ANNUAL
REPORT
2018
Xref Limited / Annual Report 2018 / 1
CONTENTS
2018 Highlights
Chairman’s Report
Chief Executive Officer’s & Chief Technology Officer’s Report
Directors’ Report
Independence Declaration
Financial Statements
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Shareholder Information
Corporate Directory
2
4
6
10
26
27
34
76
77
82
86
With Xref, clients
make more confident,
smarter decisions.
2 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 3
2018
Highlights
Total Sales
$7.1 million
72%
TOTAL ANNUAL GROWTH
Recognised Revenue
$4.8 million
63%
TOTAL ANNUAL GROWTH
Overseas Sales
Channel Sales
New Client Sales
13%
24%
45%
Australia
Overseas
Direct
Channel
Existing
New
KEY METRICS
ANNUAL REVENUE
PER ACCOUNT (ARPA)
New clients acquired during FY18 contributed
an ARPA of $8,4k, while for clients in their
second, third and fourth year their ARPA
has grown to $9.5k, $12.5k and $17.9k
respectively.
Sales Revenue vs Recognised Revenue
SALES REVENUE VS RECOGNISED REVENUE
Credit sales: $7.1m
Revenue: $4.8m
Credit sales: $4.1m
Revenue: $3.0m
Credit sales: $0.67m
Revenue: $0.37m
Credit sales: $1.7m
Revenue: $1.3m
8
7
6
5
4
3
2
1
s
n
o
i
l
l
i
M
$
FY15
FY15
(1)
FY16
FY16
FY17
FY17
FY18
FY18
Under Xref’s business model, clients purchase Xref credits to use our candidate referencing platform. These credit sales are
reported initially as unearned income, and when clients pay for the credits, this is recognised as cash receipts. The credits
are consumed when reference checks are ordered, and credit usage becomes recognised revenue.
CLIENT
ACQUISITION
Client acquisition continued to strengthen
and at 30 June 2018, more than 750 direct
paying clients were using our services
globally. Use of integrations to access Xref
also more than doubled in the final quarter
of FY18 alone and at the end of the financial
year 136 clients use our platform through
channel partners.
$17.9K
$9.5K
Acquired FY17
Acquired FY15
32%
Acquired
FY17
58%
Acquired
FY16
89%
Acquired
FY15
CLIENT
ADOPTION
The adoption rate for newly acquired
clients is 29% in their first year. For
clients in their second, third and fourth
years adoption rates have grown to
32%, 58% & 89% respectively. Overall
client adoption was 38% at the end of
the financial year.
379
Acquired
224
Acquired
Existing
New
42
Acquired
121
Acquired
FY14
FY15
FY16
FY17
FY18
2 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 3
Chairman’s
Report
CHAIRMAN’S REPORT
Xref now supports over 750 direct paying clients as well
A dedicated team
as those businesses accessing our platform through
our 13 established channel partners. Sales via channel
partners now contribute over 20% of sales revenue which
enables us to expand worldwide cost-effectively. Xref’s
strong client acquisition and retention are testament to
the value of our powerful technology platform.
We delivered strong growth in Australia, and international
sales continued to ramp up faster than Australian sales at
the same stage of market development. We have focused
on building skilled sales teams in Europe, the Nordics
region and North America, that can replicate Australia’s
fast sales growth.
Technological leadership
I am excited by our team’s ongoing innovation. Our
newest product, People Search, for example, provides
a leading analytics platform, helping employers and
recruitment professionals efficiently make use of existing
Xref’s strong growth has been possible because of the
many positive skills and attributes of our staff. This
includes - but doesn’t end at - the human resources
and recruitment specialists who ensure our teams really
understand our customers, our technical experts who
strive to continually improve and evolve the service
we offer, and our customer success teams who offer
unrivalled support for our clients around the clock.
I would like to express my thanks for the dedication
and ongoing enthusiasm of all our employees and to
acknowledge their outstanding work over the past year.
I would also like to acknowledge the investors who
participated in our August 2017 capital raising, as
well as all our shareholders. Xref now has a strong
‘institutional’ register and our shareholders have been
a vital ingredient in helping the Company to capitalise
on its growth opportunity.
referee data in their Xref account, to find ‘passive’
Ongoing growth
Having laid the foundations for strong and sustainable
growth, an exciting path lies ahead. We now have
a burgeoning business with unrivalled talent and
technology, and a sustainable business structure and
cost base. As we continue to expand and evolve, we
are well positioned for growth in all markets. We look
forward to further
increasing market penetration,
expanding our partner network and building a profitable
global business.
Welcome to Xref’s third annual report.
This has been another year of great success for Xref. We
are capitalising on a unique position in the global human
resources technology market, providing a fully API-
driven, software as a-service platform that simplifies the
way employers seek references. We automate one of the
most difficult, time-consuming recruitment processes –
obtaining candidate references – and provide intuitive,
data-driven insights for human resources practitioners.
candidates that meet top talent criteria. Identifying
experienced and well-qualified candidates who may not
be actively seeking employment is an ongoing challenge
for the industry, this platform takes Xref users another
Technological change is creating massive opportunities
step beyond traditional sourcing techniques.
for growth, particularly within the $14 billion human
resources software sector. Globally, many organisations
Helping clients meet regulatory needs
are transitioning to the cloud, creating opportunities
The
introduction of the General Data Protection
for companies such as Xref, which has a first-mover
Regulation (GDPR) in May 2018, marked one of the
advantage, to serve the growing data-driven recruiting
biggest collective shifts in the way businesses operate
sector.
Strong sales and client growth
across the EU. Effective data management has become
a key technology challenge for organisations globally.
We are proud to offer the assurance of a fully GDPR-
It is with great pleasure that we report credit sales for the
compliant reference checking process and actively
year of $7.1 million, up 72% when compared to FY17. The
support our clients’ compliance with their regulatory
Brad Rosser,
Chairman
rapid rate of Xref’s organic growth can truly be seen in
obligations.
the fact that sales revenue for just the last week of FY18
was almost equal to the sales revenue generated during
the entire year of FY15, before the company’s listing on
the ASX.
4 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 5
Chief Executive Officer’s &
Chief Technology Officer’s Report
CHIEF EXECUTIVE OFFICER’S & CHIEF TECHNOLOGY OFFICER’S REPORT
Under Xref’s business model, clients purchase Xref
credits to use our candidate referencing platform. These
credit sales are reported initially as unearned income,
and when clients pay for the credits, this is recognised
as cash receipts. The credits are consumed when
reference checks are ordered, and credit usage becomes
recognised revenue.
Growing Average Revenue Per Account (ARPA)
Together with increased client acquisition and adoption,
a sales focus on enterprise organisations and high-
value sectors has contributed to an increase in Average
Revenue Per Account (ARPA). This
is another key
benchmark by which we measure our progress. Our
ability to increase penetration within existing clients’
businesses, accessing a greater proportion of available
hires, can be seen by comparing the ARPA for new and
established clients.
New clients acquired during FY18 contributed an ARPA
of $8.4k, while for clients in their second, third and
fourth year their ARPA has grown to $9.5k, $12.5k and
$17.9k respectively. Overall ARPA has grown to $10k. This
demonstrates clients’ increased use of our platform over
time and validates its value to their businesses.
A highlight of the year was the opening of our Norwegian
office in September 2017 to service the Nordic region,
comprising Norway, Denmark, Sweden, Iceland and
Finland. The Norwegian team has strong recruitment
sector experience, and has already welcomed some
extremely high-profile clients, including Clas Ohlsen,
the Norwegian Refugee Council and Norwegian State
Railways (NSB). The labour market in this region is
approximately 30% larger than Australia’s, so we are
very excited about the opportunity to build on these
early successes.
Our total addressable market includes more than 180
These platforms provide talent management solutions
million people in North America, 120 million people
for more than 50,000 organisations worldwide. We
in Europe, and 15 million people in Australia and New
participate in joint marketing activities with integration
Zealand. Having opened our first international sales
partners to promote Xref’s platform, which can be easily
office in 2016, we now support clients from offices in
accessed through partners’ marketplaces.
Sydney, London, Oslo and Toronto and our services have
been used by employers, recruiters candidates and their
referees in over 190 countries across the world.
During FY18, we also launched a public API platform
to allow third-party organisations to more efficiently
integrate their software with Xref. This reduces the time
International sales represented 13% of the total achieved
required to bring an integration with Xref’s platform to
in FY18, and trends are showing that this proportion
market. Shortly after the close of the financial year, we
will continue to grow. During the year we introduced
announced our first public API-driven integration with
notable new clients in every region - in Australia and New
recruitment solution provider, PeopleScout.
Zealand, these included Incitec Pivot, NRMA, and Coca
Cola Amatil New Zealand; in Europe, Shangri-La Hotel
Group, UBM plc and Sanctuary Group; and new North
American clients, Snapchat (Snap Inc.), Hays Canada,
and SCM Insurance.
Channel expansion
The
integration partner channel
is an essential
component of our global growth strategy. It allows
enterprise companies to seamlessly embed the Xref
solution into their human resources workflow. We help to
educate partner sales teams so they become advocates
for our services, providing a cost-effective way to win
Use of integrations to access Xref more than doubled
in the final quarter of FY18 alone and at the end of
Increased scalability and product
improvement
During the year we continually improved and refined our
services, increasing scalability and security, and adding
new language capabilities to our solution. We introduced
the Sentiment Engine, which provides a graphical way to
interpret written references and offers further insight
into referees’ responses, at a glance. We also beta
launched People Search, a paid platform addition which
offers users the ability to find and filter historical referee
data that could present passive candidate targeting
opportunities. Further platform updates
introduced
during the year included report branding, enhanced
data analytics, enterprise security, GDPR compliance and
improved user management features.
the financial year 136 clients use our platform through
Cost management
channel partners, including Qantas, Westpac and the
NSW Government.
In FY18, we commenced several new channel partnerships
and our integration portfolio now includes some of the
world’s leading HR technology providers, including
Bullhorn, Checkr, Equifax, Expr3ss!, iCIMS, Lever, Oracle
Taleo, SmartRecruiters, SnapHire, Talent App Store,
Workday and Zapier. In June 2018, we launched our latest
platform integration with recruitment software provider,
JobAdder, taking us to a total of 13 live integrations by
the end of the year.
While investing to support global growth, we have
maintained a tight control over costs and cash outflows
have been in line with anticipated budgets throughout
the year. A new sales platform has significantly improved
the speed of client acquisition, reducing the length of the
sales cycle to secure new clients by 55% from 80 days to
39 days. Having expanded internationally to drive sales,
our costs have now steadied as we experience significant
revenue growth
Accelerating global growth
new clients.
Records for all key metrics
We are delighted to report another year of record results
and incredible progress across all key business metrics.
Sales of Xref credits increased more than 70% year-on-
year to a record $7.1 million in FY18, up from $4.1 million
in FY17. Recognised Revenue increased 63%, rising to
$4.8 million from $2.9 million.
Client acquisition continued to strengthen, and at 30 June
2018, more than 750 direct paying clients were using our
services globally, excluding those accessing our platform
through our partner network. We also measure our
growth success in terms of client adoption, based on the
rate at which clients implement our services across their
entire organisation. 45% of sales revenue was derived
from new clients in FY18. Adoption rates for these new
clients is already 29%. For clients in their second, third
and fourth years adoption rates have grown to 32%, 58%
and 89% respectively. Overall client adoption was 38%
at the end of the financial year.
Business model
Xref’s cloud-based software allows companies to harness
the benefits of technology, supporting timely, data-
driven decisions on talent acquisition and retention while
reducing employers’ exposure to security breaches,
discrimination and potential fraud.
6 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 7
CHIEF EXECUTIVE OFFICER’S & CHIEF TECHNOLOGY OFFICER’S REPORT / Continued
We have continually refined our business processes
Importantly, we retain our first-mover advantage and
to ensure that as we grow we become an increasingly
have a unique, leading technology platform which
lean organisation. We are focused on building for
consistently provides a high return on investment for
the future and expect to benefit from increased
clients backed by unrivalled customer support. The
efficiencies in FY19 through greater scale.
new financial year has started well with sales in line
Positive outlook for growth
with management expectations. We wish to thank
our clients, team and shareholders for their ongoing
We enter the new financial year in a very positive
support as we continue to build a sustainable global
position. Our markets are growing, and we have
business.
a strong pipeline of new business opportunities
across Australia and New Zealand, United Kingdom
& the Nordics and in North America, supported by
experienced, skilled teams. Our business is benefiting
from faster client adoption, accelerating new client
and integration sales, and ongoing renewals.
Lee-Martin Seymour,
Tim Griffiths,
Chief Executive Officer,
Chief Technical Officer,
Co-Founder
Co-Founder
8 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 9
Directors’
Report
DIRECTORS’ REPORT
The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter
Strong global growth
as the ‘consolidated entity’) consisting of Xref 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 2018.
Xref continues to invest to build global scale, capitalising on its unique software platform. The Company’s fully API-enabled
solution allows clients to achieve time and cost savings by connecting their human resources workflow systems through
Directors
The following persons were directors of Xref Limited during the whole of the financial year and up to the date of this
report, unless otherwise stated:
Brad Rosser (Chairman)
Lee-Martin Seymour
Timothy Griffiths
Timothy Mahony
Nigel Heap
Principal activities
the internet.
During this financial year, Xref improved its performance against three key business metrics that guide the Company’s
global growth and progress towards profitability – client acquisition, client adoption and AveARPA)
Client acquisition strengthened and, at 30 June 2018, more than 750 direct paying clients were using our services
globally. Use of integrations to access Xref also more than doubled in the final quarter of FY18 alone and at the end of the
financial year 136 clients use our platform through channel partners.
Client adoption increases over time. It is measured by comparing the use of Xref credits as a percentage of a client
organisation’s total expected hires over a year. 45% of sales revenue was derived from new clients in FY18. Adoption rates
for these new clients is already 29%. For clients in their second, third and fourth years adoption rates have grown to 32%,
58% & 89% respectively. Overall client adoption was 38% at the end of the financial year.
During the financial year the consolidated entity continued to conduct its core activity which was to develop human
resources technology that automates the candidate reference process for employers.
Average Revenue Per Account of new clients acquired during FY18 was $8.4k, while for clients in their second, third
and fourth year their ARPA has grown to $9.5k, $12.5k & $17.9k respectively. Overall ARPA has grown to $10k.
Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
Large addressable market
Result
Clients across APAC, EMEA and North America are serviced from offices in Sydney, London, Toronto and, from September
2017, Oslo. The decision to introduce a physical presence in Oslo came in response to unsolicited demand for the Xref
The loss for the consolidated entity after providing for income tax amounted to $8,912,898, and was within management
service in the region. Xref has a large addressable market, including more than 180 million people in North America, 120
expectations (30 June 2017: $6,457,005).
Review of operations
million people in Europe, and 15 million people in Australia and New Zealand.
Technology improvement
Xref achieved strong sales growth during FY18 as it continued to invest for future growth.
The power of Xref’s platform increased in FY18 adding new features and updates including report branding, enhanced
HIGHLIGHTS OF THE FINANCIAL YEAR INCLUDED:
>
Sales - $7.1 million, up 72% from $4.1 million in FY17 with strong growth across Australia, New Zealand, Europe
and North America. Sales cycle improved by 55%, reducing from 80 days to 39 days.
> Recognised Revenue - increased 63% to $4.8 million from $2.9 million in FY17.
data analytics, enterprise security, GDPR compliance and improved user management features. The Company is also
introducing products that present new revenue opportunities, including People Search, a separate paid platform that
helps employers identify potential passive candidates in their existing referee data.
Xref’s partner channels expand
Collaboration with partners helps increase Xref’s channels to market, and the company has focused on introducing
> Client Acquisition - continued to strengthen. At year end more than 750 direct paying clients were using Xref’s
integrations with some of the world’s leading HR technology providers to build new business. These software systems are
services globally, excluding those accessing the platform via a partner network.
> Average Revenue Per Account (ARPA) - increased as a result of growing platform adoption.
> Offices - Oslo office opened to service the Nordic region.
used by enterprises to manage talent acquisition. Sales via channel partners increased to contribute over 20% of the total
sales in FY18, assisted by joint marketing campaigns with partners and other initiatives. Xref currently has 13 ‘live’ partners
that support more than 50,000 organisations worldwide, and the number is growing. Integrations increase adoption, and
a public API was launched to allow third-party organisations to connect with Xref’s platform more efficiently.
>
Integration Partners - more than doubled to 13, including some of the world’s leading applicant tracking
systems. Landmark partnership with San Francisco-based Checkr, enabling North American background checks
Finance and corporate
via the Xref platform.
Cash outflows were within management expectations as the Company continued to build global scale. The net loss for the
> Platform - new features and products, including Sentiment and People Search and public API to expedite third-
year was $8,912,898.
party integrations.
>
Funding - successful capital raising of $7.5 million in August 2017.
In July 2017 and March 2018, the Company invited eligible employees to participate in the Xref Employee Option plan.
10 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 11
DIRECTORS’ REPORT / Continued
DIRECTORS’ REPORT / Continued
Following 100% acceptance of the offer on both occasions, 1,055,449 and 2,749,782 new employee share options were
issued.
Name:
Title:
Timothy Griffiths
Chief Technology Officer
In August 2017, Xref completed a $7.5 million capital raising which closed oversubscribed.
Qualifications:
MBA
In September 2017, Xref opened its office in Oslo, Norway to service the Nordic region.
Experience and expertise:
While Xref’s business has always been headquartered in Australia, the company moved its domicile from New Zealand to
Australia on 21 September 2017.
In March 2018, executive directors Lee-Martin Seymour and Tim Griffiths sold 9,847,517 and 9,847,516 shares respectively,
to meet demand from institutional investors. Following completion of the sale, they have entered into a voluntary
agreement with Xref which restricts any further sale of shares before the announcement of the company’s FY19 results
(i.e. September 2019).
Matters subsequent to the end of the financial year
In August 2018, the Board gave approval to issue further invitations to eligible employees to participate in the Xref
Employee Option plan. Should 100% of the invitations be accepted 1,275,569 new employee share options will be issued
No other adjusting or significant non-adjusting events have occurred between the reporting date and the date of
authorisation.
Likely developments and expected results of operations
Xref anticipates continued growth across all business metrics and, with a strong pipeline of new business opportunities
across all the markets within which it operates, we are confident about the year ahead.
Environmental regulation
The consolidated entity is not subject to any significant environmental regulation under Australian Commonwealth or
State law.
Information on directors
Name:
Title:
Lee-Martin Seymour
Managing Director and Chief Executive Officer
Qualifications:
None
Experience and expertise:
Lee-Martin Seymour is a co-founder of Xref. He has 18 years recruitment
experience across many geographic and market sectors. For 12 years Lee
worked for one of the world’s largest specialist recruitment companies.
As a result he understands the demands of the employment market and
is passionate about pioneering positive change for the long term. As a
serial entrepreneur Lee has identified and successfully leveraged market
opportunities to aid innovation in the employment sector.
Other current directorships:
None
Former directorships (last 3 years):
None
Special responsibilities:
Member of the Remuneration & Nomination Committee
Interests in shares:
30,857,612 ordinary shares
Interests in options:
None
Contractual rights to shares:
8,333,333 performance rights
Timothy Griffiths is a co-founder of Xref. Mr Griffiths, an MBA-qualified
technologist, has 21 years’ experience advising companies, including Virgin
and SkyTV. He worked for Benchmark Capital providing technical diligence
for high tech start-up investment and was co-founder of media company
a2a plc, which floated on the UK stock market. More recently Tim was CIO
for Jcurve Solutions, an Australian cloud NetSuite ERP provider.
Other current directorships:
None
Former directorships (last 3 years):
None
Special responsibilities:
None
Interests in shares:
30,857,613 ordinary shares
Interests in options:
None
Contractual rights to shares:
8,333,333 performance rights
Name:
Title:
Qualifications:
Experience and expertise:
Brad Rosser
Chairman
BCom, MBA
Brad Rosser is a business builder and entrepreneur who worked for
McKinsey and Co from 1992 to 1995 before working directly for Richard
Branson as Director of Corporate Development for Virgin from 1995 to
1999, helping to identify and implement start-up businesses. He holds an
MBA from Cornell University’s Johnson Graduate School of Management
and a Bachelor of Commerce (Honours) from the University of Western
Australia.
Other current directorships:
None
Former directorships (last 3 years):
None
Special responsibilities:
Member of the Audit & Risk Committee and member of the Remuneration
& Nomination Committee
Interests in shares:
Interests in options:
None
7,000,000
Contractual rights to shares:
None
12 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 13
DIRECTORS’ REPORT / Continued
DIRECTORS’ REPORT / Continued
Name:
Title:
Tim Mahony
Non-Executive Director
Qualifications:
BFinAdmin
Key Management Personnel
Chief Financial Officer
Mr James Solomons, BComm, FCA, CTA, GAICD
Experience and expertise:
Timothy Mahony spent 18 years in investment banking, specialising in
capital markets and debt trading. Tim has been involved, as investor or
founder, in a number of technology start ups, either successfully exiting
the business or growing the business to a mature growth phase. He is a
founder and director of Globalx Information, a digital information company
providing information, software and services to the legal, corporate and
spatial markets throughout Australia and the UK.
James is a chartered accountant with over 18 years of experience within the accounting & corporate finance industry. He
has held various roles within the sector and has positioned himself as a leader in the accounting technology space bringing
with him to Xref over 3 years of experience as Xero Australia’s Head of Accounting. A successful entrepreneur in his own
right James has a deep understanding of the need to find a balance between investing for growth whilst maintaining
strong corporate governance processes across the business.
Other current directorships:
None
Former directorships (last 3 years):
None
Special responsibilities:
Member of the Audit & Risk Committee and member of the Remuneration
& Nomination Committee
Interests in shares:
1,650,000 ordinary shares
Interests in options:
Contractual rights to shares:
900,000
None
Name:
Title:
Nigel Heap
Non-Executive Director
Qualifications:
LLB,AMP
Experience and expertise:
Nigel Heap is the UK Ireland Managing Director, and Chairman of the Asia
Pacific business, of Hays plc, the leading global professional recruitment
group, and a member of the group’s management board. He joined Hays
in 1988 and over the last 20 years has successfully led the growth of the
Asia-Pacific business. He has completed INSEAD’s Advanced Management
Program and holds a Bachelor of Laws from Manchester University.
Other current directorships:
Hays UK Ltd
Former directorships (last 3 years):
None
Special responsibilities:
Member of the Audit & Risk Committee
Interests in shares:
18,000 ordinary shares
Interests in options:
Contractual rights to shares:
900,000
None
Company Secretary
Mr Robert Waring, BEc, ACA, FCIS, ASIA, FAICD
Robert has over 40 years of experience in financial and corporate roles, including more than 25 years in company secretarial
roles for ASX-listed companies. He is a director of Oakhill Hamilton Pty Ltd, a company that provides secretarial and
corporate advisory services to a range of listed and unlisted companies. He is also the Company Secretary of ASX-listed
companies Aeris Environmental Ltd, Vectus Biosystems Limited and Cobalt Blue Holdings Limited.
Meetings of directors
The number of meetings of the company’s Board of Directors (‘the Board’) and of each Board committee held during the
year ended 30 June 2018, and the number of meetings attended by each director were:
Full Board
Nomination and
Remuneration Committee
Audit and Risk Committee
Attended
Held
Attended
Held
Attended
Held
Lee-Martin Seymour
Timothy Griffiths
Timothy Mahony
Nigel Heap
Brad Rosser
8
7
8
8
7
8
8
8
8
8
1
-
2
-
2
2
-
2
-
2
-
2
2
1
-
-
2
2
2
1
Held: represents the number of meetings held during the time the director held office or was a member of the relevant
committee.
‘Other current directorships’ quoted above are current directorships for listed entities only and excludes directorships of
Remuneration report (audited)
all other types of entities, unless otherwise stated.
‘Former directorships (last 3 years)’ quoted above are directorships held in the last 3 years for listed entities only and
excludes directorships of all other types of entities, unless otherwise stated.
The remuneration report details the key management personnel remuneration arrangements for the consolidated entity,
in accordance with the requirements of the Corporations Act 2001 and its Regulations.
Key management personnel are those persons having authority and responsibility for planning, directing and controlling
the activities of the entity, directly or indirectly, including all directors.
14 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 15
DIRECTORS’ REPORT / Continued
DIRECTORS’ REPORT / Continued
The remuneration report is set out under the following main headings:
Non-executive directors remuneration
> Principles used to determine the nature and amount of remuneration
> Details of remuneration
>
>
Service agreements
Share-based compensation
> Additional disclosures relating to key management personnel
Principles used to determine the nature and amount of remuneration
Fees and payments to non-executive directors reflect the demands and responsibilities of their role. Non-executive
directors’ fees and payments are reviewed annually by the Nomination and Remuneration Committee. The Nomination
and Remuneration Committee may, from time to time, receive advice from independent remuneration consultants to
ensure non-executive directors’ fees and payments are appropriate and in line with the market. The chairman’s fees are
determined independently to the fees of other non-executive directors based on comparative roles in the external market.
The chairman is not present at any discussions relating to the determination of his own remuneration.
ASX listing rules require the aggregate Non-Executive Directors’ remuneration be determined periodically by a general
meeting. In the Prospectus dated 23th December 2015, noted on Page 18 the current maximum annual aggregate
The objective of the consolidated entity’s executive reward framework is to ensure reward for performance is competitive
remuneration for directors was shown as $200,000. This has changed and a resolution was passed at the 2016 AGM that
and appropriate for the results delivered. The framework aligns executive reward with the achievement of strategic
the maximum aggregate cash-based remuneration payable to Non Executive Directors in any financial year be increased
objectives and the creation of value for shareholders, and it is considered to conform to the market best practice for the
by A$300,000 from A$200,000 to A$500,000.
delivery of reward. The Board of Directors (‘the Board’) ensures that executive reward satisfies the following key criteria
for good reward governance practices:
>
>
competitiveness and reasonableness
acceptability to shareholders
Executive remuneration
The consolidated entity aims to reward executives based on their position and responsibility, with a level and mix
of remuneration which has both fixed and variable components.
> performance linkage / alignment of executive compensation
The executive remuneration and reward framework has four components:
The Nomination and Remuneration Committee is responsible for determining and reviewing remuneration arrangements
for its directors and executives. The performance of the consolidated entity depends on the quality of its directors and
executives. The remuneration philosophy is to attract, motivate and retain high performance and high quality personnel.
> base pay and non-monetary benefits
>
>
short-term performance incentives
share-based payments
The reward framework is designed to align executive reward to shareholders’ interests. The Board have considered that it
should seek to enhance shareholders’ interests by:
> having economic profit as a core component of plan design
>
>
>
focusing on sustained growth in shareholder wealth, consisting of dividends and growth in share price, and
delivering constant or increasing return on assets as well as focusing the executive on key non-financial drivers of
value
attracting and retaining high calibre executives
increasing return on assets as well as focusing the executive on key non-financial drivers of value
Additionally, the reward framework should seek to enhance executives’ interests by:
>
>
rewarding capability and experience
reflecting competitive reward for contribution to growth in shareholder wealth
> providing a clear structure for earning rewards
In accordance with best practice corporate governance, the structure of non-executive director and executive director
remuneration is separate.
> other remuneration such as superannuation and long service leave
The combination of these comprises the executive’s total remuneration.
Fixed remuneration, consisting of base salary, superannuation and non-monetary benefits, are reviewed annually by the
Nomination and Remuneration Committee based on individual and business unit performance, the overall performance
of the consolidated entity and comparable market remunerations.
Executives may receive their fixed remuneration in the form of cash or other fringe benefits (for example motor vehicle
benefits) where it does not create any additional costs to the consolidated entity and provides additional value to the
executive.
The short-term incentives (‘STI’) program is designed to align the targets of the business units with the performance
hurdles of executives. STI payments are granted to executives based on specific annual targets and key performance
indicators (‘KPI’s’) being achieved. KPI’s include profit contribution, customer satisfaction, leadership contribution and
product management.
The long-term incentives (‘LTI’) include long service leave and share-based payments. Shares are awarded to executives
over a period of three years based on long-term incentive measures. These include increase in shareholders value relative
to the entire market and the increase compared to the consolidated entity’s direct competitors.
The Company’s 2018 Annual Meeting (“AGM”)
A Remuneration Report has been prepared for the 2018 year and a resolution will be put to the 2018 AGM to ask
shareholders to approve it.
16 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 17
DIRECTORS’ REPORT / Continued
DIRECTORS’ REPORT / Continued
Details of remuneration
Amounts of remuneration
Details of the remuneration of key management personnel of the consolidated entity are set out in the following tables.
The key management personnel of the consolidated entity consisted of the following directors of Xref Limited:
>
>
>
Lee-Martin Seymour – Managing Director & Chief Executive Officer
Timothy Griffiths – Executive Director & Chief Technology Officer
Timothy Mahony – Non-Executive Director
> Nigel Heap – Non-Executive Director
> Brad Rosser – Chairman
And the Key Management Personnel:
>
James Solomons – Chief Financial Officer
> Robert Waring – Company Secretary
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-
based
payments
Cash
salary and
fees
Cash
bonus
Non-
monetary
Super-
annuation
2018
$
$
Non-Executive
Directors:
Brad Rosser
Tim Mahony
Nigel Heap
149,081
51,815
55,000
-
-
-
Executive Directors:
Lee-Martin Seymour
271,167
25,000
Timothy Griffiths
270,000
25,000
Other Key
Management
Personnel:
James Solomons
270,000
25,000
Robert Waring
64,732
-
1,131,795
75,000
$
-
-
-
-
-
-
-
-
$
-
-
-
23,750
23,750
23,750
-
71,250
Long
service
leave
Equity-
settled
$
$
Total
$
-
-
-
-
-
-
-
-
373,027
522,108
9,042
60,857
35,576
90,576
-
-
319,917
318,750
103,107
421,857
3,628
68,360
524,380
1,802,425
Short-
term
benefits
Post-
employment
benefits
Short-
term
benefits
Post-
employment
benefits
Long-term
benefits
Share-
based
payments
Cash bonus
Non-
monetary
Super-
annuation
Cash
salary and
fees
$
12,500
125,032
54,555
47,755
2017
Non-Executive
Directors:
Simon O’Loughlin
(Chairman) *
Brad Rosser
(Chairman)**
Timothy Mahony
Nigel Heap **
Executive
Directors:
Lee-Martin
Seymour
$
-
-
-
-
250,000
41,450
Timothy Griffiths
250,000
41,450
Other Key
Management
Personnel:
James Solomons
209,644
41,450
Robert Waring
71,715
-
1,021,201
124,350
* Represents remuneration from 1 July 2016 to 18 August 2016
** Represents remuneration from 18 August 2016 to 30 June 2017
Long
service
leave
Equity-
settled
$
$
Total
$
-
-
-
-
-
-
-
-
-
-
12,500
292,232
417,264
15,300
69,855
55,921
103,676
-
-
-
-
313,300
313,300
269,987
71,715
363,453
1,571,597
$
-
-
-
-
-
-
-
-
-
$
-
-
-
-
21,850
21,850
18,893
-
62,593
18 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 19
DIRECTORS’ REPORT / Continued
DIRECTORS’ REPORT / Continued
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Name:
Title:
Timothy Griffiths
Executive Director and Chief Technology Officer
Name
2018
2017
2018
2017
2018
2017
Term of agreement:
No fixed term
Fixed remuneration
At risk - STI
At risk - LTI
Agreement commenced:
1 July 2017
Non-Executive Directors:
Simon O’Loughlin (Chairman)
Brad Rosser (Chairman)
Timothy Mahony
Nigel Heap
Executive Directors:
Lee-Martin Seymour
Timothy Griffiths
Other Key Management
Personnel:
James Solomons
Robert Waring
-
100%
100%
100%
100%
100%
100%
100%
92%
92%
87%
87%
92%
100%
85%
100%
-
-
-
-
8%
8%
8%
-
-
-
-
-
13%
13%
15%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Details:
Name:
Title:
Base salary for the year ending 30 June 2018 of $250,000 per annum, plus
superannuation, plus $20,000 car allowance to be reviewed annually by the
Nomination and Remuneration Committee. 1 month termination notice by either
party. Discretionary bonus may be paid as per Nomination and Remuneration
Committee approval and KPI achievement. Non-solicitation and non- compete
clauses exist.
James Solomons
Chief Financial Officer
Agreement commenced:
1 July 2017
Term of agreement:
No fixed term
Details:
Base salary for the year ending 30 June 2018 of $250,000 per annum, plus
superannuation, plus $20,000 car allowance to be reviewed annually by the
Nomination and Remuneration Committee. 1 month termination notice by either
party. Discretionary bonus may be paid as per Nomination and Remuneration
Committee approval and KPI achievement along with ability to receive options in Xref
Limited. Non-solicitation and non-compete clauses exist.
Key management personnel have no entitlement to termination payments in the event of removal for misconduct.
Share-based compensation
Options
Cash bonuses are dependent on meeting defined performance measures. The amount of the bonus is determined having
regard to the satisfaction of performance measures and weightings as described above in the section ‘Consolidated entity
The terms and conditions of each grant of options over ordinary shares affecting remuneration of directors and other key
performance and link to remuneration’. The maximum bonus values are established at the start of each financial year and
management personnel in this financial year or future reporting years are as follows:
amounts payable are determined in the final month of the financial year by the Nomination and Remuneration Committee.
Service agreements
Remuneration and other terms of employment for key management personnel are formalised in service agreements.
Details of these agreements are as follows:
Name:
Title:
Lee-Martin Seymour
Managing Director and Chief Executive Officer
Agreement commenced:
1 July 2017
Term of agreement:
No fixed term
Details:
Base salary for the year ending 30 June 2018 of $250,000 per annum, plus
superannuation, plus $20,000 car allowance to be reviewed annually by the
Nomination and Remuneration Committee. 1 month termination notice by either
party. Discretionary bonus may be paid as per Nomination and Remuneration
Committee approval and KPI achievement. Non-solicitation and non- compete
clauses exist.
Grant date
Vesting date and
exercisable date
Expiry date
Exercise
price
at grant
date
Fair value
per option
26 September 2017
22 March 2018
22 March 2018
22 March 2018
3/7/18
12/2/18
12/2/19
12/2/20
3 July 2021
1 February 2021
12 February 2022
12 February 2023
$0.58
$0.70
$0.70
$0.70
$0.3162
$0.0697
$0.0928
$0.1120
Options granted carry no dividend or voting rights.
20 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 21
DIRECTORS’ REPORT / Continued
DIRECTORS’ REPORT / Continued
All options were granted over unissued fully paid ordinary shares in the company. The number of options granted was
Performance rights
determined having regard to the satisfaction of performance measures and weightings as described above in the section
‘Consolidated entity performance and link to remuneration’. Options vest based on the provision of service over the
vesting period whereby the executive becomes beneficially entitled to the option on vesting date. Options are exercisable
by the holder as from the vesting date. There has not been any alteration to the terms or conditions of the grant since the
grant date. There are no amounts paid or payable by the recipient in relation to the granting of such options other than
on their potential exercise.
The number of options over ordinary shares granted to and vested by directors and other key management personnel as
part of compensation during the year ended 30 June 2018 are set out below:
Name
2018
2017
2018
2017
Number
of options
granted
during the
year
Number
of options
granted
during the
year
Number
of options
vested
during the
year
Number
of options
vested
during the
year
Tim Mahony
Nigel Heap
Brad Rosser
James Solomons
Robert Waring
-
-
-
-
300,000
300,000
900,000
300,000
300,000
7,000,000
2,000,000
2,500,000
16,312
-
-
1,000,000
-
-
-
-
Values of options over ordinary shares granted, exercised and lapsed for directors and other key management personnel
as part of compensation during the year ended 30 June 2018 are set out below:
Name
James Solomons
Robert Waring
Value of
options
granted
during the
year
Value of
options
exercised
during the
year
Value of
options
lapsed
during the
year
Remuneration
consisting of
options for the
year
$
223,328
3,667
$
-
-
$
-
-
%
24%
5%
There were no performance rights over ordinary shares issued to directors and other key management personnel as part
of compensation that were outstanding as at 30 June 2018.
There were no performance rights over ordinary shares granted to or vested by directors and other key management
personnel as part of compensation during the year ended 30 June 2018.
Additional disclosures relating to key management personnel
Shareholding
The number of shares in the company held during the financial year by each director and other members of key
management personnel of the consolidated entity, including their personally related parties, is set out below:
Balance at
the start of
the year
Received
as part of
remuneration
Additions
Disposals/
other
Balance at
the end of
the year
1,650,000
18,000
32,371,795
32,371,796
9,000
213,885
66,634,476
-
-
-
-
-
-
-
-
-
-
-
1,650,000
18,000
8,333,334
(9,847,517)
30,857,612
8,333,333
(9,847,516)
30,857,613
-
-
-
-
9,000
213,885
16,666,667
(19,695,033)
63,606,110
Ordinary shares
Timothy Mahony
Nigel Heap
Lee-Martin Seymour
Timothy Griffiths
James Solomons
Robert Waring
Option holding
The number of options over ordinary shares in the company held during the financial year by each director and other
members of key management personnel of the consolidated entity, including their personally related parties, is set out
below:
Options over ordinary shares
Brad Rosser
Timothy Mahony
Nigel Heap
James Solomons
Robert Waring
Balance at
the start of
the year
7,000,000
900,000
900,000
-
-
-
-
-
2,500,000
16,312
8,800,000
2,516,312
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
-
-
-
-
-
-
-
-
-
-
-
-
7,000,000
900,000
900,000
2,500,000
16,312
11,316,312
22 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 23
DIRECTORS’ REPORT / Continued
DIRECTORS’ REPORT / Continued
Other transactions with key management personnel and their related parties
Non-audit services
During the financial year;
Payments for accounting services from Verve Solutions Pty Ltd (related entity of James Solomons) of $154,154 (ex GST)
were made.
Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the
auditor are outlined in note 10 to the financial statements.
The directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another
person or firm on the auditor’s behalf), is compatible with the general standard of independence for auditors imposed by
Payments for company secretarial services from Oakhill Hamilton Pty Ltd (related entity of Robert Waring) of $64,732 (ex
the Corporations Act 2001.
GST) were made.
All transactions were made on normal commercial terms and conditions and at market rates.
external auditor’s independence requirements of the Corporations Act 2001 for the following reasons:
The directors are of the opinion that the services as disclosed in note 10 to the financial statements do not compromise the
Performance Rights
Lee-Martin Seymour had A Class Performance Rights converted into 8,333,334 fully paid ordinary shares after the
achievement of the performance milestones set out in the conversion events, as approved by shareholders at the 26
November 2015 EGM, and as detailed in the terms and conditions of the Company’s B Class Performance Rights released
to ASX on 4 December 2017. As at the date of this report there is a balance of 8,333,333 Performance Rights available for
Lee-Martin Seymour.
Timothy Griffiths had A Class Performance Rights converted into 8,333,333 fully paid ordinary shares after the achievement
of the performance milestones set out in the conversion events, as approved by shareholders at the 26 November 2015
EGM, and as detailed in the terms and conditions of the Company’s B Class Performance Rights released to ASX on 4
December 2017. As at the date of this report there is a balance of 8,333,333 Performance Rights available for Timothy
Griffiths.
This concludes the remuneration report, which has been audited.
Indemnity and insurance of officers
>
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.
Rounding of amounts
The company is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities and
Investments Commission, relating to ‘rounding-off’. Amounts in this report have been rounded off in accordance with
that Corporations Instrument to the nearest thousand dollars, or in certain cases, the nearest dollar.
Auditor’s independence declaration
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out
immediately after this directors’ report.
The company has indemnified the directors and executives of the company for costs incurred, in their capacity as a director
Corporate Governance
or executive, for which they may be held personally liable, except where there is a lack of good faith.
During the financial year, the company paid a premium in respect of a contract to insure the directors and executives of
the company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits
disclosure of the nature of the liability and the amount of the premium.
The Group’s Corporate Governance Statement and Appendix 4G checklist are released to ASX on the same day the
Annual Report is released. The Corporate Governance Statement and Corporate Governance Manual can be found on the
Company’s website at https://xref.com/en/investor-centre/.
This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act 2001.
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.
On behalf of the directors
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.
Proceedings on behalf of the company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf
of the company, or to intervene in any proceedings to which the company is a party for the purpose of taking responsibility
on behalf of the company for all or part of those proceedings.
Lee-Martin Seymour
Brad Rosser
Managing Director
Chairman
29 August 2018
24 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 25
Independence
Declaration
Financial
Statements
Statement of profit or loss and other comprehensive income for the year ended 30 June 2018
Revenue
Sales - Credits Sold in Current Year
Less adjustment for Unearned Revenue
Other income
Expenses
Employee expenses
Overheads and administrative expenses
Depreciation, amortisation and impairment expenses
Loss before income tax expense from continuing operations
Income tax expense
Loss after income tax expense from continuing operations
Loss after income tax expense from discontinued operations
Loss after income tax expense for the year attributable to the
owners of Xref Limited
Other comprehensive income
Note
Consolidated
2018
$
2017
$
9
13
10
11
14
8
7,071,723
4,107,518
(2,225,723)
(1,127,069)
4,846,000
2,980,449
1,849,140
1,437,665
(9,170,013)
(5,418,895)
(6,359,098)
(5,409,076)
(78,927)
(46,181)
(8,912,898)
(6,456,038)
-
-
(8,912,898)
(6,456,038)
-
(967)
(8,912,898)
(6,457,005)
Items that may be reclassified subsequently to profit or loss
Foreign currency translation
(205,147)
(51,862)
Other comprehensive income for the year, net of tax
(205,147)
(51,862)
Total comprehensive income for the year attributable to the
owners of Xref Limited
(9,118,045)
(6,508,867)
Total comprehensive income for the year is attributable to:
Continuing operations
Discontinued operations
(9,118,045)
(6,507,900)
-
(967)
(9,118,045)
(6,508,867)
26 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 27
FINANCIAL STATEMENTS / For the Year Ended 30 June 2018
FINANCIAL STATEMENTS / For the Year Ended 30 June 2018
Statement of profit or loss and other comprehensive income for the year ended 30 June 2018
(continued)
Statement of financial position as at 30 June 2018
Note
Consolidated
2018
$
Cents
2017
$
Cents
Earnings per share for loss from continuing operations attributable
to the owners of Xref Limited
Basic earnings per share
Diluted earnings per share
26
26
(6.39)
(6.39)
(6.13)
(6.13)
Earnings per share for profit from discontinued operations
attributable to the owners of Xref Limited
Basic earnings per share
Diluted earnings per share
Earnings per share for loss attributable to the owners of Xref Limited
N/A
N/A
0.00
0.00
The above statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Prepayments
Total current assets
Non-current assets
Property, plant and equipment
Intangibles
Rental Bonds
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Employee Entitlements
Superannuation payable
Lease Incentive
Unearned Revenue
Total current liabilities
Non-current liabilities
Employee entitlements
Lease Incentive
Total non-current liabilities
Total liabilities
Net assets
Note
Consolidated
2018
$
2017
$
15
16
17
18
19
20
4,451,896
4,069,573
3,144,727
2,616,084
229,886
192,620
7,826,509
6,878,277
322,105
117,953
120,196
212,357
101,681
74,998
560,254
389,036
8,386,763
7,267,313
1,646,024
1,641,502
277,529
184,268
13,103
162,725
115,258
31,512
21
4,268,871
2,030,253
6,389,795
3,981,250
22
52,622
-
52,622
22,436
13,103
35,539
6,442,417
4,016,789
1,944,346
3,250,524
28 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 29
FINANCIAL STATEMENTS / For the Year Ended 30 June 2018
FINANCIAL STATEMENTS / For the Year Ended 30 June 2018
Statement of financial position as at 30 June 2018 (continued)
Equity
Issued capital
Other equity reserves
Accumulated losses
Total equity
Note
Consolidated
2018
$
2017
$
23
24
40,087,991
32,687,991
(21,754,920)
(21,961,640)
(16,388,725)
(7,475,827)
1,944,346
3,250,524
The above statement of financial position should be read in conjunction with the accompanying notes
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30 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 31
FINANCIAL STATEMENTS / For the Year Ended 30 June 2018
FINANCIAL STATEMENTS / For the Year Ended 30 June 2018
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Statement of cash flows for the year ended 30 June 2018
Cash flows from operating activities
Receipts from customers (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Interest received
Other revenue
Notes
Consolidated
2018
$
2017
$
7,207,058
3,524,328
(15,523,197)
(9,631,070)
(8,316,139)
(6,106,742)
117,452
53,031
1,731,688
482,426
Net cash used in operating activities
28
(6,466,999)
(5,571,285)
Cash flows from investing activities
Payments for property, plant and equipment
Payments for intangibles
Cash from loans to other entities
Proceeds from disposal of property, plant and equipment
17
18
(184,406)
(119,804)
(16,272)
-
-
-
31,416
233
Net cash used in investing activities
(200,678)
(88,155)
Cash flows from financing activities
Proceeds from issue of shares
Share issue transaction costs
Net cash from financing activities
Net increase in cash and cash equivalents
23
23
7,500,000
8,000,000
(450,000)
(540,000)
7,050,000
7,460,000
382,323
1,800,560
Cash and cash equivalents at the beginning of the financial year
4,069,573
2,270,832
Effects of exchange rate changes on cash and cash equivalents
-
(1,819)
Cash and cash equivalents at the end of the financial year
15
4,451,896
4,069,573
32 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 33
Notes to the
Financial Statements
NOTES TO THE FINANCIAL STATEMENTS / continued
1. Reporting entity
Xref Limited is a limited liability company incorporated on 28 January 2003 and as at 21 September 2017 is domiciled in
Australia. The address of its registered office is Unit 14, 13 Hickson Road, Dawes Point, New South Wales, Australia 2000.
Xref is a human resources technology company that automates the candidate reference process for employers.
The Group re-assesses whether or not it controls another entity if facts and circumstances indicate that there are changes
in one or more of the three elements of control. The financial statements of subsidiaries are included in the preliminary
consolidated financial statements from the date that control commences until the date that control ceases.
The consolidation of the Parent and subsidiary entities involves adding together like terms of assets, liabilities, income
and expenses on a line-by-line basis. All significant intra-group balances are eliminated on consolidation of Group financial
2. Basis of preparation
position, performance and cash flows.
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards
and Interpretations issued by the Australian Accounting Standards Board (‘AASB’) and the Corporations Act 2001, as
appropriate for for-profit oriented entities. These financial statements also comply with International Financial Reporting
Standards as issued by the International Accounting Standards Board (‘IASB’).
a. Historical cost convention
A change in the ownership interest of a subsidiary that does not result in a loss of control, is accounted for as an equity
transaction - that is, as transactions with owners in their capacity as owners, recorded in the statement of movements in
equity.
If the Group loses control over a subsidiary, it:
The financial statements have been prepared under the historical cost convention, except for, where applicable, the
revaluation of available-for-sale financial assets, financial assets and liabilities at fair value through profit or loss, investment
> derecognises the assets (including goodwill) and liabilities of the subsidiary;
> derecognises the carrying amount of any non-controlling interest;
properties, certain classes of property, plant and equipment and derivative financial instruments.
> derecognises the cumulative carrying amount of foreign currency translation; differences recorded in reserves;
b. Critical accounting estimates
The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of applying the consolidated entity’s accounting policies. The areas
involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the
financial statements, are disclosed in note 5.
3. Significant accounting policies
>
>
>
>
>
recognises the fair value of the consideration received;
recognises the fair value of any investment retained;
recognises any surplus or deficit in profit or loss; and
reclassifies the parent’s share of components previously recognised in other comprehensive income to profit or
loss, or retained earnings as appropriate.
Interests in subsidiaries are held at cost less impairment in the Parent.
The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies
b. Foreign currency translation
have been consistently applied to all the years presented, unless otherwise stated.
The financial statements are presented in Australian Dollars, which is Xref Limited’s functional and presentation currency.
New or amended Accounting Standards and Interpretations adopted
The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board (‘AASB’) that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
Parent entity information
In accordance with the Corporations Act 2001, these financial statements present the results of the consolidated entity
only. Supplementary information about the parent entity is disclosed in note 32.
a. Basis of consolidation
The Group financial statements consolidate the financial statements of the Parent and all entities over which the Parent is
deemed to have controlling relationship (defined as “subsidiaries”). An entity is defined as a subsidiary when the Group
is exposed, or has rights to variable returns from its relationship with the entity and has the ability to affect those returns
through its power over the entity.
When the Group has less than a majority of the voting power or similar rights of another entity, the Group considers all
relevant facts and circumstances in assessing whether it has power over the other entity.
Foreign currency transactions
Foreign currency transactions are translated into the functional currency of the Parent, using exchange rates prevailing at
the dates of the transactions (i.e. the spot exchange rate). Foreign exchange gains and losses resulting from the settlement
of such transactions and from measurement of monetary items denominated in foreign currency at year-end exchange
rates are recognised in the reported profit or loss.
Non-monetary items measured at historical cost are not re-translated at each year-end, instead they are only translated
once using the exchange rate at the transaction date. Non-monetary items measured at fair value are translated using the
exchange rates at the date when the year-end fair value was determined.
The net balance of foreign exchange gains and losses that relate to monetary items (such as borrowings, cash and cash
equivalents) are presented in the Statement of Comprehensive Income within “finance income” or “finance costs”. All
other foreign exchange gains and losses are presented in the Statement of Comprehensive Income within “Other gains/
(losses)”.
34 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 35
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through profit
e. Trade creditors and other payables
and loss are recognised in the Statement of Comprehensive Income as part of the fair value gain or loss. Translation
differences on non-monetary financial assets, such as equities classified as available for sale, are included in fair value
movements disclosed within other comprehensive income.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business
from suppliers. Creditors are classified as current liabilities if payment is due within one year or less. If not, they are
presented as non-current liabilities.
Foreign operations
Trade creditors and other payables are recognised initially at fair value and subsequently measured at amortised cost
In the Group’s financial statements, all assets, liabilities and transactions of Group entities with a functional currency other
using the effective interest method.
than Australian Dollars are translated into Australian Dollars upon consolidation.
The results and financial position of subsidiaries are translated into the presentation currency as follows:
i. assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of
that statement of financial position;
f. Property, plant and equipment
Except for land and buildings, items of property, plant and equipment are measured at cost, less accumulated depreciation
and any impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset.
Subsequent costs and the cost replacing part of an item of property, plant and equipment is recognised as an asset if, and
ii. income and expenses for each statement of comprehensive income are translated at average exchange rates (unless
only if, it is probable that future economic benefits or service potential will flow to the Group and the cost of the item can
this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates,
be measured reliably. The carrying amount of the replaced part is derecognised.
in which case income and expenses are translated at the dates of the transactions); and
iii. all resulting exchange differences are recognised in other comprehensive income.
In most instances, an item of property, plant and equipment is recognised at its cost. Where an asset is acquired at no cost,
or for a nominal cost, it is recognised at fair value at the acquisition date.
The assets and liabilities of foreign operations, including any goodwill, are translated to AUDs at exchange rates at
All repairs and maintenance expenditure is charged to profit or loss in the year in which the expense is incurred.
the reporting date. The income and expenses of foreign operations, are translated to AUDs at exchange rates at the
dates of the transactions.
Foreign currency differences are recognised on other comprehensive income, and presented in the foreign currency
translation reserve within equity.
When a foreign operation is disposed of such that control is lost, the cumulative amount of the translation reserve related
to the foreign operation is reclassified to the reported surplus or deficit as part of the gain or loss on disposal.
c. Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held on call with banks, other short-term highly liquid investments
with original maturities of three months or less, and bank overdrafts.
d. Trade debtors and other receivables
When an item of property, plant or equipment is disposed of, the gain or loss recognised in the profit or loss is calculated
as the difference between the net sale proceeds and the carrying amount of the asset.
Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment
(excluding land) over their expected useful lives as follows:
Computer Equipment
Office Equipment
Office Furniture
Office Fit-out
3-5 years
3-20 years
10-20 years
6-20 years
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting
Trade debtors are amounts due from customers for goods sold and services performed in the ordinary course of business.
If collection is expected in one year or less, they are classified as current assets. If not, they are presented as non-current
date.
assets.
Trade debtors and other receivables are measured initially at fair value and subsequently measured at amortised cost
using the effective interest method, less provision for any impairment.
An allowance for impairment is established where there is objective evidence the Group will not be able to collect all
amounts due according to the original terms of the receivable.
Other receivables are recognised at amortised cost, less any provision for impairment.
Leasehold improvements and plant and equipment under lease are depreciated over the unexpired period of the lease or
the estimated useful life of the assets, whichever is shorter.
An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to
the consolidated entity. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or
loss. Any revaluation surplus reserve relating to the item disposed of is transferred directly to retained profits.
g. Intangible assets
Intangible assets acquired separately are initially recognised at cost. Indefinite life intangible assets are not amortised and
are subsequently measured at cost less any impairment. Finite life intangible assets are subsequently measured at cost
less amortisation and any impairment. The gains or losses recognised in profit or loss arising from the derecognition of
intangible assets are measured as the difference between net disposal proceeds and the carrying amount of the intangible
asset. The method and useful lives of finite life intangible assets are reviewed annually. Changes in the expected pattern of
consumption or useful life are accounted for prospectively by changing the amortisation method or period.
36 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 37
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
Internally developed intangible assets.
j. Financial instruments
Expenditure on research activities, undertaken with the prospect of gaining new technical knowledge and understanding,
is recognised in the reported profit or loss when incurred.
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity
instrument in another entity.
Development activities include a plan or design for the production of new or substantially improved products. Development
expenditure is capitalised only if development costs can be measured reliably, the product or process is technically and
commercially feasible, future economic benefits are probable, and the Group intends to and has sufficient resources
Financial instruments are comprised of trade debtors and other receivables, cash and cash equivalents, other financial
assets, trade creditors and other payables, borrowings, other financial liabilities and derivative financial instruments.
to complete development and to use or sell the asset. The expenditure capitalised includes the cost of materials, direct
Initial recognition and measurement
labour and overhead costs that are directly attributable to preparing the asset for its intended use. Other development
Financial assets and financial liabilities are recognised initially at fair value plus transaction costs attributable to the
expenditure is recognised in the reported surplus and deficit when incurred.
acquisition, except for those carried at fair value through profit or loss, which are measured at fair value.
Capitalised development expenditure is measured at cost less accumulated amortisation and any impairment losses.
Financial assets and financial liabilities are recognised when the Parent and Group becomes a party to the contractual
Patents and trademarks
Significant costs associated with patents and trademarks are deferred and amortised on a straight-line basis over the
De-recognition of financial instruments
provisions of the financial instrument.
period of their expected benefit, being their finite life of 10 years.
h. Leased assets
Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or if the
Group transfers the financial asset to another party without retaining control or substantial all risks and rewards of the
asset.
Leases where the Group assumes substantially all the risks and rewards incidental to ownership of the leased assets, are
classified as finance leases. All other leases are classified as operating leases.
A financial liability is derecognised when it is extinguished, discharged, cancelled or expires.
Payments made under operating leases are recognised in profit or loss on a straight-line basis over the term of the
Subsequent measurement of financial assets
lease. Lease incentives received are recognised as an integral part of the total lease expense, over the term of the lease.
The subsequent measurement of financial assets depends on their classification, which is primarily determined by the
Associated costs, such as maintenance and insurance, are expensed as incurred.
i.
Impairment of non-financial assets
At each reporting date, the carrying amounts of tangible and intangible assets are reviewed to determine whether there
is any indication of impairment. If any such indication exists for an asset, the recoverable amount of the asset is estimated
in order to determine the extent of the impairment loss.
Goodwill and other intangible assets with indefinite useful life are tested for impairment annually.
An impairment loss is recognised whenever the carrying amount of an asset exceeds is recoverable amount. Impairment
losses directly reduce the carrying amount of assets and are recognised in the reported profit or loss.
The estimated recoverable amount of an asset is the greater of their fair value less costs to sell and value in use. Value in
use is determined by estimating future cash flows from the use and ultimate disposal of the asset and discounting to their
present value using a pre-tax discount rate that reflects current market rates and risks specific to the asset. For an asset
that does not generate largely independent cash flows, the recoverable amount is determined for the cash-generating
unit to which the asset belongs.
An impairment loss in respect of goodwill is not reversed. Other impairment losses are reversed when there is a change in
the estimates used to determine the recoverable amount. An impairment loss on property carried at fair value is reversed
through the relevant reserve. All other impairment losses are reversed through profit or loss.
Any reversal of impairments previously recognised is limited so that the carrying amount of the asset does not exceed
its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no
impairment loss been recognised for the asset in prior years.
purpose for which the financial assets were acquired. Management determines the classification of financial assets at
initial recognition into one of four categories defined below, and re-evaluates this designation at each reporting date.
All financial assets except for those classified as fair value through profit or loss are subject to review for impairment at
least at each reporting date. Different criteria to determine impairment are applied to each category of financial assets,
which are described below.
The classification of financial instruments into one of the four categories below, determines the basis for subsequent
measurement and the whether any resulting movements in value are recognised in the reported profit/ loss or other
comprehensive income.
i. Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an
active market. After initial recognition, these are measured at amortised cost using the effective interest method, less
provision for impairment. Discounting is omitted where the effect of discounting is immaterial. The Group’s cash and cash
equivalents, trade and most other receivables fall into this category of financial instruments.
Individually significant receivables are considered for impairment when they are past due or when other objective evidence
is received that a specific counterparty will default. Receivables that are not considered to be individually impaired are
reviewed for impairment in groups, which are determined by reference to the industry and region of a counterparty and
other shared credit risk characteristics. The impairment loss estimate is then based on recent historical counterparty
default rates for each identified group.
38 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 39
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
ii. Financial assets at fair value through profit and loss
Termination benefits
Financial assets at fair value through profit or loss include financial assets that are either classified as held for trading or
that meet certain conditions and are designated at fair value through profit or loss upon initial recognition. All derivative
financial instruments fall into this category, except for those designated and effective as hedging instruments, for which
the hedge accounting requirements apply.
Termination benefits are recognised as an expense when the Group is committed without realistic possibility of
withdrawal, to terminate employment, or to provide termination benefits as a result of an offer made to encourage
voluntary redundancy. Termination benefits for voluntary redundancies are recognised as an expense if the Group has
made an offer of voluntary redundancy, it is probable that the offer will be accepted, and the number of acceptances can
be estimated reliably. If benefits are payable more than 12 months after the reporting date, then they are discounted to
Assets in this category are measured at fair value with gains or losses recognised in profit or loss. The fair values of non-
derivative financial instruments are determined by reference to active market transactions or using a valuation technique
where no active market exists.
their present value.
Long-term benefits
Equity investments are measured at cost less any impairment charges, where the fair value cannot currently be estimated
reliably.
When the asset is disposed of or is determined to be impaired the cumulative gain or loss recognised in other comprehensive
income is reclassified from the equity reserve to profit or loss and presented as a reclassification adjustment within other
comprehensive income. Any associated interest income or dividends are recognised in profit or loss within “finance
income”.
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the consolidated statement of financial
position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle
on a net basis, to realise the assets and settle the liabilities simultaneously.
k. Provisions
A provision is recognised for a liability when the settlement amount or timing is uncertain; when there is a present legal or
constructive obligation as a result of a past event; it is probable that expenditures will be required to settle the obligation;
and a reliable estimate of the potential settlement can be made. Provisions are not recognised for future operating losses.
A provision for onerous contracts is recognised when the expected benefits to be derived by the Group from a contract are
lower that the unavoidable cost of meeting its obligation under the contract.
The Group’s net obligation is respect of long service leave is the amount of future benefit that employees have earned in
return for their services in the current and prior years. The obligation is calculated using the projected unit credit method
and is discounted to its present value. Any actuarial gains and losses are recognised in profit or loss in the year in which
they arise.
Share-based payments
The Group operates an equity-settled, share-based compensation plan. The fair value of the employee services received
in exchange for the grant of the options is recognised as an expense. The total amount to be expensed over the vesting
period is determined by reference to the fair value of the options granted, excluding the impact of any non-market vesting
conditions (for example, profitability). Non-market vesting conditions are included in assumptions about the number of
options that are expected to become exercisable. At each reporting date, the entity revises its estimates of the number of
options that are expected to become exercisable. It recognises the impact of the revision of original estimates, if any, in
the statements of comprehensive income, and a corresponding adjustment to equity over the remaining vesting period. If
the options lapse or expire, the accumulated balance will be reclassified to retained earnings.
The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) when
the options are exercised.
m. Revenue
Revenue is recognised to the extent that it is probable that the economic benefit will flow to the Group and revenue can
be reliably measured. Revenue is measured at the fair value of consideration received, excluding GST, rebates, and trade
Provisions are measured at the estimated expenditure required to settle the present obligation, based on the most reliable
discounts.
evidence available at the reporting date, including the risks and uncertainties associated with the present obligation.
Provisions are discounted to their present values, where the time value of money is material. The increase in the provision
due to the passage of time is recognised as an interest expense.
Rendering of services
All provisions are reviewed at each reporting date and adjusted to reflect the current best estimate.
The Group sells candidate reference credits to its customers. When customers use a credit, the service has been performed
and revenue is recognised in the accounting periods in which the services are provided. Unused credits are recognised as
The following specific recognition criteria must be met before revenue is recognised:
l. Employee benefits
Short-term employee benefits
unearned income in the financial statements.
Interest income
Employee benefits, previously earned from past services, that the Group expect to be settled within 12 months of reporting
Interest income is recognised as it accrues, using the effective interest method.
date are measured based on accrued entitlements at current rate of pays.
n. Finance costs
These include salaries and wages accrued up to the reporting date and annual leave earned, but not yet taken at the
reporting date.
Finance costs recorded in the Statement of Comprehensive Income comprise the interest expenses charged on borrowings
and the unwinding of discounts used to measure the fair value of provisions.
The Group recognises a liability and an expense for bonuses where they are contractually obliged or where there is a past
practice that has created a constructive obligation.
40 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 41
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
o. Profit and loss from discontinued activities
q. Goods and Services Tax (GST)
A discontinued operation is a component of the entity that either has been disposed of, or is classified as held for sale, and:
All amounts in these financial statements are shown exclusive of GST, except for receivables and payables that are stated
>
>
>
represents a separate major line of business or geographical area of operations;
is part of a single co-ordinated plan to dispose of a separate major line of business; or geographical area of
operations; or
is a subsidiary acquired exclusively with a view to re-sale
The disclosures for discontinued operations in the prior year relate to all operations that have been discontinued by the
reporting date for the latest year presented. Where operations previously presented as discontinued are now regarded as
continuing operations, prior year disclosures are correspondingly re-presented.
p. Income tax
Current income taxes
Current tax is the amount of income tax payable based on the taxable surplus for the current year, plus any adjustment
to income tax payable in respect of prior years. Current tax is calculated using tax rates (and tax laws) that have been
enacted or substantially enacted at the reporting date.
Deferred tax
Deferred tax is the amount of income tax payable or recoverable in future years in respect of temporary differences and
unused tax losses (if any). Temporary differences are differences between the carrying amount of asset and liabilities in
the financial statements and the corresponding tax bases used in the consumption of taxable surpluses.
Deferred tax is not provided on the initial recognition of goodwill or on the initial recognition of an asset or liability,
unless the related transaction is a business combination or affects the tax or accounting profit. Deferred tax on temporary
differences associated with investments in subsidiaries and joint ventures is not provided if reversal of these temporary
differences can be controlled by the Group and it is probable that reversal will not occur in the foreseeable future.
Deferred tax assets are recognised to the extent that it is probable that taxable surpluses will be available in future years,
against which the deductible temporary differences or tax losses can be utilised.
Deferred tax is measured at the tax rates that are expected to apply when the asset is realised or the liability settled, based
inclusive of GST.
The net amount of GST recoverable from, or payable to the Australian Taxation Office (ATO), or tax offices in other
jurisdictions is included as part of receivables and / or payables in the Statement of Financial Position. GST balances from
different countries are not offset.
r. Share capital
Share capital represents the consideration received for shares that have been issued. All transaction costs associated with
the issuing of shares are recognised as a reduction in equity, net of any related income tax benefits.
s. Dividend distribution
Dividend distributions to the parent’s shareholders are recognised as a liability in the Group’s financial statements in the
period in which the dividends are approved by the Parent Directors.
t. Earnings per share
The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by
dividing the profit or loss attributable to ordinary shareholders of the Parent by the weighted average number of ordinary
shares outstanding during the year, adjusted for own shares held.
Diluted earnings per share is determined by adjusting the profit or loss attributable to ordinary shareholders and the
weighted average number of ordinary shareholders outstanding, adjusted for own shares held, for the effects of all dilutive
potential ordinary shares, which comprise convertible notes and share options granted to employees.
u. Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision-maker. The chief operating decision-maker, who is ultimately responsible for strategic decision, approving the
allocation of resources and assessing the performance of the operating segments, has been identified as the Board of
Directors.
v. Going Concern
on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date. The measurement of
Not withstanding the Group incurred a loss after tax for the year of $8,912,898 (2017: $6,457,005), the consolidated financial
deferred tax reflects the tax consequences that would follow from the manner in which the Group expects to recover the
statements have been prepared on a going concern basis as the Group has a net asset position of $1,944,346 (2017:
carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset only when the Group has a right and intention to set off current tax assets and
liabilities from the same taxation authority.
Changes in deferred tax assets or liabilities are recognised as a component of income tax in profit or loss, except where
they relate to items that are recognised in other comprehensive income or directly in equity, in which case the related
deferred tax is also recognised in other comprehensive income or equity, respectively.
$3,250,524). The Group has an expectation that the sum of its activities will result in a positive cash position as at 30 June
2019, although a trading deficit is predicted. The Group has been able to demonstrate in previous years that they have
been successful in raising capital when needed. In August 2017 $7.5 million was raised before costs. The Directors remain
confident that this can again be done when required to support the Groups continuing activities. The directors believe the
Group can support its operating activities and pay its debts when they fall due in the next 12 months and the foreseeable
future. As such the consolidated financial statements have been prepared on the going concern basis.
42 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 43
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
4. New Accounting Standards and Interpretations not yet mandatory or early adopted
5. Critical accounting judgements, estimates and assumptions
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet
The preparation of the financial statements requires management to make judgements, estimates and assumptions
mandatory, have not been early adopted by the consolidated entity for the annual reporting period ended 30 June 2018.
that affect the reported amounts in the financial statements. Management continually evaluates its judgements and
The consolidated entity’s assessment of the impact of these new or amended Accounting Standards and Interpretations,
estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements,
most relevant to the consolidated entity, are set out below.
AASB 15 Revenue from Contracts with Customers
This standard is applicable to annual reporting periods beginning on or after 1 January 2018. The standard provides a
single standard for revenue recognition. The core principle of the standard is that an entity will recognise revenue to
depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the
estimates and assumptions on historical experience and on other various factors, including expectations of future events,
management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates
will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the
next financial year are discussed below.
entity expects to be entitled in exchange for those goods or services. The standard will require: contracts (either written,
Share-based payment transactions
verbal or implied) to be identified, together with the separate performance obligations within the contract; determine the
The consolidated entity measures the cost of equity-settled transactions with employees by reference to the fair value of
transaction price, and recognition of revenue when each performance obligation is satisfied. The consolidated entity has
the equity instruments at the date at which they are granted. The fair value is determined by using either the Binomial
at this time performed an assessment of the performance obligations within current contracts and has assessed that there
or Black-Scholes model taking into account the terms and conditions upon which the instruments were granted. The
will be no material impacts on the way revenue is currently recognised.
accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the
carrying amounts of assets and liabilities within the next annual reporting period but may impact profit or loss and equity.
AASB 9 Financial Instruments
This standard is applicable to annual reporting periods beginning on or after 1 January 2018. The standard replaces
Impairment
all previous versions of AASB 9 and completes the project to replace IAS 39 ‘Financial Instruments: Recognition and
An impairment loss is recognised for the amount by which the asset’s or cash-generating unit’s carrying amount exceeds
Measurement’. AASB 9 introduces new classification and measurement models for financial assets. For financial liabilities,
its recoverable amount. To determine the recoverable amount, management estimates expected future cash flows from
the standard requires the portion of the change in fair value that relates to the entity’s own credit risk to be presented
each cash-generating unit and determines a suitable interest rate in order to calculate the present value of those cash
in OCI (unless it would create an accounting mismatch). New simpler hedge accounting requirements are intended to
flows. In the process of measuring expected future cash flows management makes assumptions about future operating
more closely align the accounting treatment with the risk management activities of the entity. The consolidated entity has
results.
considered its financial assets and liabilities and does not believe that there will be any material impacts on the financial
statements.
AASB 16 Leases
This standard is applicable to annual reporting periods beginning on or after 1 January 2019. The standard replaces
AASB 117 ‘Leases’ and for lessees will eliminate the classifications of operating leases and finance leases. Subject to
exceptions, a ‘right-of-use’ asset will be capitalised in the statement of financial position, measured at the present value
of the unavoidable future lease payments to be made over the lease term. The exceptions relate to short-term leases of 12
months or less and leases of low-value assets (such as personal computers and small office furniture) where an accounting
policy choice exists whereby either a ‘right-of-use’ asset is recognised or lease payments are expensed to profit or loss
as incurred. A liability corresponding to the capitalised lease will also be recognised, adjusted for lease prepayments,
These assumptions relate to future events and circumstances
Provision for impairment of receivables
The provision for impairment of receivables assessment requires a degree of estimation and judgement. The level of
provision is assessed by taking into account the recent sales experience, the ageing of receivables, historical collection
rates and specific knowledge of the individual debtor’s financial position.
Internally generated software and research costs
Management monitors progress of internal research and development projects by using a project management system.
Significant judgement is required in distinguishing research from the development phase.
lease incentives received, initial direct costs incurred and an estimate of any future restoration, removal or dismantling
To distinguish any research-type project phase from the development phase, it is the Group’s accounting policy to
costs. Straight-line operating lease expense recognition will be replaced with a depreciation charge for the leased asset
require a detailed forecast of sales or cost savings expected to be generated by the intangible asset. The forecast is
(included in operating costs) and an interest expense on the recognised lease liability (included in finance costs). In the
incorporated into the Group’s overall budget forecast as the capitalisation of development costs commences. This ensures
earlier periods of the lease, the expenses associated with the lease under AASB 16 will be higher when compared to lease
that managerial accounting, impairment testing procedures and accounting for internally-generated intangible assets are
expenses under AASB 117. However EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) results will
based on the same data.
be improved as the operating expense is replaced by interest expense and depreciation in profit or loss under AASB 16.
For classification within the statement of cash flows, the lease payments will be separated into both a principal (financing
activities) and interest (either operating or financing activities) component. The standard will impact the Group as it holds
various leases for premises and assets. The full calculations of the impact have not yet been assessed as the nature of
these contracts is subject to change. As the Group gets closer to the date of implementation, the Group will substantiate
the effects to the financial statements.
Management has determined that for the 2018 financial year that no expenditure be capitalised as an asset. The basis
for this decision is that over the past 5 years there has been significant development of the platform and that the current
platform is completely different to that which previously existed. The system that currently exists is not a standalone asset
and is constantly evolving. Additionally, the codebase and infrastructure regularly changes to keep up with technological
advances.
44 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 45
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
Deferred tax assets
7. Operating segments
The assessment of the probability of future taxable income in which deferred tax assets can be utilised is based on the
Group’s latest approved budget forecast, which is adjusted for significant non-taxable income and expenses and specific
limits to the use of any unused tax losses or credits. If a positive forecast of taxable income indicates the probable use of
a deferred tax asset, especially when it can be utilised without a time limit, that deferred tax asset is usually recognised in
There is only one operating segment (candidate referencing) for the year ended 30 June 2018. The disclosures on the face
of the statement of comprehensive income to operating loss and the statement of financial position (excluding the items
designated for sale) represent the Group’s one business segment.
full.
Geographical information
Research and Development Refundable Tax Offset
The Group has identified costs including hosting fees, market research, external contractors, system testing and
remuneration which it has identified as research and development costs. The Research and Development tax refund is
calculated as 43.5% of the total figure.
6. Group information
The preliminary consolidated financial statements of the Group include
Principal activities
Principal place of
business / Country
of incorporation
Ownership
interest
Name
2018
%
2017
%
Xref Limited
Candidate Referencing
Australia
100.00%
100.00%
Xref (AU) Pty Limited
Candidate Referencing
Australia
100.00%
100.00%
Xref (UK) Limited
Candidate Referencing
United Kingdom
100.00%
100.00%
Xref Referencing (CA) Limited
Candidate Referencing
Xref AS
Candidate Referencing
Canada
Norway
100.00%
100.00%
100.00%
-
a. Investments in subsidiaries
All investments in subsidiaries are carried at cost and eliminated through consolidation in the Group.
Credit sales to external customers
Australia
Canada
United Kingdom
Norway
Revenue from external customers
Australia
Canada
United Kingdom
Norway
Non-current operating assets
Australia
Canada
United Kingdom
Norway
2018
$
2017
$
6,150,386
3,844,059
455,107
354,664
111,566
120,864
142,595
-
7,071,723
4,107,518
2018
$
2017
$
4,316,355
2,889,087
222,011
241,223
66,411
23,124
68,238
-
4,846,000
2,980,449
Consolidated
2018
$
2017
$
390,283
104,842
58,113
7,016
207,128
22,125
58,102
-
46 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 47
Total Non-current operating assets
560,254
287,355
The information above is based on the locations of the customers.
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
8. Discontinued operations
Description
The assets and liabilities related to Inner Mongolia Plate Mining Co Limited have been presented as held for sale following
10. Overheads and administrative expenses
the acquisition by Xref Pty Limited.
Financial performance information
Audit fees
Accounting
Directors fees
Legal fees
Marketing fees
Other Consultants
Share Option Expense
Administration expense
Foreign exchange loss
Operating lease payments
Expenses
Loss before income tax expense
Income tax expense
Loss after income tax expense from discontinued operations
Cash flow information
Net cash used in operating activities
9. Revenue
Revenue
Consolidated
2018
$
-
-
-
-
2017
$
(967)
(967)
-
(967)
Consolidated
2018
$
-
2017
$
(967)
Consolidated
2018
$
2017
$
Auditors remuneration
Fees charged by Audit Firm:
Financial statement audit and review
90,678
111,352
11. Depreciation, amortisation and impairment expenses
Consolidated
2018
$
2017
$
Consolidated
2018
$
90,678
250,709
263,157
178,566
2017
$
111,352
314,279
232,353
187,628
1,559,137
1,486,865
900,470
761,867
830,788
363,454
1,742,124
1,301,920
(76,477)
688,867
25,522
554,915
6,359,098
5,409,076
Consolidated
2018
$
2017
$
Rendering of services
4,846,000
2,980,449
Depreciation of property, plant and equipment
78,927
46,181
48 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 49
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
12. Research and development costs
14. Income tax expense
Consolidated
2018
$
2017
$
Research and development costs expensed
3,931,717
3,183,062
The Parent and Group research and development projects have focused on cloud-based solutions for candidate recruitment.
Note 5 reflects the Groups policy on the expensing/ capitalisation of development costs.
Research and development costs expenses amount to $3,931,717 (2017: $3,183,063) of which $3,145,694 (2017: $2,420,768)
are recognised in employee expenses.
13. Other income
Other Income
Profit on Sale
Research & Development - Refundable Tax Offset
Interest Received
Other Income
Other income
Consolidated
2018
2017
$
-
$
2
1,710,297
1,384,632
117,452
21,391
53,031
-
The Company has moved domicile from New Zealand to Australia, and so the company does not recognise a potential
tax loss in New Zealand. However, Xref Limited has operating subsidiaries in Australia, the UK, Norway and Canada which
are expected to accumulate tax losses prior to returning a profit.
Consolidated
2018
$
2017
$
Numerical reconciliation of income tax expense and tax at the statutory rate
a. Reconciliation of effective tax rate
Loss before income tax expense from continuing operations
(8,912,898)
(6,456,038)
Loss before income tax expense from discontinued operations
-
(967)
(8,912,898)
(6,457,005)
Tax at the statutory tax rate of 27.5% (2017: 30%)
(2,451,045)
(1,937,102)
Deferred tax asset not recognised
Permanent differences
Adjustment for foreign tax rates
1,401,250
1,772,574
505,956
(441,019)
543,839
605,547
Income tax expense
-
-
1,849,140
1,437,665
b. Deferred tax assets and liabilities
The assessment of the probability of future taxable income in which deferred tax assets can be utilised is based on the
Group’s latest approved budget forecast, which is adjusted for significant non-taxable income and expenses and specific
limits to the use of any unused tax losses or credits. If a positive forecast of taxable income indicates the probable use of
a deferred tax asset, especially when it can be utilised without a time limit, that deferred tax asset is usually recognised in
full.
The company has not yet raised a deferred tax entry as the company is not certain whether the tax losses carried
forward can be utilised in the foreseeable future. The deferred tax asset position of the Group, which has not been
brought to account is $3,173,824 (2017: $1,772,574).
50 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 51
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
15. Current assets - cash and cash equivalents
Cash at bank
Rental bonds
The carrying amount of cash and cash equivalents approximates their fair value.
Consolidated
2018
$
2017
$
4,381,389
3,999,066
70,507
70,507
4,451,896
4,069,573
Trade debtors and other receivables are non-interest bearing and receipt is normally on 30 days terms. Therefore, the
carrying value of trade debtors and other receivables approximates its fair value.
All receivables are subject to credit risk exposure.
The maximum exposure to credit risk at the reporting date is the carrying amount of trade debtors and other receivables
as disclosed above. The Group does not hold any collateral as security
The Group’s management considers that all financial assets that are not impaired or past due for each of the reporting
dates under review are of good credit quality. None of the Group’s financial assets are secured by collateral or other credit
enhancements.
The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade
and other receivables. The main components of this allowance are a specific loss component that relates to individually
significant exposures, and a collective loss component established for groups of similar assets in respect of losses that
have been incurred but not yet identified. The collective loss allowance is determined based on historical data of payment
The Parent has arranged a legal right of set off between its bank trading account, call deposit accounts, and its bank
statistics for similar financial assets.
overdraft. Cash at bank earns interest at floating rates on daily deposit balances.
Rental bonds are for a period of 3 years and serve as security for leased premises maturing at renewal dates. Interest is
paid annually.
16. Current assets - trade and other receivables
The impairment to receivables as at 30 June 2018 is $165,000 (2017: No impairment recognised).
As at 30 June 2018, the ageing analysis of trade receivables post due but not impaired is detailed as follows:
Trade debtors
Less: Provision for impairment of receivables
Related party receivables
Other receivables
Research and development incentive grant
0 - 30 days overdue
30 - 90 days overdue
90 days overdue
Consolidated
2018
$
2017
$
1,599,430
1,199,661
(165,000)
-
1,434,430
1,199,661
-
-
1,499
30,292
1,710,297
1,384,632
1,710,297
1,416,423
3,144,727
2,616,084
Consolidated
2018
$
2017
$
1,129,135
292,920
12,375
793,537
348,375
57,749
1,434,430
1,199,661
52 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 53
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
17. Non-current assets - property, plant and equipment
Reconciliations
Office Fitout
Less: Accumulated depreciation
Computer equipment - at cost
Less: Accumulated depreciation
Office equipment - at cost
Less: Accumulated depreciation
Office furniture - at cost
Less: Accumulated depreciation
Consolidated
2018
$
2017
$
96,784
(10,058)
12,284
(1,359)
86,726
10,925
183,028
123,599
(76,275)
(29,188)
106,753
94,411
116,087
103,271
(50,815)
(33,489)
65,272
69,782
72,915
(9,561)
39,973
(2,734)
63,354
37,239
322,105
212,357
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Consolidated
$
$
$
$
Computer
Equipment
Office
Equipment
Office
Furniture Office Fitout
Balance at 1 July 2016
Additions
Disposals
26,176
93,485
-
80,590
7,982
(1,210)
22,493
16,994
-
10,685
1,343
-
Total
$
139,944
119,804
(1,210)
Depreciation expense
(25,250)
(17,580)
(2,248)
(1,103)
(46,181)
Balance at 30 June 2017
Additions
Prior year adjustment
94,411
59,092
-
69,782
7,986
4,269
37,239
32,888
-
10,925
84,440
-
212,357
184,406
4,269
Depreciation expense
(46,750)
(16,765)
(6,773)
(8,639)
(78,927)
Balance at 30 June 2018
106,753
65,272
63,354
86,726
322,105
18. Non-current assets - intangibles
Patents and trademarks - at cost
Domain: Xref.com & XF1.com
Consolidated
2018
$
10,963
2017
$
-
106,990
101,681
117,953
101,681
54 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 55
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
19. Current liabilities - trade and other payables
21. Current liabilities - Unearned Revenue
Trade payables
Non trade payables and accrued expenses
Related party payables
Accrued salaries, wages and related costs
GST Payable
Consolidated
2018
$
2017
$
162,894
525,139
-
853,126
104,865
571,166
552,807
4,097
481,441
31,991
1,646,024
1,641,502
Unearned Revenue
Balance Brought Forward
Unearned Revenue Movement
Credits Sold
Add Opening Conditional Credits
Less: Credit Used (Cash Basis*)
Less: Closing Conditional Credits
2018
$
2017
$
2,030,253
903,566
7,071,723
1,085,263
4,107,518
205,132
(4,485,468)
(2,100,318)
(1,445,795)
(1,085,263)
Refer to note 27 for further information on financial instruments.
Trade creditors and other payables are non-interest bearing and normally settled on 30 day terms; therefore, their carrying
amount approximates their fair value.
20. Current liabilities - Employee Entitlements
Consolidated
2018
$
2017
$
Net Unearned Revenue Movement
2,225,723
1,127,069
Opening Balance Revaluation due to
Forex
12,895
(382)
Balance Carried Forward
4,268,871
2,030,253
*This is the value of the credits that have been used in the period
Annual leave
277,529
162,725
sold are added to unearned revenue when the client has paid. The credits are consumed when reference checks are
ordered, and credit usage becomes recognised revenue. At balance date some clients will have purchased credits and have
Short–term employee entitlements represent the Group’s obligation to its current and former employees that are expected
been issued an invoice but will not have paid. The value of these unpaid credit sale invoices are the ‘conditional credits’
to be settled within 12 months of balance date. These consist of accrued holiday entitlements at the reporting date.
above and represents trade debtors (less goods & services tax).
Under Xref’s business model, clients purchase Xref credits to use our candidate referencing platform. The value of credits
56 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 57
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
22. Non-current liabilities - Employee entitlements
The Class A Conversion Event for performance rights was achieved and the Class A shares were issued 4 December 2017.
Non-Current
All issued shares are fully paid and do not have a par value. The holders of ordinary shares have equal voting rights and
share equally in any dividend distribution and any surplus on winding up of the Parent.
Consolidated
Capital risk management
2018
$
2017
$
The consolidated entity’s objectives when managing capital is to safeguard its ability to continue as a going concern,
so that it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital
structure to reduce the cost of capital.
Long service leave
52,622
22,436
23. Equity - issued capital
Consolidated
2018
2017
Shares
Shares
2018
$
2017
$
Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated
as total borrowings less cash and cash equivalents.
In order to maintain or adjust the capital structure, the consolidated entity may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
The consolidated entity would look to raise capital when an opportunity to invest in a business or company was seen as
value adding relative to the current company’s share price at the time of the investment. The consolidated entity is not
actively pursuing additional investments in the short term as it continues to integrate and grow its existing businesses in
order to maximise synergies.
Ordinary shares - fully paid
147,736,127
118,569,460
40,087,991
40,087,991
The consolidated entity is not subject to certain financing arrangements covenants during the financial year ended 30 June
Movements in ordinary share capital
Details
Balance
Shares Issued for Cash
Performance rights Conversion
Capital Raising Costs
Issued for acquisition of domain name
Date
Shares
Issue price
$
1 July 2016
90,273,668
25,042,977
11,428,571
$0.70
8,000,000
16,666,667
-
200,554
$0.00
$0.00
$0.50
83,333
(540,000)
101,681
Balance
Issued for cash
Capital raising costs
Performance rights conversion
30 June 2017
118,569,460
32,687,991
12,500,000
$0.60
7,500,000
-
16,666,667
$0.00
$0.02
(450,000)
350,000
Balance
30 June 2018
147,736,127
40,087,991
Xref issued 12,500,000 shares at $0.60 (a 10.2% discount to the 5-day volume weighted average price) to Australian
institutions and sophisticated investors on 7 August 2017 with the aim of accelerating global sales growth, facilitating
product integrations, driving software development and providing further working capital for the Group’s operations.
2018. The capital risk management policy remains unchanged from the 30 June 2017 Annual Report.
24. Equity - Other equity reserves
Foreign currency reserve
Options reserve
Performance right reserve
Consolidation reserve
Foreign currency reserve
Consolidated
2018
$
2017
$
(240,062)
(34,915)
1,330,963
-
569,096
350,000
(22,845,821)
(22,845,821)
(21,754,920)
(21,961,640)
The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial
statements of foreign subsidiaries for consolidation purposes. It is also used to record gains and losses on hedges of the
net investments in foreign operations.
Performance right reserve
The performance right reserve is used to record unutilised performance rights issued on 18 January 2016 as part of the
consideration for Xref Pty Ltd. Performance Rights operate as an equity-settled, share based compensation plan. When
rights are realised, the balance less any attributable transaction costs will be transferred to issued capital. If rights are not
used, they would be offset against the consolidation reserve.
58 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 59
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
The 50,000,000 performance rights are split into 3 Classes as shown below:
Class
Class A
Class B
Class C
Less Conversion Event
Performance right reserve balance
Class A Conversion Event
Number Granted
Performance Right
Reserve
Weighted Average Fair
Value
$A
$/Right
16,666,667
16,666,667
16,666,666
50,000,000
(33,333,334)
16,666,666
350,000
83,333
-
433,333
(433,333)
-
0.021
0.005
0.00
0.009
0.00
Upon the Group, during any six month reporting period of the company that ends on or prior to 30 months after the date
of issue of the rights, achieving Credit Sales of $A2,500,000 or more.
The Class A Conversion Event was achieved and the Class A shares were issued 4 December 2017.
Class B Conversion Event
Upon the Company achieving a 20 day Volume Weighted Average Market Price of the shares equal to or greater than
$0.50 within two years after the date of issue of the rights and a minimum sale in the UK of either 1000 credits or £25,000
(whichever comes first).
Class C Conversion Event
Upon the Group, during any six month reporting period of the Company that ends on or prior to five years after the date
of issue of the rights, achieving EBITDA of $A2,500,000 or more.
The conversion ratio of the Performance Rights into ordinary shares upon achievement of a relevant Performance
Milestone is one ordinary share for each Performance Right. They are in escrow until 8 February 2018.
The key inputs used in the binomial valuation of the Xref PR’s are summarised in the table below.
Grant date
Expiry date - Class A
Expiry date - Class B
Expiry date - Class C
Xref share value at issue
Share price hurdle (150% above the issue price)
Period over which the VWAP must exceed the share price hurdle
Expected volatility
Risk free rate
Dividend yield
20/01/2016
20/07/2018
20/01/2018
20/01/2021
$0.03
$0.50
20 days
60% to 70%
2.09%
0.00%
Class C options were considered based on likelihood of reaching the target EBITDA and a Nil valuation adopted. All rights
may be converted immediately in the event of a change of control event.
The weighted average contractual life of the outstanding performance rights is 2.55 years.
a. Share option reserve
Issued option and movements of options are shown below:
Issue Date
Expiry date
Average
exercise price
per share
Options Option Reserve
29 July 2016
6.000
32,000
92,160
Consolidation
(1 for 50)
Granted
1 February 2016
1 February 2019
Granted - Class A
1 February 2016
1 February 2019
Granted - Class B
1 February 2016
1 February 2019
Closing Balance
30 June 2016
At 1 July 2016
At 1 July 2016
Expired
Granted (b)
Granted (a)
29 July 2016
1 February 2019
29 July 2016
7 December 2016
25 November 2022
7 December 2016
25 November 2021
3,908,909
199,354
300,000
300,000
3,144
3,144
4,540,909
297,802
0.230
0.230
0.230
0.271
0.120
0.230
0.120
0.700
0.700
0.529
0.230
0.700
0.700
0.585
32,000
4,508,909
(32,000)
2,500,000
5,400,000
12,408,909
4,508,909
2,500,000
5,400,000
960,109
92,160
220,942
(92,160)
67,576
280,578
569,096
229,954
187,895
568,862
211,748
21,217
8,180
69,670
21,295
12,142
At 1 July 2016
1 February 2019
At 30 June 2017
7 December 2016
25 November 2022
At 30 June 2017
7 December 2016
25 November 2021
Granted (c)
22 September 2017
Granted (d)
22 September 2017
3 July 2021
3 July 2021
Granted (e)
Granted (f)
Granted (g)
Granted (h)
22 March 2018
5 February 2022
0.660
249,782
22 March 2018
12 February 2021
0.700
1,000,000
22 March 2018
12 February 2022
0.700
750,000
22 March 2018
12 February 2023
0.700
750,000
0.580
95,390
Closing Balance
30 June 2018
16,241,190
1,330,963
The Class B Conversion Event was achieved and the Class B shares were issued 10 March 2017.
Closing Balance
30 June 2017
60 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 61
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
The options have been valued using a binomial options method, using the following assumptions:
(a)
Listing date (re-listing as Xref Limited)
Price history for volatility determination
Grant date
Measurement date
Exercise price
Expiry date
Life of option
Price of underlying shares at measurement date
Risk free rate = 5 year Government Bond (26/11/2016)
Expected volatility
Dividends expected on the shares
(b)
Listing date (re-listing as Xref Limited)
Price history for volatility determination
Grant date
Measurement date
Exercise price
Expiry date
Life of option
Price of underlying shares at measurement date
Risk free rate = 5 year Government Bond (26/11/2016)
Expected volatility
Dividends expected on the shares
(c)
Listing date (re-listing as Xref Limited)
Price history for volatility determination
Grant date
Measurement date
Exercise price
Expiry date
Life of option
Price of underlying shares at measurement date
Risk free rate = 5 year Government Bond (26/11/2016)
Expected volatility
Dividends expected on the shares
9/02/2016
2.47yr
26/11/2016
26/11/2016
$0.70
25/11/2021
5.00 yr
$0.47
2.19%
40%
Nil
09/02/2016
5.00yr
25/11/2016
25/11/2016
$0.70
25/11/2022
6.00 yr
$0.47
2.7%
40%
Nil
9/02/2016
1.63 yr
22/09/2017
22/09/2017
$0.585
03/07/2021
3.77 yr
$0.745
2.295%
40%
Nil
(d)
Listing date (re-listing as Xref Limited)
Price history for volatility determination
Grant date
Measurement date
Exercise price
Expiry date
Life of option
Price of underlying shares at measurement date
Risk free rate = 5 year Government Bond (26/11/2016)
Expected volatility
Dividends expected on the shares
(e)
Listing date (re-listing as Xref Limited)
Price history for volatility determination
Grant date
Measurement date
Exercise price
Expiry date
Life of option
Price of underlying shares at measurement date
Risk free rate = 5 year Government Bond (26/11/2016)
Expected volatility
Dividends expected on the shares
(f)
Listing date (re-listing as Xref Limited)
Price history for volatility determination
Grant date
Measurement date
Exercise price
Expiry date
Life of option
Price of underlying shares at measurement date
Risk free rate = 5 year Government Bond (26/11/2016)
Expected volatility
Dividends expected on the shares
9/02/2016
1.63 yr
22/09/2017
22/09/2017
$0.58
03/07/2021
3.77 yr
$0.745
2.295%
40%
Nil
9/02/2016
2.11 yr
22/03/2018
22/03/2018
$0.66
05/02/2022
3.88 yr
$0.57
2.395%
26.37%
Nil
9/02/2016
2.11 yr
22/03/2018
22/03/2018
$0.70
01/02/2021
2.87 yr
$0.57
2.160%
26.3%
Nil
62 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 63
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
(g)
Listing date (re-listing as Xref Limited)
Price history for volatility determination
Grant date
Measurement date
Exercise price
Expiry date
Life of option
Price of underlying shares at measurement date
Risk free rate = 5 year Government Bond (26/11/2016)
Expected volatility
Dividends expected on the shares
(h)
Listing date (re-listing as Xref Limited)
Price history for volatility determination
Grant date
Measurement date
Exercise price
Expiry date
Life of option
Price of underlying shares at measurement date
Risk free rate = 5 year Government Bond (26/11/2016)
Expected volatility
Dividends expected on the shares
9/02/2016
2.11 yr
22/03/2018
22/03/2018
$0.70
12/02/2022
2.87 yr
$0.57
2.395%
26.340%
Nil
9/02/2016
2.11 yr
22/03/2018
22/03/2018
$0.70
12/02/2023
4.90 yr
$0.57
2.395%
26.350%
Nil
Class A Vesting Event is the same as a Performance Right Class A Conversion Event
Upon the Group, during any six month reporting period of the company that ends on or prior to 30 months after the date
of issue of the rights, achieving Credit Sales of $A2,500,000 or more.
Class B Vesting Event is the same as a Performance Right Class B Conversion Event
Class B Vesting Event is the same as a Performance Right Class B Conversion Event Upon the Company achieving a 20
day Volume Weighted Average Market Price of the shares equal to or greater than $0.50 within two years after the date
of issue of the rights and a minimum sale in the UK of either 1000 credits or £25,000 (whichever comes first). The Class B
Conversion Event was achieved and the Class B shares were issued 10 March 2017.
Class A and B option expense is being recognised over the two years during which the options may be exercised. If the
options were to be exercised, the full remaining option expense if any would be immediately recognised and the Option
Reserve figure transferred to Issued Capital.
The weighted average contractual life of the performance rights for the 2018 year was 2.55 years (2017: 1.59 years).
Option movements during the year
At 26 September 2017, 1,055,499 options were issued under the terms of the Employee Option Plan to 52 of its employees
and 5 of its contractors.
At 22 March 2018, 2,749,782 options were issued under the terms of the Employee Option Plan to 25 of its employees and
to the Company’s Chief Financial Officer (CFO).
Option movements during the previous year
On the 29th July 2016, 92,160 options expired.
As approved at the 25th November 2016 AGM, 7,900,000 options were issued to 2 directors of the company as a key
component of their remuneration by the company. Chairman Brad Rosser was issued with 7,000,000 with 4,500,000 expiring
on the 25th November 2021 and 2,500,000 expiring on the 25th November 2022. Nigel Heap was issued 900,000 options,
all expiring on the 25th November 2021. 300,000 of the options issued to Nigel Heap vested on the 25th November 2016.
Options vested and therefore exercisable
Source
Expiry Date
2018
2017
Acquisition of Xref Pty Ltd
Options Vested – Tim Mahony
Options Vested – Nigel Heap
Options Vested - Brad Rosser
Options Vested – James Solomons
1 February 2019
3,908,809
3,908,809
1 February 2019
25 November 2021
25 November 2021
12 February 2021
900,000
300,000
2,000,000
1,000,000
600,000
300,000
-
-
8,108,809
4,808,909
The weighted average share price for the 2018 financial year was $0.624 (2017: $0.548)
b. Consolidation Reserve
The reserve was formed on the reverse acquisition of assets and liabilities of King Solomon Mines Limited by Xref Pty
Limited which brought the share capital of Xref Pty Limited to the share capital of King Solomon Mines Limited immediately
after the reverse acquisition.
25. Equity - dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
26. Earnings per share
Basic EPS amounts are calculated by dividing the profit for the year attributable to ordinary equity holders of the parent
by the weighted average number of ordinary shares outstanding during the year.
Diluted EPS amounts are calculated by dividing the profit attributable to ordinary equity holders of the Parent by the
weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary
shares that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares.
The Group recorded losses for the years ended 30 June 2017 and 30 June 2018. Diluted earnings per share has not been
calculated because the effect of including the share options in the calculation would be anti-dilutive. Hence the diluted
earnings per share is the same as the basic earnings per share.
64 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 65
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
The following reflects the income and share data used in the basic and diluted EPS computations
Consolidated
2018
$
2017
$
Group 2018
Financial assets
Loans and
receivables
Available-for-
sale financial
assets
Financial
liabilities at fair
value through
profit and loss
Earnings per share for loss from continuing operations
Loss after income tax attributable to the owners of Xref Limited
(8,912,898)
(6,456,038)
Cash and cash equivalents
Trade debtors and other receivables
Total
4,451,896
3,144,727
7,596,623
Weighted average number of ordinary shares used in calculating basic earnings
per share
Number
Number
139,516,949
105,341,482
Financial liabilities
Trade creditors and other payables
Weighted average number of ordinary shares used in calculating diluted earnings
per share
139,516,949
105,341,482
Total
-
-
-
-
-
-
-
Basic earnings per share
Diluted earnings per share
Cents
(6.39)
(6.39)
Cents
(6.13)
(6.13)
Consolidated
2018
$
2017
$
Group 2017
Financial assets
Loans and
receivables
Available-for-
sale financial
assets
Financial
liabilities at fair
value through
profit and loss
Cash and cash equivalents
Trade debtors and other receivables
Total
4,069,573
2,616,084
6,685,657
2,107,821
2,107,821
2,107,821
2,107,821
Total
4,451,896
3,144,727
7,596,623
Total
4,069,573
2,616,084
6,685,657
-
-
-
-
-
-
1,919,485
1,919,485
1,919,485
1,919,485
-
-
-
-
-
Earnings per share for loss from discontinued operations
Loss after income tax attributable to the owners of Xref Limited
N/A
(967)
Financial liabilities
Trade creditors and other payables
Consolidated
Total
2018
$
2017
$
b. Financial instrument risk management
-
-
Earnings per share for loss
Loss after income tax attributable to the owners of Xref Limited
(8,912,898)
(6,457,005)
The Group has exposure to the following risks from its use of financial instruments:
27. Financial instruments
a. Classification of financial instruments
The carrying amounts presented in the statement of financial position relate to the following categories of financial assets
and liabilities.
> Credit risk
>
Liquidity Risk
> Market Risk
The Group is exposed to market risk through their use of financial instruments and specifically to currency risk, interest
rate risk and certain other price risks, which result from both its operating and investing activities.
The Group has a series of policies to manage the risk associated with financial instruments. Policies have been estab-
lished which do not allow transactions that are speculative in nature to be entered into and the Group is not actively en-
gaged in the trading of financial instruments. As part of this policy, limits of exposure have been set and are monitored
on a regular basis.
66 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 67
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
i. Credit risk
iii. Market risk
Credit risk is the risk that a third party will default on its obligation to the Group, causing the Group to incur a loss.
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will
The Group has no significant concentration of risk in relation to cash and cash equivalents, trade debtors and other
financial assets.
The Group continuously monitors defaults of customers and other counterparties, identified either individually or by
group, and incorporates this information into its credit risk controls.
Further details in relation to the credit quality of financial assets is provided in Note 16
ii. Liquidity risk
Liquidity risk represents the Group’s ability to meet is contractual obligations as they fall due. The Group manages liquidity
risk by managing cash flows and ensuring that adequate cash is in place to cover any potential short falls.
During the financial year expense growth reduced from 90% in the 2017 year to 44% in 2018, with a growth in revenue of
72%. There is continued growth forecasted and ongoing strong cost control enabling adequate management of liquidate
risk.
All amounts shown as current financial liabilities are expected to be paid on demand and without interest.
The Group’s financial liabilities have contractual maturities (including interest payments where applicable) as summarised
below:
Group 2018
Contractual cash-flow maturities
Carrying
amounts
Total
contractual
cash-flows
0-6
months
6-12
months
1 - 2
years
2-5
years
Later
than 5
years
Non-derivative financial
liabilities
Trade creditors and other
payables
1,646,024
1,646,024
1,646,024
Superannuation payable
184,268
184,268
184,268
Total
1,830,292
1,830,292
1,830,292
-
-
-
-
-
-
-
-
-
-
-
-
affect the Group’s income or the value of its holdings of financial instruments. The objective of market risk management
is to manage and control market risk exposures within acceptable parameters, while optimising the return.
iv. Foreign exchange risk
The Group is exposed to fluctuations in foreign currency exchange rates as a result of maintaining foreign currency
denominated bank accounts and entering into foreign currency transactions. Thus, the Group will incur a foreign exchange
gain or loss each year due to the appreciation and depreciation of the Australian Dollar relative to other currencies
including the Canadian Dollar, the UK Pounds Sterling and the Norwegian Krone.
The exposure to currencies of the Group is as follows:
Canadian Dollars
UK Pound Sterling
Norwegian Krone
New Zealand Dollars
Total
2018
$
176,044
100,975
111,427
-
388,446
2017
$
37,130
56,284
-
1,507
94,921
The potential impact on the bank accounts, net deficits and equity movements in foreign currency exchange rates
(calculated by applying the change in foreign exchange rate to foreign currencies held at balance date) is indicated below:
Potential Foreign Exchange Rate Fluctuation
Impact on valuation of holding in:
Canadian Dollars
UK Pound Sterling
Norwegian Krone
Total impact of potential change in exchange rate
5%
$
8,802
5,049
5,571
19,442
10%
$
17,604
10,098
11,143
38,845
20%
$
35,209
20,195
22,285
77,689
Group 2017
Contractual cash-flow maturities
Foreign exchange risk
Carrying
amounts
Total
contractual
cash-flows
0-6
months
6-12
months
1 - 2
years
2-5
years
Later
than 5
years
Non-derivative financial
liabilities
Trade creditors and other
payables
1,641,502
1,641,502
1,641,502
Superannuation payable
115,258
115,258
115,258
Total
1,756,760
1,756,760
1,756,760
-
-
-
-
-
-
-
-
-
-
-
-
Currency risk is the risk that the fair value of financial instruments will fluctuate due to a change in foreign exchange rates.
Most of the Group transactions are carried out in Australian Dollars (AUD). Exposures to currency exchange rates arise
from the Group’s overseas sales and purchases, which are primarily denominated in United Kingdom Pounds Sterling
(GBP) , Canadian dollars (CAD) and Norwegian Krone (NOK)
The Group monitors foreign expenditure, seeking favourable terms when it is time to for further funding. By adopting this
passive strategy, it expects its average foreign exchange rates to reflect the average foreign exchange rate for the year.
68 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 69
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
Foreign currency denominated financial assets and liabilities which expose the Group to currency risk are disclosed below.
The amounts shown are those reported to key management translated into AUD at the closing rate:
Short-term exposure
30 June 2018 – Group
AUD
United Kingdom
Canada
Financial Assets
Financial Liabilities
7,083,425
1,842,269
153,396
211,955
62,332
75,948
Norway
147,847
127,272
Net statements of financial
position exposure
5,241,156
91,064
136,007
20,575
Group
5% (2017: 5%) increase in AUD against
foreign currencies
5% (2017: 5%) decrease in AUD against
foreign currencies
2018
2017
Profit for the
year
Equity
Profit for the
year
Equity
(9,038,288)
1,707,900
(6,540,069)
3,143,168
(8,850,009)
2,158,275
(6,416,487)
3,347,656
Exposures to foreign exchange rates vary during the year depending on the volume of overseas transactions. Nonetheless,
the analysis above is considered to be representative of the Group’s exposure to currency risk.
Long-term exposure
Interest rate risk
United Kingdom
Canada
Norway
Interest rate risk is the risk that cash flows from a financial instrument will fluctuate because of changes in market interest
30 June 2018 – Group
Financial Assets
Financial Liabilities
Net statements of financial
position exposure
AUD
50,948
-
50,948
51,411
17,836
-
-
51,411
17,836
-
-
-
Short-term exposure
30 June 2017 – Group
AUD
United Kingdom
Canada
Norway
Financial Assets
Financial Liabilities
Net statements of financial
position exposure
6,385,797
1,636,040
4,749,757
112,949
111,913
95,076
25,644
17,873
86,269
-
-
-
Long-term exposure
30 June 2017 – Group
Financial Assets
Financial Liabilities
Net statements of financial
position exposure
AUD
74,998
-
74,998
United Kingdom
Canada
Norway
-
-
-
-
-
-
-
-
-
Foreign exchange risk
Sensitivity analysis
The following analysis illustrates the sensitivity of profit and equity in regard to the Group’s financial assets and financial
liabilities carried in foreign currencies. It assumes a +/- 5% change in exchange rates for the year ended at 30 June 2018
(2017: 5%).
The percentage movement has been determined based on the average exchange rate market volatility for the AUD in the
previous 12 months.
rates.
Revenue of the Group is exposed to interest rate risk on interest bearing financial assets only as it has immaterial bank
overdraft balances. The Group is also exposed to interest rate risk on interest bearing financial assets. The Group’s
investment in bonds all pay fixed interest rates and the interest risk exposure on money market funds is considered
immaterial.
28. Reconciliation of loss after income tax to net cash used in operating activities
Consolidated
2018
$
2017
$
Loss after income tax expense for the year
(8,912,898)
(6,457,005)
Adjustments for:
Depreciation, amortisation and impairment
Option expense
Foreign exchange
Unearned revenue
Change in operating assets and liabilities:
Increase in trade and other receivables
Increase in prepayments
Decrease in other financial assets
Increase/(decrease) in trade and other payables
Increase in employee benefits
Increase in other financial liabilities
78,927
46,181
761,867
363,454
(205,147)
(56,853)
2,225,723
1,127,069
(528,643)
(1,572,023)
(37,266)
(140,488)
(45,198)
(26,531)
253
1,001,202
144,990
122,239
50,393
21,470
Net cash used in operating activities
(6,466,999)
(5,571,285)
70 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 71
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
29. Contingent assets
The Group has no contingent assets at 30 June 2018 (2017: $Nil).
30. Contingent liabilities
The Group has no contingent liabilities at 30 June 2018 (2017: $Nil).
31. Related party transactions
Related party transactions arise when an entity or person(s) has the ability to significantly influence the financial and
operating policies of the Group.
The Group has a related party relationship with its Shareholders, Directors and other key management personnel.
Unless otherwise stated transactions with related parties in the years reported have been on an arms-length basis, none
of the transactions included special terms, conditions or guarantees.
The following transactions were carried out with related parties
a. Purchase of services
Key management personnel
Other related parties
Consolidated
2018
$
2017
$
218,886
165,560
-
19,396
218,886
184,956
c. Other related party balances
Loans to directors for the year ended 30 June 2018 amounted to $0 (2017: $1,499).
d. Key management 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 benefit
Post employment benefits
Share-based payments
32. Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
Consolidated
2018
$
2017
$
1,206,795
1,145,551
71,250
62,593
524,380
363,453
1,802,425
1,571,597
Parent
2018
$
2017
$
(761,781)
(489,902)
(761,781)
(489,902)
b. Year end receivable/ (payable) with related parties
The following balances are outstanding at the reporting date in relation to transactions with related parties:
Loss after income tax
Total comprehensive income
Receivable from related parties:
Directors
Payable to related parties:
Other related party
Consolidated
2018
$
-
-
2017
$
1,499
4,097
72 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 73
NOTES TO THE FINANCIAL STATEMENTS / continued
NOTES TO THE FINANCIAL STATEMENTS / continued
Statement of financial position
33. Commitments
Operating leases are held for premises used for office space. Lease commitments net of incentive payments are:
Total current assets
Total non-current assets
Total assets
Total current liabilities
Total liabilities
Equity
Issued capital
Reserves
Retained profits
Total equity
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
Parent
2018
$
-
2017
$
1,507
21,705,222
14,849,709
21,705,222
14,851,216
(33,750)
112.655
(33,750)
112,655
40,087,991
33,089,721
1,330,963
569,096
(19,679,982)
(18,920,256)
21,738,972
14,738,561
Non-cancellable operating leases are payable as follows:
Less than one year
Later than one year and not greater than two years
Later than two years and not greater than five years
Consolidated
2018
$
2017
$
507,020
548,036
461,506
257,357
104,480
-
1,516,562
361,837
The Group had no other commitments at 30 June 2018 (2017; $Nil).
34. Events after the reporting period
In August 2018, the Board gave approval to issue further invitations to eligible employees to participate in the Xref
Employee Option plan. Should 100% of the invitations be accepted 1,275,569 new employee share options will be issued.
No other adjusting or significant non-adjusting events have occurred between the reporting date and the date of
There are no guarantees entered into by the parent entity in relation to the debts of its subsidiary Inner Mongolia Plate
authorisation.
Mining Limited or any other Xref subsidiary in 2018 or 2017.
Contingent liabilities
The parent entity had no contingent liabilities in 2018 or 2017.
Capital commitments - Property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment in 2018 or 2017
74 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 75
Independent
Auditor’s Report
Directors’
Report
In the directors’ opinion:
>
>
>
>
the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the
Corporations Regulations 2001 and other mandatory professional reporting requirements;
the attached financial statements and notes comply with International Financial Reporting Standards as issued by
the International Accounting Standards Board as described in note 3 to the financial statements;
the attached financial statements and notes give a true and fair view of the consolidated entity’s financial position
as at 30 June 2018 and of its performance for the financial year ended on that date; and
there are reasonable grounds to believe that the company will be able to pay its debts as and when they become
due and payable.
The directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act 2001.
On behalf of the directors
Lee-Martin Seymour
Brad Rosser
Managing Director
Chairman
29 August 2018
29 August 2018
Sydney
Sydney
76 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 77
INDEPENDENT AUDITOR’S REPORT / continued
INDEPENDENT AUDITOR’S REPORT / continued
78 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 79
INDEPENDENT AUDITOR’S REPORT / continued
INDEPENDENT AUDITOR’S REPORT / continued
80 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 81
Shareholder
Information
SHAREHOLDER INFORMATION / Continued
Information relating to shareholders, as required by ASX Listing Rule 4.10, and not disclosed elsewhere in this Annual
Top 20 Holders of Ordinary Shares as at 23 July 2018
Report, is detailed below.
Substantial Shareholders as at 23 July 2018, as disclosed in substantial holding notices given to the ASX and to the Company:
Rank
Name of Shareholder
Shares % of Shares
Substantial Shareholders
Shareholding
% Shares Issued
Squirrel Holdings Australia Pty Ltd
West Riding Investments Pty Ltd
Industry Super Holdings Pty Ltd
FIL Limited
30,857,613
30,857,612
10,941,897
8,435,033
20.89
20.89
7.41
5.71
Based on the market price at 23 July 2018 there were 125 shareholders with less than a marketable parcel of 1,021 shares
at a share price of $0.49.
Number of Ordinary Shares Held
Number of Holders
Ordinary Shares
% of Total Issue Capital
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Total
123
208
153
257
82
823
53,654
648,180
1,226,735
9,738,711
136,068,847
147,736,127
0.04
0.44
0.83
6.59
92.10
100.000
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Squirrel Holdings Australia Pty Ltd
West Riding Investments Pty Ltd
HSBC Custody Nominees (Australia) Limited
CS Third Nominees Pty Limited
Citicorp Nominees Pty Limited
UBS Nominees Pty Ltd
J P Morgan Nominees Australia Limited
Austral Capital Pty Ltd
30,857,613
30,857,612
26,309,701
6,548,841
4,441,603
4,110,414
3,095,141
3,000,000
Morgan Stanley Australia Securities (Nominee) Pty Limited
2,250,802
Parkstone House Pty Ltd
Yeehah Pty Ltd
CS Fourth Nominees Pty Limited
Mr Tim Mahony + Ms Jacki Pervan
Debuscey Pty Ltd
Schindler Investment Haus Pty Ltd
Brispot Nominees Pty Ltd
Calama Holdings Pty Ltd
National Nominees Limited
First Trustee Company (NZ) Limited
Est Mr John Alan MacBride Price
Total of Top 20 Holdings
Other Holdings
Total Fully Paid Shares Issued
20.89
20.89
17.81
4.43
3.01
2.78
2.10
2.03
1.52
1.30
0.80
0.70
0.68
0.67
0.62
0.62
0.56
0.53
0.51
0.51
1,923,076
1,180,000
1,039,674
1,000,000
996,592
912,500
908,842
831,600
778,409
750,000
750,000
122,542,420
25,193,707
82.95
17.05
147,736,127
100.00
Performance Rights as at 23 July 2018
Name of Performance Holder
Performance Shares the Holder is Entitled to
Squirrel Holdings Australia Pty Ltd
C Class Performance Rights: 8,333,333
West Riding Investments Pty Ltd
C Class Performance Rights: 8,333,333
Total
16,666,666
The conversion ratio of the Performance Rights into ordinary shares upon achievement of a relevant performance
milestone is one ordinary share for each Performance Right.
82 / Xref Limited / Annual Report 2018
Xref Limited / Annual Report 2018 / 83
SHAREHOLDER INFORMATION / continued
Options as at 23 July 2018
Name of Option Holder
Taycol Nominees Pty Ltd
Yoix Pty Ltd
Bear and Unicorn Properties Limited
Jimbzal Pty Ltd
Mr Timothy Lloyd Mahony + Jackie Tadranka Pervan