2020 Annual Report

Scales Corporation Limited
Annual Report
2020

02
Mr Apple coolstore at Whakatu - commissioned in February 2021.

03
Contents
Introduction 04
Key 2020 Highlights 06
Managing Director and Chair’s Report 08
Sustainability Report 18
Divisional Overview 26
Leadership Profiles 40
Financial Statements 44
Independent Auditor’s Report 86
Corporate Governance 91
Director Disclosures 105
Glossary 110
Directory 111

Adapt.
Support.
Grow.
“Unity, personal commitment and adaptation to
change – core characteristics of the Scales team.”
Our 109th year of trading was a year like no other. From lockdowns,
to travel restrictions, and supply chain disruption, the team
successfully navigated a series of obstacles. Deemed to be
essential businesses, we operated throughout all lockdown periods,
and our staff worked tirelessly to respond to the difficulties put in
front of them.
Their safety was, and always is, our absolute priority and we are
indebted to the strength and bravery of our people during those
times. For the 2020 year, not only did Scales perform strongly,
we continued to exceed expectations and break records. This is
testament to the leadership, teamwork and commitment exhibited
by each individual business. The world may have irrevocably
changed, but we look forward to the evolution of Scales as it
operates in a ‘new normal’.
“Thank you to our team of 2,500 for your
hard work and dedication.”
Scales Corporation Limited
Introduction
04

Vertically integrated apple grower,
packer & marketer
Apple marketer
Horticulture
Air & sea freight
Logistics
Petfood ingredient
procurer, processor
and marketer
Juice manufacturer
Food Ingredients
Petfood ingredient
procurer, processor
and marketer
Australia
USA
Introduction
Annual Report - Year Ended 31 December 2020
05

$26.6m
$97.6m
$53.9m$33.8m
15.0c
(2019: $121.6 million)
(2019: $104.9 million)
(2019: $52.7 million)(2019: $36.4 million)
(2019: 84.2 cents)
5.74 m
of all apples
exported
TCEs
Reported Profit for
the Year
Net Cash
Underlying
EBITDA
Underlying

Net Profit After Tax
earnings per
share (EPS)
apples donated
to local and
overseas
communities
35,502
(2019: 39,438 TEUs)
TEUs of ocean
freight managed
Our
Numbers
0.5m
+
(2019: 5.95 million TCEs)
Scales Corporation Limited
06
Key 2020 Highlights

(2019: 16 per cent)
Revenue
TCEs
First
climate
change report
prepared
First
pay equality
review
completed
Third
annual carbon
footprint
certification
undertaken
apples picked
Almost
$
470.7m
19.0c
15%
580m
(2019: $484.6 million)
(ROCE)
per share
(2019: 19.0 cents)
Return on
Capital Employed
115,739
of petfood ingredients sold
1
,
up 4 per cent
of own-grown
apples exported,
up 2 per cent
metric tonnes
3.92m
Dividends
declared of
6.5m
litres of juice sold,
up 6 per cent
1
Includes 100 per cent of volumes from Meateor NZ; i.e. total volumes controlled directly and indirectly by the Meateor Group.
Annual Report - Year Ended 31 December 2020
Key 2020 Highlights
07

Managing Director and Chair’s Report
Performing
under pressure
The launch of Dazzle
TM
in
2020 at high-end Chinese
retailer, Hema.

2020
$’000
2019
$’000
Change
Revenue470,709484,609-3%
EBITDA56,74079,853-29%
Underlying EBITDA53,86252,6992%
Net Profit 26,581121,577-78%
Underlying Net Profit33,76436,399-7%
On behalf of the Board, we are pleased to present Scales’ Annual Report for the
year ended 31 December 2020.
This was a turbulent year, but one in which Scales reported a solid result with
Revenue of $470.7 million and a Profit for the Year of $26.6 million. Our
Underlying
1
results were also pleasing, with Underlying EBITDA and Underlying
NPAT of $53.9 million and $33.8 million respectively.
Andy Borland and Tim Goodacre.
The benefit of our diversified agribusiness strategy
was once again demonstrated. Strong growth in the
Food Ingredients division offset lower earnings in the
Horticulture division, due to the effect and timing
of global lockdowns, driving a significant change in
the earnings mix between divisions as compared to
previous years.
The graphs below show Underlying EBITDA and Underlying NPAT for a five-year period. It should be noted that the
historic results have not been amended for businesses that have been divested or acquired and therefore reflect
the changes in Group structure, particularly from 2019 onwards.
$32.7m
$38.6m
Underlying NPAT
20192020201820172016
$35.8m
$36.4m
$33.8m
1
Directors and management use non-GAAP (Underlying) profit measures when discussing financial performance in this document. The Directors and management believe that
these profit measures provide meaningful information that is helpful to investors and give them a better understanding of a company’s financial performance when presented
in addition to GAAP (NZ IFRS) information. Underlying profit measures are used internally to evaluate performance of our divisions, establish operational goals and to allocate
resources. They also represent some of the profit measures required by Scales’ debt providers. Non-GAAP (Underlying) profit measures are not prepared in accordance with
NZ IFRS and are not uniformly defined, therefore the non-GAAP profit measures reported in this document may not be comparable with those that other entities report and
should not be viewed in isolation or considered as a substitute for GAAP (NZ IFRS) measures reported by Scales. Underlying profit measures were not subject to an audit or review.
A full reconciliation between Underlying and NZ IFRS measures is provided on pages 38 and 39.
All of the above measures (both Underlying and NZ IFRS) are presented before the deduction of Fern Ridge and Shelby non-controlling interests in NPAT of $5.6 million
(2019: $3.6 million).
Underlying EBITDA
$67.9m
20182019202020172016
$67.1m
$52.7m
$53.9m
$62.0m
Annual Report - Year Ended 31 December 2020
09
Managing Director and Chair’s Report

Strategy
Shareholder Returns
Long term returns to our shareholders continues to be of importance to us. Shareholders who invested in
our IPO in July 2014 will have achieved a 257 per cent return
1
on funds invested to the end of February
2021. By comparison, an investment in the S&P NZX50 would have delivered a 135 per cent return on
funds invested over the same period.
Scales’ Vision
To be the foremost investor in, and grower of,
New Zealand agribusinesses by leveraging its unique
insights, experience and access to collaborative synergies.
Strategic Update
Whilst our ability to visit new overseas opportunities
has been curtailed by COVID-19 travel restrictions,
we continue to actively research and review growth
opportunities. These included both internal projects, such
as the construction of our new coolstore at Whakatu, and
external acquisition or investment prospects.
We will continue to seek opportunities that align with our
core strategic vision, play to our strengths and provide a
return in line with our target ROCE.
Scales’ Long Term Goal
To generate a long-run average 15 per cent ROCE
across the portfolio.
Scales Corporation Limited
10
1
Calculated as the difference between the closing share price on 26 February 2021 plus all net dividends paid (a total of $1.105 per share)
and the IPO listing price of $1.60.
Managing Director and Chair’s Report

Specific Strategic Targets
DivisionTargetStatus
Group
SustainabilityExcellent Progress
• Further develop and evolve our reporting and
measuring of key sustainability aspects affecting
Scales’ businesses.
• Develop best-in-class sustainability reporting.
• Demonstrate improvements in sustainability.
In-depth materiality assessment undertaken.
Third carbon footprint certification process
completed.
Inaugural Task Force on Climate-related Financial
Disclosures (TCFD) report prepared.
Pay equality review undertaken.
First social practices audit of the Mr Apple external
supply chain.
Financial and operationalOn Track
• Maintain financial returns in line with, or above,
industry returns.
• Continue to seek acquisitive and organic growth
to expand the business.
A large number of opportunities actively reviewed.
Shareholder returnsOn Track
• Continue to provide shareholders with an
attractive yield on dividends.
• Deliver capital gains and shareholder liquidity
through careful strategic execution.
Interim dividend maintained at 9.5 cents per share.
Continued to maintain Group ROCE above long-
run target of 15 per cent.
Horticulture
Brand and Intellectual Property developmentGood Progress
• Continue to develop the Mr Apple brand,
particularly within our key markets of Asia and the
Middle East.
Ongoing in-market branding initiatives and
marketing activations undertaken.
Continued development of presence in China.
Innovations in product development and launches.
VolumesExcellent Progress
• Reach 4 million export TCEs of our
own-grown apples.
3.92 million TCEs exported, 3 per cent ahead
of forecast.
SalesOn Track
• Continue to increase market penetration
into Asia through services company Primary
Collaboration New Zealand (PCNZ) and strategic
partner China Resources Ng Fung Limited (China
Resources Ng Fung).
Maintained percentage volume of sales to Asia
and Middle East markets.
Continued focus on retail and e-commerce
channel sales.
Plant VarietiesGood Progress
• Acquire new Plant Variety Rights (PVRs) to meet
emerging needs.
• Redevelop lower-performing orchards and
varieties into higher value crops.
Phase 2 of orchard redevelopment plan
completed, with 36 hectares of orchard
redeveloped during winter 2020.
Dazzle
TM
launched through high end Chinese
retailers.
Food
Ingredients
Increase scale and expand offeringSignificant Progress
• Review strategic initiatives and consider organic
and acquisition opportunities to increase
divisional scale.
Advantage taken of the geographical and protein
diversification provided through Shelby and the
Meateor businesses.
New toll processing plant in Dodge City,
Kansas, secured.
Ongoing growth opportunities being
actively investigated.
Logistics
Expand logistics offeringsOngoing
• Develop scale to utilise the expertise and capacity
within the team.
Successfully navigated global supply chain
disruptions caused by COVID-19.
Annual Report - Year Ended 31 December 2020
11
Managing Director and Chair’s Report

Sustainability
Sustainability remains an important part of both our strategic
and day-to-day operations and we have continued to make
considerable progress during 2020, despite the disruptions
of COVID-19. We are excited to include an inaugural TCFD
(climate change) report this year as we believe it is a concern
for all global businesses, of which we are one.
This year we undertook a materiality assessment, the first since
our initial materiality review was completed in 2016. This has
identified new areas of interest and, during 2021, we will work
towards realigning our strategy and environmental plan in line
with the results, whilst developing bigger and bolder goals for
our future.
We encourage you to read our full report in the
Sustainability section.
Scales’ Team
Each year we are keen to recognise and thank our hard-
working Scales team as we are aware that our results would
not be possible without their skill, attitude and personal
commitment. This year brought a number of additional
challenges and, as an essential business, our staff continued to
work in difficult and uncertain times.
We are proud of how each and every staff member rose to the
challenge, and bravely and conscientiously carried out their
responsibilities in a safe manner. We are also pleased to note
that all staff were paid in full during the lockdowns, without
New Zealand government wage subsidies.
Health and safety of our staff continues to be a top priority for
us and this was of particular concern at the start of the March
2020 lockdown. New protocols were quickly implemented, in
compliance with Ministry of Primary Industries’ best practice,
and we continue to operate under this ‘new normal’ today.
We are constantly reviewing our practices, with a view
to expanding on, and developing, our health and safety
initiatives. Every incremental change made is a success and
we are proud to note a decrease in the number and severity
of incidents.
The Board would like to thank every member of staff for the
energy and commitment that is brought by them.
Appropriately
Incentivising our Team
As in prior years, Scales’ management team is accountable
for implementing the strategies as directed by the Board
and therefore we continue to have a strong incentive-based
remuneration scheme. This is aligned to positive personal
performance as well as retaining and developing excellent
team members over the long-term.
The incentive-based remuneration schemes are an important
part of the Board and Managing Director’s objectives, with
shorter term incentives being balanced alongside long-term
business interests. Our remuneration philosophy and analysis
of executive remuneration is detailed more fully in the
Corporate Governance Statement on pages 91 to 104.
12
Scales Corporation Limited
Managing Director and Chair’s Report

Income Statement
2020
$’000
2019
$’000
Revenue470,709484,609
Underlying EBITDA53,86252,699
Underlying EBIT42,98442,453
Underlying Net Profit33,76436,399
After tax impact of:
Non-cash, NZ IFRS and other adjustments(7,183)85,178
Net Profit26,581121,577
Capital employed293,041280,625
ROCE15%16%
Summary
We are pleased to present Revenue and Underlying EBITDA of $470.7 million and
$53.9 million respectively, for the year ended 31 December 2020. Whilst Revenue was
down 3 per cent on last year, Underlying EBITDA increased slightly compared to 2019
due to an excellent performance by the Food Ingredients division.
Additional detail of the performance of each division is provided in the Divisional
Overview section.
Group Financials
Annual Report - Year Ended 31 December 2020
13
Managing Director and Chair’s Report

Capital Management
ROCE is a measure of how efficiently we are generating a return on our assets and it continues to be an important performance
metric for each division and the Group. It is at the heart of how we monitor the performance of the portfolio and make decisions
around capital expenditure. Prior to committing to an investment in assets, we need to be confident that we will generate a return
that meets or exceeds our targets. The ROCE targets vary by division, given each division’s specific asset and risk profiles. However, as
a Group, we target a long-run combined ROCE of 15 per cent.
20202019
ROCE
Horticulture11%17%
Food Ingredients29%16%
Logistics89%70%
Group15%16%
Target15%15%
Group capital employed increased by $12.4 million in 2020. This was primarily due to an increase in Horticulture capital employed
as a result of the construction of its new coolstore and orchard redevelopment expenditure. We expect Horticulture ROCE to remain
below target levels until redeveloped orchards reach maturity from 2023 onwards.
Scales’ basic earnings per share for the year ended 31 December 2020 was 15.0 cents per share (84.2 cents per share in the year
ended 31 December 2019).
1
Financing
Average Net Cash for the year was $76.2 million, a reduction of $5.8 million compared to Average Net Cash during 2019 of
$82.0 million. The movement reflects operating earnings offset by investments in capital expenditure.
Hedging Strategy
As an exporter, we continue to have significant exposure to foreign exchange movements. This is most prevalent in Mr Apple,
but our Food Ingredients and Logistics divisions are also affected. We also have exposure to movements in interest rates, both on
borrowings and deposits.
Scales has a Board approved Treasury Management Policy, which governs how all foreign exchange, interest rate and related
activities are conducted. This policy is reviewed biennially.
Under this policy we may take foreign exchange cover for Mr Apple for up to 48 months using a variety of foreign exchange
instruments (including options and forward contracts). Scales maintains a blend of instruments. In addition, Scales attempts to
manage the cover levels for seasonal and market variations for future years.
We continue to have a natural hedge covering some of our US dollar exposure as international shipping is payable in US dollars.
We take cover on the remaining expected net US dollar, Euro, British pound and Canadian dollar exposures.
In general, Food Ingredients and Logistics cover foreign currency exposures once contracted.
1
Based on the weighted average number of ordinary shares.
Euros 25%
Canadian dollars 2%
US dollars 63%
British pounds 10%
The average conversion rate of Mr Apple’s main foreign
currency exposures since 2017 were as noted below:
2020201920182017
USD .6424.6664.6790.6858
EUR.5671.5663.5806.5846
GBP.5101.4658.4839.4535
CAD.8657.8650.8582.8625
Foreign currency
In 2020, Mr Apple’s net foreign currency exposures were as
shown below:
Scales Corporation Limited
14
Managing Director and Chair’s Report

The hedging position for Mr Apple’s main foreign currency exposures, as at 3 March 2021, was:
20212022202320242025
USD
% cover of expected exposure66%46%32%3%-
Average rate of cover .6552 .6534 .6364 .6250 -
EUR
% cover of expected exposure83%80%53%53%19%
Average rate of cover .5476 .5335 .5396 .5278 .5555
Interest rates
In addition, we take out interest rate swaps and forward rate agreements, which provide some certainty on interest costs on Scales’
term and short-term borrowings. As at 31 December 2020 our NZ dollar term debt was 100% covered by interest rate swaps. We
funded the US dollar investment in Shelby via a US dollar term loan to provide a hedge on the investment.
Dividend
A final 2019 fully imputed cash dividend of 9.5 cents per share (a gross amount of 13.2 cents per share) was paid on 10 July 2020.
Together with a 2019 interim dividend of 9.5 cents per share (a gross amount of 13.2 cents per share) that was paid on 17 January
2020, this brought the annual dividends for 2019 to a total of 19.0 cents per share (a gross amount of 26.4 cents per share).
A fully imputed interim 2020 cash dividend of 9.5 cents per share (a gross amount of 13.2 cents per share) was declared on
9 December 2020 and paid on 15 January 2021. Our expectation is to declare a final fully imputed cash dividend in respect of 2020
in May 2021, for payment in July 2021. As always, any dividend is subject to Board approval. It is standard practice for the Directors
to consider all aspects of the Group’s performance and financial position prior to declaring any dividend but remain committed to
the current annual cash dividend level of no less than 19 cents per share whilst the Group holds net cash, although at a level no
greater than Underlying Net Profit for each year.
Capital Expenditure
Capital expenditure in 2020 was $24.4 million. Whilst this was $8.7 million higher than 2019 ($15.7 million), this spend was in line
with expectations. Material expenditure included:
• Approximately 36 hectares of orchard redevelopment at Mr Apple during the 2020 winter ($4.9 million).
• Mr Apple Whakatu coolstore build ($11.5 million). An additional spend of approximately $2.5 million will be recognised in 2021.
• Additional spend on RSE accommodation upgrade at Mr Apple ($2.0 million).
2020
$’000
2019
$’000
Operational capital expenditure
Horticulture4,2763,139
Food Ingredients471191
Logistics92470
Other610
Total operational capital expenditure4,8453,811
Growth capital expenditure
Horticulture19,52411,863
Total growth capital expenditure19,52411,863
Total capital expenditure24,36915,674
Future capex is likely to be focussed on margin-improving automation and efficiencies in the Horticulture division, as the majority of
our orchard redevelopment is now complete.
Annual Report - Year Ended 31 December 2020
15
Managing Director and Chair’s Report

Tim Goodacre
Chair
18 March 2021
Andy Borland
Managing Director
Scales Corporation Limited
16
Managing Director and Chair’s Report
Outlook
We learned to operate in a ‘new normal’ in 2020, adapting to change and uncertainty as the year unfolded. The
start of 2021 has not been without its own challenges, with inclement national weather events taking place over the
key growing period and the continued disruption to global supply chains bringing ongoing delays in shipping and
increased costs.
Within the Horticulture division, the 2021 apple harvest has begun with early fruit shipments made to Asia. Whilst
lower fruit volumes are anticipated due to climatic events, we expect this to be partially offset by improved pricing.
Mr Apple is also focused on opportunities to improve margins by accelerating automation initiatives, particularly in
post-harvest operations.
Food Ingredients is expected to continue to take advantage of the growing global petfood market. We are excited
for the future of this division and continue to actively pursue organic and external growth opportunities to diversify
and expand its geographical reach, product range and protein offering.
In conclusion, we would like to thank all our management and staff, fellow Directors, suppliers, customers and other
stakeholders for their collective support and assistance in our 109
th
year of trading. The entire team looks forward to
2021 and whatever challenges it may bring.

17
Annual Report - Year Ended 31 December 2020
Managing Director and Chair’s Report

Sustainability Report
Championing a
sustainable culture
Mr Apple staff taking part in iMove stretching.

In 2020, Scales navigated its way through its second pandemic - the first being the influenza
pandemic in 1918. COVID-19’s unpredictable nature initially brought about feelings of
anxiety and disbelief but very quickly it became evident that our ability to be agile and
dynamic allowed each of our essential businesses to make our workplaces and team
members safe and secure. All of this happened at the very height of our busy season, with
nearly 2,500 people employed.
The 2020 pandemic proved that, even in the face of extreme uncertainty and disruption,
Scales management and staff could pull together, determined to weather the storm. We will
continue that resilience and personal commitment into 2021 as a strong and united team.
Materiality Review
In our inaugural Sustainability Report in 2016, we
identified a materiality index that was relevant
to the Group at that time. In 2020, we identified
the need to undertake updated stakeholder
engagement and materiality exercises to ensure
that our focus remained current.
Partnering with thinkstep-anz this involved:
• 6 internal and 9 external stakeholders’
interviews to identify the material issues
facing Scales.
• 41 stakeholders completing an online
ranking survey.
• 11 internal stakeholders participating in a
business impact ranking workshop.
• 13 participants in a 3-horizons future-
focused risk review.
The outcome of this review was as shown on
the right, and this will provide our focus for
future periods.
20162020
Employment
Health and Safety
Workplace Stability
Employee Attraction,
Development and Retention
RSE Scheme
Succession Planning
Health and Safety
Labour Practices
Culture and Values
Diversity and Inclusion
Community
Water Use
Carbon
Water Quality
Energy Use
Weather and Climate
Biodiversity
Fruit Waste
Refrigeration
Soil Health
Water Management
Carbon and Energy Use
Weather and Climate
Biodiversity
Waste
Ethical Supply Chain
Supplier Requirements
Spray Use and Residues
Food Safety
Consumer Preferences
Spray Use and Residues
Food Quality and Safety
Consumer Preferences
Market Access and Risk
Intellectual Property
Innovation
Legal Compliance
Business Continuity
Corporate Governance
ESG Strategy and
Communication
Brand Awareness
Materiality Issues list
MARKETPLACE
CORPORATE
PEOPLE
ENVIRONMENT
Annual Report - Year Ended 31 December 2020
19
Sustainability Report

PEOPLE
Pay Equality Review
During 2020 we undertook our first pay equality review with
pleasing results.
It was found that Scales offers pay equity and, when
comparing like-with-like, minimal further investigation was
required. The CEOs of each business unit were keen to
ensure that pay rates are reflective of role, experience,
responsibility and tenure, not gender.
We will continue to monitor these on a regular basis.
Scales Corporation Limited
20
Sustainability Report
500+
Permanent staff members
35
Operational sites
~80%
Of training incorporates a
health and safety element
~1,300
34%
30%
RSE workers
Permanent female
staff Scales wide
Female senior
management staff
Health and Safety
“Health and safety are an important and integral
part of our everyday practices – safety to the core.”
Health and safety culture continues to be a significant focus of the business, and our processes were tested during our COVID-19
response. Pleasingly, COVID-19 also highlighted connectivity between our businesses, with each business exhibiting a strong team
culture. We believe this is reflective of the ingrained Scales philosophy.
Initiatives
A number of initiatives were undertaken or developed
through the year. These included:
• A full cross-team critical risk review.
• Further development of the company-wide forklift
training framework.
• Overall health and safety strategy.
• Guarding of risk areas and traffic management.
• Cross-company training, learning and auditing.
• Continued implementation of suggestions from the
2019 SafePlus assessment.
• Roll out of employee assistance programmes, in
conjunction with Vitae, a workplace wellbeing and
employee assistance provider.
The critical risk review identified new hazards, and sought
solutions, with a team approach. This resulted in the
identification of critical controls and non-negotiables, and the
development of a risk scoring matrix to better understand the
range of risks across a variety of scenarios.
An analysis of injuries continued to show a decline in the
number and severity of injuries, due to a continued focus on
injury prevention and management. Our Lost Time Injury rate
remains static, with sprains continuing to contribute towards
the most days off work. Several injury prevention measures are
in place with our iMove (movement and mechanics) awareness
training being undertaken throughout each business.
WorkSafe New Zealand interactions continued in 2020 with
onsite inspections at Scales Logistics. Mr Apple also took part
in an industry / WorkSafe harm-reduction pilot, and results of
this are due in 2021.
People are at the heart of what we do

Recognition
We are immensely proud to note that our Managing Director,
Andy Borland, was the winner of the Leadership Award at
the INFINZ Awards Dinner in October 2020. This award,
assessed by an expert judging panel, focuses on key measures
of financial performance as well as critical elements that
deliver sustained performance over time, including leadership,
building a strong and positive company culture and strong
engagement with employees, customers and the community.
The award provides external recognition of the leadership
skills and vision that Andy brings to the Group, verifying our
own internal perception of his remarkable abilities.
Governance
and Ethics
It was important to the Board that,
notwithstanding the logistical challenges
presented by COVID-19, good governance
practices should prevail throughout the
year. As a result, we held a virtual Annual
Shareholders’ Meeting (ASM) in June 2020
– the first virtual ASM in over 100 years of
trading. As was the case for many businesses,
Zoom meetings became the norm, with Board
meetings undertaken on this platform as and
when needed.
Excellent leadership and teamwork was
exhibited by all staff, with the entire Scales
team rising to all challenges presented
throughout the year.
We refreshed a number of our ethics policies
during the year including:
• Anti-fraud, bribery and corruption.
• Travel and related expenses.
• Gifts and hospitality.
In addition, we launched a new policy on
Sensitive Information (Private, Commercially
Sensitive and Confidential). Training will be
instigated throughout the Group during 2021.
Marketplace
Technology
Our digital transformation strategy continued to
be a focus, allowing us to incorporate cost savings
and efficiencies within the business. Examples of
these in 2020 included:
• A reduction in paper use and printing costs
resulting in an almost 50 per cent reduction
in the number of printers being required
throughout the businesses.
• Production efficiencies and reduced forklift
movements through more precise inventory
control.
Certifications and Audits
We are aware of our impact on the marketplace
and continue to also be aware of the needs and
requests of our external stakeholders. Accordingly:
• We realigned our Good Agricultural Produce
(GAP) certifications within Mr Apple.
• We undertook a GLOBAL GAP Risk Assessment
on Social Practice (GRASP) audit of our supply
chain for worker welfare practices.
• We have an ongoing focus on traceability
within the business including a move, where
possible, to digital options to streamline and
fast track approvals .
CORPORATE
MARKETPLACE
Annual Report - Year Ended 31 December 2020
21
Sustainability Report

ENVIRONMENT
Our Environment
Highlights
We are acutely aware of the impact of our business
operations on the world and its environment – our
actions now will have a long-lasting effect. As a result,
we want to ensure that we manage our environmental
footprint and be proud of the legacy that we leave.
Highlights from our work in 2020 included:
• A submission placed by Mr Apple as part of the
Tu
-
taekur
I
-
, Ahuriri, Ngaruroro and Karamu
-
(TANK)
catchments process to secure water quality and
quantity for the future within Hawke’s Bay.
• Participation in an industry pilot for farm
Environmental Plans as part of the TANK review.
• Continued hosting of a horticulture waste
minimisation group (with local councils) identifying
avenues for waste that would otherwise be destined
for landfill.
• Ongoing work on carbon sequestration in respect of
apple tree plantings, in partnership with Auckland
University of Technology.
• An in-house climate change workshop to better
understand future risks and opportunities.
In 2021, we will employ a sustainability advisor to assist
us with our Environmental Plans. We believe that this
will allow us to source alternative waste streams and
ensure that each part of the business optimises its ability
to reduce, reuse and recycle.
Mr Apple Environmental Plan
We continued to align our business practices to our chosen United
Nations Sustainable Development Goals.
Notwithstanding the disruption caused by the effects of COVID-19,
we are thrilled with the progress we have made against our goals.
Whilst we encountered an increase in fuel use, this increase was due
to a variety of specific factors and was partially offset by the initatives
noted. We remain committed to continuing our improvement journey
and addressing areas of relative underperformance:
GoalInitiatives
Change
2018 to 2020
Reduce paper
use by 10
per cent per
annum
Software improvements to
eliminate paper use.
Digital transformation strategy.
Zoom capability in meeting rooms,
allowing screen sharing rather
than document printing.
60 per cent
reduction
Reduce
electricity
consumption
by 3 per cent
by 2024
EECA audit recommendations.
LED replacement strategy.
Shut-down periods.
Evaporator fan timers.
Power factoring considerations.
11 per cent
reduction
Reduce overall
fuel use by 5
per cent by
2024
Reduced trucking movements.
New trucking/tractor/vehicle fleet.
EROAD monitoring.
Change of petrol equipment
to electric.
Proactive maintenance.
11 per cent
increase
Reduce waste
to landfill by
up to 30 per
cent by 2024
Collaboration within industry and
local businesses to achieve other
avenues for waste.
Installation of balers.
Improved recycling facilities.
Education campaigns.
Removal of items where
compostable or recyclable options
are available.
48 per cent
reduction
Polythene wrap being baled for
collection by a recycling company.
Scales Corporation Limited
22
Sustainability Report

Carbon Footprint
Our carbon footprint equates to total gross
greenhouse gas (GHG) emissions per:
• All staff (at peak season) of 10.63 tCO2e
(2018: 10.39 tCO2e).
• Bins tipped of 0.086 tCO2e
(2018: 0.085 tCO2e).
• Cartons exported of 0.0046 tCO2e
(2018: 0.0046 tCO2e).
• Hectares planted of 19.60 tCO2e
(2018: 19.75 tCO2e).
• Permanent employees of 56.71 tCO2e
(2018: 60.14 tCO2e).
Toitu
-
Envirocare carbonreduce
Certification
Toitu
-
carbonreduce programme and emission
reduction initiatives are now into their third year,
with an ongoing reduction in emission intensity.
Compared to our initial footprint in 2018:
• The overall carbon footprint for Mr Apple has increased by
3 per cent to 23,535 tonnes of carbon dioxide equivalent
(tCO2e).
• Direct emissions from owned or controlled sources has
increased by 11 per cent to 3,224 tCO2e. This was due to a
variety of factors including increased fuel use for irrigation,
a longer packing season and extended occupancy of the
RSE accommodation.
• Indirect emissions from the generation of purchased energy
has decreased by 11 per cent to 1,870 tCO2e.
• All other indirect emissions that occur in Mr Apple’s value
chain have increased by 4 per cent to 18,437 tCO2e.
Putting this in context, whilst our emissions have increased
by 3 per cent, our production, number of TCEs exported and
number of hectares planted have also increased. As a result,
our emissions intensity has reduced, meaning we are more
efficient in what we do vis-a-vis plantings and permanent staff:
• ~ 1 per cent efficiency gain (emission intensity reduction)
per hectares planted.
• ~ 5.7 per cent efficiency gain (emission intensity reduction)
per permanent employee.
Packaging strapping is now chipped and collected for repurposing.
Annual Report - Year Ended 31 December 2020
23
Sustainability Report

Our TCFD Report
In this inaugural climate change report, we set out the 4 areas of the TCFD framework (which includes 11 disclosure
recommendations) to explore what impacts climate change will have upon our business (risks and opportunities) and the
direction in which we are going to address or adapt to them.
Over time our reporting will evolve to include scenario modelling, the strategies that we will wrap around those predictions
and our increasing knowledge about our best future path.
THEME 1THEME 2
Governance
Disclose the organisation’s
governance around
climate-related risks
and opportunities.
Our Board receives information on risks and
opportunities via our Health & Safety
and Sustainability Committee, through
Board reports and via general updates.
These are discussed at a Board level and
also within the Audit and Risk
Management Committee.
Climate change considerations are made at the
risk-assessment level when evaluating strategy,
budgets, KPI’s, business plans, and mergers
and acquisitions.
The Board also receives a copy of Toitu
-

carbonreduce reports and the ongoing
Environmental Plan in order to evaluate progress
towards goals.
We focused primarily on Mr Apple in 2020 due
to our direct control over the supply chain and
operations of the business. In future, we will
more closely analyse the potential third-party
effects of climate change upon the supply chains
of our other businesses.
The initial scenario contemplated an increase
in world temperatures of 2 degrees centigrade.
In future years we will extend that to a more
extreme change and test our strategy against
those risks and opportunities.
Work has been undertaken to categorise risks
and opportunities:
• Defined as short (less than 2 years), medium
(2 to 10 years) or long term (over 10 years).
• Categorised as low, medium or high risk.
• Potential impacts have been identified.
• Potential opportunities have been identified.
From this assessment, water availability and
accessibility has been identified as the primary
climate change risk to the business. However,
this is seen as a medium to long-term risk as
New Zealand (and, in particular, Hawke’s Bay)
currently presents favourable growing conditions
with a good supply of water. Accordingly, current
conditions do not present any material issues, but
this will be closely monitored for all risks
and opportunities.
Our evolving climate change awareness and
understanding will be factored into our annual
internal audit programme to ensure that
strategies remain relevant and timely.
Strategy
Disclose the actual and
potential impacts of climate-
related risks and opportunities
on the organisation’s
businesses, strategy, and
financial planning where such
information is material.
Scales Corporation Limited
24
Sustainability Report

1
https://www.iso.org/standard/66453.html
Metrics & Targets
Disclose the metrics and targets
used to assess and manage
relevant climate-related risks
and opportunities where such
information is material.
THEME 3THEME 4
Mr Apple conducted an in-house climate-related
risk workshop, working through NIWA predictions
for low to high climatic changes that had the
potential to affect supply both within horticulture
and agriculture. The workshop outcomes were
based on assumptions with institutional knowledge
and experience, and did not produce a forecast or
prediction model.
Although the management of climate-related risks
are factored into well established and embedded
strategies such as irrigation management and
redevelopment opportunities, the materiality
matrix refresh undertaken with thinkstep-anz also
highlighted further areas of focus within water
management and climate change in general.
Goals, as detailed in the Toitu
-
carbonreduce scheme
and Environmental Plan process, are monitored and
reported upon to minimise our effect upon climate
change and its effect upon us.
Risk Management
Disclose how the organisation
identifies, assesses, and manages
climate-related risks.
As previously mentioned, our primary focus has
been on Mr Apple and the organisational control
we have over the growing, packing and storage
environment. Going forward, our focus will be
extended to the remaining Scales businesses.
Measurements within the business are validated by
being part of the Toitu
-
carbonreduce programme,
for which we are independently audited annually
against ISO 14064 (Greenhouse Gases)
1
. Through
this, our Scope 1, 2 and 3 emissions are reported
upon, together with targets for reduction,
our progress in achieving those targets and
acknowledgement of those that remain out of
our control.
The following main risks, opportunities and anticipated impacts were identified at our in-house climate-related workshop.
RisksCurrent StrategiesFuture Strategies Opportunities
Water
Reduced access to sufficient,
quality, water.
• Continued focus on water
management, including maintenance
of existing water rights.
• Continued focus on our effect on
water sources.
• Active participation in water right
negotiations and farm environmental
plan development.
• Investigation of
water storage
possibilities.
• Continued
investment into
more Sensortech and
improved irrigation
systems.
Increased
frequency
and severity
of weather
events
Damage to crop and/or trees.
Disruption to logistics chain.
• Geographical spread of orchards.
• Investment in frost protection
machines and optical grading
technology.
• Crop insurance providing cover for
severe crop losses.
• Use of canopy cover and planted
shelter belts.
• Analysis of canopy
covers.
• Increased wind
protection.
• Canopy structure
review.
Rising
average
temperatures
Change in growing/ripening
profile and orchard yields.
Reduced crop quality due to
sunburn and tree stress.
Potential pest and disease
profile change.
Increased management costs
e.g., additional sprays.
• Continued management focus on
minimising sunburn and tree stress.
• Continued targeted programme for
pests and diseases.
• Active membership on industry
bodies.
• To understand extent
of temperature
change.
• Review new growing
regions for ideal
climatic conditions.
• Reduced
frosts.
• Increased
dry days
improving
pollination
and potentially
reducing pest
and disease
risk.
Reduced
minimum /
maximum
temperature
differences
Availability of overseas
workers if climate-changes in
their homelands impact thier
ability to travel.
Less fruit colour if nights
are warmer.
• Continued engagement with the
Government regarding the RSE
scheme, and other work schemes.
• Use of reflective cloth to increase
fruit colour.
• To understand
the extent of
temperature
differences and
the impact on
the crop.
Annual Report - Year Ended 31 December 2020
25
Sustainability Report

Divisional Overview
Structure
builds
confidence

This section provides a summary of each of our 3 operating divisions, including their
performance and key operating statistics. In line with our Group results, we focus on the
Underlying financial performance of our business divisions, excluding certain non-cash,
NZ IFRS and other adjustments.
Horticulture
Overview
Our Horticulture division continues to be the largest division
within the Scales group and comprises:
• Mr Apple, New Zealand’s largest fully vertically integrated
apple business, based in Hawke’s Bay.
• A 73 per cent stake in Fern Ridge, a fresh produce exporter
in Hawke’s Bay.
During 2020, we operated 3 packhouses. Each of our
packhouses are equipped with high-speed optical grading
machines. Our fourth packhouse at Havelock North, which
was decommissioned in 2019 and was being used as a storage
and training facility, has subsequently been sold.
Mr Apple also operates 6 coolstores.
Orchard Redevelopment
During winter 2020, Mr Apple completed the second phase
of its orchard redevelopment programme, planting and / or
redeveloping around 36 hectares of orchard. This brings the
total orchard redeveloped since 2008 to over 530 hectares,
of which approximately 141 hectares were redeveloped to
Dazzle
TM
and Posy
TM
, premium brands in which we have a
proprietary interest.
During this time, export sales to Asia and the Middle East
increased from 20 per cent in 2007 to 62 per cent in 2020.
New planting techniques have also been adopted in recent
years, significantly changing orchard management. A new
‘2-dimensional’ structure is being embraced, which is expected
to be more efficient to prune, thin, and pick. Accordingly, we
anticipate higher average prices and yields will be achieved as
these orchards reach commercial scale from 2023 onwards.
0
1000
2000
2018201920202021F2022F2023F2024F2025F
3000
4000
5000
3,867
1,901
2,161
2,238
2,170
2,325
2,478
2,639
1,9661,661
1,678
1,633
1,609
1,619
1,626
2,738
1,631
3,822
3,915
3,803
3,933
4,097
4,264
4,369
Traditional Varieties
Premium Varieties
Mr Apple Own Export Volumes (TCE 000s)
The market prospects for our existing varieties are continually reviewed and a further phase of orchard redevelopment may be
undertaken at a future time.
Annual Report - Year Ended 31 December 2020
27
Divisional Overview

Markets
New Zealand’s climate, resources, skills and clean, green image makes it an excellent location in which to grow apples. Our apples
are sought after around the world and we sell apples to more than 160 customers in 40 countries.
Mr Apple - Sales by Region (TCEs)
2019
The benefit of the division’s diversified channels and markets
was highlighted during 2020. Export volumes into Asia and
the Middle East were adversely affected by the timing of
lockdowns together with the resulting impact on logistics and
purchasing patterns. However, sales into Europe and the UK
were positive, with an increased throughput of produce and
strong demand for traditional varieties.
Notwithstanding the difficulties of 2020, the Asia and Middle
East markets accounted for 62 per cent of export sales, with
sales to China continuing to represent approximately 17 per
cent of Mr Apple’s export volumes (2019: 17 per cent). This is
underpinned by our ongoing in-market efforts, together with
support from our cornerstone shareholder China Resources Ng
Fung and increased participation in the market by PCNZ.
2020
Marketing Developments
Mr Apple is committed to being the number one preferred
New Zealand apple brand in the international market place.
As such, we are investing time and resources into delivering
innovative marketing activations and in-market branding
initiatives, particularly in Asia and the Middle East, to support
our new proprietary varieties, Dazzle
TM
and Posy
TM
. Examples
of these activities include:
• The launch of Dazzle
TM
in 2020 through high-end
Chinese retailers such as Hema. Target promotions will be
undertaken in both Vietnam and China in 2021.
• A flagship store on TMALL is expected to be operational
in the first half of 2021. TMALL is a business-to-consumer
online retail platform operated by the Alibaba Group,
which allows international businesses to sell and market
branded goods direct to consumers in China.
TMALL is an example of our efforts to develop and grow
our retail and e-commerce sales channels and, with these
channels now accounting for over half of all Mr Apple China
sales in 2020, they represent a significant area of focus.
We are also delighted to note additional investment in this
area, having recently appointed a senior marketing manager
to the team.
The launch of Dazzle
TM
in 2020 at high-end Chinese retailer, Hema.
Scales Corporation Limited
28
Divisional Overview
Asia &
Middle East
66%
Europe
21%
UK
11%
North
America
2%
Asia &
Middle East
62%
Europe
24%
UK
10%
North
America
4%

Financial Performance and Key Operating Statistics
Summary Performance
The table below shows the financial performance of our Horticulture division for 2020 and 2019.
Horticulture Financial Performance
2020
$’000
2019
$’000
Horticulture revenue245,984264,782
Underlying EBITDA
Mr Apple 29,40737,357
Fern Ridge 2,0162,294
Underlying Horticulture EBITDA31,42339,651
Depreciation and amortisation(9,524)(8,781)
Underlying Horticulture EBIT21,89930,870
Horticulture EBITDA35,78147,909
Horticulture EBIT18,67032,005
Capital employed202,020187,768
ROCE11%17%
NB: The table above includes 100 per cent of the EBITDA contribution from Fern Ridge. Approximately 27 per cent of Fern Ridge is owned by non-controlling
interests. We recorded a non-controlling interest of $0.4 million (2019: $0.4 million) in our Group results reflecting their share of tax paid profit from Fern Ridge.
A reconciliation of Underlying to Reported profit measures follows this Divisional Overview section.
Annual Report - Year Ended 31 December 2020
29
Divisional Overview
The Horticulture division generated revenue of $246.0 million,
down 7 per cent on 2019 ($264.8 million). This was due to
the impact of lockdowns on the sale of produce into Asia and
the Middle East, which affected pricing for those geographies.
Pricing, together with an increase in labour costs, impacted
Horticulture’s earnings, with Underlying EBITDA down by
21 per cent to $31.4 million (2019: $39.7 million). Underlying
EBIT was down 29 per cent to $21.9 million (2019:
$30.9 million). Details of initiatives to maintain or improve
margins are provided later in this report.
Horticulture’s ROCE decreased this year due to lower earnings
and significant capital expenditure. However, returns for this
division are expected to increase once redeveloped orchards
reach maturity and the impact of margin initiatives take effect.

20202019201820172016
Orchard
Total planted orchard (at time of harvest)
1
Ha.1,1861,158 1,149 1,142 1,042
Fully mature equivalent planted orchardHa.1,0281,023 1,057 1,043 922
Apples picked (Mr Apple orchards)TCE 000s5,1194,841 5,090 4,434 4,360
Apples packed (Mr Apple + external growers
(Hawke’s Bay))TCE 000s4,8584,747 4,739 4,354 4,150
Exported volume
Mr AppleTCE 000s3,9153,822 3,867 3,545 3,546
External growers
2
TCE 000s1,8242,132 1,964 2,078 1,187
TotalTCE 000s5,7395,953 5,831 5,622 4,733
Mr Apple packout %76%79%76%80%81%
Total NZ productionTCE 000s22,19921,755 20,687 18,956 19,346
Mr Apple own grown volume share of NZ production17.6%17.6%18.7%18.7%18.3%
The division continued to exceed expectations around volumes. At 3.92 million TCEs of own-grown volumes, 2020 represented
another record production year.
• With the average TCE holding 113 apples, almost 580 million apples were picked from Mr Apple’s planted apple orchards.
• Gross production was 5.12 million TCEs from which 3.92 million TCEs were exported. This was a 2 per cent increase in export
TCEs compared to prior year, and a 3 per cent increase compared to forecast.
• Together with our external grower volumes, the division sold 5.74 million TCEs. This was 4 per cent down on 2019 as Fern Ridge
replaced a portion of its apple volumes with kiwifruit sales, which have not been included in the reported volumes.
• We continue to provide a significant contribution to the national apple crop, with production from our owned and leased
orchards accounting for 17.6 per cent of New Zealand’s apple exports (2019: 17.6 per cent).
Orchard Statistics
We continue to monitor and report against various operating statistics, a selection of which are noted below.
Scales Corporation Limited
30
Divisional Overview
1
Planted orchard at the end of the year was 1,201 hectares.
2
External grower volumes from 2017 onwards include Fern Ridge.

Volumes and Prices
Volumes and prices (on a NZD FOB basis) for 2020 and 2019 are noted below.
Volumes by Variety (TCE 000s)20202019
Premium Varieties
NZ Queen534538
Pink Lady401 378
Red Sports (Fuji and Royal Gala)1,0491,046
Other253199
Total2,2382,161
Growth4%14%
% premium57%57%
Traditional Varieties
Braeburn506561
Royal Gala503494
Other669606
Total1,6781,661
Growth1%(16%)
Total Mr Apple owned and leased orchards3,9153,822
Growth2%(1%)
Prices by Variety (NZD / TCE (FOB))
Weighted average price for premium varieties36.9 39.8
Weighted average price for traditional varieties30.1 29.3
Total weighted average price34.0 35.2
As noted above, premium varieties continue to be a focus for the division, with a 4 per cent increase in these volumes compared to
2019. We also delivered a 1 per cent increase in traditional varieties.
Our weighted average FOB price for premium varieties decreased by 7 per cent compared to 2019 due to some tightening of prices
in the Asia markets as a result of the impact and timing of lockdowns. However, the decrease in pricing for premium varieties was
partially offset by a firming up of prices in European markets.
Annual Report - Year Ended 31 December 2020
31
Divisional Overview

2021 Outlook
The outlook for Horticulture is positive at this time. The 2021 apple crop is of good fruit-size, brix and colour and sales activity
remains supportive. Whilst Mr Apple anticipates lower fruit volumes as a result of national weather events over the key growing
period, this is expected to be partially offset by higher in-market prices. Early fruit shipments to Asia have been well received and a
lower national crop in Europe and the UK is expected to lower in-market supply.
We believe that the majority of challenges and additional costs being experienced domestically in 2021 will normalise and we expect
margins to return to 2019 levels in 2022.
Premium volumes account for around 57 per cent of all exports, in line with 2019. There were similar or increased volumes across
most premium varieties, with significant percentage increases in our new varieties, including Dazzle
TM
and Posy
TM
.
Margin Improvement
We acknowledge that we are currently experiencing headwinds in margin and, earlier this year, we provided details of a number of
initiatives that we had identified in order to maintain or improve margins. This continues to be a focus.
The completion of Mr Apple’s new coolstore at Whakatu is expected to provide both operational and logistic efficiencies. The
coolstore was completed on time and on budget and has allowed us to sell our Havelock North packhouse. This permits greater
centralisation of our post-harvest operations.
As previously mentioned, Mr Apple completed the second phase of its orchard redevelopment during winter 2020 resulting in over
140 ha of orchard planted and / or redeveloped between 2018 and 2020. Our focus over this phase of planting was in high-value
varieties such as Posy
TM
and Dazzle
TM
, together with incorporating new ‘2-dimensional’ planting techniques. We anticipate higher
prices and yields as these orchards reach commercial scale.
We also note that the environment for the availability and cost of labour has changed. Whilst retention of the RSE scheme at
pre-COVID levels continues to be critical to our ability to pick and pack our harvest, it is our intention to accelerate automation
initiatives particularly in the post-harvest area. We expect to commit to certain automation initiatives during 2021.
Scales Corporation Limited
32
Divisional Overview
3,500
3,000
2,500
2,000
1,500
1,000
500
0
20112012201320142015201620172018
4,000
20192020
Other Premium
Red Sports
(Fuji and Royal Gala)
Pink Lady
NZ Queen
Other Traditional
Royal Gala
Braeburn
Volumes by Variety (TCE 000’s)
Mr Apple EBIT Margins
1
Through Time
25%
2015201620172018201920202021B2022F2023F2024F2025F
20%
15%
10%
5%
0%
1
Historic results have been adjusted to remove hail insurance proceeds in 2015.

Mr Apple Orchard Managers and Senior Teams
Annual Report - Year Ended 31 December 2020
33
Divisional Overview
Clive OrchardClose Orchard
Applewaites Orchard
Sorrento OrchardTe Papa Orchard
Blyth Orchard
Pakowhai Orchard
Kinross Orchard
Rangihau Orchard
Thornton Orchard
Scotland Orchard
Brookfield Orchard
Pilos Orchard
Kanuka Orchard
Pacific Orchard

Food Ingredients
Overview
Our Food Ingredients division converts agricultural by-
products into valuable food commodities. The division
comprises 4 businesses:
• Meateor NZ – 50 per cent ownership of a processor and
marketer of petfood ingredients for the global petfood
industry with processing plants in Whakatu and Dunedin.
*
Equity accounted.
**
Fully consolidated into Scales’ financial results, with Shelby non-controlling interest of $5.2 million deducted from NPAT (2019: $3.1 million).
Meateor NZ
*
Petfood ingredient
processor and marketer,
New Zealand (50%)
Profruit
*
Juice concentrate processor,
New Zealand

(50%)
Food Ingredients Structure
Meateor Group
Meateor
International
**
Petfood ingredient supplier,
Australia & other markets

(100%)
Shelby
**
Petfood ingredient procurer,
processor and marketer, USA

(60%)
• Meateor International – 100 per cent ownership of a
supplier and marketer of petfood ingredients from Australia
and other markets.
• Shelby – 60 per cent ownership of a US procurer, processor
and marketer of ingredients for the petfood industry.
• Profruit – 50 per cent ownership of a manufacturer of high
quality apple, kiwifruit and pear juice concentrates, located
in Hawke’s Bay.
Emergency Stop Buttons at Meateor’s
New Zealand plants, installed following
health and safety reviews.
Scales Corporation Limited
34
Divisional Overview

Operational and Financial Performance
The table below outlines key operational metrics and the summarised financial performance for Food Ingredients.
Food Ingredients
20202019
Key Operational Metrics
Food Ingredients volume soldMT115,739110,970
Juice concentrate soldlitres 000s6,5446,170
Financial Performance$’000$’000
Food Ingredients revenue173,694155,077
Underlying Food Ingredients EBITDA 23,05113,486
Depreciation and amortisation(1,045)(1,018)
Underlying Food Ingredients EBIT22,00612,468
Food Ingredients EBITDA 21,87232,921
Food Ingredients EBIT20,76431,842
Capital employed72,07079,347
ROCE29%16%
NB: A reconciliation of Underlying to Reported profit measures follows this Divisional Overview section.
201720162018
Operational Summary
Volumes of petfood ingredients sold increased by 4 per cent
to 115,739 MT (2019: 110,970 MT). Part of the increase
in demand can be attributed to a growth in global petfood
demand as a result of increased pet ownership and adoption
rates through the pandemic. However, we believe that other
factors, such as humanisation of pets, have also contributed to
the increase.
To help satisfy this demand, Shelby entered into a new third-
party warehousing and processing agreement with a toll
processor in Dodge City, Kansas. This brings the number of
processing facilities at Shelby to 8 - its own facility in Amarillo,
Texas, plus 7 toll processing facilities throughout the
United States.
Financial Summary
Food Ingredients delivered an exceptional result in 2020 with
increases in both revenue and profitability. This reflected the
benefit of its geographical and protein diversification strategies.
Revenue was $173.7 million, a 12 per cent increase on prior
year (2019: $155.1 million) whilst Underlying EBITDA was
$23.1 million, an increase of 71 per cent (2019: $13.5 million).
Profruit also delivered a strong result, with our share of earnings
being $2.0 million, in line with prior year (2019: $2.0 million).
Divisional Strategy and 2021 Outlook
Food Ingredients took a considerable step towards its long-run
EBITDA target of $25 million and we believe it continues to be
an attractive industry for investment. The global petfood industry
shows no sign of slowing, with its market value expected to
reach US$168.3 billion by 2029, compared to US$97 billion in
2019
1
, a compound annual growth rate of 6 per cent.
Our global strategy is to be a key provider of petfood
ingredients to a wide range of international brands. Whilst
travel restrictions during 2020 limited our ability to both pursue
acquisition opportunities and to develop new supply and offtake
relationships, we continue to actively analyse and review organic
and transactional opportunities to expand our geographical
presence and protein offering.
We are excited for the future of Food Ingredients and the team
are working hard to create further improvements in performance
in 2021 as the division takes advantage of market developments.
We are hopeful that international travel will resume in 2021 to
help move identified opportunities forward.
Profruit volumes also increased compared to last year, with
volumes of 6.5 million litres, a 6 per cent increase (2019:
6.2 million litres). This was due to high fruit brix, good yields
and increased retail demand.
20192020
23.0
27.7
29.0
111.0
115.7
Annual Report - Year Ended 31 December 2020
35
Divisional Overview
Petfood Ingredients Sold (MT 000s)
1
https://www.prnewswire.com/news-releases/global-pet-food-market-to-show-an-impressive-cagr-of-6-from-2019-to-2029-with-valuation-expected-to-reach-us-168-3-bn-finds-
tmr-300999294.html

Logistics
Overview and Divisional Developments
The services of Scales Logistics include:
• Ocean freight services to exporters and importers of perishable products, with offices in Auckland, Christchurch, Tauranga,
Hawke’s Bay and Melbourne.
• Air freight services, including purpose-built chiller and warehousing facilities, based in Christchurch.
Operational and Financial Performance
The key operational metrics and summarised financial performance for the Logistics division for 2020 and 2019 are shown below.
Logistics
20202019
Key Operational Metrics
Ocean freight volumeTEUs35,50239,438
Airfreight volumeMT5,6566,184
Financial Performance$’000$’000
Logistics revenue77,91787,076
Underlying Logistics EBITDA3,4433,302
Depreciation and amortisation(230)(364)
Underlying Logistics EBIT3,2142,938
Logistics EBITDA 4,215 4,058
Logistics EBIT3,392 3,111
Capital employed3,881 3,381
ROCE89%70%
Logistics produced a solid result in a year where activity was
impacted by global supply chain disruptions due to COVID-19
and lockdowns. This caused a decrease in the volumes of both
ocean and air freight managed by the division.
However, the impact of COVID-19 was lessened by the
division’s focus on the essential agribusiness sector. Whilst
revenue was down 11 per cent to $77.9 million (2019:
$87.1 million), Underlying EBITDA was up 4 per cent to
$3.4 million (2019: $3.3 million).
2021 Outlook
It is expected that lower levels of stone fruit exports from the
Otago region, together with continuing disruptions in global
supply chains, will continue to impact Scales Logistics
during 2021.
However, we remain optimistic about the future of the division
and believe there will be opportunities to grow both organically
and through acquisition.
NB: A reconciliation of Underlying to Reported profit measures follows this Divisional Overview section.
Scales Corporation Limited
36
Divisional Overview

37

GroupHorticultureFood IngredientsLogisticsCorporate and eliminations
2020201920202019202020192020201920202019
$’000$’000$’000$’000$’000$’000$’000$’000$’000$’000
Underlying EBITDA53,862 52,699 31,423 39,652 23,051 13,486 3,443 3,302 (4,056)(3,741)
Fair value gain on recognition of investment in joint venture- 9,782 - - - 9,782 - - - -
Gain on disposal of Meateor New Zealand business- 9,782 - - - 9,782 - - - -
Impairment of non-current assets(4,311)- (4,311)- - - - - - -
NZ IFRS 16 Leases10,279 9,535 9,366 8,640 74 73 772 756 67 66
Equity settled employee benefits(698)(866)- - - - - - (698)(866)
Meateor NZ disposal - working capital adjustment(500)- - - (500)- - - - -
Change in fair value gain on apple inventory(802)(332)(802)(332)- - - - - -
Change in gross liability for non-controlling interests(647)(273)106 (71)(753)(201)- - - -
Transaction costs(443)(397)- 21 - - - - (443)(418)
Share based payments- (77)- - - - - - - (77)
Reported EBITDA56,740 79,853 35,781 47,909 21,872 32,921 4,215 4,058 (5,128)(5,035)
Underlying EBIT42,984 42,453 21,899 30,870 22,006 12,468 3,214 2,938 (4,135)(3,824)
Fair value gain on recognition of investment in joint venture- 9,782 - - - 9,782 - - - -
Gain on disposal of Meateor New Zealand business- 9,782 - - - 9,782 - - - -
Impairment of non-current assets(4,311)- (4,311)- - - - - - -
NZ IFRS 16 Leases1,978 1,711 1,779 1,518 11 11 178 173 10 9
Equity settled employee benefits(698)(866)- - - - - - (698)(866)
Meateor NZ disposal - working capital adjustment(500)- - - (500)- - - - -
Change in fair value gain on apple inventory(802)(332)(802)(332)- - - - - -
Change in gross liability for non-controlling interests(647)(273)106 (71)(753)(201)- - - -
Transaction costs(443)(397)- 21 - - - - (443)(418)
Share based payments- (77)- - - - - - - (77)
Reported EBIT37,561 61,783 18,670 32,005 20,764 31,842 3,392 3,112 (5,265)(5,175)
Underlying Net Profit33,764 36,399 15,431 22,206 18,471 11,186 2,284 2,009 (2,422)998
Gain on disposal of Polarcold- 73,002 - - - - - - - 73,002
Interest on settlement of Polarcold, net of tax- (4,131)- - - - - - - (4,131)
Fair value gain on recognition of investment in joint venture- 9,782 - - - 9,782 - - - -
Gain on disposal of Meateor New Zealand business- 9,782 - - - 9,782 - - - -
Impairment of non-current assets(4,311)- (4,311)- - - - - - -
NZ IFRS 16 Leases, net of tax(722)(982)(634)(879)(5)(6)(80)(92)(3)(5)
Equity settled employee benefits(698)(866)- - - - - - (698)(866)
Meateor NZ disposal - working capital adjustment(500)- - - (500)- - - - -
Change in fair value gain on apple inventory(802)(332)(802)(332)- - - - - -
Change in gross liability for non-controlling interests(647)(273)106 (71)(753)(201)- - - -
Transaction costs(443)(357)- 56 - - - - (443)(414)
Share based payments- (77)- - - - - - - (77)
Taxation effect 941 (370)1,432 93 (491)(485)- - - 22
Reported Net Profit26,581 121,577 11,221 21,038 16,722 30,057 2,204 1,917 (3,566)68,564
Reconciliation of Underlying to Reported Profit Measures
The following table provides a reconciliation of Underlying profitability to Reported profitability for the Group and each division.
Scales Corporation Limited
38
Divisional Overview

GroupHorticultureFood IngredientsLogisticsCorporate and eliminations
2020201920202019202020192020201920202019
$’000$’000$’000$’000$’000$’000$’000$’000$’000$’000
Underlying EBITDA53,862 52,699 31,423 39,652 23,051 13,486 3,443 3,302 (4,056)(3,741)
Fair value gain on recognition of investment in joint venture- 9,782 - - - 9,782 - - - -
Gain on disposal of Meateor New Zealand business- 9,782 - - - 9,782 - - - -
Impairment of non-current assets(4,311)- (4,311)- - - - - - -
NZ IFRS 16 Leases10,279 9,535 9,366 8,640 74 73 772 756 67 66
Equity settled employee benefits(698)(866)- - - - - - (698)(866)
Meateor NZ disposal - working capital adjustment(500)- - - (500)- - - - -
Change in fair value gain on apple inventory(802)(332)(802)(332)- - - - - -
Change in gross liability for non-controlling interests(647)(273)106 (71)(753)(201)- - - -
Transaction costs(443)(397)- 21 - - - - (443)(418)
Share based payments- (77)- - - - - - - (77)
Reported EBITDA56,740 79,853 35,781 47,909 21,872 32,921 4,215 4,058 (5,128)(5,035)
Underlying EBIT42,984 42,453 21,899 30,870 22,006 12,468 3,214 2,938 (4,135)(3,824)
Fair value gain on recognition of investment in joint venture- 9,782 - - - 9,782 - - - -
Gain on disposal of Meateor New Zealand business- 9,782 - - - 9,782 - - - -
Impairment of non-current assets(4,311)- (4,311)- - - - - - -
NZ IFRS 16 Leases1,978 1,711 1,779 1,518 11 11 178 173 10 9
Equity settled employee benefits(698)(866)- - - - - - (698)(866)
Meateor NZ disposal - working capital adjustment(500)- - - (500)- - - - -
Change in fair value gain on apple inventory(802)(332)(802)(332)- - - - - -
Change in gross liability for non-controlling interests(647)(273)106 (71)(753)(201)- - - -
Transaction costs(443)(397)- 21 - - - - (443)(418)
Share based payments- (77)- - - - - - - (77)
Reported EBIT37,561 61,783 18,670 32,005 20,764 31,842 3,392 3,112 (5,265)(5,175)
Underlying Net Profit33,764 36,399 15,431 22,206 18,471 11,186 2,284 2,009 (2,422)998
Gain on disposal of Polarcold- 73,002 - - - - - - - 73,002
Interest on settlement of Polarcold, net of tax- (4,131)- - - - - - - (4,131)
Fair value gain on recognition of investment in joint venture- 9,782 - - - 9,782 - - - -
Gain on disposal of Meateor New Zealand business- 9,782 - - - 9,782 - - - -
Impairment of non-current assets(4,311)- (4,311)- - - - - - -
NZ IFRS 16 Leases, net of tax(722)(982)(634)(879)(5)(6)(80)(92)(3)(5)
Equity settled employee benefits(698)(866)- - - - - - (698)(866)
Meateor NZ disposal - working capital adjustment(500)- - - (500)- - - - -
Change in fair value gain on apple inventory(802)(332)(802)(332)- - - - - -
Change in gross liability for non-controlling interests(647)(273)106 (71)(753)(201)- - - -
Transaction costs(443)(357)- 56 - - - - (443)(414)
Share based payments- (77)- - - - - - - (77)
Taxation effect 941 (370)1,432 93 (491)(485)- - - 22
Reported Net Profit26,581 121,577 11,221 21,038 16,722 30,057 2,204 1,917 (3,566)68,564
Annual Report - Year Ended 31 December 2020
39
Divisional Overview

Leadership Profiles
Team
effort

Tim was elected to the Board in 2014, having been
appointed Chair of Scales’ Horticulture division in 2012.
He has been involved in agribusiness for over 40 years and
was CEO of Zespri International from 2003 to 2007. Tim is
currently: Chair of The Nutritious Kiwifruit Company Limited,
which is a consortium of New Zealand kiwifruit suppliers
selling under a new single brand, based around nutrition
and health, on the Australian market; Director of Prevar
Limited, an Australian and New Zealand joint venture apple
and pear industry company, supporting the development
and commercialisation of new apple and pear varieties;
Director of Nagambie Healthcare, a community hospital
and aged care facility, based in regional Victoria, Australia
and President of Nagambie Lakes Tourism and Commerce
Incorporated. Tim is a member of Scales’ Nominations and
Remuneration Committee.
Board of Directors (as at 19 March 2021)
Andy joined Scales in 2007 and became Managing Director
in 2011. Prior to joining Scales he had a 20 year career in
banking, with his final role being Head of Corporate at
Westpac New Zealand. Andy has overall responsibility for the
strategic direction and day-to-day management of Scales. In
addition to his directorships of the Group, Andy is currently
the Chair of Akaroa Salmon Limited, Primary Collaboration
New Zealand Limited and Primary Collaboration New Zealand
(Shanghai) Co. Limited, and Rabobank New Zealand Limited.
Andy is a member of Scales’ Finance and Treasury Committee
and Scales’ Health & Safety and Sustainability Committee.
Nick was elected to the Board in 2014, having been appointed
a Director of both Scales’ Storage & Logistics division and
Meateor in 2012. Nick was previously the Managing Director,
and was one of the founding shareholders of Hellers Limited,
New Zealand’s largest bacon, ham and small goods company.
Nick is a shareholder and Director of several private companies,
and is Deputy Chair of the Canterbury Hockey Association.
Nick is Chair of Scales’ Health & Safety and Sustainability
Committee and is a member of Scales’ Audit and Risk
Management Committee.
Mark was elected to the Board in 2011. He is a founding
partner of Direct Capital. Mark has a background in private
equity, specialising in portfolio management with a focus
on strategy, growth and capital funding. Mark is currently a
Director of a number of Direct Capital entities. Mark is also a
Director of Evergreen Partners Limited. Mark is Chair of Scales’
Nominations and Remuneration Committee and of Scales’
Finance and Treasury Committee and is a member of Scales’
Audit and Risk Management Committee.
Tim Goodacre,
Non-Executive
Independent Chair
Nick Harris,
Non-Executive
Independent Director
Andrew (Andy)
Borland,
Executive Director
Mark Hutton,
Non-Executive
Independent Director
Annual Report - Year Ended 31 December 2020
41
Leadership Profiles

Board of Directors (continued)
Alan was elected to the Board in 2014. Alan was the
President of the International Cricket Council between 2012
and 2014 and is currently; Chair of the Basin Reserve Trust;
a Director of Oceania Healthcare (NZ) Limited, Skellerup
Holdings Limited and a number of private companies. Alan
has an extensive background in the accounting and finance
field and is a former National Chair of KPMG. He was made
a Companion of the New Zealand Order of Merit (CNZM)
in 2013 for services to cricket and business. Alan is Chair of
Scales’ Audit and Risk Management Committee.
Tomakin was appointed to the Board in 2019. He is a
Director of China Resources Ng Fung Limited, which holds a
15.13% shareholding in the Company, and is also the Vice
President, Chief Financial Officer and Company Secretary
of China Resources Enterprise, Limited. Tomakin joined the
China Resources Group in 2008, and holds both a Business
Administration degree from the Chinese University of Hong
Kong, and a Master of Business Administration degree
from the University of Manchester. Tomakin is a Director
of New Zealand King Salmon Investments Limited. He has
extensive experience in internal and external auditing, finance
and accounting, mergers and acquisitions, regulatory and
compliance, and as a company secretary.
Nadine was appointed to the Board in 2019. Nadine
has extensive horticulture and wider primary industry
management experience from a number of previous roles,
including as the former CEO of Oha Honey LP. Nadine also
brings experience from a wide variety of governance and
advisory roles, including as a former member of the Primary
Sector Council, and as the former Chair of New Zealand
Apples & Pears Incorporated. Nadine is a member of Scales’
Health & Safety and Sustainability Committee.
Alan Isaac,
Non-Executive
Independent Director
Nadine Tunley,
Non-Executive
Independent Director
Lai Po Sing, Tomakin,
Non-Executive Director
Scales Corporation Limited
42
Leadership Profiles

Andy Borland, Managing Director
Andy joined Scales in 2007 and became Managing Director in
2011. Andy’s full biography is set out in the previous section.
Hamish Davis, Managing Director Fern Ridge
Hamish joined Fern Ridge in 2001, becoming Managing
Director in 2008 following supply management and sales roles.
He has over 30 years’ experience in the growing and post-
harvest sectors of the apple industry, and remains very active in
export sales for the company.
Brett Frankel, President Shelby Foods
Brett established United States based Shelby Foods in 2007,
and has been its President since inception. Brett has over 20
years’ experience in petfood, having had a senior procurement
role prior to starting Shelby. He also represents the third
generation of family involvement in the sector, following in the
footsteps of both his father and grandfather.
Tim Harty, General Manager Meateor
Pet Foods
Tim was appointed General Manager at the inception of the
JV with Alliance in 2019. Tim has had a 20 year career in the
export meat industry in marketing and operational roles, both
in New Zealand and overseas.
Steve Kennelly, Chief Financial Officer
Steve has been with Scales since 1993 in a variety of
accounting and financial roles. As CFO, Steve is responsible for
finance, funding, legal, company secretarial and information
technology. Steve is a member of Chartered Accountants
Australia and New Zealand.
Karen Morrish, Group Health & Safety,
Compliance and Sustainability Manager
Karen was appointed to this Group role in 2017. Prior to that
Karen was the Health & Safety and Compliance Manager for
Mr Apple, where she has worked for 16 years. In 2019 Karen
also took on the role as a Director of New Zealand Apples &
Pears Incorporated.
Chantelle Ramage, General Manager Profruit
Chantelle has been with Profruit for 14 years, including 12
as General Manager. Prior to that Chantelle held Production
Manager and Technical Manager roles with the company.
Chantelle graduated from Lincoln University with a Bachelor of
Science, majoring in Food.
Kent Ritchie, CEO Scales Logistics
Kent joined Scales in 1998, and has spent over 30 years in the
shipping industry. He has been involved in setting up shipping
services from New Zealand, has experience in all aspects of
the transport industry and has led Scales’ expansion into the
logistics arena.
John Sainsbury, CEO Meateor Group
John has been with Meateor in various management roles
for the last 19 years. Prior to that, John worked in senior
management, marketing and operational roles in the United
States. John was appointed CEO of Meateor Foods in March
2015, and CEO of Meateor Group during 2019.
Andrew van Workum, CEO Mr Apple
Andrew has worked in the apple industry for over 30 years. He
joined Mr Apple at its inception in 2001 and prior to that was
General Manager of Mr Apple’s predecessor, Grocorp Pacific
Limited, where he worked for 16 years. He has extensive
experience in the production aspects of the apple industry, and
was previously a Director of Pipfruit New Zealand.
Management Profiles
Andrew van Workum,
CEO Mr Apple,
outside the new Mr Apple
Coolstore at Whakatu.
43
Annual Report - Year Ended 31 December 2020
Leadership Profiles

Financial
Statements

Contents
Comprehensive income 46
The income earned and operating expenditure incurred
by the Scales Group during the financial year (profit or
loss) followed by the other comprehensive income that is
taken to reserves in equity.
Changes in equity 48
The opening balance, details of movements during
the year and the balance of each component of
shareholders’ equity at the end of the financial year.
Financial position 49
The Scales Group assets, liabilities and equity at the end
of the financial year.
Cash flows 51
Cash generated and used in the operating, investing and
financing activities of the Scales Group.
Notes to the Financial Statements 54
A. Segment information 56
B. Financial performance 58
B1. Revenue
B2. Cost of sales, administration and
operating expenses
B3. Other income and losses
B4. Finance cost
B5. Taxation
B6. Foreign currency transactions
C. Key assets 63
C1. Property, plant and equipment
C2. Unharvested agricultural produce
C3. Investments accounted for using the
equity method
C4. Goodwill
C5. Inventories
C6. Impairment of assets
D. Capital funding 70
D1. Share capital
D2. Reserves
D3. Dividends
D4. Imputation credit account
D5. Earnings per share
E. Financial assets and liabilities 74
E1. Trade and other receivables
E2. Other financial assets
E3. Trade and other payables
E4. Borrowings
E5. Other financial liabilities
E6. Interest rate risk
E7. Foreign currency risk
E8. Categories of financial instruments
E9. Maturity profile of financial liabilities
F. Group structure 81
F1. Subsidiary companies
F2. Assets held for sale
G. Other 82
G1. Capital commitments
G2. Leases
G3. Related party disclosures
G4. Contingent liability
G5. Events occurring after balance date
G6. COVID-19
Annual Report - Year Ended 31 December 2020
45
Financial Statements

20202019
NOTE$’000$’000
Continuing operations
RevenueB1 470,709 484,609
Cost of salesB2(366,800)(383,126)
103,909 101,483
Administration and operating expensesB2(44,382)(43,965)
Revaluation of apple trees and buildingsC1(4,311)-
Share of profit of entities accounted for using the equity methodC32,224 2,997
Fair value gain on recognition of investment in joint venture- 9,782
Gain on disposal of Meateor New Zealand business- 9,782
Other incomeB31,645 421
Other lossesB3(2,345)(647)
EBITDA56,740 79,853
Amortisation (584)(592)
DepreciationC1(10,294)(9,654)
Depreciation of right of use assetG2(8,301)(7,824)
EBIT37,561 61,783
Finance revenue2,584 2,834
Finance costB4(1,915)(3,549)
Finance cost of lease liabilityG2(2,981)(3,075)
PROFIT BEFORE INCOME TAX EXPENSE FROM CONTINUING OPERATIONS35,249 57,993
Income tax expense B5(8,668)(9,418)
PROFIT FOR THE YEAR FROM CONTINUING OPERATIONS26,581 48,575
Profit from discontinued operations (net of tax)- 73,002
PROFIT FOR THE YEAR26,581 121,577
Profit for the year from continuing operations is attributable to:
Equity holders of the Company21,025 45,000
Non-controlling interests 5,556 3,575
26,581 48,575
Profit from discontinued operations is fully attributable to equity holders of the Company.
EARNINGS PER SHARE ATTRIBUTABLE TO EQUITY HOLDERS
OF THE COMPANY:
Basic earnings per share (cents):
Continuing operations D515.0 32.1
Discontinued operationsD5- 52.1
TotalD515.0 84.2
Diluted earnings per share (cents):
Continuing operationsD514.9 32.0
Discontinued operationsD5- 51.9
Total D514.9 83.9
The notes to the financial statements on pages 54 to 85 form part of and should be read in conjunction with this statement.
46
Scales Corporation Limited
Financial Statements
Consolidated Statement of Comprehensive Income
for the year ended 31 December 2020

20202019
NOTE$’000$’000
OTHER COMPREHENSIVE INCOME
Items that may be reclassified subsequently to profit or loss:
Gain on cash flow hedges20,861 6,496
Income tax relating to cash flow hedges (5,841)(1,819)
Share of other comprehensive income of joint ventures C3 708 209
Income tax relating to share of other comprehensive income of joint ventures(198)(58)
Foreign exchange (loss) on translating foreign operations (784)(125)
14,746 4,703
Items that will not be reclassified to profit or loss:
Revaluation of land and buildings 9,133 11,117
Income tax relating to buildings(448)(818)
Revaluation of apple trees(31)1,431
Income tax relating to apple trees9 (401)
Remeasurement of net defined benefit liability(440)-
Income tax relating to remeasurement of net defined benefit liability67 -
8,290 11,329
OTHER COMPREHENSIVE INCOME FOR THE YEAR23,036 16,032
TOTAL COMPREHENSIVE INCOME FOR THE YEAR49,617 137,609
Total comprehensive income for the year attributable to:
Equity holders of the Company44,374 134,034
Non-controlling interests5,243 3,575
49,617 137,609
The notes to the financial statements on pages 54 to 85 form part of and should be read in conjunction with this statement.
Annual Report - Year Ended 31 December 2020
47
Financial Statements
Consolidated Statement of Comprehensive Income (continued)
for the year ended 31 December 2020

The notes to the financial statements on pages 54 to 85 form part of and should be read in conjunction with this statement.
48
Scales Corporation Limited
Financial Statements

Share
capitalReserves
Retained
earnings
Attributable
to owners
of the
Company
Non-
controlling
interestsTotal
NOTE$’000$’000$’000$’000$’000$’000
Balance at 1 January 201994,184 71,999 80,109 246,292 3,581 249,873
Profit for the year- - 118,002 118,002 3,575 121,577
Other comprehensive income for the year- 16,032 - 16,032 - 16,032
Total comprehensive income for the year- 16,032 118,002 134,034 3,575 137,609
Reclassification of revaluation reserveD2- (25,912)25,912 - - -
Recognition of share-based paymentsD2- 866 - 866 - 866
Shares fully vestedD1, D21,089 (474)(139)476 - 476
DividendsD3- - (26,654)(26,654)(3,167)(29,821)
Balance at 31 December 201995,273 62,511 197,230 355,014 3,989 359,003
Profit for the year- - 21,025 21,025 5,556 26,581
Other comprehensive income for the year- 23,349 - 23,349 (313)23,036
Total comprehensive income for the year- 23,349 21,025 44,374 5,243 49,617
Reclassification of revaluation reserveD2- 1,093 (1,093)- - -
Reclassification of pension reserveD2- (341)341 - - -
Recognition of share-based paymentsD2- 698 - 698 - 698
Shares fully vestedD1, D21,098 (536)(165)397 - 397
DividendsD3- - (26,716)(26,716)(4,594)(31,310)
Balance at 31 December 202096,371 86,774 190,622 373,767 4,638 378,405
Consolidated Statement of Changes in Equity
for the year ended 31 December 2020

The notes to the financial statements on pages 54 to 85 form part of and should be read in conjunction with this statement.
Annual Report - Year Ended 31 December 2020
49
Financial Statements
20202019
NOTE$’000$’000
EQUITY
Share capitalD196,371 95,273
ReservesD286,774 62,511
Retained earningsD2190,622 197,230
Equity attributable to Scales Corporation Limited shareholders373,767 355,014
Equity attributable to non-controlling interests4,638 3,989
TOTAL EQUITY378,405 359,003
CURRENT ASSETS
Cash and bank balances47,418 18,632
Term deposits104,632 142,000
Trade and other receivablesE119,452 20,593
Current tax assets- 164
Other financial assetsE212,688 4,571
Unharvested agricultural produceC224,022 21,619
InventoriesC525,805 26,422
Prepayments3,899 3,482
237,916 237,483
Assets held for saleF22,550 -
TOTAL CURRENT ASSETS240,466 237,483
NON-CURRENT ASSETS
Property, plant and equipmentC1181,311 165,741
Investments accounted for using the equity methodC326,154 24,973
GoodwillC441,905 43,784
Other financial assetsE218,143 7,117
Computer software354 807
Right of use assetG277,877 78,775
TOTAL NON-CURRENT ASSETS345,744 321,197
TOTAL ASSETS586,210 558,680
Consolidated Statement of Financial Position
as at 31 December 2020

50
Scales Corporation Limited
Financial Statements
20202019
NOTE$’000$’000
CURRENT LIABILITIES
Bank overdrafts1,384 1,188
Trade and other payablesE325,117 19,843
Dividend declaredD313,359 13,328
BorrowingsE4860 -
Current tax liabilities1,593 2,842
Other financial liabilitiesE54,300 4,377
Lease liabilityG210,053 9,427
TOTAL CURRENT LIABILITIES56,666 51,005
NON-CURRENT LIABILITIES
BorrowingsE452,199 54,551
Deferred tax liabilitiesB525,596 19,442
Defined benefit plan net liability632 -
Other financial liabilitiesE52,522 3,966
Lease liabilityG270,190 70,713
TOTAL NON-CURRENT LIABILITIES151,139 148,672
TOTAL LIABILITIES207,805 199,677
NET ASSETS378,405 359,003

Consolidated Statement of Financial Position (continued)
as at 31 December 2020
The notes to the financial statements on pages 54 to 85 form part of and should be read in conjunction with this statement.

Annual Report - Year Ended 31 December 2020
51
Financial Statements
Consolidated Statement of Cash Flows
for the year ended 31 December 2020
20202019
NOTE$’000$’000
CASH FLOWS FROM OPERATING ACTIVITIES
Cash was provided from:
Receipts from customers469,559 511,371
Dividends received1,509 1,517
Interest received4,042 791
475,110 513,679
Cash was disbursed to:
Payments to suppliers and employees(407,074)(442,424)
Interest paid(4,896)(6,624)
Income tax paid(9,916)(8,532)
(421,886)(457,580)
NET CASH PROVIDED BY OPERATING ACTIVITIES53,224 56,099
CASH FLOWS FROM INVESTING ACTIVITIES
Cash was provided from:
Proceeds from maturing term deposits37,368 -
Advances repaid382 722
Proceeds from sale of storage businesses- 148,882
Proceeds from sale of Meateor New Zealand businessC3- 15,000
Sale of property, plant and equipment and computer software298 57
38,048 164,661
Cash was applied to:
Purchase of property, plant and equipment(24,237)(16,313)
Purchase of computer software(131)(495)
Purchase of financial instruments- (497)
Investment in term deposits- (142,000)
(24,368)(159,305)
NET CASH PROVIDED BY INVESTING ACTIVITIES13,680 5,356
CASH FLOWS FROM FINANCING ACTIVITIES
Cash was provided from:
Proceeds from seasonal and other facility borrowingsE43,955 79,000
3,955 79,000
The notes to the financial statements on pages 54 to 85 form part of and should be read in conjunction with this statement.

52
Scales Corporation Limited
Financial Statements
20202019
NOTE$’000$’000
Cash was applied to:
Dividends paid(26,685)(26,625)
Dividends paid to non-controlling interests(4,594)(3,167)
Repayments of lease liabilities(7,300)(6,459)
Repayments of seasonal facility borrowingsE4(3,000)(81,000)
Repayments of term facility borrowingsE4- (10,000)
Repayments of related party borrowings- (1,329)
(41,579)(128,580)
NET CASH USED IN FINANCING ACTIVITIES(37,624)(49,580)
NET INCREASE IN NET CASH29,280 11,875
Net foreign exchange difference(690)(201)
Cash and cash equivalents at the beginning of the year17,444 5,770
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR46,034 17,444
Represented by:
Cash and bank balances 47,418 18,632
Bank overdrafts(1,384)(1,188)
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR46,034 17,444
Consolidated Statement of Cash Flows (continued)
for the year ended 31 December 2020
The notes to the financial statements on pages 54 to 85 form part of and should be read in conjunction with this statement.

Annual Report - Year Ended 31 December 2020
53
Financial Statements
Andy Borland, Managing Director Tim Goodacre, Chair
Consolidated Statement of Cash Flows (continued)
for the year ended 31 December 2020
20202019
NOTE$’000$’000
NET CASH GENERATED BY OPERATING ACTIVITIES
Reconciliation of profit for the year to net cash generated by operating activities:
Profit for the year 26,581 121,577
Non-cash items:
Depreciation (including on right-of-use asset)18,595 17,478
Revaluation of apple trees and buildings4,311 -
Amortisation 584 592
Share of equity accounted results(2,224)(2,997)
Hedging instruments(205)639
Loss (gain) on disposal of property, plant and equipment62 (57)
Share-based payments698 1,000
Change in gross liability on put options647 273
Deferred tax(203)941
Gain on disposal of storage businesses- (68,131)
Gain on disposal of Meateor New Zealand businessC3- (9,782)
Fair value gain on recognition of investment in joint ventureC3- (9,782)
Items classified as investing and financing activities:
Dividends received from equity accounted entities1,500 1,500
Changes in net assets and liabilities:
Trade and other receivables764 (579)
Unharvested agricultural produce(2,403)(1,072)
Inventories 28 3,540
Prepayments(426)(975)
Trade and other payables5,960 (235)
Current tax assets and liabilities(1,045)2,169
NET CASH PROVIDED BY OPERATING ACTIVITIES53,224 56,099
Statement of Cash Flows
For the purpose of the statement of cash flows, cash and cash equivalents include cash and bank balances and bank overdrafts.

The following terms are used in the statement of cash flows:
Operating activities are the principal revenue producing activities of the Group and other activities that are not investing or
financing activities.
Investing activities are the acquisition and disposal of long-term assets and other investments not included in
cash equivalents.
Financing activities are activities that result in changes in the size and composition of the contributed equity and borrowings of
the Group.
For and on behalf of the Board of Directors who authorised the issue of the financial statements on 25 February 2021.
The notes to the financial statements on pages 54 to 85 form part of and should be read in conjunction with this statement.

The notes to the financial statements include information which is considered relevant and material to assist the
reader in understanding the financial performance and financial position of the Scales Corporation Limited Group
(Scales or the Group). Information is considered relevant and material if:
• the amount is significant because of its size and nature;
• it is important for understanding the results of Scales;
• it helps to explain changes in Scales’ business; or
• it relates to an aspect of Scales’ operations that is important to future performance.
Scales Corporation Limited (the Company) is a for-profit entity domiciled and registered under the Companies Act 1993 in
New Zealand. It is an FMC reporting entity for the purposes of the Financial Markets Conduct Act 2013. The Group consists of Scales
Corporation Limited, its subsidiaries and joint ventures. The principal activities of the Group are to grow apples, provide logistics
services, export products, manufacture and trade food ingredients, provide insurance services to companies within the Group and
operate processing facilities.
The financial statements have been prepared:
• in accordance with Generally Accepted Accounting Practice (GAAP), International Financial Reporting Standards (IFRS), the
New Zealand equivalents to International Financial Reporting Standards (NZ IFRS) and other applicable financial reporting
standards, as appropriate for a Tier 1 for-profit entity;
• in accordance with the requirements of the Financial Markets Conduct Act 2013;
• in accordance with accounting policies that are consistent with those applied in the previous year;
• on the basis of historical cost, except for certain assets and financial instruments that are measured at fair values; and
• in New Zealand dollars with all values rounded to the nearest thousand dollars.
Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation
technique. In estimating the fair value of an asset or liability, the Group takes into account the characteristics of the asset or liability if
market participants would take those characteristics into account when pricing the asset or liability at the measurement date.
For financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which the
inputs to the fair value measurements are observable. The levels are described as:
• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the
measurement date;
• Level 2 inputs are inputs, other than quoted prices within Level 1, that are observable for the asset or liability, either directly or
indirectly; and
• Level 3 inputs are unobservable inputs for the asset or liability.
Key judgements and estimates
In the process of applying the Group’s accounting policies and the application of financial reporting standards, Scales has made a
number of judgements and estimates. The estimates and underlying assumptions are based on historical experience and various
other factors that are considered to be appropriate under the circumstances.
Actual results may differ from these estimates.
Judgements and estimates which are considered material to understanding the performance of Scales are explained in the
following notes:
• Apple trees in note C1;
• Unharvested agricultural produce in note C2.
• Assessment of Group invesment in Meateor Pet Foods Limited Partnership for impairment in note C3.
54
Scales Corporation Limited
Financial Statements
Notes to the Financial Statements
for the year ended 31 December 2020

Annual Report - Year Ended 31 December 2020
55
Financial Statements
Basis of consolidation
The Group financial statements incorporate the financial statements of the Company and its subsidiaries (being entities controlled by
Scales Corporation Limited), and the equity accounted result, assets and liabilities of the joint ventures.
The financial statements of members of the Group, are prepared for the same reporting period as the parent company, using
consistent accounting policies.
In preparing the Group financial statements, all material intra-group transactions, balances, income, expenses and cash flows have
been eliminated. Subsidiaries are consolidated from the date on which control is obtained to the date on which control is lost.
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.
Adoption of new and revised standards and interpretations; standards and Interpretations issued but not yet effective
All mandatory amendments and interpretations have been adopted in the current year. None had a material impact on these
financial statements.
The Group has reviewed all Standards, Interpretations and Amendments to existing Standards in issue not yet effective and does not
expect these to have a material effect on the financial statements of the Group.

56
Scales Corporation Limited
Financial Statements
A. Segment Information
This section explains the financial performance of the operating segments of Scales, providing additional information
about individual segments, including:
• total segment revenue and revenue from external customers;
• segment profit before income tax; and
• total segment assets and liabilities.
Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker, being the Managing Director. The Managing Director monitors the operating performance of each segment for the purpose
of making decisions on resource allocation and strategic direction. Inter-segment pricing is determined on an arm’s length basis.
Segment results include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
No single external customer’s revenue accounts for 10% or more of the Group’s revenue.
The Group comprises the following operating segments:
Food Ingredients: processing and marketing of food ingredients such as pet food ingredients and juice concentrate. Meateor Foods
Limited, Meateor Foods Australia Pty Limited, Meateor Group Limited, Meateor US LLC, Shelby JV LLC Group (Shelby Cold Storage
LLC, Shelby Exports Inc, Shelby Foods LLC, Shelby JV LLC, Shelby Properties LLC, Shelby Trucking LLC), Meateor GP Limited, Meateor
Pet Foods Limited Partnership and Profruit (2006) Limited.
Horticulture: orchards, fruit packing and marketing. Mr Apple New Zealand Limited, New Zealand Apple Limited, Fern Ridge Produce
Limited and Longview Group Holdings Limited.
Logistics: logistics services. Scales Logistics Limited and Scales Logistics Australia Pty Ltd.
Other: Scales Corporation Limited, Geo. H. Scales Limited, Scales Employees Limited, Scales Holdings Limited and Selacs
Insurance Limited.
Horticulture
Food
IngredientsLogisticsOtherEliminationsTotal
$’000$’000$’000$’000$’000$’000
2020
Total segment revenue245,984 173,694 77,917 3,784 (30,670)470,709
Inter-segment revenue- - (28,082)(2,588)30,670 -
Revenue from external customers245,984 173,694 49,835 1,196 - 470,709
Gain (loss) on sale of non-current assets46 - (108)- - (62)
Share of profit of entities accounted for
using the equity method
- 2,224 - - - 2,224
Revaluation of apple trees and buildings(4,311)- - - - (4,311)
EBITDA35,781 21,872 4,215 (5,128)- 56,740
Amortisation expense(475)- (43)(66)- (584)
Depreciation expense(9,049)(1,045)(187)(13)- (10,294)
Depreciation of right of use asset(7,586)(63)(594)(58)- (8,301)
Finance revenue1 1 - 2,582 - 2,584
Finance costs(36)(32)(28)(1,819)- (1,915)
Finance cost of lease liability(2,660)(18)(289)(14)- (2,981)
Segment profit (loss) before income tax15,976 20,715 3,074 (4,516)- 35,249

Annual Report - Year Ended 31 December 2020
57
Financial Statements
Segment Reporting (continued)
Horticulture
Food
IngredientsLogisticsOtherEliminationsTotal
$’000$’000$’000$’000$’000$’000
Segment assets329,055 103,793 17,867 135,495 - 586,210
Segment liabilities122,838 19,082 11,870 54,015 - 207,805
Segment carrying value of investment
accounted for using the equity method
- 26,154 - - - 26,154
Segment acquisition of property, plant and
equipment and computer software
23,800 471 92 6 - 24,369
2019 (continuing operations)
Total segment revenue264,782 155,077 87,076 3,461 (25,787)484,609
Inter-segment revenue- - (22,948)(2,839)25,787 -
Revenue from external customers264,782 155,077 64,128 622 - 484,609
Gain on sale of non-current assets45 - - 1 - 46
Share of profit of entity accounted for
using the equity method
- 2,997 - - - 2,997
EBITDA47,909 32,921 4,058 (5,035)- 79,853
Amortisation expense(486)(1)(36)(69)- (592)
Depreciation expense(8,296)(1,016)(328)(14)- (9,654)
Depreciation of right of use asset(7,122)(62)(583)(57)- (7,824)
Finance revenue19 10 3 2,802 - 2,834
Finance costs(16)(23)(33)(3,477)- (3,549)
Finance cost of lease liability(2,739)(20)(301)(15)- (3,075)
Segment profit (loss) before income tax29,269 31,809 2,780 (5,865)- 57,993
Segment assets293,249 101,091 18,619 145,721 - 558,680
Segment liabilities112,426 11,110 12,269 63,872 - 199,677
Segment carrying value of investment
accounted for using the equity method
- 24,973 - - - 24,973
Segment acquisition of property, plant and
equipment and computer software
15,002 191 470 10 - 15,673
New ZealandAustraliaUSATotal
20202019202020192020201920202019
$’000$’000$’000$’000$’000$’000$’000$’000
Property, plant and
equipment
177,517 161,102 40 49 3,754 4,590 181,311 165,741
Investments
accounted for using
the equity method
26,154 24,973 - - - - 26,154 24,973
Goodwill16,188 16,188 - - 25,717 27,596 41,905 43,784
Computer software354 807 - - - - 354 807
Right of use asset77,294 78,080 192 215 391 480 77,877 78,775
Non-current assets other than financial instruments by geographical location

58
Scales Corporation Limited
Financial Statements
B. Financial Performance
This section explains the financial performance of Scales, providing additional information about individual items in the
statement of comprehensive income, including:
• accounting policies, judgements and estimates that are relevant for understanding items recognised in the statement of
comprehensive income; and
• analysis of Scales’ performance for the year by reference to key areas including revenue, expenses and taxation.
B1. Revenue
2020
$’000
2019
$’000
By nature:
Revenue from the sale of goods402,194 390,855
Revenue from the rendering of services64,357 90,280
Fees and commission59 89
Net foreign exchange loss(730)(127)
Rental revenue4,829 3,512
470,709 484,609
By market:
New Zealand 81,549 107,465
Asia128,582 153,301
Europe75,041 64,621
North America184,894 154,994
Other643 4,228
470,709 484,609
By segment and type:
Horticulture - sale of agricultural produce229,033 237,584
Horticulture - agricultural produce related services12,133 23,695
Horticulture - other4,818 3,503
Food ingredients - sale of pet food ingredients171,144 152,963
Food ingredients - other2,550 2,114
Logistics services49,835 64,128
Other1,196 622
470,709 484,609
Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected on behalf
of third parties. The Group recognises revenue when it transfers control of a product or service to a customer.

Annual Report - Year Ended 31 December 2020
59
Financial Statements
B1. Revenue (continued)
Sale of agricultural produce
The Group sells apples to more than 160 customers in 40 countries. Sales-related quality claim provisions are recorded in accordance
with NZ IAS 37 Provisions, Contingent Liabilities and Contingent Assets. Revenue is recognised when control of the goods has
transferred, being when the goods have been shipped to the customer (“outright sales”) or when the goods have been sold by
the customer (“consignment sales”). In addition, the apple season finishes before the end of the calendar year, with performance
obligations under both sales types satisfied for all sales made during that season.
Outright sales
Following shipment, revenue is recognised when the customer obtains control as it has full discretion over the manner of distribution
and price to sell the goods, has the primary responsibility when onselling the goods and bears the risks of loss in relation to the
goods. A receivable is recognised by the Group when it loses control, which is when the goods are delivered on the ship at the port
of shipment as this represents the point in time at which the right to consideration becomes unconditional, as only the passage of
time is required before the payment is due. Terms of payment are up to 45 days on arrival.
Consignment sales
Revenue is recognised by the Group when it loses control, which is when the goods are confirmed to be on-sold to the ultimate
customer as this represents the point in time at which the right to consideration becomes unconditional, as only the passage of time
is required before the payment is due. Terms of payment are immediate upon on-sale.
Sale of petfood ingredients
The Group sells petfood ingredients to a number of international and domestic customers. Revenue is recognised when control of
the goods has transferred, being when the goods have been delivered to the customer (“delivered to destination sales”) or when
shipped to the customer (“outright sales”). Terms of payments are up to 120 days.
Delivered to destination sales
Following delivery, revenue is recognised when the customer obtains control as it has full discretion over the manner of distribution
and price to sell the goods, has the primary responsibility when onselling the goods and bears the risks of loss in relation to the
goods. A receivable is recognised by the Group when it loses control, which is when the goods are delivered to the destination
named by the customer as this represents the point in time at which the right to consideration becomes unconditional, as only the
passage of time is required before the payment is due.
Outright sales
Same as above under “Sale of agricultural produce - outright sales”.
Agricultural produce related services
The Group provides a number of agricultural produce related services to external apple growers, including packaging, cartage, export
documentation and export services. Each of those services is considered to be a distinct service as it is both regularly supplied by the
Group to customers on a stand-alone basis and is available for customers from other providers in the market.
A receivable is recognised by the Group when the service performance has been completed and the performance obligation is
satisfied, as this represents the point in time at which the right to consideration becomes unconditional, as only the passage of time
is required before the payment is due. Terms of payment are up to 45 days.
Logistics services
The Group provides marine and air logistics services to domestic customers. Revenue is recognised by the Group at a point in time,
which is when the shipment is organised and the goods are on the ship or the aeroplane. The performance obligation is satisfied
at the point in time at which the right to consideration becomes unconditional, as only the passage of time is required before the
payment is due. Terms of payments are up to 60 days.
B2. Cost of Sales, Administration and Operating Expenses
20202019
$’000$’000
Auditor’s remuneration:
Deloitte Limited (New Zealand):
Audit of the financial statements:
Audit of the annual financial statements175 168
Review of interim financial statements 48 45
Other assurance services:
Audit of solvency certificate for Selacs Insurance Limited6 6
Sheehan & Company CPA, PC (United States):
Group reporting audit92 69
Review of subsidiary financial statements31 30

60
Scales Corporation Limited
Financial Statements
B2. Cost of Sales, Administration and Operating Expenses (continued)
20202019
$’000$’000
Bad debts incurred (recovered)251 (168)
Change in fair value adjustment to unharvested agricultural produce802 332
Change in inventories252 3,540
Direct expenses58,852 65,987
Directors' fees596 555
Donations45 13
Electricity2,778 2,774
Employee benefits expense:
Post employment benefits - defined contribution plans1,254 1,401
Post employment benefits - defined benefit plans508 409
Salaries, wages and related benefits79,809 73,754
Other employee benefits698 743
Grower payments49,017 62,376
Insurance3,609 3,589
Management fees48 97
Materials and consumables112,758 102,877
Ocean and air freight72,056 81,154
Operating lease expenses2,960 2,089
Packaging19,225 18,940
Provision for write-down of inventories377 1,168
Repairs and maintenance4,935 5,143
411,182 427,091
Disclosed as:
Cost of sales366,800 383,126
Administration and operating expenses44,382 43,965
411,182 427,091

Employee benefits
An accrual is made for benefits due to employees in respect of wages and salaries, annual leave and long service leave when it is
probable that settlement will be required and they are capable of being measured reliably. Accruals are measured at their nominal
values using the remuneration rate expected to apply at the time of settlement.
Contributions to defined contribution plans are recognised as an expense when employees have rendered service entitling them to
the contributions.
The costs relating to shares issued in accordance with the Senior Executive Share Scheme are explained in note D2.
B3. Other Income and Losses
2020 2019
$’000$’000
Dividends9 1
(Loss) gain on disposal of property, plant and equipment(62)46
Reinsurance income (Note G4)1,636 374
Insurance claims expense paid (Note G4)(1,636)(374)
Remeasurement of gross liability to non-controlling interest(647)(273)
(700)(226)
Disclosed as:
Other income1,645 421
Other losses(2,345)(647)
(700)(226)

Annual Report - Year Ended 31 December 2020
61
Financial Statements
B4. Finance Cost
20202019
$’000$’000
Interest on loans1,867 3,298
Other interest12 123
Bank facility fees 36 128
1,915 3,549
Finance costs consist of interest and other costs incurred in connection with the borrowing of funds. Interest expense is accrued on a
time basis using the effective interest method.
B5. Taxation
Income tax recognised in profit or loss
Income tax expense comprises:
Current tax expense from continuing operations8,827 8,795
Current tax expense from discontinued operations- 2,483
Total current tax expense8,827 11,278
Adjustments recognised in the current year in relation to the current tax of prior years - (74)
Deferred tax (income) expense relating to the origination and reversal of temporary differences(159)438
8,668 11,642
Total income tax expense recognised in profit or loss from continuing operations8,668 9,418
Total income tax expense recognised in profit or loss from discontinued operations- 2,224
Total income tax expense recognised in profit or loss8,668 11,642
The prima facie income tax expense on pre-tax accounting profit reconciles to the income tax expense in the financial statements
as follows:
Profit from continuing operations35,249 57,993
Profit from discontinued operations- 75,226
Total profit before tax35,249 133,219
Income tax expense calculated at applicable corporate tax rates9,590 37,128
Non-assessable income(1,698)(26,278)
Non-deductible expenses472 688
Over provision of income tax in previous year - current tax- (73)
Under provision of income tax in previous year - deferred tax304 177
8,668 11,642

The tax rates used in the above reconciliation are the corporate tax rate of 28% payable by New Zealand companies under
New Zealand tax law, 30% payable by Australian companies under Australian tax law and 25.5% payable by US entities under
US tax law (being federal tax 21% and weighted average state tax 4.5%).

62
Scales Corporation Limited
Financial Statements

Opening
balance
Charged to
profit or loss
Charged to other
comprehensive
income
Closing
balance
$’000$’000$’000$’000
Deferred tax liability
Taxable and deductible temporary differences
arise from the following:
31 December 2020
Deferred tax liabilities (assets):
Trade and other receivables(23)(141)- (164)
Unharvested agricultural produce6,048 671 - 6,719
Property, plant and equipment and
computer software12,820 (745)439 12,514
Trade and other payables(703)(45)- (748)
Lease liability and right-of-use asset (NZ IFRS 16)(381)(295)- (676)
Other financial assets and liabilities, joint
ventures and pension plan1,681 298 5,972 7,951
Net deferred tax liability19,442 (257)6,411 25,596
31 December 2019
Deferred tax liabilities (assets):
Trade and other receivables(140)117 - (23)
Unharvested agricultural produce5,558 490 - 6,048
Property, plant and equipment and
computer software10,833 768 1,219 12,820
Trade and other payables(467)(236)- (703)
Lease liability and right-of-use asset (NZ IFRS 16)- (381)- (381)
Other financial assets and liabilities(196)- 1,877 1,681
Net deferred tax liability15,588 758 3,096 19,442
Current tax is the taxation expected to be paid to taxation authorities in respect of the current year. Deferred taxation is recognised
in respect of temporary differences between the tax bases of assets and liabilities and their carrying amounts in the Financial
Statements. Current and deferred tax is calculated on the basis of the laws enacted or substantively enacted at balance date.
Income tax
Current and deferred tax are recognised in profit or loss, except when the tax relates to items charged or credited to other
comprehensive income, in which case the tax is also recognised in other comprehensive income.
B6. Foreign Currency Transactions
In preparing the financial statements of the individual entities, the transactions in currencies other than New Zealand dollars are
recorded at the rates of exchange prevailing at the dates of the transaction. At the end of each reporting period financial assets
and liabilities denominated in foreign currencies are retranslated into New Zealand dollars at the rates prevailing at the end of the
reporting period.
Exchange differences from these transactions are recognised in profit or loss in the period in which they arise.
Income and expenses for each subsidiary whose functional currency is not New Zealand dollars are translated at exchange rates that
approximate the rates at the actual dates of the transactions. Assets and liabilities of each subsidiary are translated at exchange rates
at balance date.
All resulting exchange differences are recognised in the foreign exchange translation reserve, which is a separate component
of equity.
The effective portion of exchange differences on foreign currency borrowings designated as hedges of net investments in foreign
operations is also recognised in the foreign exchange translation reserve.
B5. Taxation (continued)

Annual Report - Year Ended 31 December 2020
63
Financial Statements
C. Key Assets
This section shows the key assets Scales uses to generate operating revenues. There is information about:
• property, plant and equipment;
• unharvested agricultural produce;
• investments accounted for using the equity method;
• goodwill; and
• inventories.

C1. Property, Plant and Equipment
Land and
buildings at
fair value
Apple trees
at fair value
Plant and
equipment
at cost
Office
equipment
& motor
vehicles
at cost
Capital
work in
progress
at costTotal
$’000$’000$’000$’000$’000$’000
Gross carrying amount
Balance at 1 January 201986,669 31,600 67,686 11,964 2,014 199,933
Additions96 3,656 5,011 1,132 5,506 15,401
Disposals- - (11,532)(994)- (12,526)
Revaluation10,020 (1,342)- - - 8,678
Effect of foreign currency translation(6)- (13)- (7)(26)
Balance at 31 December 201996,779 33,914 61,152 12,102 7,513 211,460
Additions6,712 1,970 3,771 1,569 10,215 24,237
Reclassified as held for sale(3,148)- - - - (3,148)
Disposals- - (671)(660)- (1,331)
Revaluation7,693 (3,080)- - - 4,613
Effect of foreign currency translation(137)- (270)(2)10 (399)
Balance at 31 December 2020107,899 32,804 63,982 13,009 17,738 235,432
Accumulated depreciation
and impairment
Balance at 1 January 2019- - 40,447 8,900 - 49,347
Depreciation expense1,097 2,773 4,573 1,211 - 9,654
Disposals- - (8,477)(918)- (9,395)
Revaluation(1,097)(2,773)- - - (3,870)
Effect of foreign currency translation- - (17)- - (17)
Balance at 31 December 2019- - 36,526 9,193 - 45,719
Depreciation expense1,440 3,049 4,585 1,220 - 10,294
Reclassified as held for sale(598)- - - - (598)
Disposals- - (347)(626)- (973)
Revaluation(1,440)(3,049)- - - (4,489)
Impairment on revaluation2,471 1,840 - - - 4,311
Effect of foreign currency translation- - (143)- - (143)
Balance at 31 December 20201,873 1,840 40,621 9,787 - 54,121
Net book value
As at 31 December 201996,779 33,914 24,626 2,909 7,513 165,741
As at 31 December 2020106,026 30,964 23,361 3,222 17,738 181,311

64
Scales Corporation Limited
Financial Statements
Accounting policy
Land, buildings and apple trees are included in the statement of financial position at their fair value at the date of revaluation, less
any subsequent accumulated depreciation and subsequent accumulated impairment losses. Valuations are performed with sufficient
regularity such that the carrying amounts do not differ materially from those that would be determined using fair values at the end of
the reporting period.
Any valuation increase arising on the revaluation of such land, buildings and apple trees is recognised in other comprehensive income
and accumulated as a separate component of equity in the revaluation reserve, except to the extent that it reverses a valuation decrease
for the same asset previously recognised in profit or loss, in which case the increase is credited to profit or loss to the extent of the
decrease previously charged. A decrease in carrying amount arising on the revaluation of such land, buildings and apple trees is charged
to profit or loss to the extent that it exceeds the balance, if any, held in the revaluation reserve relating to a previous revaluation of
that asset.
Depreciation on revalued buildings and apple trees is charged to profit or loss. On the subsequent sale or retirement of revalued
property or apple trees, the attributable revaluation surplus remaining in the revaluation reserve is transferred directly to retained
earnings. No transfer is made from the revaluation reserve to retained earnings except when an asset is derecognised.
Office equipment, motor vehicles, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment
losses. Cost includes expenditure that is directly attributable to the acquisition of the item.
Depreciation is provided on property, plant and equipment, including buildings and apple trees but excluding land and capital work in
progress. Depreciation is charged so as to write off the cost or valuation of assets, other than land and capital work in progress, over
their estimated useful lives, using the straight-line method. The estimated useful lives, residual values and depreciation method are
reviewed at each year end, with the effect of any changes in estimate accounted for on a prospective basis. The following estimated
useful lives are used in the calculation of depreciation:
Apple trees 30 years
Buildings 10 to 50 years
Office Equipment and Motor Vehicles 2 to 20 years
Plant and Equipment 2 to 25 years
The gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference
between the sale proceeds and the carrying amount of the asset and is recognised in profit or loss.
Land and buildings carried at fair value
Land and buildings shown at valuation were valued at fair value as at 31 December 2020 by independent registered valuers Added
Valuation Limited and Logan Stone Limited. The valuations were arrived at by reference to market evidence of transaction prices for
similar properties.
The fair value of land and buildings is calculated on the basis of market value. Market value is determined by applying income
capitalisation and comparative sales calculations which are benchmarked against depreciated replacement cost calculations. The
valuations include adjustments to observable data for similar properties to take into account property-specific attributes.
The significant unobservable inputs, based on regional averages, for the land and buildings (mainly coolstores and packhouses) are
potential market comparative rentals $5 - $283 per square metre (2019: $5 - $155) and the capitalisation rates of 7.6% - 11%
(2019: 8.5% - 12%).
The higher the rental rates the higher the fair value. The higher the capitalisation rates the lower the fair value. Significant changes
in either of these inputs would result in significant changes to the fair value measurement. Orchard land is valued within the range
of $28,300 to $135,000 per hectare (2019: $28,300 to $123,000).
The Group’s land and buildings are classified as Level 3 in the fair value hierarchy.
The carrying amount of land and buildings had it been recognised under the cost model is $50,794,000 (31 December 2019:
$48,077,405).
Apple trees carried at fair value
The Group’s apple orchards, being the apple trees other than the existing crop on the trees, were valued at fair value by Boyd Gross
B.Agr (Rural Val), Dip Bus Std, FNZIV, FPINZ of Logan Stone Limited as at 31 December 2020.
The market valuations completed by Boyd Gross were based on a discounted cash flows (DCF) analysis of forecast income streams
and costs. They were benchmarked against a comparison of sales of other orchards adjusted to reflect the location, plantings, age
and varieties of trees and productive capabilities of the orchards. The fair value of orchard land and buildings are deducted from the
overall orchard valuation to give rise to the apple trees valuation.
The significant unobservable inputs, based on district averages, for the apple trees are:
20202019
Production levels (gross tray carton equivalent
(tce)) per hectare
2,277 - 7,1053,495 - 6,021
Orchard gate returns per tce$24.75 - $37.62$25.00 - $38.00
Orchard costs per tce$12.95 to $41.83$15.31 - $28.34
Discount rate14.84% - 17.84%15.58% - 19.40%
C1. Property, Plant and Equipment (continued)

Annual Report - Year Ended 31 December 2020
65
Financial Statements
C1. Property, Plant and Equipment (continued)
The higher the production levels and orchard gate return the higher the fair value. The higher the orchard costs and discount rate
the lower the fair value. Significant changes in any of these inputs would result in significant changes to the fair value measurement.
The Group’s apple trees are classified as Level 3 in the fair value hierarchy.
The carrying amount of apple trees had it been recognised under the cost model is $16,673,000 (31 December 2019: $19,591,963).
The apple trees, on owned and leased orchards, have the following planting profile:
Total Hectares Planted
20202019
Premium varieties:
NZ Queen210 210
Pink Lady121 123
Red sports (Fuji and Royal Gala)265 259
Other premium169 151
Traditional varieties:
Braeburn101 110
Royal Gala177 176
Other traditional158 153
1,201 1,182

Risk management strategy:
The Group is exposed to financial risks arising from changes in climatic conditions, market prices and the value of the New Zealand
dollar. The Group mitigates these risks by installing hail and frost protection on orchards which have shown to be more susceptible to
these risks, obtaining hail insurance cover, utilising foreign currency derivative instruments and building close working relationships
with key customers.
C2. Unharvested Agricultural Produce
20202019
$’000$’000
Balance at beginning of the year21,619 20,547
Decrease due to harvest(21,619)(20,547)
Development expenditure24,460 21,254
Fair value adjustment(438)365
Balance at end of the year24,022 21,619
The assessment of the value of unharvested agricultural produce was undertaken by management, using a discounted cash flow
model, and is calculated as the fair value less estimated harvest and post-harvest costs of the unharvested crop on the trees at the
reporting date. The risk adjusting discount rate represents an allowance for adverse events that may affect crop, harvest and/or
market conditions. This calculation is also benchmarked against orchard costs incurred during the current growing cycle.
The Group’s unharvested agricultural produce is classified as Level 3 in the fair value hierarchy.
The significant unobservable inputs included in the model are:
20202019
Production levels (tonnes per hectare per annum)37 - 15963 - 108
Orchard gate returns per tce$22 to $48$23 to $43
Risk adjusting discount rates 43% to 61%53% to 71%
The higher the yield per hectare and the higher the orchard gate returns per tce, the higher the fair value. The higher the risk
adjusting discount rate, the lower the fair value.

66
Scales Corporation Limited
Financial Statements
C3. Investments Accounted for Using the Equity Method
Details of each of the Group’s material joint ventures at the end of the reporting period are as follows:
Joint venturesPrincipal activity
Country of
incorporation HoldingBalance date
20202019
Profruit (2006) LimitedTrading companyNew Zealand 50%50%31 December
Meateor Pet Foods Limited PartnershipTrading companyNew Zealand 50%50%31 December
Summarised financial information in respect of the Group’s joint ventures is set out below. The aggregate summarised financial
information below represents amounts in joint ventures’ financial statements prepared in accordance with NZ IFRS Standards.
20202019
$’000$’000
Current assets35,738 31,110
Non-current assets36,430 30,218
Current liabilities(13,616)(8,233)
Non-current liabilities(6,245)(3,149)
Net assets52,307 49,946
Group's share in the net assets of equity accounted entities (50%)26,154 24,973
Carrying amount of investment in equity accounted entities26,154 24,973
The above amounts of assets and liabilities include the following:
Cash and cash equivalents1,627 2,243
Current financial liabilities (excluding trade and other payables and provisions)(2,441)(1,340)
Non-current financial liabilities (excluding trade and other payables and provisions)(2,790)(3,114)
Revenue61,541 54,892
Profit for the year after tax4,446 5,994
Other comprehensive income attributable to the owners of the company1,416 418
Total comprehensive income5,862 6,412
The above profit for the year includes the following:
Depreciation and amortisation1,576 817
Interest expense295 325
Income tax expense1,559 1,542
Reconciliation of the above summarised financial information to the carrying amount of the interest in the joint venture recognised
in the consolidated financial statements:
Share of profit before taxation3,003 3,768
Share of income tax(780)(771)
Share of other comprehensive income (net of tax)708 209
Share of net profit for the year and total comprehensive income2,931 3,206
Carrying value at beginning of the year24,973 5,213
Interest retained (foregone) in Meateor Pet Foods Limited Partnership(250)18,054
Dividend paid by Profruit (2006) Limited(1,500)(1,500)
Investment in equity accounted entities26,154 24,973

Annual Report - Year Ended 31 December 2020
67
Financial Statements
C3. Investments Accounted for Using the Equity Method (continued)
The Group share of the guarantee of the Profruit (2006) Limited bank loan facilities is $1,096,301 (2019: $2,052,808).
In 2019, the Company announced an agreement to enter into a pet food Joint Venture (JV) with Alliance Group Limited (Alliance).
Under the terms of the JV, Alliance paid $15 million to acquire a 50% interest in Meateor Food Limited’s (a wholly owned subsidiary
of the Group) New Zealand business and operations.
Accordingly, Meateor Pet Foods Limited Partnership (the LP) was incorporated on 13 March 2019. The general partner of the LP is
Meateor GP Limited (incorporated in 2019), which is owned 50/50 by the Group and Alliance.
The LP acquired Meateor Foods Limited’s New Zealand business and operations for $30 million. The Group and Alliance each
contributed $15 million in exchange for a 50% limited partnership interest. $15 million capital contribution from the Group was set
off against $30 million receivable from the LP.
A total $19.6 million gain was recognised, which included $9.8 million gain on sale of Meator New Zealand business to the LP and
$9.8 million gain on fair value measurement of the interest in the LP.
A JV is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint
arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about
the relevant activities require unanimous consent of the parties sharing control.
The results and assets and liabilities of JVs are incorporated in these consolidated financial statements using the equity method
of accounting. Under the equity method, an investment in a JV is initially recognised in the consolidated statement of financial
position at cost and adjusted thereafter to recognise the Group’s share of the profit or loss and other comprehensive income of
the JV. Dividends or distributions received from a JV reduce the carrying amount of the investment in that JV in the Group financial
statements. When the Group’s share of losses of a JV exceeds the Group’s interest in that JV, the Group discontinues recognising
its share of further losses. Additional losses are recognised only to the extent that the Group has incurred legal or constructive
obligations or made payments on behalf of the JV.
An investment in a JV is accounted for using the equity method from the date on which the investee becomes a JV until the date it
ceases to be a JV. On acquisition of the investment in a JV, any excess of the cost of the investment over the Group’s share of the net
fair value of the identifiable assets and liabilities of the investee is recognised as goodwill, which is included within the carrying value
of the investment. The requirements of NZ IAS 36 Impairment of Assets are applied to determine whether it is necessary to recognise
any impairment loss.
Due to the recent performance of the LP being below expectations, the Directors have assessed the investment in the LP for
impairment. The LP is governed by a separate board made up of representatives from the Group and Alliance. The LP Board has
reviewed the performance of the business and adopted a budget and cash flow forecast, which was used to assess impairment.
The Directors of the Group have assessed the LP Board’s approved forecast for 2021 and 2022, and growth assumptions for the
following years, including the terminal growth rate, when considering the carrying value of the investment in the LP. The LP Board’s
forecast for 2021 and 2022 included a number of plans and assumptions designed to restore and grow profitability to expected
levels. The Directors consider such assumptions to be reasonable in the circumstances.
The Directors determined the recoverable amount of the investment in the LP based on the value in use of the business which uses
future cash flows covering a 5 year period based on the LP Board approved forecast.
The Directors concluded that there is no impairment of the investment in the LP as the recoverable amount exceeded the carrying
value of the investment in the LP.
$’000
Recoverable amount of Group's investment in the LP20,790
Carrying value19,956
Headroom834
Key assumptions:
Pre-tax discount rate12.55%
Sales and cost of sales growth rate in years 1-54.50%
Overhead cost growth rate in years 1-51.50%
Terminal growth rate beyond year 51.90%

The pre-tax discount rate was determined based on the weighted average cost of capital which utilises past experience and
external sources.

68
Scales Corporation Limited
Financial Statements
C3. Investments Accounted for Using the Equity Method (continued)
The sensitivity of the recoverable amount of the Group’s investment in the LP to the reasonably possible changes is set out below:
$’000$’000
+0.5%-0.5%
Pre-tax discount rate(997)1,095
Sales and cost of sales growth rate in years 1-51,136 (1,113)
Overhead cost growth rate in years 1-5(143)141
Terminal growth rate499 (456)
+10%-10%
Forecast earnings2,541 (2,541)
Changes in each key assumptions that would result in the recoverable amount equalling the carrying amount, assuming all other
inputs remain unchanged, are set out below:
Pre-tax discount rateIncrease by 0.4%
Sales and cost of sales growth rate in years 1-5Reduction by 0.4%
Overhead cost growth rate in years 1-5Increase by 2.9%
Terminal growth rateReduction by 1.0%
Forecast earningsReduction by 2.9%

C4. Goodwill
20202019
$’000$’000
Gross carrying amount
Balance at beginning of the year43,784 43,875
Effect of foreign currency exchange differences(1,879)(91)
Balance at end of the year41,905 43,784
Goodwill arising on the acquisition of a business is carried at cost as established at the date of acquisition of the business less
accumulated impairment losses, if any. Goodwill is tested for impairment annually, or more frequently if there are indications that
goodwill might be impaired. For the purpose of impairment testing, goodwill has been allocated to the cash-generating units (CGUs)
listed below which represent the lowest level at which the Directors monitor goodwill.
20202019
$’000$’000
Logistics1,955 1,955
Mr Apple14,233 14,233
Shelby25,717 27,596
41,905 43,784
As at 31 December 2020, the Directors have determined, based on discounted cash flow and value in use calculations, that there is
no impairment of goodwill associated with any of the above CGUs.
The discounted cash flow and value in use calculation uses future cash flows covering a five year period based on a Board approved
budget. The model was based on the following key assumptions:
20202019
Pre-tax discount rates10-13%12-13%
Annual growth rates2%2-3%
The Directors consider that any reasonably possible changes in the key assumptions would not cause the carrying amount of any of
the cash-generating units to exceed their recoverable amount.

Annual Report - Year Ended 31 December 2020
69
Financial Statements
C5. Inventories
20202019
$’000$’000
Finished goods20,871 21,583
Other4,934 4,839
25,805 26,422
Inventories are stated at the lower of cost and net realisable value. Cost means the actual cost of the inventory and in determining
cost the first in first out basis of stock movement is followed, with due allowance having been made for obsolescence. Net realisable
value represents the estimated selling price for inventories less all estimated costs of completion and costs necessary to make the sale.
C6. Impairment of Assets
At the end of each reporting period, the Group reviews the carrying amounts of its tangible and intangible assets to determine
whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable
amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate
the recoverable amount of an individual asset, the Group estimates the recoverable amount of the CGU to which the asset belongs.
A CGU to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an indication that
the unit may be impaired. If the recoverable amount of the CGU is less than its carrying amount, the impairment loss is allocated first
to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata based on the
carrying amount of each asset in the unit. Any impairment loss for goodwill is recognised directly in profit or loss and is not reversed
in subsequent periods.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future
pre-tax cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the
time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or CGU) is estimated to be less than its carrying amount, the carrying amount of the asset (or
CGU) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is
carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

70
Scales Corporation Limited
Financial Statements
D. Capital Funding
This section explains how Scales manages its capital structure and how dividends are returned to shareholders.
In this section there is information about:
• equity;
• dividends paid; and
• earnings per share.
Capital management
The Group’s capital includes share capital, reserves and retained earnings. The Group’s policy is to maintain a strong capital base so
as to maintain investor, creditor and customer confidence and to sustain the future development of the business. The impact of the
level of capital on shareholders’ return is also recognised and the Group recognises the need to maintain a balance between the
higher returns that might be possible with greater gearing and the advantages and security afforded by a sound capital position.
D1. Share Capital
Issued and paid up capital consists of 142,090,521 fully paid ordinary shares (2019: 141,579,238) less treasury stock of 1,580,229
shares (2019: 1,383,659 shares) (refer to Note D2). All shares rank equally in all respects.
Shares issued or purchased on market under the Senior Executive Share Scheme (Share Scheme) (Note D2) are treated as treasury
stock until vesting to the employee.
Number of shares
20202019
Fully paid ordinary shares
Opening balance141,579,238 141,103,597
Share Scheme - shares issued511,283 475,641
Closing balance142,090,521 141,579,238
Treasury stock
Opening balance1,383,659 1,195,664
Share Scheme - shares issued511,283 475,641
Share Scheme - shares fully vested(314,713)(287,646)
Closing balance1,580,229 1,383,659

The available subscribed capital of $46,072,206 (2019: $42,808,000) represents the amount of the shareholders’ equity that is
available to be returned to shareholders on a tax-free basis.
In accordance with the Companies Act 1993 the Company does not have a limited amount of authorised capital and issued shares
do not have a par value.
20202019
$’000$’000
Movement in share capital related to share-based payments:
Cash-settled share based payment scheme vested- 134
Equity-settled employee benefit share scheme vested
Interest-free loan became full recourse397 342
Accumulated share option value reclassified from reserve into share capital536 474
Accumulated dividends reclassified from retained earnings into share capital165 139
1,098 1,089

Annual Report - Year Ended 31 December 2020
71
Financial Statements
D2. Reserves
Revaluation
Cash
flow
hedge
Share
of joint
ventures
Equity-
settled
employee
benefits
Foreign
exchange
translation
Revaluation
related to
discontinued
operations
Pension
plan
reserve
Total
reserves
$’000$’000$’000$’000$’000$’000$’000$’000
Balance at 1 January 201944,540 250 - 1,248 49 25,912 - 71,999
Other comprehensive income (loss)11,329 4,677 151 - (125)- - 16,032
Transfer to retained earnings- - - - - (25,912)- (25,912)
Recognition of share-based payments- - - 866 - - - 866
Shares fully vested- - - (474)- - - (474)
Balance at 31 December 201955,869 4,927 151 1,640 (76)- - 62,511

Other comprehensive income (loss)8,663 15,020 510 - (784)- (60)23,349
Transfer from retained earnings1,093 - - - - - (341)752
Recognition of share-based payments- - - 698 - - - 698
Shares fully vested- - - (536)- - - (536)
Balance at 31 December 202065,625 19,947 661 1,802 (860)- (401)86,774
Revaluation reserve
The revaluation reserve arises on the revaluation of land, buildings and apple trees, net of the related deferred tax.
Cash flow hedge reserve
The cash flow hedge reserve represents the unrealised gains and losses on interest rate and foreign currency contracts taken out to
manage the Group interest rate and foreign currency risks, net of the related deferred tax.
Equity-settled employee benefits reserve
The Share Scheme involves the Company making available interest-free loans to selected senior executives to acquire shares in the
Company. The senior executives will not gain any benefit with respect to the shares purchased under the Share Scheme unless they
remain in employment with the Group for a period of 3 years from the date of acquisition of those shares.
The shares are held by a custodian during the restrictive period and are then transferred to the senior executive. All net dividends or
distributions received in respect of the shares must be applied to repayment of the interest-free loan.
Grant dateVesting dateExercise price, $Number of shares
Opening
balanceGrantedForfeited
Vested and
exercised
Closing
balance
5 May 2017 - FY16A5 May 20201.70278,879 - - (278,879)-
5 May 2017 - FY16B5 May 20202.4535,834 - - (35,834)-
20 April 2018 - FY17A20 April 20211.70309,698 - - - 309,698
20 April 2018 - FY17B 20 April 20212.5136,007 - - - 36,007
20 April 2018 - FY17C20 April 20213.6240,577 - - - 40,577
28 June 2018 - FY17R28 June 20214.13207,023 - - - 207,023
30 April 2019 - FY1830 April 20222.71261,356 - - - 261,356
28 June 2019 - FY18R28 June 20224.06214,285 - - - 214,285
30 April 2020 - FY1930 April 20233.20- 301,657 - - 301,657
28 June 2020 - FY19R28 June 20234.19- 209,626 - - 209,626
Total1,383,659 511,283 - (314,713)1,580,229

72
Scales Corporation Limited
Financial Statements
D2. Reserves (continued)
The weighted average share price for shares that vested on 5 May 2020 was $4.80.
The shares issued vest over three years. The estimated value of the share options is determined using the Black-Scholes pricing
calculator and is amortised over the restrictive period. This cost is expensed with the corresponding credit included in the equity-settled
employee benefits reserve. Expected share price volatility was based on historical volatility of the Company’s ordinary shares.
The inputs into the “option pricing calculator” are:
20202019
FY19FY19RFY18FY18R
Issue date share price, $4.904.965.00 4.75
Expected share price volatility, %212122 20
Option life, years333 3
Risk-free interest rate, %0.510.141.47 1.13
Exercise price, $3.204.192.71 4.06
Fair value, at the grant date, $1.831.122.43 1.10
Foreign exchange translation reserve
Hedges of a net investment in a foreign operation, including a hedge of a monetary item that is accounted for as part of the net
investment, are accounted for in two ways. Gains or losses relating to the effective portion of the hedge are recognised in other
comprehensive income. Any gains or losses relating to the ineffective portion of the hedge are recognised in profit or loss.
Gains or losses arising on translation of foreign subsidiaries results (Note B6) are also recognised in this reserve.
Retained earnings
Retained earnings represents the profits retained in the business.
D3. Dividends
20202019
$’000$’000
Final dividend paid - 9.50 (2019: 9.50) cents per share13,357 13,326
Interim dividend declared - 9.50 (2019: 9.50) cents per share13,359 13,328
26,716 26,654
All above dividends were fully imputed.
The 2020 interim dividend was declared on 9 December 2020 and paid on 15 January 2021.
D4. Imputation Credit Account
20202019
$’000$’000
Balance at end of the year20,773 23,194
The imputation credit account balance represents the net amount available at the reporting date that can be attached to future
dividends declared.
The Scales Corporation Limited consolidated tax group for income tax includes Scales Corporation Limited and all New Zealand
registered subsidiary companies other than Scales Employees Limited.

Annual Report - Year Ended 31 December 2020
73
Financial Statements
D5. Earnings Per Share
Basic earnings per share is calculated by dividing the profit attributable to shareholders of the Company by the weighted average
number of ordinary shares on issue during the year, excluding shares held as treasury stock. Diluted earnings per share assumes
conversion of all dilutive potential ordinary shares in determining the denominator.
20202019
Profit attributable to equity holders of the Company ($’000):
From continuing operations21,025 45,000
From discontinued operations- 73,002
Total21,025 118,002
Weighted average number of shares:
Ordinary shares140,402,514 140,108,891
Effect of dilutive ordinary shares (non-vested Senior Executive Share Scheme)467,735 481,924
Weighted average number of Ordinary Shares for diluted earnings per share 140,870,249 140,590,815
Earnings per share (cents):
Basic - continuing15.0 32.1
Basic - discontinued- 52.1
Basic - total 15.0 84.2
Diluted - continuing14.9 32.0
Diluted - discontinued- 51.9
Diluted - total14.9 83.9

74
Scales Corporation Limited
Financial Statements
E. Financial Assets and Liabilities
This section explains the financial assets and liabilities of Scales, the related risks and how Scales manages these risks.
In this section of the notes there is information on:
• the accounting policies, judgements and estimates relating to financial assets and liabilities; and
• the financial instruments used to manage risk.
Accounting Policies
Financial assets
Financial assets are classified into the following specified categories: financial assets ‘at fair value through profit or loss’ and ‘measured
at amortised cost’.
The classification depends on the business model for managing the financial asset and the cash flow characteristics of the financial asset
and is determined at the time of initial recognition or when a change in the business model occurs.
Financial assets at fair value through profit or loss
Financial assets are classified as financial assets at fair value through profit or loss if they are not measured at cost or amortised cost.
Gains and losses on a financial asset designated in this category and not part of a hedging relationship are recognised in profit or loss.
Financial assets measured at amortised cost
The Group’s financial assets held in order to collect contractual cash flows that are solely payments of principal and interest on the
principal outstanding are measured at amortised cost. Cash and cash equivalents, trade receivables and employee loans are classified in
this category.
Impairment of financial assets
The Group recognises a loss allowance for expected credit losses (ECL) on investments in debt instruments that are measured at
amortised cost, trade and other receivables. The amount of ECL is updated at each reporting date to reflect changes in credit risk since
initial recognition of the respective financial instrument.
The Group always recognises lifetime ECL for trade receivables. The ECL on these financial assets is estimated using a provision matrix
based on the Group’s historical credit loss experience, adjusted for factors that are specific to the debtors, general economic conditions
and an assessment of both the current as well as the forecast direction of conditions at the reporting date, including time value of
money where appropriate.
For all other financial instruments, the Group recognises lifetime ECL when there has been a significant increase in credit risk since initial
recognition. However, if the credit risk on the financial instrument has not increased significantly since initial recognition, the Group
measures the loss allowance for that financial instrument at an amount equal to 12-month ECL.
Lifetime ECL represents the ECL that will result from all possible default events over the expected life of a financial instrument.
In contrast, 12-month ECL represents the portion of lifetime ECL that is expected to result from default events on a financial instrument
that are possible within 12 months after the reporting date.
For financial assets, the ECL is estimated as the difference between all contractual cash flows that are due to the Group in accordance
with the contract and all the cash flows that the Group expects to receive, discounted at the original effective interest rate.
Financial liabilities measured at amortised cost
The Group’s financial liabilities include trade and other payables and borrowings. These financial liabilities are initially recognised
at fair value plus any directly attributable costs. Subsequent to initial recognition, they are measured at amortised cost using the
effective interest method.
Derivative financial instruments
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured to
their fair value with reference to observable market data at the end of each reporting period. The resulting gain or loss is recognised
in profit or loss immediately unless the derivative is designated as an effective hedging instrument, in which event the timing of the
recognition in profit or loss depends on the nature of the hedge relationship. The Group designates certain derivatives as cash flow
hedges. A derivative is presented as a non-current asset or a non-current liability where the cash flow will occur after 12 months and
it is not expected to be realised or settled within 12 months. Other derivatives are presented as current assets or current liabilities.
Hedge accounting
At the inception of a hedge relationship, the Group documents the relationship between the hedging instrument and the hedged
item, along with its risk management objectives and its strategy for undertaking various hedge transactions. Furthermore, at the
inception of the hedge and on an ongoing basis, the Group documents whether the hedging instrument that is used in a hedging
relationship is highly effective in offsetting changes in cash flows of the hedged item, attributable to the hedged risk.

Annual Report - Year Ended 31 December 2020
75
Financial Statements
E1. Trade and Other Receivables
20202019
$’000$’000
Trade receivables14,151 13,400
Interest receivable585 2,043
Other receivables1,091 1,504
Owing by entity accounted for using the equity method157 97
Goods and services tax3,468 3,549
19,452 20,593
Credit risk management
The Group activities expose it to credit risk which refers to the risk that a counterparty will default on its contractual obligations
resulting in financial loss to the Group. Financial instruments which potentially subject the Group to credit risk principally consist of
cash and cash equivalents, trade and other receivables and advances. The Group performs credit evaluations on trade customers,
obtains trade credit insurance as appropriate but generally does not require collateral. The Group continuously monitors the credit
quality of its major receivables and does not anticipate non-performance of those customers. Cash and cash equivalents are placed
with high credit quality financial institutions.
There is a significant concentration of credit risk with 5 customers who represent 38.07% (2019: 5 customers who represent
45.47%) of trade and other receivables.
The carrying amount of financial assets recorded in the financial statements represents the Group’s maximum exposure to credit risk.
Included in trade receivables are debtors which are past due at balance date, as payment was not received within 1 month, and
for which provision for expected credit losses was not material as there has not been a significant change in credit quality and the
amounts are still considered recoverable. No collateral is held over these balances although trade credit insurance cover is obtained in
respect of some specific receivables. Interest is not charged on overdue debtors. The ageing of these past due trade receivables is:
1 month2,316 2,086
2 months616 979
More than 2 months2,169 1,827
5,101 4,892
Accounting Policies (continued)
Cash flow hedges
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in
other comprehensive income and accumulated as a separate component of equity in the hedging reserve. The gain or loss relating to
the ineffective portion is recognised immediately in profit or loss, and is included in ‘other income’ or ‘other losses’.
Amounts recognised in the hedging reserve are reclassified from equity to profit or loss in the periods when the hedged item is
recognised in profit or loss, in the same line as the recognised hedged item. Hedge accounting is discontinued when the Group
revokes the hedging relationship, the hedging instrument expires or is sold, terminated, or exercised, or no longer qualifies for hedge
accounting. Any cumulative gain or loss deferred in the hedging reserve at that time remains in equity and is recognised when
the forecast transaction is ultimately recognised in profit or loss. When a forecast transaction is no longer expected to occur, the
cumulative gain or loss that was deferred in the hedging reserve is recognised immediately in profit or loss.
Hedges of net investments in foreign operations
Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any gain or loss on the hedging
instrument relating to the effective portion of the hedge is recognised in other comprehensive income and accumulated under the
heading of foreign exchange translation reserve. The gain or loss relating to the ineffective portion is recognised immediately in
profit or loss. Gains and losses on the hedging instrument relating to the effective portion of the hedge accumulated in the foreign
exchange translation reserve are reclassified to profit or loss on the disposal of the foreign operation.

76
Scales Corporation Limited
Financial Statements
E2. Other Financial Assets
Current:
20202019
$’000$’000
At fair value:
Foreign currency derivative instruments12,688 4,571
12,688 4,571
Non-current:
At fair value:
Foreign currency derivative instruments17,572 6,593
Shares in unlisted companies184 221
At amortised cost:
Employee loans 387 303
18,143 7,117
E3. Trade and Other Payables
Trade payables13,707 11,628
Accruals6,494 4,433
Employee entitlements4,916 3,782
25,117 19,843
E4. Borrowings
Borrowings are recorded initially at fair value, net of transaction costs. Subsequent to initial recognition, borrowings are measured
at amortised cost with any difference between the initial recognised amount and the redemption value being recognised in profit
or loss over the period of the borrowing using the effective interest method. The fair value of current and non-current borrowings is
approximately equal to their carrying amount.
The Group signed Multi-Option Facility Agreements with Coöperatieve Rabobank U.A., New Zealand Branch (Rabobank) and
Westpac New Zealand Limited (Westpac) in 2013. The total facility is $22,000,000 (2019: $22,000,000). At 31 December 2020
the undrawn amount under these facilities was $2,000,000 (2019: $2,000,000). In addition, a $1,000,000 ANZ overdraft facility is
available to Group (2019: $1,000,000). This facility was undrawn as at both 31 December 2020 and 31 December 2019.
In 2018, the Group obtained an additional USD 11,635,000 term loan from Rabobank and USD 11,635,000 term loan from
Westpac. These facilities were utilised to finance the acquisition of Shelby JV LLC Group. The USD denominated loans are designated
as a hedge of net investment in foreign operations.
The floating interest rate is 1.25% to 2.44% (2019: 2.03% to 3.06%) and the term borrowing facility expiry date is 1 July 2022.
Seasonal facility presented as current borrowings is due for repayment within one year. The bank facilities are secured by a first
ranking security interest granted by each of the Charging Group Companies* over all its present and after-acquired property
(including proceeds) and a first ranking security interest over any of the Charging Group Companies present and future assets and
undertakings which are not personal property. The bank facilities are also secured by first and exclusive registered mortgages over
property comprising coolstores, orchards and industrial and commercial property owned by members of the Charging Group.
The Multi-Option Facility Agreements with the Group’s banks include the requirement that at all times the Tangible Net Worth of the
Group, being Tangible Assets less Total Liabilities (excluding deferred tax liabilities), be not less than $100,000,000. The Group has
complied with this requirement since the facility was established. The Group policies in respect of capital management and allocation
are reviewed regularly by the Board of Directors. There have been no material changes to the Group’s management of capital during
the year.
*Charging Group Companies as at 31 December 2020 are Scales Corporation Limited, Scales Holdings Limited, Mr Apple New
Zealand Limited, New Zealand Apple Limited, Geo.H.Scales Limited, Meateor Foods Limited, Scales Logistics Limited and Meateor
Group Limited.

Annual Report - Year Ended 31 December 2020
77
Financial Statements
E4. Borrowings (continued)
Seasonal facility
Other current
borrowingsTerm borrowings
202020192020201920202019
$’000$’000$’000$’000$’000$’000
Seasonal (current) and term (non-current)
borrowings:
Opening balance- 2,000 - - 54,551 64,664
Drawdowns3,000 79,000 955 - - -
Repayments(3,000)(81,000)- - - (10,000)
Effect of foreign currency translation- - (95)- (2,352)(113)
- - 860 - 52,199 54,551
E5. Other Financial Liabilities
20202019
Current financial liabilities at fair value:$’000$’000
Foreign currency derivative instruments35 785
Interest rate swap contracts and forward rate agreements618 537
Put option3,647 3,055
4,300 4,377
Non-current financial liabilities at fair value:
Foreign currency derivative instruments366 1,459
Interest rate swap contracts and forward rate agreements554 762
Put option1,602 1,745
2,522 3,966
In 2016 the Group increased its shareholding in Fern Ridge Produce Limited (Fern Ridge) to 75%. As part of the transaction, 2.12%
of the shares were then sold to an employee of Fern Ridge, and Scales entered into agreements with the remaining shareholders
of Fern Ridge whereby those shareholders have an option to put their shares to Scales at a value based on a multiple of Fern Ridge
profits, but with a minimum value equivalent to that paid to the selling shareholders.
In 2018 the Group acquired 60% of Shelby JV LLC and its subsidiaries Shelby Foods LLC, Shelby Exports Inc, Shelby Cold Storage
LLC, Shelby Trucking LLC and Shelby Properties LLC (collectively, Shelby Group).
As part of the transaction, the Company entered into an agreement with the vendor whereby the vendor has an option to put a
further 5% of total units in Shelby Group to Scales at a value based on a multiple of Shelby Group EBITDA. The obligation to acquire
the ownership interest under the put option is included in other financial liabilities.
E6. Interest Rate Risk
Interest rate risk management
The Group is exposed to interest rate risk as it borrows funds at floating interest rates. Management monitors the level of interest
rates on an ongoing basis and may use interest rate swaps and forward rate agreements to manage interest rate risk.
Interest rate swap contracts and forward rate agreements
Under interest rate swap contracts and forward rate agreements, the Group agrees to exchange the difference between fixed and
floating rate interest amounts calculated on agreed notional principal amounts. Such contracts, some of which can commence in
future reporting years, enable the Group to mitigate the risk of changing interest rates on the cash flow exposures on the issued
floating rate debt. The fair value of these contracts at the reporting date is determined by discounting the future cash flows using
the forward interest rate curves at reporting date and the credit risk inherent in the contracts. The average contracted fixed interest
rate is based on the notional principal amount at balance date.
The Group’s interest rate swap contracts and forward rate agreements are classified as Level 2 in the fair value hierarchy.

78
Scales Corporation Limited
Financial Statements
E6. Interest Rate Risk (continued)
Details of interest rate swap contracts and forward rate agreements for the Group are:
Fixed Interest
Rate
Notional Principal
AmountFair Value
202020192020201920202019
%%$’000$’000$’000$’000
Maturity date
- Interest rate swap contracts:
Within 1 year4.62 - 10,000 - (323)-
2-5 years3.25 3.93 10,000 20,000 (849)(1,299)
After 5 years- - - - - -
20,000 20,000 (1,172)(1,299)
These interest rate swap contracts and forward rate agreements, exchanging floating rate interest amounts for fixed rate interest
amounts, are designated as cash flow hedges in order to reduce the Group’s cash flow exposure resulting from floating interest
rates on borrowings. The interest rate swap and forward rate agreement payments, and the interest payments on the loans occur
simultaneously, and the amount deferred in equity is recognised in profit or loss over the period that the floating rate interest
payments on debt impact profit or loss.
As the critical terms of the interest rate swap contracts and their corresponding hedged items are the same, the Group performs
a qualitative assessment of effectiveness and it is expected that the value of the interest rate swap contracts and the value of the
corresponding hedged items will systematically change in opposite directions in response to movements in the underlying interest
rates. The main source of hedge ineffectiveness in these hedge relationships (which is not material) is the effect of the counterparty
and the Group’s own credit risk on the fair value of the interest rate swap contract, which is not reflected in the fair value of the
hedged item attributable to the change in interest rates. No other sources of ineffectiveness emerged from these hedging relationships.
The sensitivity analysis below has been determined based on the exposure to interest rates for both derivatives and non-derivative
instruments at the reporting date. For floating rate liabilities, the analysis is prepared assuming the amount of liability outstanding at
reporting date was outstanding for the whole year. A 1% increase or decrease is used when reporting interest rate risk internally to
key management personnel and represents management’s assessment of the reasonably possible change in interest rates. Impact on
net profit after tax assumes that none of floating interest rate borrowings were hedged.
20202019
+1%-1%+1%-1%
$’000$’000$’000$’000
Impact on net profit after tax192 (192)(187)187
Impact on cash flow hedge reserve net of tax238 (247)371 (389)
E7. Foreign Currency Risk
Foreign currency risk management
Foreign currency risk is the risk that the value of the Group’s assets and liabilities or revenues and expenses will fluctuate due to
changes in foreign exchange rates. The Group is exposed to currency risk as a result of normal trading transactions denominated in
foreign currencies. The currencies in which the Group primarily trades are the Australian dollar, Euro, Canadian dollar, Great Britain
pound and United States dollar, with the largest exposure being to the United States dollar.
Currency risk is managed by the natural hedge of foreign currency receivables and payables and the use of foreign currency
derivative financial instruments. The fair value of foreign currency derivative financial instruments at the reporting date is determined
on a discounted cash flow basis whereby future cash flows are estimated based on forward exchange rates and contract forward
rates, discounted at a rate that reflects the credit risk of various counterparties.
The Group’s forward foreign exchange contracts and foreign exchange options are classified as Level 2 in the fair value hierarchy.
Details of foreign currency instruments at balance date for the Group are:
20202019
Contract ValueFair ValueContract ValueFair Value
$’000$’000$’000$’000
Sale commitments forward foreign exchange contracts217,512 14,979 210,587 5,224
Sale commitments foreign exchange options106,640 14,880 90,410 3,696

Annual Report - Year Ended 31 December 2020
79
Financial Statements
E7. Foreign Currency Risk (continued)
These foreign currency instruments are designated as cash flow hedges in order to reduce the Group’s cash flow exposure resulting
from movements in foreign currency exchange rates on anticipated future transactions. It is anticipated that the sales will take place
during the 2021 to 2025 financial years at which stage the amount deferred in equity will be released into profit or loss.
For hedges of highly probable forecast sales and purchases, as the critical terms (i.e. the notional amount, life and underlying) of
the foreign exchange forward contracts and their corresponding hedged items are the same, the Group performs a qualitative
assessment of effectiveness and it is expected that the value of the forward contracts and the value of the corresponding hedged
items will systematically change in opposite directions in response to movements in the underlying exchange rates. The Group uses
the hypothetical derivative method for the hedge effectiveness assessment and measurement of hedge ineffectiveness. As for the
hedge of the net investment in Meateor US LLC sub-group, the Group assesses effectiveness by comparing the nominal amount of
the net assets designated in the hedge relationship with the nominal amount of the hedging instrument.
This is a simplified approach because the currency of the exposure and hedging instruments perfectly match and the Group excludes
from the designation the foreign currency basis spread.
The following table demonstrates the sensitivity to a reasonably possible change of 5% in the value of New Zealand dollar against
other foreign currencies, with all other variables held constant. The impact on the Group’s profit before tax is due to changes in the
fair value of monetary assets and liabilities. The impact on the Group’s equity is due to changes in the fair value of forward exchange
contracts designated as cash flow hedges.
20202019
+5%-5%+5%-5%
$’000$’000$’000$’000
Impact on net profit after tax(273)302 (214)194
Impact on cash flow hedge reserve net of tax(11,694)10,811 (10,861)10,309
E8. Categories of Financial Instruments
2020 2019
$’000$’000
Financial assets:
Amortised cost63,789 35,979
Derivative instruments in designated hedge accounting relationships30,260 11,164
Fair value through profit or loss184 221
94,233 47,364
Financial liabilities:
Amortised cost92,919 88,910
Derivative instruments in designated hedge accounting relationships1,573 3,543
Fair value through profit or loss5,249 4,800
99,741 97,253
The carrying amount of financial instruments at amortised cost approximates their fair value.

80
Scales Corporation Limited
Financial Statements
E9. Maturity Profile of Financial Liabilities
Liquidity risk management
The Group manages liquidity risk by maintaining adequate reserves and banking facilities, by continuously monitoring forecast and
actual cash flows and matching the maturity profiles of financial assets and liabilities.
The following tables detail the Group’s remaining contractual maturity for its financial liabilities. The tables have been drawn up
based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required to pay.
The table includes both interest and principal cash flows.
Within 3
months
4 months to
1 year1–5 years Total
$’000$’000$’000$’000
2020
Trade and other payables25,117 - - 25,117
Dividend declared13,359 - - 13,359
Put options3,647 - 1,602 5,249
Borrowings208 630 52,616 53,454
Interest rate swaps and forward rate agreements196 437 614 1,247
42,527 1,067 54,832 98,426
2019
Trade and other payables19,843 - - 19,843
Dividend declared13,328 - - 13,328
Put options3,055 - 1,745 4,800
Borrowings410 1,230 55,366 57,006
Interest rate swaps and forward rate agreements198 595 1,244 2,037
36,834 1,825 58,355 97,014

Annual Report - Year Ended 31 December 2020
81
Financial Statements
F. Group Structure
This section provides information to help readers understand the Scales Group structure and how it affects the financial
position and performance of the Group. In this section there is information about subsidiaries.
F1. Subsidiary Companies
Subsidiary Companies:Principal Activity
Country of
Incorporation
Holding
2020 2019Balance Date
Fern Ridge Produce LimitedTrading companyNew Zealand 72.88%72.88%31 December
Geo. H. Scales Limited Non trading companyNew Zealand 100%100%31 December
Longview Group Holdings LimitedNon trading companyNew Zealand 100%100%31 December
Meateor Foods Australia Pty LimitedTrading companyAustralia100%100%31 December
Meateor Foods LimitedTrading companyNew Zealand 100%100%31 December
Meateor Group LimitedHolding companyNew Zealand 100%100%31 December
Meateor US LLCHolding companyUnited States100%100%31 December
Mr Apple New Zealand LimitedTrading companyNew Zealand 100%100%31 December
New Zealand Apple LimitedTrading companyNew Zealand 100%100%31 December
Scales Employees LimitedCustodial companyNew Zealand 100%100%31 December
Scales Holdings LimitedHolding companyNew Zealand 100%100%31 December
Scales Logistics LimitedFreight consolidatorNew Zealand 100%100%31 December
Scales Logistics Australia Pty LtdFreight consolidatorAustralia100%100%31 December
Selacs Insurance LimitedInsurance companyNew Zealand 100%100%31 December
Shelby Cold Storage, LLC Coldstore operatorUnited States60%60%31 December
Shelby Exports, IncNon trading companyUnited States60%60%31 December
Shelby Foods, LLC Trading companyUnited States60%60%31 December
Shelby JV LLCHolding companyUnited States60%60%31 December
Shelby Properties LLCNon trading companyUnited States60%60%31 December
Shelby Trucking LLCTrading companyUnited States60%60%31 December
Subsidiary companies are controlled by the Company. Control is achieved when the Company:
• has power over the investee;
• is exposed, or has rights, to variable returns from its involvement with the investee; and
• has the ability to use its power to affect its returns.
Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses
control of the subsidiary.
F2. Assets Held for Sale
As at 31 December 2020, Mr Apple New Zealand Limited’s Havelock North packhouse assets were classified as held for sale. An
unconditional agreement has been reached for the sale of the assets which is due to settle after balance date. The packhouse
assets are included in the Horticulture segment.

82
Scales Corporation Limited
Financial Statements
G. Other
This section includes the remaining information relating to Scales’ financial statements which is required to comply
with NZ IFRS.
G1. Capital Commitments
20202019
$’000$’000
Commitments entered into in respect of apple trees as at balance date289 1,192
G2. Leases
The Group as a lessee
The Group assesses whether a contract is or contains a lease at inception of the contract. The Group recognised a right-of-use asset
and a corresponding liability with respect to all lease arrangements in which it is the lessee, except for short-term leases (defined as
leases with a lease term of twelve months or less) and leases of low value assets. For these leases, the Group applies the practical
expedient and recognises the lease payments as an operating expense on a straight-line basis over the term of the lease unless
another systematic basis is more representative of the time pattern in which economic benefits from the lease assets are consumed.
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date,
discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the Group uses its incremental borrowing
rate (IBR).
Lease payments included in the measurement of the lease liability comprise:
• fixed lease payments (including in-substance fixed payments), less any lease incentives;
• variable lease payments that depend on an index or rate, initially measured using the index or rate at the commencement date;
• the amount expected to be payable by the lessee under residual value guarantees;
• the exercise price of purchase options, if the lessee is reasonably certain to exercise the options; and
• payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to terminate the lease.
The lease liability is presented as a separate line in the consolidated statement of financial position.
The lease liability is subsequently measured by increasing the carrying amount to reflect interest on the lease liability (using the
effective interest method) and by reducing the carrying amount to reflect the lease payments made.
The Group remeasures the lease liability (and makes a corresponding adjustment to the related right-of-use asset) whenever:
• the lease term has changed or there is a change in the assessment of exercise of a purchase option, in which case the lease
liability is remeasured by discounting the revised lease payments using a revised discount rate.
• the lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed residual
value, in which cases the lease liability is remeasured by discounting the revised lease payments using the initial discount rate.
• a lease contract is modified and the lease modification is not accounted for as a separate lease, in which case the lease liability is
remeasured by discounting the revised lease payments using a revised discount rate.
The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at or before
the commencement date and any initial direct costs. They are subsequently measured at cost less accumulated depreciation and
impairment losses.
Whenever the Group incurs an obligation for costs to dismantle and remove a leased asset, restore the site on which it is located
or restore the underlying asset to the condition required by the terms and conditions of the lease, a provision is recognised and
measured under NZ IAS 37 Provisions, Contingent Liabilities and Contingent Assets.
Right-of-use assets are depreciated over the shorter period of either the lease term or the useful life of the underlying asset. If a
lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Group expects to exercise a
purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset. The depreciation starts at
the commencement date of the lease.
The right-of-use assets are presented as a separate line in the consolidated statement of financial position.
The Group applies NZ IAS 36 Impairment of Assets to determine whether a right-of-use asset is impaired and accounts for any
identified impairment loss under this standard.
Variable rents that do not depend on an index or rate are not included in the measurement of the lease liability and the right-of-use
asset. The related payments are recognised as an expense in the period in which the event or condition that triggers those payments
occurs and are included in the line “Administration and operating expenses” in the statement of comprehensive income.
As a practical expedient, NZ IFRS 16 Leases permits a lessee not to separate non-lease components, and instead account for any
lease and associated non-lease components as a single arrangement.

Annual Report - Year Ended 31 December 2020
83
Financial Statements
G2. Leases (continued)
Right-of-use assets
Land and
buildings
Plant and
equipment
Office equipment
motor and
vehiclesTotal
$’000$’000$’000$’000
Carrying Amount
Balance at 1 January 201977,651 294 5,025 82,970
Additions2,440 136 1,053 3,629
Depreciation expense(6,013)(216)(1,595)(7,824)
Balance at 31 December 201974,078 214 4,483 78,775
Additions4,831 - 2,572 7,403
Depreciation expense(6,082)(185)(2,034)(8,301)
Balance at 31 December 202072,827 29 5,021 77,877
20202019
$’000$’000
Amounts recognised in profit and loss
Depreciation expense on right-of-use assets8,301 7,824
Interest expense on lease liabilities2,981 3,075
Expense relating to short-term leases and low-value assets2,960 2,089
Lease liabilities
Current10,053 9,427
Non-current70,190 70,713
Maturity analysis (undiscounted cash flows)
Year 110,053 9,427
Year 29,003 8,850
Year 38,089 8,098
Year 47,535 7,330
Year 57,146 6,779
Onwards61,983 65,077
103,809 105,561
Cash outflows for leases
Interest on lease liabilities2,981 3,075
Repayments of lease liabilities7,300 6,459
Short-term leases and low-value asset leases2,960 2,089
13,241 11,623

84
Scales Corporation Limited
Financial Statements
G3. Related Party Disclosures
Transactions with related parties
Certain Directors or senior management have relevant interests in companies with which Scales has transactions in the normal
course of business. A number of Scales Directors are also non-executive directors of other companies. Any transactions undertaken
with these entities have been entered in the ordinary course of business.
The compensation of the Directors and executives, being the key management personnel of the Group, is as follows:
20202019
Key management personnel remuneration$’000$’000
Short-term employee benefits2,784 2,956
Share-based payments367 218
Post-employment benefits95 104
3,246 3,278
During 2020, 1,062,451 (2019: 740,968) shares were issued to key management personnel in accordance with the Senior Executive
Share Scheme described in Note D2.
Transactions with equity accounted entities
Revenue from sale of goods1,189 1,409
Revenue from services3,910 2,564
Dividends received1,500 1,500
Trade receivables at balance date257 182
G4. Contingent Liability
In December 2018 an insurance claim was notified to Selacs Insurance Limited, a wholly owned subsidiary of Scales Holdings
Limited, which in turn is a wholly owned subsidiary of Scales Corporation Limited.
The claim arises in consequence of the collapse of the roof of a leased coldstore located in Hastings, Hawke’s Bay. The event is under
investigation by specialists and a claim has not yet been accepted.
The risk is fully reinsured, and in the event the claim is accepted and becomes payable, there will be no impact on net income or net
assets of the Group.
No claim expense, reinsurance revenue, claim payable and reinsurance receivable have been recorded in the financial statements,
except ex-gratia payments from reinsurers to the insured party recorded as claim expense and reinsurance revenue (as disclosed in
Note B3).
G5. Events Occurring After Balance Date
There were no events occurring subsequent to balance date which require adjustment to or disclosure in the financial statements.

Annual Report - Year Ended 31 December 2020
85
Financial Statements
G6. COVID-19
On 24 March 2020, the New Zealand Government announced a number of Orders under the Health Act 1956 and the Epidemic
Preparedness Act 2006 to restrict certain activities for the purposes of preventing the outbreak and spread of COVID-19. The Group’s
business units were classified as “essential services” and complied with the respective health requirements within each jurisdiction
they operated in.
As at the date of authorisation of these financial statements, the Group was operating in Alert Level 1 in New Zealand with strict
border restrictions remaining in place and contact tracing encouraged. The Group operations outside of New Zealand continue to be
further impacted by the COVID-19 pandemic.
(a) Uncertainties, estimates and judgements
The economic and public health conditions globally have impacted these trading results, and the current uncertainties are expected
to impact the trading results in the future.
The risks impacted by the uncertainty arising from COVID-19 include credit risk and market risks which impact the Group’s
assessment of expected credit losses, carrying value of inventories and the recoverability of non-current assets and goodwill.
The Directors have assessed the impact of COVID-19 on these judgements and estimates and concluded that no significant changes
to the carrying values of assets or liabilities are currently necessary.
(b) Government grants
Government support was received in New Zealand and Australia by Group subsidiaries. While the criteria were met for receiving this
support, the Group opted to refund these amounts to the respective government agencies.
Similar support was received in the United States of America by way of government loans. These loans may be forgiven if the
eligibility criteria are met. The loan balances are carried as a liability until the criteria are met.
Government grants are not recognised until there is reasonable assurance that the Group will comply with the conditions attaching
to them and that the grants will be received. Government grants are recognised in profit or loss on a systematic basis over the
periods in which the Group recognises as expenses the related costs for which the grants are intended to compensate.

INDEPENDENT AUDITOR’S REPORT
TO THE SHAREHOLDERS OF SCALES CORPORATION LIMITED
OpinionWe have audited the consolidated financial statements of Scales Corporation Limited and its
subsidiaries (the ‘Group’), which comprise the consolidated statement of financial position as
at 31 December 2020, and the consolidated statement of comprehensive income, statement
of changes in equity and statement of cash flows for the year then ended, and notes to the
consolidated financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying consolidated financial statements, on pages 46 to 85, present
fairly, in all material respects, the consolidated financial position of the Group as at 31 December
2020, and its consolidated financial performance and cash flows for the year then ended in
accordance with New Zealand Equivalents to International Financial Reporting Standards (‘NZ
IFRS’) and International Financial Reporting Standards (‘IFRS’).
Basis for opinionWe conducted our audit in accordance with International Standards on Auditing (‘ISAs’) and
International Standards on Auditing (New Zealand) (‘ISAs (NZ)’). Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated
Financial Statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
We are independent of the Company in accordance with Professional and Ethical Standard 1
International Code of Ethics for Assurance Practitioners (including International Independence
Standards) (New Zealand) issued by the New Zealand Auditing and Assurance Standards Board
and the International Ethics Standards Board for Accountants’ International Code of Ethics
for Professional Accountants (including International Independence Standards), and we have
fulfilled our other ethical responsibilities in accordance with these requirements.
Other than in our capacity as auditor and the provision of other assurance services, we have no
relationship with or interests in the Company or any of its subsidiaries. These services have not
impaired our independence as auditor of the Company and Group.
Audit materialityWe consider materiality primarily in terms of the magnitude of misstatement in the financial
statements of the Group that in our judgement would make it probable that the economic
decisions of a reasonably knowledgeable person would be changed or influenced (the
‘quantitative’ materiality). In addition, we also assess whether other matters that come to our
attention during the audit would in our judgement change or influence the decisions of such a
person (the ‘qualitative’ materiality). We use materiality both in planning the scope of our audit
work and in evaluating the results of our work.
We determined materiality for the Group financial statements as a whole to be $1.9 million.
Key audit mattersKey audit matters are those matters that, in our professional judgement, were of most
significance in our audit of the consolidated financial statements of the current period.
These matters were addressed in the context of our audit of the consolidated financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
86
Scales Corporation Limited
Financial Statements

Key audit matterHow our audit addressed the key audit matter
Valuation of Unharvested Agricultural Produce
Unharvested agricultural produce growing on bearer plants (e.g.
fruit), is measured at fair value less costs to sell in accordance
with NZ IAS 41 Agriculture.
The Group’s unharvested agricultural produce was valued at
$24.02 million at balance date as described in note C2. A
revaluation loss of $0.4 million is recorded in profit or loss.
Fair value less cost to sell is calculated by the Group using a
discounted cash flow model. The model includes significant
unobservable inputs and assumptions including, for each
variety, the forecast production per hectare per annum by
weight, sales prices, and risk-adjusting discount rates, as well as
costs to harvest and sell.
The risk-adjusting discount rates take into account the risk of
unknown adverse events that may affect crop, harvest and/or
market conditions.
The valuation of unharvested agricultural produce is considered
to be a key audit matter due to the level of judgement required
to determine the fair value less costs to sell.
Our procedures focused on the appropriateness of the valuation
methodology and the key assumptions applied in the internal
valuation model.
Our procedures included, amongst others:
• Holding discussions with management and considering market
information to identify factors, including environmental or
market risks, that would impact the current crop valuation.
• Engaging a Deloitte valuation specialist to consider whether
the valuation method applied was appropriate and whether
the risk-adjusting discount rates were reasonable based on
market information and risks relating to the unharvested
agricultural produce.
• Challenging the reasonableness of the key assumptions by
comparing the forecast production, prices, and costs to harvest
and sell for the current growing season to the approved budgets
for each orchard.
• Assessing the historical accuracy of the Group’s budget forecasts
by comparing to the actual results.
• Checking the mechanical accuracy of the discounted cash
flow model.
Valuation of Apple Trees
As disclosed in note C1 the Group has apple trees valued at
$31 million. A revaluation decrease of $1.8 million and $31,000
were recognised in profit and loss and other comprehensive
income, respectively.
The Group has a policy of recording apple trees at fair value
with valuations performed with sufficient regularity that the
carrying amount at the end of a reporting period does not differ
materially from their fair value.
The fair value of the Apple trees are determined by an
independent registered valuer on the basis of a discounted
cash flow analysis of forecast income streams and costs from
each orchard less the fair value of orchard land and buildings.
The model uses a number of significant unobservable inputs, in
particular: production levels per hectare, orchard gate returns
(market prices), orchard costs, and discount rates.
Valuation of apple trees is considered to be a key audit matter
due to the significance of the assets to the Group’s consolidated
statement of financial position, and the level of judgement
involved in valuing the apple trees.
Our procedures focused on the appropriateness of the valuation
methodology and the key assumptions applied in the model.
Our procedures included, amongst others:
• Evaluating the Group’s processes in respect of the independent
valuation of the apple trees including its review of the
valuation methodology and determination of the key valuation
assumptions;
• Engaging a Deloitte valuation specialist to consider whether the
valuation methods applied were reasonable;
• Assessing the competence, objectivity and integrity of the
Group’s independent registered valuer. This included assessing
the valuer’s professional qualifications, experience and
independence. It also included meeting with the valuer to
understand the valuation process adopted and to identify and
challenge the critical judgement areas in the valuation. We
specifically discussed the impact of COVID-19 with the valuer;
• Assessing the valuation methodology for consistency with the
the most recent valuation (“2019 valuation”) and determining
whether any changes to the methodology were appropriate;
• Challenging the reasonableness of the key assumptions by
comparing them to the 2019 valuation, the Group’s internal
data and current market evidence. We focused on the
assumptions relating to production levels per hectare, orchard
gate returns (market prices), orchard costs, and discount rates,
including consideration of the impact of COVID-19;
–We tested estimated production levels per hectare by
comparing orchard hectares in production with the 2019
valuation. We compared the production levels per hectare to
external production data as well as internal production data
for the previous season.
–We tested the orchard gate returns by comparing these to
actual sales returns received during the previous year.
–We challenged orchard costs by comparing orchard costs to
the 2019 valuation and available market data.
–We challenged the discount rates by comparing them with
2019 valuation discount rates and considering the risks
associated with the orchards.
• Checking the mechanical accuracy of the discounted cash flow
models on a sample basis.
Annual Report - Year Ended 31 December 2020
87
Financial Statements

Other informationThe directors are responsible on behalf of the Group for the other information. The other
information comprises the information in the Annual Report that accompanies the consolidated
financial statements and the audit report. The Annual Report is expected to be made available to us
after the date of this auditor’s report.
Our opinion on the consolidated financial statements does not cover the other information and we
will not express any form of assurance conclusion thereon.
Our responsibility is to read the other information identified above when it becomes available and
consider whether the other information is materially inconsistent with the consolidated financial
statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
When we read the other information in the Annual Report, if we conclude that there is a material
misstatement therein, we are required to communicate the matter to the directors and consider
further appropriate actions.
Directors’ responsibilities
for the consolidated
financial statements
The directors are responsible on behalf of the Group for the preparation and fair presentation of the
consolidated financial statements in accordance with NZ IFRS and IFRS, and for such internal control
as the directors determine is necessary to enable the preparation of consolidated financial statements
that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the directors are responsible on behalf of the
Group for assessing the Group’s ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis of accounting unless the
directors either intend to liquidate the Group or to cease operations, or have no realistic alternative
but to do so.
88
Scales Corporation Limited
Financial Statements
Key audit matterHow our audit addressed the key audit matter
Impairment Assessment of the investment in Meateor Pet
Foods Limited Partnership (“LP”)
As disclosed in note C3 the Group holds a 50% investment
in Meateor Pet Foods Limited Partnerhip, a joint venture. The
entity is an equity accounted investment with a carrying value
of $20 million at 31 December 2020.
Due to the recent performance of the LP being below
expectations, the Group has assessed the investment in the
LP for impairment. A discounted cash flow methodology was
used to determine the recoverable amount of the investment in
the LP at 31 December 2020. Within the net assets of the LP is
goodwill which must be tested for impairment annually.
The key assumptions applied in the model are:
• Forecast earnings;
• Pre-tax discount rates;
• Sales and cost of sales growth rate;
• Overhead cost growth rate; and
• Terminal growth rate.
The Group has concluded that there is no impairment of the
investment in the LP as the recoverable amount exceeded the
carrying value of the LP, however, the Group determined that
there are reasonably possible changes in key assumptions that
could result in impairment as disclosed in C3.
We have included the impairment assessment of the Group’s
investment in Meateor Pet Foods Limited Partnership as a key
audit matter due to the significance of the balance to the
financial statements and the level of judgement applied by the
Group in determining the key assumptions used to determine
the recoverable amount, including the sensitivities of
these assumptions.
We considered whether the Group’s methodology for assessing
impairment is compliant with NZ IAS 36 Impairment of Assets. We
focused on testing and challenging the suitability of the model and
reasonableness of the assumptions used by the Group in conducting
their impairment reviews.
Our procedures included:
• Agreeing a sample of future cash flows to Board approved
forecasts; and
• Challenging the reliability of the Group’s growth rates by
comparing the forecasts underlying the growth rates to historical
forecasts and actual results of the underlying businesses (where
applicable) and to external sector forecast data. This also
included consideration of the impact of COVID-19 on both
forecast revenue and profitability of the LP.
We used our internal valuation specialists to assist with evaluating
the models and challenging the Group’s key assumptions. The
procedures of the specialist included:
• Evaluating the appropriateness of the valuation methodology;
• Testing the mathematical integrity of the model;
• Evaluating the Group’s determination of the pre-tax discount
rates used in the model through consideration of the relevant risk
factors for the LP, the cost of capital for the LP, and market data
on comparable businesses; and
• Comparing the terminal growth rates to market data for the
industry sectors.
We evaluated the sensitivity analysis performed by management to
consider the extent to which a change in one or more of the key
assumptions could give rise to impairment in the investment in the LP.

Paul Bryden, Partner
for Deloitte Limited
Christchurch, New Zealand
25 February 2021
Auditor’s responsibilities
for the audit of the
consolidated financial
statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial
statements as a whole are free from material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance,
but is not a guarantee that an audit conducted in accordance with ISAs and ISAs (NZ) 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 consolidated financial
statements.
A further description of our responsibilities for the audit of the consolidated financial statements is
located on the External Reporting Board’s website at:
https://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/audit-report-1
This description forms part of our auditor’s report.
Restriction on useThis 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’s shareholders as a body, for
our audit work, for this report, or for the opinions we have formed.
Annual Report - Year Ended 31 December 2020
89
Financial Statements