HLG Annual Report for the year ended 1 August 2017

Hallenstein Glasson Holdings Ltd Annual Report 2017
B

“ Despite challenging retail conditions,
our FY17 performance has delivered a
strong result. By continuing to focus on
our customers, our fashionability and
digital; we are ensuring the business is
in good shape for the future.”
Mark Goddard
Group CEO

04
Financial
highlights
06
Chairman’s
report
10
Independent
auditor’s report
53
Directory and
calendar
16
Statement of
comprehensive
income
17
Statement of
financial position
18
Statement of
changes in equity
19
Statement of
cash flows
21
Notes to
the financial
statements
43
General
disclosures
47
Corporate
governance
50
Shareholder
information
Contents

Financial
Highlights

$’000
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FINANCIAL HIGHLIGHTS
Sales239,004223,510221,520207,984220,117
Profit after tax17,26913,67917,38614,27818,669
Net cash flows from operating activities29,19514,10131,17022,78821,818
FINANCIAL STATISTICS
Total equity58,47355,87763,41563,13766,935
Total assets85,14478,62886,29682,53985,308
Profit as % of average shareholders’ funds30.20%22.93%27.48%21.95%27.97%
Profit per ordinary share 28.95 22.93 29.15 23.94 31.30
Ratio current assets to current liabilities1.43:11.77:12.06:12.22:12.40:1
DIVIDEND (CENTS PER SHARE)
Interim paid April14.5013.5014.5012.0016.00
Final declared payable December17.0016.5016.5016.5017.50
31.5030.0031.0028.5033.50
Ordinary dividend cover0.92 0.76 0.94 0.84 0.93
Net tangible assets per share (cents) 97.12 92.85 105.26 103.61 112.22
% shareholders’ funds to total assets68.67%71.07%73.49%76.49%78.46%
Hallenstein Glasson Holdings Ltd Annual Report 2017
04

Hallenstein Glasson Holdings Ltd Annual Report 2017
05

T
he company advises that Group
sales for the 12 months to
1 August 2017 were $239.00 million,
an increase of 6.93% over the
corresponding period last year
($223.51 million). The audited net
profit after tax was $17.27 million, an increase of
26.24% over the corresponding period last year
($13.68 million).
The 2016/17 financial year has shown solid
growth over the prior year with the first half being
stronger than the second half. The improved
buying strategy, focus on cost control and a
favourable exchange rate led to the significant net
profit improvement. The trading environment has
remained tough in both New Zealand and Australia,
however the brands have adapted and responded
to these challenges to deliver the strong result.
Segment Results
Glassons New Zealand
Sales for the year were $89.50 million, an increase
of 7.16% on the prior year. Although the second
half was not as strong as the first, Glassons
continued to deliver margin growth. A key driver
in performance over the 12 months has been
improvement in fashionability and speed to
market. During the year a new store was opened
in Christchurch CBD and one underperforming
store in Glenfield was closed.
Following a review of the Glassons leadership
structure we have created the roles of CEO
New Zealand and CEO Australia, reporting directly
to the Group CEO.
April Pokaia has been appointed as CEO
of Glassons New Zealand, effective 1st December
2017. Prior to leaving Glassons in 2016, April had
13 years’ experience with the brand. James Glasson,
GM of Glassons Australia, was promoted to CEO
Glassons Australia from 6th October 2017.
Glassons Australia
Sales for the year were $50.06 million, an increase
of 21.57% on the prior year. The strategy to roll
out the new concept stores has been successful
along with the improved fashionability and speed
to market. This has resulted in continued growth
in Australia despite a particularly tough market for
retail. The store portfolio continues to be reviewed
and in the last year there has been three new
stores opened, three non profitable stores closed
and six stores refurbished to the new concept
format. Investment will continue in Australia as
we are encouraged by the results over the year.
There are currently plans to open two new
stores including the first Australian CBD store
in Melbourne.
Hallenstein Brothers
Sales for the year were $91.10 million (including
Australia), an increase of 1.89% on the prior year.
The increase was driven by a much improved
second half as the brand refocused and continued
to differentiate in the market. Hallenstein Brothers
continues to build on its established market
position in New Zealand and during the last year
has opened three stores in Australia. We will
continue to review the performance in Australia
and based on the success of these stores a
decision will be made on any further rollout.
Two new stores were opened in Newmarket
and Christchurch CBD and one underperforming
store was closed in The Hub in Christchurch.
Chairman’s
Report
Hallenstein Glasson Holdings Ltd Annual Report 2017
06

Storm
Sales for the year were $8.34 million, a decrease of
11.24% on the prior year. Sales struggled to maintain
momentum during the year due to tough trading
in a highly competitive segment of the market.
This has not been helped by major infrastructure
works around three key Auckland stores which has
had a material impact on trade. A review of the
brand was carried out towards the end of the year
and the decision made to close the Storm store
in Australia to focus on the brand in New Zealand,
this has seen trading improve. Christchurch CBD
store opened this year replacing the Christchurch
Container Store and a new store was opened
in Queenstown. There were also one-off costs
associated with the closure of Storm Australia.
E-Commerce
Online sales continue to grow at a significantly
greater rate than bricks and mortar stores, as a
result of the company’s commitment to build and
invest in digital. For the last financial year online
sales grew 44% which now represents over 9%
of Group turnover. We will continue to invest in
technology and resources in this area to ensure
that growth continues in this strategic area of
the business.
Dividend
The Directors have declared a final dividend
of 17 cents per share (fully imputed) to be paid
on 18th December 2017. Together with the
interim dividend of 14.5 cents per share paid on
13th April 2017 the dividend for the full year is
31.5 cents per share.
During the year capital expenditure was
$12.138 million, which was considerably higher than
historic levels of circa $6 million. This was primarily
due to a higher number of new and refurbished
stores in Australia, together with relocating all
chains back to the Christchurch CBD. We anticipate
capital expenditure will return to historic levels in
the new financial year. The balance sheet continues
to be strong, inventories well controlled and the
current trading patterns have allowed the company
to increase the dividend payment.
Future Outlook
The first seven weeks of the new financial year
has seen sales grow +5.48% on the prior year. The
improved buying strategy has allowed the gross
margin rate to also increase on last year. Customers
have reacted well to new seasons stock and web
sales continue to show increased rates of growth.
The company is continuing to invest in stores
with refurbishments planned for both Hallenstein
Brothers and Glassons in Queensgate shopping
centre in Wellington this season and two new stores
in Australia. The group is focused on ensuring our
performance going into Christmas trading.
An update on performance will be provided
at the Annual Meeting of Shareholders in
December 2017.
Warren Bell
Chairman
“ Our investment in digital has delivered
an encouraging 44% growth in online
sales. We will continue to invest in this
strategic area of our business.”
Hallenstein Glasson Holdings Ltd Annual Report 2017
07

“ We are obsessed with giving
our customers the most exciting
experience we can; delivered
through great service combined
with innovative store design.”
Mark Goddard
Group CEO
08

Hallenstein Glasson Holdings Ltd Annual Report 2017
09

Independent auditor’s report
to the shareholders of Hallenstein Glasson Holdings Limited
PricewaterhouseCoopers, 188 Quay Street, Private Bag 92162, Auckland 1142, New Zealand
T: +64 9 355 8000, F: +64 9 355 8001, pwc.co.nz
Independent auditor’s report
To the shareholders of Hallenstein Glasson Holdings Limited
The financial statements comprise:
the statement of financial position as at 1 August 2017;
the statement of comprehensive income for the year then ended;
the statement of changes in equity for the year then ended;
the statement of cash flows for the year then ended; and
the notes to the financial statements, which include a summary of significant accounting policies.
Our opinion
In our opinion, the financial statements of Hallenstein Glasson Holdings Limited (the Company),
including its subsidiaries (the Group), present fairly, in all material respects, the financial position of
the Group as at 1 August 2017, its financial performance and its cash flows for the year then ended in
accordance with New Zealand Equivalents to International Financial Reporting Standards (NZ IFRS)
and International Financial Reporting Standards (IFRS).
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand) (ISAs
NZ) and International Standards on Auditing (ISAs). Our responsibilities under those standards are
further described in theAuditor’s responsibilities for the audit of the financial statementssection of
our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
We are independent of the Group in accordance with Professional and Ethical Standard 1 (Revised)
Code of Ethics for Assurance Practitioners(PES 1) issued by the New Zealand Auditing and Assurance
Standards Board and the International Ethics Standards Board for Accountants’Code of Ethics for
Professional Accountants (IESBA Code), and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
Our firm carried out other services for the Group in the areas of IFRS training and Australian taxation
compliance services. The provision of these other services has not impaired our independence.
Hallenstein Glasson Holdings Ltd Annual Report 2017
10

Independent auditor’s report
to the shareholders of Hallenstein Glasson Holdings Limited
Our audit approach
Overview
An audit is designed to obtain reasonable assurance whether the financial
statements are free from material misstatement.
Overall group materiality: $1,203,500, which represents 5% of profit before
tax.
We applied this benchmark because, in our view, this is the metric against
which the performance of the Group is most commonly measured, and is a
generally accepted benchmark
We agreed with the Audit & Risk Committee that we would report to them
misstatements identified during our audit above $120,000 as well as
misstatements below that amount that, in our view, warranted reporting for
qualitative reasons.
We have identified one key audit matter being inventory valuation.
Materiality
The scope of our audit was influenced by our application of materiality.
Based on our professional judgement, we determined certain quantitative thresholds for materiality,
including the overall Group materiality for the financial statements as a whole as set out above. These,
together with qualitative considerations, helped us to determine the scope of our audit, the nature,
timing and extent of our audit procedures and to evaluate the effect of misstatements, both
individually and in aggregate on the financial statements as a whole.
Audit scope
We designed our audit by assessing the risks of material misstatement in the financial statements and
our application of materiality. As in all of our audits, we also addressed the risk of management
override of internal controls including among other matters, consideration of whether there was
evidence of bias that represented a risk of material misstatement due to fraud.
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an
opinion on the financial statements as a whole, taking into account the structure of the Group, the
accounting processes and controls, and the industry in which the Group operates.
Our Group audit scope focused on the major operating locations. In aggregate, the locations selected
as part of our audit scoping contributed 95% of the Group’s Revenue and 99% of the Group’s profit
before tax.
Audits of each major operating location are performed by PwC New Zealand at a materiality level
calculated by reference to a proportion of Group materiality appropriate to the relative scale of the
operations concerned. The remaining operations were not considered significant to the Group and
were subject to other procedures including analytical procedures.
Materiality
Audit scope
Key audit
matters
Hallenstein Glasson Holdings Ltd Annual Report 2017
11

Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial statements of the current year. The matter below was addressed in the
context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on the matter below.
Key audit matterHow our audit addressed the key audit
matter
Inventory Valuation
As at 1 August 2017, the Group held $20.6
million of inventories. Given the size of the
inventory balance relative to the total assets of
the Group and the estimates and judgements
described below, the valuation of inventory
required significant audit attention.
As disclosed in Note 3.2, inventories are held at
the lower of cost and net realisable value
determined using the weighted average cost
method. At year end, the valuation of inventory
is reviewed by management and the cost of
inventory is reduced where inventory is forecast
to be sold below cost.
The determination of whether inventory will be
realised for a value less than cost requires
management to exercise judgement and apply
assumptions. Management undertake the
following procedures for determining the level of
write down required:
Use inventory ageing reports together with
historical trends to estimate the likely
future saleability of slow moving and older
inventory lines;
For inventory aged greater than one year,
management apply a percentage based
write down to inventory. The percentages
are derived from historical levels of write
down;
Perform a line-by-line analysis of
remaining inventory to ensure it is stated at
the lower of cost and net realisable value
and a specific write down is recognised if
required.
Refer to Note 3.2 of the financial statements –
Inventories.
We have performed the following procedures
over the valuation of inventory:
For a sample of inventory items, re-
performed the weighted average cost
calculation and compared the weighted
average cost to the last purchase
invoices;
We tested that the ageing report used
by management correctly aged
inventory items by agreeing a sample of
aged inventory items to the last
recorded invoice;
On a sample basis we tested the net
realisable value of inventory lines to
recent selling prices;
We assessed the percentage write down
applied to older inventory with
reference to historic inventory write
downs and recoveries on slow moving
inventory; and
We re-performed the calculation of the
inventory write down.
We also made enquires of management,
including those outside of the finance function,
and considered the results of our testing above
to determine whether any specific write downs
were required.
From the procedures performed we have no
matters to report.
Independent auditor’s report
to the shareholders of Hallenstein Glasson Holdings Limited
Hallenstein Glasson Holdings Ltd Annual Report 2017
12

Information other than the financial statements and auditor’s report
The Directors are responsible for the Annual Report. Our opinion on the financial statements does not
cover the other information included in the Annual Report and we do not, and will not, express any
form of assurance conclusion on the other information. At the time of our audit, there was no other
information available to us.
In connection with our audit of the financial statements, if other information is included in the Annual
Report, our responsibility is to read the other information and, in doing so, consider whether the other
information is materially inconsistent with the financial statements or our knowledge obtained in the
audit, or otherwise appears to be materially misstated. If, based on the work we have performed on the
other information that we obtained prior to the date of our auditor’s report, we conclude that there is a
material misstatement of this other information, we are required to report that fact.
Responsibilities of the Directors for the financial statements
The Directors are responsible, on behalf of the Company, for the preparation and fair presentation of
the financial statements in accordance with NZ IFRS and IFRS, and for such internal control as the
Directors determine is necessary to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the Directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements, as a whole,
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report
that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with ISAs NZ and ISAs will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located at the
External Reporting Board’s website at:
https://xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/audit-report-1
This description forms part of our auditor’s report.
Who we report to
This report is made solely to the Company’s shareholders, as a body. Our audit work has been
undertaken so that we might state those matters which we are required to state to them in an auditor’s
report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Company and the Company’s shareholders, as a body, for our
audit work, for this report or for the opinions we have formed.
Independent auditor’s report
to the shareholders of Hallenstein Glasson Holdings Limited
Hallenstein Glasson Holdings Ltd Annual Report 2017
13

The engagement partner on the audit resulting in this independent auditor’s report is Julian Prior.
For and on behalf of:
Chartered AccountantsAuckland
28 September 2017
Independent auditor’s report
to the shareholders of Hallenstein Glasson Holdings Limited
Hallenstein Glasson Holdings Ltd Annual Report 2017
14

15
Hallenstein Glasson Holdings Ltd Annual Report 2017

Statement of comprehensive income
For the year ended 1 August 2017
$’000NOTE20172016
Sales revenue
2.1239,004223,510
Cost of Sales
2.1(98,350)(96,920)
Gross profit
140,654126,590
Other operating income
2.2954784
Selling expenses
(87,836)(80,921)
Distribution expenses
(7,327)(6,630)
Administration expenses
(22,614)(21,080)
Total expenses
(117,777)(108,631)
Operating profit
23,83118,743
Finance income
2.1239318
Profit before income tax
24,07019,061
Income tax
6.1(6,801)(5,382)
Net profit after tax attributable to the shareholders
of the Holding Company
2.117,26913,679
Other comprehensive income
- Items that will not be reclassified to profit or loss
Gains (net of tax) on revaluation of land and buildings
3,298–
Increase in share option reserve
129105
- Items that may be subsequently reclassified to profit or loss
Fair value (loss)/ gain (net of tax) in cash flow hedge reserve
764(3,480)
Total comprehensive income for the year attributable
to the shareholders of the Holding Company
21,46010,304
Earnings per share
Basic and diluted earnings per share
2.428.9522.93
The notes to the financial statements form an integral part of and are to be read in conjunction with these financial statements.
Hallenstein Glasson Holdings Ltd Annual Report 2017
16

The notes to the financial statements form an integral part of and are to be read in conjunction with these financial statements.
The financial statements are signed for and on behalf of the Board and were authorised for issue on 28 September 2017.
Graeme Popplewell Malcolm Ford
Director Director
28 September 2017 28 September 2017
Statement of financial position
As at 1 August 2017
$’000NOTE20172016
EQUITY
Contributed equity
5.127,27027,649
Asset revaluation reserve
15,91512,617
Cashflow hedge reserve
(1,654)(2,418)
Share option reserve
327203
Retained earnings
16,61517,826
Total equity
58,47355,877
Represented by
CURRENT ASSETS
Cash and cash equivalents
3.112,55214,191
Trade and other receivables
7791,660
Advances to employees
238346
Prepayments
3,8733,419
Inventories
3.220,60520,001
Total current assets
38,04739,617
NON-CURRENT ASSETS
Property, plant and equipment
4.244,86436,227
Intangible assets
539493
Deferred tax
6.21,6942,291
Total non-current assets
47,09739,011
Total assets
85,14478,628
CURRENT LIABILITIES
Trade payables
3.39,1697,921
Employee benefits
7.14,5003,929
Other payables
3.38,1876,208
Derivative financial instruments
7.52,2983,694
Taxation payable
2,517999
Total current liabilities
26,67122,751
Total liabilities
26,67122,751
Net assets
58,47355,877
Hallenstein Glasson Holdings Ltd Annual Report 2017
17

Statement of changes in equity
For the year ended 1 August 2017
$’000NOTE
SHARE
CAPITAL
TREASURY
STOCK
ASSET
REVALUATION
RESERVE
CASH
FLOW
HEDGE
RESERVE
SHARE
OPTION
RESERVE
RETAINED
EARNINGS
TOTAL
EQUITY
Balance at 1 August 2015
29,279(1,799)12,6171,06224222,01463,415
COMPREHENSIVE INCOME
Profit for year–––––13,67913,679
Revaluation net of tax–––––––
Cash flow hedges net of tax–––(3,480)––(3,480)
Increase in share option reserve––––105–105
Total comprehensive income
–––(3,480)10513,67910,304
TRANSACTIONS
WITH OWNERS
Purchase of treasury stock5.1, 5.2–(848)––––(848)
Sale of treasury stock5.1, 5.2–520––––520
Dividends 2.3, 5.1–149–––(17,895)(17,746)
Transfer to employee advances5.1–232––––232
Transfer of share option reserve

to retained earnings ––––(144)144–
(Gain)/loss on sale of
treasury stock transferred
to retained earnings5.1–116–––(116)–
Total transactions
with owners
–169––(144)(17,867)(17,842)
Balance at 1 August 2016
29,279(1,630)12,617(2,418)20317,82655,877
Comprehensive income
Profit for year–––––17,26917,269
Revaluation net of tax––3,298–––3,298
Cash flow hedges net of tax–––764––764
Increase in share option reserve––––129–129
Total comprehensive income
––3,29876412917,26921,460
TRANSACTIONS
WITH OWNERS
Purchase of treasury stock5.1, 5.2–(600)––––(600)
Sale of treasury stock5.1, 5.2–52––––52
Dividends 2.3, 5.1–175–––(18,491)(18,316)
Transfer to employee advances
5.1–––––––
Transfer of share option reserve
to retained earnings ––––(5)5–
(Gain)/loss on sale of
treasury stock transferred
to retained earnings
5.1–(6)–––6–
Total transactions
with owners
–(379)––(5)(18,480)(18,864)
Balance at 1 August 2017
29,279(2,009)15,915(1,654)32716,61558,473
The notes to the financial statements form an integral part of and are to be read in conjunction with these financial statements.
Hallenstein Glasson Holdings Ltd Annual Report 2017
18

Statement of cash flows
For the year ended 1 August 2017
The notes to the financial statements form an integral part of and are to be read in conjunction with these financial statements.
$’000NOTE20172016
CASH FLOWS FROM OPERATING ACTIVITIES
Cash was provided from:
Sales to customers
239,885222,568
Rent received
2.2781784
Interest income
2.1214285
Interest on debtors
2.12533
240,905223,670
Cash was applied to:
Payments to suppliers
159,875158,972
Payments to employees
2.245,86343,102
Taxation paid
5,9727,495
211,710209,569
Net cash flows from/(applied to) operating activities
29,19514,101
CASH FLOWS FROM INVESTING ACTIVITIES
Cash was provided from:
Proceeds from sale of property, plant and equipment
and intangible assets63133
Repayment of employee advances
105228
168361
Cash was applied to:
Purchase of property, plant and equipment and intangible assets
4.212,1385,917
12,1385,917
Net cash flows from/(applied to) investing activities
(11,970)(5,556)
CASH FLOWS FROM FINANCING ACTIVITIES
Cash was provided from:
Sale of treasury stock and dividends
5.1, 5.2227669
227669
Cash was applied to:
Dividend paid
2.318,49117,895
Purchase of treasury stock
5.1, 5.2600848
19,09118,743
Net cash flows from/(applied to) financing activities
(18,864)(18,074)
Net (decrease)/increase in funds held
(1,639)(9,530)
Cash and cash equivalents at the beginning of the year
14,19123,721
Cash and cash equivalents at the end of the year
3.112,55214,191
Hallenstein Glasson Holdings Ltd Annual Report 2017
19

Statement of cash flows (continued)
For the year ended 1 August 2017
$’000NOTE20172016
NET PROFIT AFTER TAXATION
17,26913,679
ADD/(DEDUCT) ITEMS CLASSIFIED AS INVESTING
OR FINANCING ACTIVITIES
Loss on sale of plant and equipment
2.235369
ADD/(DEDUCT) NON CASH ITEMS
Depreciation and amortisation
2.27,5657,512
Deferred taxation
6.2(688)(176)
Revaluation of financial instruments
(254)372
Share option expense
129105
ADD/(DEDUCT) MOVEMENTS IN WORKING CAPITAL ITEMS
Taxation payable
1,518(1,937)
Trade and other receivables and prepayments
427(3,762)
Trade and other payables and employee benefits
3,798(1,887)
Inventories
(604)(174)
NET CASH FLOWS FROM/(APPLIED TO) OPERATING ACTIVITIES
29,19514,101
The notes to the financial statements form an integral part of and are to be read in conjunction with these financial statements.
RECONCILIATION OF PROFIT AFTER TAXATION TO CASH FLOWS FROM OPERATING ACTIVITIES
Hallenstein Glasson Holdings Ltd Annual Report 2017
20

Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings is pleased to present a new structure designed to improve the clarity and usefulness
of these financial statements. The structure changes are regrouping the accounting policies and related notes, and
simplifying the disclosures. Accounting policies are disclosed in a shaded box.
1. BASIS OF PREPARATION
1.1 General information
Reporting entity
Hallenstein Glasson Holdings Limited (“Company” or “Parent”) together with its subsidiaries (the “Group”) is a
retailer of men’s and women’s clothing in New Zealand and Australia.
The Company is a limited liability company incorporated and domiciled in New Zealand. The address of its registered
office is Level 3, 235-237 Broadway Newmarket, Auckland.
Statutory base
Hallenstein Glasson Holdings Limited is a company registered under the Companies Act 1993 and is a FMC reporting
entity under Part 7 of the Financial Markets Conduct Act 2013. The Company is also listed on the New Zealand Stock
Exchange (NZX). The financial statements of the Group have been prepared in accordance with the requirements of
Part 7 of the Financial Markets Conduct Act 2013 and the NZX Main Board Listing Rules.
The financial statements were approved for issue by the Board of Directors on 28 September 2017.
1.2 General accounting policies
Statement of compliance
These financial statements for the year ended 1 August 2017 have been prepared in accordance with Generally
Accepted Accounting Practice (GAAP). They comply with New Zealand equivalents to International Financial
Reporting standards (NZ IFRS), other New Zealand accounting standards and authoritative notices that are
applicable to entities that apply NZ IFRS. The financial statements comply with International Financial Reporting
Standards (IFRS).
Basis of preparation of financial statements
The principal accounting policies adopted in the preparation of the financial statements are set out below.
These policies have been consistently applied to all the periods presented, unless otherwise stated.
The reporting currency used in the preparation of these financial statements is New Zealand dollars,
rounded where necessary to the nearest thousand dollars.
Entities reporting
The financial statements are the Consolidated Financial Statements of the Group comprising Hallenstein Glasson
Holdings Limited and subsidiaries, together they are referred to in these financial statements as ‘the Group’.
The Parent and its subsidiaries are designated as for-profit entities for financial reporting purposes.
Principles of consolidation
Subsidiaries
Subsidiaries are all entities over which the Group has control. The Group controls an entity when the Group
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 over the entity. Subsidiaries are fully consolidated from the date on which
control is transferred to the Group. They are deconsolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains and losses on transactions between Group companies
are eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency
with the policies adopted by the Group.
Hallenstein Glasson Holdings Ltd Annual Report 2017
21

Notes to the financial statements
For the year ended 1 August 2017
1. BASIS OF PREPARATION (CONTINUED)
Investments in subsidiaries
PRINCIPAL SUBSIDIARIESINTEREST HELD BY PARENT
AND GROUP
PRINCIPAL ACTIVITIES
20172016
Hallenstein Bros Limited100%100%Retail of menswear in New Zealand
Hallenstein Brothers Australia Limited100%n/aRetail of menswear in Australia
Glassons Limited100%100%Retail of womenswear in New Zealand
Glassons Australia Limited100%100%Retail of womenswear in Australia
Retail 161 Limited100%100%Retail of womenswear in New Zealand
Retail 161 Australia Limited100%100%Retail of womenswear in Australia
Hallenstein Properties Limited100%100%Property ownership in New Zealand
Historical cost convention
These financial statements have been prepared under the historical cost convention, as modified by the revaluation
of land and buildings and financial assets and liabilities (including derivative instruments) measured at fair value.
Critical accounting estimates, judgements and assumptions
The preparation of financial statements in conformity with NZ IFRS requires the use of certain critical
accounting estimates. It also requires management to exercise its judgement in the process of applying the
Group’s accounting policies.
Property, plant and equipment: The Group has assessed whether the carrying value of its property, plant and
equipment have suffered any impairment since they were acquired. The recoverable amounts of cash generating
units (at a subsidiary level) are determined based on value in use calculations. These calculations require the use
of estimates and projections of future operating performance.
Inventory provision: The Group assess the inventory provision using management judgement which considers
a range of factors including the review of historical data, the age of inventory and current selling price trends
to determine the appropriateness of the provision.
Revaluation of Land and Buildings: The fair value of the Group’s land and buildings is determined by the Board
following an independent valuation undertaken at least every three years. The basis of the valuation is assessed
within a range indicated by two valuation approaches: discounted cash flow analysis and an income capitalisation
approach. The key assumptions are disclosed in note 4.2.
Foreign currency translation
Functional and presentation currency
Items included in the financial statements of each of the Group’s operations are measured using the currency
of the primary economic environment in which it operates (‘the functional currency’). The financial statements
are presented in New Zealand dollars, which is the Company’s functional and the Group’s presentation currency.
Transactions and balances
The results and financial position of all the Group entities that have a functional currency different from the
presentation currency are translated into the presentation currency as follows:
(a) assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that
balance sheet; and
(b) income and expenses for each statement of comprehensive income are translated at average exchange rates.
All resulting exchange differences are recognised in the statement of comprehensive income.
Hallenstein Glasson Holdings Ltd Annual Report 2017
22

2. PERFORMANCE
2.1 Segment information
Operating segments are reported in a manner consistent with the internal reporting provided to the Board of Directors.
The Board of Directors is the chief operating decision maker and is responsible for allocating resources and assessing
performance of the operating segments and they delegate that authority through the Chief Executive Officer.
The Board of Directors considers the business from both a product and geographic perspective as follows:
• Hallenstein Bros Limited (New Zealand) and Hallenstein Brothers Australia Limited (Australia)
• Glassons Limited (New Zealand)
• Glassons Australia Limited (Australia)
• Retail 161 Limited (New Zealand) and Retail 161 Australia Ltd (Australia) (Storm)
• Hallenstein Properties Limited (New Zealand) (Property)
The reportable segments derive their revenues primarily from the retail sale of clothing. The revenues from external
parties reported to the Board of Directors are measured in a manner consistent with that in the statement of
comprehensive income. There are no significant revenues derived from a single external customer.
Segment results
FOR THE YEAR ENDED 1 AUGUST 2017
$’000
GLASSONS
NEW ZEALAND
GLASSONS
AUSTRALIA
HALLENSTEINSSTORMPROPERTYPARENT
TOTAL
GROUP
INCOME STATEMENT
Sales revenue from
external customers89,50050,06291,1018,341– –239,004
Cost of sales(38,166)(18,791)(38,145)(3,248)––(98,350)
Finance income1304845–16239
Depreciation and
software amortisation2,4442,0312,511298281–7,565
Profit/(loss)
before income tax11,2971,93410,434(434)839–24,070
Income tax(3,186)(548)(2,953)121(235)–(6,801)
Net profit/(loss)
after income tax8,1111,3867,481(313)604–17,269
BALANCE SHEET
Current assets
13,1034,32517,7081,0781,876(43)38,047
Non current assets10,5937,96510,0551,12817,356–47,097
Current liabilities8,6086,13111,0944873193226,671
Purchase of property, plant
and equipment and intangibles2,2283,9785,247577108–12,138
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
23

FOR THE YEAR ENDED 1 AUGUST
2016
$’000
GLASSONS
NEW ZEALAND
GLASSONS
AUSTRALIA
HALLENSTEINSSTORMPROPERTYPARENT
TOTAL
GROUP
INCOME STATEMENT
Sales revenue from
external customers83,51841,18189,4149,397––223,510
Cost of sales(38,082)(17,317)(38,258)(3,263)––(96,920)
Finance income125117611–5318
Depreciation and
software amortisation2,7511,9422,287252280–7,512
Profit/(loss)
before income tax7,666(2,646)11,8881,208945–19,061
Income tax(2,155)737(3,359)(340)(265)–(5,382)
Net profit/(loss)
after income tax5,511(1,909)8,529868680–13,679
BALANCE SHEET
Current assets17,8852,66613,6741,9493,13730639,617
Non current assets10,0645,9057,43097514,637–39,011
Current liabilities7,4823,71610,2041,0562603222,751
Purchase of property, plant
and equipment and intangibles2,0332,1791,43326211–5,918
2.2 Income and expenses
Revenue comprises the fair value of the consideration received or receivable for the sale of goods and services,
excluding Goods and Services Tax, rebates and discounts and after eliminating sales within the Group.
Revenue is recognised as follows:
Sales of goods – retail
Sales of goods are recognised when a Group entity has delivered a product to the customer. Retail sales are usually
in cash or by credit card. The recorded revenue is the gross amount of sale (excluding GST), including credit card
fees payable for the transaction. Such fees are included in selling expenses.
Interest income
Interest income is recognised using the effective interest method.
Rental income
Rental income from operating leases (net of any incentives) is recognised on a straight line basis over the lease term.
2. PERFORMANCE (CONTINUED)
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
24

2. PERFORMANCE (CONTINUED)
Income and expenses
Profit before income tax includes the following specific income and expenses:
$’00020172016
INCOME
Rental income
781784
Insurance proceeds
173–
EXPENSES
Occupancy costs
27,41525,422
Amounts paid to auditors - statutory audit
126123
Other services from auditors*
2010
Directors' fees
383382
Wages, salaries and other short term benefits
45,86343,102
Total depreciation
7,2947,220
Amortisation of software
271292
Total depreciation and amortisation
7,5657,512
Loss on sale of property, plant and equipment
35369
* Amount paid in respect of IFRS training and tax and compliance work performed in Australia, whilst prior year relates to tax work
performed in Australia.
2.3 Dividends
Provision is made for the amount of any dividend declared on or before the balance date but not distributed at
balance date.
Dividends
2017
CENTS PER
SHARE
2016
CENTS PER
SHARE
2017
$000’S
2016
$000’S
Interim dividend for the year ended 1 August 2017
14.508,649
Final dividend for the year ended 1 August 2016
16.509,842
Interim dividend for the year ended 1 August 2016
13.508,053
Final dividend for the year ended 1 August 2015
16.509,842
Total
31.0030.0018,49117,895
All dividends paid were fully imputed. Supplementary dividends of $100,210 (2016: $105,207) were paid to shareholders
not resident in New Zealand for tax purposes for which the Group received a foreign investor tax credit.
2.4 Earnings per share
Basic and diluted earnings per share is calculated by dividing the profit attributable to equity holders of the Company
by the weighted average number of ordinary shares outstanding during the period, adjusted for bonus elements in
ordinary shares issued during the period.
Basic
Basic earnings per share is calculated by dividing the profit after tax of the Group by the weighted average number
of ordinary shares outstanding during the year.
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
25

2. PERFORMANCE (CONTINUED)
Diluted
Diluted earnings per share is calculated by adjusting profit after tax and the weighted average number of ordinary
shares outstanding to assume conversion of all dilutive potential ordinary shares. There are no options convertible
into shares as at 1 August 2017 (2016: Nil).
Earnings per share
$’00020172016
Profit after tax
17,26913,679
Weighted average number of ordinary shares outstanding
59,64959,649
Basic and diluted earnings per share (cents per share)
28.9522.93
3. WORKING CAPITAL
3.1 Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with financial institutions, 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, and bank overdrafts.
Statements of cash flows
The following are the definitions of the terms used in the statement of cash flows:
(I) Cash comprises cash and cash equivalents.
(II) Investing activities are those activities relating to the acquisition, holding and disposal of property, plant and
equipment, investments and employee advances.
(III) Financing activities are those activities which result in changes in the size and composition of the capital structure
of the Group. This includes both equity and debt not falling within the definition of cash. Dividends paid are
included in financing activities.
(IV) Operating activities include all transactions and other events that are not investing or financing activities.
Cash and cash equivalents
$’00020172016
Cash at bank
3,7671,978
Short term bank deposits
8,72212,152
Cash on hand
6361
12,55214,191
The carrying amount of cash and cash equivalents equals the fair value.
3.2 Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined using the weighted average
method and includes expenditure incurred in acquiring the inventories and bringing them to their existing location and
condition. Net realisable value is the estimated selling price in the ordinary course of business, less applicable variable
selling expenses, excluding borrowing costs.
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
26

3. WORKING CAPITAL (CONTINUED)
Inventories

$’00020172016
Finished goods
21,14120,746
Inventory adjustments
(536)(745)
Net inventories
20,60520,001
Inventory adjustments are provided at year end for stock obsolescence within cost of sales in the statement of
comprehensive income.
The cost of inventories recognised as an expense and included in cost of sales amounted to $95,035,127
(2016: $96,668,046).
3.3 Trade and other payables
Trade and other payables amounts represent liabilities for goods and services provided to the Group prior to the end
of a financial period, which are unpaid. Trade and other payables are recognised initially at fair value and subsequently
accounted for at amortised cost using the effective interest method.
Trade and other payables
$’00020172016
Trade payables
9,1697,921
Other payables
8,1876,208
Total trade and other payables
17,35614,129
4. LONG TERM ASSETS
4.1 Leases
The Group is the lessee
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as
operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged
to the profit and loss in the statement of comprehensive income on a straight line basis over the period of the lease.
The Group is the lessor
Assets leased to third parties under operating leases are included in property, plant and equipment in the statement
of financial position. They are depreciated over their expected useful lives on a basis consistent with similar owned
property, plant and equipment. Rental income (net of any incentives given to lessees) is recognised on a straight line
basis over the lease term.
Lease commitments:
The Group leases various retail outlets under non-cancellable operating lease agreements. Leases reflect normal
commercial arrangements with varying terms, escalation clauses and renewal rights.
Lease commitments
$’00020172016
At balance date the future aggregate minimum lease commitments was as follows:
Due within one year
22,50818,341
One to two years
19,34714,985
Two to five years
34,40923,884
Later than five years
7,2545,002
Total operating lease commitments
83,51862,212
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
27

4. LONG TERM ASSETS (CONTINUED)
Lease receivables:
The Group owns rental property which it leases under non-cancellable operating lease agreements to external
parties. Leases reflect normal commercial arrangements with varying terms, escalation clauses and renewal rights.
The future minimum rental payments receivable under these leases is as follows:
Lease receivables
$’00020172016
Due within one year
862722
One to two years
763716
Two to five years
1,8491,848
Later than five years
128725
Total lease receivables
3,6024,011
4.2 Property, plant and equipment
Recognition and measurement
Land and buildings were valued on 1 August 2017 by Telfer Young (Hawkes Bay) Ltd, Fordbaker Valuation Limited
and Colliers International who are independent registered valuers and associates of The New Zealand Institute of
Valuers. The valuers have recent experience in the location and category of the item being valued. The fair values
of the assets represent the estimated price for which a property could be sold on the date of valuation in an
orderly transaction between market participants.
The adopted valuation has been assessed within a range indicated by two valuation approaches:
Income capitalisation approach and discounted cash flow analysis.
The following table summarises the valuation approach and key assumptions used by the valuers to arrive
at fair value.
VALUATION APPROACHDESCRIPTION OF THE VALUATION APPROACH
Income capitalisation approachA valuation methodology which determines fair value by capitalising
a property’s sustainable net income at an appropriate, market derived
capitalisation rate (yield). Unobservable inputs within the income

capitalisation approach include:
a) Net Market Rent which is the annual amount for which a tenancy
within property is expected to achieve under a new arm’s length
leasing transaction after deducting a fair share of property
operating expenses.
b) Capitalisation Rate (yield) which is the rate of return, determined
through analysis of comparable, market related sales transactions
which is applied to a property’s sustainable net income to
derive value.
Discounted cash flow analysis
With the discounted cash flow approach (DCF) a cash flow budget is
established for the property over a ten-year time horizon. Within the
cash flow an allowance is made for rental growth as well as deducting
costs associated with property ownership A terminal value is also

estimated and the cash flows are discounted at a market rate to arrive
at a net present value. Unobservable inputs within the discounted
cash flow approach include:
a) The discount rate which is the rate determined through analysis of
comparable market related sales transactions which is applied to a
property’s future net cash flows to convert those cash flows into a
present value.
b) The terminal capitalisation rate which is the rate which is applied
to a property’s sustainable net income at the end of an assumed
holding period to derive an estimated market value.
c) Rental growth rate which is the annual growth rate applied to
market rent over an assumed holding period.
d) Expenses growth which is the annual amount applied to property
operating expenses over an assumed holding period.
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
28

4. LONG TERM ASSETS (CONTINUED)
The revaluation surplus net of applicable deferred income taxes was credited to other comprehensive income
and is shown in the asset revaluation reserve in shareholders’ equity.
At each reporting date, where a valuation report is not obtained the most recent valuation reports are reviewed
by the management team. The review focuses on checking material movements and ensuring all additions and
disposals are captured and that there have been no material changes to the underlying assumptions on which
the valuations are based.
Land and building measurements are categorised as Level 3 in the fair value hierarchy. During the year there
were no transfers between levels of the fair value hierarchy.
Both the income capitalisation approach and discounted cash flow analysis contain unobservable inputs in
determining fair value. These are summarised in the table below:
DESCRIPTION
FAIR VALUE AT
1 AUGUST 2017
$000’S
VALUATION
TECHNIQUE
UNOBSERVABLE
INPUTS
RANGE OF
UNOBSERVABLE
INPUTS
RELATIONSHIP OF
UNOBSERVABLE INPUTS

TO FAIR VALUE
Land and
buildings –
retail
12,490Income
capitalisation
approach and

discounted
cash flow
analysis
Net market rent$408 – $1,164 per m
2
The higher the rent per
square metre the higher
the fair value
Capitalisation rate
(yield)
6.53% – 7.35%The lower the yield the
higher the fair value
Discount rate7.37% – 9.00%The higher the discount
rate the lower the fair value
Terminal
capitalisation rate
7.00% – 7.75%The higher the terminal
rate the lower the fair value
Rental growth rate1.50% – 2.52%The higher the rental
growth rate the higher the
fair value
Expenses growth$3,129 – $5,000The higher the expenses
the lower the fair value
Land and
buildings –
warehouse
11,500Income
capitalisation
approach and
discounted
cash flow
analysis
Net market rent$96 – $122 per m
2
The higher the rent per
square metre the higher
the fair value
Capitalisation rate
(yield)
5.375% – 7.05%The higher the yield the
lower the fair value
Discount rate7.25% – 8.30%The higher the discount
rate the lower the fair value
Terminal
capitalisation rate
5.75% – 8.50%The higher the terminal
rate the lower the fair value
Rental growth rate2.50% – 3.00%The higher the Rental
growth rate the higher the
fair value
Expenses growth$3,687 – $10,546The higher the expenses
the lower the fair value
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.
Increases in the carrying amount arising on revaluation of land and buildings are credited to other comprehensive
income and shown as an asset revaluation reserve in shareholders’ equity. Decreases that offset previous increases
of the same asset are charged in other comprehensive income and debited against the asset revaluation reserve
directly in equity; all other decreases are charged to the statement of comprehensive income. Each year on
revaluation, the difference between depreciation based on the revalued carrying amount of the asset charged to
the statement of comprehensive income, and depreciation based on the asset’s original cost is transferred from
‘other reserves’ to ‘retained earnings’.
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
29

4. LONG TERM ASSETS (CONTINUED)
Depreciation
Land is not depreciated. Depreciation on other assets is calculated using the straight line method to allocate their
cost, net of their residual values, over their estimated useful lives, as follows:
Buildings 67 years
Plant and equipment 2 – 5 years
Furniture, fittings and office equipment 5 – 10 years
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate at each balance date.
Impairment
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. Assets that are subject to amortisation are reviewed
for impairment whenever events or changes in circumstances indicate that the carrying amount may not be
recoverable, for example a planned store closure, withdrawal from a business segment, or assessment of loss
making stores. Assets are grouped at the lowest levels for which there are separately identifiable cash flows
(cash generating units).
Disposal
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These are
included in the statement of comprehensive income.
YEAR ENDED 1 AUGUST 2017
$’000
LAND AT
FAIR VALUE
BUILDINGS
AT FAIR
VALUE
FIXTURES &
FITTINGS
PLANT &
EQUIPMENTTOTAL
Opening NBV
8,45512,54911,9543,26936,227
Additions
– 849,0482,68311,815
Disposals
– – (85)(86)(171)
Depreciation
– (290)(5,317)(1,687)(7,294)
Revaluations
7553,532 – – 4,287
Closing NBV
9,21015,87515,6004,17944,864
Cost/Valuation
9,21015,87554,61417,96297,661
Accumulated depreciation
– – (39,014)(13,783)(52,797)
Closing NBV
9,21015,87515,6004,17944,864
YEAR ENDED 1 AUGUST 2016
$’000
LAND AT
FAIR VALUE
BUILDINGS
AT FAIR
VALUE
FIXTURES &
FITTINGS
PLANT &
EQUIPMENTTOTAL
Opening NBV
8,45512,84313,2143,67938,191
Additions
– – 4,3921,3675,759
Disposals
– – (311)(193)(503)
Deprecation
– (290)(5,277)(1,652)(7,220)
Transfers
– (4)(64)68 –
Closing NBV
8,45512,54911,9543,26936,227
Cost/Valuation
8,45512,83946,86412,47380,631
Accumulated depreciation
– (290)(34,910)(9,204)(44,404)
Closing NBV
8,45512,54911,9543,26936,227
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
30

4. LONG TERM ASSETS (CONTINUED)
If land and buildings were stated on an historical cost basis, the amounts would be as follows:
$’00020172016
Land
7,8097,809
Buildings
10,65010,566
Cost
18,45918,375
Accumulated depreciation
(2,243)(2,030)
Net book amount
16,21616,345
5. EQUITY
5.1 Share capital
Ordinary shares are classified as capital, net of treasury stock.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction,
net of tax, from the proceeds.
Treasury stock
Shares purchased on market under the executive share scheme are treated as treasury stock on acquisition at cost.
On vesting to the employee, treasury stock shares are credited to equity and an employee loan is recorded initially
at fair value and subsequently at amortised cost.
Reserves
The asset revaluation reserve records revaluations of property, net of tax. The cash flow hedge reserve records the
fair value of derivative financial instruments, net of tax that meet the hedge accounting criteria. The share option
reserve is used to record the accumulated value of unvested share rights arising from the executive share scheme
which have been recognised in the statement of comprehensive income.
Contributed equity
2017
SHARES
2016
SHARES
2017
$000’S
2016
$000’S
Balance at beginning of year
59,107,42559,113,75927,64927,480
Purchase of treasury stock
(174,715)(289,857)(600)(848)
Sale of treasury stock
14,591192,42352520
Dividends
––175149
Transfer to employee advances
–91,100–232
(Gain)/loss on sale of treasury stock
transferred to retained earnings
––(6)116
Balance at end of year
58,947,30159,107,42527,27027,649
Representing:
Share capital
59,649,06159,649,06129,27929,279
Treasury stock (net of dividends)
(701,760)(541,636)(2,009)(1,630)
Total
58,947,30159,107,42527,27027,649
All shares are fully paid and rank equally.
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
31

5. EQUITY (CONTINUED)
5.2 Executive share scheme
Equity settled share-based compensation benefits are provided to employees in accordance with the Group’s
executive share scheme. The fair value of share rights granted under the scheme is recognised as an employee
benefit expense with a corresponding increase in equity. The fair value is measured at grant date and recognised
over the period during which the employees become unconditionally entitled to the share rights.
The fair value at grant date of the share rights are determined using a Black Scholes Pricing model that takes into
account the exercise price, the term of the share right, the vesting and performance criteria, the non-tradable nature
of the share right, the share price at grant date and expected price volatility of the underlying share, the expected
dividend yield and the risk-free interest rate for the term of the share right.
At each balance date, the Group revises its estimate of the number of share rights that are expected to become
exercisable. The employee benefit expense recognised each period takes into account the most recent estimate.
Upon the vesting of share rights, the balance of the share option reserve relating to the share rights is transferred
to retained earnings.
The Company operates an employee share scheme for certain senior executives to purchase ordinary shares in
the Company.
The Company provides the employees with limited recourse loans on an interest free basis to assist employees’
participation.
The loans are applied to purchase shares on market and the shares are treated as treasury stock.
The loan amount is the total market value of the shares plus any commission applicable on the date of purchase.
Any dividends payable on the shares are applied towards the repayment of the advance.
Shares purchased under the scheme are held by two directors as custodians and vest three years from the date of
purchase. In the event the employee leaves the Company during the vesting period, the loan is repaid by selling the
shares on market. Any gain or loss arising from the sale of shares is included in equity. Refer to note 5.1 for further
detail on treasury stock.
In accordance with NZ IFRS 2 this scheme is an equity-settled scheme.
The model inputs for shares issued during the year ended 1 August 2017 included a share issue price ranging
between $3.01–$3.53, (2016: $2.72–$3.41) an expected price volatility of 30% (2016: 30%), a risk free interest
rate of 1.9% (2016: 2.25%–2.5%) and an estimated 3 year vesting period.
Executive share scheme
YEAR ENDED 1 AUGUST 2017YEAR ENDED 1 AUGUST 2016
NUMBER
OF SHARES
PURCHASE/
(SALE) PRICE
NUMBER
OF SHARES
PURCHASE/
(SALE) PRICE
Balance at beginning of financial year
541,636535,302
Purchased on market during the year
174,7153.43289,8572.93
Forfeited during the year
(14,591) (3.55)(192,423) (2.70)
Exercised during the year
–(91,100)
Balance at end of financial year
701,760541,636
Percentage of total shares hold by scheme
1.18%0.91%
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
32

6. TAXATION
6.1 Income tax expense
The income tax expense or revenue for the period is the tax payable or receivable on the current period’s taxable
income based on the notional income tax rate for each jurisdiction, adjusted by changes in deferred tax assets
and liabilities attributable to temporary differences between the tax bases of assets and liabilities and their
carrying amounts in the financial statements and unused tax losses.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply
when the assets are recovered or liabilities are settled, based on those tax rates which are enacted or substantively
enacted for each jurisdiction. The relevant tax rates are applied to the cumulative amounts of deductible and
taxable temporary differences to measure the deferred tax asset or liability. An exception is made for certain
temporary differences arising from the initial recognition of an asset or a liability. No deferred tax asset or liability
is recognised in relation to these temporary differences if they arose in a transaction, other than a business
combination, that at the time of the transaction did not affect either accounting profit or taxable profit or loss.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable
that future taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount
and tax bases of investments in operations where the Company is able to control the timing of the reversal of
the temporary differences and it is probable that the differences will not reverse in the foreseeable future.
Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised
directly in equity.
Goods and Services Tax (GST)
The statement of comprehensive income and statement of cash flows have been prepared so that all components
are stated exclusive of GST. All items in the statement of financial position are stated net of GST, with the exception
of receivables and payables, which include GST invoiced.
Income tax expense
$’00020172016
Income tax expense
The tax expense comprises:
Current tax expense 7,4895,558
Deferred tax expense (note 6.2)
– Future tax benefit current year(688)(176)
Total income tax expense
6,8015,382
Reconciliation of income tax expense to tax rate applicable to profits
Profit before income tax expense24,07019,061
Tax at 28% (2016: 28%)6,7405,337
Tax effect of:
– Expenses not deductible for tax6145
Total income tax expense
6,8015,382
The effective tax rate for the year was 28% (2016: 28%).
The Group has no tax losses (2016: Nil) and no unrecognised temporary differences (2016: Nil).
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
33

6. TAXATION (CONTINUED)
The tax (charge)/credit relating to components of other comprehensive income are as follows:
20172016
BEFORE
TAX
TAX
(CHARGE)
/CREDIT
AFTER
TAX
BEFORE
TAX
TAX
(CHARGE)
/CREDIT
AFTER
TAX
Gains (net of tax) on revaluation
of land and buildings
4,287(989)3,298–––
Fair value (loss)/gain (net of tax)
in cash flow hedge reserve
1,060(296)764(4,833)1,353(3,480)
Increase in share option reserve
129–129105–105
6.2 Deferred tax
Deferred tax
$’00020172016
AMOUNTS RECOGNISED IN PROFIT OR LOSS
Depreciation
908395
Amortisation – fixed rent
301244
Provisions and accruals
830712
2,0391,351
AMOUNTS RECOGNISED DIRECTLY IN EQUITY
Asset revaluation reserve
(989)–
Cash flow hedges
644940
Total amount recognised
1,6942,291
MOVEMENTS
Balance at beginning of year
2,291763
Credited/(charged) to the income statement
688176
Credited/(charged) to equity
(1,285)1,352
Balance at end of the year
1,6942,291
6.3 Imputation credits
$’00020172016
Imputation credits available for subsequent reporting periods
14,18613,045
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
34

7. OTHER
7.1 Employee benefits
Wages and salaries, annual leave and sick leave
Liabilities for wages and salaries, including non monetary benefits, annual leave and accumulating sick leave
expected to be settled within 12 months of the reporting date are recognised in other payables in respect of
employees’ services up to the reporting date and are measured at the amounts expected to be paid when the
liabilities are settled. Liabilities for non accumulating sick leave are recognised when the leave is taken and
measured at the rates paid or payable.
Employee benefits
$’00020172016
Holiday pay accrual and other benefits
4,5003,929
7.2 Capital expenditure commitments
$’00020172016
Commitments in relation to store fitouts
7921,285
7.3 Contingencies
Contingent liabilities under contracts, guarantees and other agreements arising in the ordinary course of business
on which no loss is anticipated are as follows:
$’00020172016
Letters of credit
224197
Bank guarantee provided to the New Zealand Stock Exchange Limited
7575
Letters of credit
Bank letters of credit issued to secure future purchasing requirements are matched to a contingent asset of the
same value representing inventories purchased.
7.4 Related party transactions
During the year, the Company advanced and repaid loans to its subsidiaries by way of internal current accounts. In
presenting the financial statements of the Group, the effect of transactions and balances between fellow subsidiaries
and those with the Parent have been eliminated. All transactions with related parties were in the normal course of
business and provided on commercial terms.
The Group undertook transactions with the related interests of the majority shareholder as detailed below:
$’00020172016
T C Glasson
Rent on retail premises based on independent valuations
2,0101,087
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
35

7. OTHER (CONTINUED)
The following Directors received directors’ fees and dividends in relation to shares held personally as follows:
DIRECTORS’ FEESDIVIDENDS
$’0002017201620172016
Mr T C Glasson
68683,4473,336
Mr W J Bell
979764
Ms K Bycroft
7575––
Mr M Donovan
6868153
Mr G Popplewell
––5957
Mr M Ford
7574––
Advances to employees under the executive share scheme (refer note 5.2)
$’00020172016
Mr G Popplewell
–85
Payments to Mr G Popplewell
$’00020172016
Consulting fees
55–
Key management compensation was as follows:
$’00020172016
Short term employee benefits
2,8442,923
Share scheme benefit
129105
The Company operates an employee share scheme for certain senior executives and is outlined in Note 5.2.
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
36

7. OTHER (CONTINUED)
7.5 Financial risk management
Fair value estimation
Fair value estimates are classified in a hierarchy based on the inputs to valuation techniques used to measure fair
value. The different levels have been defined as follows:
– Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1).
– Inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2).
– Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs)
(Level 3).
The Group’s policy is to recognise transfers into and out of fair value hierarchy levels as of the date of the event
or change in circumstances that caused the transfer.
The Group has financial instruments that are classified as Level 2 within the fair value hierarchy. The fair value
of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is
determined by using valuation techniques. These valuation techniques maximise the use of observable market
data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required
to fair value an instrument are observable, the instrument is included within Level 2. Under Level 2 the Group holds
forward foreign exchange contracts. The fair value of these forward foreign exchange contracts is determined
using forward exchange rates at the balance sheet date, with the resulting value discounted back to present value.
Refer to note 7.5.4.
The Group’s land and buildings within property, plant and equipment is classified as Level 3 in the fair value
hierarchy as one or more of the significant inputs into the valuation are not based on observable market data.
Refer to note 4.2 for more information.
Derivatives
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently
re-measured to their fair value. The method of recognising the resulting gain or loss depends on whether the
derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. The Company
designates certain derivatives as either; (1) hedges of the fair value of recognised assets or liabilities or a firm
commitment (fair value hedge); or (2) hedges of highly probable forecast transactions (cash flow hedges).
The Group documents at the inception of the transaction the relationship between hedging instruments and
hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions.
The Group also documents its assessment, both at hedge inception and on an ongoing basis, whether the
derivatives that are used in hedging transactions have been and will continue to be highly effective in offsetting
changes in fair values or cash flows of hedged items.
Cash flow hedge
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow
hedges is recognised in equity in the cash flow hedge reserve. The gain or loss relating to the ineffective
portion is recognised immediately in the profit and loss component of statement of comprehensive income.
Amounts accumulated in equity are recycled in the statement of comprehensive income in the periods when
the hedged item will affect profit or loss (for instance when the forecast sale that is hedged takes place).
However, when the forecast transaction that is hedged results in the recognition of a non-financial asset
(for example, inventory) or a non-financial liability, the gains and losses previously deferred in equity are transferred
from equity and included in the measurement of the initial cost or carrying amount of the asset or liability.
When a hedging instrument expires or is sold or terminated, or when a hedge no longer meets the criteria for
hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised
when the forecast transaction is ultimately recognised in the statement of comprehensive income. When a forecast
transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately
transferred to the profit and loss component of the statement of comprehensive income.
Derivatives that do not qualify for hedge accounting
Certain derivative instruments do not qualify for hedge accounting. Changes in the fair value of these derivative
instruments are recognised immediately in the statement of comprehensive income.
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
37

7. OTHER (CONTINUED)
7.5.1 Financial risk factors
The Group’s activities expose it to various financial risks including, liquidity risk, credit risk, and market risk
(including currency risk and cash flow interest rate risk). The Group’s risk management strategy is to minimise
adverse effects on Comprehensive Income. Derivative financial instruments are used to hedge currency risk.
7.5.2 Liquidity Risk
Liquidity risk is the risk that the Group will be unable to meet its financial obligations as they fall due. The Group’s
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet
its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking
damage to the Group’s reputation.
The Group manages liquidity risk by maintaining adequate reserves, and by regularly monitoring cash flow.
At balance date, the Group had $12.552 million (2016: $14.191 million) in cash reserves and accordingly, management
consider liquidity risk to be relatively low.
The table below analyses the Group’s financial liabilities and gross-settled derivatives into relevant maturity
groupings based on the remaining period from the statement of financial position to the contractual maturity date.
The cash flow hedge “outflow” amounts disclosed in the table are the contractual undiscounted cash flows liable
for payment by the Group in relation to all forward foreign exchange contracts in place at balance date. The cash
flow hedge “inflow” amounts represent the corresponding inflow of foreign currency back to the Group as a result
of the gross settlement on those contracts, converted using the spot rate at balance date. The carrying value shown
is the net amount of derivative financial liabilities and assets as shown in the statement of financial position.
Trade payables are shown at carrying value in the table. No discounting has been applied as the impact of
discounting is not significant.
AS AT 1 AUGUST 2017
$’000
LESS THAN
3 MONTHS
3-12
MONTHSTOTAL
CARRYING
VALUE
Trade and other payables
17,355–17,35517,355
Employee benefits
4,500–4,5004,500
Total
21,855–21,85521,855
Forward foreign exchange contracts
Cash flow hedges:
– Outflow
(14,134)(40,233)(54,366)(54,366)
– Inflow
13,37839,09152,46952,068
Net
(756)(1,142)(1,897)(2,298)
AS AT 1 AUGUST 2016
$’000
LESS THAN
3 MONTHS
3-12
MONTHSTOTAL
CARRYING
VALUE
Trade and other payables
14,129–14,12914,129
Employee benefits
3,929–3,9293,929
Total
18,058–18,05818,058
Forward foreign exchange contracts
Cash flow hedges:
– Outflow
(20,160)(32,264)(52,424)(52,424)
– Inflow
17,92431,14249,06648,730
Net
(2,236)(1,122)(3,358)(3,694)
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
38

7. OTHER (CONTINUED)
7.5.3 Credit Risk
Credit risk is the risk of the failure of a debtor or counterparty to honour its contractual obligations resulting
in financial loss to the Group. The Group incurs credit risk from trade receivables and transactions with financial
institutions. The Group places its cash, short-term investments and derivative financial instruments with high
credit quality financial institutions. Retail sales are predominantly settled in cash or by using major credit cards.
0.4% (2016: 0.7%) of sales give rise to trade receivables. This maximum exposure to credit risk is carrying amount
of trade receivables.
Concentration of credit risk with respect to debtors is limited due to the large number of customers included in
the Group’s customer base.
The Group does not require collateral or other security to support financial instruments with credit risk.
7.5.4 Market Risk
Foreign exchange risk
The Group is exposed to foreign exchange risk arising from currency exposure predominantly with the US dollar
with the purchase of inventory from overseas suppliers.
The Board has established a Treasury Risk Policy to manage the foreign exchange risk. The policy is reviewed
on a regular basis, and management report monthly to the Board to confirm policy is adhered to. All committed
foreign currency requirements are fully hedged, and approximately 61% (2016: 58%) of anticipated foreign currency
requirements are hedged on a rolling twelve month basis.
The Group uses forward exchange contracts with major retail banks only to hedge its foreign exchange risk arising
from future purchases.
Forward exchange contracts – cash flow hedges
These contracts are used for hedging committed or highly probable forecast purchases of inventory. The contracts
are timed to mature during the month the inventory is shipped and the liability settled. The cash flows are expected
to occur at various dates within one year from balance date.
When forward exchange contracts have been designated and tested as an effective hedge the portion of the gain
or loss on the hedging instrument that is determined to be an effective hedge is recognised directly in equity.
These gains or losses will be released in the profit and loss in the statement of comprehensive income at various
dates over the following year as the hedged risk crystallises.
At balance date the Group had entered into forward exchange contracts to sell the equivalent of NZ$54.366 million
(2016: NZ$52.424 million), primarily in US Dollars. At balance date these contracts are represented by assets of
$Nil (2016: $Nil) and liabilities of $2.298 million (2016: $3.694 million). When foreign exchange contracts are not
designated and tested as an effective hedge, the gain or loss on the foreign exchange contract is recognised in
the profit and loss in the statement of comprehensive income.
At balance date there are no such contracts in place (2016: $Nil).
Interest rate risk
The Group has no interest bearing liabilities. Exposure to interest rate risk arises only from the impact on income
from operating cash flows as a result of interest bearing assets, such as cash deposits.
Sensitivity analysis
Based on historical movements and volatilities and management’s knowledge and experience, management believes
that the following movements are ‘reasonably possible’ over a 12 month period:
• Proportional foreign exchange movement of -10% (depreciation of NZD) and +10% (appreciation of NZD)
against the USD, from the year end rate of 0.7508 (2016: 0.7103)
• A parallel shift of +1% / -1% in the market interest rates from the year end deposit rate of 1.90% (2016: 2.00%)
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
39

7. OTHER (CONTINUED)
If these movements were to occur, the post-tax impact on profit and loss and equity for each category of
financial investment:
AS AT 1 AUGUST 2017INTEREST RATEFOREIGN EXCHANGE RATE
CARRYING-1%+1%-10%+10%
$’000AMOUNTPROFITEQUITYPROFITEQUITYPROFITEQUITYPROFITEQUITY
FINANCIAL ASSETS
Loans and receivables
Cash and cash equivalents
12,552(126)(126)126126––––
Accounts receivable
779––––––––
Advances to employees
238––––––––
FINANCIAL LIABILITIES
Liabilities at amortised cost
Trade and other payables
17,355––––445–(364)–
Employee benefits
4,500––––––––
Derivatives used for Hedging
Derivatives designated as
cash flow hedges (forward
foreign exchange contracts)
2,298–––––(745)–400
Total increase/decrease
(126)(126)126126445(745)(364)400
AS AT 1 AUGUST 2016INTEREST RATEFOREIGN EXCHANGE RATE
CARRYING-1%+1%-10%+10%
$’000AMOUNTPROFITEQUITYPROFITEQUITYPROFITEQUITYPROFITEQUITY
FINANCIAL ASSETS
Loans and receivables
Cash and cash equivalents
14,191(142)(142)142142––––
Accounts receivable
1,660–––––––-
Advances to Employees
346––––––––
FINANCIAL LIABILITIES
Liabilities at amortised cost
Trade and other payables
14,129––––549–(449)–
Employee benefits
3,929––––––––
Derivatives used for Hedging
Derivatives designated as cash
flow hedges (forward foreign
exchange contracts)
3,694–––––(335)–274
Total increase/decrease
(142)(142)142142549(335)(449)274
The Parent is not exposed to any interest rate or foreign exchange risk.
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
40

7. OTHER (CONTINUED)
7.5.5 Capital risk management
The Group’s objectives when managing capital are to maximise the value of shareholder equity and ensure that
the Group continues to safeguard its ability to continue as a going concern. Group capital consists of share capital,
reserves and retained earnings. In order to meet these objectives, the Group may adjust the amount of dividend
payment made to shareholders. The Group has no specific banking or other arrangements which require that the
Group maintain specific equity levels.
7.6 Events subsequent to balance date
Subsequent to year end, the Board has resolved to pay a final dividend of 17.0 cents (2016: 16.5 cents) per share
(fully imputed). The dividend will be paid on 18th December 2017 to all shareholders on the Company’s register
as at 5:00pm, 11 December 2017.
7.7 Standards, amendments and interpretations to existing standards
No new accounting policies have been adopted that are considered to have a significant impact on the
financial statements.
There have been no significant changes in accounting policies during the year.
New accounting standards, amendments and interpretations to existing standards that are not yet effective,
and have not been early adopted by the Group, are:
NZ IFRS 15: Revenue from contracts with customers (Effective date: periods beginning on or after 1 January 2018)
NZ IFRS 15, ‘Revenue from contracts with customers’ deals with revenue recognition and establishes principles for
reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of
revenue and cash flows arising from an entity’s contracts with customers. Revenue is recognised when a customer
obtains control of a good or service and thus has the ability to direct the use and obtain the benefits from the
good or service. The standard replaces NZ IAS 18 ‘Revenue’ and NZ IAS 11 ‘Construction contracts’ and related
interpretations. The standard is effective for annual periods beginning on or after 1 January 2018 and earlier
application is permitted. The Group intends to adopt NZ IFRS 15 on its effective date and does not expect it
to materially impact the Group.
NZ IFRS 9: Financial Instruments (Effective date: periods beginning on or after 1 January 2018)
NZ IFRS 9, ‘Financial instruments’, addresses the classification, measurement and recognition of financial assets
and financial liabilities. The complete version of NZ IFRS 9 was issued in September 2014. It replaces the guidance
in NZ IAS 39 that relates to the classification and measurement of financial instruments. NZ IFRS 9 retains but
simplifies the mixed measurement model and establishes three primary measurement categories for financial assets:
amortised cost, fair value through other comprehensive income and fair value through profit or loss. The basis of
classification depends on the entity’s business model and the contractual cash flow characteristics of the financial
asset. Investments in equity instruments are required to be measured at fair value through profit or loss with the
irrevocable option at inception to present changes in fair value in other comprehensive income not recycling.
There is now a new expected credit losses model that replaces the incurred loss impairment model used in NZ IAS
39. For financial liabilities there were no changes to classification and measurement except for the recognition of
changes in own credit risk in other comprehensive income, for liabilities designated at fair value through profit or
loss. NZ IFRS 9 relaxes the requirements for hedge effectiveness by replacing the bright line hedge effectiveness
tests. It requires an economic relationship between the hedged item and hedging instrument and for the ‘hedged
ratio’ to be the same as the one management actually use for risk management purposes. Contemporaneous
documentation is still required but is different to that currently prepared under NZ IAS 39. The standard is effective
for accounting periods beginning on or after 1 January 2018. Early adoption is permitted. The Group intends to adopt
NZ IFRS 9 on its effective date and does not expect it to materially impact the Group.
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
41

7. OTHER (CONTINUED)
NZ IFRS 16: Leases (Effective date: periods beginning on or after 1 January 2019)
NZ IFRS 16, ‘Leases’, replaces the current guidance in NZ IAS 17. Under NZ IFRS 16, a contract is, or contains, a
lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for
consideration. Under NZ IAS 17, a lessee was required to make a distinction between a finance lease (on balance sheet)
and an operating lease (off balance sheet). NZ IFRS 16 now requires a lessee to recognise a lease liability reflecting
future lease payments and a ‘right-of-use asset’ for virtually all lease contracts. Included is an optional exemption for
certain short-term leases and leases of low-value assets; however, this exemption can only be applied by lessees.
For lessors, the accounting for leases under NZ IFRS 16 is almost the same as NZ IAS 17. However, the guidance on
the definition of a lease has been updated (as well as the guidance on the combination and separation of contracts),
lessors will also be affected by the new standard. The standard is effective for accounting periods beginning on or
after 1 January 2019. Early adoption is permitted but only in conjunction with NZ IFRS 15, ‘Revenue from Contracts
with Customers’.
The Group currently intends to adopt NZ IFRS 16 on its effective date being for the year ended 1 August 2020,
and has yet to assess its full impact.
However based on preliminary assessments the Group has determined that NZ IFRS 16 will have a significant impact
on the Group’s statement of financial position and statement of comprehensive income, measurement and disclosures.
The statement of financial position will be impacted by the recognition of a right of use asset, and a corresponding
lease liability. The statement of comprehensive income will be impacted by the recognition of an interest expense and
an amortisation expense and the de-recognition of the current rental expense. The full impact on the statements has
yet to be finalised.
Notes to the financial statements
For the year ended 1 August 2017
Hallenstein Glasson Holdings Ltd Annual Report 2017
42

General disclosures
BOARD OF DIRECTORS
Directors of the Company in office at the end of the year or who ceased to hold office during the year:
DIRECTORQUALIFICATIONS/EXPERIENCESPECIAL RESPONSIBILITIES
Warren James BellM Com CA. Appointed December 1986. Mr Bell holds
appointments on a number of boards of private
companies, and is a professional director.
Chairman of Directors
Non-executive Director
Michael John DonovanANZIM. Appointed May 1990. Non-executive
Independent Director
Timothy Charles GlassonFounder of Glassons womenswear retail chain.
Appointed November 1985 on merger with
Hallensteins.
Non-executive Director
Graeme James PopplewellFormer CEO, B Com CA. Appointed March 1985.Non-executive Director
Malcolm FordAppointed June 2010. Background includes 20 years
with experience in direct sourcing particularly in Asia,
Mr Ford also has experience in brand management
across wholesale and retail markets.
Non-executive
Independent Director
Karen BycroftBSC, Postgrad Marketing. Appointed November 2014.
Background includes 25 years in Retail in the UK and
Australia with Marks and Spencer, Sears, Woolworths
and Country Road. Experience in Strategy, Marketing,
and Leadership. Also an Associate of Melbourne
Business School and Executive Coach.
Non-executive
Independent Director
PRINCIPAL ACTIVITIES OF THE GROUP
Hallenstein Glasson Holdings Limited is a non-trading Holding Company. The principal trading subsidiaries are
Glassons Limited, Glassons Australia Ltd (involved in the retail of women’s apparel), Retail 161 Limited, Retail 161
Australia Ltd (Storm brand), Hallenstein Bros Limited and Hallenstein Brothers Australia Limited (retail of men’s
apparel). The subsidiaries are 100% owned by Hallenstein Glasson Holdings Limited.
REVIEW OF OPERATIONS
(a) Consolidated results for the year ended 1 August 2017
$’00020172016
Operating revenue
239,004223,510
Profit before income tax
24,07019,061
Income tax
(6,801)(5,382)
Profit for the year
17,26913,679
(b) Dividend
An interim dividend of 14.5 cents per share together with a supplementary dividend of 2.558 cents per share
to non-resident shareholders was paid on 13th April 2017.
Subsequent to balance date the Directors have declared a final dividend of 17.0 cents per share payable
18th December 2017. Non-resident shareholders of the Company will also receive a supplementary dividend
of 3.0 cents per share. Dividends are fully imputed to New Zealand resident shareholders.

Hallenstein Glasson Holdings Ltd Annual Report 2017
43

General disclosures
DIRECTORS
(a) Remuneration and all other benefits
Remuneration of Directors
$’00020172016
Mr T C Glasson
6868
Mr W J Bell
9797
Mr M Donovan
6868
Mr M Ford
7574
Mr G Popplewell
364623
Ms K Bycroft
7575
7471,005
(b) Shareholdings
Beneficially held
20172016
W J Bell
20,14315,143
T C Glasson
11,950,58811,950,588
M J Donovan
–10,000
G J Popplewell
203,604203,604
M Ford
10,00010,000
Non-beneficially held
20172016
M Ford and M J Donovan as custodians for Staff Share Scheme
701,760541,636
(c) Interests in share dealing
M Ford and M Donovan as Trustees for share purchase scheme
DAT E
PURCHASE/(SALE)
NUMBER OF SHARES$
On market purchase
06/04/2017 24,273 84,302
On market purchase
07/04/2017 32,482 112,399
On market purchase
05/04/2017 84,727 303,294
On market purchase
02/11/2016 12,733 38,313
On market purchase
1/11/2016 20,500 61,685
On market sale
05/04/2017(14,591) (51,788)
Mr W J Bell
Off market transfer
16/11/2016 5,000 –
Hallenstein Glasson Holdings Ltd Annual Report 2017
44
Hallenstein Glasson Holdings Ltd Annual Report 2017
44

General disclosures
(d) Disclosures of interests by Directors
W J Bell
T C Glasson
ChairmanSt Georges Hospital Inc
DirectorSabina Ltd
DirectorRyman Healthcare Group of Companies
DirectorMantles Ltd
DirectorAlpine Energy Group of Companies
DirectorGlasson Trustee Ltd
DirectorCyprus Enterprises and Meadow Mushrooms
DirectorCHC Properties Ltd
Group of Companies
DirectorJCG Trustee Ltd
DirectorSabina Ltd
Director152 Hereford Ltd
DirectorGlasson Trustee Ltd
DirectorSIG Trustee Ltd
Director152 Hereford Ltd
TrusteeHallenstein Glasson Staff Benefit Trust
DirectorCHC Properties Ltd
DirectorWarren Bell Ltd
M Ford
DirectorPoraka Ltd
TrusteeHallenstein Glasson Staff Benefit Trust
M Donovan
K Bycroft
DirectorMike and Carol Donovan Trustee Ltd
AdvisorySpotlight Retail Group
DirectorDonovan’s Ltd
Board Member
G J Popplewell
None
(e) Directors’ insurance
As provided by the Company’s Constitution and in accordance with Section 162 of the Companies Act 1993 the
Company has arranged Directors’ and Officers’ Liability Insurance that ensures Directors will incur no monetary
loss as a result of actions undertaken by them as Directors provided they act within the law.
(f) Directors’ and Officers’ use of Company information
During the period the Board received no notices pursuant to Section 145 of the Companies Act 1993 relating to
use of Company information.
STATE OF AFFAIRS
The Directors are of the opinion that the state of affairs of the Company is satisfactory. Details of the period under
review are included in the Chairman’s Report and the audited statement of comprehensive income.
Hallenstein Glasson Holdings Ltd Annual Report 2017
45
Hallenstein Glasson Holdings Ltd Annual Report 2017
45

EMPLOYEE REMUNERATION
The number of employees with the Group (other than Directors) receiving remuneration and benefits above
$100,000 in relation to the year ended 1 August 2017 was:
EMPLOYEE REMUNERATION20172016
100,000-109,999
61
110,000-119,999
13
120,000-129,999
44
130,000-139,999
22
140,000-149,999
21
150,000-159,999
11
160,000-169,999
14
170,000-179,000
31
180,000-189,999
1–
190,000-199,999
––
200,000-209,999
2–
210,000-219,999
25
220,000-229,999
12
230,000-239,999
11
250,000-259,999
––
260,000-269,999
12
270,000-279,999
11
280,000-289,999
11
290,000-299,999
1–
300,000-309,999
–2
310,000-319,999
1–
350,000-359,999
1–
360,000-369,999
–1
390,000-399,999
1–
400,000-409,999
––
440,000-449,999
–1
580,000-589,999
––
590,000-599,999
––
610,000-619,999
–1
620,000-629,9991–
640,000-649,9991–
730,000-739,9991–
REMUNERATION TO AUDITORS
The fee for the audit of the Holding Company and subsidiaries, paid to PricewaterhouseCoopers, was $125,980.
General disclosures
Hallenstein Glasson Holdings Ltd Annual Report 2017
46

Corporate governance
The Board of Directors is elected by shareholders to oversee the management of the Company and is responsible for
all corporate governance matters and reporting to shareholders. The Board has adopted a charter incorporating the
features of the NZX Corporate Governance Best Practice code. The charter is available at www.hallensteinglasson.co.nz.
The Board establishes the Company’s objectives, determines the strategies for achieving those objectives, and
monitors management performance. It also establishes delegated authority limits for capital expenditure, treasury,
and remuneration.
The principal trading activities, Glassons and Hallensteins, comprise separate subsidiaries, each with its own
management team and Board. The Group Board delegates the responsibility for the day-to-day management of
each subsidiary to the Board and management of that subsidiary. The Board is responsible for the appointment of,
and assessment of the performance of, the Chief Executive Officer and the members of the senior management team.
The Board meets at least ten times each year, and in addition a full corporate strategy meeting is held each year.
Directors receive monthly reporting including profit and loss and balance sheets for each operating subsidiary,
together with operations reports from the senior executive from each business unit.
BOARD MEMBERSHIP
At the date of signing the Annual Report, the Board consisted of six non-executive Directors. In recognition of the
importance of independent views and the Board’s role in supervising the activities of management, the Chairperson
is a non-executive Director.
Independent Directors at the date of this report are:
M J Donovan
M J Ford
K Bycroft
Other non-executive Directors are:
W J Bell (Chairman)
T C Glasson
G Popplewell
The constitution of the Company requires at least one-third of the Directors or, if their number is not a multiple of
three, then the number nearest to one-third, shall retire from office at the annual meeting each year, but shall be
eligible for re-election at that meeting. Those to retire shall be those who have been longest in office since they were
last elected or deemed elected.
The Board may at any time appoint a person to be a Director either as an additional Director or to fill a casual
vacancy. Any person who is appointed a Director by the Board shall retire from office at the next annual meeting
of the Company, but shall be eligible for re-election at that next meeting.
A list of the Directors and their qualifications is on page 43 of this report.
Hallenstein Glasson Holdings Ltd Annual Report 2017
47

Corporate governance
COMMITTEE STRUCTURE
The Board has established three committees, comprising non-executive Directors.
Remuneration Committee
• Comprises the non-executive members of the Board, and is chaired by Mr T Glasson. The function of the
Committee is to make specific recommendations on remuneration packages and other terms of employment
for Directors and executive Directors. The Committee utilises independent advice where necessary to ensure
remuneration practices are appropriate for the Company, and to ensure the best possible people are recruited
and retained. The remuneration committee charter is available at www.hallensteinglasson.co.nz.
Audit Committee
• Comprises the non-executive members of the Board, and is chaired by Mr M J Ford. The Committee meets
directly with the external auditors at least twice a year, and receives all correspondence between the Company
and its auditors. The other main responsibilities of the Committee is to ensure internal controls are effective,
financial reporting is reliable, applicable laws and regulations are complied with, and auditor independence is
maintained. The audit committee charter is available at www.hallensteinglasson.co.nz.
Nomination Committee
• Comprises the non-executive members of the Board, and is chaired by Mr M J Donovan. When appropriate,
the committee will make recommendations on the appointment of Directors. The nominations committee charter
is available at www.hallensteinglasson.co.nz.
Health and Safety Committee
• Comprises the non- executive members of the Board and is chaired by Ms K Bycroft. The committee oversees the:
– Existing systems and processes
– Approval of health & safety policies and procedures
– Monitoring of any incidents, hazards and risks
– Communication to the Board and ensures the Board and Directors are informed on matters relating to health
and safety governance, performance and compliance
– Regular assessments on health and safety systems.
The health and safety committee charter is available at www.hallensteinglasson.co.nz.
DIVERSITY
A breakdown of gender composition of Directors and Officers as at 1 August 2017 is shown below:
Gender Diversity as at 1 August
20172016
Directors
Female
11
Male
55
Officers
Female
22
Male
66
The Company does not have a formal diversity policy.
Hallenstein Glasson Holdings Ltd Annual Report 2017
48

REPORTING AND DISCLOSURE
Reporting to shareholders and the market generally is in accordance with generally accepted accounting principles,
and the Board ensures compliance with relevant legislation and NZX requirements. The Board is responsible
for ensuring it meets its obligation for continuous disclosure in accordance with the NZX Listing Rule 10.1 and
acknowledges that shareholders and the investment market generally should be promptly informed of any events
that may be price sensitive as regards the Company’s’ share value.
The Board has a formal procedure which must be followed when Directors, senior employees, or related parties
wish to trade in the Company’s shares. They must notify and obtain consent from the Board prior to trading in HLG
shares, and are only permitted to trade within two window periods. They are between the full year announcement
date (during September) and 1 January, and between the half year announcement date (during March) and 1 July.
The Directors’ shareholdings, trading of shares together with other matters for disclosure are set out on page 44
of this report.
BOARD REMUNERATION
Details of Directors remuneration are shown on page 44 of this report.
Shareholders are asked to approve fees each year. Fees are established using independent surveys covering
New Zealand based organisations of a similar scope and size.
Key executive remuneration comprises a base salary, together with an “at risk” component which is earned subject
to Company profitability. The remuneration committee seeks independent advice where appropriate when setting
key executive remuneration.
RISK ASSESSMENT
The Board regularly reviews risk, and maintains insurance cover with reputable insurers for most types of insurable risk.
HEALTH AND SAFETY
The Company has health and safety systems and processes in place that includes training employees and recording
any incidents, hazards and risks. These systems ensure we continue to provide a safe working environment for staff,
contractors and customers.
The Parent indemnifies all Directors named in this report, and current and former executives of the Group against
all liabilities (other than to the Parent or member of the Group), which arise out of their normal duties as Director
or executive Officers, unless the liability relates to conduct involving lack of good faith. To manage this risk, the
Group has indemnity insurance.
AUDIT
The external audit is undertaken by PricewaterhouseCoopers. The Board acknowledges the independence of
auditors, and only seeks additional services from PricewaterhouseCoopers where any threats to independence
can be appropriately mitigated.
SHAREHOLDER RELATIONS
The Company releases all information to the NZX, and also posts any announcements to the Company website at
www.hallensteinglasson.co.nz. Key information, including annual reports, the constitution and Board charters are
also posted for ease of reference. The Board approves all communication with shareholders.
Shareholders are encouraged to attend annual meetings, and these are held at different cities within New Zealand
on a rotation basis so that as many shareholders as possible have the opportunity to attend. The external auditors
are required to be available at each annual meeting.
Corporate governance
Hallenstein Glasson Holdings Ltd Annual Report 2017
49

Shareholder information
Hallenstein Glasson Holdings Ltd Annual Report 2017
50
ANALYSIS OF SHAREHOLDING AS AT 28 SEPTEMBER 2017
RANGE
HOLDER
COUNT
HOLDER
COUNT %
HOLDING
QUANTITY
HOLDING
QUANTITY %
1 to 99761.242,3530.00
100 to 1991011.6513,4680.02
200 to 4992924.7893,4800.16
500 to 9994467.31296,6120.50
1,000 to 1,9991,15518.921,516,9122.54
2,000 to 4,9991,90931.275,759,7369.66
5,000 to 9,9991,05617.306,788,55111.38
10,000 to 49,99995515.6416,556,81327.76
50,000 to 99,999611.004,004,8246.71
100,000 to 499,999460.758,219,69613.78
500,000 to 999,99960.103,439,8735.77
1,000,000 to 9,999,999,999,99920.0312,956,74321.72
Total
6,10599.9959,649,061100.00
TOP 20 SHAREHOLDERS AS AT 28 SEPTEMBER 2017
RANKNAMEADDRESSUNITS
% OF
UNITS
1.TIMOTHY CHARLES GLASSONPO Box 248, Christchurch 814011,950,58820.035
2.FNZ CUSTODIANS LIMITEDPO Box 396, Wellington 61401,006,1551.687
3.FORSYTH BARR CUSTODIANS LIMITEDPrivate Bag 1999, Dunedin 9054775,1671.300
4.HSBC NOMINEES (NEW ZEALAND) LIMITED
– NZCSD
PO Box 5947, Wellesley Street,
Auckland 1141
585,1940.981
5.KEVIN JAMES HICKMAN & JOANNA
HICKMAN & JOHN ANTHONY CALLAGHAN
PO Box 79084, Avonhead,
Christchurch 8446
565,0000.947
6.JBWERE (NZ) NOMINEES LIMITEDPrivate Bag 92085, Victoria Street
West, Auckland 1142
511,6650.858
7.INVESTMENT CUSTODIAL SERVICES
LIMITED
PO Box 35, Shortland Street,
Auckland 1140
502,8470.843
8.KEVIN JAMES HICKMAN & JOANNA
HICKMAN
24 Waiwetu Street, Fendalton,
Christchurch 8052
500,0000.838
9.CUSTODIAL SERVICES LIMITEDPO Box 13155, Tauranga 3141491,9570.825
10.ACCIDENT COMPENSATION CORPORATION
– NZCSD
c/- Jp Morgan Att Asset Services,
PO Box 5652, Wellington 6140
450,0000.754
11.CUSTODIAL SERVICES LIMITEDPO Box 13155, Tauranga 3141447,1530.750
12.JOHN FRANCIS MANAGHPO Box 1022, Napier 4140389,0630.652
13.CITIBANK NOMINEES (NEW ZEALAND)
LIMITED – NZCSD
GPO Box 764G, Melbourne VIC
3000, AUSTRALIA
357,7320.600
14.CUSTODIAL SERVICES LIMITEDPO Box 13155, Tauranga 3141298,5780.501
15.JPMORGAN CHASE BANK NA NZ BRANCH-
SEGREGATED CLIENTS ACCT – NZCSD
Att: Asset Services, PO Box 5652240,2590.403
16.CUSTODIAL SERVICES LIMITEDPO Box 13155, Tauranga 3141237,8780.399
17.ASB NOMINEES LIMITEDPO Box 35, Shortland Street,
Auckland 1140
228,3100.383
18.GRAEME JAMES POPPLEWELL26 Lemington Road, Westmere,
Auckland 1022
203,6040.341
19.ASB NOMINEES LIMITEDPO Box 35, Shortland Street,
Auckland 1140
201,4590.338
20.GEM LIMITEDPO Box 209, Dunedin 9054200,0000.335
Totals: Top 20 holders of ordinary shares20,142,60933.77
Total remaining holders balance39,506,45266.23

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