B i d | A n n u a l R e p o r t 2 0 2 0 2020 Annual Report Helping business do bills better Trading name of BidEnergy (ASX: BID) Churn 3% 1% Year on Year improvement (YOY) Expected group revenue $12.6M up $5.7M Year on Year (82%) Net upsell 10% (improved 4% YOY) FY Annualised rebate revenue $4.4M up $2.1M YOY (91%) We operate across Australia, New Zealand, the USA & the United Kingdom. Our platform offers a complete utility spend management solution that combines intelligent bill management automation and industry expertise to help multi‑site businesses minimize cost while maximising their control over the complex utility spend category. CONTENTS C Corporate directory 10 Our story so far 2 Helping businesses do bills better 12 Chairman’s letter 4 Our business model 6 Existing operations, support and services team 8 Global overview 14 Managing director’s letter 18 Board and Key Executives 20 Financial report IBC Corporate directory 20 Highlights Annualised subscription revenue $8.2M up $3.6M Year on Year (78%) Meters 147,900 up 62,700 Year on Year (74%) Share of revenue 53% Overseas 47% AUS Clients 128 (up 36) ASR CAGR 81% Overall CAGR 66% Jun 16 Sep 16 Dec 16 Mar 17 Jun 17 Sep 17 Dec 17 Mar 18 Jun 18 Sep 18 Dec 18 Mar 19 Jun 19 Sep 19 Dec 19 Mar 20 Jun 20 Expected Annualised Subscription Revenue Annualised Rebate Revenue 13,000,000 12,000,000 11,000,000 10,000,000 9,000,000 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 1 Helping businesses do bills better Bid’s focus through FY20 has been the build‑out of our Utility Bill capabilities across four key solution sets, positioning the business as a leading global solutions provider to many and varied enterprises, large and small. 2 new Energy retailer contracts completed in FY20 with a further 3 additional paid pilots adding more than $1.0M in new ASR Utility Bill Management Utility Bill Portal Improve data integrity, bill validation, streamline the procurement process, and reduce the overall category bottom line. Reduce your cost to serve, cost to acquire, improve client experience, and get closer to the customer with Bid’s Utility Bill Portal. Bid’s digitized Utility Bill Management (UBM) is the only energy management platform with full Robotic Process Automation (RPA), capable of processing thousands of utility bills per minute. Bid’s Utility Bill Portal is a perfect solution for water utilities, and telecommunication companies looking to digitalise their platforms or client journey and gain a competitive edge by improving their end‑user client experience. Core subscription product with good growth Over FY20, more than 30 new clients are benefiting from the Utility Bill Management platform, 15 of these were welcomed in the June quarter alone. These enterprise multi‑sites clients remain our key focus across all global geographies. Good traction – helping Energy Retailers get closer to their customers Marquee clients – Origin Energy and Momentum added in Australia, and with pilots already underway in the UK, the business sees solving large scale client data challenges a core focus and new revenue driver for FY21. 2 Bid Annual Report 2020 There are more than 800,000 small businesses in Australia that could benefit from an RPA driven bill management service. Better rates are at the core of Bid’s Utility Bill Concierge solution $4.4M in annualised rebate revenues Utility Bill Concierge Utility Rebates Driving on‑line acquisitions for residential focused B2C clients such as iSelect and SME targeted acquisition campaigns for Energy retailers like TOTAL gas & power (UK), our Utility Bill Concierge extends our Enterprise capability into mass markets for SME’s and Residential customers. Utility Bill Concierge is able to replace manual and call‑centre focused operating models with web based end‑to‑end self‑service RPA driven capabilities, and these services can drive down energy costs for end users, leveraging existing energy procurement, bill validation and bill exception capabilities. Increasing our reach into Global SME Mass Market. Leveraging the capabilities of Utility Bill Concierge in FY21, Bid intends to increase our global reach further into the mass SME market. Comprehensive rebate administration services for energy efficiency. Available to clients across the United States and Canada, Bid’s Rebates services can eliminate the complex and time‑intensive rebate acquisition process, from early‑stage guidance during CapEx budgeting through to pre‑approvals, site inspections, final applications and check expediting. Strong organic growth with opportunities to cross sell Utility Bill Management Our USA team in Philadelphia continue to deliver with substantial gains in rebate revenues. Throughout FY20, a number of Fortune 500 companies started using our services. The team are achieving success cross‑selling to these clients to drive uptake in Utility Bill Management services with a number of new clients and acceleration of SAAS revenue. The USA offers a very large and less sophisticated market, where RPA can make a huge difference. working with many 3 Our business model Utility Bill Portal Utility Bill Concierge Utility Bill Management Utility Rebates es vic r e s t r e p x e n a h c i y l p p u s y t i l i t U T I C P R O C E SS AUTOMATIO N (R P A ) O B O R s Sit e Bills DATA C o n t r a c t s INTEGRITY D A TABASE O F R E D R O C C O N s Network Ta r r i f TINUOUS DATA V E R I F I C a t a D al v Inter N T I O A Bill Parsing & Validation Energy Procurement Bill Exceptions & Analytics Bill Payments & Bill Payment Files 4 Bid Annual Report 2020 Bid provides complex customers of all shapes and sizes with improved data integrity across a wide variety of utility bills. Our Robotic Processing Automation (RPA) delivers Utility Bill Management Solutions, trusted by many to automate manual processes, improve data visibility, integrity and control. This accuracy increases peace of mind and the ability to make smarter, more agile business decisions, especially when managing essential services in highly volatile markets. Delivering a compelling benefit to customers 5 Existing operations, support and services team Bid does more than just automating your bill stream, with our robotic capabilities through our global leading RPA platform. We love our robots and have over 120 robotic workers as virtual staff members, completing over 2 million tasks per week, they are supported by 72 human specialists across our global geographies that take our service to the next level. The robots do the heavy lifting leaving our people to focus on all things specialist across a range of responsibilities. 120 robotic workers as virtual staff members 6 Bid Annual Report 2020 Onboarding • Data collection • Site list creation • Inbox management • Data requests • Data requests follow up • Buyer set up • Account list creation • Onboarding weekly updates • Unparsed Bills (from historical upload) • Bill quarantine (from historical upload) • Parser quarantine (from historical upload) Client Services (Global Helpdesk) • Postal segregation • Bill without accounts • Tender transfer • Roll in/Roll out • Complex client/retailer resolutions • Bill import/LOA issues • Invoice not on platform • Disconnection notices • Overdue Notice • Bill on closed sites/final bill • Unparsed – site not found • Payment extension • Meter access email • E‑billing setup • Interruption notices • Refunds and credits • Manual Bill for warding Billing and Meter Data • Bill collection • Missing bills • Cyborg parsing • Meter data collection and parsing • Allocation on unparsed Payments • Payment inbox management • Payment file creation • Payment file QA • CW Payments • Accrual reporting Tenders, Validations and Tariff Reviews • Tariff data collection and maintenance • Cost avoidance reporting • Billing enquiry management • Validation threshold management • Tender management • Contracts management • Mark to market analysis • Budgeting • Bill quaratine (ongoing bill stream) 7 Global overview 92% revenue growth to $4.8M with underlying positive EBITDA contribution USA Strong first 9 months across rebates and UBM, with transitory COVID‑19 impacts in the last quarter The USA saw substantial growth across both core revenue streams, driven by marquee rebate clients, and further Utility Bill Management client additions. Significant progress has been made, state by state, with the automation of Bill collection and data parsing with ever‑increasing numbers of robotic workers covering electronic PDF’s and more recently the ability to read paper bills via OCR parsing. Recent onboarding has seen bills under management in the USA more than double, albeit it that we are at a very early stage in such a large and opportunity‑rich market. Much awaits us. 8 Bid Annual Report 2020 United Kingdom TPI successes The UK market is unique, more than 80% of all energy spend is managed via third‑party independent energy brokers (TPI’s). Bids initial strategy has been to provide solutions to the leading market participants, specifically bill collection, validation and bill exception management. We have been successful with a number of large TPi’s, who are now selling our solution to their own multi‑site client base and emerging new client opportunities. This now sees us working with indirect sales channels. We continue to work with major utility retailers, and are gaining traction with other UK based, global multi‑site solution providers, and starting to target UK based multi‑site clients direct as we build our internal sales capability. 900M+ Global Smart Meters 147,900 under Bid management $4.4M Revenue Europe Australia/NZ Expanding into Europe with existing clients Our emerging business relationships with major UK brands and TPI’s, are also allowing us to follow their expansion into the European market. Many UK TPI’s already manage European utility bills, this enables us to grow our reach into these markets too. Opening these new markets will not be capital intensive, rather development effort to automate bill streaming via new RPA workers to read bills for each utility retailer is required. Recent core tech advancements in auto translations and multiple commodity rates of measure nuances, country by country ensures we are uniquely positioned to provide a global solution, that is not capital intensive, does not have any language barriers, nor does it require any geographic collocation with resources. ANZ… Strong client growth, driving global benchmark Australia’s client growth accelerated through the final quarter of FY20, with 13 new enterprise clients, and over $1.0M in new ASR growth. As our brand becomes better known, we are being included in more RFPs, which is further supported by winning more well known client brands. Australia has also supported the global development team (GDT) initiatives such as Utility Retailer Portals, cultivated locally, but are exported globally providing the benchmark for other geographic opportunities. 9 Our story so far From small beginnings, Bid has evolved into a fast growth, marketplace challenger, disrupting global incumbents through its unique ability to manage 100’s of thousands of bills across multiple countries at the speed and accuracy, only our cloud‑based RPA platform is powered to deliver. December 2016 Signs BP‑ANZ Platform launched in the US Acquires Real Win Win (USA Rebate business) Passes 8,000 meters under management 2015 June 2015 Signs Cotton On Passes 4,000 meters under management 2016 June 2016 First listed on the ASX Passes 5,000 meters under management 2017 June 2017 Expansion into the UK with BP client contract Passes 9,000 meters under management December 2017 Passes 10,000 meters under management 10 Bid Annual Report 2020 June 2019 Signs Carbon Numbers, Catalyst Commercial and LG in the UK Signs Aqua America in the US Partners with Simble solutions, UCR, to help BidBilly reach SME customers in UK Origin Pilot commences Passes 85,000 meters under management June 2018 Passes 15,000 meters under management Signs Optus Signs Salvation Army 2018 2019 December 2018 Signs Joann in the USA. First 49 State SaaS Customer in the USA Signs Cushman & Wakefield Passes 37,000 meters under management December 2019 Launches first UtilityBill Portal with OriginEnergy, one of Australia’s largest energy retailers Passes 130,000 meters Annualised rebates revenue grows past $3M A record growth quarter with 16 new client additions 2020 June 2020 Signs Momentum Energy for Utility Bill Portal Delivered Total Gas & Power Customer Acquisition tool Launched iSelect bill upload solution 147,900 meters Rebate revenues reach $4.4M total Expected Group Revenue at $12.6M 11 Chairman’s letter Dear Shareholder It gives me pleasure to present the 2020 Annual Report for BidEnergy (now Bill Identity, or “Bid”). Whilst working through various challenges during the last 12 months, Bid has continued to deliver on its strategy of creating a global Utility Bill Management enterprise solution driven by its proprietary robotic process automation (RPA) technology platform. Under the stewardship of Managing Director Guy Maine, Bid has been actively growing its footprint globally and FY20 was another year of significant progress. Year on year revenue increased by 77%, with subscription fee revenue up 66%, and Bid finished the year with 128 clients, up nearly 40%. Due to the level of investment to grow our customer base in new geographies this year, Bid reported a loss of $6.9M, similar to the loss of $6.6M posted in FY19 but more meaningful given the progress we have made over the past 12 months. Among the highlights in FY20 was a three‑year agreement with Origin Energy, as well as Momentum Energy (Hydro Tasmania) signing on for our solution for its commercial and industrial (C&I) client base. We secured new clients in the US and UK, including working with a large global energy company as it rolls out electricity retailing in the UK next year, and launching an online customer acquisition tool for Total Gas & Power in the UK. We launched in new territories including Germany and Hungary; secured 36 net new multi‑site clients globally and grew our revenue to $9.4M, despite operating against a backdrop of COVID‑19. With this momentum in place, we are confident of achieving an even stronger performance in the year ahead, bolstered by a strong cash balance of $8.3M. We thank our shareholders for their support during the year, including participating in a $5.1M placement and $1.6M share purchase plan. We see a tremendous opportunity for growth, particularly in the large US market, and are executing a strategy to capitalise on our first‑mover advantage there. Under the stewardship of Managing Director Guy Maine, Bid has been actively growing its footprint globally and FY20 was another year of significant progress. Year on year revenue increased by 77%. 12 Bid Annual Report 2020 Placement Share purchase plan $5.1M & $1.6M funds enabling Bid to execute on global expansion plans I thank our outgoing chairman Andrew Dyer, who recently retired from his role, as well as my fellow Board members for their contribution to Bid. My fellow board members & I are very pleased to welcome David Hancock to the board as a Non‑executive Director. David brings over 30 years of broad experience in financial services and technology to the company, including his most recent role as I would also like to thank Management and Staff for their tireless efforts over the past 12 months, particularly when working remotely and helping our customers through a difficult operating period. With an ever growing global customer pipeline, we can expect another busy and productive year for Bid as the company continue to leverage its powerful platform, and I hope you share that journey with us. Geoff Kleemann Interim Chairman My fellow board members & I are very pleased to welcome David Hancock to the board as a Non‑executive Director. David brings over 30 years of broad experience in financial services and technology to the company. Executive Director at Afterpay where he was involved in scaling the business globally. The Company is now undertaking a global search for a suitably skilled Chairman to help lead Bid through its next phase of growth. Year on year, Bid’s revenue increased by 77% 13 Managing director’s letter Dear Shareholder I would like to begin by thanking my team for their extraordinary efforts, especially through COVID‑19 related lockdowns which have seen the team operate from home, in all geographies, since March 2020. They are to be commended for their resilience, determination and focus and are to be credited for the strong revenue growth performance we achieved. They have my sincere thanks. Looking back on 2020, whilst it has been a challenging period for our company, we did achieve important breakthroughs in several areas. Following through on our strategy to invest further in the business to facilitate growth, particularly in the first half of FY20, we are now seeing positive signs of accelerating sales and revenue growth across all our markets. This is evidenced by the fact we now handle more than $1.4 billion of energy and commodity spend for our clients and have become tightly integrated in their business operations. More importantly with the recent announcement with JLL for one of the world largest global banks, from October 2020 we will be operating in more than 37 countries. This make us truly global! With this growth momentum, we changed our trading name from BidEnergy to “Bill Identity”, or b.id (Bid) for short, across Australia, USA and UK. This rebranding better reflects our current offerings and growing market opportunities. In the USA, for example, we now manage bills for a range of commodities other than Energy; Water bills, land taxes, Waste and Telecommunications as a starter. We want to be known for more than just Energy. The new branding and website, www.billidentity.com, has allowed our Company to improve its sales channels and clearly communicate its customer value propositions. Bid is building a business on its unique robotic process automation (RPA) cloud based platform, which gives our clients greater control over their energy and commodity spend. With RPA becoming more broadly accepted and understood, we are confident we can further grow our client base as customers become more aware of how they can use this technology to their advantage. In addition, the low churn rate of 3% achieved in FY20 demonstrates that once we sign clients, they tend to stay with us. With COVID‑19, whilst we saw some transitory impacts in the second half, it has accentuated the need for enterprise large and small, to tackle change and realise the benefits of outsourced automation as both a cost reduction strategy and business improvement initiative. We think further tail winds assisting acceptance will become apparent as more companies adopt this game changing technology. Looking back on 2020, whilst it has been a challenging period for our company, we did achieve important breakthroughs in several areas. Following through on our strategy to invest further in the business to facilitate growth, particularly in the first half of FY20, we are now seeing positive signs of accelerating sales and revenue growth across all our markets. 14 Bid Annual Report 2020 Bid is building a business on its unique robotic process automation (RPA) cloud based platform, which gives our clients greater control over their energy and commodity spend. Annualised Subscription Revenue CAGR of 81% ASR CAGR 81% Overall CAGR 66% 13,000,000 12,000,000 11,000,000 10,000,000 9,000,000 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 Jun 16 Sep 16 Dec 16 Mar 17 Jun 17 Sep 17 Dec 17 Mar 18 Jun 18 Sep 18 Dec 18 Mar 19 Jun 19 Sep 19 Dec 19 Mar 20 Jun 20 Expected Annualised Subscription Revenue Annualised Rebate Revenue Total Expected Group Revenue of $12.6M achieved by the end of FY20. Bid’s total operating revenue grew to $9.4M in FY20, a 77% year on year increase on the FY19 total of $5.3M. This growth was achieved through the combination of growth in Bid’s subscription fee revenue up 66% to $4.9M, together with strong USA‑based energy rebate revenues which contributed $4.5M of revenue (FY19: $2.4M). This was delivered through significant growth in new client contracts in Australia and overseas, as well as recurring revenue from existing clients who took up additional commodities and platform services. After providing for income tax, Bid’s consolidated loss amounted to $6.9M (FY19: $6.6M) with underlying EBITDA* loss increasing 5% to $4.9M. Through the first half of FY20 we invested in our people to ensure that we are well positioned to capture increased opportunities that are becoming more apparent. We completed our team build in the UK and added to our salesforce, product development and operations teams to execute and deliver on these growing opportunities. 15 Managing director’s letter (cont’d) We successfully raised $5.1M (before costs) through share placements from sophisticated and institutional investors and $1.6M through a share purchase plan from eligible shareholders, and these funds allowed Bid to accelerate its expansion in the USA, UK and European markets through the investment highlighted above and to service a growing and emerging portfolio of large UK‑based customers, and the even larger opportunity the USA represents. Operating Across 37 countries From October 2020, Bid will be operating across 37 countries During the year, we launched our first “white label” solution for the Facility Management industry with Cushman and Wakefield and their 17 Australian based clients, and our platform was white labelled through our agreement with Origin Energy, which saw our technology providing services to over 14,500 important Commercial & Industrial (C&I) clients in another “first” with our Utility Bill Portal solution. Bid demonstrated growth across multiple geographies. In Australia, we scored important new contract wins with iSelect, Origin Energy, Momentum Energy and several other large Australian enterprises. Our Origin Energy portal rollout successfully launched in mid‑February, with all accounts now active, and the first full monthly billing completed in March 2020. Phase 2 of the rollout commenced and was completed in the 2nd half of FY20 with additional features to support Origin’s broker community, together with other portal enhancements. 16 Bid Annual Report 2020 In the UK, our focus on energy brokers (TPI) delivered several new important clients, including a large broker that took on Bid’s full‑service capabilities for significant meter coverage. Operations under this contract are set to launch through the first half of FY21. In addition, Bid launched an online customer acquisition tool, working with Total Gas & Power to create an online pricing solution for small businesses of which the first phase has been deployed and is now live in the UK market. In addition, Bid will pilot an e‑billing solution for a large global energy company to cover its electricity retailing rollout in the UK. Bid signed an agreement to produce PDF bills to support a large global company to rollout as an energy retailer in the UK market. The agreement covers 12 months of a paid pilot program prior to an expected rollout in 2021. As a result of these successes, the business is now certain that its focus on four core revenue pillars will facilitate upside growth and scale in FY21 and beyond. Utility bill Management for enterprise and Facilities management clients, Utility Bill Portal for Energy retailer solutions such as Origin, Utility Bill Rebates in the USA, and finally our Utility Bill Concierge for the SME addressable marketplace. The team are ready to now grow these revenue streams across multiple global markets given the proof points already delivered. Globally, from the UK we have expanded into Europe, signing an agreement with leading European energy consultancy Core Energy Services to launch services in Hungary in June 2020, utilising our unique RPA cloud‑based platform for up to an initial 1,000 sites over 12 months. Alongside this, Bid is working with an existing partner to progressively rollout services in the German market. Bid’s RPA platform has been trained to read different languages on utility bills, allowing Bid to entertain new non‑English geographic expansion. Bid recently optimised its RPA platform to read scanned bills, which solves the manual workflow issue associated with countries such as the USA and within Europe, where many retailers still issue paper‑based utility bills. Given the agility our platform provides our client base, we were able to recontract a number of energy supply agreements for them, some delivering substantial annual savings in the millions of dollars, and for one particular client in the tens of millions. In the US, our team is executing well on our strategy announced in CY19 after we developed a pipeline of multi‑site opportunities, with a first mover advantage. Developing robotic workers that can decipher many unique bill formats for thousands of energy retailers across the US accurately and efficiently will provide an unparalleled automated service that is not yet seen there. We secured several important initial regional contract wins through the 2nd half in the US however as the US represents such a large market opportunity for Bid, across all states, we expect to achieve many more in the year ahead. Of course, all of this was achieved amid the global pandemic, which, as I mentioned previously, saw our staff operating remotely since early March. With our focus on ensuring existing clients continued to be well serviced, we also made sure to help customers reduce their costs in energy and commodity spend. Given the agility our platform provides our client base, we were able to recontract a number of energy supply agreements for them, some delivering substantial annual savings in the millions of dollars, and for one particular client in the tens of millions. As clients of ours know, because their bill data is live in the cloud, accurate and up to date, you can act immediately on market fluctuations, and we were pleased to do so when the energy market dropped suddenly. There have been transient impacts on the business due to COVID‑19, with the June quarter seeing a delay in cash receipts from customers. The closure of many US offices during the June quarter also impacted our ability to execute new UBM contracts that remain in our pipeline, however these are viewed only as delays rather than lost business. With the US now in recovery mode, we expect US sales momentum to start its rebound. With the past year of investment completed, and operating conditions expected to improve moving forward, we are ready to execute on our strategy to achieve a greater market share – both in Australia and internationally – in FY2021 Guy Maine Managing Director 17 Board and Key Executives Geoff Kleemann Experience and expertise: Mr Kleemann commenced his career at Deloitte, and subsequently completed approximately twenty years as a senior executive in a listed environment, as Chief Financial Officer for Crown Limited, Publishing and Broadcasting Limited, Woolworths Limited and Pioneer International Limited. Other current directorships: Independent Non‑Executive Director of Domain Holdings Australia Limited (ASX: DHG) Former directorships (last 3 years): None Interests in shares: 201,725 fully paid ordinary shares Interests in options: 259,933 unlisted options (which includes 51,725 Class L Options that expire on 8 November 2020) Interests in rights: None Leanne Graham Experience and expertise: Ms Graham is one of New Zealand’s few female IT entrepreneur’s with over 30 years’ experience at the highest levels in the software sector. She has built a name for herself by enabling multiple cloud, mobility and SaaS companies to maximise their global go to market opportunities. Leanne holds a number of directorships on both public and private companies in Australia and New Zealand as well as sits on a number of advisory boards globally. She was the General Manager of Sales at Xero and was the architect of their global sales strategy around ‘recruit, educate and grow’; a key channel strategy used to build Xero’s customer base in New Zealand, Australia, United Kingdom and the United States. Through her strategic investment company Cloud Rainmakers Ltd, she assists technology companies to identify how they can develop strategic partnerships and disrupt an industry to become export successes. Other current directorships: Non‑Executive Chairperson of VPC Limited (ASX: VPC) Non‑Executive Director of archTIS Limited (ASX: AR9) Former directorships (last 3 years): Apps Village Limited (ASX: APV) Interests in shares: 217,717 fully paid ordinary shares Interests in options: 519,568 unlisted options (which includes 17,242 Class L Options that expire on 8 November 2020) Interests in rights: None Interim Non‑Executive Chairman Non‑Executive Director 18 Bid Annual Report 2020 Non‑Executive Director Managing Director (appointed 17 January 2018) David Hancock Experience and expertise: David Hancock was appointed a Non‑Executive Director on 27 August 2020. David brings to b.id over 30 years of broad experience in financial services and technology companies. This experience includes being the Group Head and Executive Director at Afterpay Touch where he worked with the founders to build the company from IPO to an ASX Top 100 listed company. David was also one of Afterpay’s first shareholders. David’s time at Afterpay included leading the Company at a time it sought expansion into global markets, specifically the UK and the USA. David has also held numerous executive and board positions at a variety of leading financial institutions including Commonwealth Bank, Tower Insurance – where he was Chief Executive Officer, and at JPMorgan where he was a Managing Director with responsibilities in Australia, New Zealand, Asia and Japan across various operations. Other current directorships: None Former directorships (last 3 years): Afterpay Ltd (ASX: APT) ELMO Software Ltd (ELO) Interests in shares: 70,000 fully paid ordinary shares Guy Maine Experience and expertise: Mr Maine has extensive experience building businesses and developing markets for new technology products for leading Australian service providers having held integral executive roles at SingTel Optus, Virgin Mobile, and FOXTEL, including General Management, Director of Sales and Executive Director, respectively. Mr Maine was responsible for the launch of Optus prepaid mobile phones in Australia, as well as securing new distribution channels and driving retail strategy. As Director of Sales for Virgin Mobile, Mr Maine worked with a focused team to launch the challenger brand in 2000 to profitability, before joining FOXTEL in 2003 as Director of Sales. At FOXTEL Mr Maine worked with the core executive team and an internationally credentialed Board on its consumer challenge to convert to digital and heighten consumer growth, and later became an Executive Director of the company. Other current directorships: None Former directorships (last 3 years): None Interests in shares: 188,525 fully paid ordinary shares Interests in options: 2,686,330 unlisted options Interests in rights: None 19 Board and Key Executives (cont’d) Anthony Du Preez The CTO and original founder of Bid, Anthony Du Preez, has spent the last 18 years designing and building advanced auction‑based markets for a range of industries including logistics, supply chain, port capacity, forestry timber, energy, and carbon permits. Anthony has a passion for Robotic Process Automation (RPA), Artificial Intelligence (AI), machine learning and cognitive automation. As CTO at Bid Anthony is responsible for the development and direction of our SaaS platform and is constantly looking for advancements to add further value to Bid clients. BigData insights and the development of further ways to utilize our world class technology to assist business to automate, manage and use data to ensure clean information is immediately available to make critical agile business decisions . His education a Bachelor of Engineering (First Class Honors), an MBA from the Melbourne School of Business and a post‑graduate in advanced management at Berkeley University in San Francisco, the United States has provided a firm foundation for Anthony to become a thought leader in “Orchestrated RPA” for complex business processes and the application of Machine Learning technology in the Utility bill Management space Darren Knihnicki Darren Knihnicki is an experienced commercial executive with a proven track record in driving shareholder value and growth on a global scale. Mr. Knihnicki has over 15 years’ experience working both locally and globally across a multitude of technology organisations. He has extensive cross‑sector experience and has previously worked as CFO for eNett and Assembly Payments and also Chief Commercial Officer for Tapendium. Founder and Chief Technical officer Chief Commercial Officer 20 Bid Annual Report 2020 Chief Operating Officer President USA Marco Miranda Marco Miranda joined Bid in March 2020 and was in July 2020 promoted to the role of Chief Operating Officer, leading our global services and operations teams. Prior to Bid, Marco spent the last 25 years working with some of Australia’s leading Telco and Media brands, his experience and leadership has been focused on scaling tech driven businesses. With executive‑level positions across a number of functions, including sales & revenue, end‑to‑end customer experience and business transformation. Marco has an infectious‑passion and energy for people and teams, improving the customer experience and transforming operating‑models. Rodney Frye Rodney Frye has over 30 years’ experience in successfully bringing products and start up organizations to the North America market. While serving as President of Intelledox, an Australian based company, Rodney was responsible for building and leading the Intelledox’s North American operations. Prior to its acquisition in July, 2019, Intelledox was rapidly established as a leader in the Workflow and Content automation space as well as the Digital Transformation space. Prior to joining Intelledox, he served as Vice President, North America Sales at Thunderhead, a United Kingdom company, where he was part of the leadership team that successfully brought and established the brand as a leader in the Customer Engagement market in North America. Prior to Thunderhead, Rodney held sales and technical positions at Pitney‑Bowes Software, and Image Sciences (now part of the Oracle family). Rodney holds a Bachelor of Business Administration, Data Processing and Analysis from McCombs Business School, University of Texas, at Austin and has been trained in Solution Selling, Dale Carnegie Selling and Sales Psychology. 21 Board and Key Executives (cont’d) Simon Farmer Simon Farmer has 15 years’ experience within the Energy Industry both as a major energy user, client side and working for leading UK supplier NPower. More recently Simon has led the energy divisions of some of the UK largest FM business’ , at the likes of G4S and Amey. Now 2 years into the exciting journey with B.ID rapidly scaling the UK business and launching into Europe. Lior Harel Lior Harel was appointed as General Counsel & Company Secretary on 28 September 2020. Lior came to b.id having spent just under 2 years as General Counsel and Company Secretary of Cronos Australia Ltd, a medicinal cannabis company with operations in Australia and Asia. Prior to Cronos Australia, Lior was the Chief Legal Counsel of SEEK.com.au for approximately 7 years, focusing primarily on M&A and Corporate Finance transactions for SEEK’s Australian and Asian businesses. Lior commenced his career at leading Australian commercial law firm, Arnold Bloch Leibler, rising to Senior Associate. Lior holds an LLB and a BA from the University of Melbourne. Vice President UK General Counsel & Company Secretary 22 Bid Annual Report 2020 Contents 24 Directors’ report 47 Statement of Cash Flows 43 Auditor’s independence declaration 48 Notes to the financial statements 44 Statement of profit or loss and other 85 Directors’ declaration comprehensive income 45 Statement of financial position 46 Statement of changes in equity 86 Independent auditor’s report 91 Shareholder information 23 Directors’ report The Directors present their report, together with the financial statements, on the Consolidated Entity consisting of BidEnergy Limited (referred to hereafter as the ‘Company’ or ‘Parent Entity’) and the entities it controlled at the end of, or during, the year ended 30 June 2020. Directors The following persons were Directors of BidEnergy Limited during the financial year and up to the date of this report, unless otherwise stated: Geoffrey Kleemann Guy Maine Leanne Graham Andrew Dyer Principal activities (Interim Chairman) (appointed as Non‑Executive Director on 1 September 2019, became Interim Chairman on 10 June 2020) (Managing Director) (Non‑Executive Director) (Non‑Executive Chairman) (retired from the Board on 30 June 2020) During the financial year the principal continuing activities of the Consolidated Entity consisted of carrying on its business as a provider of Utility Bill Management services through the deployment of its cloud‐based software platform. In the US only, the consolidated entity also earns revenue from its rebate management business whereby fees are earned from clients for managing the submission of information to energy retailers to facilitate the processing of rebates under the ‘Energy Efficient Infrastructure Program’ applicable in the US. Dividends There were no dividends paid, recommended or declared during the current or previous financial year. Review of operations BidEnergy’s total operating revenue grew to $9.4M in FY20 (FY19: $5.3M) representing a 77% increase year on year. Importantly this growth was achieved through the combination of growth in BidEnergy subscription fee revenue up 66% to $4.9M, together with strong USA based energy rebate revenues which also grew during the year contributing revenue of $4.5M (FY19: $2.4M). This was delivered through significant growth in new client contracts, here in Australia and overseas, as well as recurring revenue from existing clients who took up additional commodities and platform services. BidEnergy clients grew to 128 at 30 June 2020, from 92 at 30 June 2019. Underlying EBITDA* loss increased 5% to $4.9M for FY20 as the Consolidated Entity continued to invest this year in its salesforce, product development and operations to enable it to execute and deliver on growing opportunities domestically and overseas. The Consolidated Entity has made significant investment in its solution for facilities management, energy brokers, and energy retailer portals, where we see substantial scale opportunities. The Consolidated Entity has a strong sales pipeline on which to execute and the investment made in advancing the companies technology provides a solid platform for growth in FY21. The loss for the Consolidated Entity after providing for income tax amounted to $6.9M (FY19: $6.6M). A reconciliation of underlying EBITDA to loss for the year is contained in note 4, operating segments. During the 2020 financial year, the Consolidated Entity successfully raised $5.1M (before costs) through share placements from sophisticated and institutional investors and $1.6 million through a share purchase plan from eligible shareholders. The funds will be utilised to accelerate the Company’s expansion in the USA, UK and European markets through the investment in local sales and operational support to service a growing and emerging portfolio of large UK‑based customers, and the even larger opportunity the USA represents. At 30 June 2020 the Company held $8.3M in cash. 24 Bid Annual Report 2020 Directors’ report continued BidEnergy Subscription Fee Revenue Rebate Revenue BidEnergy non‑subscription fee revenue Total Revenue Underlying EBITDA* Statutory net loss after tax FY20 $’000 4,867 4,421 100 9,388 (4,875) (6,911) FY19 $’000 % Favourable/ (Unfavourable) 2,924 2,353 27 5,304 (4,662) (6,566) 66% 88% 270% 77% (5%) (5%) * Underlying EBITDA is a non‑IFRS measure calculated as earnings before income tax, and before depreciation and amortisation, capitalised salaries, share based payments, reorganisation costs, transaction fees, net finance costs and foreign exchange as detailed in note 4 of the financial report. ** AASB 16 Leases was adopted for the first time requiring capitalisation and amortisation of the Consolidated Entity’s Right of Use Assets, as outlined in note 2 of the financial statements. The modified retrospective approach was used and as such the comparatives have not been restated. Therefore, the current and comparative EBITDA is not directly comparable. Significant changes in the state of affairs On 3 July 2019, the Company issued 655,201 fully paid ordinary shares at an issue price of $0.68 (68 cents) per share pursuant to the exercise of BIDO Listed Options, raising $445,537. On 9 July 2019, the Company issued 1,051,016 fully paid ordinary shares as Shortfall Shares from the Underwriting agreement between the Company and Canaccord Genuity (Australia) Limited at an issue price of $0.68 (68 cents), raising $714,691. The Company issued a total of 2,250,198 fully paid ordinary shares pursuant to the conversion of Class E Performance Rights, including: • • • • 1,227,727 fully paid ordinary shares on 26 July 2019; 353,540 fully paid ordinary shares on 5 August 2019; 114,005 fully paid ordinary shares on 13 August 2019; and 554,926 fully paid ordinary shares on 11 September 2019. On 5 August 2019, the Company issued 110,000 Class F Performance Rights for nil cash consideration, as an equity‑based incentive component to the remuneration package of a senior employee of the BidEnergy Limited Group. On 11 September 2019, the Company issued 257,354 Shares for nil cash consideration, to the certain employees of the Company as an equity‑based component of their remuneration. On 14 October 2019, the Company completed a placement to sophisticated and professional investors (“Placement Participants”) under which the company issued a total of 8,750,001 fully paid ordinary shares at an issue price of $0.58 per share to raise $5,075,000 (before costs) (“Placement”). On 8 November 2019, the Placement Participants also received one free attaching Class L Option for every share subscribed for under the Placement, in accordance with the terms of the Placement. Each Class L Option has an exercise price of $0.75 (75 cents), and an expiry date of 8 November 2020. During November 2019 and December 2019, the Company also raised a further $1,603,506 (before costs) by the issue of 2,764,665 fully paid ordinary shares at an issue price of $0.58 per share under a SPP for eligible shareholders. Pursuant to the terms of the SPP Offer, participants under the SPP also received one free attaching Class L Option for every share subscribed for under the SPP. Each Class L Option has an exercise price of $0.75 (75 cents), and an expiry date of 8 November 2020. On 13 January 2020, the Company issued 655,000 fully paid ordinary shares at an issue price of $0.75 (75 cents) per share pursuant to the exercise of Class L Options, raising $491,250. On 24 January 2020, the Company issued 774,267 fully paid ordinary shares pursuant to the exercise of 490,530 Class L Options at an issue price of $0.75 (75 cents) per share and 283,737 Class E Options at an issue price of $0.476 (47.6 cents) per share, raising $502,956. On 31 January 2020, the Company issued 44,500 fully paid ordinary share at an issue price of $0.75 (75 cents) per share pursuant to the exercise of Class L Options, raising, raising $33,375. 25 Directors’ report continued On 7 February 2020, the Company issued 200,000 fully paid ordinary shares at an issue price of $0.75 (75 cents) per share pursuant to the exercise of Class L Options, raising $150,000. On 10 February 2020, the Company issued 471,938 Class P Options with an exercise price of $1.70 per option, expiring 7 February 2024. On 14 February 2020, the Company issued 130,700 fully paid ordinary shares at an issue price of $0.75 (75 cents) per share pursuant to the exercise of Class L Options, raising $98,025. On 21 February 2020, the Company issued 7,500 fully paid ordinary shares at an issue price of $0.75 (75 cents) per share pursuant to the exercise of Class L Options, raising $5,625. On 28 February 2020, the Company issued 39,485 fully paid ordinary shares at an issue price of $0.75 (75 cents) per share pursuant to the exercise of Class L Options, raising $29,613. On 9 March 2020, the Company issued 1,073,000 fully paid ordinary shares pursuant to the conversion of Restricted Share Units. On 16 March 2020, the Company announced that it had resolved proceedings issued by its former Chairman, Mr James Baillieu against the Company in the Supreme Court of Victoria. On 25 March 2020, the Company issued 161,606 Class G Performance Rights for nil cash consideration, as an equity‑based incentive component to the remuneration package of a senior employee of the BidEnergy Limited Group. The Performance Rights will expire on 25 June 2021. On 8 April 2020, the Company granted the following securities under the Employee Incentive Plan: • • • 436,677 Class B Restricted Stock Units (“RSUs”) for nil consideration, expiring 7 April 2023. The RSUs will automatically vest upon the satisfaction of both performance conditions and retention conditions; 873,077 Class H Performance Rights for nil consideration, expiring 7 April 2023. The Performance Rights will automatically vest upon the satisfaction of both performance conditions and retention conditions; and 140,950 Class I Performance Rights for nil consideration, expiring 7 April 2023. The Performance Rights will automatically vest upon the satisfaction of both performance conditions and retention conditions. On 12 May 2020, the Company issued 105,887 Class J Performance Rights for nil cash consideration under the Employee Incentive Plan, expiring 12 May 2021. The Performance Rights will vest three months from the date of grant, subject to the holders remaining employed by the Company at the date of vesting. The above securities were issued to certain employees of the Company who have elected to participate in a program to help preserve the Company’s cash during the COVID‑19 impact period. On 10 June 2020, the Company appointed Non‑Executive Director, Geoffrey Kleemann, as Interim Chairman, following advice from outgoing Chairman, Andrew Dyer, of his intention to retire as director of the Company, effective from 30 June 2020. On 12 June 2020, the Company issued the following securities under its Employee Incentive Plan: • • • 148,969 Class K Performance Rights for nil consideration, expiring 12 June 2021. The Performance Right will vest on 12 September 2020, subject to the holder remaining employed by the Company on vesting date; 68,625 Class C Restricted Stock Units “RSUs” for nil consideration, expiring 12 June 2021. The RSUs will vest on 12 September 2020, subject to the holder remaining employed by the Company on vesting date; and 54,651 Class L Performance Rights for nil consideration, expiring 12 June 2021. The Performance Right will vest on 12 September 2020, subject to the holder remaining employed by the Company on vesting date. The above securities were issued to certain employees of the Company who have elected to participate in a program to help preserve the Company’s cash during the COVID‑19 impact period. Other than as noted elsewhere in this report, there were no other significant changes in the state of affairs of the Consolidated Entity during the financial year. 26 Bid Annual Report 2020 Directors’ report continued Matters subsequent to the end of the financial year On 13 July 2020, the Company issued 174,424 Class M Performance Rights under its Employee Incentive Plan. The above securities were issued to certain employees of the Company who have elected to participate in a program to help preserve the Company’s cash during the COVID‑19 impact period. The Performance Rights will vest on 13 October 2020, subject to the holder remaining employed by the Company on vesting date. On 17 July 2020, the Company issued 110,000 fully paid ordinary shares on conversion of Class F performance rights. On 29 June 2020, the Chief Financial Officer tendered his resignation, effective 28 July 2020. The impact of Coronavirus (COVID‑19) pandemic is ongoing and while there have been mixed financial and operational impacts for the Consolidated Entity up to 30 June 2020, it is not practical to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided. On 21 May 2020, BidEnergy Inc entered into the Paycheck Protection Program and took out USD$242,030 (AUD$351,291) in promissory note with TD Bank, N.A. The promissory note has a fixed interest rate of 1% and matures 2 years from the date of issue. BidEnergy Inc must pay monthly principal and interest payments on the outstanding principal balance of the loan amortised over the term of the loan, unless otherwise forgiven in whole or part in accordance with the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). Pursuant to the terms of the CARES Act and any implementing rules and regulations, BidEnergy Inc will apply for the loan to be forgiven by the Small Business Administration (“SBA”, an Agency of the United States of America) in whole or in part beginning no sooner than seven (7) weeks from the date of the Note. Any loan balance remaining following forgiveness by the SBA will be fully reamortized over the remaining term of the loan. BidEnergy Inc is meeting its obligations under the act, and intends to apply for forgiveness in the 1st quarter of FY21. On 12 August 2020, the Company issued 105,887 fully paid ordinary shares on conversion of Class J performance rights. On 17 August 2020, the Company issued 1,950,000 Class Q Options with an exercise price of $1.26 per option, expiring 17 August 2024. On 21 August 2020, the Company issued 134,485 fully paid ordinary shares at an issue price of $0.75 (75 cents) per share pursuant to the exercise of Class L Options, raising $100,863. No other matter or circumstance has arisen since 30 June 2020 that has significantly affected, or may significantly affect the Consolidated Entity’s operations, the results of those operations, or the Consolidated Entity’s state of affairs in future financial years. Likely developments and expected results of operations BidEnergy will continue to focus on growing its customer base to provide Utility Bill Management services. Growth will be targeted at continued Australian, New Zealand, US and UK expansion, upselling existing platform services, and cross selling the BidEnergy platform to Bid US customers. BidEnergy will continue to pursue new channel partners through which to distribute the BidEnergy platform. Environmental regulation The Consolidated Entity is not subject to any significant environmental regulation under Australian Commonwealth or State law. 27 Directors’ report continued Information on Directors Name Title Experience and expertise Geoffrey Kleemann Interim Chairman (appointed as Independent Non‑Executive Director on 1 September 2019, became Interim Chairman on 10 June 2020) Mr Kleemann commenced his career at Deloitte, and subsequently completed approximately twenty years as a senior executive in a listed environment, as Chief Financial Officer for Crown Limited, Publishing and Broadcasting Limited, Woolworths Limited and Pioneer International Limited. Other current directorships Independent Non‑Executive Director of Domain Holdings Australia Limited (ASX: DHG) Former directorships (last 3 years) Non‑Executive Director of Investa Office Fund (ASX: IOF, delisted in December 2018) Interests in shares Interests in options 201,725 fully paid ordinary shares 51,725 unlisted Class L options 208,208 unlisted Class N options Interests in rights None Name Title Experience and expertise Guy Maine Managing Director Mr Maine has extensive experience building businesses and developing markets for new technology products for leading Australian service providers having held integral executive roles at SingTel Optus, Virgin Mobile, and FOXTEL, including General Management, Director of Sales and Executive Director, respectively. Mr Maine was responsible for the launch of Optus prepaid mobile phones in Australia, as well as securing new distribution channels and driving retail strategy. As Director of Sales for Virgin Mobile, Mr Maine worked with a focused team to launch the challenger brand in 2000 to profitability, before joining FOXTEL in 2003 as Director of Sales. At FOXTEL Mr Maine worked with the core executive team and an internationally credentialed Board on its consumer challenge to convert to digital and heighten consumer growth, and later became an Executive Director of the company. Other current directorships Former directorships (last 3 years) None None Interests in shares Interests in options 188,525 fully paid ordinary shares 2,205,883 unlisted Class J options 300,000 unlisted Class M options 180,447 unlisted Class N options Interests in rights None 28 Bid Annual Report 2020 Directors’ report continued Name Title Experience and expertise Leanne Graham Independent Non‑Executive Director Ms Graham is one of New Zealand’s few female IT entrepreneur’s with over 30 years’ experience at the highest levels in the software sector. She has built a name for herself by enabling multiple cloud, mobility and SaaS companies to maximise their global go to market opportunities. Leanne holds a number of directorships on both public and private companies in Australia and New Zealand as well as sits on a number of advisory boards globally. She was the General Manager of Sales at Xero and was the architect of their global sales strategy around ‘recruit, educate and grow’; a key channel strategy used to build Xero’s customer base in New Zealand, Australia, United Kingdom and the United States. Through her strategic investment company Cloud Rainmakers Ltd, she assists technology companies to identify how they can develop strategic partnerships and disrupt an industry to become export successes. Other current directorships Executive Chair of VPC Limited (ASX: VPC) Non‑Executive Director of archTIS Limited (ASX: AR9) Former directorships (last 3 years) Non‑Executive Director of AppsVillage Australia Limited (ASX: APV) Interests in shares Interests in options 217,717 fully paid ordinary shares 294,118 unlisted Class K options 17,242 unlisted Class L options 208,208 unlisted Class N options Interests in rights None 29 Directors’ report continued Name Title Andrew Dyer Independent Non‑Executive Chairman (retired on 30 June 2020) Qualifications B.E (Hons), MBA, MAICD Experience and expertise Mr Dyer’s career includes extensive experience in sales and operational roles across a range of industries including information technology, energy, telecommunications and professional services. He has held senior executive and operational positions in Australia and the United States, including roles at IBM, SMS Management & Technology, Indus International and Florida Power & Light Group. Mr Dyer has considerable experience in government, government relations and international trade. He is the former Commissioner to the Americas for the Victorian government, and currently serves as the National Wind Farm Commissioner for the Federal government, reporting to the Australian Parliament. In addition to his professional and executive career, Mr Dyer has extensive governance experience as a chairman and non‑executive director. He has served as chair and director of numerous private and public sector organisations – spanning a wide range of sectors including energy, utilities, telecommunications, insurance, health, education, arts, retail and wholesale distribution. Mr Dyer is a Professorial Fellow at Monash University, holds a Bachelor of Engineering with first class honours from Monash University, and an MBA from Georgetown University in Washington DC. He is a member of the Australian Institute of Company Directors. Other current directorships Former directorships (last 3 years) None None Interests in shares Interests in options 202,725 fully paid ordinary shares on the date of retirement 147,059 unlisted Class K options on the date of retirement 277,611 unlisted Class N options on the date of retirement 51,725 unlisted Class L options on the date of retirement ‘Other current directorships’ quoted above are current directorships for listed entities only and excludes directorships of all other types of entities, unless otherwise stated. ‘Former directorships (last 3 years)’ quoted above are directorships held in the last 3 years for listed entities only and excludes directorships of all other types of entities, unless otherwise stated. 30 Bid Annual Report 2020 Directors’ report continued Company secretary Miss Erlyn Dale Miss Dale is an experienced corporate professional with a broad range of corporate governance and capital markets experience, having been involved with several public company listings, merger and acquisition transactions and capital raisings for ASX‑listed companies across a diverse range of industries. Miss Dale began her career in corporate recovery and restructuring at Ferrier Hodgson and is now the Managing Director of corporate services firm, Azalea Consulting, which provides outsourced company secretarial, accounting and administration services to a portfolio of ASX‑listed companies. Miss Dale holds a Bachelor of Commerce (Accounting and Finance) and a Graduate Diploma in Applied Corporate Governance. She is a member of the Governance Institute of Australia/Chartered Secretary. Meetings of Directors The number of meetings of the Company’s Board of Directors (‘the Board’) and of each Board committee held during the year ended 30 June 2019, and the number of meetings attended by each Director were: Full Board Full Board Audit and Risk Committee Audit and Risk Committee Remuneration and Nomination Committee Remuneration and Nomination Committee 30 June 2020 Attended Held Attended Held Attended Held Geoffrey Kleemann Guy Maine Leanne Graham Andrew Dyer 8 11 11 10 8 11 11 11 2 – 5 4 2 – 5 5 3 – 4 4 3 – 4 4 Held: represents the number of meetings held during the time the Director held office or was a member of the relevant committee. 31 Directors’ report continued Remuneration report (audited) The remuneration report details the key management personnel remuneration arrangements for the Consolidated Entity, in accordance with the requirements of the Corporations Act 2001 and its Regulations. Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including all directors. The remuneration report is set out under the following main headings: • Principles used to determine the nature and amount of remuneration; • Details of remuneration; • • Service agreements; Share‑based compensation; • Additional information; and • Additional disclosures relating to key management personnel. Principles used to determine the nature and amount of remuneration The objective of the Consolidated Entity’s executive reward framework is to ensure reward for performance is competitive and appropriate for the results delivered. The framework aligns executive reward with the achievement of strategic objectives and the creation of value for shareholders, and it is considered to conform to the market best practice for the delivery of reward. The Board of Directors (‘the Board’) ensures that executive reward satisfies the following key criteria for good reward governance practices: • competitiveness and reasonableness; • acceptability to shareholders; • performance linkage/alignment of executive compensation; and • transparency. The Board is responsible for determining and reviewing remuneration arrangements for its directors and executives. The performance of the Consolidated Entity depends on the quality of its directors and executives. The remuneration philosophy is to attract, motivate and retain high performance and high‑quality personnel. The reward framework is designed to align executive reward to shareholders’ interests. The Board have considered that it should seek to enhance shareholders’ interests by: • • having economic profit as a core component of plan design; focusing on sustained growth in shareholder wealth, through growth in share price, and delivering constant or increasing return on assets as well as focusing the executive on key non‑financial drivers of value; and • attracting and retaining high calibre executives. Additionally, the reward framework should seek to enhance executives’ interests by: • • rewarding capability and experience; reflecting competitive reward for contribution to growth in shareholder wealth; and • providing a clear structure for earning rewards. In accordance with best practice corporate governance, the structure of non‑executive director and executive director remuneration is separate. 32 Bid Annual Report 2020 Directors’ report continued Non‑executive directors’ remuneration Fees and payments to non‑executive directors reflect the demands and responsibilities of their role. Non‑executive directors’ fees and payments are reviewed annually by the Board. The Board may, from time to time, receive advice from independent remuneration consultants to ensure non‑executive directors’ fees and payments are appropriate and in line with the market. Shareholders approve the maximum aggregate remuneration for non‑executive directors. The Board recommends the actual payments to directors and the Board is responsible for ratifying any recommendations, if appropriate. ASX listing rules require the aggregate non‑executive directors’ remuneration be determined periodically by a general meeting. The aggregate approved remuneration for non‑executive directors is $500,000. Executive remuneration The Consolidated Entity aims to reward executives based on their position and responsibility, with a level and mix of remuneration which has both fixed and variable components. The executive remuneration and reward framework has four components: • base pay and non‑monetary benefits; • • short‑term performance incentives; share‑based payments; and • other remuneration such as superannuation and long service leave The combination of these comprises the executive’s total remuneration. Fixed remuneration, consisting of base salary, superannuation and non‑monetary benefits, are reviewed annually by the Board based on individual and business unit performance, the overall performance of the Consolidated Entity and comparable market remunerations. Executives may receive their fixed remuneration in the form of cash or other fringe benefits (for example motor vehicle benefits) where it does not create any additional costs to the Consolidated Entity and provides additional value to the executive. The short‑term incentives (‘STI’) program is designed to align the targets of the business units with the performance hurdles of executives. STI payments are granted to executives based on specific annual targets and key performance indicators (‘KPI’s’) being achieved. KPI’s include revenue growth, profit contribution and customer retention. The long‑term incentives (‘LTI’) include long service leave and share‑based payments. The Board reviewed the long‑term equity‑linked performance incentives specifically for executives during the year ended 30 June 2020. Consolidated entity performance and link to remuneration Remuneration for certain individuals is directly linked to the performance of the Consolidated Entity. A portion of cash bonus and incentive payments are dependent on defined performance targets being met. The remaining portion of the cash bonus and incentive payments are at the discretion of the Board. The Board is of the opinion that the continued improved results can be attributed in part to the adoption of performance‑based compensation and is satisfied that this improvement will continue to increase shareholder wealth if maintained over the coming years. Use of remuneration consultants During the financial year ended 30 June 2020, the Consolidated Entity, through the Nomination and Remuneration Committee, engaged HRascent, remuneration consultant, to benchmark executive remuneration and provide recommendations on how to improve LTI program. This has resulted in share‑based payments remuneration in the form of options (LTI) being implemented. HRascent was paid $39,050 for these services. An agreed set of protocols were put in place to ensure that the remuneration recommendations would be free from undue influence from key management personnel. These protocols include requiring that the consultant not communicate with affected key management personnel without a member of the Board being present, and that the consultant not provide any information relating to the outcome of the engagement with the affected key management personnel. The Board is also required to make inquiries of the consultant’s processes at the conclusion of the engagement to ensure that they are satisfied that any recommendations made have been free from undue influence. The Board is satisfied that these protocols were followed and as such there was no undue influence. 33 Directors’ report continued Voting and comments made at the Company’s 2019 Annual General Meeting (‘AGM’) At the 2019 Annual General Meeting of shareholders held on 28 November 2019, 82.60% of the votes received supported the adoption of the remuneration report for the year ended 30 June 2019. The Company did not receive any specific feedback at the AGM regarding its remuneration practices. Details of remuneration The Key Management Personnel of the Consolidated Entity consisted of the following Directors and Executives of BidEnergy Limited: • Mr Geoffrey Kleemann – Interim Chairman (appointed as Non‑Executive Director 1 September 2019, becoming Interim Chairman on 10 June 2020); • Mr Guy Maine – Managing Director; • Ms Leanne Graham – Non‑Executive Director; • Mr Andrew Dyer – Non‑Executive Chairman (retired from the Board on 30 June 2020); and • Mr Matthew Watson – Chief Financial Officer (resigned on 28 July 2020). During the 2020 financial year, the Consolidated Entity concluded that Mr Anthony Du Preez and Mr Darren Knihnicki are no longer considered as key management personnel under AASB 124 Related Party Disclosures. Amounts of remuneration Details of the remuneration of key management personnel of the Consolidated Entity are set out in the following tables: Short-term benefits Cash bonus Annual leave Long-term benefits Long service leave Post- employ- ment benefits Share- based payments Super- annuation $ Equity- settled $ Total $ 4,841 56,383 115,984 $ – 5,014 47,500 97,889 650,438 – – – 119,268 194,768 9,964 106,620 201,931 $ – 35 – – Cash salary and fees $ 2020 Directors: Geoffrey Kleemann* 54,760 $ – Guy Maine** Leanne Graham Andrew Dyer*** Other Key Management Personnel: 300,000 200,000 75,500 85,347 – – Matthew Watson**** 213,750 20,000 729,357 220,000 3,685 3,720 4,962 9,976 22,206 84,511 48,955 313,558 429,115 1,476,679 * Mr Geoffrey Kleemann was appointed as Non‑Executive Director on 1 September 2019, became Interim Chairman on 10 June 2020. ** Mr Guy Maine received $200,000 cash bonus following the Board’s assessment of his performance for the 2019 calendar year. *** Mr Andrew Dyer retired from the Board, effective 30 June 2020. **** Mr Matthew Watson received $20,000 cash bonus upon achieving his annual KPIs. He resigned as Chief Financial Officer, effective 28 July 2020. 34 Bid Annual Report 2020 Directors’ report continued 2019 Directors: Andrew Dyer* Guy Maine Leanne Graham James Baillieu** Short-term benefits Long-term benefits Post- employ- ment benefits Share- based payments Cash bonus Non- monetary Super- annuation Equity- settled $ Total $ $ Cash salary and fees $ 63,470 $ – 275,000 120,548 62,404 29,490 – – $ – – – – 6,030 37,577 55,432 124,932 57,321 490,446 – 57,778 120,182 2,802 22,714 1,928 – – 32,292 270,898 8,520 30,738 19,725 136,706 364,063 Other Key Management Personnel: Anthony Du Preez*** Darren Knihnicki**** Matthew Watson 220,833 18,265 9,086 20,290 – 198,500 9,132 – –– 869,987 147,945 9,086 90,776 315,757 1,433,551 * Mr Andrew Dyer was appointed as Non‑Executive Director on 16 July 2018, becoming Non‑Executive Chairman on 21 February 2019. ** Mr James Baillieu resigned as a Director on 22 February 2019. *** Mr Anthony Du Preez resigned as a director on 13 February 2019, however he remains with the consolidated entity as CTO. His remuneration is disclosed under “Other Key Management Personnel”, as he did not receive any additional remuneration in his role as the Director. **** Mr Darren Knihnicki was appointed as Chief Commercial Officer on 27 May 2019. The proportion of remuneration linked to performance and the fixed proportion are as follows: Name 2020 2019 2020 2019 2020 2019 Fixed remuneration At risk – STI At risk – LTI Non–Executive Directors: Geoffrey Kleemann Leanne Graham Andrew Dyer James Baillieu Executive Directors: Guy Maine Other Key Management Personnel: Anthony Du Preez Darren Knihnicki Matthew Watson 51% 39% 47% – – 52% 56% 100% – – – – – – – – 49% 61% 53% – – 48% 44% – 54% 64% 31% 25% 15% 11% – – 78% 93% 72% 59% – – 6% 7% – 3% – – 16% – 28% 38% 35 Directors’ report continued Service agreements Remuneration and other terms of employment for key management personnel are formalised in service agreements. Details of these agreements are as follows: Name Title Guy Maine Managing Director of BidEnergy Limited Agreement commenced 17 January 2018 Term of agreement Ongoing Details Mr Maine receives a base salary of $300,000 per annum plus superannuation. In addition, Mr Maine is entitled to an annual cash bonus, subject to the achievement of performance milestones, with both the amount and milestones being set by the Board on a yearly basis. For 2019 calendar year, Mr Maine’s maximum annual cash bonus entitlement was set at $300,000, subject to a series of defined performance targets. Either party may terminate the employment by providing the other party with three (3) months’ written notice. Name Title Matthew Watson Chief Financial Officer Agreement commenced 10 October 2016 Term of agreement Terminated, effective from 28 July 2020 Details Mr Watson received a base salary of $225,000 per annum plus superannuation. In addition, Mr Watson was entitled to a maximum annual cash bonus up to $25,000 or such other amount as specified by the Board each year, and subject to the achievement of performance targets as defined by the Board. The employment agreement was terminated upon Mr Watson’s resignation, which became effective on 28 July 2020. Key management personnel have no entitlement to termination payments in the event of removal for misconduct. 36 Bid Annual Report 2020 Directors’ report continued Share-based compensation Issue of shares There were no shares issued to Directors and other key management personnel as part of compensation during the year ended 30 June 2020. Options The terms and conditions of each grant of options over ordinary shares affecting remuneration of Directors and other key management personnel in this financial year or future reporting years are as follows: Name Number of options granted Class Grant date Vesting date and exercisable date Expiry date Exercise price Fair value per option at grant date Leanne Graham Class F 73,530 16/12/16 31/05/19 28/07/20 $0.680 Guy Maine Andrew Dyer Class J 2,205,883 17/01/18 Various 16/01/22 Class K 294,118* 27/11/18 26/11/21 26/11/22 Leanne Graham Class K 294,118 27/11/18 26/11/21 26/11/22 Guy Maine Andrew Dyer Guy Maine Class M 1,000,000** 03/12/19 31/01/22 29/01/23 Class N 277,611 03/12/19 03/12/19 14/10/23 Class N 277,611** 03/12/19 30/08/20 14/10/23 Leanne Graham Class N 208,208 03/12/19 03/12/19 14/10/23 Geoffrey Kleemann Class N 208,208 03/12/19 03/12/19 14/10/23 Matthew Watson Class P 235,969*** 10/02/20 30/06/22 07/02/24 $0.136 $1.190 $1.190 $1.930 $0.850 $0.850 $0.850 $0.850 $1.700 $0.087 $0.008 $0.475 $0.475 $0.189 $0.271 $0.276 $0.271 $0.271 $0.722 * Mr Andrew Dyer retired from the Board on 30 June 2020. 147,059 Class K options were forfeited on the date of resignation. ** 700,000 Class M and 97,164 Class N options issued to Mr Guy Maine were forfeited during the year as the non‑market vesting conditions were not met. *** 184,842 Class P options issued to Mr Matthew Watson were forfeited on 30 June 2020 as the non‑market vesting conditions were not met. Options granted carry no dividend or voting rights. Except for the above, there were no options over ordinary shares granted to or vested by Directors and other key management personnel as part of compensation during the year ended 30 June 2020. Performance rights The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of Directors and other key management personnel in this financial year or future reporting years are as follows: Name Matthew Watson Matthew Watson Number of rights granted Vesting date and exercisable date Grant date Expiry date Exercise price Fair value per right at grant date 8,053 12/05/20 12/08/20 12/05/21 8,189 12/06/20 12/09/20 12/06/21 – – $0.785 $0.650 Performance rights granted carry no dividend or voting rights. 37 Directors’ report continued Additional information The earnings of the Consolidated Entity for the five years to 30 June 2020 are summarised below: 2020 $ 2019 $ 2018 $ 2017 $ 2016 $ Revenue and other income 9,477,989 5,444,338 4,464,293 2,999,867 1,248,181 Net loss before tax Net loss after tax (6,892,991) (6,599,957) (4,527,522) (7,378,001) (3,302,777) (6,910,711) (6,566,405) (4,517,631) (7,185,483) (3,302,777) The factors that are considered to affect total shareholders return (‘TSR’) are summarised below: Share price at financial year start ($) Share price at 2019 financial year start adjusted for share consolidation ($) Share price at financial year end ($) Basic earnings per share (cents per share) Diluted earnings per share (cents per share) 2020 0.83 – 0.62 (5.52) (5.52) 2019 0.05 0.34 0.83 (6.00) (6.00) 2018 0.02 – 0.05 (0.66) (0.66) 2017 0.10 – 0.02 (2.21) (2.21) 2016 0.11 – 0.10 (1.02) (1.02) Additional disclosures relating to key management personnel Shareholding The number of shares in the Company held during the financial year by each Director and other members of key management personnel of the Consolidated Entity, including their personally related parties, is set out below: Balance at the start of the year/ commence –ment date Received as part of vesting of performance rights Additions Disposals Other Ordinary shares Andrew Dyer* Guy Maine Leanne Graham Geoffrey Kleemann Anthony Du Preez*** Matthew Watson 86,000 143,977 184,235 150,000** 6,833,684 – – – – – – 184,416 116,725 44,548 33,482 51,725 – – Balance at the end of the year – 188,525 217,717 201,725 – – – – – (202,725) – – – (1,333,332) (5,500,352) (65,000) – 119,416 7,397,896 184,416 246,480 (1,398,332) (5,703,077) 727,383 * Mr Andrew Dyer retired from the Board on 30 June 2020. The balance in “Other” column represents his shareholding as at the date of resignation. ** Mr Geoffrey Kleemann was appointed to the Board on 1 September 2019. He held 150,000 fully paid ordinary shares on the date of his appointment. *** Mr Anthony Du Preez is no longer considered as a key management personnel under AASB 124 as at 30 June 2020. The balance in “Other” column represents his shareholding on that date. 38 Bid Annual Report 2020 Directors’ report continued Option holding The number of options over ordinary shares in the Company held during the financial year by each Director and other members of key management personnel of the Consolidated Entity, including their personally related parties, is set out below: Options over ordinary shares Andrew Dyer* Guy Maine** Leanne Graham Geoffrey Kleemann Matthew Watson*** Anthony Du Preez**** Balance at the start of the year 294,118 2,205,883 367,648 – – – Granted Forfeited Other Balance at the end of the year 329,336 1,277,611 225,450 259,933 235,969 235,969 – (623,454) – (797,164) – – (184,842) – – – – (82,589) (153,380) 2,686,330 593,098 259,933 51,127 – 2,867,649 2,564, 268 (1,064,595) (776,834) 3,590,488 * Mr Andrew Dyer retired from the Board on 30 June 2020. The balance in “Other” column represents his option holding as at the date of resignation. ** 700,000 Class M and 97,164 Class N options issued to Mr Guy Maine were forfeited during the year as the non‑market vesting conditions were not met. *** 184,842 Class P options issued to Mr Matthew Watson were forfeited on 30 June 2020 as the non‑market vesting conditions were not met. **** 82,589 Class P options issued to Mr Anthony Du Preez were forfeited on 30 June 2020 as the non‑market vesting conditions were not met. Mr Anthony Du Preez is no longer considered as a key management personnel under AASB 124 as at 30 June 2020. The balance in “Other” column represents his option holding on that date. Performance rights holding The number of performance rights over ordinary shares in the Company held during the financial year by each Director and other members of key management personnel of the Consolidated Entity, including their personally related parties, is set out below: Performance rights over ordinary shares Matthew Watson Darren Knihnicki Balance at the start of the year Granted Forfeited Other Balance at the end of the year 184,416 110,000 16,242 14,437 (184,416) – 16,242 – (124,437) – 294,416 30,679 (184,416) (124,437) 16, 242 * Mr Darren Knihnicki is no longer considered as a key management personnel under AASB 124 as at 30 June 2020. The balance in “Other” column represents his performance right holding on that date. This concludes the remuneration report, which has been audited. 39 Directors’ report continued Shares under option Unissued ordinary shares of BidEnergy Limited under option at the date of this report are as follows: Class Unlisted Class E Unlisted Class G Unlisted Class H Unlisted Class I Unlisted Class J Unlisted Class K Unlisted Class L Unlisted Class M Unlisted Class N Unlisted Class P Unlisted Class Q Grant date Expiry date Exercise price Number under option 24/11/16 24/11/21 08/08/17 31/12/20 08/08/17 31/12/20 08/08/17 31/12/20 17/01/18 16/01/22 27/11/18 26/11/22 08/11/19 08/11/20 03/12/19 29/01/23 03/12/19 14/10/23 10/02/20 07/02/24 17/08/20 17/08/24 $0.476 $0.204 $0.306 $0.408 $0.136 $1.190 $0.750 $1.930 $0.850 $1.700 $1.260 283,737 882,353 882,353 1,250,000 2,205,883 441,177 9,812,466 300,000 874,474 204,506 1,950,000 19,086,949 No person entitled to exercise the options had or has any right by virtue of the option to participate in any share issue of the Company or of any other body corporate. Shares issued on the exercise of options The following ordinary shares of BidEnergy Limited were issued during the year ended 30 June 2020 and up to the date of this report on the exercise of options granted: Date options granted Class 08/11/19 24/11/16 Unlisted Class L options Unlisted Class E options Exercise price Number of shares issued $0.750 $0.476 1,702,200 283,737 1,985,937 Shares under restricted share units Unissued ordinary shares of BidEnergy Limited under restricted share units (“RSUs”) at the date of this report are as follows: Class Unlisted Class B Unlisted Class C Grant date Expiry 08/04/20 07/04/23 12/06/20 12/06/21 Exercise price – – Number of RSUs 283,839 68,625 352,464 40 Bid Annual Report 2020 Directors’ report continued Shares issued on the conversion of restricted share units The following ordinary shares of BidEnergy Limited were issued during the year ended 30 June 2020 and up to the date of this report on the conversion of restricted share units: Date restricted share units granted Class Conversion price Number of shares issued 08/02/2019 Unlisted Class A restricted share units – 1,073,000 Shares under performance rights Unissued ordinary shares of BidEnergy Limited under performance rights at the date of this report are as follows: Class Unlisted Class G Unlisted Class H Unlisted Class I Unlisted Class K Unlisted Class L Unlisted Class M Grant date Expiry date 25/03/20 25/06/21 08/04/20 07/04/23 08/04/20 07/04/23 12/06/20 12/06/20 13/07/20 12/06/21 12/06/21 13/07/21 Exercise price Number under rights – – – – – – 161,606 567,501 91,617 148,969 54,651 174,424 1,198,768 No person entitled to exercise the performance rights had or has any right by virtue of the performance right to participate in any share issue of the Company or of any other body corporate. Shares issued on the exercise of performance rights The following ordinary shares of BidEnergy Limited were issued during the year ended 30 June 2020 and up to the date of this report on the exercise of performance rights granted: Date performance rights granted Class 01/07/16 27/05/19 12/05/20 Unlisted Class E Unlisted Class F Unlisted Class J Exercise price Number of shares issued – – – 2,250,198 110,000 105,887 2,466,085 Indemnity and insurance of officers The Consolidated Entity has indemnified the directors and executives of the Consolidated Entity for costs incurred, in their capacity as a director or executive, for which they may be held personally liable, except where there is a lack of good faith. During the financial year, the Consolidated Entity paid a premium in respect of a contract to insure the directors and executives of the Consolidated Entity against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium. Indemnity and insurance of auditor The Consolidated Entity has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the Consolidated Entity or any related entity against a liability incurred by the auditor. During the financial year, the Consolidated Entity has not paid a premium in respect of a contract to insure the auditor of the Consolidated Entity or any related entity. 41 Directors’ report continued Proceedings on behalf of the Consolidated Entity On 26 July 2019, the Company announced that it received notice that Mr James Baillieu has made an application in the Supreme Court of Melbourne for an order to commence proceedings on behalf of the Company under Section 236 of the Corporations Act 2001 against certain of the Company’s directors at the time, being Andrew Dyer, Guy Maine and Leanne Graham. On 16 March 2020, the Company announced that it had resolved the proceeding issued by Mr James Baillieu, pursuant to a confidential settlement agreement between Mr James Baillieu, the Company, and others dated 13 March 2020, and without any admission of liability. As at 30 June 2020 and to the date of this report, no person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the Consolidated Entity, or to intervene in any proceedings to which the Consolidated Entity is a party for the purpose of taking responsibility on behalf of the Consolidated Entity for all or part of those proceedings. Non-audit services Details of the amounts paid or payable to the auditor for non‑audit services provided during the financial year by the auditor are outlined in note 26 to the financial statements. The Directors are satisfied that the provision of non‑audit services during the financial year, by the auditor (or by another person or firm on the auditor’s behalf), is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The Directors are of the opinion that the services as disclosed in note 26 to the financial statements do not compromise the external auditor’s independence requirements of the Corporations Act 2001 for the following reasons: • all non‑audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of the auditor; and • none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants issued by the Accounting Professional and Ethical Standards Board, including reviewing or auditing the auditor’s own work, acting in a management or decision‑making capacity for the Company, acting as advocate for the Company or jointly sharing economic risks and rewards. Officers of the Consolidated Entity who are former partners of RSM Australia Partners There are no officers of the Consolidated Entity who are former partners of RSM Australia Partners. Auditor’s independence declaration A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this Directors’ report. Auditor RSM Australia Partners continues in office in accordance with section 327 of the Corporations Act 2001. This report is made in accordance with a resolution of Directors, pursuant to section 298(2)(a) of the Corporations Act 2001. On behalf of the Directors Geoffrey Kleemann Interim Chairman 26 August 2020 42 Bid Annual Report 2020 Auditor’s independence declaration RSM Australia Partners Level 21, 55 Collins Street Melbourne VIC 3000 PO Box 248 Collins Street West VIC 8007 T +61 (0) 3 9286 8000 F +61 (0) 3 9286 8199 www.rsm.com.au AUDITOR’S INDEPENDENCE DECLARATION As lead auditor for the audit of the financial report of BidEnergy Limited for the year ended 30 June 2020, I declare that, to the best of my knowledge and belief, there have been no contraventions of: (i) (ii) the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and any applicable code of professional conduct in relation to the audit. RSM AUSTRALIA PARTNERS B Y CHAN Partner Dated: 26 August 2020 Melbourne, Victoria THE POWER OF BEING UNDERSTOOD AUDIT | TAX | CONSULTING 20 RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction. RSM Australia Partners ABN 36 965 185 036 Liability limited by a scheme approved under Professional Standards Legislation 43 Statement of profit or loss and other comprehensive income For the year ended 30 June 2020 Revenue Other income Expenses Third party support and development costs Depreciation and amortisation expense Employee benefits expense Share based payments Administration expense Marketing expense Occupancy expense Travel expense Finance costs Loss before income tax (expense)/benefit Income tax (expense)/benefit Loss after income tax (expense)/benefit for the year attributable to the owners of BidEnergy Limited Other comprehensive income Items that may be reclassified subsequently to profit or loss Foreign currency translation Other comprehensive income for the year, net of tax Total comprehensive income for the year attributable to the owners of BidEnergy Limited Basic earnings per share Diluted earnings per share Note 5 6 7 Consolidated 2020 $ 2019 $ 9,387,568 5,304,110 90,421 140,228 (2,231,235) (1,253,374) (1,059,315) (542,858) (7,939,874) (5,471,025) 35 (2,166,962) (2,540,114) (1,753,472) (1,388,034) (374,719) (243,702) (628,401) (388,236) (211,587) (212,164) (5,415) (4,788) (6,892,991) (6,599,957) (17,720) 33,552 (6,910,711) (6,566,405) 19,758 19,758 69,552 69,552 (6,890,953) (6,496,853) Cents (5.52) (5.52) Cents (6.00) (6.00) 7 8 34 34 The above statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes. 44 Bid Annual Report 2020 Statement of financial position As at 30 June 2020 Assets Current assets Cash and cash equivalents Trade and other receivables Financial assets at amortised cost Right–of–use assets Other current assets Total current assets Non–current assets Property, plant and equipment Intangibles Other Total non–current assets Total assets Liabilities Current liabilities Trade and other payables Borrowings Lease liabilities Employee benefits Other Total current liabilities Non–current liabilities Borrowings Deferred tax liabilities Employee benefits Total non–current liabilities Total liabilities Net assets Equity Issued capital Reserves Accumulated losses Total equity Consolidated 2020 $ 2019 $ Note 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 8,295,916 4,198,978 470,050 37,500 36,196 287,745 37,500 165,202 662,971 9,004,864 5,187,194 45,843 40,514 2,464,748 2,198,309 30,482 70,008 2,541,073 2,308,831 11,545,937 7,496,025 1,129,279 748,090 101,735 38,186 526,665 362,375 – – 317,362 182,162 2,158,240 1,247,614 249,556 134,574 136,449 520,579 – 165,719 92,793 258,512 2,678,819 1,506,126 8,867,118 5,989,899 37,006,753 25,797,430 1,882,635 3,714,150 (30,022,270) (23,521,681) 8,867,118 5,989,899 The above statement of financial position should be read in conjunction with the accompanying notes. 45 Statement of changes in equity For the year ended 30 June 2020 Consolidated Balance at 1 July 2018 Loss after income tax benefit for the year Other comprehensive income for the year, net of tax Total comprehensive income for the year Transactions with owners in their capacity as owners: Issued Capital $ Accumulated Losses $ Reserves $ Total Equity $ 22,360,257 (16,955,276) 1,104,484 6,509,465 – – – (6,566,405) 69,552 – – (6,566,405) 69,552 (6,566,405) 69,552 (6,496,853) Contributions of equity, net of transaction costs (note 22) 3,303,489 Shares issued to RWW vendors for earn out settlement 133,684 – – Share based payments Balance at 30 June 2019 Consolidated Balance at 1 July 2019 Loss after income tax expense for the year Other comprehensive income for the year, net of tax Total comprehensive income for the year Transactions with owners in their capacity as owners: – – – 3,303,489 133,684 2,540,114 – 2,540,114 25,797,430 (23,521,681) 3,714,150 5,989,899 Issued Capital $ Accumulated Losses $ Reserves $ Total Equity $ 25,797,430 (23,521,681) 3,714,150 5,989,899 – – – (6,910,711) 19,758 – – (6,910,711) 19,758 (6,910,711) 19,758 (6,890,953) Contributions of equity, net of transaction costs (note 22) 6,290,365 Share‑based payments (note 35) 153,126 – – – 6,290,365 2,013,836 2,166,962 Transfers Exercise of options Conversion of performance rights Conversion of restricted share units – 410,122 (410,122) – 1,310,845 1,759,647 1,695,340 – – – – 1,310,845 (1,759,647) (1,695,340) – – Balance at 30 June 2020 37,006,753 (30,022,270) 1,882,635 8,867,118 The above statement of changes in equity should be read in conjunction with the accompanying notes. 46 Bid Annual Report 2020 Statement of Cash Flows For the year ended 30 June 2020 Cash flows from operating activities Receipts from customers (inclusive of GST) Payments to suppliers and employees (inclusive of GST) Receipts from research and development incentive Receipts from other government grants Interest received Net cash used in operating activities Cash flows from investing activities Payments for property, plant and equipment Payments for intangibles (capitalised development costs) Receipts from research and development incentive (offset against capitalised development costs) Payments for security deposits Net cash used in investing activities Cash flows from financing activities Proceeds from issue of shares Share issue costs Proceeds from borrowings Repayment of lease liabilities Net cash from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the financial year Effects of exchange rate changes on cash and cash equivalents Consolidated 2020 $ 2019 $ Note 9,858,629 5,502,945 (13,032,031) (8,753,476) – 82,880 50,000 35,005 – 52,561 33 (3,088,397) (3,115,090) 13 14 14 (32,981) (27,983) (1,162,580) (1,019,496) – 391,575 (51,024) – (1,246,585) (655,904) 22 8,709,993 2,686,856 (500,096) 371,931 (147,559) – – – 8,434,269 2,686,856 4,099,287 (1,084,138) 4,198,978 5,275,956 (2,349) 7,160 Cash and cash equivalents at the end of the financial year 9 8,295,916 4,198,978 The above statement of cash flows should be read in conjunction with the accompanying notes. 47 Notes to the financial statements 30 June 2020 Note 1. General information The financial statements cover BidEnergy Limited as a Consolidated Entity consisting of BidEnergy Limited and the entities it controlled at the end of, or during, the year. The financial statements are presented in Australian dollars, which is BidEnergy Limited’s functional and presentation currency. BidEnergy Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and principal place of business are: Registered office Level 19, 15 William Street Melbourne, Victoria 3000 Principal place of business Level 19, 15 William Street Melbourne, Victoria 3000 A description of the nature of the Consolidated Entity’s operations and its principal activities are included in the Directors’ report, which is not part of the financial statements. The financial statements were authorised for issue, in accordance with a resolution of Directors, on 26 August 2020. Note 2. Significant accounting policies The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. New or amended Accounting Standards and Interpretations adopted The Consolidated Entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (‘AASB’) that are mandatory for the current reporting period. Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted. The following Accounting Standards and Interpretations are most relevant to the Consolidated Entity: AASB 16 Leases The consolidated entity has adopted AASB 16 from 1 July 2019. The standard replaces AASB 117 ‘Leases’ and for lessees eliminates the classifications of operating leases and finance leases. Except for short‑term leases and leases of low value assets, right‑of‑use assets and corresponding lease liabilities are recognised in the statement of financial position. Straight line operating lease expense recognition is replaced with a depreciation charge for the right‑of‑use assets (included in operating costs) and an interest expense on the recognised lease liabilities (included in finance costs). In the earlier periods of the lease, the expenses associated with the lease under AASB 16 will be higher when compared to lease expenses under AASB 117. However, EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) results improve as the operating expense is now replaced by interest expense and depreciation in profit or loss. For classification within the statement of cash flows, the interest portion is disclosed in operating activities and the principal portion of the lease payments are separately disclosed in financing activities. For lessor accounting, the standard does not substantially change how a lessor accounts for leases. Impact on application The Consolidated Entity has adopted AASB 16 using the modified retrospective approach. Accordingly, the Consolidated Entity has not restated comparative balances in this set of financial statements. On adoption of AASB 16, the consolidated entity recognised lease liabilities in relation to leases which had previously been classified as ‘operating leases’ under the principles of AASB 117 Leases. These liabilities were measured at the present value of the remaining lease payments, discounted using the lessee’s incremental borrowing rate as of 1 July 2019. The weighted average incremental borrowing rate applied to the lease liabilities on 1 July 2019 was 4.32%. The associated right‑ of‑use assets for these leases were measured on a retrospective basis as if AASB 16 had always been applied, with the incremental borrowing rate applied as at each lease’s commencement date and the assets depreciated on a straight‑line basis over the term of the lease. The provisions recognised in respect of onerous lease contracts were netted off against the associated right‑of‑use assets at the date of transition. 48 Bid Annual Report 2020 Notes to the financial statements continued Operating lease commitments as at 1 July 2019 (AASB 117) Operating lease commitments discount based on the weighted average incremental borrowing rate of 4.32% (AASB 16) Short‑term leases not recognised as a right‑of‑use asset (AASB 16) Right‑of‑use assets (AASB 16) Lease liabilities – current (AASB 16) Adjusted opening as at 1 July 2019 under AASB 16 $ 251,030 (1,715) (111,159) 138,156 (138,156) AASB Interpretation 23 Uncertainty over Income Tax Treatments Interpretation 23 requires the assessment of whether the effect of uncertainty over income tax treatments should be included in the determination of taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates. The Interpretation outlines the requirements to determine whether an entity considers uncertain tax treatments separately, the assumptions an entity makes about the examination of tax treatments by taxation authorities, how an entity determines taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates and how an entity considers changes in facts and circumstances. The Company has adopted Interpretation 23 from 1 July 2019, based on an assessment of whether it is ‘probable’ that a taxation authority will accept an uncertain tax treatment. This assessment takes into account that for certain jurisdictions in which the company operates, a local tax authority may seek to open a company’s books as far back as inception of the company. Where it is probable, the company has determined tax balances consistently with the tax treatment used or planned to be used in its income tax filings. Where the company has determined that it is not probable that the taxation authority will accept an uncertain tax treatment, the most likely amount or the expected value has been used in determining taxable balances (depending on which method is expected to better predict the resolution of the uncertainty). There has been no impact from the adoption of Interpretation 23 in this reporting period. Basis of preparation These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (‘AASB’) and the Corporations Act 2001, as appropriate for for‑profit oriented entities. These financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board (‘IASB’). Historical cost convention The financial statements have been prepared under the historical cost convention, except for, where applicable, the revaluation of financial assets and liabilities at fair value through profit or loss, financial assets at fair value through other comprehensive income, investment properties, certain classes of property, plant and equipment and derivative financial instruments. Critical accounting estimates The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Consolidated Entity’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 3. 49 Notes to the financial statements continued Note 2. Significant accounting policies (continued) Parent entity information In accordance with the Corporations Act 2001, these financial statements present the results of the Consolidated Entity only. Supplementary information about the Parent Entity is disclosed in note 30. Principles of consolidation The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of BidEnergy Limited (‘Company’ or ‘Parent Entity’) as at 30 June 2020 and the results of all subsidiaries for the year then ended. BidEnergy Limited and its subsidiaries together are referred to in these financial statements as the ‘Consolidated Entity’. Subsidiaries are all those entities over which the Consolidated Entity has control. The Consolidated Entity controls an entity when the Consolidated Entity is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Consolidated Entity. They are de‑consolidated from the date that control ceases. Intercompany transactions, balances and unrealised gains on transactions between entities in the Consolidated Entity are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Consolidated Entity. The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in ownership interest, without the loss of control, is accounted for as an equity transaction, where the difference between the consideration transferred and the book value of the share of the non‑controlling interest acquired is recognised directly in equity attributable to the parent. Where the Consolidated Entity loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and non‑controlling interest in the subsidiary together with any cumulative translation differences recognised in equity. The Consolidated Entity recognises the fair value of the consideration received and the fair value of any investment retained together with any gain or loss in profit or loss. Operating segments Operating segments are presented using the ‘management approach’, where the information presented is on the same basis as the internal reports provided to the Chief Operating Decision Makers (‘CODM’). The CODM is responsible for the allocation of resources to operating segments and assessing their performance. Foreign currency translation The financial statements are presented in Australian dollars, which is BidEnergy Limited’s functional and presentation currency. Foreign currency transactions Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at financial year‑end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss. Foreign operations The assets and liabilities of foreign operations are translated into Australian dollars using the exchange rates at the reporting date. The revenues and expenses of foreign operations are translated into Australian dollars using the average exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences are recognised in other comprehensive income through the foreign currency reserve in equity. The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed of. 50 Bid Annual Report 2020 Notes to the financial statements continued Revenue recognition The Consolidated Entity recognises revenue as follows: Revenue from contracts with customers Revenue is recognised at an amount that reflects the consideration to which the Consolidated Entity is expected to be entitled in exchange for transferring goods or services to a customer. For each contract with a customer, the Consolidated Entity: identifies the contract with a customer; identifies the performance obligations in the contract; determines the transaction price which takes into account estimates of variable consideration and the time value of money; allocates the transaction price to the separate performance obligations on the basis of the relative stand‑alone selling price of each distinct good or service to be delivered; and recognises revenue when or as each performance obligation is satisfied in a manner that depicts the transfer to the customer of the goods or services promised. Variable consideration within the transaction price, if any, reflects concessions provided to the customer such as discounts, rebates and refunds, any potential bonuses receivable from the customer and any other contingent events. Such estimates are determined using either the ‘expected value’ or ‘most likely amount’ method. The measurement of variable consideration is subject to a constraining principle whereby revenue will only be recognised to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognised will not occur. The measurement constraint continues until the uncertainty associated with the variable consideration is subsequently resolved. Amounts received that are subject to the constraining principle are recognised as a refund liability. Platform subscription fees Platform subscription fee revenue is recognised over the period to which the customer receives services, once the performance obligations are satisfied and there is a valid sales contract. Amounts disclosed as revenue are net of sales returns and trade discounts. US energy rebate revenue US energy rebate revenue is recognised at the point where cash rebates are received from utility providers, the performance obligations are satisfied and there is a valid sales contract. Amounts disclosed as revenue are net of sales returns and trade discounts. Non‑subscription revenue Non‑subscription revenue from energy spend review services is recognised by reference to the stage of completion of the contracts. Stage of completion is measured by reference to labour hours incurred to date as a percentage of total estimated labour hours for each contract. Where the contract outcome cannot be reliably estimated, revenue is only recognised to the extent of the recoverable costs incurred to date. Interest Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying amount of the financial asset. Other revenue Other revenue is recognised when it is received or when the right to receive payment is established. 51 Notes to the financial statements continued Note 2. Significant accounting policies (continued) Income tax The income tax expense or benefit for the period is the tax payable on that period’s taxable income based on the applicable income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to temporary differences, unused tax losses and the adjustment recognised for prior periods, where applicable. Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for: • When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor taxable profits; or • When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and the timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable that there are future taxable profits available to recover the asset. Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on either the same taxable entity or different taxable entities which intend to settle simultaneously. Current and non-current classification Assets and liabilities are presented in the statement of financial position based on current and non‑current classification. An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Consolidated Entity’s normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period. All other assets are classified as non‑current. A liability is classified as current when: it is either expected to be settled in the Consolidated Entity’s normal operating cycle; it is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities are classified as non‑current. Deferred tax assets and liabilities are always classified as non‑current. Cash and cash equivalents Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short‑term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Trade and other receivables Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 30 days. The Consolidated Entity has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue. Other receivables are recognised at amortised cost, less any allowance for expected credit losses. 52 Bid Annual Report 2020 Notes to the financial statements continued Investments and other financial assets Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at either amortised cost or fair value depending on their classification. Classification is determined based on both the business model within which such assets are held and the contractual cash flow characteristics of the financial asset unless an accounting mismatch is being avoided. Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the Consolidated Entity has transferred substantially all the risks and rewards of ownership. When there is no reasonable expectation of recovering part or all of a financial asset, it’s carrying value is written off. Financial assets at fair value through profit or loss Financial assets not measured at amortised cost or at fair value through other comprehensive income are classified as financial assets at fair value through profit or loss. Typically, such financial assets will be either: (i) held for trading, where they are acquired for the purpose of selling in the short‑term with an intention of making a profit, or a derivative; or (ii) designated as such upon initial recognition where permitted. Fair value movements are recognised in profit or loss. Impairment of financial assets The Consolidated Entity recognises a loss allowance for expected credit losses on financial assets which are either measured at amortised cost or fair value through other comprehensive income. The measurement of the loss allowance depends upon the Consolidated Entity’s assessment at the end of each reporting period as to whether the financial instrument’s credit risk has increased significantly since initial recognition, based on reasonable and supportable information that is available, without undue cost or effort to obtain. Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12‑month expected credit loss allowance is estimated. This represents a portion of the asset’s lifetime expected credit losses that is attributable to a default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where it is determined that credit risk has increased significantly, the loss allowance is based on the asset’s lifetime expected credit losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate. For financial assets mandatorily measured at fair value through other comprehensive income, the loss allowance is recognised in other comprehensive income with a corresponding expense through profit or loss. In all other cases, the loss allowance reduces the asset’s carrying value with a corresponding expense through profit or loss. Plant and equipment Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Depreciation is calculated on a straight‑line basis to write off the net cost of each item of property, plant and equipment (excluding land) over their expected useful lives as follows: Computer equipment Office equipment 2‑5years 2‑5 years The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date. An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the Consolidated Entity. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss. 53 Notes to the financial statements continued Note 2. Significant accounting policies (continued) Right-of-use assets A right‑of‑use asset is recognised at the commencement date of a lease. The right‑of‑use asset is measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the site or asset. Right‑of‑use assets are depreciated on a straight‑line basis over the unexpired period of the lease or the estimated useful life of the asset, whichever is the shorter. Where the Consolidated Entity expects to obtain ownership of the leased asset at the end of the lease term, the depreciation is over its estimated useful life. Right‑of use assets are subject to impairment or adjusted for any remeasurement of lease liabilities. The Consolidated Entity has elected not to recognise a right‑of‑use asset and corresponding lease liability for short‑term leases with terms of 12 months or less and leases of low‑value assets. Lease payments on these assets are expensed to profit or loss as incurred. Intangible assets Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value at the date of the acquisition. Intangible assets acquired separately are initially recognised at cost. Indefinite life intangible assets are not amortised and are subsequently measured at cost less any impairment. Finite life intangible assets are subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit or loss arising from the derecognition of intangible assets are measured as the difference between net disposal proceeds and the carrying amount of the intangible asset. The method and useful lives of finite life intangible assets are reviewed annually. Changes in the expected pattern of consumption or useful life are accounted for prospectively by changing the amortisation method or period. Goodwill Goodwill arises on the acquisition of a business. Goodwill is not amortised. Instead, goodwill is tested annually for impairment, or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses. Impairment losses on goodwill are taken to profit or loss and are not subsequently reversed. Customer lists Customer lists acquired in a business combination are amortised on a straight‑line basis over the period of their expected benefit, being their finite life of 7.5 years. Software Significant costs associated with software are deferred and amortised on a straight‑line basis over the period of their expected benefit, being their finite life of 2 – 5 years. Capitalised development costs Software development costs are capitalised at the direct costs incurred and amortised on a straight line basis over the period of their expected benefit being their finite life of 2‑3 years. Amortisation starts at the time that the technology is activated and issued by both internal and external customers. The capitalised costs include the direct costs of internal staff and any supporting software acquired from a third party. Brand The brand of an entity arises on the acquisition of a business. The brand is amortised on a straight‑line basis over the period of their expected benefit, being their finite life of 7.5 years. 54 Bid Annual Report 2020 Notes to the financial statements continued Impairment of non-financial assets Goodwill and other intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other non‑financial assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. Recoverable amount is the higher of an asset’s fair value less costs of disposal and value‑in‑use. The value‑in‑use is the present value of the estimated future cash flows relating to the asset using a pre‑tax discount rate specific to the asset or cash‑generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to form a cash‑generating unit. Trade and other payables These amounts represent liabilities for goods and services provided to the Consolidated Entity prior to the end of the financial year and which are unpaid. Due to their short‑term nature they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition. Borrowings Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They are subsequently measured at amortised cost using the effective interest method. Lease liabilities A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Consolidated Entity’s incremental borrowing rate. Lease payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or a rate are expensed in the period in which they are incurred. Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured if there is a change in the following: future lease payments arising from a change in an index or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an adjustment is made to the corresponding right‑of use asset, or to profit or loss if the carrying amount of the right‑of‑use asset is fully written down. Finance costs Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed in the period in which they are incurred. Employee benefits Short‑term employee benefits Liabilities for wages and salaries, including non‑monetary benefits, annual leave and long service leave expected to be settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities are settled. Other long‑term employee benefits The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are measured at the present value of expected future payments to be made in respect of services provided by employees up to the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on high quality corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows. 55 Notes to the financial statements continued Note 2. Significant accounting policies (continued) Employee benefits (continued) Share‑based payments Equity‑settled and cash‑settled share‑based compensation benefits are provided to employees. Equity‑settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the rendering of services. Cash‑settled transactions are awards of cash for the exchange of services, where the amount of cash is determined by reference to the share price. The cost of equity‑settled transactions are measured at fair value on grant date. Fair value is independently determined using either the Binomial or Black‑Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option, together with non‑vesting conditions that do not determine whether the Consolidated Entity receives the services that entitle the employees to receive payment. No account is taken of any other vesting conditions. The cost of equity‑settled transactions are recognised as an expense with a corresponding increase in equity over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous periods. The cost of cash‑settled transactions is initially, and at each reporting date until vested, determined by applying either the Binomial or Black‑Scholes option pricing model, taking into consideration the terms and conditions on which the award was granted. The cumulative charge to profit or loss until settlement of the liability is calculated as follows: • during the vesting period, the liability at each reporting date is the fair value of the award at that date multiplied by the expired portion of the vesting period; and • from the end of the vesting period until settlement of the award, the liability is the full fair value of the liability at the reporting date. All changes in the liability are recognised in profit or loss. The ultimate cost of cash‑settled transactions is the cash paid to settle the liability. Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are satisfied. If equity‑settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of the share‑based compensation benefit as at the date of modification. If the non‑vesting condition is within the control of the Consolidated Entity or employee, the failure to satisfy the condition is treated as a cancellation. If the condition is not within the control of the Consolidated Entity or employee and is not satisfied during the vesting period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited. If equity‑settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award is treated as if they were a modification. Fair value measurement When an asset or liability, financial or non‑financial, is measured at fair value for recognition or disclosure purposes, the fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; and assumes that the transaction will take place either: in the principal market; or in the absence of a principal market, in the most advantageous market. Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming they act in their economic best interests. For non‑financial assets, the fair value measurement is based on its highest and best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, are used, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. 56 Bid Annual Report 2020 Notes to the financial statements continued Issued capital Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Business combinations The acquisition method of accounting is used to account for business combinations regardless of whether equity instruments or other assets are acquired. The consideration transferred is the sum of the acquisition‑date fair values of the assets transferred, equity instruments issued or liabilities incurred by the acquirer to former owners of the acquiree and the amount of any non‑controlling interest in the acquiree. For each business combination, the non‑controlling interest in the acquiree is measured at either fair value or at the proportionate share of the acquiree’s identifiable net assets. All acquisition costs are expensed as incurred to profit or loss. On the acquisition of a business, the Consolidated Entity assesses the financial assets acquired and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic conditions, the Consolidated Entity’s operating or accounting policies and other pertinent conditions in existence at the acquisition‑date. Where the business combination is achieved in stages, the Consolidated Entity remeasures its previously held equity interest in the acquiree at the acquisition‑date fair value and the difference between the fair value and the previous carrying amount is recognised in profit or loss. Contingent consideration to be transferred by the acquirer is recognised at the acquisition‑date fair value. Subsequent changes in the fair value of the contingent consideration classified as an asset or liability is recognised in profit or loss. Contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity. The difference between the acquisition‑date fair value of assets acquired, liabilities assumed and any non‑controlling interest in the acquiree and the fair value of the consideration transferred and the fair value of any pre‑existing investment in the acquiree is recognised as goodwill. If the consideration transferred and the pre‑existing fair value is less than the fair value of the identifiable net assets acquired, being a bargain purchase to the acquirer, the difference is recognised as a gain directly in profit or loss by the acquirer on the acquisition‑date, but only after a reassessment of the identification and measurement of the net assets acquired, the non‑controlling interest in the acquiree, if any, the consideration transferred and the acquirer’s previously held equity interest in the acquirer. Business combinations are initially accounted for on a provisional basis. The acquirer retrospectively adjusts the provisional amounts recognised and also recognises additional assets or liabilities during the measurement period, based on new information obtained about the facts and circumstances that existed at the acquisition‑date. The measurement period ends on either the earlier of (i) 12 months from the date of the acquisition or (ii) when the acquirer receives all the information possible to determine fair value. Earnings per share Basic earnings per share Basic earnings per share is calculated by dividing the profit attributable to the owners of BidEnergy Limited, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the financial year. Diluted earnings per share Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares. 57 Notes to the financial statements continued Note 2. Significant accounting policies (continued) Goods and Services Tax (‘GST’) and other similar taxes Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the tax authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part of the expense. Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the tax authority is included in other receivables or other payables in the statement of financial position. Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the tax authority, are presented as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the tax authority. Funds held in trust The Company holds funds and pays utility bills on behalf of its clients. These funds do not meet the definition of an asset, therefore it is not recognised in the statement of financial position. New Accounting Standards and Interpretations not yet mandatory or early adopted Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the Consolidated Entity for the annual reporting period ended 30 June 2020. The Consolidated Entity has not yet assessed the impact of these new or amended Accounting Standards and Interpretations. Note 3. Critical accounting judgements, estimates and assumptions The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below. Coronavirus (COVID-19) pandemic Judgement has been exercised in considering the impacts that the Coronavirus (COVID‑19) pandemic has had, or may have, on the Consolidated Entity based on known information. This consideration extends to the nature of the products and services offered, customers, supply chain, staffing and geographic regions in which the Consolidated Entity operates. Other than as addressed in specific notes, there does not currently appear to be either any significant impact upon the financial statements or any significant uncertainties with respect to events or conditions which may impact the Consolidated Entity unfavourably as at the reporting date or subsequently as a result of the Coronavirus (COVID‑19) pandemic. Share-based payment transactions The Consolidated Entity measures the cost of equity‑settled transactions with employees 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 either the Binomial or Black‑ Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions relating to equity‑settled share‑based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact profit or loss and equity. Allowance for expected credit losses The allowance for expected credit losses assessment requires a degree of estimation and judgement. It is based on the lifetime expected credit loss, grouped based on days overdue, and makes assumptions to allocate an overall expected credit loss rate for each group. These assumptions include recent sales experience and historical collection rates. 58 Bid Annual Report 2020 Notes to the financial statements continued Note 3. Critical accounting judgements, estimates and assumptions (continued) Estimation of useful lives of assets The Consolidated Entity determines the estimated useful lives and related depreciation and amortisation charges for its property, plant and equipment and finite life intangible assets. The useful lives could change significantly as a result of technical innovations or some other event. The depreciation and amortisation charge will increase where the useful lives are less than previously estimated lives, or technically obsolete or non‑strategic assets that have been abandoned or sold will be written off or written down. Goodwill and other indefinite life intangible assets The Consolidated Entity tests annually, or more frequently if events or changes in circumstances indicate impairment, whether goodwill and other indefinite life intangible assets have suffered any impairment, in accordance with the accounting policy stated in note 2. The recoverable amounts of cash‑generating units have been determined based on value‑in‑use calculations. These calculations require the use of assumptions, including estimated discount rates based on the current cost of capital and growth rates of the estimated future cash flows. Impairment of non-financial assets other than goodwill and other indefinite life intangible assets The Consolidated Entity assesses impairment of non‑financial assets other than goodwill and other indefinite life intangible assets at each reporting date by evaluating conditions specific to the Consolidated Entity and to the particular asset that may lead to impairment. If an impairment trigger exists, the recoverable amount of the asset is determined. This involves fair value less costs of disposal or value‑in‑use calculations, which incorporate a number of key estimates and assumptions. Income tax The Consolidated Entity is subject to income taxes in the jurisdictions in which it operates. Significant judgement is required in determining the provision for income tax. There are many transactions and calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. The Consolidated Entity recognises liabilities for anticipated tax audit issues based on the Consolidated Entity’s current understanding of the tax law. Where the final tax outcome of these matters is different from the carrying amounts, such differences will impact the current and deferred tax provisions in the period in which such determination is made. Recovery of deferred tax assets Deferred tax assets are recognised for deductible temporary differences only if the Consolidated Entity considers it is probable that future taxable amounts will be available to utilise those temporary differences and losses. Employee benefits provision As discussed in note 2, the liability for employee benefits expected to be settled more than 12 months from the reporting date are recognised and measured at the present value of the estimated future cash flows to be made in respect of all employees at the reporting date. In determining the present value of the liability, estimates of attrition rates and pay increases through promotion and inflation have been taken into account. Note 4. Operating segments Identification of reportable operating segments The Consolidated Entity is organised into operating segments based on the business activities in Australia, UK and USA. These operating segments are based on the internal reports that are reviewed and used by the Board of Directors (who are identified as the Chief Operating Decision Makers (‘CODM’)) in assessing performance and in determining the allocation of resources. 59 Notes to the financial statements continued Note 4. Operating segments (continued) Basis of accounting for purposes of reporting by operating segments Accounting policies adopted Unless stated otherwise, all amounts reported to the Board of Directors as the chief decision maker with respect to operating segments are determined in accordance with accounting policies that are consistent with those adopted in the last annual financial statements of the Combined entity. The principal continuing activities of the entity consisted of carrying on its business as a provider of energy spend management services through the deployment of the Company’s proprietary cloud‑based software platform in Australia, UK and the USA. In the US only, the entity also earns revenue from its rebate management business whereby fees are earned from clients for managing the submission of information to energy retailers to facilitate the processing of rebates under the ‘Energy Efficient Infrastructure Program’ applicable in the US. Operating segment information Consolidated – 2020 Platform subscription fees Non‑subscription revenue US energy rebate revenue Revenue Australia $ UK $ USA $ Total $ 4,302,914 225,742 338,651 4,867,307 94,485 – 5,023 99,508 – 4,420,753 – 4,420,753 4,397,399 225,742 4,764,427 9,387,568 Intersegment sales/management charges 1,304,237 (669,054) (635,183) – Third party support and development costs (1,936,355) (130,560) (164,320) (2,231,235) Administration expense Employee benefits expense Marketing expense Travel expense Occupancy expense (1,400,899) (27,549) (286,049) (1,714,497) (6,035,958) (633,178) (2,433,318) (9,102,454) (116,389) (137,244) (550,231) (15,493) (242,837) (374,719) (41,250) (26,201) (33,093) (211,587) (51,969) (628,401) Total operating expenses (10,177,076) (874, 231) (3, 211,586) (14, 262,893) Underlying EBITDA from core operations (4,475,440) (1,317,543) 917,658 (4,875,325) Government grants Capitalised labour (software) Depreciation and amortisation Share based payments Interest – other Finance costs Foreign exchange 50,000 1,162,580 – – – – 50,000 1,162,580 (834,582) (964) (223,769) (1,059,315) (2,166,962) 36,958 (2,480) (5,289) – – – (31,142) – (2,166,962) 3,463 (2,935) (2,544) 40,421 (5,415) (38,975) Loss before income tax benefit for the year (6, 235, 215) (1,349,649) 691,873 (6,892,991) Income tax – – (17,720) (17,720) Loss after income tax benefit for the year attributable to the owners of BidEnergy Limited (6, 235, 215) (1,349,649) 674,153 (6,910,711) 60 Bid Annual Report 2020 Notes to the financial statements continued AASB 16 Leases was adopted for the first time requiring capitalisation and amortisation of the company’s US office lease. The modified retrospective approach was used and as such the comparatives have not been restated. Therefore, the current and comparative EBITDA are not directly comparable, the difference being June 2019 recorded rent expense of $105,770 in underlying EBITDA. June 2020 recorded no rent expense, and lease amortisation of $111,363 which was included below EBITDA level. Consolidated – 2019 Platform subscription fees Non‑subscription revenue US energy rebate revenue Revenue Australia $ UK $ USA $ Total $ 2,697,784 44,207 181,950 2,923,941 27,080 – – 2,353,089 – – 27,080 2,353,089 2,724,864 44, 207 2,535,039 5,304,110 Third party support and development costs (1,090,396) – (162,978) (1,253,374) Administration expense Employee benefits expense Marketing expense Travel expense Occupancy expense (1,030,166) (23,612) (324,256) (1,378,034) (4,381,297) (254,841) (1,854,384) (6,490,522) (108,399) (151,629) (221,071) (37,718) (15,537) (97,585) (243,702) (44,998) (212,164) – (167,165) (388,236) Total operating expenses (6,982,958) (331,708) (2,651,366) (9,966,032) Underlying EBITDA from core operations (4, 258,094) (287,501) (116,327) (4,661,922) Government grants Capitalised labour (software) Depreciation and amortisation Share based payments Interest – other Finance costs Foreign exchange 82,880 1,019,497 (415,264) (2,540,114) 56,229 (4,788) (14,445) – – – – – – 4,445 – – 82,880 1,019,497 (127,594) (542,858) – 1,119 – – (2,540,114) 57,348 (4,788) (10,000) Loss before income tax benefit for the year (6,074,099) (283,056) (242,802) (6,599,957) Income tax – – 33,552 33,552 Loss after income tax benefit for the year attributable to the owners of BidEnergy Limited (6,074,099) (283,056) (209, 250) (6,566,405) 61 Notes to the financial statements continued Note 5. Revenue Platform subscription fees Non‑subscription revenue US energy rebate revenue Revenue Disaggregation of revenue The disaggregation of revenue from contracts with customers is as follows: Major product lines Platform subscription fees Non‑subscription revenue US energy rebate revenue Geographical regions Australia USA UK Timing of revenue recognition Services transferred over time Services transferred at point in time 62 Bid Annual Report 2020 Consolidated 2020 $ 2019 $ 4,867,307 2,923,941 99,508 27,080 4,420,753 2,353,089 9,387,568 5,304,110 Consolidated 2020 $ 2019 $ 4,867,307 2,923,941 99,508 27,080 4,420,753 2,353,089 9,387,568 5,304,110 Consolidated 2020 $ 2019 $ 4,397,399 2,724,864 4,764,427 2,535,039 225,742 44,207 9,387,568 5,304,110 Consolidated 2020 $ 2019 $ 4,867,307 2,923,941 4,520,261 2,380,169 9,387,568 5,304,110 Notes to the financial statements continued Note 6. Other income Interest Grant income Other income Note 7. Expenses Loss before income tax includes the following specific expenses: Depreciation Computer equipment Office equipment Buildings right‑of‑use assets Total depreciation Amortisation Software Brands Customer List Total amortisation Total depreciation and amortisation Finance costs Interest on insurance funding Interest and finance charges paid/payable on lease liabilities Total finance costs Consolidated 2019 $ 57,348 82,880 140,228 2020 $ 40,421 50,000 90,421 Consolidated 2020 $ 2019 $ 10,212 19,689 111,363 141,264 832,072 64,691 21,288 918,051 3,485 12,231 – 15,716 436,013 68,566 22,563 527,142 1,059,315 542,858 2,480 2,935 5,415 4,788 – 4,788 63 Notes to the financial statements continued Note 8. Income tax expense/(benefit) Numerical reconciliation of income tax expense/(benefit) and tax at the statutory rate Loss before income tax (expense)/benefit Tax at the statutory tax rate of 27.5% Non‑deductible expenses Research and development Unrecognised income tax benefit in respect of current year losses Amount not brought to account as deferred tax asset in the current year Amounts brought to account as deferred tax asset in the current year Other amounts not recognised relating to foreign tax rate differences Other – ATO Cashflow Boost Income tax expense/(benefit) Tax losses not recognised Unused tax losses for which no deferred tax asset has been recognised Potential tax benefit @ 27.5% Consolidated 2020 $ 2019 $ (6,892,991) (6,599,957) (1,895,573) (1,814,988) 597,715 – 698,531 (22,792) 1,339,877 1,200,116 (28,269) (60,868) (31,145) 48,865 (13,750) (23,435) (10,116) – 17,720 (33,552) 17,496,31 12,415,806 4,811,487 3,414,347 The above potential tax benefit for tax losses has not been recognised in the statement of financial position. These tax losses can only be utilised in the future if the continuity of ownership test is passed, or failing that, the same business test is passed, and the Company earns sufficient taxable profit to absorb the losses. Deferred tax assets not recognised Deferred tax assets not recognised comprises temporary differences attributable to: Employee entitlements Capital raising costs Other Tax losses Less deferred tax liability not recognised – prepayments Net deferred tax assets not recognised Consolidated 2020 $ 2019 $ 151,691 253,492 76,155 102,557 270,358 34,978 4,811,487 3,414,347 (5,413) (10,328) 5,287,412 3,811,912 The above potential tax benefit, which includes tax losses, for deductible temporary differences has not been recognised in the statement of financial position as the recovery of this benefit is uncertain. 64 Bid Annual Report 2020 Notes to the financial statements continued Note 9. Current assets – cash and cash equivalents Cash at bank Cash on deposit Note 10. Current assets – trade and other receivables Trade receivables Consolidated 2020 $ 2019 $ 4,295,916 3,298,978 4,000,000 900,000 8,295,916 4,198,978 Consolidated 2020 $ 2019 $ 470,050 287,745 Due to the short‑term nature of the receivables, their carrying value is assumed to approximate their fair value. No collateral or security is held. The consolidated entity has financial risk management policies in place to ensure that all receivable are received within the credit time frame. 11. Current assets – rights-of-use assets Buildings – right‑of‑use Less: Accumulated depreciation Reconciliations Consolidated 2019 $ – – – 2020 $ 144,776 (108,580) 36,196 Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below: Consolidated Balance at 1 July 2019 Initial recognition on adoption of AASB 16 Exchange differences Depreciation expense Balance at 30 June 2020 Right of use assets $ – 138,156 9,403 (111,363) 36,196 65 Notes to the financial statements continued Note 12. Current assets – Other current assets Prepayments Security deposits Other Note 13. Non-current assets – property, plant and equipment Computer equipment – at cost Less: Accumulated depreciation Office equipment – at cost Less: Accumulated depreciation Consolidated 2019 $ 46,178 – 616,793 662,971 Consolidated 2019 $ 25,043 (5,549) 19,494 106,540 2020 $ 74,544 90,550 108 165,202 2020 $ 39,603 (15,844) 23,759 125,914 (103,830) (85,520) 22,084 45,843 21,020 40,514 Reconciliations Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below: Office Equipment at cost $ Computer Equipment at cost $ 13,134 20,117 15,113 7,866 Total $ 28,247 27,983 (12,231) (3,485) (15,716) 21,020 18,856 (394) 1,435 (19,689) 21,228 19,494 14,125 – 1,208 40,514 32,981 (394) 2,643 (10,212) (29,901) 24,615 45,843 Consolidated Balance at 1 July 2018 Additions Depreciation expense Balance at 30 June 2019 Additions Disposals Foreign exchange differences Depreciation expense Balance at 30 June 2020 66 Bid Annual Report 2020 Notes to the financial statements continued Note 14. Non-current assets – intangibles Goodwill – at cost Customer list – at cost Less: Accumulated amortisation Software – at cost Less: Accumulated amortisation Brand – at cost Less: Accumulated amortisation Consolidated 2019 $ 693,472 156,479 2020 $ 706,918 159,513 (76,206) (53,895) 83,307 102,584 3,333,561 2,168,632 (1,912,236) (1,078,158) 1,421,325 1,090,474 484,780 475,559 (231,582) (163,780) 253,198 311,779 2,464,748 2,198,309 Reconciliations Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below: Consolidated Goodwill $ Software $ Brands $ Customer Lists $ Total $ Balance at 1 July 2018 657,767 903,043 355,859 117,090 2,033,759 Capitalised development costs R&D refund – – 1,019,496 (391,575) – – – – 1,019,496 (391,575) Foreign exchange differences 35,705 (4,477) 24,486 8,057 63,771 Amortisation – (436,013) (68,566) (22,563) (527,142) Balance at 30 June 2019 693,472 1,090,474 311,779 102,584 2,198,309 Capitalised development costs – 1,162,580 Foreign exchange differences 13,446 343 – 6,110 – 2,011 1,162,580 21,910 Amortisation – (832,072) (64,691) (21,288) (918,051) Balance at 30 June 2020 706,918 1,421,325 253,198 83,307 2,464,748 Impairment Testing of Intangible balances BidEnergy holds intangible balances relating to goodwill and other intangibles purchased as part of the US based energy rebate capture business purchased in November 2016, as well as intangible balances relating to developed software for the BidEnergy energy spend management business. The recoverable amount of these intangibles has been determined based on a value in use calculation using separate cash flow projections for the BidEnergy US and BidEnergy cash generating units (CGU’s) over a five‑year period respectively. Cash flow beyond the five year forecast are extrapolated using estimated terminal growth rates. 67 Notes to the financial statements continued Note 14. Non-current assets – intangibles (continued) Key assumptions used for value in use calculations BidEnergy US The following key assumptions were used in the discounted cashflow model for BidEnergy US goodwill and intangible asset assessment of $1,043,312: (a) 22.6% pre‑tax discount rate; (b) 66.4% per annum average projected revenue growth rate; (c) 44% per annum increase in operating costs and overheads; and (d) Terminal growth rate of 2% at the end of the forecast period. The discount rate of 22.6% pre‑tax reflects management’s estimate of the time value of money and the consolidated entity’s weighted average cost of capital adjusted for BidEnergy US, the risk‑free rate and the volatility of the share price relative to market movements. Management believes the projected 66.4% revenue growth rate is reasonable and justified, based on known contracts and market conditions. Results of impairment testing and sensitivity to changes in assumptions Based on the impairment testing of BidEnergy US goodwill and intangible assets for 2020, there was no requirement to impair intangibles as the recoverable amounts exceed the intangible carrying amounts. The Group has considered changes in key assumptions that it believes to be reasonably possible. For the BidEnergy US CGU, the recoverable amount exceeds the carrying amount when testing for reasonably possible changes in key assumptions and there is no reasonable possible change in a key assumption that would result in impairment. BidEnergy The following key assumptions were used in the discounted cashflow model for BidEnergy capitalised software assessment of $1,421,365: (a) 22.6% pre‑tax discount rate; (b) 54.1% per annum average projected revenue growth rate; (c) 18.3% per annum increase in operating costs and overheads; and (d) Terminal growth rate of 2% at the end of the forecast period. The discount rate of 22.6% pre‑tax reflects management’s estimate of the time value of money and the Consolidated Entity’s weighted average cost of capital adjusted for the BidEnergy software platform, the risk‑free rate and the volatility of the share price relative to market movements. Management believes the projected 54.1% revenue growth rate is reasonable and justified, based on known contracts and market conditions. Results of impairment testing and sensitivity to changes in assumptions Based on the impairment testing of BidEnergy capitalised software for 2020, there was no requirement to impair the intangible asset as the recoverable amounts exceed the intangible carrying amounts Management believes that other reasonable changes in the key assumptions on which the recoverable amount of BidEnergy’s capitalised software is based would not cause the CGU’s intangible carrying amount to exceed its recoverable amount. 68 Bid Annual Report 2020 Notes to the financial statements continued Note 15. Non-current assets – other Security deposits Note 16. Current liabilities – trade and other payables Trade payables Accrued expenses Other payables Refer to note 24 for further information on financial instruments. Note 17. Current liabilities – borrowings Promissory note Refer to note 24 for further information on financial instruments. Consolidated 2020 $ 2019 $ 30,482 70,008 Consolidated 2019 $ 260,905 166,385 320,800 748,090 2020 $ 397,362 337,867 394,050 1,129,279 Consolidated 2019 $ – 2020 $ 101,735 On 21 May 2020, BidEnergy Inc entered into the Paycheck Protection Program and took out USD$242,030 (AUD$351,291) in promissory note with TD Bank, N.A. The promissory note has a fixed interest rate of 1% and matures 2 years from the date of issue. BidEnergy Inc must pay monthly principal and interest payments on the outstanding principal balance of the loan amortised over the term of the loan, unless otherwise forgiven in whole or part in accordance with the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). Pursuant to the terms of the CARES Act and any implementing rules and regulations, BidEnergy Inc will apply for the loan to be forgiven by the Small Business Administration (“SBA”, an Agency of the United States of America) in whole or in part beginning no sooner than seven (7) weeks from the date of the Note. Any loan balance remaining following forgiveness by the SBA will be fully reamortized over the remaining term of the loan. BidEnergy Inc is meeting its obligations under the act, and intends to apply for forgiveness in the 1st quarter of FY21. 69 Notes to the financial statements continued Note 18. Current liabilities – Employee benefits Annual leave Note 19. Current liabilities – other Tax liabilities Deferred revenue Note 20. Non-current liabilities – borrowings Promissory note Refer to note 24 for further information on financial instruments. Note 21. Non-current liabilities – Employee benefits Long service leave Consolidated 2020 $ 2019 $ 526,665 317,362 Consolidated 2019 $ – 182,162 182,162 2020 $ 48,908 313,467 362,375 Consolidated 2019 $ – 2020 $ 249,556 Consolidated 2020 $ 2019 $ 136,449 92,793 70 Bid Annual Report 2020 Notes to the financial statements continued Note 22. Equity – issued capital Ordinary shares – fully paid 130,717,455 113,770,785 37,006,753 25,797,430 2020 Shares 2019 Shares 2020 $ 2019 $ Consolidated Movements in ordinary share capital Details Balance as at 1 July 2018 Share consolidation Exercise of options Issue of Earn Out Shares to RWW Vendors Issue of Shares pursuant to BIDO option underwriting Costs of capital raising Balance as at 30 June 2019 Ordinary shares $ 740,677,364 22,360,257 (631,753,532) – 3,683,371 2,692,856 112,566 1,051,016 133,684 714,691 – (104,058) 113,770,785 25,797,430 Issue of shares on conversion of Class E performance rights 2,250,198 1,759,647 Issue of shares to employees as an equity‑based component of their remuneration 257,354 153,126 Issue of Placement shares Issue of shares under Share Purchase Plan Offer Exercise of options Issue of shares on conversion of Class A restricted share units Cost of capital raising Balance as at 30 June 2020 Ordinary shares 8,750,001 5,075,001 2,764,665 1,603,506 1,851,452 1,310,845 1,073,000 1,695,340 – (388,142) 130,717,455 37,006,753 Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Company does not have a limited amount of authorised capital. On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. 71 Notes to the financial statements continued Note 22. Equity – issued capital Capital risk management The Consolidated Entity’s objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost of capital. Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated as total borrowings less cash and cash equivalents. In order to maintain or adjust the capital structure, the Consolidated Entity may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Consolidated Entity would look to raise capital when an opportunity to invest in a business or company was seen as value adding relative to the current Company’s share price at the time of the investment. The capital risk management policy remains unchanged from the 2019 Annual Report. Note 23. Equity – reserves Foreign currency reserve Options reserve Movements in reserves Consolidated 2020 2020 $ 2019 $ (39,832) (59,590) 1,922,467 3,773,740 1,882,635 3,714,150 Movements in each class of reserve during the current and previous financial year are set out below: Consolidated Balance at 1 July 2018 Foreign currency translation Foreign currency reserve $ Options reserve $ Total $ (129,142) 1,233,626 1,104,484 69,552 – 69,552 Share based payments for employees and directors – 2,540,114 2,540,114 Balance at 30 June 2019 Foreign currency translation Share based payments Transfer to retained earnings Conversion of performance rights Conversion of restricted share units Balance at 30 June 2020 72 Bid Annual Report 2020 (59,590) 3,773,740 3,714,150 19,758 – 19,758 – – – – 2,013,836 2,013,836 (410,122) (410,122) (1,759,647) (1,759,647) (1,695,340) (1,695,340) (39,832) 1,922,467 1,882,635 Notes to the financial statements continued Note 24. Financial instruments Financial risk management objectives The Consolidated Entity’s activities expose it to a variety of financial risks: market risk (including foreign currency risk, price risk and interest rate risk), credit risk and liquidity risk. The Consolidated Entity’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Consolidated Entity. The Consolidated Entity uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis in the case of interest rate, foreign exchange and other price risks, ageing analysis for credit risk and beta analysis in respect of investment portfolios to determine market risk. Derivatives are not currently used by the Consolidated Entity for hedging purposes. The Consolidated Entity does not speculate in the trading of derivative instruments. Market risk Foreign currency risk The Consolidated Entity undertakes certain transactions denominated in foreign currency and is exposed to foreign currency risk through foreign exchange rate fluctuations, in particular United States dollars. Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities denominated in a currency that is not the entity’s functional currency. The risk is measured using sensitivity analysis and cash flow forecasting. The carrying amount of the Consolidated Entity’s foreign currency denominated financial assets and financial liabilities at the reporting date were as follows (holdings are shown in AUD equivalent): Consolidated US dollars GBP 2020 $ Assets 2019 $ 2020 $ 2,177,516 482,962 (902,577) 166,697 26,019 (847,681) Liabilities 2019 $ (97,111) (21,613) 2,344,213 508,981 (1,750,258) (118,724) 73 Notes to the financial statements continued Note 24. Financial instruments (continued) Market risk (continued) Foreign currency risk (continued) The following tables below illustrate the sensitivity of the net result for the year and equity in regard to the Group’s financial assets and financial liabilities compared with the currency on deposit and AUD exchange rate. It assumes a +/– 5% change in the exchange rate for the year ended at 30 June 2020. This percentage has been determined based on average market volatility in exchange rates in the previous 12 months. The sensitivity analysis is based on the Group’s foreign currency financial instruments held at each reporting date. This assumes that other variables, in particular interest rates, remain constant. Consolidated – 2020 US dollars GBP Consolidated – 2019 US dollars GBP AUD strengthened AUD weakened % change 5% 5% Effect on profit before tax (63,747) 3,405 Effect on equity % change 63,747 (3,405) 5% 5% (60,342) 60,342 Effect on profit before tax 63,747 (3,405) 60,342 Effect on equity (63,747) 3,405 (60,342) AUD strengthened AUD weakened % change 5% 5% Effect on profit before tax (19,293) (220) (19,513) Effect on equity % change 19,293 220 19,513 5% 5% Effect on profit before tax 19,293 220 19,513 Effect on equity (19,293) (220) (19,513) Price risk The Consolidated Entity is not exposed to any significant price risk. Interest rate risk The Consolidated Entity is not exposed to any significant interest rate risk. Credit risk Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Consolidated Entity. The Consolidated Entity has a strict code of credit, including obtaining agency credit information, confirming references and setting appropriate credit limits. The Consolidated Entity obtains guarantees where appropriate to mitigate credit risk. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the financial statements. The Consolidated Entity does not hold any collateral. The Consolidated Entity has adopted a lifetime expected loss allowance in estimating expected credit losses to trade receivables through the use of a provisions matrix using fixed rates of credit loss provisioning. These provisions are considered representative across all customers of the Consolidated Entity based on recent sales experience, historical collection rates and forward‑looking information that is available. The Consolidated Entity does not have any material credit risk exposure to any single receivable or group of receivables under financial instruments entered into by the economic entity. Generally, trade receivables are written off when there is no reasonable expectation of recovery. Indicators of this include the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make contractual payments for a period greater than 1 year. 74 Bid Annual Report 2020 Notes to the financial statements continued Liquidity risk Liquidity risk arises from the possibility that the Consolidated Entity might encounter difficulty in settling its debts or otherwise meeting its obligations related to financial liabilities. The Consolidated Entity manages this risk by preparing forward looking cash flow analysis in relation to its operational, investing and financing activities and monitoring its cash assets and assets readily convertible to cash in the context of its forecast future cash flows. The Consolidated Entity manages liquidity risk by maintaining adequate cash reserves by continuously monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities. Remaining contractual maturities The following tables detail the Consolidated Entity’s remaining contractual maturity for its financial instrument liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining contractual maturities and therefore these totals may differ from their carrying amount in the statement of financial position. Weighted average interest rate % 1 year or less $ Between 1 and 2 years $ Between 2 and 5 years $ Over 5 years $ Remaining contractual maturities $ Consolidated – 2020 Non-derivatives Non-interest bearing Trade and other payables – 1,129,279 – Interest-bearing – fixed rate Promissory note Lease liability 1.00% 4.32% 101,735 249,556 38,186 – Total non‑derivatives 1,269,200 249,556 – – – – – – – – 1,129,279 351,291 38,186 1,518,756 Consolidated – 2019 Non–derivatives Non–interest bearing Trade and other payables Total non–derivatives Weighted average interest rate % 1 year or less $ Between 1 and 2 years $ Between 2 and 5 years $ Over 5 years $ Remaining contractual maturities $ – – 748,090 748,090 – – – – – – 748,090 748,090 The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed above. Fair value of financial instruments Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value. 75 Notes to the financial statements continued Note 25. Key management personnel disclosures Directors The following persons were Directors of BidEnergy Limited during the financial year: Mr Geoffrey Kleemann Interim Chairman (appointed as Non‑Executive Director 1 September 2019, becoming Interim Chairman on 10 June 2020) Mr Guy Maine Managing Director Ms Leanne Graham Non‑Executive Director Mr Andrew Dyer Non‑Executive Chairman (retired from the Board on 30 June 2020) Other key management personnel The following persons also had the authority and responsibility for planning, directing and controlling the major activities of the Consolidated Entity, directly or indirectly, during the financial year: Mr Matthew Watson Chief Financial Officer (resigned on 28 July 2020) Compensation The aggregate compensation made to Directors and other members of key management personnel of the Consolidated Entity is set out below: Short‑term benefits Long‑term benefits Post‑employment benefits Share‑based payments Consolidated 2020 $ 2019 $ 953,077 1,027,018 9,976 84,511 429,115 90,776 15,757 1,476,679 1,433,551 Note 26. Remuneration of auditors During the financial year the following fees were paid or payable for services provided by RSM Australia Partners, the auditor of the Consolidated Entity: Audit services – RSM Australia Partners Audit or review of the financial statements Other services – RSM network firms Advisory services Tax and compliance 76 Bid Annual Report 2020 Consolidated 2020 $ 2019 $ 82,500 76,660 – – – 82,500 1,500 17,611 19,111 95,771 Notes to the financial statements continued Note 27. Contingent assets and liabilities The Directors are not aware of any contingent assets or contingent liabilities as at 30 June 2020 (2019: Nil). Note 28. Commitments Consolidated 2020 $ 2019 $ – – – 215,669 35,361 251,030 Lease commitments – operating Committed at the reporting date but not recognised as liabilities, payable: Within one year One to five years The company has no capital expenditure commitments as at 30 June 2020 (2019: Nil). Note 29. Related party transactions Parent entity BidEnergy Limited is the parent entity. Subsidiaries Interests in subsidiaries are set out in note 31. Key management personnel Disclosures relating to key management personnel are set out in note 25 and the remuneration report included in the Directors’ report. Transactions with related parties The following transactions occurred with related parties: Payment for other expenses: Consulting fees paid to director related entity (Andrew Dyer – through Collins Street Management) for provision of support services Consolidated 2020 $ 2019 $ – 6,251 Receivable from and Payable to related parties There were no trade receivables from or trade payables to related parties at the current and previous reporting date. Loans to/from related parties There were no loans to or from related parties at the current and previous reporting date. Terms and conditions All transactions were made on normal commercial terms and conditions and at market rates. 77 Notes to the financial statements continued Note 30. Parent entity information Set out below is the supplementary information about the parent entity. Statement of profit or loss and other comprehensive income Loss after income tax Total comprehensive income Statement of financial position Total current assets Total assets Total current liabilities Total liabilities Equity Issued capital Options reserve Accumulated losses Total equity 2020 $ Parent 2019 $ (3,131,830) (3,298,114) (3,131,830) (3,298,114) 2020 $ Parent 2019 $ 5,759,127 3,896,977 22,344,330 15,615,327 364,713 364,713 271,862 271,862 29,537,657 18,328,523 1,644,940 3,496,213 (9,202,980) (6,481,271) 21,979,617 15,343,465 Guarantees entered into by the parent entity in relation to the debts of its subsidiaries The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2020. Contingent liabilities The parent entity had no contingent liabilities as at 30 June 2019 and 30 June 2020. Capital commitments – Property, plant and equipment The parent entity had no capital commitments for property, plant and equipment as at 2019 and 2020. Significant accounting policies The accounting policies of the parent entity are consistent with those of the Consolidated Entity, as disclosed in note 2, except for the following: • Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity; and • Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt may be an indicator of an impairment of the investment. 78 Bid Annual Report 2020 Notes to the financial statements continued Note 31. Interests in subsidiaries The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in note 2: Name Principal place of business/ Country of incorporation BidEnergy (Operations) Pty Ltd Australia BidEnergy Limited BidEnergy Inc United Kingdom United States Ownership interest 2020 % 100% 100% 100% 2019 % 100% 100% 100% Note 32. Events after the reporting period On 13 July 2020, the Company issued 174,424 Class M Performance Rights under its Employee Incentive Plan. The above securities were issued to certain employees of the Company who have elected to participate in a program to help preserve the Company’s cash during the COVID‑19 impact period. The Performance Rights will vest on 13 October 2020, subject to the holder remaining employed by the Company on vesting date. On 17 July 2020, the Company issued 110,000 fully paid ordinary shares on conversion of Class F performance rights. On 29 June 2020, the Chief Financial Officer tendered his resignation, effective 28 July 2020. The impact of Coronavirus (COVID‑19) pandemic is ongoing and while there have been mixed financial and operational impacts for the Consolidated Entity up to 30 June 2020, it is not practical to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided. On 12 August 2020, the Company issued 105,887 fully paid ordinary shares on conversion of Class J performance rights. On 17 August 2020, the Company issued 1,950,000 Class Q Options with an exercise price of $1.26 per option, expiring 17 August 2024. On 21 August 2020, the Company issued 134,485 fully paid ordinary shares at an issue price of $0.75 (75 cents) per share pursuant to the exercise of Class L Options, raising $100,863. No other matter or circumstance has arisen since 30 June 2020 that has significantly affected, or may significantly affect the Consolidated Entity’s operations, the results of those operations, or the Consolidated Entity’s state of affairs in future financial years. 79 Notes to the financial statements continued Note 33. Reconciliation of loss after income tax to net cash used in operating activities Loss after income tax (expense)/benefit for the year Adjustments for: Depreciation and amortisation Foreign exchange differences Share based payments Consolidated 2020 $ 2019 $ (6,910,711) (6,566,405) 1,059,315 542,858 25,335 4,754 2,166,962 2,540,114 Change in operating assets and liabilities: Increase in trade and other receivables (182,305) (99,881) Increase in other assets Increase in trade and other payable Decrease in deferred tax liabilities Increase/(decrease) in other liabilities Increase in provisions Net cash used in operating activities Note 34. Earnings per share (118,863) 381,189 (31,145) 268,867 252,959 (5,199) 370,021 (23,435) (40,034) 162,117 (3,088,397) (3,115,090) Consolidated 2020 $ 2019 $ Loss after income tax attributable to the owners of BidEnergy Limited (6,910,711) (6,566,405) Weighted average number of ordinary shares used in calculating basic earnings per share 125,211,261 109,517,914 Weighted average number of ordinary shares used in calculating diluted earnings per share 125,211,261 109,517,914 Number Number Basic earnings per share Diluted earnings per share Cents (5.52) (5.52) Cents (6.00) (6.00) As at 30 June 2020, the Consolidated Entity has 17,709,560 options, 1,923,541 performance rights and 505,302 restrictive share units on issue. These equity instruments are considered to be anti‑dilutive, as the consolidated entity generated loss after income tax. 80 Bid Annual Report 2020 Notes to the financial statements continued Note 35. Share-based payments Shares issued to employees On 11 September 2019, the Consolidated Entity issued 257,354 fully paid ordinary shares to certain employees as an equity‑based component of their remuneration. $153,126 share‑based payment expense was recorded in relation to these shares. Directors and other key management personnel options As part of KMP remuneration, the Consolidated Entity offers ownership‑based remuneration in the form of share option plans. The options are issued for nil consideration and are granted in accordance with guidelines established by the Board. Details of share based KMP remuneration is also included in the remuneration report. $470,248 of share‑based payment expense was recorded in relation to KMP options for the financial year 30 June 2020 (2019: $225,964). Set out below are summaries of options on issue to KMPs at financial year end: Grant date Expiry date 30/11/16 17/01/18 27/11/18 03/12/19 03/12/19 28/07/20 16/01/22 26/11/22 29/01/23 14/10/23 10/02/20 07/02/24 Granted* Exercised Exercise price Balance at the start of the year $0.680 73,530 $0.136 2,205,883 588,236 $1.190 $1.930 $0.850 $1.700 – – – 1,000,000 971,638 471,938 2,867,649 2,443,576 – – – 2020 Expired/ forfeited/ other Balance at the end of the year – – 73,530 2,205,883 (147,059) 441,177 (700,000) 300,000 (97,164) 874,474 (267,432) 204,506 (1,211,655) 4,099,570 $1.703 $0.621 – – – – – – – – Weighted average exercise price $0.366 $1.456 * On the 3 December 2019, the Consolidated Entity issued: • • • 1,000,000 Class M Options to the Managing Director of the Company, of which 700,000 was forfeited on 13 March 2020 as the vesting conditions were not met. The plan was valued at $189,000, using Binomial Valuation method. As at 30 June 2020, $37,311 has been recognised as share‑based payments. 277,611 Class N Options to the Managing Director of the Company. The plan was valued at $76,787, using Binomial Valuation method. As at 30 June 2020, $38,880 has been recognised as share‑based payments. 694,027 Class N Options to the Non‑Executive Directors of the Company. The plan was valued at $187,943 using Binomial method. As at 30 June 2020, the full value has been recognised as share‑based payments. 81 Notes to the financial statements continued Note 35. Share-based payments (continued) Directors and other key management personnel options (continued) On 10 February 2020, the Consolidated Entity issued 471,938 Class P Options to the CTO and CFO of the Company. The plan was valued at $340,739, using Binomial valuation method. As at 30 June 2020, $90,089 has been recognised as share‑ based payments. Grant date Expiry date 30/11/16 17/01/18 27/11/18 28/07/20 16/01/22 26/11/22 Exercise price Balance at the start of the year $0.680 500,000 $0.136 15,000,000 Granted* – – Share consoli- dation* (426,470) (12,794,117) Forfeited*** – – 2019 Balance at the end of the year 73,530 2,205,883 $1.190 – 8,000,000 (6,823,528) (588,236) 588,236 15,500,000 8,000,000 (20,044,115) (588,236) 2,867,649 Weighted average exercise price $0.154 $1.190 $0.506 $1.190 $0.366 * On 27 November 2018, the Consolidated Entity issued 8,000,000 class K options to Directors. The plan was valued at $558,919, using Binomial Valuation method. As at 30 June 2019, $166,297 had been recognised as share‑based payments. ** Following shareholder approval, the company consolidated its issued capital on 100 for 680 shares basis. *** Mr James Baillieu resigned as Non‑Executive Director on 22 February 2019. Mr Anthony Du Preez resigned as Executive Director on 13 February 2019, continuing as CTO. As a result of both Board resignations, 588,236 Class K options (post share consolidation) were forfeited. Set out below are the options exercisable at the end of the financial year: Grant date Expiry date 30/11/16 17/01/18 27/11/18 03/12/19 03/12/19 28/07/20 16/01/22 26/11/22 29/01/23 14/10/23 10/02/20 07/02/24 2020 Number 2019 Number 73,530 73,530 1,838,236 955,883 220,588 103,125 694,027 102,253 – – – – 3,031,759 1,029,413 Valuation of options granted during FY20 For the options granted during the current financial year, the valuation model inputs used to determine the fair value at the grant date, are as follows: Grant date Expiry date 03/12/19 03/12/19 29/01/23 14/10/23 10/02/20 07/02/24 Share price at grant date Exercise price Expected volatility Risk-free interest rate Fair value at grant date $0.580 $0.580 $1.235 $1.930 $0.850 $1.700 89.00% 89.00% 91.00% 0.62% 0.62% 0.70% $0.189 $0.319 $0.722 82 Bid Annual Report 2020 Notes to the financial statements continued Employee performance rights plan The Consolidated Entity provides ownership‑based remuneration schemes to executive directors, nominated employees and key management personnel. For the year ended 30 June 2020, $394,022 has been recognised as a share based payment expense in relation to performance rights of employees (2019: $1,698,836). Set out below are those performance rights outstanding at the end of the financial year. Class Class A Class E Class F Class G Class H Class I Class J Class K Class L Grant date Expiry date Exercise price Balance at the start of the year Granted Exercised 01/07/16 01/07/20 $0.85 328,401 20/07/18 20/10/19 27/05/19 05/11/20 25/03/20 25/06/21 08/04/20 07/04/23 08/04/20 07/04/23 12/05/20 12/05/21 12/06/20 12/06/21 12/06/20 12/06/21 – – – – – – – – 2,250,198 110,000 – – – – – – – – – 161,606 873,077 140,950 105,887 148,969 54,651 – (2,250,198) – – – – – – – 2020 Expired/ forfeited/ other Balance at the end of the year – – – – 328,401 – 110,000 161,606 (305,576) 567,501 (49,333) 91,617 – – – 105,887 148,969 54,651 Weighted average exercise price $0.850 – – – $0.850 2,688,599 1,485,140 (2,250,198) (354,909) 1,568,632 Class Class A Class E 20/07/18 20/10/19 Class F** 27/05/19 05/11/20 Grant date Expiry date Exercise price* Balance at the start of the year Share Consolid- ation* Expired/ forfeited/ other Balance at the end of the year Granted 2019 01/07/16 01/07/20 $0.85 2,233,084 – (1,904,683) – – – – 15,301,277 (13,051,079) 110,000 – 2,233,084 15,411,277 (14,955,762) – – – – – 328,401 2,250,198 110,000 2,688,599 $0.850 Weighted average exercise price $0.850 – 0.850 * Share consolidation adjustment on a 100 to 680 basis. ** Unlisted Class F performance rights were issued to Mr Darren Knihnicki (CCO) on 5 August 2019. Under IG4, which is set out in the Appendix to AASB 2 Share Based Payments, the service commencement date of these performance rights was deemed to be 27 May 2019. Set out below are the performance rights exercisable at the end of the financial year: Class Class A Class F Grant date Expiry date 01/07/16 01/07/20 27/05/19 05/11/20 2020 Number 285,970 110,000 395,970 2019 Number 232,405 – 232,405 83 Notes to the financial statements continued Note 35. Share-based payments (continued) Valuation of performance rights granted during FY20 For the performance rights granted during the current financial year, the valuation model inputs used to determine the fair value at the grant date, are as follows: Class Class G Class H Class I Class J Class K Class L Grant date Expiry date 25/03/20 25/06/21 08/04/20 07/04/23 08/04/20 07/04/23 12/05/20 12/06/20 12/06/20 12/05/21 12/06/21 12/06/21 Restricted Share Units Share price at grant date Exercise price Fair value at grant date $0.490 $0.750 $0.750 $0.785 $0.650 $0.650 – – – – – – $0.490 $0.750 $0.750 $0.785 $0.650 $0.650 In 2019 financial year, the Consolidated Entity issued 1,073,000 Class A Unlisted Restricted Share Units (“RSUs”) under the Company’s 2019 Restricted Share Units Plan to US Employees of the Company. They were vested and converted into 1,073,000 Fully Paid Ordinary Share on 12 March 2020. $1,080,026 of share based payment expense was recorded in relation to Class A RSUs for the financial year 30 June 2020 (2019: $615,314). On 8 April 2020, the Consolidated Entity issued 436,677 Class B Unlisted RSUs under the Company’s 2020 Restricted Share Units Plan to US employees. Each RSU will automatically vest upon the satisfaction of both performance conditions and Retention conditions. The plan was valued at $327,508. As at 30 June 2020, $60,328 has been recognised as share‑based payments. On 12 June 2020, the Consolidated Entity issued 68,625 Class C Unlisted RSUs under the Company’s Employee Incentive Plan. Each RSU will automatically vest upon the satisfaction of retention condition. The plan was valued at $44,606. As at 30 June 2020, $9,212 has been recognised as share‑based payments. Reconciliation of share based payments expense recorded in the statement of profit and loss relating to each class of share‑based payment: Performance rights payment Restrictive Share Units issued to BidEnergy Inc. employees Options payment to Directors and other key management personnel Issue of shares to employees Total share‑based payments expense Note 36. Funds held in trust Consolidated 2020 $ 2019 $ 394,022 1,698,836 1,149,566 470,248 153,126 615,314 225,964 – 2,166,962 2,540,114 The Company holds funds and pays utility bills on behalf of its clients. As at 30 June 2020 the amount held on trust was $47,280 (2019: $1,179,974). 84 Bid Annual Report 2020 Directors’ declaration 30 June 2020 In the Directors’ opinion: • • • • the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; the attached financial statements and notes comply with International Financial Reporting Standards as issued by the International Accounting Standards Board as described in note 2 to the financial statements; the attached financial statements and notes give a true and fair view of the Consolidated Entity’s financial position as at 30 June 2020 and of its performance for the financial year ended on that date; and there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable. The Directors have been given the declarations required by section 295A of the Corporations Act 2001. Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations Act 2001. On behalf of the Directors Geoffrey Kleemann Interim Chairman 26 August 2020 85 Independent auditor’s report RSM Australia Partners Level 21, 55 Collins Street Melbourne VIC 3000 PO Box 248 Collins Street West VIC 8007 T +61 (0) 3 9286 8000 F +61 (0) 3 9286 8199 www.rsm.com.au INDEPENDENT AUDITOR’S REPORT To the Members of BidEnergy Limited Opinion We have audited the financial report of BidEnergy Limited (the Company) and its controlled entities (the Consolidated Entity), which comprises the consolidated statement of financial position as at 30 June 2020, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and the directors' declaration. In our opinion, the accompanying financial report of the Consolidated Entity is in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the Consolidated Entity's financial position as at 30 June 2020 and of its financial performance for the year then ended; and (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for Opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Consolidated Entity 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. THE POWER OF BEING UNDERSTOOD AUDIT | TAX | CONSULTING 60 RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction. RSM Australia Partners ABN 36 965 185 036 Liability limited by a scheme approved under Professional Standards Legislation 86 Bid Annual Report 2020 Independent auditor’s report continued Key Audit Matters (continued.) Key Audit Matter How our audit addressed this matter Revenue Recognition Refer to Note 5 in the financial statements Revenue recognition was considered a key audit matter because it is the most significant account balance in the consolidated statement of profit or loss and other comprehensive income. The Consolidated Entity receives revenue from two core income streams, and the accounting for each of these differs. Capitalisation of Software Development Costs Refer to Note 14 in the financial statements the year ended 30 June 2020, During Consolidated Entity’s development costs of $1,162,580. capitalised the software recognition of the capitalised software The development costs involves significant judgement in respect of factors including, probability of future economic benefits and accuracy of inputs such as wage rate and overhead calculations. We identified this as a key audit matter due to the judgement in capitalising software development costs, in particular when capitalising wages and overheads. involved Our audit procedures in relation to the recognition of revenue included: Assessing whether the Consolidated Entity’s revenue recognition policies were in compliance with AASB 15 Revenue from Contracts with Customers; Evaluating the operating management’s recognition; controls effectiveness to of revenue related Performing substantive analytical review procedures on US energy rebate revenue; Performing detailed testing on a sample of platform subscription fees recognised and assessing the allocation of revenue to the contracts with customers; and Reviewing revenue transactions before and after year-end to ensure that revenue is recognised in the correct period. Our audit procedures in relation to capitalised software development costs included: Assessing management’s capitalisation policy against the requirements of AASB 138 Intangible Assets; Challenging management’s basis for capitalisation and judgements on expected future economic benefit for a sample of projects; Assessing the costs capitalised on a sample basis to the definition of they meet determine whether development activity in accordance with AASB 138 and are correctly treated; Reviewing a sample of software costs which were expensed in the year to identify if these were eligible for capitalisation in accordance with AASB 138; and Reviewing wage rates utilised in capitalisation calculations. 61 87 Independent auditor’s report continued Key Audit Matters (continued.) Key Audit Matter How our audit addressed this matter two CGU’s based on Our audit procedures in relation to management’s impairment assessment included: Assessing management’s determination that the goodwill and intangible assets should be allocated to the Consolidated Entity’s business and the manner in which results are monitored and reported; Assessing the valuation methodology used; Challenging of key assumptions, including the cash flow projections, exchange rates, discount rates, and sensitivities used; reasonableness the nature of the Checking the mathematical accuracy of the cash flow model, and reconciling input data to supporting evidence, such as approved budgets and considering the reasonableness of these budgets; and Reviewing the accuracy of disclosures of critical financial valuation estimates and assumptions statements in methodologies. relation the the to in Impairment of goodwill and intangible assets Refer to Note 14 in the financial statements The Consolidated Entity has net book value goodwill in respect of the acquisitions of of $706,918 subsidiaries and $1,757,830 of other intangible assets as at 30 June 2020. We identified this area as a Key Audit Matter due to the size of the balance, and because the directors’ assessment of the ‘value in use’ of the cash generating unit’s involves significant (“CGU’s”) judgements about the future underlying cash flows of the business, discount rates and terminal growth applied. For the year ended 30 June 2020 management performed an impairment assessment of the goodwill and intangible assets balance by: Calculating the value in use for the CGU’s using a discounted cash flow model. The model used cash flows (revenues, expenses and capital expenditure) for the CGU’s for 5 years, with a terminal growth rate applied to the 5th year. The cash flows were then discounted to net present value using the Company’s weighted average cost of capital (WACC); and Comparing the resulting value in use of the CGU to its respective book value. Management also performed a sensitivity analysis of the value in use calculations, by varying the WACC and other assumptions used, to assess the impact on the valuation. 62 88 Bid Annual Report 2020 Independent auditor’s report continued Key Audit Matters (continued.) Key Audit Matter How our audit addressed this matter Valuation of performance rights, options and restricted shares units Refer to Note 35 in the financial statements The Consolidated Entity offers ownership based remuneration in the form of share option plans to Directors and other key management personnel. Management have accounted for these remuneration arrangements in accordance with AASB 2 Share- Based Payments. We consider this to be a key audit matter because of the complexity in the valuation of the instruments and the judgmental nature of inputs into the valuation models, including the likelihood of vesting conditions being met, and valuation methodology to apply. the appropriate Our audit procedures in relation to valuation of performance rights, options and restricted share units included: Assessing the valuation methodology used; Reviewing the inputs used by management in the valuation model to ensure they are appropriate; Assessing the valuation of performance rights, options and restricted shares units against the requirements of AASB 2; and Reviewing the reasonableness of management’s estimates of the likelihood of achieving the vesting is conditions appropriate. their assessment to ensure Other Information The directors are responsible for the other information. The other information comprises the information included in the Consolidated Entity's annual report for the year ended 30 June 2020, but does not include the financial report and the auditor's report thereon. Our opinion on the financial report does not cover the other information and 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 Consolidated Entity 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 Consolidated Entity or to cease operations, or have no realistic alternative but to do so. 63 89 Independent auditor’s report continued Auditor's Responsibilities for the Audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website at: www.auasb.gov.au/auditors_responsibilities/ar2.pdf. This description forms part of our auditor's report. Report on the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in the directors' report for the year ended 30 June 2020. In our opinion, the Remuneration Report of BidEnergy Limited, for the year ended 30 June 2020, 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. RSM AUSTRALIA PARTNERS B Y CHAN Partner Dated: 26 August 2020 Melbourne, Victoria 64 90 Bid Annual Report 2020 Shareholder information 30 June 2020 The shareholder information set out below was applicable as at 1 August 2020. 1. Quotation Listed securities in BidEnergy Limited are quoted on the Australian Securities Exchange under ASX code BID (Fully Paid Ordinary Shares). 2. Voting Rights The voting rights attached to the Fully Paid Ordinary shares of the Company are: (a) at a meeting of members or classes of members each member entitled to vote may vote in person or by proxy or by attorney; and (b) on a show of hands every person present who is a member has one vote, and on a poll every person present in person or by proxy or attorney has one vote for each ordinary share held. There are no voting rights attached to any Options, Performance Rights or Restricted Stock Units on issue. 3. Distribution of Shareholders i) Fully Paid Ordinary Shares Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Holders Units 597 640 362 612 154 287,302 1,707,974 2,836,965 20,340,576 105,654,638 % 0.22 1.31 2.17 15.55 80.75 2,365 130,827,455 100.00% On 1 August 2020, there were 375 holders of unmarketable parcels of less than 95,596 ordinary shares (based on the closing share price of $0.72). ii) Class G Performance Rights Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Holders Units – – – – % – – – – 161,6061 100.00 161,606 100.00% – – – – 1 1 1 Holders who hold more than 20% of securities are: Marco Miranda Nominees Pty Ltd– 161,606 performance rights. 91 Shareholder information continued iii) Class H Performance Rights Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total iv) Class I Performance Rights Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Holders Units – – 9,384 863,693 – – – – % – – 1.07 98.93 – % – – – 140,950 100.00 – – 140,9501 100.00% – – 1 30 – 31 – – – 4 – 4 Holders Units 1 Securities were issued under an Employee Share Scheme, therefore disclosure of holders with more than 20% of securities is not required under ASX Listing Rule 4.10.16. 873,0771 100.00% 1 Securities were issued under an Employee Share Scheme, therefore disclosure of holders with more than 20% of securities is not required under ASX Listing Rule 4.10.16. v) Class J Performance Rights Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Holders – 16 5 1 – Units – 54,699 34,178 17,010 – % – 51.66 32.28 16.06 – 22 105,8871 100.00% 1 Securities were issued under an Employee Share Scheme, therefore disclosure of holders with more than 20% of securities is not required under ASX Listing Rule 4.10.16. 92 Bid Annual Report 2020 Shareholder information continued vi) Class K Performance Rights Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Holders – 15 5 2 – Units – 50,069 30,662 68,238 – % – 33.61 20.58 45.81 – 22 148,9691 100.00% 1 Securities were issued under an Employee Share Scheme, therefore disclosure of holders with more than 20% of securities is not required under ASX Listing Rule 4.10.16. vii) Class L Performance Rights Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Holders Units – – 7,437 47,214 – – – 1 2 – 3 % – – 13.61 86.39 – 54,651 1 100.00% 1 Securities were issued under an Employee Share Scheme, therefore disclosure of holders with more than 20% of securities is not required under ASX Listing Rule 4.10.16. viii) Class M Performance Rights Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Holders – 14 6 2 – Units – 51,627 41,510 81,287 – % – 29.60 23.80 46.60 – 22 174,4241 100.00% 1 Securities were issued under an Employee Share Scheme, therefore disclosure of holders with more than 20% of securities is not required under ASX Listing Rule 4.10.16. 93 Shareholder information continued ix) Class E Options exercisable at $0.476 on or before 24 November 2021 1 Holders who hold more than 20% of securities are: Mr Douglas A Bloom – 189,159 options; Mr Leigh C Wood – 94,578 options. x) Class G Options exercisable at $0.204 on or before 31 December 2020 Holders Units 1 Holders who hold more than 20% of securities are: CG Nominees (Australia) Pty Ltd – 882,353 options. xi) Class H Options exercisable at $0.306 on or before 31 December 2020 Holders Units 1 Holders who hold more than 20% of securities are: CG Nominees (Australia) Pty Ltd – 882,353 options. xii) Class I Options exercisable at $0.408 on or before 31 December 2020 Holders Units Holders Units – – – 94,5781 189,1591 % – – – 33.33 66.67 283,737 100.00% – – – 1 1 2 – – – – 1 1 – – – – 1 1 – – – – 1 1 % – – – – % – – – – % – – – – – – – – – – – – – – – – 882,3531 100.00 882,353 100.00% 882,3531 100.00 882,353 100.00% 1,250,0001 100.00 1, 250,000 100.00% Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total 1 Holders who hold more than 20% of securities are: CG Nominees (Australia) Pty Ltd – 1,250,000 options. 94 Bid Annual Report 2020 Shareholder information continued xiii) Class J Options exercisable at $0.136 on or before 16 January 2022 1 Holders who hold more than 20% of securities are: 3XC Pty Ltd – 2,205,883 options. xiv) Class K Options exercisable at $1.19 on or before 26 November 2022 Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Holders Units 2, 205,8831 100.00 Holders Units 441,1771 100.00 441,177 100.00% – – – – – – – – – – – – % – – – – % – – – – % – – – – – – – – 1 – – – – 2 2 – – – – 1 1 1 Holders who hold more than 20% of securities are: L Graham Trustees Limited + Erca Trustees (LG) Limited – 294,118 options; Mr Andrew David Dyer – 147,059 options. xv) Class L Options exercisable at $0.75 on or before 8 November 2020 Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Holders 9 25 26 81 10 Units 8,102 66,393 219,695 2,829,593 6,823,1681 % 0.08 0.67 2.21 28.45 68.60 151 9,946,951 100.00% 1 Holders who hold more than 20% of securities are: Citicorp Nominees Pty Limited – 2,500,000 options. xvi) Class M Options exercisable at $1.93 on or before 29 January 2023 Holders Units 1 Holders who hold more than 20% of securities are: 3XC Pty Ltd – 300,000 options. 300,0001 100.00 300,000 100.00% 95 Shareholder information continued xvii) Class N Options exercisable at $0.85 on or before 14 October 2023 Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Holders Units 971,6381 100.00 971,638 100.00% – – – – – – – – – – – % – – – – % – – – – % – – – 471,9381 100.00 471,938 100.00% 436,677 100.00 – – 436,6771 100.00% – – – – 4 4 – – – – 2 2 – – – 15 – 15 1 Holders who hold more than 20% of securities are: 3XC Pty Ltd – 277,611 options Mr Andrew David Dyer – 277,611 options; Farrelly Investments Pty Ltd –208,208 options; L Graham Trustees Limited + Erca Trustees (LG) Limited –208,208 options. xviii) Class P Options exercisable at $1.70 on or before 7 February 2024 Holders Units 1 Holders who hold more than 20% of securities are: Anthony DuPreez – 235,969 options Mr Matthew Watson – 235,969 options. xix) Class B Restricted Stock Units Holders Units 1 Securities were issued under an Employee Share Scheme, therefore disclosure of holders with more than 20% of securities is not required under ASX Listing Rule 4.10.16. 96 Bid Annual Report 2020 Shareholder information continued xx) Class C Restricted Stock Units Shares Range 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 and above Total Holders – 1 2 3 – 6 Units – 2,397 12,258 53,970 – % – 3.49 17.86 78.64 – 68,6251 100.00% 1 Securities were issued under an Employee Share Scheme, therefore disclosure of holders with more than 20% of securities is not required under ASX Listing Rule 4.10.16. 4. Substantial Shareholders The names of the substantial shareholders listed on the Company’s register as at 1 August 2020 are: Name: Blue Lagoon International Corporation Holder of: 52,766,975 fully paid ordinary shares, representing 8.18% as at 8 August 2017 Notice Received: 14 August 2017 Name: Merriwee Pty Ltd Holder of: 42,500,000 fully paid ordinary shares, representing 5.74% as at 22 June 2018 Notice Received: 26 June 2018 Name: TIGA Trading Pty Ltd and associated entities Holder of: 8,974,296 fully paid ordinary shares, representing 6.87% as at 27 March 2020 Notice Received: 31 March 2020 5. Restricted Securities There are no restricted securities listed on the Company’s register as at 1 August 2020. 6. On market buy-back There is currently no on market buy‑back in place. 97 Shareholder information continued 7. Twenty Largest Shareholders The twenty largest shareholders of the Company’s quoted securities as at 1 August 2020 are as follows: Name No. of Shares 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED CITICORP NOMINEES PTY LIMITED UBS NOMINEES PTY LTD BLUE LAGOON INTERNATIONAL CORPORATION NATIONAL NOMINEES LIMITED AUCTION DESIGN PTY LTD HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED – A/C 2 BLUE LAGOON INTERNATIONAL CORPORATION CAROLYN PALMER G4 INVESTORS PTY LTD CASSA TRADING PTY LTD NAILO PTY LTD EMHAL PTY LTD ALLINSON TRAUTS PTY LTD RJIR PTY LTD JONAHLUCA PTY LTD MRS IVONNE VONNY SOBIRIN‑WENAS ALLINSON TRAUTS PTY LTD < C S ALLINSON SUPER FUND A/C> AUCTION DESIGN PTY LTD 20 LSF 2000 PTY LTD 12,607,359 9,286,384 9,074,296 5,824,545 4,619,978 4,500,352 4,217,922 2,797,666 2,787,472 2,000,000 1,645,113 1,604,152 1,500,000 1,471,392 1,408,169 1,377,795 1,086,496 1,004,152 1,000,000 900,000 % 9.64 7.10 6.94 4.45 3.53 3.44 3.22 2.14 2.13 1.53 1.26 1.23 1.15 1.12 1.08 1.05 0.83 0.77 0.76 0.69 Total 70,713, 243 54.05% 98 Bid Annual Report 2020 THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK. 99 THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK. 100 Bid Annual Report 2020 Corporate directory Auditor RSM Australia Partners Level 21, 55 Collins Street Melbourne, Victoria 3000 Stock exchange listing BidEnergy Limited securities are listed on the Australian Securities Exchange (ASX code: BID) Website www.billidentity.com Corporate Governance Statement The Company’s Corporate Governance Statement and Corporate Governance Plan are available on the Company’s website at https://bidenergy.com/investors/ Directors Geoffrey Kleemann (Interim Chairman) Guy Maine (Managing Director) Leanne Graham (Non‑Executive Director) David Hancock (Non‑Executive Director) Company secretary Lior Harel Registered office Level 49, 360 Elizabeth Street Melbourne, Victoria 3000 Phone: 1800 319 450 Principal place of business Level 49, 360 Elizabeth Street Melbourne, Victoria 3000 Phone: 1800 319 450 Share register Computershare Investor Services Pty Ltd Level 2, 45 St Georges Terrace Perth, Western Australia 6000 Phone: (03) 9415 4062 www.colliercreative.com.au #BID0008 B i d | A n n u a l R e p o r t 2 0 2 0 billidentity.com