Noni B Limited ABN Appendix 4D Results for announcement to the market and Interim Financial Report Half-year ended 30 December 2018

Transcription

1 Noni B Limited ABN Appendix 4D Results for announcement to the market and Interim Financial Report Half-year ended 30 December 2018 Lodged with the ASX under Listing Rule 4.2A 1

2 Appendix 4D Noni B Limited Results for Announcement to the Market 30 December 2018 NONI B LIMITED ABN: Results for announcement to the market (Comparative information is for the half-year ended 31 December 2017) Financial Results $ 000 Revenue from ordinary activities Increased 139.7% to 462,132 Profit from ordinary activities after tax attributable to the owners of Noni B Limited Profit for the half-year attributable to the owners of Noni B Limited Decreased -19.2% to 9,531 Decreased -19.2% to 9,531 Dividends Amount per security (cents) Franked amount per security (cents) 2018 Final dividend (paid 12 October 2018) Interim dividend (declared 21 February 2019) On the 21 st February 2019, the Board of Directors declared an interim dividend of 9.0 cents per share with a record date of 12 March 2019 and payable to shareholders on 22 March No provision has been made in the Half-Year Financial Report in line with the requirements of AASB 137 Provisions, Contingent Liabilities and Contingent Assets. Net Tangible Assets (NTA) Dec 2018 Dec 2017 Net tangible asset backing per ordinary security (21.5) cents (10.6) cents Commentary on Results The commentary on the results for the half-year is contained in the interim financial report attached to this results announcement. Control gained over entities On 2 July 2018, Noni B Limited acquired the Millers, Autograph, Crossroads, Rivers and Katies brands from the Specialty Fashion Group through a purchase of assets (no legal entities were acquired). The acquired brands operate within the retail of women s apparel and accessories which will further complement the existing Noni B, Rockmans, W.Lane and beme brands. Loss of control over entities Not applicable Details of associates and joint venture entities Not applicable Foreign entities The results of all foreign entities have been compiled using the International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board. Audit qualification or review The financial statements were subject to a review by the auditors and the unqualified review report is attached as part of the interim report. Attachments Half-Year Financial Report Signed 21 February 2019 Scott Evans Managing Director Sydney 2

3 Noni B Limited ABN Interim Financial Report The interim financial report does not include all the notes of the type normally included in the annual financial report. Accordingly, this report is to be read in conjunction with the 2018 annual report and any public announcements made by Noni B Limited during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act

4 DIRECTORS' REPORT The directors present their report, together with the financial statements, on the Entity consisting of Noni B Limited and the entities it controlled at the end of, or during, the halfyear ended 30 December Directors The Directors of the Company at any time during or since the end of the half-year end and up to the date of this report are: Richard Facioni Scott Evans David Wilshire Sue Morphet Chairman and Non-Executive Director Managing Director and Chief Executive Officer Non-Executive Director Non-Executive Director Principal activities The principal activities of the Entity constituted by the Company and the entities it controlled during the half-year were the retailing of women s apparel and accessories. There were no significant changes in the nature of these activities during the half-year. Review of operations Noni B Limited (ASX:NBL) announces its financial results for the half-year ended 30 December 2018: Total Group revenue $464.4m, up 140.4% from 1H 2018 Underlying EBITDA $29.1m, up 31.4% from 1H 2018 Interim dividend 9.0 cents fully franked in line with prior year Cash-on-hand $64.7m, up 89.9% from 1H 2018 $45 million full year EBITDA guidance reaffirmed Results for the six months to ($ 000) ($ 000) % change Revenue and other income 464, , % EBITDA (underlying) 29,054 22, % Profit before tax 13,775 17, % Profit after tax (incl. transaction and restructuring costs) 9,531 11, % Earnings per share basic/diluted (cents) % 2019 Full Year Outlook Sales grew by 140.4% to $464.4m (1H 2018: $193.2m) following the acquisition of five brands from Specialty Fashion Group on 2 July Strong Christmas trading resulted in like-for-like sales growth of +1% for the month of December, resulting in the Group delivering -3.1% in likefor-like sales for the half year compared with the -5.0% announced to the end of October. The Group remains on track to deliver the previously announced additional cost synergies of $20m by 30 June 2019, over the achieved $30m (on an annual basis). Above this, we anticipate further efficiencies and margin improvements to add to the FY20 earnings, said Scott Evans, Managing Director and CEO of Noni B Group 4

5 DIRECTORS' REPORT 2019 Full Year Outlook (continued) The key focus and strategies for the Group include: Investment in our Online presence Restock the acquired brands to optimum levels Product purchase price synergies Whilst like-for-like sales growth has continued into the second half, we expect the market to remain challenging. However Noni B reaffirms its EBITDA continues in line with market consensus of approximately $45m for the full FY19 financial year, subject to trading leading up to the all-important Mother s Day trading period. This compares with the combined pro-forma EBITDA of $31.1m achieved by the Noni B Group and the five Specialty Fashion Group brands in the 2017 calendar year. Significant changes in the state of affairs On 2 July 2018, the Group acquired the Millers, Autograph, Crossroads, Rivers and Katies brands from the Specialty Fashion Group through a purchase of assets. The acquired brands operate within the retail of women s apparel and accessories thereby enhancing the product offering to the Group s core women s apparel market. The acquisition provides substantial synergies through combining supply chain and logistics, integrating online infrastructure and systems, optimising the store portfolio and leveraging the Group s expanded purchasing size. The half-year financial report includes the results of the acquired brands for the period from acquisition date. Rounding of amounts The Half-Year Financial Report is presented in Australian dollars and amounts have been rounded to the nearest thousand unless otherwise stated, in accordance with ASIC Corporations Legislative Instrument 2016/191. Auditor s independence declaration The auditor s independence declaration is set out on the following page. This Report is made in accordance with a Resolution of the Directors of the Company on 21 February Richard Facioni Chairman Scott Evans Managing Director and Chief Executive Officer Dated this 21 February

6 Tel: Fax: Level 11, 1 Margaret St Sydney NSW 2000 Australia DECLARATION OF INDEPENDENCE BY GILLIAN SHEA TO THE DIRECTORS OF NONI B LIMITED As lead auditor for the review of Gillian Shea for the half-year ended 30 December 2018, I declare that, to the best of my knowledge and belief, there have been: 1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the review; and 2. No contraventions of any applicable code of professional conduct in relation to the review. This declaration is in respect of Noni B Limited and the entities it controlled during the period. Gillian Shea Partner BDO East Coast Partnership Sydney, 21 February 2019 BDO East Coast Partnership ABN is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN , an Australian company limited by guarantee. BDO East Coast Partnership and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation, other than for the acts or omissions of financial services licensees. 6

7 NONI B LIMITED AND CONTROLLED ENTITIES CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME 30 December December 2017 Note $'000 $'000 Continuing Operations Revenue 3 462, ,835 Other income 3 2, Cost of goods sold (201,269) (68,661) Expenses (excluding finance costs) 4 (242,862) (106,854) Transaction and restructuring costs 12 (5,597) - Finance costs (876) (651) Profit before income tax 13,775 17,034 Income tax expense (4,244) (5,238) Profit attributed to members of the parent entity 9,531 11,796 Other comprehensive income, net of tax - - Total comprehensive income for the half-year attributed to members of the parent entity 9,531 11,796 Earnings per share Basic earnings per share (cents per share) Diluted earnings per share (cents per share) The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes 7

8 NONI B LIMITED AND CONTROLLED ENTITIES CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at 30 December December July 2018 ASSETS Note $'000 $'000 CURRENT ASSETS Cash and cash equivalents 64,683 58,697 Trade and other receivables 10,902 5,213 Inventories 144,547 45,482 Derivative financial instruments 1, Other current assets 2, TOTAL CURRENT ASSETS 224, ,811 NON-CURRENT ASSETS Trade and other receivables 550 1,210 Property, plant and equipment 5 50,112 32,234 Intangible assets 6 118,292 75,979 Deferred tax assets 38,969 16,622 Other non-current assets TOTAL NON-CURRENT ASSETS 208, ,164 TOTAL ASSETS 432, ,975 LIABILITIES CURRENT LIABILITIES Trade and other payables 7 200,583 59,701 Borrowings 8 1,982 3,479 Provisions 9 39,610 9,570 Derivative financial instruments Tax liabilities 4,971 4,467 Other current liabilities 8,990 6,179 TOTAL CURRENT LIABILITIES 256,293 83,404 NON-CURRENT LIABILITIES Borrowings 8 19,863 16,955 Provisions 9 2,772 1,126 Deferred tax liabilities 20,483 11,463 Other non-current liabilities 17,076 14,009 TOTAL NON-CURRENT LIABILITIES 60,194 43,553 TOTAL LIABILITIES 316, ,957 NET ASSETS 115, ,018 EQUITY Issued capital , ,651 Reserves 19,165 13,271 Accumulated losses (10,904) (10,904) TOTAL EQUITY 115, ,018 The above consolidated statement of financial position should be read in conjunction with the accompanying notes 8

9 NONI B LIMITED AND CONTROLLED ENTITIES CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Note Issued capital Accumulated losses Equity reserve Dividend profit reserve Total $ 000 $ 000 $ 000 $ 000 $ 000 Balance at 2 July ,340 (10,904) 1,739 3,253 62,428 Profit after income tax for the half-year - 11, ,796 Transfer to dividend profit reserve - (11,796) - 11,796 - Other comprehensive income for the half-year net of tax Total comprehensive income for the half-year ,796 11,796 Transactions with owners in their capacity as owners: Share based payment expense Shares issued during the period Dividends paid or provided for (3,201) (2,966) Balance at 31 December ,710 (10,904) 2,298 11,848 71,952 Balance at 1 July ,651 (10,904) 3,159 10, ,018 Profit after income tax for the half-year - 9, ,531 Transfer to dividend profit reserve - (9,531) - 9,531 - Other comprehensive income for the half-year net of tax Total comprehensive income for the half-year ,531 9,531 Transactions with owners in their capacity as owners: Share based payment expense Shares cancelled during the period (32) (32) Dividends paid or provided for (3,853) (3,804) Balance at 30 December ,619 (10,904) 3,375 15, ,880 The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes 9

10 NONI B LIMITED AND CONTROLLED ENTITIES CONSOLIDATED STATEMENT OF CASH FLOWS 30 December December 2017 Note $'000 $'000 Cash flows from operating activities Receipts from customers (inclusive of GST) 507, ,663 Payments to suppliers and employees (inclusive of GST) (445,296) (184,168) Transaction and restructuring costs paid 12 (5,597) - Interest received Interest and other finance costs paid (569) (576) Income taxes paid (8,532) (3,078) Net cash provided by operating activities 47,411 22,943 Cash flows from investing activities Payment for the purchase of business, net of cash acquired 12 (32,082) - Payment of contingent consideration on prior year acquisition - (3,000) Payments for property, plant and equipment (6,177) (9,087) Payments for software assets (596) (500) Proceeds from the sale of property, plant and equipment 26 8 Net cash used in investing activities (38,829) (12,579) Cash flows from financing activities Payment for buy-back of shares (32) (2) Proceeds from borrowings 9,000 - Repayment of borrowings (7,500) (1,500) Payment of borrowing costs (260) - Dividends paid (3,804) (2,966) Net cash used in financing activities (2,596) (4,468) Net increase in cash and cash equivalents 5,986 5,896 Cash and cash equivalents at the beginning of the half-year 58,697 28,167 Cash and cash equivalents at the end of the half-year 64,683 34,063 The above consolidated statement of cash flows should be read in conjunction with the accompanying notes 10

11 NOTES TO THE FINANCIAL STATEMENTS Note 1. Significant accounting policies Reporting Entity Noni B Limited is a for-profit company incorporated and domiciled in Australia. The consolidated interim financial statements, as at and for the six months ended 30 December 2018, comprise the company and its subsidiaries (together referred to as the Entity or Group ). The Entity is primarily involved in the retailing of women s apparel and accessories. Basis of preparation These financial statements for the interim half-year reporting period ended 30 December 2018 have been prepared in accordance with Australian Accounting Standard AASB 134 'Interim Financial Reporting' and the Corporations Act 2001, as appropriate for for-profit oriented entities. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS 34 'Interim Financial Reporting'. These interim financial statements do not include all the notes of the type normally included in annual financial statements. Accordingly, these financial statements are to be read in conjunction with the annual report for the year ended 1 July 2018 and any public announcements made by the Group during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act The Group has adopted AASB 15 Revenue from Contracts with Customers and AASB 9 Financial Instruments from 2 July Except for the changed significant accounting policies below, the same accounting policies and methods of computation have been followed in these half-year financial statements as compared with the most recent annual financial statements. With the adoption of these new and revised Accounting Standards, the following significant accounting policies were revised and applied retrospectively: Revenue recognition Revenue arising from sales of goods is recognised at the point in time when the customer has obtained control of the goods which is considered to be fulfilment of the performance obligation. Revenue is measured with consideration to any trade discounts and volume rebates. i. Retail sales revenue and jewellery commission revenue is recognised at the point of sale, which is where the customer has obtained control of the goods. Amounts disclosed as revenue are net of sales returns, trade discounts and commission paid. ii. Revenue from the sale of gift cards is recognised upon redemption of the gift card, or over the period when the card is no longer expected to be redeemed, based on analysis of historical non-redemption rates. iii. The Group operates a customer loyalty scheme which provides rebate vouchers to be issued to customers twice yearly, based on customer s purchases during the loyalty period. The vouchers have expiry dates six weeks after issue. The Group defers this revenue until such point at which the sale of goods is made. The deferred portion is recognised as revenue only after all the rebate obligations have been fulfilled. iv. Interest revenue is recognised when it is earned. Going concern As at 30 December 2018 the Group has a net current liability position of $31,995,000. Current liabilities include $8,990,000 in fitout contributions and lease incentives and $8,960,000 in employee benefit provisions which are not expected to be settled by cash in the next 12 months. As part of the business combination, management recognised a provision for onerous leases of $14,073,000 which is included in the current liabilities at the end of the reporting period which is not expected to be settled in cash. Notwithstanding the above, the Directors believe it is appropriate to prepare the financial report on a going concern basis given the circumstances below: On a consolidated basis, the Group stores are in a profit making position which is contributing to the positive operating cash flows. The directors expect that future net cash inflows from operating activities in conjunction with bank facilities made available will be sufficient to support the Groups operating activities. The Group has access to a $10,000,000 25,000,000 facility for working capital needs should they require it. The strategies that have been implemented by management around the improvement and alignment of policies and cost efficiencies within the new brands has had a positive impact which will continue to be driven in the second half of the financial year. Management remain confident that based on the synergies, margin gains and operational efficiencies the Group will remain compliant with all financial covenants. The Directors have concluded that there are reasonable grounds to believe that the Group will be able to pay its debts as and when they fall due. On this basis the financial report has been prepared on a going concern basis. Comparatives When required by Accounting Standards, comparative figures have been adjusted to conform with changes in presentation for the current financial year. Currency The interim financial statements are presented in Australian dollars. 11

12 NOTES TO THE FINANCIAL STATEMENTS Note 1. Significant accounting policies (continued) Registered office and principal place of business Ground Floor, 61 Dunning Avenue, Rosebery NSW 2018, Australia Note 2. Operating segments Management has determined the operating segments based on internal reports reviewed and used by the Chief Executive Officer ( CEO ) in assessing performance and in determining the allocation of resources. The Group is organised into one operating segment (fashion retail). Whilst the Group sells across different brands it was determined, based on similarities, to aggregate these into one segment. The similarities include marketing (both in the processes and the target customer), distribution as well as the procurement and production (standardised across the Group). The CEO assesses the performance of the operations based on a measure of underlying EBITDA (earnings before interest, tax, depreciation and amortisation adjusted for fair value revaluation of derivative financial instruments through profit or loss and restructuring costs). The accounting policies adopted for internal reporting to the CEO are consistent with those adopted in the financial statements. The information reported to the CEO is on at least a monthly basis, including weekly reporting on key metrics. A reconciliation of operating profit before income tax to underlying EBITDA is provided as follows: 30 December December 2017 $ 000 $ 000 Underlying EBITDA 29,054 22,108 Transaction and restructuring costs (5,597) - Net interest (399) (474) Other finance income 1, Depreciation, amortisation and impairment expenses (11,126) (5,205) Profit before income tax 13,775 17,034 Note 3. Revenue and other income 30 December December 2017 $ 000 $ 000 Revenue 462, ,835 Other income Rendering of services 2, Interest Profit on sale of non-current assets 26 9 Total other income 2, Total revenue and other income 464, ,200 Note 4. Expenses (excluding finance costs) 30 December December 2017 $ 000 $ 000 Marketing and selling expenses 123,230 52,811 Occupancy expenses 94,366 41,817 Administrative expenses 24,547 12,027 Other expenses Total expenses excluding finance costs 242, ,854 12

13 NOTES TO THE FINANCIAL STATEMENTS Note 5. Property, plant and equipment 30 December July 2018 $ 000 $ 000 a) Property, plant and equipment At cost 118,890 74,127 Accumulated depreciation (68,778) (41,893) Total property, plant and equipment 50,112 32,234 b) Movements in carrying amounts Plant and equipment $ 000 Balance at 2 July ,266 Additions 14,191 Disposals (154) Depreciation expense (10,069) Balance at 1 July ,234 Additions 6,174 Additions through business combinations (note 12) 22,640 Disposals (113) Depreciation expense (10,823) Balance at 30 December ,112 Note 6. Intangible assets Goodwill Brand names Software Total $ 000 $ 000 $ 000 $ 000 Opening net carrying value at 1 July ,625 36,300 1,054 75,979 Additions Additions through business combinations 21,003 20,900-41,903 Amortisation expense - - (186) (186) Closing net carrying value at 30 December ,628 57,200 1, ,292 Historical cost Cost 59,628 57,200 2, ,925 Accumulated amortisation - - (633) (633) Net carrying value 59,628 57,200 1, ,292 13

14 NOTES TO THE FINANCIAL STATEMENTS Note 7. Trade and other payables 30 December July 2018 $ 000 $ 000 Trade payable 115,846 40,536 Sundry payables 84,737 19,165 Total trade and other payables 200,583 59,701 Note 8. Borrowings 30 December July 2018 $ 000 $ 000 CURRENT Bank loans 1,982 3,479 Total current borrowings 1,982 3,479 NON-CURRENT Bank loans 19,863 16,955 Total non-current borrowings 19,863 16,955 Total borrowings 21,845 20,434 Borrowings are recognised at the fair value of the consideration received less directly attributable transaction costs at initial recognition and are subsequently measured at amortised cost. Fees paid on the establishment of loan facilities are amortised over the term of the facility. At 30 December 2018, the Group had outstanding borrowings (bank debt gross of capitalised transaction costs) of $22,250,000 (1 July 2018: $20,750,000 with $3,000,000 made available) Note 9. Provisions 30 December July 2018 $ 000 $ 000 CURRENT Employee benefits 23,523 9,160 Other provisions 16, Total current provisions 39,610 9,570 NON-CURRENT Employee benefits 2,772 1,126 Total non-current provisions 2,772 1,126 Other provisions Lease make Onerous Bonus Total good lease $ 000 $ 000 $ 000 $ 000 Opening net carrying amount at 1 July Additional provisions recognised 515 1,500-2,015 Additions through business combinations ,072 14,072 Amounts used (110) (300) - (410) Closing net carrying value at 30 December ,500 14,072 16,087 14

15 NOTES TO THE FINANCIAL STATEMENTS Note 10. Issued capital 30 December July 2018 Fully paid ordinary shares $ 000 $ 000 Balance at the beginning of the financial year 107,651 68,340 Issue of shares - 40,821 Less transaction costs in relation to capital raising (32) (1,510) Ordinary shares 107, ,651 Fully paid ordinary shares No. No. Balance at the beginning of the financial period 96,361,245 80,033,300 Issue of shares during the period (i) 825,000 16,603,945 Share buy-back (ii) (75,000) (276,000) Balance at the end of the financial period 97,111,245 96,361,245 (i) a total of 825,000 performance shares were issued during the period. (ii) 75,000 shares were issued to Senior Management however they were cancelled by the Company during the year. Note 11. Dividends paid Group Half-Year to 30 December 2018 Half-Year to 31 December 2017 Cents per share Total amount $ 000 Cents per share Total amount $ 000 Prior year final 4.0 3, ,201 All dividends are fully franked at a 30% tax rate. On 21 February 2019, the board of Directors declared an interim dividend in respect of the half-year ended 30 December 2018 of 9.0 cents (prior year: 9.0 cents) per share fully franked at a 30% tax rate. The amount will be paid on 22 March 2019 (2018: 29 March 2018). As the dividend was declared subsequent to 30 December 2018, no provision has been made as at 30 December

16 NOTES TO THE FINANCIAL STATEMENTS Note 12. Business Combinations On 2 July 2018, Noni B Limited acquired the Millers, Autograph, Crossroads, Rivers and Katies brands from the Specialty Fashion Group through purchase of assets. The acquired brands operate within the retail of women s apparel and accessories which will further complement the existing Noni B, Rockmans, W.Lane and beme brands. Details of the acquisition are as follows: Fair value $ 000 Consideration - Cash paid for purchase 31,000 - Working capital 8,003 - Net cash acquired (6,921) Total cash consideration / net cash outflow 32,082 Net identifiable assets acquired - Trade and other receivables 1,865 - Inventories 52,975 - Other current assets 1,157 - Property, plant and equipment 22,640 - Brand names 20,900 - Deferred tax assets 14,797 - Trade and other payables (65,920) - Deferred tax liabilities (6,270) - Provisions (31,065) Net identifiable assets acquired 11,079 Goodwill on acquisition 21, Transaction costs of $3,251,000 and restructuring costs of $2,346,000 were recognised in respect to this acquisition for the half year and are included in the consolidated statement of profit or loss and other comprehensive income Impact of acquisition on the results of the Group: As the acquisition occurred on 2 July 2018, the revenue and profit of the Group for the half-year ended 30 December 2018 reflects the financial reporting period of the acquired brands. AASB 3 Business Combinations requires disclosure of both the revenue and profit and loss of the acquired brands from the date of acquisition, and disclosure of revenue and profit and loss for the current reporting period as though the acquisition date for all business combinations had been as of the commencement of the financial period. As the acquisition occurred on 2 July 2018, the acquired brands contributed revenues of $281,800,000 to the Group for the financial reporting period. Management has however determined that disclosure of the profit and loss of the acquired brands from date of acquisition is impracticable after considering various factors including the pre-acquisition operating environment of the acquired brands and the effective merger of the acquired brands into the marketing, production, distribution and other activities of the Group. Provisional amounts Business combinations are initially accounted for on a provisional basis. The acquirer retrospectively adjusts the provisional amounts recognised and also recognises additional assets or liabilities during the measurement period, based on new information obtained about the facts and circumstances that existed at the acquisition-date. The measurement period ends on either the earlier of (i) 12 months from the date of the acquisition or (ii) when the acquirer receives all the information possible to determine fair value. 16

17 NOTES TO THE FINANCIAL STATEMENTS Note 13. Earnings per share Earnings per share for profit 30 December December 2017 $ 000 $ 000 Profit after income tax 9,531 11,796 Profit after income tax attributable to the owners of Noni B Limited 9,531 11,796 Weighted average number of ordinary shares used in calculating Number Number basic earnings per share 96,686 80,072 - diluted earnings per share 96,686 80,072 Basic earnings per share (cents per share) Diluted earnings per share (cents per share) Note 14. Contingent liabilities The Group is not aware of any contingent assets and liabilities at reporting date. Note 15. Events subsequent to reporting date There were no matters or circumstances specific to Noni B that have arisen since 30 December 2018 that have significantly affected or may significantly affect: The Group s operations in future financial years; The results of those operations in future financial years; or The Group s state of affairs in future financial years. 17

18 DIRECTORS' DECLARATION a) The financial statements and notes set out on pages 7 to 17 are in accordance with the Corporations Act 2001 and: i) comply with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001; and ii) give a true and fair view of the consolidated entity s financial position as at 30 December 2018 and of its performance for the half-year ended on that date. b) In the directors opinion, there are reasonable grounds to believe that the company 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 Board of Directors and is signed for and on behalf of the directors by: Scott Evans Managing Director and Chief Executive Officer Declaration made 21 February

19 Tel: Fax: Level 11, 1 Margaret St Sydney NSW 2000 Australia INDEPENDENT AUDITOR S REVIEW REPORT To the members of Noni B Limited Report on the Half-Year Financial Report Conclusion We have reviewed the half-year financial report of Noni B Limited (the Company) and its subsidiaries (the Group), which comprises the consolidated statement of financial position as at 30 December 2018, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the half-year then ended, and notes comprising a statement of accounting policies and other explanatory information, and the directors declaration. Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of the Group is not in accordance with the Corporations Act 2001 including: (i) Giving a true and fair view of the Group s financial position as at 30 December 2018 and of its financial performance for the half-year ended on that date; and (ii) Complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations Directors responsibility for the Half-Year Financial Report The directors of the company are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the half-year financial report that is free from material misstatement, whether due to fraud or error. Auditor s responsibility Our responsibility is to express a conclusion on the half-year financial report based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity, in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the half-year financial report is not in accordance with the Corporations Act 2001 including giving a true and fair view of the Group s financial position as at 30 December 2018 and its financial performance for the half-year ended on that date and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations As the auditor of the Group, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report. BDO East Coast Partnership ABN is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN , an Australian company limited by guarantee. BDO East Coast Partnership and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation, other than for the acts or omissions of financial services licensees. 19

20 A review of a half-year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. Independence In conducting our review, we have complied with the independence requirements of the Corporations Act We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of the Group, would be in the same terms if given to the directors as at the time of this auditor s review report. BDO East Coast Partnership Gillian Shea Partner Sydney, 21 February