ANNUAL
REPORT
2022
WISR LIMITED • ANNUAL REPORT 2022 CONTENTS
Our Vision
Chairman’s Review
CEO’s Review
Set up for profitability
• FY22 highlights
• Wisr has a unique and differentiated strategy
• Dual platform strategy is delivering growth and scale
• Growth built on consistent high credit quality
• Proprietary data algorithm Wisr Score
Managing a changing economic environment
• Protecting NIM and yield to deliver profit
• Focussing on achieving profitability within 12 months
• Operational leverage expansion
• Strong funding platform
• Cash EBTDA
• Profitability to be achieved within 12 months
Environment, Social and Governance
Award-winning momentum
Executive Leadership Team
Board of Directors
Financial report
• Directors’ report
• Auditor’s independence declaration
• Consolidated statement of profit or loss and other income
• Consolidated statement of financial position
• Consolidated statement of changes in equity
• Consolidated statement of cash flows
• Notes to the financial statements
Directors’ declaration
Independent auditor’s report
ASX additional information
Corporate directory
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OUR VISION
IS TO BRING
FINANCIAL
WELLNESS
TO ALL
AUSTRALIANS
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WISR LIMITED • ANNUAL REPORT 2022 3
CHAIRMAN’S
REVIEW
John Nantes
EXECUTIVE CHAIRMAN
Dear Shareholders,
On behalf of the Wisr Board of Directors, it’s my
pleasure to present the Wisr Annual Report for FY22.
I’m immensely proud of the prime, low-risk, profitable
and growing loan book that Wisr’s business model has
delivered in FY22, including the following key
achievements:
• 24 consecutive quarters of prime-credit growth,
surpassing $1.2B in total loan originations
• Two consecutive positive operating cash-flow
quarters (Q2FY22 and Q3FY22)
• Operating revenue of $59M, a 118% increase on
FY21 ($27M)
• Priced our second ABS deal receiving significant
support from the debt market; and
• Maintained a strong balance sheet with $71.5M
cash (including $23.3M unrestricted cash).
Wisr’s robust funding strategy enabled the Company
to respond quickly to the rapidly changing debt
market conditions in H2FY22. With multiple levers to
pull, including raising interest rates on new loans to
increase the average yield of our loan book, we are
well placed to navigate against a rising interest rate
and inflation environment.
FY22 has also seen rapid change in societal
expectations of businesses in serving the public
good.
Since inception, Wisr has been a purpose-driven
company built around creating a positive impact for
Australian consumers. Our purpose guides everything
from our business model, strategy and products to
our culture and behaviours.
Notably, our lending products have no ongoing or
early repayment fees, we offer loan terms of 3, 5 or 7
years, and our platform helps customers understand
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WISR LIMITED • ANNUAL REPORT 2022 and improve their credit health. We want to support
customers to reduce debt faster and improve their
financial position.
We are proud that Wisr is leading from the front on
the key issues shaping today’s society. We are a
climate-positive and carbon-neutral workforce that
has offset 1,517 tonnes (including the working from
home footprint of our staff) through projects that
deliver measurable benefits aligned with the aims of
the Paris Agreement and the UN Sustainable
Development Goals.1
Wisr does not have a gender pay gap. As part of the
Workplace Gender Equality Agency (WGEA) reporting
requirements, a like-for-like analysis was undertaken
on 31 March 2022. The Company found roles were
adhering to the published bands per role, regardless
of gender and identified no gender pay gaps.
In April 2020, the Board set a target to achieve a
minimum of 30% female representation on the Board
whilst also adding further depth to Wisr’s governance
capability. In January 2022, we took the first step by
appointing former Deutsche Bank UK Director Cathryn
Lyall to the position of Non-Executive Director. The
Board’s target was exceeded in March 2022, following
the appointment of Kate Whitney, Chief Marketing
and Growth Officer, Marley Spoon Australia, to the
position of Non-Executive Director. With a female
board representation of 40%, the Company is now
above the ASX200 average of 34.6%.2
The appointment of Kate and Cathryn is an exciting
opportunity for the Company, our stakeholders and
customers. Both are highly qualified with diverse
experience and are first-time ASX-board appointees.
Wisr is very proud to support greater gender diversity
on the ASX. A depth of research from Australia and
across the globe clearly shows the positive impact of
female board membership on a company’s growth and
profitability.3
Our high-performance culture at Wisr continued to
receive recognition internally and externally. In
addition to delivering an average +86 Employee
Engagement score for FY22, the Company was
awarded two prestigious awards in the 2022 AFR Best
Places to Work Awards - rising to #2 in the Banking,
Superannuation & Financial Services category and
taking out the Most Outstanding Practice for the
Diversity & Inclusion Award.
BUILDING FINANCIAL STRENGTH
Throughout FY22, Wisr continually reviewed the
Company’s credit decisions to drive strong organic
growth while optimising the profitability of the loan
book.
At 30 June 2022, Wisr had a total loan book of $803M
(FY21: $432M). Operating revenue grew to $59M, a
118% increase on FY21 ($27M), while operating
expenses increased by 47%, demonstrating continued
operational leverage. This also drove Wisr’s maiden
positive operating cash flow and Cash EBTDA quarter
(Q2FY22). Revenue growth and continued scaling
delivered a second consecutive positive operating
cash-flow quarter (Q3FY22).
The Company generated Cash EBTDA of $(7.2)M in
FY22, a 30% improvement on FY21 ($(10.2)M) and an
increase in loss before tax of 13% to $(19.9)M (FY21
$(17.6)M), predominantly driven by the material
non-cash provision for expected credit loss expense
of $16.4M (FY21 $7.9M) due to the significant growth
in the loan book.
Wisr wrote a record level of prime quality credit during
FY22 while achieving 90+ day arrears of 0.98% as at
30 June 2022 (Q4FY21: 0.65%).
The Company is well capitalised with $71.5M cash
($23.3M unrestricted cash) and $8.2M liquid loan
assets as at 30 June 2022. The liquid loan assets are
sold into the warehouse trusts at regular intervals and
are relevant to the Company’s capital position.
1 Through partnership with trace https://www.our-trace.com/our-projects
2 https://www.moneymanagement.com.au/news/financial-planning/gender-diversity-lagging-asx-boards#:~:text=The%20ASX%20200%20in%202015,It%20was%20now%20at%20
33.1%25.
3 In October 2011, the non-profit research organisation, Reibey Institute, reported that over three- and five-year periods, ASX500 companies with women directors delivered significantly
higher return on equity (ROE) than those companies without any women on their boards (6.7% higher over three years and 8.7% higher over five years) respectively.
5
LOOKING FORWARD TO THE YEAR AHEAD
To maintain a strong balance sheet and be set on a
path to being profitable within 12 months1, the
Company has increased loan pricing and reduced
operating costs. Whilst we expect these operational
initiatives will see the Company’s growth moderate in
FY23, we believe this is a prudent path for the
business given the macroeconomic backdrop.
We are confident that Wisr’s prime loan book, our
differentiated purpose-built business model and the
high-performance culture of the entire Wisr team,
positions the Company to deliver strong financial
performance through the cycle.
To our shareholders, on behalf of the Wisr Board, we
sincerely thank you for your ongoing support.
Lastly, I would like to thank the Board, Executive
Management and all of Wisr’s staff for their continued
support, vision and expertise as we continue
improving Australia’s consumer credit experience.
1 Profitability is on a run-rate Cash EBTDA basis and is subject to broader market
conditions, including any significant volatility events, the level of global inflation and
interest rates, and the impact of any geopolitical events.
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WISR LIMITED • ANNUAL REPORT 2022 7
In FY22, despite the macroeconomic challenges of
inflation and subsequent interest rate rises, we
reaffirmed Wisr’s place as one of Australia’s fastest-
growing and most innovative companies. We are a
growth Company and will be a growth Company for
the next decade or more as we seek to materially
increase our share of the c. $150B consumer finance
market in Australia.
We delivered $611M in newly originated prime-credit
loans at an annual growth rate of 67%, and all built on
a foundation of high credit quality, which sets us up
well as we head into a period of economic uncertainty.
We extended our safe, consistent loan growth to 24
consecutive quarters, surpassing $1.2B in total loan
originations; grew operating revenue by 118% to $59M
and increased our loan book by 103% to $780M.
These results and how we have managed the
Company allowed us to deliver two positive operating
cash-flow quarters, clearly demonstrating we were
well on the way to profitability before the change in
market conditions dramatically affected our cost base
and margins. We have rapidly responded to these
changed conditions, making several decisions to
correct our course back through profitability and
protect our margins as we go forward.
We climbed 66 places to #12 in the AFR Fastest
Starters and placed #21 in the Deloitte Technology
Fast 50 Awards.
We welcomed one of Australia’s largest institutional
fund managers as a mezzanine investor in the Wisr
Warehouse (WH1) and priced our second ABS
transaction ($250M) with a weighted average margin
of 2.23% over one-month BBSW. Continuing to
originate credit assets of the highest quality is
paramount within the current market uncertainty, as is
the broad support of the debt market.
I’m incredibly proud of the results we have achieved.
It’s a phenomenal validation of our purpose-built
CEO’S
REVIEW
Anthony Nantes
CHIEF EXECUTIVE OFFICER
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WISR LIMITED • ANNUAL REPORT 2022 business model, prudent treasury and underwriting
methodology and the capability of the widely
recognised high-performing Wisr Team.
Financial Wellness Platform: Our proprietary channel
passed 647,000 profiles (43% growth on pcp) and is
well on the path to 1M customer profiles.
FY22 PERFORMANCE HIGHLIGHTS
ACCELERATING THE PATH TO PROFITABILITY
Originations: 24 quarters of growth with total new
loan originations up 67% to $611M as at 30 June 2022
(FY21: $366M). Robust growth back-ended the year,
with loan originations of $344M in H2; 28% growth on
H1 $267M.
Revenue: The Company delivered operating revenue
growth of 118% to $59M for the year ending 30 June
2022 (FY21: $27M).
Funding: The $225M Wisr Secured Vehicle
Warehouse (WH2), backed by National Australia Bank,
launched in October 2021. In January 2022, the
successful refinancing of WH1 mezzanine investor
AOFM by IFM was finalised, and funding increased
from $350M to $450M in April 2022. In March 2022,
WH2 committed funding was raised from $225M to
$300M and $400M in July 2022.
Wisr Freedom Trust securitisation: The second ABS
transaction for the Company, the $250M Wisr
Freedom Trust 2022-1 (made up of personal loans),
received a AAA Moody’s rating for the top two
tranches and a weighted average margin of 2.23%
over one-month BBSW, freeing up $250M capacity in
$450M WH1.
On-balance sheet loan book: Growth of 103% to
$780M (FY21: $384M) and on-balance sheet portfolio
90+ day arrears of 0.98% at 30 June 2022 (FY21:
0.65%).
Innovation: The proprietary credit score Wisr Score,
built utilising advanced data analytics, was launched
in February 2022, optimising Wisr’s customer risk-
adjusted return to deliver a more profitable business.
To navigate market conditions in the best position
possible, we have prudently and proactively adjusted
our strategy and cost base to position the Company
for long-term sustainable growth.
The floating BBSW has been hedged since the
inception of warehouse funding facilities in November
2019. To ensure we maintain and protect margin and
profitability, in response to the realised and predicted
increase in Cost of Funds (COF), we have been lifting
loan rates consistently and, as a bank has been,
passing on the rising interest rates on new loans to
customers throughout Q4FY22 and into FY23.
We have made material reductions in operating costs
and raised our yield by around 340bps to protect our
Net Interest Margin (NIM) as we enter FY23 to deliver
profitability in the short-term and moderate our
growth ambitions to focus on the path to profitability.
By taking prudent steps, implementing rate and
pricing levers, tightening credit in line with risk
appetite and significant material reductions in
operating costs, Wisr is in the strongest position to
navigate market conditions and still deliver a strong
revenue growth trajectory over the next 12 months
and positively impact Cash EBTDA.
We have our sights set firmly on moving through
breakeven and into sustainable profitability as our
next goal. Our credit decisions and products are
prime-skewed to bank-grade customers, and we’re
prepared to respond quickly and navigate changing
market conditions.
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FY23 OUTLOOK
We are a growth Company and will be a growth
Company for the next decade or more as we seek to
materially increase our share of the c. $150B
consumer finance market in Australia. However, in the
short term, we have prioritised achieving profitability
within 12 months1 over accelerating growth.
We are well-capitalised and building sustainable
revenue. The strategic adjustments of pausing all new
credit product expansion, innovation and go-to-
market expenditure will drive the push to profitability
further as we continue to demonstrate the strong and
safe fiscal management we are known for.
Our competitive advantage, a purpose-led model that
improves financial wellness and goes far beyond the
traditional lending experience, attracting Australia’s
most creditworthy customers, has never been more
relevant. As consumers demand fairer financial
products and services due to cost-of-living pressures
and rising rates, Wisr is well-placed and well-
resourced to meet the demand.
To our Wisr shareholders, our funders and
stakeholders, thank you for your continued support of
our purpose-led business model and belief in our
mission to improve the financial wellness of all
Australians. To our amazing Wisr Team, thank you for
delivering 24 consecutive quarters of growth, a
world-class high-performance culture, and your
resilience in rapidly changing conditions. I would also
like to thank our Board, and my whole Executive
Team, for your continued support and expertise.
Together, we will embrace the opportunities waiting
for us in FY23, deliver a highly profitable business
with a prime customer base and forever change how
Australians experience consumer finance.
1 Profitability is on a run-rate Cash EBTDA basis and is subject to broader market
conditions, including any significant volatility events, the level of global inflation and
interest rates, and the impact of any geopolitical events.
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WISR LIMITED • ANNUAL REPORT 2022 11
SET UP FOR
PROFITABILITY
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WISR LIMITED • ANNUAL REPORT 2022 FY22 HIGHLIGHTS
$611M
in new loan
originations
$1.2B
Total loan
originations
$59M
in Operating
revenue
$(7)M
Cash EBTDA
67%
(FY21 $366M)
on pcp
Wisr wholly-owned
loan book up 103% to
$780M
118%
(FY21 $27M)
on pcp
30%
improvement on pcp
(FY21 $(10)M)
647K+
Wisr Financial
Wellness
Platform profiles
0.98%
On-balance
sheet 90+ day
arrears
43%
(FY21 451K)
on pcp
as at 30 June 2022
(FY21 0.65%)
$250M
ABS transaction,
Wisr Freedom
Trust 2022-1,
2.23% over one-
month BBSW
Settled 20 June 2022
Market-leading
net promoter
scores
NPS
+76 Business
+86 Employee
Engagement
FY22 results and subsequent Q1FY23 decisions,
sets the Company on a path to be profitable
within 12 months1
Wisr well capitalised with $71.5M cash balance
includes $23.3M unrestricted cash at 30 June
2022
Delivered two positive operating cash flow
quarters in Q2FY22 and Q3FY22 (before the
rapid change in market conditions)
Strong growth backending the year, with loan
originations of $344M in H2; 28% growth on H1
$267M
$250M ABS transaction, Wisr Freedom Trust
2022-1, and AAA rating from Moody’s
Recognition by AFR Best Places to Work (#2 for
category) and overall #1 for Diversity & Inclusion
No gender pay gap and 40% female Board
representation achieved
Wisr Secured Vehicle Warehouse (WH2)
launched in October 2021
1 Profitability is on a run-rate Cash EBTDA basis and is subject to broader market conditions, including any significant volatility events, the level of global inflation and interest rates, and
the impact of any geopolitical events.
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WISR HAS A UNIQUE AND
DIFFERENTIATED STRATEGY
Digital lending
platform
Wisr’s unique
competitive
advantage
Financial wellness
platform
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WISR LIMITED • ANNUAL REPORT 2022 Our tech, data, analytics and high-
performance culture are genuine
competitive advantages
Loan Origination in FY22
was a record $611M (up
67% pcp), delivering:
• $1.2B loans written since inception (Q1FY17)
• 24 consecutive quarters of new loan origination
growth
• Revenue of $59M (up 118% pcp)
• 103% pcp loan book growth (now $780M)
Significant room for growth
is evident in the current
business:
• With more room to win in competitive channels
• Our ability to further optimise risk for growth and
profitability
The success of the Financial
Wellness Platform can be
leveraged, in-line with our
existing budget for this
strategy:
• The data is highly valuable
• It is delivering tangible benefits for customers that
engage with it
• It is already providing a significant ROI for us and
setting us up for larger opportunities
• Demonstrated effectiveness of the Wisr Financial
Wellness Platform as our most cost-effective channel
for loan origination
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DUAL PLATFORM STRATEGY
IS DELIVERING GROWTH AND
SCALE
Lending Platform
Financial Wellness Platform (Profiles1)
1 Financial Wellness Platform has grown to over 647K users and will continue to grow as Company approaches target of 1 million profiles
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WISR LIMITED • ANNUAL REPORT 2022 Wisr quarterly loan book growth1
Accelerating revenue growth
1 Loan Book includes all loans in WH1, WH2, Freedom Trust 2021-1, Freedom Trust 2022-1 and balance sheet, excludes off-balance sheet of $22.7M as at 30 June 2022
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GROWTH BUILT ON
CONSISTENT HIGH CREDIT
QUALITY
Strong credit quality has been achieved in FY22
with prime1 average credit scores and less than 1%
on-balance sheet 90+ day arrears.
Wisr loan customer average
credit score
With 24 consecutive quarters of best-in-class
responsible lending compliance, focus on prime
and super prime credit, maintaining a tight credit
policy, delivering a decrease in provisioning over
time and arrears and credit loss levels being well
inside internal targets, Wisr is prepared to
navigate market conditions.
The framework is already in place to manage
credit quality through the cycle, including
controls such as:
On-balance sheet portfolio
90+ day arrears2
• Early warning indicators
• Proprietary Wisr Score, which provides a more
accurate view of a customer’s financial standing
and optimises risk-adjusted return
• Increased use of digital data with automated
rules around account conduct
• Adoption of Fortiro to identify potential fraud
and limit early default receivables
• Credit policy changes with a greater hindsight
review of historical arrears and tightening credit
in line with risk appetite
• Ongoing investment in collection processes
1 Prime credit score = 726-832 and Superprime credit score = 833-1200; source Equifax https://www.equifax.com.au/personal/what-good-credit-score
2 On-balance sheet portfolio arrears, excludes off-balance sheet.
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WISR LIMITED • ANNUAL REPORT 2022 PROPRIETARY DATA
ALGORITHM WISR SCORE
With $1.2B in loans written, Wisr has significant
customer data to optimise and internalise our lending
engine and risk-return profile. Through the February
2022 launch of our proprietary credit score platform
and algorithm, the Wisr Score, we will be able to make
smarter, faster and more profitable decisions.
Utilising advanced data analytics, the Wisr Score will
drive significantly better outcomes for Wisr in the
coming years as it delivers: faster decisions, a more
scalable business, a better customer experience, a
better risk-adjusted portfolio and a more profitable
business.
WISR
PROPRIETARY
PROFILE
DATA
WISR
PROPRIETARY
FINANCIAL
DATA
ADDITIONAL
ADVANCED
DATA
ANALYTICS
Provides a more accurate view of a
customer’s financial standing (compared to
the traditional bureau score)
Improves credit decision automation
Optimises risk-adjusted return (increase
lending without increasing the net loss
margin), making Wisr more profitable
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MANAGING
A CHANGING
ECONOMIC
ENVIRONMENT
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WISR LIMITED • ANNUAL REPORT 2022 PROTECTING NIM AND YIELD
TO DELIVER PROFIT
Since the inception of warehouse funding facilities in
November 2019, Wisr has hedged the floating
component of its cost of funds – the BBSW.
Wisr will continue to lift yield and pricing in the market
to protect profitability and NIM.
Between April and September 2022, the blended
hedged BBSW cost increased by c. 80 bps. In
response, Wisr has increased the front book weighted
average yield by c. 340 bps between April and
September 20221.
Wisr is well prepared to mitigate current market
conditions and absorb BBSW increases while still
earning a very healthy Net Interest Margin (NIM) with
multiple levers, including raising interest rates on new
loans.
Loan origination yield and BBSW
1 August and September are forecast based on anticipated loan volume, corresponding yield and BBSW
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FOCUSSING ON ACHIEVING
PROFITABILITY WITHIN 12
MONTHS
FY22 results and subsequent
FY23 decisions, sets the
Company on a path to be
profitable within 12 months1
Wisr is a growth Company and will remain a growth
Company for the next decade or more. However,
prudent fiscal management is required at this time,
and the Company will be right-sized and fully
focussed on achieving profitability in the shortest
path possible.
Recognising current market conditions, Wisr is
focussed on delivering both profitability in the short-
term and sustainable long-term profitability. To
maintain a strong balance sheet and deliver a highly
profitable business, we must navigate market
conditions in the best position possible. As such, we
have prudently and proactively adjusted our strategy
and cost base to position the Company for long-term
sustainable growth.
1 Profitability is on a run-rate Cash EBTDA basis and is subject to broader market conditions, including any significant volatility events, the level of global inflation and interest rates, and
the impact of any geopolitical events.
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WISR LIMITED • ANNUAL REPORT 2022 Focus on near-term profitability
• Significant reduction in short-term lending growth
aspirations in response to the macro environment
• Switching from high to moderate growth will
positively impact Cash EBTDA
• Front book yield will continue to lift to ensure the
Company achieves strong NIM and profitability
Cost management
• A material reduction in employee expenses and
headcount
• A material reduction in external spend
Strategic adjustments
• Pausing all new credit product expansion and go-
to-market expenditure
• Exited any continued support for Arbor in the EU
market and any short-term growth ambitions for
geographical expansion
• An overall material reduction in investment in the
Wisr Financial Wellness Platform
23
OPERATIONAL LEVERAGE
EXPANSION
FY22 P&L Waterfall
The operational leverage of the core Wisr lending platform continued to expand while the Company invested in
the Financial Wellness Platform, further innovation and the build and launch of more products.
Revenue
Core opex
Growth opex
Other
Non-cash
118% Operating
revenue growth in
FY22 vs FY21 under
the Wisr Warehouse
funding model and on
the back of 24
consecutive quarters
of loan origination
growth
Opex related directly
to the core personal
and secured vehicle
loan business from
application to
settlement
Predominantly
consists of investment
into the Wisr Financial
Wellness Platform and
investment into the
build and preparation
to launch new
products
Includes Public
Company costs and
one-off items
including the Tokyo
Olympics brand
campaign
Includes ECL
provision, share based
payments and
depreciation
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WISR LIMITED • ANNUAL REPORT 2022 STRONG FUNDING
PLATFORM
• WH1 has $450M of committed funding and an
undrawn capacity of $307M
• Wisr has now delivered two personal loan ABS
transactions - Freedom21 and Freedom22
• WH2 has $300M of committed funding, increased
to $400M in July 2022 and an undrawn capacity of
$125M (post increase)
• The Head Co Loan commitment has reduced from
$21.5M to $6.5M given the strong balance sheet
position. $6.5M was drawn upon inception
• Second ABS transaction (Freedom22) settled for
$250M in June 2022, creating additional funding
capacity within WH1. The year-end balance was
$229M
• Inaugural SVL ABS transaction to be undertaken in
FY23, creating additional funding capacity within
WH2
• Third warehouse of c. $200M to be originated in
FY23 with new senior funder and ability to fund
both PL and SVL
• For both WH1 and WH2, the senior funder is
National Australia Bank (NAB). In WH1, IFM sits
alongside the existing mezzanine funder MA
Financial Group. In WH2, Revolution Asset
Management is the mezzanine funder
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CASH
EBTDA
• In FY22, the Company continued on the path to profitability, with a
Cash EBTDA of $(7.2)M, a 30% improvement from $(10.2)M in FY21
• The continued operational leverage in the business is evidenced
through 118% operating revenue growth compared to 47% for
operating expenses
• Net loan write offs represent 1.2% of the average loan book balance
for FY22, which is well within management expectations
• Interest expense increased 146%, driven by 67% loan origination
growth and 103% loan book growth, along with higher funding costs
• The interest expense represents c. 3.2% of the average loan book
balance for FY22
FY22 ($’000)
FY21 ($’000)
Variance
Revenue
59,392
27,575
Operating expenses
(40,972)
(27,943)
Net loan write offs
(6,852)
(2,227)
Interest expense
(18,754)
(7,614)
Cash EBTDA
(7,186)
(10,209)
118%
47%
208%
146%
30%
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WISR LIMITED • ANNUAL REPORT 2022 27
MODERATE GROWTH
PROFITABILITY TO BE
ACHIEVED WITHIN 12 MONTHS1
Strong and prudent
growth delivered
Prime $780M Loan Book heading to $1B, FY22 operating revenue up
118% on the back of 24 consecutive quarters of loan growth. Growth rate
to be tempered to achieve profitability within 12 months1.
On track to be
profitable within 12
months
On-balance sheet arrears less than 1% (0.98%), decrease in provisioning
over time, with last 7-year focus on prime and super prime credit only,
setting the Company up well to thrive through a change in domestic
economic conditions
Significant opex
reduction delivered
Material reductions in opex, headcount, internal and external spend, and
pausing or exiting fully growth spend initiatives.
Fast levers pulled to
protect margin / NIM
In response to the rising cost of funds, Wisr has increased the front book
weighted average yield by c. 340 bps between April and September
20222. Loan unit economics managed and protected through increased
front book rates, back book hedging, and maintaining prime credit quality
and loss metrics.
Unique strategy to
deliver rewards in
challenging times
Over 647K Australians in proprietary Financial Wellness Platform, reduces
customer acquisition cost, drives loan conversion, improves customer
financial wellbeing and opens up new revenue models.
1 Profitability is on a run-rate Cash EBTDA basis and is subject to broader market conditions, including any significant volatility events, the level of global inflation and interest rates, and
the impact of any geopolitical events.
2 August and September are forecast based on anticipated loan volume, corresponding yield and BBSW
28
WISR LIMITED • ANNUAL REPORT 2022 “We are a growth company and
will continue to be a growth
company for the next decade
or more, but in the short term
we’ve prioritised achieving
profitability within 12 months
over accelerating growth.”
Anthony Nantes
CHIEF EXECUTIVE OFFICER
29
ENVIRONMENT,
SOCIAL AND
GOVERNANCE
Purpose-led companies outperform in long-term
value creation (TSR) because purpose unites
employees and customers – profits and purpose are
inextricably linked1.
Wisr’s purpose guides everything from our business
model, strategy and products to our culture and
behaviours. We exist to improve the financial wellness
of all Australians.
Wisr is proud to have ESG in our DNA and at the
centre of everything we do.
E
S
G
1 Blackrock’s Larry Fink: “Profits,” https://www.linkedin.com/pulse/my-2019-letter-ceos-inextricable-link-between-purpose-larry-fink/
30
WISR LIMITED • ANNUAL REPORT 2022 Carbon neutral
• Climate-positive and carbon-neutral workforce
• Offset 1,517.4 tonnes (including staff WFH footprint) through projects that deliver measurable
benefits aligned with the aims of the Paris Agreement and the UN Sustainable Development
Goals1
• PL and SVL products used for purchase of EVs and second-hand vehicles. PL purpose
includes solar infrastructures (e.g. panels and batteries), and sustainable home renovation
products (e.g. insulation, building materials, appliances, water tanks)
Social opportunity
• Wisr does not have a gender pay gap2
• In April 2020, the Company’s Board set a target to achieve a minimum of 30% female
representation on the Board. The Board’s target was exceeded in March 2022, with 40%
female representation. The Company is above the ASX200 average of 34.6% female
directorships3
• Awarded AFR Best Places to Work 2022 overall, Most Outstanding Practice for Diversity &
Inclusion Award and Winner of the 2022 Fintech Awards, Diversity & Inclusion
Governance
Wisr is held to account through:
• ASX compliance, strong corporate governance and reporting, and risk management framework
• Senior corporate governance advisor to the Board
• Board annually considers governance initiatives to bring the company further into compliance
• Wisr is in compliance with all but one of the ASX Corporate Governance Council’s Recommendations
as detailed in its “Principles and Recommendations” (4th Edition)
1 Through partnership with trace https://www.our-trace.com/our-projects
2 Like-for-like analysis was undertaken on 31 March 2022 WEGA report March 2022
3 https://www.moneymanagement.com.au/news/financial-planning/gender-diversity-lagging-asx-boards#:~:text=The%20ASX%20200%20in%202015,It%20was%20now%20at%20
33.1%25.
31
AWARD-WINNING MOMENTUM
Wisr recognised for great lending, product and employee experience throughout FY22
32
WISR LIMITED • ANNUAL REPORT 2022 33
EXECUTIVE LEADERSHIP TEAM
Anthony Nantes
CHIEF EXECUTIVE OFFICER
At Wisr, Anthony’s proven track record in technology and business innovation has been
recognised through multiple award accolades, including the 2018 Optus MyBusiness
Awards, Business Leader of the Year; 2019 Executive of the Year Awards, Highly
Commended - CEO of the Year; and the 2020 Finnies Awards, Outstanding Fintech Leader
of the Year. In 2021, Wisr was recognised as one of the fastest-growing technology
companies in Australia by the Deloitte Technology Fast 50 Awards, coming in at #21 and
increasing 66 places to #12 in the 2021 AFR Fast 100 List. In 2021, Wisr was placed #8 in
the AFR Best Places to Work as a first-time entrant and then rose to #2 in 2022 and took
out the overall, Most Outstanding Practice for Diversity & Inclusion Award.
Andrew Goodwin
CHIEF FINANCIAL OFFICER
Andrew has a traditional investment banking and private equity background combined with
an entrepreneurial mindset. Andrew spent most of his career at Macquarie Capital, both in
Australia and offshore, advising and participating in transactions totalling over $20 billion
across multiple sectors. Prior to this, Andrew commenced his career at KPMG within
assurance and advisory while also attaining the Chartered Accountant qualification.
Joanne Edwards
CHIEF RISK AND DATA OFFICER
Joanne is a respected leader of multiple disciplines within Banking, with 18+ years of
experience ranging from credit risk, product management, pricing, analytics and strategic
project delivery. Joanne is passionate about using data and analytics to solve business
problems, drive profitable growth, streamline processes and improve customer experience.
Before Wisr, Joanne was General Manager of Unsecured Risk at the Commonwealth Bank,
where she led the integration project for the bank’s Comprehensive Credit Reporting
compliance.
Dr Lili Sussman
CHIEF STRATEGY OFFICER
Lili has diverse international experience across the public, social purpose and corporate
sectors. She has worked with the government, international development organisations,
BCG, and the Commonwealth Bank. Before Wisr, Lili was the Chief Strategy Officer at Social
Ventures. Lili holds a PhD in Political Science from Harvard University and has taught at
Harvard and Yale.
Ben Berger
CHIEF PRODUCT OFFICER
Ben’s 20+ years of experience spans all product life cycle stages, from formulating market
approaches to building and delivering innovative tech-driven solutions for amazing
customer experiences and services. Before Wisr, Ben was Head of Product at THE ICONIC.
34
WISR LIMITED • ANNUAL REPORT 2022 Oliver Bladek
CHIEF OPERATING OFFICER
Oliver is passionate about how technology and high-performing teams can exceed
customer expectations. Before Wisr, Oliver was the Deputy CEO at the National Disability
Insurance Agency, building their digital and service design functions. He supported
Westpac’s agile transformation and spent 15 years at McKinsey and Company. He also led
the firm’s organisation practice in Australia and New Zealand.
James Goodwin
CHIEF MARKETING OFFICER
James is a marketing and communications professional passionate about leading high-
performance teams. At Wisr, he is responsible for delivering Wisr’s purpose-led brand
strategy and customer-first marketing approach. He has over 14 years of experience in
advertising and marketing, with extensive experience in the financial services sector,
working with brands including Bankwest, ING and American Express.
Peter Beaumont
CHIEF COMMERCIAL OFFICER
Peter joined Wisr in 2015 and has led the growth of Wisr’s broker channel. He is a senior
business executive with over 25 years of global banking, finance and project delivery
experience with leading international investment banks Citibank, UBS AG, Bank of America
Merrill Lynch and ABN AMRO. Peter brings to Wisr a broad set of customer acquisition and
sales leadership skills with deep experience operating high-volume, online financial product
businesses.
Kate Renner
HEAD OF EMPLOYEE EXPERIENCE
Kate has over 13 years of experience building people and recruitment programs in the
People and Culture space. Formerly in Silicon Valley, Kate worked on building a global
recruitment program at Salesforce and developed a rich end-to-end employee experience
at tech start-up Inkling. Kate moved to Sydney in 2016 and has built the Wisr Employee
Experience, HR and Recruitment functions from the ground up.
David King
GENERAL COUNSEL
David is a commercial lawyer with 13+ years of experience working in global law firms and
as an in-house lawyer in Australia and London, UK. Before joining Wisr, David worked as
Senior Legal Counsel (APAC) at Endeavor (NYSE: EDR) and advised on legal and business
affairs across Asia-Pacific. David holds a Bachelor of Laws (LLB) and Bachelor of Commerce
(BComm - Finance) from the University of Melbourne.
35
BOARD OF DIRECTORS
John Nantes
EXECUTIVE CHAIRMAN
LLB; B.Comm.; B.A., DFP
Mr Nantes has over 25 years of experience in Financial Services, Private Equity, Tax and
Accounting, Corporate Finance, Capital Markets, and M&A. He is also the Executive
Chairman of Income Asset Management, a leading fintech in Australia, as well as a non-
executive director for Thinxtra, a public non-listed IOT technology company and advises
Adcock Private Equity in a CEO capacity.
Mr Nantes has a strong reputation for building growth businesses especially those reliant on
technology and innovation, having previously also held roles such as; Group Head of WHK/
Crowe Horwath Wealth Management, CEO Prescott Securities, and Executive roles at St
George Bank/ Bank SA and advisory and leadership advisory roles at Colonial State Bank.
Craig Swanger
NON-EXECUTIVE DIRECTOR
BCom (Hons); SIA GD
Mr Swanger has extensive board experience, including Macquarie Bank’s major funds
management entity, Macquarie Investment Management Limited and a total of 15 internal
and external boards since 2003. Since Macquarie, Mr Swanger has invested in and advised
a large portfolio of technology companies across finance, social impact, and health.
More specifically in areas related to Wisr, Mr Swanger was Chairman of 5 of the largest debt
listed investment companies in Australia and New Zealand issued over the past decade, and
more recently worked with Australia’s largest corporate bond and securitisation distribution
specialists and is on the Investment Committee of a large SME direct lending fund.
Cathryn Lyall
NON-EXECUTIVE DIRECTOR
B.A.; M.A
Ms Lyall is a highly experienced senior executive, board member and strategic adviser with
over 34 years of experience across finance, banking, government and fintech in Australia
and the United Kingdom. She is a Partner at Seed Space Venture Capital, the Co-Founder of
not-for-profit Seed Money Australia and of London-based SEIS and EIS discretionary fund,
Seismic Foundry.
Ms Lyall’s extensive experience in the Australian and British Financial Services sectors
includes roles at the Chicago Mercantile Exchange, Nasdaq and the London Stock
Exchange. Most notably, Non-Executive Director Deutsche Bank UK Bank, sitting on the
Bank’s Board Risk Committee (BRC), the Listed Derivatives Risk and Compliance Committee
(LDRCC), and the Nomination Committee as Chair.
36
WISR LIMITED • ANNUAL REPORT 2022 Matt Brown
NON-EXECUTIVE DIRECTOR
B.Comm; LLB
Mr Brown is a highly experienced senior executive, board member, adviser and investor with
over 20 years of experience across investment banking and technology in Australia and the
United States. He is the Founder and Managing Director of independent investment and
corporate advisory firm, Alluvion Capital.
Prior to Alluvion Capital, Mr Brown was Chief Financial Officer and Executive Director of a
high-growth, global enterprise SaaS business. Prior to that, Mr Brown was a Managing
Director at Macquarie Capital, where he spent 12 years in Sydney and New York with a
focus on M&A, capital markets and principal investing.
Mr Brown is also a non-executive director of EncompaaS Software Limited, Thinxtra Limited,
Learning Vault Pty Limited and Upwire Pty Ltd and an active investor in early-stage, high-
growth technology businesses.
Kate Whitney
NON-EXECUTIVE DIRECTOR
B.A.
Ms Whitney is a highly experienced senior executive with over 24 years of experience in
Australian Consumer Law, accelerating growth, product expansion and driving customer
acquisition through data and analytics across advertising, subscription television, FMCG,
financial services, telecommunication, luxury and retail. She is the Chief Marketing and
Growth Officer for the innovative foodservice business, Marley Spoon Australia.
Prior to Marley Spoon, Whitney spent two-and-a-half years as the Director of Digital at
Pernod Ricard in New York, and between 2011 and 2014, she was the General Manager of
Marketing at David Jones. Her key achievements include driving $250M in revenue growth
for David Jones via the Amex Storecard deal and during her tenure at Marley Spoon,
Whitney has seen the company’s revenue more than double.
37
WISR LIMITED • ABN 80 004 661 205
FINANCIAL
REPORT
for the year ended
30 June 2022
38
WISR LIMITED • ANNUAL REPORT 2022 WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
The directors present their report, together with the financial statements, on the consolidated
entity (also referred to hereafter as the Group) consisting of Wisr Limited (referred to hereafter as
the Company or Parent Entity) and the entities it controlled at the end of, or during, the year
ended 30 June 2022.
DIRECTORS
The following persons were directors of the Company during the whole of the financial year and
up to the date of this report, unless otherwise stated:
Name
John Nantes
Position
Chairman
Craig Swanger
Non-Executive Director
Matthew Brown
Non-Executive Director (appointed 13 Sep 2021)
Cathryn Lyall
Non-Executive Director (appointed 1 Jan 2022)
Kate Whitney
Non-Executive Director (appointed 1 April 2022)
Christopher Whitehead
Non-Executive Director (retired 24 Nov 2021)
Particulars of each director’s experience and qualifications are set out later in this report.
PRINCIPAL ACTIVITIES
During the financial year, the Group’s primary activity was writing personal loans and secured
vehicle loans for 3, 5 and 7-year maturities to Australian consumers, and funding these loans
through the warehouse funding structures.
REVIEW OF OPERATIONS
Key Group highlights include:
• Operating revenue up 118% to $59.4M (FY21: $27.2M)
• Total new loan originations up 67% to $611M (FY21: $366M)
• Total loan originations $1.2B as at 30 June 2022
• On-balance sheet portfolio arrears rate 90+ Day arrears of 0.98% at 30 June 2022 (FY21:
0.65%)
• Wholly-owned (on-balance sheet) loan book growth of 103% to $780M (FY21: $384M)
39
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Review of operations (cont.)
• Delivered two consecutive positive operating cash flow quarters (Q2FY22 and Q3FY22)
• 43% increase in the Wisr Financial Wellness Platform (FY22 compared to FY21), with over
647,000 customer profiles as at 30 June 2022 (FY21: 450,000)
• The Company is well capitalised with $71.5M cash balance ($23.3M unrestricted cash) and
$8.2M liquid loan assets available for sale as at 30 June 2022 (FY21: $92.4M cash balance)
• $225M Wisr Secured Vehicle Warehouse (WH2), backed by National Bank Australia (NAB)
and Revolution Asset Management (Revolution), launched in October 2021; increased to
$300M in March 2022 and $400M in July 2022
• An increase in committed funding into the Wisr Warehouse (WH1) from $350M to $450M in
April 2022
• The second ABS transaction for the Company, the $250M Wisr Freedom Trust 2022-1 (made
up of personal loans and), received a AAA Moody’s rating for the top two tranches and a
weighted average margin of 2.23% over one-month BBSW, freeing up $250M capacity in
$450M WH1
• Successful refinancing of WH1 mezzanine investor AOFM by one of Australia’s leading credit
investors, IFM Investors (“IFM”)
• Launch of proprietary credit score Wisr Score in February 2022, optimising Wisr’s customer
risk-adjusted return to enhance profitable market share growth
• Appointment of former Deutsche Bank UK Director Cathryn Lyall to the position of Non-
Executive Director in January 2022
• Appointment of Kate Whitney, Chief Marketing and Growth Officer, Marley Spoon Australia, to
the position of Non-Executive Director in April 2022
• Appointment of Oliver Bladek to Chief Operating Officer in January 2022
SCALING THROUGH A DIFFERENTIATED BUSINESS MODEL
As at 30 June 2022, Wisr delivered an unbroken track record of 24 quarters of prime-credit loan
origination growth, with $1.2B in total loan originations since inception. The year delivered $611M
in new loan originations, a 67% increase on FY21 ($366M).
By attracting high-quality borrowers as customers with an average credit score of 801 (as at 30
June 2022), Wisr’s business model delivered prime, low-risk, profitable and safe growth against a
rising interest rate and inflation environment.
The Company delivered operating revenue of $59.4M, a 118% increase on FY21 ($27.2M) and
demonstrated continued operational leverage with operating expense increasing 47% in
comparison. This also drove positive operating cash flow for Q2FY22 and Q3FY22.
Wisr’s strong balance sheet was strengthened with the $225M WH2 coming into effect in October
2021, supported by NAB as senior funder and Revolution as a mezzanine funder. As part of the
deal, the existing Wisr secured vehicle loan book of circa $127M (with an average yield in Wisr’s
target range of 8-9%) was transferred, creating circa $127M of additional capacity in WH1 to fund
future growth in the personal loan book.
40
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Review of operations (cont.)
In January 2022, the tier-one global institutional fund manager IFM replaced AOFM as the
mezzanine funder in WH1. IFM sits alongside existing mezzanine funder MA Financial Group. The
deal provided significant external validation of Wisr’s business operations, treasury and
underwriting capability and loan book and asset quality.
Committed funding into WH1 increased to $450M in April 2022 by existing senior and mezzanine
investors, and WH2 committed funding increased to $300M in March 2022 and $400M post 30
June 2022 in July 2022.
As at 30 June 2022, Wisr’s wholly-owned loan book (warehouse, securitised and balance sheet)
had a combined loan book balance of $780M, growth of 103% (Q4FY21 $384M).
In June 2022, the Group announced Wisr's second ABS transaction, the $250M Wisr Freedom
Trust 2022-1 (made up of personal loans). The deal received significant support from the debt
market and a AAA Moody’s rating for the top two tranches, with a weighted average margin of
2.23% over one-month BBSW, freeing up $250M capacity in $450M WH1.
Since the inception of warehouse funding facilities in November 2019, Wisr has hedged the
floating component of its cost of funds, the BBSW. Between April and September 2022, the
blended hedged BBSW cost increased by c. 80 bps (forecast). In response, Wisr has increased
the front book weighted average yield by c. 340 bps (forecast) between April and September
20221. Wisr will continue to lift yield and pricing in the market to protect net interest margin and
profitability.
In March 2021, the Group executed a term sheet for an investment in European fintech platform
Arbor. On 5 August 2021, the Group completed its initial investment, consisting of EUR715,358
($1,168,695) in exchange for a 12.5% ownership stake. A fair value assessment was performed at
31 December 2021 with no change proposed. Subsequent to the fair value assessment, during
H2FY22, Arbor planned a funding round for additional capital. The round was ultimately
unsuccessful which included Wisr being unwilling to commit any further material capital,
particularly given the current focus on core operations. Arbor is now in the process of wind down
and Wisr has accordingly written down the original investment value to nil.
RISK AND ARREARS
Wisr wrote prime quality credit during FY22 with on-balance sheet 90+ Day arrears of 0.98% as at
30 June 2022 (Q4FY21: 0.65%). Throughout FY22, Wisr continually reviewed the Company’s
credit decisions to drive organic growth while optimising profitability. With $1.2B in loans now
written since Q1FY17, Wisr has significant customer data to optimise and internalise the
Company’s lending engine and risk-return profile. In February 2022, Wisr launched the proprietary
credit score platform and algorithm, the Wisr Score, to enhance profitable market share growth.
Wisr was well prepared to navigate the rising rate environment and market conditions with early
warning indicators already in place to respond quickly and tighten credit while also investing in
collection processes.
1August and September are forecast based on anticipated loan volume, corresponding yield and BBSW
41
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Review of operations (cont.)
FINANCIAL POSITION, REVENUE AND LOAN BOOK
The Group is well capitalised with $71.5M cash ($23.3M unrestricted cash) and $8.2M liquid loan
assets as at 30 June 2022. The liquid loan assets are sold into the warehouse trusts at regular
intervals and so are relevant to the capital position.
Wisr delivered $59.4M in operating revenue, a 118% increase on FY21 ($27.2M). This was driven
by a 67% growth in loan originations to $611M in FY22 (FY21: $366M).
At 30 June 2022, Wisr had a total loan book of $803M (FY21: $432M) consisting of:
• $780M on-balance sheet (WH1, WH2, Wisr Freedom Trust 2021-1 and Wisr Freedom Trust
2022-1) (FY21: $384M)
• $23M off-balance sheet (FY21: $48M)
AASB 9 requires a forecast of lifetime expected credit losses that uses a three-staged approach
based on the credit profile of the receivable. The total loan impairment expense in FY22 was
$16.4M or 2.1% of gross loan receivables (FY21: $7.9M or 2.1%), representing $6.8M of net losses
and $9.5M of incremental provisions for expected future credit loss.
EXPENSES
The Group continues to experience improvement in operating leverage driven by revenue growth
and expense management, resulting in Wisr’s maiden positive operating cash flow and Cash
EBTDA quarter (Q2FY22). Revenue growth and continued scaling delivered a second consecutive
positive operating cash-flow quarter (Q3FY22).
For FY22, the Group had a Cash EBTDA of $(7.2)M, a 30% improvement on FY21 ($(10.2)M) and
an increase in accounting loss before tax of 13% to $(19.9)M (FY21 $(17.6)M), predominantly
driven by the material non-cash provision for expected credit loss expense of $16.4M (FY21
$7.9M) due to significant growth in loan origination volume and loan book.
Other expense items include:
• An increase in employee benefits and marketing expenses driven by the scaling of the Group,
including through growth investment into the Wisr Financial Wellness Platform and Wisr
brand including the Tokyo Olympics campaign
• An increase in finance costs due to loan origination and loan book growth along with higher
funding costs
WISR FINANCIAL WELLNESS PLATFORM
The Wisr Financial Wellness Platform introduced over 196,000 new customer profiles (43%
increase on FY21), taking the total platform to over 647,000 as at 30 June 2022 and on the path
to 1M customer profiles. Wisr App has now paid down over $4M in mostly high-interest debt for
customers.
42
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Review of operations (cont.)
STAFF AND CULTURE
The Group continues to innovate Wisr’s high-performance culture, delivering an average +86
Employee Engagement score for FY22, and in the 2022 AFR Best Places to Work Awards, rose to
#2 in the Banking, Superannuation & Financial Services category as well as taking out the overall,
Most Outstanding Practice for Diversity & Inclusion Award. The Company was also recognised as
one of the fastest-growing technology companies in Australia by the Deloitte Technology Fast 50
Awards, coming in at #21 and increasing 66 places to #12 in the 2021 AFR Fast 100 List.
OUTLOOK
While remaining cognisant of current market conditions, the Group is focused on delivering both
profitability in the short-term and sustainable long-term profitability. Wisr has the resources and
capability in place to achieve this, including a strong cash-balance sheet, rate and pricing levers
and reductions in operating costs being put in place over the next 12 months. Profitability is on a
run-rate Cash EBTDA basis and is subject to broader market conditions, including any significant
volatility events, the level of global inflation and interest rates, and the impact of any geopolitical
events.
To ensure Wisr protects margin and profitability in a rising rate cycle, the Company lifted front
book yield consistently through Q4FY22 and beyond, and as Wisr predicts further increases in the
cost of funds, the front book yield will continue to lift to protect net interest margin.
The key executive priorities for the next 12 months include:
The focus on near-term profitability
• Significant reduction in short-term growth aspirations in lending in response to the macro
environment
• Front book yield will continue to lift to ensure the Company delivers strong net interest
margin and achieves profitability2
• Cost management with a material reduction in employee expenses and headcount and
external spend
• Pausing all new credit product expansion and/or go-to-market expenditure
• Exited any continued support for Arbor in the EU market, and any short-term growth
ambitions for geographical expansion
• Material overall reduction in investment in the Wisr Financial Wellness Platform
Cost of funds management
• Continue to utilise the multiple levers available to absorb funding cost increases while still
protecting net interest margin, including increasing the front book yield
2 Profitability is on a run-rate Cash EBTDA basis and is subject to broader market conditions, including any significant
volatility events, the level of global inflation and interest rates, and the impact of any geopolitical events.
43
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Review of operations (cont.)
Loan origination growth
• Switching from high to moderate growth and positively impacting Cash EBTDA; accelerated
growth will occur as market conditions allow
Continued focus on credit quality
• The Company is well prepared to navigate market conditions with early warning indicators
already in place to respond quickly and tighten credit while also investing in collection
processes
• Proprietary credit score Wisr Score will optimise Wisr’s customer risk-adjusted return to
enhance profitable market share growth in the current rate environment
Loan book and funding model expansion
• The establishment of additional funding facilities and undertaking further ABS transactions
(subject to market conditions), creating additional funding capacity in WH1 and WH2
• Maintain the Company’s clear credit quality, margin focus and selective approval process to
avoid targeting a higher credit score that can bias the risk of the book and result in lower
margins
• Achieve the near-term target of a $1B loan book, and continue moderate growth towards $3B
Technology investment and feature enhancement
•
Invest further in the technology stack to improve business processes and efficiencies
• Notwithstanding the materially reduced investment, continue Wisr’s cultivation of a
proprietary channel (the Financial Wellness Platform) for differentiation in the consumer
finance space
Operations and People
• There are no changes to the Executive Leadership Team or Management following reduction
in headcount, retaining key IP and talent to maintain culture, diversity and high-performance
outcomes
• Continue to be one of Australia’s best places to work
DIVIDENDS
There were no dividends declared or paid in the financial year.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
There were no significant changes in the state of affairs of the Group during the financial year.
44
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
EVENTS SINCE THE END OF THE FINANCIAL YEAR
There are no significant events to report since the end of the financial year.
ENVIRONMENTAL MATTERS
The Group is not subject to any significant environmental regulations under Australian
Commonwealth or State law.
INDEMNITY AND INSURANCE OF AUDITOR
The Company has not, during or since the end of the financial year, indemnified or agreed to
indemnify the auditor of the company or any related entity against a liability incurred by the
auditor. During the financial year, the company has not paid a premium in respect of a contract to
insure the auditor of the Company or any related entity.
INFORMATION ON DIRECTORS
The names and details of the Company's directors in office during the financial year and until the
date of this report are presented below.
John Nantes, Chairman
Qualifications
Experience
LLB; B.Comm.; B.A., DFP
Mr Nantes has over 25 years of experience in Financial Services, Private
Equity, Tax and Accounting, Corporate Finance, Capital Markets, and M&A. He
is also the Executive Chairman of Income Asset Management, a leading fintech
in Australia, as well as a non-executive director for Thinxtra, a public non-listed
IOT technology company and advises Adcock Private Equity in a CEO capacity.
Mr Nantes has a strong reputation for building growth businesses especially
those reliant on technology and innovation, having previously also held roles
such as; Group Head of WHK/Crowe Horwath Wealth Management, CEO
Prescott Securities, and Executive roles at St George Bank/ Bank SA and
advisory and leadership advisory roles at Colonial State Bank.
Interest in shares and options as at
30 June 2022
Ordinary shares held: 16,081,370
Performance rights held: Nil
Former directorships (last 3 years)
None
Other current directorships
Income Asset Management Group Ltd (ASX: IAM)
1st Group Ltd (ASX: 1ST)
45
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Craig Swanger, Non-Executive Director
Qualifications
Experience
BCom (Hons); SIA GD
Mr Swanger has extensive board experience, including Macquarie Bank’s major
funds management entity, Macquarie Investment Management Limited and a
total of 15 internal and external boards since 2003. Since Macquarie, Mr
Swanger has invested in and advised a large portfolio of technology companies
across finance, social impact, and health.
More specifically in areas related to Wisr, Mr Swanger was Chairman of 5 of the
largest debt listed investment companies in Australia and New Zealand issued
over the past decade, and more recently worked with Australia’s largest
corporate bond and securitisation distribution specialists and is on the
Investment Committee of a large SME direct lending fund.
Interest in shares and options as at
30 June 2022
Ordinary shares held: 5,866,666
Performance rights held: Nil
Former directorships (last 3 years)
None
Other current directorships
Income Asset Management Group Ltd (ASX: IAM)
Matthew Brown, Non-Executive Director (appointed 13 Sep 2021)
Qualifications
Experience
B.Comm; LLB
Mr Brown is a highly experienced senior executive, board member, adviser and
investor with over 20 years of experience across investment banking and
technology in Australia and the United States. He is the Founder and Managing
Director of independent investment and corporate advisory firm, Alluvion
Capital.
Prior to Alluvion Capital, Mr Brown was Chief Financial Officer and Executive
Director of a high-growth, global enterprise SaaS business. Prior to that, Mr
Brown was a Managing Director at Macquarie Capital, where he spent 12 years
in Sydney and New York with a focus on M&A, capital markets and principal
investing.
Mr Brown is also a non-executive director of EncompaaS Software Limited,
Thinxtra Limited, Learning Vault Pty Limited and Upwire Pty Ltd and an active
investor in early-stage, high-growth technology businesses.
Interest in shares and options as at
30 June 2022
Ordinary shares held: 475,000
Performance rights held: 1,937,000
Former directorships (last 3 years)
None
Other current directorships
None
46
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Cathryn Lyall, Non-Executive Director (appointed 1 Jan 2022)
Qualifications
Experience
B.A.; M.A
Ms Lyall is a highly experienced senior executive, board member and strategic
adviser with over 34 years of experience across finance, banking, government
and fintech in Australia and the United Kingdom. She is a Partner at Seed
Space Venture Capital, the Co-Founder of not-for-profit Seed Money Australia
and of London-based SEIS and EIS discretionary fund, Seismic Foundry.
Ms Lyall’s extensive experience in the Australian and British Financial Services
sectors includes roles at the Chicago Mercantile Exchange, Nasdaq and the
London Stock Exchange. Most notably, Non-Executive Director Deutsche Bank
UK Bank, sitting on the Bank’s Board Risk Committee (BRC), the Listed
Derivatives Risk and Compliance Committee (LDRCC), and the Nomination
Committee as Chair.
Interest in shares and options as at
30 June 2022
Ordinary shares held: Nil
Performance rights held: Nil
Former directorships (last 3 years)
None
Other current directorships
None
Kate Whitney, Non-Executive Director (appointed 1 April 2022)
Qualifications
Experience
B.A.
Ms Whitney is a highly experienced senior executive with over 24 years of
experience in Australian Consumer Law, accelerating growth, product
expansion and driving customer acquisition through data and analytics across
advertising, subscription television, FMCG, financial services,
telecommunication, luxury and retail. She is the Chief Marketing and Growth
Officer for the innovative foodservice business, Marley Spoon Australia.
Prior to Marley Spoon, Whitney spent two-and-a-half years as the Director of
Digital at Pernod Ricard in New York, and between 2011 and 2014, she was the
General Manager of Marketing at David Jones. Her key achievements include
driving $250M in revenue growth for David Jones via the Amex Storecard deal
and during her tenure at Marley Spoon, Whitney has seen the company’s
revenue more than double.
Interest in shares and options as at
30 June 2022
Ordinary shares held: Nil
Performance rights held: Nil
Former directorships (last 3 years)
None
Other current directorships
None
47
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Christopher Whitehead, Non-Executive Director (retired on 24 Nov 2021)
Qualifications
Experience
Chartered Banker BSc, F FIN, FAICD
Mr Whitehead has over 30 years’ experience in financial services and
technology, across a wide range of roles. He is currently the Managing Director
and CEO of FINSIA, Australia’s leading professional body in financial services.
He was formally CEO of Credit Union Australia from 2009 to 2015, Regional
Director at the Bank of Scotland from 2007 to 2008 and Chief Executive Retail
Banking at BankWest from 2001 to 2007.
Prior to this he was CIO at BankWest and Advance Bank. He worked in the IT
sector for 15 years, including leading a successful start-up and in marketing
and technical roles for a global technology provider.
Mr Whitehead has previously served as non-executive director for Cuscal
Limited, St Andrews Insurance Group and a number of other financial services,
technology and community organisations.
Interest in shares and options as at
30 June 2022
Ordinary shares held: 7,430,000
Performance rights held: Nil
Former directorships (last 3 years)
None
Other current directorships
None
INFORMATION ON COMPANY SECRETARIES
Vanessa is a highly experienced governance professional, having held
leadership and executive management roles in companies listed on ASX, TSX,
Nasdaq and JSE over the past fifteen years. She obtained degrees in law and
commerce and then practised as an attorney for twelve years before entering
the corporate world.
Vanessa has acted as company secretary to a range of companies listed on
ASX and TSX and brings with her a wealth of experience in governance
management, board advisory, corporate structuring and capital raising in the
listed company space. She currently acts as company secretary and
governance advisor to four companies listed on ASX.
Miss Ho holds a Bachelor of Laws and Bachelor of Business (Accounting Major)
degree and has completed a Graduate Diploma in Applied Corporate
Governance.
She is currently also Financial Controller of the Group.
Miss Ho has also had over 3 years’ experience practicing as a solicitor in a
private law firm in Sydney.
Vanessa Chidrawi
Experience
May Ho
Experience
48
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
INDEMNIFICATION AND INSURANCE OF OFFICERS AND AUDITORS
The Group has entered into agreements with the following to indemnify them against liabilities
incurred in their capacity as an officer/director of the Group to the extent permitted by law:
•
John Nantes
• Craig Swanger
• Matthew Brown
• Cathryn Lyall
•
Kate Whitney
• Christopher Whitehead
• Vanessa Chidrawi
•
•
Peter Beaumont
Stephen Porges
• Campbell McComb
•
Leanne Ralph
During the financial year, the Group incurred a premium to insure the directors and officers of the
Group. Disclosure of the nature of the liabilities covered and the amount of the premium payable
is prohibited by the insurance contract.
The Group has not otherwise, during or since the end of the financial year, except to the extent
permitted by law indemnified or agreed to indemnify an officer or auditor of the company or any
of its controlled entities against a liability incurred as such an officer or auditor.
MEETINGS OF DIRECTORS
The number of meetings of the Company’s Board of Directors and of each board committee held
during the year ended 30 June 2022, and the number of meetings attended by each director
were:
Directors' Meetings
Risk Management Committee
Meetings*
Remuneration and Nominations
Meetings
Number
eligible to
attend
Number
attended
Number
eligible to
attend
Number
attended
Number
eligible to
attend
Number
attended
John Nantes
Craig
Swanger
Matthew
Brown
Cathryn Lyall
Kate
Whitney
Christopher
Whitehead
12
12
10
6
3
4
12
12
10
6
3
4
2
-
-
-
-
2
2
-
-
-
-
2
-
6
3
-
1
4
* Effective 1 July 2022, the Risk Management Committee is now the Audit and Risk Committee
-
6
3
-
1
4
PROCEEDINGS ON BEHALF OF THE COMPANY
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.
49
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
NON-AUDIT SERVICES
BDO Audit Pty Ltd were appointed Company auditor on 25 September 2020 and will continue in
office in accordance with section 327 of the Corporations Act 2001. The Company may decide to
engage the auditor on assignments additional to their statutory audit duties where the auditor’s
expertise and experience with the Group are important.
The following fees were paid or payable to BDO for non-audit services provided during the year
ended 30 June 2022:
Non-audit services
Taxation services
Accounting advice
Total
$
34,102
2,000
36,102
The directors are satisfied that the provision of non-audit services during the financial year, by the
auditor (or by another person or firm on the auditor's behalf), is compatible with the general
standard of independence for auditors imposed by the Corporations Act 2001.
The directors are of the opinion that the services as disclosed in note 19 to the financial statements
do not compromise the external auditor's independence requirements of the Corporations Act 2001
for the following reasons:
• all non-audit services have been reviewed and approved to ensure that they do not impact the
integrity and objectivity of the auditor; and
• none of the services undermine the general principles relating to auditor independence as set
out in APES 110 Code of Ethics for Professional Accountants issued by the Accounting
Professional and Ethical Standards Board, including reviewing or auditing the auditor's own
work, acting in a management or decision-making capacity for the company, acting as
advocate for the company or jointly sharing economic risks and rewards.
AUDITOR'S INDEPENDENCE DECLARATION
The auditor's independence declaration in accordance with section 307C of the Corporations Act
2001 For the year ended 30 June 2022 has been received and can be found within the financial
report.
50
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
PERFORMANCE RIGHTS
At the date of this report, the unissued ordinary shares of Wisr Limited under performance rights
are as follows:
Effective Grant Date
Date of Expiry
Exercise Price
Number under
Performance Rights
19 Feb 2019
1 Sept 2019
1 Sep 2019
1 Jul 2020
1 Jul 2020
1 Jul 2021
1 Jul 2021
31 Jul 2021
31 Jul 2022
30 Jun 2022
31 Jul 2022
31 Jul 2023
31 Jul 2023
31 Jul 2024
24 Nov 2021
30 Nov 2024
Total
Nil
Nil
Nil
Nil
Nil
Nil
Nil
Nil
440,530
8,636,371
5,130,000
5,407,833
5,407,861
4,994,050
4,994,096
1,937,000
36,947,741
Performance rights holders do not have any rights to participate in any issues of shares or other
interests of the Company or any other entity.
There have been no performance rights granted over unissued shares or interests of any
controlled entity within the Group during or since the end of the reporting period.
For details of performance rights issued to directors and executives as remuneration, refer to the
remuneration report.
CORPORATE GOVERNANCE STATEMENT
Our Corporate Governance Statement is available on our website at: www.wisr.com.au/policies-
and-governance
51
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
REMUNERATION REPORT
LETTER FROM CHAIRPERSON OF THE REMUNERATION AND NOMINATIONS COMMITTEE
Dear Shareholders,
On behalf of the Board, I am pleased to present Wisr’s Remuneration Report (Report) for the financial year
ended 30 June 2022 (FY22).
This report outlines Wisr’s remuneration strategy set by the Board in 2019 and executed over the past 36
months. Wisr’s remuneration framework, as outlined in the accompanying Report, reflects our commitment
to deliver competitive remuneration for outstanding performance in order to attract and retain talented
individuals, while aligning the interests of executives and shareholders. Most importantly in FY20, FY21 and
FY22 cash conservation was and continues to be the key to protect shareholder value and avoid
unnecessary dilution.
As such, performance-based non-cash remuneration forms a significant portion of Wisr’s remuneration
strategy. This approach is used for KMPs, directors and senior management, and the KPIs and behaviours
required to qualify for awards are linked all the way through the organisation, aligning values, behaviours and
shareholder-interests.
When it comes to KMPs and directors in particular, Wisr’s strategy involves recipients receiving significantly
less fixed (cash) remuneration than their market value. The trade-off for them is that they receive equity-
based incentives that could take their total remuneration to more than their market value.
This is an “executives win only if shareholders win” remuneration strategy targeted at entrepreneurial leaders
that will back themselves to deliver for shareholders. If long-term shareholder returns don’t perform at 15%
p.a. at least, total remuneration will be well below market as it will be limited to fixed cash remuneration and
potentially STI where applicable. If they exceed 15% p.a. but less than 30% p.a., total remuneration will be in
line with market for the same individuals; and if returns reach 200% or more over the three year period, total
remuneration will be above market.
Similarly, and unlike the remuneration approach of many ASX-listed companies, equity-based incentives also
require minimum service and behaviour standards.
The total value of these packages has been benchmarked to relevant peers on the ASX in terms of fixed
(cash) remuneration components and maximum remuneration. The share price triggers were set in
consultation with KMPs, with the team collectively choosing shareholder return triggers well above those
typically used by peers on the ASX, allowing us greater alignment of interests while managing the cost of the
total packages.
Regarding STI, each year the Board will assess several factors including the quality of the results, adherence
to risk management policies, achievement against individual objectives and the effectiveness of strategic
initiatives implemented to determine the extent to which the overall outcomes adequately reflect actual
performance and returns to shareholders.
This Report is structured to provide shareholders with insights into the remuneration governance, policies,
procedures and practices being applied. Remuneration is a complex topic, particularly when equity-based
incentives are included. We trust that should you have any questions about the rationale for our approach or
any of the details, that you will let us know.
...............................................................
CRAIG SWANGER
CHAIRPERSON, REMUNERATION AND NOMINATIONS COMMITTEE
52
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED)
Wisr Limited’s 2022 remuneration report sets out remuneration information for the Company’s
directors and other key management personnel.
The report contains the following sections:
1. Key management personnel disclosed in this report
2. Remuneration governance
3. Service agreements
4. Details of remuneration
5. Equity instruments held by key management personnel
6. Movement in performance rights
7. Fair value of performance rights
1. KEY MANAGEMENT PERSONNEL DISCLOSED IN THIS REPORT
The key management personnel are those persons having authority and responsibility for
planning, directing and controlling the major activities of the Group, directly or indirectly, including
any director (whether executive or otherwise) of the Parent Entity.
During the year ended 30 June 2022 and up to the date of this report, the following were
classified as key management personnel:
Name
John Nantes
Position
Chairman
Craig Swanger
Non-Executive Director
Matthew Brown
Non-Executive Director (appointed 13 Sep 2021)
Cathryn Lyall
Kate Whitney
Non-Executive Director (appointed 1 Jan 2022)
Non-Executive Director (appointed 1 Apr 2022)
Chris Whitehead
Non-Executive Director (retired on 24 Nov 2021)
Anthony Nantes
Chief Executive Officer
Andrew Goodwin
Chief Financial Officer
2. REMUNERATION GOVERNANCE
The Board ensures that executive reward satisfies the following key criteria for good reward
governance practices:
• competitiveness and reasonableness;
• acceptability to shareholders;
• performance linkage and alignment of executive compensation;
•
transparency; and
• capital management.
53
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Remuneration report (audited) | 2. Remuneration governance (cont.)
a. Our remuneration framework
Wisr’s remuneration strategy is approved by the Board. A Remuneration and Nominations
Committee (RNC) was established on 26 June 2020. The role of the RNC is set out in its charter,
which is reviewed annually.
Wisr Remuneration Framework (2019 – 2022)
Objectives
Attract, motivate
and retain
executive talent
required to deliver
strategy
Appropriately
balance fixed and
at-risk components
Create reward
differentiation to
drive performance
values and
behaviours
Create shareholder
value through
equity alignment
Remuneration
Component
Total Remuneration
(TR)
Total Fixed
Remuneration (TFR)
Variable Cash
Remuneration (STI)
Variable Equity
Remuneration (LTI)
Amount and Range
(Min Rem – Max
Rem)
Min Rem 2nd–3rd
quartile level for
WZR current size
Conditions to
exceed Min
Strategy behind
this approach
Max Rem at 2nd–3rd
quartile at WZR
market cap if LTI
hurdles achieved
(38.00 cents per
share by 2022).
Must pass all
compliance KPIs to
exceed Min Rem. In
order to reach Max
Rem, individual STI
hurdles must be
exceeded each year,
share price hurdles
of up to 200%
growth over 3 years
must be passed, and
tenure must be at
least 3 years.
WZR’s strategy
requires executives
with experience well
beyond what WZR
can afford in cash
rem. Further there
are no guarantees of
success, so the
framework relies
heavily upon at-risk
components.
TFR set according to
similar positions at
ASX companies of
WZR size today.
This will result in
fixed (cash) rem
being at market if
executives do not
grow the Company
in line with the
strategy, but well
under market if they
do.
n/a
0-50% depending
upon position. None
for directors. Can
be taken as equity at
executive’s option
with 10% discount to
reflect premium on
cash.
LTI to form 40-70%
of TR.
100% of LTI is at-
risk, meaning that
the minimum LTI
payment is nil for all
executives.
Must pass all
compliance KPIs to
exceed nil, then
performance driven
according to
individual but
aligned KPIs.
All LTI linked to
share price
increases of 15%-
200% from the share
price of 12.51c at the
time of issue (2019).
LTI also requires min
service and
compliance KPIs to
be satisfied.
Conserve cash and
therefore minimise
shareholder dilution.
Align behaviour in
short-term, including
risk management
and revenue growth,
while conserving
cash.
Align executives to
manage all aspects
required for
shareholder growth
including earnings
growth, compliance
and attracting
shareholders.
In accordance with best practice corporate governance, the structure of non-executive director
and executive remuneration is separate and distinct.
b. Remuneration Structures for non-executive directors
Non-executive director remuneration was designed to attract and retain directors of the highest
calibre, whilst incurring a cost which is acceptable to shareholders.
54
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Remuneration report (audited) | 2. Remuneration governance (cont.)
The Constitution and the ASX Listing Rules specify that the aggregate remuneration of
non-executive directors shall be determined from time to time by a general meeting. An amount
not exceeding the amount determined is then divided between the directors as agreed. The latest
determination was adopted by ordinary resolution passed at the Annual General Meeting held on
24 November 2021 when shareholders approved an increase of the maximum aggregate amount
of non-executive director remuneration to $1,000,000 per annum, excluding share-based
payments such as performance rights.
The aggregate remuneration is reviewed annually. The remuneration for non-executive directors
is currently comprised of cash, superannuation contributions and performance rights.
Retirement allowances for non-executive directors
There is no scheme to provide retirement benefits, other than statutory superannuation, to
non-executive directors.
c. Remuneration Structures for current executives
The remuneration aspects for current executives aims to reward executives with a level and mix
of remuneration commensurate with the position and responsibilities within the Company and so
as to:
• align the interests of executives with those of the shareholder; and
• ensure total remuneration is competitive by market standards in order to attract and retain
talented individuals.
i. Fixed remuneration
The level of fixed remuneration for executives is set so as to provide a base level of remuneration
which is both appropriate to the position and is competitive in the market. Executives receive
fixed remuneration by way of salary and company superannuation payments.
ii. At-risk remuneration
Wisr’s performance hurdles, particularly for the LTI, are at the higher end of the market (ASX peer
companies) in terms of degree of difficulty. Any STI and LTI award will only have value to the
executive if the performance hurdles are met to enable vesting to occur, and for performance
rights related awards, if the share price on vesting exceeds the trigger price.
In the event of serious misconduct or a material misstatement in the company’s financial
statements, the RNC can cancel or defer performance-based remuneration and may also claw
back performance-based remuneration paid in previous financial years.
In addition, all executives above have entered into a voluntary escrow agreement in which they
have agreed to retain all remuneration-related equity for their full tenure (other than as required to
cover any income tax liabilities relating to this equity). This was not a condition of the LTI Plan,
but agreed collectively by the executives.
55
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Remuneration report (audited) | 2. Remuneration governance (cont.)
iii. Retirement benefits
No executives have entered into employment agreements that provide additional retirement
benefits.
d. Company performance linked to remuneration
Given the growth nature of the Company, the lack of profit and other key financial variables as
shown in the table below, the award of LTI are made on the basis of each individual’s contribution
to their specific role in the Company to date and their expected importance to the future of the
Company. LTI were deemed to provide an appropriate performance incentive for each individual
as applicable.
30 June 2022
30 June 2021
30 June 2020
30 June 2019
30 June 2018
$
$
$
$
$
Operating revenue
59.392M
27.231M
7.166M
3.043M
1.591M
Loss
Dividend
(19.905M)
(17.639M)
(23.535M)
(7.731M)
(6.208M)
nil
nil
nil
nil
nil
Cash balance
71.489M
92.410M
37.973M
11.993M
1.549M
Share price
$0.07
$0.26
$0.22
$0.15
$0.02
56
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Remuneration report (audited) (cont.)
3. SERVICE AGREEMENTS
The remuneration agreements of key management personnel as at 30 June 2022 are set out
below:
KMP
Position held as at 30
June 2022 and any
change during the year
Contract details (duration and
termination)
J Nantes
Chairman
C Swanger
Non-executive director
M Brown
Non-executive director
C Lyall
Non-executive director
K Whitney
Non-executive director
No determined duration – subject to
retirement and re-election rules of the
Company’s constitution.
No notice required to terminate.
No determined duration – subject to
retirement and re-election rules of the
Company’s constitution.
No notice required to terminate.
No determined duration – subject to
retirement and re-election rules of the
Company’s constitution.
No notice required to terminate.
No determined duration – subject to
retirement and re-election rules of the
Company’s constitution.
No notice required to terminate.
No determined duration – subject to
retirement and re-election rules of the
Company’s constitution.
No notice required to terminate.
Agreed gross cash salary
per annum incl.
superannuation ($)
100,000
60,000
60,000
88,000
88,000
A Nantes
Chief Executive Officer
No fixed term.
6 months’ notice to terminate.
A Goodwin
Chief Financial Officer
No fixed term.
6 months’ notice to terminate.
573,568
(base cash salary per
service agreement)
423,568
(base cash salary per
service agreement)
In addition to salary based compensation, the following key management personnel have been
granted performance rights to align their compensation with the performance of the Company, as
reflected in its share price. Performance rights are granted in tranches and are linked to share
prices over designated periods, as per the following table:
57
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Remuneration report (audited) | 3. Service agreements (cont.)
KMP
M Brown
A Nantes
A Goodwin
VWAP share price
target *
No. performance
rights that will vest
Earliest
determination date
for vesting
Date performance
rights lapse if
conditions not met
$0.3060
$0.3530
$0.4050
$0.7980
$0.3000
$0.3000
360,000
452,000
544,000
581,000
3,500,000
1,630,000
24 Nov 2021
30 Nov 2024
30 Nov 2022
30 Nov 2024
30 Nov 2023
30 Nov 2024
24 Nov 2021
30 Nov 2024
1 Sep 2019
30 Jun 2022
1 Sep 2019
30 Jun 2022
* These Performance Rights will automatically vest and exercise for nil consideration on satisfaction of the Vesting
Conditions.
The Vesting Conditions for the Performance Rights are:
•
•
The holder being a director/employee of the Company as at the relevant vesting determination dates specified
in the table; and
The relevant volume weighted average price (VWAP) of the Company’s ordinary shares traded on ASX over
any 20-day period exceeds the prices specified in the table.
4. DETAILS OF REMUNERATION
The following table of benefits and payment details, in respect to the financial year, represents
the components of remuneration for each member of the key management personnel of the
Group:
SHORT TERM BENEFITS
POST
EMPLOYMENT
BENEFITS
LONG-
TERM
BENEFITS
SHARE BASED
PAYMENTS
Cash salary,
fees & short-
term
compensated
absences
Short-term
incentive
schemes
($)
Superannuation
($)
Long
service
leave
($)
Performance
Rights
($)
Shares
($)
Directors (2022)
J Nantes
110,000
C Swanger
54,795
M Brown
48,000
C Lyall
40,000
K Whitney
20,000
C Whitehead
22,831
Total:
295,626
Executives (2022)
-
-
-
-
-
-
-
-
5,479
-
4,000
2,000
2,283
13,762
-
-
-
-
-
-
-
A Nantes
441,667
98,941
23,568
15,876
A Goodwin
354,167
66,941
23,568
8,677
Total:
795,834
165,882
47,136
24,553
89
49
150,338
-
-
49
150,525
309
133
442
-
-
-
-
-
-
-
-
-
-
Total
($)
Performance
Related (%)
110,089
60,323
0.08
0.08
198,338
75.80
44,000
22,000
-
-
25,163
0.20
459,913
580,361
453,486
1,033,847
17.10
14.79
58
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Remuneration report (audited) | 4. Details of remuneration (cont.)
SHORT TERM BENEFITS
POST
EMPLOYMENT
BENEFITS
LONG-
TERM
BENEFITS
SHARE BASED
PAYMENTS
Cash salary,
fees & short-
term
compensated
absences
Short-term
incentive
schemes
($)
Superannuation
($)
Long
service
leave
($)
Performance
Rights
($)
Shares
($)
Total
($)
Performance
Related (%)
Directors (2021)
J Nantes
106,887
C Swanger
54,795
C Whitehead
54,795
Total:
216,477
Executives (2021)
-
-
-
-
1,446
5,205
5,205
11,856
-
-
-
-
33,152
18,418
18,418
69,988
A Nantes
290,000
94,830
28,960
3,593
115,178
A Goodwin
290,000
64,218
27,572
3,281
49,596
Total:
580,000
159,048
56,532
6,874
164,774
-
-
-
-
-
-
-
141,485
23.43
78,418
78,418
298,321
532,561
434,667
967,228
23.49
23.49
37.65
25.74
Further details of performance-related remuneration paid or accrued for FY2022 in respect of
specific key management personnel are discussed below:
• Mr A Nantes
Mr Nantes is eligible to receive a short-term incentive (STI) of up to $50,000 in respect of
each six-month period, subject to the achievement of key performance indicators as agreed
by the Board of Directors from time to time, assessed in the sole discretion of the Board and
paid following the Board’s approval of the Company’s audited accounts for the relevant
period.
• Mr A Goodwin
Mr Goodwin is eligible to receive an STI of up to $34,000 in respect of each six-month
period, subject to the achievement of key performance indicators as agreed by the Board of
Directors from time to time, assessed in the sole discretion of the Board.
Short-term and long-term incentives established in the year for the above KMPs are also set out
in Note 23 of the financial report.
Performance conditions set for KMP short-term and long-term incentives (as discussed above
and in Note 23 of the financial report) align the KMP interests with the outcomes for shareholders,
customers, and staff. The achievement of these performance conditions support the growth of
company value whilst providing KMPs with remuneration packages that are above market rates
relative to peer roles. Conversely, an underperformance of goals expose KMPs to a level of
financial risk where their remuneration packages become well below market rates.
59
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Remuneration report (audited) (cont.)
5. EQUITY INSTRUMENTS HELD BY KEY MANAGEMENT PERSONNEL
The table below shows the number of ordinary shares in the Company held by key management
personnel.
Balance at the
start of the year
Received as
compensation
Received on exercise
of options or rights
Other changes
during the year
Balance at end
of the year
Directors (2022)
J Nantes
C Swanger
M Brown
C Lyall
K Whitney
13,201,370
4,091,666
350,000
-
-
C Whitehead
5,830,000
Total:
23,473,036
Executives (2022)
A Nantes
47,258,736
-
-
-
-
-
-
-
-
2,880,000
-
16,081,370
1,600,000
175,000
5,866,666
-
-
-
1,600,000
125,000
475,000
-
-
-
-
-
7,430,000
6,080,000
300,000
29,853,036
A Goodwin
21,808,903
3,333,334
4,300,000
Total:
69,067,639
3,333,334
14,310,000
10,010,000
-
-
-
57,268,736
29,442,237
86,710,973
Directors (2021)
J Nantes
10,767,015
C Swanger
4,693,619
C Whitehead
4,450,000
Total:
19,910,634
2,390,000
44,355
13,201,370
1,430,000
(2,031,953)
4,091,666
1,330,000
50,000
5,830,000
5,150,000
(1,937,598)
23,123,036
-
-
-
-
-
39,108,736
8,150,000
12,871,491
5,037,412
3,900,000
51,980,227
5,037,412
12,050,000
-
-
-
47,258,736
21,808,903
69,067,639
Executives (2021)
A Nantes
A Goodwin
Total:
60
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Remuneration report (audited) (cont.)
6. MOVEMENT IN PERFORMANCE RIGHTS
The table below provides the number of performance rights held by Key Management Personnel
at 30 June 2021 and 30 June 2022.
Rights held as at
30 June 2021
Rights granted
during FY22
Rights exercised
during FY22
Rights lapsed
during FY22
Rights held as at
30 June 2022
Name
Directors
J Nantes
C Swanger
M Brown
C Lyall
K Whitney
5,960,000
3,310,000
-
-
-
-
-
1,937,000
-
-
-
2,880,000
3,080,000
1,600,000
1,710,000
-
-
-
-
-
-
1,600,000
1,710,000
-
-
1,937,000
-
-
-
C Whitehead
3,310,000
Total:
12,580,000
1,937,000-
6,080,000
6,500,000-
1,937,000
Executives
A Nantes
18,510,000
A Goodwin
8,260,000
Total:
26,770,000
7. FAIR VALUE OF PERFORMANCE RIGHTS
-
-
-
10,010,000
8,500,000
4,300,000
3,960,000
14,310,000
12,460,000
-
-
-
PERFORMANCE RIGHTS GRANTED
VESTING CONDITIONS
Number
Effective
grant date
Fair Value per
right at
effective grant
date ($)
Earliest vesting
determination
date
VWAP Share
Price
condition ($)
Expiry date
360,000
24 Nov 2021
0.24582
24 Nov 2021
0.3060
30 Nov 2024
452,000
24 Nov 2021
0.08146
30 Nov 2022
0.3530
30 Nov 2024
544,000
24 Nov 2021
0.04712
30 Nov 2023
0.4050
30 Nov 2024
581,000
24 Nov 2021
0.05614
24 Nov 2021
0.7980
30 Nov 2024
Directors (2022)
M Brown
M Brown
M Brown
M Brown
Executives (2022)
A Nantes
3,500,000
1 Sep 2019
0.03926
1 Sep 2019
$0.3000
30 Jun 2022
A Goodwin
1,630,000
1 Sep 2019
0.03926
1 Sep 2019
$0.3000
30 Jun 2022
These Performance Rights will automatically vest and exercise for nil consideration on satisfaction of the Vesting Conditions.
The Vesting Conditions for the Performance Rights are:
•
•
The holder being a director/employee of the Company as at the relevant vesting determination dates specified in the
table; and
The relevant volume weighted average price (VWAP) of the Company’s ordinary shares traded on ASX over any 20-day
period exceeds the prices specified in the table.
61
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ REPORT
For the year ended 30 June 2022
Remuneration report (audited) (cont.)
The total fair value of above rights at grant date issued to key management personnel is
$183,563. The value of rights differs to the expense recognised as part of each key management
person’s remuneration in table d) above because this value is the grant date fair value calculated
in accordance with AASB 2 Share Based Payment whereby the expense is recognised throughout
the vesting period.
This concludes the remuneration report, which has been audited.
This report is made in accordance with a resolution of directors.
...............................................................
JOHN NANTES
DIRECTOR
Sydney
30 August 2022
62
WISR LIMITED • ANNUAL REPORT 2022
AUDITOR’S INDEPENDENCE DECLARATION
63
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
For the year ended 30 June 2022
Revenue
Other income
Expenses
Employee benefits expense
Marketing expense
Customer processing costs
Property expenses
Other expenses
Finance costs
Depreciation and amortisation expense
Loss on investments
Provision for expected credit loss expense
Share based payment expense
Loss before income tax
Income tax expense
Loss after income tax for the year
Loss for the year is attributable to:
Owners of Wisr Limited
Earnings per share for loss attributable to the owners of Wisr Limited
Basic earnings per share
Diluted earnings per share
Other comprehensive income
Note
2
3
2022
$
2021
$
59,392,199
27,230,985
31
344,188
(18,926,195)
(14,191,169)
(12,089,987)
(6,264,211)
(3,688,843)
(3,067,701)
(69,473)
(187,949)
(6,197,511)
(4,232,284)
(18,753,814)
(7,614,021)
(931,461)
(541,922)
(1,168,695)
-
(16,352,472)
(7,934,680)
(1,118,686)
(1,180,559)
(19,904,907)
(17,639,323)
-
-
(19,904,907)
(17,639,323)
(19,904,907)
(17,639,323)
Cents
(1.48)
(1.48)
Cents
(1.60)
(1.60)
4
4
31
6
30
18
27
27
Gain arising from changes in fair value of cash flow hedging
instruments entered into
16
24,300,420
795,948
Other comprehensive income for the year, net of tax
24,300,420
795,948
Total comprehensive income (loss) for the year
4,395,513
(16,843,375)
Total comprehensive income (loss) for the year is attributable to:
Owners of Wisr Limited
4,395,513
(16,843,375)
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with
the accompanying notes.
64
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2022
ASSETS
Cash and cash equivalents
Trade and other receivables
Loan receivables
Property, plant and equipment
Other assets
Right of use assets
Derivative financial instruments
Intangible assets
Total assets
LIABILITIES
Trade and other payables
Provision for employee benefits
Lease liability
Borrowings
Total liabilities
Net assets
EQUITY
Issued capital
Reserves
Accumulated losses
Total equity
Note
2022
$
2021
$
5
7
6
8
12
14
9
10
11
12
13
15
16
16
71,489,070
92,409,558
1,065,176
1,208,633
764,838,727
374,651,379
487,866
263,471
1,562,249
521,759
1,037,746
1,729,578
24,856,717
264,050
2,736,735
384,544
868,074,286
471,432,972
5,435,693
3,945,333
1,307,554
872,215
1,203,052
1,886,648
782,282,354
392,472,477
790,228,653
399,176,673
77,845,633
72,256,299
144,477,325
143,678,390
27,906,702
3,250,454
(94,538,394)
(74,672,545)
77,845,633
72,256,299
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
65
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2022
Issued
capital
$
Reserves
$
Accumulated
losses
$
Total equity
$
Balance at 1 Jul 2020
89,827,317
3,181,186
(57,037,262)
35,971,241
Loss after income tax expense for the year
Other comprehensive gain for the year, net of tax
Total comprehensive gain / (loss) for the year
Transactions with owners in their capacity as
owners:
-
-
-
-
(17,639,323)
(17,639,323)
795,948
-
795,948
795,948
(17,639,323)
(16,843,375)
Issue of share capital
Costs of raising capital
54,999,914
(3,160,131)
-
-
Share based payment expense (Note 16)
-
1,180,559
Transfer of share based reserve to issued capital
on exercise of options
1,835,713
(1,835,713)
Issue of shares as a result of exercise of options
for consideration
145,577
(37,486)
Issue of shares for services rendered
30,000
(30,000)
-
-
-
-
-
-
Transfer of share-based payment reserve
-
(4,040)
4,040
54,999,914
(3,160,131)
1,180,559
-
108,091
-
-
Balance at 30 Jun 2021
143,678,390
3,250,454
(74,672,545)
72,256,299
Balance at 1 Jul 2021
143,678,390
3,250,454
(74,672,545)
72,256,299
Loss after income tax expense for the year
Other comprehensive gain for the year, net of tax
Total comprehensive gain / (loss) for the year
Transactions with owners in their capacity as
owners:
-
-
-
-
(19,904,907)
(19,904,907)
24,300,420
-
24,300,420
24,300,420
(19,904,907)
4,395,513
Costs of raising capital
(64,062)
-
Share based payments (Note 16)
-
1,257,883
Transfer of share-based reserve to issued capital
on exercise of options
818,997
(818,997)
Issue of shares for services rendered
44,000
(44,000)
-
-
-
-
Transfer of share-based payment reserve
-
(39,058)
39,058
(64,062)
1,257,883
-
-
-
Balance at 30 Jun 2022
144,477,325
27,906,702
(94,538,394)
77,845,633
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
66
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 30 June 2022
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Payments to suppliers and employees
Interest received on investments and cash
Management fees received
Note
2022
$
2021
$
56,963,941
24,305,699
(43,012,102)
(27,595,351)
13,951,839
(3,289,652)
19,473
11,285
643,750
1,176,790
Interest and other finance costs paid
(17,473,304)
(6,261,893)
Proceeds from R&D tax incentive
280,164
380,874
Net cash used in operating activities
26
(2,578,078)
(7,982,596)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for plant and equipment
(371,751)
(308,875)
Payment for investments
Transfer for term deposit
Payment for technology assets
Net movement in customer loans
(1,168,695)
(561,629)
(2,297,136)
-
-
-
(401,956,547)
(294,052,383)
Net cash used in investing activities
(406,355,758)
(294,361,258)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Proceeds from exercise of share options
Costs of raising capital paid
Repayment of borrowings – secured notes
-
-
54,999,914
108,091
(148,183)
(3,076,009)
-
(1,675,000)
Proceeds from issuance of borrowings
390,614,465
309,325,000
Transaction costs related to borrowings
(1,769,338)
(2,552,511)
Payments for right of use asset
(683,596)
(349,339)
Net cash provided by financing activities
388,013,348
356,780,146
Net (decrease) / increase in cash and cash equivalents
(20,920,488)
54,436,292
Cash and cash equivalents at the beginning of the financial year
92,409,558
37,973,266
Cash and cash equivalents at the end of the financial year
71,489,070
92,409,558
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
67
WISR LIMITED • ANNUAL REPORT 2022
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
The consolidated financial statements of Wisr Limited (the Group) For the year ended 30 June
2022 was authorised for issue in accordance with a resolution of the directors on 30 August 2022.
The directors have the power to amend and revise the financial report.
The consolidated financial statements and notes represent those of Wisr Limited and its
controlled entities (the Group).
Wisr Limited is a company limited by shares incorporated and domiciled in Australia whose shares
are publicly traded on the Australian Stock Exchange (ASX).
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1.1 Basis of preparation
These general purpose consolidated financial statements have been prepared in accordance with
the Corporations Act 2001, Australian Accounting Standards and Interpretations of the Australian
Accounting Standards Board and in compliance with International Financial Reporting Standards
as issued by the International Accounting Standards Board. The Group is a for-profit entity for
financial reporting purposes under Australian Accounting Standards. Material accounting policies
adopted in the preparation of these financial statements are presented below and have been
consistently applied unless stated otherwise.
Except for cash flow information, the financial statements have been prepared on an accrual basis
and are based on historical costs, modified, where applicable, by the measurement at fair value of
selected non-current assets, financial assets and financial liabilities.
The statement of financial position is presented on a liquidity basis. Assets and liabilities are
presented in decreasing order of liquidity and do not distinguish between current and non-
current. All balances are expected to be recovered within 12 months except for intangible assets,
property, plant and equipment and financial instruments, for which expected term is disclosed.
Where required by Accounting Standards and/or for improved presentation purposes,
comparative figures have been adjusted to conform with changes in presentation for the current
year.
a. Going concern
These financial statements have been prepared under a going concern basis.
The Directors believe that the Group will have sufficient resources to pay its debts and meet its
commitments for at least the next 12 months from the date of this financial report due to the
Group having:
•
strong cash reserves; and
• wholesale funding arrangements for future loan originations;
both of which support its operational commitments.
68
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 1. Summary of significant accounting policies (cont.)
b. New and revised accounting standards and interpretations
The Group has adopted all of the new, revised or amending Accounting Standards and
Interpretations issued by the Australian Accounting Standards Board (AASB) that are mandatory
for the current reporting period.
Any new, revised or amending Accounting Standards or Interpretations that are not yet
mandatory have not been early adopted.
1.2 Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of the Company and
all subsidiaries as at 30 June 2022, and the results of all subsidiaries for the year then ended.
Subsidiaries are all those entities over which the Company has the power to govern the financial
and operating policies, generally accompanying a shareholding of 100% of the voting rights. The
existence and effect of potential voting rights that are currently exercisable or convertible are
considered when assessing whether the Company controls another entity.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group.
They are de-consolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between Group
companies are eliminated. Unrealised losses are also eliminated unless the transaction provides
evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have
been changed where necessary to ensure consistency with the policies adopted by the Group.
Investments in subsidiaries are accounted for at cost in the individual financial statements of the
Company, less any impairment charges.
1.3 Foreign currency transactions and balances
a. Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the
currency of the primary economic environment in which the entity operates (the functional
currency). The consolidated financial statements are presented in Australian dollars ($), which is
Wisr Limited’s functional and presentation currency.
Foreign currency transactions are translated into the functional currency using the exchange rates
prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at year end exchange rates of monetary
assets and liabilities denominated in foreign currencies are recognised through profit or loss,
except when deferred in equity as qualifying cash flow hedges and qualifying net investment
hedges.
1.4
Impairment of assets
Assets are tested for impairment whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable, and as a minimum, annually. An impairment loss is
recognised for the amount by which the asset's carrying amount exceeds its recoverable amount.
69
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 1. Summary of significant accounting policies | 1.4 Impairment of assets (cont.)
The recoverable amount is the higher of an asset's fair value less costs to sell and value in use.
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there
are separately identifiable cash inflows which are largely independent of the cash inflows from
other assets or groups of assets (cash-generating units). Non-financial assets, other than
goodwill, that suffered an impairment are reviewed for possible reversal of the impairment at the
end of each reporting period.
1.5
Investments and other financial assets
Investments and other financial assets are initially measured at fair value. Transaction costs are
included as part of the initial measurement, except for financial assets at fair value through profit
or loss. Such assets are subsequently measured at either amortised cost or fair value depending
on their classification. Classification is determined based on both the business model within which
such assets are held and the contractual cash flow characteristics of the financial asset unless, an
accounting mismatch is being avoided.
Financial assets are derecognised when the rights to receive cash flows have expired or have
been transferred and the Group has transferred substantially all the risks and rewards of
ownership. When there is no reasonable expectation of recovering part or all of a financial asset,
it's carrying value is written off.
a. Financial assets at fair value through profit or loss
Financial assets not measured at amortised cost or at fair value through other comprehensive
income are classified as financial assets at fair value through profit or loss. Typically, such
financial assets will be either: (i) held for trading, where they are acquired for the purpose of
selling in the short-term with an intention of making a profit, or a derivative; or (ii) designated as
such upon initial recognition where permitted. Fair value movements are recognised in profit or
loss.
b.
Impairment of financial assets
The consolidated entity recognises a loss allowance for expected credit losses on financial assets
which are either measured at amortised cost or fair value through other comprehensive income.
The measurement of the loss allowance depends upon the consolidated entity's assessment at
the end of each reporting period as to whether the financial instrument's credit risk has increased
significantly since initial recognition, based on reasonable and supportable information that is
available, without undue cost or effort to obtain.
Where there has not been a significant increase in exposure to credit risk since initial recognition,
a 12-month expected credit loss allowance is estimated. This represents a portion of the asset's
lifetime expected credit losses that is attributable to a default event that is possible within the
next 12 months. Where a financial asset has become credit impaired or where it is determined that
credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected
credit losses. The amount of expected credit loss recognised is measured on the basis of the
probability weighted present value of anticipated cash shortfalls over the life of the instrument
discounted at the original effective interest rate.
70
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 1. Summary of significant accounting policies | 1.5 Investments and other financial assets (cont.)
For financial assets measured at fair value through other comprehensive income, the loss
allowance is recognised within other comprehensive income. In all other cases, the loss allowance
is recognised in profit or loss.
1.6 Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the
amount of GST incurred is not recoverable from the Australian Taxation Office. In these
circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of
an item of the expense. Receivables and payables in the statement of financial position are shown
inclusive of GST. The net amount of GST recoverable from, or payable to, the taxation authority is
included with other receivables or payables in the statement of financial position.
1.7 Critical accounting estimates and judgements
The Directors evaluate estimates and judgments incorporated into the financial statements based
on historical knowledge and best available current information. Estimates assume a reasonable
expectation of future events and are based on current trends and economic data, obtained both
externally and within the Group.
Allowance for expected credit losses
The allowance for expected credit losses assessment requires a degree of estimation and
judgement. It is based on the lifetime expected credit loss, grouped based on days overdue, and
makes assumptions to allocate an overall expected credit loss rate for each group. These
assumptions include historical collection rates.
Coronavirus (COVID-19) pandemic
Judgement has been exercised in considering the impacts that the Coronavirus (COVID-19)
pandemic has had, or may have, on the Group based on known information. This consideration
extends to the nature of the products and services offered, customers, staffing and geographic
regions in which the Group operates. Other than as addressed in specific notes, there does not
currently appear to be either any significant impact upon the financial statements or any
significant uncertainties with respect to events or conditions which may impact the Group
unfavourably as at the reporting date or subsequently as a result of the Coronavirus (COVID-19)
pandemic.
1.8 Fair value measurements
The Group measures some of its assets and liabilities at fair value on either a recurring or non-
recurring basis, depending on the requirements of the applicable Accounting Standard.
Fair value is the price the Group would receive to sell an asset or would have to pay to transfer a
liability in an orderly (ie 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
71
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 1. Summary of significant accounting policies | 1.8 Fair value measurements (cont.)
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 (ie 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 (ie 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).
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.
The Group measures and recognises the following assets and liabilities at fair value on a recurring
basis after initial recognition:
• Financial assets at fair value through profit & loss (investment); and
• Derivative financial instruments at fair value asset or (liability). Hedging ineffectiveness being
recognised through profit & loss.
a. 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.
b. 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
72
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 1. Summary of significant accounting policies | 1.8 Fair value measurements (cont.)
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.
Interest rate swap contracts are valued using a discounted cash flow approach. Future cash flows
are estimated based on observable forward interest rates and discounted based on applicable
yield curves at the reporting date, taking into consideration the credit risk of the Group and
various counterparties. These are deemed to be level 2 inputs as related to both quoted prices
and observable inputs to the asset or liability.
1.9 Hedge accounting
The Group designates interest rate swaps as hedging instruments as cash flow hedges.
At the inception of the hedge relationship, the Group documents the relationship between the
hedging instrument and the hedged item, along with its risk management objectives and its
strategy for undertaking hedge transactions. Furthermore, at the inception of the hedge and on
an ongoing basis, the Group documents whether the hedging instrument is effective in offsetting
changes in cash flows of the hedged item attributable to the hedged risk, which is when the
hedging relationships meet all of the following hedge effectiveness requirements:
•
•
•
there is an economic relationship between the hedged item and the hedging instrument;
the effect of credit risk does not dominate the value changes that result from that economic
relationship; and
the hedge ratio of the hedging relationship is the same as that resulting from the quantity of
the hedged item that the Group actually hedges and the quantity of the hedging instrument
that the Group actually uses to hedge that quantity of hedged item.
If a hedging relationship ceases to meet the hedge effectiveness requirement relating to the
hedge ratio but the risk management objective for that designated hedging relationship remains
the same, the Group adjusts the hedge ratio of the hedging relationship (i.e. rebalances the
hedge) so that it meets the qualifying criteria again.
73
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 1. Summary of significant accounting policies | 1.9 Hedge accounting (cont.)
a. Cash flow hedges
The effective portion of changes in the fair value of derivatives and other qualifying hedging
instruments that are designated and qualify as cash flow hedges is recognised in other
comprehensive income and accumulated under the heading of cash flow hedging reserve, limited
to the cumulative change in fair value of the hedged item from inception of the hedge. The gain or
loss relating to the ineffective portion is recognised immediately in profit or loss, and is included in
the ‘other gains and losses’ line item.
Amounts previously recognised in other comprehensive income and accumulated in equity are
reclassified to profit or loss in the periods when the hedged item affects profit or loss, in the same
line as the recognised hedged item.
The Group discontinues hedge accounting only when the hedging relationship (or a part thereof)
ceases to meet the qualifying criteria (after rebalancing, if applicable). This includes instances
when the hedging instrument expires or is sold, terminated or exercised. The discontinuation is
accounted for prospectively. Any gain or loss recognised in other comprehensive income and
accumulated in cash flow hedge reserve at that time remains in equity and is reclassified to profit
or loss when the forecast transaction occurs.
Movements in the hedging reserve in equity are detailed in note 16.
74
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
NOTE 2. REVENUE
Interest income on financial assets
Interest income on financial assets
Effective interest income on financial assets
Other revenue from financial assets
Interest on cash
Total income from financial assets
Revenue from contracts with customers
Management fees
Total revenue from contracts with customers
Total revenue
DISAGGREGATION OF REVENUE
CONSOLIDATED
2022
$
2021
$
58,235,149
25,586,055
357,152
19,473
170,806
11,285
58,611,774
25,768,146
780,425
1,462,839
780,425
1,462,839
59,392,199
27,230,985
The above provides a breakdown of revenue by major revenue stream. The categories above
depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by
economic data. As disclosed in the directors’ report, the Group has one operating segment.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the
entity and the revenue can be reliably measured. The following specific recognition criteria must
also be met before revenue is recognised:
2.1
Interest income on financial assets
a.
Interest income
Interest revenue is recognised as interest accrues using the effective interest method. This is a
method of calculating the amortised cost of a financial asset and allocating the interest income
over the relevant period using the effective interest rate, which is the rate that exactly discounts
estimated future cash receipts through the expected life of the financial asset to the net carrying
amount of the financial asset.
b. Loan establishment fees
Loan establishment fees are deferred and recognised as an adjustment to the effective interest
rate as these fees are an integral part of generating an involvement with the resulting financial
instrument.
2.2 Revenue from contracts with customers
Management fees
Management fees are earned through the contracts with funders (customers) which entitle the
consolidated entity to fees as a result of satisfying the performance obligation, being the monthly
management of the associated loan portfolio. Revenue is recognised on an over-time basis. The
allocation of the transaction price is calculated as a percentage of the loan balance managed by
the consolidated entity on a monthly basis, being the satisfaction of the performance obligation.
75
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 2. Revenue (cont.)
Revenue is recognised at an amount that reflects the consideration to which the consolidated
entity is expected to be entitled in exchange for transferring services to a customer.
The consolidated entity invoice on a monthly basis which aligns to the recognition criteria noted
above and as a result, there is no recognition of contract assets or liabilities required.
NOTE 3. OTHER INCOME
R&D and other tax incentives
Gain on loan purchase
Other income
CONSOLIDATED
2022
$
-
31
31
2021
$
330,133
14,055
344,188
Government grants revenue is recognised at fair value when there is reasonable assurance that
the grant will be received and the grant conditions will be met.
NOTE 4. EXPENSES
Profit/(loss) before income tax from continuing operations includes the following
specific expenses:
Depreciation
Leasehold improvements
Plant and equipment
Right-of-use assets
Total depreciation
Amortisation
Technology assets
Total amortisation
CONSOLIDATED
2022
$
2021
$
101,567
53,922
604,660
760,149
36,889
14,248
403,568
454,705
171,312
171,312
87,216
87,216
Total depreciation and amortisation
931,461
541,921
Finance costs
Interest and finance charges paid/payable on borrowings
Interest and finance charges paid/payable on lease liabilities
Finance costs expensed
Cash flow hedge ineffectiveness
Cash flow hedge ineffectiveness
18,669,112
7,542,939
84,702
71,082
18,753,814
7,614,021
(292,247)
306,769
76
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 4. Expenses (cont.)
Superannuation expense
Superannuation expense
Share-based payments expense
Share-based payments expense
NOTE 5. CASH AND CASH EQUIVALENTS
Cash at bank
Restricted cash
Total
CONSOLIDATED
2022
$
2021
$
1,348,494
993,922
1,118,686
1,180,559
CONSOLIDATED
2022
$
2021
$
23,339,472
64,756,642
48,149,598
27,652,916
71,489,070
92,409,558
Reconciliation to cash and cash equivalents at the end of the financial year
The above figures are reconciled to cash and cash equivalents at the end of the financial year as
shown in the statement of cash flows as follows:
Balance as above
Balance as per statement of cash flows
71,489,070
92,409,558
71,489,070
92,409,558
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short
term highly liquid investments with original maturities of three months or less, bank overdrafts,
and restricted cash.
Restricted cash is held by the Wisr Warehouse and is utilised for loan funding and not available to
pay creditors of other entities within the Group.
NOTE 6. LOAN RECEIVABLES
A financial asset shall be measured at amortised cost if it is held within a business model whose
objective is to hold assets in order to collect contractual cash flows which arise on specified dates
and that are solely principal and interest. A debt investment shall be measured at fair value
through other comprehensive income if it is held within a business model whose objective is to
both hold assets in order to collect contractual cash flows which arise on specified dates that are
solely principal and interest as well as selling the asset on the basis of its fair value. All other
financial assets are classified and measured at fair value through profit or loss unless the entity
makes an irrevocable election on initial recognition to present gains and losses on equity
instruments (that are not held-for-trading or contingent consideration recognised in a business
combination) in other comprehensive income (‘OCI’). Despite these requirements, a financial asset
may be irrevocably designated as measured at fair value through profit or loss to reduce the
effect of, or eliminate, an accounting mismatch.
77
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 6. Loan receivables (cont.)
6.1
Impairment of financial assets
The Group recognises a loss allowance for ECL on financial assets which are either measured at
amortised cost or fair value through other comprehensive income. The measurement of the loss
allowance depends upon the Group’s assessment at the end of each reporting period as to
whether the financial instrument's credit risk has increased significantly since initial recognition,
based on reasonable and supportable information that is available, without undue cost or effort to
obtain.
The Group has adopted a three-stage model for ECL provisioning:
Stage 1: 12 months ECL
Where there has not been a significant increase in exposure to credit risk since initial recognition,
a 12-month ECL allowance is estimated. This represents a portion of the loan receivable lifetime
ECL that is attributable to a default event that is possible within the next 12 months. Effective
interest is calculated on the gross carrying amount of the loan receivable.
Stage 2: Lifetime ECL – not credit impaired
Where a loan receivable credit risk has increased significantly since initial recognition, but is not
credit impaired, the loss allowance is based on the loan receivable lifetime ECL. For these loan
receivables, the Group recognises as a collective provision a lifetime ECL (i.e. reflecting the
remaining term of the loans receivable). Effective interest is calculated on the gross carrying
amount of the financial instrument.
Stage 3: Lifetime ECL – credit impaired
Where there is objective evidence that the loan receivable has become credit impaired, the loss
allowance is based on the loan receivable lifetime ECL. Effective interest is calculated on the net
carrying amount of the financial instrument.
For financial assets measured at fair value through other comprehensive income, the loss
allowance is recognised within other comprehensive income. In all other cases, the loss allowance
is recognised in profit or loss.
6.2 Allowance for expected credit losses
The Group has historically adopted an off-balance sheet loan funding model which resulted in
relatively low loan receivables on balance sheet. With the Wisr Warehouse Trusts going live from
mid-November 2019, loan receivables on the balance sheet have increased significantly.
The ECL analysis was performed on five distinct loan receivable books:
• Book 1 – Wisr Warehouse Trust No. 1 - 95% Stage 1
• Book 2 – Wisr Freedom Trust 2021-1 - 96% Stage 1
• Book 3 – Wisr Warehouse Trust No. 2 - 98% Stage 1
• Book 4 – Wisr Freedom Trust 2022-1 - 99% Stage 1
78
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 6. Loan receivables | 6.2 Allowance for expected credit losses (cont.)
• Book 5 – Wisr Finance - 92% Stage 1. This book consists of seasoned, mostly legacy loan
receivables which didn’t qualify for sale to funding partners.
Credit loss refers to the instance whereby a counterparty defaults on its contractual obligations
resulting in financial loss to the group. Default is defined as loan receivables which are at least 90
days past due. A significant increase in credit risk is defined as loan receivables which are at least
30 days past due.
The Group calculates ECL using three main components, the exposure at default (EAD), the
probability of default (PD) and the loss given default (LGD).
The EAD represents the total value the Group is exposed to when the loan receivable defaults.
The 12-month ECL is calculated by multiplying the 12-month EAD, PD and LGD. Lifetime ECL is
calculated using the lifetime PD instead.
The 12-month and lifetime PDs represent the probability of default occurring over the next 12
months and the remaining maturity of the loan receivable respectively. The LGD represents the
unrecovered portion of the EAD taking into account any applicable recovery of the loan
receivable.
The Group originates loan receivables of 3, 5, and 7 year maturities to Australian consumers.
These loans are retained to maturity within the Wisr Warehouse Trust No. 1, Wisr Warehouse Trust
No. 2, Wisr Freedom Trust 2021-1 and Wisr Freedom Trust 2022-1.
The allowance for ECL assessment requires a degree of estimation and judgement. It is based on
12-month and lifetime ECL, grouped based on risk score determined at date of origination and
days overdue, and makes assumptions to allocate an overall ECL for each group. These
assumptions include the Group loan book performance history, existing economic and market
conditions.
Scenario analysis and forward-looking macroeconomic assessments were not incorporated as a
result of the following factors:
• Since February 2022 the Group implemented a proprietary scoring model for cut-off setting
and pricing. Since this time, we have seen higher average credit scores and a reduction in
early arrears rates, as these cohort become a greater proportion of back book we expect
improvement in arrears performance overtime
• Change in mix, we are still seeing a shift toward a high proportion of SVL on our book, which
have higher average scores and lower arrears rates
•
Investment in arrears management processes (e.g. Collections) in systems, processes, and
people, expected to improve arrears and ECL performance overtime
• Regarding economic factors within consumer finance lending, both underemployment and
unemployment are correlated with arrears, however RBA interest rate increases and inflation
have less of a direct correlation to arrears performance. Therefore, given the low
unemployment rate which is expected to stay low throughout FY23 no economic adjustments
have been applied to the ECL position
•
Industry expectations (e.g. via the Risk Managers Round Table) have a similar arrears outlook
to us, which is that unemployment rate will remain at record low levels and therefore
delinquency will stay low for at least the next 6-9 months
79
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 6. Loan receivables | 6.2 Allowance for expected credit losses (cont.)
It was also noted that further scenario analysis and macroeconomic forecasting would result in
undue cost and effort.
Gross loan receivables
Less provision for expected credit loss
CONSOLIDATED
2022
$
2021
$
783,778,935
384,091,403
(18,940,208)
(9,440,024)
764,838,727
374,651,379
The following tables summarise gross carrying amount of loan receivables and provision for
expected credit loss by stages:
Gross loan receivables
12-month (Stage 1)
Lifetime (Stage 2 & 3)
Total gross carrying amount
Less provision for expected credit loss
12 month expected credit loss
Lifetime expected credit loss
Total provision for expected credit loss
CONSOLIDATED
2022
$
2021
$
765,300,635
376,868,793
18,478,300
7,222,610
783,778,935
384,091,403
9,303,174
5,413,601
9,637,034
4,026,423
18,940,208
9,440,024
Net balance sheet carrying value
764,838,727
374,651,379
Expected credit loss per gross loan receivables
12-month (Stage 1)
Lifetime (Stage 2 & 3)
Total expected credit loss per total gross loan receivables
%
1.22
52.15
2.42
%
1.44
55.75
2.46
Reconciliation of total provision for expected credit loss
Balance at 1 July
$
$
9,440,024
3,731,932
Expected credit loss expense recognised during the year to profit or loss
16,352,472
7,934,680
Receivables written-off during the year
Recoveries during the year
Balance at 30 June
(8,017,523)
(2,377,963)
1,165,235
151,375
18,940,208
9,440,024
80
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
NOTE 7. TRADE AND OTHER RECEIVABLES
Expected to be settled within 12 months
Accrued management fee income
R&D tax incentive receivable
Total
CONSOLIDATED
2022
$
2021
$
1,065,176
-
928,501
280,132
1,065,176
1,208,633
Trade receivables are initially recognised at fair value and subsequently measured at amortised
cost using the effective interest method, less any allowance for expected credit losses. Trade
receivables are generally due for settlement within 30 days.
The consolidated entity has applied the simplified approach to measuring expected credit losses
for trade and other receivables, which uses a lifetime expected loss allowance. To measure the
expected credit losses, trade receivables have been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit
losses.
NOTE 8. OTHER ASSETS
Expected to be settled within 12 months
Prepayments
Deposits
Cash held in trust
Not expected to be settled within 12 months
Term deposit
Total
NOTE 9. INTANGIBLE ASSETS
Technology assets:
Cost
Accumulated amortisation
Net carrying amount
Technology assets under development:
Cost
Accumulated amortisation
Net carrying amount
Total intangible assets
CONSOLIDATED
2022
$
887,419
79,219
33,982
2021
$
381,772
43,098
96,889
561,629
-
1,562,249
521,759
CONSOLIDATED
2022
$
2021
$
609,239
609,240
(408,736)
(237,424)
200,503
371,816
2,536,232
12,728
-
-
2,536,232
12,728
2,736,735
384,544
81
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 9. Intangible assets (cont.)
Technology assets are recognised at cost of acquisition. They have a finite life and are carried at
cost less any accumulated amortisation and any impairment losses. Technology assets are
amortised over their useful lives ranging from 2 to 5 years on a straight-line basis.
Development costs are charged to the statement of profit of loss and other comprehensive
income as incurred, or deferred where it is probable that sufficient future benefits will be derived
so as to recover those deferred costs.
The recoverable amount of the group’s intangible assets have been tested for impairment via a
value-in-use calculation using a discounted cash flow model, based on discounted projected
cashflows derived by the cash generating unit over the useful life of the assets. The cash
generating unit was identified as being related to the operating cashflows earned via the Wisr
App, being derived via account maintenance fees and loan referral income and is related to the
intangible assets noted above. No impairment has been identified (2021: no impairment).
The Company continues to invest in growth and innovation. During the reporting period, an
additional amount of $2,523,504 was capitalised (via a combination of cash and non-cash items
relating to the development of the product) given the expectation of future benefit to be derived.
The capitalised cost relates to a non-lending based financial wellness aligned technology product.
NOTE 10. TRADE AND OTHER PAYABLES
Expected to be settled within 12 months
Trade payables
Sundry payables
Accrued expenses
Superannuation payable
Total
CONSOLIDATED
2022
$
2021
$
2,428,912
2,043,859
451,666
597,994
2,075,948
1,031,724
479,167
271,756
5,435,693
3,945,333
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. The fair value of
the trade and other payables is considered to approximate their carrying value.
82
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
NOTE 11. EMPLOYEE BENEFITS
Expected to be settled within 12 months
Provision for annual leave
Not expected to be settled within 12 months
Provision for long service leave
Total employee benefits
CONSOLIDATED
2022
$
2021
$
1,141,538
754,409
166,016
1,307,554
117,806
872,215
Provision is made for the Group’s obligation for employee benefits arising from services rendered
by employees to the end of the reporting period. Short term employee benefits are benefits (other
than termination benefits and equity compensation benefits) that are expected to be settled
wholly within 12 months after the end of the annual reporting period in which the employees
render the related service, including wages, salaries and personal leave. Short term employee
benefits are measured at the (undiscounted) amounts expected to be paid when the obligation is
settled, plus any related costs. Long-term employee benefits are subjected to discounting and
actuarial valuations.
NOTE 12. LEASES
The Group has a property lease which commenced in December 2020 with a 3 year and 1 month
term.
The Group also had two non-cancellable property leases which expired in September 2020 at
which point became month on month agreements.
AASB 16 related amounts recognised in the statement of financial position:
Right of use assets
Leased property
Accumulated depreciation
Net right of use asset
Lease liabilities
Lease liabilities – expected to be settled within 12 months
Lease liabilities – not expected to be settled within 12 months
AASB 16 related amounts recognised in the statement of profit or loss
Depreciation charge related to right of use assets
Interest expense on lease liabilities
Government levies
Short-term lease expense prior to entering into above lease arrangement
2022
$
2021
$
2,133,146
2,133,146
(1,095,400)
(403,568)
1,037,746
1,729,578
770,716
684,336
432,336
1,202,312
1,203,052
1,886,648
2022
$
2021
$
604,660
403,568
84,702
69,473
71,082
31,758
-
143,357
758,835
649,765
12.1 Right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset
is measured at cost, which comprises the initial amount of the lease liability, adjusted for, as
83
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 12. Leases (cont.)
applicable, any lease payments made at or before the commencement date net of any lease
incentives received, any initial direct costs incurred, and, except where included in the cost of
inventories, an estimate of costs expected to be incurred for dismantling and removing the
underlying asset, and restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the
lease or the estimated useful life of the asset, whichever is the shorter. Where the consolidated
entity expects to obtain ownership of the leased asset at the end of the lease term, the
depreciation is over its estimated useful life. Right-of use assets are subject to impairment or
adjusted for any remeasurement of lease liabilities.
The consolidated entity has elected not to recognise a right-of-use asset and corresponding
lease liability for short-term leases with terms of 12 months or less and leases of low-value
assets. Lease payments on these assets are expensed to profit or loss as incurred.
12.2 Lease liabilities
A lease liability is recognised at the commencement date of a lease. The lease liability is initially
recognised at the present value of the lease payments to be made over the term of the lease,
discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined,
the consolidated entity’s incremental borrowing rate. Lease payments comprise of fixed payments
less any lease incentives receivable, variable lease payments that depend on an index or a rate,
amounts expected to be paid under residual value guarantees, exercise price of a purchase option
when the exercise of the option is reasonably certain to occur, and any anticipated termination
penalties. The variable lease payments that do not depend on an index or a rate are expensed in
the period in which they are incurred.
Lease liabilities are measured at amortised cost using the effective interest method. The carrying
amounts are remeasured if there is a change in the following: future lease payments arising from a
change in an index or a rate used; residual guarantee; lease term; certainty of a purchase option
and termination penalties. When a lease liability is remeasured, an adjustment is made to the
corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use
asset is fully written down.
12.3 Critical accounting judgements, estimates and assumptions
a. Lease term
The lease term is a significant component in the measurement of both the right-of-use asset and
lease liability. Judgement is exercised in determining whether there is reasonable certainty that an
option to extend the lease or purchase the underlying asset will be exercised, or an option to
terminate the lease will not be exercised, when ascertaining the periods to be included in the
lease term. In determining the lease term, all facts and circumstances that create an economical
incentive to exercise an extension option, or not to exercise a termination option, are considered
at the lease commencement date. Factors considered may include the importance of the asset to
the Group's operations; comparison of terms and conditions to prevailing market rates; incurrence
of significant penalties; existence of significant leasehold improvements; and the costs and
disruption to replace the asset. The Group reassesses whether it is reasonably certain to exercise
84
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 12. Leases (cont.)
an extension option, or not exercise a termination option, if there is a significant event or
significant change in circumstances.
b. Lease make good provision
A provision has been made for the present value of anticipated costs for future restoration of
leased premises. The provision includes future cost estimates associated with closure of the
premises. The calculation of this provision requires assumptions such as application of closure
dates and cost estimates. The provision recognised for each site is periodically reviewed and
updated based on the facts and circumstances available at the time. Changes to the estimated
future costs for sites are recognised in the statement of financial position by adjusting the asset
and the provision. Reductions in the provision that exceed the carrying amount of the asset will be
recognised in profit or loss.
c.
Incremental borrowing rate
An incremental borrowing rate of 6% (2021: 6%) is used as an estimate of the market borrowing
rate.
NOTE 13. BORROWINGS
Unsecured facility
Wisr Warehouse funding
Less transaction costs
Total borrowings
13.1 Unsecured facility
CONSOLIDATED
2022
$
2021
$
6,500,000
6,500,000
779,868,954
388,841,736
(4,086,600)
(2,869,259)
782,282,354 392,472,477
As at 30 June 2022, the Group has drawn $6.5M of its $6.5M (2021: $21.5M) unsecured loan
facility with a 9.5% p.a. coupon and maturity in May 2023.
13.2 Wisr Warehouse funding
Wisr Warehouse funding are the facilities of Wisr Warehouse Trust No. 1, Wisr Freedom Trust
2021-1, Wisr Warehouse Trust No. 2, and Wisr Freedom Trust 2022-1. These facilities fund loan
receivables for 3, 5 and 7 year maturities.
At 30 June 2022, Wisr Warehouse Trust No. 1 had $450M (30 Jun 2021: $361.5M) in committed
financing, $143.2M (2021: $174.6M) of which has been utilised. The facility is secured against the
underlying pool of loan receivables with no credit recourse back to the consolidated entity. Wisr
Warehouse Trust No. 1 consists of four classes of notes with Wisr the holder of the Class 4 note.
The availability period of the facility is until November 2022. The all in cost of funds for the Wisr
Warehouse Trust No. 1 is circa 3.5% per annum.
85
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 13. Borrowings (cont.)
Wisr Freedom Trust 2021-1 Trust represents the inaugural securitisation for the Group with a
balance of $122.3M (amortising loan book) as at 30 June 2022 (2021: $204.7M) and day one
weighted average margin of circa 1.5% + 1 month BBSW.
Wisr Warehouse No. 2 is a Secured Vehicle Warehouse of $300M of which $275.4M has been
utilised. The facility has a drawn cost of funds of circa 2.3% over BBSW, maturity in October 2022
and is secured against the receivables it funds.
Wisr Freedom Trust 2022-1 represents the second securitisation for the Group with a balance of
$229M (amortising loan book) with a weighted average margin of 2.23% over 1 month BBSW.
The Unsecured facility and Wisr Warehouse borrowings are initially recognised at the fair value of
the consideration received, net of transaction costs. It is subsequently measured at amortised
cost using the effective interest method.
NOTE 14. DERIVATIVE FINANCIAL INSTRUMENTS
Derivative financial instruments
CONSOLIDATED
2022
$
2021
$
24,856,717
264,050
The Group enters into derivative financial instruments (interest rate swaps) to manage its
exposure to interest rate risk.
Derivatives are recognised initially at fair value at the date a derivative contract is entered into
and are subsequently remeasured to their fair value at each reporting date. The resulting gain or
loss is recognised in profit or loss immediately unless the derivative is designated and effective as
a hedging instrument, in which event the timing of the recognition in profit or loss depends on the
nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset whereas a derivative with a
negative fair value is recognised as a financial liability. Derivatives are not offset in the financial
statements unless the Group has both legal right and intention to offset. Other derivatives are
presented as current assets or current liabilities.
Interest swap contracts are categorised as Level 2 financial instruments as they are valued using
observable forward interest rates.
86
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
NOTE 15. ISSUED CAPITAL
15.1
Issued and paid up capital
Ordinary shares fully paid
Costs of raising capital
CONSOLIDATED
2022
$
2021
$
150,025,772
149,162,775
(5,548,447)
(5,484,385)
144,477,325
143,678,390
Ordinary shares participate in dividends and the proceeds on winding up the Company. At
shareholder meetings, each ordinary share is entitled to one vote when a poll is called. Otherwise,
each shareholder has one vote on show of hands.
Ordinary shares are classified as equity and recognised at the fair value of the consideration
received by the Group. No subsequent fair valuation is performed. Incremental costs directly
attributable to the issue of new shares or options are deducted from the value of issued capital.
15.2 Reconciliation of issued and paid-up capital
Opening balance as at 1 July
1,316,431,944
143,678,390
1,059,391,937
89,827,317
2022
Number of
shares
2021
$
Number of
shares
$
Issue of shares from raising capital
Costs of raising capital
Issue of shares to CEO on vesting of
performance rights
Issue of shares to CFO on vesting of
performance rights/for long-term incentives
Issue of shares to directors on vesting of
performance rights
Issue of shares to staff on vesting of long-
term incentives
Issue of shares on exercise of options
Issue of shares for service
-
-
10,010,000
(64,062)
206,672
7,633,334
162,113
6,080,000
125,531
15,339,600
324,681
-
-
709,851
44,000
-
219,999,654
54,999,914
-
(3,160,131)
8,150,000
735,650
8,937,412
506,476
5,050,000
455,832
12,901,001
1,113,637
888,303
137,755
145,577
30,000
Closing Balance as at 30 June
1,356,204,729
144,477,325
1,316,431,944
143,678,390
15.3 Performance rights
As at 30 June 2022, there were a total of 36,947,741 (2021: 70,307,676) performance rights
outstanding. Refer to Note 30.
Under the Company’s Performance Rights Plan, these performance rights were issued at no cost
to the recipients and represent a right to one ordinary share in the Company in the future for no
consideration, subject to satisfying the performance conditions and compliance with the rules of
the Plan.
15.4 Capital management
Management controls the capital of the Group in order to maintain a sustainable debt to equity
ratio, generate long term shareholder value and ensure that the Group can fund its operations and
87
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 15. Issued capital | 15.4 Capital management (cont.)
continue as a going concern. The Group’s debt and capital includes ordinary share capital and
financial liabilities, supported by financial assets.
The Group is not subject to any externally imposed capital requirements.
The Group’s objectives when managing capital are to maximize shareholder value and to maintain
an optimal capital structure. In order to maintain or adjust the capital structure, the Group may
adjust the amount of dividends paid to shareholders. Management gives particular regard to
conservation of liquidity in its recommendations as to the declaration of dividends. There were no
dividends declared in in the year.
NOTE 16. EQUITY – RESERVES AND ACCUMULATED LOSSES
16.1 Employee equity benefits reserve
The employee equity benefits reserve records items recognised as expenses on valuation of
employee performance rights and accrual of employee short-term and long-term incentives.
16.2 Other share based payments reserve
The other share based payments reserve records funding expenses accrued and are expected to
be paid in the form of shares.
16.3 Cash flow hedge reserve
The reserve is used to recognise the effective portion of the gain or loss of cash flow hedge
instruments that is determined to be an effective hedge.
Employee equity
benefits
reserve
$
Other share based
payments
reserve
$
Cash flow
hedge
reserve
$
Total
$
Movement in reserves:
At 1 July 2020
Share based payments expense
Transfer from reserve to retained earnings
Transfer from reserve on exercise of
options
Issue of shares as a result of exercise of
options for consideration
Issue of shares for services rendered
Gain/(loss) arising on changes in fair value
of hedging instruments entered into for
cash flow hedges
Cumulative loss arising on changes in fair
value of hedging instruments reclassified to
profit or loss
2,953,958
1,167,984
(4,040)
(1,835,713)
-
-
-
-
430,070
12,575
-
-
(37,486)
(30,000)
-
-
(202,842)
3,181,186
-
-
-
-
-
1,180,559
(4,040)
(1,835,713)
(37,486)
(30,000)
172,635
172,635
623,313
623,313
At 30 June 2021
2,282,189
375,159
593,106
3,250,454
88
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 16. Equity – reserves and accumulated losses | 16.3 Cash flow hedge reserve (cont.)
Movement in reserves:
At 1 July 2021
Share based payments expense
Transfer from reserve to retained earnings
Transfer from reserve on exercise of
options
Issue of shares for services rendered
Gain arising on changes in fair value of
hedging instruments entered into for cash
flow hedges
Cumulative loss arising on changes in fair
value of hedging instruments reclassified to
profit or loss
Employee equity
benefits
reserve
$
Other share based
payments
reserve
$
Cash flow
hedge
reserve
$
Total
$
2,282,189
1,246,858
(39,058)
(818,997)
-
-
-
375,159
11,025
-
-
(44,000)
593,106
3,250,454
-
-
-
-
1,257,883
(39,058)
(818,997)
(44,000)
-
20,920,095
20,920,095
-
3,380,325
3,380,325
At 30 June 2022
2,670,992
342,184
24,893,526
27,906,702
Accumulated losses:
Opening balance
Total loss after income tax for the year
Transfer from reserve to retained earnings
Total
CONSOLIDATED
2022
$
2021
$
(74,672,545)
(57,037,262)
(19,904,907)
(17,639,323)
39,058
4,040
(94,538,394)
(74,672,545)
NOTE 17. CAPITAL AND LEASE COMMITMENTS
17.1 Finance lease commitments
There are no finance lease commitments (2021: nil).
17.2 Operating lease commitments
There are no non-cancellable operating leases contracted for but not recognised in the financial
statements (2021: nil).Lease payments for operating leases, where substantially all the risks and
benefits remain with the lessor, are recognised as expenses in the periods in which they are
incurred on a straight line basis.
In December 2020 the Group entered into a property lease with a 3 year and 1 month term. Due to
the adoption of AASB 16, in the prior period, the Group had no outstanding operating lease
commitments due at 30 June 2022.
89
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
NOTE 18. INCOME TAX
Numerical reconciliation of income tax expense to prima facie tax payable
Loss from continuing operations before income tax expense
Tax benefit at the tax rate of 30% (2021: 26%)
Tax effect of amounts which are not deductible (taxable) in calculating taxable
income:
•
•
Temporary differences not recognised
Non-recognition of current year tax losses
Income tax expense
CONSOLIDATED
2022
$
2021
$
(19,904,907)
(17,639,323)
(5,971,472)
(4,586,24)
2,063,097
2,324,309
3,908,375
2,261,915
-
-
As at 30 June 2022, the entity has unrecognised carried forward tax losses of $68,239,846
(2021: $55,211,928), the utilisation of which is dependent on the entity satisfying the
requirements of the Same Business Test (SBT).
The income tax expense or benefit for the period is the tax payable / refundable on the current
period's taxable income based on the national income tax rate for each jurisdiction adjusted by
changes in deferred tax assets and liabilities, attributable to temporary differences between the
tax bases of assets and liabilities and their carrying amounts in the financial statements, and to
unused tax losses.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates
expected to apply when the assets are recovered or liabilities are settled, based on those tax
rates which are enacted or substantively enacted for each jurisdiction. The relevant tax rates are
applied to the cumulative amounts of deductible and taxable temporary differences to measure
the deferred tax asset or liability.
An exception is made for certain temporary differences arising from the initial recognition of an
asset or a liability. No deferred tax asset or liability is recognised in relation to these temporary
differences if they arose in a transaction, other than a business combination, that at the time of
the transaction did not affect either accounting profit or taxable profit or loss.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses
only if it is probable that future taxable amounts will be available to utilise those temporary
differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the
carrying amount and tax bases of investments in controlled entities where the parent entity is able
to control the timing of the reversal of the temporary differences and it is probable that the
differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset
current tax assets and liabilities and when the deferred tax balances relate to the same taxation
authority. Current tax assets and tax liabilities are offset where the entity has a legally
enforceable right to offset and intends either to settle on a net basis, or to realise the asset and
settle the liability simultaneously.
Current and deferred tax balances attributable to amounts recognised directly in equity are also
recognised directly in equity.
Wisr Limited and its wholly owned controlled entities have implemented the tax consolidation
legislation as of 1 January 2004.
90
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 18. Income tax (cont.)
The head entity, Wisr Limited, and the controlled entities in the tax consolidated group continue to
account for their own current and deferred tax amounts. These tax amounts are measured as if
each entity in the tax consolidated group continues to be a standalone taxpayer in its own right.
In addition to its own current and deferred tax amounts, Wisr Limited also recognises the current
tax liabilities (or assets) and the deferred tax assets arising from unused tax losses and unused
tax credits assumed from controlled entities in the tax consolidated group.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are
recognised as amounts receivable from or payable to other entities in the group.
Any difference between the amounts assumed and amounts receivable or payable under the tax
funding agreement are recognised as a contribution to (or distribution from) wholly owned tax
consolidated entities.
NOTE 19. REMUNERATION OF AUDITORS
During the year, the following fees were paid or payable for services provided by the auditor:
BDO Audit Pty Ltd
•
•
•
•
Audit of the financial report – assurance services
Taxation services – non-assurance services
Review of the half-yearly financial report – assurance services
Accounting advice – non-assurance services
CONSOLIDATED
2022
$
2021
$
121,500
34,102
43,000
2,000
97,500
2,500
43,699
-
200,602
143,699
The BDO entity performing the audit of the Group transitioned from BDO East Coast Partnership
to BDO Audit Pty Ltd on 25 September 2020. The FY2021 comparatives include amounts received
or due and receivable by BDO East Coast Partnership, BDO Audit Pty Ltd and their respective
related entities.
NOTE 20. CONTINGENT ASSETS AND LIABILITIES
There were no material contingent assets and liabilities reportable during the period (2021: nil).
NOTE 21. SUBSIDIARIES
The consolidated financial statements incorporate the assets, liabilities and results of the
following subsidiaries in accordance with the accounting policies described in Note 1:
91
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 21. Subsidiaries (cont.)
Name
Status
Wisr Finance Pty Ltd
Registered 2 May 2006
Wisr Investment Management Pty Ltd
Registered 20 February 2015
Wisr Loans Servicing Pty Ltd
Registered 20 February 2015
Wisr Credit Management Pty Ltd
Registered 19 March 2015
Wisr Marketplace Limited
Registered 16 March 2015
Wisr Services Pty Ltd
Wisr Funding Pty Ltd
Wisr Notes 1 Pty Ltd
Registered 13 January 2017
Registered 9 April 2018
Registered 31 July 2018
Wisr Warehouse Trust No. 1
Registered 28 October 2019
Wisr Freedom Trust 2021-1
Registered 29 March 2021
Wisr Warehouse Trust No. 2
Registered 25 August 2021
Wisr Freedom Trust 2022-1
Registered 8 April 2022
Country of
incorporation
% owned
2022
% owned
2021
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
-
-
NOTE 22. EVENTS AFTER THE REPORTING PERIOD
There are no significant events to report after the reporting period.
NOTE 23. KEY MANAGEMENT PERSONNEL DISCLOSURES
23.1 Compensation
The aggregate compensation made to directors and other members of key management
personnel of the consolidated entity is set out below:
Short-term employee benefits
Post-employment benefits
Long-term benefits
Share-based payments
Total KMP compensation
CONSOLIDATED
2022
$
2021
$
1,257,342
955,525
60,898
24,553
68,389
6,874
150,967
234,762
1,493,760
1,265,550
23.2 Short-term employee benefits
These amounts include fees and benefits paid to the Chair and non-executive directors as well as
all salary, paid leave benefits, fringe benefits and cash bonuses awarded to directors and other
KMP.
23.3 Post-employment benefits
These amounts are the current year’s estimated cost of providing for the Group’s superannuation
contributions made during the year.
92
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 23. Key management personnel disclosures (cont.)
23.4 Long-term benefits
These amounts represent long service leave benefits accruing during the year.
23.5 Share-based payments
These amounts represent the expense related to the participation of KMP in equity-settled benefit
schemes as measured by the fair value of the options, rights and shares granted on grant date.
NOTE 24. RELATED PARTY TRANSACTIONS
24.1 Parent entity
The legal parent is Wisr Limited.
24.2 Subsidiaries
Interest in subsidiaries are set out in Note 20.
24.3 Transactions with related parties
As at 30 June 2022, all transactions that have occurred among the subsidiaries within the Group
have been eliminated for consolidation purposes.
During the period, there were no related party transactions (2021: $101,745).
NOTE 25. PARENT ENTITY INFORMATION
25.1 Summary financial information
The individual financial statements for the parent entity show the following aggregate amounts:
Statement of financial position
Total assets
Total liabilities
Shareholders’ equity
Issued capital
Reserves
Accumulated losses
Loss for the year
Total comprehensive loss
2022
$
2021
$
133,484,456
135,597,217
6,744,732
6,760,996
137,465,097
136,666,162
3,013,176
2,657,348
(13,738,549)
(10,487,289)
126,739,724
128,836,221
(3,290,318)
(969,627)
(3,290,318)
(969,627)
93
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 25. Parent entity information (cont.)
The financial information for the parent entity, Wisr Limited, has been prepared on the same basis
as the consolidated financial statements, except that investments in subsidiaries are accounted
for at cost net of impairment in the parent financial statements.
25.2 Contingent liabilities
See Note 20.
25.3 Contractual commitments
The parent entity had no capital commitments for property, plant and equipment as at 30 June
2022 and 30 June 2021.
NOTE 26. CASH FLOW INFORMATION
Reconciliation of loss after income tax to net cash outflows from operating activities
Loss for the year
Adjustments for non-cash items or items for which the cash flows are investing or
financing cash flows
Depreciation and amortisation
Share-based payments and accruals
Fundraising expenses
CONSOLIDATED
2022
$
(19,904,907
)
2021
$
(17,639,323)
931,461
541,922
1,118,686
1,180,559
518,764
592,044
Expected credit losses expense / loan asset impairments and write-offs
16,352,472
7,934,680
Right of use asset expenses
Loss on investments
Changes in operating assets and liabilities:
(Increase) in loan receivables
Decrease / (Increase) in trade and other receivables
(Increase) in other assets
Increase in trade and other payables
Increase in provision for employee benefits
Increase in accrued finance costs
Net cash flows used in operating activities
-
102,840
1,168,695
-
(4,583,274)
(2,536,175)
143,458
(185,308)
(478,861)
(32,189)
1,255,346
1,348,359
435,339
464,743
330,675
379,320
(2,578,078)
(7,982,596)
94
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
NOTE 27. EARNINGS PER SHARE
Basic earnings per share
Diluted earnings per share
2022
Cents
(1.48)
(1.48)
2021
Cents
(1.60)
(1.60)
Number of
shares
Number of
shares
Weighted average number of shares used as the denominator
Weighted average number of shares used as the denominator in calculating basic
earnings per share
1,347,814,306
1,105,463,088
Adjustments for calculation of diluted earnings per share
Weighted average number of ordinary shares used in calculating dilutive
earnings per share
-
-
1,347,814,306
1,105,463,088
The performance rights on issue have not been considered in the diluted earnings per share as
their effect is anti-dilutive.
27.1 Basic earnings per share
Basic earnings per share is calculated by dividing the result attributable to equity holders of the
Company by the weighted average number of ordinary shares outstanding during the financial
year.
27.2 Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per
share to take into account the after income tax effect of interest and other financing costs
associated with dilutive potential ordinary shares and the weighted average number of shares
assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.
NOTE 28. SEGMENT INFORMATION
Management has determined that the Group has one operating segment, being the provision of
personal loans to consumers. The internal reporting framework is based on the principal activity
as discussed above and is the most relevant to assist the Board as Chief Operating Decision
Maker with making decisions regarding the Group and its ongoing growth. The assets as
presented relate to the operating segment. The Group operates in Australia only as at 30 June
2022.
NOTE 29. DIVIDENDS
29.1 Dividends paid during the year
Ordinary shares
There were no dividends paid during the year (2021: nil).
95
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 29. Dividends (cont.)
29.2 Franking Credits
Franking credits available for subsequent reporting periods based on a tax rate of 30%
(2021 – 26%)
2022
$
2021
$
1,542,955
1,542,955
The above amounts are calculated from the balance of the franking account as at the end of the
reporting period, adjusted for franking credits and debits that will arise from the settlement of
liabilities or receivables for income tax and dividends after the end of the year.
NOTE 30. SHARE BASED PAYMENTS
The share-based payment expense of $1,257,883 has been incurred in the year of which
$1,118,686 (2021: $1,180,559) is recognised in the consolidated profit and loss statement and the
remaining $139,197 has been capitalised as part of intangible assets (2021: nil):
The breakdown of the share based payments for the year are as follows:
• Board/KMP LTIs of $150,967 (2021: $234,762) accrued up to 30 June 2022;
• Staff LTIs $956,694 (2021: $933,222) accrued up to 30 June 2022 and relate to FY18 – FY22;
• Recruitment expense of $11,025 (2021: $12,575); and
• Staff LTIs of $139,197 which have been capitalised as part of intangible assets.
The fair value of the Board/KMP performance rights and staff LTI scheme has been calculated in
accordance with AASB 2 Share-based Payment using a Hoadley Barrier model which included the
below inputs.
FY22 Staff LTI scheme:
Assumptions - Grant date 1 July 2021, Volatility 40%, Spot price $0.26.
Tranche
1
2
Expiry date
31 Jul 23
31 Jul 24
Barrier price
$0.298
$0.298
Fair value
$0.1333
$0.1442
FY22 LTI scheme for director, Mr Matthew Brown:
Assumptions - Grant date 24 November 2021, Volatility 40%, Spot price $0.27.
Tranche
Rights granted
Expiry date
Barrier price
Fair value
360,000
452,000
544,000
581,000
30 Nov 24
30 Nov 24
30 Nov 24
30 Nov 24
$0.306
$0.353
$0.405
$0.798
$0.2458
$0.0815
$0.0471
$0.0561
1
2
3
4
96
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 30. Share based payments (cont.)
Performance rights
Balance at beginning of year
•
•
•
Granted
Forfeited
Exercised
Balance at end of year
Number of
performance rights
70,307,676
16,199,665
(13,830,000)
(35,729,600)
36,947,741
2022
Exercise
price
Nil
Nil
Nil
Nil
Nil
Number of
performance rights
92,717,541
11,645,187
(4,054,051)
(30,001,001)
70,307,676
2021
Exercise
price
Nil
Nil
Nil
Nil
Nil
The Group provides benefits to employees in the form of share-based payment transactions,
whereby employees render services in exchange for shares or performance rights (equity-settled
transactions).
The cost of the transactions with employees is measured by reference to the fair value at the date
at which they are granted. The fair value is determined by using a binomial model. In valuing
equity-settled transactions, no account is taken of any performance conditions, other than
conditions linked to the price of the shares of the Company (market conditions). The cost of
equity-settled transactions is recognised as an expense, 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 employees become fully entitled to exercise the rights (vesting date).
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
rights that, in the opinion of the Directors of the Company, 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
option are modified, at 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 the modification.
NOTE 31. INVESTMENTS
In March 2021, the Group executed a term sheet for an investment in European fintech platform
Arbor. On 5 August 2021, the Group completed its initial investment, consisting of EUR715,358
($1,168,695) in exchange for a 12.5% ownership stake.
In addition to the 12.5%, Wisr has options in place to increase its ownership stake to 45% over
three years subject to valuation thresholds and contingent upon certain milestones being
achieved.
Arbor is an EU based fintech with a financial wellness platform, utilising a digital wallet to offer
savings, investment and lending features.
A fair value assessment was performed at 31 December 2021. Noting that the Arbor investment
was performing in line with expectations, given the short tenure of the existing investment,
private corporate structure and early stage of the business, no change to the current value was
deemed necessary. The impact of forex movement was also considered and deemed immaterial.
97
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 31. Investments (cont.)
Subsequent to the fair value assessment, during H2FY22, Arbor planned a funding round for
additional capital. The round was ultimately unsuccessful which included Wisr being unwilling to
commit any further material capital, particularly given the current focus on core operations. Arbor
is now in the process of wind down and Wisr has accordingly written down the original investment
value to nil.
NOTE 32. FINANCIAL RISK MANAGEMENT
The business of the Group and the industry in which it operates are subject to risk factors both of
a general nature and risks which are specific to the industry and/or the Group’s business
activities.
The potential effect of these risk factors either individually, or in combination, may have an
adverse effect on the future financial and operating performance of the Group, its financial
position, its prospects and the value of its shares.
The following are the key risks that specifically relate to the Group:
32.1 Credit risk
As a lending business, the Group is at risk of a larger than expected number of its borrowers
failing or becoming unable to repay their loans, particularly for loans which are held on balance
sheet as opposed to being funded by a third party. While loans are assessed according to a strict
Credit Manual and Credit Risk Policy as well as being targeted at prime retail borrowers (not
‘payday’ lending customers), the loans may be unsecured and so are subject to the capacity of
the individual borrower to repay the loan.
32.2 Inability to recover defaulted loans
Default is defined by the group as the failure of the borrower to meet required contractual
cashflows, this definition is selected as it aligns with the operational analysis of the loan books. If
a borrower does not meet their required loan payments and the loan goes into default, the Group
may not be able to recover the relevant portion of the value of the loan or the cost of recovery of
the loan may be deemed to be greater than the amount potentially recoverable, even if the
borrower owns assets such as a house. In this case the loan may be sold (at a loss) to a third
party or written off as a bad debt. High levels of bad debts could limit profitability and adversely
affect future performance. The Group mitigates this risk by approving loans according to a strict
credit criteria. The risk is also mitigated through the use of third party funders for a proportion of
loans.
32.3 Fraudulent borrowers
There is a general ongoing risk that borrowers may deliberately fabricate evidence to support loan
applications and they have no intention of paying off their loan. The Group has procedures in
place to detect fraudulent applications and activities, however the risk of fraud cannot be totally
removed.
98
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 32. Financial risk management (cont.)
32.4 Personal Loans may be unsecured
The Group’s loans may be issued on an unsecured basis. The Group’s reputation and financial
position could be adversely impacted if the Group’s targeted credit performance of its loan book
is not met and collections and debt recovery procedures prove less than effective.
32.5 Costs of acquiring loans
The Group’s business model and on-going commercial viability is directly linked to its ability to
attract suitable borrowers and increase the volume of loans funded and managed by the Group.
The Group has built its existing loan volumes using a mix of direct channel marketing (using
search engine marketing and media advertising) and developing relationships with mortgage and
finance brokers to introduce loans. The Group has forecasted the future costs of acquiring loans
in the desired volumes however these costs are subject to market forces and cannot be predicted
with certainty.
32.6 Ability to source third party funding and sell loans
The Group’s business model and on-going commercial viability is strongly linked to its ability to
source sufficient third-party funding to enable it to sell its loans and raise the funds to lend to
potential borrowers.
The Group seeks to manage this risk by establishing multiple sources of institutional loan buyers.
32.7 Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash to ensure the ability to meet
financial obligations as they fall due. The Group manages liquidity risk by maintaining a cash
reserve and continuously monitoring forecast and actual cash flows.
MATURITY ANALYSIS – GROUP
2022
Financial assets
Non-derivatives
Cash and cash equivalents
Loan receivables
Trade and other receivables
Other assets
Derivatives at fair value
Interest rate swaps – cash flow hedges
Total financial assets
Financial liabilities
Non-derivatives
Trade creditors
Other payables
Borrowings
Total financial liabilities
Net financial assets
Within 1 year
$
1-5 years
$
Total
$
71,489,070
-
134,644,329
630,194,399
1,065,176
113,201
-
561,629
71,489,070
764,838,728
1,065,176
674,830
8,845,960
216,157,736
17,471,816
26,317,776
648,227,844
864,385,580
2,428,912
3,006,781
929,489
6,365,182
-
-
781,352,865
781,352,865
209,792,554
(133,125,021)
2,428,912
3,006,781
782,282,354
787,718,047
76,667,533
99
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 32. Financial risk management | 32.7 Liquidity risk (cont.)
2021
Financial assets
Non-derivatives
Cash and cash equivalents
Loan receivables
Trade and other receivables
Other assets
Derivatives at fair value
Within 1 year
$
1-5 years
$
Total
$
92,409,558
61,941,741
1,208,633
139,987
-
312,709,638
-
-
92,409,558
374,651,379
1,208,633
139,987
Interest rate swaps – cash flow hedges
(945,755)
1,236,631
290,876
Total financial assets
Financial liabilities
Non-derivatives
Trade creditors
Other payables
Borrowings
Total financial liabilities
Net financial assets
32.8 Market risk
Price risk
154,754,164
313,946,269
468,700,433
2,043,859
1,901,473
516,736
4,462,068
-
-
391,955,741
391,955,741
150,292,096
(78,009,472)
2,043,859
1,901,473
392,472,477
396,417,809
72,282,624
The Group is not exposed to any significant price risk at 30 June 2022.
32.9 Interest rate risk
Interest rate risk is the risk that the Group will experience deterioration in its financial position as
interest rates change over time. The Group is exposed to interest rate risk due to repricing and
mismatches in interest rates between assets and liabilities (i.e. borrowing at floating interest rates
and lending at fixed interest rates). The risk is managed by the Group using interest rate swap
contracts to convert the floating rate exposure on the Warehouse trust borrowings to fixed
interest rates. Hedging activities are undertaken in line with the Group's hedging policy.
Interest rate swap contracts
Under interest rate swap contracts, the Group agrees to exchange the difference between fixed
and floating rate interest amounts calculated on agreed notional principal amounts. Such
contracts enable the Group to mitigate the cash flow exposures on its variable rate borrowings.
The Group designates the interest rate swap contracts as cash flow hedges. As the critical terms
of the interest rate swap contracts and their corresponding hedged items are the same, the Group
performs a qualitative assessment of effectiveness and it is expected that the value of the
interest rate swap contracts and the value of the corresponding hedged items will systematically
change in opposite direction in response to movements in the underlying interest rates. The main
source of hedge ineffectiveness in these hedge relationships is the effect of the counterparty and
the Group’s own credit risk on the fair value of the interest rate swap contracts, which is not
reflected in the fair value of the hedged item attributable to the change in interest rates. Other
sources of ineffectiveness include the re-designation of amended interest rate swap contracts,
which have a non-zero fair value at inception of the hedge relationship.
100
WISR LIMITED • ANNUAL REPORT 2022
FINANCIAL REPORT | NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2022
Note 32. Financial risk management (cont.)
The following table details various information regarding interest rate swap contracts outstanding
at the end of the reporting period and their related hedged items. Interest rate swap contract
assets and liabilities are included in Note 14.
Hedging instruments
• Average contracted fixed interest rate
• Notional principal (borrowings)
• Carrying amount of the hedging instrument (liability)
• Change in fair value used for calculating hedge ineffectiveness
Hedged items
• Nominal amount of the hedged item
• Change in value used for calculating hedge ineffectiveness
Balance in cash flow hedge reserve for continuing hedges
Balance in cash flow hedge reserve arising from hedging relationships for which hedge
accounting is no longer applied
INTEREST RATE SWAPS
2022
2021
1.42734%
0.37050%
693,426,793 336,825,995
24,856,717
15,442,262
264,050
710,674
693,426,793 336,825,995
16,791,815
15,564,838
797,545
710,674
9,328,688
(117,568)
Hedge ineffectiveness recognised in profit or loss (within Finance costs)
525,784
(51,240)
101
WISR LIMITED • ANNUAL REPORT 2022
DIRECTORS’ DECLARATION
The directors of the Company declare that, in the opinion of the directors:
a.
the attached financial statements and notes thereto are in accordance with the
Corporations Act 2001, including:
i.
ii.
giving a true and fair view of the financial position and performance of the consolidated
entity; and
complying with Australian Accounting Standards, including the interpretations, and the
Corporations Regulations 2001;
b.
c.
d.
the financial statements and notes thereto also comply with International Financial
Reporting Standards, as disclosed in Note 1;
the directors have been given the declarations required by s.295A of the Corporations Act
2001; and
there are reasonable grounds to believe that the Company will be able to pay its debts as
and when they become due and payable;
Signed in accordance with a resolution of the directors made pursuant to s.295(5) of the
Corporations Act 2001.
...............................................................
JOHN NANTES
DIRECTOR
Sydney
30 August 2022
102
WISR LIMITED • ANNUAL REPORT 2022
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF WISR LIMITED
103
WISR LIMITED • ANNUAL REPORT 2022
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF WISR LIMITED
104
WISR LIMITED • ANNUAL REPORT 2022
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF WISR LIMITED
105
WISR LIMITED • ANNUAL REPORT 2022
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF WISR LIMITED
106
WISR LIMITED • ANNUAL REPORT 2022
ASX ADDITIONAL INFORMATION
Additional information required by the ASX Limited Listing Rules and not disclosed elsewhere in
this report is set out below. This information is effective as at 23 September 2022.
a. Distribution of shareholders
The distribution of issued capital as at 23 September 2022 were as follows:
Size of holding
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Number of shareholders
Number of ordinary shares Percentage of issued capital
199
1,264
1,014
2,930
1,104
6,511
40,106
4,148,091
8,139,861
118,231,980
1,225,644,691
1,356,204,729
0.00
0.31
0.60
8.72
90.37
100.00
There were 2,038 shareholders with unmarketable parcels totalling 8,048,193 shares based on
the share price as at close of business on 23 September 2022.
b. Distribution of performance rights holders
The distribution of unquoted Performance Rights on issue as at 23 September 2022 were as
follows:
Size of holding
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Number of holders
Number of unquoted rights
-
-
1
25
35
61
-
-
5,063
1,141,888
31,205,644
32,352,595
c. Distribution of options
The distribution of unquoted Options on issue as at 23 September 2022 were as follows:
Size of holding
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Number of holders
Number of unquoted rights
-
-
-
-
5
5
-
-
-
-
9,731,948
9,731,948
107
WISR LIMITED • ANNUAL REPORT 2022
ASX ADDITIONAL INFORMATION
d. Substantial shareholders
The names of substantial shareholders listed in the Company’s register as at 23 September 2022
were as follows:
Shareholder
ADCOCK PRIVATE EQUITY PTY LTD
ADCOCK GROUP SUPER PTY LTD
MR BROOK ANTHONY ADCOCK
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
ALCEON GROUP PTY LTD
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
Number of fully paid
ordinary shares
Percentage of
issued capital (%)
151,266,843
41,177,864
519,631
192,964,338
100,389,726
54,054,054
154,443,780
70,527,710
11.15
3.04
0.04
14.23
7.40
3.99
11.39
5.20
Total
417,935,828
30.82
e. Twenty largest shareholders of quoted equity securities
The twenty largest shareholders of quoted equity securities were as follows:
Shareholder
ADCOCK PRIVATE EQUITY PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
ANTHONY NANTES
ALCEON GROUP PTY LTD
CITICORP NOMINEES PTY LIMITED
ADCOCK GROUP SUPER PTY LTD
NETWEALTH INVESTMENTS LIMITED
ANDREW GOODWIN
MACQUARIE BANK LIMITED
LUAGA PTY LTD
DE NANTES INVESTMENT CO PTY LTD
MOSLOF SERVICES PTY LTD
GENTILLY INVESTMENTS PTY LTD
GENTILLY HOLDINGS PTY LTD
BNP PARIBAS NOMS PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
CS FOURTH NOMINEES PTY LIMITED
MR CHRISTOPHER MICHAEL WHITEHEAD
BNP PARIBAS NOMINEES PTY LTD
Number of fully paid
ordinary shares
Percentage of
issued capital (%)
151,266,843
100,389,726
70,527,710
57,268,736
54,054,054
41,757,599
41,177,864
40,082,481
26,108,903
18,998,019
18,467,952
13,201,370
12,775,000
12,576,732
12,501,586
12,143,451
8,126,189
8,035,237
6,990,000
6,627,145
11.15
7.40
5.20
4.22
3.99
3.08
3.04
2.96
1.93
1.40
1.36
0.97
0.94
0.93
0.92
0.90
0.60
0.59
0.52
0.49
Total
713,076,597
52.59
f. Restricted securities
79,120,359 ordinary shares are currently subject to voluntary escrow pending Company approval.
108
WISR LIMITED • ANNUAL REPORT 2022
ASX ADDITIONAL INFORMATION
g. Unquoted equity securities
The Company had the following unquoted securities on issue as at 23 September 2022:
Unquoted Options
The Company had 5 holders of options with a total of 9,731,948 unquoted options on issue as at
23 September 2022. 2,345,585 options are held by 255 Finance Investments Pty Ltd and
2,316,676 options are held by Teragoal Pty Ltd.
Performance Rights
The Company had 61 holders of performance rights with a total of 32,352,595 performance rights
on issue as at 23 September 2022 as part of an employee incentive.
h. Voting rights
i. Ordinary Shares
In accordance with the Constitution each member present at a meeting whether in person, or
by proxy, or by power of attorney, or in a duly authorised representative in the case of a
corporate member, shall have one vote on a show of hands, and one vote for each fully paid
ordinary share, on a poll.
ii. Performance Rights and Options
Holders of Performance Rights and Options have no voting rights.
i. On-market buy-backs
There is no current on-market buy back in relation to the Company’s securities.
109
WISR LIMITED • ANNUAL REPORT 2022
CORPORATE DIRECTORY
DIRECTORS
John Nantes (Chairman)
Craig Swanger
Matthew Brown
Cathryn Lyall
Kate Whitney
COMPANY SECRETARY
Vanessa Chidrawi
May Ho
REGISTERED OFFICE
Level 4, 55 Harrington Street,
The Rocks, New South Wales,
Australia
Telephone: (02) 8379 4008
Facsimile: (02) 8076 3341
SHARE REGISTER
Computershare Investor Services Pty Limited
452 Johnston Street
Abbotsford, Victoria
Telephone: (03) 9415 5000
AUDITOR
BDO Audit Pty Ltd
Level 11, 1 Margaret Street
Sydney, New South Wales
STOCK EXCHANGE LISTING
Shares are listed on the Australian Stock Exchange (ASX: WZR)
DOMICILE
Publicly listed company incorporated in Australia
110
ABN 80 004 661 205
wisr.com.au
Level 4, 55 Harrington St,
The Rocks NSW 2000
+61 2 8379 4008
WISR LIMITED • ANNUAL REPORT 2022