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Group
Limited
Annual
Report
2021
ZOONO GROUP LIMITED
AND CONTROLLED ENTITIES
ABN 73 006 645 754
ANNUAL REPORT
FOR THE YEAR ENDED
30 JUNE 2021
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Contents
FINANCIAL DATA SUMMARY | 4
OUR TEAM | 6
CEO’S REVIEW | 8
DIRECTORS’ REPORT | 10
CUSTOMER HIGHLIGHT | 15
INFORMATION ON DIRECTORS | 16
REMUNERATION REPORT (AUDITED) | 18
AUDITOR’S INDEPENDENCE DECLARATION | 21
CONSOLIDATED STATEMENT OF PROFIT
AND OTHER COMPREHENSIVE INCOME | 22
CONSOLIDATED STATEMENT OF FINANCIAL POSITION | 23
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | 24
CONSOLIDATED STATEMENT OF CASH FLOWS | 26
NOTES TO THE FINANCIAL STATEMENTS | 27
DIRECTORS’ DECLARATION | 44
AUDITOR’S INDEPENDENT REPORT | 45
ADDITIONAL INFORMATION FOR PUBLICLY LISTED COMPANIES | 50
CORPORATE DIRECTORY | 52
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Financial
Data
Summary
FINANCIAL PERFORMANCE 30 JUNE 2021 NZ$
NET PROFIT
BEFORE TAX
$5,897,953
OPERATING
EXPENSES
$10,570,369
OTHER REVENUE
$366,333
4
COST OF SALES
$11,031,613
TOTAL REVENUE
$27,133,602
FINANCIAL PERFORMANCE 30 JUNE 2020 NZ$
FINANCIAL PERFORMANCE 30 JUNE 2019 NZ$
NET PROFIT
BEFORE TAX
$20,412,049
OPERATING
EXPENSES
$8,092,337
OTHER
REVENUE
$170,778
COST OF SALES
$9,995,761
TOTAL REVENUE
$38,329,369
TOTAL REVENUE
$1,777,156
NET LOSS
BEFORE TAX
$(2,418,984)
COST OF SALES
$960,463
OTHER
REVENUE
$136,142
OPERATING
EXPENSES
$3,371,819
GROSS PROFIT %
74%
59%
46%
TOTAL REVENUE NZ$
2019
2020
2021
GROSS PROFIT NZ$
$28,333,608
$816,693
2019
2020
2020
REVENUE BY QUARTER NZ$
$16,101,989
PROFIT/(LOSS) BEFORE INCOME TAX NZ$
$45,000,000
$40,000,000
$35,000,000
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$0
$38,329,369
$27,133,602
$1,777,156
2019
2020
2021
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$0
-$5,000,000
-$2,418,984
2019
$20,412,049
5
$5,897,953
2020
2021
$20,930,415
$15,683,974
$7,290,819
$7,134,049
$6,083,702
$6,625,032
$356,671
$813,920
$345,901
$901,060
$437,373
$637,211
FY19 FY20 FY21
Q1
FY19 FY20 FY21
Q2
FY19 FY20 FY21
Q3
FY19 FY20 FY21
Q4
80.0%
70.0%
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$0
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
$0
ZOONO GROUP LIMITED ANNUAL REPORT 2021 1
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ZOONO HEAD OFFICE NEW ZEALAND
ZOONO NEW ZEALAND FROM LEFT TO RIGHT: OLIVIA
HYSLOP, LEW MACKINNON, MICHAEL WU, NADENE
ERASMUS, PAUL RAVLICH, CLOIE MINA, SHANNEN
COWMEADOW, DWAYNE DEAN, PIP HOBSON, PAUL
HYSLOP, PAUL MORRISON,
HENRY HYSLOP.
Our
Team
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ZOONO UNITED KINGDOM
UK TEAM FROM LEFT TO RIGHT:
SARAH MOORE, RICHARD BARRETT,
CRAIG DOOTSON, LYNSEY JOHNS,
JAMAL McCLEARY, ASHLEY MALPASS,
OLIVER RINGSBY BURGESS,
JADE PALLETT, MERVYN WATCH,
ELOISE DODMAN
ZOONO UNITED ARAB EMIRATES
DENNIS MONTGOMERY
GARRY WILSON
ZOONO SOUTH AFRICA
ALEXANDER ANDERSON
REGIONAL MANAGER ASEAN
USA TEAM FROM LEFT TO RIGHT:
CHRISTINA SMITH, LLOYD JOHNS,
KIM BENNETT
ZOONO UNITED STATES OF AMERICA
TEAM ZOONO
TEAM ZOONO FROM LEFT TO RIGHT:
PAUL MORRISON, LLOYD JOHNS,
LEW MACKINNON, PAUL HYSLOP,
JAMAL MCCLEARY, PAUL RAVLICH,
MICHAEL WU, DWAYNE DEAN
JAMAL McCLEARY REGIONAL MANAGER UK/EUROPE
PAUL MORRISON REGIONAL MANAGER NZ & AUST
ZOONO NZ STAFF AT PLAY
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SHANNEN COWMEADOW CUSTOMER SERVICES OFFICER
NADENE ERASMUS SOCIAL MEDIA & OPERATIONS SUPERVISOR (NZ)
PIP HOBSON MARKETING MANAGER
HENRY HYSLOP
MICHAEL WOO AND LLOYD JONES
ASEAN AND CHINA MANAGERS
PAUL RAVLICH CHIEF FINANCIAL OFFICER
ROZANNE NIEMAND ASSISTANT ACCOUNTANT
ZOONO GROUP LIMITED ANNUAL REPORT 2021 1
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8
CEO’s
Review
THE 2021 YEAR, PURELY FROM A REVENUE AND PROFIT
PERSPECTIVE, WAS NOT AS GOOD AS 2020. In April 2020, the Company
appeared on an Australian morning TV show, at the onset of COVID, and
received 34,000 orders within the next 24 hours. This avalanche of orders
enabled the Company to achieve record revenues for the month of April;
close to $12m. This was the main difference in the sales revenues across the
two years, and many customers over ordered in 2020.
The Company still delivered revenues of $27m in 2021, and an operating
profit of $6m. Compared to pre-COVID sales, the Company has made
significant progress and is in good shape. Overall, while volume sales and
repeat orders in B2B markets were good, we needed to be more price
competitive, which put downward pressure on margins. However our gross
profit remained at around 60%.
The Company made the decision to more directly control the development of
its business in the second half of FY21 and now has offices and personnel in
the UK, France, USA, China and Dubai, with sales agents in South Africa and
Malaysia. The net result is the Company has fewer distributors, but far more
direct control of its business in the major markets.
This step will enable the Company to deliver its products into markets
without the additional cost layer of a distributor margin and with minimal
risk of ‘price gouging’ by distributors (which was impacting sales in certain
countries). It should also result in lower pricing of the Company’s products in
those markets, but with no negative effect on margins delivering medium to
long term benefits.
In some countries we continue to have and support local distributors and
resellers; mainly countries where legal, cultural and political issues make it
difficult to operate there on a direct basis.
The Company has also started down the path of diversification into several
new industrial areas in 2021. One example is around cardboard packaging
for perishable foods, where extensive testing and trials have shown that
the use of Zoono Z-71 extends the shelf life of perishable food (which is
invaluable where, in particular, that food is exported to foreign markets).
A second example is the joint venture with a UK company that has
developed a proprietary system for converting our liquid products into a
gas which is circulated through buildings via the existing air conditioning
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PAUL HYSLOP
MANAGING DIRECTOR/CEO
infrastructure. The system has multiple benefits, including air and surface quality.
Extensive testing (peer reviewed) has been undertaken to show that the system meets
global standards. The new air conditioning product for air and surface sanitisation
and protection will be known as ‘Zoonex’.
The Company expect the above initiatives to be significant contributors to revenues in
the next 18 months.
As COVID remains at the forefront of much global activity, and effectively launched
Zoono as a global brand, having products that not only inactivate the virus but deliver
long term protection and prevent cross contamination gives the Company a major
point of difference. The Company now has many major brands on board globally with
our technology; companies like Microsoft, Amazon, Bunzl, Atalian Servest, Rentokil
Initial, United Airlines, Qantas, the UK’s NHS and London Underground (currently,
Zoono products are used on all underground trains in the UK and 80% of those above
ground).
The Company is also making progress on several other fronts in the transportation
(including buses, airlines and cruise lines), education and the corporate sectors.
A high proportion of these sales are coming from the northern hemisphere where
more normal business activity is resuming and schools are preparing for a return of
students in September 2021.
In the last 12 months, the Company has also sought to improve shareholder and
market communication. It has developed a monthly newsletter to keep the market
informed of new developments, new customers, test results and staff changes.
We would like to thank all shareholders, staff and stakeholders in our business.
We are working hard to maximise the potential of our products and returns to
shareholders.
PAUL HYSLOP
MANAGING DIRECTOR/CEO
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Directors’
Report
YOUR DIRECTORS PRESENT THEIR REPORT ON ZOONO GROUP LIMITED (‘COMPANY’) AND ITS CONTROLLED
ENTITIES (TOGETHER CALLED THE ‘GROUP’ OR THE ‘CONSOLIDATED ENTITY’) FOR THE FINANCIAL YEAR ENDED 30
JUNE 2021. ALL NUMBERS STATED IN THIS REPORT ARE IN NEW ZEALAND DOLLARS, UNLESS OTHERWISE STATED
OR CONVERTED AT THE EXCHANGE RATES PROVIDED.
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DIRECTORS
The names of directors in office at any
time during or since the end of the year
are:
MR. PAUL HYSLOP
Managing Director
MR. DON CLARKE
Non-Executive Director
MS. ELISSA HANSEN
Non-Executive Director
Directors have been in office for all of the
reporting period and to the date of this
report unless otherwise stated.
COMPANY SECRETARY
Ms. Elissa Hansen
PRINCIPAL ACTIVITIES
The principal activities of the
consolidated entity during the year
were to develop and sell a range of
antimicrobial products in multiple
countries.
OPERATING RESULT
The Group recorded an after-tax profit of
NZ$4,633,236 (2020: NZ$16,659,442) for
the financial year.
REVIEW OF OPERATIONS
While the COVID pandemic continues
around the globe, the Group has made
good progress during the year in its
various markets.
UK & Europe
The current sales momentum continues
in the UK as Zoono works closely with
its major sector partners within facilities
management, transport, agriculture and
healthcare sectors and key customers
including Bunzl, Rentokil Initial, Atalian
Servest, Killis and One Spray.
Zoono now has regulatory approvals
for most EU countries, opening sales
into new channels including healthcare,
childcare, and government. It continues
to gain new customers in Germany,
Scandinavia, Eastern Europe, Spain
and Portugal; a trend that is expected
to continue. The sales pipeline
remains buoyant with a number of new
agreements currently under negotiation.
However, while revenue increased slightly
over the FY20 year, there is no doubt
the Trading Standards investigation,
impacted sales momentum for FY21.
We have issued a formal complaint to
Trading Standards to ensure a resolution
is reached quickly.
Zoono UK has entered into a strategic
partnership with a third party to develop
a unique delivery system for Zoono Z71
Microbe Shield utilizing the existing
air-conditioning infrastructure in large
buildings. The proprietary process
(owned by the third party) converts
Zoono to a gas which is then pumped
throughout a building through the air-
conditioning ducts. As the gasified Zoono
product is heavier than air, it settles on
(and treats) the surface which it contacts.
The delivery system, which is fully
automated, has the added benefit of
treating both the air and surfaces, creates
an efficient and cost-effective solution
for the safeguarding of employees
and customers. The retrofitting of the
necessary equipment in existing buildings
is also a relatively simple process.
Commercial interest in the system has
been received from a large portfolio
owner who owns about 150 buildings.
Estimated volumes for a 5-6 story
building are 300 to 500 litres per building
per month. First orders have been
received.
France
Zoono has commenced selling to
customers in France, with several French
multinational customers now on board.
Customers include:
• Atalian France(a large facility
management company);
• Keolis France (a leader in public
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transport - carrying three billion
passengers a year and operating in 16
countries);
• Cleanysafe (a marketer of new
generation cleaning and/or disinfectant
products that respect the environment);
and
• Major distributors and other cleaning
companies (Toussaint, Lustral, Capem
and Rekeep).
additional testing of Zoono’s Z-71
surface sanitiser during the year for a
new, standalone registration in the US
that would allow Zoono to make 30-day
human COVID claims. Unfortunately,
there have been a number of delays
due to the extraordinary number of
studies being undertaken at laboratories
worldwide as a result of the current
pandemic.
Testing of Zoono products is also
underway with other potential customers
in France, including hospital and hotel
groups, casinos and child nurseries.
Regulatory approvals are also being
sought in Panama and Jamaica and initial
orders have been received from both
Mexico and Barbados.
Russia
In Russia, distribution arrangements with
ECO-SALUS LLC are now in place and
Zoono is approved and registered with
Rospotrebnadzor (the federal service
for surveillance on consumer rights
protection and human wellbeing). Sales
have been particularly strong in the public
sector industries including transport,
where Zoono is now being rolled out to
treat trains.
They have placed an initial order of
NZ$529k for the product launch, and
have placed a further order of NZ$1.4m to
be delivered in the first quarter of FY22.
USA and Americas
The United States Environmental
Protection Agency (EPA) continued
In Canada, Zoono remains in full
compliance with regulation under
Health Canada. It is currently in the
pre-submission phase for a New
Drug Submission for the international
formulation of Z-71 Microbe Shield.
Laboratory testing associated with this
application is ongoing and coordinated
with the US EPA registration process.
Sales continue in Canada with a number
of active customers placing regular
orders and a number of new customers
in the onboarding phase. Zoono Canada
has also undertaken a number of pilots
with potential clients who are also
expected to place orders.
Several US Airlines are now purchasing
Zoono products following the up take by
United Airlines, as are Greyhound buses,
First Group, and several School Districts.
A number of companies are undertaking
their own trials, with positive results to
date and the new Californian distributor
placed orders for NZ$702k in December
2020.
11
After an extensive market evaluation,
Microsoft has invited Zoono to become
an approved supplier to their office
network. The initial purchase has been
received for their Redmond Campus
(comprising 125 buildings and 53,500 staff
in Washington State, USA), with the US
rollout to commence following the return
of staff to the Campus later this year.
Subsequent to the Company’s buy out
of its North American distributor (Zoono
Holdings USA Inc.) in November 2020,
it has generated NZ$1.8m in sales.
Sales have been adversely impacted
by restrictions imposed by US EPA on
the Company’s product claims, also
laboratory backlogs have cause delays
but with the pending EPA registration of
the “ Virus Kill and protect” claims, it is
expected that North America will be a
significant contributor to Group revenues
in the future.
Middle East and Africa (MENA)
During the year, the Dubai Central
Laboratory Department undertook
testing on Zoono’s Z-71 Microbe Shield
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Surface Sanitiser observing a complete
reduction of test bacteria (99.9%) on
all provided material surfaces over 30
days from the initial coating of Zoono
Z-71 Microbe Shied Surface Sanitizer
and Protectant except in rubber and
wood surfaces. The rubber and wood
surface has some viable growth on the
30th day, with a reduction of 90% of test
bacteria. Additional testing undertaken
by Intertek Caleb Brett in Dubai found a
100% reduction between the slide control
recovery level and Zoono Z-71 recovery
level at 24 hours, 7 days and 30 days.
Following receipt of the positive test
results and the Emirates Authority for
Standardisation and Metrology (ESMA)
Certificate of Conformity, Zoono entered
into a supply agreement during the
quarter with Fine Hygienic Paper LLC,
a FMCG business based in the UAE,
which allows them to develop and sell
their own label products utilising Zoono’s
Antimicrobial Technology into their
70-country network around the globe.
Fine Hygienic have already placed orders
for NZ$1.5m for the Middle East and
NZ$263k for the EU.
12
Zoono’s UAE distributer, International
Business Ventures LLC (IBV), continues
to gain additional customers for Zoono
products in the UAE, many following
the completion of trials. They are now
supplying the Dubai Metro and have
further trials underway, including with
a 5- star resort hotel, and a taxi trial
that commenced in February 2021. IBV
have also secured healthcare approval
for both Zoono Surface Sanitiser and
Hand Sanitiser which should open new
channels with hospitals.
Expo 2020 Dubai, which was postponed
due to COVID, commences on the 1st
October 2021 and runs for six months
to 31st March 2022. Zoono products are
being used to protect various pavilions at
this event.
South Africa continues to perform well.
Zoono is now registered with the South
African Health Products Regulatory
Authority which will open up the hospital
and medical sectors in this region.
Further distribution agreements are under
negotiation for Sri Lanka and Qatar and
initial orders have been placed for the
Kuwait market.
China
In China, Zoono has reshaped its
business, via a presence in the market,
to be based in Shanghai and managed
locally by Zoono’s Chinese Regional
Manager, Michael Wu. Zoono intends to
take direct control of its China business
and build a business development team
specifically for that business. The focus
will be relationships with channel partners
rather than utilising distributors, with
consequent expected benefits in the form
of reduced costs and better margins.
Zoono has signed a direct deal with Ali
Baba in China and will shortly be opening
an international online store on Ali Baba,
to be followed later this year by a TMall
flagship store. Zoono has also made
inroads into the hospital and school
markets in China.
During the year, China Health Committee
advised that Zoono’s hand sanitiser and
Femme products have been granted
registration and sales approval for
imported disinfection products in China.
In addition to the previously approved
surface sanitizer (All Purpose), Zoono
now has three products that have
been approved for sale by the Chinese
government. Among them, the hand
and surface products belong to a class
of disinfectants that can be used in
hospitals.
Zoono’s Z-71 was tested for air
disinfection by the Guangdong Detection
Centre of Microbiology (Report No:
2020FM08211R04) with very satisfactory
results. These results support the
promotion of Zoono’s application in
improving the indoor air quality for central
air conditioning and office buildings.
The Civil Aviation Administration of China
is currently in the process of arranging
approval procedures for use of Zoono
Z-71 on Chinese aircrafts. There are
currently 3,200 aircraft registered for flight
in China.
Zoono was selected as the only
disinfection and antibacterial product on
the procurement platform designated by
the Chinese Government where state-
owned enterprises purchase their office
supplies and employee welfare products.
Currently, the platform recommends
Zoono hand sanitizer 50ml as the main
product to be responding to the current
epidemic.
The Hong Kong market is maintaining
steady growth from key clients including
Cathay Pacific airline, hospitals and
property management companies that
have always had stable monthly orders.
Zoono has signed three (3) new
distribution agreements in China,
with NZ$10m in minimum contracted
sales targets over the next 18 months.
One agreement is in the textile sector,
another is in the hospital and medical
sector and the third is in the online sales
sector. Additional agreements are under
negotiation.
IDSMED, Zoono’s channel partner for
selected ASEAN countries, is making very
good progress and ordering regularly.
Zoono’s revised strategy (to build its
business in China via its own fully owned
subsidiary company and local sales team)
is beginning to pay off with China now
expected to be a material contributor to
Group revenues in FY22 and beyond.
Indonesia
Zoono’s hand sanitiser, GF24, and
surface sanitiser, Z-71, are both now
registered in Indonesia, opening up sales
in this country. Under the regional trade
agreement, potential exports to other
ASEAN countries are also possible relying
on these registrations.
Philippines
Following the registration and approval
of Zoono’s surface sanitiser, Z-71, in the
Philippines, Zoono’s local distributor,
IDSMED Philippines, have commenced
sales to local clients. They expect to
ramp up in 2022.
Australia/New Zealand
Zoono continues to receive regular orders
from Australia and New Zealand from all
current sectors in B2B and B2C. While
B2C is important, particularly for brand
awareness, the B2B sector remains the
primary focus and Zoono has gained a
number of new customers, in particular
from the transport industry (trains, metro
and airports).
One of the large facilities groups Zoono
works with has secured a supply
agreement for the Australian Defence
Force with supply now rolled out to 11
bases and a further five bases in train
before it is rolled out to other defence
buildings, including administration.
While sales are down in Australia and
New Zealand in both B2B and B2C
markets, some highlights for the year
include:
• Finalising the servicing of Australian
B2C markets from Melbourne via
a third- party packing and logistics
company (3PL), with resultant improved
delivery times and customer service.
• Zoono individual wipes have become
part of the Qantas “Fly Well”
programme (with the individually
wrapped wipes likely to be provided to
passengers on other global airlines in
the near future).
• Sales continue (via Zoono’s channel
partner, WINC) into the childcare /
education sectors, with more sectors,
including aged care and public
transport, also being targeted.
India
Zoono has recently appointed a new
Mumbai based distributor for India. It
has placed an initial order for 100,000
litres. Steps have also been taken in this
jurisdiction to minimize price gouging
which was a major issue with the previous
distributor.
Fiji
To help combat the Covid-19 outbreak in
Fiji, Zoono has donated 11,000 litres of
Zoono Microbe Shield Surface Sanitiser,
and circa 2,000 Litres of GermFree24
hand sanitiser and protectant to the
military in Fiji. Facilitated by the NZ
Defense Force and New Zealand Trade
& Enterprise, the donation builds on the
close relationship Zoono enjoys with Fiji.
NEW PRODUCT
During the quarter, Zoono launched
its triple layer, re-usable face mask in
Australia and New Zealand. Over 2,000
masks have been sold for over NZ$29k
in online consumer sales alone, with very
positive feedback.
MICROBE SHIELD SUCCESSFULLY
TESTS AGAINST HUMAN
CORONAVIRUS 229E
While Zoono’s Microbe Shield surface
sanitiser and GermFree24 hand
sanitiser products have previously been
successfully tested against the nominated
COVID surrogate feline coronavirus,
Zoono is pleased to advise that its
flagship product, Zoono Microbe Shield,
has now been successfully tested against
the Human Coronavirus 229E and now
meets the US EPA Standard ASTM
E1053.
Testing was completed by New Jersey
based Nelson Laboratories – an
independent Laboratory operating under
US FDA (GMP) regulations.
In the process of finalizing its product
approvals in Brazil, further testing of
Z-71 Microbe Shield was conducted
to European Standard EN14476:2019
and ASTM E1053 – 11, by the Virology
Laboratory, Institute of Biology, State
University Campus UNICAMP, Brazil (one
of the most highly regarded institutes in
Brazil).
and MERS), Influenza Virus A (H1N1) and
Norovirus (MNV).
To be classified as a ‘virucidal’, efficacy
of > 99.99% (4 Log) is required.
Tests included 30-day testing against
Coronavirus MHV-3, with different
strains and derivatives. Z-71 Microbe
Shield proved 99.99% efficacy against
Coronavirus MHV-3 after 30 days.
While these results will now allow Zoono
to make Coronavirus Surrogate MHV-
3 (same genus and family of species
SARS-CoV-1, SARS-CoV-2/COVID19
and MERS), Influenza Virus A (H1N1) and
Norovirus (MNV) claims in Brazil, more
importantly, they once again confirmed
the effectiveness of Zoono ZX71 Microbe
Shield across a 30-day period.
NEW DISTRIBUTORS / NEW SUPPLY
AGREEMENT
Subsequent to gaining regulatory
approvals, Zoono has appointed
new distribution partners in Norway,
Luxembourg, Greece and Poland. Initial
orders are pending in each country.
BOEING PARTNERS WITH ZOONO TO
DISTRIBUTE MICROBE SHIELD TO
AIRLINES GLOBALLY
Aircraft manufacturer Boeing has
partnered with Zoono to offer Zoono
products to airlines globally. Microbe
Shield meets Boeing Specification
Standard BSS7434 for use in aircraft
interiors and is now available from the
official Boeing on-line store.
The viruses tested were Coronavirus
strain MHV-3, Genus Betacoronavirus
(same genus and family of species
SARS-CoV-1, SARS-CoV-2/COVID19
PRODUCTION & IP PROTECTION
UPDATE
Zoono has now brought the production
of its plastic bottles ‘inhouse’. This
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will reduce its dependence on global
suppliers and remove one of the
production bottlenecks experienced
during 2020. Zoono expects to
commence the production of one million
bottles in the near future.
In order to further protect Zoono’s unique
technology, Zoono has recently lodged
further global patent applications in
relation to specialised applications.
13
To keep up to date with what is
happening globally on a day-to-day
basis, follow Zoono Global on Linkedin
at https://www.linkedin.com/company/
zoono/.
New Business
Opportunities
MOULD REMEDIATION -
TRANSPORTATION OF FRESH
PRODUCE
Trials have recently been conducted in
association with a leading corrugated
cardboard packaging manufacturer
in South Africa to demonstrate the
effectiveness of Zoono products in
preventing black mould growing on
cardboard packaging (a major issue in
the transportation of fresh produce) and
the produce from ripening prematurely.
The trials involved Zoono Microbe Shield
being sprayed on the packaging material
and within the shipping containers. As
part of the trial, before a container of a
shipment of citrus fruit left South Africa
(bound for Melbourne), Zoono treated
the packaging and the container. Despite
a two-week delay (with the container
stuck in the humidity of Singapore –
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an environment ideal for black mould
growth), the container and contents,
when inspected by independent
consultants in Melbourne, were 100%
clear of mould and the produce was
perfect.
Following its success, and while trials
and collection of robust scientific data
continue, commercial arrangements
have been completed as the packaging
company sees this as a potential solution
to an international problem.
Zoono has also entered into trials
with Australasia’s largest supplier of
containers for storage and portable
building use.
BUILDING SANITIZATION (USING
EXISTING AIR-CONDITIONING
INFRASTRUCTURE)
Zoono UK has entered into a strategic
partnership with a third party to develop
a unique delivery system for Zoono Z71
Microbe Shield utilizing the existing
air-conditioning infrastructure in large
buildings. The proprietary process
(owned by the third party) converts
Zoono to a gas which is then pumped
throughout a building through the
air-conditioning ducts. As the gasified
Zoono product is heavier than air, it
settles on (and treats) the surface which
it contacts and keeps the air conditioning
system lean as well, which is another
added benefit.
The delivery system, which is fully
automated, has the added benefit
of treating both the air and surfaces,
creates an efficient and cost-effective
solution for the safeguarding of
employees and customers. The
retrofitting of the necessary equipment
in existing buildings is also a relatively
simple process. Commercial interest in
the system has been received from a
large portfolio owner who owns about
150 buildings. Estimated volumes for a
5-6 story building are 300 to 500 litres
per building per month. First orders have
been received.
THE FOCUS
Moving forward, the Americas, UK/EU,
China/ASEAN, MENA/INDIA are Zoono’s
main focus, particularly in the B2B
markets. This includes Animal Health.
Financial
Performance
In the 12 months to 30 June 2021,
the Group experienced a decrease
in revenue of NZ$11,195,767 (29.2%
decrease) to NZ$27,133,602 compared
to FY20 year, largely caused by COVID
disruptions around the world and an
overordering of product in April 2020.
Gross profit achieved was
NZ$16,101,989 (59.3% of revenue)
in the current year compared to
NZ$28,333,608 (73.9% of revenue) in the
previous year.
The decrease in Gross Profit was directly
due to decreased revenues, and more
volume sales at lower gross margins
compared to the previous year.
Operating costs increased by
NZ$2,476,030 (30.6% increase)
compared to FY20 primarily as a result of
the increase in staffing levels for the UK
and US operations, regulatory testing in
the US, and an increase in the marketing
spend.
The consolidated Group net profit after
tax for the year was NZ$4,633,236
compared to a profit of NZ$16,659,442
in the previous year.
CASH GENERATION AND CAPITAL
MANAGEMENT
Operating cash flow was achieved
with a net cash inflow of NZ$1,483,421
in the current year, a decrease of
NZ$6,607,775 in the previous year.
This was predominately due to higher
staff costs of NZ$782,871 due to an
increase in headcount in the UK and
US operations, an increase in marketing
spend of NZ$392,125 and payment for
income tax of NZ$4,330,248.
difficult international climate.
On a consolidated basis, the Group
delivered:
• Revenue: NZ$27.1m -29.2% (FY20:
NZ$38.3m)
• EBITDA: NZ$6.3m -69.6% (FY20:
NZ$20.7m)
BALANCE SHEET
The Group continues to maintain a
strong balance sheet position with net
assets of NZ$21.1m compared to the
prior period of NZ$21.0m.
EMPLOYEE OPTIONS
During the year, no employee options
were issued to non-director employees.
Option holders do not have any rights to
participate in any issue of shares or other
interests of the Company or any other
entity.
SIGNIFICANT CHANGES IN THE
STATE OF AFFAIRS
There were no significant changes in the
state of affairs of the Group during the
financial year.
MATTERS SUBSEQUENT TO THE END
OF THE FINANCIAL YEAR
No other matters or circumstances have
arisen since the end of the financial
year which significantly affected or may
significantly affect the operations of the
consolidated group, the results of those
operations, or the state of affairs of the
consolidated group in future financial
years.
LIKELY DEVELOPMENTS,
PROSPECTS AND BUSINESS
STRATEGIES
The consolidated entity will continue
its strategy to focus on the progressive
expansion of the sale and marketing of
its product line.
A payment of NZ$765,405 was made
for stock and provision payments for the
acquisition of the US operation.
ENVIRONMENTAL REGULATIONS
The Group’s operations are minimally
affected by environmental regulations.
The Group ended the year with
NZ$4,899,929 in cash reserves
compared to NZ$10,323,216 in
the previous year, a decrease of
NZ$5,423,287 due to a dividend
payment of NZ$5,095,400 and payment
for income taxes of NZ$4,330,248.
NEW ACCOUNTING STANDARDS FOR
APPLICATION IN FUTURE PERIODS
The AASB has issued a number of new
and amended Accounting Standards
and Interpretations that have mandatory
application dates for future reporting
periods, some of which are relevant
to the Group. The Group has decided
not to early adopt any of the new and
amended pronouncement as the Group
assessed that the new and amended
pronouncements have no material
impact on the Group.
While the home markets, NZ and
Australia, are important, the volume the
big markets can deliver is our main focus.
DIVIDENDS
Dividends of NZ$5,095,400 were paid
during the financial year.
Zoono continues to aggressively go after
new businesses globally and remains
confident of delivering a year-end
revenue result that surpasses FY21.
FINANCIAL REVIEW
Zoono Group Limited continues to
make strategic, operational and financial
progress during the year, despite a
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JAMES LAFFERTY
FINE HYGIENIC
HOLDINGS
Customer
Highlight
Following the success of our Fine Guard Masks line, we strongly endorsed
extended life disinfection as a powerful idea for the global consumer. Why disinfect
conventionally which lasts merely minutes, when you can rest assured of longer-
lasting germ protection? So, as a company that embraces open source technology,
we embarked on a global search for best available technologies and partners.
Zoono was the clear choice for FHH. Great technology, coupled with an amazing
team, and a pedigree of customer satisfaction and independent third-party testing.
The Zoono partnership is a pillar of FHH’s future growth and IPO plans.
We see the current Covid-19 pandemic as a crucible moment in the world of
disinfection. The world will shift away from “instant, short-term disinfection”
provided by simple technologies like alcohol-based products, to enjoy the peace
of mind that comes from long-lasting disinfection technologies like Zoono. And we
envision Zoono at the forefront of this technological shift.
One of the most impressive things about Zoono is the literal plethora of
independent third-party studies on the efficacy of the technology. As we began
our global expansion, we encountered many governmental authorities who
were intrigued by the possibilities and yet wanted to do their own independent
verification. In every instance, the efficacy of Zoono products was validated and we
had yet another convinced audience!
In FHH, we currently sell actively in over 80 countries worldwide. We see our Fine
Guard Line, leveraging Zoono technology, as the backbone of extending this reach
to a target 100 countries by end-2022.
15
We have sold some of the world’s most prestigious customers. On the at-home
side, we are listing into the world’s leading retailers such as Carrefour in multiple
countries with excellent results. Institutionally, we have sold such high-profile
customers as Dubai Coca-Cola Arena, Hotel properties ranging from Marriott to
Kempinski, and leading restaurants and businesses in major global business hubs
from Dubai to Dusseldorf.
Information on Directors
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MS. ELISSA HANSEN
B.Comm, Grad Dip Applied Corporate
Governance, GAICD and FGIA
INDEPENDENT NON-EXECUTIVE
DIRECTOR
Elissa has over 23 years of experience
advising boards and management on
corporate governance, compliance,
investor relations and other corporate
related issues. She is a Chartered
Secretary who brings best practice
governance advice, ensuring compliance
with the Listing Rules, Corporations Act
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SPECIAL RESPONSIBILITIES:
Company Secretary; member of the Audit
and Risk Committee
INTERESTS IN SHARES AND OPTIONS:
276,000 Ordinary shares
DIRECTORSHIPS OF OTHER LISTED
COMPANIES IN THE PAST THREE
YEARS:
Non-Executive Director, QMines Limited
(appointed August 2020)
MR. DON CLARKE
LLB (Hons)
INDEPENDENT NON-EXECUTIVE
DIRECTOR
Don was a Partner of Minter Ellison’s
Melbourne Corporate Group, from 1988-
2015. He currently acts as a consultant to
them. Don has advised leading corporate
clients on broad corporation law issues
focused on equity capital markets, private
equity, mergers and acquisitions and
corporate restructures.
He is able to draw on his first-hand
experience as a corporate lawyer
and a Director, of Directors’ duties
and responsibilities and best practice
corporate governance, when advising on
the legal and practical issues faced at
head office and board level.
SPECIAL RESPONSIBILITIES:
Chairman of the Audit and Risk
Committee
INTERESTS IN SHARES AND OPTIONS:
270,000 Ordinary shares
DIRECTORSHIPS OF OTHER LISTED
COMPANIES IN THE PAST THREE
YEARS:
Non-Executive Director, Webjet Limited
(appointed January 2008)
Non-Executive Director, Contango
Income Generator Limited (appointed
August 2014, resigned 26 October 2020)
16
MR. PAUL HYSLOP
MANAGING DIRECTOR
Paul founded Zoono Group in 2007 to
address the need for a highly effective,
alternative method of combating bacteria
and microbes and quickly realised the
business opportunity surrounding this
technology. Prior to establishing Zoono,
Paul was involved in several successful
entrepreneurial ventures ranging from
the establishment of a successful private
car sales business in Auckland in 1990,
to real estate development and business
brokerage. He also set up a franchise
business in the USA 2002 – 2005.
Extremely adept at dealing with
businesses and consumers alike, he
co-established the Business Brokerage
Division at Bayley’s Real Estate – one
of the largest real estate and business
brokerages in New Zealand, where he
was twice awarded the “Salesman of the
Year” award.
Paul’s experience in business
development dates back to the 1970s,
when he started a personal-care services
business after high school, grew it
into eight locations and later sold it
to his employees. He has also been a
commercial flying instructor and Airline
pilot, having flown commuter planes for
Eagle Air, owned by Air New Zealand.
SPECIAL RESPONSIBILITIES:
Managing Director
INTERESTS IN SHARES AND OPTIONS:
59,558,000 Ordinary shares
DIRECTORSHIPS OF OTHER LISTED
COMPANIES IN THE PAST THREE
YEARS:
None.
MEETINGS OF DIRECTORS
The number of board meetings of Zoono Group Limited directors held during the
financial year ended 30 June 2021, and the number of meetings attended by each
director were:
DIRECTORS
MEETINGS
AUDIT & RISK COMMITTEE
MEETINGS
ATTENDED
ELIGIBLE TO ATTEND
ATTENDED
ELIGIBLE TO ATTEND
Paul Hyslop
Don Clarke
Elissa Hansen
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4
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4
4
-
2
2
-
2
2
INDEMNIFICATION AND INSURANCE OF DIRECTORS, OFFICERS AND AUDITOR
The Group has entered into an agreement to indemnify directors and officers during
the financial year and has taken out an insurance policy to insure each of the directors
and officers or former directors and officers against liabilities for costs and expenses
incurred by them in defending any legal proceedings arising out of their conduct while
acting in the capacity of director or officer of the Group, other than conduct involving
a willful breach of duty in relation to the Group. Indemnity has not been provided for
auditors. Insurance premiums of NZ$243,856 have been paid or accrued by the Group.
REGULATION
Zoono and it proposed products are subject to various laws and regulations including
but not limited to accounting standards, tax laws, environmental laws, product
content requirement, labelling/packaging, regulations and customs regulations.
Changes in these laws and regulations (including interpretation and enforcement)
could adversely affect the Group financial performance. Laws and regulations are
specific to each geographic location. In this regard, there is a risk that a certain
product may not be able to be supplied in another jurisdiction because it fails to meet
that jurisdictions regulatory requirements (e.g. product registration requirements).
Failure of the Group to remain up to date with these various regulatory requirements
could adversely affect the Group financial performance.
There were no regulatory issues that arose during the 12 months to 30 June 2021.
PROCEEDINGS ON BEHALF OF THE GROUP
Qingdao Zoono Biotech Ltd (QZB) was formerly Zoono’s distributor in China. In this
dispute, QZB claims that Zoono Limited breached its contract with QZB, and that
Mr Paul Hyslop deceived QZB during negotiations. QZB seeks damages totaling
USD$390,000, interest on that sum and costs. Zoono Limited and Zoono Group
Limited have both brought a counterclaim against QZB and its director Lingchen
Qi – Zoono Limited’s counterclaim is against QZB for breaches of contract, against
Mr Qi for misrepresentation and breach of contract and Zoono Group Limited’s
counterclaim is against Mr Qi for breach of contract, misrepresentation and inducing
breach of contract.
The Group’s insurer has accepted the claim and our liability is limited to a deductible
of NZ$50,000 which has already been expensed in the financial statements.
This proceeding is currently stayed, as QZB has failed to pay the first instalment
of security for costs and we have not heard from them for fifteen months. This
proceeding will remain stayed until QZB makes this payment, however we consider
there is a low risk that QZB will make this payment. On that basis, we do not expect
to incur further fees until instructed by Zoono.
Sky Scrapers General Trading LLC (Sky Scrapers) was formerly Zoono’s exclusive
distributor in UAE, Oman and Lebanon. In this dispute, Sky Scrapers claims that
Zoono breached its contract with Sky Scrapers and seeks either specific performance
of the contract or damages of at least USD$3,500,000. Zoono Limited has brought a
counterclaim against Sky Scrapers also for breach of contract, and has also sought
rectification of the contract. While Sky Scrapers has brought a claim against Zoono
Group Limited, Zoono Group Limited is not a party to the contract, nor is there any
apparent claim against Zoono Group Limited in Sky Scrapers’ statement of claim. The
Company has taken further independent senior legal advice and the opinion is we
have limited exposure under these claims.
The parties have currently completed
discovery and have started inspection.
The next steps will be to prepare
evidence. A hearing has been set down
for one week from 23 May 2022.
CORPORATE GOVERNANCE
The directors are responsible for the
corporate governance practices of the
Group.
The main corporate governance practices
that were in operation during the
financial year are set out in the Corporate
Governance section of the Company’s
website at http://zoono.com/corporate-
governance/.
NON-AUDIT SERVICES
The directors are satisfied that the
provision of non-audit services during
the year is compatible with the general
standard of independence for auditors
imposed by the Corporations Act
2001. The directors are satisfied that
the services disclosed below did not
compromise the external auditor’s
independence for the following reasons:
• all non-audit services are reviewed
and approved by the full board prior
to commencement to ensure they do
not adversely affect the integrity and
objectivity of the auditor; and
the nature of the services provided
•
do not compromise the general principles
relating to auditor independence in
accordance with APES 110: Code of
Ethics for Professional Accountants
set by the Accounting Professional and
Ethical Standards Board.
There were no non-audit services
rendered during the year ended 30 June
2021.
An independence declaration has been
provided by the Group’s auditor, Hall
Chadwick. A copy of this declaration
is attached to, and forms part of, the
financial report for the financial year
ended 30 June 2021.
Signed in accordance with a resolution of
the directors.
PAUL HYSLOP
MANAGING DIRECTOR/CEO
17
ZOONO GROUP LIMITED ANNUAL REPORT 2021
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Remuneration
Report (Audited)
THE REMUNERATION REPORT IS SET OUT UNDER THE FOLLOWING MAIN HEADINGS:
1.
2.
3.
4.
PRINCIPLES USED TO DETERMINE THE NATURE AND AMOUNT OF REMUNERATION
DETAILS OF REMUNERATION
SERVICES AGREEMENTS
SHARE-BASED COMPENSATION
THE INFORMATION PROVIDED UNDER HEADINGS 1 TO 4 INCLUDES REMUNERATION DISCLOSURES THAT ARE
REQUIRED UNDER ACCOUNTING STANDARD AASB 124 RELATED PARTY DISCLOSURES. THESE DISCLOSURES HAVE
BEEN TRANSFERRED FROM THE FINANCIAL REPORT AND HAVE BEEN AUDITED.
18
1. PRINCIPLES USED TO DETERMINE
THE NATURE AND AMOUNT OF
REMUNERATION
The performance of the consolidated
group depends upon the quality and
commitment of the directors and
executives. The philosophy of the
directors in determining remuneration
levels is to:
• set competitive remuneration
packages to attract and retain high
•
calibre employees;
link executive rewards to shareholder
value creation; and
• establish appropriate demanding
performance hurdles for variable
executive remuneration.
Given the small size of the Group’s board,
and the current development stage of
the Company, a separate Remuneration
Committee has not been established to
review and make recommendations to the
full Board on the Group’s remuneration
policies, procedures and practices. As
the Company develops, the Group may
establish a Remuneration Committee to
undertake this role.
The full Board oversees the Group
remuneration policies, procedures and
practices and defines the individual
packages offered to executive directors
and key management personal.
The board may consider engaging an
independent remuneration consultant, to advise the board on appropriate levels of
remuneration relative to its industry peer group.
In accordance with Corporate Governance best practice (Recommendation 8.2),
the structure of non- executive director and executive remuneration is separate and
distinct as follows.
A. Non-executive Directors’ Remuneration Fixed Remuneration:
The Board seeks to set non-executive directors’ remuneration at a level that provides
the Group with the ability to attract and retain directors of a high calibre, whilst
incurring a cost that is acceptable to shareholders.
The ASX Listing Rules specify that the aggregate remuneration of non-executive
directors shall be determined from time to time by a general meeting. The amount of
aggregate remuneration and the manner in which it is apportioned amongst directors
is reviewed annually. The Board considers advice from shareholders and takes into
account the fees paid to non-executive directors of comparable companies, when
undertaking the annual review process.
Directors’ remuneration is inclusive of committee fees. The following net annual fees
paid to non- executive directors are
FIXED FEES
(NZ$)
1 JULY 2020 - 30 JUNE 2021
$
1 JULY 2019 - 30 JUNE 2020
$
Chairman’s Fee
Base Fee
Non-executive directors
$84,9131
$84,9132
-
$65,2312
NOTES:
1. The net annual fee paid to the Chairman was AU$80,000 and has been
converted at an average exchange rate of 1.0614 (2020: Nil).
2. The net annual fee was AU$80,000 (2020: AU$61,667) to each director and has
been converted at an average exchange rate of 1.0614 (2020: 1.0578).
B. Company Executive and Executive Director Remuneration:
Remuneration for executives and executive directors consists of fixed remuneration, short-term incentive payments and options
issued.
Fixed Remuneration:
Fixed remuneration is reviewed annually by the directors. The process consists of a review of relevant comparative remuneration
in the employment market and within the Group. The Group may engage an independent remuneration consultant, to advise the
board on appropriate levels of remuneration for the Group’s Executive Directors relative to its industry peer group.
2. DETAILS OF REMUNERATION
Details of the remuneration of the Key Management Personnel (as defined in AASB 124 Related Party Disclosures) are set out in
Table 1 which follows.
The Key Management Personnel of Zoono Group Limited, including the directors and the following consolidated group
executives, have authority and responsibility for planning, directing and controlling the activities of the consolidated group.
Lew MacKinnon -
-
Paul Ravlich
Group Chief Operating Officer
Group Chief Financial Officer
These executives together with the directors comprise the named relevant consolidated group executives who make or
participate in making decisions that affect the whole, or a substantial part, of the business or who have the capacity to affect
significantly the Group’s financial standing.
TABLE 1: DETAILS OF REMUNERATION – DIRECTORS AND KEY MANAGEMENT PERSONNEL.
SHORT-TERM
BENEFITS
OTHER
BENEFITS
SHARE BASED
PAYMENTS
TOTAL
Cash Salary
& Fees
$NZD
STI
Payments
$NZD
Termination
Benefits
$NZD
Prescribed
Benefits
$NZD
Shares
$NZD
$NZD
PERCENTAGE
PERFORMANCE
BASED BONUS
PAYMENTS
PERCENTAGE
SHARE-BASED
PAYMENTS
19
Year ended 30 June 2021
Executive directors
Paul Hyslop
Non-Executive directors
Don Clarke
Elissa Hansen
Other key management personnel
Lew MacKinnon
Paul Ravlich
Total
Year ended 30 June 2020
Executive directors
Paul Hyslop
Non-Executive directors
Don Clarke
Elissa Hansen
Other key management personnel
Lew MacKinnon
Paul Ravlich
Total
480,000
84,913
84,913
124,615
221,800
996,241
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
480,000
84,913
84,913
10,329
6,102
74,998
52,498
209,942
280,400
16,431
127,496
1,140,168
-
-
-
-
-
-
-
-
-
35.72%
18.72%
11.18%
SHORT-TERM
BENEFITS
OTHER
BENEFITS
SHARE BASED
PAYMENTS
TOTAL
Cash Salary
& Fees
$NZD
STI
Payments
$NZD
Termination
Benefits
$NZD
Prescribed
Benefits
$NZD
Shares
$NZD
$NZD
PERCENTAGE
PERFORMANCE
BASED BONUS
PAYMENTS
PERCENTAGE
SHARE-BASED
PAYMENTS
377,938
50,000
65,231
65,231
-
-
124,415
201,800
7,000
-
836,615
57,000
-
-
-
-
-
-
-
-
-
-
6,102
6,102
-
-
-
-
-
-
427,938
11.68%
65,231
65,231
224,921
271,956
-
-
3.11%
-
1,055,277
5.40%
-
-
-
40.68%
23.55%
14.74%
ZOONO GROUP LIMITED ANNUAL REPORT 2021
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3. SERVICE AGREEMENTS
INDEPENDENT REVIEW
To ensure the Group complied with industry best practice in relation to the
remuneration of its executive directors, the non-executive directors of the Group
will consider engaging the services of a remuneration consultant to conduct an
independent assessment of the remuneration packages negotiated with its executive
director.
The following is a summary of the current major provisions of the agreements relating
to remuneration of Executive Directors in NZ Dollars:
PAUL HYSLOP
MANAGING DIRECTOR
Paul Hyslop is the Managing Director of the Group and is considered a key member
of the Group’s management team. Paul is founder of Zoono.
Employment Conditions
Commencement Date:
Term:
Review:
26 April 2017
Two years
Annually
LEW MACKINNON
CHIEF OPERATIONS OFFICER
Base Remuneration:
Other Benefits:
$120,000
Use of a company vehicle.
Employment Conditions
Commencement Date:
Term:
Review:
1 June 2017
One year
Annually
Share options of 500,000 were issued on 16 December 2019, vesting on 16
December 2020, exercisable at A$0.25 and expiring 16 December 2023.
20
PAUL RAVLICH
CHIEF FINANCIAL OFFICER
Base Remuneration:
Other Benefits:
$220,000
Entitlement to a cash payment of up to $40,000 contingent
on the Group achieving budgeted results in the year.
Employment Conditions
Commencement Date:
Term:
Review:
1 May 2017
One year
Annually
Share options of 350,000 were issued on 16 December 2019, vesting on 16
December 2020, exercisable at A$0.25 and expiring 16 December 2023.
4. VOTING AND COMMENTS MADE AT THE COMPANY LAST ANNUAL GENERAL
MEETING
The resolution to adopt Zoono Group Limited’s Remuneration Report for the financial
year ended 30 June 2020 was passed by way of a poll with a 99% ‘yes’ vote. The
Company received no specific feedback on Remuneration Report either at the Annual
General Meeting or at other times.
Auditor’s Independence
Declaration
21
ZOONO GROUP LIMITED ANNUAL REPORT 2021 1
2
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Consolidated Statement
of Profit and Other
Comprehensive Income
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2021
Revenue
Cost of sales
Gross profit
Other revenue
Administration expenses
Depreciation and amortisation expenses
Directors’ fees
Employee costs
Finance costs
Management fees
Professional fees
Share based payments
Selling and distribution expenses
Marketing expenses
22
Listing expenses and other acquisition costs
Compliance costs
Other expenses
Profit before income tax
Income tax expense
Profit after income tax
Other comprehensive income:
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations
Total other comprehensive income
Total comprehensive income
Profit attributable to:
Owners of the parent entity
Non-controlling interest
Total comprehensive income attributable to:
Owners of the parent entity
Non-controlling interest
Earnings per share attributable to the
ordinary equity holders of the company
Basic earnings per share (cents)
Diluted earnings per share (cents)
The accompanying notes form part of these financial statements
NOTES
5
5
7
6
23
23
2021
NZ$
27,133,602
(11,031,613)
16,101,989
366,333
(1,059,598)
(359,829)
(169,825)
(2,961,971)
(75,221)
(480,000)
(1,873,872)
(299,991)
(1,399,278)
(660,097)
(94,503)
(104,601)
(1,031,583)
5,897,953
(1,264,717)
4,633,236
104,641
104,641
4,737,877
4,732,470
(99,234)
4,633,236
4,838,912
(101,035)
4,737,877
2.89
2.87
2020
NZ$
38,329,369
(9,995,761)
28,333,608
170,778
(101,738)
(197,437)
(129,859)
(2,179,100)
(52,559)
(430,006)
(1,098,020)
(366,026)
(1,748,361)
(267,972)
(206,528)
-
(1,314,731)
20,412,049
(3,752,607)
16,659,442
(538,246)
(538,246)
16,121,196
16,659,442
-
16,659,442
16,121,196
-
16,121,196
10.20
10.13
Consolidated Statement
of Financial Position
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2021
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Inventories
Other assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Plant and equipment
Intangible assets
Right of use assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Lease liabilities
Current tax liabilities
Provisions
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Lease liabilities
Provisions
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated profits
Equity attributable to owners of the parent entity
Non-controlling interest
TOTAL EQUITY
NOTES
22(a)
8
9
13
10
11
12
14
12
15
12
15
16
17
2021
NZ$
2020
NZ$
4,899,929
5,295,956
12,863,790
195,875
23,255,550
737,064
5,693,781
2,015,266
8,446,111
31,701,661
2,213,445
342,527
687,076
92,886
3,335,934
1,732,334
5,559,467
7,291,801
10,627,735
21,073,926
12,841,407
96,298
8,237,256
21,174,961
(101,035)
21,073,926
10,323,216
9,229,419
13,202,029
176,027
32,930,691
229,355
37,226
1,500,255
1,766,836
34,697,527
8,419,895
23
201,157
3,752,607
-
12,373,659
1,359,022
-
1,359,022
13,732,681
20,964,846
12,461,800
(97,140)
8,600,186
20,964,846
-
20,964,846
The accompanying notes form part of these financial statements
ZOONO GROUP LIMITED ANNUAL REPORT 2021
Consolidated Statement
of Changes in Equity
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2020
ISSUED
CAPITAL
RESERVES
ACCUMULATED
PROFITS
TOTAL
1
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NZ$
NZ$
(8,043,633)
3,852,587
(15,623)
(15,623)
(8,059,256)
3,836,964
16,659,442
16,659,442
-
(538,246)
16,659,442
16,121,196
-
-
-
640,660
366,026
1,006,686
8,600,186
20,964,846
NOTE
ORDINARY
SHARES
NZ$
FOREIGN
CURRENCY
TRANSLATION
NZ$
SHARE BASED
PAYMENT
RESERVE
NZ$
Balance at 1 July 2019
11,821,140
75,080
Cumulative adjustments upon
adoption of new accounting
standard – AASB 16
-
-
Balance at 1 July 2019 (restated)
11,821,140
75,080
Profit for the year
Other comprehensive income
for the year
Total comprehensive income
for the year
24
Transactions with owners in their
capacity as owners:
Shares issued during the year,
net of issue costs
Share based payments
Total transactions with owners
-
-
-
-
(538,246)
(538,246)
16
17
640,660
-
640,660
-
-
-
Balance at 30 June 2020
12,461,800
(463,166)
-
-
-
-
-
-
-
366,026
366,026
366,026
The accompanying notes form part of these financial statements
Consolidated Statement
of Changes in Equity
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2021
ISSUED
CAPITAL
RESERVES
ACCUMULATED
PROFITS
NON-
CONTROLLING
INTEREST
TOTAL
NOTE
ORDINARY
SHARES
NZ$
FOREIGN
CURRENCY
TRANSLATION
NZ$
SHARE BASED
PAYMENT
RESERVE
NZ$
NZ$
NZ$
NZ$
Balance at 1 July 2020
12,461,800
(463,166)
366,026
8,600,186
-
20,964,846
Profit/(loss) for the year
Other comprehensive income
for the year
Total comprehensive income
for the year
Transaction with owners in
their capacity as owners:
Dividends paid
Shares issued on exercise of options
Transfer from reserve on exercise
of options
Share based payments
Total transaction with owners
25
16
16
17
-
-
-
-
-
166,612
212,995
-
379,607
-
106,442
106,442
-
-
-
-
-
-
-
-
-
-
(212,995)
299,991
4,732,470
(99,234)
4,633,236
-
(1,801)
104,641
4,732,470
(101,035)
4,737,877
(5,095,400)
-
-
-
86,996
(5,095,400)
-
-
-
-
-
(5,095,400)
166,612
25
-
299,991
(4,628,797)
Balance at 30 June 2021
12,841,407
(356,724)
453,022
8,237,256
(101,035)
21,073,926
The accompanying notes form part of these financial statements
ZOONO GROUP LIMITED ANNUAL REPORT 2021
Consolidated Statement
of Cash Flows
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2021
NOTES
2021
NZ$
2020
NZ$
30,675,724
(24,889,872)
103,038
(75,221)
(4,330,248)
1,483,421
(585,947)
(765,405)
(1,351,352)
166,612
(258,531)
(5,095,400)
(5,187,319)
(5,055,250)
(368,037)
10,323,216
4,899,929
22(b)
15
22(a)
30,998,938
(22,946,152)
90,969
(52,559)
-
8,091,196
(137,398)
-
(137,398)
-
(195,975)
-
(195,975)
7,757,823
(559,935)
3,125,328
10,323,216
1
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CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts from customers
Payments to suppliers and employees
Interest received
Finance cost
Income taxes paid
Net cash provided by operating activities
CASH FLOWS FROM INVESTING ACTIVITIES:
Payments for plant and equipment and intangible assets
Payments for acquisition of business
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES:
26
Proceeds from the exercise of options
Repayment of borrowings and lease liabilities
Dividends paid
Net cash used in financing activities
Net increase/(decrease) in cash held
Effects of foreign exchange on cash balances
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
The accompanying notes form part of these financial statements
Notes to the
Financial Statements
1. NATURE OF OPERATIONS
Zoono Group Limited and Subsidiaries
(the Group) principal activities included
the research, development and sale
of a range of antimicrobial products in
multiple countries.
2. GENERAL INFORMATION AND
STATEMENT OF COMPLIANCE
The consolidated financial statements
are a general-purpose financial report
that has been prepared in accordance
with Australian Accounting Standards,
Australian Accounting Interpretations,
other authoritative pronouncements of
the Australian Accounting Standards
Board and the Corporations Act 2001.
Compliance with Australia Accounting
Standards results in full compliance with
the International Financial Reporting
Standards (‘IFRS’) as issued by the
International Accounting Standards
Board (IASB). For the purposes of
preparing the Consolidated Financial
Statement, the Company is a for-profit
entity.
Zoono Group Limited (the Company) is
the Ultimate Parent Company, Zoono
Group Limited is a Public Company
incorporated in Australia and domiciled
in New Zealand. The Company
registered address is Level 12, 225
George Street Sydney NSW 2000
Australia.
The Consolidated financial statements of
the Group as at and for the year ended
30 June 2021 comprise the Company
and its subsidiaries (together referred to
as the ‘Group’ or ‘Consolidated entity’).
The consolidated financial statements
for the year ended 30 June 2021 were
approved and authorised for issue by the
board of Directors on 26 August 2021.
Except for cash flow information, the
consolidated financial statements have
been prepared on an accrual basis and
are based on historical costs modified,
where applicable, by the measurements
at fair value of selected non-current
assets, financial assets and financial
liabilities.
Statement of Cash Flows
The statement of cash flows comprises
the cash balance of Zoono Limited,
Zoono Group Limited and Zoono
Holdings Limited at the beginning of the
financial year, and the cash transactions
of the consolidated Group for the
12-month period.
3. CHANGES IN ACCOUNTING
POLICIES
(a) New Standards adopted
by the Group
Initial adoption of AASB 2020-04:
COVID-19-Related Rent Concessions
AASB 2002-4: Amendments to Australian
Accounting Standards – COVID-19-
Related Rent Concessions amends
AASB 16 by providing a practical
expedient that permits lessees to assess
whether rent concessions that occur as
a direct consequence of the COVID-19
pandemic and, if certain conditions are
met, account for those rent concessions
as if they were not lease modifications.
Initial adoption of AASB 2018-6:
Amendments to Australian Accounting
Standards – Definition of a Business
AASB 2018-6 amends and narrows
the definition of a business specified
in AASB 3: Business Combinations,
simplifying the determination of whether
a transaction should be accounted for
as a business combination or an asset
acquisition. Entities may also perform
a calculation and elect to treat certain
acquisitions as acquisitions of assets.
The standards listed above did not have
any impact on the amounts recognised
in prior periods and are not expected to
significantly affect the current or future
periods.
(b) New Accounting Standards for
application in future periods
The AASB has issued a number of new
and amended Accounting Standards
and Interpretations that have mandatory
application dates for future reporting
periods, some of which are relevant
to the Group. The Group has decided
not to early adopt any of the new and
amended pronouncements as the Group
assessed that the new and amended
pronouncements have no material
impact on the Group.
4. SUMMARY OF
ACCOUNTING POLICIES
The following significant accounting
policies have been adopted in the
preparation and presentation of the
financial report.
(a) General
Material accounting policies adopted in
the preparation of this financial report
are presented below and have been
consistently applied unless otherwise
stated.
Reporting basis and conventions
These financial statements have been
prepared on an accruals basis under the
historical cost convention, as modified
by the financial assets and liabilities at
fair value.
Critical accounting estimates and
judgements
The preparation of a financial report in
conformity with Australian Accounting
Standards requires management to make
estimates, judgements and assumptions
based on historical knowledge and best
available current information. Estimates
assume a reasonable expectation of
future events and are based on current
trends and economic data obtained both
externally and within the Group. Actual
results may differ from these estimates.
Impairment
In assessing impairment, management
estimates the recoverable amount of
each asset or cash generating unit based
on expected future cash flows and,
where required, uses an interest rate to
discount them.
Estimation uncertainty relates to
assumptions about future operating
results and the determination of a
suitable discount rate.
Inventories
Management estimates the net realisable
values of inventories, taking into account
the most reliable evidence available
at each reporting date. The future
realization of these inventories may be
affected by market-driven changes that
may reduce future selling prices.
Business combinations
Management uses valuation techniques
in determining the fair value of the
various elements of a business
combination. Particularly, the fair value
of contingent consideration is dependent
on the outcome of many variables that
effect future profitability.
27
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28
(b) Basis of Consolidation
The consolidated financial statements
incorporate all of the assets, liabilities
and results of Zoono Group Limited and
all subsidiaries as of 30 June 2021.
Subsidiaries are all entities over which
the Group has control. The Group
controls an entity when it is exposed to,
or has rights to, variable returns from its
involvement with the entity and has the
ability to affect those returns through its
power to direct the activities of the entity.
The assets, liabilities and results of
all subsidiaries are fully consolidated
into the financial statements of
the Group from the date on which
control is obtained by the Group.
The consolidation of a subsidiary is
discontinued from the date that control
ceases.
Intercompany transactions, balances
and unrealised gains or losses on
transactions between group entities are
fully eliminated on consolidation.
Accounting policies of subsidiaries have
been changed and adjustments made
where necessary to ensure uniformity of
the accounting policies adopted by the
Group.
Equity interests in a subsidiary not
attributable, directly or indirectly, to
the Group are presented as “non-
controlling interests”. The Group initially
recognises non-controlling interests
that are present ownership interests
in subsidiaries and are entitled to a
proportionate share of the subsidiary’s
net assets on liquidation at either fair
value or at the non-controlling interests’
proportionate share of the subsidiary’s
net assets. Subsequent to initial
recognition, non-controlling interests
are attributed their share of profit or
loss and each component of other
comprehensive income. Non-controlling
interests are shown separately within
the equity section of the statement
of financial position and statement of
comprehensive income.
(c) Business combinations
The Group applies the acquisition
method in accounting for business
combinations. The consideration
transferred by the Group to obtain
control of a subsidiary is calculated as
the sum of the acquisition date of fair
values of assets transferred, liabilities
incurred and the equity interests
issued by the Group, which includes
the fair value of any asset or liability
arising from a contingent consideration
arrangement. Acquisition costs are
expensed as incurred.
The Group recognises identifiable assets
acquired and liabilities assumed in a
business combination regardless of
whether they have been previously
recognised in the acquiree’s financial
statements prior to the acquisition.
Group companies
The financial results and position of
foreign operations whose functional
currency is different from the Group’s
presentation currency is translated as
follows:
Assets acquired and liabilities assumed
are generally measured at their
acquisition-date fair values.
• Assets and liabilities are translated
at year end exchange rates prevailing
at that reporting date.
Goodwill is stated after separate
recognition of identifiable intangible
assets. It is calculated as the excess of
the sum of: (a) fair value of consideration
transferred, (b) the recognised amount
of any non-controlling interest in the
acquiree, and (c) acquisition-date fair
value of any existing equity interest in
the acquiree, over the acquisition-date
fair values of identifiable net assets. If
the fair values of identifiable net assets
exceed the sum calculated above, the
excess amount (i.e. gain on a bargain
purchase) is recognised in profit or loss
immediately.
(d) Foreign Currency Transactions and
Balances Functional and presentation
currency
The functional currency of each of the
Group entities is measured using the
currency of the primary economic
environment in which that entity
operates.
The consolidated financial statements
are presented in New Zealand dollars,
which is the parent entity’s functional
and presentation currency.
Transactions and balances
Foreign currency transactions are
translated into functional currency using
the exchange rates prevailing at the
date of the transaction. Foreign currency
monetary items are translated at the
year- end exchange rate. Non-monetary
items measured at historical cost
continue to be carried at the exchange
rate at the date of the transaction. Non-
monetary items measured at fair value
are reported at the exchange rate at the
date when fair values were determined.
Exchange differences arising on the
translation of monetary items are
recognised in profit or loss, except where
deferred in equity as a qualifying cash
flow or net investment hedge.
Exchange differences arising on
the translation of non-monetary
items are recognised directly in other
comprehensive income to the extent that
the underlying gain or loss is recognised
in other comprehensive income;
otherwise the exchange difference is
recognised in profit or loss.
Income and expenses are translated
•
at average exchange rates for the
year.
• Retained earnings/Accumulated
losses are translated at the exchange
rates prevailing at the date of the
transaction.
Exchange differences arising on
translation of foreign operations with
functional currencies other than the
Australian dollar are recognised in other
comprehensive income and included in
the foreign currency translation reserve
in the statement of financial position. The
cumulative amount of these differences is
reclassified into profit or loss in the period
in which the operation is disposed of.
(e) Cash and cash equivalents
Cash and cash equivalents includes
cash on hand, deposits held at call with
banks and other short- term highly liquid
investments with original maturities of
three months or less that are readily
convertible to known amounts of cash
and which are subject to an insignificant
risk of changes in value.
(f) Income tax
The charge for current income tax
expense is calculated by reference to
the amount of income taxes payable
or recoverable in respect of the
taxable profit or loss for the period. It
is calculated using the tax rates that
have been enacted or are substantially
enacted by the reporting date.
Deferred tax is accounted for using the
liability method in respect of temporary
differences arising between the tax
bases of assets and liabilities and
their carrying amounts in the financial
statements. No deferred income tax will
be recognised from the initial recognition
of an asset or liability, excluding a
business combination, where there is no
effect on accounting or taxable profit or
loss.
Deferred tax is calculated at the tax rates
that are expected to apply to the period
when the asset is realised or liability is
settled. Deferred tax is charged to the
statement of profit or loss and other
comprehensive income except where
it relates to items that may be credited
directly to equity, in which case the
deferred tax is adjusted directly against
equity.
Deferred income tax assets are
recognised to the extent that it is
probable that future tax profits will
be available against which deductible
temporary differences can be utilised.
Current tax assets and liabilities are
offset where a legally enforceable right of
set-off exists and it is intended that net
settlement or simultaneous realisation
and settlement of the respective asset
and liability will occur. Deferred tax
assets and liabilities are offset where a
legally enforceable right of set-off exists,
the deferred tax assets and liabilities
relate to income taxes levied by the
same taxation authority on either the
same taxable entity or different taxable
entities where it is intended that net
settlement or simultaneous realisation
and settlement of the respective asset
and liability will occur in future periods in
which significant amounts of deferred tax
assets or liabilities are expected to be
recovered or settled.
The amount of benefits brought to
account or which may be realised in
the future is based on the assumption
that no adverse change will occur in
income taxation legislation and the
anticipation that the consolidated entity
will derive sufficient future assessable
income to enable the benefit to be
realised and comply with the conditions
of deductibility imposed by the law.
(g) Inventories
Inventories are measured at the lower of
cost and net realisable value. The cost of
manufactured products includes direct
materials, direct labour and freight. Costs
are assigned on a first-in first-out basis.
Net realisable value is the estimated
selling price in the ordinary course of
business less any applicable selling
expenses.
(h) Property, plant and equipment
Plant and equipment are measured
on the cost basis less accumulated
depreciation and impairment losses.
Subsequent costs are included in the
asset’s carrying amount or recognised
as a separate asset, as appropriate, only
when it is probable that future economic
benefits associated with the item will
flow to the Group and the cost of the
item can be measured reliably.
All other repairs and maintenance are
charged to the profit or loss during
the financial period in which they are
incurred. All fixed assets are depreciated
over their estimated useful lives to the
Group.
The depreciation rates used for each
class of depreciable assets are:
CLASS OF DEPRECIATION
FIXED ASSET
RATE
Plant and equipment
10 – 33%
Motor vehicles
30%
Furniture and equipment
13 – 33%
Computer equipment
48 – 67%
Depreciation
The assets’ residual values and useful
lives are reviewed, and adjusted if
appropriate, at each reporting date. An
asset’s carrying amount is written down
immediately to its recoverable amount
if the asset’s carrying amount is greater
than its estimated recoverable amount.
Gains and losses on disposals are
determined by comparing proceeds with
the carrying amount. These gains and
losses are included in the profit or loss
within other income or expenses.
(i) Intangible Assets
Patents, trademarks and website
development are recognised at cost
of acquisition. They have a finite
life and are carried at cost less any
accumulated amortisation and any
impairment losses. Patents, trademarks
and website development are amortised
over their useful lives of up to 10
years. Amortisation has been included
within depreciation, amortisation and
impairment of non-financial assets.
(j) Impairment of Assets
At the end of each reporting period, the
Group assesses whether there is any
indication that an asset may be impaired.
The assessment will include considering
external sources of information and
internal sources of information including
dividends received from subsidiaries,
associates or joint ventures deemed to
be out of pre-acquisition profits. If such
an indication exists, an impairment test
is carried out on the asset by comparing
the recoverable amount of the asset,
being the higher of the asset’s fair
value less costs of disposal and value
in use, to the asset’s carrying amount.
Any excess of the asset’s carrying
amount over its recoverable amount is
recognised immediately in profit or loss,
unless the asset is carried at a re-valued
amount.
Any impairment loss of a re-valued
asset is treated as a revaluation
decrease. Where it is not possible to
estimate the recoverable amount of an
individual asset, the Group estimates
the recoverable amount of the cash-
generating unit to which the asset
belongs. Impairment testing is performed
annually for goodwill and intangible
assets with indefinite lives.
(k) Fair Value of Assets and Liabilities
The Group measures some of its assets
and liabilities at fair value on either
a recurring or non- recurring basis,
depending on the requirements of the
applicable Accounting Standard.
Fair value is the price the Group would
receive to sell an asset or would have
to pay to transfer a liability in an orderly
(i.e. unforced) transaction between
independent, knowledgeable and willing
market participants at the measurement
date.
As fair value is a market-based measure,
the closest equivalent observable market
pricing information is used to determine
fair value. Adjustments to market values
may be made having regard to the
characteristics of the specific asset or
liability. The fair values of assets and
liabilities that are not traded in an active
market are determined using one or
more valuation techniques.
These valuation techniques maximise,
to the extent possible, the use of
observable market data.
To the extent possible, market
information is extracted from either
the principal market for the asset or
liability (i.e. the market with the greatest
volume and level of activity for the asset
or liability) or, in the absence of such a
market, the most advantageous market
available to the entity at the end of the
reporting period (i.e. the market that
maximises the receipts from the sale of
the asset or minimises the payments
made to transfer the liability, after taking
into account transaction costs and
transport costs).
For non-financial assets, the fair value
measurement also takes into account
a market participant’s ability to use the
asset in its highest and best use or to
sell it to another market participant that
would use the asset in its highest and
best use.
The fair value of liabilities and the entity’s
own equity instruments (excluding
those related to share- based payment
arrangements) may be valued, where
there is no observable market price in
relation to the transfer of such financial
instruments, by reference to observable
market information where such
instruments are held as assets.
Where this information is not available,
other valuation techniques are adopted
29
ZOONO GROUP LIMITED ANNUAL REPORT 2021
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30
and, where significant, are detailed
in the respective note to the financial
statements.
(l) Accounts payable
Trade payables and other accounts
payable are recognised when the
Group becomes obliged to make future
payments resulting from the purchase
of goods and services. Due to their
short-term nature they are measured
at amortised cost and not discounted.
These amounts are unsecured and
are usually paid within 30 days of
recognition.
(m) Provisions
Provisions are recognised when the
Group has a legal or constructive
obligation, as a result of past events, for
which it is probable that an outflow of
economic benefits will result and that
outflow can be reliably measured.
Provisions are measured using the best
estimate of the amounts required to
settle the obligation at the end of the
reporting period.
(n) Financial Instruments
Recognition and derecognition
Financial assets and financial liabilities
are recognised when the Group become
a party to the contractual provisions of
the financial instrument.
Financial assets are de-recognised when
the contractual rights to the cash flows
from the financial asset expire, or when
the financial asset and substantially all
the risk and rewards are transferred. A
financial liability is de-recognised when
it is extinguished, discharged, cancelled
or expires.
Classification and initial measurement
of financial assets
Except for those trade receivables that
do not contain a significant financing
component and are measured at the
transaction price in accordance with
AASB 15, all financial assets are initially
measured at fair value adjusted for
transaction costs.
Financial assets are classified into one of
the following categories:
• Amortised cost
• Fair value through profit or loss
(FCTPL), or
• Fair value through other
comprehensive income (FVOCI).
The classification is determined by both:
• The entity’s business model for
managing the financial asset, and
• The contractual cash flow
characteristics of the financial asset.
All revenue and expenses relating to
financial assets that are recognised in
profit or loss are presented within finance
costs, finance income or other financial
items, except for impairment of trade
receivables which is presented within
administration expenses.
for derivatives and financial liabilities
designated at FVTPL, which are carried
subsequently at fair value with gain or
losses recognised in profit or loss (other
than derivative financial instruments that
are designated and effective as hedging
instruments).
In the periods presented the Group does
not have any financial assets categorised
as FVTPL and FVOCI.
Financial assets at amortised cost
Financial assets are measured at
amortised cost if the asset meet
the following condition (and are not
designated as FVTPL):
• They are held within a business model
whose objective is to hold the
financial assets and collect its
contractual cash flows, and
• The contractual terms of the financial
assets give rise to cash flows that are
solely payment of principal and
interest on the principal amount
outstanding.
After initial recognition, these are
measured at amortised cost using the
effective interest method. Discounting is
omitted where the effect of discounting
is immaterial.
Impairment of financial assets
The Group makes use of a simplified
approach in accounting for trade and
other receivables as well as contract
assets and records the loss allowance
as lifetime expected credit losses. These
are the expected shortfalls in contractual
cash flows, considering the potential
for default at any point during the life of
the financial instrument. In calculating,
the Group uses its historical experience,
external indicators and forward-looking
information to calculate the expected
credit losses using a provision matrix.
The Group assess impairment of trade
receivables on a collective basis as they
possess shared credit risk characteristics
they have been grouped based on the
days past due.
Classification and measurement of
financial liabilities
The Group’s financial liabilities include
borrowings, trade and other payables
and contract liabilities.
Financial liabilities are initially measured
at fair value, and, where applicable,
adjusted for transaction costs unless the
Group designated a financial liability at
fair value through profit or loss.
Subsequently, financial liabilities are
measured at amortised cost using
the effective interest method except
All interest-related charges and, if
applicable, changes in an instrument’s
fair value that are reported in profit or
loss are included within finance costs or
finance income.
(o) Receivables
Trade receivable are initially recognised
at fair value and subsequently measured
at amortised cost using the effective
interest method, less any allowance for
impairment.
(p) Employee Benefits
Short-term employee benefits
Provision is made for the Group’s
obligation for short-term employee
benefits. Short-term employee benefits
are benefits (other than termination
benefits) that are expected to be settled
wholly before 12 months after the end of
the annual reporting period in which the
employees render the related service,
including wages, salaries and sick
leave. Short-term employee benefits are
measured at the (undiscounted) amounts
expected to be paid when the obligation
is settled.
The Group’s obligations for short-term
employee benefits such as wages,
salaries and sick leave are recognised as
part of current trade and other payables
in the statement of financial position.
(q) Share-based payments
The cost to the Company of share
options granted to directors and
executive officers is included at fair value
as part of the directors’ and executive
officers’ aggregate remuneration in the
financial year the options are granted.
The fair value of the share option are
calculated using the Black Scholes
option pricing model, which takes into
account the exercise price, the term of
the option, the vesting and performance
criteria, the impact of dilution, the non-
tradable nature of the option, the current
price and expected price volatility of the
underlying share, the expected dividend
yield and the risk-free interest rate for the
term of the option.
The fair value determined at the grant
date of the equity settled share-based
payment is expensed on a straight-line
basis over the vesting period.
(w) Comparative information
Comparative figures are, where
appropriate, reclassified to be
comparable with the figures presented
for the financial year.
31
(r) Revenue
Revenue is measured at the fair value
of the consideration received or
receivable after taking into account any
trade discounts and volume rebates
allowed. Any consideration deferred is
treated as the provision of finance and
is discounted at a rate of interest that
is generally accepted in the market for
similar arrangements. The difference
between the amount initially recognised
and the amount ultimately received is
interest revenue.
Revenue from the sale of goods is
recognised when the removal from the
warehouse occurs as this corresponds
to the transfer of significant risks and
rewards of ownership of the goods and
the cessation of all involvement by the
Group in those goods.
All revenue is stated net of the amount of
goods and services tax.
Other income
Interest revenue is recognised using
the effective interest method, which for
floating rate financial assets is the rate
inherent in the instrument.
Dividend revenue is recognised when
the right to receive a dividend has been
established.
Realised gains and losses on sale are
recognised as income or expense
respectively in the statement of profit or
loss and other comprehensive income
and are calculated as the difference
between consideration on sale and the
original cost.
(s) Goods and services tax (GST)
The Statement of Profit or Loss and
Other Comprehensive Income has been
prepared so that all components are
stated exclusive of GST, except where
the amount of GST incurred is not
recoverable from the tax office. All items
in the Statement of Financial Position
are stated exclusive of GST, with the
exception of receivables and payables,
which include GST.
(t) Earnings per share
i) Basic earnings per share:
Basic earnings per share is determined
by dividing the operating profit/(loss)
after income tax excluding any cost of
servicing equity other than ordinary
shares by the weighted average number
of ordinary shares outstanding during the
financial year.
ii) Diluted earnings per share
Diluted earnings per share adjusts the
figures used in determining earnings per
share by taking into account amounts
unpaid on ordinary shares and any
reduction in earnings per share that
will probably arise from the exercise of
options outstanding during the financial
year.
(u) Segment reporting
Segment revenues and expenses
are those directly attributable to the
segments and include any joint revenue
and expenses where a reasonable basis
of allocation exists. Segment assets
include all assets used by a segment and
consist principally of cash, receivables,
inventories, intangibles and property,
plant and equipment, net of allowances
and accumulated depreciation and
amortisation. Segment liabilities consist
principally of payables, employee
benefits, accrued expenses, provisions
and borrowings. The Group do not
allocate revenues, assets or liabilities to
individual segments.
(v) Leases
At inception of a contract, the Group
assesses if the contract contains or is
a lease. If there is a lease present, a
right-of-use asset and a corresponding
lease liability is recognised by the
Group where the Group is a lessee.
However, all contracts that are classified
as short-term leases (ie a lease with a
remaining lease term of 12 months or
less) and leases of low-value assets are
recognised as an operating expense on
a straight-line basis over the term of the
lease.
Initially, the lease liability is measured at
the present value of the lease payments
still to be paid at commencement date.
The lease payments are discounted at
the interest rate implicit in the lease. If
this rate cannot be readily determined,
the Group uses the incremental
borrowing rate.
The right-of-use assets comprise the
initial measurement of the corresponding
lease liability as mentioned above, any
lease payments made at or before the
commencement date, as well as any
initial direct costs. The subsequent
measurement of the right-of-use assets
is at cost less accumulated depreciation
and impairment losses.
Right-of-use assets are depreciated
over the lease term or useful life of
the underlying asset, whichever is
the shortest. Where a lease transfers
ownership of the underlying asset, or
the cost of the right-of-use asset reflects
that the Group anticipates to exercise
a purchase option, the specific asset is
depreciated over the useful life of the
underlying asset.
ZOONO GROUP LIMITED ANNUAL REPORT 2021
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5. REVENUE AND OTHER INCOME
T
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Revenue from operating activities
Operating activities
- Revenue from sale of goods
Total revenue from operating activities
Other income
- Dividends received
- New Zealand Trade & Enterprise
- Interest received
- Expenses recovery
Total other income
CONSOLIDATED
2021
NZ$
2020
NZ$
27,133,602
27,133,602
38,329,369
38,329,369
280
73,498
17,980
274,575
366,333
375
16,801
50,036
103,566
170,778
Revenue from Contracts
Revenue is recognised at a point in time when the service has been fulfilled and the
group has the right to invoice.
6. PROFIT FOR THE YEAR
Profit before income tax has been
determined after:
Depreciation
Amortisation
32
Expected credit loss allowance
Salary costs (including directors’ fees
and management fees)
Interest on borrowings
Net foreign exchange losses
CONSOLIDATED
2021
NZ$
2020
NZ$
336,440
23,389
654,636
165,059
32,378
16,747
3,611,796
2,738,965
75,221
352,398
52,559
188,548
148,500
10,673
21,079
AASB 16 related amounts recognised in the statement of profit or loss
Depreciation charge related to right of use assets
Interest expense on lease liabilities
Variable lease payment expense
258,202
70,560
29,122
7. INCOME TAX
The prima facie tax payable on profit/(loss) is reconciled to the income tax expense as
follows:
CONSOLIDATED
2021
NZ$
2020
NZ$
Prime facie tax payable on profit before income
tax at 28% (2020: 28%)
1,651,427
5,715,374
Add: tax effect of:
- Other assessable and non-allowable items
(217,631)
(60,307)
- Net of current year tax losses not recognised
and deductible items
- Deferred tax losses not recognised in accounts
20,105
17,317
-
-
- Utilisation of carry-forward losses
(691,568)
(1,449,723
- Effect of foreign exchange rates and different
tax rates
Income tax expense
485,067
(452,737)
1,264,717
3,752,607
Subject to the provisions of the Income Tax Assessment Act, if the Group derives
assessable income it will be able to utilise carry-forward losses. The Group has losses
available to be carried forward of NZ$1,542,541 to 30 June 2021.
The net deferred tax asset will only be obtained if:
(a) the Company derives future assessable income of a nature and of an amount
sufficient to enable the benefit from the deductions for the loss to be realised;
(b) the Company continues to comply with the conditions for deductibility imposed
by law; and
(c) no changes in tax legislation adversely affect the Company in realising the
benefit from the deduction of the loss.
Consequently, there is a balance of deferred tax asset that has not been recognised.
8. TRADE AND OTHER RECEIVABLES
Trade receivables
Provision for expected credit loss
Net GST/VAT receivable
Other receivables
CONSOLIDATED
2021
NZ$
5,733,906
(672,625)
5,061,281
214,245
20,430
2020
NZ$
8,874,855
(17,989)
8,856,866
276,461
96,092
5,295,956
9,229,419
The Group applies the AASB 9 simplified approach to measuring expected credit
losses, which permits the use of the lifetime expected loss provision for all trade
receivables.
The following table details the loss allowance as at 30 June 2021 and 30 June 2020.
As the Group’s historical credit loss experience does not show significantly different
loss patterns for different customer segments, the provision for loss allowance
based on past due status is not further distinguished between the Group’s different
customer bases.
PAST DUE BUT NOT IMPAIRED (DAYS OVERDUE)
< 30
NZ$
31–60
NZ$
61–90
NZ$
> 90
NZ$
0.42%
1.29%
3,824,222
866,246
0.9%
53,048
65.1%
990,390
(16,012)
(11,152)
(480)
(644,981)
3,808,210
855,094
52,568
345,409
2021
Expected Loss Rate
Trade and term receivables
Provision
Total
2020
Expected Loss Rate
0.1%
0.2%
0.3%
Trade and term receivables
3,498,186
2,919,806
2,194,557
Provision
Total
9. INVENTORIES
Finished goods at cost
(3,495)
(5,828)
(6,564)
3,494,691
2,913,978
2,187,993
CONSOLIDATED
2021
NZ$
2020
NZ$
12,863,790
12,863,790
13,202,029
13,202,029
0.77%
262,306
(2,102)
260,204
33
TOTAL
NZ$
5,733,906
(672,625)
5,061,281
8,874,855
(17,989)
8,856,866
ZOONO GROUP LIMITED ANNUAL REPORT 2021
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10. PLANT AND EQUIPMENT
T
R
O
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E
R
L
A
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N
A
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P
U
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Plant and equipment:
Plant and equipment at cost
Accumulated depreciation
Furniture and equipment:
Furniture and equipment at cost
Accumulated depreciation
Computer equipment:
Computer equipment at cost
Accumulated depreciation
Total Plant and Equipment
CONSOLIDATED
2021
NZ$
2020
NZ$
730,646
(72,212)
658,434
82,230
(34,500)
47,730
65,294
(34,394)
30,900
737,064
189,781
(19,495)
170,286
70,666
(24,086)
46,580
36,056
(23,567)
12,489
229,355
a. Movements in carrying amounts
Movement in the carrying amounts for each class of plant and equipment between
the beginning and the end of the current financial year:
34
Balance as at 1 July 2020
Additions
Disposals – written down value
Depreciation expense
Carrying amount at 30 June 2021
Balance as at 1 July 2019
Additions
Depreciation expense
Carrying amount at 30 June 2020
11. INTANGIBLE ASSETS
Trademarks and patents:
Trademarks and patents at cost
Accumulated amortisation
Website Development:
Website development at cost
Accumulated amortisation
Goodwill – at cost (Note 26)
Total Intangible Assets
PLANT AND
EQUIPMENT
FURNITURE AND
EQUIPMENT
COMPUTER
EQUIPMENT
TOTAL
NZ$
NZ$
NZ$
NZ$
170,286
548,066
(7,102)
(52,816)
658,434
46,580
11,564
-
(10,414)
47,730
12,489
26,317
-
(7,906)
30,900
PLANT AND
EQUIPMENT
FURNITURE AND
EQUIPMENT
COMPUTER
EQUIPMENT
229,355
585,947
(7,102)
(71,136)
737,064
TOTAL
NZ$
15,364
170,286
(15,364)
170,286
NZ$
32,320
23,035
(8,775)
46,580
NZ$
NZ$
2,751
14,097
(4,359)
12,489
50,435
207,418
(28,498)
229,355
CONSOLIDATED
2021
NZ$
2020
NZ$
150,220
(142,972)
7,248
78,450
(69,461)
8,989
147,820
(128,572)
19,248
78,450
(60,472)
17,978
5,677,544
-
5,693,781
37,226
b. Movements in carrying amounts
Movement in the carrying amounts for each class of intangible assets between the
beginning and the end of the current financial year:
Balance as at 1 July 2020
Additions
Acquisition through business combination
Amortisation expense
Carrying amount at 30 June 2021
12. LEASES
a. Right of use assets
Buildings
Equipment and motor vehicles
b. Lease liabilities
Current
Non-current
TRADEMARKS
AND PATENTS
WEBSITE
DEVELOPMENT
GOODWILL
TOTAL
NZ$
19,248
2,400
-
(14,400)
7,248
NZ$
17,978
-
-
(8,989)
8,989
NZ$
NZ$
-
-
5,677,544
-
5,677,544
37,226
2,400
5,677,544
(23,389)
5,693,781
CONSOLIDATED
2020
NZ$
2019
NZ$
2,015,266
-
2,015,266
342,527
1,732,334
2,074,861
1,456,213
44,042
1,500,255
201,156
1,359,022
1,560,178
c. Movements in carrying amounts
Movement in the carrying amounts for each class of right of use assets between the
beginning and the end of the current financial period:
35
Balance at 1 July 2020
Additions
Depreciation expense
Carrying amount at 30 June 2021
Balance at 1 July 2019
Additions
Depreciation expense
Carrying amount at 30 June 2020
13. OTHER ASSETS
Prepayments
BUILDINGS
NZ$
1,456,213
773,213
(214,160)
2,015,266
BUILDINGS
NZ$
527,272
1,055,805
(126,864)
1,456,213
EQUIPMENT
AND MOTOR
VEHICLES
NZ$
44,042
-
(44,042)
-
EQUIPMENT
AND MOTOR
VEHICLES
NZ$
65,678
-
(21,636)
44,042
TOTAL
NZ$
1,500,255
773,213
(258,202)
2,015,266
TOTAL
NZ$
592,950
1,055,805
(148,500)
1,500,255
CONSOLIDATED
2021
NZ$
195,875
195,875
2020
NZ$
176,027
176,027
ZOONO GROUP LIMITED ANNUAL REPORT 2021
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14. TRADE AND OTHER PAYABLES
T
R
O
P
E
R
L
A
U
N
N
A
D
E
T
M
L
P
U
O
R
G
O
N
O
O
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I
Trade creditors
Sundry creditors and accruals
Other payables
Income in advance
15. PROVISIONS
Current
Employee benefits
Non-current
Contingent consideration
CONSOLIDATED
2021
NZ$
2020
NZ$
1,217,887
5,430,248
259,090
445,226
291,242
2,213,445
819,741
850,183
1,319,723
8,419,895
CONSOLIDATED
2021
NZ$
92,886
92,886
5,559,467
5,559,467
2020
NZ$
-
-
-
-
Provision for employee benefits
Provision for employee benefits represents amounts accrued for annual leave.
The current portion for this provision includes the total amount accrued for annual
leave entitlements that have vested due to employees having completed the required
period of service. Based on past experience, the Group does not expect the full
amount of annual leave balances classified as current liabilities to be settled within
the next 12 months. However, these amounts must be classified as current liabilities
since the Group does not have an unconditional right to defer the settlement of these
amounts in the event employees wish to use their leave entitlement.
Provision for contingent consideration
This was in respect of anticipated consideration payable to Zoono USA LLC following
the acquisition of its business operations in July 2020. The consideration is payable
in cash and equity as a 15% royalty charge upon achievement of a cumulative sales
target amounting to no more than US$26,670,000 by the US business. The directors
have assessed the achievement of the sales target is likely to occur after 12 to 24
months and therefore presented the consideration payable as a non-current liability.
36
16. ISSUED CAPITAL
(a) Issued shares:
Beginning of the year
Issued during the year:
2021
NO. SHARES
2020
NO. SHARES
2021
NZ$
2020
NZ$
163,612,707
163,312,707
12,461,800
11,821,140
Shares issued as share-based payment
-
300,000
-
640,660
Exercise of options
End of the year
625,000
-
379,607
-
164,237,707
163,612,707
12,841,407
12,461,800
Holders of ordinary shares are entitled to participate in dividends when declared
and are entitled to one vote per share, either in person or by proxy, at shareholder
meetings. In the event of winding up of the Company, ordinary shareholders are
ranked after all other creditors and are entitled to any proceeds of liquidation in
proportion to the number of and amounts paid on the shares held.
Ordinary shares have no par value and the Company does not have a limited amount
of authorised capital.
(b) Uncalled capital:
No calls are outstanding at year end. All issued shares are fully paid.
(c) Capital management:
Management controls the capital of the Group in order to maintain a reasonable debt
to equity ratio, provide the shareholders with adequate returns and ensure that the
Group can fund its operations and continue as a going concern.
The Group currently has no debt funding available or external capital requirement.
The Group’s capital includes ordinary share capital share options and reserves. The
financial liabilities are supported by financial assets.
Management effectively manages the Group capital by assessing the Group’s
financial risks and adjusting its capital structure in response to changes in these risks
and in the market. These responses include the management of share issues. The
Group strategy remains unchanged from prior year.
17. RESERVES
CONSOLIDATED
2021
NZ$
2020
NZ$
(a) Foreign currency translation reserve
Balance at beginning of year
(463,166)
75,080
Exchange differences on translation of
foreign operations
Balance at end of year
106,442
(356,724)
(538,346)
(463,166)
Exchange differences arising on translation of the foreign controlled entity are
recognised in other comprehensive income and accumulated as a separate reserve
within equity. The cumulative amount is reclassified to profit or loss when the net
investment is disposed of.
(b) Equity settled share-based payment
In the prior year, the Group issued 200,000 fully paid ordinary shares in the Company
at a deemed price of A$1.77 per share for a total consideration of NZ$378,628 to
the UK/EU Regional Manager as part of his remuneration package and also issued
100,000 fully paid ordinary shares in the Company at a deemed price of A$2.45 per
share for a total consideration of NZ$262,032 to the UAE Regional Manager as part of
his remuneration package.
Employee share option scheme
Zoono’s Employee Securities Plan was adopted by the Company on 7 November
2019 as a long-term incentive scheme to recognise talent, retain and motivate
employees to strive for Group performance. All employees are entitled to participate
in the Share Securities Plan. In 2019, employees and consultants who have been with
the Group for more than one year were invited to receive options which vest in 1 year,
provided the recipient is still employed by the Company. The options were issued
for no consideration with an exercise price of A$0.25. They carry no entitlements
to voting rights or dividends of the Group. The number available to be granted is
determined by the Board, based on retention, performance measures including
growth in shareholder return, return on equity, cash earnings and Group earnings per
share growth.
Option granted to employees of the Company
On 16 December 2019, Zoono granted senior management and staff 2,000,000
options, vesting on 16 December 2020, exercisable at A$0.25 and expiring on 16
December 2023.
During the year, 625,000 options were exercised. The Group has 1,375,000 share
options on issue at year end (2020: 2,000,000).
18. REMUNERATION OF AUDITORS
Amounts received or due and receivable by the
auditors for:
- the review and the audit of the financial reports
for the consolidated group
CONSOLIDATED
2021
NZ$
2020
NZ$
73,000
73,000
55,000
55,000
37
ZOONO GROUP LIMITED ANNUAL REPORT 2021
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19.
ECONOMIC DEPENDENCY
T
R
O
P
E
R
L
A
U
N
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Zoono and its products are subject to various laws and regulations including but
not limited to accounting standards, tax laws, environmental laws, product content
requirement, labelling/packaging, regulations and customs regulations. Changes in
these laws and regulations (including interpretation and enforcement) could adversely
affect the Group’s financial performance. Laws and regulations are specific to each
geographic location. In this regard, there is a risk that a certain product may not be
able to be supplied in another jurisdiction because it fails to meet that jurisdictions
regulatory requirements (e.g. product registration requirements). Failure of the Group
to remain up to date with these various regulatory requirements, could adversely
affect the Group financial performance.
20.
CONTINGENT LIABILITIES
The directors are aware of claims against the Company as at the date to which these
financial statements are made up as follows:
• Qingdao Zoono Biotech Ltd (QZB) was formerly Zoono’s distributor in China. In
this dispute, QZB claims that Zoono Limited breached its contract with QZB, and
that Mr Paul Hyslop deceived QZB during negotiations. QZB seeks damages
totaling USD$390,000, interest on that sum and costs. Zoono Limited and Zoono
Group Limited have both brought a counterclaim against QZB and its director
Lingchen Qi – Zoono Limited’s counterclaim is against QZB for breaches
of contract, against Mr Qi for misrepresentation and breach of contract and
Zoono Group Limited’s counterclaim is against Mr Qi for breach of contract,
misrepresentation and inducing breach of contract.
The Group’s insurer have accepted the claim and our liability is limited to
a deductible of NZ$50,000 which has already been expensed in the financial
statements.
This proceeding is currently stayed, as QZB has failed to pay the first instalment of
security for costs and we have not heard from them for fifteen months. This
proceeding will remain stayed until QZB makes this payment, however we consider
there is a low risk that QZB will make this payment.
• Sky Scrapers General Trading LLC (Sky Scrapers) was formerly Zoono’s exclusive
distributor in UAE, Oman and Lebanon. In this dispute, Sky Scrapers claims that
Zoono breached its contract with Sky Scrapers and seeks either specific
performance of the contract or damages of at least USD$3,500,000. Zoono
Limited has brought a counterclaim against Sky Scrapers also for breach of
contract, and has also sought rectification of the contract. While Sky Scrapers has
brought a claim against Zoono Group Limited, Zoono Group Limited is not a party
to the contract, nor is there any apparent claim against Zoono Group Limited in
Sky Scrapers’ statement of claim. The Company has taken further independent
senior legal advice and the opinion is we have limited exposure under these
claims.
The parties have currently completed discovery and have started inspection. The
next steps will be to prepare evidence. A hearing has been set down for one week
from 23 May 2022.
21. RELATED PARTY TRANSACTIONS
Transactions between related parties are on normal commercial terms and conditions
unless otherwise stated. Complete details of the remuneration of directors and key
management personnel are set out in the Remuneration Report which forms part of
the accompanying Directors’ Report.
The totals of remuneration paid to key management personnel of the Company during
the year are as follows:
Short–term employee benefits
Other Benefits
Share based payments
CONSOLIDATED
2021
NZ$
996,241
16,431
127,496
2020
NZ$
893,615
6,102
155,560
1,140,168
1,055,277
Details of shares and options held by key management personnel are included in the
Remuneration Report set out in the accompanying directors’ report.
Key management personnel related entity transactions
Mr Paul Hyslop is the Managing Director/CEO of Zoono Group and provides
consulting services to the Group. Charges for services provided during the year
amounted to NZ$480,000 (2020: NZ$427,938).
Morgan Recruitment Limited provided recruitment services to the Company and was
paid NZ$9,900 (2020: NZ$52,970) for their services. The wife of Mr Paul Hyslop owns
Morgan Recruitment Limited.
Kota Management Limited provided legal services to the Company and was paid
NZ$6,900 (2020: NZ$ Nil) for their services. The daughter of Mr Hyslop owns Kota
Management Limited.
The Adams Agency Limited as an agent to the Company provided sales income
to the Company and was paid NZ$1,244 (2020: NZ$38,452) for their services. The
partner of Mr Paul Ravlich owns The Adams Agency Limited.
22. STATEMENT OF CASH FLOWS
(a) Reconciliation of cash:
Cash at bank
Cash on short term deposit
CONSOLIDATED
2021
NZ$
2020
NZ$
4,543,511
356,418
4,899,929
3,788,242
6,534,974
10,323,216
The effective interest rate on short-term bank deposits was 0.45% per annum
(2020: 0.8% per annum) and these deposits have an average maturity of 120 days.
(b) Reconciliation statement:
A reconciliation of “net cash used in operating activities” to “operating cash flows” is
as follows:
Profit after income tax
Non-cash items:
Amortisation
Depreciation
Share based payments
Provision for expected loss on trade receivables
Foreign exchange differences
Changes in assets and liabilities:
Trade and other receivables
Inventories
Prepayments
Current tax liabilities
Trade and other payables
Provisions
Net cash used in operating activities
CONSOLIDATED
2021
NZ$
2020
NZ$
4,633,236
16,659,442
23,389
336,440
299.991
654,636
470,278
32,378
169,892
1,006,699
17,989
3,687
3,278,827
(8,409,120)
985,567
(19,848)
(3,065,531)
(6,206,450)
92,886
1,483,421
(12,698,904)
(111,777)
3,752,607
7,668,303
-
8,091,196
The Company does not have any formal loan facilities in place at the date of these
financial statements.
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ZOONO GROUP LIMITED ANNUAL REPORT 2021
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23. EARNINGS PER SHARE
The following reflects the income and share data used in the calculations of basic and
diluted earnings per share (EPS):
Basic earnings per share
Diluted earnings per share
Weighted average number of ordinary shares
outstanding during the year used to calculate
basic EPS
Weighted average number of ordinary shares
outstanding during the year used to calculate
diluted EPS
2.89 cents
10.20 cents
2.87 cents
10.13 cents
163,673,499
163,344,947
165,048,499
164,421,450
Profit used to calculate basic and diluted EPS
4,732,470
16,659,422
There have been no transactions involving ordinary shares or potential ordinary shares
that would significantly change the number of ordinary shares or potential ordinary
shares outstanding between the reporting date and the date of completion of these
financial statements.
24. SEGMENT INFORMATION
Operating segments are not identified on the basis of internal reports about the
components of the Group that are regularly reviewed by the Chief Operating Decision
Makers in order to allocate resources to the segment and to assess its performance.
In presenting information on the basis of geographical segments, segment revenue is
based on the geographical location of distributors/customers. Segment assets and
liabilities are located in New Zealand and are allocated to individual geographical
segments by locations of distributors/customers on a reasonable basis. The Group’s
segment revenue is assigned to geographical locations and properly disclosed
according to segment asset requirements as follows;
Global revenues
Product
Hand sanitiser, textile applicator, mould remediation,
surface sanitiser
40
Geographical information
The Group’s revenue from external distributors/customers by geographical location.
Geographical Revenue
Global revenues
Total Group Revenue
CONSOLIDATED
2021
NZ$
2020
NZ$
27,133,602
38,329,369
27,133,602
38,329,369
i) Revenue by geographical region
Revenue attributable to external customers is disclosed below, based on the location
of the external customer.
Australasia, Asia, US, India
UK and Europe
Total Revenue
CONSOLIDATED
2021
NZ$
2020
NZ$
15,277,650
26,963,478
11,855,952
11,365,891
27,133,602
38,329,369
ii) Assets by geographical region
The location of segment assets by geographical location of the assets is disclosed
below.
Australasia, Asia, US, India
UK and Europe
Total Group Assets
CONSOLIDATED
2021
NZ$
2020
NZ$
19,665,753
24,000,939
12,035,908
10,696,588
31,701,661
34,697,527
25. FRANKING CREDITS
CONSOLIDATED
2021
NZ$
2020
NZ$
Dividend paid/provided for:
Final unfranked ordinary dividend declared and
paid on 21 September 2022 of 3.2 cents per share
The amount of the franking credits available for
subsequent reporting periods
5,095,400
-
88,384
88,384
26. CONTROLLED ENTITIES
Country of
Percentage Percentage
Incorporation Owned 2021 Owned 2020
Subsidiaries of Zoono Group Limited
Zoono Group Limited (NZ)
Zoono Limited
New Zealand
New Zealand
Zoono Holdings Limited (UK)
United Kingdom
Zoono EU Limited *
United Kingdom
Zoono (Shanghai) Biotech Co. Limited *
Zoono Holdings USA LLC *
* incorporated during the year
China
USA
100%
100%
100%
100%
100%
90%
100%
100%
100%
-
-
-
(a) Acquisition of business
In July 2020 pursuant to Memorandum of Understanding and Operating Agreement,
the group completed an acquisition of its US distributor’s operations (Zoono USA
LLC).
The total consideration transferred for this acquisition was US$4,453,000.
US$453,000 is payable in cash and US$4,000,000 is payable in the form of cash
and equity as a 15% royalty charge upon achievement of a cumulative sales target
amounting to no more than US$26,670,000 by the US business. There were no
identifiable assets and liabilities other than inventories amounting to US$453,000 (this
has been paid to Zoono USA LLC) and distribution rights reacquired from Zoono USA
LLC. In addition, as part of the acquisition, US distributor’s personnel were transferred
to Zoono Holdings USA LLC. Accordingly, the balance of the consideration payable
represents goodwill.
27. FINANCIAL RISK MANAGEMENT
Financial risk management policies
The Group’s financial instruments consist mainly of current accounts with banks,
accounts receivable and payable.
i. Treasury risk management
Management considers on a regular basis the financial risk exposure and evaluates
treasury management strategies in the context of the most recent economic
conditions and forecasts.
The overall risk management strategy seeks to meet the Group’s financial targets,
whilst minimising potential adverse effects on financial performance.
Management operates under policies approved by the board of directors which
approves and reviews risk management policies on a regular basis. These include
future cash flow requirements.
ii. Financial risk exposures and management
The main risks the Group is exposed to through its financial instruments are interest
rate risk, foreign currency risk, liquidity risk, credit risk and price risk.
(a) Foreign currency risk exposure
Most of the Group’s transactions are carried out in US Dollars ($USD), New Zealand
Dollars ($NZD), Australian Dollars ($AUD) and British Pound (GBP). Exposures to
currency exchange rates arise from the Group’s overseas sales and purchases, which
are primarily denominated in US Dollars ($USD), Australian Dollars ($AUD) and British
Pound (GBP). The Group also holds a bank account in $USD, $AUD and GBP and
RMB.
41
ZOONO GROUP LIMITED ANNUAL REPORT 2021
(b) Interest rate risk exposure
The Group is exposed to interest rate risk through cash and deposits held. The
Group continually monitors interest rates and financial markets for the Group’s cash
on deposit and regularly reviews future cash flow requirements. The following table
summarises the interest rate risk for the Group, together with the effective weighted
average interest rate for each class of financial assets and liabilities.
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Financial assets
Cash
Financial liabilities
Lease liabilities
2020
Financial assets
Cash
Financial liabilities
Lease liabilities
INTEREST
RATE
FIXED INTEREST MATURING IN NON-INTEREST BEARING
OVER 5
YEARS $
OVER 1 TO
5 YEARS $
OVER 1 TO
5 YEARS $
OVER 5
YEARS $
1 YEAR OR
LESS $
TOTAL
$
0.45%
356,418
-
-
4,543,511
4.5%
(342,527)
(1,450,202)
(282,132)
-
Net exposure to cash-flow interest rate risk
4.05%
13,891
(1,450,202)
(282,132)
4,543,511
Weighted average interest rate
0.45%
-
-
-
-
-
-
-
-
4,899,929
(2,074,861)
2,825,068
0.45%
INTEREST
RATE
FIXED INTEREST MATURING IN NON-INTEREST BEARING
OVER 5
YEARS $
OVER 1 TO
5 YEARS $
OVER 1 TO
5 YEARS $
OVER 5
YEARS $
1 YEAR OR
LESS $
TOTAL
$
Net exposure to cash-flow interest rate risk
Weighted average interest rate
0.8%
6,534,974
-
-
3,788,242
-
10,323,216
4.5%
3.7%
1.29%
201,157
898,855
460,167
-
6,333,817
(898,855)
(460,167)
3,788,242
-
-
-
-
-
-
-
1,560,179
8,763,037
1.29%
(c) Credit risk exposure
42
The maximum exposure to credit risk, excluding the value of any collateral or other
security, at reporting date to recognised financial assets is the carrying amount, net
of any provision for impaired receivables, as disclosed in the statement of financial
position and notes to the financial statements.
The Group does not have any material credit risk exposure to any single debtor or
group of debtors under financial instruments entered into by the Group.
Receivables due from major debtors are not normally secured by collateral, however
the credit worthiness of debtors is monitored.
(d) Liquidity risk
The Group manages liquidity risk by monitoring forecast cash flows to ensure that
adequate funding is maintained. The Group’s financial liabilities consist of trade and
other payables in the normal course of business and as such are normally due for
payment within 30 days of receipt of a valid tax invoice. The Group does not have any
liquidity risk associated with any borrowing.
(e) Interest rate risk
Interest rate risk on cash and short-term deposits is not considered to be a material
risk due to the short-term nature of these financial instruments.
28. PARENT INFORMATION
The following information has been extracted from the books and records of the
parent and has been prepared in accordance with Australian Accounting Standards.
Statement of Financial Position
ASSETS
Current assets
Non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
TOTAL LIABILITIES
EQUITY
Issued capital
Reserves
Accumulated losses
TOTAL EQUITY
Statement of Profit or Loss and
Other Comprehensive Income
Total profit for the year
Total comprehensive income for the year
PARENT ENTITY
2021
NZ$
2020
NZ$
572,359
220,442
25,514,850
29,316,565
26,087,209
29,537,007
210,533
210,533
137,345
137,345
12,841,407
12,461,800
453,022
366,026
12,582,247
16,571,836
25,876,676
29,399,662
1,350,908
1,350,908
776,511
776,511
29. EVENTS SUBSEQUENT TO REPORTING DATE
No other matters or circumstances have arisen since the end of the financial
year which significantly affected or may significantly affect the operations of the
consolidated group, the results of those operations, or the state of affairs of the
consolidated group in future financial years.
43
30. COMPANY DETAILS
The registered office of the parent Company is:
Level 12, 225 George Street Sydney NSW 2000 Australia.
The principal place of business of the Group is:
Unit 3 24 Bishop Dunn Place Flatbush,
Auckland 2013 New Zealand.
ZOONO GROUP LIMITED ANNUAL REPORT 2021
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Directors’
Declaration
The directors of Zoono Group Limited declare that:
The consolidated financial statements and associated notes for the financial year ended 30 June 2021 are in accordance with the
Corporations Act 2001 and:
a.
b.
2.
3.
comply with Accounting Standards and the Corporations Regulations 2001 and International Financial Reporting
Standards issued by the International Accounting Standards Board (IASB) as disclosed in Note 2; and
give a true and fair view of the financial position of the Company as at 30 June 2021 and the performance of the Group for
the financial year then ended.
The directors have received the declarations required by section 295A of the Corporations Act 2001 from the chief
executive officer and chief financial officer.
In the opinion of the directors there are reasonable grounds to believe that the Group will be able to pay its debts as and
when they become due and payable .
This declaration is made in accordance with a resolution of the directors.
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MR. PAUL HYSLOP
MANAGING DIRECTOR/CEO
26 August 2021
Auditor’s Independent
Report
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Additional Information
for Publicly Listed
Companies
The following information is current as at 10 August 2021.
DISTRIBUTION OF SHAREHOLDERS FULLY PAID
ORDINARY SHARES HOLDINGS RANGES
1-1,000
1,001-5,000
5,001-10,000
10,001-100,000
100,001- AND OVER
TOTALS
20 LARGEST SHAREHOLDERS
No. Name
NUMBER
HOLDER
NUMBERS
%
2,079
2,098
739
964
98
1,079,156
5,604,136
5,808,795
28,064,812
124,430,808
0.650
3.400
3.520
17.010
75.420
5,978
164,987,707
100.000
Number of Ordinary Shares Held % of Issued Capital
1 PAUL RUSSELL HYSLOP & MARGARET JANE MORGAN &
NPT MEG TRUSTEE LIMITED
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