ASX RELEASE
30 August 2019
Appendix 4E and Annual Report
The Directors of Site Group International Limited (“Site”) are pleased to announce the release of:
• Appendix 4E – Preliminary Final Report for the year ended 30 June 2019: and
• 2019 Annual Report
The attached annual report contains details of the achievements of the group over the last
financial year.
--- END ---
Media and Investors
Vernon Wills
Managing Director and CEO
+61 (7) 3114 5188
vern.wills@site.edu.au
Craig Dawson
CFO
+61 (7) 3114 5188
craig.dawson@site.edu.au
Principal & Registered Office: Level 4, 488 Queen St, Brisbane QLD 4000
t. +61 7 3114 5188
ABN: 73 003 201 910
(ASX: SIT)
www.site.edu.au
Appendix 4E
Preliminary Final report
________________________________________________________________________
Appendix 4E
Preliminary Final Report to the Australian
Stock Exchange
Name of Entity
ABN
Financial Year Ended
Previous Corresponding
Reporting Period
Site Group International Limited
73 003 201 910
30 June 2019
30 June 2018
Results for Announcement to the Market
$’000
Percentage
increase
/(decrease) over
previous
corresponding
period
Revenue
Profit / (loss) after tax attributable to members
30,913
4% increase
(4,742) 22% Decrease of
loss
Net profit / (loss) for the period attributable to members
(4,742) 22% Decrease of
Dividends (distributions)
Final Dividend
Interim Dividend
Record date for determining entitlements to the
dividends (if any)
Amount per security
0.0 cents
0.0 cents
loss
Franked amount per security
0.0 cents
0.0 cents
Not applicable
________________________________________________________________________
Appendix 4E 1
Dividends
Date the dividend is payable
Record date to determine entitlement to the
dividend
Amount per security
Total dividend
Amount per security of foreign sourced
dividend or distribution
Details of any dividend reinvestment plans in
operation
The last date for receipt of an election notice
for participation in any dividend reinvestment
plans
NTA Backing
Net tangible asset backing per ordinary
security
Not applicable
Current Period
Previous
corresponding
period
(0.62) cents
(0.001) cents
Other Significant Information Needed by an Investor to Make an
Informed Assessment of the Entity’s Financial Performance and
Financial Position
Refer attached annual report
________________________________________________________________________
Appendix 4E 2
Appendix 4E
Preliminary Final report
________________________________________________________________________
Commentary on the Results for the Period
The earnings per security:
The current year result is a loss per share of (0.69) cents as compared to the prior year loss per
share of (0.92) cents.
Results for Site Group International Limited show a revenue line of $30.9M with an EBITDA loss of
the continuing operation of $3.2M. The results continue to be negatively impacted by the distraction
of the regulatory action and legal cases currently underway both in terms of professional fees
incurred and also the substantial commitment of management time and resources.
Despite this and in line with the strategic direction, Site has made progress in its studies as to
decoupling the International and Domestic training businesses as well as progress in determining
potential optimisation of its Clark leasehold property.
For further review of results please refer to the Directors report on page 8 of the attached annual
report.
Returns to shareholders including distributions and buy backs:
Not applicable
Significant features of operating performance:
Refer to the Directors’ Report
The results of segments that are significant to an understanding of the
business as a whole:
Refer to Note 2 to the Accounts (Operating Segments)
Discussion of trends in performance:
Refer to the Directors’ Report
Any other factor which has affected the results in the period or which are
likely to affect results in the future, including those where the effect could
not be quantified:
Refer to the Directors’ Report
________________________________________________________________________
Appendix 4E 3
Appendix 4E
Preliminary Final report
________________________________________________________________________
Audit/Review Status
This report is based on accounts to which one of the following applies:
(Tick one)
The accounts have been audited
The accounts are in the process of
being audited or subject to review
If the accounts have not yet been audited or subject to review and are likely
to be subject to dispute or qualification, a description of the likely dispute
or qualification:
The accounts have been subject to
review
The accounts have not yet been audited
or reviewed
Not Applicable
If the accounts have been audited or subject to review and are subject to
dispute or qualification, a description of the dispute or qualification:
Not Applicable
Attachments Forming Part of Appendix 4E
Attachment # Details
1
Audited financial statements 30 June 2019
Signed By (Director/Company Secretary)
Print Name
Date
Vernon Wills
30 August 2019
________________________________________________________________________
Appendix 4E 4
Site Group International Limited
and Controlled Entities
ABN 73 003 201 910
Annual report – 30 June 2019
Table of Contents
Annual General Meeting ....................................................................................................................... 3
Managing Director and CEO Letter ..................................................................................................... 3
Corporate Directory .............................................................................................................................. 5
Directors’ Report ................................................................................................................................... 8
Principal Activity ................................................................................................................................... 9
Operating and Financial Review ........................................................................................................ 10
Corporate Governance Statement ..................................................................................................... 27
Auditor’s Independence Declaration ................................................................................................ 34
Statement of Comprehensive Income ............................................................................................... 35
Statement of Financial Position ........................................................................................................ 36
Statement of Changes in Equity ........................................................................................................ 37
Statement of Cash Flows ................................................................................................................... 38
Notes to the Financial Statements for the Year Ended 30 June 2019 ........................................... 39
Directors' Declaration ......................................................................................................................... 84
Independent Auditor’s Report ........................................................................................................... 85
Shareholder Information .................................................................................................................... 89
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 2 of 92
Annual General Meeting
The Annual General Meeting of the Company will be held at
Time:
11:00am
Date:
Thursday, 28 November 2019
Location:
488 Queen Street,
Brisbane QLD 4000.
Managing Director and CEO Letter
Results for Site Group International Limited as released in July show a revenue line of $30.9M with an
EBITDA loss of the continuing operation of $3.2M. The results continue to be negatively impacted by
the distraction of the regulatory action and legal cases currently underway both in terms of professional
fees incurred and also the substantial commitment of management time and resources.
Despite this and inline with the strategic direction, Site has made progress in its studies as to decoupling
the International and Domestic training businesses as well as progress in determining potential
optimisation of its Clark leasehold property.
Site recently announced the appointment of Ms Nina Cordero as President and CEO of Site Group
Holdings, the Site subsidiary that holds the Clark lease. Ms Cordero is working closely with Directors
Nick Alcantara and Vern Wills on the completion of feasibility studies with Urban renewal specialist
Palafox as well as the development of a a business model, financial model and identification of strategic
partners for any future optimisation plan for Sites 30 Hectare leasehold property in Clark, Philippines.
The Group continues to build internationally, with new opportunities evolving in competency focussed
programs predominantly with existing customers targeted at workforce needs in a number of countries,
both existing and new markets such as Singapore, Indonesia and Bahrain. Site’s nationalisation of
workforce programs continue to have great effect in countries such as PNG, Myanmar, Philippines and
Saudi Arabia.
Site expects to establish new markets, particularly around its competency framework capability and
Chemical and Energy Industries, over the next 12 months.
In Australia, Site continues to investigate options for the optimisation of it services. Site Skills Group
(SSG) received over 27,000 enrolments across 48,000 units of competency, with the majority of those
programs being delivered under pre-qualified arrangements with some of Australia`s largest and most
significant projects and corporations. SSG is pleased to have the continued confidence of these
companies, many of whom conduct independent audit and analysis activities before pre-qualifying
SSG.
SSG student completion rates remain well above sector average at approximately 90%, with overall
student satisfaction rate remaining at approximately 90%.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 3 of 92
Regulatory Actions
There is a prevailing view amongst the Vocational Education and Training sector that its regulator, the
Australian Skills Quality Authority (ASQA), is continuing with a sledgehammer approach to private
sector RTOs. Since January 2018, ASQA has cancelled over 400 private Registered Training
Organisations with many feeling that they have had inconsistent treatment by the regulatory authority,
particularly in comparison to the regulators treatment of non-private RTOs, who seem to be given extra
opportunity to rectify any non-compliances.
As disclosed in the market update of 31 July 2019, Site remains in dispute with the (ASQA) in the
Administrative Appeals Tribunal (AAT) and Federal Court, and in the Federal Court with the pending
ACCC litigation. This action appears likely to continue for some time, potentially into the second half of
2020.
In July 2019, at the initial AAT hearing for Site Skills Group (SSG), the ongoing unconditional stay of
SSG operations was confirmed. The substantive issue of SSG operations remains before the AAT.
Trial dates have now been established for the commencement of Productivity Partners proceedings
brought by the ACCC set down for June 2020.
Site remains confident in its position.
I would like to thank our ongoing directors Peter Jones (Chairman of Site Group International Limited)
and Nicasio Alcantara (Chairman of Site’s International Operations), CFO and Company Secretary
Craig Dawson, all management and staff and equally all shareholders for their ongoing support.
Vernon Wills
Managing Director and CEO
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 4 of 92
Corporate Directory
Directors
Company Secretary
Chief Executive Officer
Principal registered office in Australia
Principal place of business
Share registry
Auditor
Solicitors
Bankers
Peter Jones (Chairman)
Vernon Wills
Nicasio Alcantara
Craig Dawson
Vernon Wills
Site Group International Limited
Level 4, 488 Queen Street
Brisbane Qld 4000
Telephone: +61 7 3114 5188
Site Group International Limited
Level 4, 488 Queen Street
Brisbane Qld 4000
Telephone: +61 7 3114 5188
Computershare Investor Services Pty Limited
Level 1, 200 Mary Street
Brisbane QLD 4000, Australia
Telephone: +61 7 3237 2100
Pitcher Partners
Level 38, 345 Queen Street
Brisbane QLD 4000, Australia
Telephone: +61 7 3222 8444
Hopgood Ganim
Level 8, 1 Eagle Street
Brisbane Qld 4000
Telephone: +61 7 3024 0000
National Australia Bank
Cnr. Adelaide and Creek Streets
Brisbane QLD 4000
Westpac Banking Corporation
45 Adelaide Street
Fremantle WA 6160
Stock exchange listing
Site Group International Limited shares are listed
on the Australian Securities Exchange (code: SIT)
Web site address
www.site.edu.au
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 5 of 92
[This page intentionally blank]
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 6 of 92
SITE GROUP INTERNATIONAL LIMITED
AND CONTROLLED ENTITIES
ABN: 73 003 201 910
Financial Report for the Year Ended
30 June 2019
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 7 of 92
Directors’ Report
Your Directors submit herewith the financial report of Site Group International Limited (the Company)
and its controlled entities (the Group) for the year ended 30 June 2019.
Directors
The directors in office at any time during or since the end of the financial year, together with their
qualifications and experience are:
Vernon Wills – Managing Director and CEO
Vern established Site to provide skills training and workforce planning solutions by initially developing
a 300,000m2 Philippines facility at the Expo Filipino site at Clark Freeport, after he identified a market
gap in Australian training providers delivering international training for industry and major projects.
Prior to Site, Vern has had an extensive career in investment and finance as well as building start up
and early stage companies such as Go Talk Ltd and Dark Blue Sea Ltd. Additionally he serves as a
Director of Eumundi Group Ltd (since September 2004) and was previously a director of the Greg
Norman Golf Foundation, CITEC, and Deputy Chair of the Queensland Government’s Major Sports
Facilities.
Nicasio Alcantara BA, MBA – Non-Executive Director
Mr Alcantara was appointed Director of the company on 12 October 2010 and has been a director of
Site Group Holdings Pty Ltd since June 2009. Mr Alcantara is an experienced director with over 40
years’ experience in both public and private companies and his diverse industry experience includes
manufacturing, banking & finance, property, information technology, agriculture and power & energy.
Mr Alcantara is currently a director of Alsons Corporation, Alsons Development & Investment
Corporation, C. Alcantara & Sons Inc., Lima Land Inc., Sarangani Agricultural Co. Inc, Seafront
Resources Corporation (appointed 1995), the Philodrill Corporation (appointed 1991), Indophil
Resources NL (appointed 29 December 2011) and BDO Private Bank Inc.
Mr Alcantara has also previously been Chairman and President of Alsons Consolidated Resources Inc.,
Iligan Cement Corporation, Alsons Cement Corporation, Northern Mindanao Power Corporation and
Refractories Corporation of the Philippines. He was also previously Chairman and Chief Executive
Officer of Petron Corporation and a director of Bank One Savings and Bancasia Capital Corporation.
Peter Jones ACA – Chairman and Non-Executive Director - Appointed director 29 May 2017
and appointed Chairman 30 June 2019
Mr. Jones is a Chartered Accountant and was formerly a founding director of Investor Group Limited
(now Crowe Horwath), a listed financial services company.
Mr Jones has a strong track record as a successful investor in public and private companies. He is
currently also a director of ASX listed Biotech Capital Limited (appointed 4 August 2015).
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 8 of 92
Directors’ Report continued
Company Secretary
Craig Dawson BCom, ACA
Mr Dawson is the Chief Financial Officer of the Group. He brings extensive financial management
experience gained in ASX listed entities with both local and international operations in a variety of
industries including media, financial services, gaming and wagering and most recently in the rapidly
growing online sector.
Most notably, Mr Dawson was CFO of Wotif.com for over 4 years as the group experienced rapid
earnings growth, greatly extended its geographical reach and expanded its brands and products
through both organic and acquisition growth. Prior to that, Mr Dawson was Queensland General
Manager – Corporate Services at Tatts Group Limited heading up the finance and administration
divisions of Tatts Queensland operations.
Mr Dawson holds a Bachelor of Commerce and is a Chartered Accountant.
Committee membership
As at the date of this report, the company had an Audit and Risk committee and a Nomination and
Remuneration committee of the board of directors. Members acting on the committees of the board
during the year and up to the date of this report were:
Audit and Risk Committee (AC)
• Peter Jones (c)
• Nicasio Alcantara
Mr Jones is a Chartered Accountants and Mr Alcantara has extensive corporate experience and is
qualified to serve on this Committee.
Nomination and Remuneration Committee (NRC)
• Peter Jones (c)
• Nicasio Alcantara
(c) Designates the chairman of the committee.
Meetings of Committees
Vernon Wills
Board
No.
5
Attended
No.
5
Nicasio Alcantara
5
5
AC
No.
2
2
Attended
No.
2*
2
NRC
No.
1
1
Attended
No.
1**
1
Peter Jones
* ex officio attendance
** The CEO attended part of the Nomination and Remuneration Committee meeting before excluding himself from the meeting.
2
5
5
1
1
2
All directors were eligible to attend all meetings held.
Principal activity
The principal activity of the company during the period was the provision of training and education
services in Australia and Internationally. The company is delivering workforce solutions across a variety
of industries to both retail and corporate clients. There has been no significant change in the principal
activities of the consolidated entity during the period.
The company has adopted expansion plans via both organic growth and through prudent acquisition
activity with a view to diversifying funding sources and diversifying course and program offerings.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 9 of 92
Directors’ Report continued
Operating and financial review
Group
Site business growth in revenue is demonstrated in the below graph. Total revenue from operations for
the year ended 30 June 2019 was up 2% to $30,913,290 (2018: $30,306,134).
Yearly Revenue
s
n
o
i
l
l
i
M
35
30
25
20
15
10
5
-
Jun 11
Jun 12
Jun-13
Jun-14
Jun-15
Jun-16
Jun-17
Jun-18
Jun-19
Following the initial announcement in June 2018 to separate the responsibility for the Domestic and
International business, the group continues to investigate growth and utilisation options of its leasehold
in Clark Freeport Zone (“Clark”) Philippines. The Clark precinct is experiencing a significant growth
phase with the construction of a new airport terminal as well as the long anticipated Clark to Manila rail
due for completion in 2023.
In line with the appointment of Mr Nicasio Alcantara as Chairman of the international subsidiaries,
interests associated with Mr Alcantara have provided a financing facility of $US4m to enable the
continuation of the international growth strategy and provide working capital. Repayment of funds drawn
under the facility will be via cash or equity to be issued at the last issue price of 4 cents per share subject
to approval of shareholders. A total of US$2.9 million has been drawn to 30 June 2019.
Projected increases in revenues are expected to continue internationally from the Philippines, the
Kingdom of Saudi Arabia, Papua New Guinea and Myanmar as well as new project opportunities in the
Middle East which are expected to positively impact on 2020.
Revenue contribution and activity by each segment is illustrated in the two charts below. This highlights
the growing revenue from the international business.
Tertiary
Education,
$2,614,754 ,
8%
30 June 2019
Tertiary
Education,
$1,423,013 ,
5%
30 June 2018
Site Skills
Training - Int'l,
$12,658,371 ,
40%
Energy
Services,
$3,639,017 ,
11%
Site Skiils
Training -
Domestic,
$12,866,083 ,
41%
Site Skills
Training - Int'l,
$10,789,008 ,
36%
Energy
Services,
$3,781,713 ,
12%
Site Skiils
Training -
Domestic,
$14,284,041 ,
47%
Gross Revenue by Segment June 2019 versus June 2018 (excludes eliminations)
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 10 of 92
Directors’ Report continued
Operating and financial review continued
Site remains in dispute with the Australian Skills Quality Authority (ASQA) in the Administrative Appeals
Tribunal (AAT) and Federal Court, and in the Federal Court with the pending Australian Competition
and Consumer Commission (ACCC) litigation. These actions appear likely to continue for some time,
potentially into the second half of 2020.
In July 2019, at the initial stage of the AAT hearing for Site Skills Group (SSG), the ongoing
unconditional stay of the ASQA renewal of registration rejection decision was confirmed and has
remained in place since 21 May 2018. The substantive issue of SSG operations remains before the
AAT.
Trial dates have not yet been established for the commencement of Productivity Partners proceedings
brought by the ACCC. The ACCC has commenced civil proceedings against Site, Productivity Partners
and two former executives in relation to enrolment practices of the college in 2015.
Site continues to expend significant operational resources ensuring that SSG remains compliant to
achieve the favourable outcome in the AAT and focus on ensuring the best interests of clients and
students. SSG continues to be impacted with customers postponing training until the appeal process is
finalised.
Consistent with the 30 June 2018 annual report, the closure of the Productivity Partners (PP) business
and closure of the VET FEE-HELP related campuses has meant that this business has been reported
as a discontinued operation in the result to 30 June 2019 and comparative period. Following review of
the historical taxation treatment for the revenue derived by the PP business, management lodged
amended income tax returns for the 2015, 2016 and 2017 income tax years resulting in income tax
refund for $1,688,960 being received in January 2019.
For the year ended 30 June 2019, Site Group International Limited reported a loss after tax from
continuing operations of $5,082,800 compared to an after tax loss of $9,547,913 in the previous
corresponding period.
For comparability with the trading result in the prior period, the below table shows the result for the
Group including the discontinued operations over the last 4 years.
Revenue
Net profit / (loss)
add back
Depreciation and amortisation
Interest paid
Income tax (benefit) / expense
deduct
Interest income
EBITDA*
Non recurring items**
2019
$
30,913,290
30-Jun
2018
$
Change 19-18
%
30-Jun
2017
$
Change 18-17
%
30-Jun
2016
$
Change 17-16
%
30,306,134
2% 29,213,400
4% 25,406,177
( 4,742,968)
( 6,042,212)
( 22%)
( 50,466,491)
( 88%)
9,404,816
1,413,716
415,460
( 1,514,919)
2,033,252
55,744
247,641
( 30%)
645%
-
2,355,412
307,304
( 1,025,209)
( 14%)
( 82%)
( 124%)
2,855,346
263,047
782,430
15%
-
( 18%)
17%
( 231%)
66,183
16,197
309%
16,930
( 4%)
23,227
( 27%)
( 4,494,894)
( 3,721,772)
21% ( 48,845,914)
( 92%)
13,282,412
-
Impairment of intangibles
Write down / (reversal of write down) of DET debtor
Write back of contingent consideration
-
-
-
3,797,413
( 4,990,113)
-
23,570,460
33,944,396
-
EBITDA before non recurring items
( 4,494,894)
( 4,914,472)
( 9%)
8,668,942
Operating cash inflow /(outflow)
( 2,680,639)
( 727,824)
-
( 93,722)
3,177,175
-
( 3,375,136)
13,084,451
( 4,835,274)
-
-
( 34%)
-
* Earnings before interest, tax, depreciation and amortisation (EBITDA) is a non-IFRS measure which is readily calculated and
has broad acceptance and is used by regular users of published financial statements as a proxy for overall operating
performance. EBITDA is not an audited number.
**This a non-IFRS measure and is not an audited number.
Table 1 Financial Summary
The earnings before interest, taxes, depreciation and amortisation (EBITDA) was a loss of $4,494,894
compared to a loss of $4,914,472 in the prior corresponding period.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 11 of 92
Directors’ Report continued
Operating and financial review continued
Site Skills Training - Domestic
Site Skills Training (SST) is an Australian Registered Training Organisation with six large training
facilities across Australia, in Western Australia, Northern Territory and Queensland. These Australian
facilities with a combined footprint of approximately 33,500sqm have become hubs for some of
Australia’s largest projects in Mining, Construction and Oil and Gas including; Curtis Island Coal Seam
Gas (CSG) to Liquefied Natural Gas (LNG) projects; Western Australia Northwest Shelf LNG projects;
and Darwin Onshore and Offshore LNG projects; and effectively most major mine project sites across
Western Australia, Northern Territory and Queensland.
The Australian operations have been hindered primarily by ongoing regulatory uncertainty between
SSG and the ASQA. While SSG revenue has been negatively impacted, with a year-on-year reduction
of 10% to $12,866,083 from $14,284,041 in the previous period, primarily as a result of contracts
suspended or missed due to the regulatory uncertainty, SSG continues to receive exceptional customer
engagement, satisfaction and completion rates amongst individual and corporate clients which all
outperform industry targets.
SST has invested substantially in compliance resources and systems over the past 36 months and Site
has full confidence in the independent executive and management team to continue to deliver above
and beyond the expectations of its tens of thousands of students and hundreds of corporate clients
across high risk and nationally critical industries.
EBITDA was a loss of $1,728,678 compared to an EBITDA loss of $189,964 in the previous year
reflecting the lower revenue but also the additional compliance and legal costs incurred within this
division.
In addition to its corporate customers, SST delivers training to individuals using Western Australia,
Queensland and Northern Territory subsidised training regimes. In Queensland, Vocational Education
and Training (VET) in Schools students has expanded and will provide further growth in the next
financial year.
SST continues to invest in its systems and delivery platforms including launching a new transactional
website in July 2019.
Site Skills Training – International
Site Skills Training – International division provides training and competency assurance services to
organisations and governments in countries where local workforces require additional skills to meet
global standards. The segment, based at Site's major training facility in Clark Freeport Zone near Manila
in the Philippines, delivered a 17% increase in revenue to $12,658,371 in the 12 months to June 2019,
compared with $10,789,008 in the prior year. EBITDA was $682,394 compared with an EBITDA of
$698,936 in the prior year.
To date SST International has provided education and training services to countries including the
Philippines, PNG, Myanmar, Saudi Arabia, United Kingdom, China, Singapore, Malaysia and has
delivered services to governments and companies in locations including Timor-Leste, UAE, Azerbaijan,
Africa and others.
The Clark operations continue to provide the platform for our International expansion with existing
customers OceanaGold, FieldCore (a GE Company), Orica, Clough and Shell Brunei receiving regular
services. Additionally, Site WorkReady is increasing the provision of skilled trades people for markets
in Australia, New Zealand and the Africa`s.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 12 of 92
Directors’ Report continued
Operating and financial review continued
The National Construction Training Center (NCTC) in Nairiyah has been operating since September
2017 servicing the training needs of construction companies across the Kingdom of Saudi Arabia. The
College is currently operating at capacity of 600 students and well in front of trainee projections to meet
the 1,800 trainees contracted with another one year to run on the contract. Therefore, revenue from this
contract will be higher than anticipated and reported previously.
With over 1,000 graduates entering employment, NCTC output aligns well with the Kingdom’s Vision
2030. Feedback from employers is very positive and with new mega projects announced in the Eastern
Province where NCTC is located, the future demand for skilled graduates in the trades serviced by
NCTC is very high.
Site and Saudi partner AbdulAli Al Ajmi Company recently developed five Training Unit Improvement
Plans for five Saudi Arabian operated Vocational Schools and Colleges across the Kingdom. These
plans form the basis of an upcoming tender for the 3 Year Phase 2 projects implementing the plans.
Energy Services
The Energy services segment incorporating the Wild Geese International business in Perth and the
internationally based Site Group International Energy division (“SGI”) provides specialist training
services to the oil and gas industry including workforce design and identification, skills training and
competency assessment and assurance.
Revenue for the 12 months for the business fell slightly to $3,639,017 (2018: $3,781,713) with an
EBITDA of $211,651 (2018: EBITDA loss of $4,600,696).
Wild Geese International’s involvement with the Queensland Natural Gas Exploration and Production
Industry forum for the delivery of Queensland wide Industry Safety Inductions has provided services to
growing numbers of contractor and operator companies in Queensland.
The Site Group International Energy division’s Singapore and Malaysian operation continue to develop
their relationship and delivery of services in both Myanmar and PNG.
In Myanmar, ongoing delivery with in-country partners, Uniteam will see 31 PTTEP (the Thai national
petroleum exploration and production company) trainee technicians complete their training end of
August 19. This is the fifth group to be trained at the centre, a total of 200 successfully trained
technicians over the last 5 years. A further proposal has been submitted to global energy leader, Total,
for the training and development of their next batch of technicians through the Myanmar facility.
In PNG the commissioning of the Safe Live Process Plant (SLPP) is complete with final payment being
received for the SLPP from Kumul Petroleum. The training facility in Port Moresby is now expected to
benefit with an inflow of additional candidates to be trained in the 12-month Competence Based Junior
Technician program for the major Oil and Gas players as part of their National Workforce Development
commitment in PNG over the next 5 years. There has already been a significant increase in enrolments
by Industry training PNG nationals as technicians for the future with potentially over 100 new enrolments
in the program in 2020.
Site continues to investigate expansion of its SLPP and technician development plan in Singapore,
Bahrain and KSA as new opportunities arise. This is largely fuelled by a rapidly ageing workforce in the
industry, a significant investment into new projects around the world and a push by many countries for
a workforce nationalisation training agenda.
In addition a new contract was completed during the year with FieldCore, a GE Company, for the
development of their Global Competence Framework, comprising job competence profiles, job task
profiles, performance and assessment criteria, covering their global technical workforce including the
Africa, Asia/ Australia, Europe, North and South America continents. FieldCore is the field technical
services company for GE Power globally. The project covers a target workforce of over 10,000 technical
personnel including technicians, supervisors and management levels working in Power Services, Aero,
Oil and Gas, Renewables sectors.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 13 of 92
Directors’ Report continued
Operating and financial review continued
Tertiary Education
This segment provides tertiary education for international students seeking to develop careers in a
range of different disciplines. Students can choose from a range of diploma and certificate level courses
in Australia.
This division reported an increase in revenue of 84% to $2,614,754 in 2019, up from $1,423,013 in
2018. EBITDA improved to a positive $110,138 compared to an EBITDA loss of $243,958 in 2018, as
the scale of the business improves on the back of increased student number and enrolments
International student numbers studying in Australia continue to grow with over 280 current enrolments
in CRICOS registered courses. Future revenues are expected to continue to grow during the 2020
financial year as international students take the opportunity to study engineering and manufacturing
technology courses with Site Institute. Export market networks have been established for receiving
inbound students from countries across Asia, Americas and Europe, with the CRICOS division now
training students from countries including Argentina, Brazil, Chile, Colombia, Mexico, Peru and South
Korea.
In addition, TESOL Asia is a training and industry focussed organisation for Teachers in the English as
a Second Language (ESL) sector. It provides access to training, consulting, industry conferences and
academic journals around the world. Teaching English to Speakers of Other Languages (TESOL)
focusses on bringing English language acquisition academics together with professional teachers to
support and develop the industry globally. The investment in a range of TESOL courses and
conferences, and a number of strategic alliances are expected to further grow revenues with China a
key market.
Cash position
At 30 June 2019, the Company had net current asset deficiency of $1,767,400. As a consequence of
the impairment taken in the previous financial year, no amount has been reflected in the balance
sheet for the receivable ($20,977,645) due from the Commonwealth Government Department of
Education and Training (DET), even though the group maintains the position that it is entitled to the
funds. The Company has also entered into a financing facility with Punta Properties for $US4,000,000
to support the ongoing cash requirements of the business, of which $US2,9,000,000 has been drawn
down during the year to fund the remaining shortfall in net current assets described above. The loan
terms, as set out in note 17, will not result in a cash outflow from the Group in settlement of the loan
unless there is a significant cash inflow to fund such settlement. At 30 June 2019, the Company had
cash reserves of $606,148 and had reduced the current interest bearing debt to $142,519.
Risks
Risk management is overseen by the Audit and Risk Committee for the Group via the maintenance and
review of a risk register.
The following sets out a summary of some of the key risks relevant to the Company and its operations:
Risk
Details
Regulatory risk
The Group operates in a highly regulated market and the Group is regulated by
the Australian Federal and State Governments and the Philippine Government.
Failure to meet regulatory requirements may impact materially on the business.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 14 of 92
Risk
Details
Financing
Sovereign risk
The ability to implement its business strategy may be dependent upon the
Group’s capacity to raise additional capital. There is a risk that the Group may
not be able to secure such funding on satisfactory terms or at all.
The Group has significant operations in the Philippines. Those operations are
potentially subject to a degree of political risk and civil disobedience, although
the location of Clark Education City within the Clark Freeport Zone helps
mitigate such risks.
Cultural unrest
Any cultural unrest or perceived cultural unrest in the location of the campuses
may result in decreased client interest.
Competition
The market for education services in Australia and worldwide is highly
competitive and the group is likely to encounter strong competition from other
entities as well as other countries for training and education.
Industry downturn The industries to which the Group provides services may be affected by factors
outside the Group’s control.
Limited operating
history
Site’s business model is relatively new, and Site is yet to generate recurring
profits from its group activities. The Group will be subject to all of the business
risks and uncertainties associated with any developing business enterprise.
Material contracts The Group has entered into various contracts which are important to the future
of the Group. Any failure by counterparties to perform their job, or obligations
could have an adverse effect on the Group.
CDC lease
The Group has entered a long term lease with Clark Development Corporation
(CDC). There are a number of circumstances in which the CDC lease may be
terminated (subject to compliance with provisions enabling certain breaches to
be remedied) by CDC in which case Site does not have any rights to
compensation or reimbursement for funds expended on the leased land,
improvements and moveables on the leased property pass to CDC on
termination. Such termination may occur where Site has breached a provision
of the CDC lease or where there is an insolvency event. The CDC lease may
also be terminated in the event of any governmental expropriation of the
leased property. In the event that the CDC lease was terminated, Site would no
longer be in a position to operate its Philippines facility which would have
significant impact on the Group and the Group’s ongoing operations.
Currency
Some of Site’s revenue streams and expenses are denominated in currencies
other than the Australian Dollar. It is possible that foreign exchange rates
could move in a manner which would be unfavourable to the Company.
Large holdings by
some
shareholders
The two most significant existing shareholders (and their associates) have
combined holdings of approximately 30% of the shares which may impact on
liquidity in the public market for the sale of shares which may adversely affect
the market price.
Key employees
A small number of key employees are responsible for the day to day and
strategic management of the Group. The Company has sought to mitigate the
risk associated with this structure through entering service and employment
agreements.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 15 of 92
Risk
Details
Natural
catastrophe
Foreign
judgements
Material
arrangements
Geographic
concentration
2020 Outlook
The Philippines has experienced a number of major natural catastrophes over
the years, including typhoons, drought, volcanic eruption and earthquakes.
There can be no assurance that the occurrence of such natural catastrophes
will not materially disrupt the Group’s operations.
Whilst there are procedures for recognising foreign laws and judgements in the
Philippines, the Philippine courts may reject the applicability of foreign law or
judgment when the foreign law, judgment or contract is contrary to a sound and
established public policy of the forum. Additionally, Philippine prohibitive laws
concerning persons, their acts or property, and those which have for their
object public order, public policy and good customs shall not be rendered
ineffective by laws or judgments promulgated, or by determinations or
conventions agreed upon in a foreign country. Accordingly, the enforcement of
rights of the Group within the Philippines with respect to foreign judgments and
laws may be adversely affected by observance of Philippine procedural laws.
The Group has and expects to continue to enter into arrangements which are
important to the future of the Group. It may be the case that these
arrangements are non-binding and therefore unenforceable. The Group is also
reliant upon third parties maintaining appropriate qualifications and
accreditations and to the extent that these are not maintained, there may be an
adverse impact on the Group.
The Group’s expansion plans include the Philippines, Western Australia,
Northern Territory and Queensland as well as potentially other national and
international jurisdictions. If there are circumstances which impact negatively
on these jurisdictions, this may adversely affect the Group’s continuing
operations.
While Site continues to investigate options for the optimisation of its Australian services, as the company
looks at its strategic direction, it is clear the Board believe the substantial future and growth for Site is
in its international segments.
The recent contract wins demonstrate the growth opportunities for Site in its international segments.
These are expected to continue into FY20, as the group focuses on the expansion and optimisation
opportunities across its international business and assets.
In several announcements over the last 12 months, Site has identified the 30-hectare leasehold at Clark
having potential for increased utilisation and optimisation. There has been a new master plan of Clark
prepared by world-renowned architect, master planner and urban renewal specialists, Palafox for the
Philippine government agency Clark Development Corporation which envisages a major urban renewal
plan for the Clark precinct including Site’s facility.
The leasehold land held by Site’s wholly owned subsidiary Site Group Holdings (SGH) is currently
approved as a mixed-use educational campus and related training facilities with the ability to sublease
for mixed use purposes. SGH recently appointed Palafox to develop a full concept plan for the facility.
This development work is ongoing.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 16 of 92
Directors’ Report continued
Directors’ shareholdings as of the date of this report
Director
Vernon Wills
Peter Jones
Nicasio Alcantara
Shares
124,395,630
56,819,466
9,371,325
Significant changes in state of affairs
During the year the group was involved in the following significant transactions:
Capital Management
•
•
In March 2019 the company conducted an issue of new shares under the employee share loan
plan issuing 7,700,000 to existing staff members. These shares are escrowed and have a loan
of 4 cents per share payable before they are released from escrow. Further information on this
arrangement is provided under the share options heading below.
In March 2019 the company completed a buyback of shares issued under the employee share
plan with 4,795,000 shares bought back for nominal consideration of $18.
After balance date events
Capital Management
•
In August 2019 the company successfully completed the issue of 93,750,000 shares under a
private placement at 4 cents per share to raise $3,750,000.
Other than as noted elsewhere in this report there has been no other significant events post balance
date.
Dividends paid
There have been no dividends paid.
Environmental issues
The Group’s operations are not regulated by any significant environment regulation under a law of the
Commonwealth or of a State or Territory.
Share options
As at the date of this report there were no unissued shares under options.
In November 2011 the Shareholders approved the establishment of an Employee Share Plan that would
enable employees, directors and eligible associates to subscribe for shares in the Company. Under the
terms of the plan an eligible person is offered shares in the Company at a price determined by the board
with a corresponding interest free loan to assist the person to subscribe for the shares. The shares are
escrowed in two tranches with 50% being escrowed for 12 months and 50% being escrowed for 24
months. Subsequent to these minimum restriction periods, the shares are available for release from
escrow on the repayment of the loan, and subject to continuation of employment (or acting as an
associate or director) at the time of repayment.
During the year the company issued 7,700,000 shares under the employee share plan with a loan
amount payable (option exercise price) of 4 cents per share. Details of these shares are outlined in note
16 to the financial report.
As at 20 August 2019, there are 12,700,000 ordinary shares subject to escrow restrictions.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 17 of 92
Directors’ Report continued
Indemnification and insurance of directors and officers
During the financial year, the Company paid premiums for directors’ and officers’ liability insurance in
respect of Directors and officers, including executive officers of the Company and Directors, executive
officers and secretaries of its controlled entities as permitted by the Corporations Act 2001. The terms
of the policy prohibit disclosure of details of the insurance cover and premiums.
Indemnification of auditors
To the extent permitted by law, the Company has agreed to indemnify its auditors, Pitcher Partners, as
part of the terms of its audit engagement agreement against claims by third parties arising from the
audit (for an unspecified amount). No payment has been made to indemnify Pitcher Partners during or
since the financial year.
Non-audit services
Non-audit services were provided by the company’s auditor, Pitcher Partners, in the current financial
year and by the company’s previous auditor, Ernst & Young, in the comparative financial year. The
Directors are satisfied that the provision of non-audit services is compatible with the general standards
of independence for the auditor imposed by the Corporations Act 2001. Refer to note 24 Auditor’s
Remuneration in the financial reports for details and amounts for the provision of non-audit services.
Vernon Wills
Director
30 August 2019
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 18 of 92
Directors’ Report continued
Remuneration Report (audited)
This remuneration report for the year ended 30 June 2019 outlines the remuneration arrangements of
Site Group International Limited (the Company) and its controlled entities (the Group) in accordance
with the requirements of the Corporations Act 2001 (the Act) and its regulations. This information has
been audited as required by section 308(3C) of the Act.
The remuneration report details the remuneration arrangements for key management personnel (KMP)
who are defined as those persons having authority and responsibility for planning, directing and
controlling the major activities of the Company and the Group, directly or indirectly, including any
director (whether executive or otherwise) of the parent company.
For the purposes of this report, the term “executive” includes the Chief Executive Officer (CEO),
executive directors and other senior executives of the Group.
Nomination and Remuneration Committee
The directors established a Nomination and Remuneration Committee in 2012 and have agreed a
charter and process. The committee convened once during the 2019 financial year with final discussions
about remuneration or appointments being approved by the full board. The Nomination and
Remuneration committee comprises two independent Non-Executive Directors (NEDs).
The Nomination and Remuneration Committee has delegated decision making authority for some
matters related to the remuneration arrangements for NEDs and executives and is required to make
recommendations to the board on other matters.
Specifically, the board approves the remuneration arrangements of the CEO and other executives. The
board also sets the aggregate remuneration of NEDs, which is then subject to shareholder approval,
and NED fee levels.
The board did not seek advice from external remuneration consultants during the year.
The remuneration of the Executive Directors and Non-Executive Directors is set by the Chairman of
Directors and ratified by the Board of Directors.
Directors
The following persons were directors of the Company during the financial year:
• Vernon Wills – Managing Director and Chief Executive Officer
• Nicasio Alcantara – Non-Executive Director
• Peter Jones – Non- Executive Director
Executives (other than directors) with the greatest authority for strategic direction and
management
The following person was the executive with the greatest authority for the strategic direction and
management of the Group (“specified executives”) during the financial year;
• Craig Dawson – Chief Financial Officer
This executive was also considered part of the Key Management Personnel of the Group. In the prior
year Blake Wills (Chief Operating Officer) was also considered a KMP and left the organisation in
November 2017.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 19 of 92
Directors’ Report continued
Remuneration Report (audited) continued
Remuneration of directors and executives
Principles used to determine the nature and amount of remuneration
The objective of the Company’s executive reward framework is to ensure reward for performance is
competitive and appropriate for the results delivered.
Relationship between remuneration and financial performance
The Group is still in the build phase and has incurred additional costs during the build out. Therefore,
there is no direct relationship between the Group’s financial performance and either the remuneration
of directors and executives or the issue of shares and options to the directors and executives.
Remuneration is set at levels to reflect market conditions and encourage the continued services of
directors and executives.
Executive and non-executive directors
Fees and payments to executives and non-executive directors reflect the demands which are made on,
and the responsibilities of the directors. Executive and non-executive directors’ fees and payments are
reviewed annually by the Board.
Directors’ fees
There were Directors’ fees paid during the year to the NEDs with the executive director receiving a fixed
salary of a full-time employee.
Executive pay
The executive pay and reward framework has the following components:
• Base pay benefits
• Other remuneration such as fringe benefits and superannuation
• STI payable based on predetermined KPI’s
• Eligibility to participate in the Employee Share Plan
The combination of these comprises the executive’s total remuneration.
Base pay
Base pay is structured as a total employment cost package which is delivered in cash. Executives are
offered a competitive base pay that comprises the fixed component of pay. Base pay for senior
executives is reviewed annually. An executive’s pay is also reviewed on promotion. There are no
guaranteed base pay increases fixed in any senior executives’ contracts.
Retirement benefits
Retirement benefits are delivered under a range of different superannuation funds. These funds provide
accumulated benefits. Where applicable, statutory amounts are contributed to super funds for all
Australian based Directors and Executives.
Executive contractual arrangements
As Non-Executive Directors are not employees of the company, there are no contractual agreements
with these parties.
Vernon Wills is employed as the Chief Executive Officer through a services contract with Wayburn
Holdings Pty Limited on consistent terms with other executives. No sign on shares were granted.
Escrowed shares are issued at the discretion of the Remuneration Committee from time to time.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 20 of 92
Directors’ Report continued
Remuneration Report (audited) continued
Remuneration arrangements for other executives are formalised in employment agreements. Details of
these contracts are provided below. All other executives have contracts with unspecified ending dates.
The contracts are continuing unless terminated by either party.
Details of remuneration
Details of the remuneration of each director of the Company and each of the two specified executives
of the Group, including their personally related entities, are set out in the following tables.
Directors
The board seeks to set NED fees at a level which provides the Group with an ability to attract and retain
NEDs with the highest calibre, whilst incurring a cost which is acceptable to shareholders.
The Group’s constitution and ASX listing rules specifies the NED maximum aggregate fee pool shall be
determined from time to time at a general meeting. The latest determination was at the 2010 AGM held
on 22 November 2010 when shareholders approved an aggregate fee pool of $350,000 per year.
NED fees consist of base fees and committee fees recognising the additional time commitment required
by NEDs who serve on Board committees. The NEDs may be reimbursed for expenses reasonably
incurred for attending to the Group’s affairs. NEDs do not receive retirement benefits beyond applicable
superannuation contributions.
2019
Name
Short Term Benefits
Post-
employment
Long Term
Benefits
Share-based Payments
Cash Salary Directors Fees
Non- monetary
benefits
Super-
annuation
Long Service
Leave
Options
Shares
Total
Vernon Wills
Nicasio Alcantara
Peter Jones
Total
$
400,000
-
$
$
$
$
$
$
$
-
83,501
44,189
-
- - - -
- - - -
444,189
83,501
-
65,700
-
- - - -
65,700
400,000
149,201
44,189
- - - -
593,390
2018
Short Term Benefits
Name
Cash Salary Directors Fees
$
400,000
-
-
-
-
$
-
77,914
60,000
60,000
65,700
Vernon Wills
Nicasio Alcantara
Darryl Somerville1
Joseph Ganim2
Peter Jones
Total
1Resigned June 2018
2Resigned June 2018
Post-
employment
Super-
annuation
$
Long Term
Benefits
Long Service
Leave
$
Share-based Payments
Options
Shares
$
$
Non- monetary
benefits
$
40,270
-
-
-
-
- - - -
- - - -
5,700 - - -
5,700 - - -
- - - -
Total
$
440,270
77,914
65,700
65,700
65,700
400,000 263,614
40,270
11,400 - - -
715,284
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 21 of 92
Directors’ Report continued
Remuneration Report (audited) continued
Specified executives of the consolidated entity
2019
Short Term Benefits
Name
Craig Dawson
Total
Cash Salary Non- monetary
$
274,952
$
Post-
employment
Super-
annuation
$
Long Term
Benefits
Long Service
Leave
$
Termination
Benefits
Share-based Payments
Options
Shares
$
$
$
Total
$
24,588
26,027
5,247
-
4,781
-
335,595
274,952
24,588
26,027
5,247
-
4,781
-
335,595
2018
Short Term Benefits
Post-
employment
Long Term
Benefits
Termination
Benefits
Share-based Payments
Name
Cash Salary Non- monetary
$
$
Super-
annuation
$
Long Service
Leave
$
Blake Wills1
Craig Dawson
Total
1Resigned November 2017
63,942
297,973
361,915
2,846
7,891
10,737
6,074
26,027
32,101
1,006
5,247
6,253
$
33,654
-
33,654
Options
Shares
$
$
Total
$
-
-
-
-
-
-
107,522
337,138
444,660
Short term incentive (STI)
Under the STI plan, executives have the opportunity to earn an annual incentive award which is
delivered in cash or shares at the discretion of the Remuneration Committee. The STI recognises and
rewards short term performance. The STI award is determined after the end of the financial year
following a review of performance over the year against the STI performance measures.
Group EBITDA and business unit EBITDA are the measures against which management and the
remuneration committee assess the short term financial performance of the Group. Both V. Wills and
C. Dawson had a maximum STI opportunity of 30% of their fixed remuneration. For FY19 0% was
earned and 100% forfeited because the service criteria was not met.
Director and key management personnel options and rights holdings
There were no options over ordinary shares held during the financial year by each KMP of the Group,
other than in respect of the employee share plan below.
Director and key management personnel participation in the employee share plan
In November 2011 the Shareholders approved the establishment of an Employee Share Plan that would
enable employees, directors and eligible associates to subscribe for shares in the Company. Under the
terms of the plan an eligible person is offered shares in the Company at a price determined by the board
with a corresponding interest free loan to assist the person to subscribe for the shares. The shares are
escrowed in two tranches with 50% being escrowed for a minimum of 12 months and 50% being
escrowed for a minimum of 24 months. Subsequent to these minimum restriction periods, the shares
are available for release from escrow (i.e. vested and exercisable option) on the repayment of the loan,
and subject to continuation of employment (including acting as an associate or director) at the time of
repayment.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 22 of 92
Directors’ Report continued
Remuneration Report (audited) continued
For accounting purposes these shares are treated as if these were share options, as whilst the shares
have been issued to the employee their rights to access the shares are subject to both a time based
requirement (continued employment to escrow dates) and valuation uncertainty (share price exceeds
issue price at date of escrow release). Accordingly, shares issued under the plan are valued using a
Black Scholes Option Valuation model with the expense being recognised over the escrow period as a
share based payment.
Mr Dawson was awarded a further 1,000,000 shares under the plan during the year, with a grant date
of 8 March 2019 and a loan price (option exercise price) of 4 cents per share with 500,000 escrowed to
29 March 2019 and 500,000 escrowed to 29 March 2020. No amount has been paid by Mr Dawson in
respect of these shares. The related options have a grant date fair value of 0.64 cents per share and
0.97c per share respectively for each tranche. There are no performance conditions attached to the
shares other than the employee remaining with the group during the escrow period. The shares have
an expiry date (last option exercise date) of 29 March 2022.
The number of ordinary shares held by each KMP of the group under the plan is as follows:
Name
Vern Wills
Balance
1 July
2018
2,000,000
Granted
as
remuneration
-
Nicasio Alcantara
1,000,000
-
Craig Dawson
1,000,000
1,000,000
Total
4,000,000
1,000,000
Shares
sold
Forfeited
Balance
30 June 2019
Tradable
Escrowed
Vested and
Exercisable
-
-
-
-
-
-
2,000,000
1,000,000
(1,000,000)
1,000,000
(1,000,000)
4,000,000
-
-
-
-
2,000,000
2,000,000
1,000,000
1,000,000
1,000,000
500,000
4,000,000
3,500,000
The minimum escrow periods for all shares held by Mr Wills and Mr Alcantara in the table above expired
prior to the start of the comparative period, and the shares therefore represented vested and exercisable
options at both 30 June 2019 and 30 June 2018. Likewise shares held by Mr Dawson at 1 July 2018
represented vested and exercisable options as at that date.
Director and key management personnel share holdings
The number of ordinary shares held by each KMP, other than shares under the Employee Share plan,
is as follows:
Name
Balance
1 July 2018
Granted
as
remuneration
-
Vern Wills
122,395,630
Nicasio Alcantara
8,371,325
Peter Jones
56,819,466
Craig Dawson
1,000,000
Shares
sold
Capital
Raising#
Balance
30 June 2019
-
-
-
-
-
-
-
-
122,395,630
8,371,325
56,819,466
1,000,000
-
-
-
Total
188,586,421
-
-
-
206,979,295
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 23 of 92
Directors’ Report continued
Remuneration Report (audited) continued
Executive remuneration outcomes for 2019
As noted earlier the company is actively developing its core business in Asia and Australia. Executive
Remuneration is targeted at attracting and retaining quality people to lead the Company through this
phase and on to profitability. The Company incurred losses since listing until 2015 however there are a
number of metrics that may be used to judge the effectiveness of the leadership team during this period.
Share price performance
The graph above illustrates the relative performance of the Company share price over the past 12
months. The blue line is the performance of the small ordinaries index – in comparative terms the
Company’s share price has been significantly negatively impacted due to the delays in settlement of
the Department of Education debtor and the regulatory actions currently in progress.
Revenue growth
The following table details reported revenue of the core business for the past seven years:
2019
2018
2017
2016
2015
2014
2013
Total revenue ($)
Growth %
30,913,290 30,306,134 29,213,400 25,406,177 19,467,233 17,314,375 12,960,549
31%
242%
12%
15%
34%
4%
2%
These results are consistent with the company’s strategy of growing revenue in the vocational training
and assessment field.
Net profit/ (loss) and earnings/ (loss) per share
The following table details the net profit/ (loss) and earnings/(loss) per share including the discontinued
operation for the past seven years:
Total profit/(loss)
Change %
Earnings/(loss)
per Share (cents)
Share price at
year end
2019
(4,742,968)
24%
2018
(6,042,212)
88%
2017
2016
2015
(50,466,491) 9,404,816 1,946,454
(637%)
383%
130%
2014
(6,487,117)
(11%)
2013
(5,821,405)
25%
(0.69)
$0.027
(0.92)
$0.025
(9.50)
$0.04
1.84
0.40
$0.19
$0.35
(1.81)
$0.15
(1.92)
$0.119
The year on year improvement of gain/(loss) per share until 2016 and the earnings per share achieved
reflects improved revenue from the expansion of facilities and also incorporates significant integration
of acquired businesses. The impact of the impairments reported in 2018 and 2017, closure of the PP
business and action currently taken by the regulator has significantly impacted the share price and
earnings per share. The leadership team are focused on continuing to grow the core business revenue,
controlling costs and growing earnings.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 24 of 92
Directors’ Report continued
Remuneration Report (audited) continued
Approval of the FY18 Remuneration Report
At the Annual General Meeting of the Company on 22 November 2018, the FY18 remuneration report
was adopted by the shareholders with a vote of 98.1% in favour.
Loan from Director related entity – Wayburn Holdings Pty Ltd
During the current and comparative periods, the group made use of an unsecured loan facility with
Wayburn Holdings Pty Ltd, a company associated with Managing Director and CEO Mr Vernon Wills.
The loan facility limit was $2.35m to 31 December 2016, and $1.32m from that point repayable on the
collection of the receivable from the Commonwealth Department of Education and Training. To date,
the revised terms have not been agreed for the facility and the outstanding balance as disclosed below
is repayable at call. Interest is charged on the loan at a fixed rate of 7% per annum.
Movements in the loan balance during the year are as follows:
Opening Balance
Drawdowns
Interest accrued during the year
Principal repayment through issuance of shares*
Principal repayments (cash)
Interest repayments (cash)
Closing balance
2019
$
266,922
-
14,102
-
(233,189)
(8,928)
38,907
2018
$
580,842
-
25,900
(246,000)
(93,820)
-
266,922
*Details of shares issued in settlement of outstanding loan amounts are as follows:
Date
24/09/2017
Share
Number of
Shares
Price
6,150,000 $0.04
Amount
$
246,000
The issuance of shares on 24 September 2017 includes subscription of shares under the share
purchase plan described above by related entities of Vernon Wills and third parties where the
subscription price was funded by Wayburn Holdings Pty Ltd.
The share price at which the shares were issued represents the fair value of the shares at the date of
issue and reflective of the external raising to other shareholders.
Loan from Director related entity – Punta Properties Inc
On 21 June 2018, the Group announced a financing facility of US$4million with Punta Properties, a
company associated with Non-Executive Director Nicasio Alcantara. Repayment of funds drawn under
the facility will be via cash or equity to be issued at the last issue price of 4 cents per share subject to
approval of shareholders. Interest charged on the loan will be at a fixed rate of 10% per annum.
Movements in the loan balance during the year are as follows:
Opening Balance
Drawdowns
Interest accrued during the year
Recognition of embedded derivative
Foreign currency movement
Closing balance
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
2019
$
-
4,006,980
368,090
(335,128)
127,333
4,167,276
2018
$
-
-
-
-
-
-
Page 25 of 92
Directors’ Report continued
Remuneration Report (audited) continued
Loans from Non-Executive Directors
During the comparative periods, the group made use of unsecured loan facilities with Non-Executive
Directors. Interest charged on the loans was at a fixed rate of 10% per annum.
Movements in the loan balances during the year are as follows:
Opening Balance
Drawdowns
Interest accrued during the year
Principal Repayments (cash)
Interest repayments (cash)
Closing balance
2019
$
-
-
-
-
-
-
2018
$
57,539
45,000
1,229
(45,000)
(58,768)
-
Other transaction with Directors and Key Management Personnel
In addition to the financing facility discussed above, the Group and Punta Properties agreed to a
performance based incentive to develop and execute an optimisation plan for the Group’s Philippines
assets, associated businesses and international expansion. This incentive is payable on the total project
value achieved from the optimisation plan at 5% of the total project value achieved. Should the plan
reach a total project value of US$30m a further 5% fee of the gross value is payable to Mr Alcantara.
There is no retainer applicable or payable to this agreement. The agreement was approved by
shareholder at the annual general meeting of shareholders on 22 November 2018.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 26 of 92
Corporate Governance Statement
The Australian Securities Exchange Limited (ASX) listing rules require a listed Company to provide in
its annual report a statement of the main corporate governance practices that it had in place during the
reporting period. The ASX listing rules also require a listed Company to report any instances where it
has failed to follow the recommendations issued by the ASX Corporate Governance Council (“the
Principles of Good Corporate Governance and Best Practice Recommendations, 3rd Edition”) and the
reasons for not following them.
The best practice recommendations of the ASX Corporate Governance Council are differentiated
between eight core principles that the council believes underlie good corporate governance. The
board’s statements to each core area are noted below:
Principle 1: Lay solid foundations for management and oversight
The ASX Corporate Governance Council guidelines recommend that the board recognise and
publish the respective roles and responsibilities of the board and management and how their
performance is monitored and evaluated. The framework of responsibilities should be designed to:
•
•
•
•
•
•
•
•
enable the board to provide strategic guidance for the Company and effective oversight of
management;
clarify the respective roles and responsibilities of board members and senior executives in
order to facilitate board and management accountability;
undertake appropriate background checks on proposed new directors and ensure sufficient
material information about a director being re-elected is provided to security holders;
ensure a balance of authority so that no single individual has unfettered powers;
ensure the Company enter in to written agreements with each director and senior executive
setting out the terms of their appointment;
ensure the company secretary be accountable directly to the board, through the chair, on
all matters to do with the proper functioning of the board;
establish a policy concerning diversity, that should include a requirement for the board to:
o establish measurable objectives for gender diversity;
o assess annually the objectives set for achieving gender diversity; and
o assess annually the progress made towards achieving the objectives set; and
evaluate the performance of senior executives, the board, committees and individual
directors.
The board of Site Group International Limited are responsible for:
•
•
•
•
•
establishment of long term goals and strategic plans to achieve those goals;
the review and adoption of the annual business plan and budgets for the financial
performance of the Company and monitoring the results on a monthly basis;
appointment and removal of the chief executive officer;
ensuring that the Company has implemented adequate systems of internal controls together
with appropriate monitoring of compliance activities; and
the approval of the annual and half yearly financial statements and reports.
These and other responsibilities are detailed in the approved Board Charter approved in February
2012.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 27 of 92
Corporate Governance Statement continued
The board meets on a regular basis to review the performance of the Company against its goals both
financial and non-financial. In normal circumstances, prior to the scheduled board meetings, each
board member is provided with a formal board package containing appropriate management and
financial reports.
Written agreements are entered in to with each director clearly setting out their roles and
responsibilities. The responsibilities of the management including the chief executive officer and chief
financial officer are contained in letters of appointment and job descriptions given to each executive
on appointment and updated from time to time, usually annually.
The board has not established formal evaluation criteria for the review of itself or its committees and
has not undertaken a specific performance evaluation. The Site Group International Limited board
uses a personal evaluation review to review the performance of Directors. Individual Directors are
asked to communicate to the Chairman on a confidential basis to comment on their own performance,
and the performance of the board and its committee. Key executives are reviewed periodically
against the business objectives and their own contractual obligations, including their personal KPIs.
Appropriate background checks are conducted on proposed new Directors and material information
about a director being re-elected is provided to security holders.
The company secretary work directly with the chair on the functioning of all board and committee
procedures.
The board approved and issued a Diversity Policy in January 2012. The nature of the Site Skills
Training part of the business providing high risk licencing and trades training results in a high
proportion of the trainers being male however the company actively encourages the recruitment of
female staff/contractors where available.
No specific measurable objectives have been established at this stage. As noted above, as the nature
of the company’s business is quite specific, setting measurable objectives may restrict the company’s
development at this stage. Notwithstanding this, the company actively encourages the recruitment of
female staff/contractors where available and will continue to recruit and promote regardless
of gender, age, ethnicity or cultural background.
The following table indicates the current gender mix of employees: -
Male
Female
Male
Female
Total
Board
3
Executive and Senior Managers
10
All Other
Total
194
207
-
2
90
92
100%
-
3
83%
17%
12
68%
32%
284
69%
31%
299
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 28 of 92
Corporate Governance Statement continued
Principle 2: Structure the board to add value
The ASX Corporate Governance Council guidelines recommend that the board be structured in
such a way that it:
•
is of an effective composition, size and commitment to adequately discharge its
responsibilities;
• has a proper understanding of, and competence to deal with, the current and emerging
issues of the business; and
• has an appropriate number of independent non-executive directors who can challenge
management and represent the best interests of security holders as a whole.
To achieve best practice the Council recommends that:
•
the board should establish a nomination committee;
•
listed entities should disclose a board skills matrix;
• a majority of the board be “independent‟ Directors;
•
the chairperson be an “independent” Director and should not be the same person as the
CEO; and
listed entities have a program for inducting new directors and provide appropriate
professional development opportunities.
•
The Company has a Nomination and Remuneration Committee (the Committee) and the board has
approved the charter for the Nomination and Remuneration Committee. The Committee charter is
set out on the Company’s website.
The number of meetings of the Committee held during 2019 is set out in the Directors’ Report.
In 2019 the Committee comprised Mr Peter Jones and Mr Nicasio Alcantara. The Council
recommends that remuneration committees be comprised of at least three independent directors.
Despite both directors being non-executive directors, Mr Jones is not considered independent due
to being a substantial shareholder. Due to Messrs Jones and Alcantara extensive corporate history
and experience, the company believes that given the size and nature of its operations, non-
compliance has not been detrimental.
The Company is developing an appropriate board skills matrix. Comprehensive details about each
director’s experience and skills are set out in the Directors’ Report.
Site Group International Limited’s current board consists of two non-executive Directors and one
executive Director. The Chairman of the Board Mr Peter Jones is not considered to be independent
due to being a substantial security holder. In accordance with the Council’s definition of
independence, Mr Vernon Wills is not considered independent as he is employed in an executive
capacity and is a substantial security holder of the Company.
Directors have the right to seek independent professional advice and are encouraged to undertake
appropriate professional development opportunities in the furtherance of their duties as Directors at
the Group’s expense. Informal induction is provided to any new Directors.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 29 of 92
Corporate Governance Statement continued
Principle 3: Act ethically and responsibly
The ASX Corporate Governance Council guidelines recommend that the Company should:
•
•
clarify the standards of ethical behaviour of Directors and executives by establishing a
code of conduct and encourage the observance of those standards; and
the policy or a summary of that policy is to be disclosed.
Site Group International Limited has a published code of conduct to guide executives, management
and employees in carrying out their duties and responsibilities. The code of conduct covers such
matters as:
•
•
•
• ethical responsibilities;
• employment practices; and
•
responsibilities to shareholders;
compliance with laws and regulations;
relations with customers and suppliers;
responsibilities to the environment and the community.
Principle 4: Safeguard integrity in corporate reporting
The ASX Corporate Governance Council guidelines recommend that the Company have formal
and rigorous processes that independently verify and safeguard the integrity of the company’s
corporate reporting.
To achieve best practice the Council recommends that:
the board should establish an audit committee;
•
• CEO and CFO sign declarations attesting to the accuracy of the Company’s accounts and
that appropriate internal controls are in place; and
the Company ensure the external auditor attends the AGM.
•
The Company has an Audit Committee and the number of meetings of the committee held during the
2019 year is set out in the Directors’ Report.
In 2019 the committee comprised Mr Peter Jones and Mr Nicasio Alcantara with the CEO attending
on an ex officio basis. The Council recommends that audit committees be comprised of at least three
independent directors. Despite the two directors being non-executive directors, Mr Jones is not
considered to be independent due to being a substantial security holder of the Company. Due to
Messrs Jones and Alcantara extensive corporate history and experience in financial matters, the
company believes that given the size and nature of its operations, non-compliance has not been
detrimental.
Audit committee meetings are attended, by invitation, by the engagement partner (or their nominee)
from the Company’s external auditor and such other senior staff or professional people as may be
appropriate from time to time.
Each year the Chief Executive Officer and Chief Financial Officer sign declarations in accordance
with section 295A of the Corporations Act, to confirm that the accounts are correct and in accordance
with relevant legislation and that appropriate financial controls are in place.
The external auditors are required to attend the annual general meeting and are available to answer
any questions from security holders relevant to the audit.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 30 of 92
Corporate Governance Statement continued
Principle 5: Make timely and balanced disclosure
The ASX Corporate Governance Council guidelines recommend that a Company make timely and
balanced disclosure of all matters concerning it that a reasonable person would expect to have a
material effect on the price or value of the Company’s securities. It recommends that it put in place
mechanisms designed to ensure all investors have equal and timely access to material information
concerning the Company (including its financial position, performance, ownership and governance),
and that a Company’s announcements are factual and presented in a clear and balanced way.
The board and senior management team at Site Group International Limited are conscious of the
ASX Listing Rule continuous disclosure requirements and have processes in place to ensure
compliance. Company policy requires:
• all announcements be reviewed by the Chairman and all directors; and
• all media comment is by the Chairman, Managing Director and Chief Financial Officer.
Principle 6: Respect the rights of security holders
The ASX Corporate Governance Council guidelines recommend that a Company respects the
rights of security holders by providing them with appropriate information and facilitates to allow
them to exercise those rights effectively.
To achieve best practice, the Council recommends that Companies:
• Provide information about themselves and their governance on their website;
• Design and implement a suitable investor relations program to facilitate effective two-way
communication with investors;
• Disclose policies and processes to encourage participation at meetings of security holders;
and
• Provide security holders with the option to receive communications electronically.
Site Group International Limited promotes effective communication with shareholders and
encourages effective participation at general meetings by providing information to shareholders:
• Through the release of information to the market via the ASX;
• Through the distribution of the Annual Report and notices of annual general meeting;
• Through shareholder meetings and investor presentations; and
• By posting relevant information on Site Group International’s website: www.site.edu.au
The company’s website has a dedicated investor relations section for the purpose of publishing all
important company information and relevant announcements made to the market.
The external auditors are required to attend the annual general meeting and are available to answer
any shareholder questions about the conduct of the audit and preparation of the audit report.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 31 of 92
Corporate Governance Statement continued
Principle 7: Recognise and manage risk
The ASX Corporate Governance Council guidelines recommend that the Company establish a
sound risk management framework to identify and manage risk on an ongoing basis. It
recommends that the system be designed to identify, assess, monitor and manage risk; and inform
investors of material changes to the Company’s risk profile. It suggests that to achieve “best
practice”, the board or an appropriate board committee should establish policies on risk oversight
and that the Company’s risk management and internal compliance and control system is operating
efficiently and effectively in all material respects.
The Audit and Risk Committee has in its Charter the requirement to consider risks that the Company
has to manage.
The Company has established a Risk Register that is reviewed by the Audit and Risk Committee
annually. Risks are assessed and ranked in accordance with generally accepted risk management
practices with appropriate mitigation strategies adopted where possible.
The Company does not have a separate internal audit function. The board considers that the
Company is not currently of the size or complexity to justify a separate internal audit function, and
that appropriate internal financial controls are in place. Such controls are monitored by senior
financial management and the Audit and Risk Committee.
In addition, the board does consider the recommendations of the external auditors and other external
advisers and where considered necessary, appropriate action is taken to ensure that an environment
is in place that key risks, as identified, are managed.
The Director’s Report sets out some of the key risks relevant to the Company and its operations.
Although not specifically defined as such, the risks include economic, environmental and social
sustainability risks. As noted above, the Company regularly reviews risks facing the Company and
adopts appropriate mitigation strategies where possible.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 32 of 92
Corporate Governance Statement continued
Principle 8: Remunerate fairly and responsibly
The ASX Corporate Governance Council guidelines recommend that the Company ensures that
the level and composition of remuneration is sufficient and reasonable and that its relationship to
corporate and individual performance is defined. In this regard it recommends that companies
adopt remuneration policies that:
• attract and retain high quality Directors;
• attract, retain and motivate high quality senior executives; and
•
to align their interests with the creation of value for security holders.
The Company has a Nomination and Remuneration Committee and the board has approved the
charter for the Nomination and Remuneration Committee. The Committee charter is set out on the
Company’s website.
The number of meetings of the committee held during the 2019 year is set out in the Directors’
Report.
In 2019 the Committee comprised Mr Peter Jones and Mr Nicasio Alcantara. The Council
recommends that remuneration committees be comprised of at least three independent directors.
Despite the two directors being non-executive directors, Mr Jones is not considered to be
independent due to being a substantial security holder in the Company. Due to Messrs Jones and
Alcantara extensive corporate history and experience, the company believes that given the size
and nature of its operations, non-compliance has not been detrimental.
All matters of remuneration and executive appointments were also considered by the full board. At
this stage it is reasonable that the board be accountable for setting their own remuneration and that
of senior executives.
The remuneration of the board’s non-executive and executive directors is set out in the relevant
section of the Annual Report. Details of the nature and amount of each element of the
remuneration of each director of the Company and the key management personnel of the Company
are disclosed in the relevant section of the Annual Report. There is no retirement benefit scheme
for directors other than payment of statutory superannuation.
The Company has adopted a Trading Policy that includes a prohibition on hedging, aimed at
ensuring participants do not enter into arrangements which would have the effect of limiting their
exposure to risk relating to an element of their remuneration.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 33 of 92
The Directors
Site Group International Limited
Level 4, 488 Queen St
BRISBANE QLD 4000
Auditor’s Independence Declaration
In relation to the independent audit for the year ended 30 June 2019, to the best of my knowledge and belief
there have been:
(i)
(ii)
No contraventions of the auditor independence requirements of the Corporations Act 2001; and
No contraventions of APES 110 Code of Ethics for Professional Accountants.
This declaration is in respect of Site Group International Limited and the entities it controlled during the year.
PITCHER PARTNERS
NIGEL BATTERS
Partner
Brisbane, Queensland
30 August 2019
SITE GROUP INTERNATIONAL LIMITED ABN: 73 003 201 910
AND CONTROLLED ENTITIES FOR THE YEAR ENDED 30 JUNE 2019
Statement of Comprehensive Income
Continuing operations
Revenue from contracts with customers
Other income
Interest income
Total income
Contractor and other service providers
Other direct fees and costs
Employee benefits expense
Depreciation and amortisation expense
Finance costs
Other expenses
Occupancy expenses
Foreign currency loss
Loss before tax from continuing operations
Income tax (expense) / benefit
Loss for the year from continuing operations
Discontinued Operations
Consolidated Group
Note
2019
$
2018
$
4
4
5
5
5
6
30,913,290
116,498
66,183
31,095,971
(5,099,795)
(6,907,397)
(12,755,067)
(1,408,074)
(414,741)
(5,580,484)
(3,812,470)
(114,432)
(4,996,489)
(86,311)
(5,082,800)
30,306,134
-
16,197
30,322,331
(4,010,877)
(6,910,359)
(14,029,659)
(2,000,124)
(54,376)
(9,005,747)
(3,531,255)
(163,251)
(9,383,317)
(164,596)
(9,547,913)
Profit / (loss) for the year from discontinued operations
20
339,832
3,505,701
Loss for the year
(4,742,968)
(6,042,212)
Other comprehensive income
Items that may b e reclassified to profit or loss in
sub sequent years (net of tax):
Translation of foreign operations
Items not to b e reclassified to profit or loss in
sub sequent years (net of tax):
Remeasurement gain/(loss) on defined benefit plan
Total other comprehensive income (loss)
Total comprehensive loss
Earnings per share
Earnings per share for (loss) / profit attributable to the
Basic and diluted (cents per share)
Earnings per share for continuing operations
Earnings per share for loss from continuing operations
attributable to the ordinary equity holders of the parent
Basic and diluted (cents per share)
3
3
563,905
12,994
(58,171)
505,734
54,492
67,486
(4,237,234)
(5,974,726)
(0.69)
(0.92)
(0.74)
(1.46)
The above statement of comprehensive income should be read in conjunction with the accompanying
notes.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 35 of 92
SITE GROUP INTERNATIONAL LIMITED ABN: 73 003 201 910
AND CONTROLLED ENTITIES AS AT 30 JUNE 2019
Statement of Financial Position
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Inventories
Prepayments
Current tax asset
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Property, plant and equipment
Intangible assets
Security deposits
Other non-current financial assets
Deferred income tax asset
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Trade and other payables
Contract liabilites
Interest bearing debt
Current tax liabilities
Provisions
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Trade and other payables
Provisions
Interest bearing debt
Other financial liabilities
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Retained losses
TOTAL EQUITY
Note
Consolidated Group
2019
2018
$
$
7
8
9
6
10
11
12
13
10
13
12
17
14
15
15
606,148
4,378,367
32,002
481,137
37,249
5,534,903
8,700,694
1,509,216
775,703
105,748
875,929
11,967,290
1,533,437
3,334,449
32,612
359,255
-
5,259,753
7,722,575
1,459,065
630,112
147,237
959,251
10,918,240
17,502,193
16,177,993
6,080,122
390,458
142,519
96,878
592,326
7,302,303
5,595,083
2,921,005
4,238,419
218,630
12,973,137
20,275,440
(2,773,247)
4,659,104
623,824
359,078
49,254
706,396
6,397,656
5,595,083
2,563,987
166,508
-
8,325,578
14,723,234
1,454,759
78,085,284
2,655,191
(83,513,722)
(2,773,247)
78,085,284
2,082,058
(78,712,583)
1,454,759
The above statement of financial position should be read in conjunction with the accompanying notes.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 36 of 92
SITE GROUP INTERNATIONAL LIMITED ABN: 73 003 201 910
AND CONTROLLED ENTITIES FOR THE YEAR ENDED 30 JUNE 2019
Statement of Changes in Equity
Consolidated Group
Balance at 30 June 2017
Com prehensive incom e
Loss for the year
Other comprehensive income for the year
Total com prehensive incom e / (loss) for the year
Transactions w ith ow ners, in their capacity as
ow ners, and other transfers
Shares issued during the year
Shares to be issued
Transaction costs
Share-based payments
Total transactions w ith ow ners and other transfers
Share Capital
(note 17)
$
Retained
earnings /
(losses)
(note 26)
$
Foreign
currency
translation
reserve
(note 26)
$
Share based
payments
reserve
(note 26)
$
Total
$
75,742,840
(72,724,863)
557,389
1,451,675
5,027,041
-
-
-
(6,042,212)
54,492
(5,987,720)
-
12,994
12,994
2,500,000
(157,556)
-
2,342,444
-
-
-
-
-
-
-
-
-
-
-
-
-
60,000
60,000
(6,042,212)
67,486
(5,974,726)
2,500,000
(157,556)
60,000
2,402,444
Balance at 30 June 2018
78,085,284
(78,712,583)
570,383
1,511,675
1,454,759
Com prehensive incom e
Loss for the year
Other comprehensive income for the year
Total com prehensive incom e /(loss) for the year
Transactions w ith ow ners, in their capacity as
ow ners, and other transfers
Shares issued during the year
Transaction costs
Share-based payments
Total transactions w ith ow ners and other transfers
-
-
-
-
-
-
-
(4,742,968)
(58,171)
(4,801,139)
-
563,905
563,905
-
-
-
-
-
-
-
-
-
-
-
-
-
9,228
9,228
(4,742,968)
505,734
(4,237,234)
-
-
9,228
9,228
Balance at 30 June 2019
78,085,284
(83,513,722)
1,134,288
1,520,903
(2,773,247)
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 37 of 92
SITE GROUP INTERNATIONAL LIMITED ABN: 73 003 201 910
AND CONTROLLED ENTITIES FOR THE YEAR ENDED 30 JUNE 2019
Statement of Cash Flows
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Payments to suppliers and employees
Interest received
Finance payments
Income tax refund received
Income tax paid
Consolidated Group
Note
2019
$
2018
$
30,222,732
34,355,795
(34,544,077)
(34,458,894)
63,641
(24,906)
1,688,960
16,164
(82,469)
-
(86,989)
(558,420)
Net cash (used in) operating activities
21
(2,680,639)
(727,824)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment
Payments for Investments
Proceeds from disposals
Purchase of intangible assets
Cash backed performance bonds
Net cash (used in) investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Proceeds from borrowings
Repayment of borrowings
Principal repayments - finance leases
Transaction costs on shares
Net cash provided by financing activities
Net (decrease) / increase in cash held
Effect of exchange rates on cash holdings in foreign
currencies
Cash and cash equivalents at beginning of financial year
(1,323,382)
(727,073)
-
8,157
(59,051)
60,791
(503,658)
(469,761)
(132,512)
(798)
(1,951,395)
(1,195,892)
-
2,254,000
4,006,980
45,000
(242,117)
(138,820)
(83,909)
(83,655)
-
(157,556)
3,680,954
1,918,969
(951,080)
(4,747)
23,791
9,642
1,533,437
1,528,542
17d
17d
12
Cash and cash equivalents at end of financial year
8
606,148
1,533,437
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 38 of 92
SITE GROUP INTERNATIONAL LIMITED ABN: 73 003 201 910
AND CONTROLLED ENTITIES
Notes to the Financial Statements for the Year Ended 30 June 2019
Note 1
Corporate Information
The consolidated financial report of Site Group International Limited (the Company) and its controlled
entities (the Group) for the year ended 30 June 2019 was authorised for issue in accordance with a
resolution of the directors on 30 August 2019.
Site Group International Limited is a company limited by shares incorporated in Australia whose
shares are publicly traded on the Australian Securities Exchange (ASX Code: SIT). The Group is a
for-profit entity for the purposes of preparation of this financial report.
The nature of the operations and principal activities of the Group are described in the directors' report.
Note 1a
Summary of significant accounting policies
The principal accounting policies adopted in the preparation of this financial report are set out below.
These policies have been consistently applied to the years presented unless otherwise stated.
Basis of Preparation
The financial report is a general purpose financial report, which has been prepared in accordance with
the requirements of the Corporations Act 2001, Australian Accounting Standards and other
authoritative pronouncements of the Australian Accounting Standards Board (AASB). The financial
report has been prepared on an accruals basis and is based on historical costs unless otherwise
stated.
Australian Accounting Standards set out accounting policies that the AASB has concluded would
result in a financial report containing relevant and reliable information about transactions, events and
conditions. Material accounting policies adopted in the preparation of this financial report are
presented below. They have been consistently applied unless otherwise stated.
The financial report is presented in Australian dollars.
(a)
Compliance with IFRS
The financial report complies with Australian Accounting Standards and International Financial
Reporting Standards as issued by the International Accounting Standards Board.
(b)
Going concern
The financial report has been prepared on the basis that the Group will continue to meet its financial
obligations as and when they fall due and can therefore continue normal activities, including the
settlement of liabilities and the realisation of assets in the ordinary course of business.
In the financial year ended 30 June 2019 the Group made a net loss of $4,742,968 (2018: loss of
$6,042,212) and the cash outflow from operating activities for the year was $2,680,639 (2018:
$727,824). These results were significantly impacted by legal costs incurred and reputational harm
arising from ongoing regulatory action. At 30 June 2019, the Group had deficiencies in net assets and
net current assets of $2,773,247 and $1,767,400 respectively.
Site remains in dispute with the Australian Skills Quality Authority (ASQA) in the Administrative
Appeals Tribunal (AAT) and Federal Court, and in the Federal Court with the pending Australian
Competition and Consumer Commission (ACCC) litigation. These actions appear likely to continue for
some time, potentially into the second half of 2020.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 39 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
In July 2019, at the initial stage of the AAT hearing for Site Skills Group (SSG), the ongoing
unconditional stay of the ASQA renewal of registration rejection decision was confirmed and has
remained since 21 May 2018. The substantive issue of SSG operations remains before the AAT.
A trial date has been set (June 2020) for the Productivity Partners proceedings brought by the ACCC.
The ACCC has commenced civil proceedings against Site, Productivity Partners and two former
executives in relation to enrolment practices of the college in 2015.
As a consequence of the impairment taken in the previous financial year, no amount has been
reflected in the balance sheet for the receivable ($20,977,645 – refer note 7) due from the
Commonwealth Government Department of Education and Training (DET), even though the Group
maintains the position that it is entitled to the funds. Non-current trade and other payables
($5,595,083 – refer note 10) will not result in an outflow of funds from the Group unless the DET
receivable is collected.
The Group had access to a further $US1,100,000 ($AUD1,658,000) in undrawn facilities at balance
date under the loan arrangement with Punta Properties described in note 17. The loan terms will not
result in a cash outflow from the Group in settlement of the loan unless there is a significant cash
inflow to fund such settlement.
Subsequent to balance date, the Group has successfully raised $3,750,000 capital through placement
of 93,750,000 shares.
Although the directors expect results and operating cash flows to continue to be negatively impacted
by the ongoing regulatory actions described above, current forecasts of operational performance and
capital expenditure requirements indicate that the Group will be cash flow positive in the 2020
financial year having regard to undrawn financing facilities and the post-balance date capital raising
described above.
The directors are of the opinion that at the date of the signing of the financial statements there are
reasonable grounds to believe that, having regard to the matters set out above, the Group will
continue to operate as a going concern in the foreseeable future.
(c)
New Accounting Standards and Interpretations
(i) Changes in accounting policy and disclosures.
AASB 15 Revenue from Contracts with Customers, and AASB 9 Financial Instruments, are applicable
to the Group for the first time in the current financial year. Neither of the standards has had a material
impact on the amounts recorded within the Group’s financial statements, consistent with the
assessment of likely impact disclosed in the Group’s 30 June 2018 financial statements. The group
has made changes necessary to comply with the requirements of the new standards, specifically:
• Required disaggregation disclosures under AASB 15 are made within note 2. Revenues are
disaggregated into the categories described in note 1a(o) and by geographical location.
• Accounting policies for revenue recognition (note 1a(o)) have been updated to align with the
requirements of AASB 15. The timing of revenue recognition under the revised revenue
recognition policies does not differ from the timing which prevailed in previous years.
• Contract liabilities (formerly revenue received in advance) have been separately classified and
required disclosures pertaining to these liabilities have been made in note 11. Comparative
balances have been reclassified for consistency with current period disclosures, resulting in
unearned income of $623,824 recognised within trade and other payables in the 30 June 2018
financial statements being reclassified as contract liabilities.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 40 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
• The Group has adopted the simplified approach to determining an allowance for expected
credit losses on trade receivables, as prescribed under AASB 9. The balance of the allowance
for credit losses as determined at 30 June 2018 was $21,199,556, which is $471,897 lower
than the balance of the provision for impairment of receivables recognised in the financial
statements at 30 June 2018. This change has been recognised in current period profit and loss,
rather than as an adjustment to opening retained earnings or restatement of comparative
balances as required under the transition provisions of AASB 9, as it is not considered to be
material. The change is reflected in the rollforward of the loss allowance provided in note 7.
(ii) Accounting Standards and Interpretations issued but not yet effective.
Relevant accounting standards and interpretations that have been issued or amended but are not yet
effective and have not been adopted for the year are as follows, incorporating the group’s assessment
of the likely impact of the standards on the amounts and disclosures within the financial statements in
the period of initial application. The Group does not anticipate early adoption of any of these reporting
requirements and unless mentioned below, does not expect them to have any material effect on the
company’s financial statement
AASB 16 Leases – The new standard replaces AASB 117 and requires that:
- All leases are ‘capitalised’ by recognising the present value of the lease payments and
showing them either as lease assets (right-of-use assets) or together with property, plant and
equipment.
- A financial liability is recognised representing obligations to make future lease payments.
The standard permits either a full retrospective or a modified retrospective approach for the adoption.
The financial impact of the new standard in the 2020 financial year will be dependent on the Group’s
lease arrangements in place when the new standard is effective, and the accounting approach
adopted. However on implementation of the new standard the Group is currently estimating an
increase in assets and liabilities of $7.497m at 1 July 2019, increase in earnings before interest, tax,
depreciation and amortisation (EBITDA) of $1.686m, and a reduction in reported profit after tax of
$0.293m for the year ended 30 June 2020.
(d)
Basis of consolidation
The consolidated financial statements comprise the financial statements of the Group as at, and for
the period ended, 30 June each year. Control is achieved when the Group is exposed, or has rights,
to variable returns from its involvement with the investee and has the ability to affect those returns
through its power over the investee. Specifically, the Group controls an investee if and only if the
Group has:
• Power over the investee (i.e. existing rights that give it the current ability to direct the relevant
activities of the investee);
• Exposure, or rights, to variable returns from its involvement with the investee; and
• The ability to use its power over the investee to affect its returns.
When the Group has less than a majority of the voting or similar rights of an investee, the Group
considers all relevant facts and circumstances in assessing whether it has power over an investee,
including:
• The contractual arrangement with the other vote holders of the investee;
• The rights arising from other contractual arrangements; and
• The Group’s voting rights and potential voting rights.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 41 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that
there are changes to one or more of the three elements of control. Consolidation of a subsidiary
begins when the Group obtains control over the subsidiary and ceases when the Group loses control
of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of
during the year are included in the statement of comprehensive income from the date the Group gains
control until the date the Group ceases to control the subsidiary.
When necessary, adjustments are made to the financial statements of subsidiaries to bring their
accounting policies into line with the Group’s accounting policies. All intra-group assets and liabilities,
equity, income, expenses and cash flows relating to transactions between members of the Group are
eliminated in full on consolidation.
(e)
Foreign currency translation
Both the functional and presentation currency of Site Group International Limited and its Australian
subsidiaries are Australian dollars ($). The Philippines branch’s functional currency is the Philippine
Peso (PHP), Site Group International Pte Ltd’s functional currency is Singapore Dollars (SGD) and
Competent Project Management Sdn Bhd’s functional currency is Malaysian Ringgit (MYR). Each of
these is translated to the presentation currency.
On consolidation, the assets and liabilities of the Asian operations are translated into Australian
Dollars at the rate of exchange prevailing at the reporting date and the statement of comprehensive
income is translated at the exchange rate prevailing at the dates of the transactions. The exchange
differences arising on translation for consolidation are recognised in other comprehensive income.
(f)
Cash and cash equivalents
Cash and cash equivalents in the statement of financial position and in the statement of cash flows
comprise cash at bank and in hand and short-term deposits with an original maturity of three months
or less that are readily convertible to known amounts of cash and which are subject to an insignificant
risk of changes in value.
(g)
Financial instruments – initial recognition and subsequent measurement
Financial assets
Initial recognition and measurement
Financial assets within the scope of AASB 9 Financial Instruments are classified as at amortised cost,
at fair value through profit and loss, or at fair value through other comprehensive income. The group
determines the classification of its financial assets at initial recognition.
All financial assets are recognised initially at fair value plus transaction costs, except financial assets
recorded at fair value through profit or loss, on the basis of both the group’s business model for
managing the financial assets, and the contractual cash flow characteristics of the financial asset.
The Group’s financial assets include cash and short-term deposits (amortised cost), receivables from
contracts with customers (amortised cost), other receivables (amortised costs), and quoted and
unquoted financial instruments (fair value through profit and loss).
Receivables from contracts with customers are recognised when the group has an unconditional right
to consideration arising from the transfer of goods or services to the customer (i.e. only the passage
of time is required before payment of the consideration is due). Where this is not the case, the
resultant asset is a contract asset (refer note 1a(p)).
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 42 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
Purchases or sales of financial assets that require delivery of assets within a time frame established
by regulation or convention in the market place (regular way trades) are recognised on the trade date,
i.e., the date that the group commits to purchase or sell the asset. Other financial assets are
recognised if the entity becomes party to contract provisions of the asset.
Subsequent measurement
The subsequent measurement of financial assets depends on their classification as described below.
Financial assets at amortised cost
Subsequent to initial measurement, these assets are measured at amortised cost using the Effective
Interest Rate (EIR) method, less allowances for credit losses. Amortised cost is calculated by taking
into account any discount or premium on acquisition and fees or costs that are an integral part of the
EIR. The EIR amortisation is included in interest revenue in the statement of comprehensive income.
Financial assets at fair value through profit and loss
Subsequent to initial measurement, these assets are measured at fair value with changes in fair value
being recognised in profit or loss as they arise.
Derecognition
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial
assets) is derecognised when:
• The rights to receive cash flows from the asset have expired; or
• The Group has transferred its rights to receive cash flows from the asset or has assumed an
obligation to pay the received cash flows in full without material delay to a third party under a
“pass-through” arrangement; and either (a) the Group has transferred substantially all the
risks and rewards of the asset, or (b) the Group has neither transferred nor retained
substantially all the risks and rewards of the asset, but has transferred control of the asset.
Impairment of financial assets at amortised cost
The group applies the simplified expected credit loss model prescribed in AASB 9 to determine an
allowance for expected credit losses on receivables from contracts with customers and its other
receivables measured at amortised cost. Under this approach, the lifetime expected credit losses are
estimated using a provision matrix based on historical losses observed on similar assets, adjusted for
the group’s forecasts of future economic conditions. The measurement of expected credit losses
reflects the group’s ‘expected rate of loss’, which is a product of the probability of default and the loss
given default, and its ‘exposure at default’, which is typically the carrying amount of the relevant asset.
The group has identified contractual payments more than 90 days past due as default events for the
purpose of measuring expected credit losses. These default events have been selected based on the
group’s historical experience.
Previous accounting policy for impairment of trade receivables
In the prior year, the impairment of trade receivables was assessed based on the incurred loss model
as required under AASB 139 Financial Instruments: Recognition and Measurement. The group
assessed, whether there was any objective evidence of impairment as a result of one or more events
that had occurred after the initial recognition of the asset (incurred “loss event”) and that loss event
had an impact on estimated future cash flows of the financial asset or the group of financial assets
that could be reliably estimated. Evidence of impairment may have included indications the debtor or
group of debtors was experiencing significant financial difficulty, default or delinquency in interest or
principal payments, probability of the debtor entering bankruptcy or other financial reorganisation, and
when observable data indicated there was a measurable decrease in estimated future cash flows,
such as changes in arrears or economic conditions that correlate with defaults.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 43 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
Financial liabilities
Initial recognition and measurement
Financial liabilities within the scope of AASB 9 Financial Instruments are classified as at amortised
cost, at fair value through profit and loss, or as derivatives designated as hedging instruments as
appropriate. The Group determines the classification of its financial liabilities at initial recognition.
All financial liabilities are recognised initially at fair value plus, in the case of loans and borrowings,
directly attributable transaction costs. The Group’s financial liabilities include trade and other payables
(amortised costs), loans and borrowings (amortised cost) and derivative financial instruments (fair
value through profit and loss).
Loans and borrowings
After initial recognition, interest bearing loans and borrowings are subsequently measured at
amortised cost using the EIR method. Gains and losses are recognised in the statement of
comprehensive income when the liabilities are derecognised as well as through the EIR amortisation
process. Amortised cost is calculated by taking into account any discount or premium on acquisition
and fees or costs that are an integral part of the EIR. The EIR amortisation is included in finance costs
in the statement of comprehensive income.
Derivative financial instruments
Derivative financial instruments held by the group represent embedded conversion options on
borrowing facilities. The embedded derivative component of the debt is required to be separated and
accounted for as at fair value through profit and loss, with fair value gains and losses on
remeasurement recognised in profit and loss.
Derecognition
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or
expires.
Offsetting of financial instruments
Financial assets and financial liabilities are offset, and the net amount reported in the consolidated
statement of financial position if, and only if:
• There is a currently enforceable legal right to offset the recognised amounts
• There is an intention to settle on a net basis, or to realise the assets and settle the liabilities
simultaneously
(i)
Property, plant, and equipment
Each class of property, plant and equipment is carried at cost or fair value as indicated less, where
applicable, any accumulated depreciation and impairment losses.
Leasehold Improvements
Leasehold improvements are initially shown at their cost, less subsequent depreciation.
Plant and Equipment
Plant and equipment are measured on the cost basis, less depreciation and impairment losses.
Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as
appropriate, only when it is probable that future economic benefits associated with the item will flow to
the company and the cost of the item can be measured reliably.
All other repairs and maintenance are charged to profit and loss during the financial period when they
are incurred.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 44 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
Depreciation
The depreciable amount of all fixed assets, excluding freehold land, is depreciated on a straight-line
basis over the asset's useful life to the company commencing from the time the asset is held ready for
use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the
lease or the estimated useful life of the improvement.
The estimated lives used for each class of depreciable assets are:
Class of fixed asset
Building and Leasehold improvements 2 – 25 years
2 – 20 years
Furniture and fittings
3 – 5 years
Computer equipment
3 – 5 years
Vehicles
Estimated Life
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each
balance sheet date.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount.
These gains or losses are included in profit or loss.
(j)
Leases
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.
Group as a lessee
Leased assets are depreciated on a straight-line basis over the shorter of their estimated useful lives
or the lease term.
Finance leases, which transfer to the Group substantially all the risks and benefits incidental to
ownership of the leased item, are capitalised at the inception of the lease at the fair value of the
leased asset or, if lower, at the present value of the minimum lease payments. Lease payments are
apportioned between the finance charges and reduction of the lease liability so as to achieve a
constant rate of interest on the remaining balance of the liability. Finance charges are recognised as
an expense in profit or loss. Capitalised leased assets are depreciated over the shorter of the
estimated useful life of the asset and the lease term if there is no reasonable certainty that the Group
will obtain ownership by the end of the lease term.
Operating lease payments are recognised as an expense in the statement of comprehensive income
on a straight-line basis over the lease term. Operating lease incentives are recognised as a liability
when received and subsequently reduced by allocating lease payments between rental expense and
reduction of the liability.
(k)
Intangible assets
Goodwill
Goodwill is initially recorded at the amount by which the purchase price for a business combination
exceeds the fair value attributed to the interest in the net fair value of identifiable assets, and
liabilities. After initial recognition, goodwill acquired in a business combination is measured at cost
less any accumulated impairment losses. Goodwill is not amortised but is subject to impairment
testing on an annual basis or whenever there is an indication of impairment.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 45 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
Training Licences and Course Material
Site Group acquires licenced course material with significant scope (approved courses) in high risk
training. The economic potential of these licences and courses was assessed as part of the
acquisition price and recorded as an intangible asset which is being amortised on a straight line basis
over five years.
Licences
Site Group acquires licences to offer scope of training and access to government funding options. The
economic potential of these licences was assessed as part of the acquisition price and recorded as an
intangible asset and amortised on a straight line basis over 20 years.
Customer Contracts
Site group acquires customer contracts with significant value to be realised through the profit and loss
in future periods. The economic potential of these contracts is measured as a risk adjusted
discounted cash flow to be generated from these contracts and recorded as an intangible asset which
is amortised on a straight line basis over the relevant contract period.
Brand
Site group acquires brands that are recognised by customers in relevant markets and generate future
activity for the company.
The economic potential of these brands in the form of future revenue generating potential is assessed
as a discounted cash flow and recorded as an indefinite useful life intangible and tested for
impairment annually.
The assessment of indefinite life is reviewed annually to determine whether the indefinite life
continues to be supportable. If not, the change in useful life from indefinite to finite is made on a
prospective basis.
(l)
Impairment of non-financial assets
At each reporting date, the company reviews the carrying values of its tangible and intangible assets
to determine whether there is any indication that those assets have been impaired. If such an
indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value less
costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s
carrying value over its recoverable amount is expensed to the statement of comprehensive income.
Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.
Where an individual asset does not independently generate cash flows, the company estimates the
recoverable amount of the cash-generating unit to which the asset belongs.
(m)
Provisions and employee benefits
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result
of a past event, it is probable that an outflow of cash or non-cash resources will be required to settle
the obligation and a reliable estimate can be made of the amount of the obligation. When the Group
expects some or all of a provision to be reimbursed, for example under an insurance contract, the
reimbursement is recognised as a separate asset but only when the reimbursement is virtually
certain. The expense relating to any provision is presented in the statement of comprehensive income
net of any reimbursement. Provisions are measured at the present value of management's best
estimate of the expenditure required to settle the present obligation at the reporting date. The
discount rate used to determine the present value reflects current market assessments of the time
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 46 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
value of money and the risks specific to the liability. The increase in the provision resulting from the
passage of time is recognised in finance costs.
Employee leave benefits
(i) Wages, salaries, annual leave and sick leave
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be
wholly settled within 12 months of the reporting date are recognised in respect of employees' services
up to the reporting date. They are measured at the amounts expected to be paid when the liabilities
are settled. Based on historical evidence no discounting of annual leave has been applied. Expenses
for non-accumulating sick leave are recognised when the leave is taken and are measured at the
rates paid or payable. Liabilities for wages, salaries and annual leave are recognised as current
liabilities and the group does not have an unconditional right to defer settlement beyond 12 months.
(ii) Long service leave
The liability for long service leave is recognised and measured as the present value of expected
future payments to be made in respect of services provided by employees once an employee reaches
five years of service. Expected future payments are discounted using market yields at the reporting
date on the applicable corporate bonds with terms to maturity and currencies that match, the
estimated future cash outflows. Where the group has an unconditional right to defer settlement of the
liability beyond 12 months of the balance date, the provision is classified as non-current. Otherwise,
the provision is classified as a current liability.
(n)
Taxes
Income tax
Current Tax
Current tax assets and liabilities for the current and prior periods are measured at the amount
expected to be recovered from or paid to the tax authorities. The tax rates and tax laws used to
compute the amount are those that are enacted or substantively enacted at the reporting date.
Deferred Tax
Deferred tax is provided using the balance sheet liability method on temporary differences at the
reporting date between the tax bases of assets and liabilities and their carrying amounts for financial
reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
• When the deferred income tax liability arises from the initial recognition of goodwill or of 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 profit nor taxable profit or loss.
• When the taxable temporary difference is associated with investments in subsidiaries,
associates or interests in joint ventures, and the timing of the reversal of the temporary
difference can be controlled and it is probable that the temporary difference will not reverse in
the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of
unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be
available against which the deductible temporary differences and the carry-forward of unused tax
credits and unused tax losses can be utilised, except:
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 47 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
• When the deferred income tax asset relating to the deductible temporary difference arises
from the initial recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the accounting profit nor
taxable profit or loss
• When the deductible temporary difference is associated with investments in subsidiaries,
associates or interests in joint ventures, in which case a deferred tax asset is only recognised
to the extent that it is probable that the temporary difference will reverse in the foreseeable
future and taxable profit will be available against which the temporary difference can be
utilised.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to
the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part
of the deferred income tax asset to be utilised. Unrecognised deferred tax assets are reassessed
each reporting date and are recognised to the extent it has become probable that future taxable profit
will allow recovery of the deferred tax asset.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to
the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that
have been enacted or substantively enacted at the reporting date. Deferred tax assets and deferred
tax liabilities are offset, if a legally enforceable right exists to offset current tax assets against current
tax liabilities and the deferred taxes relate to the same taxable entity and the same tax authority.
Tax consolidation legislation
Site Group International Limited and its wholly owned Australian controlled entities have implemented
the tax consolidation legislation. The head entity, Site Group International Limited and the controlled
entities in the tax consolidated group continue to account for their own current and deferred tax
amounts. The Group has applied the group allocation approach in determining the appropriate
amount of current taxes and deferred taxes to allocate to members of the tax consolidated group.
In addition to its own current and deferred tax amounts, Site Group International Limited also
recognises the current tax liabilities (or assets) and the deferred tax assets arising from unused tax
losses and unused tax credits assumed from controlled entities in the tax consolidated group.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are
recognised as amounts receivable from or payable to other entities in the Group.
Any differences between the amounts assumed and the amounts receivable or payable under the tax
funding agreement are recognised as contributions to (or distribution from) wholly owned tax
consolidated entities.
Goods and services tax (GST)
Revenues, expenses, assets and liabilities are recognised net of the amount of GST, except where
the amount of GST incurred is not recoverable from the Tax Office. In these circumstances, the GST
is recognised as part of the cost of acquisition of the asset or as part of an item of the expense.
Receivables and payables in the balance sheet are shown inclusive of GST. GST receivable and
payable has been offset against one another. Commitments are shown net of GST.
In the statement of cash flows, receipts from customers are shown inclusive of GST and payments to
suppliers and employees are shown inclusive of GST and GST recovered from the tax office is shown
in receipts from customers.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 48 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
(o)
Revenue recognition
Revenue from contracts with customers is recognised either at a point in time or over time depending
on the nature of the contract, including the timing of satisfaction of performance obligations and the
transfer of control to the customer. The group’s contracts with customers fall into the following
categories:
Revenue
Stream
Nature of
Goods or
Services
Promised
Typical
Performance
Obligations
When Performance Obligation is
Typically Satisfied
Course fees and
Government
subsidies
Training
Service
Delivery of training
course
Over time, being throughout the period
of the course. For short-term (i.e. one
day) courses the performance
obligation may be satisfied at a point in
time, being the date of course delivery.
Specific
projects with
performance
milestones &
project
delivery
indicators
Construction
of Safe Life
Processing
Plant (SLPP)
Specific project
milestones as
specified in each
individual contract.
Performance obligation: Specific
project milestones as specified in
contract, with a transaction price
allocated to each milestone. Project
delivery in most instances will not
extend over more than one financial
period.
Project
income
Ongoing
project
service
income
Facility
Management
of Safe Life
Processing
Plant (SLPP)
Delivery of a
service over the
length of the
contract period.
Over time, being as the services are
delivered over the duration of the
contract.
Placement services
Recruitment
and labour
hire services
1. Placement of
personnel at
inception
2. Provision of
employee for a
fixed period of
time
Placement: At a point in time, being
when the employee has been
successfully placed (i.e. acceptance of
placement by customer).
Provision of employee: Over time,
being the period of time that staff are
employed.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Method Used to
Determine Progress
Towards Complete
Satisfaction of
Performance Obligation
An output method is used
being contact days
elapsed as a percentage
of total contact days. This
is considered the most
appropriate basis for
recognition of revenue as
it is readily observable
and sufficiently linked to
the performance
obligations specified in
the contract.
An input method is used,
based on the amount of
contract costs incurred as
a percentage of budgeted
contract costs
An output method is
applied based on either
time elapsed, units
delivered, or milestones
reached dependent on
the terms of the individual
contracts. Control is
considered to pass in a
manner consistent with
measurement provided
by this method.
An output method (time
elapsed on percentage of
total time) is used. This
reflects the expectation of
consistency in transfer of
services over the contract
period for labour
services.
Page 49 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
Contracts with customers do not typically involve a significant financing component. Course fee
contracts may specify an entitlement to receive a portion of the contract value in advance of services
being provided, however the period of time between payment being received and course delivery is
generally not greater than 12 months. Amounts received in advance of services being provided are
recognised as contract liabilities (refer note 1a(p)).
No disclosure has been made within the financial statements of the aggregate amount of the
transaction price allocated to performance obligations that are unsatisfied (or partially unsatisfied) as
of the end of the reporting period, as these performance obligations relate to contracts that have an
original expected duration of one year or less.
There are no elements of consideration under any of the above revenue streams that are variable in
nature.
(p)
Contract assets and contract liabilities
Contract assets represent the group’s right to consideration (not being an unconditional right
recognised as a receivable) in exchange for goods or services transferred to the customer. Contract
assets are measured at the amount of consideration that the group expects to be entitled in exchange
for goods or services transferred to the customer.
Contract liabilities represent the group’s obligation to transfer goods or services to the customer for
which the group has received consideration (or an amount of consideration is due) from the customer.
Amounts recorded as contract liabilities are subsequently recognised as revenue when the group
transfers the contracted goods or services to the customer.
(q)
Comparative figures
Where necessary, comparative figures have been adjusted to conform to changes in presentation for
the current financial year where required by accounting standards or as a result of changes in
accounting policy. Disclosure of the amounts and basis for such changes is made, where material, in
note 1a(c)(i) and note 11.
(r)
Share-based payment transactions
The Group provides benefits to its employees (including key management personnel) in the form of
share-based payments, whereby employees render services in exchange for shares or rights over
shares (equity settled transactions). Site Group currently has an Employee Share Plan (ESP), which
provides benefits to directors and all eligible employees. The cost of these equity-settled transactions
with employees is measured by reference to the fair value of the equity instruments at the date at
which they are granted. The fair value is determined by using a binomial model, further details of
which are given in note 16.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity,
over the period in which the performance and/or service conditions are fulfilled (the vesting period),
ending on the date on which the relevant employees become fully entitled to the award (the vesting
date). At each subsequent reporting date until vesting, the cumulative charge to profit or loss is the
product of:
• The grant date fair value of the award;
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 50 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1a
Summary of significant accounting policies continued
• The current best estimate of the number of awards that will vest, taking into account such
factors as the likelihood of employee turnover during the vesting period and the likelihood of
non- market performance conditions being met; and
• The expired portion of the vesting period.
The charge to profit or loss for the period is the cumulative amount as calculated above less the
amounts already charged in previous periods. There is a corresponding entry to equity. The expense
associated with equity-settled awards granted by Site Group to employees of subsidiaries are
recorded as an expense in the subsidiary and funded by advances from the parent which eliminate on
consolidation. The expense recognised by the Group is the total expense associated with all awards.
Until an award has vested, any amounts recorded are contingent and will be adjusted if more or fewer
awards vest than were originally anticipated to do so. Any award subject to a market condition or non-
vesting condition is considered to vest irrespective of whether or not that market condition or non-
vesting is fulfilled, provided that all other conditions are satisfied.
(s)
Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new
shares or options are shown in equity as a deduction, net of tax as applicable, from the proceeds.
(t)
Fair value measurement
All assets and liabilities for which fair value is measured or disclosed in the financial statements are
categorised within the fair value hierarchy, described as follows, based on the lowest level input that
is significant to the fair value measurement as a whole:
• Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities
• Level 2 – Valuation techniques for which the lowest level input that is significant to the fair
value measurement is directly or indirectly observable
• Level 3 – Valuation techniques for which the lowest level input that is significant to the fair
value measurement is unobservable
The Group measures derivative financial liabilities at fair value through profit and loss (refer note
1a(h)) on a recurring basis. The valuation of these derivatives involves the use of unobservable inputs
(level 3), which are detailed together with a reconciliation of changes in the fair value of these
liabilities throughout the period in note 17.
The carrying values of other financial assets and financial liabilities as disclosed in note 23
approximate their fair values.
Note 1b
Significant 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 and estimates on historical experience and on
other various factors it believes to be reasonable under the circumstances, the result which form the
basis of the carrying values of assets and liabilities that aren’t readily apparent from other sources.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 51 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 1b
continued
Significant accounting judgements, estimates and assumptions
Management has identified the following critical accounting policies for which significant judgements,
estimates and assumptions are made. Actual results may differ from these estimates under different
assumptions and conditions and may materially affect financial results or the financial position
reported in future periods.
Further details may be found in the relevant notes to the financial statements
(a)
Significant accounting judgements
Recovery of deferred tax assets
Deferred tax assets are recognised for deductible temporary differences only when management
considers that it is probable that future taxable profits will be available to utilise those temporary
differences. Significant management judgement is required to determine the amount of deferred tax
assets that can be recognised, based upon the likely timing and the level of future taxable profits
together with future tax planning strategies.
Impairment of non-financial assets other than goodwill and indefinite life intangibles
The Group assesses impairment of assets at each reporting date by evaluating conditions specific to
the Group and to the particular asset that may lead to impairment. These include technology,
economic and political environments and future product expectations. If an impairment trigger exists,
the recoverable amount of the asset is determined. Given the current uncertain economic
environment management considered that the indicators of impairment were significant enough and
as such these assets have been tested for impairment in this financial period, refer below.
(b)
Significant accounting estimates and assumptions
Impairment of non-current assets
The Group determines whether goodwill and intangibles with indefinite useful lives are impaired at
least on an annual basis. Further, the Group considers whether other non-current assets are impaired
whenever there is an indication that impairment may exist. This requires an estimation of the
recoverable amount of the cash generating units, using a value in use discounted cash flow
methodology, to which the goodwill and intangibles with indefinite useful lives are allocated.
An impairment loss of $Nil was recognised in the current year in respect of goodwill and brand (2018:
$3,797,413). The assumptions used in this estimation of recoverable amount and the carrying amount
of goodwill and intangibles with indefinite useful lives are discussed in note 9.
Revenue recognition – Course fees
The Group recognises the revenue earned from delivery of a course over the period of the course that
the service is provided. Where the duration of the course is extended this is recorded as contract
revenue on the statement of financial position. In calculating the amount of contract revenue,
consideration is also given to the probability of reversals and student refunds and the impact on the
level of income recorded.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 52 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 2
Operating Segments
An operating segment is a component of the Group that engages in business activities from which it
may earn revenues and incur expenses (including revenues and expenses relating to transactions
with other components of the same entity), whose operating results are regularly reviewed by the
entity's chief operating decision maker to make decisions about resources to be allocated to the
segment and assess its performance and for which discrete financial information is available.
The Group has organised its business into four separate units based on the products and services
offered – the Chief Operating Decision Makers (“CODM”), being the directors and executive
management of the Group, review the results on this basis.
The four reportable business segments of the Group are:
- Site Skills Training - Domestic which delivers vocational training and assessment services
through five training facilities located at Perth, Gladstone, Darwin, Landsborough and Logan.
At these locations our experienced team assesses, up-skills and trains industry experienced
candidates in the mining and processing, oil and gas, construction, camp services,
hospitality and logistic sectors.
- Site Skills Training - International operates a 300,000m2 facility at Clark Freeport Zone in
the Philippines allowing the company to deliver Australian standard training in a low cost and
controlled environment. This facility has the capacity to complete large scale residential
training programs customised to meet client specific requirements. This division also
incorporates Site WorkReady being the recruitment and assessment division for international
clients.
- Energy Services refers to the establishment of specialised energy training and services
delivered to the Oil and Gas industry.
- Tertiary Education delivers Diploma and certificate level courses at Site’s campuses in
Australia through the Site Institute brand and also English language courses and
conferences internationally through the TESOL Asia business.
The CODM monitors the operating results of its business units separately for the purposes of making
decisions about resource allocation and performance assessment. Segment performance is
evaluated based on operating profit/loss consistent with the operating profit/loss in the consolidated
financial statements. Group financing and corporate overheads are managed on a group basis and
not allocated to operating segments. Transfer prices between the operating segments are on an arm’s
length basis in a manner similar to transactions with third parties.
The following is an analysis of the revenue and results for the period, analysed by reportable
operating unit:
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 53 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 2
Operating Segments continued
Year ended 30 June 2019
Revenue from contracts with customers
Site Skills
Training
(Domestic)
$
Site Skills
Training
(International) Energy Services
$
$
Tertiary
Education
$
Total Segments
$
Corporate and
Eliminations
$
Total
$
Revenue from contracts with customers - external customer
12,866,083
12,137,035
3,235,102
2,614,754
30,852,974
60,316
30,913,290
Revenue from contracts with customers - inter-segment
-
521,336
403,915
-
925,251
(925,251)
-
Total segment revenue
12,866,083
12,658,371
3,639,017
2,614,754
31,778,225
(864,935)
30,913,290
Segment net operating (loss) before tax
(2,326,460)
134,956
37,966
75,658
(2,077,880)
(2,918,609)
(4,996,489)
Interest revenue
Interest expense
Depreciation and amortisation
EBITDA
-
(5,506)
(592,276)
(1,728,678)
11,784
(9,762)
(549,460)
682,394
82
(561)
(173,206)
211,651
-
(348)
11,866
(16,177)
54,317
(398,564)
66,183
(414,741)
(34,132)
(1,349,074)
(59,000)
(1,408,074)
110,138
(724,495)
(2,515,362)
(3,239,857)
Segment assets as at 30 June 2019
4,122,861
10,069,113
1,732,117
1,111,430
17,035,521
240,721
17,276,242
Segment liabilities as at 30 June 2019
2,803,973
4,823,425
313,137
713,977
8,654,512
5,239,607
13,894,119
Capital expenditure as at 30 June 2019
591,517
1,119,065
6,877
107,743
1,825,202
79,503
1,904,705
.
Year ended 30 June 2018
Revenue
Sales revenue - external customer
Sales revenue - inter-segment
Total segment revenue
Segment net operating (loss) before tax
Interest revenue
Interest expense
Depreciation and amortisation
EBITDA
Site Skills
Training
(Domestic)
$
Site Skills
Training
(International)
$
Energy Services
Tertiary
Education
Total Segments
Corporate and
Eliminations
$
$
$
$
Total
$
14,284,041
10,748,704
3,781,713
1,423,013
30,237,471
68,663
30,306,134
-
40,304
-
-
40,304
(40,304)
-
14,284,041
10,789,008
3,781,713
1,423,013
30,277,775
28,359
30,306,134
(943,529)
-
(9,201)
(744,364)
(189,964)
173,134
6,792
(7,813)
(524,781)
698,936
(5,245,824)
1,059
(25)
(646,162)
(4,600,696)
(260,403)
-
(44)
(16,401)
(243,958)
(6,276,622)
7,851
(17,083)
(1,931,708)
(4,335,682)
(3,106,695)
8,346
(37,293)
(68,416)
(3,009,332)
(9,383,317)
16,197
(54,376)
(2,000,124)
(7,345,014)
Segment assets as at 30 June 2018
4,178,592
8,761,877
748,775
1,116,961
14,806,205
995,107
15,801,312
Segment liabilities as at 30 June 2018
2,408,416
3,511,333
249,556
531,507
6,700,812
2,151,393
8,852,205
Capital expenditure as at 30 June 2018
712,650
536,341
9,936
27,545
1,286,472
71,762
1,358,234
The segment disclosures above do not include the discontinued operation. Refer to note 20 for more
information.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 54 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 2
Operating Segments continued
Reconciliation of loss
Segment loss
Inter-company management fees
Head office occupancy costs
Corporate employee benefits including Directors costs
Legal accounting and other professional fees
Travel costs
Other corporate costs
Corporate income
Group loss before tax from continuing operations
Reconciliation of assets
Segment operating assets
Corporate assets
Cash at bank
Security deposits
Intangibles
Other assets
Inter-segment receivables
Group operating assets
Assets of discontinued operations (note 20)
Total assets per statement of financial position
Reconciliation of liabilities
Segment operating liabilities
Corporate liab ilities
Corporate trade payables
Interest bearing debt
Other current financial liabilites
Other liabilities
Group operating liabilities
Liabilities of discontinued operations (note 20)
Total liabilities per statement of financial position
Disaggregation of Revenues
Consolidated Group
2019
$
2018
$
(2,077,880)
1,140,000
(76,482)
(2,432,113)
(142,271)
(128,883)
(896,105)
(382,755)
(4,996,489)
(6,276,622)
1,140,000
(160,348)
(2,804,049)
(340,361)
(199,611)
(779,031)
36,705
(9,383,317)
17,035,521
14,806,205
15,171
467,254
197,498
536,179
(975,381)
17,276,242
225,951
17,502,193
25,776
345,981
197,763
425,587
-
15,801,312
376,681
16,177,993
8,654,512
6,700,812
432,623
4,242,575
218,630
345,779
13,894,119
6,381,321
20,275,440
1,639,850
313,006
-
198,537
8,852,205
5,871,029
14,723,234
As disclosed in note 1a(o), the group derives its revenue from the transfer of services over time and at
a point in time. The following table provided a disaggregation of revenue by major revenue class and
by geographical location.
Year ended 30 June 2019
Revenue from contracts with customers - external
Course fees
Placement services
Government subsidies received
Project income
Other revenue
Total revenue from contracts with customers - external
Revenue from contracts with customers - inter segment
Total revenue from contracts with customers
Timing of revenue recognition
Goods transferred at a point in time
Services transferred over time
Total revenue from contracts with customers
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Australia
$
Asia
$
Corporate and
Eliminations
$
Total
$
14,077,635
-
1,867,431
19,648
89,040
16,053,754
1,300
16,055,054
9,360,865
2,727,917
-
2,425,842
284,596
14,799,220
923,951
15,723,171
-
-
-
-
60,316
60,316
(925,251)
(864,935)
23,438,500
2,727,917
1,867,431
2,445,490
433,952
30,913,290
-
30,913,290
-
16,055,054
16,055,054
15,782
15,707,389
15,723,171
14,251
(879,186)
(864,935)
30,033
30,883,257
30,913,290
Page 55 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 2
Operating Segments continued
Year ended 30 June 2018
Revenue from contracts with customers - external
Course fees
Placement services
Government subsidies received
Project income
Other revenue
Total revenue from contracts with customers - external
Revenue from contracts with customers - inter segment
Total revenue from contracts with customers
Timing of revenue recognition
Goods transferred at a point in time
Services transferred over time
Total revenue from contracts with customers
Note 3
Earnings per Share
Australia
$
Asia
$
Corporate and
Eliminations
$
Total
$
13,522,113
-
2,418,969
1,742,606
130,301
17,813,989
-
17,813,989
6,756,056
3,674,305
-
1,751,555
241,566
12,423,482
40,304
12,463,786
-
-
-
-
68,663
68,663
(40,304)
28,359
20,278,169
3,674,305
2,418,969
3,494,161
440,530
30,306,134
-
30,306,134
-
17,813,989
14,799
12,448,987
17,813,989
12,463,786
15,190
13,169
28,359
29,989
30,276,145
30,306,134
Consolidated Group
2019
2018
$
$
a) Earnings used in calculating earnings per share
For b asic and diluted earnings per share:
Net loss from continuing operations attributable to ordinary equity holders of the parent
Net loss attributable to ordinary equity holders of the parent
(5,082,800)
(4,742,968)
(9,547,913)
(6,042,212)
b) Weighted average number of shares
Weighted average number of ordinary shares for basic and diluted earnings per share
No.
686,183,949
No.
656,150,613
c) (Loss) / earnings per share (cents)
Loss per share from continuing operations attributable to the ordinary equity holders
of the parent
Loss per share attributable to the ordinary equity holders of the parent
(0.74)
(0.69)
(1.46)
(0.92)
There are no options outstanding at 30 June 2019 (Nil at 30 June 2018).
To calculate the EPS for discontinued operations the weighted average number of ordinary shares is
as per above. The following table provides the profit / (loss) amounts used.
Net profit /(loss) from discontinued operations attributable to ordinary equity holders
of the parent
339,832
3,505,701
Consolidated Group
2019
2018
$
$
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 56 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 4
Revenue from Contracts with Customers from Continuing Operations
Revenue from continuing operations
Revenue
Course fees
Placement services
Government subsidies received
Project income
Other revenue
Other Income
Fair value gain on embedded derivative
Note 5
Expenses from Continuing Operations
Employee benefits expense
Wages and salaries
Superannuation expense
Payroll tax and workers compensation
Changes in provisions for annual and long-service leave
Other employment expenses
Share-based payment expense
Other expenses
Legal, accounting and other professional fees
Travel & accommodation
Sales and marketing expense
Consultants cost
Impairment of intangibles
Impairment of receivables
Changes in the allowance for expected credit losses
Other
Finance costs
Interest expense - third parties
Interest expense - related parties
Facilities fee
Consolidated Group
2019
2018
$
$
23,438,500
2,727,917
1,867,431
2,445,490
433,952
30,913,290
20,278,169
3,674,305
2,418,969
3,494,161
440,530
30,306,134
116,498
-
Consolidated Group
2019
$
10,906,472
930,653
600,033
(10,268)
318,949
9,228
12,755,067
2018
$
11,881,800
1,014,779
704,746
112,126
256,208
60,000
14,029,659
1,073,304
1,029,442
1,757,962
841,168
-
-
(388,588)
1,267,196
5,580,484
624,546
1,027,316
1,169,603
779,257
3,797,413
495,573
-
1,112,039
9,005,747
24,451
382,191
8,099
414,741
23,061
26,515
4,800
54,376
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 57 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 6
Taxation
a) Income tax expense
The major components of income tax expense are:
Statement of comprehensive income
Current income tax
Current income tax charge
Adjustments in respect of current income tax of previous years
Deferred income tax
Relating to origination and reversal of timing differences
Income tax expense / (benefit) reported
in the statement of comprehensive income
b) Numerical reconciliation between aggregate tax expense
A reconciliation between tax expense and the product of accounting
Total before income tax
Accounting profit/(loss) before tax from continuing operations
Accounting profit/(loss) before tax from discontinued operations
Total before income tax
At the parent entity's statutory income tax rate of 30% (2018 - 30%)
Differential in overseas tax rate to Australian tax rate
Non-assessable income
Non-deductible expenses
Utilisation of previously unrecognised tax losses
Adjustments in respect of current income tax of previous years
Adjustments in respect of deferred tax in prior year
Impairment of intangible assets
Write back of Impairment of intangible assets
Derecognition of carried forward tax losses
Deferred tax asset not recognised
Aggregate income tax credit attributed to: Continuing operations
Aggregate income tax expense attributed to: Discontinued operations
Consolidated Group
2019
$
2018
$
92,984
-
(6,673)
86,311
88,851
73,579
2,166
164,596
(4,996,489)
(1,261,398)
(6,257,887)
(1,877,366)
(121,490)
-
123,778
(162,626)
(1,688,960)
-
-
-
-
2,211,745
(1,514,919)
86,311
(1,601,230)
(1,514,919)
(9,383,317)
3,588,746
(5,794,571)
(1,738,371)
147,363
-
116,279
-
73,579
(45,708)
1,139,224
(1,497,034)
132,082
1,920,227
247,641
164,596
83,045
247,641
A deferred tax asset has not been recognised for unused tax losses amounting to $7,372,483 (tax
effected: $2,211,745).
Following review of the historical taxation treatment for the revenue derived by the PP business,
management lodged amended income tax returns for the 2015, 2016 and 2017 income tax years
resulting in income tax refund for $1,688,960 being received in January 2019.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 58 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 6
Taxation continued
c) Deferred tax
Consolidated statement of
financial position
Consolidated statement of
profit or loss
2019
$
2018
$
2019
$
2018
$
Accrued expenses
Superannuation payable
Provision for leave balance
Provision for impairment of receivables
Provision for re-credits
Customer contracts
Losses available for offsetting against future taxable income
Other foreign entity deferrals
Deferred tax benefit
Net deferred tax assets
626,572
18,527
206,719
12,000
23,717
-
-
(11,606)
688,532
21,653
213,629
29,252
23,717
-
-
(17,532)
875,929
959,251
61,960
3,126
6,910
17,252
-
-
-
(8,191)
81,057
(171,813)
23,749
(29,017)
1,539
217,677
(106,538)
132,082
17,532
85,211
2019
$
959,251
(2,265)
6,673
(87,730)
875,929
2018
$
1,044,462
-
(2,166)
(83,045)
959,251
Note
7(a)
Consolidated Group
2019
$
2018
$
25,347,821
(21,304,563)
4,043,258
335,109
4,378,367
24,450,323
(21,671,453)
2,778,870
555,579
3,334,449
Reconciliation of net deferred tax asset /(liabilities)
As of 1 July
Opening balance adjustment
Tax income during the period recognised in profit or loss
Discontinued operations
As at 30 June
Note 7
Trade and Other Receivables
CURRENT
Receivables from contracts with customers
Allowances for expected credit losses
Other receivables
Total current trade and other receivables
Trade receivables includes an amount of $20,977,645, representing a portion of a total reconciliation
payment of $28,969,145 receivable from the Commonwealth Government Department of Education
and Training (DET) for services performed prior to 30 June 2017. The difference of $7,991,500 was
impaired in an earlier period, which should not be taken as an assertion by the Group that the Group
is not entitled to this amount.
In light of the uncertain circumstances with regard to the reconciliation payment, Management took
the decision to write down the full debtor value in the accounts at 30 June 2017, while maintaining the
position that the group was entitled to the full reconciliation amount. In December 2017, the Group
received $4,869,133 of the amount outstanding and was then advised by DET it would accept further
submissions from the Group for the balance.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 59 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 7
Trade and Other Receivables continued
Following the provision of these submissions, the Group was advised that DET had decided against
making the payment, without providing any legislative justification. The Group will pursue all
remedies available to it through the court process to compel the DET to pay the outstanding amount.
During the comparative year ended 30 June 2018 the provision was written back by $4,990,133
following tuition re-credits and the DET payment received as noted above.
The expected loss rate for this balance (refer below) has been set at 100% in light of the uncertain
circumstances with regard to the reconciliation payment. The loss allowance will be re-assessed as
the matter progresses and does not in any way alter the belief of the Board and Management that the
Group is entitled to the full reconciliation amount of $28,969,145 in full and that the monies are
legitimately due and payable under the relevant legislation as it then applied.
a) Allowance for expected credit losses
As described in note 1a(h), the group applies the simplified expected credit loss model prescribed in
AASB 9 to determine an allowance for expected credit losses on its receivables from contracts with
customers (trade receivables) and contract assets. To measure the expected credit losses, trade
receivables and contract assets have been grouped based on shared credit risk characteristics and
the days past due. The contract assets have substantially the same risk characteristics as the trade
receivables for the same types of contracts. The group has therefore concluded that the expected
loss rates for trade receivables are a reasonable approximation of the loss rates for the contract
assets.
The expected loss rates are based on the payment profiles for sales over a period of 3 years before
30 June 2019 and 1 July 2018 respectively and the corresponding historical credit losses experienced
within this period. The historical loss rates are adjusted to reflect current and forward looking
macroeconomic factors affecting the ability of the customers to settle the receivables. The group has
identified forecasts GDP growth conditions to be the most relevant factor, and accordingly adjusts the
historical loss rates based on expected change in this factor.
The tables below show the calculation of the expected credit loss provision at both 30 June 2019 and
1 July 2018.
Consolidated Group
Total
Trade receivables - Days past due
31-60 days
61-90 days
0-30 days
+91 days
Discontinued
Operation
30 June 2019
Expected credit loss rate
Estimated total gross carrying
amount at default
Expected credit loss
1 July 2018
Expected credit loss rate
Estimated total gross carrying
amount at default
Expected credit loss
0.7%
5.0%
10.0%
16.7%
25,347,821
21,304,563
1,564,176
10,793
1,073,953
53,698
402,556
40,256
1,329,491
222,171
20,977,645
20,977,645
0.7%
5.0%
10.0%
17.2%
24,450,323
21,199,556
1,907,852
13,133
402,448
20,122
159,307
15,931
1,003,071
172,724
20,977,645
20,977,645
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 60 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 7
Trade and Other Receivables continued
The closing loss allowances for receivables from contracts with customers and contract assets as at
30 June 2019 reconcile to the opening loss allowances as follows:
Opening Balance - calculated under AASB 139
Adjustment on initial application of AASB 9
Opening balance – calculated under AASB 9
Increase/(reversal) of loss allowance recognised in profit or loss
Amounts written off
Closing Balance
Consolidated Group
2019
$
2018
$
21,671,453
(471,897)
21,199,556
105,007
-
21,304,563
26,145,867
-
26,145,867
(4,420,769)
(53,645)
21,671,453
Other receivables are excluded from the above analysis as these represent balances due from
taxation authorities for which the expected loss rate is 0%.
b) Related party receivables
For terms and conditions of related party receivables refer to note 17.
c) Fair value and credit risk
Due to the short-term nature of these receivables, their carrying value is assumed to approximate their fair
value. The maximum exposure to credit risk is the fair value of receivables. Collateral is not held as
security, nor is it the Group’s policy to transfer (on-sell) receivables to special purpose entities.
At 30 June 2019, Group receivables, before allowance for expected credit losses, included one customer
that owed $20,977,645 (as noted above).
d) Foreign exchange and interest rate risk
Detail regarding foreign exchange and interest rate risk exposure is disclosed in note 23.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 61 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 8
Property, Plant and Equipment
Plant and equipment
Leasehold improvements
At cost
Accumulated depreciation
Net carrying amount - leasehold improvements
Capital works in progress
At cost
Computer equipment
At cost
Accumulated depreciation
Net carrying amount - computers
Furniture and fittings
At cost
Accumulated depreciation
Net carrying amount - furniture and fittings
Vehicles
At cost
Accumulated depreciation
Net carrying amount - vehicles
Total property, plant and equipment
Consolidated Group
2019
2018
$
$
9,123,658
(2,821,405)
6,302,253
8,343,301
(2,219,622)
6,123,679
1,555,369
444,813
1,321,729
(1,194,898)
126,831
1,226,899
(1,093,995)
132,904
4,504,353
(3,982,620)
521,733
4,203,950
(3,458,329)
745,621
778,509
(584,001)
194,508
747,014
(471,456)
275,558
8,700,694
7,722,575
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 62 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 8
Property, Plant and Equipment continued
(a)
Movements in Carrying Amounts
Movements in carrying amounts for each class of property, plant and equipment between the
beginning and the end of the current financial year:
Leasehold
Capital Works
Improvements
$
in Progress
$
Computers
$
Furniture &
Fittings
$
Vehicles
$
Total
$
6,548,983
41,172
8,476
(7,305)
(381,948)
(85,699)
6,123,679
20,492
42,139
-
(386,906)
502,849
6,302,253
158,952
666,751
(382,914)
-
-
2,024
444,813
1,152,581
(84,751)
-
-
42,726
1,555,369
218,512
84,307
1,045
(7,058)
(164,101)
199
132,904
78,480
14,918
-
(99,494)
23
126,831
892,534
105,834
161,560
(16,238)
(393,969)
(4,100)
745,621
174,217
3,125
(43,300)
(371,832)
13,902
521,733
184,163
54,599
147,574
(11,980)
(97,326)
(1,472)
275,558
-
-
-
(94,652)
13,602
194,508
8,003,144
952,663
(64,259)
(42,581)
(1,037,344)
(89,048)
7,722,575
1,425,770
(24,569)
(43,300)
(952,884)
573,102
8,700,694
Consolidated Group:
Balance at 30 June 2017
Additions
Transfers - in (out)
Disposals
Depreciation expense
Exchange rate differences
Balance at 30 June 2018
Additions
Transfers - in (out)
Disposals
Depreciation expense
Exchange rate differences
Balance at 30 June 2019
(b)
Finance Leases
The carrying value of vehicles held under finance leases and hire purchase contracts at 30 June 2019
was $173,397 (2018: $233,962). No additions of vehicles under hire purchase contracts were made
during the year (2018: $162,599) Leased assets and assets under hire purchase contracts are
pledged as security for the related finance lease and hire purchase liability.
(c)
Impairment Testing
Impairment testing was completed on the Site Skills Training – International cash-generating unit
(CGU) at 30 June 2019, to which $7,299,871 of the property, plant and equipment balance above is
allocated. The recoverable amount of the CGU was determined based on value-in-use calculations.
Value-in-use is calculated based on the present value of future cash flow projections over a five-year
period including a terminal value calculation.
The projected cash flows used to determine value-in-use reflected the latest budgets. Key inputs into
the impairment model included a pre-tax discount rate of 17%, annual revenue growth rate over the 5
year forecast period of 10%, annual EBITDA margin of 15%, and a terminal growth rate of 0%.
As a result of this analysis, management did not recognise an impairment charge.
The calculation of value in use for the CGU’s is most sensitive to changes in forecast revenue growth
and the discount rate. Removal of any average annual revenue growth rate or a decrease in the
annual EBITDA margin percentage to 10% would result in an impairment charge being recognised.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 63 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 9
Intangible Assets
Non-Current
Goodwill
Net carrying value
Training licences and course material
Cost
Accumulated amortisation
Net carrying value
Customer contracts
Cost
Accumulated amortisation
Net carrying value
Software development
Cost
Accumulated amortisation
Net carrying value
Total intangible assets
Consolidated Group
2019
2018
$
$
638,050
638,050
3,242,515
(2,598,845)
643,670
2,871,181
(2,267,606)
603,575
1,615,542
(1,615,542)
1,615,542
(1,615,542)
-
-
1,359,511
(1,132,015)
227,496
1,191,112
(973,672)
217,440
1,509,216
1,459,065
(a)
Reconciliation of carrying amounts at the beginning and end of the period
Movements in carrying amounts for each class of intangible between the beginning and the end of the
current financial year:
Goodwill
$
4,375,463
-
-
(3,737,413)
-
-
-
638,050
-
-
-
-
Training
Licences
Courses
$
684,871
258,787
24,921
-
(635)
(372,436)
8,067
603,575
335,105
-
(302,489)
7,479
Consolidated Group:
Balance at 30 June 2017
Additions
Transfers in
Impairments
Disposals
Amortisation expense
Exchange rate differences
Balance at 30 June 2018
Additions
Transfers in
Amortisation expense
Exchange rate differences
Balance at 30 June 2019
638,050
643,670
Customer
Contracts
$
352,943
-
-
-
-
(352,943)
-
-
-
-
-
-
-
Brand
$
Software
Development
$
Total
$
60,000
-
-
(60,000)
-
-
-
-
-
-
-
-
-
303,847
146,784
39,338
-
(2,000)
(270,529)
-
217,440
143,830
24,569
(158,343)
-
5,777,124
405,571
64,259
(3,797,413)
(2,635)
(995,908)
8,067
1,459,065
478,935
24,569
(460,832)
7,479
227,496
1,509,216
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 64 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 9
Intangible Assets continued
b)
Impairment
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 to sell and
value in use.
The recoverable amount of goodwill and brand name is determined based on value-in-use
calculations. Value-in-use is calculated based on the present value of future cash flow projections
over a five-year period including a terminal value calculation.
The cash-generating unit with a significant amount of goodwill is the Tertiary Education unit, as shown
in the table below:
CGU
Carrying amount
of goodwill
Tertiary
Site Skills Training
(Domestic)
2019
$
2018
$
2019
$
2018
$
441,015
441,015
197,035
197,035
Tertiary Education cash-generating unit
The Group used the cash-generating unit’s value-in-use to determine the recoverable amount. The
projected cash flows were updated to reflect the latest budgets and a pre-tax discount rate of 17% (30
June 2018: 16.6%) was applied. The terminal growth rate applied is 0% (30 June 2018: 0%).
As a result of this analysis, management did not recognise an impairment charge.
The calculation of value in use for the Tertiary Education CGU is most sensitive to the changes in
forecast gross margins and the discount rate. No reasonably possible change in forecast gross
margins or the discount rate applied would have resulted in an impairment of the CGU carrying value
at 30 June 2019.
Energy Services cash-generating unit
In the period to 30 June 2018, the business for Wild Geese International Pty Ltd changed such that
the Group sought to reassess impairment for the non-current assets (primarily goodwill) in the Energy
Services cash-generating unit. The Group used the cash-generating unit’s value-in-use to determine
the recoverable amount, which exceeded the carrying amount. The projected cash flows were
updated to reflect the latest budgets and a pre-tax discount rate of 17% was applied. The terminal
growth rate applied was 0%
As a result of the analysis, management recognised an impairment charge of $3,797,413 against
goodwill and brand in the year ended 30 June 2018. The impairment charge is recorded in other
expenses in the Statement of Comprehensive Income.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 65 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 10
Trade and Other Payables
Current
Unsecured liabilities
Trade payables
Employee related payables
Accruals
Other payables
Total trade and other payables
Non-current
Unsecured liabilities
Trade payables
Accruals
Total trade and other payables
Consolidated Group
2019
2018
$
$
3,509,922
776,783
1,715,062
78,355
6,080,122
2,573,229
437,178
1,640,375
8,322
4,659,104
Consolidated Group
2019
2018
$
$
4,581,310
1,013,773
5,595,083
4,581,310
1,013,773
5,595,083
Non-current trade payables and accruals balances include commission payable to agents on receipt
of the reconciliation payment receivable from the DET (see note 7).
The non-current accruals account also includes $475,352 representing executive STI bonuses
payable on receipt of the reconciliation payment receivable from the DET.
Amounts have been classified as non-current as the Group has no contractual obligation to settle the
liabilities unless payment of the outstanding receivable due from the Commonwealth Government as
per note 7 is received. Although the Group intends to pursue recovery of the outstanding receivable in
full, as such recovery action is at the discretion of the Group, the directors are satisfied that an
unconditional right of deferral exists for the liabilities until such time as the debtor is received.
(a)
Fair value
Due to the short-term nature of these payables, their carrying value is assumed to
approximate their fair value.
(b)
Related party payables
For terms and conditions relating to related party payables refer to note 17.
(c)
Interest rate, foreign exchange and liquidity risk
Information regarding interest rate, foreign exchange and liquidity risk exposure is set out in
note 23.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 66 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 11
Contract Liabilities
Consolidated Group
2019
$
2018
$
Contract liabilities
390,458
623,824
The amount of the contract liability recognised at the beginning of the period was recognised as
revenue during the 2019 year. All contract liabilities outstanding at 30 June 2019 are expected to be
recognised as revenue within the next twelve months.
As disclosed in note 1a(c)(i), comparative balances have been reclassified for consistency with
current period disclosures, resulting in unearned income of $623,824 recognised within trade and
other payables in the 30 June 2018 financial statements being reclassified as contract liabilities.
Note 12
Interest Bearing Debt
Current financial liabilities
Refer to note 15(d) for details of the unsecured related party debt facility.
Finance lease liability due within 12 months
Unsecured related party loans due within 12 months
Non-current financial liabilities
Finance lease liability
Unsecured related party loans
Consolidated Group
2019
$
103,612
38,907
142,519
2018
$
92,156
266,922
359,078
Consolidated Group
2019
$
2018
$
71,143
166,508
4,167,276
4,238,419
-
166,508
Movements in finance lease borrowings during the year are as follows:
Opening Balance
Assets acquired via finance lease
Repayments
Closing balance
2019
$
258,664
-
(83,909)
174,755
2018
$
179,720
162,599
(83,655)
258,664
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 67 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 13
Provisions
Current
Employee - annual leave
Other
Non-current
Provision for pension liability
Provision for long service leave
Provision for lease rental incentive
Movement in provisions
Movements in provisions are set out below:
At 30 June 2017
Arising during the year
Utilised/provision released
At 30 June 2018
Arising during the year
Utilised/provision released
At 30 June 2019
Consolidated Group
2019
2018
$
$
465,898
126,428
592,326
580,376
126,020
706,396
Consolidated Group
2018
2019
$
$
199,923
267,254
2,453,828
2,921,005
94,742
163,044
2,306,201
2,563,987
Lease Rental
$
2,157,076
152,553
(3,429)
2,306,200
154,927
(7,300)
2,453,827
Pension
Liability *
$
109,282
-
(14,540)
94,742
-
105,181
199,923
Long Service
Leave
$
104,068
58,976
-
163,044
104,211
-
267,255
Total
$
2,370,426
211,529
(17,969)
2,563,986
259,138
97,881
2,921,005
* The Group has an obligation in the Philippines to provide for the retirement obligations of staff after
5 years of service should that person reach retirement age.
(c) Lease Rental Incentive
The lease of the Clark facility included a three year rent free period which concluded in October 2012.
The lease agreement is for a period of 25 years with an option to renew for another 25 years. The
agreement includes an escalation in lease payments of ten per cent, compounded on every increase,
starting on the fourth year and every three years thereafter.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 68 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 14
Issued Capital
691,457,154 fully paid ordinary shares; 1,116,000 partly paid ordinary shares
(2018: 688,552,154 fully paid)
Cost of capital raising
(a) Ordinary Shares
30 June 2017 share capital
Share issue - 18 September 2017
Share issue - 21 September 2017
Share issue - 11 October 2017
Share buy back - 8 December 2017
Share issue - 14 December 2017
Share buy back - 25 January 2018
Transaction costs relating to capital raising
30 June 2018 share capital
Share issue - 8 March 2019
share buy back - 27 March 2019
30 June 2019 share capital
Consolidated Group
2019
$
2018
$
80,519,621
80,519,621
(2,434,337)
78,085,284
(2,434,337)
78,085,284
No. Shares
$
597,017,765
41,586,531
15,165,000
10,375,000
(10,857,142)
36,960,000
(1,695,000)
-
688,552,154
7,700,000
(4,795,000)
691,457,154
75,742,840
-
606,600
415,000
-
1,478,400
-
(157,556)
78,085,284
-
78,085,284
• On 18 September 2017, the Company completed the issue of 41,586,531 shares at $0.04 per share
in settlement of outstanding loans payable to Directors. Agreements for conversion of debt to equity
were signed prior to 30 June 2017, subject to the necessary shareholder approval which was granted
at an extraordinary general meeting of the Company on 15 September 2017. The financial effects
of this transaction, being a reduction to liabilities and an increase in share capital of $1,663,462,
were accounted for as at 30 June 2017 as the subsequent shareholder approval was considered to
be merely a governance exercise.
• On 21 September 2017 – the Company issued 15,165,000 shares under the Share Purchase Plan
at the issue price of $0.04 per share.
• On 11 October 2017 - the Company issued 10,375,000 shares under the Share Purchase Plan at
the issue price of $0.04 per share.
• On 8 December 2017 – the Company completed a buy-back of 10,857,142 shares issued under the
Employee Share Plan and sign on of shares forfeited by employees when they resigned from the
Group.
• On 14 December 2017 - the Company issued 36,960,000 shares under the Share Purchase Plan at
the issue price of $0.04 per share.
• On 21 January 2018 – the Company completed a buy-back of 1,695,000 shares issued under the
Employee Share Plan and sign on of shares forfeited by employees when they resigned from the
Group.
• On 8 March 2019 – the Company issued 7,700,000 employee loan shares, pursuant to the
Company’s employee share plan. Refer note 16 for further details on this share-based payment
arrangement.
• On 27 March 2019 – the Company completed a buy-back of 4,795,000 shares under the Employee
Share Plan and sign on shares forfeited by employees when they resigned from the Group.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 69 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 14
Issued Capital continued
b) Options
i.
ii.
For information relating to the Site Group International Limited employee option plan,
including details of options issued, exercised and lapsed during the financial year and the
options outstanding at year-end. Refer to Note 16: Share-based Payments.
No options were issued to key management personnel during the financial year.
c) Capital Management
Management control the capital of the Group in order to ensure that the Group can fund its operations
and continue as a going concern. There are no externally imposed capital requirements. Management
effectively manages the Group’s capital by assessing the Group's financial risks and adjusting its
capital structure in response to changes in these risks and in the market.
During 2019, the Group has not paid any dividends.
Note 15
Retained Earnings/ (Losses) and Reserves
(a) Movement in retained earnings/ (losses) and reserves
Balance 1 July
Net (loss) / profit for the period
Other comprehensive income / (loss)
Balance 30 June
(b) Other reserves
At 30 June 2017
Foreign currency translation
Share based payment
At 30 June 2018
Foreign currency translation
Share based payment
At 30 June 2019
(c) Nature and purpose of reserves
Share
based
payments
$
1,451,675
-
60,000
1,511,675
-
9,228
1,520,903
Consolidated Group
2019
2018
$
$
(78,712,583)
(4,742,968)
(58,171)
(83,513,722)
(72,724,863)
(6,042,212)
54,492
(78,712,583)
Total
$
Foreign
currency
translation
$
557,389 2,009,064
12,994
60,000
2,082,058
563,905
9,228
2,655,191
12,994
-
1,134,288
570,383
563,905
-
Foreign currency translation reserve
The foreign currency translation reserve records exchange differences arising on translation of a
foreign controlled subsidiary.
Share based payments reserve
The share based payments reserve is used to record the value of share based payments provided to
employees, including KMP, as part of their remuneration. Refer to note 16 for further details.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 70 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 16
Share Based Payments
The expense recognised for services received during the year is shown in the table below:
Share options expense
Expense/(write back) arising from equity-settled share-based payments
Employee services
Expense arising from the amortisation of employee sign on and bonus shares
Expense arising from the amortisation of the employee share plan
Total expense arising from share based payment transactions
Consolidated Group
2019
2018
$
$
-
-
-
9,228
9,228
-
60,000
60,000
(a) Employee share plan
In November 2011 the Shareholders approved the establishment of an Employee Share Plan that
would enable employees, directors and eligible associates to subscribe for shares in the Company.
Under the terms of the plan an eligible person is offered shares in the Company at a price determined
by the board with a corresponding interest free loan to assist the person to subscribe for the shares.
The shares are escrowed in two tranches with 50% being escrowed for a minimum of 12 months and
50% being escrowed for a minimum of 24 months. Subsequent to these minimum restriction periods,
the shares are available for release from escrow (i.e. a vested and exercisable option) on the
repayment of the loan, and subject to continuation of employment (including acting as an associate or
director) at the time of repayment.
For accounting purposes these shares are treated as if these were share options, as whilst the shares
have been issued to the employee their rights to access the shares are subject to both a time based
requirement (continued employment to escrow dates) and valuation uncertainty (share price exceeds
issue price at date of escrow release). Accordingly, shares issued under the plan are valued using a
Black Scholes Option Valuation model with the expense being recognised over the escrow period as
a share based payment. A summary of shares issued under the plan are below:
Outstanding at the beginning of the period
Granted during the period
Forfeited during the period
Expired during the period
Outstanding at the end of the period
Exercisable (vested)at the end of the period
2019
No. of shares
9,795,000
7,700,000
-
4,795,000
12,700,000
8,850,000
2019 Weighted
average
exercise price
$0.20
$0.04
2018
No. of shares
11,490,000
-
2018 Weighted
average
exercise price
$0.20
-
1,695,000
$0.20
$0.20
$0.10
$0.13
-
9,795,000
9,795,000
$0.20
$0.20
-
-
All shares issued prior to the current year are exercisable at 20 cents per share (5,000,000
shares),and have no remaining contractual life as their expiry date has passed prior to the start of the
comparative period. As these shares are to former and current directors, the board has elected to
leave these shares as currently exercisable until they are cancelled and bought back following
approval of shareholder at the next general meeting. A new issue of shares under the plan was
completed on 8 March 2019 on the following terms:
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 71 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 16
Share Based Payments continued
Employee Share Plan
Number of shares issued
Fair value
Price paid per share
Market price of shares at grant date
Expected volatility
Risk free interest rate
Dividend yield
Escrow period of shares
Agreement date 29 March 2018
Issued 8 March 2019
Tranche 1
escrowed for
12 months to
29 March 2019
Tranche 2
escrowed for
24 months to
29 March 2020
3,850,000
3,850,000
$24,357
$0.040
$0.036
52.25%
2.60%
0%
$37,378
$0.040
$0.036
52.25%
2.60%
0%
12 months
24 months
The 7,700,000 shares issued on 8 March 2019 have a remaining contractual life of 2.75 years (expiry
date of 29 March 2022).
(b) Employee sign-on and bonus shares
From time to time the Group issues shares to employees as an incentive for accepting employment
with the group. Shares are issued at the volume weighted average price (VWAP) of the Group’s stock
trading for the period prior to issuance. Shares are subject to escrow periods which vary depending
on the contracts with the employee, and the value of the shares is recognised as an expense over the
escrow period subject to continuing employment with the Group. No such shares have been issued in
either the current or comparative financial years.
(c) Share-based payments to service providers
No share-based payment arrangements were entered into with service providers in the current period
or prior period.
Note 17
Related Party Transactions
(a) The Group's main related parties are as follows:
i.
ii.
Entities exercising control over the Group:
The ultimate parent entity, which exercises control over the group, is Site Group International
Limited which is incorporated in Australia.
Key Management Personnel:
Any person(s) having authority and responsibility for planning, directing and controlling the
activities of the entity, directly or indirectly, including any director (whether executive or
otherwise) of that entity are considered key management personnel.
For details of disclosures relating to remuneration of key management personnel, refer to
Note 19.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 72 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 17
Related Party Transactions continued
(b) Transactions with related parties:
Transactions between related parties are on normal commercial terms and conditions no more
favourable than those available to other parties unless otherwise stated.
(c) Amounts outstanding from related parties
As disclosed in the remuneration report, Directors and key management personnel participate in the
employee share plan whereby they are offered shares in the Company with a corresponding interest
free loan. The loan from the Company must be repaid prior to the shares being sold or transferred by
the employee. The below table details the Director and key management personnel participation:
Name
Shares
Issued
Share Issue
Price
Total Value
Loan from
Company
Vern Wills
Nicasio Alcantara
Craig Dawson
2,000,000
1,000,000
1,000,000
$0.20
$0.20
$0.04
400,000
200,000
40,000
400,000
200,000
40,000
(d) Other transactions with related parties
During the current and comparative periods, the group made use of an unsecured loan facility with
Wayburn Holdings Pty Ltd, a company associated with Managing Director and CEO Mr Vernon Wills.
The loan facility limit was $2.35m to 31 December 2016, and $1.32m from that point, repayable on the
earlier of collection of the receivable from the Commonwealth Department of Education and Training
(refer note 7) or February 2018. To date, revised terms have not been agreed for the facility and the
outstanding balance as disclosed below is repayable at call. Interest is charged on the loan at a fixed
rate of 7% per annum.
Movements in the loan balance during the year are as follows:
Opening Balance
Drawdowns
Interest accrued during the year
Principal repayment through issuance of shares*
Principal repayments (cash)
Interest repayments (cash)
Closing Balance
30-Jun-19
$
266,922
-
14,102
-
(233,189)
(8,928)
38,907
30-Jun-18
$
580,842
-
25,900
(246,000)
-
(93,820)
266,922
*Details of shares issued in settlement of outstanding loan amounts are as follows:
Date
24/09/2017
Share
Number of
Shares
Price
6,150,000 $0.04
Amount
$
246,000
The share price at which the shares were issued represents the fair value of the shares at the date of
issue and reflective of the external raising to other shareholders.
During the current and comparative periods, the group made use of unsecured loan facilities with
Non-Executive Directors and their related parties as follows.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 73 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 17
Related Party Transactions continued
Stuart Andrew Pty Limited
Amounts were borrowed under facilities with Stuart Andrew Pty Ltd, a company associated with Peter
Jones. The loans were repayable at call and interest charged on the loans was at a fixed rate of 10%
per annum.
Movements in the loan balances during the period were as follows:
Opening Balance
Drawdowns
Interest accrued during the year
Principal repayments (cash)
Interest repayments (cash)
Closing Balance
Punta Properties Inc.
30-Jun-19
$
-
-
-
-
-
-
30-Jun-18
$
57,539
45,000
1,229
(45,000)
(58,768)
-
On 21 June 2018, the Company announced a financing facility of US$4million with Punta Properties,
a company associated with Non-Executive Director Nicasio Alcantara. Repayment of funds drawn
under the facility will be via cash or equity to be issued at the last issue price of 4 cents per share
subject to approval of shareholders. The potential settlement of the loan balance (which is variable,
based on the loan being denominated in a currency other than the group’s functional currency of
Australian dollars) through issuance of shares represents an embedded derivative liability. Interest
charged on the loan will be at a fixed rate of 10% per annum.
On initial drawdown of the loan during the period, the group recognised the following derivative
financial liabilities:
Date of
drawdown
Drawdown
amount
(USD)
Drawdown
amount
(AUD)
Value of
conversion
option
No of
securities
Exercise
Price
Share price
@
drawdown
Risk
Free
rate
Total Value
Stock
volatility
Expected
maturity
$
$
9/07/2018
1,000,000
1,346,149
30/09/2018
31/10/2018
23/11/2018
28/03/2019
11/04/2019
22/05/2019
24/06/2019
500,000
200,000
200,000
200,000
200,000
400,000
200,000
692,770
275,562
274,010
279,003
276,855
577,284
285,347
$
0.0020
0.0037
0.0069
0.0067
0.0034
0.0045
0.0026
0.0024
33,653,725
17,319,250
6,889,045
6,850,254
6,975,072
6,921,373
14,432,097
7,133,685
$
$
$
67,397
64,832
47,332
45,814
23,587
31,460
37,745
16,961
335,128
0.04
0.04
0.04
0.04
0.04
0.04
0.04
0.04
0.020
0.026
0.028
0.033
0.028
0.031
0.027
0.027
2%
2%
2%
2%
2%
2%
2%
2%
52.25%
1/07/2020
52.25%
1/07/2020
52.25%
1/07/2020
52.25%
1/07/2020
52.25%
1/07/2020
52.25%
1/07/2020
52.25%
1/07/2020
52.25%
1/07/2020
The conversion options were valued at inception using a Black Scholes model, with inputs as
documented in the table above. Derivatives are carried at fair value through profit or loss, and fall
within level 2 of the fair value hierarchy. The fair value of the above options at 30 June 2019 was
$218,630. The following inputs were applied in deriving the fair value of these options:
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 74 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 17
Related Party Transactions continued
Date of
valuation
Drawdown
amount
(USD)
Drawdown
amount
(AUD)
Value of
conversion
option
No of
securities
Total Value
Exercise
Price
Share price
@ valaution
Risk
Free
rate
Stock
volatility
Expected
maturity
30/06/2019
$
2,900,000
$
$
4,131,201
$
0.0021169 103,280,020
$
218,630
$
0.04
$
0.027
2%
52.25% 1/07/2020
A gain of $116,498 has been recognised (refer note 4) on revaluation of the embedded derivative at
30 June 2019.
Movements in the financing facility during the period were as follows:
Opening Balance
Drawdowns (cash)
Interest accrued during the year
Recognition of embedded derivative
Foreign currency movement
Closing balance
2019
$
-
4,006,980
368,090
(335,128)
127,332
4,167,276
2018
$
-
-
-
-
-
In addition, the Company and Punta Properties agreed to a performance based incentive to develop
and execute an optimisation plan for the Group’s Philippines assets, associated businesses and
international expansion. This incentive is payable on the total project value achieved from the
optimisation plan at 5% of the total project value achieved. Should the plan reach a total project value
of US$30m a further 5% fee of the gross value is payable to Mr Alcantara. There is no retainer
applicable or payable to this agreement. The agreement will be subject to shareholder approval at the
next general meeting of shareholders.
The incentive represents a contingent liability to the group, and the group’s obligation in respect of the
incentive will only be confirmed by the occurrence or non-occurrence of a future obligating event,
being the execution of an optimisation plan. It is not considered possible to reliably estimate the
amount of the possible obligation at this point in time, having regard to the degree of uncertainty in
such estimation. Uncertainties relate to the amount of timing of any outflow include the type of
optimisation transaction, time for such transaction occurring, and estimated total project value.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 75 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 18
Controlled Entities
Subsidiaries of Site Group International Limited:
Site Group Holdings Pty Ltd
Site Education Australia Pty Ltd
Site WorkReady Pty Ltd
Study Corp Australia Pty Ltd (Formerly Site Lab ourhire Pty Ltd )
Site Skills Group Pty Ltd
Site Skills Academy Pty Ltd
Site WorkReady (Philippines) Pty Ltd
Axis Training Group Pty Ltd
Romea Consulting Pty Ltd
Site Group international Pte Ltd
Competent Project Management Sdn Bhd
Productivity Partners Pty Ltd
Wild Geese International Pty Ltd
Site Institute Pty Ltd (Formerly Innovium Pty Ltd)
* Percentage of voting power is in proportion to ownership
Principle activities
Country of
Incorporation
Percentage Owned
(%)*
2019
2018
Holding company
Holding company
Labour services
Holding company
Education and training
Education and training
Holding company
Education and training
Education and training
Competency development
Competency development
Education and training
Oil & Gas consultancy
Education and training
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Singapore
Malaysia
Australia
Australia
Australia
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Note 19
Interests of Key Management Personnel (KMP)
Refer to the Remuneration Report contained in the Directors’ Report for details of the remuneration
paid or payable to each member of the Group’s key management personnel for the year ended 30
June 2019.
The totals of remuneration paid to KMP of the Group during the year are as follows:
Short-term employee benefits
Post-employment benefits
Other long term benefits
Share-based payments
Termination benefits
Consolidated Group
2019
2018
$
$
1,076,536
892,930
43,501
26,027
6,253
5,247
4,781 -
33,654
1,159,944
-
928,985
Note 20
Discontinued Operations
In December 2016, the Group publicly announced the closure of Productivity Partners Pty Ltd’s
business, and the closure of VET FEE-HELP related campuses. The closure was a direct result of the
Commonwealth Government passed legislative changes.
With Productivity Partners Pty Ltd being classified as a discontinued operation, the company is no
longer included in the ‘tertiary education’ segment of the segment note. The results of Productivity
Partners Pty Ltd for the year are presented below.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 76 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 20
Discontinued Operations continued
Revenue
Expenses
Operating income
Impairment of intangible assets
Write back of provision for impairment of debtors
Profit / (loss) before tax from discontinued operations
Tax benefit / (expense)
Profit / (loss) after tax from discontinued operations
2019
$
-
2018
$
-
(1,261,398)
(1,261,398)
(1,401,367)
(1,401,367)
-
-
(1,261,398)
1,601,230
339,832
-
4,990,113
3,588,746
(83,045)
3,505,701
The major classes of assets and liabilities of Productivity Partners Pty Ltd as at 30 June 2019 are as
follows:
Assets
Property, plant and equipment
Debtors
Cash & short term deposits
Deferred tax asset
Other assets
Liab ilities
Creditors
Interest bearing debt
Provisions
Current tax liabilities
The net cash flows incurred by Productivity Partners Pty Ltd are as follows:
Operating
Investing
Net cash outflow
Earnings per share
Basic and diluted (loss) / profit for the year from
discontinued operations (cents per share)
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
2019
$
-
35,650
(1,894)
158,733
33,462
225,951
2018
$
5,643
34,393
(1,896)
246,463
92,078
376,681
(6,297,448)
(4,818)
(79,055)
-
(6,381,321)
(5,782,041)
(9,933)
(79,055)
-
(5,871,029)
2019
$
2018
$
(682,991)
682,993
2
3,716,941
(3,728,499)
(11,558)
2019
2018
0.05
0.53
Page 77 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 21
Cash Flow Information
Reconciliation of net (loss) / profit after tax to net
cash flows from operations
Loss after income tax expense
Non cash items
Depreciation and amortisation
Foreign exchange loss
Share based payments expense
Impairment for non current assets
Fair value gain on embedded derivative
Net Interest accrued / (paid) on loans
Net profit / (loss) on sale of plant & equipment
Change in assets and liabilities
Decrease / (Increase) in receivables
Decrease / (Increase) in inventory
Decrease / (Increase) in prepayments
(Decrease) / Increase in payables and accruals
Increase / (Decrease) in contract liabilities
Increase / (Decrease) in provisions
Decrease / (Increase) in deferred tax assets
Increase / (Decrease) in current tax liabilities
Net cash used in operating activities
Note 22
Commitments and Contingencies
(a) Operating Lease Commitments
Non-cancellable operating leases contracted for but not capitalised
Payable — minimum lease payments
not later than 12 months
between 12 months and 5 years
greater than 5 years
Consolidated Group
2019
2018
$
$
(4,742,968)
(6,042,212)
1,413,716
2,033,252
114,432
9,228
-
60,000
-
3,797,413
(116,498)
340,915
4,890
-
(32,326)
(15,575)
(2,976,285)
(199,448)
(846,660)
4,370
113,732
1,164,188
(233,366)
4,061
83,322
5,999
(2,680,639)
403,341
4,745
127,044
534,110
(607,591)
(395,539)
85,141
(679,627)
(727,824)
Consolidated Group
2019
2018
$
$
1,884,134
5,049,071
6,884,947
13,818,152
1,601,689
3,488,644
7,156,935
12,247,268
The Group has an operation through a subsidiary located in the Philippines. On 30 October 2009 the
subsidiary entered into a lease agreement covering a parcel of land where its office and education
facilities are located. The lease agreement is for a period of 25 years with an option to renew for
another 25 years. The agreement includes an escalation in lease payments of ten per cent,
compounded on every increase, starting on the fourth year and every three years thereafter.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 78 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 22
Commitments and Contingencies continued
In 2016 the Group entered into a four-year commercial lease for the head office location. This lease
has a life of four years with a renewal option included in the contract, there are no restrictions
imposed by entering into these leases. In addition, the Group has entered into leases for training
facilities at Belmont (Perth), Gladstone, Landsborough and Darwin. Competent Project Management
has a two-year lease at Johor in Malaysia. All of the leases grant options for renewal at expiration of
the current lease.
(b) Finance lease
The Group entered into finance leases for the acquisition of motor vehicles during the year. These
leases have renewal terms but no purchase options or escalation clauses. Future minimum lease
payments under the finance lease together with the present value of the net minimum lease payments
are as follows:
Payable — lease payments
not later than 12 months
between 12 months and 5 years
(c) Legal claim contingency
2019
2018
Minimum
Payments
Present Value
of payments
Minimum
Payments
Present Value
of payments
$
$
$
$
101,598
82,624
184,223
103,612
71,143
174,754
106,466
177,757
284,223
92,156
166,508
258,663
As noted in the Directors report, the ACCC has commenced civil proceedings against Site,
Productivity Partners and two former executives in relation to enrolment practices of Productivity
Partners. An estimate of the financial effect of the matter has not been disclosed as it is not yet
practicable to determine such an estimate, having regard to the timing of proceedings (the case is not
to be heard until the end of the next financial year), and the prevailing uncertainty surrounding the
outcome of these proceedings.
Note 23
Financial Risk Management
The group’s financial instruments consist mainly of deposits with banks, receivables from contracts
with customers, trade payables, leases and borrowing facilities. The totals for each category of
financial instruments, measured in accordance with AASB 9 as detailed in the accounting policies to
these financial statements, are as follows:
Financial assets
Financial assets at amortised cost
Cash and cash equivalents
Loans and receivables
Other non-current financial assets
Total financial assets
Financial liabilities
Financial liabilities at amortised cost
Current
— Trade and other payables
— Borrowings
Non-current
— Trade and other payables
— Interest bearing debt
Financial liabilities at fair value through profit & loss
— Other financial liabilities
Total financial liabilities
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Note
Consolidated Group
2019
2018
$
$
7
10
12
10
12
606,148
4,378,367
105,748
5,090,263
1,533,437
3,334,449
147,237
5,015,123
6,080,122
142,519
4,659,104
359,078
5,595,083
4,238,419
5,595,083
166,508
218,630
16,274,773
-
10,779,773
Page 79 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 23
Financial Risk Management continued
(a) Liquidity Risk
The tables below reflect an undiscounted contractual maturity analysis for financial liabilities. Cash
flows realised from financial assets reflect management’s expectation as to the timing of realisation.
Actual timing may therefore differ from that disclosed. The timing of cash flows presented in the table
to settle financial liabilities, reflect the earliest contractual settlement dates and do not reflect
management’s expectations that banking facilities will be rolled forward.
Within 1 Year
1 to 5 Years
Over 5 Years
Total
2019
$
2018
$
2019
$
2018
$
2019
$
2018
$
2019
$
2018
$
Financial liabilities due for payment
Trade and other payables
Borrowings - Principal
- Interest
Other non-current financial liabilities - Principal
- Interest
Other financial liabilities
Total expected outflows
6,080,122
92,922
47,583
-
-
-
6,220,627
4,659,104
324,315
49,073
-
-
-
5,032,492
5,595,083
5,595,083
-
-
-
-
4,212,082
372,945
218,630
10,398,740
166,508
11,249
-
5,772,840
Financial assets - cash flows realisable
Cash and cash equivalents
Loans and receivables
Other non-current financial assets
Net (outflow) / inflow
606,148
4,378,367
1,533,437
3,334,449
-
-
4,984,515
(1,236,112)
4,867,886
(164,606)
-
-
-
-
105,748
105,748
(10,292,992)
147,237
147,237
(5,625,603)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
11,675,205
92,922
47,583
4,212,082
372,945
218,630
16,619,367
10,254,187
324,315
49,073
166,508
11,249
-
10,805,332
606,148
4,378,367
105,748
5,090,263
(11,529,104)
1,533,437
3,334,449
147,237
5,015,123
(5,790,209)
The outflow indicated above within 1 year will be funded via the capital raising of 3,750,000 completed
subsequent to year end disclosed in note 25 and drawdowns on the $US4million loan facility available
and unused at 30 June 2019, the terms of which are disclosed in note 17. The outflow in subsequent
years is attributable to financial liabilities which will only require settlement where a corresponding
inflow of economic benefits is received in settlement of fully impaired receivables, as disclosed in note
7.
(b) Interest rate risk
The Group's exposure to market interest rates relates primarily to the Group's holding of cash as
borrowings are under fixed interest agreements. The following table depicts the sensitivity of the
Group’s results to reasonably possible changes in interest rates.
Financial assets
Cash and cash equivalents
Consolidated Group
2019
2018
$
$
606,148
1,533,437
Post Tax Profit
higher / (lower)
Other Comprehensive
Income
higher / (lower)
2019
$
4,243
(2,122)
2018
$
10,734
(5,367)
2019
$
-
-
2018
$
-
-
Consolidated
+ 1% (100 basis points)
- .5% (50 basis points)
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 80 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 23
Financial Risk Management continued
(c) Foreign currency risk
Foreign currency risk is the risk that the fair value of the future cash flows of a financial instrument will
fluctuate because of change in foreign exchange rate. The Group is exposed to foreign currency risk
on cash balances held in US Dollars (USD). At 30 June 2019 the Group had total cash and cash
equivalents denominated in USD of USD 117,693 (2018: USD 547,263).
The following table shows the foreign currency risk on the financial assets and liabilities of the
Group’s operations denominated in currencies other than the functional currency of the operations.
Post Tax Profit
higher / (lower)
2019
$
2018
$
Other Comprehensive
Income
higher / (lower)
2019
$
2018
$
Consolidated
USD Rate+15%
USD Rate-15%
20,715
(15,311)
95,880
(70,868)
-
-
-
-
(d) Price risk
The group is not materially exposed to price risk.
(e) Credit risk
Credit risk arises from the financial assets of the Group, which comprise cash and short-term
deposits, receivables from contracts with customers, other receivables, and quoted and unquoted
financial instruments. The Group’s exposure to credit risk arises from potential default of the
counterparty, with a maximum exposure equal to the carrying amount of the financial assets (as
outlined in each applicable note).
The Group does not hold any credit derivatives to offset its credit exposure.
The Group trades only with recognised, creditworthy third parties, and as such collateral is not
requested nor is it the Group’s policy to securitise its receivables from contracts with customers and
other receivables. In addition, receivable balances are monitored on an ongoing basis with the result
that the Group’s experience of bad debts has not been significant.
The group determines an allowance for expected credit losses at each reporting date. Details of this
allowance and the basis on which it has been determined are outlined in note 7.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 81 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 24
Auditors’ Remuneration
On May 30, 2018, Pitcher Partners were appointed as auditors for the Group. This appointment
follows the resignation of Ernst & Young, and ASIC’s consent to the resignation in accordance with
s329(5) of the Corporations Act 2001.
Remuneration of Pitcher Partners as current auditor of the parent entity for:
— auditing or reviewing the financial report
— taxation services
Rumuneration of EY as former auditor of the parent entity for:
— auditing or reviewing the financial report
— taxation services
Remuneration of entities affiliated with Pitcher Partners for:
— auditing or reviewing the financial statements of subsidiaries
Remuneration of other EY as former auditors of subsidiaries for:
— auditing or reviewing the financial statements of subsidiaries
Remuneration of other auditors of subsidiaries for:
— auditing or reviewing the financial statements of subsidiaries
— taxation services
Consolidated Group
2019
2018
$
$
100,000
32,450
75,000
-
-
-
-
79,310
32,180
111,490
16,681
-
-
25,327
10,382
11,975
22,357
10,147
12,261
22,408
Note 25
Events after the Reporting Period
In August 2019 the company successfully completed the issue of 93,750,000 shares under a private
placement at 4 cents per share to raise $3,750,000.
Other than as disclosed elsewhere in this report, there have been no significant events after balance
date.
Note 26
Parent Company Information
The following information has been extracted from the books and records of the parent, Site Group
International Limited, and has been prepared in accordance with the Accounting Standards.
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 82 of 92
Notes to the Financial Statements for the Year Ended 30 June 2019 continued
Note 26
Parent Company Information continued
Statement of Financial Position
Assets
Current assets
Non-current assets
Total Assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net Assets
Equity
Issued capital
Accumulated losses
Share based payments reserve
Total Equity
Statement of Comprehensive Income
Total loss of the parent entity
Total comprehensive loss of the parent
2019
$
2018
$
20,307,215
11,172,699
31,479,914
18,258,860
11,676,784
29,935,644
1,689,605
4,525,900
6,215,505
2,051,569
101,704
2,153,273
25,264,409
27,782,371
67,612,562
(43,729,621)
1,381,468
25,264,409
67,612,562
(41,291,325)
1,461,134
27,782,371
(26,398,041)
(26,398,041)
(27,154,604)
(27,154,604)
The Parent entity has no commitments to purchase property, plant and equipment and has no
contingent liabilities.
Note 27
Company Details
The registered office of the company is:
Site Group International Limited
Level 4, 488 Queen Street,
Brisbane Qld 4000
The principal places of business are:
Site Skills Training:
• 219 Forestry Road, Landsborough, Qld. 4550
• 17-19 South Tree Drive, Gladstone, Qld. 4680
• 72-80 Belgravia Street, Belmont, WA. 6104
• 1 Campion Road, East Arm NT 0822
• 1-5 Nestor Drive, Meadowbrook, QLD 4131
• Centennial Road, Clark Freeport Zone, Pampanga, Philippines 2023
Competent Project Management
• 112, Robinson Road #8-01, Singapore 068909
• 17G, Jalan Hijauan 3, Horizon Hills, 79100 Nusajaya, Johor
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 83 of 92
Directors' Declaration
In accordance with a resolution of the directors of Site Group International Limited, I state that:
1. In the opinion of directors:
a)
the financial statements and notes of Site Group International Limited for the financial year
ended 30 June 2019 are in accordance with the Corporations Act 2001, including:
i.
ii.
giving a true and fair view of the Group’s financial position as at 30 June 2019 and of
its performance for the year ended on that date; and
comply with Accounting Standards and the Corporations Regulations 2001; and
b)
the financial statements and notes also comply with International Financial Reporting
Standards as disclosed in Note 1a (a); and
c) subject to the matters discussed in Note 1a (b) there are reasonable grounds to believe that
the Company will be able to pay its debts as and when they become due and payable.
2. This declaration has been made after receiving the declarations required to be made to the
directors by the chief executive officer and chief financial officer in accordance with section 295A
of the Corporations Act 2001 for the financial year ended 30 June 2019.
On behalf of the Board
Vernon Wills
Director
Brisbane, 30 August 2019
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 84 of 92
Independent Auditor’s Report to the Members of Site Group International Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Site Group International Limited (“the Company”) and its
controlled entities (“the Group”), which comprises the consolidated statement of financial position as at
30 June 2019, the consolidated statement of comprehensive income, the consolidated statement of
changes in equity and the consolidated statement of cash flows for the year then ended, notes to the
financial statements including a summary of significant accounting policies, and the directors’
declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
(a)
(b)
giving a true and fair view of the Group’s financial position as at 30 June 2019 and of its
financial performance for the year then ended; and
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants “the Code” that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
Key Audit Matter
Application of the going concern assumption
Refer to note 1a(b) going concern
The Directors have concluded that in
their opinion there are reasonable
grounds to believe that the Group has
the ability to pay its debts as and
when they fall due and realise the
value of the assets in the ordinary
course of business.
Accordingly they have prepared the
financial statements on a going
concern basis as disclosed in note
1a(b).
to
of
basis
the
the
The going concern assumption is
of
fundamental
preparation
financial
statements. Assertions made by the
Directors in forming their conclusion,
including forecast cash flows and
unused borrowing facilities, are key
elements of this assessment and
considerable audit attention was
directed to verifying these.
Accordingly, our consideration of this
matter and the related disclosures is
considered to be a key audit matter.
Australian
Key Audit Matter
Impairment testing for non-current assets
Refer to note 1b, note 8(c), and note 9(b)
Impairment testing for goodwill is
required to be completed annually
under
Accounting
Standard AASB 136 Impairment of
Assets. This standard also requires
impairment testing to be conducted
for other non-current assets where
there is an indicator that those assets
may be impaired. Impairment testing
was completed over non-current
assets with a combined value of
$7.884m.
the Group’s
Impairment testing for non-current
assets is a key audit matter due to the
percentage of
total
assets subject to impairment testing
(45%), and the degree of estimation
and assumptions (as disclosed in
note 8(c) and note 9(b)) required to be
made by
the Group, specifically
concerning discounted cash flows.
How our audit addressed the key audit matter
Our procedures included, amongst others:
Obtaining an understanding of the entity level controls in
place directed at ensuring the Group continues to operate
as a going concern, and evaluating the design and
implementation of those controls;
Evaluating whether the Directors’ conclusions regarding
the going concern assumption were supported by
management’s going concern assessment, including cash
flow forecasts;
Agreeing the cash flow forecast used in the going concern
assessment to the FY20 budget;
Assessing key inputs into the cash flow forecast by
comparing them to historical actual results, assumptions
and estimates used elsewhere in the preparation of the
financial statements, and customer commitments,
contracts, or other available
information supporting
forecast cash flows;
Confirming the amount of commitments for subscription of
capital received by the group subsequent to balance date;
Considering the historical reliability of the Group’s cash
flow forecasting process;
Considering the range of cash flow sensitivities to the
conclusion reached by the directors;
Assessing the possible mitigating actions identified by
management in the event that actual cash flows are below
forecast, including verification of unused financing facilities
to loan agreements; and
Assessing the adequacy of the disclosures made by the
Directors regarding the going concern assumption and
available financing.
How our audit addressed the key audit matter
Our procedures included, amongst others:
Obtaining an understanding of the controls over the
valuation of non-current assets, and evaluating the design
and implementation of those controls;
Checking
the Board
the mathematical accuracy of
approved FY20 cash flow forecasts and methodology of
the impairment model;
Confirming consistency of
the
impairment
testing
calculations and inputs applied by the group with the
requirements of AASB 136;
Assessing the key assumptions within the impairment
testing calculations including forecast cash flows, growth
rates, discount rates and terminal values;
Applying our knowledge of the business and corroborated
our work with external information where possible;
Performing sensitivity analysis in respect of the key
assumptions and assessing the potential impact of
reasonably possible change to those assumptions; and
Assessing the adequacy of disclosures.
Pitcher Partners is an association of independent firms.
An Independent Queensland Partnership ABN 84 797 724 539. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities.
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2019, but does not include the financial
report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true
and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and
for such internal control as the directors determine is necessary to enable the preparation of the financial
report that gives a true and fair view and is free from material misstatement, whether due to fraud or
error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the [Group] or to cease
operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the Group’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s
report to the related disclosures in the financial report or, if such disclosures are inadequate, to
Pitcher Partners is an association of independent firms.
An Independent Queensland Partnership ABN 84 797 724 539. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities.
modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of
our auditor’s report. However, future events or conditions may cause the Group to cease to
continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events in
a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group audit. We remain solely
responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included on pages 19 to 26 of the directors’ report for the
year ended 30 June 2019. In our opinion, the Remuneration Report of Site Group International Limited
for the year ended 30 June 2019 complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration
Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express
an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
Auditing Standards.
PITCHER PARTNERS
NIGEL BATTERS
Partner
Brisbane, Queensland
30 August 2019
Pitcher Partners is an association of independent firms.
An Independent Queensland Partnership ABN 84 797 724 539. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities.
Shareholder Information
1
Twenty Largest Shareholders
(i) Ordinary Shares Inclusive of Escrowed Ordinary Shares
As at 20 August 2019, there are 771,391,154 ordinary shares and an additional 12,700,000 ordinary
shares subject to escrow restrictions.
The names of the twenty largest holders of ordinary shares including the ordinary shares in escrow
are listed below:
Name
NATIONAL NOMINEES LIMITED
ARMADA TRADING PTY LIMITED
MR VERNON ALAN WILLS + MS JILLAINE PATRICE WILLS
WAYBURN HOLDINGS PTY LTD
CAMERON RICHARD PTY LTD
MR VERNON ALAN WILLS + MS JILLAINE PATRICE WILLS
LINWIERIK SUPER PTY LTD
SMITHLEY SUPER PTY LTD
CITICORP NOMINEES PTY LIMITED
JGC ASSETS PTY LTD
DBS VICKERS SECURITIES (SINGAPORE) PTE LTD
STUART ANDREW PTY LTD
JGC ASSETS PTY LTD
MYALL RESOURCES PTY LTD
MR GARY LINTON + MRS CHERYL LINTON
NICASIO ALCANTARA
THE SUMMIT HOTEL BONDI BEACH PTY LTD
MR GRANT HARRY O'KEEFE + MRS CATHERINE MARIA O'KEEFE
DCEC PTY LTD
JETAN PTY LTD
(ii) Ordinary Shares
No. of
Ordinary
Shares Held
% of Issued
Capital
147,529,561
18.82%
50,000,000
44,140,703
41,108,142
37,797,730
29,414,188
21,000,000
19,990,000
18,443,683
16,746,700
16,676,766
14,682,068
12,581,201
11,449,056
10,200,000
9,371,325
7,637,368
6,452,745
6,390,176
6,250,000
6.38%
5.63%
5.24%
4.82%
3.75%
2.68%
2.55%
2.35%
2.14%
2.13%
1.87%
1.60%
1.46%
1.30%
1.20%
0.97%
0.82%
0.81%
0.80%
The names of the twenty largest holders of fully paid ordinary shares are listed below:
Name
NATIONAL NOMINEES LIMITED
ARMADA TRADING PTY LIMITED
MR VERNON ALAN WILLS + MS JILLAINE PATRICE WILLS
WAYBURN HOLDINGS PTY LTD
CAMERON RICHARD PTY LTD
MR VERNON ALAN WILLS + MS JILLAINE PATRICE WILLS
No. of
Ordinary
Shares Held
% of fully
paid
shares
147,529,561
19.13%
50,000,000
44,140,703
41,108,142
37,797,730
29,414,188
6.48%
5.72%
5.33%
4.90%
3.81%
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 89 of 92
Shareholder Information continued
Name
No. of
Ordinary
Shares Held
% of fully
paid shares
LINWIERIK SUPER PTY LTD
SMITHLEY SUPER PTY LTD
CITICORP NOMINEES PTY LIMITED
JGC ASSETS PTY LTD
DBS VICKERS SECURITIES (SINGAPORE) PTE LTD
STUART ANDREW PTY LTD
JGC ASSETS PTY LTD
MYALL RESOURCES PTY LTD
MR GARY LINTON + MRS CHERYL LINTON
NICASIO ALCANTARA
THE SUMMIT HOTEL BONDI BEACH PTY LTD
MR GRANT HARRY O'KEEFE + MRS CATHERINE MARIA O'KEEFE
DCEC PTY LTD
JETAN PTY LTD
(iii) Escrowed Shares
21,000,000
19,990,000
18,443,683
16,746,700
16,676,766
14,682,068
12,581,201
11,449,056
10,200,000
8,371,325
7,637,368
6,452,745
6,390,176
6,250,000
2.72%
2.59%
2.39%
2.17%
2.16%
1.90%
1.63%
1.48%
1.32%
1.09%
0.99%
0.84%
0.83%
0.81%
The names of the top twenty holders of the escrowed shares are listed below:
Name
No. of
Escrowed
Shares Held
% of
escrowed
shares
MR VERNON ALAN WILLS
NICASIO ALCANTARA
CRAIG ANTHONY DAWSON
SHAUN SCOTT
DARRYL SOMERVILLE
BRETT MCPHEE
ISMAIL TAHIR
JASON ANFIELD
NOEL CHENEY
MICHAEL WALLACE
MIKE COSTELLOE
NEIL COSTELLOE
SUDHHER GOVINDPILLAI
SHAAGUL HAMEETH
MR JARROD PETER BELCHER
MS KATIE HURSE
MR JAMIE VERNON WILLS
SITI SUZANA BT BASRI
JAYSHEN RAMANAH
MR BERESFORD PAUL ROBERTSON
2,000,000
1,000,000
1,000,000
1,000,000
1,000,000
750,000
600,000
500,000
500,000
500,000
400,000
400,000
400,000
400,000
300,000
300,000
300,000
250,000
250,000
250,000
15.75%
7.87%
7.87%
7.87%
7.87%
5.91%
4.72%
3.94%
3.94%
3.94%
3.15%
3.15%
3.15%
3.15%
2.36%
2.36%
2.36%
1.97%
1.97%
1.97%
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 90 of 92
Shareholder Information continued
(iii) Partly Paid Shares
There are 1,116,000 partly paid shares, paid to $0.01, held by eight individual shareholders. $0.24 per
share may be called up in the event of winding up the company.
The names of the holders are listed below:
Name
BARON INVESTMENTS PTY LIMITED
BARON NOMINEES PTY LTD
QUEVY HOLDINGS PTY LTD
M B HUNNIFORD
ESTATE LATE PETER GAME
ESTATE LATE PETER AYLWARD GAME
P C TOOMEY
R TOOMEY
Total of partly paid shares issued
2
Distribution of Equity Securities
Analysis of numbers of holders by size of holding:
No of partly
paid shares
held
% of
Partly
Paid
Shares
488,376
400,000
195,624
24,000
2,000
2,000
2,000
2,000
1,116,000
43.76%
35.84%
17.53%
2.15%
0.18%
0.18%
0.18%
0.18%
100%
(i) Fully paid ordinary shares
Distribution
Number of Holders
Number of Shares
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
Greater than 100,000
Totals
83
55
74
176
43,258
159,784
663,992
8,183,492
257
775,040,628
645
784,091,154
(ii) Partly paid shares, paid to $0.01
Distribution
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
Greater than 100,000
Totals
Number of Holders
Number of Shares
-
4
-
1
3
8
-
8,000
-
24,000
1,084,000
1,116,000
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 91 of 92
Shareholder Information continued
(iii) Escrowed ordinary shares
Distribution
Number of Holders
Number of Shares
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
Greater than 100,000
Totals
(iv) Unmarketable parcels
-
-
-
-
15
20
-
-
600,000
12,100,000
35
12,700,000
Minimum
parcel size
Holders
Shares
Minimum $500 parcel at $0.045 per
share
11,112
216
910,388
3
Voting Rights
The voting rights attaching to each class of equity securities are set out below:
Ordinary shares: Subject to any rights or restrictions for the time being attached to any class
of shares, at a meeting of shareholders each shareholder entitled to vote may vote in person
or by proxy or attorney or, being a corporation, by representative duly authorised under the
Corporations Law, and has one vote on a show of hands and one vote per fully paid share on
a poll.
4
Substantial Shareholders
Substantial shareholder notices lodged with the Company:
Substantial Shareholder
Number of Shares
Mr Vernon Alan Wills, Ms Jillaine Patrice Wills and
Wayburn Holdings Pty Ltd
EGP Capital Pty Ltd
Peter Jones, Helen Jones, Cameron Richard Pty
Ltd and Stuart Andrew Pty Ltd
Armada Trading Pty Ltd
Milford Asset Management Limited
124,395,630
107,700,000
56,819,466
50,000,000
39,829,561
Site Group International Limited and Controlled Entities
Financial Year Ended 30 June 2019
Page 92 of 92