Moa Group Limited Financial Statements for the six months ended 30 September 2017

Transcription

1 Moa Group Limited Financial Statements for the six months ended 30 September 2017

2 Moa Group Limited Index to the Financial Statements 30 September 2017 Page Unaudited Interim Statement of Comprehensive Income 2 Unaudited Interim Statement of Financial Position 3 Unaudited Interim Statement of Movement in Equity 4 Unaudited Interim Statement of Cash Flows 5 Notes to the Financial Statements 6-12

3 Moa Group Limited Interim Statement of Comprehensive Income For the 6 months ended 30 September 2017 RESTATED* NOTES $'000 $'000 $'000 Revenue 4,547 3,743 10,245 Cost of sales (3,235) (2,681) (7,192) Gross profit 1,311 1,017 3,053 Expenses: Distribution (445) (371) (978) Administration (958) (1,055) (2,011) Sales and marketing (1,387) (977) (2,381) Finance income and expense 2 (5) 7 Total expenses (2,789) (2,408) (5,363) Other gains / (losses) 5 (11) 13 (42) Loss before income tax (1,488) (1,333) (2,352) Income tax expense Loss for the period (1,488) (1,333) (2,352) Other comprehensive income and expenses Total comprehensive loss for the period (1,488) (1,333) (2,352) Losses per share for loss attributable to the ordinary equity holders of the Company during the period Basic losses (cents per share) (2.7) (2.6) (4.6) Diluted losses (cents per share) (2.7) (2.6) (4.6) Loss before income tax (1,488) (1,333) (2,352) Adjusted for: Depreciation & Amortisation Finance income and expense (2) 3 (7) Earnings before interest, tax, depreciation and amortisation (EBITDA) (1,288) (1,139) (1,959) * refer to note 11 The above Statement of Comprehensive Income should be read in conjunction with the accompanying notes. All profit/(loss) and total comprehensive profit/(loss) is attributable to the Parent Company shareholders and is from continuing operations. 2

4 Moa Group Limited Interim Statement of Financial Position As at 30 September 2017 ASSETS RESTATED* NOTES $'000 $'000 $'000 CURRENT ASSETS Cash and cash equivalents 1,526 3,133 2,700 Trade and other receivables 2,126 1,665 2,085 Derivative Financial Instruments Inventories 1,830 1,972 1,824 Total current assets 5,482 6,770 6,615 NON CURRENT ASSETS Trade and other receivables Plant and equipment 6 2,505 2,601 2,579 Intangibles Total non-current assets 3,176 3,117 3,108 Total assets 8,659 9,887 9,723 LIABILITIES CURRENT LIABILITIES Trade and other payables 2,087 2,486 2,093 Derivative financial instruments Total current liabilities 2,092 2,501 2,093 Total liabilities 2,092 2,501 2,093 Net assets 6,566 7,385 7,630 EQUITY Contributed equity 8 26,482 24,794 26,041 Reserves Accumulated losses (20,011) (17,505) (18,524) Total Equity 6,566 7,385 7,630 * refer to note 11 The above Statement of Financial Position should be read in conjunction with the accompanying notes. The Board of Directors authorised the statements presented on pages 2 to 12 for issue on 29 November For and on behalf of the Board Geoff Ross Director and CEO John Ashby Chairman of the Audit and Risk Committee 3

5 Interim Statement of Movements in Equity For the 6 months ended 30 September 2017 ATTRIBUTABLE TO EQUITY HOLDERS OF MOA GROUP LIMITED SHARE CAPITAL ACCUMMULATED LOSSES SHARE ENTITLEMENT RESERVE TOTAL EQUITY $'000 $'000 $'000 $'000 Opening balance as at 1 April ,145 (16,172) 67 6,040 Total comprehensive loss for the period (Restated*) - (1,333) - (1,333) Share based payments Issue of shares in lieu of fees Net proceeds from issue of new shares 2, ,605 Balance as at 30 September ,794 (17,505) 96 7,385 Total comprehensive loss for the period - (1,019) - (1,019) Share based payments Issue of shares in lieu of fees Net proceeds from issue of new shares 1, ,210 Employee share options exercised Balance as at 31 March ,041 (18,524) 113 7,630 Total comprehensive loss for the period - (1,488) - (1,488) Share based payments Issue of shares in lieu of fees Net proceeds from issue of new shares Employee share options exercised 82 - (33) 49 Balance as at 30 September ,482 (20,011) 95 6,566 *refer to note 11 The above Statement of Movements in Equity should be read in conjunction with the accompanying notes. 4

6 Moa Group Limited Interim Statements of Cash Flows For the 6 months ended 30 September 2017 RESTATED* NOTES $'000 $'000 $'000 CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers 5,662 4,997 12,896 Payments to suppliers and employees (7,057) (5,550) (14,928) Interest received Direct/indirect taxation received/(paid) (59) (75) (9) Net cash flow from operating activities 10 (1,451) (621) (2,034) CASH FLOWS FROM INVESTING ACTIVITIES Payments for plant and equipment (78) (415) (621) Payments for intangibles (12) - (24) Net cash flow from investing activities (90) (415) (645) CASH FLOWS FROM FINANCING ACTIVITIES Net proceeds from issue of shares ,605 3,815 Net cash flow from financing activities 368 2,605 3,815 Net Increase/(decrease) in cash and cash equivalents (1,174) 1,569 1,136 Cash and cash equivalents at the beginning of the period 2,700 1,564 1,564 Cash and cash equivalents at the end of the period 1,526 3,133 2,700 *refer note 11 The above Statement of Cash Flows should be read in conjunction with the accompanying notes. 5

7 1 General information Moa Group Limited ( the Parent or Company ) and its subsidiary (together the Group ) operate in the beverage sector, brewing and distributing super premium craft beer and cider. The Company has operations in New Zealand and sells predominantly to the New Zealand market, with a focus on growing exports to Asia and sales to other international markets. The Group s business is highly seasonal with the October to March period representing a disproportionate share of revenue and cash receipts. The address of its registered office is 70 Richmond Road, Grey Lynn, Auckland, These consolidated interim financial statements have been approved for issue by the Board of Directors on 29 November Basis of preparation of interim year report The Group consists of profit-oriented companies and the condensed consolidated interim financial information for the six months ended 30 September 2017 has been prepared in accordance with New Zealand Generally Accepted Accounting Practice (NZ GAAP). These financial statements comply with NZ IAS 34 Interim Financial Reporting and with International Accounting Standard 34 (IAS 34). The condensed consolidated interim financial information should be read in conjunction with the annual financial statements for the period ended 31 March 2017, which have been prepared in accordance with New Zealand equivalents to International Financial Reporting Standards (NZ IFRS) and International Financial Reporting Standards (IFRS). 3 Summary of significant accounting policies The accounting policies applied are consistent with those applied when preparing the annual financial statements for the year ended 31 March There are no new accounting standards, or amendments to existing standards that are effective for the year ending 31 March 2017 which are expected to have a material impact on the Group. 6

8 4 Segment information Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors. Although certain geographies do not currently meet the NZ IFRS 8 quantitative thresholds, management has concluded that these segments should be reported as they are closely monitored by the chief operating decision maker as potential growth segments and are expected to materially contribute to Group revenue in the future. The chief operating decision maker assesses the performance of the operating segments based on a measure of EBITDA (Earnings before interest, taxation, depreciation and amortisation). Interest income and costs are not allocated to segments as this type of activity is driven by the Group s head office function which manages the cash position of the Group. Head office costs are allocated to New Zealand as this segment represents the largest proportion of the Group s sales. The segment information provided to the chief operating decision maker for the reportable segments is as follows: 6 MONTHS ENDED 30 SEPTEMBER 2016 NEW ZEALAND AUSTRALIA EXPORT TOTAL $'000 $'000 $'000 $'000 Segment revenue 3, ,743 EBITDA (1,034) (56) (49) (1,139) Depreciation and amortisation (191) - - (191) Income tax expense Expenditure on fixed and intangible assets MONTHS ENDED 31 MARCH 2017 NEW ZEALAND AUSTRALIA EXPORT TOTAL $'000 $'000 $'000 $'000 Segment revenue 9, ,245 EBITDA (1,868) (215) 124 (1,959) Depreciation and amortisation (400) - - (400) Income tax expense Expenditure on fixed and intangible assets MONTHS ENDED 30 SEPTEMBER 2017 NEW ZEALAND AUSTRALIA EXPORT TOTAL $'000 $'000 $'000 $'000 Segment revenue 4, ,547 EBITDA (1,110) (140) (36) (1,288) Depreciation and amortisation (202) - - (202) Income tax expense Expenditure on fixed and intangible assets Revenues from external customers are derived from the sale of goods in the beverage sector. The total of non-current assets is $3,176,000 (31 March 2017: $3,108,000; 30 September 2016: $3,117,000), all of which are located in New Zealand. Segment assets and liabilities are not included within the reporting to the chief operating decision maker and hence have not been included within the segment information tables above. 7

9 5 Other gains/(losses) $'000 $'000 $'000 Foreign exchange gains/(losses) (11) 11 (14) Gains/(losses) on disposal of assets - - (28) Sundry income Total (11) 13 (42) 6 Plant and equipment $'000 $'000 $'000 Opening net book amount 2,579 2,346 2,345 Additions Disposals - - (50) Depreciation (161) (161) (337) Closing net book amount 2,505 2,601 2,579 7 Intangible assets $'000 $'000 $'000 Opening net book amount Additions 3-47 Amortisation (41) (29) (63) Closing net book amount The Group s intangible assets include the resource consent issued for the Group s brewery in Blenheim which are amortised over the life of the consent. 8

10 8 Contributed equity ORDINARY UNLISTED NON VOTING CONTRUBUTED SHARES $000s SHARES $000s CAPITAL $000 At 1 April ,264,134 22, , ,145 Non voting shares converted 726, (726,234) (106) - Shares issued to directors in lieu of fees 88, Placement shares 3,767,124 2, ,750 Issue costs (145) - - (145) At 30 September ,845,525 24, ,794 - Non voting shares converted - Shares issued to directors in lieu of fees 43, Rights issue 1,728,184 1, ,210 Staff options exercised 13, At 31 March ,630,087 26, ,041 - Voting shares converted (13,004) (6) 13, Staff options exercised 222, Shares issued to directors in lieu of fees 81, Placement shares 627, Issue costs - (10) - - (10) Treasury Stock issued , At 30 September ,549,111 26,476 98, ,482 The total number of authorised ordinary voting shares is 54,549,111. All issued shares are fully paid except the treasury shares where no value has been ascribed. The unlisted non-voting shares issued to directors are entitled to distributions and therefore have been included within contributed equity in the appropriate periods. Treasury stock is held for future transactions when a value will be ascribed. Unlisted non-voting shares The terms of appointment of directors stipulates they take 20% of their fees in shares at market prices instead of cash although under the terms of the Company s constitution directors can elect to receive all fees by way of Group shares. To comply with the Takeovers Code, The Business Bakery LP on behalf of Geoff Ross and Pioneer Capital on behalf of Craig Styris have elected to take unlisted non-voting ordinary shares in lieu of director purchases where necessary. At the time of the placement of 3,767,124 ordinary shares and 1,728,184 ordinary share by way of rights issue 726,234 unlisted non-voting shares were converted to ordinary shares. Craig Styris has purchased 13,004 ordinary shares on market that have been reclassified as unlisted non-voting shares. Unlisted non-voting ordinary shares have the same rights and terms and rank equally with ordinary shares except they do not carry voting rights. Shares issued to directors in lieu of fees In August 2015 the board approved the Salary Reinvestment Scheme which enabled employees and executive directors to receive ordinary shares in the Company instead of a proportion of their cash remuneration. Shares issued under the scheme are valued at a 20-day volume weighted average price. 9

11 Share placements and rights issues In September ,767,124 ordinary shares were issued to institutional investors. In order to provide the opportunity for existing Moa shareholders to invest at the same price a 1:30 rights issue offer was made and, from this rights offer, 1,728,184 ordinary shares were issued. In July ,986 ordinary shares were issued in a private placement. MOA Employee Share Option Plan In July 2015 the directors approved the MOA Employee Share Option Plan. Options allow eligible staff to subscribe for ordinary shares in the Company at an exercise price. Options are vested in equal tranches on the first to third anniversaries of the date of issuance while the eligible employees remain in full time employment with the Group. Once vested the options can be exercised at any time up to the second April following vesting. Employees can pay the exercise price in shares using the 20-day Volume Weighted Average Price of MOA shares up to the date of issuance. In September ,220,000 options were granted at an exercise price of $ In June ,000 options were granted at an exercise price of $ The options have been valued using the Black-Scholes pricing model. To date 235,651 staff options have been exercised to ordinary shares at a value of $81,000. This value includes the option value and the employee payments on exercise. OPTIONS ORDINARY SHARES ISSUED GRANTED LAPSED EXERCISED BALANCE $000S Shares $000s Pre 31 March Vesting October ,667 (40,000) (266,667) 100, , Vesting October ,667 (66,667) 340, Vesting October ,666 (66,667) 339, September 2015 grants 1,220,000 (173,334) (266,667) 779, , Vesting October ,000 40,000 - Vesting October ,000 40,000 - Vesting October ,000 40,000 - June 2017 grants 120, , Total Options 1,340,000 (173,334) (266,667) 899, , Related party transactions (a) Directors The Directors serving during the period were: Date of appointment Ashley Waugh Independent Director Independent Chairman 30 September January 2015 Geoff Ross Chief Executive Officer 27 August 2012 Craig Styris Non-Executive Director 27 August 2012 Allan Scott Non-Executive Director 27 August 2012 retired 27 September 2017 David Poole Executive Director 17 September 2015 John Ashby Independent Director 28 January 2015 Sheena Henderson Independent Director 1 October

12 (b) Board and key management remuneration Under an agreement between Moa Group Limited and The Business Bakery LP dated 10 October 2012, Chief Executive Officer Geoff Ross charged the Group for management fees in the period totalling $90,000 (6 months to September 2016: $120,000). Craig Styris directors fees are charged through Pioneer Capital Management Ltd and director fees for the period were payable to Ashley Waugh, John Ashby and Allan Scott. David Poole received directors fees in the period and management fees of $15,000 (6 months to September 2016: $30,000) through an associated company 1 st Seed Ltd. (c) Other transactions $'000 $'000 $'000 Director Fees Management Fees Senior employees' short term benefits Share based payments Moa Brewing Company leases its Jackson Road, Marlborough premises from Allan Scott Wines & Estates Ltd ( ASWEL ) under a Deed of Lease agreement dated 17 September ASWEL also provides various warehousing, maintenance, and production services to the company pursuant to a services agreement dated 17 September Costs charged under these arrangements totalled $18,100 for the period (30 September 201: $18,707). (d) Balances with related parties arising from sale & purchase of goods & services $'000 $'000 $'000 RECEIVABLES FROM RELATED PARTIES - Allan Scott Wines and Estates Ltd Senior executives Total PAYABLES TO RELATED PARTIES - Senior executives A Scott A Waugh Strategy in Action (J Ashby) st Seed Ltd (D Poole) The Business Bakery LP (G Ross) Pioneer Capital Partners (C Styris) Total

13 10 Reconciliation of loss after income tax to net cash flows from operating activities $'000 $'000 $'000 Loss for the period (1,488) (1,333) (2,352) Depreciation and amortisation Loss on disposal of fixed assets Foreign exchange (gains)/losses Shares in lieu of fees Share based payments (18) Movements in working capital: (Increase) / decrease in inventories (6) (157) 9 (Increase) / decrease in trade and other receivables (222) 14 (407) Increase in trade and other payables Net cash outflow from operating activities (1,451) (621) (2,034) 11 Restatement of interim results to 30 September 2016 In April 2016 the Group implemented a new computer system and subsequently identified adjustments to the financial statements reported at 30 September The adjustments are that cost of sales and loss was understated by $105,000. There is no restatement of the Financial Statements at 31 March In these Financial Statements the comparative figures for 30 September 2016 have been restated as follows: In the Statement of Comprehensive Income Cost of Sales is increased from $2,576,000 to $2,681,000 and the losses increased from $1,228,000 to $1,333,000. In the Statement of Financial Position Trade and other payables, Total liabilities and Accumulated losses are increased by $105,000. Net Assets and Total equity are reduced by $105,000. In the Statement of Movements in Equity the accumulated losses are increased by $105,000. In note 4 the New Zealand segment EBITDA loss is increased $105,000. In note 10 the Loss and the increase in Trade Payables are both increased by $105, Capital commitments There are no material capital commitments at 30 September Events occurring after balance date From 26 November 2017 ParrotDog Brewery in Wellington will take back distribution of their products in New Zealand. 12

14 Corporate Directory Directors ASHLEY WAUGH GEOFF ROSS DAVID POOLE CRAIG STYRIS JOHN ASHBY SHEENA HENDERSON (from 1 October 2017) Independent Chairman Chief Executive Officer Non Executive Director Non Executive Director Independent Director Independent Director Financial Calendar Interim results announced Interim report published End of financial year Annual results announced Annual report published November December 31 March May June Registered Office and address for service 70 Richmond Road, Grey Lynn, Auckland 1021 Phone Facsimile Auditor KPMG Banker Bank of New Zealand Solicitors Chapman Tripp Company Publications the Company informs investors of the Company s business and operations by issuing an Annual report and an Interim Report. Share register and shareholder enquiries Shareholders with enquiries about transactions or changes of address should contact the share register Link Market Services Limited Level 7, Zurich House, 21 Queen Street, Auckland, PO Box 91976, Auckland 1142 Phone Facsimile Other questions should be directed to the Company s Secretary at the registered address. Stock Exchange the company s shares trade on the NZX main board equity security market operated by NZX under the code MOA. 13