Spectur Limited
Appendix 4E
Preliminary Financial Report- For the year ended 30 June 2021
(Previous corresponding period: Year ended 30 June 2020)
Results for announcement to the market
1. Results for announcement to the market
30 June 2021
Current Year
$
Percentage
Change
Up /(Down)
%
Change
Up /(Down)
$
30 June 2020
Previous
Corresponding
Year
$
Revenue from ordinary activities
5,248,882
9.3%
447,227
4,801,655
Loss from ordinary activities after tax
(1,755,415)
(8.2%)
(132,717)
(1,622,698)
Net Loss for the period attributable to members
(1,755,415)
(8.2%)
(132,717)
(1,622,698)
Commentary on the above figures is included in the attached Annual Financial Report for the year ended 30 June
2021.
2.
3.
4.
5.
6.
7.
Statement of Profit and Loss and other comprehensive income
Refer to attached Annual Financial Report – 30 June 2021.
Statement of financial position
Refer to attached Annual Financial Report – 30 June 2021.
Statement of cash flows
Refer to attached Annual Financial Report – 30 June 2021.
Statement of changes in equity / retained earnings
Refer to attached Annual Financial Report – 30 June 2021.
Dividend payments
Refer to attached Annual Financial Report – 30 June 2021.
The Company does not propose to pay any dividends in the current year.
Dividend reinvestment plans
The Company does not have a dividend reinvestment plan.
This Appendix 4E Annual Report is provided to the ASX under Listing Rule 4.3 and should be read in
conjunction with the accompanying Financial Report for the year ended 30 June 2021.
8.
Net tangible assets per security
Net Tangible Assets per ordinary share
Current Year
(30 June 2021)
1.82 cents
Previous
Corresponding Year
(30 June 2020)
2.58 cents
9.
Details of entities over which control has been gained or lost
Not applicable
10.
Details of Associates and joint ventures
Not applicable
11.
Other significant information
Not applicable
12.
Foreign entities – Accounting Standards
Not applicable.
13.
Results for the period
Refer to the Directors report in the attached Annual Report.
14.
Statement on the financial statements
The financial statements are based on audited accounts.
15.
Unaudited accounts
Not applicable.
16.
Status of audit
The Financial Report for the year ended 30 June 2021 has been audit reviewed and is not subject to
dispute or qualification.
This Appendix 4E Annual Report is provided to the ASX under Listing Rule 4.3 and should be read in
conjunction with the accompanying Financial Report for the year ended 30 June 2021.
Spectur Limited
ACN 140 151 579
Annual Financial Report
30 June 2021
Content
Corporate Information
Managing Director’s Review
Directors’ Report
Remuneration Report
Auditor’s Independence Declaration
Statement of Profit or Loss and Other Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Note 1: Basis of Preparation
Note 2: Significant Accounting Policies
Note 3: Significant Accounting Estimates and Judgements
Other Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Additional Securities Information
3
4
6
12
23
24
25
26
27
28
30
37
39
59
60
64
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 2 of 66
Corporate information
ACN 140 151 579
Directors
Mr Darren John Cooper
Dr Gerard John Dyson
Ms Bilyana Smith
Company Secretary
Mrs Suzie Jayne Foreman
Registered Address and Principal Place of Business
12 Fargo Way,
Welshpool, WA 6106
Telephone: 1300 802 960
Solicitors
Blackwall Legal LLP
Level 26, 140 St Georges Terrace,
Perth, Western Australia 6000
Bankers
ANZ Bank
127/816 Beeliar Drive
Success, WA 6164
Auditors
HLB Mann Judd (WA Partnership)
Level 4, 130 Stirling Street
Perth, WA 6000
Share Registry
Automic Registry Services
Level 2, 267 St Georges Terrace
Perth, WA 6000
GPO Box 5193, Sydney, NSW 2001
Telephone: 1300 288 664 (within Australia)
Email: hello@automic.com.au
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 3 of 66
Managing Directors’ Review
Managing Director’s Review
Dear Fellow Shareholder,
Financial year 2021 was a rollercoaster for Spectur Limited, as it was for many companies and people in our community.
Following on from a challenging H2 FY20, our customers, business and people remained exposed to a market characterised
by extended lockdowns and uncertainty. The second half of the financial year saw sentiment improve with the advent of
increasingly available vaccines, as well as an ongoing shift in the Spectur business as management implemented its growth
strategy. The contrast in halves was stark in financial terms. Against an uncertain global backdrop, Spectur executed
strategy consistent with a strengthening corporate culture based around our shared values and vision for the business.
Vision, Values and Mission
Following the strategic direction that the Company set in mid-2020, Spectur has been on a journey evolving from a product-
oriented business to a solutions-oriented business. Our corporate vision is to harness the power of renewable energy to
bring autonomous sensing, thinking and action to customers outdoors. This has shaped the customer sectors we have
targeted, the products and solutions we have developed and the technology we are researching. To deliver on this vision,
our chosen pathway (or mission) is through:
• A premium offering;
• Constant evolution of our sales and technology towards more differentiated and less commodified solutions; and
•
Improving and maturing our internal processes and systems to support these pathways.
We pursue this mission towards our vision in a culture characterised by honesty, customer focus, innovation, excellence
and team orientation. We have made some positive strides in FY21 and I am proud of this business, the people in it and the
positive difference that we make to our communities.
FY21 strategy review
Spectur’s strategic plan for FY21 was built around four key pillars:
1. Expanding product lines
2. Gaining entry into major projects
3. Adding sales channels; and
4.
Improving sales through enhanced marketing.
Against these objectives we scored highly.
FY21 saw the introduction of the STA6 platform to Spectur, bringing an unprecedented level of capability and features to
the market. The STA6 platform delivers up to 4 cameras in 4k ultra-low light configuration, paired with advanced 32-bit
processors equipped with uniquely programmable edge artificial intelligence. This platform delivers the first production-
scale solar-powered “fog computing” platform into the market. Market demand exceeded supply for much of H1 and was
addressed in H2.
Spectur also expanded the HD5 platform range to include material variants solving safety, warning and communications
needs. Incorporating sophisticated and robust two-way (video and audio) communications as well as advanced prototyping
of a digital signboard, these variants are now ready for broader scale production and sales.
Major projects were another area where Spectur made considerable strides. In FY20, Spectur did not secure new contracts
with values above $100k. In FY21, Spectur secured nearly $2m of contracts with values in excess of $100k. This
transformation in order size and customer quality was in response to the implementation of the outbound sales team and
processes, ongoing account management and the development of compelling technology that could meet customer needs
at scale.
This financial year was also characterised by unprecedented and welcome stability in our sales team. With the final hires
occurring in July and August 2021, the sales team is experienced and familiar with the Spectur solutions. The fruits of
extended outbound prospecting and customer account management are being harvested. The addition of Mr Robin Walford,
a very experienced Sales Manager (and former CEO) ultimately into the role of Chief Sales and Operations Officer, rounded
out the team at the end of H1 and is propelling ongoing growth in the sales pipeline.
In addition to the maturing of the sales team, Spectur also investigated growing a number of additional sales channels, the
most notable of which culminated in the formation of a joint venture with Deus-Ex Limited in NZ to create Spectur NZ. This
business is now established, generating revenues and is expected to increase its contributions in FY22.
The final element of the FY21 strategy was to grow sales through enhanced marketing. Spectur engaged a highly respected
digital marketing partner, concluded the bottom-up build of a new website that reflected our corporate strategy and
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 4 of 66
Managing Directors’ Review
experimented with a range of different outbound and inbound marketing strategies. Whilst “success has many fathers”,
enhanced marketing was surely a material contributor to revenue improvement of nearly 60% in H2 over H1.
Financial results
As discussed above, Spectur’s FY21 financial performance was a tale of two halves. The first half of the year was
characterised by very tight cost control and cost reduction, whilst available funds were invested in future growth around
marketing, sales and technology. The second half of the year saw the fruits of earlier investments and the growth of the
pipeline. Key milestones and metrics include:
•
•
•
Revenue growth from FY21 H1 of $2.04m to FY21 H2 $3.21m – nearly 60%.
Reduction in loss from FY21 H1 of $1.02m to FY21 H2 $740k – more than 25% improvement.
Finished the financial year with $1.69m of cash and an unused debt facility of $1.5m.
FY22 strategy
The current (FY22) financial year brings an evolution and compounding of the successful elements and investments in
FY21. Core strategic elements include:
1. Evolving the customer profile towards more differentiated buyers
Core to our mission has been the provision of a differentiated offering to sustain the historically high gross margins that
Spectur has enjoyed. In the coming period, Spectur will continue to invest in outbound sales effort and associated targeted
marketing on customers that value a differentiated or unique offering and can buy at scale. At present this focus continues
to be on government, utilities and construction customers, and is expanding incrementally towards adjacent groups.
2. Product and technology advances
Increased connectivity with customers has meant that Spectur has greater visibility on current and future needs of target
sectors. This financial year will see further development of the core platforms, including the STA7, roll out of a broader
range of internal and third-party AI applications and deployment of the expanded IoT sensing suite that will complement our
current security, surveillance, safety and warning solutions. It is also expected that broader commercialisation of the two-
way communications capabilities developed in FY21 (VOIP phones and digital signboards) will continue.
3. Production scaling
FY22 will see ongoing evolution in the methods of production of core technology, whilst investigations and plans are made
for future, larger scale production. A range of options considering geography, advanced manufacturing technologies,
shipping and capital costs will be considered in the preparation of this longer-range blueprint for production scaling. Spectur
production capability needs to be ready for efficient, broader geographical deployment.
4. System and process maturation
As Spectur moves from start up to scaling up, internal systems and processes, including enterprise resource planning
(ERP), will be upgraded, matured and evolved, to deliver higher reliability, lower cost and overall improved performance.
Outlook
As of 25 August 2021, Spectur has increased the unweighted pipeline to $5.62m of work ($2.33m of weighted pipeline), a
stable and engaged workforce, strong technical and institutional foundations and a clear plan to drive sustainable growth.
Whilst there remains the ever-present potential of government-enforced lockdowns, pandemics and other events beyond
the control of Spectur, the need for our solutions remains clearer than ever and the resilience of our target customer base
increases. For comparative purposes, even with more than half of the country in lockdown, the revenues for July 2021 are
more than 40% higher than those experienced in July 2020.
We plan to inform the market of our ongoing technical developments, strategy implementation and material sales results
throughout the year, demonstrating the predictable delivery of our plans. Thank you for your support during these interesting
times. Spectur has a unique position in a global marketplace worth more than a billion dollars (solar sensing, thinking and
action). We look forward to sharing this journey with you.
Yours sincerely,
Gerard Dyson
Managing Director
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 5 of 66
Directors’ Report
The Board of Directors of Spectur Limited present their report on Spectur Limited (“Company” or “Spectur”) for the year
ended 30 June 2021.
Directors and Officers
The names of directors and officers who held office during or since the end of the year and until the date of this report are
as follows.
Darren John Cooper
Gerard John Dyson
Bilyana Smith
Non-Executive Chairman
Managing Director
Non-Executive Director
Suzie Jayne Foreman
Company Secretary
Current Directors and Officers
Mr Darren John Cooper
Qualifications
Length of Service
Experience
Special Responsibilities
Gerard John Dyson
Qualifications
Length of Service
Experience
Special Responsibilities
Ms Bilyana Smith
Qualifications
Length of Service
Experience
Special Responsibilities
Independent Non-Executive Chairman
B.Bus (Curtin), Masters of Applied Finance (Macquarie), Australian Institute of Company
Directors graduate.
2 years, 10 months
Darren Cooper spent in excess of 20 years with various companies in management and
senior executive roles. Darren now holds a number of Board and Strategic Advisory roles
across a range of industries including property, construction, labour hire, professional
services and telecommunications. He is also an investor in and director of a range of
technology & media-based start-up businesses.
Chairman of the Remuneration and Nomination Committee
Managing Director
B.Eng (Hons, Civil), B.Com (Mgmt, Mktg), PhD (Geotechnical Engineering) from the
University of Western Australia, Adv Dip Bus from Federation University, Graduate of the
Australian Institute of Company Directors.
2 years as Managing Director
Gerard Dyson is a seasoned Managing Director and prior to joining Spectur held the role
of Executive Vice President and Regional Managing Director, Americas for Advisian, a
global consulting and advisory firm of Worley Limited (ASX:WOR), from 2015 to 2018. Dr
Dyson has held a number of global, regional and local roles in Australia, USA, Canada,
Latin America, Asia and the Middle East, including as Group Managing Director,
Infrastructure in 2014 to 2015 and Director of Consulting, Australia & New Zealand from
2011 to 2014. Dr Dyson has also led sales teams, developed and implemented strategy
and has strong experience in infrastructure, environment, mining, power and chemicals
sectors.
N/A
Independent Non-Executive Director
MBA from University of Sydney, Bachelor of Architecture, Australian Institute of Company
Directors graduate (GAICD).
1 year 10 months
Bilyana has extensive international experience as a company director, CEO, investor and
strategic advisor. She is Non-Executive Director and member of the Remuneration and
Nomination Committee member with Spectur. Also Board Director with Fishburners Ltd,
Senior Advisor with First Home London, she runs her own advisory practice specialising
in business strategy and innovation. Bilyana holds MBA from the University of Sydney,
Bachelor of Architecture and is a graduate of the Australian Institute of Company
Directors graduate (GAICD). She lives in Sydney.
Remuneration and Nomination Committee member
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 6 of 66
Directors’ Report
Directorships of other listed companies
Directorships of other listed companies held by directors currently and in the 3 years immediately before the end of the
financial year are as follows:
Name
Mr Darren John Cooper
Dr Gerard John Dyson
Ms Bilyana Smith
Company
GO2 People Limited
Netccentric Limited
-
-
Period of directorship
28 July 2017 - date
1 Sept 2020 - date
-
-
Company Secretary for the reporting period
Mrs Suzie Jayne Foreman
Company Secretary
Qualifications: B Comm (Econs), CA, FGIA.
Ms Foreman is a Chartered Accountant and Governance Institute Fellow member, with over 20 years of experience within
the UK and Australia, including 11 years combined experience with a Big 4, and a boutique advisory firm, specialising in the
areas of audit and corporate services. Ms Foreman has extensive experience in senior management roles including as a
Chief Financial Officer and Company Secretary for a range of ASX listed entities from ASX top 300 tier entities to start-up
enterprises. Ms Foreman is skilled in cash flow, governance and enterprise risk management, financial reporting, audit, and
company secretarial work. Suzie has been involved in the listing of over 15 entities on the Australian Securities Exchange
over the past 20 years and involved in capital raisings and M&A transactions exceeding $300 million in total.
Ms Foreman has previously held numerous Company Secretarial, Non-Executive Directorships, and/or Chief Financial
Officer positions for ASX listed entities and is the Company Secretary of AIM and ASX listed Oilex Limited.
Principal activities
The principal activity of the Company during the year was to develop, manufacture and sell remote sensing, thinking and
acting solutions powered by solar and using the IoT [Internet of Things], camera and cloud-based technology.
Operating and Financial Review
Results of Operations
For the year ended 30 June 2021, Spectur reported total revenue of $5.2M, an approximate 8% increase on the
corresponding prior year revenue of $4.8M.
Gross margins declined to 60% in FY2021 from 64% in the prior year, as the Company launched a new product line and
absorbed some increases in costs within the component supply chain. Earnings / Loss before Interest, Tax and Depreciation
and Amortisation (EBITDA) fell to $1.74M (loss) from the prior period loss of $1.47M. (Note EBITDA is adjusted for share-
based compensation, one off income / expenses (including COVID-19 relief), impairments, write downs, one off gains /
losses and non-cash expenses .)
Spectur’s financial position remains strong with minimal debt of $61k (excluding office lease liabilities) and a cash balance
of $1.7M at year end (2020: $1.6M). The Company’s balance sheet is strengthened by access to a loan facility of $1.5M,
which can be drawn down from 1 July 2021. The comprehensive loss for the year ended 30 June 2021, after providing for
income tax, amounted to $1.76M (2020: $1.62M).
Dividends
No dividends were paid or declared since the start of the financial year. No recommendation for payment of dividends has
been made.
Significant events during the year
Capital Raising
On 16 July 2020, Spectur finalised a placement, raising $567,248 through the issue of 11,344,960 shares at 5 cents per
share. In parallel, the Company announced a non-underwritten Share Purchase Plan (SPP), which closed significantly
oversubscribed. The Company raised $945,413 in the SPP via the issue of 18,908,267 new shares at 5 cents per share.
New Zealand Acquisition
On 25 November 2020, and in line with its expansion strategy, Spectur announced the acquisition of Spectur New Zealand
Limited. Spectur subscribed for 51% of the shares in Spectur NZ via a capital injection of $10,149 and Deus Ex 49% via a
subscription of $9,751. Inventory and other contributions are to be funded via loans from the shareholders (Spectur and
Deus Ex) proportionate to their shareholding.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 7 of 66
Directors’ Report
Loan Facility
Spectur entered into a binding loan facility for A$1.5 million with its largest shareholder EGP Capital (Lender). The
Agreement was completed on 14 May 2021, with draw down possible from 1 July 2021, and material terms as follows:
• Drawdowns at the election of the borrower, to be in minimum amounts of $100,000 and multiples of $50,000 with
30 days’ notice.
• No security - Negative pledge obligation only;
•
•
•
•
Fixed interest rate of 7.0% p.a. on drawn amounts;
Line fee of 3% p.a. on total value of facility, effective 1 July 2021;
30-month term, with flexibility to repay at an earlier date;
the Company will issue the following options to the Lender, subject to approval by shareholders at the Company’s
Annual General Meeting:
o
2.25 million unquoted options to acquire fully paid ordinary shares in Spectur, exercisable at $0.12, on or
before 31 December 2023. Should shareholder approval not be obtained, the outstanding loan principal and
any fees / interest outstanding will be repaid within 45 days.
Financial Covenants – At all times, the amount of the drawn Facility is not to exceed the aggregate of:
➢ Spectur’s cash at bank;
➢ 50% of Spectur’s < 90 day debtors;
➢ 50% of the value of Spectur’s rental fleet and finished stock; and
➢ 50% of the value of Spectur’s other inventory.
o
Spectur is to report to the financier on these matters for each month by the 21st day of the following month.
• Repayment election – Subject to obtaining the necessary shareholder approvals, if required, Spectur may, at its
election, elect to repay all or part (in multiples of $100,000) of the outstanding amount under the Facility in the
form of fully paid ordinary shares in lieu of cash. Each share will be issued at a 20% discount to the 30-day volume-
weighted average price of Spectur shares traded on ASX leading up to the repayment date.
Employees
The Company had 31 employees as at 30 June 2021 (2020: 25 employees).
Loss per share
Basic loss per share (cents per share)
30 June 2021
(1.70)
30 June 2020
(2.25)
Subsequent events after the reporting date
On 23 July 2021 Spectur completed the allocation of incentive awards to certain key management and senior employees
under its Employee Incentive Scheme approved at the Company's 2019 Annual General Meeting (Scheme).
Long Term Incentives - Performance Rights
3,065,012 Performance Rights were allocated and issued to key management personnel and senior employees (other than
directors) under the Scheme as long-term incentives.
In addition to the above issue, and pursuant to his Executive Employment Contract, Managing Director Dr Gerard Dyson,
has been allocated 2,083,333 Performance Rights on the same terms and conditions. The issue of the Performance Rights
to Dr Dyson is conditional on the receipt of shareholder approval which is to be sought at the Company’s 2021 Annual
General Meeting (AGM).
The Performance Rights are issued for nil cash consideration, but will not vest unless the performance conditions set by the
Board have been satisfied, with the final quantum to be determined on the vesting and measurement date of 30 June 2023.
Refer to Section E of the Remuneration Report for the details of the performance conditions.
Incentive Options
In recognition of the continued dedication of the key management and senior employees of Spectur, in particular during
FY20 and FY21, throughout periods of Company imposed salary reductions, the Board issued 2,200,000 unquoted Options
to members of Spectur’s key management personnel (other than Directors) under the Scheme.
The Options are exercisable at $0.10, being a 43% premium to the SP3 5-day Volume Weighted Average Share Price
(VWAP) prior to 30 June 2021, and have an expiry date of 30 June 2014. The Options are not subject to vesting conditions.
The Board has also resolved to issue, conditional on the receipt of shareholder approval to be sought at the AGM, 2,100,000
Incentive Options under the Scheme as follows:
•
•
1,100,000 Incentive Options to the Managing Director, Dr Gerard Dyson; and
500,000 Incentive Options to each of the Non-Executive Directors, Bilyana Smith and Darren Cooper.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 8 of 66
Directors’ Report
The Director Incentive Options will be unquoted, exercisable at a 42% premium to the VWAP to be calculated based upon
the 5-day period up to and including the date of the AGM. The Options will not be subject to vesting conditions.
Cancellation of Performance Rights
A total of 1,024,676 FY20 and FY21 Performance Rights were cancelled due to the vesting conditions no longer being
attainable due to cessation of employment.
The Directors are not aware of any other matter or circumstance that has arisen since 30 June 2021 which significantly
affected, or may significantly affect, the operations of the Company, the results of those operations, or the state of affairs of
the Company, in future financial years.
Laws and Regulations
Spectur’s operations are subject to various laws and regulations under the relevant government legislation. Full compliance
with these laws and regulations is regarded as a minimum standard for all operations to achieve the objectives of the
Company. Instances of environmental non-compliance by an operation are identified either by internal investigations,
external compliance audits or inspections by relevant government agencies. There have not been any known breaches of
laws and regulations by the Company during the year and up to the date of this report.
Indemnifications and Insurance of Officers
The Constitution of the Company requires the Company, to the extent permitted by law, to indemnify any person who is or
has been a director or officer of the Company for any liability caused as such a director or officer and any legal costs
incurred by a director or officer in defending an action for any liability caused as such a director or officer.
The Company has a Directors and Officers insurance policy in place.
Directors’ meetings
The number of meetings of Directors (including meetings of Committees of Directors) held during the year and the number
of meetings attended by each Director were as follows:
Director
FY21
Darren Cooper
Bilyana Smith
Gerard Dyson
Directors’ meetings
No. eligible to attend
14
14
14
No. attended
14
14
14
Remuneration Committee meetings
No. attended
3
3
-
No. eligible to attend
3
3
-
In addition to the above meetings, the board executed 2 circular resolutions during the year.
Securities on issue
Total shares, options and performance rights of the Company on issue as at the date of this report are as follows:
Number of fully paid
ordinary shares
Number of options over
ordinary shares
Number of performance
rights
106,305,280
2,200,000
8,496,144
Directors’ holdings of shares, options and performance rights during the financial period have been disclosed in the
Remuneration Report. Option or performance rights holders do not have any right, by virtue of their option / performance
rights, to participate in any share issue of the Company.
Shares under option or issued on exercise of options
At the date of this report, unissued ordinary shares or interests of the Company under option are:
Type
Unlisted
Total
Number of shares under
option
Exercise price of
option
Expiry date of option
2,200,000
2,200,000
$0.10
30 June 2024
There were no shares issued during the year as a result of an exercise of Options.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 9 of 66
Directors’ Report
Performance Rights
As at the date of this report, the following performance rights (PRs) in the Company were on issue.
Type
Date of Expiry
Employee
LTI Issued
FY20
Employee
LTI Issued
FY21
Employee
LTI Issued
FY22
12 months from reporting of
the Company’s audited FY22
financial statements
12 months from reporting of
the Company’s audited FY23
financial statements
12 months from reporting of
the Company’s audited FY23
financial statements
No. of Performance
Rights on Issue
1,787,265
Vesting Conditions
Earnings per share (75%) and total shareholder
return (25%) weighted targets.
3,643,868
Earnings per share (75%) and total shareholder
return (25%) weighted targets.
3,065,012
Revenue (50%) and EBITDA (50%) weighted targets.
Proceedings on behalf of the Company
No person has applied for leave of court to bring proceedings on behalf of the Company or intervene in any proceedings to
which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those
proceedings. The Company was not a party to any such proceedings during the year.
Future Developments
The last twelve months saw the consolidation of a revised marketing strategy, a stabilised outbound sales team and a new
product line (the STA6). Spectur’s focus in the coming twelve months is to:
•
•
•
Continue the migration of the customer base from more transactional inbound customers to more strategic
customers in our target sectors of government and utilities, major construction and adjacent groups. In particular,
the Company is looking to focus on customers where the differentiated capabilities of Spectur around
customisation, integration, low power and data management and “fog” computing can be leveraged.
Further optimise and narrow the focus of marketing activities to target key customer groups and support the sales
process. This will include key outbound events, publications and other digital marketing.
Extend the next phase of the research and development long term roadmap. This includes a number of key
performance, reliability, cost and production related elements of existing platforms as well as the development of
new features and the next generation STA7. Ultimately, Spectur is seeking to build a fully modular software and
hardware platform in the next three-year period, integrating core Spectur technology with third party sensing, AI
and peripherals.
• Mature internal processes as the business increases scale. Combined with the implementation of a new, company
wide, Microsoft Dynamics ERP, processes around research and development through to production will be
matured and documented supporting scaling, efficiency in execution and the ability to interact productively with
partner organisations.
Diversity
The Company believes that the promotion of diversity on its Board and within the organisation generally is good practice
and is committed to managing diversity as a means of enhancing the Company’s performance. The Company has two
Officers / Directors who are female, Bilyana Smith (Non-executive director) and Suzie Foreman (company secretary).
Further information is set out in the Corporate Governance statement detailed on the Company’s website.
Non-audit services
No non-audit services were provided by the Company’s auditor, HLB Mann Judd during the year.
Auditor independence
Section 307C of the Corporations Act 2001 requires our auditors, HLB Mann Judd, to provide the Directors of the Company
with an Independence Declaration in relation to the audit of the annual report. This Independence Declaration is set out on
page 23 and forms part of this Directors’ report for the year ended 30 June 2021.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 10 of 66
Directors’ Report
Director's interests
Interests in the shares, options and performance rights of the Company and related bodies corporate
The following relevant interests in shares and options and performance rights of the Company or a related body corporate
were held by the Directors as at the date of this report.
Directors
Darren John Cooper
Bilyana Smith
Gerard John Dyson
Total
Number of fully paid
ordinary shares
Number of options
over ordinary shares
Number of
performance rights
2,503,879
749,614
1,462,179
4,715,672
-
-
-
-
-
-
4,909,806
4,909,806
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 11 of 66
Remuneration Report (Audited)
Remuneration Report Contents
A.
Introduction
B. Remuneration governance
C. Remuneration policy framework
D. Remuneration structure and link to business strategy
E. Executive remuneration framework and overview of incentive plans
F.
Link between performance and remuneration outcomes
G. Non-executive Directors’ remuneration
H. Executive service agreements / remuneration
I. Additional statutory disclosures
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 12 of 66
Remuneration Report (Audited)
A. Introduction
This report, which forms part of the Directors’ report, outlines the remuneration arrangements in place for the key
management personnel (KMP) of Spectur Limited for the financial year ended 30 June 2021. The information provided in
this remuneration report has been audited as required by Section 308(3C) of the Corporations Act 2001.
For the purposes of this report KMP are defined as those persons having authority and responsibility for planning, directing
and controlling the major activities of the Company, directly or indirectly, including any director (whether executive or
otherwise) of the Company. For FY21 it was deemed that only the Managing Director qualified as executive KMP for the
purposes of this report.
Key Management Personnel (KMP)
The KMP of the Company during or since the end of the financial year were as follows:
Current Directors
Mr Darren John Cooper
Dr Gerard John Dyson
Ms Bilyana Smith
Non-Executive Chairman
Managing Director (Executive)
Non-Executive Director
Full Term
Full Term
Full Term
Position
Period of Employment (to present)
The Spectur Board is committed to transparent disclosure of its remuneration strategy and this report details the Company’s
remuneration objectives, practices and outcomes for KMP, which includes all directors, for the period ended 30 June 2021.
B. Remuneration Governance
Spectur Board
Overall responsibility for ensuring Spectur’s remuneration strategy is aligned with Company performance and
shareholder interests and is equitable for participants.
Reviews, and as appropriate, approves recommendations from the Company’s Remuneration and Nomination
Committee (RNC).
Remuneration and Nomination Committee (RNC)
The RNC may use independent advisors to provide advice,
remuneration benchmarking data and market
trend
information. No external advisors provided advice or
remuneration recommendations for FY21, as defined under
section 300A of the Corporations Act.
Monitors, recommends and reports to the Board on:
The remuneration policies and framework;
➢
➢ Non-executive Director remuneration within the fee
pool approved by shareholders;
➢ Remuneration for the Managing Director, and equity-
based compensation for the leadership team and
other key management personnel as recommended
by the Managing Director;
➢ Managing Director incentive arrangements;
➢ Board remuneration including terms and conditions of
➢
appointment and retirement;
Induction of new non-executive directors and
evaluation of board performance.
The board retains discretion to adjust STI outcomes.
All variable remuneration is subject to Board approval prior to grant / payment.
Managing Risk
The members of the RNC currently are:
▪ Chairman – Darren Cooper
▪ Member – Bilyana Smith
▪ Secretary – Suzie Foreman
C. Remuneration Policy Framework
The key objective of Spectur’s remuneration policy is to be an enabler for the Company in achieving its strategic goal of
continuing to build a successful remote solar-powered sensing and cloud-based technology solutions company. The
remuneration framework is designed to attract and retain high caliber talent by rewarding them for achievement of goals
designed to deliver shareholder value.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 13 of 66
Remuneration Report (Audited)
Remuneration Policy
The Company’s remuneration framework has been designed to reward executives and employees fairly and responsibly
in accordance with the market in which the Company operates. Remuneration is performance driven, market completive,
and aligns with shareholder interests.
Performance Driven
Market Competitive
Aligns with Shareholders
Remuneration Strategy
Sets demanding levels of expected
performance that have a clear linkage
to an executive’s remuneration.
Rewards are based upon achievement
of targets aligned to the Company’s
business plans and longer-term
strategy.
Variable components (short and long
term) are driven by challenging
focused on external and
targets
internal measures of financial and
non- financial performance.
A proportion of
remuneration is “at risk.”
the executive’s
remuneration against
Benchmarks
appropriate comparator peer groups
to make the Company competitive in
the human resources market, through
an offering of both short and long-term
incentives and competitive base
salaries.
Provides competitive rewards that
attract, retain and motivate executives
and employees of the highest caliber,
who
deliver,
particularly as the Company moves
through a rapid growth phase.
successfully
can
level of remuneration
Provides a
structure to reflect each executive’s
respective duties and responsibilities.
Aligns executive incentive rewards
with
for
the creation of value
shareholders through an emphasis on
variable remuneration. Incentive plans
and performance measures are
aligned with the company’s success.
in
term
Equity participation
incentive plan
to
executives and the leadership and
senior management team of Spectur.
(LTIP) applies
long
D. Remuneration Structure
The proportion of fixed remuneration and variable remuneration is established for the Managing Director by the RNC with
reference to market comparator data and the scope of the Managing Director’s role and is approved by the Board in
accordance with the Remuneration Policy and the provisions of the Short Term Incentive (STI) and Long Term Incentive
(LTI) Plans. These elements are both described in detail below. Non-executive Directors are excluded from participation.
Fixed Remuneration
Variable Remuneration
Fixed remuneration is made up of
base salary, superannuation.
Variable component of executive target remuneration mix allows a greater
share of remuneration at risk and subject to performance.
Fixed remuneration is targeted at the
remuneration paid to executives of
relevant comparable peer group of
ASX companies taking into account
the executive’s role, responsibility,
skills and previous experience.
STI (at risk)
LTI (at Risk)
➢ Cash based payment based upon
percentage of base salary.
LTI plan in the form of performance
rights.
➢ STI hurdles based upon the
achievement of certain stretched
specified KPI’s during the financial
year over which the executive
would be able to exert sufficient
control to achieve a demonstrated
strategic outcome in his role.
➢ The targets can consist of KPI’s
covering both financial and non-
financial measures of performance
and may be based on company,
individual, business and personal
objectives.
➢ Grants made annually with vesting
after three financial years, note
this was reduced to two years for
FY22.
➢ Performance hurdles reviewed
annually by the Board to align with
the Company’s strategic plan.
-
-
The hurdles applied to
reflect stretched
achievement against the
Company’s long-term
strategic goals.
Shareholder Return tested
at the end of 2/3-year
period.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 14 of 66
Remuneration Report (Audited)
E. Executive remuneration framework and overview of incentive plans
Variable Remuneration – Short Term Incentive Plan
Short Term Incentive Plan (STIP)
Aspect
Purpose
Plan, Offers and Comments
This element of remuneration aims to provide an incentive for executives to deliver on or
outperform annual business plans that will lead to sustainable and superior returns for
shareholders.
Measurement period
The Company’s financial year (tested at the end of the financial year).
Award opportunities
FY21
The Managing Director was offered a target based STIP equivalent of up to 35% of the base
package for target performance, with a maximum/stretch opportunity of up to 50% of the
base package for achievement of the high case target.
FY22
The Managing Director was offered a target based STIP equivalent of up to 35% of the base
package for target performance, with a maximum/stretch opportunity of up to 50% of the
base package for achievement of the high case target.
Key Performance
indicators, weightings
and performance goals
The operational targets consist of several KPI’s covering both financial and non-financial
measures of performance and may be based on company, individual, business and
personal objectives.
FY21
➢ H1 and H2 targets and weightings set to
- financial performance - Revenue (75%); and EBITDA (25%).
FY22
➢ H1 and H2 targets and weightings set to
- financial performance - Revenue (50%); and EBITDA (50%).
Award determination and
payment
Calculations are performed following the end of the measurement period and the audit of
Company accounts. The Board retains discretion to modify outcomes to ensure that the
STIP does not produce outcomes that shareholders would be likely to consider
inappropriate.
FY21
For FY21 approximately 11% of the potential bonus award pool is payable as a result of
achievement of EBITDA financial targets for key management and senior employees. 100%
of awards are made in cash with PAYG tax deducted.
FY22
100% of awards to be made in cash with PAYG tax deducted, following the measurement
against the Company’s FY22 audited accounts.
All entitlements in relation to the measurement period are forfeited.
Cessation of employment
during measurement
period
Plan gate and discretion With Safety performance as a “deleterious multiplier” which may be modified at the
discretion of the board.
An overall performance rating for the Company is approved by the Remuneration
Committee, with assessment of performance against KPIs conducted following the
finalisation of the full year audited results. The individual performance of the Managing
Director is also rated and considered when determining the amount, if any, of the STI
component to be paid at the award end. The Board’s has discretion over payments to suit
the circumstances of the event(s).
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 15 of 66
Remuneration Report (Audited)
Variable Remuneration – Long Term Incentive Plan
Performance rights were granted to executives with hurdles that apply as follows for FY21:
(1) 75% of the LTIP grant is subject to an Earnings Per Share (EPS) hurdle; and
(2) 25% of the LTIP grant is subject to a Total Shareholder Return (TSR) hurdle.
The use of two performance hurdles was consistent with market practice at the time.
For FY21 the performance hurdles were amended to reflect an equal weighting against Full Year FY2023 Revenue and Full
Year FY2023 EBITDA (both tested at the end of FY23). The Remuneration Committee and Board considered that as a result
of the general economic uncertainty surrounding the impacts of the COVID-19 pandemic, a reduced timeframe of 2 years
and performance hurdles relating to internal financial measurements under the control of the executive provided a more
appropriate reward and retention mechanism.
The hurdles motivate executives with a clear line of sight to strategic outcomes outcome through the performance hurdle
measurements.
When expectations are met, and all other things being equal, the LTIP is intended to vest and deliver the appropriate level
of remuneration and market positioning.
In total, the Company granted 3,301,887 performance rights to the Managing Director for FY21 which was approved by
shareholders at the Company Annual General Meeting in October 2020.
The structure and details of LTIP Performance Rights issued to executives in FY21 and proposed for FY22 under the plan
are summarised in the following table:
Long Term Equity Incentive Plan (LTIP)
Aspect
Purpose
Participation
Plan, Offers and Comments
The LTIP’s purpose is to align executive interests with those of shareholders by linking
reward to sustainable value creation for shareholders and to assist in the attraction and
retention of a stable focused Managing Director and leadership team.
Grants are made to those executives and key employees that are able to influence the
generation of shareholders’ wealth and thus have a direct impact on the Company’s
performance against the relevant long-term performance hurdle. NEDs are not eligible to
participate in the LTIP.
Nature
Each LTIP Performance Right entitles the participant to one share in the Company upon
vesting.
Grant Frequency
Annual grant and ad-hoc on commencement of employment and future potential grants.
Delivery
Value / Number
Key Performance
indicators, weightings
and performance goals
LTI’s are delivered under the Company’s Employee Incentive Plan (EIP). The EIP enables
the Company to offer Executive Directors and key employees (Eligible Participants) a range
of different employee incentive scheme (ESS) interests with the aim of attracting, motivating
and retaining key management. These ESS interests or awards include options,
performance rights, service rights, deferred shares, exempt shares, cash rights and stock
appreciation rights.
Awards under the LTI plan are made in the form of Performance Rights which provide, when
vested, one share at nil cost (provided the specified performance hurdle is met). No
dividends are paid on unvested LTI awards. A new share will be issued for each vested
Performance Right. The number of Performance Rights allocated for each Eligible
Participant is calculated by reference to their maximum LTI opportunity value.
Allocations are made based on a face value approach using the Volume Weighted Average
Price of Spectur’s shares over a specified period prior to the award date. This fixes the
maximum number of shares / rights and the actual number will vest in accordance with the
performance conditions which are set.
The hurdles and relative weightings applying to LTI grants issued in the respective
periods are as follows:
FY21
➢ 75% EPS in FY2022 (tested at the end of the 2-year period).
➢ 25% Share price growth over a 2-year period ‘Total Shareholder Return’ (TSR)
tested at the end of FY2022
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 16 of 66
Remuneration Report (Audited)
Cessation of employment
during measurement
period
Change of Control
Plan gate and discretion
FY22
➢ 50% Full Year FY2023 Revenue (tested at the end of FY23).
➢ 50% Full Year FY2023 EBITDA (tested at the end of FY23).
If cessation of employment occurs, the following treatment will apply in respect of unvested
rights:
•
•
If the participant ceases employment with Spectur on resignation or on termination
for cause, unvested Performance Rights will normally be forfeited.
If the participant ceases employment in other circumstances (for example, due to
illness, total or permanent disablement, retirement, redundancy, end of contract
or other circumstances determined by the Board), unvested rights will stay ‘on
foot’ and may vest at the end of the original performance period to the extent
performance conditions are met.
The Board may determine in its discretion that the number of rights available to vest will be
reduced pro-rata for time at the date employment ceases.
The Board will retain discretion to allow for accelerated vesting (pro-rated for performance
and/or time) in special circumstances (as opposed to allowing unvested rights to remain ‘on
foot’ on cessation of employment).
Unless the Board determines otherwise, a pro-rata number of the participant’s unvested
rights will vest based on the proportion of the performance period that has passed at the
time of the change of control.
Vesting may also be subject to the achievement of pro-rata performance conditions at the
time of the change of control.
Safety performance as a “deleterious multiplier” which may be modified at the Board’s
discretion to suit the circumstances of the event(s). The Board retains discretion to
modify outcomes to ensure that the LTIP does not produce outcomes that shareholders
would be likely to consider inappropriate.
F. Performance and remuneration outcomes for FY21
Remuneration Consultants
The Remuneration and Nomination Committee may use independent Remuneration Consultants to provide advice but
elected not to do so for FY21.
Remuneration Policy vs Financial Performance
The Company does not currently have a policy with respect to the payment of dividends and returns of capital however this
will be reviewed on an annual basis.
FY21 short term remuneration incentives were linked to financial performance via Revenue and EBITDA measurement and
product development initiatives. Longer term incentives are linked to EPS and TSR targets.
The earnings of the Company for the previous five financial years are summarised below:
2021
$
2020
$
2019
$
2018
$
2017
$
Revenue
5,248,882
4,801,655
4,818,130
2,476,501
1,332,681
EBITDA loss
(1,755,415)
(1,452,264)
(2,586,997)
(3,764,137)
(607,237)
Adjusted EBITDA loss1
Earnings / (Loss) Per
Share (cents per share)
(1,736,321)
(1,474,251)
(2,282,948)
(2,471,633)
(578,737)
(1.70)
(2.25)
(4.82)
(7.61)
Product Development
Beach Warning
System
STA6
Shark Warning,
mobile systems
HD5
Thermal camera
(3.31)
Cloud
Management
platform
1 Adjusted EBITDA is adjusted for share-based compensation, one off income / expenses (including COVID-19 relief),
impairments, write downs, one off gains / losses and non-cash expenses.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 17 of 66
Remuneration Report (Audited)
G. Non-Executive Director Remuneration During the Reporting Period
Remuneration Policy
In accordance with best practice corporate governance, the structure of Non-Executive Director (NED) and executive
remuneration is separate and distinct.
The overall level of annual NED fees was approved by shareholders in accordance with the requirements of the Company’s
Constitution and the Corporations Act. The maximum aggregate pool of Directors’ fees payable to all of the Company’s
NEDs is $250,000 per annum. This aggregate amount was approved by shareholders at the 2017 Annual General Meeting.
Equity Compensation
In accordance with Australian practice the Company’s policy was not to grant any incentive equity-based compensation to
NEDs. This policy was revised in FY22 following a change in circumstances related to COVID-19 impacting the business:
•
•
•
•
•
NED’s took a 20% salary reduction during Q4 FY20 and Q1FY21 (a total of approx. 6 months), and revised to a
10% reduction for Q2FY21 in alignment with Company policy implemented during the COVID-19 pandemic to limit
overhead expenses.
NED’s were paid via shares in lieu of remaining salary for Q4FY20, escrowed for 12 months.
NED fees have remained static (for Bilyana Smith through FY20, 21 and now FY22), Darren Cooper FY19-22.
In the interests of cash preservation for the Company, and retaining the talent pool of directors, 500,000 unquoted
options were awarded to each of the NED’s (July 2021) as a reward for their commitment and retention.
The options have no vesting conditions, expire 30 June 2024, and will be exercisable at a 42% premium to
Spectur’s share price at the time of grant, and are subject to approval by shareholders at Spectur’s 2021 AGM.
An expense of $73,938 was recognised in FY21 in relation to these.
Accordingly, no other equity incentives were offered to NEDs in the reporting period to 30 June 2021. Shares were issued
to Darren Cooper and Bilyana Smith during the year in lieu of their reduced Board fees for Q4FY20. These were approved
by Spectur shareholders at the 2020 Annual General Meeting.
Remuneration Structure
NEDs receive a fixed remuneration of base fees, presently set at $40,000 per annum plus statutory superannuation. These
fees cover the board activities and membership of any relevant committees. In addition to these fees, NEDs are entitled to
reimbursement of reasonable travel, accommodation and other expenses incurred in attending meetings of the Board,
committee or shareholder meetings whilst engaged by Spectur. NEDs do not earn retirement benefits other than
superannuation and are not entitled to any compensation on termination of their directorships.
All NED fees remain unchanged until further notice and pending review of market conditions and Company performance.
The current Board fee structure which includes committee fees for NEDs is as per the table below:
NED Fees
Chair
$75,000
Member
$40,000
NEDs remuneration is not linked to the performance of the Company; however, to align directors’ interests with shareholder
interests, the directors may hold shares in the Company as governed by the Company’s Securities Trading Policy.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 18 of 66
Remuneration Report (Audited)
H.
Director and Executive Service Agreements and Remuneration
As of the date of this report, remuneration and other terms of employment of Directors and Other Key Management
Personnel are formalised in employment contracts and service agreements. The major provisions of the agreements related
to remuneration are set out below.
Base Salary/
Fee per annum
Terms of Agreement
Notice Period
Executive Directors (i)
$260,000 per annum for year 1,
$280,000 per annum for year 2,
$300,000 per annum for year 3.
And STI and LTI component
included and detailed above.
Gerard Dyson
Non-Executive Directors (i)
Darren Cooper
$75,000
Bilyana Smith
$40,000
Executive Service
Agreement -
Commencement date –
1 July 2019
3 months in writing by either
party.
The parties mutually agreed to
amend the contract from a fixed
term to a rolling contract with a
3-month notice period.
Non-Executive Director
contract
Commencement date – 5
October 2018
Non-Executive Director
contract
Commencement date –1
October 2019
Upon written advice of intention
or in accordance with the
Constitution of the Company or
the Corporations Act 2001
Upon written advice of intention
or in accordance with the
Constitution of the Company or
the Corporations Act 2001
(i)
Board fees including the MD’s remuneration were reduced by 20% for Q1FY21 and 10% for Q2FY21, and reinstated
in full from 1 January 2021.
Any salary reviews for the NED’s have been placed on hold pending a review of market conditions.
Details of the nature and amount of each element of the emoluments received by or payable to each of the Key Management
Personnel (KMP) of Spectur Limited for the financial years specified are as follows:
FY2021
Directors
Darren Cooper (i) (iv)
Bilyana Smith (ii) (iv)
Key Management Personnel
Gerard Dyson (iii) (iv)
Total
Short-term benefits
Salary &
fees
$
Bonus
Payments
$
Super-
annuation
$
Share-based
payments(iii)
$
69,375
37,000
255,584
361,959
-
-
-
6,769
3,609
24,280
34,658
17,604
17,604
54,461
89,669
Percentage
performance
related
%
-
-
16%
Total
$
93,748
58,213
334,325
486,286
Notes:
(i)
Darren Cooper elected to receive at 20% reduction in NED fees for Q1FY21 and a 10% reduction for Q2FY21, in alignment with
Company policy implemented during the COVID-19 pandemic to limit overhead expenses.
(ii) Bilyana Smith elected to receive at 20% reduction in NED fees for Q1FY21 and a 10% reduction for Q2FY21 in alignment with
Company policy implemented during the COVID-19 pandemic to limit overhead expenses.
(iii) The share-based payments related to the value of Long Terms Incentive Performance Rights which were issued to Gerard Dyson
following shareholder approval at the 2020 AGM. In accordance with AASB 2, the performance rights issued to the Managing
Director have been valued based on factors such as the underlying share price, the expected vesting date and vesting probability
in achieving the specified vesting hurdles at the reporting date (Note 26). It should be noted that Dr Dyson has not received this
amount and the performance rights may have no actual financial value unless the required performance hurdles are achieved.
Stock may also be issued to the recipient at a share issue price lower or higher than valued and recognised in the financial report.
(iv) The issue of the Performance Rights and/or options is conditional on the receipt of shareholder approval which is to be sought at
the Company’s 2021 Annual General Meeting (AGM)
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 19 of 66
Remuneration Report (Audited)
H.
Director and Executive Service Agreements and Remuneration (continued)
FY2020
Directors
Darren Cooper (i)
Bilyana Smith (ii)
Stephen Bodeker (iv)
Andrew Hagen (v)
Key Management Personnel
Gerard Dyson
Total
Short-term benefits
Salary &
fees
$
Bonus
Payments
$
Super-
annuation
$
Share-based
payments(iii)
$
72,333
28,578
38,781
11,667
-
-
-
-
6,871
2,715
-
1,108
-
-
-
-
Total
$
79,204
31,293
38,781
12,775
252,000
403,359
65,500
65,500
23,940
34,634
7,812
7,812
349,252
511,305
Percentage
performance
related
%
-
-
-
-
21%
Notes:
(i)
Darren Cooper elected to receive the equivalent of $16,083 of his fees in fully paid ordinary shares, in lieu of the cash component.
The equity consideration was subject to shareholder approval. In addition, $8,769 was reimbursed for travel and expenses outside
of directors’ fees.
(ii) Appointed 1 October 2019. Bilyana Smith elected to receive the equivalent of $8,578 of her fees in fully paid ordinary shares, in
lieu of the cash component. The equity consideration was subject to shareholder approval. In addition, $6,348 was reimbursed for
travel and expenses outside of directors fees.
(iii) The share-based payments related to the value of Long Terms Incentive Performance Rights which were issued to Gerard Dyson
following shareholder approval at the 2019 AGM. In accordance with AASB 2, the performance rights issued to the Managing
Director have been valued based on factors such as the underlying share price, the expected vesting date and vesting probability
in achieving the specified vesting hurdles at the reporting date.
It should be noted that Dr Dyson has not received this amount and the performance rights may have no actual financial value unless
the required performance hurdles are achieved. Stock may also be issued to the recipient at a share issue price lower or higher
than valued and recognised in the financial report.
(iv) Resigned 31 May 2020.
(v) Mr Hagen retired by rotation at the Company’s AGM on 22 October 2019.
I.
Additional statutory disclosures
Key Management Personnel Equity Holdings
Fully paid ordinary shares
FY21
30 June 2021
Directors
Darren Cooper1
Bilyana Smith2
Executives
Gerard Dyson3
Balance at
beginning of
year
Number
Granted in lieu
of cash
compensation
Number
Received on
exercise of
PRs
Number
Purchased
during year
Number
Balance at
resignation
Number
Balance held
at year end
Number
1,500,000
200,000
273,253
145,735
1,058,300
-
-
-
-
730,626
403,879
403,879
-
-
-
2,503,879
749,614
1,462,179
1 Darren Cooper acquired 326,747 Spectur shares on market and a further 403,879 shares were acquired pursuant to Spectur’s Share
Purchase Plan in July 2020. 273,253 shares were paid to Darren Cooper in lieu of cash consideration for salaries forgone Q4FY20. As at
30 June 2021, 1,903,879 shares were held in the Cooper Retirement Pty Ltd , of which Mr Cooper is
the beneficiary, and 600,000 shares were directly held.
2 145,735 shares were paid to Bilyana Smith, in lieu of cash consideration for salaries forgone Q4FY20. This was approved at Spectur’s
Annual General Meeting in October 2020. A further 403,879 shares were acquired pursuant to Spectur’s Share Purchase Plan in July 2020.
3 403,879 of shares were acquired pursuant to Spectur’s Share Purchase Plan in July 2020. Dr Dysons shares are held in a family trust,
with Gerard John Dyson and Chantel Yvette Dyson as trustees of the family trust.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 20 of 66
Remuneration Report (Audited)
Key Management Personnel equity holdings (Continued)
Fully paid ordinary shares
FY20
30 June 2020
Directors
Darren Cooper1
Bilyana Smith2
Stephen Bodeker3
Andrew Hagen4
Executives
Gerard Dyson5
Balance at
beginning of
year / on
appointment
Number
Granted in lieu
of cash
compensation
Number
Received on
exercise of
PRs
Number
Purchased
during year
Number
Balance at
resignation
Number
Balance held
at year end
Number
355,602
-
113,424
25,000
192,307
-
-
-
-
-
-
-
-
1,144,398
200,000
250,000
-
-
-
363,424
25,000
1,500,000
200,000
-
-
865,993
-
1,058,300
1 750,000 Shares acquired on/off market. 394,398 Shares issued pursuant to placement subscription, issued 21 August 2019.
2 Appointed 1 October 2019.
3 Shares acquired via off market transfer– 24 March 2020. Resigned 31 May 2020.
4 Resigned 29 October 2019.
5 558,300 Shares acquired on market. 307,693 Shares issued pursuant to placement subscription, issued 21 August 2019.
Share options
Share options granted to KMP
During the financial year there were no options granted to KMP’s of the Company and the entities they controlled as part of
their remuneration.
FY21
30 June 2021
Directors
Darren Cooper
Bilyana Smith
Executives
Gerard Dyson
Balance at
beginning of
year
Number
150,000
-
-
Granted as
compensation
Number
Exercised
Number
Expired
unexercised
Number
Balance at end
of year
Number
-
-
-
-
-
-
(150,000)
-
-
-
-
-
1 150,000 options exercisable at $0.20 on or before 31 December 2020 expired unexercised.
FY20
30 June 2020
Directors
Darren Cooper
Bilyana Smith1
Stephen Bodeker2
Andrew Hagen3
Executives
Gerard Dyson
1 Appointed 1 October 2019.
2 Resigned 31 May 2020
3 Resigned 29 October 2019.
Balance at
beginning of
year/ on
appointment
Number
150,000
252,875
500,000
-
Granted as
compensation
Number
Exercised
Number
Net change
other
Number
Balance at end
of year / on
resignation
Number
-
-
-
-
-
-
-
-
-
-
-
-
150,000
252,875
500,000
-
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 21 of 66
Remuneration Report (Audited)
Key Management Personnel equity holdings (Continued)
Performance Rights
During the year Performance Rights were granted to G Dyson as part of the Company’s LTI plan.
FY21
30 June 2021
Directors
Gerard Dyson
FY20
30 June 2020
Directors
Gerard Dyson
Balance at
beginning of
year
Issued during
the year
Cancelled /
forfeited
during the
year
Balance at end
of year
Number
Number
Number
Number
Vested and
Exercisable
Number
1,607,919
3,301,887
-
4,909,806
-
Balance at
beginning of
year
Issued during
the year
Cancelled /
forfeited
during the
year
Balance at end
of year
Number
Number
Number
Number
Vested and
Exercisable
Number
-
1,607,919
-
1,607,919
-
Performance Rights
For details of the employee share option plan and of Performance Rights granted during FY20, please refer to Notes 9 and
26. All share options issued to KMP were made in accordance with the provisions of the Spectur EIP.
Comments on Remuneration Report at Spectur’s most recent AGM
The Company received a 90.5% of “yes” votes on its remuneration report for the 2020 financial year. The Company did not
receive any specific feedback from shareholders at the 2020 Annual General Meeting on its remuneration practices.
Signed in accordance with a resolution of the directors.
Mr Darren John Cooper
Director
Dated this 30 August 2021
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 22 of 66
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the financial report of Spectur Limited for the year ended 30 June
2021, I declare that to the best of my knowledge and belief, there have been no contraventions
of:
a)
the auditor independence requirements of the Corporations Act 2001 in relation to the
audit; and
b)
any applicable code of professional conduct in relation to the audit.
Perth, Western Australia
30 August 2021
L Di Giallonardo
Partner
Page 23 of 66
Statement of Profit or Loss and Other Comprehensive Income
For the Year Ended 30 June 2021
Notes
30 June 2021
30 June 2020
$
$
Continuing Operations
Revenue
Cost of sales
Gross profit
Interest income
COVID 19 relief
(Loss) / profit on disposal of property, plant and equipment
Depreciation and amortisation
Employee benefits
Finance charges
General and administrative expenses
Impairment of intangible assets
Inventories written back / (off)
Marketing and advertising
Property expenses – lease payments for short term leases
Research and development expenses
Share-based payment expense
Loss before income tax benefit
Income tax benefit
Loss for the year
Other comprehensive loss for the year
Total comprehensive loss for the year
5
6
16
26
7
5,248,882
(2,108,881)
3,140,001
1,646
393,989
(1,674)
(317,198)
(3,573,765)
(16,528)
(935,555)
(12,640)
4,919
(310,567)
(107,757)
(182,477)
(167,342)
(2,084,948)
329,533
(1,755,415)
-
4,801,655
(1,727,751)
3,073,904
14,626
333,428
(45,931)
(392,773)
(3,015,247)
(23,413)
(925,479)
(74,006)
(173,471)
(235,318)
(225,991)
(146,120)
(18,033)
(1,853,824)
231,126
(1,622,698)
-
(1,755,415)
(1,622,698)
Loss attributable to members of the Company
(1,755,415)
(1,622,698)
Basic and diluted loss per share (cents per share)
10
(1.70)
(2.25)
The accompanying notes form part of these financial statements.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 24 of 66
Statement of Financial Position
At 30 June 2021
Assets
Current Assets
Cash and cash equivalents
Trade and other receivables
Inventories
Total Current Assets
Non-Current Assets
Property, plant and equipment
Other receivables
Investments accounted for using the equity method
Intangible assets
Right-of-use assets
Total Non-Current Assets
Total Assets
Liabilities
Current Liabilities
Trade and other payables
Employee Benefits
Borrowings
Lease liabilities
Provisions
Total Current Liabilities
Non-Current Liabilities
Borrowings
Lease liabilities
Employee benefits
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Net Equity
Notes
30 June 2021
30 June 2020
$
$
11
12
13
14
15
16
17
18
19
20
21
22
20
21
19
8
9
1,688,712
1,264,594
774,913
3,728,219
541,521
30,114
9,985
179,589
320,288
1,081,497
4,809,716
1,340,866
463,529
60,513
158,310
114,299
1,632,513
691,424
493,430
2,817,367
621,848
52,057
-
309,773
278,030
1,261,708
4,079,075
806,063
214,340
32,975
100,534
88,830
2,137,517
1,242,742
-
169,453
67,324
236,777
2,374,294
2,435,422
12,573,174
177,772
(10,315,524)
2,435,422
60,513
180,537
60,117
301,167
1,543,909
2,535,166
11,084,845
504,479
(9,054,158)
2,535,166
The accompanying notes form part of these financial statements.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 25 of 66
Statement of Changes in Equity
For the Year Ended 30 June 2021
Issued
Capital
$
Reserves Accumulated
Losses
Total Equity
$
$
$
Balance at 1 July 2020
11,084,845
504,479
(9,054,158)
2,535,166
Loss after income tax for the year
Total Comprehensive loss for the year
Shares issued during the year
Share issue costs
Value of expired options transferred to
accumulated losses
Options issued during the year
Value of Performance Rights brought to
account during the year
-
-
1,537,322
(48,993)
-
-
-
-
(1,755,415)
(1,755,415)
(1,755,415)
(1,755,415)
-
-
1,537,322
(48,993)
-
-
-
(494,049)
151,396
15,946
494,049
-
-
-
151,396
15,946
Balance as at 30 June 2021
12,573,174
177,772
(10,315,524)
2,435,422
Issued
Capital
$
Reserves Accumulated
Losses
Total Equity
$
$
$
Balance at 1 July 2019
8,997,115
1,108,668
(7,431,460)
2,674,323
Loss after income tax for the year
Total Comprehensive loss for the year
Shares issued during the year
Share issue costs
-
-
1,590,000
(202,270)
-
-
-
-
Performance rights converted during the year
700,000
(700,000)
Options issued during the year
Value of Performance Rights brought to
account during the year
-
-
107,541
(11,730)
(1,622,698)
(1,622,698)
(1,622,698)
(1,622,698)
-
-
-
-
-
1,590,000
(202,270)
-
107,541
(11,730)
Balance as at 30 June 2020
11,084,845
504,479
(9,054,158)
2,535,166
The accompanying notes form part of these financial statements.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 26 of 66
Statement of Cash Flows
For the Year Ended 30 June 2021
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Interest paid
Finance and related charges
COVID 19 relief
R & D tax incentives received
Notes
30 June 2021
30 June 2020
$
$
5,408,095
(7,162,964)
1,734
(12,102)
(4,425)
531,673
274,185
5,128,663
(6,098,773)
15,057
(15,793)
(7,620)
195,744
331,533
Net cash used in operating activities
11.1
(963,804)
(451,189)
Cash flows from investing activities
Payments for loans to joint venture
Payments to acquire investments
Payments for intangible assets
Purchase of property, plant and equipment
Net cash used in investing activities
Cash flow from financing activities
Proceeds from issue and subscription of shares
Payments for share issue costs
Repayment of lease liabilities
Repayment of borrowings
Net cash from financing activities
(7,489)
(9,985)
-
(281,478)
(298,952)
1,512,661
(48,993)
(111,738)
(32,975)
1,318,955
-
-
(47,162)
(288,331)
(335,493)
1,407,399
(124,491)
(98,677)
(68,297)
1,115,934
Net increase in cash and cash equivalents held
Cash and cash equivalents at the beginning of the
year
Cash and cash equivalents at the end of the year
56,199
329,252
1,632,513
1,688,712
1,303,261
1,632,513
The accompanying notes form part of these financial statements.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 27 of 66
Note 1: Basis of Preparation
These financial statements are general purpose financial statements, which have been prepared in accordance with the
requirements of the Corporations Act 2001, Accounting Standards and Interpretations and comply with other requirements
of the law.
For the purposes of preparing the financial statements, the Company is a for-profit entity.
The accounting policies detailed below have been consistently applied to all the years presented unless otherwise stated.
The financial statements for Spectur Limited (Spectur) or (Company). Spectur Limited holds a 51% interest in Spectur
New Zealand Ltd. The investment in Spectur NZ is accounted for using the equity method in accordance with AASB 128.
The financial statements have been prepared on a historical cost basis. Historical cost is based on the fair values of the
consideration given in exchange for goods and services.
The financial statements are presented in Australian dollars.
Spectur is listed on the Australian Securities Exchange (ASX), is a public company, incorporated and operating in Australia.
The entity’s principal activities are detailed in the Directors’ Report.
(a)
Statement of compliance
The financial report was authorised for issue on 30 August 2021.
The financial report complies with Australian Accounting Standards, which include Australian equivalents to International
Financial Reporting Standards (AIFRS). Compliance with AIFRS ensures that the financial report, comprising the financial
statements and notes thereto, complies with International Financial Reporting Standards (IFRS).
(b)
Adoption of New and Revised Standards
New Standards and Interpretations applicable for the year ended 30 June 2021
For the year ended 30 June 2021, the Directors have reviewed all of the new and revised Standards and Interpretations
issued by the AASB that are relevant to the Company and effective for the current reporting period. As a result of this
review the Directors have determined that there is no material impact of the new and revised Standards and Interpretations
on the Company, and therefore no change is necessary to accounting policies.
New Standards and Interpretations in issue not yet adopted
The Directors have also reviewed all of the new and revised Standards and Interpretations in issue not yet adopted for the
year ended 30 June 2021. As a result of this review the Directors have determined that there is no material impact of the
Standards and Interpretations in issue not yet adopted on the Company and, therefore, no change is necessary to
accounting policies.
(c)
Going Concern
The financial report has been prepared on the going concern basis, which contemplates continuity of normal business
activities and the realisation of assets and settlement of liabilities in the ordinary course of business.
(d)
Foreign currency translation
The functional and presentation currency of Spectur Limited is Australian dollars.
Transactions in foreign currencies are initially recorded in the functional currency by applying the exchange rates ruling at
the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate
of exchange ruling at the balance date.
All exchange differences in the financial report are taken to profit or loss with the exception of differences on foreign
currency borrowings that provide a hedge against a net investment in a foreign entity. These are taken directly to equity
until the disposal of the net investment, at which time they are recognised in profit or loss.
Tax charges and credits attributable to exchange differences on those borrowings are also recognised in equity.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange
rate as at the date of the initial transaction.
Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when
the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of
the fair value gain or loss.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 28 of 66
Note 1: Basis of Preparation
(e)
Investment in associates and joint ventures
Investments in associates and joint ventures are accounted for using the equity method. The carrying amount of the
investment in associates and joint ventures is increased or decreased to recognise the Company’s share of the profit or
loss and other comprehensive income of the associate and joint venture, adjusted where necessary to ensure consistency
with the accounting policies of the Company.
Unrealised gains and losses on transactions between the Company and its associates and joint ventures are eliminated to
the extent of the Company’s interest in those entities. Where unrealised losses are eliminated, the underlying asset is also
tested for impairment.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 29 of 66
Note 2: Significant Accounting Policies
(a)
Revenue recognition
Revenue from contracts with customers
Revenue is recognised at an amount that reflects the consideration to which the Company, is expected to be entitled in
exchange for transferring goods or services to a customer.
For each contract with a customer, the Company:
•
•
•
•
•
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 based on 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.
Sale of goods
Revenue from the sale of goods is recognised at the point in time when the customer obtains control of the goods, which
is generally at the time of delivery.
Rendering of service
Revenue from a contract to provide services is recognised over time as the services are rendered based on either a fixed
price or an hourly rate.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
(b)
Other Income and Expenses
Dividends
Dividends are recognised as revenue when the right to receive payment is established. This applies even if they are paid
out of pre-acquisition profits. However, the investment may need to be tested for impairment as a consequence.
Interest income
Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the Company
and the amount of revenue can be reliably measured. Interest income is accrued on a time basis, by reference to the
principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future
cash receipts through the expected life of the financial asset to that assets’ net carrying amount on initial recognition.
Borrowing costs
Borrowing costs are capitalised that are directly attributable to the acquisition, construction or production of qualifying
assets where the borrowing cost is added to the cost of those assets until such time as the assets are substantially ready
for their intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying
assets is deducted from the borrowing costs eligible for capitalisation.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 30 of 66
Note 2: Significant Accounting Policies
(c)
Income Tax Expenses
The income tax expense or benefit for the period is the tax payable on the current period’s taxable income based on the
applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to
temporary difference and to unused tax losses.
The current income tax charge is calculated based on the tax laws enacted or substantively enacted at the end of the
reporting period in the countries where the Company operates and generates taxable income. Management periodically
evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to
interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax
authorities.
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered
from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted
or substantively enacted by the balance date.
Deferred income tax is provided on all temporary differences at the balance date between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
when the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not a
business combination and that, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss;
or when the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint
ventures, and the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary
difference will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets
and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences and the carry-forward of unused tax credits and unused tax losses can be utilised, except:
• when the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition
of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects
neither the accounting profit nor taxable profit or loss; or
• when the deductible temporary difference is associated with investments in subsidiaries, associates or interests in
joint ventures, in which case a deferred tax asset is only recognised to the extent that it is probable that the temporary
difference will reverse in the foreseeable future and taxable profit will be available against which the temporary
difference can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance date and reduced to the extent that it is
no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be
utilised.
Unrecognised deferred income tax assets are reassessed at each balance date and are recognised to the extent that it
has become probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the
asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted
at the balance date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets
against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same
taxation authority.
Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
• when the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which
case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable;
and
receivables and payables, which are stated with the amount of GST included.
•
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables
in the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis and the GST component of cash flows arising from
investing and financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating
cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation
authority.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 31 of 66
Note 2: Significant Accounting Policies
(d)
Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating
Decision Maker. The Chief Operating Decision Maker, who is responsible for allocating resources and assessing
performance of the operating segments, has been identified as the Managing Director of Spectur Limited.
(e)
Cash and Cash Equivalents
Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments that are readily
convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
Bank overdrafts are shown within borrowings as current liabilities in the statement of financial position. For the purposes
of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents as defined above, net of
outstanding bank overdrafts.
(f)
Trade and Other Receivables
Trade receivables are measured on initial recognition at fair value and are subsequently measured at amortised cost using
the effective interest rate method, less any allowance for impairment. Trade receivables are generally due for settlement
within periods ranging from 30 days to 60 days.
Impairment of trade receivables is continually reviewed and those that are considered to be uncollectible are written off by
reducing the carrying amount directly. An allowance account is used when there is objective evidence that the Company
will not be able to collect all amounts due according to the original contractual terms. Factors considered by the Company
in making this determination include known significant financial difficulties of the debtor, review of financial information and
significant delinquency in making contractual payments to the Company. The impairment allowance is set equal to the
difference between the carrying amount of the receivable and the present value of estimated future cash flows, discounted
at the original effective interest rate. Where receivables are short-term, discounting is not applied in determining the
allowance.
The amount of the impairment loss is recognised in the statement of profit or loss and other comprehensive income within
other expenses. When a trade receivable for which an impairment allowance had been recognised becomes uncollectible
in a subsequent period, it is written off against the allowance account. Subsequent recoveries of amounts previously written
off are credited against other expenses in the statement of profit or loss and other comprehensive income.
(g)
Inventories
Inventories are valued at the lower of cost and net realisable value.
Costs incurred in bringing each product to its present location and condition is accounted for as follows:
• Raw materials – purchase cost on a first-in, first-out basis; and
•
Finished goods and work-in-progress – cost of direct materials and labour and a proportion of manufacturing
overheads based on normal operating capacity but excluding borrowing costs.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion
and the estimated costs necessary to make the sale.
(h)
Property, plant and equipment
Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses. Such cost
includes the cost of replacing parts that are eligible for capitalisation when the cost of replacing the parts is incurred.
Similarly, when each major inspection is performed, its cost is recognised in the carrying amount of the plant and
equipment as a replacement only if it is eligible for capitalisation.
Depreciation is calculated on diminishing value basis using the following rates:
Motor vehicle
Plant equipment
Office equipment
Camera equipment
25%
10% to 50%
10% to 50%
33.33%
The assets' residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at each
financial year end.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 32 of 66
Note 2: Significant Accounting Policies
Property, plant and equipment (continued)
(h)
Impairment
The carrying values of plant and equipment are reviewed for impairment at each reporting date, with recoverable amount
being estimated when events or changes in circumstances indicate that the carrying value may be impaired. The
recoverable amount of plant and equipment is the higher of fair value less costs to sell and value in use. In assessing value
in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset. For an asset that does not
generate largely independent cash inflows, recoverable amount is determined for the cash-generating unit to which the
asset belongs, unless the asset's value in use can be estimated to approximate fair value. An impairment exists when the
carrying value of an asset or cash-generating unit exceeds its estimated recoverable amount.
The asset or cash-generating unit is then written down to its recoverable amount. For plant and equipment, impairment
losses are recognised in the statement of comprehensive income in the cost of sales line item. However, because land and
buildings are measured at revalued amounts, impairment losses on land and buildings are treated as a revaluation
decrement.
Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are
expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference
between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the year the asset
is derecognised.
(i)
Intangible assets
Intangible assets acquired separately
Intangible assets acquired separately are recorded at cost less accumulated amortisation and impairment. Amortisation is
charged on a straight-line basis over their estimated useful lives. The estimated useful life and amortisation method is
reviewed at the end of each annual reporting period, with any changes in these accounting estimates being accounted for
on a prospective basis.
Internally generated intangible assets – research and development expenditure
Expenditure on research activities is recognised as an expense in the period in which it is incurred. Where no internally
generated intangible asset can be recognised, development expenditure is recognised as an expense in the period as
incurred.
An intangible asset arising from development (or from the development phase of an internal project) is recognised if, and
only if, all of the following have been demonstrated:
•
•
•
• How the intangible asset will generate probable future economic benefits;
•
The technical feasibility of completing the intangible asset so that it will be available for use or sale;
The intention to complete the intangible asset and use or sell it;
The ability to use or sell the intangible asset;
The availability of adequate technical, financial and other resources to complete development and to use or sell the
intangible asset; and
The ability to measure reliably the expenditure attributable to the intangible asset during its development.
•
The amount initially recognised for internally generated intangible assets is the sum of the expenditure incurred from the
date when the intangible asset first meets the recognition criteria listed above. Subsequent to initial recognition, internally
generated intangible assets are reported at cost less accumulated amortisation and accumulated impairment losses, on
the same basis as intangible assets acquired separately.
The following useful lives are used in the calculation of amortisation:
Patents
Trademarks
Other Intangibles
Product development
8 years following grant of patent
10 years following grant of trademark
3 years following acquisition
3 to 5 years following commercial use
Impairment of tangible and intangible assets other than Other Intangibles
The Company assesses at each balance date whether there is an indication that an asset may be impaired. If any such
indication exists, or when annual impairment testing for an asset is required, the Company makes an estimate of the asset’s
recoverable amount. An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use and
is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those
from other assets or group of assets and the asset's value in use cannot be estimated to be close to its fair value.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 33 of 66
Note 2: Significant Accounting Policies
(j)
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 Company 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 Company 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.
(k)
Trade and other payables
Trade and other payables
Trade payables and other payables are carried at amortised cost and represent liabilities for goods and services provided
to the Company prior to the end of the financial year that are unpaid and arise when the Company becomes obliged to
make future payments in respect of the purchase of these goods and services. Trade and other payables are presented
as current liabilities unless payment is not due within 12 months.
(l)
Employee benefits
Liabilities accruing to employees in respect of wages and salaries, annual leave, long service leave and sick leave expected
to be settled within 12 months of the balance date are recognised in employee benefits in respect of employees’ services
up to the balance date. They are measured at the amounts expected to be paid when the liabilities are settled. Liabilities
for non-accumulating sick leave are recognised when the leave is taken and are measured at the rates paid or payable.
Liabilities accruing to employees in respect of wages and salaries, annual leave, long service leave and sick leave not
expected to be settled within 12 months of the balance date are recognised in non-current employee benefits in respect
of employees’ services up to the balance date. They are measured as the present value of the estimated future outflows
to be made by the Company.
The liability for long service leave is recognised in employee benefits and measured as the present value of expected
future payments to be made in respect of services provided by employees up to the balance date. Consideration is given
to expected future wage and salary levels, experience of employee departures, and period of service. Expected future
payments are discounted using market yields at the balance date on national government bonds with terms to maturity
and currencies that match, as closely as possible, the estimated future cash outflows.
(m)
Contract liabilities
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received
consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the
Company transfers goods or services to the customer, a contract liability is recognised when the payment is made or the
payment is due (whichever is earlier). Contract liabilities are recognised as revenue when the Company performs under
the contract.
(n)
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 Company'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.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 34 of 66
Note 2: Significant Accounting Policies
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.
(o)
Provisions
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it
is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation. Provisions are not recognised for future operating losses.
When the Company expects some or all of a provision to be reimbursed, for example under an insurance contract, the
reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense
relating to any provision is presented in the statement of profit or loss and other comprehensive income net of any
reimbursement.
Provisions are measured at the present value or management’s best estimate of the expenditure required to settle the
present obligation at the end of the reporting period. If the effect of the time value of money is material, provisions are
discounted using a current pre-tax rate that reflects the risks specific to the liability. When discounting is used, the increase
in the provision due to the passage of time is recognised as an interest expense.
Onerous contracts
Present obligations arising under onerous contracts are recognised and measured as provisions. An onerous contract is
considered to exist where the Company has a contract under which the unavoidable costs of meeting the obligations under
the contract exceed the economic benefits expected to be received from the contract.
Warranties
Provisions for the expected cost of warranty obligations under local sale of goods legislation are recognised at the date of
sale of the relevant products, at the Directors’ best estimate of the expenditure required to settle the Company’s obligation.
(p)
Share-based payment transactions
Equity settled transactions
The Company provides benefits to employees (including senior executives) of the Company in the form of share-based
payments, whereby employees render services in exchange for shares or rights over shares (equity-settled transactions).
The Company has an Employee Incentive Plan (EIP) in place, which provides benefits to Directors, senior executives and
employees and is governed by the EIP Rules.
The cost of these equity-settled transactions with employees is measured by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by internal valuation using a binomial /
trinomial valuation model where appropriate.
In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to
the price of the shares of Company (market conditions) if applicable.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in
which the performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become
fully entitled to the award (the vesting period).
The cumulative expense recognised for equity-settled transactions at each balance date until vesting date reflects
(a)
(b)
the extent to which the vesting period has expired; and
(the Company’s best estimate of the number of equity instruments that will ultimately vest.
No adjustment is made for the likelihood of market performance conditions being met as the effect of these conditions is
included in the determination of fair value at grant date. The statement of comprehensive income charge or credit for a
period represents the movement in cumulative expense recognised as at the beginning and end of that period.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is only conditional upon
a market condition.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 35 of 66
Note 2: Significant Accounting Policies
(p)
Equity settled transactions (Continued)
Share-based payment transactions (continued)
If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not been
modified. In addition, an expense is recognised for any modification that increases the total fair value of the share-based
payment arrangement, or is otherwise beneficial to the employee, as measured at the date of modification.
If an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet
recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award and
designated as a replacement award on the date that it is granted, the cancelled and new award are treated as if they were
a modification of the original award, as described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of earnings per
share.
Cash settled transactions:
The Company also provides benefits to employees in the form of cash-settled share-based payments, whereby employees
render services in exchange for cash, the amounts of which are determined by reference to movements in the price of the
shares of Company.
The cost of cash-settled transactions is measured initially at fair value at the grant date using the volume weighted average
traded share price for the equity granted taking into account the terms and conditions upon which the instruments were
granted. This fair value is expensed over the period until vesting with recognition of a corresponding liability. The liability
is remeasured to fair value at each balance date up to and including the settlement date with changes in fair value
recognised in profit or loss.
(q)
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. Incremental costs directly attributable to the issue of new
shares or options for the acquisition of a new business are not included in the cost of acquisition as part of the purchase
consideration.
(r)
Dividends
Dividends are recognised when declared during the financial year and no longer at the discretion of the Company.
(s)
Earnings per Share
Basic earnings/(loss) per share is calculated as net profit/(loss) attributable to members of the parent, adjusted to exclude
any costs of servicing equity (other than dividends) and preference share dividends, divided by the weighted average
number of ordinary shares, adjusted for any bonus element.
Diluted earnings/(loss) per share is calculated as net profit/(loss) attributable to members of the parent, adjusted for:
•
•
costs of servicing equity (other than dividends) and preference share dividends;
the after-tax effect of dividends and interest associated with dilutive potential ordinary shares that have been
recognised as expenses; and
other non-discretionary changes in revenues or expenses during the period that would result from the dilution of
potential ordinary shares; divided by the weighted average number of ordinary shares and dilutive potential ordinary
shares, adjusted for any bonus element.
•
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 36 of 66
Note 3: Significant Accounting Estimates and Judgements
The application of accounting policies requires the use of judgements, estimates and assumptions about carrying values of
assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based
on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions are recognised in the period in
which the estimate is revised if it affects only that period, or in the period of the revision and future periods if the revision
affects both current and future periods.
(a) Revenue from contracts with customers involving sale of goods
When recognising revenue in relation to the sale of goods to customers, the key performance obligation of the Company
is considered to be the point of delivery of the goods to the customer, as this is deemed to be the time that the customer
obtains control of the promised goods and therefore the benefits of unimpeded access.
(b)
Inventories
Management estimates the net realisable values of inventories, taking into account the most reliable evidence available at
each reporting date. The future realisation of these inventories may be affected by future technology or other market-driven
changes that may reduce future selling prices.
(c) Useful lives of depreciable assets
Management reviews its estimate of the useful lives of depreciable assets at each reporting date, based on the expected
utility of the assets. Uncertainties in these estimates relate to technical obsolescence that may change the utility of certain
software and IT equipment.
(d)
Impairment
In assessing impairment, management estimates the recoverable amount of each asset or cash-generating unit based on
expected future cash flows and uses an interest rate to discount them. Estimation uncertainty relates to assumptions about
future operating results and the determination of a suitable discount rate.
(e) Share based payment transactions
The Company 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 a binomial or trinomial model where
appropriate.
The Company measures the cost of cash-settled share-based payments at fair value at the grant date using the volume
weighted average traded share price for the equity granted taking into account the terms and conditions upon which the
instruments were granted.
(f) Recovery of deferred tax assets
Deferred tax assets are recognised for deductible temporary differences as management considers that it is probable that
sufficient future tax profits will be available to utilise those temporary differences. Significant management judgement is
required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level
of future taxable profits.
(g) 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, historical collection rates, the impact
of the Coronavirus (COVID-19) pandemic and forward-looking information that is available. The allowance for expected
credit losses, as disclosed in note 12, is calculated based on the information available at the time of preparation. The actual
credit losses in future years may be higher or lower.
(h) Lease term
The lease term is a significant component in the measurement of both the right-of-use asset and lease liability. Judgement
is exercised in determining whether there is reasonable certainty that an option to extend the lease or purchase the
underlying asset will be exercised, or an option to terminate the lease will not be exercised, when ascertaining the periods
to be included in the lease term. In determining the lease term, all facts and circumstances that create an economical
incentive to exercise an extension option, or not to exercise a termination option, are considered at the lease
commencement date. Factors considered may include the importance of the asset to the Company's operations;
comparison of terms and conditions to prevailing market rates; incurrence of significant penalties; existence of significant
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 37 of 66
Note 3: Significant Accounting Estimates and Judgements
leasehold improvements; and the costs and disruption to replace the asset. The Company reassesses whether it is
reasonably certain to exercise an extension option, or not exercise a termination option, if there is a significant event or
significant change in circumstances.
Incremental borrowing rate
(i)
Where the interest rate implicit in a lease cannot be readily determined, an incremental borrowing rate is estimated to
discount future lease payments to measure the present value of the lease liability at the lease commencement date. Such
a rate is based on what the Company estimates it would have to pay a third party to borrow the funds necessary to obtain
an asset of a similar value to the right-of-use asset, with similar terms, security and economic environment.
Long service leave
(j)
The liability for long service leave 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.
(k) Lease make good provision
A provision has been made for the present value of anticipated costs for future restoration of leased premises. The provision
includes future cost estimates associated with closure of the premises. The calculation of this provision requires
assumptions such as application of closure dates and cost estimates. The provision recognised for each site is periodically
reviewed and updated based on the facts and circumstances available at the time. Changes to the estimated future costs
for sites are recognised in the statement of financial position by adjusting the asset and the provision. Reductions in the
provision that exceed the carrying amount of the asset will be recognised in profit or loss.
(l) Warranty provision
In determining the level of provision required for warranties the Company has made judgements in respect of the expected
performance of the products, the number of customers who will actually claim under the warranty and how often, and the
costs of fulfilling the conditions of the warranty. The provision is based on estimates made from historical warranty data
associated with similar products and services.
(m) 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 Company 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 Company 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 Company unfavourably as at the
reporting date or subsequently as a result of the Coronavirus (COVID-19) pandemic.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 38 of 66
Other Notes to the Financial Statements
Note 4: Segment Reporting
The Company only operated in one segment, being design, development, manufacture and selling Remote Solar sensing,
thinking and acting platforms and associated products and services.
Note 5: Revenue from Contracts with Customers
Disaggregation of revenue
AASB 134 requires an entity to disclose a disaggregation of revenue from contracts with customers required by paragraphs
114-115 of AASB 15. The Company has selected to disaggregate revenue according to the timing of the transfer of goods
and/or services. As the Company elected the modified retrospective method of adoption, comparative information under
AASB 15 is not required as disclosures for the comparative period in the notes follow the requirements of AASB 111, AASB
118 and other related interpretations.
The Company derives its revenue from the sale of goods and the provision of services at a point in time and over time in
the following major categories.
At a point in time
Equipment sales
Field services
Over Time
Equipment rentals
Recurring revenue
30 June 2021
30 June 2020
$
$
1,762,276
701,503
2,463,779
1,578,006
1,207,097
2,785,103
1,502,734
593,304
2,096,038
1,501,293
1,204,324
2,705,617
Total revenue
5,248,882
4,801,655
The Company recognised an impairment loss on receivables from contracts with customers in the statement of profit or
loss and other comprehensive income, amounting to $26,906 for the year ended 30 June 2021 (2020: $32,709).
Note 6: Finance charges
Interest and finance charges paid/payable on borrowings
Interest and finance charges paid/payable on lease liabilities
30 June 2021
30 June 2020
$
(4,425)
(12,103)
(16,528)
$
(7,620)
(15,793)
(23,413)
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 39 of 66
Other Notes to the Financial Statements
Note 7: Income Tax
(a) The components of income tax benefit comprise:
Research & Development tax incentive
(b) The prima facie tax benefit on loss from ordinary activities
before income tax is reconciled to the income tax as follows:
Prima facie tax benefit on loss from ordinary activities before income tax
at 26% (2020: 27.5%) from ordinary operations:
Effect of items that are not assessable/deductible in determining taxable
loss:
-
-
-
-
-
Other non-allowable items
Other non-assessable items
Revenue losses not recognised
Other deferred tax balances not recognised
Research & Development tax incentive
30 June 2021
30 June 2020
$
$
(329,533)
(329,533)
(231,126)
(231,126)
(542,086)
(509,807)
190,268
(16,250)
377,317
(9,249)
(329,533)
153,115
(13,750)
400,906
(30,464)
(231,126)
Income tax benefit reported in the consolidated statement of profit
or loss and other comprehensive income from ordinary operations
(329,533)
(231,126)
(c) Recognised deferred tax liabilities at 25% (2020:27.5%) (Note1)
Intangible assets
Other
Recognised deferred tax assets at 25% (2020:27.5%) (Note 1)
Carry forward revenue losses
Net deferred tax
(d) Unrecognised deferred tax assets at 25% (2020:27,.5%) (Note 1)
Carry forward revenue losses
Provisions and accruals
Capital raising costs
Other
44,898
394
45,292
45,292
-
1,478,413
173,039
73,020
4,147
89,523
718
90,241
90,241
-
1,118,225
135,217
67,686
3,493
1,728,619
1,324,621
The tax benefits of the above Deferred Tax Assets will only be obtained if:
(a)
the company derives future assessable income of a nature and of an amount sufficient to enable the benefits to
be utilised;
the company continues to comply with the conditions for deductibility imposed by law; and
(b)
(c) no changes in income tax legislation adversely affect the company in utilising the benefits.
Note 1 - the corporate tax rate for eligible companies will reduce from 27.5% to 25% by 30 June 2022 providing certain
turnover thresholds and other criteria are met. Deferred tax assets and liabilities are required to be measured at the tax
rate that is expected to apply in the future income year when the asset is realised, or the liability is settled. The Directors
have determined that the deferred tax balances be measured at the tax rates stated.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 40 of 66
Other Notes to the Financial Statements
Note 8: Issued Capital
As at 30 June 2021, the Company had the following issued share capital:
30 June 2021
30 June 2020
Number
$
Number
$
Fully paid ordinary shares
106,305,280
12,573,174
75,633,065
11,084,845
Movement of issued share capital:
Balance at beginning of year
75,633,065
11,084,845
Placement at $0.13
Placement at $0.05
Shares issued on exercise of performance
rights (i)
Issue of shares in lieu of Director fees
Share issue costs
Balance at end of year
-
-
30,253,227
1,512,661
56,402,293
12,230,773
-
8,997,115
1,590,000
-
-
418,988
-
-
6,999,999
700,000
24,661
(48,993)
-
-
-
(202,270)
106,305,280
12,573,174
75,633,065
11,084,845
(i)
Performance rights converted during the prior financial year.
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion
to the number of and amounts paid on the shares held. On a show of hands every holder of ordinary shares present at a
meeting in person or proxy, is entitled to one vote, and upon a poll each share is entitled to one vote.
Ordinary shares have no par value and the Company does not have a limited amount of authorised capital.
Note 9: Reserves
Nature and purpose of reserves
Options Reserve
This reserve is used to record the value of options subscribed for or provided to employees and consultants. Refer to
Note 26 for further details of these plans.
Performance Rights Reserve
This reserve is used to record the value of performance rights provided to employees, Directors and consultants as part of
their remuneration. Refer to Note 26 for further details of these plans
At 30 June 2021, the Company had the following reserve accounts:
30 June 2021
30 June 2020
Number
$
Number
$
Options
Performance rights
Balance at end of year
4,300,000
11,604,153
15,904,153
151,396
26,376
177,772
22,419,933
2,646,263
25,066,196
494,049
10,430
504,479
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 41 of 66
Other Notes to the Financial Statements
Note 9: Reserves (continued)
OPTIONS RESERVE MOVEMENT
30 June 2021
30 June 2020
Number
$
Number
$
Movement of Company options:
Balance at beginning of year
Options issued to broker (i)
Options issued to employees
Options issued to directors (ii)
Value of all employee options brought to
account during the year
Expired options transferred to retained
earnings
22,419,933
494,049
-
2,200,000
2,100,000
-
77,458
73,938
-
-
(22,419,933)
(494,049)
18,419,933
4,000,000
386,446
100,000
-
-
-
-
-
-
7,603
-
Balance at end of year
4,300,000
151,396
22,419,933
494,049
(i)
Issued to Pac Partners (or their nominees) on 23 August 2019, as part consideration for services performed by acting
as lead manager to the 2019 Placement. Approved by shareholders on 12 August 2019.
(ii) Shareholder approval to be sought at the upcoming AGM.
PERFORMANCE RIGHTS RESERVE MOVEMENT
30 June 2021
30 June 2020
Number
$
Number
$
Movement of issued performance rights:
Balance at beginning of year
Brought to account during the year (i)
Performance rights cancelled during the
year
Performance rights converted to shares (ii)
Performance rights forfeited / written off (iii)
2,646,263
9,464,383
(506,493)
-
-
Balance at end of year
11,604,153
10,430
61,615
-
-
(45,669)
26,376
7,333,332
2,312,930
722,222
55,772
(6,999,999)
(700,000)
-
2,646,263
(67,564)
10,430
(i)
Issued to key employees under Spectur’s LTI plan. Refer Note 26. The issue of the 2,083,333 Performance Rights to Dr
Dyson is conditional on the receipt of shareholder approval which is to be sought at the Company’s 2021 Annual General
Meeting (AGM).
(ii) Tranche 2 performance rights vesting for FY19 converted into fully paid ordinary shares.
(iii) Value of performance rights written back due to vesting conditions not anticipated being met and employee cessation.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 42 of 66
Other Notes to the Financial Statements
Note 10: Loss per Share
Basic loss per share
Basic and diluted loss per share
Losses
Losses used in the calculation of basic loss per share is as follows:
Loss for the year
Weighted average number of ordinary shares
30 June 2021
30 June 2020
Cents per share
Cents per share
(1.70)
(2.25)
30 June 2021
30 June 2020
$
$
(1,755,415)
(1,622,698)
The weighted average number of ordinary shares used in the calculation of basic and diluted loss per share is as follows:
Weighted average number of ordinary shares for the purpose of basic
loss per share
30 June 2021
30 June 2020
Number
Number
103,464,820
72,053,005
Share options and performance rights are not considered dilutive, as their impact would be to decrease the net loss per
share.
Note 11: Cash and Cash equivalents
Reconciliation to the Statement of Cash Flows:
For the purposes of the statement of cash flows, cash and cash equivalents comprise cash on hand and at bank, net of
outstanding bank overdrafts.
Cash and cash equivalents as shown in the statement of cash flows is reconciled to the related items in the statement of
financial position as follows:
Cash on hand and in bank
Credit cards
Short term deposits
Net cash and cash equivalents
30 June 2021
30 June 2020
$
1,689,960
(1,248)
-
1,688,712
$
621,739
(3,710)
1,014,484
1,632,513
At 30 June 2021, the Company had a credit card facility of $50,000 (2020: $50,000) and does not attract any interest if paid
within the required period.
Term deposits are taken for periods between one and three months, depending on the immediate cash requirements of the
Company, and earn interest at the respective short-term deposit rates
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 43 of 66
30 June 2021
30 June 2020
$
$
(1,755,415)
(1,622,698)
Other Notes to the Financial Statements
Note 11: Cash and Cash equivalents (continued)
11.1 Reconciliation of loss after tax to net cash outflow from operating activities:
Loss for the year
Adjustments for non-cash income and expense items
Depreciation and amortisation
Impairment of intangibles
Accrued R&D & COVID 19 refund receivable
(Profit) / Loss on disposal of property and equipment
Share-based payment expense
Issue of Shares in lieu of Director fees
Provisions
Change in assets and liabilities
Decrease / (Increase) in trade and other receivables
(Increase) in inventories
(Decrease) / Increase in trade and other payables
Net cash outflow from operating activities
568,257
12,640
(220,283)
1,674
167,342
24,661
264,911
(323,455)
(281,482)
577,346
(963,804)
11.2 Reconciliation of liabilities arising from cash flows from financing activities:
Notes
Lease liability
Balance at 1 July 2019
Leases recognised on the adoption of AASB 16
Acquisition of leases
Derecognition of leases
Repayments
Repayment relating to investing activities
Interest paid
Balance at 30 June 2020
Acquisition of leases
Derecognition of leases
Repayments
Repayment relating to investing activities
Interest paid
Balance at 30 June 2021
20
21
21
21
21
21
21
21
21
21
21
20 & 21
-
242,852
322,910
(190,760)
(109,724)
-
15,793
281,071
142,443
-
Loans
208,947
-
-
-
(75,857)
(47,162)
7,560
93,488
-
-
(107,853)
(37,400)
(145,253)
-
12,102
327,763
-
4,425
60,513
-
16,527
388,276
581,069
74,006
(302,619)
45,931
18,033
-
(31,318)
779,606
443,266
(436,465)
(451,189)
Total
208,947
242,852
322,910
(190,760)
(185,581)
(47,162)
23,353
374,559
142,443
-
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 44 of 66
Other Notes to the Financial Statements
Note 12: Trade and Other receivables
Trade receivables (i)
Allowance for expected credit losses (ii)
Prepayments
Other
COVID 19 relief
R&D refund receivable
Total
30 June 2021
30 June 2020
$
$
996,481
(30,898)
965,583
30,920
47,808
-
220,283
1,264,594
413,724
(51,765)
361,959
26,758
88
137,684
164,935
691,424
(i)
(ii)
Trade receivables are non-interest bearing and are generally on terms of 30 days to 60 days. All amounts are short
term. The carrying value of trade receivables is considered a reasonable approximation of fair value.
Note 24 includes disclosures relating to the credit risk exposures and analysis relating to the allowance for expected
credit losses.
Movement in allowance for expected credit losses
Balance at the beginning of the year
Provision for expected credit losses
Written off
Closing balance
30 June 2021
30 June 2020
$
$
51,765
6,039
(26,906)
30,898
19,056
32,709
-
51,765
Expected credit losses
The Company applies the AASB 9 simplified model of recognising lifetime expected credit losses for all trade receivables
as these items do not have a significant financing component. In measuring the expected credit losses, the trade receivables
have been assessed on a collective basis as they possess shared credit risk characteristics. They have been grouped based
on the days past due.
The expected loss rates are based on the payment profile for sales over the past 24 months before 30 June 2021 and 30
June 2020 respectively as well as the corresponding historical credit losses during that period. Trade receivables are
written off when there is no reasonable expectation of recovery. Failure to make payments within 180 days from the invoice
date and failure to engage with the Company on alternative payment arrangement amongst other is considered indicators
of no reasonable expectation of recovery. On the above basis the expected credit loss for trade receivables at 30 June 2021
and 30 June 2020 was determined as follows:
30 June 2021
Current (not
past due)
1 – 30 days
past due
31 – 60 days
past due
61 – 90 days
past due
More than
90 days past
due
Total
Trade receivables past due
Expected credit
loss rate
Gross carrying
amount
Lifetime expected
credit loss
1.6%
2.2%
4.0%
9.9%
17.6%
3.1%
689,035
190,939
26,554
15,588
74,365
996,481
10,969
4,236
1,061
1,547
13,085
30,898
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 45 of 66
Other Notes to the Financial Statements
Note 12: Trade and other Receivables (continued)
Expected credit losses (continued)
30 June 2020
Current (not
past due)
1 – 30 days
past due
31 – 60 days
past due
61 – 90 days
past due
More than
90 days
past due
Total
Trade receivables past due
Expected credit
loss rate
Gross carrying
amount
Lifetime expected
credit loss
0%
0%
0%
0%
79.6%
12.5%
139,830
113,017
71,403
24,474
65,000
413,724
-
-
-
-
51,765
51,765
The closing balance of the trade receivables allowance for expected credit losses as at 30 June 2021 reconciles with the
trade receivables allowance for expected credit losses opening balance as follows:
30 June 2019
Amounts written off
Net remeasurement of loss allowance
30 June 2020
Amounts written off
Net remeasurement of loss allowance
Closing balance – 30 June 2021
Note 13: Inventories
Raw materials – cost
Work in progress – cost
Finished goods - cost
Total
30 June 2021
$
19,056
-
32,709
51,765
(26,906)
6,039
30,898
30 June 2021
30 June 2020
$
$
559,209
18,287
197,417
774,913
209,317
108,592
175,521
493,430
Inventories are valued at the lower of cost and net realisable value.
Costs incurred in bringing each product to its present location and condition is accounted for as follows:
• Raw materials – purchase cost on a first-in, first-out basis; and
• Work in progress – purchase cost on a first-in, first-out basis; and
•
Finished goods – cost of direct materials and labour and a proportion of manufacturing overheads based on normal
operating capacity.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and
the estimated costs necessary to make the sale.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 46 of 66
Other Notes to the Financial Statements
Note 14: Property, Plant and Equipment
Camera
equipment
$
Improve-
ments
$
Plant and
equipment
$
Office
equipment
Motor
Vehicles
Total
$
$
$
Balance at 1 July 2020
Additions
Disposals
388,945
218,101
(1,808)
4,761
6,256
-
43,738
12,863
-
60,696
10,938
-
123,708
-
-
621,848
248,158
(1,808)
Depreciation charge for the year
(243,194)
(1,525)
(16,158)
(28,915)
(36,885)
(326,677)
Balance at 30 June 2021
362,044
9,492
40,443
42,719
86,823
541,521
Balance at 1 July 2019
Additions
Disposal
348,801
268,592
(40,152)
Depreciation charge for the year
(188,296)
Balance at 30 June 2020
388,945
13,594
-
(6,566)
(2,267)
4,761
51,534
8,842
-
80,744
12,125
(440)
150,595
-
-
645,268
289,559
(47,158)
(16,638)
(31,733)
(26,887)
(265,821)
43,738
60,696
123,708
621,848
Plant and equipment
The carrying value of plant and equipment held under chattel mortgage contracts at 30 June 2021 is $8,894 (2020: $12,993).
Additions during the year include $nil (2020: $nil) of plant and equipment held under chattel mortgage contracts. There
were no disposals during the current or prior year of plant and equipment held under chattel mortgage contracts.
Motor Vehicles
The carrying value of motor vehicles held under chattel mortgage contracts at 30 June 2021 is $67,855 (2020: $117,759).
Note 15: Investment accounted for using the equity method
Name of joint
venture
Country of
incorporation
and principal
place of business
Principal activity
Proportion of
ownership interests
held by Spectur
Spectur New
Zealand Pty Ltd
30 June 2021
30 June 2020
Provide Spectur security, sensing
and visual artificial intelligence
products to New Zealand
customers.
NZ
51%
-
The investment in Spectur NZ is accounted for using the equity method in accordance with AASB 128.
No dividends were received from Spectur NZ during the year ended 30 June 2021.
Spectur NZ is a private company; therefore, no quoted market prices are available for its shares.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 47 of 66
Other Notes to the Financial Statements
Note 16: Intangibles
Carrying value
Cost
Impairment
Patents
Product
Development
Other
Intangibles
Total
$
$
$
$
Accumulated amortisation
(15,624)
(510,037)
38,674
-
739,339
(72,763)
100,000
(13,884)
(86,116)
878,013
(86,647)
(611,777)
Carrying value at 30 June 2021
23,050
156,539
-
179,589
Cost
Impairment
38,674
-
739,339
(60,122)
Accumulated amortisation
(10,416)
(397,702)
100,000
(13,884)
(86,116)
878,013
(74,006)
(494,234)
Carrying value at 30 June 2020
28,258
281,515
-
309,773
Reconciliation – current year
Carrying value as at 1 July 2020
Amortisation
Impairment
Carrying value at 30 June 2021
Reconciliation – prior year
Carrying value as at 1 July 2019
Amortisation
Impairment
Carrying value at 30 June 2020
Patents
Product
Development
Other
Intangibles
Total
$
$
28,258
(5,208)
-
23,050
33,466
(5,208)
-
28,258
281,515
(112,336)
(12,640)
156,539
516,624
(174,987)
(60,122)
281,515
$
-
-
-
-
47,220
(33,336)
(13,884)
-
$
309,773
(117,544)
(12,640)
179,589
597,310
(213,531)
(74,006)
309,773
Intangible assets acquired separately
Intangible assets acquired separately are recorded at cost less accumulated amortisation and impairment. Amortisation is
charged on a straight-line basis over their estimated useful lives. The estimated useful life and amortisation method is
reviewed at the end of each annual reporting period, with any changes in these accounting estimates being accounted for
on a prospective basis.
Patents
Patents that have lapsed or are forfeited and are not rolled into new patents, have been impaired and moved to an expense
in the year the patents lapsed/expired.
Internally generated intangible assets – research and development expenditure
Expenditure on research activities is recognised as an expense in the period in which it is incurred. Where no internally
generated intangible asset can be recognised, development expenditure is recognised as an expense in the period as
incurred.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 48 of 66
Other Notes to the Financial Statements
Note 16: Intangibles (continued)
An intangible asset arising from development (or from the development phase of an internal project) is recognised if, and
only if, all of the following have been demonstrated:
•
•
•
•
•
•
The technical feasibility of completing the intangible asset so that it will be available for use or sale;
The intention to complete the intangible asset and use or sell it;
The ability to use or sell the intangible asset;
How the intangible asset will generate probable future economic benefits;
The availability of adequate technical, financial and other resources to complete development and to use or sell the
intangible asset; and
The ability to measure reliably the expenditure attributable to the intangible asset during its development.
The amount initially recognised for internally generated intangible assets is the sum of the expenditure incurred from the
date when the intangible asset first meets the recognition criteria listed above.
Subsequent to initial recognition, internally generated intangible assets are reported at cost less accumulated amortisation
and accumulated impairment losses, on the same basis as intangible assets acquired separately.
The following useful lives are used in the calculation of amortisation:
Patents
Product development
Other Intangibles
8 Years
3 to 5 Years
3 Years
Impairment of tangible and intangible assets other than Other Intangibles
The Company assesses at each balance date whether there is an indication that an asset may be impaired. If any such
indication exists, or when annual impairment testing for an asset is required, the Company makes an estimate of the asset’s
recoverable amount. An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use and
is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those
from other assets or group of assets and the asset's value in use cannot be estimated to be close to its fair value. In such
cases the asset is tested for impairment as part of the cash-generating unit to which it belongs. When the carrying amount
of an asset or cash-generating unit exceeds its recoverable amount, the asset or cash-generating unit is considered impaired
and is written down to its recoverable amount.
Other Intangibles
Other Intangibles acquired are initially measured at cost.
Following initial recognition, Other Intangibles are measured at cost less amortisation and any impairment losses.
Other Intangibles are reviewed for impairment annually or more frequently if events or changes in circumstances indicate
that the carrying value may be impaired.
Impairment is determined by assessing the recoverable amount of the cash-generating unit (Group of cash-generating units),
to which the Other Intangibles relates. When the recoverable amount of the cash-generating unit (Group of cash-generating
units) is less than the carrying amount, an impairment loss is recognised. When Other Intangibles forms part of a cash-
generating unit (Group of cash-generating units) and an operation within that unit is disposed of, the Other Intangibles
associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or
loss on disposal of the operation. Other Intangibles disposed of in this manner is measured based on the relative values of
the operation disposed of and the portion of the cash-generating unit retained.
Impairment losses recognised for Other Intangibles are not subsequently reversed.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 49 of 66
Other Notes to the Financial Statements
Note 17: Right-of-use Assets
Land and buildings – right-of-use
Less: Accumulated depreciation
Carrying value at 30 June 2021
Reconciliation
Recognised on 1 July 2019 on adoption of AASB 16
Additions
Derecognised 1
Depreciation expense
Total
30 June 2021
30 June 2020
$
$
480,932
(160,644)
320,288
322,910
(44,880)
278,030
30 June 2021
30 June 2020
$
$
278,030
158,022
-
(115,764)
320,288
242,852
322,910
(186,014)
(101,718)
278,030
1 A new lease was signed for the Sunshine West premises.
The Company leases land and buildings for its offices and warehouses under agreements of between two to three years
with, in some cases, options to extend. The leases have various escalation clauses. On renewal, the terms of the leases are
renegotiated.
Note 18: Trade and other payables
Accounts payable (i)
Accruals
ATO & State Governments
Unearned revenue
Customer pre-payments
Other payables
Total
30 June 2021
30 June 2020
$
$
245,034
166,725
324,704
558,764
45,391
248
1,340,866
116,999
227,676
127,423
330,221
-
3,744
806,063
(i) Trade payables are non-interest bearing and are normally settled on 30-day terms. Refer to note 24 for further
information on financial instruments.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 50 of 66
Other Notes to the Financial Statements
Note 19: Employee benefits
Current Liabilities
Non-Current liabilities
30 June 2021
30 June 2020
$
$
463,529
214,340
67,324
60,117
Current
Employee benefits expected to be settled within the next 12 months. The current provision for employee benefits includes
all unconditional entitlements where employees have completed the required period of service and also where employees
are entitled to pro-rata payments in certain circumstances. The entire amount is presented as current, since the company
does not have an unconditional right to defer settlement. However, based on past experience, the company does not
expect all employees to take the full amount of accrued leave or require payment within the next 12 months.
Non-current
Employee benefits expected to be settled after 12 months
Note 20: Borrowings and other financial liabilities
Current loans
Secured loans
Total current loans
Non-current loans
Secured loans
Total non-current loans
30 June 2021
30 June 2020
$
$
60,513
60,513
-
-
32,975
32,975
60,513
60,513
Total loans
60,513
93,488
Secured Loans
These loans are secured by Plant and Equipment as well as Motor Vehicles. The interest rates on these loans are fixed and
range between 4.97% to 5.87% and interest is repayable within a period of 12 months from the reporting date. Total monthly
repayments are $1,149 with total balloon payments of $45,810.
Spectur Ltd has secured a $1.5 million loan facility from EGP Capital with drawdown available from 1 July 2021. There is a
3%-line fee payable, as well as interest at 7% on any drawn amounts. Spectur Ltd will also issue 2.25 million unquoted
options to EGP Capital exercisable at $0.12 on or before 31 December 2023. The issue of the options is subject to
shareholder approval, failing which the drawn down amounts (principal, fees and interest) will become payable with 45 days.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 51 of 66
Other Notes to the Financial Statements
Note 21: Lease liabilities
Current lease liabilities
Non-current lease liabilities
Reconciliation
Opening Balance
Recognised on 1 July 2019 on adoption of AASB 16
Lease inception
Leases derecognised
Principal repayments
Total
The Company leases several premises, and the average lease term is 3 years.
Refer Note 24 for further information on financial instruments.
Note 22: Provisions
30 June 2021
30 June 2020
$
$
158,310
169,453
327,763
100,534
180,537
281,071
30 June 2021
30 June 2020
$
281,071
-
142,443
-
(95,751)
327,763
$
-
242,852
322,910
(190,760)
(93,931)
281,071
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it
is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation. Provisions are not recognised for future operating losses.
When the Company expects some or all of a provision to be reimbursed, for example under an insurance contract, the
reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating
to any provision is presented in the statement of profit or loss and other comprehensive income net of any reimbursement.
Provisions are measured at the present value or management’s best estimate of the expenditure required to settle the
present obligation at the end of the reporting period.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects the
risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised
as an interest expense.
Warranties
Provisions for the expected cost of warranty obligations under local sale of goods legislation are recognised at the date of
sale of the relevant products, at the Directors’ best estimate of the expenditure required to settle the Company’s obligation.
Equipment Rental Costs
The provision for equipment rental costs relates to the estimated cost of work to be carried out in relation to the removal
and refurbishment of rental equipment at the end of the rental agreement term. The provision represents the best estimate
of the present value of the expenditure required to settle the obligation at the reporting date. Future costs are reviewed
annually and any changes in the estimate are reflected in the present value of the equipment rental provision at each
reporting date.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 52 of 66
Other Notes to the Financial Statements
Note 22: Provisions (continued)
Balance as at 30 June 2020
Provided during the year
Utilised
Balance at 30 June 2021
Balance as at 30 June 2019
Provided during the year
Unused amounts reversed
Utilised
Balance at 30 June 2020
Note 23: Dividends
Warranties Equipment Rental
Total current
$
$
$
29,693
87,103
(61,634)
55,162
76,494
-
(2,811)
(43,990)
29,693
59,137
31,596
(31,596)
59,137
49,449
42,492
-
(32,804)
59,137
88,830
118,699
(93,230)
114,299
125,943
42,492
(2,811)
(76,794)
88,830
The directors of the Company have not declared any dividend for the years ended 30 June 2021 and 2020.
Note 24: Financial Instruments
Capital risk management
The Company’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 and reduce
the cost of capital.
The capital structure of the Company consists of cash and cash equivalents, borrowings and equity attributable to equity
holders of the Company, comprising issued capital, reserves and retained earnings. Operating cash flows are used to
maintain and expand operations, as well as to make routine expenditures such as tax, dividends and general administrative
outgoings. The Company 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 30 June 2020 Annual Report.
Financial risk management objectives
The Company is exposed to:
(i) market risk (which includes foreign currency exchange risk, interest rate risk, share price risk and commodity price risk),
(ii) credit risk and
(iii) liquidity risk.
Compliance with policies and exposure limits is reviewed by management on a continuous basis. The Company does not
enter into or trade financial instruments, including derivative financial instruments.
Market risk
The Company’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates, interest
rates, and share prices. There has been no change to the Company’s exposure to market risks or the way it manages and
measures the risk from the previous period.
Foreign currency exchange risk management
The Company undertakes certain transactions denominated in foreign currencies, hence exposures to exchange rate
fluctuations arise. Exchange rate exposures are managed within approved policy parameters utilising purchasing limits.
The carrying amounts of the Company’s foreign currency denominated monetary assets and monetary liabilities at the
balance date expressed in Australian dollars were nil.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 53 of 66
Other Notes to the Financial Statements
Note 24: Financial Instruments(continued)
Foreign currency sensitivity analysis
The sensitivity analyses below detail the Company’s sensitivity to an increase/decrease in the Australian dollar against the
United States dollar. The sensitivity analysis includes only outstanding foreign currency denominated monetary items.
A 100-basis point is the sensitivity rate used when reporting foreign currency risk internally to management and represents
management’s assessment of the possible change in foreign exchange rates. At balance date, if foreign exchange rates had
been 10 basis point higher or lower and all other variables were held constant, the Company’s:
•
•
The Company’s sensitivity to foreign exchange has not changed significantly from the prior year.
Profit or loss would increase/decrease by $nil (2020: $nil); and
Equity reserves would increase/decrease by $nil (2020: $nil).
Interest rate risk management
The Company's exposure to the risk of changes in market interest rates relates primarily to the bank overdrafts with floating
interest rate.
These financial assets with variable rates expose the Company to cash flow interest rate risk. All other financial assets and
liabilities, in the form of receivables and payables are non-interest bearing.
A 10-basis point increase or decrease is used when reporting interest rate risk internally to management and represents
management’s assessment of the change in interest rates.
At balance date, if interest rates had been 10 basis points higher or lower and all other variables were held constant, the
Company’s:
•
•
The Company’s sensitivity to interest rate risk has decreased during the year mainly due to the reduction in cash invested
in term deposits.
Profit or loss would increase/decrease by $nil (2020: $1,014); and
Equity reserves would increase/decrease by $nil (2020: $1,014).
Credit risk management
Credit risk is the risk that a counterparty fails to discharge an obligation to the Company. The Company is exposed to credit
risk from financial assets including cash and cash equivalents held at banks and trade and other receivables. The Company
only transacts with entities that are rated the equivalent of investment grade and above. This information is supplied by
independent rating agencies where available and, if not available, the Company uses publicly available financial information
and its own trading record to rate its major customers.
The Company does not have any significant credit risk exposure to any single counterparty or any Company of
counterparties having similar characteristics.
Liquidity risk management
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Board's
approach to managing liquidity is to ensure, as far as possible, that the Company will always have sufficient liquidity to meet
its liabilities when due by continuously monitoring forecast and actual cash flows and matching the maturity profiles of
financial assets and liabilities.
Non-derivative financial liabilities
The following tables detail the Company’s expected contractual maturity for its non-derivative financial liabilities.
These have been drawn up based on undiscounted contractual maturities of the financial liabilities based on the earliest date
the Company can be required to repay.
The tables include both interest and principal cash flows.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 54 of 66
Other Notes to the Financial Statements
Note 24: Financial instruments (continued)
30 June 2021
≤6 Months
$
6-12 Months
$
1-5 Years
$
≥5 Years
$
Total
$
Financial Liabilities
Trade and other payables
1,340,866
Lease liabilities
Loans payable
Total
30 June 2020
Financial Liabilities
Trade and other payables
Lease liabilities
Loans payable
Total
Fair value measurement
85,598
40,824
-
85,698
19,689
-
175,882
-
1,467,288
105,387
175,882
-
-
-
-
1,340,866
347,178
60,513
1,748,557
≤6 Months
$
6-12 Months
$
1-5 Years
$
≥5 Years
$
Total
$
869,266
61,920
18,700
949,886
-
61,920
18,700
80,620
-
176,730
60,915
237,645
-
-
-
-
869,266
300,570
98,315
1,268,151
The net fair value of financial assets and financial liabilities approximates their carrying value. The methods for estimating
fair value are outlined in the relevant notes to the financial statements.
The Company has several financial instruments which are not measured at fair value in the statement of financial position.
The Directors consider that the carrying amounts of current receivables, current payables and current borrowings are a
reasonable approximation of their fair values.
Note 25: Contingent liabilities
The Company had no contingent liabilities as at the reporting date.
Note 26: Share-based payments
a) Recognised Share-based Payment Expense
From time to time, the Company provides Incentive Options or Performance Rights to officers, employees, consultants and
other key advisors as part of remuneration and incentive arrangements. The number of options / Performance Rights
granted and the terms of the options granted are determined by the Board. Shareholder approval is sought where required.
During the past two years, the following equity-settled share-based payments have been recognised:
Expense arising from equity-settled share-based payment transactions
Value of Performance Rights forfeited / written back
Net share based (income) / payment expense recognised in
profit or loss
30 June 2021
$
213,011
(45,669)
30 June 2020
$
52,264
(34,231)
167,342
18,033
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 55 of 66
Other Notes to the Financial Statements
Note 26: Share-based payments (continued)
a) Recognised Share-based Payment Expense (continued)
The following share-based payment arrangements were in place during the current and prior periods:
Options
Number
Grant date
Expiry date
Exercise
price
Fair value
at balance
date Vesting date
$
$
$
Employee options
2,200,000 30 June 2021 30 June 2024
Director options
2,100,000 30 June 2021 30 June 2024
0.10
0.10
77,458 30 June 2021
73,938
(ii
(i) During the year ended 30 June 2021, an expense of $151,396 (2020: $7,686) was incurred for options issued.
(ii) The issue of the Director options is conditional on the receipt of shareholder approval which is to be sought at the
Company’s 2021 Annual General Meeting (AGM).
Performance rights
Number
Grant date
Expiry date
Value at
grant date
Fair value
at balance
date3 Vesting date
$
$
$
Director
Employees 1
Director
Employees
Director 2 & 3
Employees 2
1,607,919
11 Nov 2019
30 Jun 2023
531,851
11 Nov 2019
30 Jun 2023
3,301,887
30 Oct 2020
30 Jun 2024
1,014,151
30 Oct 2020
30 Jun 2024
2,083,333
28 Jun 2021
30 Jun 2024
3,065,012
28 Jun 2021
30 Jun 2024
0.09
0.09
0.05
0.05
0.07
0.07
147,971
30 Jun 2022
14,500
30 Jun 2022
138,422
30 Jun 2023
14,337
30 Jun 2023
145,833
30 Jun 2023
214,551
30 Jun 2023
1 During the year ended 30 June 2021, 1,024,676 (2020: 173,160) employee performance rights were forfeited for cessation
of employment. This resulted in a reversal of previously expensed amounts of $5,035 (2020: $2,940). These Performance
Rights will be cancelled following the year end audit.
2 No expense was recognised for the year ended 30 June 2021 due to the minimal vesting relating to the 2021 financial
year.
3 The issue of the Performance Rights is conditional on the receipt of shareholder approval which is to be sought at the
Company’s 2021 Annual General Meeting (AGM).
Dividend yield (%)
Expected volatility (%)
Risk-free interest rate (%)
Expected life of rights (years)
Exercise price (cents)
Grant date share price
Director
0%
90.97%
1.69%
3
-
0.07
Employees
0%
90.97%
1.69%
3
-
0.07
The expected life of the performance rights is based on historical data and is not necessarily indicative of exercise patterns
that may occur. The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which
may also not necessarily be the actual outcome. No other features of performance rights granted were incorporated into
the measurement of fair value.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 56 of 66
Other Notes to the Financial Statements
Note 26: Share-based payments (continued)
b) Summary of Options Granted as Share-based Payments
The following table illustrates the number and weighted average exercise prices (WAEP) of Incentive Options granted as
share-based payments at the beginning and end of the financial year:
30 June 2021
30 June 2020
Number
WAEP
Number
WAEP
Outstanding at beginning of year
Expired options
Granted by the Company during the year
Outstanding at end of year
Exercisable at the end of year
7,000,000
(7,000,000)
4,300,000
4,300,000
4,300,000
$0.20
$0.20
$0.10
$0.10
-
3,000,000
-
4,000,000
7,000,000
7,000,000
$0.21
-
$0.20
$0.20
-
Note 27: Related party disclosures
The Company’s related parties include Key Management and others as described below.
Transactions with Key Management Personnel
The aggregate compensation made to Directors and other Key Management Personnel of the Company is set out below:
Short-term employee benefits
Share-based payment
Total
30 June 2021
30 June 2020
$
396,617
89,669
486,286
$
502,993
7,812
510,805
The amount of share-based payments is calculated in accordance with AASB 2.
More detailed information concerning the remuneration of key management is shown in the Remuneration report page 12.
Note 28: Auditor’s remuneration
The auditor of Spectur Limited is HLB Mann Judd.
30 June 2021
30 June 2020
$
$
Audit and review of the financial statements
46,100
44,700
Note 29: Events after the reporting date
On 23 July 2021 Spectur completed the allocation of incentive awards to certain key management and senior employees
under its Employee Incentive Scheme approved at the Company's 2019 Annual General Meeting (Scheme).
Long Term Incentives - Performance Rights
3,065,012 Performance Rights were allocated and issued to key management personnel and senior employees (other than
Directors) under the Scheme as long-term incentives.
In addition to the above issue, and pursuant to his Executive Employment Contract, Managing Director Dr Gerard Dyson,
has been allocated 2,083,333 Performance Rights on the same terms and conditions. The issue of the Performance Rights
to Dr Dyson is conditional on the receipt of shareholder approval which is to be sought at the Company’s 2021 Annual
General Meeting (AGM).
The Performance Rights are issued for $nil cash consideration but will not vest unless the performance conditions set by
the Board have been satisfied, with the final quantum to be determined on the vesting and measurement date of 30 June
2023. Refer to Section E of the Remuneration Report of the accounts for the details of the performance conditions.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 57 of 66
Other Notes to the Financial Statements
Note 29: Events after the reporting date (continued)
Incentive Options
In recognition of the continued dedication of the key management and senior employees of Spectur, in particular during
FY20 and FY21, throughout periods of Company imposed salary reductions, the Board issued 2,200,000 unquoted Options
to members of Spectur’s key management personnel (other than Directors) under the Scheme.
The Options are exercisable at $0.10, being a 43% premium to the SP3 5-day Volume Weighted Average Share Price
(VWAP) prior to 30 June 2021, and have an expiry date of 30 June 2024. The Options are not subject to vesting conditions.
The Board has also resolved to issue, conditional on the receipt of shareholder approval to be sought at the AGM, 2,100,000
Incentive Options under the Scheme as follows:
•
•
1,100,000 Incentive Options to the Managing Director, Dr Gerard Dyson; and
500,000 Incentive Options to each of the Non-Executive Directors, Bilyana Smith and Darren Cooper.
The Director Incentive Options will be unquoted, exercisable at a 42% premium to the VWAP to be calculated based upon
the 5-day period up to and including the date of the AGM. The Options will not be subject to vesting conditions.
Cancellation of Performance Rights
A total of 1,024,676 FY20 and FY21 Performance Rights were cancelled due to the vesting conditions no longer being
attainable due to cessation of employment.
The Directors are not aware of any matter or circumstance that has arisen since 30 June 2021 which significantly affected,
or may significantly affect, the operations of the Company, the results of those operations, or the state of affairs of the
Company, in future financial years.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 58 of 66
DIRECTORS’ DECLARATION
1.
In the opinion of the Directors of Spectur Limited (“Spectur” or the “Company”):
a.
the accompanying financial statements and notes are in accordance with the Corporations Act 2001 including:
i.
ii.
giving a true and fair view of the Company’s financial position at 30 June 2021 and of its performance
for the year then ended in accordance with the accounting policies described in the notes to the
financial statements; and
complying with Australian Accounting Standards, the Corporations Regulations 2001, professional
reporting requirements and other mandatory requirements.
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 financial statements and notes thereto are in accordance with International Financial Reporting Standards
issued by the International Accounting Standards Board.
b.
c.
2.
This declaration has been made after receiving the declarations required to be made to the Directors in accordance
with Section 295A of the Corporations Act 2001 for the financial year ended 30 June 2021.
This declaration is signed in accordance with a resolution of the board of Directors.
______________________________
Darren Cooper
Director
Dated this 30 August 2021
.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 59 of 66
INDEPENDENT AUDITOR’S REPORT
To the members of Spectur Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Spectur Limited (“the Company”) which comprises the
statement of financial position as at 30 June 2021, the statement of profit or loss and other
comprehensive income, the statement of changes in equity and the 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 Company is in accordance with the
Corporations Act 2001, including:
a) giving a true and fair view of the Company’s financial position as at 30 June 2021 and of its
financial performance for the year then ended; and
b) 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 Company 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 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. We have determined the matters described below
to be the key audit matters to be communicated in our report.
Page 60 of 66
Key Audit Matter
How our audit addressed the key audit
matter
Revenue and related risk of fraud
Refer to Note 5
The total revenue from operations for the year is
$5,248,882, with revenue being predominately
generated through equipment sales, rentals and
related services.
Due to the material nature of this balance and the
presumption of fraud risk over revenue recognition, as
prescribed by Australian Auditing Standards, this area
has been subject to significant audit procedures.
Our procedures included but were not limited
to the following:
• We reviewed the Company’s accounting
policy regarding the recognition and/or
deferral of revenue in line with AASB 15
Revenue from Contracts with Customers;
• We reviewed the calculation of deferred
revenue to ensure that it is correctly
calculated and in accordance with AASB
15;
• We selected a sample of revenue
transactions and agreed the transactions
to underlying supporting documentation;
• We performed audit procedures to
ensure that revenue is materially
complete, including procedures
surrounding cut-off at balance date; and
• We assessed the adequacy of the
Company’s disclosures in respect of
revenue and deferred revenue.
Information other than the financial report and auditor’s report thereon
The directors are responsible for the other information. The other information comprises the
information included in the Company’s annual financial report for the year ended 30 June 2021, but
does not include the financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives
a true and fair view in accordance with Australian Accounting Standards and the Corporations Act
2001 and for such internal control as the directors determine is necessary to enable the preparation
of the financial report that gives a true and fair view and is free from material misstatement, whether
due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the
Company 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 Company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
Page 61 of 66
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with Australian Auditing Standards will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
-
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
-
-
- Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Company’s ability to continue as a
going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial report or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and
events in a manner that achieves fair presentation.
-
We communicate with the directors regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable,
related safeguards.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on the Remuneration Report
Opinion on the remuneration report
We have audited the Remuneration Report included within the directors’ report for the year ended
30 June 2021.
In our opinion, the Remuneration Report of Spectur Limited for the year ended 30 June 2021
complies with section 300A of the Corporations Act 2001.
Page 62 of 66
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.
HLB Mann Judd
Chartered Accountants
Perth, Western Australia
30 August 2021
L Di Giallonardo
Partner
Page 63 of 66
Additional Securities Information
SHAREHOLDER INFORMATION
The security holder information set out below was applicable as at 13 August 2021.
There is one class of quoted securities, being fully paid ordinary shares.
1) Quoted Securities – (i) Fully Paid Ordinary Shares
a) Distribution of Security Number
Category
(Size of holding)
Ordinary Shares
Shareholders
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
39
78
126
483
203
929
Shares
6,273
243,118
1,020,890
19,201,126
85,833,873
106,305,280
There are 929 holders of ordinary shares. Each shareholder is entitled to one vote per share held.
b) Marketable parcel
There are 106 shareholders with less than a marketable parcel (basis price $0.10), with a total of 194,391 shares amounting
to 0.18% of issued capital.
c) Voting rights
On a show of hands every person present who is a member or a proxy, attorney or representative of a member has one
vote and upon a poll every person present who is a member or a proxy, attorney or representative of a member shall have
one vote for each share held.
d) Substantial Shareholders
There are no substantial shareholders listed on the Companies register as at 13 August 2021.
e) On market buy-back
There is no on-market buy-back scheme in operation for the company’s quoted shares.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 64 of 66
Additional Securities Information
SHAREHOLDER INFORMATION (continued)
f) Top 20 security holders
The names of the twenty largest holders of each class of quoted equity security, being fully paid ordinary shares, the number
of equity security each holds and the percentage of capital each hold is as follows:
Position
Holder Name
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
NATIONAL NOMINEES LIMITED
MR DUMINDA AMARAKOON & MRS GERALDINE AMARAKOON
CHARLES RICHARD WALLACE WILKINS
MR DARREN JOHN COOPER
DR MALAKA AMERATUNGA
MR PETER JOHN FERRIS
FACOORY INVESTMENTS (QLD) PTY LTD
MS SNEZANA BOWDEN
MR ANTON DE SILVA GUNAWARDENA & MRS THERESE SASHA MARIETTE
FERNANDO
GERARD JOHN DYSON
FRY SUPER PTY LTD
MR ALISTAIR CHARLES JACKSON
Holding
% Held
4,070,000
3.83%
3,650,000
3.43%
3,403,966
3.20%
2,503,879
2.36%
2,500,000
2.35%
1,849,480
1.74%
1,801,250
1.69%
1,600,000
1.51%
1,500,000
1.41%
1,462,179
1.38%
1,300,000
1.22%
1,300,000
1.22%
BNP PARIBAS NOMINEES PTY LTD
1,273,602
1.20%
MR GEORGE LIONTOS & MRS CRISTINA LIONTOS
MR SHAUN ROMESH ANTONY FERNANDO & MS WEI JUN LI
LEE NICOLA JOHN RINALDI & CAROL ANGUS RINALDI
1,263,645
1.19%
1,209,890
1.14%
1,185,000
1.11%
DR ROBIN BRUCE ENDERSBEE & MRS HELEN MARGARET ENDERSBEE
1,100,000
1.03%
MR MATTHEW JAMES BOWDEN
MR MATTHEW REGOS
CITICORP NOMINEES PTY LIMITED
Total
1,039,000
0.98%
1,036,949
0.98%
1,025,945
0.97%
36,074,785
33.94%
2) Unquoted Securities – Company Options and Performance Shares
There are two classes of unquoted securities, being Company Options and Performance Rights.
2A) Company Options
a) Distribution of unquoted Options holder numbers:
Position
Holder Name
1
2
3
4
SUZIE FOREMAN
FREDERIK MARE
NICHOLAS LE MARSHALL
ROBIN WALFORD
Total
Holding
% Held
500,000
22.73%
600,000
27.27%
800,000
36.36%
300,000
13.64%
2,200,000
100.00%
b) Voting rights
Unlisted options do not entitle the holder to any voting rights.
c) Holders of more than 20% of unquoted options.
There are no holders, holding more than 20% of the unquoted options on issue.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 65 of 66
Additional Securities Information
SHAREHOLDER INFORMATION (continued)
2B) Performance Rights
There are 8 holders of Performance Rights totalling 8,496,144
2C) Performance Rights
a) Voting rights
Unlisted Performance Rights do not entitle the holder to any voting rights.
b) Holders of more than 20% of unquoted Performance Rights
Gerard Dyson owns 4,909,806 performance rights which is equal to 57.8% of the Performance Rights on issue.
Further information including vesting conditions relating to the performance rights are contained in the
Remuneration Report.
OTHER ASX INFORMATION
1. Corporate Governance
A statement disclosing the extent to which the Company has followed the best practice recommendations set by the ASX
Corporate Governance Council during the year is contained in Appendix 4G.
This corporate governance statement lodged on the same day as the Annual Report is current as at the Company’s reporting
date and has been approved by the Board of the Company.
2. Stock exchange on which the Company’s securities are quoted:
The Company’s listed equity securities are quoted on the Australian Securities Exchange.
3. Restricted Securities
There are 418,988 ordinary shares held in voluntary escrow until 29/10/2021, as at the date of signing of the report.
Spectur Limited – Annual Financial Report – Year ended 30 June 2021
Page 66 of 66
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