income based on stage of
completion by reference to costs incurred.
Finance costs
Finance costs attributable to qualifying assets are
capitalised as part of the asset. All other finance costs
are expensed in the period in which they are incurred.
Provisions
Provisions are recognised when the Group has a present
(legal or constructive) obligation as a result of a past
event, it is probable the Group will be required to settle
the obligation, and a reliable estimate can be made of
the amount of the obligation. The amount recognised
as a provision is the best estimate of the consideration
required to settle the present obligation at the reporting
date, taking into account the risks and uncertainties
surrounding the obligation. If the time value of money
is material, provisions are discounted using a current
pre-tax rate specific to the liability. The increase in
the provision resulting from the passage of time is
recognised as a finance cost.
Residual values
The Group has entered into various agreements with
its financiers that govern the transfer of the residual
value risk inherent in operating lease assets from the
financier to the Group at the end of the underlying
lease agreement. These agreements include put/call
options, sale direction deeds and guaranteed buyback
arrangements. The residual value provision is created
on an onerous pool basis to cover future shortfalls on
the disposal of these vehicles. Assets are grouped into
homogenous groups which are then analysed further
into maturity pools. A provision is raised for a maturity
pool if the forecast loss on disposal of the assets in the
pool exceeds the future fee income that the pool will
generate between the reporting date and the maturity
date. Maturity pools in a net profit position are not
offset against maturity pools in a net loss position.
Annual Report 2015
37
Note 2. Significant accounting policies continued
Employee benefits
Short-term employee benefits
Employee benefits expected to be settled within
12 months of the reporting date are measured at
the amounts expected to be paid when the liabilities
are settled.
Other long-term employee benefits
The liability for employee benefits not expected to
be settled within 12 months of the reporting date
is measured as the present value of expected future
payments to be made in respect of services provided by
employees up to the reporting date using the projected
unit credit method. Consideration is given to expected
future wage and salary levels, experience of employee
departures and periods of service. Expected future
payments are discounted using market yields at the
reporting date based on high quality corporate bonds
with terms to maturity and currency that match, as
closely as possible, the estimated future cash outflows.
Defined contribution superannuation expense
Contributions to defined contribution superannuation
plans are expensed in the period in which they
are incurred.
Share-based payments
Equity-settled share-based compensation benefits are
provided to employees.
Equity-settled transactions are awards of shares,
or options over shares, that are provided to employees
in exchange for the rendering of services.
The cost of equity-settled transactions are measured
at fair value on grant date. Fair value is independently
determined using either the Binomial or Black-Scholes
option pricing model that takes into account the exercise
price, the term of the option, the impact of dilution, the
share price at grant date and expected price volatility of
the underlying share, the expected dividend yield and
the risk free interest rate for the term of the option,
together with non-vesting conditions that do not
determine whether the Group receives the services that
entitle the employees to receive payment. No account is
taken of any other vesting conditions.
The cost of equity-settled transactions are recognised
as an expense with a corresponding increase in equity
over the vesting period. The cumulative charge to profit
or loss is calculated based on the grant date fair value of
the award, the best estimate of the number of awards
that are likely to vest and the expired portion of the
vesting period. The amount recognised in profit or loss
for the period is the cumulative amount calculated at
each reporting date less amounts already recognised in
previous periods.
38
SG Fleet Group Limited
Market conditions are taken into consideration in
determining fair value. Therefore any awards subject to
market conditions are considered to vest irrespective of
whether or not that market condition has been met,
provided all other conditions are satisfied.
If equity-settled awards are modified, as a minimum
an expense is recognised as if the modification has
not been made. An additional expense is recognised,
over the remaining vesting period, for any modification
that increases the total fair value of the share-based
compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the
Group or employee, the failure to satisfy the condition
is treated as a cancellation. If the condition is not within
the control of the Group or employee and is not satisfied
during the vesting period, any remaining expense for the
award is recognised over the remaining vesting period,
unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as
if it has vested on the date of cancellation, and any
remaining expense is recognised immediately. If a new
replacement award is substituted for the cancelled
award, the cancelled and new award are treated as if
they were a modification.
Fair value measurement
When an asset or liability, financial or non-financial,
is measured at fair value for recognition or disclosure
purposes, the fair value is based on the price that would
be received to sell an asset or paid to transfer a liability
in an orderly transaction between market participants
at the measurement date; and assumes that the
transaction will take place either: in the principal market;
or in the absence of a principal market, in the most
advantageous market.
Fair value is measured using the assumptions that market
participants would use when pricing the asset or liability,
assuming they act in their economic best interest. For
non-financial assets, the fair value measurement is based
on its highest and best use. Valuation techniques that
are appropriate in the circumstances and for which
sufficient data are available to measure fair value, are
used, maximising the use of relevant observable inputs
and minimising the use of unobservable inputs.
Assets and liabilities measured at fair value are
classified, into three levels, using a fair value hierarchy
that reflects the significance of the inputs used in
making the measurements. Classifications are reviewed
each reporting date and transfers between levels are
determined based on a reassessment of the lowest level
input that is significant to the fair value measurement.
Notes to the Financial Statements30 June 2015 For recurring and non-recurring fair value measurements,
external valuers may be used when internal expertise
is either not available or when the valuation is deemed
to be significant. External valuers are selected based on
market knowledge and reputation. Where there is a
significant change in fair value of an asset or liability from
one period to another, an analysis is undertaken, which
includes a verification of the major inputs applied in the
latest valuation and a comparison, where applicable, with
external sources of data.
Issued capital
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.
Dividends
Dividends are recognised when declared during the
financial year and are no longer at the discretion of
the Company.
Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the
profit attributable to the owners of SG Fleet Group
Limited, excluding any costs of servicing equity other
than ordinary shares, by the weighted average number
of ordinary shares outstanding during the financial year,
adjusted for bonus elements in ordinary shares issued
during the financial year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in
the determination of basic earnings per share to take
into account the after income tax effect of interest and
other financing costs associated with dilutive potential
ordinary shares and the weighted average number of
shares assumed to have been issued for no consideration
in relation to dilutive potential ordinary shares.
Rounding of amounts
The Company is of a kind referred to in Class Order
98/100, issued by the Australian Securities and
Investments Commission, relating to ‘rounding-
off’. Amounts in this report have been rounded off
in accordance with that Class Order to the nearest
thousand dollars, or in certain cases, the nearest dollar.
New Accounting Standards and Interpretations not
yet mandatory or early adopted
Australian Accounting Standards and Interpretations that
have recently been issued or amended but are not yet
mandatory, have not been early adopted by the Group
for the annual reporting period ended 30 June 2015.
The Group’s assessment of the impact of these new or
amended Accounting Standards and Interpretations,
most relevant to the Group, are set out below.
AASB 9 Financial Instruments
This standard is applicable to annual reporting periods
beginning on or after 1 January 2018. The standard
replaces all previous versions of AASB 9 and completes
the project to replace IAS 39 ‘Financial Instruments:
Recognition and Measurement’. AASB 9 introduces new
classification and measurement models for financial
assets. New hedge accounting requirements are
intended to more closely align the accounting treatment
with the risk management activities of the entity. New
impairment requirements will use an ‘expected credit
loss’ (‘ECL’) model to recognise an allowance. The Group
will adopt this standard from 1 July 2018 but the impact
of its adoption is not likely to be material.
AASB 15 Revenue from Contracts with Customers
This standard is currently applicable to annual reporting
periods beginning on or after 1 January 2017. Exposure
Draft (ED 263) ‘Effective Date of AASB 15’ proposes to
defer the application date by one year (1 January 2018).
The standard provides a single standard for revenue
recognition. The core principle of the standard is that
an entity will recognise revenue to depict the transfer of
promised goods or services to customers in an amount
that reflects the consideration to which the entity
expects to be entitled in exchange for those goods or
services). The Group expects to adopt this standard from
1 July 2018 but the impact of its adoption is yet to be
assessed by the Group.
Note 3. Critical accounting judgements,
estimates and assumptions
The preparation of the financial statements requires
management to make judgements, estimates and
assumptions that affect the reported amounts in the
financial statements. Management continually evaluates
its judgements and estimates in relation to assets,
liabilities, contingent liabilities, revenue and expenses.
Management bases its judgements, estimates and
assumptions on historical experience and on other
various factors, including expectations of future events,
management believes to be reasonable under the
circumstances. The resulting accounting judgements and
estimates will seldom equal the related actual results.
The judgements, estimates and assumptions that have
a significant risk of causing a material adjustment to
the carrying amounts of assets and liabilities (refer to
the respective notes) within the next financial year are
discussed below.
Annual Report 2015
39
Note 3. Critical accounting judgements, estimates
and assumptions continued
Revenue from maintenance income
As discussed in note 2, the Group estimates the
maintenance income on a stage of completion
approach. These calculations require the use of
assumptions, including an estimation of the stage of
completion and the profit margin to be achieved over
the life of the contract.
or expense when a contingency is released could have
resulted in the Exit Fee and the employee expenses
being recognised before the formation of the SG
Fleet Group (i.e. by anticipating the consummation
of the transaction).
If the Exit Fee and employee expenses had been
recognised as transactions of the pre-formation period,
the impact would have been to reduce net profit for the
period ended 30 June 2014 by $1,424,000.
Goodwill and other indefinite life intangible assets
The Group tests annually, or more frequently if events
or changes in circumstances indicate impairment,
whether goodwill and other indefinite life intangible
assets have suffered any impairment, in accordance with
the accounting policy stated in note 2. The recoverable
amounts of cash-generating units, to which these assets
belong, have been determined based on valu-in-use
calculations. These calculations require the use of
assumptions, including estimated discount rates based
on the current cost of capital and growth rates of the
estimated future cash flows.
Residual values
As discussed in note 2, the Group has entered into
various agreements with its financiers relating to residual
value risk inherent in operating lease assets being
transferred to the Group at the end of the underlying
lease agreement. A provision is raised where the forecast
loss on disposal of the assets in the pool exceeds the
expected future fee income that the pool will generate.
The expected future income is estimated based on past
experience and likely market conditions at the time of
disposal of the assets.
IPO Exit Fee and Bonus Shares and Bonus Payments
expense (comparative period)
As part of the Initial Public Offering (‘IPO’) that occurred
in comparative period ended 30 June 2014, the Group
received an Exit Fee from the Exiting Shareholders
in compensation for the services performed by
management in pursuing the IPO. The services to the
Exiting Shareholders were mainly performed in the period
preceding the IPO, but the Exit Fee was conditional upon
the completion of the transactions that resulted in the
formation of SG Fleet Group Limited and its subsidiaries
(‘SG Fleet Group’). Therefore the Exit Fee and associated
bonus shares and bonus payments (‘the employee
expenses’) that were conditional upon the IPO were
recognised in profit or loss of the newly formed SG Fleet
Group in the period from 6 March 2014 to 30 June 2014.
The Directors believe that the recognition of the above
transactions in the prior period was appropriate.
However, the Directors note that an alternative
interpretation of when to recognise items of income
The Directors note that the alternative interpretation
would have no impact on the pro forma net profit
for the period ended 30 June 2014 (as presented
in the Chief Executive Officer’s Report in the 2014
Annual Report), the net profit for the year ended
30 June 2015 or the retained earnings as at 30 June
2015 or 30 June 2014.
Transaction costs on the issue of shares
(comparative period)
In the period ended 30 June 2014, $5,824,000 of
transaction costs, net of tax, associated with the issue
of new shares were deducted from equity in accordance
with the Group’s accounting policies.
An alternative interpretation of AASB 132 ‘Financial
Instruments: Presentation’ would be that transaction
costs associated with the issue of new shares that
replace existing shares should be expensed in profit or
loss and not treated as a deduction in equity. Under this
alternative interpretation, transaction costs should be
apportioned between equity and expense where they
cover both the issue of new shares and the replacement
of existing shares.
If the Group had adopted the alternative interpretation,
$3,635,000 of post-tax transaction costs would have
been expensed in profit or loss for the period 6 March
2014 to 30 June 2014 reducing profit after income
tax from $15,620,000 to $11,985,000. The balance of
$2,189,000 in post-tax transaction costs would have
been recognised as a pre-acquisition expense in the
profit or loss prior to 6 March 2014 and would thus
have resulted in a reduction in retained earnings and
an increase in issued capital of $2,189,000.
The alternative interpretation would have no impact
on the net assets of the Group as at 30 June 2014 as
the issued capital would have increased by an amount
equal to the reduction in retained earnings resulting in
total equity remaining unchanged at $129,016,000. The
Directors note that the alternative interpretation would
have no impact on the pro forma net profit for the
period ended 30 June 2014 (as presented in the Chief
Executive Officer’s Report in the 2014 Annual Report)
or the net profit for the year ended 30 June 2015.
40
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015 Note 4. Operating segments
Identification of reportable operating segments
The Group is organised into geographic operating segments: Australia, New Zealand, United Kingdom and
Corporate. These operating segments are based on the internal reports that are reviewed and used by the Board
of Directors (who are identified as the Chief Operating Decision Makers (‘CODM’)) in assessing performance and
in determining the allocation of resources. There is no aggregation of operating segments.
The CODM reviews EBITDA (earnings before interest, tax, depreciation and amortisation). The accounting policies
adopted for internal reporting to the CODM are consistent with those adopted in the financial statements.
Prior year balances have been reclassified from Corporate segment into Australia segment to reflect how the
balances are monitored by the CODM.
Intersegment receivables, payables and loans
Intersegment loans are initially recognised at the consideration received. Intersegment loans receivable and loans
payable that earn or incur non-market interest are not adjusted to fair value based on market interest rates.
Intersegment loans are eliminated on consolidation.
Major customers
There are no major customers that contributed more than 10% of revenue to the Group.
Operating segment information
Australia
$’000
New Zealand
$’000
United
Kingdom
$’000
Corporate
$’000
Intersegment
eliminations/
unallocated
$’000
Total
$’000
Consolidated – Year ended 30 Jun 2015
Revenue
Sales to external customers
162,078
2,596
5,106
Interest
Total revenue
EBITDA
Depreciation and amortisation
Finance costs
Profit/(loss) before income
tax expense
Income tax expense
Profit after income tax expense
Assets
Segment assets
Total assets
Liabilities
Segment liabilities
Total liabilities
1,916
24
163,994
2,620
69,033
(3,978)
(580)
263
(643)
(3)
9
5,115
1,140
(2,477)
(273)
–
2
2
(1,012)
(57)
(2,647)
(354)
169,426
–
1,951
(354)
171,377
15
–
(15)
69,439
(7,155)
(3,518)
64,475
(383)
(1,610)
(3,716)
–
58,766
287,558
6,261
16,159
148,573
3,293
8,730
–
–
–
–
(18,284)
40,482
309,978
309,978
160,596
160,596
Annual Report 2015
41
Note 4. Operating segments continued
Australia
$’000
New Zealand
$’000
United
Kingdom
$’000
Corporate
$’000
Intersegment
eliminations/
unallocated
$’000
Consolidated – Period ended 30 Jun 2014
Total
$’000
63,588
495
64,083
26,574
(1,757)
(1,088)
23,729
(8,109)
15,620
52,961
480
53,441
18,442
(809)
(374)
746
12
758
89
(189)
–
1,838
8,043
3
1,841
626
(759)
(67)
–
8,043
7,407
–
(637)
17,259
(100)
(200)
6,770
–
–
–
10
–
(10)
–
258,638
4,510
14,426
141,292
987
6,279
–
–
–
277,574
277,574
–
148,558
148,558
Consolidated
Year ended
30 Jun 2015
$’000
Period ended
30 Jun 2014
$’000
63,970
48,771
29,305
11,275
10,819
5,286
–
20,156
16,938
8,556
4,285
3,489
2,024
8,140
169,426
63,588
1,951
495
171,377
64,083
Revenue
Sales to external customers
Interest
Total revenue
EBITDA
Depreciation and amortisation
Finance costs
Profit/(loss) before income
tax expense
Income tax expense
Profit after income tax expense
Assets
Segment assets
Total assets
Liabilities
Segment liabilities
Total liabilities
Note 5. Revenue
Sales revenue
Management and maintenance income
Additional products and services
Funding commissions
End of lease income
Rental income
Other income
Initial public offering – exit fee
Other revenue
Interest
Revenue
42
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015 Note 6. Expenses
Profit before income tax includes the following specific expenses:
Depreciation
Leasehold improvements
Fixtures and fittings
Motor vehicles
Leased motor vehicle assets
Total depreciation
Amortisation
Software
Total depreciation and amortisation
Impairment
Intangibles – customer contracts
Finance costs
External borrowing costs for corporate debt
External borrowing costs for lease portfolio
Net foreign exchange losses
Total finance costs
Rental expense relating to operating leases
Minimum lease payments
Superannuation expense
Consolidated
Year ended
30 Jun 2015
$’000
Period ended
30 Jun 2014
$’000
7
431
59
6,020
6,517
581
7,098
57
2,664
765
89
3,518
3
149
19
1,407
1,578
179
1,757
–
637
262
189
1,088
4,648
1,526
Defined contribution superannuation expense
3,136
982
Annual Report 2015
43
Note 7. Income tax expense
Income tax expense
Current tax
Deferred tax – origination and reversal of temporary differences
Aggregate income tax expense
Deferred tax included in income tax expense comprises:
Decrease in deferred tax assets (note 12)
Numerical reconciliation of income tax expense and tax at the statutory rate
Profit before income tax expense
Tax at the statutory tax rate of 30%
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Entertainment expenses
Non-deductible expenses
Assessed loss
Preference share dividends
Bonus shares
Current year tax losses not recognised
Difference in overseas tax rates
Income tax expense
Amounts credited directly to equity
Deferred tax assets (note 12)
Tax losses not recognised
Unused tax losses for which no deferred tax asset has been recognised
Potential tax benefit at the statutory tax rate of 30%
Consolidated
Year ended
30 Jun 2015
$’000
Period ended
30 Jun 2014
$’000
17,735
549
18,284
7,032
1,077
8,109
549
1,077
58,766
17,630
23,729
7,119
43
18
–
–
–
17,691
437
156
–
11
84
(129)
1,019
8,104
–
5
18,284
8,109
–
(2,417)
11,911
3,573
9,603
2,881
The above potential tax benefit for tax losses, relating to United Kingdom and New Zealand, has not been
recognised in the statement of financial position.
44
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015 Note 8. Cash and cash equivalents
Cash at bank
Secured deposits
Amount expected to be recovered within 12 months
Consolidated
2015
$’000
79,210
9,933
89,143
89,143
2014
$’000
45,352
12,554
57,906
57,906
Secured deposits represents cash held by the Group as required under the funding arrangement between the Group
and the financiers under its lease portfolio facilities and are not available as free cash for the purpose of operations
of the Group.
Note 9. Finance, trade and other receivables
Trade receivables
Less: Provision for impairment of receivables
Prepayments
Finance lease receivables
Amount expected to be recovered within 12 months
Amount expected to be recovered after more than 12 months
Impairment of receivables
The ageing of the impaired receivables provided for above are within one year overdue.
Movements in the provision for impairment of receivables are as follows:
Opening balance
Additions through group reorganisation
Unused amounts reversed
Closing balance
Impairment of receivables are charged (or credited) to other expenses in profit or loss.
Consolidated
2014
$’000
34,776
(56)
34,720
6,866
155
41,741
41,711
30
41,741
Consolidated
2014
$’000
–
74
(18)
56
2015
$’000
33,102
(40)
33,062
6,954
56
40,072
40,062
10
40,072
2015
$’000
56
–
(16)
40
Annual Report 2015
45
Note 9. Finance, trade and other receivables continued
Past due but not impaired
Customers with balances past due but without provision for impairment of receivables amount to $257,000 as at
30 June 2015 ($nil as at 30 June 2014).
The ageing of the past due but not impaired receivables are as follows:
Within one year overdue
Finance lessor commitments
Committed at the reporting date and recognised as assets, receivable:
Within one year
One to five years
Total commitment
Less: Future finance charges
Net commitment recognised as assets
Note 10. Inventories
End-of-term operating lease assets held for disposal
Amount expected to be recovered within 12 months
Consolidated
2015
$’000
257
2014
$’000
–
Consolidated
2015
$’000
2014
$’000
53
10
63
(7)
56
130
31
161
(6)
155
Consolidated
2015
$’000
4,921
4,921
2014
$’000
4,643
4,643
46
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015 Note 11. Leased motor vehicle assets
Lease portfolio assets – at cost
Less: Accumulated depreciation
Less: Impairment
Amount expected to be recovered within 12 months
Amount expected to be recovered after more than 12 months
Consolidated
2015
$’000
26,929
(8,813)
(452)
17,664
6,064
11,600
17,664
2014
$’000
25,974
(9,814)
(472)
15,688
8,465
7,223
15,688
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are
set out below:
Consolidated
Balance at 15 January 2014
Additions
Additions through group reorganisation
Disposals
Exchange differences
Depreciation expense
Balance at 30 June 2014
Additions
Disposals
Revaluation increments
Exchange differences
Depreciation expense
Balance at 30 June 2015
Leased assets
$’000
–
8,060
15,102
(5,851)
(216)
(1,407)
15,688
24,223
(16,895)
61
607
(6,020)
17,664
Total
$’000
–
8,060
15,102
(5,851)
(216)
(1,407)
15,688
24,223
(16,895)
61
607
(6,020)
17,664
Annual Report 2015
47
Note 12. Deferred tax
Deferred tax asset comprises temporary differences attributable to:
Amounts recognised in profit or loss:
Property, plant and equipment
Employee benefits
Deferred expenses
Provisions
Doubtful debts
Deferred income
Prepayments
Accrued expenses
Amounts recognised in equity:
Transaction costs on share issue
Deferred tax asset
Amount expected to be recovered after more than 12 months
Movements:
Opening balance
Charged to profit or loss (note 7)
Credited to equity (note 7)
Additions through group reorganisation
Closing balance
Consolidated
2015
$’000
2014
$’000
85
1,451
1,608
3,741
240
6,429
(1,824)
2,753
405
1,348
(154)
4,816
235
5,417
(1,793)
2,341
14,483
12,615
–
14,483
14,483
15,032
(549)
–
–
14,483
2,417
15,032
15,032
–
(1,077)
2,417
13,692
15,032
48
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015 Note 13. Property, plant and equipment
Leasehold improvements – at cost
Less: Accumulated depreciation
Fixtures and fittings – at cost
Less: Accumulated depreciation
Motor vehicles – at cost
Less: Accumulated depreciation
Amount expected to be recovered after more than 12 months
Consolidated
2015
$’000
679
(660)
19
2,851
(1,960)
891
220
(127)
93
1,003
1,003
2014
$’000
679
(653)
26
2,535
(1,519)
1,016
233
(76)
157
1,199
1,199
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are
set out below:
Consolidated
Balance at 15 January 2014
Additions
Additions through group reorganisation
Exchange differences
Depreciation expense
Balance at 30 June 2014
Additions
Exchange differences
Depreciation expense
Balance at 30 June 2015
Leasehold
improvements
$’000
Fixtures
and fittings
$’000
Motor
vehicles
$’000
–
–
29
–
(3)
26
–
–
(7)
19
–
334
831
–
(149)
1,016
305
1
(431)
891
–
–
178
(2)
(19)
157
–
(5)
(59)
93
Total
$’000
–
334
1,038
(2)
(171)
1,199
305
(4)
(497)
1,003
Annual Report 2015
49
Note 14. Intangibles
Goodwill – at cost
Customer contracts – at cost
Less: Impairment
Software – at cost
Less: Accumulated amortisation
Amount expected to be recovered after more than 12 months
Consolidated
2015
$’000
2014
$’000
136,460
136,460
706
(57)
649
6,690
(1,107)
5,583
706
–
706
4,725
(526)
4,199
142,692
142,692
141,365
141,365
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are
set out below:
Consolidated
Balance at 15 January 2014
Additions
Additions through group reorganisation
Amortisation expense
Balance at 30 June 2014
Additions
Impairment of assets
Amortisation expense
Balance at 30 June 2015
Goodwill
$’000
–
–
136,460
–
136,460
–
–
–
136,460
Customer
contracts
$’000
Software
$’000
–
–
706
–
706
–
(57)
–
649
–
379
3,999
(179)
4,199
1,965
–
(581)
5,583
Total
$’000
–
379
141,165
(179)
141,365
1,965
(57)
(581)
142,692
Goodwill acquired through business combinations have been allocated to the following cash-generating segment:
Consolidated
2015
$’000
2014
$’000
136,460
136,460
Australia
50
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015 Impairment testing for goodwill
The impairment test was based on a value-in-use approach. The recoverable amount was determined to be higher
than the carrying amount and therefore no impairment loss was recognised. Value-in-use was determined by
discounting the future cash flows based on the following key assumptions:
• cash flows were projected based on actual operating results and the four-year business plan. Cash flow
beyond Year 4 was projected at a growth rate of 0% (2014: 0%);
• 7.5% (2014: 7.6%) per annum projected revenue growth rate;
• direct costs were forecast based on the margins historically achieved by the business;
• overheads were forecast based on current levels adjusted for inflationary increases; and
• the Company’s pre-tax weighted average cost of capital was applied in determining the recoverable amount.
The discount rate of 11.70% (2014: 11.87%) was estimated using the Capital Asset Pricing model.
The values assigned to the key assumptions represent management’s assessment of future trends in the industry
and are based on both external and internal data sources.
Sensitivity analysis
Management estimates that any reasonable changes in the key assumptions would not have a significant impact
on the value-in-use of intangible assets and goodwill that would require the assets to be impaired.
Note 15. Trade and other payables
Trade payables
Accrued expenses
Residual values payable to financiers
Amount expected to be settled within 12 months
Consolidated
2015
$’000
33,626
7,785
5,522
46,933
46,933
2014
$’000
33,812
6,628
3,541
43,981
43,981
Refer to note 27 for further information on financial instruments.
The residual values payable to financiers are secured by the underlying operating lease asset as well as by bank
guarantees and a cash lock-up of $9,933,000 (2014: $8,554,000).
Note 16. Derivative financial instruments
Interest rate swap contracts – cash flow hedges
Amount expected to be settled after more than 12 months
Refer to note 27 for further information on financial instruments.
Refer to note 28 for further information on fair value measurement.
Consolidated
2015
$’000
7
7
2014
$’000
–
–
Annual Report 2015
51
Note 17. Income tax
Provision for income tax
Amount expected to be settled within 12 months
Note 18. Employee benefits provision
Annual leave
Long service leave
Amount expected to be settled within 12 months
Amount expected to be settled after more than 12 months
Note 19. Residual risk provision
Residual risk
Amount expected to be settled within 12 months
Amount expected to be settled after more than 12 months
Consolidated
2014
$’000
2,460
2,460
Consolidated
2014
$’000
2,453
2,135
4,588
2,453
2,135
4,588
Consolidated
2014
$’000
15,949
3,555
12,394
15,949
2015
$’000
8,982
8,982
2015
$’000
2,457
2,486
4,943
2,457
2,486
4,943
2015
$’000
12,368
4,159
8,209
12,368
Residual risk provision
The provision is to recognise the future liability relating to residual value exposures as described in notes 2 and 3.
Movements in provisions
Movements in the provision during the current financial period is set out below:
Consolidated – 2015
Carrying amount at the start of the year
Residual value losses debited to the provision
Exchange differences
Carrying amount at the end of the year
52
SG Fleet Group Limited
Residual
risk
$’000
15,949
(3,588)
7
12,368
Notes to the Financial Statements30 June 2015 Note 20. Borrowings
Bank loans
Lease portfolio liabilities
Amount expected to be settled within 12 months
Amount expected to be settled after more than 12 months
Refer to note 27 for further information on financial instruments.
Total secured liabilities
The total secured liabilities are as follows:
Bank loans
Lease portfolio liabilities
Assets pledged as security
Assets pledged as security for borrowings are:
Consolidated
2014
$’000
32,250
11,266
43,516
7,877
35,639
43,516
Consolidated
2014
$’000
32,250
11,266
43,516
2015
$’000
32,250
11,618
43,868
6,162
37,706
43,868
2015
$’000
32,250
11,618
43,868
Banking facilities
The banking facility is secured by guarantees and indemnities as well as fixed and floating charges or composite
guarantees and debentures issued by the Group. The facility is repayable by way of a bullet payment of $32,250,000
in November 2018.
Lease portfolio liabilities
The lease portfolio liabilities are secured by the underlying funded assets and lease agreements, together with
irrevocable letter of credit, cash lock-ups and guarantees. These facilities are interest bearing and are repaid on a
transactional basis as and when the underlying assets are disposed of.
Residual values payable to financiers
Refer to note 15 for security to financiers of residual value payables.
Annual Report 2015
53
Note 20. Borrowings continued
Financing arrangements
Unrestricted access was available at the reporting date to the following lines of credit:
Total facilities
Banking facilities
Lease portfolio facilities
Used at the reporting date
Banking facilities
Lease portfolio facilities
Unused at the reporting date
Banking facilities
Lease portfolio facilities
Note 21. Vehicle maintenance funds
Vehicle maintenance funds
Amount expected to be settled within 12 months
Amount expected to be settled after more than 12 months
Note 22. Deferred income
Deferred income
Amount expected to be settled within 12 months
Amount expected to be settled after more than 12 months
54
SG Fleet Group Limited
Consolidated
2015
$’000
2014
$’000
56,742
40,714
97,456
49,157
11,617
60,774
7,585
29,097
36,682
2015
$’000
17,948
5,946
12,002
17,948
2015
$’000
25,547
4,117
21,430
25,547
40,314
33,561
73,875
34,061
11,266
45,327
6,253
22,295
28,548
Consolidated
2014
$’000
14,947
5,015
9,932
14,947
Consolidated
2014
$’000
23,117
3,504
19,613
23,117
Notes to the Financial Statements30 June 2015 Note 23. Equity – issued capital
Ordinary shares – fully paid
242,691,826
242,691,826
232,768
232,768
Consolidated
2015
Shares
2014
Shares
2015
$’000
2014
$’000
Movements in ordinary share capital
Details
Balance
Date
Shares
$’000
15 January 2014
2
Shares issued on acquisition of SG Fleet Holdings Pty Limited
6 March 2014
139,102,135
Issue of shares on Initial Public Offering
Bonus shares issued to employees
Transaction costs
Balance
Balance
6 March 2014
101,943,359
6 March 2014
1,646,330
–
30 June 2014
242,691,826
30 June 2015
242,691,826
–
46,951
188,595
3,046
(5,824)
232,768
232,768
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in
proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value
and the Company does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll
each share shall have one vote.
Share buy-back
There is no current on-market share buy-back.
Capital risk management
The Group’s objectives when managing capital are to safeguard its ability to continue as a going concern, so that
it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital
structure to reduce the cost of capital. The Group monitors capital on the basis of its gearing ratio. In order to
maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return
capital to shareholders, issue new shares or sell assets to reduce debts.
The Group is subject to certain financing arrangements covenants and meeting these are given priority in all capital
risk management decisions. There have been no events of default on the financing arrangements during the
financial period.
The capital risk management policy remains unchanged from the 30 June 2014 Annual Report.
Annual Report 2015
55
Note 24. Equity – reserves
Foreign currency reserve
Hedging reserve – cash flow hedges
Share-based payments reserve
Capital reserve
Consolidated
2015
$’000
393
(7)
459
2014
$’000
(336)
–
122
(119,158)
(118,313)
(119,158)
(119,372)
Foreign currency reserve
The reserve is used to recognise exchange differences arising from translation of the financial statements of foreign
operations to Australian Dollars.
Hedging reserve – cash flow hedges
The reserve is used to recognise the effective portion of the gain or loss of cash flow hedge instruments that
is determined to be an effective hedge.
Share-based payments reserve
The reserve is used to recognise the value of equity benefits provided to employees and Directors as part of their
remuneration, and other parties as part of their compensation for services.
Capital reserve
The reserve is used to recognise contributions from or to SG Fleet Group Limited and its controlled subsidiaries
by shareholders.
Group reorganisation – SG Fleet Group Limited and SG Fleet Holdings Pty Limited (comparative period)
When SG Fleet Solutions Pty Limited, a subsidiary of SG Fleet Group Limited (the legal parent and legal acquirer),
acquired SG Fleet Holdings Pty Limited and its subsidiaries (the legal subsidiary), effective 6 March 2014,
the acquisition did not meet the definition of a business combination in accordance with AASB 3 ‘Business
Combinations’. Instead, the combination was treated as a group reorganisation, through an accounting policy choice
using the common control method, as follows:
• The assets and liabilities of the combining entities were reflected at their carrying amounts. No adjustments was
made to reflect fair values, or recognise any new assets or liabilities, that would otherwise be required under
AASB 3;
• No ‘new’ goodwill was recognised as a result of the combination. The only goodwill that was recognised was the
existing goodwill of SG Holdings Pty Limited. The difference between the consideration paid of $232,768,000 and
the equity ‘acquired’ of $113,610,000 was reflected in equity as a ‘capital reserve’ of $119,158,000; and
• The statement of profit or loss and other comprehensive income for the comparative period reflects the results
of the combined entities from 6 March 2014 to 30 June 2014.
56
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015 Movements in reserves
Movements in each class of reserve during the current and previous financial year are set out below:
Consolidated
Balance at 15 January 2014
Foreign currency translation
Share-based payments
Group reorganisation
Balance at 30 June 2014
Foreign currency translation
Movement in hedge
Share-based payments
Balance at 30 June 2015
Note 25. Equity – retained profits
Foreign
currency
$’000
Cash flow
hedge
$’000
Share-based
payments
$’000
–
(336)
–
–
(336)
729
–
–
393
–
–
–
–
–
–
(7)
–
(7)
–
–
122
–
122
–
–
337
459
Retained profits at the beginning of the financial year
Profit after income tax expense for the year
Dividends paid (note 26)
Retained profits at the end of the financial year
Note 26. Equity – dividends
Dividends
Dividends paid during the financial year were as follows:
Final dividend for the period ended 30 June 2014 of
4 cents per share paid on 29 October 2014
Interim dividend for the year ended 30 June 2015 of
4.725 cents per share paid on 22 April 2015
Capital
$’000
–
–
–
Total
$’000
–
(336)
122
(119,158)
(119,158)
(119,158)
(119,372)
–
–
–
729
(7)
337
(119,158)
(118,313)
Consolidated
2015
$’000
15,620
40,482
(21,175)
34,927
2014
$’000
–
15,620
–
15,620
Consolidated
Year ended
30 Jun 2015
$’000
Period ended
30 Jun 2014
$’000
9,708
11,467
21,175
–
–
–
On 17 August 2015, the Directors declared a fully franked final dividend for the year ended 30 June 2015 of 6.117
cents per ordinary shares, to be paid on 22 October 2015 to eligible shareholders on the register as at 1 October
2015. This equates to a total estimated distribution of $14,846,000, based on the number of ordinary shares on
issue as at 30 June 2015. The financial effect of dividends declared after the reporting date are not reflected in the
30 June 2015 financial statements and will be recognised in subsequent financial reports.
Annual Report 2015
57
Note 26. Equity – dividends continued
Franking credits
Consolidated
2015
$’000
2014
$’000
Franking credits available for subsequent financial years based on a tax rate of 30%
17,749
13,622
The above amounts represent the balance of the franking account as at the end of the financial year, adjusted for:
• franking credits that will arise from the payment of the amount of the provision for income tax at the
reporting date
• franking debits that will arise from the payment of dividends recognised as a liability at the reporting date
• franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date
The franking credits above excludes exempting credits.
Note 27. Financial instruments
Financial risk management objectives
The Group’s activities expose it to a variety of financial risks: market risk (including foreign currency risk and interest
rate risk), credit risk and liquidity risk. The Group’s overall risk management program focuses on the unpredictability
of financial markets and seeks to minimise potential adverse effects on the financial performance of the Group.
The Board has overall responsibility for the establishment and oversight of the risk management framework.
The Audit, Risk and Compliance Committee, a sub-committee of the Board, has responsible for managing risk.
The Committee reports to the Board on its activities.
Risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate
risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are
reviewed regularly to reflect changes in market conditions and the Group’s activities. The Group through its training
and management standards and procedures, aims to develop a disciplined and constructive control environment in
which all employees understand their roles and obligations.
Market risk
Foreign currency risk
The Group is not exposed to any significant foreign currency risk, except for translation of financial assets and
liabilities of foreign subsidiaries into presentation currency.
Price risk
The Group is not exposed to any significant price risk.
Interest rate risk
The Group’s main interest rate risk arises from its borrowings and cash at bank. Borrowings and cash at bank
issued at variable rates expose the Group to interest rate risk. Borrowings issued at fixed rates expose the Group
to fair value risk. The policy is to ensure that at least 60% of its exposure to changes in interest rates on general
borrowings, other than lease portfolio borrowings, is on a fixed rate basis. Lease portfolio borrowings are entered
into on a fixed interest rate basis, except for lease portfolio borrowings utilised to fund lease portfolio assets in
inertia which are entered into on a variable rate basis.
58
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015 As at the reporting date, the Group had the following variable rate bank accounts and other facilities:
Consolidated
Lease portfolio facilities
Residual value payables to financiers
Cash at bank
Secured deposits
Net exposure to cash flow interest rate risk
2015
Balance
$’000
(3,149)
(5,522)
79,210
9,933
80,472
2014
Balance
$’000
(6,558)
(3,541)
45,352
12,554
47,807
An official increase / decrease in interest rates of 50 (2014: 50) basis points would have a favourable / adverse effect
on profit before tax and equity of $402,000 (2014: $239,000) per annum. The percentage change is based on the
expected volatility of interest rates using market data and analyst’s forecasts.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss
to the Group. The Group has a strict code of credit, including obtaining agency credit information, confirming
references and setting appropriate credit limits. The maximum exposure to credit risk at the reporting date to
recognised financial assets is the carrying amount, net of any provisions for impairment of those assets, as disclosed
in the statement of financial position and notes to the financial statements. The Group does not hold any collateral.
Liquidity risk
Vigilant liquidity risk management requires the Group to maintain sufficient liquid assets (mainly cash and cash
equivalents) and available borrowing facilities to be able to pay debts as and when they become due and payable.
Typically the Group ensures that it has sufficient cash or facilities on demand to meet expected operational expenses
for a period of 90 days, including the servicing of financial obligations. This excludes the potential impact of extreme
circumstances that cannot reasonably be predicted, such as natural disasters.
The Group manages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by
continuously monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and
liabilities.
Financing arrangements
Unused borrowing facilities at the reporting date:
Banking facilities
Lease portfolio facilities
Consolidated
2015
$’000
7,585
29,097
36,682
2014
$’000
6,253
22,295
28,548
Remaining contractual maturities
The following tables detail the Group’s remaining contractual maturity for its financial instrument liabilities.
The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest
date on which the financial liabilities are required to be paid. The tables include both interest and principal cash
flows disclosed as remaining contractual maturities and therefore these totals may differ from their carrying amount
in the statement of financial position.
Annual Report 2015
59
Note 27. Financial instruments continued
Consolidated – 2015
Non-derivatives
Non-interest bearing
Trade payables
Interest-bearing – variable
Lease portfolio liabilities
Residual value payable to
financiers
Interest-bearing – fixed rate
Bank loans
Lease portfolio facilities
Total non-derivatives
Derivatives
Interest rate swaps net settled
Total derivatives
Consolidated – 2014
Non-derivatives
Non-interest bearing
Trade payables
Interest-bearing – variable
Lease portfolio liabilities
Residual value payable
to financiers
Interest-bearing – fixed rate
Bank loans
Lease portfolio facilities
Total non-derivatives
1 year or less
$’000
Between 1
and 2 years
$’000
Between 2
and 5 years
$’000
Over 5 years
$’000
33,626
3,203
5,553
2,099
3,337
47,818
–
–
–
–
–
2,099
2,975
5,074
–
–
–
–
–
35,399
2,781
38,180
7
7
–
–
–
–
–
–
–
–
1 year or less
$’000
Between 1
and 2 years
$’000
Between 2
and 5 years
$’000
Over 5 years
$’000
33,812
6,626
3,565
2,922
1,650
48,575
–
144
–
33,711
1,905
35,760
–
–
–
–
1,492
1,492
–
–
–
–
–
–
Remaining
contractual
maturities
$’000
33,626
3,203
5,553
39,597
9,093
91,072
7
7
Remaining
contractual
maturities
$’000
33,812
6,770
3,565
36,633
5,047
85,827
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually
disclosed above.
60
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015 Note 28. Fair value measurement
Fair value hierarchy
The following tables detail the Group’s assets and liabilities, measured or disclosed at fair value, using a three level
hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the
measurement date
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly or indirectly
Level 3: Unobservable inputs for the asset or liability
Consolidated – 2015
Liabilities
Level 1
$’000
Level 2
$’000
Level 3
$’000
Total
$’000
Derivative financial instruments – Interest rate swap
contracts
Total liabilities
–
–
7
7
–
–
7
7
There were no transfers between levels during the financial year.
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value. The carrying amounts
of trade receivables and trade payables are assumed to approximate their fair values due to their short-term nature.
The fair value of financial liabilities is estimated by discounting the remaining contractual maturities at the current
market interest rate that is available for similar financial instruments.
Valuation techniques for fair value measurements categorised within Level 2 and Level 3
Derivative financial instruments have been valued using quoted market rates. This valuation technique maximises the
use of observable market data where it is available and relies as little as possible on entity specific estimates.
Note 29. Key management personnel disclosures
Compensation
The aggregate compensation made to Directors and other members of key management personnel of the Group
is set out below:
Short-term employee benefits
Post-employment benefits
Long-term benefits
Share-based payments
Consolidated
Year ended
30 Jun 2015
$
Period ended
30 Jun 2014
$
3,145,282
1,993,923
108,202
39,566
14,585
53,393
254,454
1,428,046
3,547,504
3,489,947
In 2014 the Non-Executive Directors were also paid $52,900 plus superannuation of $2,725 for services rendered
prior to the IPO.
Annual Report 2015
61
Note 30. Remuneration of auditors
During the financial year the following fees were paid or payable for services provided by KPMG, the auditor
of the Company:
Audit services – KPMG
Audit or review of the financial statements
Other services – KPMG
Tax services
Corporate advisory including IPO
Note 31. Commitments – operating lease receivable
Committed at the reporting date, receivable:
Within one year
One to five years
Consolidated
Year ended
30 Jun 2015
$
Period ended
30 Jun 2014
$
340,787
390,066
51,882
130,242
182,124
–
905,095
905,095
522,911
1,295,161
Consolidated
Year ended
30 Jun 2015
$’000
Period ended
30 Jun 2014
$’000
4,091
3,780
7,871
4,004
2,394
6,398
Future minimum rentals receivable includes contracted amounts for motor vehicles under non-cancellable operating
leases between one and five years.
Note 32. Contingent liabilities
The Group has entered into agreements with its lease portfolio financiers under which the residual value risk
inherent in operating leases is transferred from the financier of the asset to the Group at the end of the lease.
Under these agreements, at the end of the contractual lease term for each vehicle, the Group is obliged to pay
the guaranteed residual value amount to the financier. The company then sells the vehicles and realises a profit
or loss on sale. Bank guarantees and letters of credit have been issued to lease portfolio financiers as security
for these obligations.
An amount of $12,368,000 (2014: $15,949,000) has been recognised as a residual value provision, calculated
on an onerous pool basis, to cover potential shortfalls on the disposal of these vehicles.
The Group has executed certain guarantees and indemnities, as well as fixed and floating charges over the assets
of the Group in favour of funders as security for banking and lease portfolio facilities provided to the Group.
62
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015 Note 33. Commitments for expenditure
Lease commitments – operating
Committed at the reporting date but not recognised as liabilities:
Within one year
One to five years
More than five years
Capital commitments
Consolidated
2015
$’000
2014
$’000
2,657
3,441
25
6,123
2,657
4,266
–
6,923
Committed at the reporting date but not recognised as liabilities:
Intangible assets
3,057
4,383
Operating lease commitments includes contracted amounts for office accommodation and office equipment under
non-cancellable operating leases expiring within one to five years with, in some cases, options to extend. The leases
do not have escalation clauses. On renewal, the terms of the leases are renegotiated.
Capital commitments includes contracted amounts for the acquisition and development of Enterprise Resource
Planning (‘ERP’) systems.
Note 34. Related party transactions
Parent entities
SG Fleet Group Limited is the parent entity. The ultimate parent entity is Super Group Limited, incorporated in South
Africa and listed on the Johannesburg Stock Exchange.
Subsidiaries
Interests in subsidiaries are set out in note 36.
Key management personnel
Disclosures relating to key management personnel are set out in note 29 and the remuneration report in the
Directors’ report.
Transactions with related parties
There were no transactions with related parties during the current and previous financial year.
Receivable from and payable to related parties
There were no trade receivables from or trade payables to related parties at the current and previous reporting date.
Loans to/from related parties
There were no loans to or from related parties at the current and previous reporting date.
Annual Report 2015
63
Note 35. Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
Loss after income tax
Total comprehensive income
Statement of financial position
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Issued capital
Accumulated losses
Total equity
Parent
Year ended
30 Jun 2015
$’000
Period ended
30 Jun 2014
$’000
(709)
(709)
2015
$’000
–
(517)
(517)
2014
$’000
–
Parent
446,712
448,580
8,991
25,957
443,156
(22,401)
420,755
5,621
5,941
443,156
(517)
442,639
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity and its subsidiaries are party to a deed of cross guarantee under which each company
guarantees the debts of the others. No deficiencies of assets exist in any of these subsidiaries. Refer to
note 37 for further details.
The parent entity has also provided guarantees and indemnities for bank facilities. Refer to note 20 for
further details.
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2015 and 30 June 2014.
Capital commitments – Property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment at as 30 June 2015 and
30 June 2014.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the Group, as disclosed in
note 2, except for the following:
• investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity; and
• dividends received from subsidiaries are recognised as other income by the parent entity.
64
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015
Note 36. Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in
accordance with the accounting policy described in note 2:
Name
SG Fleet Solutions Pty Limited
SG Fleet Holdings Pty Limited
SG Fleet Finance Pty Limited
SG Fleet Investments Pty Ltd
SG Fleet Management Pty Limited
SG Fleet Australia Pty Limited
SG Fleet NZ Limited
SG Fleet UK Limited
Fleet Care Services Pty Limited
SG Fleet Salary Packaging Pty Limited
Beta Dimensions Pty Limited
SMB Car Sales Pty Limited
Principal place of business /
Country of incorporation
Australia
Australia
Australia
Australia
Australia
Australia
New Zealand
United Kingdom
Australia
Australia
Australia
Australia
Ownership interest
2015
%
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
2014
%
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
100.00
Note 37. Deed of cross guarantee
The following entities are party to a deed of cross guarantee under which each company guarantees the debts
of the others:
SG Fleet Group Limited (holding entity)
SG Fleet Solutions Pty Limited*
SG Fleet Holdings Pty Limited*
SG Fleet Finance Pty Limited*
SG Fleet Investments Pty Ltd*
SG Fleet Management Pty Limited*
SG Fleet Australia Pty Limited*
Fleet Care Services Pty Limited*
SG Fleet Salary Packaging Pty Limited*
Beta Dimensions Pty Limited*
SMB Car Sales Pty Limited*
SG Fleet NZ Limited
SG Fleet UK Limited
By entering into the deed, the Australian wholly-owned entities (denoted above by an asterisk (*)) have been
relieved from the requirement to prepare financial statements and Directors’ report under Class Order 98/1418
(as amended) issued by the Australian Securities and Investments Commission (‘ASIC’).
The above companies represent a ‘Closed Group’ for the purposes of the Class Order, and as there are no other
parties to the deed of cross guarantee that are controlled by SG Fleet Group Limited, they also represent the
‘Extended Closed Group’.
The statement of profit or loss and other comprehensive income and statement of financial position for the Closed
Group are the same as the Group and therefore have not been separately disclosed.
Annual Report 2015
65
Note 38. Events after the reporting period
Apart from the dividend declared as disclosed in note 26, no other matter or circumstance has arisen since
30 June 2015 that has significantly affected, or may significantly affect the Group’s operations, the results
of those operations, or the Group’s state of affairs in future financial years.
Note 39. Reconciliation of profit after income tax to net cash from operating activities
Consolidated
Year ended
30 Jun 2015
$’000
Period ended
30 Jun 2014
$’000
40,482
15,620
7,098
57
–
337
–
(61)
1,669
(278)
549
–
5,953
6,522
355
(3,581)
2,430
1,757
–
(430)
122
3,046
–
(5,044)
1,091
1,076
192
5,070
2,141
471
(1,131)
790
61,532
24,771
Profit after income tax expense for the year
Adjustments for:
Depreciation and amortisation
Impairment of intangibles
Finance costs – non-cash
Share-based payments
Bonus share issue
Leased motor vehicles – fair value increments
Change in operating assets and liabilities:
Decrease/(increase) in trade and other receivables
Decrease/(increase) in inventories
Decrease in deferred tax assets
Decrease in other operating assets
Increase in trade and other payables
Increase in provision for income tax
Increase in employee benefits provision
Decrease in other provisions
Increase in deferred income
Net cash from operating activities
66
SG Fleet Group Limited
Notes to the Financial Statements30 June 2015
Note 40. Earnings per share
Profit after income tax attributable to the owners of SG Fleet Group Limited
40,482
15,620
Consolidated
Year ended
30 Jun 2015
$’000
Period ended
30 Jun 2014
$’000
Weighted average number of ordinary shares used in
calculating basic earnings per share
Adjustments for calculation of diluted earnings per share:
Options over ordinary shares
Weighted average number of ordinary shares used in
calculating diluted earnings per share
Basic earnings per share
Diluted earnings per share
Number
Number
242,691,826
171,053,878
113,454
5,796,623
242,805,280
176,850,501
Cents
16.68
16.67
Cents
9.13
8.83
Note 41. Share-based payments
The Group has a share option plan to incentivise certain employees and Key Management Personnel. The share-
based payment expense for the year was $337,000 (2014: $122,000). The share option plan is subject to a service
condition and a performance condition. The performance condition is based on the compound annual growth rate
(‘CAGR’) of the Group’s earnings per share.
Set out below are summaries of options granted under the plan:
2015
Grant date
Expiry date
Exercise
price
Balance at
the start of
the year
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
04/03/2014
30/06/2018
$1.85
8,086,046
8,086,046
–
–
–
–
–
–
8,086,046
8,086,046
2014
Grant date
Expiry date
Exercise
price
Balance at
the start of
the period
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the period
04/03/2014
30/06/2018
$1.85
–
–
8,086,046
8,086,046
–
–
–
–
8,086,046
8,086,046
The weighted average remaining contractual life of options outstanding at the end of the financial period was two
years (2014: three years).
Annual Report 2015
67
Directors’ Declaration
In the Directors’ opinion:
• the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards,
the Corporations Regulations 2001 and other mandatory professional reporting requirements;
• the attached financial statements and notes comply with International Financial Reporting Standards as issued
by the International Accounting Standards Board as described in note 2 to the financial statements;
• the attached financial statements and notes give a true and fair view of the Group’s financial position as at
30 June 2015 and of its performance for the financial year ended on that date;
• there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable; and
• at the date of this declaration, there are reasonable grounds to believe that the members of the Extended Closed
Group 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 37 to the financial statements.
The Directors have been given the declarations required by section 295A of the Corporations Act 2001 from the
Chief Executive Officer and Chief Financial Officer.
Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations
Act 2001.
On behalf of the Directors
Andrew Reitzer
Chairman
Robbie Blau
Chief Executive Officer
17 August 2015
Sydney
68
SG Fleet Group Limited
ABCD
ABCD
Independent Auditor’s Report
Independent auditor’s report to the members of SG Fleet Group Limited
Independent auditor’s report to the members of SG Fleet Group Limited
Report on the financial report
Report on the financial report
We have audited the accompanying financial report of SG Fleet Group Limited (the Company), which
We have audited the accompanying financial report of SG Fleet Group Limited (the Company), which
comprises the consolidated statement of financial position as at 30 June 2015, and consolidated
comprises the consolidated statement of financial position as at 30 June 2015, and consolidated
statement of profit or loss and comprehensive income, consolidated statement of changes in equity
statement of profit or loss and comprehensive income, consolidated statement of changes in equity
and consolidated statement of cash flows for the year ended on that date, notes 1 to 41 comprising a
and consolidated statement of cash flows for the year ended on that date, notes 1 to 41 comprising a
summary of significant accounting policies and other explanatory information and the directors’
summary of significant accounting policies and other explanatory information and the directors’
declaration of the Group comprising the Company and the entities it controlled at the year’s end or
declaration of the Group comprising the Company and the entities it controlled at the year’s end or
from time to time during the financial year.
from time to time during the financial year.
Directors’ responsibility for the financial report
Directors’ responsibility for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act
true and fair view in accordance with Australian Accounting Standards and the Corporations Act
2001 and for such internal control as the directors determine is necessary to enable the preparation of
2001 and for such internal control as the directors determine is necessary to enable the preparation of
the financial report that is free from material misstatement, whether due to fraud or error. In note 2,
the financial report that is free from material misstatement, whether due to fraud or error. In note 2,
the directors also state, in accordance with Australian Accounting Standard AASB 101 Presentation
the directors also state, in accordance with Australian Accounting Standard AASB 101 Presentation
of Financial Statements, that the financial statements of the Group comply with International
of Financial Statements, that the financial statements of the Group comply with International
Financial Reporting Standards.
Financial Reporting Standards.
Auditor’s responsibility
Auditor’s responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted
Our responsibility is to express an opinion on the financial report based on our audit. We conducted
our audit in accordance with Australian Auditing Standards. These Auditing Standards require that
our audit in accordance with Australian Auditing Standards. These Auditing Standards require that
we comply with relevant ethical requirements relating to audit engagements and plan and perform the
we comply with relevant ethical requirements relating to audit engagements and plan and perform the
audit to obtain reasonable assurance whether the financial report is free from material misstatement.
audit to obtain reasonable assurance whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial report. The procedures selected depend on the auditor’s judgement, including the
in the financial report. The procedures selected depend on the auditor’s judgement, including the
assessment of the risks of material misstatement of the financial report, whether due to fraud or error.
assessment of the risks of material misstatement of the financial report, whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the entity’s
In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation of the financial report that gives a true and fair view in order to design audit procedures
preparation of the financial report that gives a true and fair view in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of
effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by the directors, as
accounting policies used and the reasonableness of accounting estimates made by the directors, as
well as evaluating the overall presentation of the financial report.
well as evaluating the overall presentation of the financial report.
We performed the procedures to assess whether in all material respects the financial report presents
We performed the procedures to assess whether in all material respects the financial report presents
fairly, in accordance with the Corporations Act 2001 and Australian Accounting Standards, a true
fairly, in accordance with the Corporations Act 2001 and Australian Accounting Standards, a true
and fair view which is consistent with our understanding of the Group’s financial position and of its
and fair view which is consistent with our understanding of the Group’s financial position and of its
performance.
performance.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
for our audit opinion.
63
63
KPMG, an Australian partnership and a member firm
of the KPMG network of independent member firms
KPMG, an Australian partnership and a member firm
affiliated with KPMG International Cooperative
of the KPMG network of independent member firms
(“KPMG International”), a Swiss entity.
affiliated with KPMG International Cooperative
(“KPMG International”), a Swiss entity.
Liability limited by a scheme
approved under Professional
Liability limited by a scheme
Standards Legislation.
approved under Professional
Standards Legislation.
Annual Report 2015
69
ABCD
Independent Auditor’s Report
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations
Act 2001.
Auditor’s opinion
In our opinion:
(a) the financial report of the Group is in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Group’s financial position as at 30 June 2015 and of
its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations
2001.
(b) the financial report also complies with International Financial Reporting Standards as
disclosed in note 2.
Report on the remuneration report
We have audited the Remuneration Report included in pages 9 to 19 of the directors’ report for the
year ended 30 June 2015. The directors of the Company are responsible for the preparation and
presentation of the remuneration report in accordance with Section 300A of the Corporations Act
2001. Our responsibility is to express an opinion on the remuneration report, based on our audit
conducted in accordance with auditing standards.
Auditor’s opinion
In our opinion, the remuneration report of SG Fleet Group Limited for the year ended 30 June 2015,
compiles with Section 300A of the Corporations Act 2001.
KPMG
Peter Russell
Partner
Sydney
17 August 2015
64
70
SG Fleet Group Limited
Shareholder Information
The shareholder information set out below was applicable as at 31 July 2015.
Distribution of equitable securities
Analysis of number of equitable security holders by size of holding:
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Holding less than a marketable parcel
Equity security holders
Twenty largest quoted equity security holders
Number of
holders of
ordinary shares
Number of
holders of
options over
ordinary shares
182
231
179
413
69
1,074
11
–
–
–
–
9
9
–
The names of the twenty largest security holders of quoted equity securities are listed below:
Bluefin Investments Limited
National Nominees Limited
Citicorp Nominees Pty Limited
BNP Paribas Noms Pty Ltd (DRP)
HSBC Custody Nominees (Australia) Limited
J P Morgan Nominees Australia Limited
Robert Pinkas Blau
RBC Investor Services Australia Nominees P/L (WAM Account)
RBC Investor Services Australia Nominees Pty Limited (PI Pooled A/C)
Kevin Victor Wundram
Pacific Custodians Pty Limited (Equity Plans Tst A/C)
Mr David John Fernandes
Invia Custodian Pty Limited (Best Superannuation P/L A/C)
Yogan Nagaratnam + Sheila Shanthy Nagaratnam (Cobragem Superfund A/C)
Andrew Brian Mulcaster + Helen Jane Mulcaster (Mulcaster Superfund A/C)
Australian Executor Trustees Limited (No 1 Account)
Ron Polkinghorne Super Fund Pty Ltd (Ron Polkinghorne S/Fund A/C)
Aust Executor Trustees Ltd (DS Capital Growth Fund)
HSBC Custody Nominees (Australia) Limited (NT-Comnwlth Super Corp A/C)
RBC Investor Services Australia Nominees Pty Limited (PISelect)
Ordinary shares
Number held
% of total
shares issued
131,044,373
54.00
14,425,047
13,968,050
11,046,241
8,705,329
8,130,513
6,756,425
4,937,995
3,508,422
1,863,840
1,646,330
1,630,860
1,450,383
1,197,925
1,006,255
980,664
931,920
794,262
765,667
631,823
5.94
5.76
4.55
3.59
3.35
2.78
2.03
1.45
0.77
0.68
0.67
0.60
0.49
0.41
0.40
0.38
0.33
0.32
0.26
215,422,324
88.76
Annual Report 2015
71
Shareholder Information
Unquoted equity securities
Options over ordinary shares issued
Substantial holders
Substantial holders in the Company are set out below:
Bluefin Investments Limited
Voting rights
The voting rights attached to ordinary shares are set out below:
Number
on issue
Number
of holders
8,086,046
9
Ordinary shares
Number held
% of total
shares issued
131,044,373
54.00
Ordinary shares
On a show of hands every member present at a meeting in person or by proxy, attorney or corporate representative
shall have one vote and upon a poll each share shall have one vote.
There are no other classes of equity securities.
Restricted securities
Class
Expiry date
Fully Paid Ordinary Shares
Earlier of the date on which the audited financial statements of the
Company for the financial year ending 30 June 2015 are released
and the date on which the escrowed shareholder ceases to be an
employee of the Company or its subsidiaries if his/her employment
is terminated under specified conditions
Fully Paid Ordinary Shares
Date on which the audited financial statements of the Company for
the financial year ending 30 June 2015 are released
Fully Paid Ordinary Shares
28 February 2017
Number
of shares
16,308,605
823,165
823,165
17,954,935
72
SG Fleet Group Limited
Auditor
KPMG
10 Shelley Street
Sydney NSW 2000
Stock exchange listing
SG Fleet Group Limited shares are listed on the
Australian Securities Exchange (ASX code: SGF)
Website
www.sgfleet.com
Corporate Governance Statement
The Corporate Governance Statement which was
approved on 17 August 2015 can be found at http://
investors.sgfleet.com/Investors/?page=Corporate-
Governance-Statement
Enquiries
investorenquiries@sgfleet.com
Business objectives and cash use
SG Fleet Group Limited has used cash and cash
equivalents held at the timing of listing, in a way
consistent with its stated business objectives.
Corporate Directory
Directors
Andrew Reitzer – Independent Non-Executive Chairman
Robbie Blau – Chief Executive Officer
Cheryl Bart AO – Independent Non-Executive Director
Graham Maloney – Independent Non-Executive Director
Peter Mountford – Non-Executive Director
Kevin Wundram – Alternate Director for Robbie Blau
and Chief Financial Officer
Colin Brown – Alternate Director for Peter Mountford
Company secretary
Sarah Anne Edwards
Notice of annual general meeting
The details of the annual general meeting of
SG Fleet Group Limited are:
Bridge Room, Level 1
Intercontinental Hotel
117 Macquarie Street
Sydney NSW 2000
3:00 PM on Wednesday 14 October 2015
Registered office
Level 2, Building 3
20 Bridge Street
Pymble NSW 2073
Telephone: +61 2 9494 1000
Facsimile: +61 2 9899 9233
Principal place of business
Level 2, Building 3
20 Bridge Street
Pymble NSW 2073
Telephone: +61 2 9494 1000
Facsimile: +61 2 9899 9233
E-mail: globalenquiries@sgfleet.com
Share register
The Registrar
Computershare Investor Services Pty Ltd
GPO Box 2975, Melbourne Victoria 3001
Telephone: +61 3 9415 4000 or 1300 850 505
Facsimile: +61 3 9473 2500 or 1800 783 447
E-mail: web.queries@computershare.com.au
Website: www.investorcentre.com
Annual Report 2015
73