DGL – 2019 Full Year Results

1. The financial statements for the year ended 30 June 2018 have been restated following the adoption of “NZ IFRS 15: Revenue from
Contracts with Customers” on 1 July 2018. Refer to Note 1 of the Financial Statements.
2. Operating Performance is a non-GAAP measure and as such does not have a standardised meaning prescribed by GAAP. It may
therefore not be comparable to non-GAAP measures presented by other entities.

DELEGAT GROUP LIMITED
Results for announcement to the market
Reporting Period 12 months to 30 June 2019
Previous Reporting
Period
12 months to 30 June 2018

Amount (000s) Percentage change
Revenue from ordinary activities
1
$277,974 9%
Operating Profit from ordinary activities
after tax (Operating NPAT)
2

$51,429 14%
Operating Profit from ordinary activities
before interest, tax and depreciation
(Operating EBITDA)
1

$99,215 11%
Reported Profit from ordinary activities
after tax attributable to shareholders
$47,360 1%
Net profit attributable to shareholders $47,360 1%

Audit The financial statements attached to this report have been audited and are not
subject to a qualification. A copy of the audit report applicable to the full
financial statements is attached to this announcement.

Comments Refer to the Executive Chairman’s Report appended.

Dividends
The Directors have declared a final dividend of 17.0 cents per share. The dividend will be fully imputed
and a supplementary dividend of 3.4000 cents will be paid to overseas shareholders in accordance with
Listing Rule 7.12.7.

Cents per share Cents per share (imputed)
Final Dividend for the
year ended 30 June 2019
17.0 cents 6.6111 cents

Record Date 27 September 2019
Dividend Payment Date 11 October 2019

Net Tangible Assets per share
Current Year Previous corresponding year
Net Tangible Assets per
share
$3.70 $3.39

2
7
12
13
14
16
18
21
60
Executive Chairman’s Report
Managing Director’s Report
Statement of Financial Performance
Statement of Other

Comprehensive Income
Statement of Changes in Equity
Statement of Financial Position
Statement of Cash Flows
Notes to the Financial Statements
Independent Auditor’s Report
CONTENTS
Last year
glasses of our wine
were enjoyed by
wine lovers around
the world.
180
million

1

On behalf of the Board of Directors of Delegat Group
Limited, I am pleased to present its operating and
financial results for the year ended 30 June 2019, which
has been a very successful financial year for the Group.
The Group has achieved a significant milestone of global
cases sales exceeding 3 million cases for the first time
and reporting another record profit as we continue our
journey building a leading global Super Premium wine
company. We are now one of the largest and most
successful wine companies in Australasia, recognised
both globally and within New Zealand for our positive
and meaningful contribution to the wine industry.
PERFORMANCE HIGHLIGHTS
• Record global case sales of 3,008,000, up 10%.
• Record operating NPAT of $51.4 million, up 14%.
• Strong operating cash from operations of $55.4
million.
• Recognition of Oyster Bay as one of the world’s most
admired wine brands.
The Group presents its financial statements in accordance
with the New Zealand equivalents to International
Financial Reporting Standards (NZ IFRS).
To provide further insight into the Group’s underlying
operational performance, the Group has also included
in this report an Operating Performance Report. This
Operating Performance Report excludes the impact of fair
value adjustments required under NZ IFRS for grapes and
derivative instruments. As a fully integrated winemaking
and sales operation, Operating Profit includes the fair
value adjustment in respect of grapes when packaged
wine is sold, and the fair value adjustment on derivative
instruments when these foreign exchange contracts and
interest rate swaps are realised.
The Group has included a reconciliation of Operating
Profit to Reported Profit which eliminates from each line
in the Statement of Financial Performance all fair value
adjustments
1
.
“Delegat is a
unique wine
industry
success story
within the
fast growing
global Super
Premium
wine market.”
JIM DELEGAT EXECUTIVE CHAIRMAN
EXECUTIVE CHAIRMAN’S
REPORT •2019
1
Operating Performance is a non-GAAP measure and as such does not have a standardised meaning
prescribed by GAAP. It may therefore not be comparable to non-GAAP measures presented by
other entities. The Executive Chairman and Managing Director’s Reports are read by the auditors
as part of their responsibilities in respect of other information as disclosed in their audit report.
DELEGAT ANNUAL REPORT 2019 EXECUTIVE CHAIRMAN’S REPORT
2

OPERATING PERFORMANCE
A record operating NPAT of $51.4 million was generated compared to $44.9 million last year. Operating
EBIT of $83.7 million is $9.2 million higher than last year. Operating expenses at $55.4 million are in line
with last year.
Delegat achieved Operating Revenue of $278.0 million on global case sales of 3,008,000 in the year.
Revenue is up $22.2 million on last year, due to a 10% increase in global case sales, underlying price,
market and product mix changes and the favourable impact of foreign exchange rate changes.
The Group’s case sales performance and foreign currency rates achieved are detailed in table 2.
NZ IFRS FAIR VALUE ADJUSTMENTS
In accordance with NZ IFRS the Group is required to account for certain assets at ‘fair value’ rather than
at historic cost. All movements in these fair values are reflected in and impact the Statement of Financial
Performance. The Group records adjustments in respect of two significant items at the year-end as detailed
in table 3.
• Harvest Provision Release (Grapes) – Inventory is valued at market value, rather than costs incurred, at
harvest. Any fair value adjustment is excluded from Operating Performance for the year, by creating a
Harvest Provision. This Harvest Provision is then released through Cost of Sales when inventory is sold
in subsequent years. This represents the reversal of prior periods’ fair value adjustments in respect of
biological produce as finished wine is sold in subsequent years. In 2019, the market value of the company
grapes exceeded the costs incurred by $14.0 million (2018: $21.7 million). This write-up is lower than last
year due to a lower yielding 2019 vintage. This write-up, less the impact of prior years’ vintages being
sold, has resulted in a net write-down of $4.2 million for the year (2018: write-up of $5.5 million);
June 2019 June 2018 % change
Actual Actual vs 2018
NZ$ millions Restated*
Operating Revenue
1
278.0 255.8 9%
Operating Gross Profit
2
139.1 130.3 7%
Operating Gross Margin 50% 51%
Operating Expenses
3
(55.4) (55.8) 1%
Operating EBIT
4
83.7 74.5 12%
Operating EBIT % of Revenue 30% 29%
Interest and Tax (32.3) (29.6) -9%
Operating NPAT
4
51.4 44.9 14%
Operating NPAT % of Revenue 18% 18%
Operating EBITDA
4
99.3 89.6 11%
Operating EBITDA % of Revenue 36% 35%
Notes:
1. Operating Revenue is before fair value movements on derivative instruments (if gains).
2. Operating Gross Profit is before the net fair value movements on biological produce (harvest adjustment) and the NZ IFRS adjustments excluded in Note 1.
3. Operating Expenses are before fair value movements on derivative instruments (if losses).
4. Operating EBIT, EBITDA and NPAT are before any fair value adjustments.
Table 1 Operating Performance
* The financial statements for the year ended 30 June 2018 have been restated following the adoption of NZ IFRS 15: Revenue from Contracts with Customers on 1 July 2018. Refer to Note 1 of the
financial statements.
DELEGAT ANNUAL REPORT 2019 EXECUTIVE CHAIRMAN’S REPORT
3

• Derivative Instruments held to hedge the Group’s foreign currency and interest rate exposure. The mark-to-
market movement of these instruments at balance date resulted in a fair value write-down of $1.5 million
(2018: write-down of $2.9 million);
These adjustments, net of taxation, amount to a write-down of $4.0 million for the year (2018: write-up of
$1.9 million).
RECONCILIATION OF REPORTING TO OPERATING PERFORMANCE
Accounting for all fair value adjustments under NZ IFRS, the Group’s reported audited financial performance
for the year ended 30 June 2019 is reconciled to operating profit as detailed in table 4.
CASH FLOW
The Group generated Cash Flows from Operations of $55.4 million in the current year, which is a decrease
of $2.3 million on the previous year, primarily due to an increase in tax payments. A total of $32.6 million
was paid for additional property, plant and equipment during the year, including vineyard and winery
developments. The Group distributed $15.2 million to shareholders in dividends. A net repayment of $6.3
million was made to reduce borrowings during the year.
The Group refinanced a $330.0 million syndicated senior debt facility and is well positioned to fund both
its current operations as well as future capital investment in both New Zealand and Australia. The Group’s
net debt at 30 June 2019 amounted to $270.3 million, a decrease of 4% compared to last year.
DIVIDENDS
The Directors consider that the underlying operational performance and continued strong cash flows justify
an increase in dividends this year. Accordingly, the Directors are pleased to advise they have approved a
fully imputed dividend payout of 17.0 cents per share. The dividend will be paid on 11 October 2019 to
Shareholders on record at 27 September 2019.
June 2019 June 2018 % change
Actual Actual vs 2018
Case Sales (000s) Restated*
UK, Ireland and Europe 896 687 30%
North America (USA and Canada) 1,332 1,250 7%
Australia, NZ and Asia Pacific 780 799 -2%
Total Cases 3,008 2,736 10%

Foreign Currency Rates
GB£ 0.5146 0.5349 4%
AU$ 0.9320 0.9181 -2%
US$ 0.6774 0.7037 4%
CA$ 0.8888 0.9041 2%
Table 2 Case Sales and Foreign Currency
* The financial statements for the year ended 30 June 2018 have been restated following the adoption of NZ IFRS 15: Revenue from Contracts with Customers on 1 July 2018. Refer to Note 1 of the
financial statements.
DELEGAT ANNUAL REPORT 2019 EXECUTIVE CHAIRMAN’S REPORT
4

INVESTING FOR GROWTH
The record results achieved in 2019 are testament to the strength of the Group’s business model as we
continue to invest for growth.
Delegat is investing to support its strategic goal building a leading global Super Premium wine company.
During the year under review $32.9 million was invested in growth assets including development of the
Group’s wineries, land acquisition and vineyard development in New Zealand and the Barossa Valley.
Delegat will invest an additional $43.3 million in 2020 to provide earnings growth in the years ahead. This
capital investment supports the Group’s plan to grow sales to 3,651,000 cases by 2022 and will provide for
further growth beyond that period.
OUR GREAT WINE PEOPLE
The Board would like to take this opportunity to acknowledge our Delegat Great Wine People around the
world. Our global team have once again shown great resolve and set new performance records on our
journey building a leading global Super Premium wine company. It is inspiring to work with such a talented
team who are committed to winning together.
JIM DELEGAT EXECUTIVE CHAIRMAN


June 2019 June 2018 % change
NZ$ millions Actual Actual vs 2018
Operating NPAT 51.4 44.9 14%
Operating NPAT % of Revenue 18% 18%
NZ IFRS Fair Value Items
Biological Produce (Grapes)
1
(4.2) 5.5 n/m
2
Derivative Instruments (1.5) (2.9) 48%
Total Fair Value Items (5.7) 2.6 n/m
2
Less: Tax 1.7 (0.7) n/m
2
Fair Value Items after Tax (4.0) 1.9 n/m
2
Reported NPAT 47.4 46.8 1%
Notes:
1. Biological Produce (Grapes) is the difference between market value paid for grapes versus the cost to grow grapes.
The Harvest Provision is reversed and only recognised when the finished wine is sold.
2. n/m means not meaningful.
Table 3 Impact of Fair Value Adjustments
DELEGAT ANNUAL REPORT 2019 EXECUTIVE CHAIRMAN’S REPORT
5

“Our trusted
global Super
Premium
wine brands
continue to
drive record
business
performance.”

JIM DELEGAT EXECUTIVE CHAIRMAN
Table 3 Impact of Fair Value Adjustments
Notes:
1. EBIT means earnings before interest and tax.
2. NPAT means net profit after tax.
3. EBITDA means earnings before interest, tax, depreciation and amortisation.




Operating Fair Value Reported Operating Fair Value Reported
NZ$ millions Adjustment Adjustment
Revenue 278.0 – 278.0 255.8 – 255.8
Cost of Sales (138.9) (4.2) (143.1) (125.5) 5.5 (120.0)
Gross Profit 139.1 (4.2) 134.9 130.3 5.5 135.8
Operating Expenses (55.4) (1.5) (56.9) (55.8) (2.9) (58.7)
EBIT
1
83.7 (5.7) 78.0 74.5 2.6 77.1
Interest and Tax (32.3) 1.7 (30.6) (29.6) (0.7) (30.3)
NPAT
2
51.4 (4.0) 47.4 44.9 1.9 46.8
EBIT
1
83.7 (5.7) 78.0 74.5 2.6 77.1
Depreciation 15.6 – 15.6 15.1 – 15.1
EBITDA
3
99.3 (5.7) 93.6 89.6 2.6 92.2
2019 Actual2018 Actual
Restated*
Table 4 Reconciliation of Reporting to Operating Performance
* The financial statements for the year ended 30 June 2018 have been restated following the adoption of NZ IFRS 15: Revenue from Contracts with Customers on 1 July 2018. Refer to Note 1 of the
financial statements.
DELEGAT ANNUAL REPORT 2019 EXECUTIVE CHAIRMAN’S REPORT
6

The 2019 financial year represented a key milestone in
our long-term journey building a leading global Super
Premium wine company. As outlined in the Executive
Chairman’s report, the Group achieved record global
case sales, record Operating Net Profit after Tax of $51.4
million, and strong net cash flows from operations.
GLOBAL SALES PERFORMANCE
The Group achieved record global case sales of
3,008,000 cases in the year, which is 10% higher than
the previous year. Sales continue to be well diversified
by market with 44% in North America, 26% in the
Australia, New Zealand and Asia Pacific region, and
30% in Europe including the United Kingdom.
The Group has continued to invest in the development
of its own successful in-market distribution channels to
drive long-term growth. The Group’s Sales and Marketing
division has in-market sales teams in all major markets,
internationally and New Zealand.
AUSTRALIA, NEW ZEALAND AND ASIA PACIFIC
Case sales in the Australia, New Zealand and Asia Pacific
remained consistent at 780,000 cases.
In the established New Zealand and Australia markets
Oyster Bay continued to perform strongly as a category
leading Super Premium wine brand. In New Zealand,
Oyster Bay was voted Most Trusted Wine Brand by
consumers in the Reader’s Digest 2019 awards. In
Australia, Oyster Bay Sauvignon Blanc continues to
lead the category as the top selling Sauvignon Blanc
and bottled white wine by value.
1
Oyster Bay Pinot Gris
and Oyster Bay Rosé both achieved good growth in the
region, as did Barossa Valley Estate Grenache Shiraz
Mourvèdre.
1. IRI National Wine MAT To 07.04.19, AUD $13+
MANAGING DIRECTOR’S
REPORT •2019
“This year’s
record
global sales
and profit
is another
milestone on
our journey
building
a leading
global Super
Premium
wine
company.”

JOHN FREEMAN MANAGING DIRECTOR
DELEGAT ANNUAL REPORT 2019 MANAGING DIRECTOR’S REPORT
7

During the year the Group experienced very strong growth in China, with sales increasingly being executed
through the Tmall online flagship store. The store enables aspirational consumers throughout China to
purchase the Group’s brands directly from Delegat. Whilst China is currently a relatively small market for
the Group, it continues to represent an important long-term growth opportunity.
NORTH AMERICA
The Group again delivered strong growth in North America, increasing sales volumes by 7% to a record
1,332,000 cases.
In the United States, the Oyster Bay brand continued its strong growth, gaining distribution and rate of
sale across multiple channels. The Group’s success is underpinned by its well-established in-market sales
team working effectively with leading distributors, retailers and on premise venues. Oyster Bay Sauvignon
Blanc is a top 5 white wine over US$10 by value
2
. The Barossa Valley Estate brand continued to perform
well, particularly within the on premise channel, supporting the Group’s goal of increasing awareness and
affinity in this large market for Super Premium wine brands. Highlights included the successful introduction
of Oyster Bay Pinot Gris and Oyster Bay Rosé, demonstrating the rare ability of the Oyster Bay brand to
achieve success across a range of varietal categories.
The Group continues to build momentum through its expanded distribution arrangements with Southern
Glazer’s Wines and Spirits, North America’s largest wine and spirits distributor. The Group’s strong
relationships with Southern Glazer’s and our other distribution partners is a key factor driving the long-term
success of Oyster Bay and Barossa Valley Estate in the United States.
In Canada, Oyster Bay has delivered consistent strong performance, while maintaining category leading
ranking positions. Oyster Bay continues to be a top 5 Super Premium white wine, and Oyster Bay Pinot
Grigio continues to be the number one Pinot Grigio in British Columbia above C$13.
3
2. AC Nielsen 52 Weeks Ending 18.05.19, $10+
3. SORT/ACD Data MAT to June 2019, $12+
“Oyster Bay is now one of the leading
Super Premium white wine brands in the
USA, the world’s largest wine market.”
JOHN FREEMAN MANAGING DIRECTOR


2019 2020 2021 2022
Case Sales (000s) Actual Forecast Projection Projection
Total Cases 3,008 3,240 3,419 3,651
Table 5 Group Outlook Case Sales
DELEGAT ANNUAL REPORT 2019 MANAGING DIRECTOR’S REPORT
8

UNITED KINGDOM, IRELAND AND EUROPE
The United Kingdom, Ireland and Europe region resulted in a standout year, growing sales by 30%
to 895,000 cases, driven by distribution gains and successful promotional programming with key
National Account customers. Highlights for the Oyster Bay brand included significant growth within
the convenience retail sector. Oyster Bay Sauvignon Blanc, Chardonnay and Merlot continue to be the
top selling wines above £8
4
in their individual varietal categories irrespective of origin. Barossa Valley
Estate also delivered strong growth during the year, both in retail and in the on-premise channel,
supporting further growth in brand awareness and affinity.
In Ireland, Oyster Bay has maintained its Super Premium category leadership position, delivering
growth in key retail accounts. Oyster Bay Sauvignon Blanc, Chardonnay, Merlot and Pinot Noir are
the top selling New Zealand wines in their respective varietal categories above €10.
5
Barossa Valley
Estate Shiraz and Grenache Shiraz Mourvèdre are the top selling Australian wines in their respective
varietal categories above €12.
5

BRANDS AND COMMUNICATIONS
The Group’s goal is to establish Oyster Bay and Barossa Valley Estate as leading brands in the Super
Premium wine category globally.
The Group regularly conducts detailed research into the awareness and affinity of its brands amongst
premium wine consumers globally, in order to set targets and monitor progress. Marketing programmes
are designed to grow consumer awareness and to support distribution and rate of sale growth per
point of distribution. Marketing activities are focused on the specific needs of each market and phases
of brand development. The group works closely with its retail partners to activate high impact in-store
activation. In the consumer environment, the Group uses a mix of media channels both online and
offline to attract and engage consumers.
In recognition of its market performance and reputation, Oyster Bay has now been recognised as a
Blue Chip Brand by New York’s Impact Magazine, a status reserved only for brands of substantial size
and sustained over more than ten years. Oyster Bay was also recognised by Impact Magazine as a
‘Hot Brand’ for the ninth consecutive year, and was again named ‘One of the World’s Most Admired
Wine Brands’ by Drinks International Magazine UK.
E&E Black Pepper Shiraz achieved significant growth during the year, securing distribution in a number
of elite restaurants and fine wine retailers. E&E Black Pepper Shiraz is one of the defining luxury wines
of the Australian wine industry, with a long history of accolades and acclaim. Whilst production of
this iconic wine will be kept to a strictly limited volume, the Group is proud to continue offering
E&E Black Pepper Shiraz to discerning luxury wine consumers. The reputation of this wine has again
been reinforced through the 2015 vintage receiving an outstanding 92 point rating in Wine Spectator
magazine.
4. AC Nielsen MAT 15.06.2019, +£8 per 75cl
5. AC Nielsen MAT 30.12.2018, +€10 per 75cl
DELEGAT ANNUAL REPORT 2019 MANAGING DIRECTOR’S REPORT
9

INVESTING IN OUR PEOPLE
Our people are the key to realising our goals. We are extremely proud of our Delegat Great Wine People
that make up our global team, and we have thorough processes for recruiting talented and capable people
to join our team.
This year we have invested in expanding our capabilities in Learning & Development, with a focus on our
leaders across the globe. We believe in a learning culture, one where formal and informal learning both
play important roles in helping us to be more skilled, resilient and productive. This enables us to create
an aspirational environment for success in which our people can achieve or exceed their own career
aspirations.
We have also formally introduced Diversity and Inclusion planning, which not only benefits the people it
supports and enables, but is also a positive contributor to the Group’s long-term performance. Globally we
have an opportunity to benefit greatly from the different backgrounds and perspectives our people bring to
their work.
2019 HARVEST
The 2019 vintage is regarded as one of exceptional quality across all three of our wine regions, which each
delivered some of our most expressive wines to date.
The Group harvest of 35,500 tonnes was down 11% from the 2018 vintage. The New Zealand harvest was
33,900 tonnes. Yields were slightly lower than long term averages due to variable weather conditions during
spring flowering. The harvest for Barossa Valley Estate was 1,600 tonnes, yields again being below long-term
average levels.
The Group has appropriate inventories to achieve the future sales growth goals outlined in this report.
SUSTAINABILITY
Recognition and respect for the environment are reflected in the strong leadership role the Group plays
in the practice and promotion of sustainable wine growing and wine production. As a leader in the New
Zealand wine industry and as a founding member since 2002 of Sustainable Winegrowing New Zealand
(SWNZ), the Group takes its responsibilities to respect and protect the environment very seriously. The
Group’s New Zealand vineyards and wineries are 100% accredited by the independently audited SWNZ
Sustainability Programme. The Group applies many of these same principles in the Barossa Valley, again as
a leader of sustainable wine growing practices within the Australian wine industry.
DELEGAT ANNUAL REPORT 2019 MANAGING DIRECTOR’S REPORT
10

GROUP OUTLOOK
The Group’s strategic goal is to build a leading global Super Premium wine company. The Group will build
leading global brands from world leading regions, focusing on the wine styles for which those regions are
internationally renowned. Delegat plans to grow sales by 21% to 3,651,000 cases over the next three years.
The primary drivers of planned growth are Oyster Bay sales in North America, and Barossa Valley Estate
varietals globally. The Group observes that wine consumers, particularly in North America, increasingly
purchase Super Premium wine as an everyday affordable luxury that complements their lifestyle, across an
expanding range of varietal categories. Accordingly, the Group continues to seek opportunities globally to
further expand distribution and grow rate of sale per point of distribution.
The Group is well positioned to grow sales and achieve sustainable earnings growth in the years ahead.
With respect to the 2020 year, Delegat plans to grow sales by 8% to 3,240,000 cases.
Based on prevailing exchange rates, the Group forecasts to achieve a 2020 operating profit that is in line
with the 2019 record performance.
OUR PEOPLE
I wish to personally thank each of our Great Wine People for their efforts to aim high, pursue mastery and
win together. I have had the opportunity this past year to visit and spend time with all of our teams, and I
am inspired by their knowledge, passion and drive. Our global team has achieved another year of record
performance in 2019, and has positioned Delegat well on our journey building one of the world’s leading
Super Premium wine companies.
JOHN FREEMAN
MANAGING DIRECTOR
DELEGAT ANNUAL REPORT 2019 MANAGING DIRECTOR’S REPORT
11

STATEMENT OF FINANCIAL PERFORMANCE
Notes 2019 2018
$000 $000
Restated
*
Revenue 3 2 7 7, 9 74 255,762
Profit before finance costs 4 77,983 7 7,119
Finance costs 3 12,025 11,957
Profit before income tax 65,958 65,162
Income tax expense 15 18,598 18,326
Profit for the Year attributable to Shareholders of the Parent Company 4 7, 3 6 0 46,836
Earnings per share
– Basic and fully diluted earnings per share (cents per share) 5 46.83 46.31
* The financial statements for the year ended 30 June 2018 have been restated following the adoption of NZ IFRS 15: Revenue from Contracts with Customers on 1 July 2018. Refer to Note 1 of
the financial statements.
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
12

STATEMENT OF OTHER COMPREHENSIVE INCOME
* The financial statements for the year ended 30 June 2018 have been restated following the adoption of NZ IFRS 15: Revenue from Contracts with Customers on 1 July 2018. Refer to Note 1 of
the financial statements.
The accompanying notes form part of these financial statements
Notes 2019 2018
$000 $000
Restated
*
Profit after income tax 4 7, 3 6 0 46,836
Other comprehensive income that may subsequently be classified to the profit and loss:

– Translation of foreign subsidiaries 6b (1,812) 3,238
– Net gain/(loss) on hedge of a net investment 1,283 (1,112)
– Income tax relating to components of other comprehensive income 15 (359) 311
Total comprehensive income for the year, net of tax 46,472 49,273

Comprehensive income attributable to Shareholders of the Parent Company 46,472 49,273
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
13

STATEMENT OF CHANGES IN EQUITY
Note
Share
Capital
$000
Foreign
Currency
Translation
Reserve
$000
Retained
Earnings
$000
Total
Equity
$000
Balance at 30 June 2018 49,815 (2,698) 296,072 343,189
Changes in equity for the year ended 30 June 2019
Other comprehensive income
– Translation of foreign subsidiaries – (1,812) – (1,812)
– Net gain on hedge of a net investment – 1,283 – 1,283
– Income tax relating to components of
other comprehensive income 15 – (359) – (359)
Total other comprehensive income – (888) – (888)
– Net profit for the year – – 47,360 4 7, 3 6 0
Total comprehensive income for the year – (888) 47,360 46,472
Equity Transactions
– Dividends paid to shareholders 7 – – (15,177) (15,177)
Balance at 30 June 2019 49,815 (3,586) 328,255 374, 4 8 4
The accompanying notes form part of these financial statements
FOR THE YEAR ENDED 30 JUNE 2019
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
14

STATEMENT OF CHANGES IN EQUITY CONTINUED
Note
Share
Capital
$000
Foreign
Currency
Translation
Reserve
$000
Retained
Earnings
$000
Total
Equity
$000
Balance at 30 June 2017 49,815 (5,135) 262,389 307,069
Changes in equity for the year ended 30 June 2018
Other comprehensive income
– Translation of foreign subsidiaries – 3,238 – 3,238
– Net loss on hedge of a net investment – (1,112) – (1,112)
– Income tax relating to components of
other comprehensive income 15 – 311 – 311
Total other comprehensive income – 2,437 – 2,437
– Net profit for the year – – 46,836 46,836
Total comprehensive income for the year – 2,437 46,836 49,273
Equity Transactions
– Dividends paid to shareholders 7 – – (13,153) (13,153)
Balance at 30 June 2018 49,815 (2,698) 296,072 343,189
The accompanying notes form part of these financial statements
FOR THE YEAR ENDED 30 JUNE 2018
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
15

STATEMENT OF FINANCIAL POSITION
2019 2018
Notes $000 $000
Equity
Share capital 6 49,815 49,815
Foreign currency translation reserve 6b (3,586) (2,698)
Retained earnings 328,255 296,072
Total Equity 374,484 343,189
Liabilities
Current Liabilities
Trade payables and accruals 8 32,344 32,941
Derivative financial instruments 9 2,960 3,020
Income tax payable 6,445 6,485
41,749 42,446
Non-Current Liabilities
Deferred tax liability 15 35,588 33,754
Derivative financial instruments 9 6,321 3,7 11
Interest-bearing loans and borrowings 10 275,989 285,754
317,898 323,219
Total Liabilities 359,647 365,665
Total Equity and Liabilities 734,131 708,854

The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. AS AT 30 JUNE 2019
16

STATEMENT OF FINANCIAL POSITION CONTINUED
2019 2018
Notes $000 $000
Assets
Current Assets
Cash and cash equivalents 5,647 4,264
Trade and other receivables 11 40,014 42,635
Derivative financial instruments 9 1,088 –
Inventories 12 1 5 7, 8 5 8 1 4 7, 4 3 1
204,607 194,330
Non-Current Assets
Property, plant and equipment 13 524, 574 509,861
Intangible assets 14 4,950 4,663
529,524 514,524
Total Assets 734,131 708,854
For, and on behalf of, the Board who authorised the issue of the financial statements on 23 August 2019.
JN Delegat, Executive Chairman JA Freeman, Managing Director
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. AS AT 30 JUNE 2019
17

STATEMENT OF CASH FLOWS
2019 2018
$000 $000
Restated*

Operating Activities
Cash was provided from
Receipts from customers 279,963 250,359
Net GST received – 74
279,963 250,433
Cash was applied to
Payments to suppliers and employees 194,875 168,293
Net GST paid 413 –
Net interest paid 12,14 0 12,457
Net income tax paid 1 7, 1 1 4 11,914
224,542 192,664
Net Cash Inflows from Operating Activities 55,421 5 7, 7 6 9

Investing Activities
Cash was provided from
Proceeds from sale of property, plant and equipment 178 2,058
Dividends received 4 1
182 2,059
Cash was applied to
Purchase of property, plant and equipment 30,393 45,896
Purchase of intangible assets 490 451
Capitalised interest paid 1,851 1,692
32,734 48,039
Net Cash Outflows from Investing Activities (32,552) (45,980)
* The financial statements for the year ended 30 June 2018 have been restated following the adoption of NZ IFRS 15: Revenue from Contracts with Customers on 1 July 2018. Refer to Note 1 of
the financial statements.
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
18

STATEMENT OF CASH FLOWS CONTINUED
2019 2018
$000 $000
Restated*

Financing Activities
Cash was provided from
Proceeds from borrowings 295,642 28,514
295,642 28,514
Cash was applied to
Dividends paid to shareholders 15,169 13,147
Repayment of borrowings 301,949 2 7, 6 8 7
3 1 7, 1 1 8 40,834
Net Cash Outflows from Financing Activities (21,476) (12,320)

Net Increase / (Decrease) in Cash Held 1,393 (531)
Cash and cash equivalents at beginning of the year 4,264 4,479
Effect of exchange rate changes on foreign currency balances (10) 316
Cash and Cash Equivalents at End of the Year 5,647 4,264
* The financial statements for the year ended 30 June 2018 have been restated following the adoption of NZ IFRS 15: Revenue from Contracts with Customers on 1 July 2018. Refer to Note 1 of
the financial statements.
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
19

STATEMENT OF CASH FLOWS CONTINUED
2019 2018
$000 $000

Reconciliation of Profit for the Year with Cash Flows from Operating Activities:
Reported profit after tax 4 7, 3 6 0 46,836
Add/(deduct) items not involving cash flows
Depreciation expense 15,581 15,089
Other non-cash items (2,302) 2,733
Loss/(gain) on disposal of assets 95 (11)
Movement in derivative financial instruments 1,462 2,923
Movement in deferred tax liability 1,834 2,630
16,670 23,364

Movement in working capital balances are as follows:
Trade payables and accruals (597) 3,617
Trade and other receivables 2,621 (6,683)
Inventories (10,427) (13,751)
Income tax (40) 3,469

Add items classified as investing and financing activities
Capital purchases included within trade payables and inventories (166) 917
(8,609) (12,431)
Net Cash Inflows from Operating Activities 55,421 5 7, 7 6 9

Reconciliation of movement in Net Debt:
Opening balance at 1 July 281,490 278,034
Per statement of cash flows:
– (Repayment) /proceeds of borrowings (6,307) 827
– Net (increase) / decrease in cash held (1,393) 531
Foreign exchange movement (2,690) 1,94 0
Other non-cash movements (758) 158
Closing balance at 30 June 270,342 281,49 0
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
20

NOTES TO THE FINANCIAL STATEMENTS
1. GENERAL INFORMATION
REPORTING ENTITY
The financial statements presented are those of Delegat Group Limited and its subsidiaries (the Group). Delegat Group
Limited is a company limited by shares, incorporated and domiciled in New Zealand and registered under the Companies
Act 1993. The Parent shares are publicly traded on the New Zealand Stock Exchange.
The financial statements comprise the statement of financial performance, statement of other comprehensive income,
statement of changes in equity, statement of financial position and statement of cash flows, as well as the notes to the
financial statements. The financial statements for the Group for the year ended 30 June 2019 were authorised for issue
in accordance with a resolution of the Directors on 23 August 2019.
BASIS OF PREPARATION
The financial statements have been prepared in accordance with Generally Accepted Accounting Practice in New
Zealand (NZ GAAP) and the requirements of the Financial Markets Conduct Act 2013. For the purposes of complying
with NZ GAAP the entity is a for-profit entity. These financial statements are presented in New Zealand Dollars, rounded
to the nearest thousand. They are prepared on a historical cost basis except for derivative financial instruments and
biological produce which have been measured at fair value.
The preparation of the financial statements requires the Group to make judgements, estimates and assumptions that
affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and
associated assumptions are based on historical experience and various other factors that are believed to be reasonable
under the circumstances. Actual results may vary from these estimates. The estimates and underlying assumptions are
reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are
revised if the revision affects only that period, or in the period of revision and future periods if the revision affects both
current and future periods.
STATEMENT OF COMPLIANCE
The financial statements comply with New Zealand equivalents to International Financial Reporting Standards and other
applicable Financial Reporting Standards (NZ IFRS), as applicable to the Group as a profit-oriented entity. The financial
statements comply with International Financial Reporting Standards (IFRS).
BASIS OF CONSOLIDATION
The consolidated financial statements comprise the financial statements of the Group as at 30 June 2019 and 30 June
2018.
Subsidiaries are those entities over which the Group has control. Control is achieved when the Group is exposed, or has
rights, to variable returns from its investment in the entity, and has the ability to affect those returns through its power
over the entity. Specifically, the Group controls an entity if and only if the Group has:
– Power over the entity (i.e. existing rights that give it the current ability to direct the relevant activities of the investee);
– Exposure, or rights, to variable returns from its involvement with the entity, and;
– The ability to use its power over the investee to affect its returns.
The financial statements of the subsidiaries are prepared for the same reporting period as the Parent, using consistent
accounting policies. The effects of intercompany transactions are eliminated in preparing the consolidated financial
statements.
Subsidiaries are fully consolidated from the date on which control is obtained by the Group and cease to be consolidated
from the date on which control is transferred out of the Group. The acquisition of subsidiaries is accounted for using the
acquisition method of accounting as noted on the following pages.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
21

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
BUSINESS COMBINATIONS
The acquisition method of accounting is used to account for all business combinations regardless of whether equity
instruments or other assets are acquired. Cost is measured as the fair value of the assets given, shares issued or liabilities
incurred or assumed at the date of exchange. Where equity instruments are issued in a business combination, the fair
value of the instruments is their published market price at the date of the exchange unless, in rare circumstances, it can
be demonstrated that the published price at the date of exchange is an unreliable measure of fair value. Transaction costs
arising on the issue of equity instruments are recognised directly within equity.
Except for non-current assets or disposal groups classified as held for sale (which are measured at fair value less costs
to sell), all identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are
measured initially at their fair values as at acquisition date, irrespective of the extent of any non-controlling interests. The
excess of the cost of the business combination over the net fair value of the Group’s share of the identifiable net assets
acquired is recognised as goodwill. If the cost of the acquisition is less than the Group’s share of the net fair value of the
identifiable net assets of the subsidiary, the difference is recognised as a gain in the statement of financial performance,
but only after a reassessment of the identification and measurement of the net assets acquired.
Where settlement of any part of the consideration is deferred, the amounts payable in the future are discounted to the
present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being the rate
at which similar borrowings could be obtained from an independent financier under comparable terms and conditions.
GOODS AND SERVICES TAX (GST)
The statement of financial performance, statement of other comprehensive income, statement of changes in equity and
statement of cash flows have been prepared so that all components are stated net 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.
FOREIGN CURRENCIES
i) Functional and Presentation Currency
The presentation currency of the Group is the New Zealand Dollar. Each subsidiary company in the Group determines its
own functional currency and uses that functional currency for its individual financial statements. Subsidiary companies
with a different functional currency than that of the Group are translated through converting all reported assets and
liabilities at the closing rate at the date of the balance sheet, while income and expenses are translated at exchange rates
at the dates of the transactions. Any resulting exchange differences are recognised as a separate component of equity.
ii) Transactions and Balances
Transactions in foreign currencies are initially recorded in the functional currency by applying the exchange rates
ruling at the date of the transaction. Assets and liabilities denominated in foreign currencies are translated at the rate of
exchange ruling at the balance sheet date.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents in the statement of financial position comprise cash at bank, and in hand and short-term
deposits with an original maturity of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of change in value. For the purposes of the statement of cash flows, cash
and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts. Bank
overdrafts are included within interest-bearing loans and borrowings in current liabilities in the statement of financial
position.
1. GENERAL INFORMATION (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
22

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
NET DEBT
Net debt is the sum of the Group’s interest-bearing loans and borrowings less cash and cash equivalents.
OTHER ACCOUNTING POLICIES
Other accounting policies that are relevant to an understanding of the financial statements are provided throughout the
notes to the financial statements.
SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS
In applying the Group’s accounting policies, management continually evaluates the judgements, estimates and
assumptions based on experience and other factors, including expectations of future events that may have an impact
upon the Group. All judgements, estimates and assumptions made are believed to be reasonable based upon the most
current set of circumstances available to management. The actual results may differ from the judgements, estimates and
assumptions used. The significant judgements, estimates and assumptions made by management in the preparation of
these financial statements, are disclosed within the specific financial statement notes as shown below:
Area of Judgement or Estimate
Selling, marketing and promotional accruals
Fair value of derivative financial instruments
Fair value of grapes at point of harvest
Impairment of property, plant and equipment
Estimation of useful lives of assets
Impairment of intangible assets
Classification of vineyard leases
Note
Note 3 Segmental Reporting
Note 9 Derivative Financial Instruments
Note 12 Inventories
Note 13 Property, Plant and Equipment
Note 13 Property, Plant and Equipment
Note 14 Intangible Assets
Note 17 Commitments
To allow the Accounting Policies and Significant Accounting Judgements, Estimates and Assumptions to be easily
identified within the notes, Accounting Policies have been identified with an
symbol, and Significant Accounting
Judgements, Estimates and Assumptions with an
symbol.
CHANGES IN ACCOUNTING POLICIES
The accounting policies adopted are consistent with those of the previous financial year, with the exception of the
adoption of NZ IFRS 15: Revenue from Contracts with Customers and NZ IFRS 9: Financial Instruments on 1 July 2018.
NZ IFRS 15: Revenue from Contracts with Customers
On 1 July 2018, the Group adopted NZ IFRS 15: Revenue from Contracts with Customers, applying the fully retrospective
transition provision. NZ IFRS 15 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. NZ IFRS 15 supersedes NZ IAS 18: Revenue. The changes in NZ IFRS 15 do not have an impact on the timing
of revenue recognition or net profit after tax for the Group, however there are some selling, marketing and promotion
expenses that have been reclassified to revenue as part of the determination of the transaction price under NZ IFRS 15.
In accordance with the requirements of NZ IAS 8: Accounting Policies, Changes in Accounting Estimates and Error, the
financial statements for the period ended 30 June 2018 have been restated. The adoption of NZ IFRS 15 has not had an
impact on the statement of financial position.
1. GENERAL INFORMATION (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
23

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
The effect on the Group’s financial statements of the adoption of NZ IFRS 15 has been demonstrated in the table below:
June 2018
$000
Increase/
(decrease)
Financial statement line:
Statement of Financial Performance
Revenue (16,360)
Selling, marketing and promotion expenses (16,360)
Statement of Cash Flows
Receipts from customers (16,360)
Payments to suppliers and employees (16,360)
NZ IFRS 9: Financial Instruments
The Group has also adopted NZ IFRS 9: Financial Instruments with a date of initial application of 1 July 2018. The key
changes to the Group’s accounting policies resulting from its adoption of NZ IFRS 9 are summarised below.
Classification of financial assets
NZ IFRS 9 contains three principal classification categories for financial assets: measured at amortised cost, fair value
through other comprehensive income (FVOCI) and fair value through profit or loss (FVTPL). The classification of financial
assets under NZ IFRS 9 is generally based on the business model in which a financial asset is managed and its contractual
cash flow characteristics. Under NZ IFRS 9, the Group’s financial assets consist of: cash and trade receivables, measured
at amortised cost, and derivative financial instruments, measured at FVTPL.
Classification of financial liabilities
Under NZ IFRS 9, the Group’s financial liabilities are trade and other payables, measured at amortised cost, and
derivative financial instruments, measured at FVTPL.
Classification impact
The adoption of NZ IFRS 9 has not had a significant effect on classification or the Group’s accounting policies for
financial assets and liabilities.
Impairment of financial assets
NZ IFRS 9 replaces the ‘incurred loss’ model in NZ IAS 39: Financial Instruments: Recognition and Measurement with an
‘expected credit loss’ model. The new impairment model applies to financial assets measured at amortised cost. Under
NZ IFRS 9, credit losses are recognised earlier than under NZ IAS 39. Given the nature of the Group’s trade receivables,
the expected credit loss model does not result in the recognition of a material expected credit loss allowance.
Fair value through profit or loss
For the financial assets and liabilities of the Group held at fair value (foreign currency forward exhange contracts and
options, and interest rate swaps) the Group is required to separate the fair value movement that relates to changes in the
Group’s credit risk and record this through Other Comprehensive Income rather than through the Statement of Financial
Performance where the remaining change in value will be recorded. For the year ended 30 June 2018 and 30 June 2019
no portion of the fair value movement on the Group’s foreign currency forward exchange contracts and options, and
interest rate swaps, relates to changes in the Group’s credit risk, and therefore no amount is required to be incuded
within Other Comprehensive Income.
1. GENERAL INFORMATION (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
24

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
* For fiscal periods beginning on or after
Hedge Accounting
The Group applied hedge accounting under NZ IAS 39 to a borrowing of A$29,350,000 which has been designated as a
hedge of the net investment of Barossa Valley Estate Pty Limited (BVE). The hedge meets the effectiveness requirements
of NZ IAS 39 and also meets the requirements of NZ IFRS 9.
Transition
Changes in accounting policies resulting from the adoption of NZ IFRS 9 are applied retrospectively. There is no
restatement of prior periods as there is no significant change in the recognition and measurement of cash and trade and
other receivables and payables under the new standard.
NEW ACCOUNTING STANDARDS AND INTERPRETATIONS
Standards and Interpretations that have recently been issued or amended, but are not yet effective, have not been
adopted by the Group for the annual reporting period ending 30 June 2019. These are outlined in the following table:
REFERENCETITLEGROUP
APPLICATION
DATE *
SUMMARYIMPACT ON GROUP
NZ IFRS 16NZ IFRS 16:
Leases
1 July 2019NZ IFRS 16 is the new standard on the
recognition, measurement, presentation and
disclosure of leases. The standard will replace
NZ IAS 17: Leases.
The scope of the new standard includes leases
of all assets, with certain exceptions. A lease is
defined as a contract, or part of a contract, that
conveys the right to use an asset (the underlying
asset) for a period of time in exchange for
consideration.
NZ IFRS 16 requires lessees to account for all
leases under a single on-balance sheet model
(subject to certain exemptions) in a similar way
to finance leases under NZ IAS 17: Leases.
Lessees will be required to recognise a liability
to pay rentals with a corresponding asset, and
recognise interest expense and depreciation
separately. Reassessment of certain key
considerations (e.g. lease term, variable rents
based on an index or rate, discount rate) by the
lessee is required upon certain events. Lessor
accounting is substantially the same as lessor
accounting under NZ IAS 17’s dual classification
approach.
The Group has significant operating lease commitments
including long-term land leases, which allow the Group
to access prime viticultural land in Marlborough and the
Hawke’s Bay, which fall under NZ IFRS 16. On transition
to NZ IFRS 16 the Group will adopt the fully retrospective
transition option. The Group will also adopt the low value
asset exemption in respect of it’s barrel leases and these
will continue to be expensed on a straight-line basis over
the lease terms.
As at the transition date of 1 July 2018 the Group will
recognise in the statement of financial position a:
(i) Lease Liability of $88.9 million;
(ii) Right-of-use Asset of $64.3 million;
(iii) Deferred Tax Asset of $6.7 million;
(iv) Increase in capitalised lease costs within Property,
Plant and Equipment of $0.7 million; and
(v) a corresponding adjustment to Retained Earnings of
$17.2 million.
The change will affect the profile of expenses (interest and
depreciation) and the timing of these expenses relative to
the lease payments which are currently recognised. The
adoption of NZ IFRS 16 will reduce reported profit for the
year ended 30 June 2019 by $0.5 million.
1. GENERAL INFORMATION (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
25

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group’s principal financial liabilities comprise bank loans and overdrafts, trade payables and accruals. The main
purpose of these financial liabilities is to raise funding for the Group’s ongoing operations. The Group also has financial
assets such as trade and other receivables and cash which arise directly from its operations.
The Group is counterparty to derivative financial instruments principally being foreign currency forward exchange
contracts and options and interest rate swaps. The purpose of entering into foreign currency forward exchange contracts
and options is to manage currency risk primarily arising from foreign denominated trade receivables. Interest rate swaps
are entered into with the aim of mitigating interest rate risk to movements on floating rate debt facilities.
The main risks arising from the Group’s financial instruments are foreign currency risk, interest rate risk, credit risk and
liquidity risk. Each of the main operational risks are reviewed by the Treasury Management Committee (TMC) and their
recommendations are provided to the Board of Directors. The composition of the TMC includes the Managing Director
(or Alternate), Chief Financial Officer, Corporate Financial Planning Manager and Independent Treasury Advisors. The
Board reviews and agrees policies for managing each of these risks as summarised below. Board approval is required
for any movement outside policy.
FOREIGN CURRENCY RISK
The net assets employed through subsidiary companies based overseas exposes the Group to foreign currency risk as a
result of changes in the GBP/NZD, AUD/NZD, USD/NZD, EUR/NZD, CAD/NZD, SGD/NZD, JPY/NZD and CNY/NZD
exchange rates. The Group also has foreign currency risk resulting from sales of product in a currency which is other
than that of the New Zealand Dollar. Profits from each export region are repatriated and reported in New Zealand
Dollars and the Group is exposed to changes in foreign exchange rates.
To minimise foreign currency risk the Group enters into forward exchange contracts and options for foreign denominated
sales at levels which are considered to be highly probable. The Group attempts to maintain foreign currency cover of
between 75% to 100% of highly probable sales in one to three months, 50% to 75% for highly probable sales in four to
six months, 25% to 50% for highly probable sales in seven to 12 months, 0% to 50% for sales between 13 to 18 months
and 0% to 25% for sales thereafter. The Group has the option of increasing foreign exchange cover to 100% for any time
period upon approval by the Board of Directors.
When the Group is exposed to foreign currency risk as a result of being contractually committed to purchase capital
items from an overseas supplier and such expenditure is expected to exceed $200,000, the Group’s policy is to ensure
the foreign currency exposure is covered in full. Any capital expenditure between $100,000 and $200,000 is to be
covered at the discretion of the TMC, based on such factors as timing for payment and expected volatility of currency
markets. It is the Group’s policy that in no instance is trading for speculative purposes permitted.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
26

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
At 30 June 2019, had the New Zealand Dollar moved as illustrated in the following table with all other variables held
constant, post-tax profit and equity would have been affected as follows:
IMPACT ON 2019 REPORTED IMPACT ON 2018 REPORTED
Post-Tax Equity Post-Tax Equity
Profits Profits
Group $000 $000 $000 $000

NZD/USD +5% 1,870 1,870 1, 50 0 1, 50 0
NZD/USD -5% (2,173) (2,173) (1,855) (1,855)
NZD/GBP +5% 1,297 1,297 1,414 1,414
NZD/GBP -5% (1,353) (1,353) ( 1, 5 74 ) ( 1, 5 74 )
NZD/AUD +5% 55 (1,406) 74 4 ( 7 7 8 )
NZD/AUD -5% (60) 1,554 (904) 778
NZD/CAD +5% 519 519 135 135
NZD/CAD -5% (628) (628) (122) (122)
NZD/EUR +5% (57) (57) (39) (39)
NZD/EUR -5% 63 63 43 43
The table above calculates the impact of a change in foreign exchange rates on closing equity and post-tax profits
of the Group, as a result of the Group being counterparty to transactions which are foreign currency denominated.
Foreign currency denominated balances include trade and other receivables, trade payables and accruals, loans and
borrowings, cash on hand and unsettled foreign exchange contracts that exist at balance sheet date. The net foreign
currency exposure is determined in aggregate and the impact on post-tax profits determined as a result of a +/- 5%
movement in foreign exchange rates. A +5% movement reflects the strengthening of the NZD relative to the other
currency, whereas a -5% movement reflects the weakening of the NZD relative to the other currency.
The impact upon the Group’s equity balance is derived through determining the impact on post-tax profits as noted
above.
Increase/
(decrease)
Increase/
(decrease)
Increase/
(decrease)
Increase/
(decrease)
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
27

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
HEDGE OF NET INVESTMENT IN FOREIGN OPERATION
For hedges of a net investment in a foreign operation, the effective portion of the gain or loss on the hedging
instrument is recognised in the statement of other comprehensive income and accumulated in the foreign
currency translation reserve, while any ineffective portion is recognised immediately in the statement of
financial performance. On disposal of the foreign operation, the cumulative amount of any such gains or
losses accumulated within equity is transferred to the statement of financial performance.
The net assets employed in Barossa Valley Estate Pty Limited (BVE) exposes the Group to foreign currency risk as a result
of changes in the AUD/NZD exchange rate.
The foreign currency movement on translation of the net assets of BVE is included in the statement of other comprehensive
income. Since the acquisition of BVE the Group has maintained a portion of their external borrowings in AUD to
mitigate this risk. The foreign exchange movement on these external borrowings in the absence of hedge accounting, is
included in the statement of financial performance.
External borrowings of A$29,350,000 have been designated as a hedge of the net investment in BVE. Gains or losses on
the retranslation of this borrowing are transferred to the statement of other comprehensive income to offset any gains or
losses on translation of the net assets of BVE. There is no hedge ineffectiveness in the year ended 30 June 2019.
INTEREST RATE RISK
The Group’s exposure to the risk of changes in market interest rates relates primarily to the Group’s long-term and short-
term debt obligations with interest payable based on floating rates of interest. Interest rate risk is monitored by the TMC
on an ongoing basis. The recommendation by the TMC to enter into fixed or variable rate debt facilities and decisions
to retire existing debt instruments is made after consideration of the economic indicators impacting upon the overnight
cash rate, which influences the rates of interest charged by financial institutions. All funding facilities recommended by
the TMC must be approved by the Board of Directors.
The Group manages interest rate risk through maintaining a mix of debt instruments having variable and fixed interest
rates. The Group’s policy is to maintain a level of fixed debt facilities between 40% to 100% of core debt for a period of
one year, between 30% to 80% of projected core debt for periods of one to three years, and 15% to 60% of projected
core debt facilities for three to five years. Board approval is required for any fixed rate cover that extends beyond five
years.
The Group also manages interest rate risk through being counterparty to a series of interest rate swaps. The Group
agrees to settle or has the option to exchange, at specified dates, the difference between fixed and variable rate interest
amounts calculated by reference to an agreed upon notional principal amount. These are discussed in Note 9: Derivative
Financial Instruments.
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
28

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
The table below demonstrates the sensitivity to a reasonably possible change in interest rates, with all other variables
held constant, on the Group’s post-tax profits and equity:
IMPACT ON 2019 REPORTED IMPACT ON 2018 REPORTED
Post-Tax Equity Post-Tax Equity
Profits Profits
Group $000 $000 $000 $000
2.00% Increase – 200 basis points
(2018: 2.00% Increase – 200 basis points) 4,196 4,196 5,225 5,225
0.25% Decrease – 25 basis points
(2018: 0.25% Decrease – 25 basis points) (525) (525) (653) (653)
The key assumptions which impact upon the values presented in the above table are the following:
– Cash and cash equivalents include deposits on call which are at floating interest rates. The estimated impact upon
interest revenues from these sources is based upon amounts held on deposit remaining at consistent levels as reported
at the balance sheet date. For foreign denominated deposits the impact on foreign exchange is based on the conversion
rate existing at balance sheet date.
– Account balances that are trade receivables or trade payables are generally on 30 to 90 day terms and are non-interest
bearing and are not subject to interest rate risk.
– The impact upon the fair value of the interest rate swaps is based upon the differential in rates between the Group
paying a fixed rate of interest and receiving the floating New Zealand Bank Bill Rate (BKBM) multiplied by the nominal
amount under the swap agreement up until maturity.
– Interest payable on bank debt is based upon the BKBM plus a margin. The margin is dependent upon the Group
achieving certain financial covenants and the margin ranges from 1.02% to 1.50%. The analysis assumes that the margin
and principal is held constant at the same rate as at the balance sheet date with the sensitivity calculating the effect on
interest expense of movements in the BKBM rate. The analysis excludes any future interest that would be capitalised as
part of long-term assets.
– Included in the above table is the change in fair value of interest rate swaps which results from changes in the floating
interest rate.
CREDIT RISK
The Group trades with recognised and creditworthy third parties. It is the Group’s policy that all customers who wish
to trade on credit terms are subject to credit verification procedures. Receivable balances are monitored on an ongoing
basis. The maximum exposure to the carrying amount of receivable balances is disclosed in Note 11. The Group does
not have any significant concentrations of credit risk.
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
29

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
LIQUIDITY RISK
Liquidity risk is the risk that an unforeseen event or miscalculation in the required liquidity level may lead to the Group
being unable to meet its day to day funding obligations. To minimise liquidity risk the Group’s policy is to maintain
committed funding facilities at a minimum of 105% of the projected peak debt level over the next 12 months (excluding
the cash requirements for any business combinations).
The table below presents all contractual payments which the Group is legally obliged to make and includes all future
interest payments on interest-bearing facilities. The interest cost has been estimated by maintaining the current principal
balance and interest rates that exist at balance sheet date. The table also includes the New Zealand Dollar equivalent for
the foreign currency amounts, which are to be delivered to fulfil obligations under foreign currency contracts. The table
below excludes amounts required to fund operating lease commitments as these are disclosed in Note 17.
Facility Type
30 June 2019
Facility
Limit
$000
Drawn At
Balance Sheet
Date
$000
< 1 year
$000
1 to 2 years
$000
> 2 years
$000
Working Capital facility 48,000 23,000 652 652 23,705
Term facility (Multi-Currency) 220,000 220,008 6,094 6,094 226,603
Headroom Facility 20,000 – – – –
Term facility (AUD) 41,810 33,971 815 815 34,853
Derivative financial instruments N /A N /A 83,647 3,073 3,249
Trade payables and accruals N/A 31,898 31,898 – –
Financial guarantee contracts N /A N /A 640 – –
As at 30 June 2019 329,810 308,877 123,746 10,634 288,410
Included in the table above are financial guarantees which are valued at their highest possible amount that can be called
at balance date. For each individual guarantee if the obligation at balance date is lower than the maximum amount
callable under the guarantee then the lower value has been included. The guarantees can be called in favour of the
beneficiary if certain acts of non-performance occur. The Directors consider the likelihood of each financial guarantee
being called remote.
A General Security Agreement exists in favour of Westpac New Zealand Limited, Westpac Banking Corporation, Bank
of New Zealand Limited, China Construction Bank (New Zealand) Limited and Hongkong and Shanghai Banking
Corporation Limited to secure amounts loaned to the Group. The General Security Agreement covers the existing and
future assets of Delegat Group Limited, Delegat Limited, Delegat Australia Pty Limited, and Barossa Valley Estate Pty
Limited. The amount of the guarantee in respect of the banking facilities is not included in the above table and is the
lower value of the net assets of the Group and the aggregate of the loans advanced at balance date. Loan facilities are
disclosed in Note 10.
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
30

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
Facility Type
30 June 2018
Facility
Limit
$000
Drawn At
Balance Sheet
Date
$000
< 1 year
$000
1 to 2 years
$000
> 2 years
$000
Working Capital facility 65,000 19,177 579 19,474 –
Term facility (Multi-Currency) 146,000 131,961 3,985 134,003 –
Forward Start Facility 100,000 100,000 3,015 101,545 –
Term facility (AUD) 38,114 34,847 1,058 35,389 –
Derivative financial instruments N/A N/A 86,873 1,613 2,097
Trade payables and accruals N/A 32,166 32,166 – –
Financial guarantee contracts N/A N/A 1,357 – –
As at 30 June 2018 349,114 318,151 129,033 292,024 2,097
All of the above facilities have or had a floating rate of interest which is tied to the New Zealand BKBM for NZD facility/
Australian BBSY for AUD facilities plus margin. At balance sheet date the Group has interest rate swaps that cover
$123,745,000 (2018: $131,680,000) of the principal balance drawn at balance sheet date. Refer to Note 9.
The Group maintains credit facilities at a level sufficient to fund the Group’s working capital during the period between
cash expenditure and cash inflow.
SUMMARY OF FINANCIAL INSTRUMENTS HELD
At the balance sheet date the Group reports the following categories of financial instruments:
2019 2018
$000 $000
Financial Assets
Financial assets at amortised cost 4 4,179 45,501
Financial assets at fair value through profit and loss 1,088 –
45,267 45,501
Financial Liabilities
Financial liabilities at amortised cost 302,577 312,70 0
Financial liabilities at fair value through profit or loss 9,281 6,731
311,858 319,431
The Group does not have any financial assets or liabilities that are classified as fair value through other comprehensive
income (FVOCI).
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
31

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
FAIR VALUE OF FINANCIAL INSTRUMENTS
The fair value of financial instruments is presented in the previous table. For financial instruments measured at fair value
further disclosure is required that allocates the fair values into a measurement hierarchy. The following principles have
been applied in classifying these instruments:
Level 1 – the fair value is calculated using quoted prices in active markets;
Level 2 – the fair value is estimated using inputs other than quoted prices included in Level 1 that are observable for the
asset or liability, either directly (as prices) or indirectly (derived from prices);
Level 3 – the fair value is estimated using inputs for the asset or liability that are not based on observable market data.
The fair value of the financial instruments as well as the methods used to estimate the fair value are summarised in the
table below:
Level 1 Level 2 Level 3 Total
30 June 2019 $000 $000 $000 $000
Financial Assets
Foreign currency forward exchange option contracts – 311 – 311
Foreign currency forward exchange contracts – 777 – 777
– 1,088 – 1,088
Financial Liabilities
Interest rate swap contracts – 9,281 – 9,281
– 9,281 – 9,281

The fair value of financial instruments held at balance date that are not traded on an active market include foreign
currency forward exchange contracts and options and net settled interest rate swap contracts. The fair values are derived
through valuation techniques that 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 come from observable market data the instrument is
included in Level 2 of the hierarchy.
Level 1 Level 2 Level 3 Total
30 June 2018 $000 $000 $000 $000
Financial Liabilities
Foreign currency forward exchange option contracts – 829 – 829
Foreign currency forward exchange contracts – 185 – 185
Interest rate swap contracts – 5,717 – 5,717
– 6,731 – 6,731

2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
32

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
FINANCIAL RISK ASSOCIATED TO BEARER PLANTS
The Group is exposed to financial risks in respect of agricultural activities. The agricultural activities of the Group consist
of the management of vineyards to produce grapes for use in the production of wine. The primary risk borne by the
Group is caused by the length of time between when cash is expended on the purchase or planting and maintenance of
grape vines and on harvesting grapes and the ultimate realisation of proceeds from the sale of finished product (wine).
The Group takes reasonable measures to ensure that the current year’s harvest is not affected by disease, drought,
frost, or other factors that may have a negative effect upon yield and quality. These measures include consultation with
experts in viticulture, frost protection measures, and ensuring that each vineyard is managed according to a specifically
developed Vineyard Management Calendar.
CAPITAL MANAGEMENT
When managing capital, management’s objective is to ensure the entity continues as a going concern as well as to
maintain optimal returns to shareholders and benefits for other stakeholders of the business. The ultimate aim is to
maintain a capital structure which provides flexibility to enable future growth of the Group whilst ensuring the lowest
cost of capital is available to the Group.
Management reviews the capital structure of the Group as a result of changes in market conditions which impact
upon interest and foreign exchange rates and may adjust the capital structure to take advantage of these changes.
Management has no current plans to issue further shares on the market but is intent on growing the business which will
require future funding.
The Group is subject to a series of bank covenants over its Senior Debt facilities. These are discussed in Note 10.
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
33

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
3. SEGMENTAL REPORTING
An operating segment is a reportable segment if the segment engages in business activities in which it may
earn revenues and incur expenses, whose operating results are regularly reviewed by the Group’s Chief
Operating Decision Maker and for which discrete financial information is available.
The Group reviews its operational performance based upon the management and the geographic areas in which their
customers are based. Financial information which is available to management in order to assess segment performance
and investment opportunities is presented on the same basis. In accordance with NZ IFRS 8: Operating Segments this
forms the basis of presentation for Segment Reporting and is the format adopted below:
– Delegat Limited (Delegat) is party to vineyard leases and has interests in freehold land and winery infrastructure which
allows the company to grow, harvest and make finished wine to be marketed, distributed and sold into the Super Premium
wine markets. Delegat sells and markets its product through a combination of subsidiary companies based overseas or
to customers and distributors directly in the New Zealand, Canadian, Asian and Pacific Island markets. Delegat Australia
Pty Limited, Delegat Europe Limited and Delegat USA, Inc. act as distributors and assist in the marketing of product in
their respective geographic regions. Wines are sold all year round to all regions and the Group considers there is no
significant variations in revenues throughout the year.
The Group implements appropriate transfer pricing regimes within the operating segments on an arm’s length basis in a
manner similar to transactions with third parties.
Management monitors the operating results of its business units separately for the purpose of making resource allocations
and performance assessments. Segment performance is evaluated based on operating profit or loss, which may be
measured differently from operating profit or loss in the consolidated financial statements as segment reporting is based
upon internal management reports. The main differences are a result of some deferred tax balances being recognised
upon consolidation not being allocated to individual subsidiaries. Also intercompany stock margin eliminations are
managed on a group basis and are not allocated to operating segments.
R E V E N U E
Revenue is recognised when the Group satisfies it’s performance obligation to the customer. Satisfaction of a
performance obligation occurs when the Group has transferred a promised good to the customer and when
the customer obtains control of that good. The following specific recognition criteria have been applied to
each individual classification of revenue:
(i) Sale of Goods
The primary source of revenue earned by the Group is through providing wine to third party retailers and
distributors. Revenue is recognised when control of the wine has passed to the buyer and the costs incurred
or to be incurred in respect of the transaction can be measured reliably. Control is considered passed to the
buyer at the time of delivery of goods to the customer.
(ii) Interest Revenue
Revenue is recognised as interest accrues using the effective interest rate method. This is a method of
calculating the amortised cost of a financial asset and allocating the interest income over the relevant period
using the effective interest rate, which is the rate that exactly discounts estimated future cash receipts through
the expected life of the financial asset to the net carrying amount of the financial asset.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
34

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
R E V E N U E
Sales are often made with volume discounts, other rebates and various other payments to customers for
promotional support. For volume discounts and other rebates not invoiced at the reporting date these
are estimated based on agreements with customers and estimated depletions during the period. Other
payments to customers for promotional support include listing fees, mailer fees and other incentives. For
these expenses that have not been invoiced at the reporting date these are estimated based on agreements
with customers and estimated achievement of various targets by the customer. At 30 June 2019 the Group
has recognised accruals for all of these expenses of $22.7 million (2018: $23.1 million). The majority of these
amounts will be settled within the six months following balance date.
Year ended
30 June 2019
Delegat
Limited
$000
Delegat
Australia
Pty Ltd
$000
Delegat
Europe
Limited
$000
Delegat
USA, Inc.
$000
Other
Segments
10
$000
Eliminations
and
Adjustments
11
$000
Year Ended
30 June
2019
$000
Operating income
External sales
2,8
61,479 75,069 81,253 123,624 8,717 (72,362) 2 7 7, 7 8 0
Internal sales 247,439 – – – 9,133 (256,572) –
Unrealised foreign
exchange (losses)/gains (44) – 28 – (32) 217 169
Dividend revenue 4 – – – 7 – 11
Interest revenue 7 5 – – 1,481 (1,479) 14
Total segment revenues
1
308,885 75,074 81,281 123,624 19,306 (330,196) 2 7 7, 9 74
Operating expenses
Interest expense
3
12,256 – – – 1,248 (1,479) 12,025
Depreciation
4
13,617 124 19 64 1,757 – 15,581
Income tax expense
5
16,433 685 699 650 511 (380) 18,598
Segment profit/(loss) 40,771 1,572 2,958 1,822 1,213 (976) 4 7, 3 6 0
Assets
Segment assets
6
680,360 18,032 17,355 30,900 102,371 (114,887) 734,131
Capital expenditure
7
30,420 26 2 64 2,355 – 32,867
Segment liabilities 357,940 3,848 10,287 18,344 39,173 (69,945) 359,647
Refer to footnotes on page 50
3. SEGMENTAL REPORTING (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
35

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
3. SEGMENTAL REPORTING (CONTINUED)
Year ended
30 June 2018
Restated*
Delegat
Limited
$000
Delegat
Australia
Pty Ltd
$000
Delegat
Europe
Limited
$000
Delegat
USA, Inc.
$000
Other
Segments
10
$000
Eliminations
and
Adjustments
11
$000
Year Ended
30 June
2018
$000
Operating income
External sales
2,9
65,659 78,405 66,525 104,928 6,720 (67,140) 255,097
Internal sales 214,487 – – – 12,984 (227,471) –
Unrealised foreign
exchange gains/(losses) 846 – (4) – 26 (281) 587
Dividend revenue 7,873 – – – 5 (7,869) 9
Interest revenue 2 4 – – 3,591 (3,528) 69
Total segment revenues
1
288,867 78,409 66,521 104,928 23,326 (306,289) 255,762
Operating expenses
Interest expense
3
14,366 – – – 1,119 (3,528) 11,957
Depreciation
4
13,270 134 22 61 1,602 – 15,089
Income tax expense
5
15,436 715 555 735 1,264 (379) 18,326
Segment profit/(loss) 46,941 1,642 2,471 1,355 3,271 (8,844) 46,836
Assets
Segment assets
6
650,666 18,528 14,111 29,446 119,451 (123,348) 708,854
Capital expenditure
7
44,466 6 – – 2,733 – 47,205
Segment liabilities 369,939 5,358 9,848 18,815 41,086 (79,381) 365,665
1.
Intersegment revenues are eliminated on consolidation. Intercompany profit margins are also eliminated.
2.
External sales revenue includes various payments to customers for volume discounts, rebates and other promotional support. For volume discounts,
rebates and other promotional support not invoiced at 30 June 2018 the Group recognised accruals of $23,137,000 (30 June 2017: $19,307,000).
During the year ended 30 June 2019 $2,732,000 of these accruals have been released (June 2018: $3,207,000).
3.
Interest expense is net of any interest capitalised to long-term assets. During the year $1,851,000 was capitalised to long-term assets (2018:
$1,692,000).
4.
Depreciation expense presented above is gross of $14,058,000 (2018: $13,683,000), which has been included within inventory.
5.
Segment income tax expense does not include the deferred tax impacts of temporary differences arising from intercompany stock margin eliminations
or fair value adjustments resulting from the purchase of subsidiary companies as these are managed on a group level.
6.
Segment assets include the value of investments and loan balances for subsidiaries which reside in Delegat Limited however do not include the
effects of stock margin eliminations for stock on hand in subsidiaries.
7.
Capital expenditure consists of additions of property, plant and equipment inclusive of capitalised interest. Capital expenditure is included within
each of the reported segment assets noted above.
8.
During the 2019 financial year Delegat USA, Inc had a single customer which comprised 10% or more of group sales amounting to $61,267,000 and
Delegat Australia Pty Limited had a single customer which comprised 10% or more of Group sales amounting to $30,539,000.
9.
During the 2018 financial year Delegat USA, Inc had a single customer which comprised 10% or more of group sales amounting to $47,034,000 and
Delegat Australia Pty Limited had a single customer which comprised 10% or more of Group sales amounting to $30,670,000.
10.
Other segments’ assets include non-current assets of Barossa Valley Estate Pty Limited of $48,465,000 (2018: $49,943,000) which are located in
Australia.
11.
The eliminations and adjustments of segment profit, assets and liabilities relate to intercompany transactions and balances which are eliminated on
consolidation.
* The financial statements for the year ended 30 June 2018 have been restated following the adoption of NZ IFRS 15: Revenue from Contracts with Customers on 1 July 2018. Refer to Note 1 of
the financial statements.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
36

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
4. EXPENSES
Expenses by function have been categorised as follows:
Note 2019 2018
$000 $000
Restated*
Cost of sales 143,102 119,960
Selling, marketing and promotion expenses 40,898 42,673
Corporate governance expenses 867 934
Administration expenses 13,662 12,153
Fair value loss on financial derivative instruments 1,462 2,923
Specific components of the above expenses include:
Directors’ fees – Delegat Group Limited 293 280
Directors’ fees – Overseas subsidiaries 47 59
Depreciation
1
13 15,581 15,089
Wages and salaries
2
42,084 39,872
Defined contribution pension plans
2
1,519 1,435
Termination benefits paid
2
53 109
Vineyard related lease payments 7, 3 1 0 7, 0 7 8
Other lease payments 8,845 8,168
Auditor Remuneration
3,4

Assurance services
Audit of the financial statements 205 200
Non-assurance services
Tax compliance 45 38
Total remuneration 250 238
1.
The depreciation figure presented above represents the gross depreciation charge for the year. Depreciation is recorded in the business function to
which the asset relates. Depreciation incurred on assets directly associated with winemaking and viticulture of $14,058,000 (2018: $13,683,000) is
included within the cost of inventories and expensed as a cost of sales when product is sold.

Depreciation on vineyard development commences when the vineyard is considered to be in commercial production, which is generally when the
vineyard has produced approximately 60% of the expected yield at full production.
2.
The employee benefit figures above represent the gross employee benefits expense for the year. Included within inventory is remuneration paid to
employees directly associated with winemaking, bottling and packaging. During the year $9,027,000 (2018: $7,914,000) of employee benefits were
included within inventory. These costs are included within inventory until the stock to which the expenditure relates is sold.
3.
The auditor of Delegat Group Limited is Ernst & Young. Amounts received, or due and receivable, by Ernst & Young are as disclosed above.
4.
During the year the Group also paid $4,000 (2018: $4,000) to SBA Stone Forest CPA Co. Limited for the audit of the local financial statements of
Delegat (Shanghai) Trading Co. Limited.
* The financial statements for the year ended 30 June 2018 have been restated following the adoption of NZ IFRS 15: Revenue from Contracts with Customers on 1 July 2018. Refer to Note 1 of
the financial statements.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
37

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
5. EARNINGS PER SHARE
Basic earnings per share is calculated as Group profit after income tax attributable to ordinary shareholders
of the Parent, adjusted to exclude any costs of servicing equity (other than dividends) and preference share
dividends, divided by the weighted average number of ordinary shares on issue.
Diluted earnings per share is calculated as Group profit after income tax attributable to ordinary shareholders
of the Parent adjusted for:
– costs of servicing equity (other than dividends) and preference share dividends;
– the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have
been recognised as expenses;
– other non-discretionary changes in revenues and expenses during the period that would result from the
dilution of potential ordinary shares;
divided by the weighted average number of ordinary shares and dilutive potential ordinary shares.
The following reflects the earnings used in the calculation of the basic and fully diluted earnings per share.
2019 2018
a) Earnings Used in Calculating Earnings per Share
Profit for the year – basic and fully diluted ($000) 4 7, 3 6 0 46,836
b) Weighted Average Number of Shares
Weighted average number of shares – basic and fully diluted (000’s) 101,130 101,13 0
c) Reported Earnings Per Share on statement
of financial performance (expressed as cents per share)
– Basic and fully diluted earnings per share 46.83 46.31
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
38

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
6. SHARE CAPITAL
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or
options are shown in equity as a deduction from the proceeds.
2019 2018
$000 $000
Balance at the beginning of the year 49,815 49,815
Balance at the end of the year 49,815 49,815

a) Movement in the Number of Ordinary Shares on Issue Shares Held
000s 000s
Balance at the beginning of the year 101,130 101,13 0
Balance at the end of the year 101,130 101,13 0
All ordinary shares have equal voting rights and share equally in dividends and surplus on winding up.
b) Nature and Purpose of Reserves
Foreign Currency Translation Reserve
The foreign currency translation reserve is used to record exchange differences arising from the translation of the
financial statements of foreign subsidiaries. During the year equity decreased by $1,812,000 upon the translation of
foreign subsidiaries (2018: $3,238,000 increase).
7. DIVIDENDS PAID AND PROPOSED
a) Recognised Amounts
Dividends that were declared and paid on ordinary shares during the year amounted to $15,177,000 (2018: $13,153,000)
equating to 15.0 cents per share (2018: 13.0 cents per share).
b) Unrecognised Amounts
After the balance sheet date, dividends of 17.0 cents per share were approved by the Board of Directors. These amounts
are not recognised in these financial statements as the declaration date was subsequent to year-end.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
39

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
8. TRADE PAYABLES AND ACCRUALS
Trade payables are initially recognised at fair value and then carried at amortised cost, and due to their short-
term nature, they are not discounted. They represent liabilities for goods and services provided to the Group
prior to the end of the financial year that are unpaid and arise when the Group becomes obliged to make
future payments in respect of the purchase of these goods and services.
Provisions are recognised when the Group has a present obligation as a result of a past event and it is
probable that an outflow of economic resources embodying economic benefits will be required to settle the
obligation and a reliable estimate can be made of the amount of the obligation.
Provisions are measured as the present value of management’s best estimate of the expenditure required to
settle the present value of the obligation at the balance sheet date. If the effect of the time value of money
is material, provisions are discounted using a pre-tax rate that reflects the time value of money and the risks
specific to the liability. The increase in the provision resulting from the passage of time is recognised as a
finance cost.
Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulated sick leave
expected to be settled within 12 months of the reporting date are recognised in respect of the employee’s
services up to the reporting date. They are measured as 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 is measured
at the rates paid or payable.
The Group makes regular contributions to various defined contribution pension plans. Included within the
statement of financial performance are amounts paid and payable by the Group into these pension plans,
net of any related tax rebates. The Group does not make available or make contributions to any defined
benefit superannuation plans.
2019 2018
$000 $000
Trade payables 16,956 1 7, 8 4 1
Employee entitlements and leave benefits 5,310 5,220
Goods and services tax 446 775
Accrued expenses 9,632 9,105
32,344 32,941
Trade payables are unsecured, non-interest bearing and are generally settled on 30 to 60 day terms. The carrying
amount disclosed above is a reasonable approximation of fair value.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
40

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
9. DERIVATIVE FINANCIAL INSTRUMENTS
The Group uses derivative financial instruments such as forward currency contracts and options to
economically hedge its risks associated with foreign currency fluctuations and interest rate swaps to manage
interest rate risk. Such derivative financial instruments are initially recognised at fair value on the date on
which a derivative contract is entered into, and are subsequently remeasured to fair value at balance date.
Any gains or losses arising from changes in the fair value of derivatives are taken directly to the statement of
financial performance. The fair value of forward exchange contracts and options is determined by reference
to current forward exchange rates for contracts with similar maturity profiles. The fair value of interest rate
swaps is determined by reference to market values for similar instruments.
The Group’s derivative financial instruments are classified as level 2 in the fair value hierarchy, as they have
inputs other than observable quoted prices. In calculating the mark-to-market values, management has
considered the forward rates.
The Group has the following derivative financial instruments outstanding at the balance sheet date.
a) Foreign Currency Forward Exchange Contracts and Options
i) Forward Exchange Contracts
AVERAGE CONTRACTED RATE NOTIONAL VALUE
2019 2018 2019 2018
Selling Currency/Buying NZD $000 $000
Sell AUD, maturity 1 month 0.9106 0.917 7 1,647 9,970
Sell USD, maturity 0 – 3 months 0.6635 0.6894 13,619 9,213
Sell GBP, maturity 1 – 12 months 0.5099 0.5147 19,122 1 7, 6 0 4
Sell CAD, maturity 0 – 6 months 0.8840 0.8985 11,457 5,845
Sell SGD, maturity 1 – 2 months 0.9034 0.9294 205 215
Sell JPY, maturity 1 – 6 months 71.9095 74.0000 107 67
Sell HKD, maturity 1 – 3 months 5.2424 5.3724 739 372
Buying Currency/Selling NZD

Buy EUR, maturity 0–2 months 0.5928 0.5924 1,142 481
Buy AUD, maturity 1 month 0.9513 – 752 –
The fair value of forward exchange contracts is determined by comparing the market rates for contracts with the same
nominal amount, exercise price and length of time to maturity.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
41

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
ii) Forward Currency Options
AVERAGE CONTRACTED RATE NOTIONAL VALUE
2019 2018 2019 2018
Selling Currency / Buying NZD $000 $000
Sell USD, maturity 1 –12 months 0.6666 0.7014 24,009 18,542
Sell GBP, maturity 1 –12 months 0.5171 0.5165 9,191 12, 587
Sell AUD – 0.9170 – 5,453
Sell CAD, maturity 3 –11 months 0.8852 0.9018 3,672 4,715
NZ IFRS 9: Financial Instruments requires that derivative financial instruments are classified as fair value
through profit or loss for measurement purposes unless they are accounted for as hedges. Under NZ IAS
1: Presentation of Financial Statements, assets and liabilities under the fair value through profit or loss
classification would generally be classified as current in the statement of financial position. However if the
intent is not to actually trade the derivative financial instruments with maturities greater than 1 year but to
hold them until maturity, then the derivative financial instruments are more appropriately classified as non-
current. The amounts that are classified as non-current reflect the amounts that will not be settled in the
next 12 months.
The classification of forward exchange contracts and forward currency options between current and non-current is
based on whether the contracts will be settled in the next 12 months. The fair value of open contracts existing at balance
sheet date are classified as follows:
2019 2018
Assets Liabilities Assets Liabilities
$000 $000 $000 $000
Current:
Forward Exchange Contracts 777 – – 185
Foreign Currency Options 311 – – 829
1,088 – – 1,014
9. DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
42

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
b) Interest Rate Swaps
In order to protect against risks relating to increases in interest rates, the Group has entered into interest rate swap
contracts under which the Group receives interest at variable rates and has agreed to pay interest at fixed rates for
varying terms of principal and time durations.
At balance sheet date interest rate contracts are in place that cover a total $95,000,000 (2018: $105,000,000) of current
New Zealand dollar denominated Group debt through 12 separate cap rate agreements, which range in maturity from
zero to five years, with a weighted average interest rate cap of 4.05% plus bank margin (2018: 3.82% plus bank margin).
In addition, interest rate contracts are in place that cover a total A$27,500,000 (2018: A$24,500,000) of current Australian
dollar denominated Group debt through six separate cap rate agreements, which range in maturity from three to five
years, with a weighted average interest rate cap of 2.92% plus bank margin (2018: 3.74% plus bank margin).
At balance sheet date the Group has a further four separate cap rate agreements that cover a total of $40,000,000 (2018:
$70,000,000) which apply from various future dates to cover future Group indebtedness. These range in maturity from
two to six years, with interest rate caps ranging between 2.1% and 3.71% plus bank margin (2018: 3.05% to 4.90% plus
bank margin). A further two cap rate agreements are in place that cover a total of A$10,000,000 (2018: A$15,000,000)
which apply from various future dates, ranging in maturity from four to six years, with interest rate caps ranging between
1.87% and 1.98% plus bank margin (2018: 1.95% and 2.37% plus bank margin). The application date of these New
Zealand dollar and Australian dollar denominated future cap rate agreements range between August 2019 and July 2020.
The total fair value of these contracts at balance sheet date is a liability of $9,281,000 (2018: $5,717,000 liability).
The Group has elected not to apply hedge accounting to its derivative financial instruments and accordingly
the instruments have been classified as fair value through profit and loss.
The classification between current and non-current is based on whether the contracts or portion of contracts will be
settled within the next 12 months. The total fair value of these contracts at balance sheet date are classified as follows:
2019 2018
Assets Liabilities Assets Liabilities
$000 $000 $000 $000
Current:
Interest Rate Swaps – 2,960 – 2,006
– 2,960 – 2,006

Non-current:
Interest Rate Swaps – 6,321 – 3,7 11
– 6,321 – 3,7 11
9. DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
43

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
10. INTEREST-BEARING LOANS AND BORROWINGS
a) Debt Facilities Existing at Balance Sheet Date
Loans and borrowings are initially recognised at the fair value of the consideration received less directly
attributable transaction costs. After initial recognition, interest-bearing loans and borrowings are subsequently
measured at amortised cost using the effective interest method. Fees paid on the establishment of loan
facilities that are yield related are included as part of the carrying amount of the loans and borrowings.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement
of the liability for at least 12 months after balance sheet date.
Borrowing costs are expensed as incurred except when they are directly attributable to the acquisition or
construction of a qualifying asset. When this is the case, they are capitalised as part of that asset. Once the
asset is put into productive use, capitalisation of the borrowing costs ceases.
At the balance sheet date the following debt facilities have been drawn upon by the Group.
MaturityEffective Interest Rate2019
$000
2018
$000
20192018
Non-Current Debt Obligations
Term facility (Multi-Currency) 3 January 2020N /A3.88% – 131,853
Forward Start facility 3 January 2020N /A4.27% – 99,94 0
Term facility (AUD) 3 January 2020N /A3.04% – 34,823
Working capital facility 3 January 2020N /A3.02% – 19,138
Term facility (Multi-Currency)30 July 20224.00%N /A 219,347 –
Term facility (AUD)30 July 20222.40%N /A 33,846 –
Working capital facility30 July 20222.83%N /A 22,856 –
Headroom facility30 July 2022N /AN /A (60)–
275,989 285,754
The carrying amount of the Group’s non-current borrowings are the fair values at balance sheet date.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
44

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
b) Terms and Conditions of Debt Facilities
i) Senior Debt Facilities
On 28 June 2019 the Group successfully completed the renegotiation of its syndicated Senior Debt facilities. The
Group now has a syndicated Senior Debt facilities agreement with Westpac New Zealand Limited, Westpac Banking
Corporation, Bank of New Zealand Limited (BNZ), China Construction Bank (New Zealand) Limited (CCB) and Hongkong
and Shanghai Banking Corporation Limited (HSBC). The total syndicated Senior Debt facilities of $330 million have
been extended through to 30 July 2022. The existing syndicated Senior Debt facilities were repaid on 28 June 2019.
With the syndicated facility a General Security Agreement remains in place in favour of the banks over the existing and
future assets of Delegat Group Limited, Delegat Limited, Delegat Australia Pty Limited and Barossa Valley Estate Pty
Limited.
At balance sheet date the Working Capital, Term facility (Multi-Currency), Term facility (AUD), and Headroom facility
collectively make up the syndicated Senior Debt Facilities of Delegat, which provide funding for the assets of the Group.
The maximum limit of the Working Capital facility is NZ$48,000,000 (2018: NZ$65,000,000), the Term facility (Multi-
Currency) is NZ$220,000,000 (2018: NZ$146,000,000), Term facility (AUD) is A$40,000,000 (2018: A$35,000,000),
and Headroom facility is NZ$20,000,000 (2018: Forward Start facility NZ$100,000,000). At balance sheet date
NZ$52,832,000 (2018: $63,129,000) is available for further drawdown on these facilities.
The Term facility (AUD) and a portion of the Term facility (Multi-Currency) are denominated in Australian dollars (A$).
The amount drawn down in foreign currency at the balance sheet date was A$61,850,000 (2018: A$61,350,000).
Interest on these facilities is based on the BKBM/BBSY plus margin. The facility agreement requires that certain banking
covenants be met and requires the Group to maintain or better specified EBITDA and fixed charges coverage ratios, and
maintain or better a minimum adjusted equity balance. The Group must also maintain or better a specified total tangible
asset backing. At year-end, and at measurement dates during the year, the covenants of the Senior Debt Facilities have
been met.
ii) Other Facilities
Delegat also has available an overdraft limit of $1,000,000 (2018: $1,000,000). Interest charged on this facility is at the
commercial lending rate (2018: commercial lending rate). At 30 June 2019 the commercial lending rate is 5.85% (2018:
commercial lending rate 5.85%). No amount is drawn against this facility at balance sheet date.
10. INTEREST-BEARING LOANS AND BORROWINGS (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
45

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
11. TRADE AND OTHER RECEIVABLES
On initial recognition, the Group’s trade receivables are recognised at their transaction price as defined in
NZ IFRS 15: Revenue from Contracts with Customers. The Group’s trade receivable balances are generally
short-term and do not contain a significant financing component. They are subsequently measured at
amortised cost using the effective interest method, less an allowance for expected future credit losses.
The Group applies the simplified approach to measuring expected credit losses which uses a lifetime
expected loss allowance for all trade receivables. Expected credit losses are measured by grouping trade
receivables based on shared credit risk characteristics and the days past due. A provision matrix is then
determined based on the historic credit loss rates for each group of customers, adjusted for any material
expected changes to the future risk for that customer group.
Individual trade receivable balances which are known to be uncollectible are written off where the Group
has no reasonable expectation of recovering the trade receivable balance.
2019 2018
$000 $000

Trade receivables 35,486 38,122
Prepayments and sundry receivables 3,046 3,115
Non-trade receivables – –
Goods and services tax 1,482 1,398
40,014 42,635
As at 30 June 2019 the ageing of trade receivables is as follows:
Ageing of receivables
New Zealand
(including
Asia Pacific)
AustraliaUnited
Kingdom
United States
of America
CanadaGroup
As at 30 June 2019 $000 $000 $000 $000 $000 $000
Current 2,012 13,629 11,266 3,912 4,227 35,046
1 to 30 days – 3 – 302 67 372
31 to 60 days 1 – – – 27 28
61 to 90 days – – – 1 39 40
Greater than 90 days – – – – – –
Total trade receivables 2,013 13,632 11,266 4,215 4,360 35,486
All amounts recognised as trade receivables are unsecured and the maximum credit risk is equivalent to the carrying
values noted directly above. Trade receivables are non-interest bearing and generally settled on 30 to 90 day terms. Due
to their short-term nature trade receivables are not discounted.
In determining the historic loss rates to be applied to these customer groups and ageing buckets the Group has reviewed
whether there were any bad debts written off over the last five years and has identified that these were $nil (2018: $nil).
Accordingly the historic loss rates applied to each customer group at 30 June 2019 are 0% (2018: 0%).
Due to the short term nature of the Group’s trade receivables, the nature of the Group’s customer base and the Group’s
experience over the last five years, the historic loss rates have not been adjusted for any material expected future changes
in credit risk.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
46

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
12. INVENTORIES
Inventories are valued at the lower of cost and net realisable value. Net realisable value is the estimated
selling price in the ordinary course of business, less estimated costs of completion and the estimated costs
necessary to make the sale. Costs of finished goods sold are assigned on a weighted average cost basis.
GRAPES
Included within the cost of inventory is the fair value of the grapes (agricultural produce) at the time the
grapes are harvested. At the point of harvest, the harvested grapes qualify as agricultural produce under NZ
IAS 41: Agriculture and are recorded at fair value at that date. The fair value becomes the basis of cost when
accounting for inventories.
Growing Costs
i) Growing Costs where the Group maintains a Beneficial Ownership in Vine Stock
Harvesting of the grape crop is ordinarily performed in late March or early April. Costs incurred in growing
the grapes, including any applicable harvest costs, are initially allocated into the cost of inventory as part of
the total costs to acquire and grow the agricultural produce. At the point of harvest, a fair value adjustment
is made so that the cost per tonne is adjusted to fair value in accordance with NZ IAS 41: Agriculture and
NZ IFRS 13: Fair Value Measurement. Any difference between cost and fair value is included within the
statement of financial performance as cost of sales.
ii) Growing Costs where the Group is not the Beneficial Owner of Vine Stock
The Group is party to long-term vineyard operating lease contracts where the Group is able to access,
harvest and grow agricultural produce, however does not maintain the beneficial ownership in the underlying
bearer plant. Vineyard costs that are incurred subsequent to harvest up to balance sheet date do not qualify
as agricultural produce under NZ IAS 41: Agriculture and are accounted under NZ IAS 2: Inventories, as
inventories. Where growing costs are incurred and the Group is not the beneficial owner of the bearer
plants, growing costs are reported at the lower of cost and net realisable value in accordance with NZ IAS
2: Inventories.
At the point of harvest, management labour and vineyard lease costs have been separately identified from
the pool of growing costs and do not form part of the difference between cost and fair value. These costs are
expensed to the statement of financial performance as cost of sales.
The fair value of grapes at the point of harvest is determined by reference to the market prices for each variety
of grape grown in the local area and the market price paid to independent grape growers. Any difference
between cost and fair value is included within the statement of financial performance as cost of sales.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
47

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2019 2018
$000 $000

Current vintage 80,501 85,050
Aged wine 6 7, 3 4 8 52,418
Growing costs relating to next harvest 4,280 4,614
Winery ingredients, packaging materials and other 5,729 5,349
1 5 7, 8 5 8 1 4 7, 4 3 1
During the year the Group harvested a total of 35,500 tonnes of grapes (2018: 40,059 tonnes) in New Zealand and
Australia. Of this amount a total of 10,686 tonnes (2018: 12,289 tonnes) were purchased from independent third party
growers. The fair value of agricultural produce from the Group’s owned and leased vineyards at the point of harvest was
$47,339,000 (2018: $51,264,000). A fair value gain of $14,019,000 (2018: $21,745,000) was recorded during the year
and included within cost of sales. Included within cost of sales is a total of $157,121,000 (2018: $141,705,000) which
represents costs expended in grape growing (inclusive of lease costs), procurement, delivery and materials.
12. INVENTORIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
48

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
13. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment is stated at historical cost less accumulated depreciation and any accumulated
impairment losses. Such costs include the cost of replacing parts that are eligible for capitalisation when the
cost of replacing the parts is incurred. The cost of purchased property, plant and equipment is the value of
the consideration given to acquire the assets and the value of other directly attributable costs, which have
been incurred in bringing the assets to the location and condition necessary for their intended service.
The cost of self-constructed assets includes the cost of all materials used in the construction, direct labour
on the project, operating lease and financing costs that are directly attributable to the project and an
appropriate proportion of variable and fixed overheads. Costs cease to be capitalised when the asset is ready
for productive use. In respect of vineyard improvements, capitalisation of costs continue until the vineyards
are ready for productive use, which is when the vineyard has produced approximately 60% of expected
yield at full production, ordinarily a period of three years after the planting of vines.
Land and Land Improvement assets are measured at cost and are not subject to depreciation.
IMPAIRMENT
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. If an impairment trigger exists the recoverable amount of the asset is
determined, being the higher of an asset’s fair value, less costs to sell, and value in use. An impairment
charge is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount.
For the purposes of assessing impairment, assets are valued at the lowest levels for which there are separately
identifiable cash flows (cash-generating units).
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
49

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
DEPRECIATION
Depreciation of property, plant and equipment, other than land which has an indefinite economic life
and hence not depreciated, is charged on a straight-line basis so as to write off the assets to their expected
residual value over their estimated useful lives. The estimated useful lives are as follows:
Buildings 10–50 years
Plant and Equipment 3–50 years
Vineyard Improvements 3–50 years
Bearer Plants 50 years
The estimation of the useful lives of assets has been based on historical experience as well as lease terms.
The condition of the assets are assessed at least once per year and considered against the remaining useful
life. Adjustments to useful lives are made when considered necessary.
Depreciation on vineyard improvements commences when the vineyard is considered to be in commercial
production, which is when the vineyard has produced approximately 60% of the expected yield at full
production, ordinarily a period of three years after the planting of vines. The assets’ residual values, useful
lives and depreciation methods are reviewed, and adjusted if appropriate at the end of each financial year.
Capitalised assets on leased vineyards or office premises are depreciated over the shorter of the estimated
useful life of the asset and the remaining lease term.
IMPAIRMENT
The Group assesses impairment of all assets at each reporting date by evaluating conditions specific to the
Group and to the particular asset that may lead to impairment. If an impairment trigger exists the recoverable
amount of the asset is determined. Management considers there are no indicators of impairment in the
current year and the recoverable amount of the Group’s assets was not required to be determined.
a) Reconciliation of Carrying Amounts at the Beginning and End of the Year
Year ended 30 June 2019
Freehold Land
and Land
Improvements
Vineyard
Improvements
Bearer PlantsBuildingsPlant and
Equipment
Capital Work in
Progress
Total
$000 $000 $000 $000 $000 $000 $000
Net book value at 1 July 2018 126,911 71,084 45,458 109,286 125,172 31,950 509,861
Additions / Transfers (325) 9,613 87 5,653 17,708 (340) 32,396
Disposals – – – (17) (256) – (273)
Foreign currency translation (289) (624) (122) (390) (330) (74) (1,829)
Depreciation charge – (3,007) (1,218) (2,664) (8,692) – (15,581)
Net book value at 30 June 2019 126,297 77,066 44,205 111,868 133,602 31,536 524, 574

At cost 126,304 116,317 57,152 129,153 226,665 31,536 6 8 7, 1 2 7
Accumulated depreciation and
impairment (7) (39,251) (12,947) (17,285) (93,063) – (162,553)
Net book value at 30 June 2019 126,297 77,066 44,205 111,868 133,602 31,536 524, 574
13. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
50

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
a) Reconciliation of Carrying Amounts at the Beginning and End of the Year (continued)
Year ended 30 June 2018
Freehold Land
and Land
Improvements
Vineyard
Improvements
Bearer PlantsBuildingsPlant and
Equipment
Capital Work in
Progress
Total
$000 $000 $000 $000 $000 $000 $000
Net book value at 1 July 2017 116,501 64,615 45,833 100,172 118,181 33,373 478,675
Additions / Transfers 11,535 8,876 726 11,444 15,678 (1,548) 46,711
Disposals (1,375) (74) – (173) (425) – (2,047)
Foreign currency translation 250 470 97 313 356 125 1,611
Depreciation charge – (2,803) (1,198) (2,470) (8,618) – (15,089)
Net book value at 30 June 2018 126,911 71,084 45,458 109,286 125,172 31,950 509,861

At cost 126,918 107,361 57,195 123,945 210,478 31,950 657,847
Accumulated depreciation and
impairment (7) (36,277) (11,737) (14,659) (85,306) – (147,986)
Net book value at 30 June 2018 126,911 71,084 45,458 109,286 125,172 31,950 509,861
b) Other Items
During the year no assets were transferred and classified as assets available for sale. The weighted average interest rate
on interest capitalised during the year was 4.81%.
Bearer Plants consist of grape vines on our vineyards located in New Zealand and the Barossa Valley, Australia. At 30
June 2019 the Group has grape vines planted on 1,451 productive hectares of land (2018: 1,440 productive hectares) in
New Zealand and 183 productive hectares (2018: 173 productive hectares) in Australia.
The net book value of vines on leased land where the Group does not have the beneficial ownership in the vine asset,
is not reported above, as the risks and rewards incidental to owning the vines do not transfer to the Group. The Group
is however party to leases of land on which vine stock is owned by the Group. The net book value of these assets are
reported, as the risk and rewards incidental to ownership are retained by the Group.

13. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
51

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
14. INTANGIBLE ASSETS
Intangible assets acquired separately are measured on initial recognition at cost. The cost of the intangible
assets acquired in a business combination is their fair value at the date of acquisition. Following initial
recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated
impairment losses.
The useful lives of intangible assets are assessed as either finite or indefinite. Intangible assets with finite
lives are amortised over their useful life and assessed for impairment whenever there is an indication that
the intangible asset may be impaired. Intangible assets with indefinite useful lives are not amortised, but are
tested for impairment annually, either individually or at the cash-generating unit (CGU) level. The assessment
of indefinite life is reviewed annually to determine whether the indefinite life continues to be supportable. If
not, the change in useful life from indefinite to finite is made on a prospective basis.
Intangible assets currently owned by the Group have been assessed as having indefinite useful lives and
are therefore tested annually for impairment at the cash-generating unit level. The recoverable amount of
the CGU’s assets are higher than the assets’ carrying value and therefore no impairment is required to be
recognised.
Intangible assets currently owned by the Group consist of water rights in both New Zealand and Australia.
Barossa Valley Estate Pty Limited (BVE) owns water rights consisting of shares in Barossa Infrastructure Limited and
associated infrastructure levies. These water rights grant BVE the right to a fixed number of units of water per share and
were purchased by BVE to support their vineyard activities. BVE continues to have the right to use the water over an
indefinite period and therefore the water rights are considered to have an indefinite useful life.
Delegat Limited (Delegat) owns water rights consisting of shares in Lower Waihopai Dam Limited. These water rights
grant Delegat the right to a fixed number of units of water per share and were purchased by Delegat to support their
vineyard activities. Delegat continues to have the right to use the water over an indefinite period and therefore the water
rights are considered to have an indefinite useful life.
The movement in the value of intangible assets is summarised as follows:
2019 2018
$000 $000
Carrying value at the beginning of the year 4,663 4,068
Purchases of intangible assets 471 494
Disposal of intangible assets (10) (26)
Foreign currency translation ( 174) 127
Carrying value at the end of the year 4,950 4,663
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
52

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
15. INCOME TAX EXPENSE
Current tax assets and liabilities for the current and prior periods are measured as the amount expected to
be recovered from, or paid to, the taxation authorities based on the current period’s taxable income. The
tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at
the balance sheet date.
Deferred income tax is provided for all temporary differences at the balance sheet date between the tax
bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred income
tax assets are recognised for all deductible temporary differences, carry-forward of unused tax credits and
unused tax losses, to the extent that it is probable that taxable profit will be available against which the
deductible temporary differences and the carry-forward of unused tax credits and unused tax losses can
be utilised. The carrying amount of deferred income tax assets is reviewed at each balance sheet date and
reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all,
or part of, the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the
year when the asset is realised or the liability is settled, based on the tax rates and tax laws that have been
enacted or substantively enacted at the balance sheet date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in the statement
of financial performance.
Deferred tax assets and liabilities are offset only if a legally enforceable right exists to set off current tax assets
against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and
the same taxation authority.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
53

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2019 2018
$000 $000
a) Numerical Reconciliation between aggregate tax expense
in the statement of financial performance and tax expense
calculated per the statutory income tax rate
Accounting profit before tax 65,958 65,162
At the Group’s statutory income tax rate of 28% (2018: 28%) 18,468 18,245
Tax impact of following items:
Adjustments in respect of income tax of prior years (75) (293)
Entertainment 190 168
Legal fees 52 23
Non-assessable income (28) (37)
Non-deductible depreciation on buildings acquired post May 2010 387 350
Non-deductible items – 2
Tax on foreign income due to different tax rates (396) (132)
Income tax expense for the year 18,598 18,326
b) The major components of income tax expense are:
Income tax reported in the statement of financial performance
Estimated current period tax assessment 1 7, 74 1 15,834
Adjustments in respect of income tax of prior years (996) ( 174 )
Movements in the deferred income tax liability 1,853 2,666
Income tax expense for the year 18,598 18,326
Income tax reported in the statement of other comprehensive income
Net (gain)/loss on hedge of net investment (359) 311
Income tax charged to other comprehensive income (359) 311
15. INCOME TAX EXPENSE (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
54

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2019 2018
$000 $000
c) Deferred income tax at balance sheet date relates to the following:
Capitalised interest 4,864 4,497
Capitalised leases 409 469
Accelerated depreciation of long-term assets 18,184 14,572
Fair value adjustments on biological produce 8,105 9,454
Excess of fair value on acquisition of bearer plants over tax values 8,682 8,682
Provisions (803) (799)
Stock profit and intercompany eliminations (1,352) (973)
Tax losses carried forward (207) (263)
Financial derivative instruments (2,294) (1,885)
Net deferred tax liability 35,588 33,754

Balance at the beginning of the year 33,754 31,124
On surplus for year 1,853 2,666
Foreign currency translation (19) (36)
Balance at the end of the year 35,588 33,754
There are no elements of deferred taxes which are reported within equity.
16. IMPUTATION CREDIT ACCOUNT
2019 2018
$000 $000
Balance at the beginning of the year 62,965 54,823
Tax payments 14,942 13,0 0 6
Fully imputed dividend paid (5,610) (4,864)
Balance at the end of the year 72,297 62,965
15. INCOME TAX EXPENSE (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
55

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
17. COMMITMENTS
a) Operating Leases
The determination of whether an arrangement is or contains a lease, is based on the substance of the
arrangement and requires an assessment of whether the fulfilment of the arrangement is dependent upon
the use of the specific asset or assets and the arrangement conveys a right to use the asset.
Operating lease payments are recognised as an expense in the statement of financial performance on a
straight-line basis over the lease term. Operating lease costs that are directly attributable to bringing new
vineyards to working condition for their intended use are capitalised up until the time the vineyards become
commercially productive. The accumulated amount is then amortised over the remaining lease term. All
other operating lease payments are recognised as an expense in the periods the amounts are payable.
The Group has entered into long-term vineyard leases which allow the Group to control the growing and
harvesting of the grapes used in the production of finished product. After taking into consideration the
terms and conditions within the lease, it is believed that the lessor retains the significant risks and rewards
of ownership and the leases are accordingly classified as operating leases.
2019 2018
$000 $000
Lease commitments under non-cancellable operating leases:
Within one year 15,135 14,451
One to five years 36,900 38,036
Beyond five years 43,496 56,384
95,531 108,871
Operating lease commitments include long-term land leases, which allow the Group to access prime viticultural land
in the Marlborough and Hawke’s Bay areas. The leases provide the Group the right of first refusal in the event that the
land is put up for sale. Vineyard leases generally comprise an initial term of ten years with following rights of renewal
which vary depending on the vineyard. Leases are reviewed every five years and if required the market rate of rent is
adjusted in relation to the market value of the underlying land plus a guaranteed rate of return as determined by the five
year government bond rate. Other operating lease commitments include short-term car, barrel and equipment leases.
b) Capital Commitments
The estimated capital expenditure contracted for at 30 June 2019 but not provided for is $17,129,000 (2018: $24,813,000).
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
56

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
18. RELATED PARTIES
a) Investment in Subsidiaries
Investments in controlled entities are as follows:
Name of EntityPrincipal ActivityCountry of IncorporationOwnership Interest %
20192018
Delegat LimitedWinemaking, Sales and
Distribution
New Zealand 100.00 100.00
Delegat Canada LimitedBrand MarketingCanada 100.00 100.00
Delegat Australia Pty LimitedSales and DistributionAustralia 100.00 100.00
Oyster Bay Wines (USA) LimitedDormantNew Zealand 100.00 100.00
Delegat USA, Inc.Sales and DistributionUnited States of America 100.00 100.00
Delegat Europe LimitedSales and DistributionUnited Kingdom 100.00 100.00
Delegat (Singapore) Pte. LimitedInvestment Holding
Company
Singapore 100.00 100.00
Barossa Valley Estate Pty LimitedWinemakingAustralia 100.00 100.00
Delegat Japan G.K.DormantJapan 100.00100.00
Delegat (Shanghai) Trading Co. LimitedSales and DistributionChina100.00100.00
The parent company of all subsidiaries is Delegat Group Limited, except for Delegat Europe Limited and Barossa Valley
Estate Pty Limited whose immediate parent company is Delegat Limited, and Delegat (Shanghai) Trading Co. Limited
whose immediate parent company is Delegat (Singapore) Pte. Limited.
All subsidiaries have a 30 June balance date except for Delegat (Shanghai) Trading Co. Limited which has a 31 December
balance date as required by law in China.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
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NOTES TO THE FINANCIAL STATEMENTS CONTINUED
b) Key Management Personnel
Details relating to key management personnel, including remuneration paid, are included within Note 19.
c) Related Parties by Virtue of Share Ownership
The following Directors hold the following number of Shares in the Parent20192018
Delegat Share Protection Trust
(Jakov Delegat and Rosamari Delegat and Robert Wilton – Trustees) 6 6 , 8 5 7, 1 4 2 6 6 , 8 5 7, 1 4 2
Robert Wilton 800,000 1,000,000
John Freeman 11,000 11,000
The individuals above are considered related parties as a result of their shareholding or by virtue of being considered
a member of key management. During the year a total of $68,000 (2018: $65,000) was paid to Robert Wilton in his
capacity as a non-executive Director. Rosamari Delegat received $68,000 (2018: $65,000) in her capacity as a non-
executive Director during the year.
During the year a total of $100,000 (2018: $100,000) was paid to Robert Wilton in his capacity as an independent
consultant, under normal terms and conditions.
Please also refer to the Disclosure of Directors’ Interests at the back of this report.
d) Transactions with Related Parties who have Significant Influence over Subsidiary Companies
During the period Delegat Australia Pty Limited paid a total of $27,000 (2018: $27,000) to Yaroona Pty Limited. The
payments made to Yaroona Pty Limited were made in Peter Taylor’s capacity as Company Director and were under
normal commercial terms and conditions. Peter Taylor was considered to be a related party by virtue of his ability to
significantly influence the financial and operating policies of a subsidiary company.
During the period Barossa Valley Estate Pty Limited paid a total of $49,000 (2018: $45,000) to Range Road Estate Pty
Limited, including directors’ fees of $21,000 (2018: $22,000). The remaining payments made to Range Road Estate Pty
Limited were made in Alan Hoey’s capacity as an independent consultant and under normal terms and conditions. Alan
Hoey was considered to be a related party by virtue of his ability to significantly influence the financial and operating
policies of a subsidiary company.
During the period Delegat Limited paid a total of $2,000 (2018: $8,000) to Range Road Estate Pty Limited. The payments
made to Range Road Estate Pty Limited were made in Alan Hoey’s capacity as an independent consultant and under
normal terms and conditions. Alan Hoey was considered to be a related party by virtue of his ability to significantly
influence the financial and operating policies of a subsidiary company.
During the period Delegat (Singapore) Pte. Limited paid a total of $1,000 (2018: $10,000) and Delegat Limited paid a
total of $5,000 (2018: $Nil) to Camelot Trust Pte. Limited, a company in which a Director of Delegat (Singapore) Pte.
Limited has an interest. The payments made to Camelot Trust Pte. Limited are made in Anita Chew Peck Hwa’s capacity
as Company Director and under normal terms and conditions.
18. RELATED PARTIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
58

NOTES TO THE FINANCIAL STATEMENTS CONTINUED
19. KEY MANAGEMENT PERSONNEL
Compensation of Key Management Personnel
Included in the definition of related parties are Key Management Personnel having authority and responsibility for
planning, directing and controlling the activities of the entity either directly or indirectly, including any Director.
Management has assessed the composition of the Key Management and their compensation for the year ended 30 June
is presented below:
2019 2018
$000 $000
Short-term employee benefits 7, 7 8 1 7, 9 0 9
Post-employment benefits (including defined contribution pension plan) 230 226
8,011 8,135
20. EVENTS SUBSEQUENT TO BALANCE SHEET DATE
On 23 August 2019, the Directors of the Parent declared a fully imputed dividend of $17,192,000 (17.0 cents per Share)
to be paid on 11 October 2019.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
59

INDEPENDENT AUDITOR’S REPORT
Independent auditor’s report to the Shareholders of Delegat Group Limited
Report on the audit of the financial statements
Opinion
We have audited the consolidated financial statements of Delegat Group Limited (“the company”) and its
subsidiaries (together “the Group”) on pages 12 to 59, which comprise the statement of financial position of the
group as at 30 June 2019, and the statement of financial performance, statement of other comprehensive income,
statement of changes in equity and statement of cash flows for the year then ended of the group, and the notes to
the financial statements including a summary of significant accounting policies.
In our opinion, the consolidated financial statements on pages 12 to 59 present fairly, in all material respects,
the financial position of the group as at 30 June 2019 and its financial performance and cash flows for the year
then ended in accordance with New Zealand equivalents to International Financial Reporting Standards and
International Financial Reporting Standards.
This report is made solely to the company’s shareholders, as a body. Our audit has been undertaken so that we
might state to the company’s shareholders those matters 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.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand). Our
responsibilities under those standards are further described in the
Auditor’s Responsibilities for the Audit of the
Financial Statements
section of our report.
We are independent of the group in accordance with Professional and Ethical Standard 1 (revised) Code of Ethics
for Assurance Practitioners issued by the New Zealand Auditing and Assurance Standards Board, and we have
fulfilled our other ethical responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Ernst & Young provides tax advisory and tax compliance services to the Group. Partners and employees of our
firm may deal with the Group on normal terms within the ordinary course of trading activities of the business of
the Group. We have no other relationship with, or interest in, the Group or any of its subsidiaries.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial statements of the current year. These matters were addressed in the context of our audit of the
financial statements as a whole, and in forming our opinion thereon, but we do not provide a separate opinion on
these matters. For each matter below, our description of how our audit addressed the matter is provided in that
context.
We have fulfilled the responsibilities described in the
Auditor’s responsibilities for the audit of the financial
statements
section of the audit report, including in relation to these matters. Accordingly, our audit included the
performance of procedures designed to respond to our assessment of the risks of material misstatement of the
financial statements. The results of our audit procedures, including the procedures performed to address the
matters below, provide the basis for our audit opinion on the accompanying financial statements.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
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INDEPENDENT AUDITOR’S REPORT CONTINUED
Why Significant?How our audit addressed the key audit matter
Revenue Recognition – Cut Off and IFRS 15 implementation
As disclosed in note 3 to the financial statements, the Group
recognised revenue totalling $278m for the period.
The Group adopted NZ IFRS 15 Revenue from Contracts with
Customers (“NZ IFRS 15”) from 1 July 2018. Under NZ IFRS 15 an
entity must recognise revenue with respect to the performance
obligations it has identified within its contracts with customers.
The Group has determined that NZ IFRS 15 does not have any impact
on the timing or measurement of revenue recognition, other than
the reclassification of certain selling, marketing and promotion
expenses now being recorded as a reduction to revenue. This is as
a result of these expenses now being considered an element of the
relevant transaction price.
The Group has adopted the fully retrospective transition provisions
of NZ IFRS 15 and as such the Group has restated the statement of
financial performance for the year ended 30 June 2018. As disclosed
in note 1, the restatement for the year ended 30 June 2018 has
resulted in a reduction in revenue of $16m and a corresponding
reduction in selling, marketing and promotion expenses.
The Group recognises revenue from sale of goods in several
different markets and jurisdictions globally. Control of the goods is
considered to have transferred to the buyer at the time of delivery of
goods to the customer as per the relevant terms of trade.
Revenue recognition is considered a key audit matter due to
the adoption of NZ IFRS15 and the fact that material revenue
transactions can occur close to year end and so there is a risk that
revenue is recognised in the incorrect period.
In obtaining sufficient appropriate audit evidence we:
• evaluated the Group’s revised policies and procedures against the
requirements of NZ IFRS 15, including the restatement of the 30 June
2018 statement of financial performance;
• assessed and tested the design and operating effectiveness of relevant
controls over the timing of revenue recognition;
• tested, on a sample basis, transactions recorded in the periods before
and after year-end to assess whether they were recorded in the correct
period. This included considering shipping documentation or other
documentation indicating the shipping timing and terms;
• analysed credit notes issued after year end to assess whether these
indicated that revenue was incorrectly recognised in the 2019 financial
year; and
• considered the adequacy of the disclosures in the financial statements,
including the NZ IFRS 15 restatement.
Rebates and Promotional Allowances
As disclosed in note 3 to the financial statements, revenue is
recognised net of rebates and promotional allowances owed to
customers based on their individual arrangements, including volume
and non-volume related targets. As disclosed in note 3 the accrual
for these rebates as at 30 June 2019 is $22.7m.
Rebates and promotion expenses include various amounts due to
customers for promotional support and rebates related to sales
volume that are netted against sales. At year end judgement is
required in estimating the level of achievement of future targets by
relevant customers and therefore the level of applicable rebates and
promotional allowances.
The value of the rebate and promotional allowances accrual at
balance date, together with the level of judgment involved in their
estimation, lead to us considering this to be a key audit matter.
In obtaining sufficient appropriate audit evidence we:
• evaluated the Group’s accounting policy with the requirements of
NZ IFRS 15 as it relates to accounting for rebates and promotional
allowances;
• assessed and tested the design and operating effectiveness of relevant
controls over the calculation of rebates and promotional allowances;
• selected a sample of sales promotional expenses from throughout the
year and agreed to supporting documentation;
• performed analysis of the relationship between revenue and the total of
rebates and volume related promotional allowance expenses to ascertain
if this relationship was in line with our understanding of the Group’s
operations;
• considered the assumptions and judgements used by the Group in
calculating the accrual for rebates and promotional allowances by
reviewing management’s calculations supporting the year end accruals.
For a sample of rebate and promotional allowances accruals, we assessed
the calculation prepared by management and validated the calculation
inputs to supporting evidence;
• performed analytical procedures on the rebates and promotional
allowances for the largest accruals in each location in comparison to the
prior year to challenge the nature and quantum of the accruals at year
end; and
• considered the adequacy of the disclosures in the financial statements.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
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INDEPENDENT AUDITOR’S REPORT CONTINUED
Information other than the financial statements and auditor’s report
The directors of the company are responsible for the Annual Report, which includes information other than the
financial statements and auditor’s report.
Our opinion on the financial statements does not cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial statements, 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 during the audit, or otherwise appears to be materially misstated.
If, based upon the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Directors’ responsibilities for the financial statements
The directors are responsible, on behalf of the entity, for the preparation and fair presentation of the financial
statements in accordance with New Zealand equivalents to International Financial Reporting Standards and
International Financial Reporting Standards, 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 on behalf of the entity 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 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 International Standards on Auditing (New Zealand) 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 the auditor’s responsibilities for the audit of the financial statements is located at the
External Reporting Board’s website: https://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-
responsibilities/audit-report-1/. This description forms part of our auditor’s report.
The engagement partner on the audit resulting in this independent auditor’s report is Brent Penrose.
Auckland
23 August 2019
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 2019
62