ANNUAL
REPORT
Year ended 30 June 2022
2022
N
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S
S
I
M
Viva Leisure’s
mission is to
connect as many
people as possible
to a healthy
lifestyle, delivering
to its members an
uncompromising
fitness experience
via accessible,
affordable and
quality facilities
and services.
R
U
O
About this Report
This 2022 Annual Report for Viva Leisure Limited (ACN 607 079 792) has been prepared
as at 23 September 2022. Please note that terms such as Viva Leisure, VVA and Viva
Leisure Limited have the same meaning unless the context requires otherwise.
Viva Leisure is committed to reducing the environmental footprint associated with the
production of this annual report and printed copies are only posted to shareholders
who have elected to receive a printed copy. Shareholders can request a printed copy of
the Annual Report free of charge by emailing investor.relations@vivaleisure.com.au or by
writing to the Company Secretary, PO Box 1, Mitchell ACT 2911.
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AU DI TOR S IND EPEND ENCE D E CL ARAT I ON
RE MU NER ATI O N R EPO RT ( AUD IT E D)
CE O ’S RE PO R T
O UR PO RT FO LI O
2022 HI GHLI GHTS
D IR ECTO RS ’ REPO RT
A LET T ER FRO M T HE CHAI R
S O UR LO CATI O NS AND B RANDS
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Independent Auditor’s Report
Directors’ Declaration
SI GNED R EPO RTS
Notes to the Financial Statements
AD DI TI O NAL INFO RM AT IO N
FO R LI ST ED CO M PANI ES
CO RPO R ATE GOVE RNANCE STAT E M ENT
CO NSO LI DATE D FINANC IAL STAT EM E NTS
Consolidated Statement of Profit or Loss
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Shareholder Information
Corporate Directory
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3
5
7
9
13
23
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34
35
37
39
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43
77
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87
92
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+
334 LOCATIONS 0WNED
+ FRANCHISED
NEW
ZEALAND
2
INDIA
5
A
W
34
7
S A
5
Viva owned corporate locations,
includes 17 corporate owned
Plus Fitness locations.
Plus Fitness Franchise locations
Q L D
29 11
NS W
44
V I C
24
8
134
AC T
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3
3
Segment
Health Clubs
Boutique
Health Clubs
Boutique
Boutique
Boutique
Aquatics
High quality
facilities, mid
market price
point
High quality
facilities, mid
market price
point
Low cost,
low service
market
High quality
facilities, high
market price
point
Cycling
Niche Market
Medium
quality
facilities, mid
market price
point
Aquatics
$12-$25pw
$39-$45pw
$13-$16pw
$45-$75pw
$20-$25pw
$39-$45pw
Casual Entry
Target
Market
Target
Price
Point
Opened or
Aquired
Opened
Corporate
Locations
94
Franchised
Locations
Additional
Locations
Secured
8
Opened
Acquired
Opened
Opened
Acquired
Opened
25
To be
franchised
late CY2022
17
182
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2
To be
franchised
late CY2022
2
1 Corporate
20 Franchisee
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NETWORK MEMBERSHIPS 33.8%
320,161
OWNED LOCATIONS 31.3%
$90.8M
SREVENUE 8.5%
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334
151
$5.5M
EBITDA* 53.8%
ALL LOCATIONS 8.1%
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*Excludes the impacts of AASB-16.
5
REVENUE
($m)
Full Year
H1
H2
90.8m
83.7m
56.8m
47.8m
33.1m
40.9m
17.9m
24.1m
20.7m
18.4m
35.9m
34.0m
23.0m
EBITDA
($m)
Full Year
H1
H2
3.3m
1.8m
7.3m
6.1m
5.2m
11.9m
6.3m
5.6m
5.5m
9.3m
-3.8m
FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022
FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022
+7%
320,161
298,376
NETWORK
MEMBERS
EBITDA MARGIN
(%)
22.0%
21.6%
94,196
15.8%
54,039
10.0%
14.8%
14.3%
6.0%
26,754
29,124
35,631
FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022
FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022
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Dear Fellow Shareholders
• Viva Leisure corporate owned club membership
increased by over 33,500 members;
M EET I NG T HE CHALL ENGES
• The corporatisation of 12 additional Plus Fitness
On behalf of the Board, I am pleased to present the Viva
Leisure Limited 2022 Annual Report.
Like many businesses VIVA’s operations were again
severely impacted by the effects of COVID-19, and the
pandemic has now impacted the last three financial
years. Despite this, the Company rebounded quickly
in the second half to not only recover the pre-COVID
membership and revenue metrics, but to exceed them,
reflecting the loyalty of our membership base and their
desire of the to re-establish fit and healthy lifestyles.
Our recent Bi-Monthly presentation announcements
demonstrate the recovery and improvement of the
business on all key metrics and sets a good platform for
the year ahead.
During the first half of 2022 our staff have endured the
difficulties related to further Government mandated
closedowns, re-openings, and further closedowns. We
do not underestimate the personal toll on our staff, all of
whom have shown resilience and understanding during
this period. For that we say thank-you.
The continued support of our shareholders is best
illustrated by the success of our capital raise early in
FY2022 during a period of intermittent club closures
and uncertainty. This support is appreciated and is an
endorsement of the Company’s longer term objectives of
growth and growing shareholder return.
Important highlights in the COVID-19 affected results were:
• Total revenues were $90.8 million compared with $83.7
million in the financial year ended 30 June 2020, an
increase of 8.5%;
franchised clubs demonstrating the opportunity for the
Company to take advantage of the acquisition pipeline.
SO C IAL AND COM M UNI TY COM MITM EN T
Viva Leisure has again continued its commitment to
ongoing support of the local communities in which we
operate. That contribution has continued to be necessarily
moderated in 2022 by the impact of the pandemic. The
Company continues to strive to be a responsible
corporate citizen.
B OARD AND M ANAGE ME NT
I am delighted that Louise Bolger joined the Board in July
2021 and Andrew Burns in April 2022. Both Louise and
Andrew have deep corporate and commercial experience
and have made a valued contribution since their
appointments.
The Board and I appreciate the manner in which our
CEO Harry Konstantinou and the executive team have
navigated through the difficulties posed by the continual
disruption of the COVID-19 pandemic. The continued
positivity and sustained determination to continue to
strive for the strategic corporate vision, despite these
roadblocks, is a testament to Harry, the executive team,
and the entire Viva Leisure team of over 1,600 employees.
This was encapsulated in a significant result in the second
half, not only exceeding the pre-COVID key metrics but
also setting a robust platform for future financial years.
• Earnings before Interest, Tax, Depreciation and
B RU CE GLANVI LL E
Amortisation (EBITDA) improved from a loss in the
first half of ($3.8 million) to a gain of $9.3 million in
the second half (full year of $5.5 million) compared
with $12.0 million in the previous year, excluding the
impacts of AASB16;
D IV ID ENDS
As set out in the report to shareholders last year and,
as foreshadowed in the 2019 Prospectus, reflecting
Viva Leisure’s growth profile and continuing investment
opportunities, the Directors confirm that no dividend will
be paid in respect of the 2022 Financial Year.
O PER AT ING H IGHLI GHTS FOR TH E Y EA R
Highlights for the year were:
• An increase in corporate owned operating locations/
clubs from 115 to 151, comprising 12 new Greenfield
locations, and 25 new clubs acquired from 16 separate
acquisitions;
• The opening of two Groundup locations, establishing a
new concept which represents first class Yoga, Pilates
and Barre formats;
It was with great sadness that our fellow Board member
and Chair, Mr Bruce Glanville passed away unexpectedly in
April 2022. Bruce was the founding Chair of the Company
in addition to being a trusted advisor to the business for
many years prior to listing.
He will be remembered as a dedicated stalwart of the
Company, who’s drive, dedication, commitment and
leadership permitted the Company to expand in a
controlled and appropriate manner to where it is today.
On behalf of the Board and the Company we acknowledge
Bruce for his incredible work and dedication to Viva
Leisure during such important formative years.
In closing, I extend the gratitude of the Board to our
shareholders, our team, and our members for their
continued support throughout this most challenging year.
Yours sincerely,
R H Y S H O L L E R A N
Chair
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Dear Fellow Shareholders,
As I write this in September 2022, my fourth report as
CEO, it is encouraging to not be in lockdown due to
COVID-19 as was the case with the previous two financial
years. Whilst COVID-19 also affected the first half of the
2022 Financial Year, the second half was our best half year
of trading, and the start of the 2023 Financial Year has
been even more encouraging.
Since listing in June 2019, the business has not had
the opportunity to operate a full 12 months without
interruptions, however we have used the period to
further improve business structures and synergies
which has made us stronger for the future.
Viva has achieved some significant milestones during
the year, and with the feeling from consumers to live
a healthier lifestyle due to the pandemic over the past
two and a half years we expect to see the growth in
memberships and daily visits by members continue to
increase as it has every month since re-opening. As I
mentioned in my CEO letter last year, the importance of
a healthy lifestyle has never been more important than
living through a pandemic, and I truly believe that this
now resonates with more and more members of our
community.
Key highlights for the year included:
• Direct membership increased 26.6% to 159,546
members, and total membership across all locations
increased to 320,161;
• Locations increased 31.3% to 151, adding a further 36
locations during the year, essentially one new location
joined the Viva Leisure network every 1.4 weeks of
the year;
• Revenue increased to $90.8 million, an increase of
8.5%; Revenue for H2-FY2022 was $56.8 million
(62.5% of the annualised revenue due to the
lockdowns in H1-FY2022);
• EBITDA was $5.5 million (excluding the impacts
of AASB-16) for the full year, however, again was
supported by a strong H2-FY2022 which recorded
$9.3 million in EBITDA; and
• June 2022 annualised revenue run rate at
$124.5 million.
OVE RVI EW
The year was definitely a story of two halves. The first half
of the Financial Year was affected by significant lockdowns
which had a direct effect on revenue and thus profitability.
However, the second half provided a clear run, and with
the direct debit nature of our business quickly recovered
revenue and thus profitability with an outstanding result.
Viva Leisure owned and operated 151 locations as of 30
June 2022 (FY21: 115). As of the date of this report, this
has increased to 153 locations. This represents an increase
of 124 locations in 40 months since our IPO in June 2019.
To put this into perspective, this equates to a new location
opening or acquired every nine-and-a-half days since
we listed.
Together with new club openings and acquisitions during
the year, our existing like-for-like locations continued
to grow membership and visitations which are two key
metrics that we constantly monitor. At 30 June 2022, our
like-for-like locations which were open in February 2020
(pre COVID-19 pandemic) had 100% fully recovered and
were 3% up in membership, and 8% up in revenue when
compared to pre COVID-19 numbers.
The second GroundUp boutique Pilates, Yoga and Barre
studio during the year with further locations currently
being planned. The GroundUp concept builds on our
unique hub and spoke approach to fitness where one size,
service and product does not fulfil all members needs
and requirements. The average revenue per member per
week for a GroundUp membership is approximately $50,
and with over 900 members in our two operating studios
provides an excellent return on investment.
Our Plus Fitness brand continues to improve with
Systemwide sales now in excess of $95.5 million, which
highlights the strength of the franchise network. Whilst
franchise locations has been steady at approximately
200 locations, the management team at Plus Fitness has
worked hard to improve the profitability of each franchisee
which again helps to strengthen the network and will start
to pay dividends as they reinvest into their locations with
an improved member experience and look and feel of the
clubs. During the year our new Plus Fitness branding was
also launched.
AVER AGE REV ENUE PER M EM BER PE R WE E K
AND U TI LI SAT IO N
My team and I have paid special attention over the past
year to growing the Average Revenue Per Member
(ARPM) per week which now sits at $14.59 (June 2022), up
from $13.79 (June 2021). The ARPM is expected to exceed
$15.00 from the end of Q1-FY2023.
Together with increasing ARPM, Utilisation, which is a
measure of capacity within our individual facilities has
continued to increase from a low of under 60% during
COVID, to now average over 69.3% (June 2022) across the
portfolio. August 2022 saw this increase to over 70.2%.
Improving utilisation rates across the portfolio drives
increased margin due to limited additional costs to add
new members to an already operating location.
These two metrics will continue to be a focus for our team
in FY2023 as we target a long term utilisation average
of between 75-80% across the entire portfolio of mature
locations (ie: older than 12 months).
M EM B ERS HIP
Network Membership (Corporate and Franchisee
locations) increased 7.3% during the year to 320,161
members (FY21: 298,376). Direct Membership at
corporate owned locations increased 26.6% to 159,546
(FY21: 126,006).
Direct corporate members provide greater revenue
and profitability over franchised members and with the
membership as of 30 June 2022 now split evenly between
franchisee members (50%) and direct corporate owned
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Viva Labs builds
software & hardware
to help our members
build better bodies
and lifestyles.
The Viva Labs team is the technology division of Viva Leisure responsible for ensuring Viva
operates at the forefront of fitness and technology.
The team is responsible for our websites (both front and back of house), membership systems,
the Viva Pay direct debit processing system, designing and building hardware and software to
support the business as well as smart phone applications.
With a member visiting one of our facilities every 1.3 seconds of the day (August 2022),
technology is an important aspect of our business to ensure a smooth member experience.
We are more than just a fitness business.
members (50%) this will start to provide additional
benefits in FY2023. This increase in direct corporate
owned members is up from 42% in the previous year.
Membership visits for June 2022 were 1.7 million, or
put simply, a member visited either a corporate owned
location or franchised location every 1.5 seconds of
the day.
TALEN T
To support our ambitious future growth, and as we
have done in the past, our executive team is focused on
attracting the best possible talent, as well as retaining,
fostering and offering growth opportunities to our already
bright shining stars. Viva Leisure offers a unique career
path for anyone who wishes to work in the fitness industry
and nearly all of our senior management have come
through the ranks and worked their way up. Our business
is all about experiences, and these can only be offered
sincerely when we have the very best, working in harmony.
Our team is highly motivated, excited, and constantly
educating and adapting to remain at the forefront.
ACQUISITIONS
During the financial year, we negotiated, settled and more
importantly, integrated various acquisitions. In total we
acquired 25 new locations, plus the master franchisor of
the Rebalance Pilates and Yoga group. We now own 17
corporate Plus Fitness locations in line with our strategy of
corporatizing appropriate locations within the Plus Fitness
network, which was one of the key drivers in acquiring the
master franchisor rights in 2020.
VIVA LAB S A ND TECHNOLOGY
We have continued to invest in our technology. Our
Viva Labs team which builds our software, hardware and
smart phone applications all in-house has continued to
expand as we look to continue leading the fitness market
in creating frictionless joining, membership management,
portfolio/brand access and access control experiences
unmatched by any other fitness provider in the world.
Over the next financial year, we will undertake our largest
investment in technology upgrades since the business was
launched some 18 years ago. We are in the final stages
of deploying our door access technology into our Plus
Fitness network which will provide our franchisees with
more revenue opportunities and save on costs at the
same time.
THE FUTURE
The future, while extremely exciting, will continue our
‘more of the same’ model. A model which we have proven
over the past 18 years since we opened our first location.
Viva Leisure is committed to continue and even accelerate
our strategic, controlled and well-planned growth
trajectory in all key market segments in which we
operate and potentially some new markets we are
currently exploring.
We continue to be the only provider with a combination
of brands available to us which are suitable in all markets
and all price-points, which is something our competitors
simply do not offer nor can easily replicate. We are a
dynamic business that can pivot, adapt and grow in my
opinion faster than any other player in the market, both in
Australia and internationally.
I expect in the coming twelve months we will capitalise on
our ability to effectively scale nationally without impacting
our margins due to the foundations we have established
over the past few years.
I look forward to leading the team into the next period
of growth, continuing to extend our services into more
markets, increasing the opportunities for our team and
growing the value of the company for our shareholders.
It is encouraging to see so many of our members as
shareholders of the business.
BRUCE GLANVILLE
In April 2022, our founding Chair Mr Bruce Glanville
passed away unexpectedly. Bruce was a trusted advisor
and mentor to me personally and the rest of the executive
management team. I had worked with Bruce on and off
for over 20 years in multiple business ventures. Without
Bruce’s persistence, experience, contacts and guidance
the business would not be where it is today. He believe as
much as I did on the path of listing the business on the
ASX, and on the goal of becoming not only the largest but
the most profitable health club operator in all the markets
in which we serviced.
He will be deeply missed as both a personal friend and
mentor, and as the Chair of Viva Leisure.
Bruce, thank you for everything, and rest in peace that
your legacy and the foundations you established will
live on.
H A R R Y K O N S T A N T I N O U
Founder, Managing Director and Chief Executive Officer
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The Directors of Viva Leisure Limited present their
report together with the financial statements of the
consolidated entity, being Viva Leisure Limited and
its controlled entities (the Group) for the financial
year ended 30 June 2022.
1 3
RH YS HOL LER AN
Independent Chair
Appointed 20 April 2022
Independent Non-Executive Director
Member of the Audit and Risk Committee
Member of the People and Culture Committee
Appointed 30 September 2020
Qualifications
Bachelor of Economics and Member of Certified
Practising Accountants Australia
Experience
Appointed Board and Committee member on 30
September 2020.
Rhys has 30 years of executive management expertise
ranging from micro-cap to ASX 200 companies in
the media sector including as Chief Executive of two
public listed companies - RG Capital Radio Limited
(ASX:REG) and Macquarie Media Group (ASX:MMG,
now ASX:SXL)
Other Current Directorships
None
Directorships held in other listed entities during the
three years prior to the current year
None
Interest in Shares and Options
30,000 ordinary shares.
HARRY KONSTANTINOU
LOUISE BOLGER
Managing Director and Chief Executive Officer
Appointed 15 July 2015
Independent Non-Executive Director
Appointed 5 July 2021
Member of the Audit and Risk Committee
Member of the People and Culture Committee
Appointed 12 October 2018
Qualifications
BA, (University of Canberra)
Member of Australian Institute of Company Directors
Experience
Company co-founder and Director since 2004.
Harry has over 25 years of experience developing,
managing and selling technology services business.
Chair of the People and Culture Committee
Qualifications
Bachelor of Laws (Hons)
Bachelor of Arts
Bachelor of Education
Experience
Louise is an experienced telecommunications, media
and technology lawyer and company secretary
having held Director, General Counsel and Company
Secretary roles with various ASX listed companies.
Her experience as a non-executive director extends to
listed and not-for-profit organisations.
Other Current Directorships
None
Other Current Directorships
None
Directorships held in other listed entities during the
three years prior to the current year
None
Directorships held in other listed entities during the
three years prior to the current year
Superloop Limited (ASX: SLC) resigned 23 November
2018
Interest in Shares and Options
23,386,701 ordinary shares and options to acquire a
further 3,163,000 ordinary shares.
Interest in Shares and Options
14,000 ordinary shares
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ANDREW B UR N S
KYM GALLAGHER
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Independent Non-Executive Director
Appointed 20 April 2022
Chair of Audit and Risk Committee
Member of People and Culture Committee
Qualifications
Bachelor of Commerce
Executive Masters of Business Administration
Member of Chartered Accountants ANZ
Member of Australian Institute of Company Directors
Experience
Andrew has over 25 years’ experience in senior
leadership roles and has significant ASX experience.
He is currently employed as CFO of Racing and
Sports Limited (ASX:RTH) and has undertaken CFO
roles for Openpay Ltd (ASX:OPY), where he led the
finance function through its IPO in 2019 and multiple
subsequent capital raises, and The Citadel Group
Limited (ASX:CGL), where he undertook the role
of CFO for 11 years. Andrew has strong technical
competencies in financial management, accounting
and process improvement techniques with a focus in
B2B technology and businesses.
Other Current Directorships
None
Company Secretary and Chief Financial Officer
Appointed 12 October 2018
Qualifications
Bachelor of Economics,
Member of Chartered Accountants ANZ
Experience
Kym has considerable experience as the CFO and
other senior management roles of numerous ASX
listed companies, commencing with RG Capital Radio
(ASX:REG) in 2000, followed by Macquarie Media
Group (ASX:MMG) in 2005 and Southern Cross Media
(ASX:SXL) in 2010
Other Current Directorships
None
Directorships held in other listed entities during the
three years prior to the current year
None
Interest in Shares and Options
140,000 ordinary shares and options to acquire a
further 476,667 ordinary shares.
Directorships held in other listed entities during the
three years prior to the current year
None
RETIRED DIRECTORS
Interest in Shares and Options
67,686 ordinary shares
1 5
BR UCE GLANV ILLE
Independent Non-Executive Director
Independent Chair
Member of the Audit and Risk Committee and
People and Culture Committee until retirement
Appointed 12 October 2018
and ceased 7 April 2022
PR INC IPA L ACTIVITIES
The principal activities of the consolidated group during
the financial year were the operation of health club
services. No significant change in the nature of these
activities occurred during the year.
R EVIEW OF OPERATIONS AND FINANCIAL
R ESULTS
Financial highlights for the year:
• Total revenues were $90,831,726 compared with
$83,718,105 in the financial year ended 30 June 2021;
• Loss before income tax was $17,140,726, compared to a
loss of $8,793,735 in the financial year ended 30 June
2021;
• Net loss After Tax (NPAT) from continuing operations
and attributable to members was $12,141,191 compared
with a financial year ended 30 June 2021 loss of
$6,384,898;
• Cash and cash equivalent reserves is strong at
$10,069,569, down from $17,290,971 in the financial
year ended 30 June 2021; and
• There was a decrease in net assets to $85,809,917
compared to $86,352,203 in the financial year ended
30 June 2021
Operational highlights for the financial year:
The onset of the Omicron variant then led to a reluctance
of members to attend our facilities, suppressed the rate of
new members joining and led to an increase of voluntary
suspensions by existing members.
Over the period to 30 June, the Viva Group delayed the
works on several of its greenfield locations to preserve
cash in the uncertain COVID environment, whilst in many
cases carrying full rent costs. These delays have deferred
club openings into late in the second half of FY2022 and
into FY2023.
SIGNIFI CANT CHANGES IN THE
STATE OF AFFAIRS
During the year, the following significant changes occurred
within the Group:
• Completed 16 separate acquisitions (25 clubs)
comprising:
• 12 Plus Fitness sites in Manly, Mona Vale,
Rydalmere, and St Marys in NSW; Beerwah, Qld;
and Alkimos, Baldivis, Dalyellup, Halls Head,
Lathlain, Melville and Mt Lawley, WA
• The assets of One Health South Morang, Vic and
Live Well Gregory Hills, NSW
• The Master Franchise of the Rebalance Group and
assets of the corporate owned sites comprising
eight Yoga/Pilates studios in Qld, NSW and Vic
• The assets of My Fitness Clubs in Broadbeach,
• An increase in operating locations/clubs from 115 to 151;
Noosaville and Sippy Downs, Qld
• Corporate member numbers increasing from 126,006
at June 2021 to 159,546 at 30 June 2022;
COVID-19 Impacts
• Completed a fully underwritten $11.7m equity raising
(before transaction costs) by way of an institutional
placement of approximately 7.56m ordinary shares at
$1.55
Viva Leisure Limited’s clubs were subjected to significant
closures during the period of July to October 2021.
• Opened 12 new greenfield sites:
The Company took immediate steps to mitigate exposure
to ongoing costs and to preserve cash:
• Wage costs reduced significantly by the stand down
of significant numbers of staff during this period of
closure,
• Rent relief negotiations commenced with landlords for
• Six Club Limes in Castle Hill, NSW; Maroochydore
and Nundah, QLD; Ballarat, Coburg and
Brunswick, Vic
• Three Hiit Republics in Redcliffe, QLD; Coburg
and Ballarat, Vic
• Plus Fitness in Tuggeranong, ACT
the period of shutdown
• Two GroundUps in Belconnen and Yarralumla ACT
• Delayed all un-committed capital works on rollouts
• Closed one site in Shellharbour, NSW
• Funding received through the NSW JobSaver Grant
• New credit terms were agreed with the
• Undertook a capital raise to further preserve the cash
position
During this period, the Group suffered a significant
reduction in revenues, which in turn has affected profits
for the period.
In addition, the Plus Fitness business suffered a reduction
in Franchise Fees (clubs closed by reason of government
direction) and lower than normal territory rollouts due to
uncertainty across the sector.
Commonwealth Bank of Australia in relation to
a $63.27 million five-year senior secured facility,
comprising a $42.17 million Market Rate Loan facility
(currently drawn to $20.13 million) to assist in financing
future acquisitions, a bank guarantee facility and a
direct debit facility
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EV ENTS SUB S EQ UENT TO TH E END O F TH E
RE PO RT ING PE RI O D
Since the end of the financial year, the Company has
entered into binding agreements or completed the
following acquisitions:
• Plus Fitness, Hocking, WA
Mitigation Strategies
• Ensure that the Company is up to date with current
regulatory matters and decisions.
• Continuous business development and member
growth to increase member numbers and utilisation
rates.
No other matters or circumstances have arisen since the
end of the financial year which significantly affected or
may significantly affect the operations of the consolidated
group, the results of those operations, or the state of
affairs of the consolidated group in future financial years,
other than the impacts of COVID-19 mentioned above.
LI KELY DE VELO PM ENTS AND E XPE CT ED
RE SU LTS O F OPE RAT IO NS
Likely developments in the operations of the consolidated
group and the expected results of those operations in
future financial years have not been included in this report
as the inclusion of such information is likely to result in
unreasonable prejudice to the consolidated group.
RISK STATEMENT
The Group is committed to the effective management of
risk to reduce uncertainty in business outcomes and to
protect and enhance shareholder value.
There are a number of risks that could have a material
financial impact on the Group; these risks and their
mitigation strategies are outlined below:
Covid-19
The Group has considered the impacts that the
Coronavirus (COVID-19) pandemic has had, or may
have, on the group 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 group operates. During
the first half of the financial year, the Group had its clubs
closed across all states and the ACT at various times due
mandatory shutdowns imposed by the respective State
Governments and there remains uncertainty with respect
to future events or circumstances which may continue to
impact the financial results of the consolidated entity.
Mitigation Strategies
• Stand down of staff where appropriate
• Negotiate rent relief with landlords
• Delay of capital works to preserve cash
Regulatory risk
If there is a change in any applicable industry regulations,
franchising laws or temporary changes legislation such as
the shutdown requirements employed through Covid-19
pandemic response (see above), the Group may be
affected through additional compliance costs or the
inability to provide certain services. This could result in the
loss of revenue and customers through lower utilisation
and site shutdowns, which may adversely affect the
Company’s financial position and performance.
Protection of intellectual property
The Group maintains many intellectual property assets
and risks associated with our IP include the risk that
employees or other third parties will breach confidentiality
agreements, infringe, or misappropriate the Company’s
intellectual property or commercially sensitive information.
Mitigation Strategies
• Ensure that contractual agreements with employees
and third parties include appropriate IP protections,
including indemnity clauses.
• Administration access limited to select employees.
Disruption risks
Disruption risks for the Group include service outages,
inability to handle unanticipated levels of demand
during peak times or events, computer viruses, misuse
by employees or contractors, or external or malicious
interventions, such as hacking. Any disruption or failure of
the Groups technology or systems may adversely affect
the Company’s operations, achievement of objectives and
ultimately, its financial position.
Mitigation Strategies
• Ensure suppliers providing technology services to the
Company are reputable and have robust mitigation
strategies to manage any issues effectively.
• Continuous monitoring of traffic site, regular server
testing and upgrading to handle increasing traffic.
• Redundancies and data backup for all key technology
systems.
• 24-hour technology coverage of the website and
technology assets to ensure issues are dealt with
promptly.
Privacy breaches
Cyber-security incidents may compromise, or breach
technology and service platforms used by the Company
as part of its ongoing business and result in disclosure of
personal or confidential information about the Company,
its customers, employees or third parties in breach of
Privacy Act 1988 (Cth) (Privacy Act) and the Australian
Privacy Principles (APPs). This could result in loss of
data integrity, reputational damage to the Company,
claims from affected parties, loss of customers, increased
regulatory scrutiny or regulatory action.
Mitigation Strategies
• Application of Privacy Principles to the management
of personal data.
• Appropriate security regarding use of, and access to,
personal data in accordance with the Privacy Act.
•
IT security measures such as firewalls, alerts for
unauthorised access and encryption of data when it is
being transmitted.
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Domestic and Global Economic Conditions
acquisition capability.
UNI SSUE D SHAR ES UND ER O PT IO N
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The Group is subject to risk related to the volatility of
domestic and global economic, political, and social
conditions. The uncertainties and recent downturn of
the global economy and other macroeconomic factors,
including but not limited to the ongoing COVID-19
pandemic, wars, geo-political instability, supply chain
interruptions, and inflation could adversely affect our
business.
Domestic Economic Conditions:
Domestic economic conditions including inflation and
increases in the cost of living may have an impact on
the Group through pressure to increases in wages and
reduced members.
Global Economic Conditions:
Global economic conditions may have an impact on
the Group through the sourcing of equipment and
consumables in support of the current and future
operations. The impact to the group may be through
increased prices and disruptions to supply chain.
Mitigation Strategies
•
Increased domestic global costs may be directly
passed on to the customer through periodic
price increases.
• Wage growth is actively managed using appropriate
application the Fair Work Act and a proactive talent
• Global supply chain risks are mitigated through
advanced planning for new and refurbished sites
taking in to account the potential for supply
chain disruptions.
Interest Rate Risk
The Group is exposed to interest rate risks as outline
in Note 32. The interest rate risk is limited to the
outstanding borrowings with variable interest rates. The
groups Equipment Lease Liabilities, which account for
approximately 49% of the Group’s external debt, have
predominantly fixed payments and fixed interest rates so
there is no material underlying risk to the financials of the
business.
Mitigation Strategies
• The group continually assess the weighted average
cost of debt against the cost of capital to determine
the most appropriate use of free cashflow
from operation.
DIRECTORS’ MEETINGS
The number of meetings of the Board (including meetings
of Committees of Directors) held during the year and
the number of meetings attended by each Director is as
follows:
Director’s name
Board Meetings
Audit and Risk Committee
People and Culture
Committee
A
16
14
16
16
1
B
16
14
16
16
1
A
4
3
4
0
4
B
4
3
4
3
4
A
5
3
5
5
2
B
4
3
5
5
2
Harry Konstantinou
Bruce Glanville*
Rhys Holleran
Louise Bolger#
Andrew Burns^
#Appointed 5 July 2021
*Ceased 7 April 2022
^Appointed 20 April 2022, Andrew attended 3 of the 4 ARC meetings as the independent chair prior to being appointed as a Director.
Where:
• column A: is the number of meetings the Director was entitled to attend
• column B: is the number of meetings the Director attended
During the year, there were 7 scheduled Board Meetings. The additional meetings held and attended by Directors were
for special matters, such as for acquisitions, capital raises and COVID-19 matters.
Unissued ordinary shares of the Company under option at the date of this report are:
Date options granted
Expiry date
Exercise price of shares
($)
Number under option
2-May-19
2-May-19
30-Oct-19
12-Nov-20
28-Oct-21
2-May-23
2-May-23
31-Aug-24
16-Oct-25
16-10-24
1.34
1.43
0.00
3.34
0.00
1,400,000
1,000,000
295,000
1,213,334
412,000
4,320,334
These options were issued under either the LTI, Tranche 1 or Tranche 2 Plans (described in Note 20.2 to the financial
statements) and have been allotted to individuals on conditions as follows:
• LTI Plan Options: The vesting of those options and will be subject to the satisfaction of appropriate service-based
conditions and/or performance hurdles determined by the Board. Options issued under the LTI program expire on
the earlier of their expiry date or termination of the employee’s employment;
• Tranche 1 and Tranche 2 Plan Options: The options are currently vested. Options issued under the Tranche 1 and
Tranche 2 program expire four years from the date of grant of the options.
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SHAR ES ISSU ED D UR ING O R S INC E T HE E ND
O F T HE Y EAR AS A RES ULT O F EX ERC IS E
O F O PT IO NS
or the improper use by the officers of their position or of
information to gain advantage for themselves or someone
else to cause detriment to the Group.
There were no issued ordinary shares as a result of the
exercise of options during the financial year.
ENV IR ONM ENTAL LE GIS LAT I ON
The consolidated group’s operations are not subject to
any particular or significant environmental regulation
under a law of the Commonwealth or of a State or
Territory in Australia.
D IV ID ENDS
There were no dividends paid or declared since the start
of the financial year (2021: nil).
INDEMNITIES GIVEN TO, AND INSURANCE
PREMIUMS PAID FOR AUDITORS AND OFFICERS
Insurance of Officers
During the year, Viva Leisure paid a premium to insure
officers of the Group. The officers of the Group covered by
the insurance policy include all Directors and Secretaries.
The liabilities insured are legal costs that may be incurred
in defending civil or criminal proceedings that may be
brought against the officers in their capacity as officers
of the Group, and any other payments arising from
liabilities incurred by the officers in connection with such
proceedings, other than where such liabilities arise out of
conduct involving a wilful breach of duty by the officers
Details of the amount of the premium paid in respect of
insurance policies are not disclosed as such disclosure is
prohibited under the terms of the contract of insurance.
The Group has not otherwise, during or since the end of
the financial year, except to the extent permitted by law,
indemnified or agreed to indemnify any current or former
officer of the Group against a liability incurred as such by
an officer. No indemnities have been given or insurance
premiums paid, during or since the end of the financial
year, for any person who is or has been an officer or
auditor of the consolidated group.
Indemnity of officers
The Company has entered into deeds of access, indemnity
and insurance with each Director (Director’s Protection
Deed) which confirm and extend the Director’s statutory
and general law rights of access to Board papers and the
books and records of the Company and its Subsidiaries.
The Director’s Protection Deeds provide that the
Director be allowed access to and a copy of records
in certain circumstances.
In accordance with the Constitution, the Company must
indemnify any current and former Directors and officers
of the Company and its Subsidiaries against any liability
incurred by that person in that capacity, including legal
costs. The Director’s Protection Deed also requires the
Company to indemnify the Director for liability incurred as
an officer of the Company and its Subsidiaries, including
reasonably incurred legal costs, to the maximum extent
permitted by law.
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The Constitution also allows the Company to enter into
and pay premiums on contracts insuring any liability
incurred by any current and former Directors and officers
of the Company and its Subsidiaries, which is incurred by
them in that capacity, including legal costs.
Accordingly, the Director’s Protection Deed requires the
Company to maintain, to the extent permitted by law,
an insurance policy which insures Directors and officers
against liability as a Director or officer of the Company
and its Subsidiaries.
PROCEEDINGS ON BEHALF OF TH E
CONSOLIDATED GR OUP
No person has applied for leave of Court to bring
proceedings on behalf of the consolidated group or intervene
in any proceedings to which the consolidated group is a
party for the purpose of taking responsibility on behalf of the
consolidated group for all or any part of those proceedings.
The consolidated group was not a party to any such
proceedings during the year.
Indemnity of auditors
AUD ITOR’S IND EPEND ENCE DE CL ARATI ON
The Group has agreed to indemnify its auditors, Hall
Chadwick, to the extent permitted by law, against any
claim by a third party arising from the Group’s breach
of its agreement. The indemnity requires the Group to
meet the full amount of any such liabilities including a
reasonable amount of legal costs.
A copy of the auditor’s independence declaration as required
under section 307C of the Corporations Act 2001 is set out
on page 32.
This directors’ report including the Remuneration Report
is signed in accordance with a resolution of the Board
of Directors:
H A R R Y K O N S T A N T I N O U
D i r e c t o r
Dated this
17 day of August 2022.
Non-audit services
During the year, Hall Chadwick, the Company’s auditors,
performed certain other services in addition to their
statutory audit duties.
The Board of directors has considered the position and,
in accordance with the advice received from the audit
committee, is satisfied that the provision of the non-
audit services is compatible with the general standard of
independence for auditors imposed by the Corporations
Act 2001. The directors are satisfied that the provision of
non-audit services by the auditor, as set out below, did not
compromise the auditor independence requirements of
the Corporations Act 2001 for the following reasons:
• All non-audit services have been reviewed by the
audit committee to ensure they do not impact the
impartiality and objectivity of the auditor; and
• None of the services undermine the general principles
relating to auditor independence as set out in APES
110 Code of Ethics for Professional Accountants.
Details of the amounts paid to the auditors of the
Company, Hall Chadwick, for audit and non-audit services
provided during the year are set out in Note 26 to the
financial statements. The total paid for non-audit
services was $40,275. This comprised tax and other
business services.
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VIVA LEISURE ANNUAL REPORT 2022
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a. Principles used to determine the nature and amount of remuneration
b. Details of remuneration
c. Service agreements
d. Shared-based remuneration
e. Shares held by directors and key management personnel
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The Directors of Viva Leisure Ltd (Viva Leisure, the Group,
or the Company) present the Remuneration Report for
Non-Executive Directors, Executive Directors and other
Key Management Personnel, prepared in accordance
with the Corporations Act 2001 and the Corporations
Regulations 2001.
The Remuneration Report is set out under the following
main headings:
a. Principles used to determine the nature and
amount of remuneration;
b. Details of remuneration;
c. Service agreements; and
d. Share-based remuneration
A. PRI NCI PLES U SED TO DE T ERM I NE T HE
NAT UR E AND AMO UNT OF R EM UNE RATI O N
The principles of the Group’s executive strategy and
supporting incentive programs and frameworks are:
• to align rewards to business outcomes that deliver
value to shareholders;
• to drive a high performance culture by setting
challenging objectives and rewarding high performing
individuals; and
• to ensure remuneration is competitive in the relevant
employment market place to support the attraction,
motivation and retention of executive talent.
Viva Leisure has structured a remuneration framework that
is market competitive and complementary to the reward
strategy of the Group.
The Board has established a People and Culture
Committee which operates in accordance with its
charter as approved by the Board and is responsible for
determining and reviewing compensation arrangements
for the Directors and the Executive Team.
The Committee has engaged independent remuneration
consultants as necessary to provide any information to
assist in the discharge of its responsibilities (refer to the
disclosures below).
The remuneration structure that has been adopted by the
Group consists of the following components:
• short term incentives (STIs), being cash
based payments;
•
long term incentives (LTIs), being participation in
the form of options.
The People and Culture Committee assess the
appropriateness of the nature and amount of
remuneration on a periodic basis by reference to recent
employment market conditions with the overall objective
of ensuring maximum stakeholder benefit from the
retention of a high quality Board and Executive Team.
The payment of share options and other incentive
payments are reviewed by the People and Culture
Committee annually as part of the review of executive
remuneration and a recommendation is put to the Board
for approval. All incentive salaries, options and incentives
are linked to pre-determined performance criteria, and
subject to the usual discretion of the Board.
Short Term Incentives (STIs)
Performance measures involve the use of annual
performance objectives, metrics, performance appraisals
and continuing emphasis on living the Company values.
The performance measures are set annually after
consultation with the Board and executives and are
specifically tailored to the areas where each executive has
a level of control. The measures target areas the Board
believes hold the greatest potential for expansion and
profit and cover financial and non-financial measures.
Entitlement to an annual STI payment for the Executive
Team is subject to the following:
• the achievement of targets as against key
performance indicators (KPIs) and the budget
adopted by the Board for the financial year ending 30
June of each year;
• an unqualified audit report for that financial year;
• the People and Culture Committee will assess whether
those KPIs have been achieved or otherwise and
provide a recommendation to the Board;
• where the KPIs are only partially achieved, the Board
will, wholly at its sole discretion, determine the basis
upon which any STI payment will be calculated in
those circumstances; and
• fixed remuneration being annual salary including
• any STI amount is only payable upon finalisation of the
directly related statutory obligations;
financial accounts by the Company.
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Long Term Incentives (LTIs)
The table below describes the performance hurdles and vesting conditions that apply as at the date of this report and in
relation to the 1,920,334 options granted to senior executives:
Earnings per Share (EPS) and Total Shareholder Return (TSR) Cumulative Compound Annual Growth Rate (CAGR)
• for the options granted on 28 October 2021, TSR means Total Shareholder Return and will be measured using the
VVA 15-day Volume Weighted Average Market Price (VWAP) for the fifteen (15) trading days commencing from
the announcement of results for the financial year ended 30 June 2021 (TSR measure start date) to the same 15
trading period VWAP post the date of announcement of results for the year ended 30 June 2024 (TSR measure
end date);
• The Basic EPS may be adjusted for items which the Board, in its discretion, considers should be excluded from the
The percentage of options that vest for each EPS and TSR CAGR is illustrated in the following tables:
EPS result (such as items of a one-off and non-recurring nature).
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LTIs (Granted 30 October 2019)
EPS CAGR over the three Financial Years Ending 30 June 2022
Percentage of Options that Vest
Less than 15% (minimum Target)
0%
15% to 20% (within target range)
50% - 100%
(on a straight-line basis)
Greater than 20% (above maximum target)
100%
LTIs
(Granted 12 November 2020)
Tranche 1 (50% of Options
– based on EPS CAGR)
Tranche 2 (50% of Options
– based on TSR CAGR)
CAGR over the three Financial
Years Ending 30 June 2023
Percentage of Options that Vest
Percentage of Options that Vest
Less than 10% (minimum Target)
0%
10% to 15% (within target range)
Greater than 15%
(above maximum target)
50% - 100%
(on a straight-line basis)
100%
0%
0%
100%
LTIs
(Granted 28 October 2021)
Tranche 1 (50% of Options
– based on EPS CAGR)
Tranche 2 (50% of Options
– based on TSR CAGR)
CAGR over the three Financial
Years Ending 30 June 2024
Percentage of Options that Vest
Percentage of Options that Vest
Less than 10% (minimum Target)
0%
10% to 15% (within target range)
50% - 100%
(on a straight-line basis)
Greater than 15%
(above maximum target)
Greater than 20%
100%
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0%
0%
0%
100%
• For the purposes of the above performance hurdles, EPS means the Basic Earnings per Share calculated by
reference to the Company’s audited financial statements and excluding the impacts of AASB16.
• For the purposes of the above performance hurdles:
• for the options granted on 12 November 2020, TSR means Total Shareholder Return and will be measured using
the VVA 20-day Volume Weighted Average Market Price (VWAP) for the twenty (20) trading days commencing
from the announcement of results for the financial year ended 30 June 2020 (TSR measure start date) to the
same 20 trading period VWAP post the date of announcement of results for the year ended 30 June 2023 (TSR
measure end date);
• The performance hurdles will be tested only once the vesting condition has been met by the grantee senior
executive and following the Company’s audited accounts being finalised for each respective financial year end.
US E OF RE MU NERATI ON CO NS ULTANTS
Viva Leisure Limited’s Board engaged the services of
Crichton & Associates during the financial year ended 30
June 2022 to review and to provide recommendations
in respect of the amount and elements of executive
remuneration, including short-term and long-term
incentives.
Under the terms of the engagement, Crichton &
Associates provided remuneration recommendations as
defined in section 9B of the Corporations Act 2001 for
fees of $19,229 for these services for both the FY2021 and
FY2022 financial years.
Crichton & Associates confirmed that any
recommendations have been made free from undue
influence by members of the Group’s key management
personnel.
Crichton & Associates was engaged by, and reported
directly to, the Board of Directors. The agreement for
the provision of remuneration consulting services was
executed by the Chair of the Board of Directors on behalf
of the Board.
The report containing the remuneration recommendations
was provided by Crichton & Associates directly to the
Chair of the Board of Directors.
The Board is satisfied that the recommendations were
made free from undue influence from any members of the
key management personnel.
CO M PANY PE RFO RM ANC E
The tables below set out summary information about the consolidated entity’s earnings and movements in shareholder
wealth for the period from listing to 30 June 2022:
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O
R
T
A
U
D
I
T
E
D
Revenue
Net profit before tax
Net loss after tax
Share price at start of the year
Share price at end of the year
Interim dividend
Final dividend
Basic earnings pe share
Diluted earnings per share
30 June 2022
30 June 2021
30 June 2020
90,831,726
83,718,105
40,885,697
(17,140,726)
(8,793,735)
(9,343,618)
(12,141,191)
(6,384,898)
(6,246,345)
$1.64
$1.16
nil
nil
(13.8)
(13.1)
$2.62
$1.64
nil
nil
(8.2)
(7.9)
$0.88
$2.62
nil
nil
(10.9)
(10.4)
2 5
2 6
B. DE TAILS OF REMUNERATION
Details of the nature and amount of each element of the remuneration of each Key Management Personnel (KMP) of Viva
Leisure are shown in the table below:
Directors and
other Key
Management
Personnel
Short-term
Employee Benefits
Post-
employment
Benefits
Long-term Benefits
Share-
based
Payments
Performance
based on % of
Remuneration
Employee
Year
Cash
salary and
fees ($)
Incentives
($)
Super-
annuation
($)
Leave
($)
Termination
benefits ($)
Options
($)
Total
($)
2022 Short Term Incentive
As previously outlined during the FY2022 period the financial result of the group was significantly impacted by the
Covid-19 pandemic and the government imposed shut downs. As a result, the minimum financial threshold for the
FY2022 Short Term Incentive was not met. During the imposed shut down period the executive team led the Covid-19
response by driving multiple initiatives to mitigate the impact of the disruption on the business and to preserve cash and
reputation. Since the lifting of regulations, the Viva team has met all of the financial guidelines released to the market.
Financial Metric
Actual Results
Guidance
June revenue
2H FY22 revenue
June Margin
Half Margin
$10.3m
$57.0m
20.5%
16.3%
$10m+
$54m - $56m
20%+
15% - 17%
Executive Directors
Harry Konstantinou
2022
626,432
130,000
2 3 ,56 8
68,346
(Managing Director)
2021
425,000
Non-executive Directors
Bruce Glanville*
(Independent)
Rhys Holleran#
(Independent)
Louise Bolger^
(Independent)
Andrew Burns~
(Independent)
Mark McConnell&
2022
107,826
2021
86,794
2022
79,580
2021
51,962
2022
83,740
2021
-
2022
15,833
2021
2022
-
-
(Non-Independent)
2021
25,385
Susan Forrester
(Independent)@
2022
-
2021
37,500
Other Key Management Personnel
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
-
-
-
-
-
-
-
-
-
-
-
-
-
2 5,0 00
7,109
10,595
25,000
5,035
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Kym Gallagher
(Chief Financial
Officer)
Angelo Konstantinou
(Chief Technology
Officer)
Sean Hodges
(Chief Operating
Officer)
Total
Total
2022
356,432
47,500
23,568
8,511
2021
315,000
-
25,000
7,009
2022
2 4 0 , 4 3 2
33,000
22,881
10,110
2021
219,178
-
20,822
8,856
2022
240,432
56,118
22,881
7,929
2021
210,045
-
19,954
7,455
2022
1,750,707
266,618
108,528
94,895
2021
1,370,864
-
115,776
30,429
* Ceased 7 April 2022, remuneration shown is until date of cessation
# Appointed 30 September 2020
^ Appointed 5 July 2021
~ Appointed 20 April 2022
& Resigned 6 November 2020, remuneration shown is until the date of retirement
@ Resigned 31 December 2020, remuneration shown is until the date of retirement
% Calculated in accordance with AASB 2: Share Based Payments
2 7
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
129,563
977,909
65,870
522,980
26.5%
12.6%
In recognition of the initiatives taken during the Covid-19 shut down period and the achievement of the second half
guidance targets the board has used its discretion to award the executive team 50% of the available Short Term
Incentive. The cash settlement of the award will be paid in September 2022.
-
-
-
-
-
-
-
-
-
-
-
-
118,421
111,794
84,615
51,962
83,740
-
15,833
-
-
25,385
-
37,500
Nil
Nil
Nil
Nil
Nil
-
Nil
-
-
Nil
-
Nil
The relative proportions of remuneration that are linked to performance and those that are fixed for the financial year are
as follows:
Fixed remuneration
($)
At Risk Short-Term
Incentives (STI)
At risk options
Executive Directors
Harry Konstantinou
Other Key Management Personnel
Kym Gallagher
Angelo Konstantinou
Sean Hodges
650,000
Up to 40% of fixed
remuneration
Up to 60% of fixed
remuneration
380,000
264,000
264,000
Up to 25% of fixed
remuneration
Up to 30% of fixed
remuneration
Up to 25% of fixed
remuneration
Up to 30% of fixed
remuneration
Up to 25% of fixed
remuneration
Up to 30% of fixed
remuneration
R
E
M
U
N
E
R
A
T
I
O
N
R
E
P
O
R
T
A
U
D
I
T
E
D
Since the long-term incentives for the financial year are provided exclusively by way of options, the percentages disclosed
also reflect the value of remuneration consisting of options.
38,848
474,859
18.2%
The relative proportions of remuneration that are linked to performance and those that are fixed for subsequent financial
years are as follows:
19,907
366,916
27,280
333,703
14,052
262,908
16,302
343,662
6,733
244,187
211,994
2,432,742
106,562
1,623,632
5.4%
18.1%
5.3%
21.1%
2.8%
19.7%
6.6%
Executive Directors
Harry Konstantinou
Other Key Management Personnel
Kym Gallagher
Angelo Konstantinou
Sean Hodges
FY2022 changes to STIs and LTIs
Fixed remuneration
($)
At Risk Short-Term
Incentives (STI)
At Risk Long Term
Incentives (LTI)
700,000
Up to 40% of fixed
remuneration
Up to 60% of fixed
remuneration
410,000
285,000
320,000
Up to 25% of fixed
remuneration
Up to 30% of fixed
remuneration
Up to 25% of fixed
remuneration
Up to 30% of fixed
remuneration
Up to 25% of fixed
remuneration
Up to 30% of fixed
remuneration
Based on remuneration structure review conducted by the People and Culture Committee there is no change to
the underlying performance metrics for either the FY22 STI or LTI. The performance targets have been adjusted
by the Board to reflect the current market conditions and align incentives with shareholder interests.
2 8
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
C . SERVIC E AGREEMENTS
Remuneration and other terms of employment for the Executive Directors and other Key Management Personnel are
formalised in a Service Agreement. The major provisions of the agreements relating to remuneration for the financial year
are set out below:
Employee
Number
granted
Grant date
Value per
Option at
Grant Date
($)
Value of
Options at
Grant Date
($)
Number
Forfeited
Number
Exercised
Exercise
Proceeds
($)
Options
held at
Balance
Date
Vesting
and First
Exercise
Date
Last
Exercise
Date
Directors and other Key Management Personnel
Non-Executive Directors
Employee
Harry Konstantinou
Kym Gallagher
Angelo Konstantinou
Sean Hodges
Base Remuneration
($)
Term of Agreement
Notice Period
Bruce
Glanville#
Tranche 1
200,000
2-May-19
0.055
11,064
6 5 0 , 0 0 0
3 8 0 , 0 0 0
2 6 4 , 0 0 0
2 6 4 , 0 0 0
Ongoing
Ongoing
Ongoing
Ongoing
Six months
Three months
Three months
Three months
Other Key Management Personnel
Tranche 1
100,000
2-May-19
0.055
5,532
Kym
Gallagher
LTI
LTI
75,000
7-Jun-19
-
-
75,000
75,000
30-Oct-19
0.069
5,157
LTI
226,667
12-Nov-20
0.391
88,587
The major provisions of the agreements relating to remuneration for subsequent financial years are set out below:
Employee
Harry Konstantinou
Kym Gallagher
Angelo Konstantinou
Sean Hodges
Base Remuneration
($)
Term of Agreement
Notice Period
700,000
4 1 0 , 0 0 0
2 8 5 , 0 0 0
3 2 0,0 0 0
Ongoing
Ongoing
Ongoing
Ongoing
Six months
Three months
Three months
Three months
LTI
71,000
28-Oct-21
Tranche 1
100,000
2-May-19
50,000
7-Jun-19
0.580
0.055
-
41,180
5,532
-
50,000
Angelo
Konstantinou
LTI
LTI
Sean Hodges
LTI
LTI
LTI
50,000
30-Oct-19
0.069
3,438
LTI
160,000
12-Nov-20
0.391
62,532
49,000
28-Oct-21
0.580
28,420
76,667
12-Nov-20
0.391
3,438
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
200,000
7-Jun-19
2-May-23
100,000
7-Jun-19
2-May-23
-
75,000
31-Aug-22
31-Aug-24
226,667
16-Oct-23
16-Oct-25
71,000
16-Oct-24
16-Nov-24
100,000
7-Jun-19
2-May-23
-
50,000
31-Aug-22
31-Aug-24
160,000
16-Oct-23
16-Oct-25
49,000
16-Oct-24
16-Nov-24
76,667
16-Oct-23
16-Oct-25
49,000
28-Oct-21
0.580
28,420
49,000
16-Oct-24
16-Nov-24
D. SHARE- BASED REM UNERAT ION
#Ceased 7 April 2022, holding shown are as at the date of cessation
Total
4,615,334
295,000
4,320,334
All options refer to options over ordinary shares of the Company, which are exercisable on a one-for- one basis under the
terms of the agreements.
Options granted to the Executive Team are under the LTI Plan and under Tranche 1 and Tranche 2 Plans:
• LTI Plan Options: The vesting of those options and will be subject to the satisfaction of appropriate service-based
conditions and/or performance hurdles determined by the Board;
• Tranche 1 and Tranche 2 Plan Options: These options are currently vested.
Options granted under the LTI, Tranche 1 and Tranche 2 Plans carry no dividends or voting rights.
Details of options over ordinary shares in the Company that were granted as remuneration to each key management
personnel are set out in the table below. Non-Executive Directors are not entitled to participate in the LTI Plan.
Employee
Number
granted
Grant date
Value per
Option at
Grant Date
($)
Value of
Options at
Grant Date
($)
Number
Forfeited
Number
Exercised
Exercise
Proceeds
($)
Options
held at
Balance
Date
Vesting
and First
Exercise
Date
Last
Exercise
Date
Directors and other Key Management Personnel
Executive Directors
Tranche 1
1,000,000
2-May-19
Tranche 2
1,000,000
2-May-19
Harry
Konstantinou
LTI
LTI
170,000
7-Jun-19
170,000
30-Oct-19
0.069
11,689
LTI
750,000
12-Nov-20
0.391
293,119
0.055
0.072
-
55,320
72,232
-
170,000
1,000,000
7-Jun-19
2-May-23
1,000,000
7-Jun-19
2-May-23
-
-
-
-
-
-
-
-
-
-
-
E. S HARES HEL D BY D IR EC TOR S AND KE Y M ANAGEM EN T PE RSO NN EL
The number of ordinary shares in the Company during the 2022 reporting period held by each of the Group’s key
management personnel, including their related parties, is set out below
Directors and other Key
Management Personnel
Balance at
Start of Year
Granted as
Remuneration
Received on
Exercised
Options
Shares
Purchased
Shares
Sold
Held at the
End of the
Reporting
Period
Executive Directors
Harry Konstantinou
23,346,701
Non-Executive Directors
Rhys Holleran
Louise Bolger#
Andrew Burns&
30,000
-
46,876
Other Key Management Personnel
Kym Gallagher
140,000
Angelo Konstantinou
22,130,502
Sean Hodges
46,667
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
40,000
-
14,000
20,810
-
-
-
-
23,386,701
30,000
14,000
67,686
10,000
10,000
140,000
-
-
-
-
-
22,130,502
46,667
300,000
170,000
31-Aug-22
31-Aug-24
Retired Non-Executive Directors
750,000
16-Oct-23
16-Oct-25
Bruce Glanville*
300,000
LTI
243,000
28-Oct-21
0.580
140,940
243,000
16-Oct-24
16-Nov-24
*Ceased 7 April 2022, holdings shown are as at the date of cessation
#Appointed 5 July 2021
&Appointed 20 April 2022
2 9
At 30 June 2022 there were no loans outstanding to Directors or Key Management Personnel (2021: nil).
3 0
E
C
N
E
D
N
E
P
E
D
N
I
N
O
I
T
A
R
A
L
C
E
D
’
S
R
O
T
I
D
U
A
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
A
U
D
I
T
O
R
S
I
N
D
E
P
E
N
D
A
N
C
E
D
E
C
L
A
R
A
T
I
O
N
3 1
3 2
E
C
N
A
N
R
E
V
O
G
E
T
A
R
O
P
R
O
C
to achieving and
have adopted the fourth
edition of the Corporate
demonstrating the
Entities (the Group)
highest standards of
As such, Viva Leisure
Ltd and its Controlled
Governance Principles
corporate governance.
T The Board is committed
N
E
M
E
T
A
T
S
and Recommendations.
Governance Statement
ended 30 June 2022 is
The Group’s Corporate
for the financial year
relations website at
available on the investor
https://investors.vivaleisure.com.au
C
O
R
P
O
R
A
T
E
G
O
V
E
R
N
A
N
C
E
S
T
A
T
E
M
E
N
T
3 3
3 4
D
E
T
A
D
I
L
O
S
N
O
C
R
E
H
T
O
D
N
A
S
S
O
L
R
O
T
I
F
O
R
P
E
M
O
C
N
I
E
V
I
S
N
E
H
E
R
P
M
O
C
2
2
0
2
e
n
u
J
0
3
d
e
d
n
e
r
a
e
y
e
h
t
r
o
F
T
N
E
M
E
T
A
T
S
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
Revenue
Rental and outgoings expense
Employee benefits expense
Bank Charges
Advertising and marketing costs
Utilities and cleaning
Licences and subscriptions
Insurances
Repairs and maintenance
Professional fees
Depreciation and amortisation expense
Finance costs
Costs of capital raisings, acquisitions and contractual matters
Other expenses
Loss before income tax
Income tax benefit
Loss for the year
Total other comprehensive income for the year
Total comprehensive loss for the year
6
5
8
Note
2022
$
2021
$
4
90,831,726
83,718,105
(3,055,293)
(2,021,447)
20
(30,552,032)
(26,384,475)
(1,310,207)
(2,058,156)
(6,749,756)
(2,099,596)
(754,395)
(1,402,195)
(859,786)
(1,217,433)
(2,133,953)
(6,618,395)
(1,984,615)
(473,408)
(1,241,134)
(261,635)
(38,336,988)
(30,076,823)
(15,221,882)
(12,795,671)
(507,428)
(1,044,935)
(5,064,738)
(6,257,916)
(17,140,726)
(8,793,735)
4,999,535
2,408,837
(12,141,191)
(6,384,898)
-
-
(12,141,191)
(6,384,898)
This statement should be read in conjunction with the notes to the financial statements.
Earnings per share
24
Basic earnings per share:
Earnings from continuing operations
Diluted earnings per share:
Earnings from continuing operations
2022
Cents
(13.8)
(13.1)
2021
Cents
(8.2)
(7.9)
C
O
N
S
O
L
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
P
R
O
F
I
T
O
R
L
O
S
S
A
N
D
O
T
H
E
R
C
O
M
P
R
E
H
E
N
S
I
V
E
I
N
C
O
M
E
3 5
3 6
D
E
T
A
D
I
L
O
S
N
O
C
N
O
I
T
I
S
O
P
L
A
I
C
N
A
N
I
F
F
O
T
N
E
M
E
T
A
T
S
2
2
0
2
e
n
u
J
0
3
d
e
d
n
e
r
a
e
y
e
h
t
r
o
F
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Tax receivable
Inventories
Other assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Trade and other receivables
Property, plant, and equipment
Right of use assets
Intangible assets
Deferred tax assets
Other assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Trade and other payables
Borrowings
Lease liabilities
Contract liabilities
Current tax liabilities
Provisions
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Borrowings
Lease liabilities
Provisions
Deferred tax liabilities
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Retained earnings
TOTAL EQUITY
Note
2022
$
2021
$
9
10
16
11
12
10
14
19
15
16
12
17
13
19
18
16
21
13
19
21
16
10,069,569
828,624
1,153,991
809,462
1,460,502
14,322,148
17,290,971
2,719,211
-
899,521
991,848
21,901,551
158,001
52,009,555
130,424
51,707,684
224,358,419
204,883,653
66,201,293
77,669,403
1,425,841
47,915,884
69,896,036
1,700,848
421,822,512
376,234,529
436,144,660
398,136,080
7,007,703
4,435,032
29,107,442
2,628,546
-
2,982,583
46,161,306
15,695,868
215,390,301
7,634,055
65,453,213
304,173,437
350,334,743
85,809,917
6,383,048
2,080,500
22,873,600
4,437,889
1,560,361
1,875,182
39,210,580
7,927,000
197,287,676
6,794,176
60,564,445
272,573,297
311,783,877
86,352,203
116,677,780
(21,607,131)
(8,718,446)
22
23
128,064,691
(21,395,137)
(20,859,637)
85,809,917
86,352,203
C
O
N
S
O
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
O
F
F
I
N
A
N
C
I
A
L
P
O
S
I
T
I
O
N
3 7
3 8
This statement should be read in conjunction with the notes to the financial statements.
D
E
T
A
D
I
L
O
S
N
O
C
Y
T
I
U
Q
E
N
I
S
E
G
N
A
H
C
F
O
T
N
E
M
E
T
A
T
S
2
2
0
2
e
n
u
J
0
3
d
e
d
n
e
r
a
e
y
e
h
t
r
o
F
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
Share Capital
Reserves
Retained
Earnings
(Accumulated
losses)
Total Equity
$
$
$
$
Balance at 1 July 2020
87,375,694
(21,725,385)
(2,333,548)
63,316,761
Issue of shares, net of transaction costs and
tax
29,162,554
-
Exercise of share options
Share option premium reserve
139,532
-
Total transactions with owners
29,302,086
(5,532)
123,786
118,254
-
-
-
-
29,162,554
134,000
123,786
29,420,340
Loss for the year
Total comprehensive loss for the year
attributable to members of the entity
Total transactions with owners and other
transfers
-
-
(6,384,898)
(6,384,898)
-
(6,384,898)
(6,384,898)
29,302,086
118,254
(6,384,898)
23,035,442
Balance at 30 June 2020
116,677,780
(21,607,131)
(8,718,446)
86,352,203
Balance at 1 July 2021
116,677,780
(21,607,131)
(8,718,446)
86,352,203
Issue of shares, net of transaction costs and
tax
11,386,911
-
Exercise of share options
Share option premium reserve
Total transactions with owners
Loss for the year
Total comprehensive loss for the year
attributable to members of the entity
Total transactions with owners and other
transfers
-
-
-
-
11,386,911
-
211,994
11,598,905
(12,141,191)
(12,141,191)
-
11,386,911
211,994
211,994
-
-
11,386,911
211,994
(12,141,191)
(542,286)
-
(12,141,191)
(12,141,191)
Balance at 30 June 2022
128,064,691
(21,395,137)
(20,859,637)
85,809,917
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CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Payments to suppliers and employees
Interest received
Interest paid
Payments of income tax
Net cash provided by operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of intangibles
Payments for business combinations, net of cash acquired
Net cash (used in) investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Direct costs of issue of shares
Proceeds from borrowings
Repayment of borrowings
Reduction in equipment leases principal
Reduction in property leases principal
Net cash provided by financing activities
Net decrease in cash held
Cash at beginning of financial year
Note
2022
$
2021
$
6
25
14
15
29
22
22
19
19
100,204,471
95,961,521
(56,649,881)
(57,098,045)
8,747
72,568
(15,221,882)
(12,795,671)
(395,582)
(779,854)
27,945,873
25,360,519
(11,434,976)
(27,105,482)
82,196
(988,679)
598,208
(755,869)
(19,502,493)
(27,540,181)
(31,843,952)
(54,803,324)
11,714,929
30,139,532
(468,597)
(1,200,000)
12,912,000
3,112,500
(2,788,600)
(1,093,500)
(5,127,796)
(3,299,792)
(19,565,258)
(11,028,056)
(3,323,322)
16,630,684
(7,221,401)
(12,812,121)
17,290,971
30,103,095
C
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Cash at end of financial year
9
10,069,570
17,290,974
This statement should be read in conjunction with the notes to the financial statements.
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4 2
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› NOTE 1 – NATUR E OF OPERATIONS
The principal activities of the consolidated group
during the financial year were health club operations.
No significant change in the nature of these activities
occurred during the year.
› NOTE 2 – GENERAL INFORMATION AND
STATEMENT OF COMPLIANCE
The consolidated general purpose financial statements
of the Group have been prepared in accordance
with the requirements of the Corporations Act
2001, Australian Accounting Standards and other
authoritative pronouncements of the Australian
Accounting Standards Board (AASB). Compliance
with Australian Accounting Standards results in full
compliance with the International Financial Reporting
Standards (IFRS) as issued by the International
Accounting Standards Board (IASB). Viva Leisure
Limited is a for-profit entity and statements are
prepared on accruals basis under the historical cost
convention.
Viva Leisure Limited is the Group’s Ultimate Parent
Company. Viva Leisure Limited is a Public Company
incorporated and domiciled in Australia. The address of
its registered office and its principal place of business is
Unit 7, 141 Flemington Road, Mitchell, ACT, Australia.
The consolidated financial statements for the year
ended 30 June 2022 were approved and authorised for
issue by the Board of Directors on 17 August 2022.
› NOTE 3 – SUMMARY OF
ACCOUNTI NG POLI CIES
a. Overall Considerations
The consolidated financial statements have been
prepared using the significant accounting policies and
measurement bases summarised below.
b. COVID-19
Judgement has been exercised in considering the
impacts that the Coronavirus (COVID-19) pandemic
has had, or may have, on the group 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 group operates. During the first half of
the financial year, the Group had its clubs closed
across all states and the ACT at various times due
mandatory shutdowns imposed by the respective
State Governments and there remains uncertainty
with respect to future events or circumstances which
may continue to impact the financial results of the
consolidated entity.
acquiree’s financial statements prior to the acquisition.
Assets acquired and liabilities assumed are generally
measured at their acquisition date fair values.
The Directors monitor the Group’s liquidity and believe
that the strong balance sheet position, together
with the ability to raise funds if required, provide a
reasonable expectation that the Group will be able
to pay its debts as and when they become due and
payable. Accordingly, the Directors believe that the
preparation of the financial statements on a going
concern basis is still appropriate.
c. Basis of Consolidation
The Group financial statements consolidate those
of the Parent Company and all its subsidiaries as at
30 June 2022. The parent controls a subsidiary if it
is exposed, or has rights, to variable returns from its
involvement with the subsidiary and has the ability
to affect those returns through its power over the
subsidiary. All subsidiaries have a reporting date of 30
June. Refer to Note 30 for the list of subsidiaries.
All transactions and balances between Group
companies are eliminated on consolidation, including
unrealised gains and losses on transactions between
Group companies. Where unrealised losses on intra-
group asset sales are reversed on consolidation, the
underlying asset is also tested for impairment from a
group perspective. Amounts reported in the financial
statements of subsidiaries have been adjusted where
necessary to ensure consistency with the accounting
policies adopted by the Group.
Profit or loss and other comprehensive income of
subsidiaries acquired or disposed of during the year are
recognised from the effective date of acquisition, or up
to the effective date of disposal, as applicable.
d. Business Combinations
The Group applies the acquisition method in
accounting for business combinations. The
consideration transferred by the Group to obtain
control of a subsidiary is calculated as the sum of
the acquisition-date fair values of assets transferred,
liabilities incurred and the equity interests issued by
the Group, which includes the fair value of any asset
or liability arising from a contingent consideration
arrangement.
Acquisition costs are expensed as incurred.
The Group recognises identifiable assets acquired and
liabilities assumed in a business combination regardless
of whether they have been previously recognised in the
Goodwill is stated after separate recognition of
identifiable intangible assets. It is calculated as the
excess of the sum of: (a) fair value of consideration
transferred, (b) the recognised amount of any non-
controlling interest in the acquiree, and (c) acquisition
date fair value of any existing equity interest in the
acquiree, over the acquisition date fair values of
identifiable net assets. If the fair values of identifiable
net assets exceed the sum calculated above, the excess
amount (i.e. gain on a bargain purchase) is recognised
in profit or loss immediately. See note 15.
e. Fair Value of Assets and Liabilities
Where applicable, the Group measures some of its
assets and liabilities at fair value on either a recurring or
non-recurring basis, depending on the requirements of
the applicable Accounting Standard.
Fair value is the price the Group would receive to sell
an asset or would have to pay to transfer a liability
in an orderly (i.e. unforced) transaction between
independent, knowledgeable and willing market
participants at the measurement date.
As fair value is a market-based measure, the closest
equivalent observable market pricing information
is used to determine fair value. Adjustments to
market values may be made having regard to the
characteristics of the specific asset or liability. The fair
values of assets and liabilities that are not traded in
an active market are determined using one or more
valuation techniques. These valuation techniques
maximise, to the extent possible, the use of observable
market data.
To the extent possible, market information is extracted
from either the principal market for the asset or liability
(i.e. the market with the greatest volume and level of
activity for the asset or liability) or, in the absence of
such a market, the most advantageous market available
to the entity at the end of the reporting period (i.e. the
market that maximises the receipts from the sale of the
asset or minimises the payments made to transfer the
liability, after taking into account transaction costs and
transport costs).
For non-financial assets, the fair value measurement
also takes into account a market participant’s ability to
use the asset in its highest and best use or to sell it to
another market participant that would use the asset in
its highest and best use.
The fair value of liabilities and the entity’s own equity
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instruments (excluding those related to share-based
payment arrangements) may be valued, where there is no
observable market price in relation to the transfer of such
financial instruments, by reference to observable market
information where such instruments are held as assets.
Where this information is not available, other valuation
techniques are adopted and, where significant, are
detailed in the respective note to the financial statements.
f. Revenue
Health Club Operations
Revenue is derived mainly from the sale of health club
membership services to its customers.
To determine whether to recognise revenue, the Group
follows a 5-step process:
(i) Identifying the contract, or otherwise,
with a customer;
(ii) Identifying the performance obligations
(iii) Determining the transaction price
(iv) Allocating the transaction price to the
performance obligations
(v) Recognising revenue when/as performance
obligation(s) are satisfied
The health club membership services revenue stream
focuses on providing customers with access to the groups’
gym facilities. Revenue is recognised as the customers
are provided access to the gym. Under AASB 15: Revenue
from Contracts with Customers, this happens over time
as customers pay in advance of receipt of this service.
The consideration received in advance of providing these
services, which is generally two weeks in advance, is
recognised as a contract liability.
Therefore, revenue is recognised over time as the
customer consumes these services. The transaction price
is determined with reference to the contract price as
stated in the customer’s contract.
Franchise Operations
Following the acquisition of Australian Fitness
Management (Plus Fitness), the following additional
revenue recognition policies are now applicable for the
group.
The group enters into franchise licence agreements,
whereby franchisees pay an upfront five year licence
fee, and ongoing monthly franchise fees. The licence fee
consideration is received in advance of providing the
services attaching to the licence, which is generally over
a five year period, and is recognised as a contract liability.
The monthly franchise fees are recorded as revenue as
they are derived. The transaction price is determined with
reference to the contract price as stated in the franchise
agreement.
The group provides equipment to franchisees as part
of establishing the licence. The equipment is invoiced in
advance of the supply and is recognised as a contract
liability until the point in time the franchise commences
operation. On commencement of the franchises operation
the revenue is recognised. The transaction price is
determined by the amount invoiced to the franchise.
Interest revenue is recognised using the effective interest
method, which for floating rate financial assets is the rate
inherent in the instrument.
All revenue is stated net of the amount of goods and
services tax.
g. Borrowing costs
Borrowing costs directly attributable to the acquisition,
construction or production of a qualifying asset are
capitalised during the period of time that is necessary to
complete and prepare the asset for its intended use or
sale. Other borrowing costs are expensed in the period in
which they are incurred and reported in finance costs.
h. Goodwill
Goodwill represents the future economic benefits arising
from a business combination that are not individually
identified and separately recognised.
Goodwill is carried at cost less any accumulated
impairment losses. Goodwill is calculated as the excess of
the sum of:
(i) the consideration transferred at fair value;
(ii) any non-controlling interest (determined under
either the fair value or proportionate interest
method); and
(iii) the acquisition date fair value of any previously
held equity interest;
over the acquisition date fair value of any identifiable
assets acquired and liabilities assumed.
The acquisition date fair value of the consideration
transferred for a business combination plus the acquisition
date fair value of any previously held equity interest shall
form the cost of the investment in the separate financial
statements.
Goodwill on acquisition of subsidiaries is included in
intangible assets.
Goodwill is tested for impairment annually and is allocated
to the Group’s cash-generating units or groups of cash-
generating units, representing the lowest level at which
goodwill is monitored and not larger than an operating
segment. Gains and losses on the disposal of an entity
include the carrying amount of goodwill related to the
entity disposed of.
i. Other Intangible Assets
Intangible assets acquired as part of a business
combination, other than goodwill, are initially measured
at their fair value at the date of acquisition. Intangible
assets acquired separately are initially recognised at cost.
Intangible assets are subsequently measured at cost less
amortisation and any impairment. The gains or losses
recognised in the profit or loss arising from derecognition
of an intangible asset is measured as the difference
between net disposal proceeds and the carrying amount
of the intangible asset. The method and useful lives of
finite life intangibles are reviewed annually. Changes
in expected pattern of consumption or useful life are
accounted for prospectively by changing the
amortisation method or period.
Amortisation
The amortisable amount of all intangibles is amortised
on a straight-line basis over the asset’s useful life to the
consolidated group commencing from the time the asset
is held ready for use.
The amortisation rates used for each class of amortisable
assets are:
Class of Intangible
Trademarks
Capitalised Software
Digital Assets
j. Plant and Equipment
Amortisation
Rate per annum
5-10%
33%
10%
Each class of plant and equipment is carried at cost or fair
value less, where applicable, any accumulated depreciation
and impairment losses.
Plant and equipment are measured on the cost basis and
are therefore carried at cost less accumulated depreciation
and any accumulated impairment losses. In the event the
carrying amount of plant and equipment is greater than
the estimated recoverable amount, the carrying amount
is written down immediately to the estimated recoverable
amount and impairment losses are recognised either in
profit or loss. A formal assessment of recoverable amount
is made when impairment indicators are present (refer to
Note 4 k. for details of impairment).
The cost of fixed assets constructed within the
consolidated group includes the cost of materials, direct
labour, borrowing costs and an appropriate proportion of
fixed and variable overheads.
Subsequent costs are included in the asset’s carrying
amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits
associated with the item will flow to the consolidated
group and the cost of the item can be measured reliably.
All other repairs and maintenance are recognised as
expenses in profit or loss in the financial period in which
they are incurred.
Depreciation
The depreciable amount of all fixed assets including
buildings and capitalised lease assets, but excluding
freehold land, is depreciated on a straight-line basis
over the asset’s useful life to the consolidated group
commencing from the time the asset is held ready for
use. Leasehold improvements are depreciated over the
shorter of either the unexpired period of the lease or the
estimated useful lives of the improvements.
The depreciation rates used for each class of depreciable
assets are:
Class of Fixed Asset
Depreciation
Rate
Plant and equipment
Furniture and fittings
Motor Vehicles
Leased plant and equipment
Leasehold improvements
10-40%
10-20%
15-25%
5-20%
5-20%
The assets’ residual value and useful lives are reviewed,
and adjusted if appropriate, at the end of each reporting
period.
An asset’s carrying amount is written down immediately
to its recoverable amount if the asset’s carrying amount is
greater than its estimated recoverable amount.
Gains and losses on disposals are determined by
comparing proceeds with the carrying amount. These
gains or losses are recognised in profit or loss when the
item is derecognised.
k. Leases
The Group as a lessee
At inception of a contract, the Group assesses if the
contract contains or is a lease. If there is a lease present,
a right-of-use asset and a corresponding lease liability
are recognised by the Group where the Group is a lessee.
However, all contracts that are classified as short-term
leases (ie leases with a remaining term of 12 months or
less) and leases of low value assets are recognised as
operating expenses on a straight-line basis over the term
of the lease.
Initially the lease liability is measured at the present
value of the lease payments still to be paid at the
commencement date. The lease payments are discounted
at the interest rate implicit in the lease. If this rate cannot
be readily determined, the Group uses the incremental
borrowing rate.
Lease payments included in the measurement of the lease
liability are as follows:
• fixed lease payments less any lease incentives;
• variable lease payments that depend on an index or
rate, initially measured using the index or rate at the
commencement date;
• the amount expected to be payable by the lessee
under residual value guarantees;
• the exercise price of purchase options, if the lessee is
reasonably certain to exercise the options; and
• payments of penalties for terminating the lease, if
the lease term reflects the exercise of an option to
terminate the lease.
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The right-of-use assets comprise the initial measurement
of the corresponding lease liability, any lease payments
made at or before the commencement day and any initial
direct costs. The subsequent measurement of the right-
of-use assets is at cost less accumulated depreciation and
impairment losses.
Right-of-use assets are depreciated over the lease
term or useful life of the underlying asset, whichever is
the shortest.
Where a lease transfers ownership of the underlying asset
or the cost of the right-of-use asset reflects that the Group
anticipates exercising a purchase option, the specific asset
is depreciated over the useful life of the underlying asset.
Short-term leases
exist. An impairment charge is reversed if the cash-
generating unit’s recoverable amount exceeds its
carrying amount.
m. Financial Instruments
Recognition, initial measurement and derecognition
Financial assets and financial liabilities are recognised
when the Group becomes a party to the contractual
provisions of the financial instrument, and are measured
initially at fair value adjusted by transactions costs, except
for those carried at fair value through profit or loss,
which are measured initially at fair value. Subsequent
measurement of financial assets and financial liabilities are
described below.
The Group has elected not to recognise lease liabilities for
short-term leases that have a lease term of 12 months or
less. The Group recognises the lease payments associated
with these leases as an expense on a straight-line basis
over the lease term.
Financial assets are derecognised when the contractual
rights to the cash flows from the financial asset expire,
or when the financial asset and all substantial risks and
rewards are transferred. A financial liability is derecognised
when it is extinguished, discharged, cancelled or expires.
l. Impairment Testing of Goodwill, Other Intangible
Assets and Property, Plant and Equipment
Classification and
subsequent measurement
For impairment assessment purposes, assets are
grouped at the lowest levels for which there are largely
independent cash inflows (cash-generating units). As a
result, some assets are tested individually for impairment
and some are tested at cash-generating unit level.
Goodwill is allocated to those cash-generating units that
are expected to benefit from synergies of the related
business combination and represent the lowest level within
the Group at which management monitors goodwill.
Except for those trade receivables that do not contain a
significant financing component and are measured at the
transaction price in accordance with AASB 15, all financial
assets are initially measured at fair value adjusted for
transaction costs (where applicable)
For the purpose of subsequent measurement, financial
assets other than those designated and effective as
hedging instruments are classified into the following
categories upon initial recognition:
Cash-generating units to which goodwill has been
allocated (determined by the Group’s management as
equivalent to its operating segments) are tested for
impairment at least annually. All other individual assets or
cash-generating units are tested for impairment whenever
events or changes in circumstances indicate that the
carrying amount may not be recoverable.
An impairment loss is recognised for the amount by
which the asset or cash-generating unit’s carrying amount
exceeds its recoverable amount, which is the higher of fair
value less costs to sell and value-in- use. To determine the
value-in-use, management estimates expected future cash
flows from each cash- generating unit and determines
a suitable interest rate in order to calculate the present
value of those cash flows. The data used for impairment
testing procedures are directly linked to the Group’s latest
approved budget, adjusted as necessary to exclude the
effects of future reorganisations and asset enhancements.
Discount factors are determined individually for
each cash-generating unit and reflect management’s
assessment of respective risk profiles, such as market and
asset-specific risks factors.
Impairment losses for cash-generating units reduce
first the carrying amount of any goodwill allocated to
that cash-generating unit. Any remaining impairment
loss is charged pro rata to the other assets in the cash-
generating unit. With the exception of goodwill, all
assets are subsequently reassessed for indications that
an impairment loss previously recognised may no longer
• amortised cost
• fair value through profit or loss (FVPL)
• equity instruments at fair value through other
comprehensive income (FVOCI)
• debt instruments at fair value through other
comprehensive income (FVOCI)
Classifications are determined by both:
• The entities business model for managing
the financial asset
• The contractual cash flow characteristics of the
financial assets
All income and expenses relating to financial assets that
are recognised in profit or loss are presented within
finance costs, finance income or other financial items,
except for impairment of trade receivables, which is
presented within other expenses.
Subsequent measurement financial assets
Financial assets at amortised cost
Financial assets are measured at amortised cost if
the assets meet the following conditions (and are not
designated as FVPL):
• they are held within a business model whose
objective is to hold the financial assets and collect its
contractual cash flows
• the contractual terms of the financial assets give rise
to cash flows that are solely payments of principal and
interest on the principal amount outstanding
After initial recognition, these are measured at amortised
cost using the effective interest method. Discounting is
omitted where the effect of discounting is immaterial. The
Group’s cash and cash equivalents, trade and most other
receivables fall into this category of financial instruments.
Impairment of Financial assets
AASB 9’s impairment requirements use more forward
looking information to recognise expected credit losses
– the ‘expected credit losses (ECL) model’. Instruments
within the scope of the new requirements include
loans and other debt-type financial assets measured at
amortised cost and FVOCI, trade receivables, contract
assets recognised and measured under AASB 15 and loan
commitments and some financial guarantee contracts (for
the issuer) that are not measured at fair value through
profit or loss.
the ability of the borrower to fulfil its contractual cash
flow obligations.
A financial asset is not considered to carry low credit
risk merely due to existence of collateral, or because a
borrower has a risk of default lower than the risk inherent
in the financial assets, or lower than the credit risk of the
jurisdiction in which it operates.
Recognition of expected credit losses in
financial statements
At each reporting date, the Group assesses the credit
risk and recognises a loss allowance if appropriate. Any
movement in the loss allowance from prior year is treated
as an impairment gain or loss in the statement of profit or
loss and other comprehensive income.
The carrying amount of financial assets measured at
amortised cost includes the loss allowance relating to
that asset.
Classification and measurement of financial liabilities
The Group considers a broader range of information when
assessing credit risk and measuring expected credit losses,
including past events, current conditions, reasonable
and supportable forecasts that affect the expected
collectability of the future cash flows of the instrument.
As the accounting for financial liabilities remains largely
unchanged from AASB 139, the Group’s financial liabilities
were not impacted by the adoption of AASB 9. However,
for completeness, the accounting policy is disclosed
below.
In applying this forward-looking approach, a distinction is
made between:
The Group’s financial liabilities include borrowings, trade
and other payables.
• financial instruments that have not deteriorated
significantly in credit quality since initial recognition or
that have low credit risk (‘Stage 1’) and
• financial instruments that have deteriorated
Financial liabilities are initially measured at fair value, and,
where applicable, adjusted for transaction costs unless the
Group designated a financial liability at fair value through
profit or loss.
significantly in credit quality since initial recognition
and whose credit risk is not low (‘Stage 2’).
Subsequently, financial liabilities are measured at
amortised cost using the effective interest method.
‘Stage 3’ would cover financial assets that have objective
evidence of impairment at the reporting date.
‘12-month expected credit losses’ are recognised for the
first category while ‘lifetime expected credit losses’ are
recognised for the second category.
Measurement of the expected credit losses is determined
by a probability-weighted estimate of credit losses over
the expected life of the financial instrument.
Low credit risk operational simplification approach
If a financial asset is determined to have low credit risk
at the initial reporting date, the Group assumes that the
credit risk has not increased significantly since initial
recognition.
In order to make such a determination that the financial
asset has low credit risk, the Group applies its internal
credit risk ratings or other methodologies using a globally
comparable definition of low credit risk.
A financial asset is considered to have low credit risk if:
• there is a low risk of default by the borrower;
• the borrower has strong capacity to meet its
All interest-related charges and, if applicable, changes in
an instrument’s fair value that are reported in profit or loss
are included within finance costs or finance income.
n. Trade and other payables
Trade and other payables represent the liabilities for
goods and services received by the consolidated group
that remain unpaid at the end of the reporting period.
The balance is recognised as a current liability with the
amounts normally paid within 30 days of recognition of
the liability.
o. Inventories
Inventories are stated at the lower of cost and net
realisable value. Cost includes all expenses directly
attributable to the manufacturing process as well as
suitable portions of related production overheads,
based on normal operating capacity. Costs of ordinarily
interchangeable items are assigned using the first in, first
out cost formula. Net realisable value is the estimated
selling price in the ordinary course of business less any
applicable selling expenses.
contractual cash flow obligations in the near term;
p. Income taxes
• adverse changes in economic and business conditions
in the longer term may, but not necessarily will, reduce
Tax expense recognised in profit or loss comprises the
sum of deferred tax and current tax not recognised in
other comprehensive income or directly in equity.
N
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2
4 7
4 7
4 8
4 8
Current income tax assets and/or liabilities comprise those
obligations to, or claims from, the Australian Taxation
Office (ATO) and other fiscal authorities relating to the
current or prior reporting periods that are unpaid at the
reporting date. Current tax is payable on taxable profit,
which differs from profit or loss in the financial statements.
Calculation of current tax is based on tax rates and tax
laws that have been enacted or substantively enacted by
the end of the reporting period.
Deferred income taxes are calculated using the liability
method on temporary differences between the carrying
amounts of assets and liabilities and their tax bases.
However, deferred tax is not provided on the initial
recognition of goodwill or on the initial recognition of an
asset or liability unless the related transaction is a business
combination or affects tax or accounting profit. Deferred
tax on temporary differences associated with investments
in subsidiaries and joint ventures is not provided if reversal
of these temporary differences can be controlled by the
Group and it is probable that reversal will not occur in the
foreseeable future.
Deferred tax assets and liabilities are calculated, without
discounting, at tax rates that are expected to apply
to their respective period of realisation, provided the
expected rates are enacted or substantively enacted by
the end of the reporting period.
Deferred tax assets are recognised to the extent that it is
probable that they will be able to be utilised against future
taxable income, based on the Group’s forecast of future
operating results which is adjusted for significant non-
taxable income and expenses and specific limits to the use
of any unused tax loss or credit. Deferred tax liabilities are
always provided for in full.
Deferred tax assets and liabilities are offset only when
the Group has a right and intention to set off current tax
assets and liabilities from the same taxation authority.
Changes in deferred tax assets or liabilities are recognised
as a component of tax income or expense in profit or loss,
except where they relate to items that are recognised in
other comprehensive income (such as the revaluation
of land) or directly in equity, in which case the related
deferred tax is also recognised in other comprehensive
income or equity, respectively.
Viva Leisure Limited and its wholly-owned Australian
controlled entities have implemented the tax consolidation
legislation. As a consequence, these entities are taxed as
a single entity and the deferred tax assets and liabilities
of these entities are set off in the consolidated financial
statements.
q. Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits
held at call with banks, other short-term highly liquid
investments with original maturities of three months or
less, and bank overdrafts. Bank overdrafts are shown
within borrowings in current liabilities on the statement of
financial position.
r. Employee Benefits
Short-term employee benefits
Provision is made for the consolidated group’s obligation
for short-term employee benefits. Short-term employee
benefits are benefits (other than termination benefits)
that are expected to be settled wholly before 12 months
after the end of the annual reporting period in which the
employees render the related service, including wages and
salaries. Short-term employee benefits are measured at
the (undiscounted) amounts expected to be paid when
the obligation is settled.
The consolidated group’s obligations for short-term
employee benefits such as wages, salaries and sick leave
are recognised as part of provisions in the statement of
financial position.
Other long-term employee benefits
Provision is made for employees’ long service leave and
annual leave entitlements not expected to be settled
wholly within 12 months after the end of the annual
reporting period in which the employees render the
related service. Other long-term employee benefits are
measured at the present value of the expected future
payments to be made to employees. Expected future
payments incorporate anticipated future wage and salary
levels, durations of service and employee departures and
are discounted at rates determined by reference to market
yields at the end of the reporting period on government
bonds that have maturity dates that approximate the
terms of the obligations. Upon the remeasurement of
obligations for other long-term employee benefits, the net
change in the obligation is recognised in profit or loss as
part of employee benefits expense.
The consolidated group’s obligations for long-term
employee benefits are presented as non-current provisions
in its statement of financial position, except where the
consolidated group does not have an unconditional right
to defer settlement for at least 12 months after the end
of the reporting period, in which case the obligations are
presented as current provisions.
All employees of the consolidated group receive defined
contribution superannuation entitlements, for which
the consolidated group pays the fixed superannuation
guarantee contribution (currently 10.0% of the applicable
employee’s average ordinary salary) to the employee’s
superannuation fund of choice. All contributions in respect
of employees’ defined contribution entitlements are
recognised as an expense when they become payable.
The consolidated group’s obligation with respect to
employees’ defined contribution entitlements is limited to
its obligation for any unpaid superannuation guarantee
contributions at the end of the reporting period. All
obligations for unpaid superannuation guarantee
contributions are measured at the (undiscounted)
amounts expected to be paid when the obligation is
settled and are presented as current liabilities in the
consolidated group’s statement of financial position.
2
2
0
2
T
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A
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N
A
E
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A
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s. Share-based Employee Remuneration
The Group operates equity-settled share-based
remuneration plans for its employees (see note 20).
None of the Group’s plans feature any options for a
cash settlement.
All goods and services received in exchange for the grant
of any share-based payment are measured at their fair
values. Where employees are rewarded using share-based
payments, the fair values of employees’ services are
determined indirectly by reference to the fair value of the
equity instruments granted. This fair value is appraised
at the grant date and excludes the impact of non-market
vesting conditions (for example profitability and sales
growth targets and performance conditions).
All share-based remuneration is ultimately recognised as
an expense in profit or loss with a corresponding credit to
share option reserve. If vesting periods or other vesting
conditions apply, the expense is allocated over the vesting
period, based on the best available estimate of the number
of share options expected to vest.
Non-market vesting conditions are included in
assumptions about the number of options that are
expected to become exercisable. Estimates are
subsequently revised if there is any indication that the
number of share options expected to vest differs from
previous estimates. Any cumulative adjustment prior to
vesting is recognised in the current period. No adjustment
is made to any expense recognised in prior periods if share
options ultimately exercised are different to that estimated
on vesting.
Upon exercise of share options, the proceeds received
net of any directly attributable transaction costs are
allocated to share capital up to the nominal (or par)
value of the shares issued with any excess being
recorded as share premium.
economic benefits will result, and that outflow can be
reliably measured. Provisions are measured using the best
estimate of the amounts required to settle the obligation
at the end of the reporting period.
u. Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the
amount of GST, except where the amount of GST incurred
is not recoverable from the Australian Taxation Office
(ATO). In these circumstances the GST is recognised as
part of the cost of acquisition of the asset or as part of an
item of the expense.
Receivables and payables are stated inclusive of the
amount of GST receivable or payable. The net amount of
GST recoverable from, or payable to, the ATO is included
with other receivables or payables in the statement of
financial position.
Cash flows are presented on a gross basis. The GST
components of cash flows arising from investing or
financing activities, which are recoverable from or payable
to the ATO, are presented as operating cash flows included
in receipts from customers or payments to suppliers.
v. Comparative Figures
When required by Accounting Standards, comparative
figures have been adjusted to conform to changes
in presentation for the current financial year. The
comparatives reflect the consolidated group.
Where the consolidated group retrospectively applies
an accounting policy, makes a retrospective restatement
of items in the financial statements or reclassifies items
in its financial statements, a third statement of financial
position as at the beginning of the preceding period in
addition to the minimum comparative financial statements
is presented.
t. Provisions
w. Changes in Significant Accounting Policies
Provisions are recognised when the consolidated group
has a legal or constructive obligation, as a result of
past events, for which it is probable that an outflow of
There were no changes in significant accounting policies
during the year.
x. New and revised Australian Accounting Standards and Interpretations on issue but not yet effective
At the date of the financial statements, the Group has not applied the following new and revised Australian Accounting
Standards, Interpretations and amendments that have been issued but are not yet effective:
Standard/amendment
Effective for annual
reporting periods
beginning on or after
AASB 2020-1 Amendments to Australian Accounting Standards – Classification of
Liabilities as Current or Non-Current and AASB 2020-6 Amendments to Australian
Accounting Standards – Classification of Liabilities as Current or Non-current – Deferral
of Effective Date
AASB 2020-3 Amendments to Australian Accounting Standards – Annual Improvements
2018-2020 and Other Amendments
AASB 2021-2 Amendments to Australian Accounting Standards – Disclosure of
Accounting Policies and Definition of Accounting Estimates
1 January 2022
1 January 2022
1 January 2023
N
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2
2
4 9
4 9
5 0
5 0
y. Critical Accounting Estimates and Judgements
Inventories
Inventories
› NOT E 4 – R EVE NUE AND OT HER INCO M E
The directors evaluate estimates and judgements
incorporated into the financial statements based
on historical knowledge and best available current
information. Estimates assume a reasonable expectation
of future events and are based on current trends and
economic data, obtained both externally and within the
consolidated group.
Key estimates and uncertainty
Information about estimates and assumptions that
have the most significant effect on recognition and
measurement of assets, liabilities, income and expenses
is provided below. Actual results may be substantially
different.
Impairment
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.
Useful lives of depreciable assets
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.
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.
Business combinations
Business combinations
Management uses valuation techniques in determining
the fair values of the various elements of a business
combination. Particularly, the fair value of contingent
consideration is dependent on the outcome of many
variables that affect future profitability.
Revenue from contracts with customers
Income from franchise operations
Other sources of income
Total revenue and other income
The group operates in one segment, health club services.
a. Revenue from contracts with customers:
Lease term and option to extend under AASB16
Lease term and option to extend under AASB16
a. Income from franchise operations:
The lease term is defined as the non-cancellable period
of a lease together with periods covered by an option
to extend the lease if the lessee is reasonably certain
to exercise that option; and also periods covered by an
option to terminate the lease if the lessee is reasonably
certain not to exercise that option.
The decision on whether or not the options to extend are
reasonably going to be exercised is a key management
judgement that the entity will make. The Group determines
the likeliness to exercise on a lease-by-lease basis looking
at various factors such as which assets are strategic and
which are key to future strategy of the entity.
Timing of revenue recognition
Over time
At a point in time
Total revenue from contracts with customers
b. Other Revenue
Interest received
Rent received
Gain on disposal of property, plant and equipment
Total other revenue
› NOT E 5 – LOSS FO R T HE Y E AR
z. Reclassification of prior year presentation
Certain prior year amounts have been reclassified for consistency with the current year presentation.
These reclassifications had no effect on the reports results of operations.
The effect of reclassifications on the financial statement line items for the prior period is as follows:
2
2
0
2
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Note
2021
$
Increase /
(Decrease)
2021
(Restated)
$
Loss before income tax from continuing operations includes the following
specific expenses:
CURRENT ASSETS
Other assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Other assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
12
2,692,697
(1,700,849)
991,848
2,692,697
(1,700,849)
991,848
10
-
-
1,700,849
1,700,849
1,700,849
1,700,849
2,692,697
-
2,692,697
• Amounts expensed as part of business combinations and acquisition
505,074
4 5 5 ,1 1 1
opportunities
• Short term lease payments
• Amounts expensed as part of capital raises and debt restructure
• Costs relating to contractual matters with AFM Franchisees
1 2 1 , 1 8 1
125,000
92,746
219,027
206,795
383,029
› NOT E 6 – FI NANCE COSTS AND FI NANCE I NCO ME
Interest expense from borrowings at amortised cost:
External entities
Interest expenses for finance lease arrangements
Total interest expense
2022
$
2021
$
1,327,436
13,894,446
15,221,882
922,234
11,873,437
12,795,671
5 1
5 1
5 2
5 2
2022
$
84,132,492
6,630,146
2021
$
75,135,620
8,460,040
90,762,638
83,595,660
69,088
122,445
90,831,726
83,718,105
4a
4a
4b
84,132,492
6,630,146
75,135,619
8,460,041
90,762,638
83,595,660
87,798,838
2,963,800
78,951,201
4,644,459
90,762,638
83,595,660
8,747
60,341
-
69,088
72,568
39,442
10,435
122,445
2022
$
2021
$
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E
A
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D
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D
3
0
J
U
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E
2
0
2
2
› N OTE 7 – SEGMENT REPORTING
› NOT E 1 0 – T RAD E AND OT HER R E CE IVAB LE S
Management have determined that the Group operates in one business segment – health club operations; and one main
geographic segment. Refer to Note 4 for the revenue splits between the revenue with contracts from customers and
franchise operations.
› N OTE 8 – INCOME TAX EXPENSE
The major components of tax expense and the reconciliation of expected tax expense based on the effective tax rate of
Viva Leisure Limited at 30.0% (2021:30.0%) and the reported tax expense in profit or loss are as follows:
Profit / (loss) before tax
Domestic tax rate
Prima facie tax expense
Adjustment for non-deductible expenses:
Non-deductible expenses
Prior year’s over provision of tax
Income tax (benefit) / expense
Tax expense comprises
Current tax expense
Deferred tax expense
› N OTE 9 – CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Short-term bank deposits
Cash backed bank guarantees
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
2022
$
2021
$
(17,140,752)
(8,793,735)
30.0%
30.0%
(5,142,226)
(2,638,121)
80,405
62,286
66,313
162,971
(4,999,535)
(2,408,837)
(2,255,515)
1,573,022
(2,744,020)
(3,981,859)
(4,999,535)
(2,408,837)
2022
$
4,301,938
1,536,327
4,231,304
2021
$
3,261,521
9,678,852
4,350,598
10,069,569
17,290,971
The effective interest rate on short-term bank deposits was 1.00% (2021: 0.01%); these deposits are held at call.
Current
Trade receivables
Other receivables
Sub leases receivable
Total current trade and other receivables
Non-current
Sub leases receivable
Total non-current trade and other receivables
2022
$
2021
$
729,346
35,297
63,981
828,624
2,549,312
112,748
57,151
2,719,211
158,001
158,001
130,424
130,424
2022
Plus Fitness - franchise fees and territory
openings
Trade receivables
Other receivables and sub-leases receivable
Current
>30 days
past due
>60 days
past due
>90 days
past due
Total
$
$
$
$
$
98,415
24,970
6,648
151,111
281,144
182,959
99,278
17,368
-
12
-
247,863
448,202
-
99,278
380,652
42,338
6,660
398,974
828,624
The amount in current receivables for Australian Fitness Management – licence fees relates to franchise sites that are in
various stages of development. The fees become payable 14 days prior to the club opening.
The net carrying of trade receivables is considered a reasonable approximation of fair value.
› NOT E 1 1 – INVE NTO R IES
Current
At cost or lower of net realisable value
Finished goods
2022
$
2021
$
809,462
809,462
899,521
899,521
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E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
5 3
5 4
› N OTE 12 – OTHER ASSETS
Current
Prepayments
Non-Current
Cash bonds receivable
2022
$
2021
$
1,460,502
1,460,502
991,848
991,848
1,425,841
1,425,841
1,700,848
1,700,848
Bonds relate to amounts set aside against rental obligations to landlords where the Company is a lessee.
2
2
0
2
T
R
O
P
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A
U
N
N
A
E
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U
S
I
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A
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I
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› N OTE 13 - BORROWINGS
At amortised cost:
Bank loans
Current
Non-current
2022
$
2021
$
2022
$
2021
$
4,435,032
2,080,500
15,695,868
7,927,000
4,435,032
2,080,500
15,695,868
7,927,000
There are several asset specific security interests registered on the PPS Register against members of the Group listed at
Note 30.
In addition, the bank loans mature on 28 May 2025 and the facility agreement specifies the following security interests:
1.
First ranking General Security Interest from each Obligor comprising first ranking charge over all present and after
acquired property.
2. First ranking charge over any assets financed under the Equipment Finance Facility.
3. Account Set offs from Viva Leisure Property Pty Ltd over Deposits totalling $3,250,000 (relating to security for all
cash covered bank guarantees issued in the name of Viva Leisure Property Pty Ltd).
4. The interest rate payable on the drawn balance of the market rate loan is BBSY plus 4.30%, at 30 June 2022 this
amounted to 6.16%.
Finance lease liabilities are secured against the underlying leased equipment and are at an average interest rate of 5.4%
› NOT E 1 4 - PR OPE RT Y, PLANT AND E Q UI PME NT
Details of the Group’s property, plant and equipment and their carrying amounts are as follows:
Gross carrying amount
Balance at 1 July 2021
Additions
Acquisitions through business combinations
Disposals
Depreciation expense
Plant and
Equipment
Furniture
and
Fittings
Motor
Vehicles
Leasehold
Improvements
$
$
$
$
Total
$
14,931,462
1,052,726
286,074
35,437,422
51,707,684
1,611,739
301,333
50,165
9,471,739
11,434,976
1,699,967
(5,469,696)
-
-
-
(21,390)
-
-
1,699,967
(5,491,086)
(2,131,656)
(254,048)
(83,132)
(4,873,150)
(7,341,986)
Carrying amount at 30 June 2022
10,641,816
1,100,011
231,717
40,036,011
52,009,555
At cost
Accumulated depreciation
Written down value
17,765,791
2,616,755
616,347
50,368,014
71,366,907
(7,123,974)
(1,516,745)
(384,630)
(10,332,003)
(19,357,352)
10,641,817
1,100,010
231,717
40,036,011
52,009,555
Plant and
Equipment
Furniture
and
Fittings
Motor
Vehicles
Leasehold
Improvements
Total
$
$
$
$
$
Balance at 1 July 2020
Additions
5,894,068
1,016,891
9,351,082
358,689
Acquisitions through business combinations
1,942,276
-
319,197
146,771
-
21,416,577
28,646,733
17,248,940
27,105,482
-
(2,821)
1,942,276
(504,251)
Disposals
Depreciation expense
Carrying amount at 30 June 2021
At cost
Accumulated depreciation
Written down value
(465,901)
(15,503)
(20,026)
(1,790,063)
14,931,462
20,222,349
(5,290,887)
14,931,462
(307,351)
(159,868)
(3,225,274)
(5,482,556)
1,052,726
286,074
35,437,422
51,707,684
2,315,423
630,788
41,035,766
64,204,326
(1,262,697)
(344,714)
(5,598,344)
(12,496,642)
1,052,726 2 8 6 ,074
35,437,422
51,707,684
All depreciation charges are included within depreciation, amortisation and impairment of non-financial assets.
N
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F
O
R
T
H
E
Y
E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
5 5
5 5
5 6
5 6
› N OTE 15 – INTANGIBLES
Details of the Group’s intangibles and their carrying amounts are as follows:
Goodwill
Trademarks
Capitalised
Software
Digital
Assets
$
$
$
$
Total
$
15.1 Impairment Testing
For the purpose of annual impairment testing, the Group has one cash-generating unit which is expected to benefit from
the synergies of the business combinations in which the goodwill arises.
The following key assumptions were used in the value-in-use calculations:
Revenue Growth
Rate
Expense Growth
Rate
Discount Rate
Gross carrying amount
Balance at 1 July 2021
Additions
46,905,229
127,625
831,748
51,282
47,915,884
Health Clubs
4%
3%
6.25%
-
270
960,834
27,575
988,679
Acquisitions through business combination
17,906,507
-
-
-
17,906,507
Amortisation expense
-
(13,773)
(588,088)
(7,916)
(609,777)
Carrying amount at 30 June 2022
64,811,736
114,122
1,204,494
70,941
66,201,293
The recoverable amount above is determined based on value-in-use calculations. Value-in-use is calculated based on the
present value of cash flow projections over a five-year period plus a terminal value calculated using a terminal multiple
of 5x for health clubs and 8x for the Plus Fitness franchise business as determined by management. The present value of
the expected cash flows is determined by applying an estimated weighted average cost of capital (WACC) of 6.25%.
64,811,736
159,326
2,671,920
88,448
67,731,430
15.2 Growth Rates
At cost
Accumulated depreciation
Written down value
Gross carrying amount
Balance at 1 July 2020
Additions
-
(45,204)
(1,467,426)
(17,507)
(1,530,137)
64,811,736
114,122
1,204,494
70,941
66,201,293
Goodwill
Trademarks
Capitalised
Software
Digital
Assets
$
$
$
$
Total
$
19,744,625
126,585
604,033
54,472
20,529,715
-
14,323
738,775
2,771
755,869
Acquisitions through business combination
27,160,604
-
-
-
27,160,604
Amortisation expense
-
(13,283)
(511,060)
(5,961)
(530,304)
Carrying amount at 30 June 2021
46,905,229
127,625
831,748
51,282
47,915,884
At cost
Accumulated depreciation
Written down value
46,905,229
159,056
1,711,086
60,873
48,836,244
-
(31,431)
(879,338)
(9,591)
(920,360)
46,905,229
127,625
831,748
51,282
47,915,884
All amortisation is included in within depreciation and amortisation expense.
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
The growth rates reflect the estimated long-term average growth rates for mature health clubs.
15.3 Discount Rates
The discount rates reflect appropriate adjustments relating to market risk and any specific risk factors.
15.4 Cash Flow Assumptions
Management’s key assumptions include stable profit margins, based on past experience in this market. The Group’s
management believes that this is the best available input for forecasting this mature market. Cash flow projections reflect
stable profit margins achieved immediately before the budget period. No expected efficiency improvements have been
taken into account and prices and wages reflect publicly available forecasts of inflation for the industry.
Apart from the considerations described in determining the value-in-use of the cash-generating units above, and in Note
3 b. relating to the COVID-19 lockdowns, management is not currently aware of any other probable changes that would
necessitate changes in its key estimates.
N
O
T
E
S
T
O
T
H
E
C
O
N
S
O
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
S
F
O
R
T
H
E
Y
E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
5 7
5 7
5 8
5 8
› NOTE 16 – TAX
Non-Current Assets
Property, plant and equipment
Leased assets
Other intangible assets
Non-Current Liabilities
Provisions
Lease liabilities
Deferred legal costs
Current Liabilities
Provisions
Accruals
Lease liabilities
Equity
Costs of IPO allocated direct to equity
Represented by:
Deferred Tax Assets
Deferred Tax Liabilities
Non-Current Assets
Property, plant and equipment
Leased assets
Other intangible assets
Non-Current Liabilities
Provisions
Lease liabilities
Deferred legal costs
Current Liabilities
Provisions
Accruals
Lease liabilities
Contract liabilities
Equity
Costs of IPO allocated direct to equity
Represented by:
Deferred Tax Assets
Deferred Tax Liabilities
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
1 July
2021
$
Recognised
in Equity
Recognised in
Profit and Loss
30 June
2022
$
$
$
Tax Payable
CURRENT
2022
$
2021
$
Income tax (receivable)/payable
(1,153,991)
1,560,361
› NOT E 1 7 – T RAD E AND OT HER PAYAB LE S
Current
Trade payables
Sundry payables and accrued expenses
2022
$
2021
$
5,187,628
1,820,075
5,235,112
1,147,936
7,007,703
6,383,048
All amounts are short-term. The carrying values of trade and other payables are considered to be the fair value.
› NOT E 1 8 – CO NTR ACT L IAB IL IT I ES
Current
Amounts received in advance for sale of gym memberships
Amounts received in advance for franchise licence sales
Total contract liabilities
Refer to note 3 f. for the revenue recognition policy.
2022
$
2021
$
1,693,356
935,190
1,442,538
2,995,351
2,628,546
4,437,889
N
O
T
E
S
T
O
T
H
E
C
O
N
S
O
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
S
F
O
R
T
H
E
Y
E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
921,009
(61,465,096)
(69,785)
562,555
59,265,944
985,228
2,038,253
21,000
6,782,439
290,044
9,331,591
-
-
-
-
-
-
-
-
1,003,375
1,924,384
(5,842,429)
(67,307,525)
(287)
(70,072)
1,727,662
2,290,217
5,457,450
64,723,394
13,397
998,625
(1,143,478)
3,000
894,775
24,000
1,843,490
8,625,929
140,579
140,579
(318,160)
112,463
2,744,020
12,216,190
69,896,036
140,579
7,632,788
77,669,403
(60,564,445)
-
(4,888,768)
(65,453,213)
9,331,591
140,579
2,744,020
12,216,190
1 July
2020
Recognised
in Equity
Recognised in
Profit and Loss
30 June
2021
$
$
$
$
289,610
(53,064,533)
(9,228)
496,510
50,339,229
624,968
1,343,052
30,000
4,448,899
-
444,012
4,942,519
57,726,670
(52,784,151)
-
-
-
-
-
-
-
-
631,399
921,009
(8,400,563)
(61,465,096)
(60,557)
(69,785)
66,045
562,555
8,926,715
59,265,944
360,260
985,228
695,201
(9,000)
2,038,253
21,000
2,333,540
6,782,439
362,555
362,555
(516,523)
4,026,517
290,044
9,331,591
362,555
11,806,811
69,896,036
-
(7,780,294)
(60,564,445)
4,942,519
362,555
4,026,517
9,331,591
All deferred tax assets have been recognised in the statement of financial position.
5 9
5 9
6 0
6 0
› N OTE 19 – L EASES
2022
$
2021
$
2022
$
2021
$
(i) AASB 16 related amounts recognised in the balance sheet
Net carrying amount
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
RIGHT OF USE ASSETS
Leased buildings:
Opening balance
Additions to right-of-use assets
Depreciation expense
Net carrying amount
Leased equipment: *
Opening balance
Additions to right-of-use assets
Disposals of right-of-use assets
Depreciation expense
Net carrying amount
187,421,480
160,836,896
41,735,313
(27,086,271)
202,070,522
47,699,023
(21,114,439)
187,421,480
17,462,173
8,233,834
114,743
(3,522,853)
22,287,897
16,044,881
4,319,065
(93,956)
(2,807,817)
17,462,173
Total right-of-use assets
224,358,419
204,883,653
LEASE LIABILITIES
Leased buildings:
Opening balance
Additions to lease liabilities
Principal repayments
Net carrying amount
Leased equipment:
Opening balance
Additions to lease liabilities
Principal repayments
Net carrying amount
Total lease liabilities
Current liabilities
Non-current liabilities
204,620,113
40,467,271
168,106,082
47,579,096
(19,565,258)
(11,065,065)
225,522,126
204,620,113
15,541,163
8,562,249
(5,127,796)
18,975,616
14,521,011
4,319,944
(3,299,792)
15,541,163
244,497,743
220,161,276
29,107,442
215,390,301
22,873,600
197,287,676
244,497,743
220,161,276
(ii) AASB 16 related amounts recognised in the statement of profit or loss
Depreciation charge related to right-of-use assets (included in total
depreciation and amortisation expense)
30,385,224
24,033,264
Interest expense on lease liabilities (included in total finance costs)
13,894,446
11,873,437
(iii) Cash outflows relating to leases / rental payments
Property lease payments
Equipment lease payments
Total cash outflows for leases / rental payments
32,664,497
6,002,745
38,667,242
22,126,667
4,074,620
26,201,287
a. Options to Extend or Terminate
The options to extend or terminate are contained in several of the property leases of the Group. There were no
extension options for equipment leases. These clauses provide the Group opportunity to manage leases in order to
align with its strategies. All of the extension or termination options are only exercisable by the Group. The extension
options or termination options which management were reasonably certain to be exercised have been included in the
calculation of the lease liability.
› NOT E 20 – EMPLOY EE RE MU NE RAT IO N
20.1 Employee benefits - expense
Expenses recognised for employee benefits are analysed below:
Wages and salaries
Employee leave entitlements
Share based payments
Superannuation
Employee Benefits Expense
The Company received JobSaver payments of $766,360.
These payments have been recorded as other income for the year.
2022
$
2021
$
26,501,257
23,092,699
1,351,126
211,994
907,214
106,562
2,487,655
2,278,000
30,552,032
26,384,475
N
O
T
E
S
T
O
T
H
E
C
O
N
S
O
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
S
F
O
R
T
H
E
Y
E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
6 1
6 26 2
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
20.2 Share-Based Employee Remuneration
As at 30 June 2022, the Company maintained a Long-Term Incentive (LTI) share-based payment scheme for employee
remuneration, which will be settled in equity. In addition, the Company has issued Tranche 1 and Tranche 2 options.
Options granted to the Executive Team are under the LTI Plan and under Tranche 1 and Tranche 2 Plans:
• LTI Plan Options: The vesting of those options and will be subject to the satisfaction of appropriate service-based
conditions and/or performance hurdles determined by the Board;
• Tranche 1 and Tranche 2 Plan Options: These options are currently vested.
Options granted under the LTI, Tranche 1 and Tranche 2 Plans carry no dividends or voting rights.
Long Term Incentives (LTIs)
The table below describes the performance hurdles and vesting condition that in accordance with the Long Term
Incentive Plan in relation to the 1,920,334 options granted to senior executives:
Earnings per Share (EPS) Compound Annual Growth Rate (CAGR)
The percentage of options that vest for each % EPS and %TSR CAGR is illustrated in the following tables:
LTIs (Granted 30 October 2019)
EPS CAGR over the three Financial Years Ending 30 June 2022
Percentage of Options that Vest
Less than 15% (minimum Target)
0%
15% to 20% (within target range)
50% - 100%
(on a straight-line basis)
Greater than 20% (above maximum target)
100%
LTIs (Granted 12 November 2020)
Tranche 1 (50% of Options
– based on EPS CAGR)
Tranche 2 (50% of Options
– based on TSR CAGR)
CAGR over the three Financial Years
Ending 30 June 2023
Percentage of Options that Vest
Percentage of Options that Vest
Less than 10% (minimum Target)
0%
10% to 15% (within target range)
Greater than 15%
(above maximum target)
50% - 100%
(on a straight-line basis)
100%
0%
0%
100%
LTIs (Granted 28 October 2021)
Tranche 1 (50% of Options
– based on EPS CAGR)
Tranche 2 (50% of Options
– based on TSR CAGR)
CAGR over the three Financial Years
Ending 30 June 2024
Percentage of Options that Vest
Percentage of Options that Vest
Less than 10% (minimum Target)
0%
10% to 15% (within target range)
Greater than 15%
(above maximum target)
Greater than 20%
50% - 100%
(on a straight-line basis)
100%
-
0%
0%
0%
100%
• For the purposes of the above performance hurdles, EPS means the Basic Earnings per Share calculated by reference
to the Company’s audited financial statements.
• For the purposes of the above performance hurdles:
• for the options granted on 12 November 2020, TSR means Total Shareholder Return and will be measured using
the VVA 20-day Volume Weighted Average Market Price (VWAP) for the twenty (20) trading days commencing
from the announcement of results for the financial year ended 30 June 2020 (TSR measure start date) to the
same 20 trading period VWAP post the date of announcement of results for the year ended 30 June 2023 (TSR
measure end date);
• for the options granted on 28 October 2021, TSR means Total Shareholder Return and will be measured using the
VVA 15-day Volume Weighted Average Market Price (VWAP) for the fifteen (15) trading days commencing from
the announcement of results for the financial year ended 30 June 2021 (TSR measure start date) to the same 15
trading period VWAP post the date of announcement of results for the year ended 30 June 2024 (TSR measure
end date);
• The Basic EPS may be adjusted for items which the Board, in its discretion, considers should be excluded from the
EPS result (such as items of a one-off and non-recurring nature).
• The performance hurdles will be tested only once the vesting condition has been met by the grantee senior executive
and following the Company’s audited accounts being finalised for each respective financial year end.
All options refer to options over ordinary shares of the Company, which are exercisable on a one-for- one basis under the
terms of the agreements.
LTI
(Tranche 1)
LTI
(Tranche 2)
LTI
(Tranche 3)
No of
Options
No of
Options
No of
Options
Tranche
1
No of
Options
Tranche
2
No of
Options
Outstanding at 30 June 2021
295,000
1,213,334
-
1,400,000
1,000,000
Granted
-
-
Outstanding at 30 June 2022
295,000
1,213,334
412,000
412,000
-
-
1,400,000
1,000,000
Exercisable at 30 June 2022
-
-
-
1,400,000
1,000,000
The fair values of options granted were determined using the Black Scholes option pricing model. The following
principal assumptions were used in the valuation:
LTI
(Tranche 1)
LTI
(Tranche 2)
LTI
(Tranche 3)
Tranche
1
Tranche
2
Options
Options
Options
Options
Options
Grant date
30 October
2019
12 November
2020
28 October
2021
7 June 2019
7 June 2019
Vesting period ends
Share price at grant date ($)
Volatility
Option Life
Dividend yield
Risk free investment rate
Exercisable from
Exercisable to
Weighted average remaining
contractual life
Release of
FY2022 results
Release of
FY2023 results
Release of
FY2024 results
Vested
Vested
1.00
25%
2.75
25%
2.40
25%
1.00
25%
1.00
25%
5 years
5 years
5 years
4 years
4 years
0%
2%
0%
2%
0%
2%
0%
2%
82,979
1.34
0%
2%
72,232
1.43
7 June 2020
7 June 2020
2 May 2023
2 May 2023
Release of
FY2022
Results
31 August
2024
Release of
FY2023
Results
Release of
FY2024
Results
16 October
2025
16 November
2024
2.25 Years
3.30 Years
2.38 Years
0.94 Years
0.94 Years
Fair value at grant date
20,284
474,202
238,960
Exercise price at date of grant
Nil
3.34
Nil
The underlying expected volatility was determined by reference to historical data of comparable listed entities over a
period of time. No special features inherent to the options granted were incorporated into measurement of fair value.
In total, $211,994 (2021: $106,562) of employee remuneration expense (all of which related to equity-based payment
transactions) has been included in profit or loss and credited to share option reserve.
N
O
T
E
S
T
O
T
H
E
C
O
N
S
O
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
S
F
O
R
T
H
E
Y
E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
6 3
6 3
6 4
6 4
20.3 Employee benefits - liabilities
Current:
Employee leave entitlements
Non-Current:
Employee leave entitlements
2022
$
2021
$
2,982,583
1,875,182
277,809
830,640
Total employee obligations
3,260,392
2,705,822
› N OTE 2 1 – P ROVISIONS
Consolidated Group
Opening balance at 1 July 2021
Additional provisions
Amounts used
Balance at 30 June 2022
Current:
Employee benefits
Total current provisions
Non-Current:
Employee benefits
Property make good
Total non-current provisions
Total provisions
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
Employee
Benefits
Property Make
Good
$
$
Total
$
2,705,822
1,905,696
(1,351,126)
3,260,392
5,963,536
1,452,284
(59,574)
7,356,246
8,669,358
3,357,980
(1,410,700)
10,616,638
2022
$
2021
$
2,982,583
2,982,583
1,875,182
1,875,182
277,809
7,356,246
7,634,055
830,640
5,963,536
6,794,176
10,616,638
8,669,358
Provision for Property Make Good
A provision has been recognised for the costs to be incurred for the restoration of property leases for which the Group
is a lessee and where the obligation to make good is included as a condition of the lease. The provision is based on the
present value of estimated costs to restore the property at the end of each property lease term.
› NOT E 22 – EQ UI TY
22.1 Share Capital
The share capital of Viva Leisure consists only of fully paid ordinary shares. All shares are equally eligible to receive
dividends and the repayment of capital and represent one vote at the shareholders’ meeting of Viva Leisure.
2022
Shares
2021
Shares
2022
$
2021
$
Shares issued and fully paid:
Beginning of the year
81,956,221
71,511,393
116,677,780
87,375,694
Shares issued (less costs of offer)
7,558,019
10,344,828
11,386,911
29,162,554
Shares issued through exercise of options
-
100,000
-
139,532
Total contributed equity at 30 June
89,514,240
81,956,221
128,064,691
116,677,780
Capital Management
Capital Management
Management controls the capital of the Group in order to maintain a sustainable debt to equity ratio, generate long-term
shareholder value and ensure that the Group can fund its operations and continue as a going concern.
The Group’s debt and capital include ordinary share capital and financial liabilities, supported by financial assets.
The Group is not subject to any externally imposed capital requirements.
Management effectively manages the Group’s capital by assessing the Group’s financial risks and adjusting its capital
structure in response to changes in these risks and in the market. These responses include the management of debt
levels, distributions to shareholders and share issues.
There have been no changes in the strategy adopted by management to control the capital of the Group since the prior
year. This strategy is to ensure that the Group’s gearing ratio remains below 70%. The gearing ratios for the years ended
30 June 2022 and 30 June 2021 are as follows:
N
O
T
E
S
T
O
T
H
E
C
O
N
S
O
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
S
F
O
R
T
H
E
Y
E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
2022
$
2021
$
20,130,900
18,974,793
39,105,693
10,069,569
29,036,124
85,809,917
10,007,500
15,541,986
25,549,486
17,290,971
8,258,515
86,352,203
114,846,041
94,610,718
25.28%
8.7%
Provision for Employee Benefits
Provision for employee benefits represents amounts accrued for annual leave and long service leave. The current portion
for this provision includes the total amount accrued for annual leave entitlements and the amounts accrued for long
service leave entitlements that have vested due to employees having completed the required period of service. Based on
past experience, the Group does not expect the full amount of annual leave or long service leave balances classified as
current liabilities to be settled within the next 12 months. However, these amounts must be classified as current liabilities
since the Group does not have an unconditional right to defer the settlement of these amounts in the event employees
wish to use their leave entitlement.
The non-current portion for this provision includes amounts accrued for long service leave entitlements that have not yet
vested in relation to those employees who have not yet completed the required period of service.
In calculating the present value of future cash flows in respect of long service leave, the probability of long service leave
being taken is based on historical data. The measurement and recognition criteria relating to employee benefits have
been discussed in Note 3 (r).
Total borrowings - Market Rate loan
Total borrowings – equipment finance leases
Total borrowings
Less cash and cash equivalents
Net debt
Total equity
Total capital
Gearing ratio
6 5
6 5
6 6
6 6
› N OTE 2 3 – RESERVES
a. Common Control Reserve
A common control reserve was created when the Group restructure took place during the financial year ended 30 June
2019 as it was determined to occur under the control of the same shareholders. A business combination involving entities
or businesses under common control is a business combination in which all of the combining entities or businesses are
ultimately controlled by the same party or parties both before and after the business combination, and that the control is
not transitory.
Where an entity within the group acquires an entity under common control, the acquirer consolidates the carrying values
of the acquired entity’s assets and liabilities from the date of acquisition. The consolidated financial statements of the
group include the acquired entity’s income and expenses from the date of acquisition onwards. Any difference between
the fair value of the consideration paid/transferred by the acquirer and the net assets/ (liabilities) of the acquired entity
are taken to the common control reserve.
2022
$
2021
$
› NOT E 24 – E ARNI NGS PE R SH ARE AN D D IV ID E NDS
24.1 Earnings per Share
Both the basic and diluted earnings per share have been calculated using the profit attributable to shareholders of the
Parent Company as the numerator (i.e. no adjustments to profit were necessary in 2022 or 2021).
The reconciliation of the weighted average number of shares for the purposes of diluted earnings per share to the
weighted average number of ordinary shares used in the calculation of basic earnings per share is as follows:
Weighted average number of shares used in basic earnings per share
88,106,171
77,516,637
Shares deemed to be issued for no consideration in respect of options granted
4,248,731
3,804,466
Weighted average number of shares used in diluted earnings per share
92,354,902
81,321,103
2022
$
2021
$
Common Control Reserve
Beginning of the year
(21,900,880)
(21,900,880)
24.2 Dividends
Net movement in common control reserve
-
-
There were no dividends declared or paid during the year (2021: nil)
Total common control reserve at 30 June
(21,900,880)
(21,900,880)
24.3 Franking Credits
b. Share Options Reserve
The share option reserve records items recognised as expenses on valuation of employee share options.
Share Options Reserve
Beginning of the year
Exercise of options by key management personnel
Expensing of options to key management personnel
Payment for options by key management personnel
Total share options reserve at 30 June
2022
$
293,749
-
211,994
-
505,743
2021
$
175,495
(5,532)
106,562
17,224
293,749
The amount of franking credits available for subsequent reporting periods are:
Balance at the end of the reporting period
Franking credits that will arise from payment of (or receivable from) the amount of
provision for income tax (income tax receivable)
Total franking credits
2022
$
2021
$
5,021,279
2,825,510
(2,338,931)
1,560,361
2,682,348
4,385,871
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
N
O
T
E
S
T
O
T
H
E
C
O
N
S
O
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
S
F
O
R
T
H
E
Y
E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
6 7
6 86 8
› NOTE 25 – RECONCILIATION OF CASH FLOWS
› NOT E 27 – REL ATE D PAR T Y T R AN SACT I O NS
Cash flows from operating activities
Loss after income tax
Non-cash flows in loss
— depreciation and amortisation
— tax effect of expenses taken to equity
— share based payments
— other non-cash items
— (increase)/decrease in trade and term debtors
— (increase)/decrease in other assets
— (increase)/decrease in deferred tax
— increase/(decrease) in payables
— increase/(decrease) in current tax
— increase/(decrease) in other liabilities
— increase/(decrease) in provisions
Net cash from operating activities
› N OTE 2 6 - AUDITOR REMUN ERATION
Remuneration of the auditor for:
Audit and review of financial statements
Financial year ended 30 June
Half year ended 31 December
Other assurance engagements
Total audit services
Other non-audit services
Taxation and business services
Total non-audit services
Total auditor remuneration
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
2022
$
2021
$
(12,141,191)
(6,384,898)
38,336,988
30,076,823
140,579
211,994
26,942
362,554
118,254
-
(413,011)
1,251,544
1,155 ,8 63
(225,786)
(2,838,941)
(4,389,071)
624,655
(1,606,020)
(2,153,757)
557,269
901,634
948,157
6, 506,091
2,239,720
27,945,873
25,360,519
2022
$
2021
$
68,000
35,000
9,500
112,500
40,275
40,275
152,775
63,500
31,500
9,500
104,500
26,500
26,500
131,000
The Group’s related parties include key management of the Group which are considered to be any person(s) having
authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly,
including any director (whether executive or otherwise) of that entity.
27.1 Transactions with Directors and Key Management Personnel
Short-term Employee Benefits:
Wages and salaries (including bonuses and Annual Leave entitlements)
2,017,325
1,318,903
2022
$
2021
$
Superannuation
Long service leave
Share-based payments
Total remuneration
Short-term employee benefits
108,528
94,895
211,994
115,776
30,429
106,562
2,432,742
1,623,631
These amounts include fees and benefits paid to the non-executive Chair and non-executive directors as well as all salary,
paid leave benefits, fringe benefits and cash incentives awarded to KMP.
Post-employment benefits
These amounts are the superannuation contributions made during the year.
Other long-term benefits
These amounts represent long service leave benefits accruing during the year, long-term disability benefits and deferred
incentives payments.
Share-based payments
These amounts represent the expense related to the participation of certain KMP in equity-settled benefit schemes as
measured by the fair value of the options granted on grant date (see Note 20.2).
Further information in relation to KMP remuneration can be found in the directors’ report and at Note 20.
27.2 Related Party Properties
Total related party property transactions
2,396,913
3,014,870
2022
$
2021
$
Related parties continue to own several properties which are leased by the Group as described below. The Board
considers that each of these arrangements are on arm’s length terms, commercial terms and are subject to the usual risks
associated with other leases entered by the Company. The Board has obtained independent valuation advice to confirm
that the arrangements are arm’s length.
N
O
T
E
S
T
O
T
H
E
C
O
N
S
O
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
S
F
O
R
T
H
E
Y
E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
6 9
6 9
7 0
7 0
› N OTE 2 8 – CONTINGENT LIABILITIES
The company has no contingent assets or liabilities.
› NOTE 29 – B USINESS COMBINATIONS
During the period the Group acquired 25 clubs from various vendors in addition to Australian Fitness Management Pty
Limited, the master franchisor for the Plus Fitness network as outlined below:
Number of clubs
Acquisition
12
1
1
8
3
PLUS Sites
NSW
Victoria
Rebalance
MFC*
$
$
$
$
$
15
Total
$
Purchase consideration
Amount settled in cash, net of cash
acquired
Assets and liabilities acquired at
fair value
10,180,154
1,413,487
1,203,097
2,876,024
3,829,732
19,502,494
Property, plant and equipment
860,212
142,410
7 3 ,1 8 5
214,000
410,160
1,699,967
Other net identifiable assets /
(liabilities) acquired
(121,320)
(6,513)
(96,903)
(23,976)
144,732
(103,980)
Goodwill
9,441,262
1,277,590
1,226,815
2,686,000
3,274,840
17,906,507
10,180,154
1,413,487
1,203,097
2,876,024
3,829,732 19,502,494
Revenue and profit contribution from the date of acquisition until 30 June 2022
Revenue
2,552,966
656,348
804,013
901,675
1,358,503
6,273,505
Profit before depreciation,
amortisation, interest and tax
(but including property rental costs)
982,852
219,614
171,551
250,285
377,468
2,001,770
*MFC is the My Fitness Clubs group of clubs located in Qld
Acquisition-related costs amounting to $505,074 for all acquisitions have been recognised as an expense in the
consolidated statement of profit or loss and other comprehensive income.
The goodwill arising from these business combinations is not expected to be deductible for tax purposes.
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
7 1
7 1
› NOT E 3 0 – I NTE RESTS I N SU B SID I ARI ES
Name of Subsidiary
Principal Activity
Viva Leisure Operations Pty Limited
Health club operation
Viva Leisure People Pty Limited
Health club operation
Viva Leisure Property Pty Limited
Health club operation
Viva Leisure Memberships Pty Limited
Health club operation
Viva Pay Pty Limited
Direct Debit Service Provider
Chain Collective Group Pty Limited
Parent company for franchise operations
Rebalance Pilates & Yoga Group Pty Limited
Health club operation
Psycle Life Pty Limited
The Club Group Pty Limited
Dormant
Dormant
The Club Group (Greenway) Pty Limited
Dormant
Club MMM! Pty Limited
Dormant
HIIT Republic Australia Pty Limited
Health club operation
Plus Fitness Pty Limited
Master franchisor for Plus Fitness (Aust)
Viva Leisure (NZ) Limited
NZ Parent
Viva Leisure Operations (NZ) Limited
NZ operations
Plus Fitness (NZ) Limited
Master franchisor for Plus Fitness (NZ)
Plus Fitness International Pty Limited
Club Lime Pty Limited
Club Pink Pty Limited
Club Blue Pty Limited
Club Swim Pty Limited
Club Team Pty Limited
Dormant
Dormant
Dormant
Dormant
Dormant
Dormant
Proportion of
Ownership Interests
held by the Group
30 June
2022
30 June
2021
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
-
-
-
100%
100%
100%
100%
100%
100%
100%
100%
100%
-
100%
100%
100%
100%
100%
› NOT E 3 1 – CAPI TAL AND LEASI NG CO MM I T ME NTS
At 30 June 2022, Viva Leisure Limited has entered into a binding agreement for $0.85 million to purchase the following
health club:
• Plus Fitness – Hocking, WA
The acquisition was completed on 1 August 2022.
At 30 June 2021, Viva Leisure Limited entered into binding agreements totalling $2.85 million to purchase the following
health clubs:
• Plus Fitness - Mona Vale, NSW
• Plus Fitness – Beerwah, Qld
• One Health and Fitness - South Morang, Vic
These were all completed early in the financial year ended 30 June 2022.
N
O
T
E
S
T
O
T
H
E
C
O
N
S
O
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
S
F
O
R
T
H
E
Y
E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
Contractual Commitments
Within 1 Year
$
1 to 5 Years
$
After 5 Years
$
Total
$
30 June 2022
30 June 2021
850,000
2,850,000
-
-
-
-
-
-
7 2
7 2
› NOTE 32 – FINANCIAL INST RUMENT RISK
32.2 Credit Risk Analysis
The Group is exposed to various risks in relation to financial instruments. The main types of risks are market risk, credit
risk and liquidity risk.
The Group’s risk management is coordinated at its headquarters, in close cooperation with the Board, and focuses on
actively securing the Group’s short to medium-term cash flows by minimising the exposure to financial markets.
The Group does not actively engage in the trading of financial assets for speculative purposes, nor does it write options.
The most significant financial risks to which the Group is exposed are described below.
32.1 Market Risk Analysis
Credit risk is the risk that a counterparty fails to discharge an obligation to the Group. The Group is exposed to this risk
for various financial instruments, for example receivables to customers, placing deposits, investment in term deposits, etc.
Credit risk management
Credit risk management
The credit risk is managed on a group basis based on the Group’s credit risk management policies and procedures.
The credit risk in respect of cash balances held with banks and deposits with banks are managed via diversification of
bank deposits and are only with major reputable financial institutions.
The majority of the Group’s customer pay on an upfront basis by way of direct debit and as such, the Group does not
provide for bad debts as revenue is not recorded until received.
The Group is exposed to market risk through its use of financial instruments and specifically to interest rate risk, which
result from its operating and investing activities.
32.3 Liquidity Risk Analysis
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
30 June 2022
Financial assets
Financial liabilities
Total exposure
30 June 2021
Financial assets
Financial liabilities
Total exposure
Interest rate sensitivity
Interest rate sensitivity
Short term exposure
$
Long term exposure
$
1 2 , 5 1 6 , 7 1 0
-
(17,089,730)
(29,023,746)
(4,573,020)
(29,023,746)
20,010,182
(12,864,607)
-
(19,067,929)
7,145,575
(19,067,929)
The Group’s policy is to minimise interest rate cash flow risk exposures on long-term financing. Longer- term borrowings
such as equipment lease financed amounts are therefore usually at fixed rates. At 30 June 2022, the Group is exposed to
changes in market interest rates as its Bank Debt is at variable interest rates.
The following table illustrates the sensitivity of profit and equity to a reasonably possible change in interest rates of
+/- 2% (2021: +/- 1%). These changes are considered to be reasonably possible based on observation of current market
conditions. The calculations are based on a change in the average market interest rate for each period, and the financial
instruments held at each reporting date that are sensitive to changes in interest rates. All other variables are held
constant.
Profit for the Year
Equity
$
$
$
$
30 June 2022
30 June 2021
(102,395)
71,456
102, 395
(71,456)
(102,395)
71,456
1 0 2 , 3 9 5
(71,456)
Liquidity risk is the risk that the Group might be unable to meet its obligations. The Group manages its liquidity needs
by monitoring scheduled debt servicing payments for long-term financial liabilities as well as forecast cash inflows and
outflows due in day-to-day business. The data used for analysing these cash flows is consistent with that used in the
contractual maturity analysis below.
See Note 13 for details of borrowings during the financial periods under review.
32.4 Financial Risk Management
Within 1 Year
1 to 5 Years
Over 5 Years
Total
2022
$
2021
$
2022
$
2021
$
2022
$
2021
$
2022
$
2021
$
Consolidated Group
Financial liabilities due for payment
Trade and other
payables
Contract
liabilities
7,007,703
6,383,049
-
-
7,007,703
6,383,049
2,628,546
4,437,889
2,628,546
4,437,889
Bank loans
4,435,032
2,080,500
15,695,868
7,927,000
20,130,900
10,007,500
Finance lease
liabilities
Total expected
outflows
29,107,442
22,873,600
94,175,412
95,466,815
121,214,889
101,820,860
244,497,743
220,161,275
43,178,723
35,775,038
109,871,280
103,393,815
121,214,889
101,820,860
274,264,892
240,989,713
Financial assets – cash flows realisable
Cash and cash
equivalents
Trade
receivables
Total
10,069,569
17,290,971
828,625
2,719,211
anticipated
10,898,194
20,010,182
-
-
-
-
-
-
-
-
-
-
10,069,569
17,290,971
828,625
2,719,211
10,898,194
20,010,182
N
O
T
E
S
T
O
T
H
E
C
O
N
S
O
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
S
F
O
R
T
H
E
Y
E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
inflows
Net (outflow)/
inflow on
financial
instruments
(32,280,529)
(15,764,855)
(109,871,280)
(103,393,815)
(121,214,889)
(101,820,860)
(263,366,698)
(220,979,530)
7 3
7 3
7 4
7 4
› N OTE 33 – FAIR VALUE MEASUREMENT
Contractual commitments
Financial assets and financial liabilities measured at fair value in the statement of financial position are measured at
amortised cost.
At 30 June 2022, Viva Leisure Limited has entered into a binding agreement for $0.85 million to purchase the following
health club:
› N OTE 34 – PARENT ENTITY INFORMATION
Statement of Financial Position
Current Assets
Non-Current Assets
Total Assets
Current Liabilities
Total Liabilities
Net Assets
Issued Capital
Reserves
Retained Earnings
Total Equity
Statement of Profit and Loss and Other Comprehensive Income
Loss for the year
Other comprehensive income
Total Comprehensive Income
Guarantees and Security Interests
2022
$
2021
$
105,915,818
94,669,485
11,838
11,838
105,927,656
94,681,323
12,087
12,087
12,087
12,087
105,915,569
94,669,236
128,064,691
116,538,248
(21,395,137)
(21,467,599)
(753,986)
(401,413)
105,915,568
94,669,236
(352,573)
(486,340)
-
-
(352,573)
(486,340)
There are several asset specific security interests registered on the PPS Register against each of the members of the
Group listed at Note 31.
In addition, the bank loans mature on 28 May 2025 and the facility agreement specifies the following security interests:
1.
First ranking General Security Interest from each Obligor comprising first ranking charge over all present and after
acquired property.
2. First ranking charge over any assets financed under the Equipment Finance Facility.
3.
. Account Set offs from Viva Leisure Property Pty Ltd over Deposits totalling $3,250,000 (relating to security for
all cash covered bank guarantees issued in the name of Viva Leisure Property Pty Ltd)
4. The interest rate payable on the market rate loan is BBSY plus 4.31%
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
• Plus Fitness – Hocking, WA
The acquisition was completed on 1 August 2022.
At 30 June 2021, Viva Leisure Limited entered into binding agreements totalling $2.85 million to purchase the following
health clubs:
• Plus Fitness - Mona Vale, NSW
• Plus Fitness – Beerwah, Qld
• One Health and Fitness - South Morang, Vic
These were all completed early in the financial year ended 30 June 2022.
30 June 2022
30 June 2021
Contractual Commitments
Within 1 Year
1 to 5
Years
After 5 Years
Total
$
850,000
2,850,000
$
-
-
$
-
-
$
-
-
› NOT E 35 – EVENTS AFTE R T HE R EPO R TI NG PER IO D
The following events occurred after the reporting period:
Since the end of the financial year, Viva Leisure Limited has completed the acquisition of Plus Fitness, Hocking, WA
for $0.85 million.
No other matters or circumstances other than as referred to in this report, have arisen since the end of the financial year
which significantly affected or may significantly affect the operations of the consolidated group, the results of those
operations, or the state of affairs of the consolidated group in future financial years.
› NOT E 3 6 - CO MPANY I NFO R M AT IO N
Viva Leisure Limited is the Group’s Ultimate Parent Company. Viva Leisure Limited is a Public Company incorporated
and domiciled in Australia. The address of its registered office and its principal place of business is Unit 7, 141 Flemington
Road, Mitchell, ACT, Australia.
N
O
T
E
S
T
O
T
H
E
C
O
N
S
O
L
I
D
A
T
E
D
S
T
A
T
E
M
E
N
T
S
F
O
R
T
H
E
Y
E
A
R
E
N
D
E
D
3
0
J
U
N
E
2
0
2
2
7 57 5
7 6
N
O
I
T
A
R
A
L
C
E
D
’
S
R
O
T
C
E
R
I
D
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
P
U
O
R
G
E
R
U
S
I
E
L
A
V
V
I
VI VA L EI SUR E GRO UP DI RE CTO RS D EC LARATI O N
1)
In the opinion of the Directors of Viva Leisure Ltd:
a) a) The consolidated financial statements and notes of Viva Leisure Ltd are in accordance with
the Corporations Act 2001, including:
i) Giving a true and fair view of its financial position as at 30 June 2022 and of its
performance for the financial year ended on that date; and
ii) Complying with Australian Accounting Standards (including the Australian Accounting
Interpretations) and the Corporations Regulations 2001; and
b) There are reasonable grounds to believe that Viva Leisure Ltd will be able to pay its debts as and
when they become due and payable.;
2) The Directors have been given the declarations required by Section 295A of the Corporations Act 2001
from the Chief Executive Officer and Chief Financial Officer for the financial year ended 30 June 2022.
3) Note 2 confirms that the consolidated financial statements also comply with International Financial
Reporting Standards.
Signed in accordance with a resolution of the Directors.
Director
H A R R Y K O N S T A N T I N O U
Dated this
17 day of AUGUST 2022.
V
I
V
A
L
E
I
S
U
R
E
G
R
O
U
P
D
I
R
E
C
T
O
R
S
’
D
E
C
L
A
R
A
T
I
O
N
7 7
7 7
7 8
’
S
R
O
T
I
D
U
A
T
R
O
P
E
R
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
T
N
E
D
N
E
P
E
D
N
I
I
N
D
E
P
E
N
D
E
N
T
A
U
D
I
T
O
R
’
S
R
E
P
O
R
T
7 97 9
8 0
2
2
0
2
T
R
O
P
E
R
L
A
U
N
N
A
E
R
U
S
I
E
L
A
V
I
V
I
N
D
E
P
E
N
D
E
N
T
A
U
D
I
T
O
R
’
S
R
E
P
O
R
T
8 1
8 2
2
2
0
2
T
R
O
P
E
R
L
A
U
N
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The following information is current as at 15th September 2022
1 . DI ST RI B UT IO N OF SHAR EHO L DE R S
The Distribution of issued capital is as follows:
Holding
100,001 and over
10,001 – 100,000
5,001 – 10,000
1,001 – 5,000
1 – 1,000
2. D ISTR IB UT IO N OF O PTI O NS
Holding
100,001 and over
10,001 – 100,000
5,001 – 10,000
1,001 – 5,000
1 – 1,000
3 . 20 LAR GEST SHARE HOL D ER S
Shareholder
SHJA MANAGEMENT PTY LTD
NATIONAL NOMINEES LIMITED
CITICORP NOMINEES PTY LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
CAPITAL PROPERTY CORPORATION PTY LTD
HARRY KONSTANTINOU
BNP PARIBAS NOMS PTY LTD
MR JOHN KONSTANTINOU
CAPITAL PROPERTY CORPORATION PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
BROADGATE INVESTMENTS PTY LTD
SPIROS KONSTANTINOU
PORTMAN TRADING PTY LTD
PACIFIC L PTY LTD
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
MR JOHN KONSTANTINOU
EASTY HOLDINGS PTY LTD
MR ANGELO KONSTANTINOU
DIXSON TRUST PTY LIMITED
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Total No. of
Shares Held
No. of
Shareholders
80,081,857
6,373,351
1,334,351
1,395,264
329,417
89,514,240
35
238
178
565
735
1,751
Total No. of
Options Held
No. of
Shareholders
4,320,334
-
-
-
-
4,320,334
5
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Number Held
% of Issued
Shares
21,688,434
17,866,744
14,363,580
5,926,236
2,576,796
2,472,706
1,542,068
1,527,015
1,409,903
1,326,433
1,252,155
949,036
942,067
900,000
828,396
780,721
567,836
466,667
442,068
394,327
24.23%
19. 96%
16.05%
6.62%
2.88%
2.76%
1.72%
1.71%
1.58%
1.48%
1.40%
1.06%
1.05%
1.01%
0.93%
0.87%
0.63%
0.52%
0.49%
0.44%
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4. SU BSTA NTIAL SHAREHOLDERS
RE LAT ED PART Y L EAS E AG REE M ENTS
The names of the substantial shareholders listed in the holding company’s register as at 15 September 2022 are:
Shareholder
SHJA MANAGEMENT PTY LTD
NATIONAL NOMINEES LIMITED
CITICORP NOMINEES PTY LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
Number of
Shares
% of Issued
Shares
21,688,434
24.23%
17,866,744
14,363,580
5,926,236
19.96%
16.05%
6.62%
5. LESS THA N MARKETABLE PARCEL OF ORDINARY SHARES
There are 394 shareholders with unmarketable parcels totalling 94,963 shares.
6. UN QUOTED EQUITY SECURITIES
The company had the following unquoted securities on issue as at 15 September 2022:
Security
Unquoted Options
7. RE STRICTED SECURITIES
No. of Securities
4,320,334
The company had the following restricted securities on issue as at 15 September 2022:
8 . VOT ING RIGHTS
In accordance with the Constitution each member present at a meeting whether in person, or by proxy, or by power
of attorney, or in a duly authorised representative in the case of a corporate member, shall have one vote on a show of
hands, and one vote for each fully paid ordinary share, on a poll. Performance rights and Options have no voting rights.
9. ON - MA RKET BUY BACKS
There is no current on-market buy-back in relation to the Company’s securities
The Company received a waiver from Listing 10.1 at time of listing to the extent necessary to permit the Company not
to seek shareholder approval in relation to rental payments made during the remaining initial terms of certain lease
agreements as set out in the following table. A condition of the ASX waiver is for inclusion of a summary of the material
terms of these lease agreements in each annual report of the Company during the terms of the leases. The table below
sets out the material terms of these lease agreements.
Location
Lessor
Term and options
to renew
Current annual rent (plus GST) and future increases
Mitchell
Office space
Dimensional
Developments
Australia Pty Ltd
Club Lime
Mitchell
Dimensional
Developments
Australia Pty Ltd
Mitchell
Expanded
office space
Dimensional
Developments
Australia Pty Ltd
Club Lime
and Ladies
Only Gym
and Pool
CISAC
ClubMMM
at CISAC
Sports Centres
Australia Pty Ltd
Sports Centres
Australia Pty Ltd
Speedo shop
at CISAC
Sports Centres
Australia Pty Ltd
Club Lime
Curtin
Akon Holdings Pty
Ltd
Club Lime
Kambah
Jenke Investments
Pty Ltd
5 years commencing on
1 August 2018. 3 further
options to renew for 5
years each.
$115,392
Rent increases by 3% per annum in the initial term, after which the
base rent is set by market review on each exercise of the options
with further fixed annual increases of 3% per annum.
5 years commencing on
1 August 2018. 3 further
options to renew for 5
years each.
$180,300
Rent increases by 3% per annum in the initial term, after which the
base rent is set by market review on each exercise of the options
with further fixed annual increases of 3% per annum.
4 years commencing on 1
July 2019. 3 further options
to renew for 5 years each.
$115,392
Rent is fixed yearly (increasing incrementally year on year by 3%)
for the initial term of the lease, after which the base rent is set by
market review on each exercise of the options with further fixed
annual increases of 3% per annum.
10 years commencing 1
August 2018. 2 further
options to renew for 10
years each.
$2,058,951
Rent is fixed yearly (increasing incrementally year on year by 4%)
for the initial term of the lease, after which the base rent is set by
market review on each exercise of the options with further fixed
annual increases of 4% per annum.
5 years commencing 1
August 2018. 2 further
options to renew for 5
years each.
5 years commencing 1
August 2018. 2 further
options to renew for 5
years each.
5 years commencing 1
July 2018. 2 further options
to renew for 5 years each.
5 years commencing 1
August 2018. 2 further
options to renew for 5
years each.
$236,007
Rent is fixed yearly (increasing incrementally year on year by 4%)
for the initial term of the lease, after which the base rent is set by
market review on each exercise of the options with further fixed
annual increases of 4% per annum.
$45,039
Rent is fixed yearly (increasing incrementally year on year by 4%)
for the initial term of the lease, after which the base rent is set by
market review on each exercise of the options with further fixed
annual increases of 4% per annum.
$176,000
Rent is fixed yearly (increasing incrementally year on year by
$10,000) for the initial term of the lease, after which the base
rent is set by market review on each exercise of the options with
further fixed annual increases of 3.5% per annum.
N/A – property was sold on 21 December 2021
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OT HER KEY TE RM S
The Board considers that the leases are on arms’ length terms which reflect customary provisions commonly found in
commercial leases of a similar nature. Set out below are some key terms of these leases (other than those set out in
the other columns of this table). Rent is payable in advance by monthly instalments and the lessor may charge daily
interest on any late payment at 2% above the rate that would be charged by the lessor’s bank for unsecured overdrafts.
On termination of the lease, the lessee is responsible for make good of the premises. The lessee is responsible for
maintaining insurance to cover standard risks applicable to a lessee in the health club industry, public liability and for the
plate glass on the premises. The lessee releases the lessor from, and indemnifies the lessor against, claims for damages,
loss, injury or death.
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VIVA LEISURE ANNUAL REPORT 2022
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CE O :
Harry Konstantinou
CO M PANY S ECR ETARY:
Kym Gallagher
RE GISTE RED O FFI CE AND PRINCIPAL P LACE
O F B U SINE SS :
Unit 7, 141 Flemington Road, Mitchell ACT 2911
02 6163 8011
investor.relations@vivaleisure.com.au
www.vivaleisure.com.au
RE GISTE RS O F S ECU RI TIE S ARE HE LD AT
T HE FOL LOWI NG AD DR E SS :
Link Market Services
Level 12, 680 George Street, Sydney NSW 2000
1300 554 474
registrars@linkmarketservices.com.au
www.linkmarketservices.com.au
STO CK EXCHANGE LI ST ING
Quotation has been granted for all the ordinary shares
of the company on all Member Exchanges of the
Australian Securities Exchange Limited under the code
“VVA”.
AU DI TOR S
Hall Chadwick
Level 40, 2 Park St, Sydney NSW 2000
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