DGL – 2021 Annual Report
WINNING
TOGETHER.
DELEGAT GROUP LIMITED ANNUAL REPORT 2019
DELEGAT GROUP LIMITED | ANNUAL REPORT 2021
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Performance Highlights
Financial Highlights
Executive Chairman’s Report
Acting Managing Director’s Report
Awards and Accolades
Board of Directors
Directors’ Responsibility Statement
Statement of Financial Performance
Statement of Other Comprehensive Income
Statement of Changes in Equity
Statement of Financial Position
Statement of Cash Flows
Notes to the Financial Statements
Independent Auditor’s Report
Corporate Governance Statement
Other Disclosures
Directory
Last year, wine
lovers around the
world enjoyed
190 million glasses
of our wine.
CONTENTS
1
Record Operating NPAT
1
up 8%
$65.5 MILLION
PERFORMANCE HIGHLIGHTS 2021
Global Case Sales
3,178,000
Operating Return on Capital Employed
13.8%
Record Operating EBITDA
1
up 5%
$122.9 MILLION
Cash from Operations
$74.7 MILLION
1.
Operating Performance is a non-GAAP measure and as such does not have a standardised meaning prescribed by GAAP. It may therefore not be comparable to non-GAAP
measures presented by other entities.
DELEGAT ANNUAL REPORT 2021 PERFORMANCE HIGHLIGHTS2
Notes:
1. EBITDA means earnings before interest, tax, depreciation and amortisation.
2. Operating EBITDA means EBITDA before NZ IFRS fair value adjustments.
3. EBIT means earnings before interest and tax.
4. Operating EBIT means EBIT before NZ IFRS fair value adjustments.
5. NPAT means net profit after tax attributable to ordinary Shareholders.
6. Operating NPAT means NPAT before NZ IFRS fair value adjustments after tax.
7. Net Assets means total assets less total liabilities.
8. EPS means earnings per share and is calculated on NPAT for the year divided
by the weighted average number of ordinary shares on issue. The weighted
average number of shares on issue are 101,130,000.
9. Operating Revenue is before fair value movements on derivative instruments
(if gains).
10. Operating EBITDA, Reported EBITDA, Operating EBIT, Reported EBIT,
Operating NPAT, Reported NPAT, EPS, Net Assets and Total Assets for the
years ended 30 June 2017, 2018, 2019 and 2020 have been restated for growing
costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
FINANCIAL HIGHLIGHTS 2021
J I M D E LEG AT
EXECUTIVE CHAIRMAN
GRAEME LORD
ACTING MANAGING DIRECTOR
This Annual Report is dated 27 August 2021 and is signed on behalf of the Board by:
YEAR ENDED 30 JUNE20172018201920202021
Case Sales (000s)2,6562,7363,0083,2773,178
OPERATING PERFORMANCE
Operating Revenue
9
($m)233.9255.8278.0302.9302.7
Operating EBITDA
1, 2, 10
($m)84.795.4104.7116.7122.9
Operating EBIT
3, 4, 10
($m)67.676.584.295.199.9
Operating EBIT % of Revenue 29%30%30%31%33%
Operating NPAT
5, 6, 10
($m)37.845.451.560.765.5
Operating NPAT % of Revenue
16%18%19%20%22%
REPORTED PERFORMANCE
Revenue ($m) 235.3255.8278.0304.2305.4
EBITDA
1, 10
($m)89.397.298.1119.2118.3
EBIT
3, 10
($m)72.278.377.697.695.3
EBIT % of Revenue 31%31%28%32%31%
N PAT
5, 10
($m)41.246.746.865.462.2
NPAT % of Revenue 18%18%17%21%20%
EPS
8, 10
40.7c46.2c46.3c64.7c61.5c
Net Assets
7, 10
($m)294.6330.6361.3410.5454.4
Total Assets
10
($m) 728.4779.9802.0827.4884.6
FINANCIAL HIGHLIGHTS DELEGAT ANNUAL REPORT 2021 3
On behalf of the Board of Directors of Delegat Group Limited, it is with great pleasure that I present
to you, yet another record year for Delegat Group Limited on our journey to build a leading global
Super Premium wine company. I am pleased to present its operating and financial results for the
year ended 30 June 2021, which has been a challenging but successful year for the Group. The
results achieved in 2021 are testament to the strength of Delegat Group’s business model.
PERFORMANCE HIGHLIGHTS
• Global Case Sales of 3,178,000.
• Record Operating NPAT of $65.5 million, up 8%.
• Record Operating EBITDA of $122.9 million, up 5%.
• Strong Cash from Operations of $74.7 million.
• Operating Return on Capital Employed of 13.8%.
The Group presents its financial statements in accordance with the New Zealand equivalents to
International Financial Reporting Standards (NZ IFRS).
To provide further insight into the Group’s underlying operational performance, the Group has also
included in this report an Operating Performance Report. This Operating Performance Report
excludes the impact of fair value adjustments required under NZ IFRS for grapes and derivative
instruments. As a fully integrated winemaking and sales operation, Operating Profit includes the
fair value adjustment in respect of grapes when packaged wine is sold rather than on harvest of
the grapes, and the fair value adjustment on derivative instruments when these foreign exchange
contracts and interest rate swaps are realised.
EXECUTIVE CHAIRMAN’S REPORT 2021
“The results achieved
in 2021 are testament to
the strength of Delegat
Group’s business model.”
JIM DELEGAT EXECUTIVE CHAIRMAN
EXECUTIVE CHAIRMAN’S REPORT DELEGAT ANNUAL REPORT 2021 5
The Group has included a reconciliation of Operating Profit to Reported Profit which eliminates from
each line in the Statement of Financial Performance all fair value adjustments.
1
OPERATING PERFORMANCE
A record operating NPAT of $65.5 million was generated compared to $60.7 million
*
in the previous
12 months. Operating EBIT of $99.9 million is $4.8 million higher than last year. Operating Expenses
(before NZ IFRS adjustments) at $51.0 million are $5.1 million lower than last year.
Delegat achieved Operating Revenue of $302.7 million on global case sales of 3,178,000 in the year.
The Group’s case sales performance and foreign currency rates achieved are detailed in table 2.
NZ IFRS FAIR VALUE ADJUSTMENTS
In accordance with NZ IFRS the Group is required to account for certain assets at ‘fair value’ rather
than at historic cost. All movements in these fair values are reflected in and impact the Statement of
Financial Performance. The Group records adjustments in respect of three significant items at the
year-end as described below and detailed in table 3.
June 2021 June 2020 % change
NZ$ millions Restated* vs 2020
Operating Revenue
1
302.7 302.9 0%
Operating Gross Profit
2
150.9 151.2 0%
Operating Gross Margin 50% 50%
Operating Expenses
3
(51.0) (56.1) 9%
Operating EBIT
4
99.9 95.1 5%
Operating EBIT % of Revenue 33% 31%
Interest and Tax (34.4) (34.4) 0%
Operating NPAT
4
65.5 60.7 8%
Operating NPAT % of Revenue 22% 20%
Operating EBITDA
4
122.9 116.7 5%
Operating EBITDA % of Revenue 41% 39%
Table 1 OPERATING PERFORMANCE
Notes:
1. Operating Revenue is before fair value movements on derivative instruments (if gains).
2. Operating Gross Profit is before the net fair value movements on biological produce (harvest adjustment) and the NZ IFRS adjustments excluded in Note 1.
3. Operating Expenses are before fair value movements on derivative instruments (if losses).
4. Operating EBIT, EBITDA and NPAT are before any fair value adjustments.
1.
Operating Performance is a non-GAAP measure and as such does not have a standardised meaning prescribed by GAAP. It may therefore not be comparable to non-GAAP
measures presented by other entities. The Executive Chairman and Acting Managing Director’s Reports are read by the auditors as part of their responsibilities in respect
of other information as disclosed in their audit report.
* The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
DELEGAT ANNUAL REPORT EXECUTIVE CHAIRMAN’S REPORT6
• Harvest Provision Release (Grapes) – Inventory is valued at market value, rather than costs
incurred, at harvest. Any fair value adjustment is excluded from Operating Performance for
the year, by creating a Harvest Provision. This provision is then released through Cost of Sales
when inventory is sold in subsequent years. This represents the reversal of prior periods’ fair
value adjustments in respect of biological produce as finished wine is sold in subsequent years.
In 2021, the market value of the Company grapes exceeded the costs incurred by $9.2 million
(2020 Restated*: $18.1 million). This write-up is lower than last year due to a lower-yielding 2021
vintage. This write-up, less the impact of prior years’ vintages being sold, has resulted in a net
write-down of $7.3 million for the year (2020 Restated*: write-up of $1.2 million);
• Derivative Instruments are held to hedge the Group’s foreign currency and interest rate
exposure. The mark-to-market movement of these instruments at balance date resulted in a fair
value write-up of $2.7 million (2020: write-up of $1.3 million);
• The tax effect of reinstatement of depreciation in relation to the reintroduction of depreciation
deductions on buildings has resulted in a tax write-up of $nil (2020: $2.9 million).
The above adjustments, net of taxation, amount to a write-down of $3.3 million for the year (2020
Restated*: write-up of $4.7 million).
Table 2 CASE SALES AND FOREIGN CURRENCY
June 2021 June 2020 % change
Case Sales (000s) vs 2020
UK, Ireland and Europe 1,074 1,101 -2%
North America (USA and Canada) 1,487 1,438 3%
Australia, NZ and Asia Pacific 617 738 -16%
Total Cases 3,178 3,277 -3%
Foreign Currency Rates
GB£ 0.4988 0.5025 1%
AU$ 0.9301 0.9313 0%
US$ 0.6737 0.6493 -4%
CA$ 0.8838 0.8648 -2%
* The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
EXECUTIVE CHAIRMAN’S REPORT DELEGAT ANNUAL REPORT 2021 7
RECONCILIATION OF REPORTING TO OPERATING PERFORMANCE
Accounting for all fair value adjustments under NZ IFRS, the Group’s reported audited financial
performance for the year ended 30 June 2021 is reconciled to Operating Profit as detailed in table 4.
CASH FLOW
The Group generated Cash Flows from Operations of $74.7 million in the current year, which is
a decrease of $9.6 million or 11% on the previous year. This decrease is due to higher payments
to suppliers and employees and higher net income tax paid. A total of $62.2 million was paid for
additional property, plant and equipment during the year, this includes vineyard developments in
New Zealand, and development of the Hawke’s Bay and Marlborough wineries, which will provide
earnings growth into the years ahead. The Group distributed $17.2 million to Shareholders in
dividends. A net drawdown of $3.2 million was made during the year, increasing borrowings.
Having secured a $330.0 million syndicated Senior Debt facility in 2019 the Group is well positioned
to fund its current operations as well as future capital investment in both New Zealand and Australia.
The Group’s net debt at 30 June 2021 amounted to $249.1 million, an increase of 4% compared to
last year and remains well within the Group’s long-term bank debt facilities.
DIVIDENDS
The Directors consider that the underlying operational performance and continued strong cash
flows justify an increase in dividends this year. Accordingly, the Directors are pleased to advise they
have approved a fully imputed dividend payout of 20.0 cents per share. The dividend will be paid on
8 October 2021 to Shareholders on record at 24 September 2021.
Notes:
1. Biological Produce (Grapes) is the difference between market value paid for grapes and the cost to grow grapes.
The Harvest Provision is reversed and only recognised when the finished wine is sold.
2. n/m means not meaningful.
Table 3 IMPACT OF FAIR VALUE ADJUSTMENTS
June 2021 June 2020 % change
NZ$ millions Restated* vs 2020
Operating NPAT 65.5 60.7 8%
Operating NPAT % of Revenue 22% 20%
NZ IFRS Fair Value Items
Biological Produce (Grapes)
1
(7.3) 1.2 n/m
2
Derivative Instruments 2.7 1.3 108%
Total Fair Value Items (4.6) 2.5 n/m
2
Taxation of NZ IFRS fair value items 1.3 (0.7) n/m
2
Reinstatement of Building tax depreciation – 2.9 -100%
Fair Value Items after Tax (3.3) 4.7 n/m
2
Reported NPAT 62.2 65.4 -5%
* The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
DELEGAT ANNUAL REPORT 2021 EXECUTIVE CHAIRMAN’S REPORT8
INVESTING FOR GROWTH
Delegat Group continues to invest to support our strategic goal of building a leading global Super
Premium wine company. During the year under review $61.7 million was invested in growth assets
including development of the Group’s wineries, land acquisition and vineyard development in New
Zealand and the Barossa Valley, Australia.
The Group plans to invest an additional $29.7 million in 2022 to provide earnings growth in the years
ahead. This capital investment supports the Group’s plan to grow sales to 3,976,000 cases by 2024
and will provide for further growth beyond that period.
OUR GREAT WINE PEOPLE
The Board would like to take this opportunity to acknowledge our Delegat Great Wine People around
the world. Our global team has once again shown great resolve and resilience to deliver success in
a challenging year. The workload and operating environment endured this year have asked a great
deal of our teams around the world and they have responded magnificently. Our people have built a
unique culture founded on our values of Aim High, Mastery and Winning Together. The commitment
and talent of our global team underpins our success and positions the Group well to deliver on its
substantial growth plans.
J I M D E LEG AT EXECUTIVE CHAIRMAN
2021 2020
Restated*
Notes:
1. EBIT means earnings before interest and tax.
2. NPAT means net profit after tax.
3. EBITDA means earnings before interest, tax, depreciation and amortisation.
Table 4 RECONCILIATION OF REPORTING TO OPERATING PERFORMANCE
Operating Fair Value Reported Operating Fair Value Reported
NZ$ millions Adjustment Adjustment
Revenue 302.7 2.7 305.4 302.9 1.3 304.2
Cost of Sales (151.8) (7.3) (159.1) (151.7) 1.2 (150.5)
Gross Profit 150.9 (4.6) 146.3 151.2 2.5 153.7
Operating Expenses (51.0) – (51.0) (56.1) – (56.1)
EBIT
1
99.9 (4.6) 95.3 95.1 2.5 97.6
Interest and Tax (34.4) 1.3 (33.1) (34.4) 2.2 (32.2)
N PAT
2
65.5 (3.3) 62.2 60.7 4.7 65.4
EBIT
1
99.9 (4.6) 95.3 95.1 2.5 97.6
Depreciation 23.0 – 23.0 21.6 – 21.6
EBITDA
3
122.9 (4.6) 118.3 116.7 2.5 119.2
* The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
EXECUTIVE CHAIRMAN’S REPORT DELEGAT ANNUAL REPORT 2021 9
E&E Black Pepper Shiraz is recognised as an icon wine of the Barossa Valley,
and indeed its pedigree is supported by its classification by Langton’s
as one of the great wines of Australia.
HAILED AS
ONE OF THE
GREAT WINES OF
AUSTRALIA.
Our global team demonstrated great resilience and resolve in the 2021 financial year, delivering
record Operating Net Profit after tax of $65.5 million in a year impacted by the Covid-19 pandemic
and associated global supply chain disruption. We are very proud and appreciative of the way
our people brought to life our core value of Winning Together, in what can only be described as a
challenging year.
GLOBAL SALES PERFORMANCE
The Group achieved global case sales of 3,178,000 cases which was 3% lower than the previous year.
The decline in sales was primarily due to the impact of ongoing global port congestion compounded
by constrained shipping line capacity on all major trade lanes.
The ongoing Covid-19 pandemic, related lockdowns and social distancing requirements have limited
field sales activities and significantly reduced sales in on premise channels. Despite this our in-
market sales teams have engaged productively with customers and distributors throughout the
year. In this environment, consumers have gravitated to established brands that they know and
trust, and Oyster Bay has continued to flourish as a leading Super Premium wine brand.
The Group’s sales continue to be well diversified by market with 47% in North America, 34% in United
Kingdom, Ireland and Europe, and 19% in the Australia, New Zealand and Asia Pacific region.
The Group continues to invest in the development of dedicated in-market sales teams to support
substantial future sales growth. The Group has in-market sales teams in New Zealand, Australia,
the United Kingdom, the United States, Canada and China. This unique infrastructure of in-market
sales offices delivers the Group high quality distribution, enduring business relationships, market
knowledge and focus.
ACTING MANAGING DIRECTOR’S REPORT 2021
“We are very proud and
appreciative of the way our
people brought to life our core
value of Winning Together, in
what can only be described as
a challenging year.”
GRAEME LORD ACTING MANAGING DIRECTOR
DELEGAT ANNUAL REPORT 2021 ACTING MANAGING DIRECTOR’S REPORT12
NORTH AMERICA
Sales in North America grew by 3% to a record 1,487,000 cases, albeit sales volumes were
constrained by port congestion and reduced shipping line capacity.
The United States remains one of the world’s most attractive wine markets, demonstrating
sustained premium category growth and strong demand for imported wines including Marlborough
Sauvignon Blanc. This makes it a major growth market opportunity for the Group.
The Oyster Bay brand continued to achieve strong distribution and rate of sale per point of
distribution across the country. Oyster Bay Sauvignon Blanc is a top five white wine over US$10 by
value.
1
The Group is well positioned to continue building momentum through its strong relationships
with its distributor partners, a key factor in driving success of Oyster Bay and Barossa Valley Estate.
In Canada, a strong base of distribution has been established in each of the major provinces. Oyster
Bay has grown to become one of the leading Super Premium wine brands in the market, with
success being achieved across the range, including number two Chardonnay and top ten Pinot Noir
in Canada above C$14.
2
UNITED KINGDOM, IRELAND AND EUROPE
Sales in the United Kingdom, Ireland and Europe region were 1,074,000 cases, 2% lower than the
prior year, largely due to supply chain constraints.
Oyster Bay has maintained its Super Premium category leadership position in the United Kingdom,
with Sauvignon Blanc, Chardonnay and Merlot continuing to be the top selling wines above £8
in their individual varietal categories irrespective of origin.
3
Barossa Valley Estate sales were
adversely affected by the impact of lockdowns and social distancing requirements on customers in
the hospitality sector.
In Ireland, Oyster Bay continues to achieve success as a leading Super Premium wine brand. Oyster
Bay Chardonnay, Merlot and Pinot Noir remain the top-selling wines in their respective varietal
categories above €9.
4
1. Source: IRI Scans, 52 Weeks ending 20.02.21, USD $10+, 750ml Table Wine
2. Source: LCA/ACD MAT to 28.02.21, CAD $14+, blended wholesale and retail pricing
3. AC Nielsen MAT 27.03.2021, £8+
4. AC Nielsen MAT 01.11.2020, €9
Last year our 400 strong
global team excelled in
creating an environment for
success and achieving the
extraordinary.
ACTING MANAGING DIRECTOR’S REPORT DELEGAT ANNUAL REPORT 2021 15
AUSTRALIA, NEW ZEALAND AND ASIA PACIFIC
In the established New Zealand and Australia markets, Oyster Bay is a category-leading Super
Premium wine brand. The Australia, New Zealand and Asia Pacific region achieved sales of 618,000
cases, 16% lower than in the previous year, as the Group focused on optimising long-term value
growth in preference to short-term volume growth, whilst sales in Australia were also impacted by
port congestion and reduced shipping line capacity.
In Australia, Oyster Bay Sauvignon Blanc continues to lead the category as the top-selling Sauvignon
Blanc and bottled white wine by value. Oyster Bay Chardonnay remains the top-selling Chardonnay
above A$13 and Oyster Bay Pinot Gris has become a top three product in its varietal category above
A$13.
5
During the year, the Group again experienced strong growth in China. While China is currently
a relatively small emerging market for the Group, it continues to represent a valuable long-term
growth opportunity.
BRANDS AND COMMUNICATIONS
The Group’s goal is to establish Oyster Bay and Barossa Valley Estate as leading brands in the Super
Premium wine category globally.
Based on wine consumption patterns, the Group classifies markets as Established, Growth or
Emerging. Understanding the level of maturity of our markets is essential for setting business
strategy. Marketing activities are then tailored to the specific needs of each market and phases of
brand development. The Group is investing in marketing programmes designed to grow consumer
awareness and affinity, supporting distribution and rate of sale growth per point of distribution. The
Group uses a mix of media channels, both online and offline to attract and engage the premium wine
consumers and build its brands. The Group also works closely with its retail partners to develop
highly effective in-store activations that support rate of sale growth and nurture long-term brand
affinity.
In recognition of its market performance and reputation, Oyster Bay continues to be recognised as
a Blue Chip Brand by New York’s IMPACT Magazine, a status reserved only for brands of substantial
size and sustained growth over many years. Oyster Bay was also recognised by IMPACT Magazine
as a ‘Hot Brand’ for the eleventh consecutive year.
Last year Oyster Bay engaged with
58 million wine lovers across the
globe through its media platform.
5. IRI National Wine MAT 28.02.2021, AUD $13+
DELEGAT ANNUAL REPORT 2021 ACTING MANAGING DIRECTOR’S REPORT16
2021 HARVEST
The 2021 harvest delivered exceptional quality fruit across all three of our wine regions.
The Group harvest of 37,470 tonnes was 2% lower than the prior vintage and lower than forecast due
to unseasonal cool spring weather during flowering in both Marlborough and Hawke’s Bay.
The vintage outcome will deliver excellent quality wines and the Group has appropriate inventories
to achieve the 2022 forecast case sales as outlined in this report.
SUSTAINABILITY
Recognition and respect for the environment are reflected in the strong leadership role the Group
plays in the practice and promotion of sustainable winegrowing and wine production. As a leader in
the New Zealand wine industry and as a founding member since 2002 of Sustainable Winegrowing
New Zealand (SWNZ), the Group takes its responsibilities to respect and protect the environment
very seriously. The Group’s New Zealand vineyards and wineries are 100% accredited by the
independently audited SWNZ Sustainability Programme. The Group applies many of these same
principles in the Barossa Valley, again as a leader of sustainable winegrowing practices within the
Australian wine industry.
Over the coming year the Group will undertake further work on the Group’s climate change strategy
and response, using the Task Force on Climate-related Financial Disclosure (TCFD) framework,
which covers governance, strategy, risk management, metrics and targets. The Group is also
undertaking a project to measure emissions generated from operations in order to develop plans to
minimise the emissions footprint of the business.
GROUP OUTLOOK
The Group continues to operate in an environment of elevated uncertainty arising from the ongoing
global pandemic and global supply chain disruption. Performance over the last year is testament
to the strength and resilience of the Group’s business model in this environment. The Board is
confident in the Group’s ability to prosper and drive sustainable sales and earnings growth over the
long term. Accordingly, the Group continues to invest in its assets, brands and people in line with
our strategic goal to build a leading global Super Premium wine company.
Delegat plans to grow sales by 25% to 3,976,000 cases over the next three years. The primary driver
of planned growth is Oyster Bay sales in North America.
With respect to the 2022 year, Delegat plans to grow sales by 8% to 3,419,000 cases and forecasts
Operating Net Profit after Tax to be in the range of $57 to $61 million. The forecast Operating Net
Profit After Tax is lower than this year’s result due to the impact of the lower yielding 2021 vintage
and higher grape prices resulting in an increased cost of goods per case, unfavourable exchange
rate movements, higher freight costs and the recurrence of operating expenses suspended due to
Covid-19 restrictions. The Group will continue to closely monitor and manage the potential impact
of ongoing supply chain disruption including port congestion and shipping line capacity constraints,
noting that these factors present some risk to the achievement of forecast case sales in 2022.
DELEGAT ANNUAL REPORT 2021 ACTING MANAGING DIRECTOR’S REPORT18
OUR PEOPLE
As noted earlier in this report, we are extremely proud and appreciative of the way our people
brought to life our core value of Winning Together in a challenging year. Our people are the key to
realising the Group’s future goals and have collectively built a high performance team culture that is
unique in the global wine business. I would like to take this opportunity to thank each and every one
of our people around the world.
GRAEME LORD ACTING MANAGING DIRECTOR
BAROSSA VALLEY ESTATE AUSTRALIA
Table 5 GROUP OUTLOOK CASE SALES
2021 2022 2023 2024
Case Sales (000s) Actual Forecast Projection Projection
Total Cases 3,178 3,419 3,734 3,976
ACTING MANAGING DIRECTOR’S REPORT DELEGAT ANNUAL REPORT 2021 19
OYSTER BAY MERLOT 2019
Awarded 91 points – 2021 International Wine Challenge, London
DELEGAT MERLOT 2019
Awarded 92 points - 2021 International Wine Challenge, London
BAROSSA VALLEY ESTATE SHIRAZ 2019
Awarded 90 points - 2021 International Wine Challenge, London
Oyster Bay was voted by consumers as
NEW ZEALAND’S MOST TRUSTED WINE BRAND
2021 New Zealand’s Readers Digest
Oyster Bay was awarded the
‘HOT BRAND’ AWARD FOR THE 11TH YEAR IN A ROW
2021 New York’s IMPACT Magazine
Barossa Valley Estate
Cabernet Sauvignon 2019
was awarded 95 points and
a gold medal at the 2021
International Wine
Challenge, London.
AWARDS AND ACCOLADES
DELEGAT ANNUAL REPORT 2021 AWARDS AND ACCOLADES20
The Board of Delegat Group Limited is responsible for the strategic direction of the Group and ensuring
the Group is managed to protect and enhance Shareholders and other stakeholders’ interests.
Some of the key responsibilities of the Board include:
• Adopting the strategic plans of the Group, set by the Acting Managing Director in conjunction
with the Group’s senior management team;
• Monitoring the Group’s operational and financial performance;
• Ensuring the Group develops effective policies and procedures concerning disclosure of
important information to the market and Shareholders;
• Setting and monitoring high standards of ethical behaviour in the Group; and
• Oversight of the Group’s people and culture policies and strategies, including: remuneration,
health and safety, succession and development, diversity and inclusion.
The Board has adopted what it believes are appropriate corporate governance policies and
procedures, which it periodically reviews to ensure that the Group’s responsibilities and obligations
are met. The principal corporate governance policies concern:
• The appointment and retirement of Directors;
• The composition and performance of the Board;
• The balance between Executive and Non-Executive Directors;
• Directors’ access to independent professional advice; and
• The constitution and operation of Board Committees, which comprise Directors, and in some
cases, by invitation, representatives of the Group’s senior management team. The Board has
formally constituted an Audit and Risk Committee and a Remuneration Committee.
The Board currently comprises five Directors, three of whom are non-executive (Rose Delegat, Alan
Jackson and Phillipa Muir); three of whom are non-independent (Jim Delegat, Rose Delegat, Graeme
Lord); and two of whom are independent (Alan Jackson, Phillipa Muir), as defined in the NZX Listing
Rules.
The Board of Delegat Group Limited meets formally a minimum of six times during the financial year
and holds additional meetings as required to deal with specific matters of the Group.
BOARD OF DIRECTORS 2021
DELEGAT ANNUAL REPORT 2021 BOARD OF DIRECTORS22
GRAEME LORD Acting Managing Director
Graeme Lord is the Acting Managing Director of Delegat Group
Limited. Graeme is responsible for developing growth plans,
building a high performing organisation and executing business
plans. He originally joined Delegat in 1999, holding senior
executive roles in strategy, marketing and sales leadership roles,
and from 2014 to 2018 was the Managing Director. Graeme was
appointed a non-executive Director of Delegat Group Limited in
July 2020. Graeme was previously CEO of Macpac Wilderness
Equipment, and a Consultant with The Boston Consulting
Group. He is a member of the Institute of Directors.
JAKOV (JIM) DELEGAT Executive Chairman
Jim Delegat is the Executive Chairman of Delegat Group Limited
and has been on the Board since the Company listed in 2006. He
is responsible for providing strategic direction and monitoring
performance to ensure successful delivery of Board-approved
business plans. He has been involved in the New Zealand wine
industry all his working life and is thoroughly experienced in every
aspect of the business. Jim is one of only a handful of second-
generation family wine producers in the country. Active in industry
affairs, he has been a Director of both the Wine Institute of New
Zealand and New Zealand Winegrowers, having previously served
on the Board of the Wine Institute of New Zealand for more than
13 years. Jim is a member of the Institute of Directors.
ROSEMARI (ROSE) DELEGAT Non-Executive Director
Rose Delegat is a Non-Executive Director of Delegat Group
Limited and has been on the Board since the Company listed in
2006. The Group continues to benefit from Rose’s experience
and the expertise that she has given to the Company for more
than 35 years. She was responsible for initiating the Group’s
drive into export markets in the 1980s and was the inaugural
Chairperson (1987 – 1990) of the special United Kingdom
Exporting Group, part of the Wine Institute of New Zealand.
Rose is a member of the Institute of Directors.
BOARD OF DIRECTORS DELEGAT ANNUAL REPORT 2021 23
PHILLIPA MUIR Non-Executive Independent Director
Phillipa Muir is a Non-Executive Director of Delegat Group
Limited and joined the Board in 2020. Phillipa is currently also
Chair of Fletcher Building’s Employee Educational Fund, Chair
of the Auckland Writers Festival Trust and a senior partner of
law firm Simpson Grierson, where she heads the firm’s national
Employment Law Group and acts across a wide range of industry
sectors. Phillipa was awarded the Excellence in Governance
Award at the NZ Women in Governance Awards 2018 and has
held a number of previous governance roles. She is a member of
the Institute of Directors.
Dr ALAN JACKSON Non-Executive Independent Director
Dr Alan Jackson is a Non-Executive Director of Delegat Group
Limited and has been on the Board since 2012. Alan was, until
2009, Chairman Australasia, Senior Vice President and Director
of The Boston Consulting Group. He has been an international
management consultant since 1987 with The Boston Consulting
Group and has proven experience at the most senior levels of
international and government business. Alan has worked across
a range of industries internationally, including consumer goods
companies, supermarkets and retailers, in addition to industrial and
resource companies. He headed The Boston Consulting Group’s
Consumer Goods and Retail practice in Australasia and Asia Pacific.
Alan is a Fellow of the Institution of Professional Engineers and a
Chartered fellow of the New Zealand Institute of Directors.
DELEGAT ANNUAL REPORT 2021 BOARD OF DIRECTORS24
The Directors are responsible for ensuring that the financial statements give a true and fair view of
the financial position, financial performance and cash flows for the Group as at 30 June 2021.
The Directors consider that the financial statements of the Group have been prepared using
appropriate accounting policies, consistently applied and supported by reasonable judgements and
estimates and that all relevant financial reporting and accounting standards have been followed.
The Directors believe that proper accounting records have been kept which enable, with reasonable
accuracy, the determination of the financial position and financial performance of the Group and the
compliance of the financial statements with the Financial Markets Conduct Act 2013 and Financial
Reporting Act 2013.
The Directors consider they have taken adequate steps to safeguard assets of the Group.
The Directors have pleasure in presenting the following financial statements for the year ended
30 June 2021.
The Board of Directors of the Group authorised these financial statements for issue on 27 August
2021.
For, and on behalf of, the Board.
J I M D E LEG AT
EXECUTIVE CHAIRMAN
GRAEME LORD
ACTING MANAGING DIRECTOR
27 August 2021
OYSTER BAY VINEYARD, MARLBOROUGH, NEW ZEALAND
DIRECTORS’ RESPONSIBILITY STATEMENT 2021
DIRECTORS’ RESPONSIBILITY STATEMENT DELEGAT ANNUAL REPORT 2021 25
STATEMENT OF FINANCIAL PERFORMANCE
Notes 2021 2020
$000 $000
Restated*
Revenue 3 305,376 304,181
Profit before finance costs 4 95,311 97, 6 3 9
Finance costs 3 9,777 10,807
Profit before income tax 85,534 86,832
Income tax expense 17 23,365 21,405
Profit for the year attributable to Shareholders of the Parent Company 62,169 65,427
Earnings per share
– Basic and fully diluted earnings per share (cents per share) 5 61.47 64.70
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202126
STATEMENT OF OTHER COMPREHENSIVE INCOME
Notes 2021 2020
$000 $000
Restated*
Profit after income tax 62,169 65,427
Other comprehensive income that may subsequently be classified to the profit and loss:
– Translation of foreign subsidiaries 6b (958) 1,497
– Net loss on hedge of a net investment (108) (722)
– Income tax relating to components of other comprehensive income 17 30 202
Total comprehensive income for the year, net of tax 61,133 66,404
Comprehensive income attributable to Shareholders of the Parent Company 61,133 66,404
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202127
STATEMENT OF CHANGES IN EQUITY
Notes
Share
Capital
$000
Foreign
Currency
Translation
Reserve
$000
Retained
Earnings
$000
Total
Equity
$000
Balance at 30 June 2020 49,815 (2,604) 363,295 410,506
Changes in equity for the year ended 30 June 2021
Other comprehensive income
– Translation of foreign subsidiaries 6b – (958) – (958)
– Net loss on hedge of a net investment – (108) – (108)
– Income tax relating to components of
other comprehensive income 17 – 30 – 30
Total other comprehensive income – (1,036) – (1,036)
– Net profit for the year – – 62,169 62,169
Total comprehensive income for the year – (1,036) 62,169 61,133
Equity transactions
– Dividends paid to Shareholders 7 – – (17,217) (17,217)
Balance at 30 June 2021 49,815 (3,640) 408,247 454,422
The accompanying notes form part of these financial statements
FOR THE YEAR ENDED 30 JUNE 2021
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202128
STATEMENT OF CHANGES IN EQUITY CONTINUED
Notes
Share
Capital
$000
Foreign
Currency
Translation
Reserve
$000
Retained
Earnings
$000
Total
Equity
$000
Balance at 30 June 2019 49,815 (3,581) 315,083 361,317
Changes in equity for the year ended 30 June 2020
Other comprehensive income
– Translation of foreign subsidiaries 6b – 1,497 – 1,497
– Net loss on hedge of a net investment – (722) – (722)
– Income tax relating to components of
other comprehensive income 17 – 202 – 202
Total other comprehensive income – 977 – 977
– Net profit for the year – – 65,427 65,427
Total comprehensive income for the year – 977 65,427 66,404
Equity transactions –
– Dividends paid to Shareholders 7 – – (17,215) (17,215)
Balance at 30 June 2020 49,815 (2,604) 363,295 410,506
FOR THE YEAR ENDED 30 JUNE 2020 RESTATED*
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202129
STATEMENT OF FINANCIAL POSITION
Notes 2021 2020
$000 $000
Restated*
Equity
Share capital 6 49,815 49,815
Foreign currency translation reserve 6b (3,640) (2,604)
Retained earnings 408,247 363,295
Total Equity 454,422 410,506
Liabilities
Current Liabilities
Trade payables and accruals 8 28,898 27,879
Derivative financial instruments 9 2,879 4,649
Income tax payable 8,235 9,674
Lease liability 16 4,840 4,538
44,852 4 6,74 0
Non-Current Liabilities
Deferred tax liability 17 31,872 30,435
Derivative financial instruments 9 1,590 5,900
Interest-bearing loans and borrowings 10 258,001 254,296
Lease liability 16 93,863 79,524
385,326 370,155
Total Liabilities 430,178 416,895
Total Equity and Liabilities 884,600 827,401
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. AS AT 30 JUNE 202130
STATEMENT OF FINANCIAL POSITION CONTINUED
Notes 2021 2020
$000 $000
Restated*
Assets
Current Assets
Cash and cash equivalents 8,943 14,755
Trade and other receivables 11 43,997 41,788
Derivative financial instruments 9 271 3,618
Inventories 12 159,982 152,840
Biological work in progress 13 12,080 12,693
225,273 225,694
Non-Current Assets
Property, plant and equipment 14 582,143 537,708
Right-of-use assets 16 71,335 58,494
Intangible assets 15 5,849 5,436
Derivative financial instruments 9 – 69
659,327 601,707
Total Assets 884,600 827,401
For, and on behalf of, the Board, who authorised the issue of the financial statements on 27 August 2021.
JN Delegat, Executive Chairman GS Lord, Acting Managing Director
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. AS AT 30 JUNE 202131
STATEMENT OF CASH FLOWS
2021 2020
$000 $000
Operating Activities
Cash was provided from
Receipts from customers 300,556 300,923
Net GST received 603 307
301,159 301,230
Cash was applied to
Payments to suppliers and employees 193,767 189,173
Net interest paid 9,300 10,037
Net income tax paid 23,370 17,707
226,437 216,917
Net Cash Inflows from Operating Activities 74,722 84,313
Investing Activities
Cash was provided from
Proceeds from sale of property, plant and equipment 60 45
Dividends received 1 1
61 46
Cash was applied to
Purchase of property, plant and equipment 60,375 27,176
Purchase of intangible assets 494 424
Capitalised interest paid 1,325 1,460
62,194 29,060
Net Cash Outflows from Investing Activities (62,133) (29,014)
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202132
STATEMENT OF CASH FLOWS CONTINUED
2021 2020
$000 $000
Financing Activities
Cash was provided from
Proceeds from borrowings 53,787 10,290
53,787 10,290
Cash was applied to
Dividends paid to Shareholders 17, 2 0 8 17, 2 0 4
Borrowing facility fees - 989
Repayment of borrowings 50,628 33,826
Repayment of lease liability 4,179 4,573
72,015 56,592
Net Cash Outflows from Financing Activities (18,228) (46,302)
Net (Decrease)/Increase in Cash Held (5,639) 8,997
Cash and cash equivalents at beginning of the year 14,755 5,647
Effect of exchange rate changes on foreign currency balances (173) 111
Cash and Cash Equivalents at End of the Year 8,943 14,755
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202133
STATEMENT OF CASH FLOWS CONTINUED
2021 2020
$000 $000
Restated*
Reconciliation of Profit for the Year with Cash Flows from Operating Activities
Reported profit after tax 62,169 65,427
Add/(deduct) items not involving cash flows
Depreciation expense 22,998 21,629
Other non-cash items (516) 1,569
Gain on disposal of assets (19) (71)
Movement in derivative financial instruments (2,664) (1,331)
Movement in deferred tax liability 1,437 277
21,236 22,073
Movement in working capital balances are as follows
Trade payables and accruals 1,019 (4,432)
Trade and other receivables (2,209) (1,804)
Inventories ( 7,14 2) 766
Biological work in progress 613 (2,328)
Income tax (1,439) 3,229
Add items classified as investing and financing activities
Capital purchases included within trade payables and inventories 475 393
Borrowing facility fees – 989
(8,683) (3,187)
Net Cash Inflows from Operating Activities 74,722 84,313
Reconciliation of movement in Net Debt:
Opening balance at 1 July 239,541 270,342
Per statement of cash flows:
– Proceeds from/(Repayment of) borrowings 3,159 (23,536)
– Net Decrease/(Increase) in cash held 5,639 (8,997)
Foreign exchange movement 400 1,413
Other
non-cash movements 319 319
Closing balance at 30 June 249,058 239,541
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
The accompanying notes form part of these financial statements
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202134
NOTES TO THE FINANCIAL STATEMENTS
1. GENERAL INFORMATION
REPORTING ENTITY
The financial statements presented are those of Delegat Group Limited and its subsidiaries (the Group). Delegat
Group Limited is a company limited by shares, incorporated and domiciled in New Zealand and registered under the
Companies Act 1993. The Parent shares are publicly traded on the New Zealand Stock Exchange.
The financial statements comprise the statement of financial performance, statement of other comprehensive
income, statement of changes in equity, statement of financial position and statement of cash flows, as well as the
notes to the financial statements. The financial statements for the Group for the year ended 30 June 2021 were
authorised for issue in accordance with a resolution of the Directors on 27 August 2021.
BASIS OF PREPARATION
The financial statements have been prepared in accordance with Generally Accepted Accounting Practice in New
Zealand (NZ GAAP) and the requirements of the Financial Markets Conduct Act 2013. For the purposes of complying
with NZ GAAP, the entity is a for-profit entity. These financial statements are presented in New Zealand Dollars,
rounded to the nearest thousand. They are prepared on a historical cost basis, except for derivative financial
instruments and biological produce which have been measured at fair value.
The preparation of the financial statements requires the Group to make judgements, estimates and assumptions that
affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates
and associated assumptions are based on historical experience and various other factors that are believed to be
reasonable under the circumstances. Actual results may vary from these estimates. The estimates and underlying
assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in
which the estimates are revised if the revision affects only that period, or in the period of revision and future periods
if the revision affects both current and future periods.
S TATE M E NT O F C O M PLI A N C E
The financial statements comply with New Zealand equivalents to International Financial Reporting Standards and
other applicable Financial Reporting Standards (NZ IFRS), as applicable to the Group as a profit-oriented entity. The
financial statements comply with International Financial Reporting Standards (IFRS).
BASIS OF CONSOLIDATION
The consolidated financial statements comprise the financial statements of the Group as at 30 June 2021 and
comparative as at 30 June 2020.
Subsidiaries are those entities over which the Group has control. Control is achieved when the Group is exposed, or
has rights, to variable returns from its investment in the entity, and has the ability to affect those returns through its
power over the entity. Specifically, the Group controls an entity if, and only if, the Group has:
– Power over the entity (i.e. existing rights that give it the current ability to direct the relevant activities of the investee);
– Exposure, or rights, to variable returns from its involvement with the entity; and
– The ability to use its power over the investee to affect its returns.
The financial statements of the subsidiaries are prepared for the same reporting period as the Parent, using consistent
accounting policies. The effects of intercompany transactions are eliminated in preparing the consolidated financial
statements.
Subsidiaries are fully consolidated from the date on which control is obtained by the Group and cease to be
consolidated from the date on which control is transferred out of the Group. The acquisition of subsidiaries is
accounted for using the acquisition method of accounting as noted on the following pages.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202135
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
BUSINESS COMBINATIONS
The acquisition method of accounting is used to account for all business combinations regardless of whether
equity instruments or other assets are acquired. Cost is measured as the fair value of the assets given, shares
issued or liabilities incurred or assumed at the date of exchange. Where equity instruments are issued in a business
combination, the fair value of the instruments is their published market price at the date of the exchange, unless, in
rare circumstances, it can be demonstrated that the published price at the date of exchange is an unreliable measure
of fair value. Transaction costs arising on the issue of equity instruments are recognised directly within equity.
Except for non-current assets or disposal groups classified as held for sale (which are measured at fair value
less costs to sell), all identifiable assets acquired and liabilities and contingent liabilities assumed in a business
combination are measured initially at their fair values as at acquisition date, irrespective of the extent of any non-
controlling interests. The excess of the cost of the business combination over the net fair value of the Group’s share
of the identifiable net assets acquired is recognised as goodwill. If the cost of the acquisition is less than the Group’s
share of the net fair value of the identifiable net assets of the subsidiary, the difference is recognised as a gain in the
statement of financial performance, but only after a reassessment of the identification and measurement of the net
assets acquired.
Where settlement of any part of the consideration is deferred, the amounts payable in the future are discounted to
the present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being
the rate at which similar borrowings could be obtained from an independent financier under comparable terms and
conditions.
GOODS AND SERVICES TAX (GST)
The statement of financial performance, statement of other comprehensive income, statement of changes in equity
and statement of cash flows have been prepared so that all components are stated net of GST. All items in the
statement of financial position are stated net of GST, with the exception of receivables and payables, which include
GST invoiced.
FOREIGN CURRENCIES
a) Functional and Presentation Currency
The presentation currency of the Group is the New Zealand Dollar. Each subsidiary company in the Group determines
its own functional currency and uses that functional currency for its individual financial statements. Subsidiary
companies with a different functional currency than that of the Group are translated through converting all reported
assets and liabilities at the closing rate at the date of the balance sheet, while income and expenses are translated
at exchange rates at the dates of the transactions. Any resulting exchange differences are recognised as a separate
component of equity.
b) Transactions and Balances
Transactions in foreign currencies are initially recorded in the functional currency by applying the exchange rates
ruling at the date of the transaction. Assets and liabilities denominated in foreign currencies are translated at the
rate of exchange ruling at the balance sheet date.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents in the statement of financial position comprise cash at bank and in hand, and short-term
deposits with an original maturity of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of change in value. For the purposes of the statement of cash flows, cash
and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts.
Bank overdrafts are included within interest-bearing loans and borrowings in current liabilities in the statement of
financial position.
1. GENERAL INFORMATION (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202136
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
NET DEBT
Net debt is the sum of the Group’s interest-bearing loans and borrowings less cash and cash equivalents.
OTHER ACCOUNTING POLICIES
Other accounting policies that are relevant to an understanding of the financial statements are provided throughout
the notes to the financial statements.
SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS
In applying the Group’s accounting policies, management continually evaluates the judgements, estimates and
assumptions based on experience and other factors, including expectations of future events that may have an
impact upon the Group. All judgements, estimates and assumptions made are believed to be reasonable based upon
the most current set of circumstances available to management. The actual results may differ from the judgements,
estimates and assumptions used. The significant judgements, estimates and assumptions made by management in
the preparation of these financial statements are disclosed within the specific financial statement notes as shown
below:
Area of Judgement, Estimate or Assumption
Selling, marketing and promotional accruals
Fair value of grapes at point of harvest
Estimation of useful lives of assets
Impairment of property, plant and equipment
Impairment of intangible assets
Lease term and discount rates
Note
Note 3 Segmental Reporting
Note 12 Inventories
Note 14 Property, Plant and Equipment
Note 14 Property, Plant and Equipment
Note 15 Intangible Assets
Note 16 Leases
To allow the Accounting Policies and Significant Accounting Judgements, Estimates and Assumptions to be easily
identified within the notes, Accounting Policies have been identified with an
symbol, and Significant Accounting
Judgements, Estimates and Assumptions with an
symbol.
CHANGES IN ACCOUNTING POLICIES
The accounting policies adopted are consistent with those of the previous financial year, with the exception of
growing costs as detailed below.
Growing Costs
An adjustment has been made to restate the 2020 comparatives to align the accounting treatment for growing costs.
Previously a distinction was made between where the Group maintains beneficial ownership in bearer plants and
where the Group is not the beneficial owner of bearer plants. All vineyard costs that are incurred subsequent to
harvest up to balance sheet date are now treated consistently and are carried forward in the Statement of Financial
Position and included in the subsequent year’s fair value adjustment at point of harvest.
1. GENERAL INFORMATION (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202137
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
This adjustment has resulted in the following restatements:
2020
$000
Statement of Financial Performance
Profit before finance costs 1,815
Income tax expense 510
Statement of Financial Position
Retained earnings 5,926
Deferred tax liability 1,979
Inventories (4,788)
Biological work in progress 12,693
Statement of Cash Flows
Reconciliation of Profit for the Year with Cash Flows from Operating Activities
Reported profit after tax 1,305
Movement in deferred tax liability 510
Inventories 513
Biological work in progress (2,328)
Basic and fully diluted earnings per share for the year ended 30 June 2020 have increased by 1.29 cents per share.
Retained earnings as at 1 July 2019 increased by $4,621,000.
NEW ACCOUNTING STANDARDS AND INTERPRETATIONS
Standards and Interpretations that have recently been issued or amended, but are not yet effective, have not been
adopted by the Group for the annual report period ending 30 June 2021.
The Group is in the process of assessing the accounting for upfront configuration and customisation costs incurred
in system implementations, and the on-going costs of Software as a Service (SaaS) arrangements, in response to
the agenda decisions published by the IFRIC clarifying its interpretation of how current accounting standards apply
to these types of arrangements.
As at 30 June 2021, a carrying amount of $1.2 million has been recognised as property, plant and equipment in respect
of configuration and customisation costs incurred in implementing SaaS arrangements. Due to the complexity of
historical SaaS projects, the Group is still in the process of obtaining the required information to analyse the impact
of the Group’s change in accounting policy in respect of these SaaS arrangements. The Group expects it is likely
that the analysis will be completed over the coming months and the restatement, following the change in accounting
policy, will be presented in the Interim report for the half-year period ending 31 December 2021.
There are other standards, amendments and interpretations which have been approved by the External Reporting
Board (XRB) but are not yet effective. The Group expects to adopt these other standards when they become
mandatory. None are expected to materially impact the Group’s financial statements although may result in
disclosure changes.
Increase/
(decrease)
1. GENERAL INFORMATION (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202138
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
COVID-19
The effects of Covid-19 continue to have an impact on the financial performance on Delegat’s business, primarily
associated with the global supply chain disruption and getting inventory to customers. Lockdowns and social
distancing requirements have limited field sales activities and significantly reduced sales in on-premise channels.
In FY21 these negative impacts were partially offset by certain in-market operating expenses that were not able to
be incurred.
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group’s principal financial liabilities comprise interest-bearing loans and borrowings, lease liabilities, and trade
payables and accruals. The main purpose of these financial liabilities is to raise funding for the Group’s ongoing
operations. The Group also has financial assets such as trade and other receivables, and cash and cash equivalents,
which arise directly from its operations.
The Group is counterparty to derivative financial instruments, principally being foreign currency forward exchange
contracts and options, and interest rate swaps. The purpose of entering into foreign currency forward exchange
contracts and options is to manage currency risk primarily arising from foreign denominated trade receivables.
Interest rate swaps are entered into with the aim of mitigating interest rate risk to movements on floating rate debt
facilities.
The main risks arising from the Group’s financial instruments are foreign currency risk, interest rate risk, credit risk
and liquidity risk. Each of the main operational risks are reviewed by the Treasury Management Committee (TMC)
and their recommendations are provided to the Board of Directors. The composition of the TMC includes the Chief
Financial Officer, Group Financial Controller, Group Financial Planning Manager and Independent Treasury Advisors.
The Board reviews and agrees policies for managing each of these risks as summarised below. Board approval is
required for any movement outside policy.
FOREIGN CURRENCY RISK
The net assets employed through subsidiary companies based overseas exposes the Group to foreign currency risk
as a result of changes in the GBP/NZD, AUD/NZD, USD/NZD, EUR/NZD, CAD/NZD, SGD/NZD, JPY/NZD, HKD/NZD
and CNY/NZD exchange rates. The Group also has foreign currency risk resulting from sales of product in a currency
which is other than that of the New Zealand Dollar. Profits from each export region are repatriated and reported in
New Zealand Dollars and the Group is exposed to changes in foreign exchange rates.
To minimise foreign currency risk, the Group enters into forward exchange contracts and options for foreign
denominated sales at levels which are considered to be highly probable. The Group attempts to maintain foreign
currency cover of between 75% to 100% of highly probable sales in one to three months, 50% to 75% for highly
probable sales in four to six months, 25% to 50% for highly probable sales in seven to 12 months, 0% to 50% for sales
between 13 to 18 months and between 0% to 25% for sales thereafter. The Group has the option of increasing foreign
exchange cover to 100% for any time period upon approval by the Board of Directors.
When the Group is exposed to foreign currency risk as a result of being contractually committed to purchase capital
items from an overseas supplier and such expenditure is expected to exceed $200,000, the Group’s policy is to
ensure the foreign currency exposure is covered in full. Any capital expenditure below $200,000 is to be covered at
the discretion of the TMC, based on such factors as timing for payment and expected volatility of currency markets.
It is the Group’s policy that in no instance is trading for speculative purposes permitted.
1. GENERAL INFORMATION (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202139
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
At 30 June 2021, had the New Zealand Dollar (NZD) moved as illustrated in the following table with all other variables
held constant, post-tax profit and equity would have been affected as follows:
IMPACT ON 2021 REPORTED IMPACT ON 2020 REPORTED
Post-Tax Equity Post-Tax Equity
Profits Profits
Group $000 $000 $000 $000
NZD/USD +5% 1,529 1,529 1,292 1,292
NZD/USD -5% (1,733) (1,733) (1,307) (1,307)
NZD/GBP +5% 1,599 1,599 1,494 1,494
NZD/GBP -5% (1,957) (1,957) (1,175) (1,175)
NZD/AUD +5% 400 (681) 546 (530)
NZD/AUD -5% (482) 712 (751) 439
NZD/CAD +5% 390 390 168 168
NZD/CAD -5% (577) (577) (197) (197)
NZD/EUR +5% (52) (52) (39) (39)
NZD/EUR -5% 58 58 43 43
The above table calculates the impact of a change in foreign exchange rates on closing equity and post-tax profits
of the Group, as a result of the Group being counterparty to transactions which are foreign currency denominated.
Foreign currency denominated balances include trade and other receivables, trade payables and accruals, loans
and borrowings, cash on hand, and unsettled foreign exchange contracts that exist at balance sheet date. The net
foreign currency exposure is determined in aggregate and the impact on post-tax profits determined as a result of a
+/- 5% movement in foreign exchange rates. A +5% movement reflects the strengthening of the NZD relative to the
other currency, whereas a -5% movement reflects the weakening of the NZD relative to the other currency.
The impact upon the Group’s equity balance is derived through determining the impact on post-tax profits as noted
above.
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
Increase/
(decrease)
Increase/
(decrease)
Increase/
(decrease)
Increase/
(decrease)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202140
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
HEDGE OF NET INVESTMENT IN FOREIGN OPERATION
For hedges of a net investment in a foreign operation, the effective portion of the gain or loss on the
hedging instrument is recognised in the statement of other comprehensive income and accumulated in
the foreign currency translation reserve, while any ineffective portion is recognised immediately in the
statement of financial performance. On disposal of the foreign operation, the cumulative amount of any
such gains or losses accumulated within equity is transferred to the statement of financial performance.
The net assets employed in Barossa Valley Estate Pty Limited (BVE) exposes the Group to foreign currency risk as a
result of changes in the AUD/NZD exchange rate.
The foreign currency movement on translation of the net assets of BVE is included in the statement of other
comprehensive income. Since the acquisition of BVE the Group has maintained a portion of their external borrowings
in AUD to mitigate this risk. The foreign exchange movement on these external borrowings in the absence of hedge
accounting is included in the statement of financial performance.
External borrowings of A$29,350,000 have been designated as a hedge of the net investment in BVE. Gains or
losses on the retranslation of this borrowing are transferred to the statement of other comprehensive income to
offset any gains or losses on translation of the net assets of BVE. There is no hedge ineffectiveness in the year ended
30 June 2021.
INTEREST RATE RISK
The Group’s exposure to the risk of changes in market interest rates relates primarily to the Group’s long-term and
short-term debt obligations with interest payable based on floating rates of interest. Interest rate risk is monitored
by the TMC on an ongoing basis. The recommendation by the TMC to enter into fixed or variable rate debt facilities
and decisions to retire existing debt instruments is made after consideration of the economic indicators impacting
upon the overnight cash rate, which influences the rates of interest charged by financial institutions. All funding
facilities recommended by the TMC must be approved by the Board of Directors.
The Group manages interest rate risk through maintaining a mix of debt instruments having variable and fixed
interest rates. The Group’s policy is to maintain a level of fixed debt facilities between 40% to 100% of core debt for
a period of one year, between 30% to 80% of projected core debt for periods of one to three years, and between 0%
to 60% of projected core debt facilities for three to five years.
The Group also manages interest rate risk through being counterparty to a series of interest rate swaps. The Group
agrees to settle or has the option to exchange, at specified dates, the difference between fixed and variable rate
interest amounts calculated by reference to an agreed upon notional principal amount. These are discussed in Note
9: Derivative Financial Instruments.
The table below demonstrates the sensitivity to a reasonably possible change in interest rates, with all other variables
held constant, on the Group’s post-tax profits and equity:
IMPACT ON 2021 REPORTED IMPACT ON 2020 REPORTED
Post-Tax Equity Post-Tax Equity
Profits Profits
Group $000 $000 $000 $000
2.00% Increase – 200 basis points
(2020: 2.00% Increase – 200 basis points) 1,169 1,169 3,012 3,012
0.25% Decrease – 25 basis points
(2020: 0.25% Decrease – 25 basis points) (146) (146) (377) (377)
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202141
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
The key assumptions which impact upon the values presented in the above table are the following:
– Cash and cash equivalents include deposits on call which are at floating interest rates. The estimated impact
upon interest revenues from these sources is based upon amounts held on deposit remaining at consistent
levels as reported at the balance sheet date. For foreign denominated deposits, the impact on foreign exchange
is based on the conversion rate existing at balance sheet date.
– Account balances that are trade receivables or trade payables are generally on 30 to 90 day terms and are non-
interest bearing and are not subject to interest rate risk.
– The impact upon the fair value of the interest rate swaps is based upon the differential in rates between the
Group paying a fixed rate of interest and receiving the floating New Zealand Bank Bill Rate (BKBM) multiplied by
the nominal amount under the swap agreement up until maturity.
– Interest payable on bank debt is based upon the BKBM/BBSY, plus a margin. The margin is dependent upon the
Group achieving certain financial covenants and the margin ranges from 1.02% to 1.50%. The analysis assumes
that the margin and principal are held constant at the same rate as at the balance sheet date with the sensitivity
calculating the effect on interest expense of movements in the BKBM/BBSY rate. The analysis excludes any
future interest that would be capitalised as part of long-term assets.
– Included in the above table is the change in fair value of interest rate swaps, which results from changes in the
floating interest rate.
CREDIT RISK
The Group trades with recognised and creditworthy third parties. It is the Group’s policy that all customers who
wish to trade on credit terms are subject to credit verification procedures. Receivable balances are monitored on
an ongoing basis. The maximum exposure to the carrying amount of receivable balances is disclosed in Note 11. The
Group does not have any significant concentrations of credit risk.
LIQUIDITY RISK
Liquidity risk is the risk that an unforeseen event or miscalculation in the required liquidity level may lead to the
Group being unable to meet its day to day funding obligations. To minimise liquidity risk, the Group’s policy is to
maintain committed funding facilities at a minimum of 105% of the projected peak debt level over the next 12 months
(excluding the cash requirements for any business combinations).
A General Security Agreement exists in favour of Westpac New Zealand Limited, Westpac Banking Corporation,
Bank of New Zealand Limited, China Construction Bank (New Zealand) Limited, and Hongkong and Shanghai
Banking Corporation Limited to secure amounts loaned to the Group. The General Security Agreement covers the
existing and future assets of Delegat Group Limited, Delegat Limited, Delegat Australia Pty Limited, and Barossa
Valley Estate Pty Limited. The amount of the guarantee in respect of the banking facilities is not included in the
above table and is the lower value of the net assets of the Group and the aggregate of the loans advanced at balance
date. Loan facilities are disclosed in Note 10.
The table below presents all contractual payments which the Group is legally obliged to make and includes all future
interest payments on interest-bearing facilities. The interest cost has been estimated by maintaining the current
principal balance and interest rates that exist at balance sheet date. The table also includes the New Zealand Dollar
equivalent for the foreign currency amounts, which are to be delivered to fulfil obligations under foreign currency
contracts.
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202142
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
Facility Type
30 June 2021
Facility
Limit
$000
Drawn at
Balance Sheet
Date
$000
< 1 year
$000
1 to 2 years
$000
> 2 years
$000
Working Capital facility 48,000 23,676 363 23,706 –
Term facility (multi-currency) 220,000 199,784 2,717 200,007 –
Headroom facility 20,000 – – – –
Term facility (AUD) 42,942 34,890 391 34,922 –
Lease liability N/A 98,703 10,492 10,086 145,617
Low value asset leases N/A N/A 5,559 3,799 4,279
Derivative financial instruments N/A N/A 122,223 7,552 395
Trade payables and accruals N/A 27,186 27,186 – –
Financial guarantee contracts N/A N/A 143 – –
As at 30 June 2021 330,942 384,239 169,074 280,072 150,291
Included in the table above are financial guarantees which are presented at their highest possible amount that can
be called at balance date. For each individual guarantee, if the obligation at balance date is lower than the maximum
amount callable under the guarantee then the lower value has been included. The guarantees can be called in favour
of the beneficiary if certain acts of non-performance occur. The Directors consider the likelihood of each financial
guarantee being called remote.
Facility Type
30 June 2020
Facility
Limit
$000
Drawn at
Balance Sheet
Date
$000
< 1 year
$000
1 to 2 years
$000
> 2 years
$000
Working Capital facility 48,000 – – – –
Term facility (multi-currency) 220,000 220,196 2,881 2,881 220,432
Headroom facility 20,000 – – – –
Term facility (AUD) 42,794 34,771 410 410 34,804
Lease liability N/A 84,062 9,990 8,959 133,437
Low value asset leases N/A N/A 5,889 4,503 3,937
Derivative financial instruments N/A N/A 100,430 7,078 2,889
Trade payables and accruals N/A 27,286 27,286 – –
Financial guarantee contracts N/A N/A 186 – –
As at 30 June 2020 330,794 366,315 147,072 23,831 395,499
All of the above facilities have a floating rate of interest which is tied to the New Zealand BKBM for NZD facility/
Australian BBSY for AUD facility plus margin. At balance sheet date the Group has interest rate swaps that cover
$140,258,000 (2020: $137,620,000) of the principal balance drawn at balance sheet date. Refer to Note 9.
The Group maintains credit facilities at a level sufficient to fund the Group’s working capital during the period
between cash expenditure and cash inflow.
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202143
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
SUMMARY OF FINANCIAL INSTRUMENTS HELD
At the balance sheet date the Group reports the following categories of financial instruments:
2021 2020
$000 $000
Financial Assets
Financial assets at amortised cost 51,102 55,222
Financial assets at fair value through profit and loss 271 3,687
51,373 58,909
Financial Liabilities
Financial liabilities at amortised cost 378,056 359,627
Financial liabilities at fair value through profit or loss 4,469 10,549
382,525 370,176
The Group does not have any financial assets or liabilities that are classified as fair value through other comprehensive
income (FVOCI).
FAIR VALUE OF FINANCIAL INSTRUMENTS
The fair value of financial instruments is presented in the previous table. For financial instruments measured at
fair value, further disclosure is required that allocates the fair values into a measurement hierarchy. The following
principles have been applied in classifying these instruments:
Level 1 – the fair value is calculated using quoted prices in active markets;
Level 2 – the fair value is estimated using inputs other than quoted prices included in Level 1 that are observable for
the asset or liability, either directly (as prices) or indirectly (derived from prices);
Level 3 – the fair value is estimated using inputs for the asset or liability that are not based on observable market
data.
The fair value of the financial instruments as well as the methods used to estimate the fair value are summarised
below:
Level 1 Level 2 Level 3 Total
30 June 2021 $000 $000 $000 $000
Financial Assets
Foreign currency forward exchange contracts – 271 – 271
– 271 – 271
Financial Liabilities
Foreign currency forward exchange option contracts – 382 – 382
Interest rate swap contracts – 4,087 – 4,087
– 4,469 – 4,469
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202144
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
The fair value of financial instruments held at balance date that are not traded on an active market include foreign
currency forward exchange contracts and options, and net settled interest rate swap contracts. The fair values are
derived through valuation techniques that maximise the use of observable market data where it is available and
rely as little as possible on entity specific estimates. If all significant inputs come from observable market data the
instrument is included in Level 2 of the hierarchy.
Level 1 Level 2 Level 3 Total
30 June 2020 $000 $000 $000 $000
Financial Assets
Foreign currency forward exchange option contracts – 2,052 – 2,052
Foreign currency forward exchange contracts – 1,635 – 1,635
– 3,687 – 3,687
Financial Liabilities
Interest rate swap contracts – 10,549 – 10,549
– 10,549 – 10,549
FINANCIAL RISK ASSOCIATED TO BEARER PLANTS
The Group is exposed to financial risks in respect of agricultural activities. The agricultural activities of the Group
consist of the management of vineyards to produce grapes for use in the production of wine. The primary risk
borne by the Group is caused by the length of time between when cash is expended on the purchase or planting
and maintenance of grape vines and on harvesting grapes and the ultimate realisation of proceeds from the sale
of finished product (wine). The Group takes reasonable measures to ensure that the current year’s harvest is not
affected by disease, drought, frost, or other factors that may have a negative effect upon yield and quality. These
measures include consultation with experts in viticulture, frost protection measures, and ensuring that each vineyard
is managed according to a specifically developed Vineyard Management Calendar.
CAPITAL MANAGEMENT
When managing capital, management’s objective is to ensure the entity continues as a going concern as well as to
maintain optimal returns to shareholders and benefits for other stakeholders of the business. The ultimate aim is to
maintain a capital structure which provides flexibility to enable future growth of the Group while ensuring the lowest
cost of capital is available to the Group.
Management reviews the capital structure of the Group as a result of changes in market conditions which impact
upon interest and foreign exchange rates and may adjust the capital structure to take advantage of these changes.
Management has no current plans to issue further shares on the market but is intent on growing the business which
will require future funding.
The Group is subject to a series of bank covenants over its Senior Debt facilities. These are discussed in Note 10.
2. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202145
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
3. SEGMENTAL REPORTING
An operating segment is a reportable segment if the segment engages in business activities in which it
may earn revenues and incur expenses, whose operating results are regularly reviewed by the Group’s
Chief Operating Decision Maker and for which discrete financial information is available.
The Group reviews its operational performance based upon the management and the geographic areas in which
their customers are based. Financial information which is available to management in order to assess segment
performance and investment opportunities is presented on the same basis. In accordance with NZ IFRS 8: Operating
Segments this forms the basis of presentation for Segment Reporting and is in the format adopted below:
– Delegat Limited (Delegat) is party to vineyard leases and has interests in freehold land and winery infrastructure
which allows the company to grow, harvest and make finished wine to be marketed, distributed and sold into
the Super Premium wine markets. Delegat sells and markets its product through a combination of subsidiary
companies based overseas or to customers and distributors directly in the New Zealand, Canadian, Asian and
Pacific Island markets.
– Delegat Australia Pty Limited, Delegat Europe Limited and Delegat USA, Inc. act as distributors and assist in the
marketing of product in their respective geographic regions. Wines are sold all year round to all regions and the
Group considers there is no significant variations in revenues throughout the year.
The Group implements appropriate transfer pricing regimes within the operating segments on an arm’s length basis
in a manner similar to transactions with third parties.
Management monitors the operating results of its business units separately for the purpose of making resource
allocations and performance assessments. Segment performance is evaluated based on operating profit or loss,
which may be measured differently from operating profit or loss in the consolidated financial statements as segment
reporting is based upon internal management reports. The main differences are a result of some deferred tax
balances being recognised upon consolidation not being allocated to individual subsidiaries. Also inter-company
stock margin eliminations are managed on a group basis and are not allocated to operating segments.
REVENUE
Revenue is recognised when the Group satisfies its performance obligation to the customer. Satisfaction
of a performance obligation occurs when the Group has transferred a promised good to the customer
and when the customer obtains control of that good. The following specific recognition criteria have been
applied to each individual classification of revenue:
i) Sale of Goods
The primary source of revenue earned by the Group is through providing wine to third party retailers
and distributors. Revenue is recognised when control of the wine has passed to the buyer and the costs
incurred or to be incurred in respect of the transaction can be measured reliably. Control is considered
passed to the buyer at the time of delivery of goods to the customer.
ii) Interest Revenue
Revenue is recognised as interest accrues using the effective interest rate method. This is a method of
calculating the amortised cost of a financial asset and allocating the interest income over the relevant
period using the effective interest rate, which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to the net carrying amount of the financial asset.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202146
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
REVENUE
Sales are often made with volume discounts, other rebates and various other payments to customers for
promotional support. For volume discounts and other rebates not invoiced at the reporting date, these
are estimated based on agreements with customers and estimated depletions during the period. Other
payments to customers for promotional support include listing fees, mailer fees and other incentives. For
expenses that have not been invoiced at the reporting date, these are estimated based on agreements
with customers and estimated achievement of various targets by the customer. At 30 June 2021 the
Group has recognised accruals for all of these expenses of $18.1 million (2020: $22.4 million). The majority
of these amounts will be settled within the six months following balance date.
Year ended
30 June 2021
Delegat
Limited
$000
Delegat
Australia
Pty Ltd
$000
Delegat
Europe
Limited
$000
Delegat
USA, Inc.
$000
Other
Segments
10
$000
Eliminations
and
Adjustments
11
$000
Year Ended
30 June
2021
$000
Operating income
External sales
2,8
72,343 53,683 97,139 142,183 9,489 (72,212) 302,625
Internal sales 258,933 – – – 5,335 (264,268) –
Unrealised foreign
exchange (loss)/gain (7) – 218 – 1 (145) 67
Fair value gain on
derivative instruments 2,664 – – – – – 2,664
Dividend revenue 3,843 – – – 10,552 (14,377) 18
Interest revenue – – – – 2 – 2
Total segment revenues
1
337,776 53,683 97,357 142,183 25,379 (351,002) 305,376
Operating expenses
Interest expense
3
8,911 45 4 78 739 – 9,777
Depreciation
4
19,819 601 171 491 1,916 – 22,998
Income tax expense
5
20,707 472 830 835 116 405 23,365
Segment profit/(loss) 57,306 1,094 3,540 2,643 10,922 (13,336) 62,169
Assets
Segment assets
6
827,292 12,429 20,175 21,030 82,191 (78,517) 884,600
Capital expenditure
7
60,771 23 – – 931 – 61,725
Segment liabilities 404,196 6,253 9,537 4,248 40,662 (34,718) 430,178
Refer to footnotes on page 48
3. SEGMENTAL REPORTING (C O N T I N U E D)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202147
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
3. SEGMENTAL REPORTING (C O N T I N U E D)
Year ended
30 June 2020
Restated*
Delegat
Limited
$000
Delegat
Australia
Pty Ltd
$000
Delegat
Europe
Limited
$000
Delegat
USA, Inc.
$000
Other
Segments
10
$000
Eliminations
and
Adjustments
11
$000
Year Ended
30 June
2020
$000
Operating income
External sales
2,9
65,047 67,202 99,607 143,346 6,630 (79,028) 302,804
Internal sales 271,867 – – – 7,533 (279,400) –
Fair value gain on derivative
financial instruments 1,331 – – – – – 1,331
Dividend revenue 2 – – – 8 – 10
Interest revenue 13 1 – 22 – – 36
Total segment revenues
1
338,260 67,203 99,607 143,368 14,171 (358,428) 304,181
Operating expenses
Interest expense
3
9,614 57 6 105 1,025 – 10,807
Depreciation
4
18,411 597 183 549 1,889 – 21,629
Income tax expense
5
18,963 593 851 868 89 41 21,405
Segment profit 57,545 1,366 3,631 2,601 182 102 65,427
Assets
Segment assets
6
767,299 20,941 20,289 34,994 87,439 (103,561) 827,401
Capital expenditure
7
27,681 266 5 – 740 – 28,692
Segment liabilities 401,432 5,181 9,653 19,568 39,784 (58,723) 416,895
1.
Intersegment revenues are eliminated on consolidation. Intercompany profit margins are also eliminated.
2.
External sales revenue includes various payments to customers for volume discounts, rebates and other promotional support. For volume
discounts, rebates and other promotional support not invoiced at 30 June 2020, the Group recognised accruals of $22,390,000 (30 June 2019:
$22,712,000). During the year, $2,577,000 of these accruals have been released (2020: $1,373,000).
3.
Interest expense is net of any interest capitalised to long-term assets and inventory. During the year, $1,325,000 (2020: $1,460,000) was
capitalised to long-term assets. During the year, $5,254,000 (2020: $5,442,000) was capitalised to inventory.
4.
Depreciation expense presented above is gross of $18,774,000 (2020: $18,224,000), which has been included within inventory.
5.
Segment income tax expense does not include the deferred tax impacts of temporary differences arising from intercompany stock margin
eliminations as this is managed on a group level.
6.
Segment assets include the value of investments and loan balances for subsidiaries which reside in Delegat Limited, however do not include
the effects of stock margin eliminations for stock on hand in subsidiaries.
7.
Capital expenditure consists of additions of property, plant and equipment inclusive of capitalised interest. Capital expenditure is included
within each of the reported segment assets noted above.
8.
During the 2021 financial year, Delegat USA, Inc. had a single customer which comprised 10% or more of group sales amounting to $70,118,000.
9.
During the 2020 financial year, Delegat USA, Inc. had a single customer which comprised 10% or more of group sales amounting to $65,556,000.
10.
Other segments’ assets include non-current assets of Barossa Valley Estate Pty Limited of $47,723,000 (2020: $48,539,000) which are located
in Australia.
11.
The eliminations and adjustments of segment profit, assets and liabilities relate to intercompany transactions and balances which are
eliminated on consolidation.
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202148
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
4 . E X P E N S E S
Expenses by function have been categorised as follows:
Notes 2021 2020
$000 $000
Restated*
Cost of sales 159,118 150,436
Selling, marketing and promotion expenses 36,016 39,884
Corporate governance expenses 991 941
Administration expenses 13,940 15,281
210,065 206,542
Specific components of the above expenses include:
Directors’ fees – Delegat Group Limited 332 320
Directors’ fees – Overseas subsidiaries 52 50
Unrealised foreign exchange loss - 853
Depreciation
1
14, 16 22,998 21,629
Wages and salaries
2
44,279 44,487
Defined contribution pension plans
2
1,622 1,603
Termination benefits paid
2
550 274
Auditor Remuneration
3,4
Assurance services
Audit of the financial statements 286 214
Non-assurance services
Tax compliance 42 41
Total remuneration 328 255
1.
The depreciation figure presented above represents the gross depreciation charge for the year. Depreciation is recorded in the business
function to which the asset relates. Depreciation incurred on assets directly associated with winemaking and viticulture of $18,774,000 (2020:
$18,224,000) is included within the cost of inventories and expensed as a cost of sales when product is sold.
Depreciation on vineyard development commences when the vineyard is considered to be in commercial production, which is generally when
the vineyard has produced approximately 60% of the expected yield at full production.
2.
The employee benefit figures above represent the gross employee benefits expense for the year. Included within inventory is remuneration
paid to employees directly associated with winemaking, bottling and packaging. During the year, $9,837,000 (2020: $9,414,000) of employee
benefits were included within inventory. These costs are included within inventory until the stock to which the expenditure relates is sold.
3.
The auditor of Delegat Group Limited is Deloitte (2020: Ernst & Young). Amounts received, or due and receivable, by Deloitte (2020: Ernst &
Young) are as disclosed above.
4.
During the year, the Group also paid $5,000 (2020: $4,000) to SBA Stone Forest CPA Co. Limited for the audit of the local financial statements
of Delegat (Shanghai) Trading Co. Limited.
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202149
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
5. EARNINGS PER SHARE
Basic earnings per share is calculated as Group profit after income tax attributable to ordinary
shareholders of the Parent, adjusted to exclude any costs of servicing equity (other than dividends) and
preference share dividends, divided by the weighted average number of ordinary shares on issue.
Diluted earnings per share is calculated as Group profit after income tax attributable to ordinary
shareholders of the Parent adjusted for:
– costs of servicing equity (other than dividends) and preference share dividends;
– the after tax effect of dividends and interest associated with dilutive potential ordinary shares that
have been recognised as expenses; and
– other non-discretionary changes in revenues and expenses during the period that would result from
the dilution of potential ordinary shares
divided by the weighted average number of ordinary shares and dilutive potential ordinary shares.
The following reflects the earnings used in the calculation of the basic and fully diluted earnings per share:
2021 2020
Restated*
a) Earnings Used in Calculating Earnings per Share
Profit for the year – basic and fully diluted ($000) 62,169 65,427
b) Weighted Average Number of Shares
Weighted average number of shares – basic and fully diluted (000s) 101,130 101,130
c) Reported Earnings per Share on Statement of Financial Performance
(expressed as cents per share)
Basic and fully diluted earnings per share 61.47 64.70
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202150
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
6. SHARE CAPITAL
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares
or options are shown in equity as a deduction from the proceeds.
2021 2020
$000 $000
Balance at beginning of the year 49,815 49,815
Balance at end of the year 49,815 49,815
a) Movement in the Number of Ordinary Shares on Issue Shares Held
000s 000s
Balance at beginning of the year 101,130 101,130
Balance at end of the year 101,130 101,130
All ordinary shares have equal voting rights and share equally in dividends and surplus on winding up.
b) Nature and Purpose of Reserves
Foreign Currency Translation Reserve
The foreign currency translation reserve is used to record exchange differences arising from the translation of the
financial statements of foreign subsidiaries. During the year, equity decreased by $958,000 upon the translation of
foreign subsidiaries (2020: $1,497,000 increase).
7. DIVIDENDS PAID AND PROPOSED
a) Recognised Amounts
Dividends that were declared and paid on ordinary shares during the year amounted to $17,217,000 (2020: $17,215,000)
equating to 17.0 cents per share (2020: 17.0 cents per share).
b) Unrecognised Amounts
After the balance sheet date, dividends of 20.0 cents per share were approved by the Board of Directors. These
amounts are not recognised in these financial statements as the declaration date was subsequent to year-end.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202151
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
8. TRADE PAYABLES AND ACCRUALS
Trade payables are initially recognised at fair value and then carried at amortised cost, and due to their
short-term nature, they are not discounted. They represent liabilities for goods and services provided
to the Group prior to the end of the financial year that are unpaid and arise when the Group becomes
obliged to make future payments in respect of the purchase of these goods and services.
Provisions and accruals are recognised when the Group has a present obligation as a result of a past
event and it is probable that an outflow of economic resources embodying economic benefits will be
required to settle the obligation and a reliable estimate can be made of the amount of the obligation.
Provisions and accruals are measured as the present value of management’s best estimate of the
expenditure required to settle the present value of the obligation at the balance sheet date. If the effect
of the time value of money is material, provisions and accruals are discounted using a pre-tax rate that
reflects the time value of money and the risks specific to the liability. The increase in the provision or
accruals resulting from the passage of time is recognised as a finance cost.
Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulated sick
leave expected to be settled within 12 months of the reporting date, are recognised in respect of the
employee’s services up to the reporting date. They are measured as the amounts expected to be paid
when the liabilities are settled. Liabilities for non-accumulating sick leave are recognised when the leave
is taken and is measured at the rates paid or payable.
The Group makes regular contributions to various defined contribution pension plans. Included within
the statement of financial performance are amounts paid and payable by the Group into these pension
plans, net of any related tax rebates. The Group does not make available or make contributions to any
defined benefit superannuation plans.
2021 2020
$000 $000
Trade payables 15,281 13,416
Employee entitlements and leave benefits 5,834 6,017
Goods and services tax 1,712 593
Accrued expenses 6,071 7, 8 5 3
28,898 27,879
Trade payables are unsecured, non-interest bearing and are generally settled on 30 to 60 day terms. The carrying
amount disclosed above is a reasonable approximation of fair value.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202152
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
9. DERIVATIVE FINANCIAL INSTRUMENTS
The Group uses derivative financial instruments such as forward currency contracts and options to
economically hedge its risks associated with foreign currency fluctuations and interest rate swaps to
manage interest rate risk. Such derivative financial instruments are initially recognised at fair value on
the date on which a derivative contract is entered into, and are subsequently remeasured to fair value at
balance date. Any gains or losses arising from changes in the fair value of derivatives are taken directly
to the statement of financial performance. The fair value of forward exchange contracts and options is
determined by reference to current forward exchange rates for contracts with similar maturity profiles.
The fair value of interest rate swaps is determined by reference to market inputs for similar instruments.
The Group has the following derivative financial instruments outstanding at the balance sheet date:
a) Foreign Currency Forward Exchange Contracts and Options
i) Forward Exchange Contracts
AVERAGE CONTRACTED RATE NOTIONAL VALUE
2021 2020 2021 2020
Selling Currency/Buying NZD $000 $000
Sell AUD, maturity 0 – 5 months 0.9230 0.9279 8,570 8,245
Sell USD, maturity 0 – 12 months 0.6902 0.5962 17, 0 6 9 10,333
Sell GBP, maturity 0 – 9 months 0.5039 0.4912 17,107 12,218
Sell CAD, maturity 1 – 12 months 0.8800 0.8359 5,114 1,975
Sell SGD, maturity 0 – 8 months 0.9463 0.8481 4 47 539
Sell JPY, maturity 1 month 76.9700 64.0400 65 78
Sell HKD, maturity 0-6 months 5.4883 – 1,275 –
Sell EUR, maturity 0-3 months 0.5886 – 1,699 –
Buying Currency/Selling NZD
Buy EUR, maturity 0 months 0.5854 0.5729 700 454
Buy GBP – 0.5130 – 439
The fair value of forward exchange contracts is determined by comparing the market rates for contracts with the
same nominal amount, exercise price and length of time to maturity.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202153
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
a) Foreign Currency Forward Exchange Contracts and Options (continued)
ii) Forward Currency Options
AVERAGE CONTRACTED RATE NOTIONAL VALUE
2021 2020 2021 2020
Selling Currency/Buying NZD $000 $000
Sell USD, maturity 1 – 21 months 0.6877 0.6284 28,750 25,737
Sell GBP, maturity 1 – 12 months 0.5128 0.4914 28,285 24,095
Sell AUD, maturity 3 – 11 months 0.9289 0.9314 9,150 13,421
Sell CAD, maturity 3 – 12 months 0.8846 0.8491 9,611 7, 3 6 2
NZ IFRS 9: Financial Instruments requires that derivative financial instruments are classified as fair value
through profit or loss for measurement purposes unless they are accounted for as hedges. Under NZ
IAS 1: Presentation of Financial Statements, assets and liabilities under the fair value through profit or
loss classification would generally be classified as current in the statement of financial position if held for
trading. However, if the intent is not to actually trade the derivative financial instruments with maturities
greater than one year but to hold them until maturity, then the derivative financial instruments are
more appropriately classified as non-current. The amounts that are classified as non-current reflect the
amounts that will not be settled in the next 12 months.
The classification of forward exchange contracts and forward currency options between current and non-current
is based on whether the contracts will be settled in the next 12 months. The fair value of open contracts existing at
balance sheet date are classified as follows:
2021 2020
Assets Liabilities Assets Liabilities
$000 $000 $000 $000
Current
Forward Exchange Contracts 271 – 1,635 –
Foreign Currency Options – 314 1,983 –
271 314 3,618 –
Non-current
Forward Exchange Contracts – – – –
Foreign Currency Options – 68 69 –
– 68 69 –
9. DERIVATIVE FINANCIAL INSTRUMENTS (C O N T I N U E D)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202154
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
b) Interest Rate Swaps
In order to protect against risks relating to increases in interest rates, the Group has entered into interest rate swap
contracts under which the Group receives interest at variable rates and has agreed to pay interest at fixed rates for
varying terms of principal and time durations.
At balance sheet date interest rate contracts are in place that cover a total of $100,000,000 (2020: $97,500,000)
of current New Zealand Dollar denominated Group debt through 11 separate cap rate agreements, which range
in maturity from one to four years, with a weighted average interest rate cap of 3.61% plus bank margin (2020:
3.75% plus bank margin). In addition, interest rate contracts are in place that cover a total of A$37,500,000 (2020:
A$37,500,000) of current Australian Dollar denominated Group debt through eight separate cap rate agreements,
which range in maturity from one to four years, with a weighted average interest rate cap of 2.66% plus bank margin
(2020: 2.66% plus bank margin).
At balance sheet date the Group has one further separate cap rate agreement that covers NZ$25,000,000 (2020:
NZ$45,000,000) which applies at a future date to cover future Group indebtedness. Maturity is five years, with
an interest rate cap of 0.95% plus bank margin (2020: 0.95% and 3.1% plus bank margin). A further two cap rate
agreements are in place that cover a total of A$10,000,000 (2020: A$10,000,000) which apply from various future
dates, ranging in maturity from four to five years, with an interest rate cap of 0.8% plus bank margin (2020: 0.8% plus
bank margin). The application date of these New Zealand Dollar and Australian Dollar denominated future cap rate
agreements range between December 2021 and March 2023.
The total fair value of these contracts at balance sheet date is a liability of $4,086,000 (2020: $10,549,000 liability).
The Group has elected not to apply hedge accounting to its derivative financial instruments and
accordingly the instruments have been classified as fair value through profit and loss.
The classification between current and non-current is based on whether the contracts or portion of contracts will be
settled within the next 12 months. The total fair value of these contracts at balance sheet date is classified as follows:
2021 2020
Assets Liabilities Assets Liabilities
$000 $000 $000 $000
Current
Interest Rate Swaps – 2,565 – 4,649
– 2,565 – 4,649
Non-current
Interest Rate Swaps – 1,522 – 5,900
– 1,522 – 5,900
9. DERIVATIVE FINANCIAL INSTRUMENTS (C O N T I N U E D)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202155
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
10. INTEREST-BEARING LOANS AND BORROWINGS
a) Debt Facilities Existing at Balance Sheet Date
Interest-bearing loans and borrowings are initially recognised at the fair value of the consideration
received, less directly attributable transaction costs. After initial recognition, interest-bearing loans and
borrowings are subsequently measured at amortised cost using the effective interest method. Fees
paid on the establishment of loan facilities are included as part of the carrying amount of the interest-
bearing loans and borrowings. Interest-bearing loans and borrowings are classified as current liabilities,
unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after
balance sheet date.
Borrowing costs are expensed as incurred, except when they are directly attributable to the acquisition
or construction of a qualifying asset. When this is the case, they are capitalised as part of that asset.
Once the asset is put into productive use, capitalisation of the borrowing costs ceases.
At the balance sheet date the following debt facilities have been drawn upon by the Group:
MaturityEffective Interest Rate2021
$000
2020
$000
20212020
Non-Current Debt Obligations
Term facility (Multi-Currency) 30 July 20223.52%3.29% 199,552 219,750
Term facility (AUD)30 July 20221.12%1.18% 34,845 34,684
Working capital facility30 July 20221.53%N/A 23,625 (97)
Headroom facility30 July 2022N/AN/A (21) (41)
258,001 254,296
The carrying amount of the Group’s non-current interest-bearing loans and borrowings are the fair values at balance
sheet date.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202156
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
b) Terms and Conditions of Debt Facilities
i) Senior Debt Facilities
The Group has a syndicated Senior Debt facilities agreement with Westpac New Zealand Limited, Westpac Banking
Corporation, Bank of New Zealand Limited (BNZ), China Construction Bank (New Zealand) Limited (CCB) and
Hongkong and Shanghai Banking Corporation Limited (HSBC). With the syndicated facility a General Security
Agreement has been put in place in favour of the banks over the existing and future assets of Delegat Group Limited,
Delegat Limited, Delegat Australia Pty Limited and Barossa Valley Estate Pty Limited.
At balance sheet date the Working Capital facility, Term facility (Multi-Currency), Term facility (AUD), and Headroom
facility collectively make up the syndicated Senior Debt Facilities of Delegat, which provide funding for the assets
of the Group. The maximum limit of the Working Capital facility is NZ$48,000,000 (2020: NZ$48,000,000), Term
facility (Multi-Currency) is NZ$220,000,000 (2020: NZ$220,000,000), Term facility (AUD) is A$40,000,000 (2020:
A$40,000,000), and the Headroom facility is NZ$20,000,000 (2020: NZ$20,000,000). At balance sheet date
NZ$72,592,000 (2020: NZ$75,828,000) is available for further drawdown on these facilities.
The Term facility (AUD) and a portion of the Term facility (Multi-Currency) are denominated in Australian Dollars (A$).
The amount drawn down in foreign currency at the balance sheet date was A$61,850,000 (2020: A$61,850,000).
Interest on these facilities is based on the BKBM/BBSY plus margin. The facility agreement requires that certain
banking covenants be met and requires the Group to maintain or a better specified EBITDA and fixed charges
coverage ratios, and maintain or better a minimum adjusted equity balance. The Group must also maintain or better
a specified total tangible asset backing. At year-end, and at measurement dates during the year, the covenants of the
Senior Debt Facilities have been met.
ii) Other Facilities
Delegat also has available an overdraft limit of $1,000,000 (2020: $1,000,000). Interest charged on this facility is at
the commercial lending rate (2020: commercial lending rate). At 30 June 2021 the commercial lending rate is 4.75%
(2020: commercial lending rate 4.75%). No amount is drawn against this facility at balance sheet date.
10. INTEREST-BEARING LOANS AND BORROWINGS (C O NTI N U E D)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202157
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
11. TRADE AND OTHER RECEIVABLES
On initial recognition, the Group’s trade receivables are recognised at their transaction price as defined
in NZ IFRS 15: Revenue from Contracts with Customers. The Group’s trade receivable balances are
generally short term and do not contain a significant financing component. They are subsequently
measured at amortised cost using the effective interest method, less an allowance for expected future
credit losses.
The Group applies the simplified approach to measuring expected credit losses which uses a lifetime
expected loss allowance for all trade receivables and sundry receivables if financial assets. Expected
credit losses are measured by grouping trade receivables based on shared credit risk characteristics
and the days past due. A provision matrix is then determined based on the historical credit loss rates for
each group of customers, adjusted for any material expected changes to the future risk for that customer
group.
Individual trade receivable balances which are known to be uncollectible are written off where the Group
has no reasonable expectation of recovering the trade receivable balance.
2021 2020
$000 $000
Trade receivables 3 7, 6 6 3 36,721
Prepayments and sundry receivables 4,496 3,74 6
Goods and services tax 1,838 1,321
43,997 41,788
As at 30 June 2021 the ageing of trade receivables is as follows:
Ageing of receivables
New Zealand
(including
Asia Pacific)
AustraliaUnited
Kingdom
United
States of
America
CanadaGroup
As at 30 June 2021 $000 $000 $000 $000 $000 $000
Current 2,747 9,696 13,677 6,573 4,158 36,851
1 to 30 days 10 - 95 293 398 796
31 to 60 days - - - 16 - 16
Total trade receivables 2,757 9,696 13,772 6,882 4,556 3 7, 6 6 3
All amounts recognised as trade receivables are unsecured and the maximum credit risk is equivalent to the carrying
values noted directly above. Trade receivables are non-interest bearing and generally settled on 30 to 90 day terms.
Due to their short-term nature trade receivables are not discounted.
In determining the historical loss rates to be applied to these customer groups and ageing buckets, the Group has
reviewed whether there were any bad debts written off over the past five years and has identified that these were $nil
(2020: $nil). Accordingly the historical loss rates applied to each customer group at 30 June 2021 are 0% (2020: 0%).
Due to the short term nature of the Group’s trade receivables, the nature of the Group’s customer base, the Group’s
experience over the past five years and other forward looking information, the historical loss rates have not been
adjusted for any material expected future changes in credit risk.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202158
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
12. INVENTORIES
Inventories are valued at the lower of cost and net realisable value. Net realisable value is the estimated
selling price in the ordinary course of business, less estimated costs of completion and the estimated
costs necessary to make the sale. Costs of finished goods sold are assigned on a weighted average cost
basis.
GRAPES
Included within the cost of inventory is the fair value of the grapes (agricultural produce) at the time the
grapes are harvested. At the point of harvest, the harvest of grapes qualify as agricultural produce under
NZ IAS 41: Agriculture and are recorded at fair value at that date. The fair value becomes the basis of cost
when accounting for inventories.
Harvesting of the grape crop is ordinarily performed in late March or early April. Costs incurred in growing
the grapes, including any applicable harvest costs, are initially allocated into the cost of inventory as
part of the total costs to acquire and grow the agricultural produce. At the point of harvest, a fair value
adjustment is made so that the cost per tonne is adjusted to fair value in accordance with NZ IAS 41:
Agriculture and NZ IFRS 13: Fair Value Measurement. Any difference between cost and fair value is
included within the statement of financial performance as cost of sales.
The fair value of grapes at the point of harvest is determined by reference to the market prices for each
variety of grape grown in the local area and the market price paid to independent grape growers. Any
difference between cost and fair value is included within the statement of financial performance as cost
of sales.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202159
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2021 2020
$000 $000
Restated*
Current vintage 85,790 88,395
Aged wine 6 7, 3 3 1 58,329
Winery ingredients, packaging materials and other 6,861 6,116
159,982 152,840
During the year, the Group harvested a total of 37,470 tonnes of grapes (2020: 38,129 tonnes) in New Zealand and
Australia. Of this amount a total of 9,113 tonnes (2020: 11,054 tonnes) were purchased from independent third party
growers. The fair value of agricultural produce from the Group’s owned and leased vineyards at the point of harvest
was $50,785,000 (2020: $53,161,000). A fair value gain of $9,178,000 (2020 Restated*: $18,140,000) was recorded
during the year and included within cost of sales. Included within cost of sales is a total of $168,296,000 (2020:
$168,575,000) which represents costs expended in grape growing (inclusive of lease costs), procurement, delivery
and materials.
13. BIOLOGICAL WORK IN PROGRESS
2021 2020
$000 $000
Restated*
Growing costs relating to next harvest 12,080 12,693
12,080 12,693
As allowed under NZ IAS 41: Agriculture the vineyard costs in the period to 30 June have been recognised
as work in progress for the next harvest and the Group has determined that cost is equal to fair value at
this point of the growth cycle.
12. INVENTORIES (C O NTI N U E D)
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202160
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
14. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment is stated at historical cost less accumulated depreciation and any
accumulated impairment losses. Such costs include the cost of replacing parts that are eligible for
capitalisation when the cost of replacing the parts is incurred. The cost of purchased property, plant and
equipment is the value of the consideration given to acquire the assets and the value of other directly
attributable costs that have been incurred in bringing the assets to the location and condition necessary
for their intended service.
The cost of self-constructed assets includes the cost of all materials used in the construction, direct
labour on the project, lease costs and financing costs that are directly attributable to the project and an
appropriate proportion of directly attributable variable and fixed overheads. Costs cease to be capitalised
when the asset is ready for productive use. In respect of vineyard improvements, capitalisation of costs
continues until the vineyards are ready for productive use, which is when the vineyard has produced
approximately 60% of expected yield at full production, ordinarily a period of three years after the planting
of vines.
Land and Land Improvement assets are measured at cost and are not subject to depreciation.
IMPAIRMENT
Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. If an impairment trigger exists, the recoverable amount of the asset is
determined, being the higher of an asset’s fair value, less costs to sell, and value in use. An impairment
charge is recognised for the amount by which the asset’s carrying amount exceeds its recoverable
amount. For the purposes of assessing impairment, the recoverable amount is determined at the lowest
level for which there are separately identifiable cash flows (cash-generating units).
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202161
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
DEPRECIATION
Depreciation of property, plant and equipment, other than land and land improvements, which has an
indefinite economic life and hence not depreciated, is charged on a straight-line basis so as to write off
the assets to their expected residual value over their estimated useful lives. The estimated useful lives
are as follows:
B
uildings 10–50 years
Plant and Equipment 3–50 years
Vineyard Improvements 3–50 years
Bearer Plants 50 years
The estimation of the useful lives of assets has been based on historical experience as well as lease terms.
The condition of the assets is assessed at least once per year and considered against the remaining
useful life. Adjustments to useful lives are made when considered necessary.
Depreciation on vineyard improvements commences when the vineyard is considered to be in
commercial production, which is when the vineyard has produced approximately 60% of the expected
yield at full production, ordinarily a period of three years after the planting of vines. The assets’ residual
values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at the end of
each financial year.
Capitalised assets on leased vineyards or office premises are depreciated over the shorter of the
estimated useful life of the asset and the remaining lease term.
IMPAIRMENT
The Group assesses impairment of all assets at each reporting date by evaluating conditions specific
to the Group and to the particular asset that may lead to impairment. If an impairment trigger exists,
the recoverable amount of the asset is determined. Management considers there are no indicators of
impairment in the current year and the recoverable amount of the Group’s assets was not required to be
determined.
a) Reconciliation of Carrying Amounts at Beginning and End of the Year
Year ended 30 June 2021
Freehold Land
and Land
Improvements
Vineyard
Improvements
Bearer PlantsBuildingsPlant and
Equipment
Capital Work in
Progress
Total
$000 $000 $000 $000 $000 $000 $000
Net book value at 1 July 2020 130,260 85,553 43,619 110,252 135,407 32,617 5 3 7,7 0 8
Additions/Transfers 25,538 12,948 6,015 7,243 11,351 (1,766) 61,329
Disposals – – – – (45) – (45)
Foreign currency translation 24 56 10 35 11 2 138
Depreciation charge – (3,397) (1,262) (2,887) (9,441) – (16,987)
Net book value at 30 June 2021 155,822 95,160 48,382 114,643 137,283 30,853 582,143
At cost 155,829 141,740 63,818 137,630 248,269 30,853 778,139
Accumulated depreciation and
impairment (7) (46,580) (15,436) (22,987) (110,986) – (195,996)
Net book value at 30 June 2021 155,822 95,160 48,382 114,643 137,283 30,853 582,143
14. PROPERTY, PLANT AND EQUIPMENT (C O N T I N U E D)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202162
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
a) Reconciliation of Carrying Amounts at Beginning and End of the Year (continued)
Year ended 30 June 2020
Freehold Land
and Land
Improvements
Vineyard
Improvements
Bearer PlantsBuildingsPlant and
Equipment
Capital Work in
Progress
Total
$000 $000 $000 $000 $000 $000 $000
Net book value at 1 July 2019 126,297 77,675 44,205 111,868 133,602 31,536 525,183
Additions/Transfers 3,800 10,805 565 929 11,140 1,072 28,311
Disposals – – – – (34) – (34)
Foreign currency translation 163 361 68 239 185 9 1,025
Depreciation charge – (3,288) (1,219) (2,784) (9,486) – (16,777)
Net book value at 30 June 2020 130,260 85,553 43,619 110,252 135,407 32,617 537,708
At cost 130,267 128,729 57,791 130,348 237,729 32,617 717,481
Accumulated depreciation and
impairment (7) (43,176) (14,172) (20,096) (102,322) – (179,773)
Net book value at 30 June 2020 130,260 85,553 43,619 110,252 135,407 32,617 537,708
b) Other Items
During the year, no assets were transferred and classified as assets available for sale. The weighted average interest
rate on interest capitalised during the year was 4.36% (2020: 4.68%).
Bearer plants consist of grapevines on company owned vineyards located in New Zealand and the Barossa Valley,
Australia. At 30 June 2021 the Group has grapevines planted on 1,797 productive hectares of land (2020: 1,528
productive hectares) in New Zealand and 183 productive hectares (2020: 183 productive hectares) in Australia.
The net book value of vines on leased land where the Group does not have the beneficial ownership in the bearer
plants is not reported above, as the risks and rewards incidental to owning the vines do not transfer to the Group.
The Group is, however, party to leases of land on which bearer plants is owned by the Group (refer note 16). The net
book value of these assets is reported, as the risk and rewards incidental to ownership are retained by the Group.
14. PROPERTY, PLANT AND EQUIPMENT (C O N T I N U E D)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202163
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
15. INTANGIBLE ASSETS
Intangible assets acquired separately are measured on initial recognition at cost. The cost of the
intangible assets acquired in a business combination is their fair value at the date of acquisition.
Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and
accumulated impairment losses.
The useful lives of intangible assets are assessed as either finite or indefinite. Intangible assets with finite
lives are amortised over their useful life and assessed for impairment whenever there is an indication that
the intangible asset may be impaired. Intangible assets with indefinite useful lives are not amortised,
but are tested for impairment annually, either individually or at the cash-generating unit (CGU) level. The
assessment of indefinite life is reviewed annually to determine whether the indefinite life continues to be
supportable; if not, the change in useful life from indefinite to finite is made on a prospective basis.
Intangible assets currently owned by the Group have been assessed as having indefinite useful lives
and are therefore tested annually for impairment at the CGU level. The recoverable amount of the
CGU’s assets are higher than the assets’ carrying value and therefore no impairment is required to be
recognised.
Intangible assets currently owned by the Group consist of water rights in both New Zealand and Australia.
Barossa Valley Estate Pty Limited (BVE) owns water rights consisting of shares in Barossa Infrastructure Limited
and associated infrastructure levies. These water rights grant BVE the right to a fixed number of units of water per
share and were purchased by BVE to support their vineyard activities. BVE continues to have the right to use the
water over an indefinite period and therefore the water rights are considered to have an indefinite useful life.
Delegat Limited (Delegat) owns water rights consisting of shares in Lower Waihopai Dam Limited. These water
rights grant Delegat the right to a fixed number of units of water per share and were purchased by Delegat to support
their vineyard activities. Delegat continues to have the right to use the water over an indefinite period and therefore
the water rights are considered to have an indefinite useful life.
The movement in the value of intangible assets is summarised as follows:
2021 2020
$000 $000
Carrying value at beginning of the year 5,436 4,950
Purchases of intangible assets 395 421
Disposal of intangible assets – (40)
Foreign currency translation 18 105
Carrying value at end of the year 5,849 5,436
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202164
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
16. LEASES
At the inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is,
or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of
time in exchange for consideration.
The Group applies a single recognition and measurement approach for all leases, except for leases of
low-value assets. The Group applies the low-value assets recognition exemption for its barrel leases.
Payments on the Group’s barrel leases are expensed on a straight line basis over the lease terms. The
Group recognises lease liabilities to make lease payments and right-of-use assets representing the right to
use the underlying assets.
RIGHT-OF-USE ASSETS
The Group recognises right-of-use assets at the commencement date of the lease. Right-of-use assets
are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any
remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities
recognised, initial direct costs incurred, and lease payments made at or before the commencement date,
less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over the
shorter of the lease term and the estimated useful lives of the assets. The estimated useful lives of right-of-
use assets are determined on the same basis as those of property, plant and equipment.
LEASE LIABILITY
At the commencement date of the lease, the Group recognises lease liabilities measured at the present
value of lease payments to be made over the lease term. In calculating the present value of lease payments,
the Group uses the interest rate implicit in the lease when readily determinable; if the implicit interest rate is
not readily determinable the Group uses its incremental borrowing rate at the lease commencement date.
After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest
and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured
if there is a modification, a change in the lease term or a change in the lease payments.
Right-of-use asset depreciation and lease liability interest that are directly attributable to bringing new
vineyards to working condition for their intended use are capitalised up until the time the vineyards become
commercially productive. The accumulated amount is then amortised over the remaining lease term.
The Group determines the lease term as the non-cancellable term of the lease, together with any periods
covered by an option to extend the lease if it is reasonably certain to be exercised. When the Group has the
option to extend a lease, management uses its judgement to determine whether or not an option would be
reasonably certain to be exercised. Management considers all facts and circumstances, including its past
practice and any cost that will be incurred to change the asset if an option to extend is not taken, to help
determine the lease term. After the commencement date, the Group reassesses the lease term if there is a
significant event or change in circumstances that is within its control and affects its ability to exercise or not
to exercise the option to renew.
To determine the value of the lease liability, the future lease payments are discounted using the interest
rate implicit in the lease, otherwise the Group’s incremental borrowing rate is used. Implicit interest rates
are present in most of the Group’s vineyard leases. The Group’s incremental borrowing rate is the rate that
the Group would have to pay to borrow the funds necessary to obtain an asset of similar value in a similar
economic environment with similar terms and conditions. The Group is required to revise the discount rate
used if there is a change in the lease term, a change in the assessment of an option to purchase the underlying
asset, a change in future lease payments resulting from a change in an index or a rate used to determine those
payments, or where there is a lease modification that is not accounted for as a separate lease.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202165
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
RIGHT-OF-USE ASSETS
Leases held by the Group include long-term land leases, vineyard improvements and bearer plants, which allow the
Group to access prime viticultural land in the Marlborough and Hawke’s Bay areas. The leases provide the Group
the right of first refusal in the event that the land is put up for sale. Other leases include office building, car and
equipment leases.
a) Reconciliation of Right-of-Use Assets at the Beginning and End of the Year
Year ended 30 June 2021
Freehold Land
and Land
Improvements
Vineyard
Improvements
Bearer PlantsBuildingsPlant and
Equipment
Total
$000 $000 $000 $000 $000 $000
Net book value at 1 July 2020 32,088 11,770 3,872 6,106 4,658 58,494
Additions/Transfers 324 300 95 18,042 378 19,139
Disposals (95) - - (45) (9) (149)
Foreign currency translation - - - (140) 2 (138)
Depreciation charge (1,558) (693) (224) (2,728) (808) (6,011)
Net book value at 30 June 2021 30,759 11,377 3,743 21,235 4,221 71,335
At cost 55,486 23,962 7,518 33,157 7,191 12 7, 3 14
Accumulated depreciation (24,727) (12,585) (3,775) (11,922) (2,970) (55,979)
Net book value at 30 June 2021 30,759 11,377 3,743 21,235 4,221 71,335
Year ended 30 June 2020
Freehold Land
and Land
Improvements
Vineyard
Improvements
Bearer PlantsBuildingsPlant and
Equipment
Total
$000 $000 $000 $000 $000 $000
Net book value at 1 July 2019 33,278 12,094 3,980 6,744 5,011 61,107
Additions/Transfers 360 348 110 940 476 2,234
Disposals – – – (91) (41) (132)
Foreign currency translation – – – 126 11 137
Depreciation charge (1,550) (672) (218) (1,613) (799) (4,852)
Net book value at 30 June 2020 32,088 11,770 3,872 6,106 4,658 58,494
At cost 55,256 23,662 7,423 18,018 7,028 111,387
Accumulated depreciation (23,168) (11,892) (3,551) (11,912) (2,370) (52,893)
Net book value at 30 June 2020 32,088 11,770 3,872 6,106 4,658 58,494
16. LEASES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202166
LEASE LIABILITY
b) Reconciliation of Lease Liability at the Beginning and End of the Year
2021 2020
$000 $000
Balance at beginning of the year 84,062 86,429
Per Statement of Cash Flows:
– Interest Expense 5,770 5,649
– Principal Repayments (9,949) (10,222)
Additions/Transfers 19,139 2,241
Disposals (155) (192)
Foreign currency translation (164) 157
Balance at end of the year 98,703 84,062
Current 4,840 4,538
Non-current 93,863 79,524
98,703 84,062
The maturity analysis of lease liabilities is disclosed in Note 2.
c) Other Items
The Group had total cash outflows for leases of $15,849,000 (2020: $16,102,000); this includes an amount of
$5,900,000 (2020: $5,880,000) in relation to leases of low-value assets. Low value asset lease expenses are
expensed on a straight line basis over the lease terms.
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
16. LEASES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202167
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
17. INCOME TAX EXPENSE
Current tax assets and liabilities for the current and prior periods are measured as the amount expected
to be recovered from, or paid to, the taxation authorities based on the current period’s taxable income.
The tax rates and tax laws used to compute the amount are those that are enacted or substantively
enacted at the balance sheet date.
Deferred income tax is provided for all temporary differences at the balance sheet date between the
tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred
income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax
credits and unused tax losses, to the extent that it is probable that taxable profit will be available against
which the deductible temporary differences and the carry-forward of unused tax credits and unused tax
losses can be utilised. The carrying amount of deferred income tax assets is reviewed at each balance
sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be
available to allow all, or part of, the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to
the year when the asset is realised or the liability is settled, based on the tax rates and tax laws that have
been enacted or substantively enacted at the balance sheet date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in the
statement of financial performance.
Deferred tax assets and liabilities are offset only if a legally enforceable right exists to set off current tax
assets against current tax liabilities, and the deferred tax assets and liabilities relate to the same taxable
entity and the same taxation authority.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202168
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2021 2020
$000 $000
Restated*
a) Numerical reconciliation between aggregate tax expense
in the statement of financial performance and tax expense
calculated per the statutory income tax rate
Accounting profit before tax 85,534 86,832
At the Group’s statutory income tax rate of 28% (2020: 28%) 23,950 24,313
Tax impact of the following items:
Adjustments in respect of income tax of prior years (63) (93)
Entertainment 56 179
Legal fees 26 40
Non-assessable income (48) (47)
Reinstatement of tax depreciation for buildings – (2,860)
Non-deductible depreciation on buildings acquired post May 2010 – 388
Tax on foreign income due to different tax rates (556) (515)
Income tax expense for the year 23,365 21,405
b) The major components of income tax expense are:
Income tax reported in the statement of financial performance
Estimated current period tax assessment 22,569 21,259
Adjustments in respect of income tax of prior years (63) (116)
Movements in the deferred income tax liability 859 262
Income tax expense for the year 23,365 21,405
Income tax reported in the statement of other comprehensive income
Net loss on hedge of net investment (30) (202)
Income tax credited to other comprehensive income (30) (202)
17. INCOME TAX EXPENSE (CONTINUED)
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202169
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2021 2020
$000 $000
Restated*
c) Deferred income tax at balance sheet date relates to the following:
Capitalised interest 5,352 5,131
Capitalised leases 427 504
Accelerated depreciation of long-term assets 19,898 17,74 4
Leases (7,651) ( 7,12 3)
Fair value adjustments on biological produce 7, 9 9 6 9,788
Excess of fair value on acquisition of bearer plants over tax values 8,682 8,682
Provisions (750) (906)
Stock profit eliminations (907) (1,312)
Tax losses carried forward - (152)
Derivative financial instruments (1,175) (1,921)
Net deferred tax liability 31,872 30,435
Balance at beginning of the year 30,435 30,157
On surplus for year 859 262
Adjustments in respect of income tax of prior years 557 –
Foreign currency translation 21 16
Balance at end of the year 31,872 30,435
There are no elements of deferred taxes which are reported within equity.
18. IMPUTATION CREDIT ACCOUNT
2021 2020
$000 $000
Balance at beginning of the year 84,386 72,297
Tax payments 19,902 18,431
Fully imputed dividend paid (6,342) (6,342)
Balance at end of the year 9 7, 9 4 6 84,386
19. COMMITMENTS
The estimated capital expenditure contracted for at 30 June 2021 but not provided for is $18,261,000 (2020:
$24,771,000).
17. INCOME TAX EXPENSE (CONTINUED)
*The financial statements for the year ended 30 June 2020 have been restated for growing costs under NZ IAS 41: Agriculture. Refer to Note 1 of the financial statements.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202170
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
20. RELATED PARTIES
a) Investment in Subsidiaries
Investments in controlled entities are as follows:
Name of EntityPrincipal ActivityCountry of
Incorporation
Ownership Interest %
20212020
Delegat LimitedWinemaking, Sales and
Distribution
New Zealand 100.00 100.00
Delegat Canada LimitedBrand MarketingCanada 100.00 100.00
Delegat Australia Pty LimitedSales and DistributionAustralia 100.00 100.00
Delegat USA, Inc.Sales and DistributionUnited States of
America
100.00 100.00
Delegat Europe LimitedSales and DistributionUnited Kingdom 100.00 100.00
Delegat (Singapore) Pte. LimitedInvestment Holding
Company
Singapore 100.00 100.00
Barossa Valley Estate Pty LimitedWinemakingAustralia 100.00 100.00
Delegat (Shanghai) Trading Co.
Limited
Sales and DistributionChina100.00100.00
The parent company of all subsidiaries is Delegat Group Limited, except for Delegat Europe Limited and Barossa
Valley Estate Pty Limited whose immediate parent company is Delegat Limited, and Delegat (Shanghai) Trading Co.
Limited whose immediate parent company is Delegat (Singapore) Pte. Limited.
All subsidiaries have a 30 June balance date, except for Delegat (Shanghai) Trading Co. Limited which has a
31 December balance date as required by law in China.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202171
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
b) Key Management Personnel
Details relating to key management personnel, including remuneration paid, are included within Note 21.
c) Related Parties by Virtue of Share Ownership
The following Directors hold the following number of Shares in the Parent20212020
Delegat Share Protection Trust
(Jakov Delegat, Rosamari Delegat and Lord Trustee Limited – Trustees) 6 6 , 8 5 7,14 2 6 6 , 8 5 7,14 2
Robert Wilton (Retired 25 November 2020) 765,872 800,000
John Freeman (Resigned 31 March 2021) – 11,000
The individuals above are considered related parties as a result of their shareholding or by virtue of being considered
a member of key management. During the year, a total of $31,000 (2020: $75,000) was paid to Robert Wilton in
his capacity as a Non-Executive Director. Rosamari Delegat received $75,000 (2020: $75,000) in her capacity as a
Non-Executive Director during the year. Graeme Lord (Lord Trustee Limited) received $56,000 (2020: $nil) in his
capacity as a Non-Executive Director up to 31 March 2021. Graeme Lord has not received any director fees since
being appointed Acting Managing Director.
During the year, a total of $50,000 (2020: $100,000) was paid to Robert Wilton in his capacity as an independent
consultant, under normal terms and conditions.
During the year, a total of $198,000 (2020: $nil) was paid to Seacliffe Consulting Limited. The payments made to
Seacliffe Consulting Limited were made in Graeme Lord’s capacity as an independent consultant and under normal
terms and conditions.
d) Transactions with Related Parties who have Significant Influence over Subsidiary Companies
During the year, Delegat Australia Pty Limited paid a total of $27,000 (2020: $26,000) to Yaroona Pty Limited. The
payments made to Yaroona Pty Limited were made in Peter Taylor’s capacity as Company Director. Peter Taylor was
considered to be a related party by virtue of his ability to significantly influence the financial and operating policies
of a subsidiary company.
During the year, Barossa Valley Estate Pty Limited paid a total of $75,000 (2020: $41,000) to Range Road Estate
Pty Limited, including directors’ fees of $21,000 (2020: $21,000). The remaining payments made to Range Road
Estate Pty Limited were made in Alan Hoey’s capacity as an independent consultant and under normal terms and
conditions. Alan Hoey was considered to be a related party by virtue of his ability to significantly influence the
financial and operating policies of a subsidiary company.
During the year, Delegat Limited paid a total of $nil (2020: $19,000) to Range Road Estate Pty Limited. The payments
made to Range Road Estate Pty Limited were made in Alan Hoey’s capacity as an independent consultant and under
normal terms and conditions. Alan Hoey was considered to be a related party by virtue of his ability to significantly
influence the financial and operating policies of a subsidiary company.
During the year, Delegat Limited paid a total of $4,000 (2020: $5,000) to Camelot Trust Pte. Limited, a company
in which a Director of Delegat (Singapore) Pte. Limited has an interest. The payments made to Camelot Trust Pte.
Limited are made in Anita Chew Peck Hwa’s capacity as Company Director.
20. RELATED PARTIES (CONTINUED)
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202172
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
21. KEY MANAGEMENT PERSONNEL
Compensation of Key Management Personnel
Included in the definition of related parties are Key Management Personnel having authority and responsibility for
planning, directing and controlling the activities of the entity either directly or indirectly, including any Director.
Management have assessed the composition of the Key Management and their compensation for the year ended 30
June is presented below:
2021 2020
$000 $000
Short-term employee benefits (including Directors’ fees) 8,708 8,261
Post-employment benefits (including defined contribution pension plan) 249 242
8,957 8,503
22. EVENTS SUBSEQUENT TO BALANCE SHEET DATE
On 27 August 2021, the Directors of the Parent declared a fully imputed dividend of $20,226,000 (20.0 cents per
Share) to be paid on 8 October 2021.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202173
INDEPENDENT AUDITOR’S REPORT
Independent Auditor’ s Report
Tothe Shar eholders of DelegatGroup Li mite d
OpinionWe have auditedth e consolidat edfinancial sta tementsof Dele gatGro up Limited
(the ‘Company’) and it s subsidiaries (t he ‘Gro up’), whichcomprise the consolidated
sta tement of financial poson as at 30 June 2021, and the consolidatedsta tement
of financial perf ormance, sta tement of oth er compre hensiv e income, sta tement of
changes in equityand sta tement of cash flows forth e yearthen ended, and notes
to the consolidatedfinancial sta tements , includin g asummar y of significant
accounng polic ie s.
In our opin ion, the accompanyin g consolidatedfinancial sta tements , on pages 26
to 73, pre sent fairly, inall mat erial re spects, the consolidatedfinancial poson of
the Group as at 30 June 2021, and it s consolidatedfinancialperf ormance and cash
flows forth e yearthen ended inaccordance withNewZeal and Equivalents to
InternanalFinancial Repong Standar ds (‘NZ IFRS’) and InternanalFinancial
Repong Standar ds (‘ IFRS’).
Basis foropinionWe conductedour audit inaccordance withInternanalStandar ds on Audng
(‘ISAs’) and InternanalStandar ds on Audng (NewZealand) (‘ISAs (NZ)’). Our
responsib ilis under th ose standar ds are further described intheAuditor’s
Responses for the Audit of th e Consolidate d FinancialState ments seon of
our re port.
We believe thatthe audit evid encewe have obta in ed issufficient and appro priate
to pro vid e a basis forour opin ion.
We are independent of the Company inaccordance withPro fessionaland Eth ical
Standar d 1 In te rnaonal Code of Eth ic s for Assurance Praconers (including
Inte rnaonal Independence Standards) (NewZealand)is sued by the NewZealand
Audng and Assura nce Standar ds Boar d and the InternaonalEth ics Standar ds
Board forAccounta nts ’In te rnaonal Code of Eth ics for Professional Accounta nts
(includingInte rnaonal Independence Sta ndards), and wehave fulfilled our oth er
eth ical responsib ilis inaccordance withthese requirements .
Other th an inour capacityas auditor and the pro vis ionof taxan advice, we have
no relanship withor in terests inthe Company or any of itssubsid iaries. These
serv ices have not impairedour in dependenceas auditor of the Company and
Gro up.
Audit material ityWe consid er mat erialityprimar ilyinterms of the magnitude of missta tement inthe
financial sta tementsof the Group th at inour ju dgement would make itpro bable
thatthe economic decisions of a reas onablyknowle dgeablepers on wouldbe
changed or influenced (t he ‘quantave’ materiality). In addon, weals o assess
wheth er oth er maersthat come to our anon during the audit would inour
judgement changeor influence the decisions of sucha pers on (t he ‘qualitave’
mat eriality). We use materialityboth inplannin g the scope of our audit workand in
evaluang the resultsof our work .
Key audit maersKey audit mas arethose mas that , inour pro fessional j udgement, wereof
most significance inour audit of the consolidatedfinancial sta tementsof the
current period. These mas wereaddre ssed inthe context of our audit of the
consolidated financial sta tementsas a whole , and in formingour opin ionthere on,
and wedo not pro vid e a separa te opin ionon these mas.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202174
INDEPENDENT AUDITOR’S REPORT CONTINUED
Key audit matter How our audit addressed the key audit matter
Revenue Recognition – Rebates & Promotional
Allowances Accruals
Revenue is recognised net of volume discounts, other
rebates and various other payments to customers for
promotional support. Volume discounts and rebates
not invoiced at reporting date are estimated based on
agreements with customers and estimated depletions
during the period.
As disclosed in note 3, the value of the rebates and
promotional allowances accruals at 30 June 2021 was
$18.1m (2020: $22.4m).
The value of rebates and promotional allowances
accruals as at 30 June 2021 is a key audit matter due
to the high levels of judgement involved in the
calculation of the accruals as management must
estimate the level of achievement of future targets by
customers in order to calculate the level of rebates
and promotional allowances that will be incurred.
In order to respond to the significant judgement in
estimating the rebates and promotional expenses
accruals we:
• held discussions with management to understand the
process and models for estimating the rebates and
promotional allowances accruals;
• evaluated the design and tested the operating
effectiveness of relevant controls over the rebates
and promotional allowances accruals and associated
revenue recognition;
• performed a look-back analysis comparing previous
rebates and promotional allowances accruals to the
actual cost incurred; and
• obtained management’s calculation of the 30 June
2021 rebates and promotional allowances accruals,
checked the calculation for mathematical accuracy
and agreed to supporting evidence on a sample basis.
Other information
The 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.
Our opinion on the consolidated financial statements does not cover the other
information and we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and consider whether it is
materially inconsistent with the consolidated financial statements or our
knowledge obtained in the audit or otherwise appears to be materially misstated. If
so, we are required to report that fact. We have nothing to report in this regard.
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.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202175
INDEPENDENT AUDITOR’S REPORT CONTINUED
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 use
This report is made solely to the Company’s shareholders, as a body. Our audit has
been undertaken so that we might state to the Company’s shareholders those
matters we are required to state to them in an auditor’s report and for no other
purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Company’s shareholders as a body, for our
audit work, for this report, or for the opinions we have formed.
Andrew Dick
Partner
for Deloitte Limited
Auckland, New Zealand
27 August 2021
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202176
CORPORATE GOVERNANCE STATEMENT
CORPORATE GOVERNANCE
Delegat Group Limited (“the Group”) is committed to maintaining the highest standards of governance by
adopting and implementing best practice structures and policies. This Corporate Governance Statement sets
out the corporate governance policies, practices, and processes adopted and followed by the Group (including
the guiding principles, authority, responsibilities, membership and operation of the Board of Directors) as at
27 August 2021 and has been approved by the Board.
The best practice principles (and underlying recommendations) which the Group has had in regard to determining
its governance approach are the principles set out in the NZX Corporate Governance Code 2017 (‘NZX Code’).
The Board’s view is that the Group’s corporate governance policies, practices and processes generally follow the
recommendations of the NZX Code. This Corporate Governance Statement includes disclosure of the extent to
which the Group has followed each of the recommendations in the NZX Code (or where applicable, an explanation
as to why a recommendation was not followed and any alternative practice followed in lieu of the recommendation).
The Group is a company incorporated in New Zealand and listed on the NZX Main Board. Further information
about the Group’s corporate governance framework (including the Board and Board Committee charters, and
codes and selected policies referred to in this section) is available on the Group’s website at www.delegat.com,
under the Investor Relations section.
PRINCIPLE 1 – CODE OF ETHICAL BEHAVIOUR
Directors should set high standards of ethical behaviour, model this behaviour and hold management accountable for
these standards being followed throughout the organisation.
CODE OF ETHICS AND RELATED POLICIES
Recommendation 1.1: The board should document minimum standards of ethical behaviour to which the
issuer’s directors and employees are expected to adhere (a code of ethics).
The Group expects its Directors, senior management and employees to maintain the highest standards of
honesty, integrity and ethical conduct in day to day behaviour and decision making. The Board has adopted a
Code of Ethics which incorporates the requirements set out in Recommendation 1.1, forms part of the induction
process for all new employees and is available on the Group’s website. All Directors, senior management and
employees must provide acknowledgement that they have read and understood the content.
Delegat Group operates a phone service which can be used by Delegat Group’s personnel to report suspected
unacceptable, unethical or illegal behaviour in the workplace.
In addition, the Group has a Modern Slavery Policy, which provides for a zero-tolerance approach to all forms of
forced labour, including modern forms of slavery and any form of human trafficking within our supply chain.
FINANCIAL PRODUCTS TRADING POLICY
Recommendation 1.2: An issuer should have a financial product dealing policy which applies to employees
and directors.
The Financial Products Trading Policy sets out the Group’s requirements for all Directors and employees in
relation to trading the Group’s shares and is available on the Group’s website. This policy incorporates all trading
restraints. In general, Directors and employees are allowed to trade in the Group shares during two ‘trading
windows’. Trading windows commence on the day after the half-year and full-year results are announced to the
market and close on the respective half-year and full-year balance date, which typically means an ‘open period’ of
approximately 120 days. Trading outside these windows is generally prohibited. Proposed transactions by Directors
and employees during the trading windows require approval from the Chairman of the Audit and Risk Committee.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202177
CORPORATE GOVERNANCE STATEMENT CONTINUED
FINANCIAL PRODUCTS TRADING POLICY (CONTINUED)
The policy also provides that no Directors or employees can trade shares if they are in possession of price
sensitive information that is not publicly available. In addition, through our share registry, Computershare
Investor Services Limited, we actively monitor trading in Delegat Group Limited shares by senior personnel.
PRINCIPLE 2 – BOARD COMPOSITION AND PERFORMANCE
To ensure an effective board, there should be a balance of independence, skills, knowledge, experience and
perspectives.
BOARD CHARTER
Recommendation 2.1: The board of an issuer should operate under a written charter which sets out the roles
and responsibilities of the board. The board charter should clearly distinguish and disclose the respective
roles and responsibilities of the board and management.
The Board has adopted a formal Board Charter which sets out the respective roles, responsibilities, composition
and structure of the Board and senior management, and this is available on the Group’s website. The Board is
responsible for the direction and control of the Group’s activities and acknowledges the need for the highest
standard of corporate governance. The responsibility includes such areas of stewardship as the identification
and control of the Group’s business risks, the integrity of management systems and reporting to Shareholders.
The primary objective of the Board is to build long-term Shareholder value, with due regard to other stakeholder
interests. It does this by adopting the strategic plans, objectives and policies that have been set for the Group
by the Managing Director, together with senior management. Responsibility for day-to-day management of
the Group has been delegated to the Managing Director and other members of senior management, to deliver
effective execution of the strategic plans and manage the daily affairs of the Group. The Managing Director
reports regularly to the Board on Group performance, as well as the progress being made against the strategic
plans. Management is responsible for implementing the objectives and strategies approved by the Board, within
the ambit of risk set by the Board.
NOMINATION AND APPOINTMENT OF DIRECTORS
Recommendations 2.2 and 2.3: Every issuer should have a procedure and appointment of directors to the
board. An issuer should enter into written agreements with each newly appointed director establishing the
terms of the appointment.
The Board collectively considers the nominations of Directors. In doing this, the Board’s procedure involves
careful consideration of the composition of the Board in relation to the Group’s needs and operating environment
to ensure relevant skills and experience. This also applies to the consideration of additional or replacement
Directors, subject to the constitutional limitation on the number of Directors. In so doing, as noted, the priority
must be on ensuring the skills, experience and diversity on the Board, and the skills that are necessary or
desirable for the Board to fulfil its governance role and to contribute to the long-term strategic direction of the
Group. The Board may engage consultants to assist in the identification, recruitment and appointment of suitable
candidates.
When appointing new Directors, the Board ensures that the constitutional requirements in respect of Directors
will continue to be satisfied. There must be at least three and no more than nine, at least two Directors must
be resident in New Zealand and, while the Company is listed, at least two Directors must be determined by the
Board to be independent. Each director receives a letter formalising his or her appointment. That letter outlines
the key terms and conditions of his or her appointment, including Delegat Group’s expectations of the role of
director, and is required to be countersigned confirming agreement.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202178
CORPORATE GOVERNANCE STATEMENT CONTINUED
NOMINATION AND APPOINTMENT OF DIRECTORS (CONTINUED)
The NZX Listing Rules and the Group’s Constitution requires that all Directors stand for re-election at the Annual
Meeting of Shareholders within three years of last being elected. Directors may be appointed by the Board to
fill vacancies, but they are then subject to re-election at the next Annual Meeting of Shareholders. In addition
to Directors retiring by rotation, and eligible for re-election, nominations may be made by Shareholders. All new
Directors will enter into a written agreement with the Group setting out the terms of their appointment.
DIRECTORS
Recommendation 2.4: Every issuer should disclose information about each director in its annual report or on
its website, including a profile of experience, length of service, independence and ownership interests and
director attendance at board meetings.
The Board currently comprises five Directors; three Non-Executive and two Executive Directors. The Board has
considered which of its Directors are deemed to be independent for the purposes of the NZX Listing Rules and
has determined that as at 27 August 2021, two Directors were independent Directors, including the Chair of the
Audit and Risk Committee and the Chair of the Remuneration Committee. As at 27 August 2021, the Directors
are:
Jakov (Jim) Delegat Executive Appointed in April 2006
Rosemari (Rose) Delegat Non-Executive Appointed in April 2006
Graeme Lord Executive Appointed in July 2020
Dr Alan Jackson Independent Appointed in October 2012
Phillipa Muir Independent Appointed in August 2020
A profile of experience for each Director is available on the Group’s website and included in the Annual Report on
pages 22 through 24.
D I V E R S I T Y
Recommendation 2.5: An issuer should have a written diversity policy which includes requirement for the
board or a relevant committee of the board to set measurable objectives for achieving diversity (which, at
a minimum, should address gender diversity) and to assess annually both the objectives and the entity’s
progress in achieving them. The issuer should disclose the policy or a summary of it.
The Group values diversity and our workforce, including potential employees, come from all walks of life. Every
individual is unique, having different skills and experiences. People come from many cultures and backgrounds,
along with a wide range of other personal attributes including gender, age, culture, disability (mental, learning,
physical), economic background, language(s) spoken, marital/partnered status, race, religious beliefs and sexual
orientation. The Group has a commitment to attracting, selecting, developing and retaining the most suitable
employees from this diverse range of attributes. The Group’s Diversity Policy (including inclusiveness) is available
on the Group’s website.
A breakdown of the gender composition of the Group is:
2021Global
Sales
%Viticulture%Winemaking,
Bottling and
Warehousing
%Management
and Admin
%Tot a l%
Female8057%2021%4233%4873%19044%
Male6043%7479%8567%1827%23756%
1409412766427
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202179
CORPORATE GOVERNANCE STATEMENT CONTINUED
DIVERSITY (CONTINUED)
2020Global
Sales
%Viticulture%Winemaking,
Bottling and
Warehousing
%Management
and Admin
%Tot a l%
Female9259%1921%3529%4673%19245%
Male6441%7379%8571%1727%23955%
1569212063431
A breakdown of the gender composition of Directors and senior management at the Group’s balance date is:
% Female (Number) % Male (Number)
2021 2020 2021 2020
Directors 40% (2) 33% (2) 60% (3) 67% (4)
Senior management 28% (5) 29% (5) 72% (13) 71% (12)
The Board and management recognise that diversity and inclusion planning leads to a balanced workforce. The
Group has in place a formal diversity plan focused on:
• Diversity and inclusion education;
• Unconscious bias understanding;
• The collection and updating of relevant demographic data;
• The review of recruitment and performance assessment processes (for gender bias in particular); and
• Policies and procedures to support equitable treatment of all existing and future employees.
During the year under review, the Group has made progress against this plan, specifically:
• Group wide unconscious bias training started and completed in some teams;
• Diversity and inclusion champions identified and Diversity and Inclusion committees formed in some teams;
and
• Diversity dashboards developed in our Human Resource Information System to support with diversity reporting.
The Board has approved the 2022 work plan and are satisfied with the rate of progress to date on group wide
initiatives.
DIRECTOR TRAINING
Recommendation 2.6: Directors should undertake appropriate training to remain current on how to best
perform their duties as directors of an issuer.
The Board expects all Directors to be members of the Institute of Directors and to undertake continuous
education to remain current on how to best perform their responsibilities and keep abreast of changes and trends
in economic, political, social, financial and legal climates and governance practices. The Board also ensures that
new Directors are appropriately introduced to management and the business, that all Directors are updated
on relevant industry and Group issues and receive copies of appropriate Group documents to enable them to
perform their roles. The Board visits each of the Group’s main operational areas by rotation annually, to observe
first-hand the safety and other management practices and business responses to issues.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202180
CORPORATE GOVERNANCE STATEMENT CONTINUED
BOARD EVALUATION
Recommendation 2.7: The board should have a procedure to regularly assess director, board and committee
performance.
The Chairman of the Board leads a biannual performance review and evaluation of the performance of the
Directors, the Board as a whole, and of the Board committees against the Board and committee charters,
including seeking Directors’ views relating to Board and committee process, efficiency and effectiveness. All
Non-Executive Directors are expected to participate in performance reviews, particularly prior to the re-election
of a Non-Executive Director to the Board. The findings of the performance review process are used to identify,
assess and enhance Directors’ competencies and to define characteristics or skills which should be sought in
future Board candidates.
DIRECTOR INDEPENDENCE
Recommendations 2.8 and 2.9: A majority of the board should be independent directors. An issuer should
have an independent chair of the board. If the chair is not independent, the chair and the CEO should be
different people.
The Board currently comprises five Directors, two of whom are deemed “independent” according to the NZX
Code. The Board recognises this divergence from the Code that for best practice a majority of board members
will be independent. With respect to Director composition and given the various operating environments of the
Group and its needs, the Board considers that the profile offered by each Director, and all Directors collectively,
provides appropriate experience, skill and diversity to meet its governance responsibilities. In looking to future
board appointments the Board is committed to achieving compliance with the Code and will, when appropriate,
propose suitable or additional nominees. The Board is of the view that the divergence has not interfered with the
Directors’ capacity to provide independent judgements in fulfilling their responsibilities.
The Board Charter is explicit in that the Chairman and Managing Director roles are separate.
PRINCIPLE 3 – BOARD COMMITTEES
The board should use committees where this will enhance its effectiveness in key areas, while still retaining board
responsibility.
AUDIT AND RISK COMMITTEE
Recommendation 3.1: An issuer’s audit committee should operate under a written charter. Membership on
the audit committee should be majority independent and comprise solely of non-executive directors of the
issuer. The chair of the audit committee should be an independent director and not the chair of the board.
The Audit and Risk Committee operates under a written Charter, and this is available on the Group’s website. As
at 30 June 2021 the Audit and Risk Committee comprised Dr Alan Jackson (Chair), Graeme Lord and Phillipa Muir,
the Committee meets at least four times during the year, and more frequently if required. The Audit and Risk
Committee is responsible for the framework of internal control mechanisms that ensure proper management of
the Group’s affairs. These controls including the safeguarding of assets, maintaining proper accounting records,
complying with legislation, ensuring the reliability of financial information, and assessing and reviewing business
operational risks. The committee advises and assists the Board in discharging its responsibility with respect to
financial reporting, tax planning, compliance and risk management practices of the Group.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202181
AUDIT AND RISK COMMITTEE (CONTINUED)
Recommendation 3.2: Employees should only attend audit committees at the invitation of the audit
committee.
The Managing Director and Chief Financial Officer attend Audit and Risk Committee meetings at the invitation
of the Audit and Risk Committee. The Audit and Risk Committee may invite any senior management member to
present on their respective function or a particular subject matter that is relevant in the committee considering
the Group’s compliance or risk management practices. The Group’s external auditor also attends meetings at
the committee’s invitation. The Audit and Risk Committee receives feedback from the external auditor (without
management present), concerning any matters that arise in connection with the audit and performance of
management’s roles.
REMUNERATION COMMITTEE
Recommendation 3.3: An issuer should have a remuneration committee which operates under a written
charter (unless this is carried out by the whole board). At least a majority of the remuneration committee
should be independent directors. Management should only attend remuneration committees at the invitation
of the remuneration committee.
The Remuneration Committee operates under a written Charter, and this is available on the Group’s website. As
at 30 June 2021 the Remuneration Committee comprised Phillipa Muir (Chair), Dr Alan Jackson and Graeme Lord.
The Committee meets at least three times during the year, and more frequently if required. The Remuneration
Committee assists the Board in discharging its responsibilities with respect to the remuneration and performance
of the Managing Director and other senior management, remuneration of Directors, human resources policy and
strategy and succession planning. The Committee also monitors and reports on general trends and proposals
concerning employment conditions and remuneration. The Managing Director and Group People and Culture
Manager attend Remuneration Committee meetings at the invitation of the Remuneration Committee.
NOMINATION COMMITTEE
Recommendation 3.4: An issuer should establish a nomination committee to recommend director
appointments to the board (unless this is carried out by the whole board), which should operate under a
written charter. At least a majority of the nomination committee should be independent directors.
The Board does not operate a separate Nomination Committee as Director appointments are considered by the
Board as a whole. The Board’s procedure for the nomination and appointment of Directors is summarised under
Principle 2 above (under the heading “Nomination and Appointment of Directors”).
OVERVIEW OF BOARD COMMITTEES
Recommendation 3.5: An issuer should consider whether it is appropriate to have any other board committees
as standing board committees. All committees should operate under written charters. An issuer should
identify the members of each of its committees, and periodically report member attendance.
The Board does not operate any other committees apart from the Audit and Risk Committee and the Remuneration
Committee. The Group has considered whether any other standing Board committees are appropriate and has
determined the existing committee structure is appropriate for meeting governance obligations. Each committee
operates under a charter which is available on the Group’s website. Committee members are appointed from
members of the Board and membership is reviewed on an annual basis. Any recommendation made by the
committee is typically submitted to the Board for formal approval. The Managing Director and relevant key
executives are invited to attend committee meetings as appropriate.
CORPORATE GOVERNANCE STATEMENT CONTINUED
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202182
ATTENDANCE AT BOARD AND COMMITTEE MEETINGS
For the year ended 30 June 2021
BoardAudit and RiskRemuneration
Number of meetings held664
AttendedAttendedAttended
Jim Delegat6
Rose Delegat5
Graeme Lord664
Phillipa Muir543
Dr Alan Jackson663
John Freeman4
Bob Wilton332
Shelley Cave111
TAKEOVER PROTOCOLS
Recommendation 3.6: The board should establish appropriate protocols that set out the procedures to be
followed if there is a takeover offer for the issuer including any communications between insiders and the
bidder. The board should disclose the scope of independent advisory reports to shareholders. These protocols
should include the option of establishing an independent takeover committee, and the likely composition
and implementation of an independent takeover committee.
Given the Group’s shareholding structure, with the largest Shareholder being the Delegat Share Protection Trust
(a related party), the Board considers the likelihood of an unanticipated takeover to be low, and so the Board, in
the event of a takeover offer, has agreed that a Takeover Response Committee would be convened comprising
Independent Directors. That committee would consider the Group’s actions in relation to the takeover offer,
including seeking appropriate legal, financial and strategic advice, complying with takeover regulation (including
the appointment of an independent advisor under the Takeovers Code and the preparation of a Target Company
Statement) and determining what additional information (if any) would be provided by the Group to the bidder.
PRINCIPLE 4 – REPORTING AND DISCLOSURE
The board should demand integrity in financial and non-financial reporting, and in the timeliness and balance of
corporate disclosures.
The Board is committed to timely, accurate and meaningful reporting of financial and non-financial information.
CONTINUOUS DISCLOSURE
Recommendation 4.1: An issuer’s board should have a written continuous disclosure policy.
As a listed company there is an imperative for the Group to ensure the market is appropriately informed and
Delegat is committed to ensuring that all of our shareholders have timely access to full and accurate material
information about the Group. The Group has a Continuous Disclosure Policy, and this is available on the Group’s
website. The purpose of this policy is to ensure the Group complies with its continuous disclosure obligations
by ensuring timely, accurate and complete information is provided to all Shareholders and market participants.
Directors formally consider at each Board meeting whether there is relevant material information which should
be disclosed to the market.
CORPORATE GOVERNANCE STATEMENT CONTINUED
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202183
CHARTERS AND POLICIES
Recommendation 4.2: An issuer should make its code of ethics, board and committee charters and the policies
recommended in the NZX Code, together with other key governance documents, available on its website.
Information about the Group’s corporate governance framework (including Code of Ethics, Board and Committee
charters, and other selected key governance codes and policies) is available to view on the Group’s website.
FINANCIAL AND NON-FINANCIAL REPORTING
Recommendation 4.3: Financial reporting should be balanced, clear and objective. An issuer should provide
non-financial disclosure at least annually, including considering environmental, economic and social
sustainability factors and practices. It should explain how operational or non-financial targets are measured.
Non-financial reporting should be informative, including forward looking assessments, and align with key
strategies and metrics monitored by the board.
FINANCIAL REPORTING
The Audit and Risk Committee is accountable to the Board for the recommendations of the external auditors,
Deloitte, directing and monitoring the audit function and reviewing the adequacy and quality of the annual audit
process. This includes receiving reports on the Group’s internal information system control environment. The
Committee oversees the quality and integrity of external financial reporting including the accuracy, completeness
and timeliness of financial statements, and ensuring the financial reporting is balanced, clear and objective. It
reviews annual and half year financial statements and makes recommendations to the Board concerning the
application of accounting policies and practices, areas of judgement, compliance with accounting standards,
stock exchange and legal requirements, and the results of the external audit.
Management’s accountability for the Group’s financial reporting is reinforced by the written confirmation from
the Managing Director and Chief Financial Officer that, in their opinion, financial records have been properly
maintained and that the financial statements comply with the appropriate accounting standards and give a true
and fair view of the financial position and performance of the Group. Such representations are given based on
a sound system of risk management and internal control which is operating effectively in all material respects in
relation to financial reporting risk.
NON-FINANCIAL REPORTING
The Group assesses its exposure to environmental, economic and social sustainability as part of the overall
framework for managing risk (see Principle 6 – Risk Management). The Group is committed to improving
standards of environmental performance to enable a more efficient and sustainable future. Accordingly, the
Group follows long standing practices regarding management of environmental factors affecting the business,
including strategies relating to water conservation, viticulture management, sustainable winegrowing practices
and wetland preservation initiatives.
The Group has remained focused on the development of measurable initiatives in respect to three key areas;
inclusion, people and climate change. Each of these areas is key to supporting a value based organisation which
focuses on harnessing the passion of people who are intent on personal achievement and growth.
During the year the Group has commenced research on how the potential impacts of climate change and carbon
measurement will impact the Group. The Group has engaged with New Zealand Winegrowers, other industry
participants on their carbon measurement/reduction journey and external consultants Toitu. The Winegrowers
led Sustainable Winegrowing New Zealand (SWNZ) programme remains the appropriate umbrella programme
for Delegat’s wider sustainability endeavours. Delegat is a founding member of SWNZ dating back to 1996 and
all operations are fully accredited and regularly audited by SWNZ. The SWNZ programme has six key elements;
waste, water, pest & disease, people, soil health, and climate change.
CORPORATE GOVERNANCE STATEMENT CONTINUED
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202184
NON-FINANCIAL REPORTING (CONTINUED)
A Sustainability and Climate Change Steering Group has been established during the year to develop Delegat
Group’s Sustainability framework and plan (incorporating current SWNZ framework). The Sustainability and
Climate Change Committee will work through the Task Force on Climate-related Financial Disclosures (TCFD)
reporting framework recommendations for Climate Change Governance, Strategy and Risk and intends to make
this available as disclosure in the Group’s 2022 Annual Report.
PRINCIPLE 5 – REMUNERATION
The remuneration of directors and executives should be transparent, fair and reasonable.
DIRECTORS’ REMUNERATION
Recommendation 5.1: An issuer should recommend director remuneration to shareholders for approval in a
transparent manner. Actual director remuneration should be clearly disclosed in the issuer’s annual report.
REMUNERATION – EXECUTIVE CHAIRMAN AND MANAGING DIRECTOR
The criteria for reviewing the remuneration for Executive Directors includes, as appropriate, advice obtained
from external independent consultants, specific market comparison of roles using independent surveys,
consideration of role expectations and requirements, and level of achievement against business and personal
objectives.
REMUNERATION – NON-EXECUTIVE DIRECTORS
Remuneration levels are set at competitive levels to attract and retain appropriately qualified Directors.
The Group’s policy is to pay its Directors in cash. The fees of the Non-Executive Directors are set within the
aggregate amount determined by Shareholders by a resolution. The criteria for reviewing Non-Executive
Director remuneration includes obtaining advice from external consultants as appropriate, information on Board
arrangements for other corporations of similar size and complexity, and the review of current and expected
workloads (including as Chairman of the Board Committees). The NZX Listing Rules require that the Shareholders
approve the total aggregate amount payable to all Directors as Directors’ fees. Approval was last sought in 2016,
when the pool limit was set at $400,000 per annum. Director remuneration is included in the Annual Report on
page 91.
REMUNERATION POLICY
Recommendation 5.2: An issuer should have a remuneration policy for remuneration of directors and officers,
which outlines the relative weightings of remuneration components and relevant performance criteria.
The Group has adopted a Remuneration Policy which sets out the remuneration principles that apply to all Non-
Executive Directors and all employees including senior management, to ensure that remuneration practices
are fair and appropriate, and that there is a clear link between remuneration and performance. The Group
is committed to applying fair and equitable remuneration and reward practices in the workplace, taking into
account internal and external relativity, the commercial environment, the ability to achieve the Group’s business
objectives and the creation of Shareholder value. Under the Group’s remuneration practices, job size relative to
the relevant competitive market for talent, as well as individual performance against defined key performance
objectives, are key considerations in all remuneration-based decisions.
EMPLOYEE REMUNERATION
The number of employees and former employees within the Group receiving remuneration and benefits above
$100,000 relating to the year ended 30 June 2021 is included in the Annual Report on page 94.
CORPORATE GOVERNANCE STATEMENT CONTINUED
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202185
MANAGING DIRECTOR (CHIEF EXECUTIVE OFFICER) REMUNERATION
Recommendation 5.3: An issuer should disclose the remuneration arrangements in place for the CEO in its
annual report. This should include disclosure of the base salary, short-term incentives and the performance
criteria used to determine performance based payments.
The remuneration of the Managing Director (John Freeman) for the period ended 31 March 2021, and the
remuneration of the Acting Managing Director (Graeme Lord) for the period from 1 April to 30 June 2021, is
included in the Annual Report on page 91.
The remuneration of the Managing Director comprises both a fixed and variable performance component. Fixed
remuneration includes a base salary, contributions to superannuation, wine and phone allowances. The Acting
Managing Director did not receive a variable performance incentive this financial year.
SENIOR MANAGEMENT
The Group’s senior management is appointed by the Managing Director. Senior management’s sales executives’
key performance objectives are comprised of specific Group financial objectives along with business related
individual objectives. Establishing and monitoring these key performance objectives is undertaken annually by
the Managing Director, recommending them to the Remuneration Committee, for approval. The performance
of the sales executives against these key performance objectives is evaluated annually and serves as a key
determinant of any short-term incentive scheme values and payments.
SHORT-TERM INCENTIVE PAYMENTS
Short-term incentive payments are at risk cash payments designed to motivate and reward for short-term (within
each financial year) performance. The target value of a short-term incentive payment is set by the Managing
Director with a specified dollar potential available to each participant in the scheme. The target areas for all
employees who are entitled to a short-term incentive payment are set based on a combination of Group financial
performance and specific sales targets relative to the employee’s area of responsibility and individual goals. The
weightings applied to each of the target areas will be generally consistent throughout the Group for roles entitled
to a short-term incentive payment, but may vary depending on specific areas of focus as determined by the
Managing Director. The Remuneration Committee approves senior management short-term incentive payments
and the Managing Director approves the short-term incentive payments to be made to sales employees at the
end of the financial year and approves the sales employee’s targets for the following year.
PRINCIPLE 6 – RISK MANAGEMENT
Directors should have a sound understanding of the material risks faced by the issuer and how to manage them.
The board should regularly verify that the issuer has appropriate processes that identify and manage potential and
material risks.
RISK MANAGEMENT
Recommendation 6.1: An issuer should have a risk management framework for its business and the issuer’s
board should receive and review regular reports. An issuer should report the material risks facing the business
and how these are being managed.
Risk management is an acknowledged important factor in corporate governance. The Board is responsible for
the Group’s risk assessment, management and internal control and considers it has carried out a robust risk
assessment process. The Board has identified a number of risks in the Group’s operations that are commonly
faced by other entities in the industry in which the Group operates. The Board and management of the Group
considers they have taken all reasonable steps to manage and mitigate these risks.
CORPORATE GOVERNANCE STATEMENT CONTINUED
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202186
RISK MANAGEMENT (CONTINUED)
In viticulture the issues of weather, disease and pest control are an ongoing management activity. Viticultural
techniques are in place and in practice which the Board and management considers effectively mitigate this risk.
Brand reputation and brand security are identified risks that are the subject of ongoing surveillance, and
techniques and practices are in place which the Board and management considers mitigate this risk effectively.
Supply chain risk is monitored, and the Group has identified a range of suppliers operating in different jurisdictions
to mitigate the risk of the loss of a single supplier.
Technology risk, particularly in relation to hacking or illegal access to systems, is managed through a dedicated
information technology department, along with external consultants which the Board and management consider
mitigate this risk effectively. The Audit and Risk Committee regularly receives technology control finding updates.
Information reporting includes updates about the status of previously raised items, fraud risk management,
cyber risks and security monitoring, access governance and vendor management reviews, along with the latest
assessment of evolving risk matters for consideration.
The Managing Director, together with senior management, meets regularly on risk assessment affecting the
business and maintain a risk matrix which is used to monitor and mitigate these risks. A risk matrix measures
the impact of the risk and likelihood of occurrence and is provided to the Audit and Risk Committee and Board
annually. The Group maintains insurance policies that it considers adequate to meet insurable risks.
HEALTH AND SAFETY
Recommendation 6.2: An issuer should disclose how it manages its health and safety risks and should report
on its health and safety risks, performance and management.
The health, safety and wellbeing of people is of the utmost importance to Delegat. A safe and healthy workplace
is one in which people and suppliers are accountable and empowered to work together to protect and promote
the health, safety and wellbeing of all.
The Board has responsibility for ensuring the Group maintains a health and safety management system that
meets best practice standards to protect the health and safety of employees and contractors engaged by the
Group. A Workplace Health and Safety Report, which covers Group performance across a range of measures
of Health and Safety, is presented to and reviewed by the Board at each Board meeting. The Board and senior
management are appraised of all notifiable incidents and injuries and the actions taken to ensure the health and
wellbeing of injured persons. Actions taken to prevent incident reoccurrence are also advised.
The Group People and Culture Manager and specialist team members in the People and Culture function assist
the Board in meeting its responsibilities under the Health and Safety at Work Act 2015, as well as other regulations
and policies.
Management operates and assesses the effectiveness of risk assessment and mitigation, safety processes and
systems, capability of staff and the general culture of the business in relation to safety.
The Group has implemented a Health and Safety Risk Matrix to identify specific hazards and risks, assess their
severity of impact and likelihood of occurrence, document mitigation strategies and determine the level of
residual risk. This matrix is reviewed at least annually by the Board, and annual Health and Safety objectives and
key performance indicators are set for the business based on the significant risks identified.
The Group has introduced wellbeing initiatives to help create a healthy working environment with the goal for
promoting and maintaining physical, mental, and social wellbeing for everyone at Delegat.
CORPORATE GOVERNANCE STATEMENT CONTINUED
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202187
PRINCIPLE 7 – AUDITORS
The board should ensure the quality and independence of the external audit process.
EXTERNAL AUDIT
Recommendations 7.1 and 7.2: The board should establish a framework for the issuer’s relationship with its
external auditors. This should include procedures prescribed in the NZX Code. The external auditor should
attend the issuer’s annual shareholders meeting to answer questions from shareholders in relation to the
audit.
The Board has adopted a policy in relation to the provision of the non-audit services by the Group’s external
auditor to ensure the independence of the external auditor. This is based on the principle that work that may
detract from the external auditor’s independence and impartiality (or that may be perceived as doing so) should
not be carried out by the external auditors.
The Audit and Risk Committee is responsible for the oversight of the Group’s external audit arrangements. These
arrangements include procedures for the matters described in Recommendation 7.1 of the NZX Code.
The Audit and Risk Committee is committed to ensuring the Group’s external auditor is able to carry out its
work independently so that financial reporting is reliable and credible. The Audit and Risk Committee is
responsible for the appointment of Delegat’s external auditors, its terms of engagement and the level of fees
incurred (subject to shareholder approval). The Audit and Risk Committee monitors the nature and extent of
other services provided by the external auditor, and the ratio of audit fees to non-audit fees, to ensure that those
services are complementary to the external audit and compatible with maintaining external audit independence.
Regular rotation of the external audit firm is not mandated, however rotation of the key audit partner of Delegat
is required every five years. Given Ernst & Young had been Delegat’s external auditor for the last fifteen years,
the Board considered it was an appropriate time to review the audit firm in FY21. Following a formal request for
proposal for external audit and taxation services, the Board recommended that Deloitte be appointed as its
new external auditor in October 2020. This recommendation was formally approved by shareholders at Delegat
Group’s Annual Meeting held in November 2020. Total fees paid to Deloitte in its capacity as auditor are included
in the Annual Report on page 49.
The Group invites representatives of Delegat’s external auditors to attend the Annual Meeting of Shareholders
and for the lead audit partner to be available to answer Shareholder questions about the conduct of their audit
and the preparation and content of the auditor’s report.
INTERNAL AUDIT
Recommendation 7.3: Internal audit functions should be disclosed.
The Group does not have an internal audit function. Procedures have been established at Board and executive
management levels that are designed to safeguard the assets and interests of the Group and ensure the
integrity of reporting. These include accounting, financial reporting and internal control policies and procedures.
The Board acknowledges that it is responsible for the overall internal control framework but recognises that
no cost-effective internal control system will preclude all errors and irregularities. To assist in discharging this
responsibility, the Board has instigated an internal control framework as follows:
• Financial reporting – there is a comprehensive budgeting system with an annual budget approved by the Board.
Monthly actual results are reported against budget and revised forecasts for the year are prepared regularly.
The consolidated entity reports to Shareholders half-yearly. Procedures are also in place to ensure that price-
sensitive information is reported to the NZX in accordance with continuous disclosure obligations;
CORPORATE GOVERNANCE STATEMENT CONTINUED
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202188
INTERNAL AUDIT (CONTINUED)
• Operating unit controls – financial controls and standard operating procedures, including information system
controls, are in operation throughout the consolidated entity; and
• Investment appraisal – the consolidated entity has clear guidelines for capital expenditure. These include
annual budgets, as well as detailed appraisal and review procedures.
PRINCIPLE 8 – SHAREHOLDER RIGHTS AND RELATIONS
The board should respect the rights of shareholders and foster constructive relationships with shareholders that
encourage them to engage with the issuer.
INFORMATION FOR THE SHAREHOLDERS
Recommendation 8.1: An issuer should have a website where investors and interested stakeholders can
assess financial and operational information and key corporate governance information about the issuer.
The Group is committed to an open and transparent relationship with Shareholders. The Board aims to ensure that
all Shareholders are provided with all information necessary to assess the Group’s direction and performance.
This is undertaken through a range of communication methods, including periodic and continuous disclosures to
the NZX, half-year and annual reports and the Annual Shareholders’ Meeting. The Managing Director and Chief
Financial Officer present via an analysts’ and investors’ conference call after the release of the interim and final
year results and answer questions raised by analysts and investors. The Group’s website provides financial and
operational information, details about its Directors and copies of its governance documents, for investors and
interested stakeholders to access at any time.
COMMUNICATING WITH SHAREHOLDERS
Recommendation 8.2: An issuer should allow investors the ability to easily communicate with the issuer,
including providing the option to receive communications from the issuer electronically.
Shareholders have the option of receiving their communications electronically, including by email or through
the Group’s website. Shareholders are actively encouraged to take up this option. The Board has always been
committed to having an open dialogue with Shareholders and welcomes investor enquiries.
SHAREHOLDER VOTING RIGHTS
Recommendations 8.3 and 8.4: Quoted equity security holders should have the right to vote on major
decisions which may change the nature of the issuer in which they are invested. If seeking additional equity
capital, issuers of quoted equity securities should offer further equity security holders of the same class on a
pro rata basis, and on no less favourable terms, before further equity securities are offered to other investors.
In accordance with the Companies Act 1993, the Group’s Constitution and the NZX Listing Rules, the Group
refers any significant matters to Shareholders for approval at a Shareholders’ Meeting. All shareholders are
entitled to attend the Group’s Annual Shareholders’ Meeting, either in person or by representative. Resolutions
at shareholders’ meetings are by way of poll, where each shareholder is entitled to one vote per share.
NOTICE OF ANNUAL SHAREHOLDERS’ MEETING
Recommendation 8.5: The board should ensure that the notices of annual or special meetings of quoted
equity security holders is posted on the issuer’s website as soon as possible and at least 20 working days
prior to the meeting.
The Group posts any Notices of Shareholders’ Meetings on its website as soon as these are available. The general
practice is to make these available not less than four weeks prior to the Shareholders’ Meeting.
CORPORATE GOVERNANCE STATEMENT CONTINUED
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202189
OTHER DISCLOSURES
DISCLOSURE OF INTERESTS BY DIRECTORS
In accordance with section 140(2) of the Companies Act 1993, the Directors have made general disclosure of their
relevant interests for entry into the Group’s Interests Register.
Directors have declared interests in the following transactions with subsidiary companies during the financial year:
• Delegat Australia Pty Limited paid fees to Yaroona Pty Limited, a company in which a Director of Delegat
Australia Pty Limited has an interest;
• Delegat Limited paid fees to Camelot Trust Pte. Limited, a company in which a Director of Delegat (Singapore)
Pte. Limited has an interest;
• Barossa Valley Estate Pty Limited and Delegat Limited paid fees to Range Road Estate Pty Limited, a company
in which a Director of Barossa Valley Estate Pty Limited has an interest;
• Delegat Limited paid consultancy fees to RL Wilton for consultancy services supplied during the course of the
year; and
• Delegat Limited paid consultancy fees to Seacliffe Consultancy Limited, a company in which GS Lord is a
Director, for consultancy services supplied up until 31 March 2021.
The details of these transactions are given in Note 20 to the financial statements, “Related Parties”.
At 30 June 2021 and 27 August 2021 the following Directors, or entities related to them, had interests in the following
company shares:
ORDINARY SHARES
Delegat Group LimitedBeneficialNon-Beneficial
JN Delegat
1
– 6 6 , 8 5 7,14 2
RS Delegat
1
– 6 6 , 8 5 7,14 2
GS Lord
1
– 6 6 , 8 5 7,14 2
1
JN Delegat, RS Delegat and GS Lord (Lord Trustee Limited) jointly hold non-beneficially 66,857,142 shares in their capacity as trustees of the
Delegat Share Protection Trust.
SHARE DEALINGS BY DIRECTORS
Between 5 March 2021 and 10 March 2021, JA Freeman sold a total of 11,000 shares of Delegat Group Limited for an
average consideration of $14.73 per share.
Between 18 December 2020 and 12 January 2021, RL Wilton sold a total of 34,128 shares of Delegat Group Limited
for an average consideration of $15.41 per share.
No other Director dealt in any shares of the Company, or in the shares of a subsidiary company during the year.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202190
OTHER DISCLOSURES CONTINUED
REMUNERATION OF DIRECTORS
Directors received the following fees and remuneration from Delegat Group Limited:
2021 2020
$000 $000
Non-Executive Directors
RL Wilton (Retired 25 November 2020)
1
31 75
RS Delegat 75 75
AT Jackson
2
85 85
SJ Cave (Resigned 31 August 2020)
3
14 85
PM Muir (Appointed 31 August 2020)
4
71 –
Executive Directors
5
JN Delegat 839 829
GS Lord (Appointed 1 July 2020)
6
311 –
JA Freeman (Resigned 31 March 2021)
7
925 1,067
1
Robert Wilton was paid $50,000 (2020: $100,000) for consulting services provided to Delegat Limited, in addition to Directors fees. Robert
Wilton retired from his position as Non-Executive Director effective 25 November 2020.
2
Alan Jackson was paid $10,000 (2020: $10,000) in addition to his Director fees for his role as Chair of the Audit and Risk Committee.
3
Shelly Cave retired from her position as Non-Executive Director on 31 August 2020. Shelley Cave was paid $2,000 (2020: $10,000) in
addition to her Director fees for her role as Chair of the Remuneration Committee.
4
Phillipa Muir was appointed as a Non-Executive Director on 31 August 2020. Phillipa Muir was paid $8,000 (2020: $nil) in addition to her
Director fees for her role as Chair of the Remuneration Committee.
5
Executive Directors remuneration includes salary and benefits received in their capacity as employees. Executive Directors do not receive
Directors fees.
6
Graeme Lord was appointed as a Non-Executive Director on 1 July 2020 and was subsequently appointed as Acting Managing Director on 1
April 2021. Graeme Lord’s remuneration includes Non-Executive Director fees of $56,000 to 31 March 2021 and base salary of $250,000 and
other benefits of $5,000 as Executive Director from 1 April to 30 June 2021 (2020: Directors fees of $nil, base salary of $nil and other benefits
of $nil). Seacliffe Consultancy Limited, a company in which Graeme Lord is a Director, was paid $198,000 (2020: $nil) for consulting services
provided to Delegat Limited, in addition to Directors fees. Graeme Lord did not receive any short-term incentive payments.
7
John Freeman resigned from his position as Managing Director effective 31 March 2021. John Freeman’s remuneration includes base salary
of $622,000, short term incentive payments of $nil and other benefits of $303,000 (2020: base salary of $809,000, short term incentive
payments of $225,000 and other benefits of $33,000).
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202191
OTHER DISCLOSURES CONTINUED
DIRECTORS AND OFFICERS’ INSURANCE LIABILITY
As permitted by the New Zealand Companies Act 1993, the Company has arranged a policy of Directors and Officers’
liability insurance which insures those persons indemnified to certain liabilities and costs.
STOCK EXCHANGE LISTINGS
The Company’s shares are listed on the New Zealand Stock Exchange.
20 Largest Shareholders as at 30 June 2021
Holder Shares Held % of Shares
Jakov Nikola Delegat, Rosamari Suzan Delegat & Lord Trustee Limited 6 6 , 8 5 7,14 2 66.11
Kevin Glen Douglas & Michelle McKenney Douglas 5,269,113 5.21
TEA Custodians Limited - NZCSD
1
4,541,348 4.49
National Nominees New Zealand Limited - NZCSD
1
3,406,309 3.37
James Douglas & Jean Ann Douglas 2,470,878 2.44
Kevin Douglas & Michelle Douglas 2,468,817 2.44
Custodial Services Limited 1,147,026 1.13
Forsyth Barr Custodians Limited 976,551 0.97
Custodial Services Limited 858,867 0.85
Robert Lawrence Wilton 765,872 0.76
Accident Compensation Corporation - NZCSD
1
559,168 0.55
Custodial Services Limited 470,793 0.47
JP Morgan Chase Bank - NZCSD 1 390,097 0.39
Citibank Nominees (New Zealand) Limited - NZCSD
1
335,339 0.33
Custodial Services Limited 280,663 0.28
HSBC Nominees (New Zealand) Limited - NZCSD
1
259,140 0.26
Custodial Services Limited 225,393 0.22
Warren Fraser Sanderson & Elizabeth Ann Sanderson 200,000 0.20
BNP Paribas Nominees (NZ) Limited - NZCSD
1
176,056 0.17
Weijun Zhang & Yuhua Yang 150,000 0.14
Total for Top 20 91,808,572 90.78
1
Shareholdings held in New Zealand Central Securities Depository Limited (NZCSD). Total holding at 30 June 2021 in NZCSD were 10,054,380.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202192
OTHER DISCLOSURES CONTINUED
DISTRIBUTION OF ORDINARY SHARES
Holder Holders Shares Held % of Shares
1 – 5,000 1,596 2,705,754 2.68
5,001 – 10,000 304 1,910,937 1.89
10,001 – 100,000 203 3,820,828 3.78
100,001 plus
1
18 92,692,673 91.65
To t a l 2,121 101,130,192 100.00
1
NZCSD holdings are considered one holder for the purpose of the distribution of ordinary shares.
GEOGRAPHIC DISTRIBUTION
Holder Holders Shares Held % of Shares
New Zealand 2,068 90,711,471 89.70
United States of America 9 10,275,704 10.16
Australia 21 100,268 0.10
Other Overseas 23 42,749 0.04
To t a l 2,121 101,130,192 100.00
SUBSTANTIAL SECURITY HOLDERS
According to notices given to the Company under the Financial Markets Conduct Act 2013, as at 30 June 2021, the
substantial security holders in the Company are:
Substantial Security Holders Relevant Interest % of Shares Date of Notice
Jakov Nikola Delegat, Rosamari Suzan Delegat &
Lord Trustee Limited 66,857,142 66.11 21 Dec 2011
Douglas Irrevocable Descendants Trust; Douglas Family Trust;
K&M Douglas Trust 10,208,808 10.09 5 April 2017
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202193
OTHER DISCLOSURES CONTINUED
EMPLOYEE REMUNERATION
Section 211(1)(g) of the New Zealand Companies Act 1993 requires disclosure of remuneration and other benefits,
including redundancy and other payments made on termination of employment, in excess of $100,000 per year, paid
by the Company or any of its subsidiaries worldwide to any employees who are not Directors of the Company.
Fr o m To 2021 2020
$ $
100,001 110,000 24 27
110,001 120,000 18 21
120,001 130,000 18 8
130,001 140,000 9 13
140,001 150,000 13 9
150,001 160,000 11 14
160,001 170,000 8 7
170,001 180,000 12 11
180,001 190,000 7 10
190,001 200,000 6 5
200,001 210,000 1 2
220,001 230,000 2 –
230,001 240,000 2 3
240,001 250,000 1 2
250,001 260,000 4 4
260,001 270,000 1 2
270,001 280,000 3 –
280,001 290,000 2 3
290,001 300,000 1 2
300,001 310,000 2 1
310,001 320,000 – 1
320,001 330,000 2 3
330,001 340,000 3 1
350,001 360,000 – 2
360,001 370,000 1 –
370,001 380,000 1 1
380,001 390,000 – 1
390,001 400,000 – 1
400,001 410,000 1 –
420,001 430,000 1 –
470,001 480,000 1 1
560,001 570,000 1 1
570,001 580,000 – 1
156 157
SUBSIDIARY COMPANY DIRECTORS
Section 211(1)(2) of the New Zealand Companies Act 1993 requires the Company to disclose, in relation to its
subsidiaries, the total remuneration and value of other benefits received by Directors and former Directors and
particulars of entries in the interest registers made during the year ended 30 June 2021.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202194
OTHER DISCLOSURES CONTINUED
SUBSIDIARY COMPANY DIRECTORS (CONTINUED)
Apart from Delegat Australia Pty Limited, Delegat (Singapore) Pte. Limited and Barossa Valley Estate Pty Limited,
which are required to have a local resident as a Director of the Company, no wholly owned subsidiary has any employee
appointed as a Director of Delegat Group Limited or its subsidiaries who receives, or retains any remuneration or
other benefits, as a Director. No other Director of any subsidiary Company within the Group receives Director’s fees
or other benefits as a Director.
The following persons respectively held office as Directors of subsidiary companies at the end of the year or in the
case of those persons with the letter (R) after their name ceased to hold office during the year. Alternate Directors
are indicated by the letter (A) after their name.
Delegat Limited
JN Delegat, GS Lord, MR Annabell, RS Delegat (R), RL Wilton (R), JA Freeman (R)
Delegat Europe Limited
JN Delegat, GS Lord, MR Annabell, RL Wilton (R), JA Freeman (R)
Delegat Australia Pty Limited
JN Delegat, PJ Taylor, GS Lord, MR Annabell, RL Wilton (R), JA Freeman (R)
Delegat USA ,Inc.
JN Delegat, GS Lord, MR Annabell
Delegat Canada Limited
JN Delegat, GS Lord, MR Annabell, RL Wilton (R), JA Freeman (R)
Delegat (Singapore) Pte. Limited
JN Delegat, A Chew Peck Hwa, MR Annabell, RL Wilton (R), JA Freeman (R)
Oyster Bay Wines New Zealand Limited
JN Delegat
Barossa Valley Estate Pty Limited
JN Delegat, AW Hoey, GS Lord, MR Annabell, RL Wilton (R), JA Freeman (R)
DONATIONS
During the year, the Parent Company made donations of $nil and the subsidiaries made donations amounting to
$3,000.
NEW ZEALAND EXCHANGE WAIVERS
Delegat Group Limited has not obtained any waivers from the NZX in the financial year ended 30 June 2021.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202195
DIRECTORY
Directors
Jakov Nikola Delegat
Rosemari Suzan Delegat
Graeme Stuart Lord
Alan Trevor Jackson
Phillipa Margaret Muir
Registered Office
Level 31, 15 Customs Street West
Auckland 1010
PO Box 91681
Victoria Street West
Auckland 1142
Solicitors
Heimsath Alexander
Level 1, Shed 22, Prince’s Wharf
147 Quay Street
PO Box 105884
Auckland 1143
Auditors
Deloitte
Deloitte Centre, Levels 12-18, 80 Queen Street
Auckland 1010
Private Bag 115033
Shortland Street
Auckland 1140
Share Registrar
Computershare Investor Services Limited
Private Bag 92119
Auckland 1142
Level 2, 159 Hurstmere Road
Takapuna
Auckland 0622
Managing your shareholding online:
To change your address, update your payment
instructions and to view your registered details
including transactions, please visit:
www.investorcentre.com/NZ
General enquiries can be directed to:
enquiry@computershare.co.nz
Private Bag 92119
Auckland 1142
Telephone:
+64 9 488 8777
Facsimile:
+64 9 488 8787
Please assist our registry by quoting your CSN or
Shareholder number.
DELEGAT GROUP LIMITED AND SUBSIDIARIES. FOR THE YEAR ENDED 30 JUNE 202196
There’s
summertime.
And there’s
summer
moments.
WINNING
TOGETHER.
Thank you to all our
Great Wine People
around the world.
Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.
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