ANNUAL REPORT
31 December 2023
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Corporate directory
Current Directors
Mr Charles Chen
Mr Ivan Teo
Managing Director
Finance Director
Mr Blair Sergeant
Non-executive Director
Ms Shannon Coates
Non-executive Director
Mr Martin Zhou
Non-executive Director
Company Secretary
Ms Joan Dabon
Registered Office and Head Office
Share Registry
Street address:
Level 48, 152-158 St Georges Terrace
Computershare Investor Services Pty Ltd
Perth WA Australia 6000
Street address:
Level 17, 221 St Georges Terrace
Telephone:
+61 (0)8 6311 9160
Perth WA Australia 6000
info@vmoto.com
www.vmoto.com
Email:
Website:
Auditors
Hall Chadwick WA Audit Pty Ltd
Street address:
283 Rokeby Road
Subiaco WA Australia 6008
Postal address:
GPO Box D182
Telephone:
Facsimile:
Website:
Perth WA Australia 6840
1300 850 505
+61 (0)8 9323 2000 (International)
+61 (0)8 9323 2033
www.computershare.com/au
Telephone:
+61 (0)8 9426 0666
Securities Exchange
Banker
National Australia Bank
Australian Securities Exchange
Street address:
Level 40, Central Park
152-158 St Georges Terrace
Street address:
Level 14, 100 St Georges Terrace
Perth WA 6000
Perth WA Australia 6000
Telephone:
131 ASX (131 279) (within Australia)
Solicitors
Gilbert + Tobin
Street address:
Level 16, Brookfield Place Tower 2
123 St Georges Terrace
Perth WA Australia 6000
Telephone:
+61 (0)8 9413 8430
Telephone:
+61 (0)2 9338 0000
Facsimile:
Website:
ASX Code:
+61 (0)2 9227 0885
www.asx.com.au
ASX:VMT
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ANNUAL REPORT
31 December 2023
Contents
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Managing Director’s Letter ......................................................................................................................................... 1
Directors' report ......................................................................................................................................................... 2
Remuneration report ................................................................................................................................................ 17
Auditor's independence declaration ......................................................................................................................... 25
Consolidated statement of profit or loss and other comprehensive income .............................................................. 26
Consolidated statement of financial position ............................................................................................................ 27
Consolidated statement of changes in equity ........................................................................................................... 28
Consolidated statement of cash flows ....................................................................................................................... 29
Notes to the consolidated financial statements ........................................................................................................ 30
Directors' declaration ............................................................................................................................................... 71
Independent auditor's report ................................................................................................................................... 72
Corporate governance statement ............................................................................................................................. 77
Additional Information for Listed Public Companies ................................................................................................. 78
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VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Managing Director’s Letter
Dear Shareholders,
ANNUAL REPORT
31 December 2023
2023 was a year for Vmoto Limited (Company) with significant challenges owing to the increasingly volatile global
economic conditions. The high interest rates and even higher cost-of-living pressures have dampened consumer
spending; and the availability of funding within our industry. This, in turn, affected spending trends of our customers,
particularly in Europe. All these events have notable implications on our Company, customers and countries in which
we do business.
Despite these challenges, Vmoto has continued to achieve profitable results for FY2023:
Revenue of $69.2 million;
NPAT of $7.3 million and EBITDA of 7.7 million
Positive operating cash flow of $3.9 million; and
Closing cash position of $42.5 million.
Vmoto is a global fully integrated e-mobility solutions provider. Beyond designing, engineering, manufacturing and
distributing top tier e-motorcycles and e-scooters, Vmoto extends tailored e-mobility solutions to both individual
consumers and business clients across 73 countries in Europe, Asia Pacific, South America, North America, Middle
East, and Africa.
The Company aspires to accelerate the growth of the e-mobility industry by building an integrated ecosystem of
Vmoto’s range of e-mobility products, services, solutions and battery infrastructure, alongside fast charging
capabilities globally. Vmoto is strategically positioned with the widest global distribution network among two-wheel
e-mobility enterprises to achieve this vision.
Despite prevailing economic uncertainties, the Company remains steadfast in its commitment to capitalise on
opportunities by acquiring local distributors and operators, thereby establishing direct access to local markets. We
now have local teams and subsidiaries in key regions including the Netherlands, Italy, France, the United Kingdom,
and Thailand aimed at improving local sales and finance, better support and distribution, and after-sales services.
Furthermore, we are also actively expanding our sales efforts and cultivating new customer relationships in emerging
international markets across Asia, the Middle East, and South America.
Vmoto continues to face headwinds in both our B2C and B2B businesses but we remain resilient. Leveraging our
widest global distribution network within the two-wheel e-mobility industry and supported by robust financial
management practices and stringent cost control measures, we are able to effectively mitigate business risks. Vmoto
is dedicated to fostering sales growth by expanding our customer base and penetrating new markets, further
diversifying our revenue streams.
As we look forward to FY2024 and beyond, I am proud of our Company and the collective achievements of our global
workforce in Australia, Brazil, China, France, Italy, the Netherlands, Thailand, and the United Kingdom. Our
employees have demonstrated resilience and unwavering commitment as they work towards our shared aspirations
and goals.
Last but certainly not least, I extend my gratitude to our shareholders. Your support is instrumental as we continue
to build this remarkable business.
Yours faithfully,
CHARLES CHEN
Managing Director
Dated this 27th day of March 2024
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ANNUAL REPORT
31 December 2023
Directors' report
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Your directors present their report on the Group, consisting of Vmoto Limited (Vmoto or the Company) and its controlled entities
(collectively the Group), for the year ended 31 December 2023 (FY2023).
Vmoto is listed on the Australian Securities Exchange (ASX: VMT).
1. Directors
The names of Directors in office at any time during or since the end of the year are:
Mr Charles Chen
Managing Director
Appointed 5 January 2007
Mr Ivan Teo
Finance Director
Appointed 29 January 2013
Ms Shannon Coates Non-executive Director
Appointed 23 May 2014
Mr Blair Sergeant
Non-executive Director
Appointed 4 November 2020
Mr Martin Zhou
Non-executive Director
Appointed 15 September 2022
(collectively the Directors or the Board).
Directors have been in office since the start of the financial year to the date of this report unless otherwise stated. For additional
information of Directors including details of the qualifications of Directors, please refer to paragraph 6 of this Directors Report
2. Company secretary
The following person held the position of Company Secretary at the end of the financial year:
Joan Dabon
Qualifications and
Experience
Ms Dabon is a Chartered Secretary with Source Governance and has over seven years’ experience in
providing company secretarial and corporate advisory services to ASX and NSX listed companies across
a variety of sectors including mining, property development, logistics and distribution, manufacturing,
and agriculture. She has also acted as company secretary for public unlisted and proprietary
companies, monitoring and managing their corporate governance and compliance frameworks. Joan
has Juris Doctor degree and is an associate member of the Governance Institute of Australia.
3. Dividends paid or recommended
There were no dividends paid or recommended during the financial year ended 31 December 2023.
Significant Changes in the state of affairs
4.
There have been no significant changes in the state of affairs of the Group during the financial year ended 31 December 2023
other than disclosed elsewhere in this Annual Report.
5. Operating and financial review
5.1. Nature of Operations Principal Activities
The principal activity of the Group for the year was the development and manufacture, marketing, and distribution of
electric two-wheel vehicles (electric motorcycles and electric mopeds) (EV). There were no significant changes in the nature
of the Group’s principal activities during the year.
5.2. Operations Review
a. Financial Overview for FY2023
Financial results:
Total revenue of $69.2 million, down 40.6%% on FY2022;
Net profit after tax (NPAT) of $7.3 million, down 29.0% on FY2022; and
Earnings before interest, tax, depreciation and amortisation (EBITDA) of $7.7 million, down 37.5% on FY2022; and
Positive cash flows from operating activities of $3.9 million;
Strong cash position of $42.5 million as at 31 December 2023, up 51.7% from $28.0 million as at 31 December 2022;
Bank operating facility of $4.1 million as at 31 December 2023, fully repaid in January 2024;
Net tangible assets of $79.5 million at 31 December 2023, up 35.8% on 31 December 2022
Successfully completed an entitlement offer and placement of $15.8 million (before costs), which received strong
support from existing shareholders and new investors.
(refer section 5.3 Financial Review below for a detailed financial review)
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VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Directors' report
b. Operational Overview for FY2023
ANNUAL REPORT
31 December 2023
Total sales of 25,241 units of e-motorcycles and e-mopeds, delivered for FY2023, down 32% on FY2022 and down 19%
on FY2021;
Total international sales of 18,058 units, delivered for FY2023, down 46% on FY2022 and down 40% on FY2021;
Firm international orders of 2,401 units as at 31 December 2023, for delivery in the 1Q24;
In early FY2023, to mitigate business disruption from bankruptcy of customers/distributors in the Netherlands, the
United Kingdom and France, the Company reached agreement with the new acquirers of the Netherlands B2B
customer continue the business, and acquired the B2C business and assets in France and the United Kingdom, which
are now in full operation;
Vmoto's product, CPX Pro, sets the new Guinness World Record for the greatest distance covered in 24 hours with an
electric scooter;
Vmoto acquired industrial land in the Lishui Economic Development Zone in Nanjing, China and commenced the
construction of new 32,856m2 manufacturing facilities. Once completed, Vmoto’s manufacturing footprint will
increase to 62,977m2 and production capacity will increase from up to 150,000 units p.a. to a potential 300,000 units
p.a. (depending on models);
Vmoto acquired Soco Shanghai’s patents for models currently distributed by Vmoto, which significantly de-risks the
Company’s operations and international growth strategy; and
Exhibited and launched new products, APD e-motorcycle, CPX Explorer e-moped and battery swapping & charging
station at 2023 EICMA.
c. Sales and Financial Performance for FY2023
In FY2023, the Group sold a total of 25,241 units of e-motorcycles and e-mopeds, translating to total revenue of $69.5
million and NPAT of $7.3 million.
The Group’s sales performance has continued to be adversely impacted by current global economic conditions, which
has seen consumer spending reduce, particularly in Europe which is our largest market.
Although sales have been negatively impacted, the Group continued to achieve profitable results and the gross margin
of the Group improved from 27% in FY2022 to 29.4% in FY2023 due to growth in proportion of B2B sales and more
direct sales to dealers in France, Italy, and the United Kingdom (UK) through Vmoto's subsidiaries in those jurisdictions.
Vmoto is working on a number of initiatives to drive sales growth including:
providing support to distributors and dealers to develop more retail presence and increase brand exposure by way
of more signage and providing marketing materials at discounted prices;
actively pursuing sales outside of our established European markets and pursuing strategic acquisitions and
cooperation agreements in other regions. Vmoto is currently in discussions and working with a number of
distributors and partners to penetrate further into new market segments for Vmoto especially for Brazil, Indonesia,
Thailand and United Arab Emirates; and
actively promoting Vmoto's products through a number of marketing initiatives, including exhibitions, digital
channels and providing samples to potential distributors for testing.
With newly established subsidiaries in the UK and France, which are 100% owned by the Company, the operations in
the UK and France are gaining momentum in securing more sales and gaining market share, and the Company aims to
be the leading EV brand for these local markets.
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ANNUAL REPORT
31 December 2023
Directors' report
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Photo: New VMOTO dedicated store opened in Rome, Italy.
The chart below illustrates Vmoto’s historic international unit sales, by quarter, for the current and previous financial years:
d. International Markets
During FY2023, the Company signed and renewed distribution agreements with a number of international distributors
for the warehousing, distribution, and marketing of its Business-to-Consumer range of electric motorcycles/mopeds.
Vmoto now has a total of 67 international distributors distributing Vmoto products internationally across 73 countries.
In early FY2023, the Company encountered business disruptions due to the bankruptcy of customers/distributors in the
Netherlands, the United Kingdom, and France. The Company reached agreements with the new acquirers of the
Netherlands Business-to-Business customer to minimise loss and continue the Business-to-Business business in the
Netherlands, and acquired the Business-to-Consumer business and assets in France and the United Kingdom.
In July 2023, the Company signed a non-binding Memorandum of Understanding (MOU) with Ni Hsin EV Tech Sdn. Bhd.
(Ni Hsin EV), a wholly-owned subsidiary of Malaysia main market-listed Ni Hsin Group Berhad (Bursa: NIHSIN, 7215)
(Ni Hsin) in relation to the intention to form a strategic alliance to assemble, market and distribute Vmoto products
Citi, CPX Pro and TC Max electric motorcycle models in Malaysia.
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- 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000Q1Q2Q3Q4TotalInternational Sales Units202120222023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Directors' report
ANNUAL REPORT
31 December 2023
Under the MOU, Vmoto and Ni Hsin EV agreed to exercise their best efforts to form a strategic alliance, which will
include executing a distribution agreement and entering into a JV structure, subject to reaching certain sales
milestones, to assemble the VMT EV’s in Malaysia, and to market and distribute VMT EV’s through Business-to-
Consumer (B2C), Business-to-Business (B2B), and Business-to-Government (B2G) distribution channels in Malaysia.
Further in September 2023, Vmoto signed an exclusive assembly, marketing, and distribution agreement (EDA) with Ni
Hsin EV in relation to Vmoto products CPX-Pro and TC-Max electric motorcycle models in Malaysia.
Vmoto and Ni Hsin are currently working on homologation and compliance in Malaysia and Ni Hsin have been actively
providing samples to potential customers for evaluation and test riding.
Malaysia is the 12th largest ICE two-wheeler market in the world, having sold approximately 4 million units between
2014 and 20221, and two-wheeler EVs only account for 1.7% of the registered motorcycles in Malaysia, which
represents huge opportunity for the VMT EV’s.
Historical and Forecast Two-wheeler Sales in Malaysia between 2014 and 20271
1 Statista. (2022). Motorcycles - Malaysia. https://www.statista.com/outlook/mmo/motorcycles/malaysia
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ANNUAL REPORT
31 December 2023
Directors' report
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Photo: Vmoto France's new office, warehouse and after sales centre In Lyon, France.
Photo: Vmoto UK exhibited its wide range of electric motorcycle and moped products at Motorcycle Live 2023, the largest and most
prestigious motorcycle show in the United Kingdom (UK), held in Birmingham, United Kingdom on 18 November 2023.
e. Vmoto product sets new Guinness World Record
On the 2nd and 3rd of November 2023, one of Vmoto's products, the CPX Pro, set the new Guinness World Record for
the greatest distance achieved on an electric scooter in 24 hours.
Despite adverse weather conditions, the Vmoto technical team and skilled riders, coupled with the endurance and
performance of CPX Pro made it possible to break the previous record, with an impressive additional distance of 151
km, reaching 1,931 km in 24 hours of riding.
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VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Directors' report
ANNUAL REPORT
31 December 2023
Photo: Vmoto’s technical team celebrating after setting new Guinness World Record for the greatest distance achieved on an electric
scooter in 24 hours.
f. Expansion of manufacturing capacity with new facilities
In September 2023, the Company signed a construction agreement to build new 32,856m2 state-of-the-art
manufacturing facilities (Stage 2 Manufacturing Facilities) at the Company’s recently acquired industrial land in the
Lishui Economic Development Zone in Nanjing, China. The Company is pleased to confirm that the Company has
received the land title certificate and the construction of the new manufacturing facilities has commenced.
Once completed, Vmoto’s manufacturing footprint will more than double to 62,977m2, providing the Company with
increased production capacity, which in turn is expected to deliver economies of scale and increased manufacturing
margin.
Photo: Vmoto’s Managing Director, Mr Charles Chen and Chief Marketing Officer, Mr Graziano Milone, at the building site of Vmoto’s
Stage 2 Manufacturing Facilities.
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ANNUAL REPORT
31 December 2023
Directors' report
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Photo: Artist impression and conceptual renderings of the new manufacturing facilities
g. Acquisition of Soco Shanghai's patents
In September 2023, the Company successfully bid and acquired the patents for various models (TS, TC, CU, CUX, TC-MAX,
VS1, CPX, CU mini, TS Street Hunter and TC Wanderer) of Super Soco Intelligent Technology (Shanghai) Co, Ltd (Soco
Shanghai) for a total cash consideration of approximately RMB 13.5 million (A$2.9 million). The bid has been accepted
by the court that governed the collection of debts owed by Soco Shanghai, which Soco Shanghai has failed to repay. The
acquisition was funded from the Company’s existing cash reserves and owning these patents significantly de-risks the
Company’s operations and international growth strategy.
The operations of the jointly-owned Chinese registered manufacturing company, Nanjing Vmoto Soco Intelligent
Technology Co Ltd (Vmoto Soco), are unaffected and continue as normal as Vmoto Soco is independent from Soco
Shanghai and Vmoto, and has an independent management team.
Photo: Some of the e-motorcycle/e-moped models, of which the patents were acquired by Vmoto
h. EICMA 2023
During 7-12 November 2023, Vmoto exhibited and launched its new products at the Esposizione Internazionale Ciclo
Motociclo e Accessori 2023 (EICMA 2023) motorcycle expo held in Milan, Italy. Over 2,000 brands from around the world
promoted their brands to the 563,000+ attendees with Vmoto receiving significant interest in its latest designs.
EICMA 2023 was a great success for Vmoto and a significant number of attendees visited the Vmoto booth. Journalists,
customers, and the general public displayed significant interest in the Company’s designs and products. Vmoto also
obtained significant sales leads from EICMA 2023, which the sales team will actively pursue.
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VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Directors' report
ANNUAL REPORT
31 December 2023
The Company also used the opportunity to meet with its distributors to discuss 2024 business planning and sales strategies.
Photo: Vmoto booth exhibiting Vmoto and Vmoto Fleet products at EICMA 2023
i. Vmoto Launches New APD Electric Motorcycle
Vmoto unveiled its Vmoto APD electric motorcycle, developed in collaboration with Pininfarina, at EICMA 2023. In
designing and developing Vmoto’s APD electric motorcycle, Pininfarina used a wind tunnel for the first time on two-
wheel vehicle to maximise the performance of the electric motorcycle by minimising the effect of wind on the vehicle.
j. Vmoto Launches new CPX Explorer Electric Scooter
Vmoto also launched a new product, CPX Explorer, a stylistic evolution of one of Vmoto’s top selling products, CPX Pro.
This product was developed jointly with C-Creative, the design studio led by Adrian Morton, who has developed a
number of landmark products for MV Augusta.
k. Vmoto Launches Battery Swapping and Charging Station
Vmoto also launched and introduced its first battery swapping and charging station to provide a comprehensive and
integrated business solution for B2C and B2B customers. The battery swapping and charging station works perfectly with
Vmoto’s electric motorcycle and scooter, with the batteries of Vmoto’s electric motorcycle and scooter designed to be
swappable.
This is considered an important step in creating an ecology for Vmoto’s electric vehicle products. The ability to swap
batteries mid-journey will reduce travel time for Vmoto’s customers, for an efficient commuting experience.
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ANNUAL REPORT
31 December 2023
Directors' report
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Photo: Vmoto APD electric motorcycle launched and unveiled by Vmoto and Pininfarina in EICMA 2023.
Photo: Vmoto battery swapping and charging station to provide a comprehensive and integrated business solution for B2C and B2B
customers.
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VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
ANNUAL REPORT
31 December 2023
Directors' report
l. Outlook
The Group continues to identify opportunities and strategies to consolidate Vmoto’s strong market position and is well
positioned for growth through its portfolio of brands, products, and distribution network. Specifically, these
opportunities and strategies include:
Product portfolio – Vmoto plans to continue to expand its product portfolio to target different segment of e-
mobility markets in FY2024 and beyond;
Optimising key brands and unlocking VMOTO brand value – This strategy will be achieved by consolidating the
Company’s existing brands from VMOTO, SUPER SOCO and E-MAX brands to VMOTO and VMOTO FLEET and
unlocking the brand value of VMOTO to be more visible around the world.
Expand international footprint – The Company identified key export markets beyond Europe, and this provides
opportunity to de-risk its operations by diversification of export channels. These international footprints include
Southeast Asia, South America, Middle East, and North America markets.
New strategic cooperations with partners and customers - the Company also has been actively pursuing and
engaging with a number of potential new distributors, B2B customers, and partners for distribution and cooperation
opportunities to expand into new markets, which include Brazil, Thailand, and United Arab of Emirates.
Cost optimization and operations efficiency – the Company continues to work on cost reduction by reviewing and
optimizing its existing operations according to the needs of the current market and environment conditions and
identified opportunities to improve efficiency across the business.
Commit to Vmoto’s mission – the Company continues to commit to and realise its mission of creating a feeling of
excitement and joy for Vmoto zero emission e-motorcycle riders, to advance the electric motorcycle industry
globally through uncompromising quality and the highest level of customer service, to constantly innovate, and to
reduce greenhouse gas emissions to preserve the environment for future generations.
5.3. Financial Review
The financial statements have been prepared on a going concern basis, which contemplates the continuity of normal
business activity and the realisation of assets and the settlement of liabilities in the ordinary course of business.
For FY2023 the Group recorded earnings before interest, tax, depreciation and amortisation (EBITDA) of $7.69 million (FY2022:
$12.30 million). The Group generated a net profit after tax for the year of $7.26 million (FY2022: $10.22 million profit).
a. Reconciliation between the EBITDA and statutory net profit after tax for FY2023:
Earnings before interest, tax, depreciation and amortisation
Less: Depreciation and amortisation
Profit before interest and tax
Add: Interest income
Less: Interest expense
Less: Income tax expense
Net profit after tax 0 0
b. Key profit and loss measures:
Movement
(increase/
decrease)
Revenues from ordinary activities
Decreased
Profit from ordinary activities after tax Decreased
EBITDA
Decreased
Movement
$’000
47,425
2,960
4,612
2023
$’000
7,688
(865)
6,823
840
(175)
(230)
7,258
2023
$’000
69,248
7,258
7,688
2022
$’000
12,300
(1,310)
10,990
433
(23)
(1,182)
10,218
2022
$’000
116,673
10,218
12,300
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ANNUAL REPORT
31 December 2023
Directors' report
c. Key balance sheet measures
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Movement
increase/
(decrease)
Movement
$’000
In respect to Group assets
Cash and cash equivalents
Trade and other receivables
Inventories
Property, plant, and equipment
Investments in associates
Net assets
Working capital
In respect to Group liabilities and equity
Trade and other payables
Unearned revenue
Issued capital
Increased
Decreased
Increased
Increased
Decreased
Increased
Increased
Decreased
Decreased
Increased
14,498
8,250
2,637
2,858
292
20,961
10,397
10,181
3,457
17,933
2023
$’000
42,524
9,220
16,145
8,014
5,609
79,497
57,039
11,520
6,244
109,841
2022
$’000
28,026
17,470
13,508
5,156
5,901
58,536
46,642
21,701
9,701
91,908
5.4. Key Business Risks
The Group is subject to various risk factors. Some of these are specific to its business activities while others are of a more
general nature. Individually, or in combination, these risk factors may affect the future operating and financial performance
of the Group.
a. Intensifying competition in the electric two-wheel vehicles industry
Vmoto operates in the electric two-wheel vehicle industry and the Company expects additional competitors to enter this
market that may have greater financial, research and development, marketing, distribution, and other resources. We
believe that we can compete in this market due to our first mover advantage, having operated in the electric two-wheel
vehicle markets since 2009. Vmoto manufactures its products in China and has an established, comprehensive supply chain
for parts required to manufacture electric two-wheel vehicles and an established distribution network, currently
comprising 73 countries.
b. Technological obsolescence
Given the Company operates in an industry involving electric vehicle technology, any technological obsolescence could
have an impact on our financial results. We address this risk through continued investment in research and development,
patent appropriate and necessary research and development results, recruitment of competent technicians and constantly
monitoring the market. We see this risk as minimal as the Company is constantly developing new technology and functions
in its electric two-wheel vehicle products and has the protection of trademarks and patents.
c.
Increasing geopolitical risks in Europe due to the war between Russian and Ukraine
The escalating conflict between Russia and Ukraine poses a significant business risk to the Group, particularly in Europe,
due to increasing geopolitical instability. Furthermore, fluctuating currency exchange rates and trade restrictions may lead
to increased operational costs and hinder market expansion efforts. Additionally, consumer confidence might be affected,
resulting in decreased demand for discretionary goods like electric motorbikes, as individuals prioritise essential expenses
amidst geopolitical uncertainty. Thus, the Group faces challenges in navigating the complex geopolitical landscape of
Europe, which could potentially impede its growth and profitability in the region.
d. Adverse impact on demand due to global economic condition, including inflation, rising interest rates and higher
cost-of-living pressures
The adverse impact on demand stemming from global economic conditions, such as inflation, rising interest rates, and
higher cost-of-living pressures, poses a significant business risk to the Group. Inflationary pressures can lead to increased
production costs, squeezing profit margins and potentially necessitating price hikes that could deter price-sensitive
consumers. Moreover, rising interest rates may dampen consumer spending and investment appetite, affecting the
purchasing power of potential buyers for electric motorbikes. Additionally, higher cost-of-living pressures can divert
discretionary income away from luxury purchases like electric motorbikes, prompting consumers to prioritise essential
expenses. Consequently, the Group faces the challenge of navigating a challenging economic environment, which could
constrain demand and hinder revenue growth in key markets.
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VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Directors' report
5.5. Environmental Regulations
ANNUAL REPORT
31 December 2023
The Group’s operations are not subject to any significant environmental regulations. The Board believes that the Group has
adequate systems in place for the management of its environmental regulations and is not aware of any breach of those
environmental requirements as they apply to the Group.
a. Clean Energy Legislative Package
The Clean Energy Legislative Package, which included the Clean Energy Act 2011, was passed by the Australian Government
in November 2011. It sets out the way that the government will introduce a carbon price to reduce Australia’s carbon
pollution and move to a clean energy future.
The Group’s manufacturing activities are primarily carried out in China and the Directors believe that the Group will not be
significantly affected by this legislation. The Group has not incorporated the effect of any carbon price implementation in
its impairment testing at 31 December 2023.
The Directors’ view is that there were no changes in environmental or other legislative requirements during the year that
have significantly affected the results or operations of the Group.
5.6. Events Subsequent to Reporting Date
As detailed in note 16 Events subsequent to reporting date on page 60, the Group has the following subsequent events:
Acquisition of remaining 50% of Vmoto Soco Italy srl.
Incorporation of Thai subsidiary.
Lapse of rights.
Issue of shares to employees and consultants.
There are no other significant after balance date events that are not covered in this Directors' Report or within the financial
statements as disclosed in note 16.
5.7. Future Developments, Prospects, and Business Strategies
The Group’s future developments, prospects, and business strategies include:
a. Product portfolio:
Continue to expand its product portfolio to target different segment of e-mobility markets;
b. Optimising key brands and unlocking VMOTO brand value:
Consolidate the Company’s existing brands from VMOTO, SUPER SOCO and E-MAX brands to VMOTO and VMOTO FLEET
and unlocking the brand value of VMOTO to be more visible around the world;
c. Expand international footprint:
Expand export markets beyond Europe and this provides opportunity to de-risk its operations by diversification of
export channels. These international footprints include South East Asia, South America, Middle East, and North America
markets.
d. New strategic cooperations with partners and customers:
Actively pursuing and engaging with a number of potential new distributors, B2B customers and partners for distribution
and cooperation opportunities to expand into new markets, which includes Brazil, Thailand, and United Arab of
Emirates.
e. Cost optimization and operations efficiency:
Continue to work on cost reduction by reviewing and optimizing its existing operations according to the needs of the
current market and environment conditions and identify opportunities to improve efficiency across the business.
f. E-Mobility Solutions:
Develop battery charging and swapping station products to enhance revenue and establish the Company as an
integrated e-mobility solution provider.
P a g e | 13
ANNUAL REPORT
31 December 2023
Directors' report
6.
Information relating to the Directors
Mr Charles Chen
Managing Director
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Qualifications and experience
Mr Chen has been an Executive Director of the Company since 5 January 2007 and Managing
Director since 1 September 2011.
Mr Chen is an entrepreneur in the motorcycle industry and has previously founded
Freedomotor Corporation Limited in 2004, which was subsequently acquired by Vmoto through
a management buyout of key assets. Mr Chen holds a Bachelor of Automobile Engineering from
Wuhan University of Automobile Technology (China) and a postgraduate Diploma of Business
Administration from South Wales University (UK).
Mr Chen began his career with Hainan Sundiro Motorcycle Co, Ltd, the largest publicly listed
industrial company in Hainan Province, which was acquired by Honda Japan in 2001. Mr Chen
held senior executive roles with Hainan Sundiro from 1993 to 2002, and professionally trained
in broad aspect of the motorcycle manufacturing and distribution operations including
international sales and marketing, research and development, procurement, and production.
Mr Chen resides in China and oversees all the Company’s operations and activities.
Interest in Company equity
Direct
46,007,910 Ordinary shares
3,275,955
Performance rights
Directorships held in other
listed entities during the
prior three years
None
Mr Ivan Teo
Finance Director
Qualifications and experience
Mr Teo joined the Company as Chief Financial Officer on 17 June 2009 and has been Finance
Director of the Company since 29 January 2013. Mr Teo is an experienced finance executive
with significant experience in international business.
Mr Teo is a qualified Chartered Accountant and has over 18 years of finance and accounting
experience with private and public companies in a diverse range of industries including
automobile, manufacturing, mining, and retail.
Mr Teo graduated from the University of Adelaide, South Australia with a Bachelor of
Commerce and currently resides in China.
Interest in Company equity
Direct
4,075,000 Ordinary shares
1,622,275
Performance rights
Directorships held in other
listed entities during the
prior three years prior
None
Mr Blair Sergeant
Non-executive Director Independent
Qualifications and experience
Mr Sergeant is an experienced public company executive, having been an Executive Director
of Bowen Coking Coal Limited where he, alongside the Managing Director, was integral in the
Company’s transformation from explorer to producer. Mr Sergeant was also the former
Founding Managing Director of Lemur Resources Limited, as well as the former Finance
Director of Coal of Africa Limited, which grew from a sub-$2m market capitalisation to over
$1.5b at its peak. Mr Sergeant was instrumental in the acquisition of Vmoto in mid-2006 via
a reverse takeover of Optima Corporation Limited and the acquisition of Freedomotor Ltd by
Vmoto Limited in early 2007.
During his career, Mr Sergeant has held the position of Managing Director, Non- Executive
Director and/or Company Secretary for numerous listed entities across a broad spectrum of
industry. Mr Sergeant graduated from Curtin University, Western Australia with a Bachelor
of Business and subsequently, a Post Graduate Diploma in Corporate Administration. He is a
Chartered Secretary, member of the Governance Institute of Australia, member of the
Australian Institute of Company Directors and an Associate of the Australian Certified
Practising Accountants.
P a g e | 14
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Directors' report
ANNUAL REPORT
31 December 2023
Interest in Company equity
Indirect
300,000
Ordinary shares
Directorships held in other
listed entities during the
prior three years prior
Rincon Resources Ltd
Celsius Resources Ltd
Bowen Coking Coal Ltd
Ikwezi Mining Ltd
Non-executive Director
Former executive director
Former non-executive director
Former non-executive director
Shannon Coates
Non-executive Director
Independent
Qualifications and experience
Ms Coates has been a Non-Executive Director of the Company since 23 May 2014.
Ms Coates completed a Bachelor of Laws through Murdoch University and has since gained
over 25 years' in-house experience in corporate law and compliance for public companies.
She is a Chartered Secretary and an Associate Member of the Governance Institute of
Australia. She is also a graduate of the Australian Institute of Company Directors.
Ms Coates is the Managing Director of Source Governance, a professional services provider
specialising in company secretarial and governance services to both private and public ASX
listed companies.
Interest in Company equity
Indirect
622,411
Ordinary shares
Directorships held in other
listed entities during the
prior three years prior
Bellevue Gold Limited
ENRG Elements Ltd
(formerly Kopore Metals Limited)
Non-executive Director, Chair Nomination and Remuneration
Committee.
Former non-executive director (resigned 16 March 2020)
Martin Zhou
Non-executive Director
Independent
Experience
Mr Zhou has been a Non-Executive Director of the Company since 16 September 2022.
Mr Zhou's career spans over 36 years and includes national and international postings in the
motorcycle industry in China and Japan. Mr Zhou was instrumental in Honda Japan's strategic
acquisition and cooperation with Sundiro Group in China in year 2001 and directly
participated in the acquisition process including acquisition negotiations, staff restructuring
and technical advice on motorcycle models. Mr Zhou was also involved in the strategic
introduction of several motorcycle groups from Japan and China to Sundiro Group in China,
with the resulting cooperation arrangements including product development and technology
partnerships.
Mr Zhou graduated from Shandong University, China with a degree specialising in internal
combustion engines. Subsequently, Mr Zhou graduated from the School of Economics,
Yamaguchi University, Japan and received a Master of Business Administration.
Interest in Company equity
Direct
15,589,942 Ordinary shares
Directorships held in other
listed entities during the
prior three years prior
None
7. Meetings of Directors and committees
During the financial year, four meetings of Directors were held. Attendances by each Director during the year are stated in the
following table.
DIRECTORS'
MEETINGS
REMUNERATION AND
NOMINATION COMMITTEE
FINANCE AND OPERATIONS
COMMITTEE
AUDIT
COMMITTEE
Number
eligible to
attend
Number
Attended
Number
eligible to
attend
Number
Attended
Number
eligible to
attend
Number
Attended
Number
eligible to
attend
Number
Attended
Charles Chen
Ivan Teo
Blair Sergeant
Shannon Coates
Martin Zhou
4
4
4
4
4
4
4
3
4
3
At the date of this report, the Audit and Finance and Operations Committees comprise the full Board
of Directors. The Directors believe the Company is not currently of a size nor are its affairs of such
complexity as to warrant the establishment of these separate committees. Accordingly, all matters
capable of delegation to such committees are considered by the full Board of Directors.
P a g e | 15
ANNUAL REPORT
31 December 2023
Directors' report
8.
Indemnifying officers or auditor
8.1. Indemnification
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
The Company has paid premiums to insure each of the current and former Directors and officers against liabilities for costs
and expenses incurred by them in defending any legal proceedings arising out of their conduct while acting in the capacity
of Director or Officer of the Company, other than conduct involving a wilful breach of duty in relation to the Company. The
Company has not given any further indemnity or entered into any other agreements to indemnify or pay or agree to pay
insurance premiums.
No indemnities have been given or insurance premiums paid, during or since the end of the period, for any person who is
or has been an auditor of the Company
8.2. Insurance premiums
The contract of insurance prohibits disclosure of the nature of liability and the amount of the premium.
9. Options
9.1. Unissued shares under option
At the date of this report, the unissued ordinary shares of the Company under option (listed and unlisted) are as follows:
Grant Date
Date of Expiry
11.04.2022
11.04.2022
11.04.2022
11.04.2026
11.04.2027
11.04.2027
Exercise Price
$
Number under
Option
$0.45
$0.55
$0.65
6,600,000
7,700,000
8,800,000
Vested and
Exercisable
6,600,000
7,700,000
8,800,000
No person entitled to exercise the option has or has any right by virtue of the option to participate in any share issue of any
other body corporate.
23,100,000
23,100,000
9.2. Shares issued on exercise of options or vesting of rights
No shares have been issued by the Company during the financial year as a result of the exercise of options (2022: nil).
During the year the Company issued 4,037,117 shares on the vesting of performance rights (2022: 850,000).
10. Non-audit services
During the year, Hall Chadwick WA Audit Pty Ltd (Hall Chadwick), the Company’s and Group’s auditor did not provide non-audit
services (2022: nil), in addition to their statutory audits. Details of remuneration paid to the auditor can be found within the
financial statements at note 19 Auditor's Remuneration on page 61.
Where non-audit services are provided by Hall Chadwick, the Board has established certain procedures to ensure that the
provision of non-audit services are compatible with, and do not compromise, the auditor independence requirements of the
Corporations Act 2001 (Cth). These procedures include:
non-audit services will be subject to the corporate governance procedures adopted by the Company and will be reviewed by
the Board to ensure they do not impact the integrity and objectivity of the auditor; and
ensuring non-audit services do not involve reviewing or auditing the auditor's own work, acting in a management or decision-
making capacity for the Company, acting as an advocate for the Company or jointly sharing risks and rewards.
11. Proceedings on behalf of the Company
No person has applied to the Court under section 237 of the Corporations Act 2001 (Cth) for leave to bring proceedings on behalf
of the Company, or to intervene in any proceedings to which the Company is a party, for the purpose of taking responsibility on
behalf of the Company for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section 237 of the
Corporations Act 2001 (Cth).
12. Rounding of amounts
The amounts contained in this report have been rounded to the nearest thousand dollars under the option available to the
Company under Australian Securities and Investments Commission Corporations (Rounding in Financial/Directors’ Reports)
Instrument 2016/191 dated 24 March 2016.
P a g e | 16
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Directors' report
ANNUAL REPORT
31 December 2023
13. Corporate Governance
In recognising the need for the highest standards of corporate behaviour and accountability, the Directors of Vmoto support and
have substantially adhered to the best practice recommendations set by the ASX Corporate Governance Council. For a detailed
analysis of the Company’s Corporate Governance Policies, visit the corporate governance section of our website at
https://vmoto.com/investorcentre/.
14. Auditor's independence declaration
The lead auditor's independence declaration under section 307C of the Corporations Act 2001 (Cth) for the year ended
31 December 2023 has been received and can be found on page 25 of the interim financial report.
15. Remuneration report (audited)
This report outlines the remuneration arrangements in place for Directors and key management personnel of the Company for
the year ended 31 December 2023. The information in this remuneration report has been audited as required by section 308(3C)
of the Corporations Act 2001 (Cth).
15.1. Key management personnel (KMP)
This remuneration report details the remuneration arrangements for KMP who are defined as those persons having
authority and responsibility for planning, directing and controlling the major activities of the Company and the Group,
directly or indirectly, including any director (whether Executive or otherwise) of the parent company, and includes those
Executives in the Parent and the Group receiving the highest remuneration. KMP comprise the Directors of the Company
and key executive personnel:
Charles Chen
Ivan Teo
Blair Sergeant
Managing Director
Finance Director
Non-executive Director
Shannon Coates
Non-executive Director
Martin Zhou
Other KMP:
Adam Cui
Yaze Liu
Non-executive Director
Sales Manager
Research & Development Manager
Clive Mann
Country Manager UK
Graziano Milone
Chief Marketing Officer & President of Strategic Business Development
Gaetan Orselli
Country Manager France
Former KMP included in comparative information:
Kaijian Chen
Jeffrey Wu
Maik Spaan
Non-executive Director (Resigned 16 September 2022)
Sales Manager (Resigned 31 March 2022)
Not deemed KMP as at 1 January 2023
15.2. Principles used to determine the nature and amount of remuneration
a. Remuneration Policy
Broadly, remuneration levels for KMP of the Company and KMP of the Group are competitively set to attract and retain
appropriately qualified and experienced directors and executives and reward the achievement of strategic objectives.
The Board may seek independent advice on the appropriateness of remuneration packages of both the Company and
the Group given trends in comparative companies both locally and internationally, and the objectives of the Company’s
remuneration strategy.
Remuneration packages consist of fixed remuneration including base salary, employer contributions to superannuation
funds and non-cash benefits.
The Company has established a long-term incentive plan, which is known as the Vmoto Limited Employee Long Term
Incentive Plan (LTI Plan). This LTI Plan allows Directors to offer equity securities to attract, motivate and retain key
directors, employees and consultants and provide them with the opportunity to participate in the future growth of the
Company. Under the LTI Plan, the Board may offer to eligible persons the opportunity to subscribe for equity securities
in the Company as the Board may decide and, on the terms, set out in the rules of the LTI Plan.
P a g e | 17
ANNUAL REPORT
31 December 2023
Directors' report
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
15. Remuneration report (audited)
b. Performance Conditions Linked to Remuneration
The remuneration policy has been tailored to increase goal congruence between shareholders, Directors and executives.
Two methods have been applied to achieve this aim, the first being a performance-based rights subject to performance-
based vesting conditions, and the second being the issue of options or shares to KMP to encourage the alignment of
personal and shareholder interests
c. Remuneration structure
(1) Executive remuneration
The Company’s remuneration policy for executive directors and senior management is designed to promote superior
performance and long-term commitment to the Company. Executives receive a base remuneration which is market
related, as well as performance-based remuneration which is met out of a profit-sharing pool on a calendar year basis.
Overall remuneration policies are subject to the discretion of the Board and can be changed to reflect competitive
market and business conditions where it is in the interests of the Company and shareholders to do so.
Executive remuneration and other terms of employment are reviewed annually by the Remuneration Committee
having regard to performance, relevant comparative information and expert advice.
The Committee’s reward policy reflects its obligation to align executive’s remuneration with shareholders’ interests and
to retain appropriately qualified executive talent for the benefit of the Company. The main principles of the policy are:
reward reflects the competitive market in which the Company operates;
individual reward should be linked to performance criteria; and
executives should be rewarded for both financial and non-financial performance.
The total remuneration of executive directors and other senior managers consists of the following:
Salary
Bonus
Receive a fixed sum payable monthly in cash;
Eligible to participate in a profit participation plan if deemed appropriate long-term
incentives - executive directors may participate in share option schemes with the prior
approval of shareholders. Executives may also participate in employee share option
schemes, with any option issues generally being made in accordance with thresholds set in
plans approved by shareholders. The Board however, considers it appropriate to retain the
flexibility to issue options to executives outside of approved employee option plans in
exceptional circumstances;
Termination
Three months’ notice by the Company or the employee; and
Other benefits
Eligible to participate in superannuation schemes.
Remuneration of other executives consists of the following:
Salary
Bonus
Receive fixed sum payable monthly in cash;
Eligible to participate in a profit participation plan if deemed appropriate;
Long-term incentives Participate in share option schemes which have been approved by shareholders; and
Other benefits
Eligible to participate in superannuation schemes.
(2) Non-executive director remuneration
Total remuneration for all Non-Executive Directors, last voted upon by shareholders at the 2012 Annual General
Meeting, is not to exceed A$300,000 per annum and has been set at a level to enable the Company to attract and
retain suitably qualified Directors. The Company does not have any scheme relating to retirement benefits for Non-
Executive Directors.
(3) Fixed remuneration
Fixed remuneration consists of base remuneration (which is calculated on a total cost basis and includes any FBT charges
related to employee benefits including motor vehicle), as well as employer contributions to superannuation funds.
Remuneration levels are reviewed annually by the Board through a process that considers individual, segment and
overall performance of the Group. The Board has regard to remuneration levels external to the Group to ensure the
Directors’ and executives’ remuneration is competitive in the market place.
Executive Directors are employed full time and receive fixed remuneration in the form of salary and statutory
superannuation or consultancy fees, commensurate with their required level of services.
Non-Executive Directors receive a fixed monthly fee for their services. Where Non-Executive Directors provide services
materially outside their usual Board duties, they are remunerated on an agreed retainer or daily rate basis.
P a g e | 18
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Directors' report
15. Remuneration report (audited)
(4) Profit participation plan
ANNUAL REPORT
31 December 2023
Performance incentives may be offered to executive directors and senior management of the Company through the
operation of a profit participation plan. The amount available is based on profit performance above pre-determined
returns on shareholders’ funds.
This policy is reviewed annually.
(5) Service agreements
It is the Group’s policy that service agreements for KMP are unlimited in term but capable of termination on three
months’ notice and that the Group retains the right to terminate the service agreements immediately, by making
payment equal to three months’ pay in lieu of notice.
The service agreement outlines the components of compensation paid to KMP but does not prescribe how
remuneration levels are modified year to year. Remuneration levels are reviewed annually on a date as close as
possible to 31 December of each year to take into account KMP’s performance.
Certain KMP will be entitled to bonuses as the Board may decide in its absolute discretion from time to time.
d. Voting and comments made at the Company’s 2022 Annual General Meeting (AGM)
At the AGM held on 30 May 2023, on a poll the Company received 52,972,586 (86.50%) For votes and 8,266,042
(13.50%) Against votes and 1,813,901 abstentions2 on its remuneration report for the 2022 financial year. The Group
did not employ a remuneration consultant during the year.
15.3. Performance-based remuneration
a. The following table provides employment details of persons who were, during the financial year, members of KMP of
the Group. The table also illustrates the proportion of remuneration that was performance based and the proportion
of remuneration received in the form of options.
Group KMP
Position Held as at
31 December 2023 and any
change during the year
Contract
Commencement /
Termination Date
Proportions of Elements of
Remuneration Related to Performance
Non-salary
Cash-based
Incentives
%
Shares
%
Options /
Rights
%
Proportions of Elements of
Remuneration Not Related
to Performance
Fixed Salary/
Fees – cash
based
%
Fixed Salary/
Fees – share-
based
%
Executive Directors
Charles Chen
Managing Director
Ivan Teo
Finance Director
Non-executive directors
Blair Sergeant
Non-executive Director
Shannon Coates
Non-executive Director
Martin Zhou
Other KMP
Adam Cui
Yaze Liu
Clive Mann
Graziano Milone
Non-executive Director
Sales Manager
Research & Development
Manager
Country Manager UK
Chief Marketing Officer and
President of Strategic Business
Development
5.01.2007 Executive Dir.
1.09.2011 MD
29.01.2013
04.11.2020
23.05.2014
16.09.2022
17.02.2020
1.07.2022
15.07.2022
1.03.2022
Gaetan Orselli
Country Manager France
1.07.2020
-
-
-
-
-
32
-
-
-
-
-
-
-
-
-
-
-
-
-
-
34
29
-
-
-
-
-
-
-
-
54
50
100
100
-
47
100
89
56
86
12
21
-
-
100
21
-
11
44
14
Total
%
100
100
100
100
100
100
100
100
100
100
2 Votes cast by a person who abstains on an item are not counted in calculating the required majority on a poll
P a g e | 19
ANNUAL REPORT
31 December 2023
Directors' report
15. Remuneration report (audited)
b. Statutory performance indicators
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
The Group aims to align our executive remuneration to our strategic and business objectives and the creation of
shareholder wealth. Reported below are measures of the Group’s financial performance over the last five years as
required by the Corporations Act 2001 (Cth). However, these are not necessarily consistent with the measures used in
determining the variable amounts of remuneration to be awarded to KMPs. As a consequence, there may not always
be a direct correlation between the statutory key performance measures and the variable remuneration awarded.
Profit for the year attributable to owners
of the Company ($’000)
Basic earnings per share (cents)
Dividend payments ($)
Dividend payout ratio (%)
Share price ($)
Increase/(decrease) in share price (%)
15.4. Directors and KMP remuneration
2023
7,258
2.50
Nil
N/A
0.013
(96.98)
2022
10,218
3.64
Nil
N/A
0.430
(2.27)
2021
8,034
2.89
Nil
N/A
0.440
79.59
2020
3,656
1.45
Nil
N/A
0.245
337.50
2019
1,301
0.58
Nil
N/A
0.056
(3.45)
Details of the nature and amount of each element of the remuneration of each of the KMP of the Company for the year
ended 31 December 2023 are set out in the following tables.
Bonuses paid during the year were based on the achievement of agreed key performance indicators.
The following table of benefits and payments represents the components of the current year and comparative year
remuneration expenses for each member of KMP of the Group. Such amounts have been calculated in accordance with
Australian Accounting Standards.
2023 – Group
Group KMP
Short-term benefits
Salary, fees,
and leave
$
Profit share
& bonuses
$
Non-
monetary
$
Executive Directors
Charles Chen(1)
Ivan Teo(2)
Non-executive directors
Blair Sergeant
Shannon Coates
Martin Zhou(3)
Other KMP
Adam Cui
Yaze Liu
Clive Mann
Graziano Milone
Gaetan Orselli
420,000
212,500
60,000
54,795
-
-
-
-
-
-
61,526
42,613
194,288
166,564
195,878
136,381
-
-
-
-
1,501,932
42,613
-
-
-
-
-
-
-
-
-
-
-
Other
$
-
-
-
-
-
-
-
-
-
-
-
Post-
employment
benefits
Super-
annuation
$
Long-term
benefits
Termination
benefits
Equity-settled share-
based payments
Total
Other
Shares
$
$
$
Options /
Perf. rights
$
$
-
-
-
5,205
-
-
-
-
-
-
5,205
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
96,401
265,643
782,044
89,828
123,872
426,200
-
-
51,964
28,400
-
21,300
151,803
21,300
-
-
-
-
-
-
-
-
60,000
60,000
51,964
132,539
194,288
187,864
347,681
157,681
460,996
389,515
2,400,261
(1) Mr Chen’s Director fees for the year ended 31 December 2023 was USD336,000.
(2) Mr Teo’s Director fees for the year ended 31 December 2023 was USD170,000.
(3) Mr Zhou has agreed to receive his director fees in shares and the Company will seek shareholders’ approval for this issue at the 2024 Annual
General Meeting.
P a g e | 20
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Directors' report
15. Remuneration report (audited)
2022 – Group
Group KMP
Short-term benefits
Salary, fees
and leave
$
Profit share
& bonuses
$
Non-
monetary
$
Executive Directors
Charles Chen(1)
Ivan Teo(2)
Non-executive directors
Blair Sergeant
Shannon Coates(3)
Martin Zhou(4)
Kaijian Chen
Other KMP
Adam Cui
Yaze Liu
Graziano Milone(5)
Gaetan Orselli
Maik Spaan
Jeffrey Wu(6)
420,000
212,500
100,000
76,256
-
-
46,181
98,751
75,838
127,850
122,376
12,829
-
-
-
-
-
-
59,865
26,779
-
-
-
-
1,292,581
86,644
-
-
-
-
-
-
-
-
-
-
-
-
-
Post-
employment
benefits
Super-
annuation
$
-
-
-
7,244
-
-
-
-
-
-
-
-
7,244
Other
$
-
-
-
-
-
-
-
-
-
-
-
-
-
ANNUAL REPORT
31 December 2023
Long-term
benefits
Termination
benefits
Equity-settled share-
based payments
Total
Other
Share
$
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Options /
Perf. rights
$
$
789,488
1,209,488
348,812
561,312
-
-
-
-
-
-
-
-
-
-
100,000
83,500
17,500
28,333
106,046
125,530
219,009
132,725
135,918
20,912
$
-
-
-
-
17,500
28,333
-
-
143,171
4,875
13,542
8,083
215,504
1,138,300
2,740,273
(1) Mr Chen’s Director fees for the year ended 31 December 2022 was USD336,000.
(2) Mr Teo’s Director fees for the year ended 31 December 2022 was USD170,000.
(3) Ms Coates was appointed as Non-Executive Director on 23 May 2014. Ms Coates was appointed Company Secretary to the Company in 2007 and, via
an associated company Evolution Corporate Services Pty Ltd, provided company secretarial, corporate advisory and Australian registered office services
to Vmoto for a monthly retainer until 31 December 2022. Ms Coates resigned as Company Secretary on 30 September 2022. For the 2022 financial year,
the Company paid Evolution Corporate Services Pty Ltd $39,000 for these services, which is not included in the amount above.
(4) Mr Martin Zhou was appointed as Non-Executive Director on 15 September 2022. Mr Zhou has agreed to receive his director fees in shares and the
Company will seek shareholders’ approval for this issue at the 2023 Annual General Meeting.
(5) Mr Graziano Milone was appointed 1 March 2022.
(6) Mr Jeffrey Wu resigned 31 March 2023
15.5. KMP Loans
During the year ended 31 December 2023, there were no loans to or from KMP (2022: nil)
15.6. Other transactions with KMP and or their Related Parties
During the year ended 31 December 2023, there were no other transactions with KMP and their related parties (2022: nil),
other than disclosed below.
Related party
Relationship to Vmoto
Nature of transactions
Charles Chen
Managing Director
Unpaid remuneration or fees
Ivan Teo
Finance Director
Unpaid remuneration or fees
Martin Zhou
Non-executive Director Unpaid remuneration or fees
Graziano Milone
Member of KMP
Unpaid remuneration or fees
Receivable/(payable) balance
2023
$
(93,148)
(77,131)
(40,000)
(98,553)
2022
$
(27,500)
(25,625)
(17,500)
-
P a g e | 21
ANNUAL REPORT
31 December 2023
Directors' report
15. Remuneration report (audited)
15.7. Share-based compensation
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
The Group believes that encouraging its directors and executives to become shareholders is the best way of aligning their
interests with those of its shareholders. At present the Group does not have an active employee share option plan.
There were no equity instruments issued during the year to Directors as a result of options exercised that had previously been
granted as compensation.
a. Securities received that are not performance-related
Members of KMP are entitled to receive securities that are not performance-based, in settlement of all or part of their
remuneration.
b. Options Granted as Remuneration
The Company operates an Employee Long Term Incentive Plan (LTI Plan) for eligible persons of the Group. In accordance
with the provisions of the LTI Plan, eligible persons may be granted options to purchase ordinary shares at an exercise price
to be determined by the Board with regard to the market value of the shares when it resolves to offer the options. The
options may only be granted to eligible persons after the Board considers the person’s seniority, position, length of service,
record of employment, potential contribution and any other matters which the Board considers relevant.
Each employee share option converts into one ordinary share of Vmoto Limited on exercise. No amounts are paid or
payable to the Company by the recipient on receipt of the option. The options carry neither rights to dividends nor voting
rights. Options may be exercised at any time from the date of vesting to the date of their expiry.
The number of options granted is determined by the Board.
There is no further service or performance criteria that need to be met in relation to options granted before the beneficial
interest vests in the recipient.
No options were granted the KMP during the current financial year (2022: nil).
c. Rights Granted as Remuneration
In accordance with the provisions of the LTI Plan, eligible persons may be granted rights to attract, motivate and retain key
directors, employees and consultants to participate in the future growth of the Company to be determined by the Board
and on the terms set out in the rules of the LTI plan. The rights may only be granted to eligible persons after the Board
considers the person’s seniority, position, length of service, record of employment, potential contribution and any other
matters which the Board considers relevant.
Each right converts into one ordinary share of Vmoto Limited at nil consideration when service and performance-based
conditions as determined by the Board are met within designated period. No amounts are paid or payable to the Company
by the recipient on receipt of the rights or on conversion of the rights to shares. Rights carry neither rights to dividends nor
voting rights.
Rights under the LTI Plan expire when the applicable service and/or performance conditions are not met within the
designated period, or immediately on the resignation of the eligible persons, whichever is the earlier.
The number of rights granted is determined by the Board. Unless specified by the Board at the time of offer of rights, there
are no further service or performance criteria that need to be met in relation to rights granted before
During the year, the Company issued Messrs Chen and Teo 2,873,372 rights that will convert into shares upon milestones
being achieved. These rights have been issued on terms as detailed below and valued in accordance with note 21.2.2c.
Performance Condition
Class of
Performance
Right
2023 Continuing employment;
Minimum performance hurdle of a
minimum share price compound annual
growth rate (CAGR) increases of 5% over the
performance period;
No performance rights will vest if CAGR is
less than 5% over the respective period; and
50% of the performance rights will vest if
CAGR of 10% is achieved, up to maximum of
100% of the performance rights will vest if
CAGR of 15% is achieved and pro rata of the
performance rights will vest if CAGR is
>5%&<10% and >10%&<15%.
Performance
rights
No.
Milestone
Date
Expiry
Date
Probability of
milestones met
%
Performance
Condition
Satisfied
2,873,372
31.12.2025 30.05.2026 100% for the
Nil
service
condition.
Other
milestones are
market
conditions and
determined
through a
Monte Carlo
simulation.
P a g e | 22
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Directors' report
15. Remuneration report (audited)
15.8. KMP equity holdings of Vmoto Limited held by each KMP
a. Fully Paid Ordinary Shares
ANNUAL REPORT
31 December 2023
The number of ordinary shares of Vmoto Limited held, directly, indirectly or beneficially, by each KMP, including their
personally-related entities for the year ended 31 December 2023 is as follows:
Balance at start of
year or
appointment
No.
Received during
the year as
compensation
No.
Received during the
year on the exercise
of options
No.
Other changes
during the year(1)
No.
Balance at end of
year or resignation
No.
2023 – Group
Group KMP
Executive Directors
Charles Chen
Ivan Teo
Non-executive directors
Blair Sergeant
Shannon Coates
Martin Zhou
Other KMP
Adam Cui
Yaze Liu
Clive Mann
Graziano Milone
Gaetan Orselli
36,655,779
3,086,122
140,000
497,929
150,549
140,285
-
-
12,164,812
357,142
-
-
-
1,000,000
50,000
80,000
-
60,000
438,139
60,000
-
-
-
-
-
-
-
-
-
-
-
9,201,582
848,593
46,007,910
4,075,000
160,000
124,482
300,000
622,411
3,067,988
15,589,942
-
-
-
-
-
80,000
-
60,000
1,438,139
110,000
13,402,645
68,283,402
(1) Other changes relate to the acquisition of shares on market during the year.
53,594,642
1,286,115
b. Options
The number of options over ordinary shares in Vmoto Limited held, directly, indirectly or beneficially, by each KMP,
including their personally-related entities for the year ended 31 December 2023 is as follows:
Balance at
start of year or
appointments
No.
Granted as
Remuneration
during the year
No.
Exercised
during the year
No.
Other changes
during the year
No.
Balance at
end of year or
resignation
No.
Vested and
Exercisable
No.
Not Vested
No.
-
-
-
-
-
-
-
-
2,100,000
-
2,100,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,100,000
2,100,000
-
-
2,100,000
2,100,000
-
-
-
-
-
-
-
-
-
-
-
2023 – Group
Group KMP
Executive Directors
Charles Chen
Ivan Teo
Non-executive directors
Blair Sergeant
Shannon Coates
Martin Zhou
Other KMP
Adam Cui
Yaze Liu
Clive Mann
Graziano Milone
Gaetan Orselli
P a g e | 23
ANNUAL REPORT
31 December 2023
Directors' report
15. Remuneration report (audited)
c. Performance Rights
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
The number of Performance Shares in Vmoto Limited held, directly, indirectly, or beneficially, by each KMP, including
their personally-related entities for the year ended 31 December 2023 is as follows:
Balance at
start of year or
appointments
No.
Received during
the year as
compensation
No.
Conversion to
ordinary share
during the year
No.
Expiration of
rights during the
year
No.
Balance at
end of year or
resignation
No.
Maximum value
yet to vest
No.
2023 – Group
Group KMP
Executive Directors
Charles Chen
Ivan Teo
Non-executive directors
Blair Sergeant
Shannon Coates
Martin Zhou
Other KMP
Adam Cui
Yaze Liu
Clive Mann
Graziano Milone
Gaetan Orselli
2,693,054
1,201,976
1,903,609
969,763
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1,320,708)
(549,464)
3,275,955
1,622,275
3,275,955
1,622,275
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(1,870,172)
4,898,230
4,898,230
3,895,030
2,873,372
15.9. Other Equity-related KMP Transactions
There have been no other transactions involving equity instruments other than those described in the tables above relating
to options, rights, and shareholdings.
E N D O F R E M U N E R AT I O N R E P O R T
This Report of the Directors, incorporating the Remuneration Report, is signed in accordance with a resolution of the Board of
Directors made pursuant to section 298(2) of the Corporations Act 2001 (Cth).
CHARLES CHEN
Managing Director
Dated this Wednesday, 27 March 2024
P a g e | 24
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
ANNUAL REPORT
31 December 2023
Auditor's independence declaration
Under section 307c Of The Corporations Act 2001 (Cth)
To The Directors Of VMOTO LIMITED
TO BE RECEIVED FROM
AUDITORS
P a g e | 25
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Consolidated statement of profit or loss and other comprehensive income
for the year 31 December 2023
Continuing operations
Revenue
Cost of sales
Gross profit
Other income
Operational expenses
Marketing and distribution expenses
Corporate and administrative expenses
Occupancy expenses
Other expenses
Operating profit
Note
2023
$’000
2022
$’000
69,248
(48,814)
116,673
(85,212)
20,434
31,461
1.1
7,919
3,440
(13,639)
(1,975)
(4,942)
(466)
(52)
(10,642)
(2,135)
(5,294)
(234)
(4,283)
7,279
12,313
(456)
(175)
840
7,488
(230)
7,258
-
(3,161)
(3,161)
4,097
10
7,248
10
4,087
(1,323)
(23)
433
11,400
(1,182)
10,218
-
54
54
10,272
(51)
10,269
(51)
10,323
Share of profit or (loss) from equity accounted investments
12.3.2
Finance costs
Finance income
Profit before tax
Income tax expense
Profit for the year
2.1
4.1
Other comprehensive income, net of income tax
Items that will not be reclassified subsequently to profit or loss:
Items that may be reclassified subsequently to profit or loss:
Foreign currency translation differences
Other comprehensive income for the year, net of tax
Total comprehensive income attributable to members of the parent entity
Profit or (loss) for the year attributable to:
Non-controlling interest
Owners of the parent
Total comprehensive income attributable to:
Non-controlling interest
Owners of the parent
Earnings per share:
Basic earnings per share (cents per share)
Diluted earnings per share (cents per share)
20.4
20.4
₵
2.50
2.31
7,688
₵
3.64
3.43
12,300
The consolidated statement of profit or loss and other comprehensive income is to be read in conjunction with the accompanying notes.
P a g e | 26
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Consolidated statement of financial position
as at 31 December 2023
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other current assets
Total current assets
Non-current assets
Trade and other receivables
Property, plant, and equipment
Right-of-use assets
Intangible assets
Investments accounted for using equity method
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Borrowings
Current tax liabilities
Leases
Total current liabilities
Non-current liabilities
Leases
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Non-controlling interest
Total equity
Note
5.1
5.2.1
6.1
5.3.1
5.2.2
6.2
6.3.1
6.4
12.1
5.4
5.5.1
4.5
6.3.2
6.3.2
7.1.1
7.3
ANNUAL REPORT
31 December 2023
2023
$’000
42,524
9,220
16,145
5,047
72,936
2,277
8,014
4,694
2,787
5,609
2022
$’000
28,026
17,470
13,508
9,923
68,927
-
5,156
1,002
-
5,901
23,381
12,059
96,317
80,986
11,520
4,120
-
257
15,897
923
923
21,701
-
474
110
22,285
165
165
16,820
22,450
79,497
58,536
-
109,841
(1,903)
(28,326)
(115)
79,497
57,039
72,016
-
91,908
2,327
(35,574)
(125)
58,536
46,642
57,534
The consolidated statement of financial position is to be read in conjunction with the accompanying notes.
P a g e | 27
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Consolidated statement of changes in equity
for the year 31 December 2023
Note
Contributed
equity
$’000
Accumulated
losses
$’000
Share-based
payment
reserve
$’000
Foreign
currency
translation
reserve
$’000
Non-controlling
Interests
$’000
Balance at 1 January 2022
90,559
(45,843)
974
Profit for the year attributable to owners of the
parent
Other comprehensive income for the year
attributable owners of the parent
Total comprehensive income for the year
attributable owners of the parent
Transaction with owners, directly in equity
Shares issued during the year (net of costs)
Performance rights granted during the year
Options issued during the year
Vesting of performance rights and shares
7.1
21.1
7.2.1b
7.1.1k
-
-
-
1,043
-
-
306
10,269
-
10,269
-
-
-
-
-
-
-
-
1,085
99
(306)
Total
equity
$’000
46,037
10,218
(74)
(51)
-
54
421
-
54
54
(51)
10,272
-
-
-
-
-
-
-
-
1,043
1,085
99
-
Balance at 31 December 2022
91,908
(35,574)
1,852
475
(125)
58,536
Balance at 1 January 2023
91,908
(35,574)
1,852
Profit for the year attributable to owners of the
parent
Other comprehensive income- for the year
attributable owners of the parent
Total comprehensive income for the year
attributable owners of the parent
Transaction with owners, directly in equity
Shares issued during the year (net of costs)
7.1
Shares issued during the year in lieu of cash
7.1.1g to
7.1.1j
Share-based payments granted during the year
21.2.2
Vesting of performance rights and shares
Lapse of options
7.1.1e & f
7.1.1k,7.2
7.2.1b
-
-
-
15,755
219
-
1,959
-
7,248
-
7,248
-
-
-
-
-
-
-
-
390
(1,360)
(99)
475
-
(125)
10
58,536
7,258
(3,161)
-
(3,161)
(3,161)
10
4,097
-
-
-
-
-
-
15,755
219
390
599
(99)
-
-
-
-
-
Balance at 31 December 2023
109,841
(28,326)
783
(2,686)
(115)
79,497
The consolidated statement of changes in equity is to be read in conjunction with the accompanying notes.
P a g e | 28
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Consolidated statement of cash flows
for the year 31 December 2023
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Interest paid
Other cash receipts
Income tax paid
Note
Net cash provided by operating activities
5.1.2a
Cash flows from investing activities
Purchase of property, plant, and equipment
Purchase of intangibles
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Proceeds from borrowings
Payment of principal portion of lease liabilities
Net cash provided by / (used in) financing activities
Net increase in cash and cash equivalents held
Cash and cash equivalents at the beginning of the year
Change in foreign currency held
5.1.2b
5.1.2b
Cash and cash equivalents at the end of the year
-
-
5.1
The consolidated statement of cash flows is to be read in conjunction with the accompanying notes.
ANNUAL REPORT
31 December 2023
2023
$’000
71,776
(70,600)
845
(133)
2,009
(30)
3,867
(6,136)
(2,875)
(9,011)
15,787
4,187
(295)
19,679
14,535
28,026
(37)
42,524
2022
$’000
117,126
(111,676)
433
-
3,623
-
9,506
(662)
-
(662)
529
-
(156)
373
9,217
18,634
175
28,026
P a g e | 29
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year 31 December 2023
In preparing the 2023 financial statements, Vmoto Limited has grouped into sections under the following key categories:
Section A: How the numbers are calculated ............................................................................................................................. 31
Section B: Risk ........................................................................................................................................................................... 49
Section C: Group structure ........................................................................................................................................................ 55
Section D: Unrecognised items ................................................................................................................................................. 60
Section E: Other Information .................................................................................................................................................... 61
Significant accounting policies specific to each note are included within that note. Accounting policies that are determined to be non-
significant are not included in the financial statements.
The financial report is presented in Australian dollars, except where otherwise stated.
The amounts contained in these financial statements have been rounded to the nearest thousand dollars under the option available
to the Group under Australian Securities and Investments Commission (ASIC) Corporations (Rounding in Financial/Directors’ Reports)
Instrument 2016/191 dated 24 March 2016.
P a g e | 30
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
ANNUAL REPORT
31 December 2023
SECTION A. HOW THE NUMBERS ARE CALCULATED
This section provides additional information about those individual line items in the financial statements that the Directors
consider most relevant in the context of the operations of the Group.
Note 1
Revenue and other income
1.1 Other Income
Contributions from customers
Government subsidies
Recovery of loss allowance
Rent income
Net foreign exchange gain
Other income
1.2
Accounting policies
1.2.1 Revenue recognition
Note
5.2.5
2023
$’000
3,128
767
2,431
1,035
514
44
7,919
2022
$’000
1,495
606
-
512
774
53
3,440
Revenues are recognised at fair value of the consideration received net of the amount of value added tax (GST, VAT or
equivalent) payable to the taxation authority.
1.2.2 Sale of goods
Revenue is measured when or as the control of the goods or services is transferred to a customer. Depending on the terms
of the contract and the laws that apply to the contract, control of the goods and services may be transferred over time or at
a point in time.
If control of the goods and services transfers over time, revenue is recognised over the period of the contract by reference
to the progress towards complete satisfaction of that performance obligation. Otherwise (and in most instances), revenue
is recognised at a point in time when the customer obtains control of the goods and services.
Contracts with customers may include multiple performance obligations. For such arrangements, the Company allocates
revenue to each performance obligation based on its relative standalone selling price which are generally based on the prices
charged to customers. If the standalone selling price is not directly observable, it is estimated using expected cost plus a
margin or adjusted market assessment approach, depending on the availability of observable information.
If a customer pays consideration before the Company transfers the goods to the customer, the Company presents the
contract liability (referred to as advance and deposits from customers) when the payment is made. A contract liability is the
Company's obligation to transfer goods or services to a customer for which the Company has received consideration.
1.2.3
Interest income
Interest revenue is recognised in accordance with note 3.1 Finance income and expenses.
Note 2
Expenses
2.1
Expenses by nature
Advertising and promotion expenses
Manufacturing and production costs
Consultancy and compliance expenses
Depreciation and amortisation
Doubtful debts expenses
Freight and couriers
Interest and finance costs
Salaries and employment costs
Research and development
Other expenses
Note
2.2
5.2.5
Share of (profit) or loss from equity accounted investments
12.3.2
2023
$’000
1,239
50,085
2,305
865
52
2,071
243
6,708
4,166
2,329
456
2022
$’000
1,767
85,292
2,165
1,310
4,283
2,797
94
5,141
3,480
1,494
1,323
Total expenses by nature
70,519
109,146
P a g e | 31
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 2
Expenses (cont.)
2.1.1 Reconciliation to net profit or loss before tax
Total revenue and other income
Less: Total expenses by nature
Net loss / (profit) before tax
2.2
Depreciation and amortisation
Depreciation – plant and equipment
Depreciation – right-of-use assets
Amortisation – intangible assets
2.3
Accounting policies
2.3.1
2.3.2
Impairment of financial assets
Refer to note 5.6.1d
Impairment of non-financial assets
Refer to note 6.5.1
2.3.3 Employee benefits:
a. Short-term benefits
2023
$’000
78,007
(70,519)
2022
$’000
120,546
(109,146)
7,488
11,400
-
-
Note
6.2.1
6.3.4
6.4.1
2023
$’000
629
236
-
865
2022
$’000
888
422
-
1,310
Liabilities for employee benefits for wages, salaries, and annual leave that are expected to be settled within 12 months
of reporting date are present obligations resulting from employees' services provided to the reporting date and are
calculated at undiscounted amounts based on remuneration wage and salary rates that the Group expects to pay at the
reporting date including related on-costs, such as workers compensation insurance and payroll tax.
Non-accumulating non-monetary benefits, such as medical care, housing, cars and free or subsidised goods and services,
are expensed based on the net marginal cost to the Group as the benefits are taken by the employees.
b. Other long-term benefits
The Group's obligation in respect of long-term employee benefits other than defined benefit plans, such as long service
leave, is the amount of future benefit that employees have earned in return for their service in the current and prior
periods plus related on-costs; that benefit is discounted to determine its present value, and the fair value of any related
assets is deducted. The discount rate is the Reserve Bank of Australia's cash rate at the report date that have maturity
dates approximating the terms of the Company's obligations. Any actuarial gains or losses are recognised in profit or loss
in the period in which they arise.
c. Retirement benefit obligations: Defined contribution superannuation funds
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions onto a
separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to
defined contribution superannuation funds are recognised as an expense in the income statement as incurred.
d. Termination benefits
When applicable, the Group recognises a liability and expense for termination benefits at the earlier of: (a) the date
when the Group can no longer withdraw the offer for termination benefits; and (b) when the Group recognises costs for
restructuring pursuant to AASB 137 Provisions, Contingent Liabilities and Contingent Assets and the costs include
termination benefits. In either case, unless the number of employees affected is known, the obligation for termination
benefits is measured based on the number of employees expected to be affected. Termination benefits that are expected
to be settled wholly before 12 months after the annual reporting period in which the benefits are recognised are
measured at the (undiscounted) amounts expected to be paid. All other termination benefits are accounted for on the
same basis as other long-term employee benefits.
P a g e | 32
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 2
Expenses (cont.)
2.3
Accounting policies (cont.)
e. Equity-settled compensation
ANNUAL REPORT
31 December 2023
The fair value of options granted is recognised as an employee expense with a corresponding increase in equity. The fair
value is measured at grant date and spread over the period during which the employees become unconditionally entitled
to the options. The fair value of the options granted is measured using the Black-Scholes pricing model, considering the
terms and conditions upon which the options were granted. The amount recognised is adjusted to reflect the actual
number of share options that vest except where forfeiture is only due to market conditions not being met.
Note 3 Other Significant Accounting Policies related to items of profit and loss
3.1
Finance income and expenses
Finance income comprises interest income on funds invested (including available-for-sale financial assets), gains on the
disposal of available-for-sale financial assets and changes in the fair value of financial assets at fair value through profit or
loss. Interest revenue is recognised on a time proportionate basis that considers the effective yield on the financial asset.
Financial expenses comprise interest expense on borrowings calculated using the effective interest method, unwinding of
discounts on provisions, changes in the fair value of financial assets at fair value through profit or loss and impairment losses
recognised on financial assets. All borrowing costs are recognised in profit or loss using the effective interest method.
Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a
substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until such time as
the assets are substantially ready for their intended use or sale. All other borrowing costs are recognised in income in the
period in which they are incurred.
Note 4
Income tax
4.1
Income tax expense
Current tax expense
Deferred tax expense
Note
Deferred income tax expense included in income tax expense comprises:
Increase in deferred tax assets (DTAs)
4.6
Increase / (decrease) in deferred tax liabilities (DTLs)
4.2
Reconciliation of income tax expense to prima facie tax
payable
The prima facie tax benefit on profit or loss from ordinary activities before
income tax is reconciled to the income tax expense as follows:
Accounting profit before tax
Prima facie tax on operating profit at 30% (2022 profit: 30%)
Add / (Less) tax effect of:
Non-deductible expenses
Effect of different tax rates of subsidiaries operating in other
jurisdictions
Deferred tax assets not brought to account
Income tax expense attributable to operating profit
2023
$’000
230
-
230
-
-
-
7,488
2,246
241
(1,755)
(502)
230
2022
$’000
1,182
-
1,182
-
-
-
11,400
3,420
557
(2,380)
(415)
1,182
P a g e | 33
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 4
Income tax (cont.)
4.3
The applicable weighted average effective tax rates attributable to
operating profit are as follows:
a. The potential tax benefit for 2023 in respect of tax losses not brought
into account has been calculated at 30% for Australian entities (2022:
30%). The tax benefit and expense for 2023 in respect of tax effect
brought into account in relation to China operations has been calculated
at 15% for China entities and 0% for Honk Kong. The tax benefit and
expense for 2023 in respect of tax effect brought into account in relation
to Europe operations has been calculated at following rates: The
Netherlands – 25.8%; Italy – 24%; and the UK – 25%.
4.4
Balance of franking account at year end of the parent company
4.5
Current tax liabilities
Income taxes payable
4.6
Deferred tax assets (DTA)
Note
Accrued expenses
Unused tax losses
Net DTAs
Less: DTAs not recognised
Net deferred tax assets
4.7
Tax losses and deductible temporary differences
Unused tax losses and deductible temporary differences for which no DTA
has been recognised, that may be utilised to offset tax liabilities:
Revenue losses attributable to Australia
2023
%
3.07
2022
%
10.37
$nil
2023
$’000
-
-
2023
$’000
20
7,240
7,260
$nil
2022
$’000
474
474
2022
$’000
20
7,080
7,100
(7,260)
(7,100)
-
-
7,240
7,240
7,080
7,080
4.8
Potential DTAs attributable to tax losses have not been brought to account at 31 December 2023 because the Directors
do not believe it is appropriate to regard realisation of the deferred tax assets as probable at this point in time. These
benefits will only be obtained if:
i.
the Group derives future assessable income of a nature and of an amount sufficient to enable the benefit from the
deductions for the loss to be realised;
ii. the Company continues to comply with conditions for deductibility imposed by law; and
iii. no changes in tax legislation adversely affect the Group in realising the benefit from the deductions for the loss.
Balances disclosed in the financial statements and the notes thereto, related to taxation, are based on the best estimates
of the Directors. These estimates consider both the financial performance and position of the Company as they pertain
to current income taxation legislation, and the Directors understanding thereof. No adjustment has been made for
pending or future taxation legislation. The current income tax position represents that Directors' best estimate, pending
an assessment by tax authorities in relevant jurisdictions.
The Group has accumulated tax losses of $24,133K (2022: $23,600K) which may be available for offset against future
taxable profits of the parent company in which the losses arose. The recoupment of these losses is subject to assessment
by the Australian Taxation Office.
P a g e | 34
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 4
Income tax (cont.)
4.9
Accounting policy
ANNUAL REPORT
31 December 2023
4.9.1
Income tax
The income tax expense or benefit for the period is the tax payable on the current period's taxable income based on the
applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to
temporary difference and to unused tax losses.
The current income tax charge is calculated based on the jurisdictional tax laws enacted or substantively enacted at the end
of the reporting period being where the Group and its associates operate and generate taxable income. Management
periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to
interpretation. It establishes provisions where appropriate based on amounts expected to be paid to the tax authorities.
4.9.2 Current tax
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered
from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted
or substantively enacted by the balance date, in Australia.
4.9.3 Deferred tax
Deferred income tax is provided on all temporary differences at the balance date between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities (DTL) are recognised for all taxable temporary differences except:
when the DTL arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business
combination and that, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; or
when the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint
ventures, and the timing of the reversal of the temporary difference can be controlled and it is probable that the
temporary difference will not reverse in the foreseeable future.
Deferred income tax assets (DTA) are recognised for all deductible temporary differences, carry-forward of unused tax assets
and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences and the carry-forward of unused tax credits and unused tax losses can be utilised, except:
when the DTA relating to the deductible temporary difference arises from the initial recognition of an asset or liability in
a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit
nor taxable profit or loss; or
when the deductible temporary difference is associated with investments in subsidiaries, associates or interests in joint
ventures, in which case a DTA is only recognised to the extent that it is probable that the temporary difference will reverse
in the foreseeable future and taxable profit will be available against which the temporary difference can be utilised.
The carrying amount of DTA is reviewed at each balance date and reduced to the extent that it is no longer probable that
sufficient taxable profit will be available to allow all or part of the DTA to be utilised.
Unrecognised DTA are reassessed at each balance date and are recognised to the extent that it has become probable that
future taxable profit will allow the deferred tax asset to be recovered. DTAs and DTLs are measured at the tax rates that are
expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have
been enacted or substantively enacted at the balance date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss. DTAs and DTLs
are offset only if a legally enforceable right exists to set off current tax assets against current tax liabilities and the DTAs and
DTLs relate to the same taxable entity and the same taxation authority.
P a g e | 35
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 5
Financial assets and financial liabilities
5.1
Cash and cash equivalents
Cash at bank
2023
$’000
42,524
42,524
2022
$’000
28,026
28,026
5.1.1 The Group's exposure to interest rate risk and a sensitivity analysis for financial assets and liabilities are disclosed in note
8 Financial risk management.
5.1.2 Cash Flow Information
a. Reconciliation of cash flow from operations to loss after income tax
Profit / (loss) after income tax
Cash flows excluded from loss attributable to operating activities
Non-cash flows in loss from ordinary activities:
Depreciation and amortisation
Share-based payments expense
Other non-cash (gains)/losses
Changes in assets and liabilities, net of the effects of purchase and
disposal of subsidiaries:
(Increase) or decrease in trade and other receivables
(Increase) or decrease in inventories
(Increase) or decrease in other assets
Increase or (decrease) in trade and other payables
(Decrease) in tax balances
Cash flow from operations
b. Reconciliation of liabilities arising from financing activities
Note
21
-
2023
$’000
7,258
-
865
1,208
(3,156)
3,031
(2,953)
5,990
(7,902)
(474)
3,867
-
2021
$’000
Cash flows
$’000
Additions
$’000
Non-cash changes
Other
Changes
$’000
Change due to
FX rates
$’000
Converted
to equity
$’000
Leases
431
(156)
Total liabilities from
financing activities
431
(156)
-
-
-
-
-
-
-
-
Short-term borrowings
Leases
Total liabilities from
financing activities
2022
$’000
Cash flows
$’000
Additions
$’000
-
275
4,187
(295)
-
1,202
275
3,892
1,202
-
c. Credit and loan standby arrangement with banks
Refer note 5.5.4 Financing facilities available.
d. Non-cash investing and financing activities
Non-cash changes
Other
Changes
$’000
Change due to
FX rates
$’000
Converted
to equity
$’000
-
-
-
(67)
(2)
(69)
-
-
-
During the year there were no non-cash investing and financing activities (2022: none)
2022
$’000
10,218
-
1,310
1,658
-
(2,657)
(980)
(6,076)
6,033
-
9,506
-
2022
$’000
275
275
-
2023
$’000
4,120
1,180
5,300
-
P a g e | 36
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 5
Financial assets and financial liabilities (cont.)
5.1
Cash and cash equivalents (cont.)
5.1.3 Accounting policy
ANNUAL REPORT
31 December 2023
For Statement of Cash Flow presentation purposes, cash and cash equivalents includes cash on hand, deposits held at call
with financial institutions, other short-term, highly liquid instruments with original maturities of three months or less that
are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank
overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the Statement of Financial Position.
5.2
Trade and other receivables
5.2.1 Current
Trade debtors
Less: Loss allowance
Other receivables
5.2.2 Non-current
Other receivables
Note
5.2.5
2023
$’000
7,639
-
1,581
9,220
2,277
2,277
2022
$’000
13,408
(4,524)
8,586
17,470
-
-
a. Other receivables are due for repayment in August 2025 interest charged at 4% per annum
5.2.3 The Group's exposure to credit rate risk is disclosed in note 8 Financial risk management.
5.2.4 Trade receivables are non-interest bearing and are generally on 30-60 days terms. A provision for expected credit losses
is by reference to past default experience and an analysis of the ageing and known financial position of the debtor. The
Company writes off a receivable when there is information indicating that the debtor is in severe financial difficulty and
there is no realistic prospect of recovery.
5.2.5 The loss allowance related to the bankruptcy of a Dutch B2B customer, and was fully provided for in 2022. In the current
year, the Group recovered US$1.6 million of stock and US$0.5 million in a settlement, resulting in the recovery of loss
allowance of A$2.43 million.
5.2.6 Accounting policy
Trade and other receivables include amounts due from customers for goods sold in the ordinary course of business.
Receivables expected to be collected within 12 months of the end of the reporting period are classified as current assets. All
other receivables are classified as non-current assets.
Trade and other receivables are initially recognised at fair value and subsequently measured at amortised cost using the
effective interest method, less any provision for impairment.
a. Determining the stage for impairment
At each reporting date, the Group assesses whether there has been a significant increase in credit risk for exposures since
initial recognition by comparing the risk of default occurring over the remaining expected life from the reporting date
and the date of initial recognition. The Group considers reasonable and supportable information that is relevant and
available without undue cost or effort for this purpose. This includes quantitative and qualitative information and also,
forward-looking analysis.
An exposure will migrate through the expected credit loss (ECL) stages as asset quality deteriorates. If, in a subsequent
period, asset quality improves and also reverses any previously assessed significant increase in credit risk since
origination, then the provision for doubtful debts reverts from lifetime ECL to 12-months ECL. Exposures that have not
deteriorated significantly since origination are considered to have a low credit risk. The provision for doubtful debts for
these financial assets is based on a 12-months ECL. When an asset is uncollectible, it is written off against the related
provision. Such assets are written off after all the necessary procedures have been completed and the amount of the loss
has been determined. Subsequent recoveries of amounts previously written off reduce the amount of the expense in the
Consolidated Statement of Profit or Loss and Other Comprehensive Income.
The Group assesses whether the credit risk on an exposure has increased significantly on an individual or collective basis.
For the purposes of a collective evaluation of impairment, financial instruments are accompanied on the basis of shared
credit risk characteristics, taking into account instrument type, credit risk ratings, date of initial recognition, remaining
term to maturity, industry, geographical location of the borrower and other relevant factors
P a g e | 37
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 5
Financial assets and financial liabilities (cont.)
5.3 Other assets
5.3.1 Current
Advances to suppliers
Other current assets
Note
5.3.1a
2023
$’000
3,845
1,202
5,047
2022
$’000
9,923
-
9,923
a. Advance to suppliers are for the supply of electric motorcycle/moped inventories for the Group’s electric two-wheel
vehicle operations.
5.4
Trade and other payables
5.4.1 Current
Trade creditors
Advances and deposits from customers / unearned revenue
Other creditors and accruals
Bank acceptance draft
Shareholder advances
5.4.3 Accounting policy
a. Trade and other payables
2023
$’000
2,567
6,244
2,709
-
-
2022
$’000
7,386
9,701
3,346
1,150
118
11,520
21,701
These amounts represent liabilities for goods and services provided to the Group prior to the end of financial year which
are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other payables are
presented as current liabilities unless payment is not due within 12 months.
b. Advance and deposits from customers / unearned revenue
The Group recognises advances and deposit payments received from customers as liabilities until the related goods are
delivered, at which point amounts will be recognised as revenue.
5.5
Borrowings
5.5.1 Current
Bank loans
5.5.2 The Industrial and Commercial Bank of China bank loan:
Facility
Term
Interest Rate
RMB 20 million
1 year
3.3% fixed
Establishment / Extension Fee Minimal
Financial Covenants
None
Note
5.5.2
2023
$’000
4,120
4,120
2022
$’000
-
-
Subsequent to year end, in January 2024, the Group repaid this facility in full. As at the date of this report, the Company
has no bank debt.
5.5.3 Assets pledged as security
No assets have been pledged as security.
P a g e | 38
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 5
Financial assets and financial liabilities (cont.)
ANNUAL REPORT
31 December 2023
5.5
Borrowings (cont.)
5.5.4 Financing facilities available
At balance date, the following
financing facilities had been
negotiated and were available:
Bank and other loans
Total facilities at balance date
5.5.5 Accounting policy
a. Borrowings
Total facilities
2023
$’000
2022
$’000
Facilities used
2023
$’000
2022
$’000
4,120
4,120
-
-
(4,120)
(4,120)
-
-
Facilities unused
2023
$’000
-
-
2022
$’000
-
-
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently
measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption
amount is recognised in profit or loss over the period of the borrowings using the effective interest method. Fees
paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is
probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down
occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the
fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates.
Borrowings are removed from the statement of financial position when the obligation specified in the contract is
discharged, cancelled, or expired. The difference between the carrying amount of a financial liability that has been
extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred
or liabilities assumed, is recognised in profit or loss as other income or finance costs. Borrowings are classified as
current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months
after the reporting period.
5.6 Other Significant Accounting Policies related to Financial Assets and Liabilities
5.6.1
Investments and other financial assets
a. Classification
The Group classifies its financial assets in the following measurement categories:
those to be measured subsequently at fair value (either through OCI or through profit or loss), and
those to be measured at amortised cost.
The classification depends on the entity’s business model for managing the financial assets and the contractual terms
of the cash flows.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI. For investments in
equity instruments that are not held for trading, this will depend on whether the group has made an irrevocable
election at the time of initial recognition to account for the equity investment at fair value through other
comprehensive income (FVOCI).
The Group reclassifies debt investments when and only when its business model for managing those assets changes.
b. Recognition and derecognition
Regular way purchases and sales of financial assets are recognised on trade-date, the date on which the Group
commits to purchase or sell the asset. Financial assets are derecognised when the rights to receive cash flows from
the financial assets have expired or have been transferred and the Group has transferred substantially all the risks
and rewards of ownership.
P a g e | 39
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 5
Financial assets and financial liabilities (cont.)
5.6 Other Significant Accounting Policies related to Financial Assets and Liabilities (cont.)
c. Measurement
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at
fair value through profit or loss (FVPL), transaction costs that are directly attributable to the acquisition of the
financial asset. Transaction costs of financial assets carried at FVPL are expensed in profit or loss. Financial assets
with embedded derivatives are considered in their entirety when determining whether their cash flows are solely
payment of principal and interest.
i. Debt instruments
Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset
and the cash flow characteristics of the asset. There are three measurement categories into which the Group
classifies its debt instruments:
Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent
solely payments of principal and interest are measured at amortised cost. Interest income from these
financial assets is included in finance income using the effective interest rate method. Any gain or loss arising
on derecognition is recognised directly in profit or loss and presented in other gains/(losses). Impairment
losses are presented as separate line item in the statement of profit or loss.
FVOCI: Assets held for collection of contractual cash flows and for selling the financial assets, where the
assets’ cash flows represent solely payments of principal and interest, are measured at FVOCI. Movements
in carrying amounts are taken through OCI, except for the recognition of impairment gains or losses, interest
income and foreign exchange gains and losses which are recognised in profit or loss. When a financial asset
is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit
or loss and recognised in other gains/(losses). Interest income from these financial assets is included in
finance income using the effective interest rate method. Foreign exchange gains and losses are presented in
other gains/(losses) and impairment expenses are presented separately in the statement of profit or loss.
FVPL: Assets that do not meet the criteria for amortised cost or FVOCI are measured at FVPL. A gain or loss
on a debt investment that is subsequently measured at FVPL is recognised in profit or loss and presented net
within other gains/(losses) in the period in which it arises.
ii. Equity instruments
The Group subsequently measures all equity investments at fair value. Where the group’s management has
elected to present fair value gains and losses on equity investments in OCI, there is no subsequent reclassification
of fair value gains and losses to profit or loss following the derecognition of the investment. Dividends from such
investments continue to be recognised in profit or loss as other income when the group’s right to receive
payments is established.
Changes in the fair value of financial assets at FVPL are recognised in other gains/(losses) in the statement of
profit or loss as applicable. Impairment losses (and reversal of impairment losses) on equity investments
measured at FVOCI are not reported separately from other changes in fair value.
d. Impairment
The Group assesses on a forward-looking basis, the expected credit losses associated with its debt instruments carried
at amortised cost and FVOCI. The impairment methodology applied depends on whether there has been a significant
increase in credit risk.
For trade receivables, the Group applies the simplified approach permitted by AASB 9, which requires expected lifetime
losses to be recognised from initial recognition of the receivables.
P a g e | 40
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 6
Non-financial assets and financial liabilities
6.1
Inventories
Raw materials
Work-in-progress
Finished goods
6.1.1 Accounting policy
ANNUAL REPORT
31 December 2023
2023
$’000
3,525
-
12,620
16,145
2022
$’000
4,557
485
8,466
13,508
Inventories are measured at the lower of cost and net realisable value. The cost of inventories includes expenditure incurred
in acquiring the inventories, production or conversion costs and other costs incurred in bringing them to their existing
location and condition.
Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion
and selling expenses.
2023
$’000
4,664
(2,055)
2,609
415
(238)
177
-
9,089
(3,861)
5,228
8,014
Buildings
$’000
4,079
48
-
(500)
(72)
3,555
6.2
Property, plant, and equipment
Plant and equipment – at cost
Accumulated depreciation
Motor vehicles – at cost
Accumulated depreciation
Land – at cost
Buildings – at cost
Accumulated amortisation
Total property, plant, and equipment
6.2.1 Movements in Carrying Amounts
Plant and
Equipment
$’000
Motor
vehicles
$’000
Carrying amount at 1 January 2022
Additions
Reclassifications to right-of-use assets
Depreciation for the year
Exchange differences
424
1,103
-
(288)
81
Carrying amount at 31 December 2022 -
1,320
386
-
-
(100)
(5)
281
Carrying amount at 1 January 2023
-
-
Additions
Disposals / write-offs
Depreciation for the year
Exchange differences
1,320
1,242
-
(143)
190
Carrying amount at 31 December 2023 -
2,609
-
-
P a g e | 41
-
-
-
281
-
-
(100)
(4)
177
-
Land
$’000
1,100
-
(1,100)
-
-
-
-
-
-
-
-
-
-
-
-
3,555
2,226
-
(386)
(167)
5,228
-
2022
$’000
2,929
(1,609)
1,320
425
(144)
281
-
7,316
(3,761)
3,555
5,156
Total
$’000
5,989
1,151
(1,100)
(888)
4
5,156
5,156
3,468
-
(629)
19
8,014
-
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 6
Non-financial assets and financial liabilities (cont.)
6.2
Property, plant, and equipment (cont.)
6.2.2 Accounting policy
a. Recognition and measurement
Items of plant and equipment are measured on the cost basis and carried at cost less accumulated depreciation (see
below) and impairment losses (see accounting policy 6.5.1 Impairment of non-financial assets).
Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets
includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to a working
condition for its intended use, and the costs of dismantling and removing the items and restoring the site on which they
are located, and an appropriate proportion of production overheads. Cost includes the cost of replacing parts that are
eligible for capitalisation when the cost of replacing the parts is incurred. Similarly, when each major inspection is
performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement only if it is eligible
for capitalisation.
Where considered material, the carrying amount of property, plant, and equipment is reviewed annually by Directors to
ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis
of the expected net cash flows that will be received from the asset’s employment and subsequent disposal. The expected
net cash flows have not been discounted to their present values in determining recoverable amounts.
Where parts of an item of property, plant, and equipment have different useful lives, they are accounted for as separate
items of plant and equipment.
b. Subsequent costs
The cost of replacing part of an item of plant and equipment is recognised in the carrying amount of the item if it is
probable that the future economic benefits embodied within the part will flow to the Group and its cost can be measured
reliably. Any costs of the day-to-day servicing of plant and equipment are recognised in the income statement as an
expense as incurred.
c. Depreciation
Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each of property,
plant and equipment. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is
reasonably certain that the Group will obtain ownership by the end of the lease term. Land is not depreciated. Assets
will be depreciated once the asset is in the condition necessary for it to be capable of operating in the manner intended
by management.
The estimated useful lives for the current and comparative periods are as follows:
Class
Plant and equipment:
Plant and equipment
Office furniture and fittings
Moulds
Motor vehicles
Buildings
Buildings
Leasehold improvements
2023
Years
2022
Years
3 – 10
3 – 10
5
5
4
20
5
5
5
4
20
5
Depreciation methods, useful lives and residual values are reviewed at each reporting date. The carrying amount of plant
and equipment is reviewed to ensure it is not in excess of the recoverable amount from these assets. The recoverable
amount is assessed on the basis of the expected net cash flows which will be received from the assets’ employment and
subsequent disposal. The expected net cash flows have not been discounted to their present values in determining
recoverable amounts.
d. Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits
are expected from its use or disposal. The gain or loss on disposal of an item of property, plant and equipment is
determined by comparing the proceeds from disposal with the carrying amount of the property, plant and equipment
and is recognised net within other income in profit or loss. Where revalued assets are sold, any related amount included
in the revaluation reserve is transferred to retained earnings.
P a g e | 42
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 6
Non-financial assets and financial liabilities (cont.)
ANNUAL REPORT
31 December 2023
6.3
Leases
6.3.1 Right-of-use assets
Land
Buildings
6.3.2 Lease liabilities
Current
Non-current
6.3.3 Additions to the right-of-use assets
Land (including reclassifications)
Buildings
6.3.4 Amounts recognised in the statement of profit or loss:
Depreciation charge of right-of-use assets:
Land
Buildings
Interest expense (included in finance cost)
6.3.5 Amounts recognised in comprehensive income:
Exchange differences:
Land
Buildings
6.3.6 Total cash outflow for leases
6.3.7 Operating leases
2023
$’000
3,552
1,142
4,694
257
923
1,180
2,899
989
3,888
54
182
236
42
89
18
107
295
2022
$’000
756
246
1,002
110
165
275
1,100
-
1,100
324
98
422
17
21
16
37
156
The Group leases out partial of its Nanjing manufacturing facilities and these leases have been classified as operating leases
because they do not transfer substantially the risks and rewards incidental to the ownership of the assets.
Rental income recognised by the Group during the year ended 31 December 2023 was $1,035K (2022: $512K).
6.3.8 Accounting policy
a. The Group as a Lessee
The Group leases warehouse and office facilities in the UK, France, the Netherlands, and Italy for its electric two-wheel
vehicle distribution and after sales operations. The leases typically run for a period between 5 and 6 years, with an option
to renew the lease after that date. Lease payments are adjusted based on changes in local price indices. The Group is
restricted from entering any sub-lease arrangements.
Except for short-term leases and leases of low-value underlying assets, each lease is reflected in the consolidated
statement of financial position as a right-of-use assets and lease liabilities. The Group classifies its right-of-use assets in
a consistent manner to its property, plant and equipment.
P a g e | 43
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 6
Non-financial assets and financial liabilities (cont.)
6.3
Leases (cont.)
i. Recognition and measurement
Leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset is
available for use by the Group. The Group has elected not to recognise right-of-use assets and lease liabilities for
short-term leases that have a lease term of 12 months or less and do not contain a purchase option, and leases of
low value assets. The Group recognises the lease payments associated with these leases as an expense on a straight-
line basis over the lease term.
A. Right-of-use Asset
The Group recognises a right-of-use asset at the commencement date of the lease. The right-of-use asset is
initially measured at cost. The cost of right-of-use assets includes the amount of lease liabilities recognised,
adjusted for any lease payments made at or before the commencement date, plus initial direct costs incurred
and an estimate of costs to dismantle, remove or restore the leased asset, less any lease incentives received.
Right-of-use assets are measured at cost comprising the following:
the amount of the initial measurement of lease liability
any lease payments made at or before the commencement date less any lease incentives received
any initial direct costs, and
restoration costs.
Subsequent to initial measurement, the right-of-use asset is depreciated on a straight-line basis over the shorter
of the lease term and the estimated useful life as follows:
Land
Buildings
45 – 50 years
3 – 6.25 years
Where a lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the
Group anticipates to exercise a purchase option, the specific asset is depreciated over the useful life of the
underlying asset.
Right-of-use assets are subject to impairment and are adjusted for any remeasurement of lease liabilities.
B. Lease liabilities
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
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;
lease payments under extension options, where the lessee is reasonably certain to exercise the options; and
payments of penalties for terminating the lease, where the lease term reflects the exercise of an option to
terminate the lease.
The variable lease payments that do not depend on an index or a rate are recognised as expense in the period
on which the event or condition that triggers the payments occurs. The present value of lease payments is
discounted using the interest rate implicit in the lease or, if the rate cannot be readily determined, the Group's
incremental borrowing rate.
The lease liability is measured at amortised cost using the effective interest method. After the commencement
date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease
payments made.
The amount of lease liability is remeasured when there is a change in future lease payments arising from a
change in an index or rate, if there is a change in the Group's estimate of the amount expected to be payable
under a residual value guarantee, or if the Group changes its assessment of whether it will exercise a purchase,
extension, or termination option.
P a g e | 44
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 6
Non-financial assets and financial liabilities (cont.)
6.3
Leases (cont.)
ANNUAL REPORT
31 December 2023
When the lease liability is remeasured, a corresponding adjustment is made to the carrying amount of the right-
of-use asset, or is recognised in profit or loss if the carrying amount of the right-of-use asset has been reduced
to zero.
ii. Extension and termination options
Extension options are included in the property leases of the Group.
b. The Group as a Lessor
Upon entering into each contract as a lessor, the Group assesses if the lease is a finance or operating lease.
A contract is classified as a finance lease when the terms of the lease transfer substantially all the risks and rewards of
ownership to the lessee. All other leases not within this definition are classified as operating leases.
Rental income received from operating leases is recognised on a straight-line basis over the term of the specific lease.
Rental income due under finance leases are recognised as receivables at the amount of the Group’s net investment in
the leases.
Initial direct costs incurred in entering into an operating lease (for example, legal cost, costs to set up equipment) are
included in the carrying amount of the leased asset and recognised as an expense on a straight-line basis over the lease
term.
When a contract is determined to include lease and non-lease components, the Group applies AASB 15 to allocate the
consideration under the contract to each component.
6.4
Intangible assets
Note
Goodwill
Impairment charge
Licences, trademarks, patents, and production rights
Accumulated amortisation
Accumulated impairment
Development costs
Accumulated amortisation
Accumulated impairment
2023
$’000
3,971
(3,971)
-
4,803
(797)
(1,219)
2,787
4,836
(566)
(4,270)
-
2,787
Total intangibles
6.4.1 Movements in Carrying Amounts
Carrying amount at 1 January 2022
Amortisation expense
Carrying amount at 31 December 2022
Carrying amount at 1 January 2023
Additions
Amortisation expense
Carrying amount at 31 December 2023
P a g e | 45
Licences,
trademarks, and
production rights
$’000
Goodwill
$’000
Development
costs
$’000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,787
-
2,787
-
-
-
-
-
-
-
-
-
-
2022
$’000
3,971
(3,971)
-
2,016
(797)
(1,219)
-
4,836
(566)
(4,270)
-
-
Total
$’000
-
-
-
-
-
2,787
-
2,787
-
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 6
Non-financial assets and financial liabilities (cont.)
6.4
Intangible assets (cont.)
6.4.2 Accounting policy
a. Intangible assets acquired separately
Intangible assets acquired separately are recorded at cost less accumulated amortisation and impairment. Amortisation is
charged on a straight-line basis over the estimated useful lives. The estimated useful life and amortisation method is
reviewed at the end of each year, with any changes in these estimates being accounted for on a prospective basis.
i. Trademarks, licenses and production rights
Trademarks, licenses and production rights are recognised at cost of acquisition. Licenses and production rights have
an indefinite life and are carried at cost less any accumulated impairment. Trademarks are estimated to have a useful
life of five years and amortised over a five-year period. The carrying values of trademark are reviewed for impairment
when events or changes in circumstances indicate the carrying value may not be recoverable.
ii. Patents
Patents acquired in a business combination and recognised separately from goodwill are initially recognised at fair value
at acquisition date (which is deemed cost). Subsequent to initial recognition, patents acquired in a business combination
are reported at cost less accumulated amortisation and impairment, on the same basis as patents acquired separately.
iii. Customer contracts
Customer contracts acquired in a business combination and recognised separately from goodwill are initially recognised
at their fair value at the acquisition date (which is regarded as their costs). Subsequent to initial recognition, customer
contracts acquired in a business combination are reported at cost less accumulated amortisation and accumulated
impairment losses, on the same basis as patents that are acquired separately.
b. Intangible assets acquired in a business combination
Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value
at the date of the acquisition. Intangible assets acquired separately are initially recognised at cost. Indefinite life intangible
assets are not amortised and are subsequently measured at cost less any impairment. Finite life intangible assets are
subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit or loss arising
from derecognition of intangible assets are measured as the difference between net disposal proceeds and the carrying
amount of the intangible asset. The method and useful lives of finite life intangible assets are reviewed annually. Changes
in the expected pattern of us or useful life are accounted for prospectively by changing the amortisation method or period.
c. Development Costs
Development costs are capitalised only when technical feasibility studies identify that the project is expected to deliver
future economic benefits and these benefits can be measured reliably. Capitalised development costs have a finite useful
life and are amortised on a systematic basis based on the future economic benefits over the useful life of the project.
6.5 Other Significant Accounting Policies related to Non-Financial Assets and Liabilities
6.5.1
Impairment of non-financial assets
The carrying amounts of the Group's non-financial assets, other than deferred tax assets (see note 4.9) are reviewed at each
reporting date to determine whether there is any indication of impairment. If an indication exists, then the asset's recoverable
amount is estimated. Goodwill and intangible assets that have indefinite useful lives are not subject to amortisation and tested
annually for impairment or more frequently if events or changes in circumstances indicate that they might be impaired. Other
assets are reviewed for impairment whenever events or changes in circumstances indicate carrying amounts may not be
recoverable
An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit (CGU) exceeds its recoverable
amount. A CGU is the smallest identifiable asset group that generates cash flows that largely are independent from other assets
and groups. Impairment losses are recognised in the income statement, unless the asset has previously been revalued, in which
case the impairment loss is recognised as a reversal to the extent of that previous revaluation with any excess recognised
through the income statement. Impairment losses recognised in respect of CGUs are allocated first to reduce the carrying
amount of any goodwill allocated to the units and then to reduce the carrying amount of the other assets in the unit on a pro
rata basis.
The recoverable amount of an asset or CGU is the greater of its fair value less costs to sell and value in use. In assessing value in
use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate largely
independent cash inflows, the recoverable amount is determined for the CGU to which the asset belongs.
Impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased
or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable
amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount
that would have been determined, net of depreciation and amortisation, if no impairment loss had been recognised.
P a g e | 46
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
ANNUAL REPORT
31 December 2023
Note 7
Equity
7.1
Issued capital
Note
2023
No.
2022
No.
2023
$’000
Fully paid ordinary shares
395,487,192
283,524,201
109,841
7.1.1 Ordinary shares
2023
No.
2022
No.
At the beginning of the year
283,524,201
279,360,084
-
-
-
-
1,720,000
1,500,000
94,117
850,000
Shares issued during the year:
Issue at nil consideration
Issue at $0.353 per share
Issue at $0.430 per share
Issue at nil consideration
Issue at $0.337 per share
7.1.1a
7.1.1b
7.1.1c
7.1.1d
7.1.1e
4,037,117
Employee incentive shares
7.1.1f
1,950,000
Issue at $0.330 per share
7.1.1g
288,139
Issue at $0.350 per share
Issue at $0.275 per share
Issue at $0.275 per share
7.1.1h
7.1.1i
7.1.1j
Vesting of employee shares
7.1.1k
Issue at $0.150 per share
Issue at $0.150 per share
Issue at $0.150 per share
7.1.1l
7.1.1l
7.1.1l
Transaction costs relating to share
issues
42,857
107,142
290,834
-
37,222,333
35,337,070
32,687,499
-
2023
$’000
91,908
-
-
-
-
1,360
179
95
15
29
80
420
5,583
5,301
4,903
(32)
-
-
-
-
-
-
-
-
-
-
2022
$’000
91,908
2022
$’000
90,559
168
529
40
306
-
-
-
-
-
-
306
-
-
-
-
At reporting date
395,487,192
283,524,201
109,841
91,908
a. 04.04.2022 Issued to employees of the Company, at nil consideration, in recognition of their efforts and contribution to the
Company, recognised over a three-year vesting period.
b. 11.04.2022 Issued to investors pursuant to strategic partnership and investment agreements signed.
c. 13.05.2022 Shares issued to a director in lieu of unpaid Director fees.
d. 19.12.2022 Shares to Directors as a result of vesting of 850,000 service rights.
e. 03.01.2023 Issue of shares upon vesting of performance rights (refer note 7.2.1).
f. 22.02.2023 Issued at nil consideration to employees of the Company in recognition of their efforts and contribution to the
Company (refer note 21.2.1a).
g. 22.02.2023 Issued 288,139 shares at $0.33 per share to a key management person pursuant to their employment contract
(refer note 21.2.1a).
h. 23.03.2023
Issued 42,857 shares at $0.35 per share to a former director who has ceased to be a related party, in lieu of
historic Director fees (refer note 21.2.1a).
i. 01.06.2023
Issued 107,142 shares at $0.275 per share, in lieu of Director’s fees (refer note 21.2.1a).
j. 01.06.2023
Issued 290,834 shares at $0.275 per share, as a portion of Managing Director’s and Finance Director’s
remuneration (refer note 21.2.1a).
k. Vesting of shares issued in 2019/2020, 2020/2021, and 2021/2022 to employees, valued at $28,698, $168,133, and $223,600
respectively.
l. 20.11.2023 and 06.11.2023
Share rights issue of 105,246,902 at 15 cents per share, raising a total of $15.787 million.
P a g e | 47
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 7
Equity (cont.)
7.2 Options and rights
Note
Options
Performance rights
7.2.1 Options and rights movement
2023
No.
2022
No.
23,100,000
24,100,000
6,768,402
7,932,147
29,868,402
32,032,147
2023
No.
2022
No.
At the beginning of the year
32,032,147
6,757,289
Changes during the year:
2020 performance rights
2021 performance rights
2022 performance rights
21.2.2
21.2.2
21.2.2
Options exp. 11.04.26 at $0.45 7.2.1a
Options exp. 11.04.27 at $0.55 7.2.1a
Options exp. 11.04.27 at $0.65 7.2.1a
2022 options to Jane Morgan 7.2.1b
Vest of service rights 2020
-
-
-
-
-
-
-
-
-
-
2,024,858
6,600,000
7,700,000
8,800,000
1,000,000
(850,000)
2023
$’000
195
588
783
2023
$’000
1,852
-
121
152
-
-
-
-
-
2023 performance rights
21.2.2
2,873,372
Vest of service rights 2020
21.2.2
(4,037,117)
Unvested options 20.06.25
7.2.1b
(1,000,000)
-
-
-
117
(1,360)
(99)
2022
$’000
99
1,753
1,852
2022
$’000
974
812
121
152
-
-
-
99
(306)
-
-
-
At reporting date
29,868,402
32,032,147
783
1,852
a. 11.04.2022 A total of 23.1 million options issued to Giovanni Castiglioni with exercises prices between $0.45 and $0.65
pursuant to the strategic partnership and investment agreement announced to ASX on 4 April 2022. They were
issued for nil consideration.
Grant
date
Vesting
date
Expiry
date
Exercise Price
$
11.04.2022
11.04.2022
11.04.2026
11.04.2022
11.04.2022
11.04.2027
11.04.2022
11.04.2022
11.04.2027
0.45
0.55
0.65
Options
No.
6,600,000
7,700,000
8,800,000
b. 21.04.2022
Issued 1 million options to an advisor for investor relation services provided. These options did not vest during
the current year, and were reversed.
7.3
Reserves
7.3.1 Summary of equity reserves:
Share-based payment reserve
Foreign currency translation reserve
7.3.2 Nature and purpose of reserves
a. Share-based payment reserve
2023
$’000
783
(2,686)
(1,903)
2022
$’000
1,852
475
2,327
The share-based payments reserve is used to recognise the value of options and performance shares or rights issued
but not exercised and to recognise the fair value of service and performance rights issued but not yet vested.
b. Foreign Currency Translation Reserve
The foreign currency translation reserve is used to recognise exchange differences arising from the translation of the
financial statements of foreign operations.
P a g e | 48
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
ANNUAL REPORT
31 December 2023
SECTION B. RISK
This section of the notes discusses the Group’s exposure to various risks and shows how these could affect the Group’s financial
position and performance.
Note 8
Financial risk management
8.1
Financial Risk Management Policies
This note presents information about the Group’s exposure to each of the above risks, its objectives, policies and
procedures for measuring and managing risk, and the management of capital.
The Group’s principal financial instruments comprise bank and other loans, cash and short-term deposits. The main
purpose of these financial instruments is to raise finance for the Group’s operations.
The Group has various other financial instruments such as trade debtors and trade creditors, which arise directly from its
operations.
It is, and has been throughout the period under review, the Group’s policy that no trading in derivative instruments shall
be undertaken.
A summary of the Group’s financial assets and liabilities is shown below:
Floating
Interest
Rate
$’000
Fixed
Interest
Rate
$’000
Non-
Interest
Bearing
$’000
2023
Total
$’000
Floating
Interest
Rate
$’000
Fixed
Interest
Rate
$’000
Non-
Interest
Bearing
$’000
2022
Total
$’000
Financial Assets
Cash and cash equivalents
42,524
-
-
Trade and other receivables
-
2,277
9,220
42,524
11,497
28,026
-
Total Financial Assets
42,524
2,277
9,220
54,021
28,026
Financial Liabilities at amortised cost
Trade and other payables
Borrowings
Leases
Total Financial Liabilities
-
-
-
-
-
11,520
11,520
4,120
1,180
-
-
4,120
1,180
5,300
11,520
16,820
-
-
-
-
-
-
-
-
-
275
275
-
17,470
28,026
17,470
17,470
45,496
21,701
21,701
-
-
-
275
21,701
21,976
Net Financial Assets / (Liabilities)
42,524
(3,023)
(2,300)
37,201
28,026
(275)
(4,231)
23,520
8.2
Specific Financial Risk Exposures and Management
The main risk the Group is exposed to through its financial instruments are credit risk, liquidity risk and market risk
consisting of interest rate, foreign currency risk and equity price risk. The Group’s overall risk management program
focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial
performance of the Group.
The Board has overall responsibility for the establishment and oversight of the risk management framework. The Board
adopts practices designed to identify significant areas of business risk and to effectively manage those risks in accordance
with the Group’s risk profile. This includes assessing, monitoring and managing risks for the Group and setting appropriate
risk limits and controls. The Group is not of a size nor is its affairs of such complexity to justify the establishment of a
formal system for risk management and associated controls. Risk management is carried out by the full Board as the
Group believes that it is crucial for all board members to be involved in this process. The Chairman, with the assistance
of senior management as required, has responsibility for identifying, assessing, treating and monitoring risks and
reporting to the Board on risk management.
P a g e | 49
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 8
Financial risk management (cont.)
8.2.1 Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of contract
obligations that could lead to a financial loss to the Group.
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Group. The Group continuously monitors credit risks arising from its trade receivables which are principally with
significant and reputable companies. It is the Group’s policy that credit verification procedures, including assessment of
credit ratings, financial position, past experience and industry reputation, are performed on new customers that request
credit terms. Risk limits are set for each customer and regularly monitored. Receivable balances are monitored on an
ongoing basis with the result that the Group’s exposure to bad debts is not significant.
The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and
other receivables.
Credit risk exposures
The maximum exposure to credit risk, arising from cash and cash equivalents and trade receivables, is limited to the
carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial
position and notes to the financial statements.
Credit risk related to balances with banks and other financial institutions is managed by the Group in accordance with
approved Board policy. Such policy requires that surplus funds are only invested with financial institutions residing in
Australia, wherever possible. There are no significant concentrations of credit risk, whether through exposure to
individual customers, specific industry sectors and/or regions.
Impairment losses
The ageing of the Group’s current trade and other receivables at reporting date was as follows:
Trade receivables
Not past due to 30 days
Not past due 31 to 60 days
Past due 61 to 90 days
Past due over 90 days
Other receivables
Not past due
Total - -
Gross
2023
$’000
2,372
685
2,471
3,421
8,949
2,548
11,497
Impaired
2023
$’000
Past due but
not impaired
2023
$’000
Net
2023
$’000
Gross
2022
$’000
Impaired
2022
$’000
Past due but
not impaired
2022
$’000
Net
2022
$’000
-
-
-
-
-
-
-
2,372
685
2,471
3,421
8,949
-
685
2,471
3,421
6,577
4,883
1,552
2,640
12,919
21,994
-
-
-
(4,524)
4,883
1,552
2,640
8,395
-
-
2,640
8,395
(4,524)
17,470
11,035
2,548
-
-
-
-
-
11,497
6,577
21,994
(4,524)
17,470
11,035
2023
As of 31 December 2023, trade and other receivables of $6,577K (31 December 2022: $11,035K) were past due but
not impaired.
2022
Of the $11,035K past due, $4,828K relates to deferred payment arrangement with a B2C customer. The customer has
been making payments on time, in full.
Additionally, $5,515K relates to a short-term advance to Nanjing Vmoto Soco Intelligent Technology Co, Ltd (Vmoto
Soco Manufacturing), which is the Company’s jointly owned Chinese registered manufacturing company. The short-
term advance will only be due for repayments in August 2023 and it has no history of default.
The remaining trade and other receivables relate to a number of independent customers for whom there is no recent
history of default.
P a g e | 50
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 8
Financial risk management (cont.)
8.2.2 Liquidity risk
ANNUAL REPORT
31 December 2023
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its
liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage
to the Group’s reputation.
Ultimate responsibility for liquidity risk management rests with the Board, who have built an appropriate liquidity risk
management framework for the management of the Group’s short, medium and long-term funding and liquidity
management requirements. Liquidity risk arises from the possibility that the Group might encounter difficulty in settling
its debts or otherwise meeting its obligations related to financial liabilities. The Group manages this risk through the
following mechanisms:
preparing forward-looking cash flow analyses in relation to its operational, investing and financing activities;
monitoring undrawn credit facilities;
obtaining funding from a variety of sources;
maintaining a reputable credit profile; and
managing credit risk related to financial assets.
The Group has no access to credit standby facilities or arrangements for further funding or borrowings in place. The non-
interest bearing financial liabilities the Group had at the end of the reporting period were trade and other payables
incurred in the normal course of the business. These were and were due within the normal 30-60 days terms of creditor
payments. Interest-bearing liabilities of the Group comprised borrowings (note 5.5) and leases (note 6.3).
Contractual Maturities
The table below analyses the Group’s financial liabilities and assets into relevant maturity groupings based on the
remaining period at the end of the reporting period to the contractual maturity date. The amounts disclosed in the
table are the contractual undiscounted cash flows:
Greater Than 1 Year
Within 1 Year
2023
$’000
2022
$’000
Financial liabilities due for payment
Trade and other payables
11,520
21,701
Borrowings
Leases
4,120
257
-
110
Total contractual outflows
15,897
21,811
Financial assets
Cash and cash equivalents
Trade and other receivables
42,524
9,220
28,026
17,470
Total anticipated inflows
51,744
45,496
Net outflow on financial instruments
35,847
23,685
2023
$’000
-
-
923
923
-
2,277
2,277
1,354
2022
$’000
-
-
165
165
-
-
-
Total
2023
$’000
2022
$’000
11,520
21,701
4,120
1,180
-
275
16,820
21,976
42,524
11,497
28,026
17,470
54,021
45,496
(165)
37,201
23,520
It is not expected that the cash flows included in the maturity analysis could occur significantly earlier or at
significantly different amounts.
8.2.3 Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will
affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management
is to manage and control market risk exposures within acceptable parameters, while optimising the return.
The Group’s activities minimally expose it to the financial risks of changes in foreign currency exchange rates, commodity
prices and exchange rates. The Group does not enter into derivative financial instruments including foreign exchange
forward contracts to hedge against financial risk. There has been no change to the Group’s exposure to market risks or
the manner in which it manages and measures the risk from the previous period.
P a g e | 51
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 8
Financial risk management (cont.)
a. Interest rate risk
The Group’s exposure to market risk for changes in interest rates relates primarily to the Group’s short-term debt
obligations.
Cash includes funds held in term deposits and cheque accounts during the year, which earned interest at rates ranging
between 0% and 3.3%, depending on account balances. The Group currently does not have credit facilities.
All other financial assets and liabilities are non-interest bearing.
b. Foreign exchange risk
The Group is exposed to foreign currency on sales, purchases and borrowings that are denominated in a currency
other than Australian Dollars. The currencies giving rise to this risk is primarily US Dollar (USD), Chinese Renminbi
(RMB), and European Euro (EUR), and minor exposure to the Hong Kong Dollar (HKD) and Singaporean Dollar (SGD).
At balance date, the Group had the following exposures to foreign currency that are not designated as cash flow
hedges:
USD
A$’000
RMB
A$’000
EUR
A$’000
SGD
A$’000
HKD
A$’000
FX exposed
currency
A$’000
AUD
A$’000
Total
A$’000
2023
Financial assets
Cash and cash equivalents
Trade and other receivables
21,263
672
14,650
10,652
Total financial assets
21,935
25,302
Financial liabilities
Trade and other payables
3,821
Borrowings
Leases
-
-
Total financial liabilities
3,821
2,496
4,120
-
6,616
1,849
3,101
4,950
6,555
-
1,180
7,735
2
11
13
-
-
-
-
10
-
37,774
14,436
4,750
(5,216)
42,524
9,220
10
52,210
( 466)
51,744
308
-
-
13,180
4,120
1,180
(1,660)
-
-
11,520
4,120
1,180
308
18,480
(1,660)
16,820
Net foreign currency financial
assets
2022
Financial assets
18,114
18,686
(2,785)
13
(298)
33,730
1,194
34,924
USD
A$’000
RMB
A$’000
EUR
A$’000
SGD
A$’000
HKD
A$’000
FX exposed
currency
A$’000
AUD
A$’000
Total
A$’000
Cash and cash equivalents
Trade and other receivables
18,891
8,319
4,746
7,576
Total financial assets
27,210
12,322
Financial liabilities
Trade and other payables
Leases
6,976
-
10,221
-
Total financial liabilities
6,976
10,221
1,537
1,570
3,107
4,599
275
4,874
22
-
22
-
-
-
17
-
25,213
17,465
2,813
5
28,026
17,470
17
42,678
2,818
45,496
-
-
-
21,796
275
22,071
(95)
-
(95)
21,701
275
21,976
Net foreign currency financial
assets
c. Price risk
20,234
2,101
(1,767)
22
17
20,607
2,913
23,520
Price risk relates to the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in market prices. The Group does not presently hold material amounts subject to price risk. As such the
Board considers price risk as a low risk to the Group.
P a g e | 52
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 8
Financial risk management (cont.)
8.2.4 Sensitivity Analyses
ANNUAL REPORT
31 December 2023
In managing interest rate and currency risks, the Company endeavours to reduce the impact of short-term fluctuations
on the Company’s earnings. Over the longer term, however, permanent changes in foreign exchange and interest rates
will have an impact on consolidated earnings, although the extent of that impact will depend on the level of cash
resources held by the Group.
a. Interest rates
A general change of one percentage point in interest rates would be
expected to have the following impact on earnings.
Year ended 31 December 2023
±50 basis points change in interest rate
Year ended 31 December 2022
±50 basis points change in interest rates
b. Foreign exchange
A general change of 20 percent exchange rates would be expected to have
the following impact on earnings:
i. AUD to USD
Year ended 31 December 2023
±20 per cent change in AUD to USD rate
Year ended 31 December 2022
±20 per cent change in AUD to USD rate
ii. AUD to RMB
Year ended 31 December 2023
±20 per cent change in AUD to RMB rate
Year ended 31 December 2022
±20 per cent change in AUD to RMB rate
iii. AUD to EUR
Year ended 31 December 2023
±20 per cent change in AUD to EUR rate
Year ended 31 December 2022
±20 per cent change in AUD to EUR rate
Profit
$’000
Equity
$’000
± 213
± 213
± 140
± 140
Profit
$’000
Equity
$’000
± 3,623
± 3,623
± 4,047
Profit
$’000
± 4,047
Equity
$’000
± 3,737
± 3,737
± 420
Profit
$’000
± 420
Equity
$’000
± (557)
± (557)
± (353)
± (353)
8.2.5 Net Fair Values
a. Fair value estimation
The fair values of financial assets and financial liabilities are presented in the table in note 8.1 and can be compared to
their carrying values as presented in the statement of financial position. Fair values are those amounts at which an asset
could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length transaction.
Financial instruments whose carrying value is equivalent to fair value due to their nature include:
Cash and cash equivalents;
Trade and other receivables;
Trade and other payables; and
Lease liabilities.
The methods and assumptions used in determining the fair values of financial instruments are disclosed in the
accounting policy notes specific to the asset or liability.
P a g e | 53
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 9
Capital Management
9.1
Capital
The Group manages its capital to ensure its ability to continue as a going concern and to achieve returns to the
shareholders and benefits for other stakeholders through the optimisation of debt and equity balance. The capital
structure of the Group is adjusted to achieve its goals whilst ensuring the lowest cost of the capital.
Capital is defined as the combination of contributed equity, reserves and net debt (borrowings less cash). The capital
structure of the Group can be changed by paying distributions to shareholders, returning capital to shareholders, issuing
new shares or selling assets.
Management monitors capital on the basis of the gearing ratio (debt/total capital). During the year ended 31 December
2023, the Group’s strategy is to utilise lowest cost of the capital from the capital markets and continuously negotiating
lower interest cost with provider of its operating facility to achieve its expansion program.
9.1.1 Gearing ratio
Total borrowings
Total equity
Total capital
Gearing ratio
9.1.2 Working capital
The working capital position of the Group was as follows:
Cash and cash equivalents
Trade and other receivables
Inventories
Other current assets
Trade and other payables
Borrowings
Current tax liabilities
Leases
Working capital position
2023
$’000
5,300
79,497
84,797
2022
$’000
275
58,536
58,811
6.25%
0.47%
Note
5.1
5.2.1
6.1
5.3.1
5.4.1
5.5.1
4.5
6.3.2
2023
$’000
42,524
9,220
16,145
5,047
(11,520)
(4,120)
-
(257)
2022
$’000
28,026
17,470
13,508
9,923
(21,701)
-
(474)
(110)
57,039
46,642
P a g e | 54
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
ANNUAL REPORT
31 December 2023
SECTION C. GROUP STRUCTURE
This section provides information which will help users understand how the Group structure affects the financial position and
performance of the Group as a whole. In particular, there is information about:
(a) changes to the structure that occurred during the year as a result of business combinations and the disposal of a discontinued
operation.
(b) transactions with non-controlling interests, and
(c)
interests in joint operations.
A list of significant subsidiaries is provided in note 11 below.
Note 10 Parent entity disclosures
The Vmoto Ltd is the ultimate Australian parent entity and ultimate parent of the Group.
The Vmoto Ltd did not enter into any trading transactions with any related party during the year.
10.1 Financial Position of Vmoto Ltd
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Share-based payment reserve
Accumulated losses
Total equity
10.2 Financial performance of Vmoto Ltd
Profit or (loss) for the year
Other comprehensive income
Total comprehensive income
10.3 Contractual commitments
2023
$’000
4,369
39,927
44,296
483
-
483
2022
$’000
1,711
26,723
28,434
148
-
148
43,813
28,286
109,841
783
(66,811)
91,908
1,852
(65,474)
43,813
28,286
2023
$’000
(1,337)
-
(1,337)
2022
$’000
(273)
-
(273)
The parent company has no capital commitments at 2023 (2022: $nil). The Group’s commitments are disclosed in note
14 Commitments.
10.4 Contingent liabilities and guarantees
There are no guarantees entered
(2022: none). The Group’s contingencies are disclosed in note 15 Contingent liabilities.
into by Vmoto Ltd
the debts of
for
its subsidiaries as at 2023
P a g e | 55
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 11
Interests in subsidiaries
11.1
Information about principal subsidiaries
The subsidiaries listed below have share capital consisting solely of ordinary shares which are held directly by the Group
and the proportion of ownership interest held equals the voting rights held by the Group. Investments in subsidiaries are
accounted for at cost. Each subsidiaries’ country of incorporation is also its principal place of business, with the exception
of Vmoto International Ltd and Vmoto International Pte Ltd are managed from China and export globally:
Country of
Incorporation
2023
%
2022
%
Vmoto Australia Pty Ltd
Australia
Vmoto International Limited formerly Vmoto Soco International Limited
Hong Kong
Nanjing Vmoto Co, Ltd
Nanjing Vmoto Manufacturing Co, Ltd
Nanjing Vmoto Intelligent Technology Co, Ltd
Hainan Vmoto Intelligent Technology Investments Co, Ltd
China
China
China
China
Vmoto International Pte Ltd formerly Vmoto Soco International Pte Ltd
Singapore
Vmoto Europe HQ srl (incorporated November 2023)
Vmoto Europe B.V.
Vmoto Soco Italy srl
Italy
Netherlands
Italy
Vmoto Soco UK Ltd (incorporated February 2023)
United Kingdom
Vmoto Soco Frances s.a.s. (incorporated April 2023)
France
100
100
100
100
100
100
100
100
100
50
100
100
100
100
100
100
100
100
100
-
100
50
-
-
Note 12
Investment accounted for using the equity method
12.1 Non-Current
Vmoto Soco Manufacturing
12.3.3
Other investments accounted for using the equity method
2023
$’000
5,079
530
5,609
2022
$’000
5,685
216
5,901
12.2
Information about associates
The Group has a 50% equity interest in Nanjing Vmoto Soco Intelligent Technology Co, Ltd (Vmoto Soco Manufacturing),
which is a jointly owned manufacturing company with Super Soco Intelligent Technology (Shanghai) Co, Ltd. The Group’s
interest in Vmoto Soco Manufacturing is accounted for using equity method in the consolidated financial statements as
the Group does not control or have joint control over Vmoto Soco Manufacturing.
Vmoto Soco Manufacturing
Country of
Incorporation
China
Percentage Owned
2023
50
2022
50
P a g e | 56
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
ANNUAL REPORT
31 December 2023
Note 12
Investment accounted for using the equity method (cont.)
12.3 Summarised financial information
Summarised financial information of the Group’s share in Vmoto Soco Manufacturing is as follows:
12.3.1 Summarised financial position
Current assets
Current liabilities
Current net assets
Non-current assets
Non-current liabilities
Non-current net assets
Net assets
12.3.2 Summarised financial performance
Revenue and other income
Cost of sales
Administrative expenses
Income tax benefit / (expense)
Total comprehensive loss
Group's share of associate's loss after tax
Group's share of associate's other comprehensive income
12.3.3 Reconciliation to carrying amounts:
Opening net assets at fair value
Share of loss for year
Movements due to foreign exchange
Closing net assets (carrying amount of investment)
2023
$’000
18,161
(15,278)
2,883
7,276
-
7,276
2022
$’000
33,885
(29,959)
3,926
7,444
-
7,444
10,159
11,370
2023
$’000
33,672
(30,148)
(4,435)
-
(911)
(456)
-
2022
$’000
5,685
(456)
(150)
5,079
2022
$’000
66,182
(63,125)
(5,703)
-
(2,646)
(1,323)
-
2022
$’000
7,133
(1,323)
(125)
5,685
12.3.2
Note 13 Significant Accounting Policies related to Group Structure
13.1 Basis of consolidation
As at reporting date, the assets and liabilities of all controlled entities have been incorporated into the consolidated financial
statements as well as their results for the year then ended. Where controlled entities have entered (left) the Consolidated
Group during the year, their operating results have been included (excluded) from the date control was obtained (ceased).
13.1.1 Business combinations
Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business
combination is measured at fair value, which is calculated as the sum of the acquisition‑date fair values of assets transferred
by the Group, liabilities incurred by the Group to the former owners of the acquiree and the equity interest issued by the
Group in exchange for control of the acquiree. Acquisition‑related costs are recognised in profit or loss as incurred. At the
acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value at the
acquisition date, except that:
deferred tax assets or liabilities and assets or liabilities related to employee benefit arrangements are recognised and
measured in accordance with AASB 112 Income Taxes and AASB 119 Employee Benefits respectively;
liabilities or equity instruments related to share‑based payment arrangements of the acquiree or share‑based payment
arrangements of the Group entered into to replace share‑based payment arrangements of the acquiree are measured
in accordance with AASB 2 Share‑Based Payments at the acquisition date; and
assets (or disposal groups) that are classified as held for sale in accordance with AASB 5 Non‑current Assets Held for Sale
and Discontinued Operations are measured in accordance with that Standard.
P a g e | 57
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 13 Significant Accounting Policies related to Group Structure
a. Goodwill
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non‑controlling
interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over
the net of the acquisition‑date amounts of the identifiable assets acquired and the liabilities assumed. If, after
reassessment, the net of the acquisition‑date amounts of the identifiable assets acquired and liabilities assumed exceeds
the sum of the consideration transferred, the amount of any non‑controlling interests in the acquiree and the fair value
of the acquirer’s previously held interest in the acquiree (if any), the excess is recognised immediately in profit or loss as
a bargain purchase gain.
When the consideration transferred by the Group in a business combination includes contingent consideration
arrangement, the contingent consideration is measured at its acquisition‑date fair value and included as part of the
consideration transferred in a business combination. Changes in fair value of the contingent consideration that qualify
as measurement period adjustments are adjusted retrospectively, with corresponding adjustments against goodwill.
Measurement period adjustments are adjustments that arise from additional information obtained during the
measurement period (which cannot exceed one year from the acquisition date) about facts and circumstances that
existed at the acquisition date.
The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as
measurement period adjustments depends on how the contingent consideration is classified. Contingent consideration
that is classified as equity is not remeasured at subsequent reporting dates and its subsequent settlement is accounted
for within equity. Other contingent consideration is remeasured to fair value at subsequent reporting dates with changes
in fair value recognised in profit or loss.
When a business combination is achieved in stages, the Group’s previously held interests in the acquired entity are
remeasured to its acquisition‑date fair value and the resulting gain or loss, if any, is recognised in profit or loss. Amounts
arising from interests in the acquiree prior to the acquisition date that have previously been recognised in OCI are
reclassified to profit or loss, where such treatment would be appropriate if that interest were disposed of.
If the initial accounting for a business combination is incomplete by the end of the reporting period in which the
combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete. Those
provisional amounts are adjusted during the measurement period, or additional assets or liabilities are recognised, to
reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known,
would have affected the amounts recognised as of that date.
b. Intangible assets acquired in a business combination
Intangible assets acquired in a business combination and recognised separately from goodwill are recognised initially at
their fair value at the acquisition date (which is regarded as their cost).
Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost less
accumulated amortisation and impairment losses, on the same basis as intangible assets that are acquired separately.
c. Contingent liabilities acquired in a business combination
Contingent liabilities acquired in a business combination are initially measured at fair value at the acquisition date. At
the end of subsequent reporting periods, such contingent liabilities are measured at the higher of the amount that would
be recognised in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets and the amount
recognised initially less cumulative amount of income recognised in accordance with the principles of AASB 15 Revenue
from Contracts with Customers.
13.1.2 Subsidiaries
Subsidiaries are entities controlled by the Group. The financial statements of subsidiaries are included in the consolidated
financial statements from the date that control commences until the date that control ceases.
The accounting policies of subsidiaries have been changed when necessary to align them with policies adopted by the Group.
Equity interests in a subsidiary not attributable, directly or indirectly, to the Group are presented as non-controlling interests.
The Group initially recognises non-controlling interests that are present ownership interests in subsidiaries and are entitled
to a proportionate share of the subsidiary’s net assets on liquidation at either fair value or at the non-controlling interests’
proportionate share of the subsidiary’s net assets. Subsequent to initial recognition, non-controlling interests are attributed
their share of profit or loss and each component of other comprehensive income. Non-controlling interests are shown
separately within the equity section of the statement of financial position and statement of comprehensive income.
The grant by the Company of options over its equity instruments to the employees of subsidiary undertakings in the Group
is treated as a capital contribution to that subsidiary undertaking. The fair value of employee services received, measured
by reference to the grant date fair value, is recognised over the vesting period as an increase to investment in subsidiary
undertakings, with a corresponding credit to equity.
P a g e | 58
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
ANNUAL REPORT
31 December 2023
Note 13 Significant Accounting Policies related to Group Structure
Losses applicable to the non-controlling interests in a subsidiary are allocated to the non-controlling interests even if doing
so causes the non-controlling interests to have a deficit balance.
A list of controlled entities is contained in note 11 Interests in subsidiaries of the financial statements.
13.1.3 Loss of control
Upon the loss of control, the Group derecognises the assets and liabilities of the subsidiary, any non-controlling interests
and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised
in profit or loss. If the Group retains any interest in the previous subsidiary, then such interests are measured at fair value at
the date control is lost. Subsequently it is accounted for as an equity-accounted investee or as an available-for-sale financial
asset depending on the level of influence retained.
13.1.4 Transactions eliminated on consolidation
All intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions,
are eliminated in preparing the consolidated financial statements.
13.1.5 Associates
Associates are all entities over which the group has significant influence but not control or joint control. This is generally the
case where the group holds between 20% and 50% of the voting rights. Investments in associates are accounted for using
the equity method of accounting, after initially being recognised at cost.
a. Joint arrangements
Under AASB 11 Joint Arrangements investments in joint arrangements are classified as either joint operations or joint
ventures. The classification depends on the contractual rights and obligations of each investor, rather than the legal
structure of the joint arrangement. A joint venture is an arrangement that the Group controls jointly with one or more
other investors, and over which the Group has rights to a share of the arrangement’s net assets rather than direct rights
to underlying assets and obligations for underlying liabilities. A joint arrangement in which the Group has direct rights to
underlying assets and obligations for underlying liabilities is classified as a joint operation.
b. Joint operations
For joint operations, Vmoto recognises its direct right to the assets, liabilities, revenues and expenses of joint operations
and its share of any jointly held or incurred assets, liabilities, revenues and expenses.
c. Joint ventures
Interests in joint ventures are accounted for using the equity method, after initially being recognised at cost in the
consolidated statement of financial position.
13.1.6 Equity method
Under the equity method of accounting, the investments are initially recognised at cost and adjusted thereafter to recognise
the Group’s share of the post-acquisition profits or losses of the investee in profit or loss, and the group’s share of movements
in other comprehensive income of the investee in other comprehensive income. Dividends received or receivable from
associates and joint ventures are recognised as a reduction in the carrying amount of the investment.
Where the Group’s share of losses in an equity-accounted investment equals or exceeds its interest in the entity, including
any other unsecured long-term receivables, the Group does not recognise further losses, unless it has incurred obligations
or made payments on behalf of the other entity.
Unrealised gains on transactions between the Group and its associates and joint ventures are eliminated to the extent of the
Group’s interest in these entities. Unrealised losses are also eliminated unless the transaction provides evidence of an
impairment of the asset transferred. Accounting policies of equity-accounted investees have been changed where necessary
to ensure consistency with the policies adopted by the Group.
The carrying value of equity-accounted investments is tested for impairment in accordance with the policy described in 6.5.1.
P a g e | 59
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
SECTION D. UNRECOGNISED ITEMS
This section of the notes provides information about items that are not recognised in the financial statements as they do not (yet)
satisfy the recognition criteria. In addition to the items and transactions disclosed below, there are also unrecognised tax amounts.
Note 14 Commitments
14.1 Capital commitments payable:
Within one year
After one year but not more than five years
After five years
Total expenditure requirements
2023
$’000
10,234
702
-
10,936
2022
$’000
-
-
-
-
As 31 December 2023, the Group is currently building new manufacturing facilities is committed for A$10.94 million.
The commitments of Vmoto Limited above are the same as those for the Group.
Note 15 Contingent liabilities
There are no contingent liabilities as at 31 December 2023 (31 December 2022: Nil).
Note 16 Events subsequent to reporting date
16.1 Acquisition of remaining 50% of Vmoto Soco Italy srl
On 14 March 2024, the Company announced that it had entered into an agreement with Giovanni Castiglioni (Castiglioni)
and Graziano Milone (Milone), to acquire the remaining 50% interest in the issued capital of Vmoto Soco Italy srl (VSI), taking
Vmoto's interest up to 100%. Completion is expected on or about 15 April 2024.
The key strategic objectives and rationale for the acquisition of remaining interest in VSI are:
Maximising the value of the Group’s Italian operations by facilitating increased investment into financial and inventory
support to the Group’s Italian dealers to meet increasing local demands;
Streamlining the supply and distribution processes to increase efficiency in delivering the products to a growing dealer
and sales network;
Cost synergies and savings through reduction of logistics costs, inventory holding costs, parts sourcing, and reduction in
other operating costs; and
Release Messrs Milone and Castiglioni's from VSI operations to enable them focus on creating strategic business
development and opportunities, and to increase value for Group.
The key terms of the acquisition agreement are as follows:
Vmoto to acquire Messrs Milone and Castiglioni's 25% interest (each) by issuing 2,777,778 VMT shares equivalent to EUR
250,000 (A$416,667) to each shareholder or their nominee;
Upon signing of the agreement, the put and call option agreement previously signed with Castiglioni and Milone is
formally terminated;
Vmoto to issue 2,777,778 VMT shares equivalent to EUR 250,000 (A$416,667) to each of Castiglioni and Milone for
managing the day-to-day operations of VSI from the commencement of VSI until the date of the agreement (in lieu of
cash salary since the commencement of VSI); and
Upon completion of the acquisition, VSI will appoint an independent Country Manager for Italy to focus on managing the
day-to-day operations of VSI.
16.2
Incorporation of Thai subsidiary
Subsequent to balance date the Group incorporated Vmoto (Thailand) Co, Ltd.
16.3 Lapse of rights
On 15 January 2023, 1,870,172 rights (2021) lapsed due the performance conditions not being satisfied.
16.4
Issue of shares
On 22 March 2024, the Company issued 8,856,610 shares to employees in recognition of their efforts and contribution to
the Company and 861,111 shares issued to consultants in lieu of cash payment for salaries.
There has been no other matter or circumstance that has arisen after balance date that has significantly affected, or may significantly
affect, the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial periods.
P a g e | 60
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
ANNUAL REPORT
31 December 2023
SECTION E. OTHER INFORMATION
This section of the notes includes other information that must be disclosed to comply with the accounting standards and other
pronouncements, but that is not immediately related to individual line items in the financial statements.
Note 17 Key Management Personnel compensation (KMP)
The names and positions of KMP are as follows:
Charles Chen
Ivan Teo
Blair Sergeant
Shannon Coates
Martin Zhou
Other KMP:
Adam Cui
Yaze Liu
Managing Director
Finance Director
Non-executive Director
Non-executive Director
Non-executive Director
Sales Manager
Research & Development Manager
Clive Mann
Country Manager UK
Graziano Milone
Chief Marketing Officer & President of Strategic Business Development
Gaetan Orselli
Country Manager France
Former KMP included in comparative information:
Kaijian Chen
Jeffrey Wu
Maik Spaan
Non-executive Director (Resigned 16 September 2022)
Sales Manager (Resigned 31 March 2022)
Not deemed KMP as at 1 January 2023
Information regarding individual Directors and executives’ compensation and some equity instruments disclosures as required
by the Corporations Regulations 2M.3.03 is provided in the Remuneration report table on page 20.
Short-term employee benefits
Post-employment benefits
Equity-settled share-based payments
Other long-term benefits
Termination benefits
Total
Note 18 Related party transactions
2023
$
2022
$
1,544,545
1,379,225
5,205
850,511
7,244
1,353,804
-
-
-
-
2,400,261
2,740,273
Other than disclosed below and in note 17 Key Management Personnel compensation (KMP) there have been no other related
party transactions.
Receivable/(payable) balance
Related party
Relationship to Vmoto
Nature of transactions
Charles Chen
Managing Director
Unpaid remuneration or fees
Ivan Teo
Finance Director
Unpaid remuneration or fees
Martin Zhou
Non-executive Director Unpaid remuneration or fees
Graziano Milone
Member of KMP
Unpaid remuneration or fees
Note 19 Auditor's remuneration
Remuneration of the auditor for:
Auditing or reviewing the financial reports:
Hall Chadwick WA Audit Pty Ltd
Non-audit services provided by a related practice of the Auditor
P a g e | 61
2023
$
(93,148)
(77,131)
(40,000)
(98,553)
2023
$
116,500
-
116,500
2022
$
(27,500)
(25,625)
(17,500)
-
2022
$
87,000
-
87,000
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 20 Earnings per share (EPS)
Note
20.1 Reconciliation of earnings to profit or loss
Profit for the year
Less: profit / (loss) attributable to non-controlling equity interest
Profit used in the calculation of basic and diluted EPS
2023
$’000
7,258
10
7,248
2023
No.
2022
$’000
10,218
(51)
10,269
2022
No.
20.2 Weighted average number of ordinary shares outstanding
during the year used in calculation of basic EPS
289,345,717
281,821,233
Weighted average number of dilutive equity instruments outstanding
20.5
24,044,444
17,272,465
20.3 Weighted average number of ordinary shares outstanding
during the year used in calculation of diluted EPS
313,390,161
299,093,698
20.4 Earnings per share
Basic EPS (cents per share)
Diluted EPS (cents per share)
2023
₵
2.50
2.31
20.5
20.5
2022
₵
3.64
3.43
20.5 As at 31 December 2023, the Group has 23,100,000 unissued shares under options (31 December 2022: 24,100,000)
and 6,768,402 performance rights on issues (31 December 2022: 7,932,147) and considered to be dilutive.
Note 21 Share-based payments
21.1 Share-based payments:
Recognised in profit and loss:
Note
2023
$
2022
$
Share-based payment expense – Shares
21.2.1a,b
818,710
Share-based payment expense – Options
-
473,542
99,000
Share-based payment expense – Performance rights
21.2.2c
389,514
1,085,175
Gross share-based payments
1,208,224
1,657,717
21.2 Share-based payment arrangements in effect during the period
21.2.1 Shares
a. The Company has issued the following shares during the current reporting period.
Date
Recipient(s)
Purpose of issue
22.02.2023 Employees and
KMP
22.02.2023 Graziano Milone
23.03.2023
(KMP member)
Kaijian Chen
(former director)
1.06.2023 Martin Zhou
1.06.2023
(Director)
Charles Chen
(Director)
Ivan Teo
(Director)
Issued at nil consideration to employees of the
Company in recognition of their efforts and
contribution to the Company. The shares vest
over a three-year period.
Shares issued to a Key Management Person as
part of their employment agreement
Issued to former director who in lieu of historic
Director fees.
Shares issued in lieu of Director’s fees as
approved by Shareholders on 30 May 2023.
Shares issued as a portion of Managing Director
and Finance Director remuneration as approved
by Shareholders on 30 May 2023.
Shares
No.
Issue price
₵
Total expense
$
Total vested
in year
$
1,950,000
33.00
643,500
178,750
288,139
33.00
95,086
95,086
42,857
35.00
15,000
15,000
107,142
27.50
29,464
29,464
150,549
27.50
41,401
41,401
140,285
27.50
38,578
38,578
2,678,972
863,029
398,279
P a g e | 62
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 21 Share-based payments (cont.)
ANNUAL REPORT
31 December 2023
b. The Company recognised the value of the following shares, previously issued, that vested during the reporting period.
Tranche
Recipient(s)
2019/2020 Employees and
KMP
2020/2021 Employees and
KMP
2021/2022 Employees and
KMP
Purpose of issue
Issued at nil consideration to employees of the Company in recognition of their efforts
and contribution to the Company. The shares vest over a three-year period.
Issued at nil consideration to employees of the Company in recognition of their efforts
and contribution to the Company. The shares vest over a three-year period.
Issued at nil consideration to employees of the Company in recognition of their efforts
and contribution to the Company. The shares vest over a three-year period.
Total vested
in year
$
28,698
168,133
223,600
420,431
21.2.2 Service and performance rights
a. The Company has the following service and performance rights issued to directors in existence during the current
reporting period.
Class of
Performance
Right
Grant date
Expiry date
Number of
rights
Vested during
the year
Rights
exercised
Rights expired
2020 performance 16.12.2020
31.12.2022
4,037,117
4,037,117
2021 performance 13.05.2021
31.12.2023
1,870,172
2022 performance 13.05.2022
31.12.2024
2,024,858
2023 performance 30.05.2023
31.12.2025
2,873,372
-
-
-
-
-
-
-
-
-
-
-
Rights vested at
31 December
2023
Rights unvested
at 31 December
2023
4,037,117
-
-
-
-
1,870,172
2,024,858
2,873,372
b. Vesting of the service rights issued in the period is subject to continuing employment, with no other performance
conditions. The performance rights vest subject to:
continuing employment,
minimum performance hurdle of a minimum share price compound annual growth rate (CAGR) increases of 5%
over the performance period,
no performance rights will vest if CAGR is less than 5% over the respective period,
50% of the performance rights will vest if CAGR of 10% is achieved, up to maximum of 100% of the performance
rights will vest if CAGR of 15% is achieved and pro rata of the performance rights will vest if CAGR is >5% &<10%
and >10%&<15%.
c. Valuation of the performance rights was undertaken using Monte Carlo valuation methodology with the following
factors and assumptions being used in determining the fair value of each right on the grant date.
Class of
Performance
Right
Class of Performance
Right
Grant date
Period
years
Share price at
grant date
Risk free rate
%
$
2021 performance
13.05.2021
2022 performance
13.05.2022
2023 performance
30.05.2023
3
3
3
0.425
0.375
0.275
0.080
2.825
3.368
Volatility
%
70
70
65
Valuation per
right
$
0.1938
0.2246
0.1223
Class of
Performance
Right
Class of Performance
Right
Grant date
Expiry date
Total valuation
$
31 December 2023
$
31 December 2022
$
Expense recorded to
2020 service
16.12.2020
18.12.2022
2020 performance
16.12.2020
31.12.2022
2021 performance
13.05.2021
31.12.2023
2022 performance
13.05.2022
31.12.2024
2023 performance
30.05.2023
31.12.2025
306,000
1,360,105
362,347
454,783
351,413
-
-
120,782
151,594
117,138
389,514
146,625
666,174
120,782
151,594
-
1,085,175
P a g e | 63
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 21 Share-based payments (cont.)
21.3 Movement in Company options share-based payment arrangements during the period
21.3.1 A summary of the movements of all Company options issued as share-based payments is as follows:
2023
2022
Number of
Options
Weighted Average
Exercise Price
Number of
Options
Weighted Average
Exercise Price
Outstanding at the beginning of the year
1,000,000
$0.55
-
-
Granted
Exercised
-
-
-
-
Expired or lapsed
(1,000,000)
$0.55
Outstanding at year-end
Exercisable at year-end
-
-
-
-
1,000,000
$0.55
-
-
-
-
1,000,000
$0.55
1,000,000
$0.55
21.3.2 Share options outstanding at the end of the year have the following expiry dates and exercise prices:
Grant
date
Expiry
date
Exercise Price
$
2023
No.
2022
No.
11.04.2022
11.04.2026
11.04.2022
11.04.2027
11.04.2022
11.04.2027
19.05.2022
20.06.2025
0.45
0.55
0.65
0.55
6,600,000
7,700,000
8,800,000
6,600,000 See note 21.3.2a
7,700,000 See note 21.3.2a
8,800,000 See note 21.3.2a
-
1,000,000 See note 21.3.2b
23,100,000
24,100,000
Weighted average remaining contractual life of options
outstanding at end of period (years)
3.38
4.30
a. 23.1 million options with issued to Messrs Castiglioni and Milone as free attaching in respect to their subscription of
for 1.5 million Vmoto Shares respectively, at an issue $0.353 per share per share. If exercised in full, these options
will inject a further $12.9 million in cash into the Company. These were not deemed to be a share-based payment
and form part of the shares issued pursuant to note 7.1.1b.
b. 1 million options were to an advisor for investor relation services provided. Vesting conditions were not met and the
options were forfeited the current period.
21.4 Accounting policy
The Group has provided payment to service providers and related parties in the form of share-based compensation whereby
services are rendered in exchange for shares or rights over shares, equity-settled transactions. The cost of these equity-
settled transactions is measured by reference to the fair value at the date at which they are granted. The fair value is
determined using an appropriate valuation model for services provided by employees or where the fair value of the goods
or services received cannot be reliably estimated.
For goods and services received where the fair value can be determined reliably the goods and services and the
corresponding increase in equity are measured at that fair value. The fair value of the options granted is adjusted to reflect
market vesting conditions, but excludes the impact of any non-market vesting conditions. Non-market vesting conditions
are included in assumptions about the number of options that are expected to become exercisable.
At each balance date, the entity revises its estimates of the number of options with non-market vesting conditions that are
expected to become exercisable. The cost of equity-settled transactions is recognised, together with a corresponding
increase in equity, over the period in which the performance conditions are fulfilled, ending on the date on which the
relevant parties become fully entitled to the award, vesting date.
P a g e | 64
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 21 Share-based payments (cont.)
21.4 Accounting policy
ANNUAL REPORT
31 December 2023
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (i) the
extent to which the vesting period has expired and (ii) the number of awards that, in the opinion of the Directors of the
Group, will ultimately vest. This opinion is formed based on the best available information at balance date. No adjustment
is made for the likelihood of market performance conditions being met as the effect of these conditions is included in the
determination of fair value at grant date.
Where the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not
been modified. In addition, an expense is recognised for any increase in the value of the transaction as a result of the
modification, as measured at the date of modification.
21.5 Key estimate
a. Share-based payments
The Group measures the cost of equity-settled transactions by reference to the fair value of the equity instrument at the
date at which they are granted. The fair value of rights and options granted is measured using the Binomial and Monte
Carlo pricing models where appropriate. The models use assumptions and estimates as inputs. The assumptions and
models used for estimating fair value for share-based payment transactions are disclosed in note 21.2.2c.
Note 22 Operating segments
22.1
Identification of reportable segments
The Group has identified its operating segments based on the internal reports that are provided to the Board of Directors
(the Board) monthly and in determining the allocation of resources.
22.2 Types of services
The continuing operations of the Group are predominantly in the electric two-wheel vehicles manufacture and distribution
industry. The principal activity of the Group is the design, manufacture, marketing, and distribution of electric two-wheel
vehicles.
22.3 Reported segments
Reported segments were based on the geographical segments of the Group, being Australia, China, Europe and Singapore.
The management accounts and forecasts submitted to the chief operating decision maker for the purpose of resource
allocation and assessment of segment performance are split into these components.
The electric two-wheel vehicles segment is managed on a worldwide basis, but operates in four principal geographical areas:
Australia, China, Europe and Singapore. In China, manufacturing facilities are operated in Nanjing. In Europe, the warehouse
and distribution centre are operated in the Netherlands and Italy.
22.4 Basis of accounting for purposes of reporting by operating segments
22.4.1 Accounting policies adopted
Unless stated otherwise, all amounts reported to the Board, being the chief decision maker with respect to operating
segments, are determined in accordance with accounting policies that are consistent to those adopted in the annual financial
statements of the Group.
22.4.2 Inter-segment transactions
All such transactions are eliminated on consolidation of the Group's financial statements. Inter-segment loans payable and
receivable are initially recognised at the consideration received/to be received net of transaction costs. If inter-segment
loans receivable and payable are not on commercial terms, these are not adjusted to fair value based on market interest
rates. This policy represents a departure from that applied to the statutory financial statements.
22.4.3 Segment assets and liabilities
Where an asset is used across multiple segments, the asset is allocated to that segment that receives majority economic
value from that asset. In the majority of instances, segment assets are clearly identifiable on the basis of their nature and
physical location.
Liabilities are allocated to segments where there is a direct nexus between the incurrence of the liability and the operations
of the segment. Borrowings and tax liabilities are generally considered to relate to the Group as a whole and are not
allocated. Segment liabilities include trade and other payables and certain direct borrowings.
P a g e | 65
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 22 Operating segments (cont.)
22.4.4 Unallocated items
The following items of revenue, expenses, assets, and liabilities are not allocated to operating segments as they are not
considered part of the core operations of any segment:
Head office and corporate costs;
Net gains on disposal of available-for-sale investments;
Impairment of assets and other non-recurring items of revenue and expense;
Income tax expense;
Current and deferred tax assets and liabilities;
Other financial assets;
Intangibles assets; and
Discontinued operations.
22.5 Segment Financial
Performance
Year ended 31 December 2023
Revenue
Continuing operations
Australia
$’000
China
$’000
Europe
$’000
Singapore
$’000
Intersegment
eliminations
$’000
Total
operations
$’000
Sales to external customers
-
56,273
12,195
1,062
(282)
69,248
Results
Profit or loss after income tax
(1,336)
10,852
(2,462)
204
Year ended 31 December 2022
Revenue
Sales to external customers
6
107,736
8011
Results
Profit or loss after income tax
(276)
10,545
(219)
920
168
-
-
-
_
7,258
_
116,673
_
10,218
_
22.6 Segment Financial Position
Continuing operations
Australia
$’000
China
$’000
Europe
$’000
Singapore
$’000
Intersegment
eliminations
$’000
Total
operations
$’000
As at 31 December 2023
Assets
Segment assets
Liabilities
Segment liabilities
As at 31 December 2022
Assets
Segment assets
Liabilities
Segment liabilities
22.7 Major customers
4,905
126,131
13,555
752
(49,026)
96,317
483
58,339
5,907
1,117
(49,026)
_
16,820
_
1,934
106,590
7,154
624
(35,316)
80,986
148
52,744
4,836
38
(35,316)
_
22,450
_
The Group has generated revenue from sales to its largest customer at approximately $6.6 million (2022: $19.9 million).
No other single customers contributed 15% or more of the Group’s revenue for the year.
P a g e | 66
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 23 Statement of significant accounting policies
ANNUAL REPORT
31 December 2023
This note provides a list of the significant accounting policies adopted in the preparation of these consolidated financial
statements to the extent they have not already been disclosed in the other notes above. These policies have been consistently
applied to all the periods presented, unless otherwise stated.
23.1 Basis of preparation
23.1.1 Reporting Entity
Vmoto Limited (Vmoto or the Company) is a listed public company limited by shares, domiciled and incorporated in
Australia. These are the consolidated financial statements and notes of Vmoto and controlled entities (collectively the
Group). The financial statements comprise the consolidated financial statements of the Group. For the purposes of preparing
the consolidated financial statements, the Company is a for-profit entity. The Group is a for-profit entity and is designer,
manufacturer, and distributor of high quality electric two-wheel vehicles and related EV business solutions.
The separate financial statements of Vmoto, as the parent entity, have not been presented with this financial report as
permitted by the Corporations Act 2001 (Cth).
23.1.2 Basis of accounting
These financial statements are general purpose financial statements which have been prepared in accordance with
Australian Accounting Standards and Interpretations of the Australian Accounting Standards Board (AAS Board) and
International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB), and the
Corporations Act 2001 (Cth).
Australian Accounting Standards (AASBs) set out accounting policies that the AAS Board has concluded would result in a
financial report containing relevant and reliable information about transactions, events and conditions to which they apply.
Compliance with AASBs ensures that the financial statements and notes also comply with IFRS as issued by the IASB.
The financial statements were authorised for issue on 27 March 2024 by the Board of Directors of the Company.
23.1.3 Going Concern
The financial report has been prepared on a going concern basis, which contemplates the continuity of normal business
activity and the realisation of assets and the settlement of liabilities in the ordinary course of business.
The Group generated a profit for the year of $7.26 million (31 December 2022: $10.22 million profit) and a net cash in-flow
from operating activities of $3.87 million (31 December 2022: $9.51 million in-flow). As at 31 December 2023, the Company
had working capital of $57.04 million (31 December 2023: $46.64 working capital).
At the date of this report, and having considered the above factors, the Directors are confident that the Group and the
Company will be able to continue operations into the foreseeable future.
23.1.4 Comparative figures
Where required by AASBs comparative figures have been adjusted to conform to changes in presentation for the current
year.
Where the Group retrospectively applies an accounting policy, makes a retrospective restatement or reclassifies items in its
financial statements, an additional (third) statement of financial position as at the beginning of the preceding period in
addition to the minimum comparative financial statements is presented.
23.1.5 New and Amended Standards Adopted by the Group
The Group has applied the following standards and amendments for the first time for their annual reporting period
commencing 1 January 2023:
AASB 17 Insurance Contracts.
AASB 2023-2 Amendments to Australian Accounting Standards – Definition of Accounting Estimates International Tax
Reform – Pillar Two Model Rules [AASB 112].
AASB 2021-5 Amendments to Australian Accounting Standards – Deferred Tax related to Assets and Liabilities arising
from a Single Transaction [AASB 112].
AASB 2021-2 Amendments to Australian Accounting Standards – Disclosure of Accounting Policies Definition of
Accounting Estimates [AASB 7, AASB 101, AASB 108, AASB 134 & AASB Practice Statement 2].
The amendments listed above did not have any impact on the amounts recognised in prior periods and are not expected to
significantly affect the current or future periods.
P a g e | 67
ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 23 Statement of significant accounting policies
23.2 Valued added taxes
Value-added tax (VAT) is the generic term for the broad-based consumption taxes that the Group is exposed to such as:
Australia (Goods and Services Tax or GST); the United Kingdom and Europe (VAT); and in China (VAT).
VAT broad-based consumption taxes that the Group is exposed to.
Revenues, expenses, and assets are recognised net of the amount of VAT, except where the amount of VAT incurred is not
recoverable from the taxation authority. In these circumstances the VAT is recognised as part of the cost of acquisition of
the asset or as part of an item of the expense. Receivables and payables in the statement of financial position are shown
inclusive of VAT.
The net amount of VAT recoverable from, or payable to, the local jurisdictional Taxation Office is included as a current asset
or liability in the balance sheet.
Cash flows are presented in the statement of cash flows on a gross basis, except for the VAT component of investing and
financing activities, which are disclosed as operating cash flows.
Commitments and contingencies are disclosed net of the amount of VAT recoverable from, or payable to, the taxation
authority.
VAT is subject to local jurisdictional regulation which includes specific rates of VAT.
23.3 Foreign currency transactions and balances
23.3.1 Functional and presentation currency
The consolidated financial statements of the Group are presented in Australian dollars, which is different from its functional
currency, determined to be Renminbi. A different presentation currency has been adopted as the Board of Directors believe
that financial statements presented in Australian dollar (which is the functional currency of parent company) are more useful
to the users and shareholders of the Company who are predominantly in Australia.
23.3.2 Foreign currency translation
Transactions in foreign currencies are initially recorded in the functional currency at the exchange rates ruling at the date of
the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange
ruling at the reporting date.
All differences in the consolidated financial report are taken to the Statement of Profit or Loss with the exception of
differences on foreign currency borrowings that provide a hedge against a net investment in a foreign entity. These are taken
directly to equity until the disposal of the net investment, at which time they are recognised in the Statement of Profit or
Loss.
Tax charges and credits attributable to exchange differences on those borrowings are also recognised in equity.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange
rate as at the date of the initial transaction. Non-monetary items measured at fair value in a foreign currency are translated
using the exchange rates at the date when the fair value was determined.
As at the reporting date the assets and liabilities of these overseas subsidiaries are translated into the presentation currency
of Vmoto at the rate of exchange ruling at the reporting date and the income statements are translated at the weighted
average exchange rates for the period where this rate approximates the rate at the date of the transaction.
The exchange differences arising on the retranslation are taken directly to a separate component of equity.
On disposal of a foreign entity, the deferred cumulative amount recognised in equity relating to that particular foreign
operation is recognised in the Statement of Profit or Loss.
23.4 Use of estimates and judgments
The preparation of consolidated financial statements requires management to make judgements, estimates and
assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses.
These estimates and associated assumptions are based on historical experience and various factors that are believed to be
reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of
assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised
in the period in which the estimate is revised and in any future periods affected.
Judgements made by management in the application of AASBs that have significant effect on the consolidated financial
statements and estimates with a significant risk of material adjustment in the next year are discussed in Note 23.4.1.
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VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 23 Statement of significant accounting policies
23.4.1 Critical Accounting Estimates and Judgments
ANNUAL REPORT
31 December 2023
Management discusses with the Board the development, selection and disclosure of the Group's critical accounting policies
and estimates and the application of these policies and estimates. The estimates and judgements that have a significant risk
of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed
below.
a. Key estimate – Taxation ........................................................................................ Refer note 4.8 Income tax.
b. Key judgement and keys estimate – Impairment of intangibles ......................... Refer note 6.4 Intangible assets.
c. Key estimate – Share-base payments .................................................................. Refer note 21 Share-based payments.
23.5 Fair Value
23.5.1 Fair Value of Assets and Liabilities
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 AASB.
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
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 considers 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 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.
23.5.2 Fair value hierarchy
AASB 13 Fair Value Measurement requires the disclosure of fair value information by level of the fair value hierarchy, which
categorises fair value measurements into one of three possible levels based on the lowest level that an input that is
significant to the measurement can be categorised into as follows:
Level 1
Level 2
Level 3
Measurements based on quoted prices
(unadjusted) in active markets for
identical assets or liabilities that the
entity can access at the measurement
date.
Measurements based on inputs other than
quoted prices included in Level 1 that are
observable for the asset or liability, either
directly or indirectly.
Measurements based on unobservable
inputs for the 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. If all significant
inputs required to measure fair value are observable, the asset or liability is included in Level 2. If one or more significant
inputs are not based on observable market data, the asset or liability is included in Level 3.
The Group would change the categorisation within the fair value hierarchy only in the following circumstances:
if a market that was previously considered active (Level 1) became inactive (Level 2 or Level 3) or vice versa; or
if significant inputs that were previously unobservable (Level 3) became observable (Level 2) or vice versa.
When a change in the categorisation occurs, the Group recognises transfers between levels of the fair value hierarchy (i.e.,
transfers into and out of each level of the fair value hierarchy) on the date the event or change in circumstances occurred.
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ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Notes to the consolidated financial statements
for the year ended 31 December 2023
Note 23 Statement of significant accounting policies
23.5.3 Valuation techniques
The Group selects a valuation technique that is appropriate in the circumstances and for which sufficient data is available to
measure fair value. The availability of sufficient and relevant data primarily depends on the specific characteristics of the
asset or liability being measured. The valuation techniques selected by the Group are consistent with one or more of the
following valuation approaches:
Market approach: valuation techniques that use prices and other relevant information generated by market transactions
for identical or similar assets or liabilities.
Income approach: valuation techniques that convert estimated future cash flows or income and expenses into a single
discounted present value.
Cost approach: valuation techniques that reflect the current replacement cost of an asset at its current service capacity.
Each valuation technique requires inputs that reflect the assumptions that buyers and sellers would use when pricing the
asset or liability, including assumptions about risks. When selecting a valuation technique, the Group gives priority to those
techniques that maximise the use of observable inputs and minimise the use of unobservable inputs. Inputs that are
developed using market data (such as publicly available information on actual transactions) and reflect the assumptions that
buyers and sellers would generally use when pricing the asset or liability are considered observable, whereas inputs for
which market data is not available and therefore are developed using the best information available about such assumptions
are considered unobservable.
23.6 New Accounting Standards and Interpretations not yet mandatory or early adopted
Certain new accounting standards and interpretations have been published that are not mandatory for 31 December 2023
reporting periods and have not been early adopted by the Group. These standards are not expected to have a material
impact on the entity in the current or future reporting periods and on foreseeable future transactions.
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VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Directors' declaration
ANNUAL REPORT
31 December 2023
The Directors of the Company declare that in the Directors' opinion:
1. The attached financial statements and notes, as set out on pages 26 to 70, are in accordance with the Corporations Act 2001
(Cth) including:
(a) complying with Accounting Standards, the Corporations Regulations 2001, and other mandatory professional reporting
requirements; and
(b) giving a true and fair view of the Group’s financial position as at 31 December 2023 and of its performance for the financial
year ended on that date
2. there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and
payable.
Note 23.1.2 confirms that the financial statements also comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board.
The Directors have been given the declarations by the chief executive officer and chief financial officer required by section 295A
of the Corporations Act 2001 (Cth);
This declaration is signed in accordance with a resolution of the Directors made pursuant to section 295(5) of the Corporations
Act 2001 (Cth).
On behalf of the Directors
CHARLES CHEN
Managing Director
Dated this Wednesday, 27 March 2024
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ANNUAL REPORT
31 December 2023
Independent auditor's report
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
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ABN 36 098 455 460
ANNUAL REPORT
31 December 2023
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31 December 2023
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ABN 36 098 455 460
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ABN 36 098 455 460
ANNUAL REPORT
31 December 2023
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ABN 36 098 455 460
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VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
ANNUAL REPORT
31 December 2023
Corporate governance statement
The Board is responsible for establishing the Company’s corporate governance framework. In establishing its corporate
governance framework, the Board has referred to the 4th edition of the ASX Corporate Governance Councils’ Corporate
Governance Principles and Recommendations.
The Corporate Governance Statement discloses the extent to which the Company follows the recommendations. The Company
will follow each recommendation where the Board has considered the recommendation to be an appropriate benchmark for its
corporate governance practices. Where the Company’s corporate governance practices will follow a recommendation, the Board
has made appropriate statements reporting on the adoption of the recommendation. In compliance with the “if not, why not”
reporting regime, where, after due consideration, the Company’s corporate governance practices will not follow a
recommendation, the Board has explained its reasons for not following the recommendation and disclosed what, if any,
alternative practices the Company will adopt instead of those in the recommendation.
The Company’s governance-related documents can be found on its website at https://vmoto.com/investorcentre/.
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ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Additional Information for Listed Public Companies
The following additional information is required by the Australian Securities Exchange in respect of listed public companies.
1
Capital as at 8 March 2024
a. Ordinary share capital
395,487,192 ordinary fully paid shares held by 4,024 shareholders.
b. Options over Unissued Shares
Number of
Options
Exercise Price
$
6,600,000
7,700,000
8,800,000
23,100,000
0.45
0.55
0.65
Expiry
Date
11.04.2026
11.04.2027
11.04.2027
ASX
Status
Unlisted
Unlisted
Unlisted
c. Performance Rights over Unissued Shares
Performance Condition
Class of
Performance
Right
2022 Continuing employment;
Minimum performance hurdle of a minimum share
Milestone Date
Expiry Date
Performance
rights
No.
2,024,858
31.12.2024
31.12.2024
price compound annual growth rate (CAGR) increases
of 5% over the performance period;
No performance rights will vest if CAGR is less than 5%
over the respective period; and
50% of the performance rights will vest if CAGR of
10% is achieved, up to maximum of 100% of the
performance rights will vest if CAGR of 15% is
achieved and pro rata of the performance rights will
vest if CAGR is >5%&<10% and >10%&<15%.
2023 Continuing employment;
Minimum performance hurdle of a minimum share
2,873,372
31.12.2025
31.12.2025
price compound annual growth rate (CAGR) increases
of 5% over the performance period;
No performance rights will vest if CAGR is less than 5%
over the respective period; and
50% of the performance rights will vest if CAGR of
10% is achieved, up to maximum of 100% of the
performance rights will vest if CAGR of 15% is
achieved and pro rata of the performance rights will
vest if CAGR is >5%&<10% and >10%&<15%.
d. Voting Rights
The voting rights attached to each class of equity security are as follows:
4,898,230
Ordinary shares: The voting rights attaching to ordinary shares are that on a show of hands every member present
in person or by proxy shall have one vote and upon a poll each share shall have one vote.
Options: Options do not entitle the holders to vote in respect of that equity instrument, nor participate in dividends,
when declared, until such time as the options are exercised or performance shares convert and subsequently
registered as ordinary shares.
Performance Rights: A Performance Right does not entitle a Holder to vote on any resolutions proposed at a
general meeting of shareholders of the Company. A Performance Right does not entitle a Holder to any dividends.
A Performance Right does not entitle the Holder to participate in the surplus profits or assets of the Company upon
winding up of the Company. A Performance Right is not transferable.
e. Substantial Shareholders as at 8 March 2024
Name
Yiting (Charles) Chen
Raymond and Susan Munro ATF Munro Family Super Fund
Malaky Kazem
Number of Ordinary
Fully Paid Shares Held
% Held of Issued Ordinary
Capital
46,007,910
22,044,500
21,736,030
11.63
5.57
5.50
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VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
ANNUAL REPORT
31 December 2023
Additional Information for Listed Public Companies
f. Distribution of Equity Holders as at 8 March 2024
Ordinary Shares
Category (size of
holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
Total Holders
Number
Ordinary
% Held of Issued
Ordinary Capital
429
1,518
627
1,153
297
4,024
224,552
4,172,465
5,028,318
38,593,414
347,468,443
395,487,192
0.06
1.06
1.27
9.75
87.85
99.99
Unlisted Options (VMTAY: Exp. 11.04.2026 Ex. $0.45)
Total Holders
Category (size of
holding)
Number
Ordinary
% Held of Issued
Ordinary Capital
1 – 100,000
100,001 – and over
-
2
2
-
6,600,000
0.00
100.00
6,600,000
100.00
Unlisted Options (VMTAZ: Exp. 11.04.2027 Ex. $0.55)
Total Holders
Category (size of
holding)
Number
Ordinary
% Held of Issued
Ordinary Capital
1 – 100,000
100,001 – and over
-
2
2
-
7,700,000
0.00
100.00
7,700,000
100.00
Unlisted Options (VMTAA: Exp. 11.04.2027 Ex. $0.65)
Category (size of
holding)
1 – 100,000
100,001 – and over
Total Holders
Number
Ordinary
% Held of Issued
Ordinary Capital
-
2
2
-
8,800,000
0.00
100.00
8,800,000
100.00
2022 Performance Rights Holders
Total Holders
Category (size of
holding)
Number
Ordinary
% Held of Issued
Ordinary Capital
1 – 100,000
100,001 – and over
-
2
2
-
2,024,858
0.00
100.00
2,024,858
100.00
2023 Performance Rights Holders
Total Holders
Category (size of
holding)
Number
Ordinary
% Held of Issued
Ordinary Capital
1 – 100,000
100,001 – and over
-
2
2
-
2,873,372
0.00
100.00
2,873,372
100.00
g. Unmarketable Parcels as at 8 March 2024
There were 1,506 shareholders who held less than a marketable parcel of shares, holding 245,986 shares.
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ANNUAL REPORT
31 December 2023
VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
Additional Information for Listed Public Companies
h. On-Market Buy-Back
There is no current on-market buy-back.
i. Restricted Securities
The Company has currently the following restricted securities:
1,720,000 fully paid ordinary shares are currently subject to voluntary escrow until 4 April 2025.
810,000 fully paid ordinary shares are currently subject to voluntary escrow until 22 February 2026.
j. 20 Largest Shareholders — Ordinary Shares as at 8 March 2024
Rank Name
Number of Ordinary
Fully Paid Shares Held
% Held of Issued
Ordinary Capital
1.
2.
3.
4.
5.
6.
7.
8.
Mr Yiting Chen
Mr Yuming Zhou
Mr Yi Chen
Ms Malaky Kazem
Mr Raymond Edward Munro + Mrs Susan Roberta Munro
Chengzhi Wang
Mr Erchuan Zhou
Mr Liang Rong
Citicorp Nominees Pty Limited
9.
10. Mr Tao Yu
11. Mr Yin How Teo
12. HSBC Custody Nominees (Australia) Limited
13. Mr Brendan David Gore
14. BNP Paribas Nominees Pty Ltd
15. Mr Kaijian Chen
16. Mr Liang Chen
17. Yang Pty Ltd
18. Mr Lei Liu
19. Edlins Prosperity Plus Pty Ltd
20. Mr Michael Arnold Ter Veer
46,007,910
45,110,880
37,073,109
23,544,030
22,048,500
16,017,317
15,589,942
7,800,000
5,504,881
4,241,393
4,075,000
3,871,016
3,245,000
3,203,774
3,139,401
3,047,787
2,392,355
2,183,863
2,089,352
2,000,000
11.63
11.41
9.37
5.95
5.58
4.05
3.94
1.97
1.39
1.07
1.03
0.98
0.82
0.81
0.79
0.77
0.60
0.55
0.53
0.51
Total
252,185,510
63.75
k. Unquoted Securities Holders Holding More than 20% of the Class as at 8 March 2024
Unlisted Options (VMTAY: Exp. 11.04.2026 Ex. $0.45)
Name
Giovanni Castiglioni
Total
Total Unlisted Options (VMTAY: Exp. 11.04.2026 Ex. $0.45)
Rank
Unlisted Options (VMTAZ: Exp. 11.04.2027 Ex. $0.55)
Name
Giovanni Castiglioni
Total
Total Unlisted Options (VMTAZ: Exp. 11.04.2027 Ex $0.55)
Number of Unquoted
Securities
% Held of Unquoted
Security Class
6,000,000
6,000,000
6,600,000
90.91
90.91
Number of Unquoted
Securities
% Held of Unquoted
Security Class
7,000,000
7,000,000
7,700,000
90.91
90.91
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VMOTO LIMITED AND CONTROLLED ENTITIES
ABN 36 098 455 460
ANNUAL REPORT
31 December 2023
Additional Information for Listed Public Companies
Rank
Unlisted Options (VMTAA: Exp. 11.04.2027 Ex. $0.65)
Name
Giovanni Castiglioni
Total
Total Unlisted Options (VMTAA: Exp. 11.04.2027 Ex $0.65)
2022 Performance Rights Holders
Rank Name
1.
2.
Yiting (Charles) Chen
Yin How (Ivan) Teo
Total
Total 2022 Performance Shares
2023 Performance Rights Holders
Rank Name
1.
2.
Yiting (Charles) Chen
Yin How (Ivan) Teo
Total
Total 2023 Performance Shares
Number of Unquoted
Securities
% Held of Unquoted
Security Class
8,000,000
8,000,000
8,800,000
90.91
90.91
Number of Unquoted
Securities
% Held of Unquoted
Security Class
1,372,346
652,512
2,024,858
2,024,858
67.77
32.23
100.00
Number of Unquoted
Securities
% Held of Unquoted
Security Class
1,903,609
969,763
2,873,372
2,873,372
66.25
33.75
100.00
2
3
The Company Secretary is Joan Dabon.
Principal registered office
As disclosed in the Corporate directory on page i of this Annual Report.
4
Register of securities
As disclosed in the Corporate directory on page i of this Annual Report.
5
Stock exchange listing
Quotation has been granted for all the ordinary shares of the Company on all Member Exchanges of the Australian Securities
Exchange Limited (ASX Code: VMT), as disclosed in the Corporate directory on page i of this Annual Report. The Home Exchange
is Perth.
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