Gentrack Annual Report 2021
Annual
Report
2021
Gentrack
Group
Limited
5
6
8
10
12
15
19
63
Financial summary
Chairman and CEO’s commentary
Gentrack Board of Directors
Business update
Business update: Veovo
Our people and our planet
Financial statements
Corporate governance
Contents
14UK energy market events
77Corporate directory
Gentrack’s 30 years of expertise and experience
has made us a clear leader in providing solutions
across a broad utility segment – with leading
customers in both B2C and B2B energy and water
across many regions.
This breadth of capabilities is unique and
provides for a wider addressable market than
many of our competitors cannot target.
We are excited about the opportunities
that lie ahead as we partner with leaders to
move the industry into the sustainable era.
4
Financial
summary
$105.7m
REVENUE
Up 5.2% on FY20
$89.0m
UTILITIES
REVENUE
Up 8.8% on FY20
$26.0m
NET CASH
Up 54.8% on FY20
$81.9m
ARR
Up 0.7% on FY20
$12.7m
EBITDA
Up 5.0% on FY20
FINANCIAL SUMMARY / 5
The fiscal year 2021 for Gentrack was
an exciting year of progress, with major
restructuring completed and a return to
growth in the Utilities business. In Veovo,
we showed slight revenue decline and
maintained our position as an essential
supplier bringing net contribution to the
Group, despite the pressures of the
pandemic on the aviation industry.
Revenue growth was driven by an 8.8%
increase in Utilities to $89.0m from $81.8m in
FY20 with new customer wins and growth from
existing customers offsetting previous years’
losses. Veovo revenues were down from $18.7m
in FY20 to $16.7m due to continued impact of
Covid on the aviation industry, but pleasingly
annual recurring revenues (ARR) were up 7.7%
as new customers moved into live operation.
Underlying Group EBITDA of $12.7m is up 5.0%
on FY20, slightly ahead of the guidance issued
earlier this year. Costs were up 5.2% vs FY20
driven by increased investment in personnel,
with continued savings in non-personnel
costs. The Group achieved strong net cash
generation of $9.2m for the period resulting in
net cash of $26.0m at 30 September 2021.
In Utilities, the energy industry is going
through a rapid transformation to address
the triple challenge of decarbonisation,
decentralisation and digitalisation. At the
same time, the water industry is modernizing
to address better customer service and much
needed operational efficiencies. Both energy
Chairman and CEO’s
commentary
and water are moving away from large, on-
premise and inflexible systems to innovative,
agile, cloud-based solutions, like Gentrack.
This IT transformation is an essential step in
the industry’s move into cloud technologies
and the sustainable era.
With the energy transition well underway,
in the June 2021 Strategy Presentation we
communicated our three strategic growth
pillars for utilities – further developing our
customer base, winning new logos and rolling
out managed services.
In terms of developing our customer base, the
business performed strongly, with 72% of our
customers moving into a high performance
‘green’ status. Projects are being delivered
on time and on budget. Our customers are
turning to us to deliver more innovation for
them – particularly around capabilities for
electric vehicles, heat pumps, solar, data and
intelligence, profit and risk. Our Indian Delivery
Centre is now fully operational which has
helped us to improve revenue per FTE.
In new business, we won 7 new logos in our
core markets. Win momentum is on
the rise. Furthermore, we expect the
number of opportunities outside of our core
geographies where we now operate to be
significant, as suppliers around the world look
to innovative and cloud providers to disrupt
incumbent vendors offerings. This represents
significant future potential.
6 / CHAIRMAN AND CEO’S COMMENTARY
For our managed services pillar, we foresee
promising growth as we now have a well-
defined proposition, proven value metrics and
both a healthy pipeline and order book. We
look forward to reporting on progress for this
new growth area.
In Veovo, we are still feeling the impact of the
pandemic on the aviation industry but are
starting to see signs of global recovery. Despite
global restrictions we won 4 new logos, signed
extended support contracts and upgrades and
delivered 6 major projects across the globe. The
transition of our customers to our Passenger
Predictability SaaS platform has moved at pace
and we will continue the investment in R&D
in the next fiscal year to prepare us for the
recovery of the market.
On the people front, we are committed to
being a high performance, people-centric
technology organisation. We have put
this focus into action with higher reward,
more training and betterment where
required. Employee engagement is up and
the organisation is moving at pace. Our
commitment continues to focus on investing
in technology and people for both Utilities
and Veovo. We’d like to thank the great
team of Gentrack people across the world
for their dedication and innovation in a
transformational year for the company.
For FY22 we are forecasting growth beyond
FY21. This is despite the impact of the
pandemic on the aviation industry and the
recent unprecedented market conditions in
UK energy (see page 14).
CHAIRMAN AND CEO’S COMMENTARY / 7
Gary Miles
CEO
Andy Green, CBE
Chairman
Andy Green, CBE
Chair
Andy has an extensive
background in technology
leadership including CEO of Logica,
a £4bn turnover listed IT Services Company,
and CEO of BT Global Services, the enterprise
arm of British Telecom. In 2020 Andy was
awarded Commander of the British Empire
(CBE) for his contributions to the Information
Technology and British Space Industries. His
passion to transform the industry to support
sustainable water and energy resources is
further demonstrated by his roles as the
Chair of WaterAid UK and as a UK National
Infrastructure Commissioner. Spending time in
both Australia and the UK, he contributes both
a local presence and global perspective to
Gentrack’s customers and shareholders.
Nick Luckock
Non Executive Director
Nick is a Partner and a member
of the Investment Committee at
Hg Capital with extensive private
equity experience focusing on the
technology industry. He has deep experience
across a number of significant organisation
in the business services, financial processing
and technology sectors.
He is currently a Director at Achilles
Subholdings Ltd and has served as a Non
Executive Director at a variety of private
equity backed companies including British
based JLA, Radius Worldwide, Paycorp Group
Gentrack Board
of Directors
(Pty) Ltd (South Africa), XP Investimentos
(Brazil) and AGS Transact Technologies
Ltd (India).
Nick completed an MBA with Distinction at
INSEAD and a Bachelor of Commerce and Arts
(Honours) from the University of Melbourne.
Fiona Oliver
Non Executive Director
Fiona is an experienced Director
and Audit Committee Chair.
Her active board roles include
being a Director and Audit Committee
Chair of Freightways (NZX/ASX), First Gas
Group, BNZ Life Insurance and BNZ
Insurance Services.
Fiona has Executive level leadership
experience in asset management, funds
management and private equity, including
holding the roles of Chief Operating Officer
of BT Funds Management (NZ), Westpac’s
investment arm, and General Manager, Wealth
Management for AMP NZ. Fiona also managed
the Risk and Operations function of AMP’s
Sydney and (owned at the time) London
based Private Capital division. Fiona has
specialist knowledge of investments and the
capital markets.
Fiona holds degrees in Law and Arts from
the University of Auckland and is a qualified
Solicitor in New Zealand, New South Wales
and England. Prior to her management
career, Fiona practiced as a corporate
and commercial lawyer at a senior level in
Auckland, Sydney and London, specialising in
mergers and acquisitions.
8 / GENTRACK BOARD OF DIRECTORS
Stewart Sherriff
Non Executive Director
Stewart was appointed CEO of
New Zealand mobile challenger
2degrees in August 2013, having
served as the company’s Chairman for the
previous 4 years, and interim CEO since 1 April,
a position he held until he retired in June 2019.
He remains on the Board of 2degrees as a
Non-Executive Director.
Stewart began his 44 year career in
telecommunications with British Telecom. He
left the UK in 1984 to progress an international
career, working in 20 countries for various
Telcos. Stewart has learned mobile from
the ground up, starting as a technician,
progressing to a system specialist, field
services manager, BSS specialist and senior
engineer before entering senior management
as Head of Operations for Hong Kong operator
Smartone.
He became CTO at mobile pioneer Western
Wireless International in 1997, with
responsibility for IT, Engineering, Marketing,
Customer Care and Technical Operations. Six
years later, Stewart was seconded as CEO of
Meteor, Ireland’s third entrant mobile operator.
Under his leadership, Meteor became a
successful third player challenging Vodafone
and O2.
In 2006 he rejoined Western Wireless founders
John Stanton and Brad Horwitz at Trilogy
International Partners. As CTO he oversaw
Trilogy’s operations in Bolivia, Haiti, Dominican
Republic and New Zealand.
GENTRACK BOARD OF DIRECTORS / 9
Prior to chairing 2degrees, Stewart Chaired
Vega Slovenia and was Vice Chairman of
Telering Austria and served on the boards of
Vipnet Croatia, Voila Haiti, Neuvatel Bolivia and
jNetX USA.
Darc Rasmussen
Non Executive Director
Darc is a seasoned enterprise
software professional with over
25 years’ experience successfully
building and growing Software as a
Service (SaaS) and Cloud-based businesses
across global markets. He has spent his career
working and living in Europe, the USA and Asia/
Pacific, growing public and private companies
including Infor, SAP, IntraPower (Trusted Cloud)
and Integrated Research.
He led the SAP (NYSE:SAP) global CRM Line
of Business, building it from start-up to total
annual revenues of US$1.5 billion in 2007. He
was also CEO at Integrated Research (ASX:IRI)
where he led the company through a business
transformation strategy that delivered 70%+
revenue and profit growth along with a tripling
of the company’s market capitalisation. Darc
led the development and execution of a
product and go-to-market strategy that won
Integrated Research the distinction of Gartner
“Cool Vendor” and established the company
as the global market leader in Unified
Communications Performance Management.
Darc is also currently a Non-Executive Director
at Objective Corporation (ASX:OCL).
Business
update
Energy
With the energy revolution well underway,
the market continues to shift its focus to
customer centric business models, creation of
green products for consumers and prosumers
and data and analytics driven technology
that assures profitable operations and
the management of price fluctuation risks
inherent in energy retail.
Our customers are looking to Gentrack to
deliver needed innovation in each of these
areas. This is on the back of demand for
change from a) consumers b) regulators and
c) a widening competitive landscape for
operational efficiency and innovative green
product launches. Now, more than ever,
energy retailers need a strong and innovative
partner to move them into the sustainable
era. Gentrack is well positioned to lead this
transformation.
In the UK our operational metrics are
outperforming the market with 5 of the top 10
Which? ranked suppliers running on Gentrack.
We have onboarded a key tier 1 brand name
in Northern Ireland, expanding our footprint
outside the mainland UK, and this gives us a
beachhead to expand into the Republic of
Ireland. We are successfully delivering one of
the world’s largest I&C (B2B) transformation
programmes, supporting E.ON in their
merger with Npower and combining all their
business customers onto our Gentrack Cloud
for Utilities platform, delivering significant
performance improvements and cost savings.
10 / BUSINESS UPDATE
Geoff Childs
General Manager
United Kingdom
& Ireland
Mark Humphreys
General Manager
Australia
Allan Sampson
General Manager
New Zealand
In the Australian Energy retail market, we
took 4 of our customers live in major 5 Minute
Settlement projects this year, all through
remote delivery models. We renewed many
of our contracts this year and won 2 new
I&C customers. Our market-ready products
and regulatory model mean we offer quicker
deployment times in a market where the
complex Australian market interactions are a
significant barrier to entry.
In New Zealand we were selected to help
Trustpower complete the separation of their
B2C and I&C systems to enable the sale of
the retail business – delivering the project in
3 months to enable business transformation,
and without impacting business performance
or customer service.
We go into the new year with a strong pipeline,
including for our back office and margin
recovery managed services, and a more visible
presence in the market thanks to investments
made in marketing and focus on continuing to
improve our value to our customers.
Water
In water, the market is being driven to
transformation by an increased focus on
customer experience, community, cost to
serve and sustainability with a demand to be
data centric becoming critical. Gentrack is the
single source of truth for customers meter
and billing data. How we democratise this
data around the organisations, through our
integration platform and analytics solutions is
important to our customers and new utilities.
BUSINESS UPDATE / 11
In the UK, the water industry continues to
be a strong part of our customer base with
Gentrack holding majority market share in the
business segment.
The UK business water segment has
deregulated and has high demand for our
technology as utilities come under increasing
pressure of competition to deliver compelling
customer propositions and a digital and
market-leading customer experience. There is
also a large amount of regulatory shift in this
area as the regulator is continuing to shape
what a de-regulated market looks like.
Beyond the business segment, we also see
a big opportunity in domestic water. Despite
being a regulated segment, there is still an
increasing demand for improving customer
service and reducing cost to serve. This is
leading to current systems needing either an
upgrade or to be replaced as they are primarily
using large ERP systems which struggle to
adapt. Gentrack is in a leading position to
meet the evolving needs of this segment.
In Australia, we restarted our Water User
Groups this year and it was pleasing to see the
involvement of WaterAid in both those events.
We are supporting suppliers that are first in
the country to roll out smart meters and more
intelligent water networks. Our position in the
Australian water market is a leading one, and we
look to expand our pipeline in this segment.
We continue to watch the Three Waters Reform
in NZ with interest as it presents opportunities
for Gentrack to deliver innovation to the sector.
12 / BUSINESS UPDATE: VEOVO
Looking ahead, we are increasing our
investment in our technology focusing
on the key customer challenges of better
operational efficiency to reduce cost, improve
sustainability and deliver the best possible
passenger experiences. As passenger
numbers and aircraft movements improve this
will translate into airports increasing their
spending on upgrades and new technology.
Business update:
Veovo
We are starting to see reassuring signs of a
global recovery, although Covid continues
to have a significant impact on the aviation
industry as a whole – with passenger numbers
still down by around 50% on 2019, but building
220% on 2020 throughout 2021.
Despite global restrictions, we have won new
customers including Gatwick and 3 North
American customers. We’ve also signed
extended support contracts and upgrades for
our customers in both Europe and APAC. We’ve
also delivered major projects in Perth, Luton,
Cincinnati, New York, Sweden and Mexico.
Technology wise, we have continued our
move to SaaS for our passenger predictability
customers and invested in improving
technologies that support roll out and
support. We’re also focused on investing
in growing our AI/ML capabilities with
developments in resource management,
forecasting and prediction.
James Williamson
CEO
Veovo
BUSINESS UPDATE: VEOVO / 13
14 / UK ENERGY MARKET EVENTS
The UK energy market has seen
unprecedented conditions in 2021.
Extremely high wholesale price pressures,
coupled with a regulatory Price Cap, has
forced B2C energy suppliers to sell energy
at a loss. This phenomenon has resulted
in suppliers going into administration. As
reported, ten of the suppliers are Gentrack
customers – either entering the Supplier of
Last Resort (SoLR) or Special Administration
Regime in the case of Bulb (a top five
customer of Gentrack by revenue.)
Gentrack’s UK customer base is diversified
with a market share of more than 50% in the
contested water segment and the leading
position in the B2B energy segment. We also
have several stable B2C energy customers
who are now operating in a less competitive
market. For Gentrack as a whole its Utilities
business is diversified across different
segments and geographies.
UK energy
market events
OUR PEOPLE AND OUR PLANET / 15
We are a technology
partner for the Utilities
industry, helping them to
lead the way to a cleantech
future. As such we’re passionate people who
want to drive change through technology.
We believe in making a difference.
Our values reflect our culture, how we drive
decisions and how we connect with our
customers, partners, shareholders and
each other.
They are the reason to believe in what we
can achieve together. In 2021 we took the
opportunity to re-frame our values so we can
continue to work globally together to drive
efficiency in two of the planet’s most precious
resources: energy and water.
Our people
and our planet
for our customersfor each other
for the planet
We are loyal and we get the
job done
We express our opinions and
take accountability
Together we foster a collaboration
of culture & creativity
We are one team, we play to win
We’re humbled by the
power of nature
We believe cleantech is the
way forward
Frances Caldwell
Chief People Officer
In order to measure and act on our employee
engagement, we have invested in a market
leading engagement tool to help us
understand our employee feedback and
create shared action planning. This years
survey saw 91% of our colleagues provide their
views which will help us evolve our people
strategy, creating an exciting shared people
agenda as a result.
Reward
Reward plays a key role in attracting,
motivating and retaining talent. Gentrack
is focused on defining and maintaining
competitive compensation practices that
appeal to current and future talent. We believe
in motivating and rewarding performance
and as such have extended our variable
compensation eligibility to all colleagues.
2021 saw an opportunity to give Kudos and
recognition to many colleagues globally and
we will continue to take every opportunity
to recognise great performance across the
business and recognise those that align to
our values.
Learning, development
and growth
2021 saw the introduction of Empower, our
Global Learning tool, providing access to
6000 courses for all our people. We believe
in creating opportunities to learn – through
high pace and meaningful work and by
providing access to tools and training when
our people want it.
16 / OUR PEOPLE AND OUR PLANET
Our global people strategy is all about
understanding and enabling our people to
deliver their best – we believe in a high-
performance culture, centred on respect,
that rewards and recognises our people who
demonstrate our values every day.
We believe in a sustainable future and strive to
create a culture for our people that engages
our people who in turn are committed to us,
our customers and the planet.
Talent attraction, reward
and recognition
We are a growing company and always
welcome new talent to the Gentrack family.
We reach out to prospective employees in
a variety of ways, depending on location
and role, posting vacancies on our website,
encouraging referrals, actively promoting
via social media as well as partnering with
experts to source talent. We are committed to
developing our talent within, with promotions
and career moves locally and globally and
this year over 10% of our population were
promoted and we had a net people growth of
14% globally.
We aim to hire, inspire, engage and retain the
best people to power our strategy and vision
and as such recognise the importance of
employee engagement in driving sustainable
performance for all stakeholders.
2022 is an exciting year for our learning
agenda with our career pathways tool being
promoted across the business so all our
colleagues can see where their journey may
take them in Gentrack. We will continue to
invest in our people with ongoing leadership,
management and technical training as well as
development planning sessions to ensure our
people get the support they need.
Diversity, inclusion and wellbeing
2021 continued to be influenced by the global
pandemic and many of our locations have
experienced extended lockdowns – our teams
have continued to support our customers and
one another throughout this period. We will
be continuing to respond locally and globally
to support and highlight key diversity and
inclusion activities and as an organisation are
working together to continue to evolve our
wellbeing and enablement strategy.
OUR PEOPLE AND OUR PLANET / 17
Our sustainability approach
In previous years we have utilised a number
of tools to measure and improve our
sustainability performance. However in
2021 it was recognised that in order to help
our planet meet carbon reduction targets,
we needed to take a stronger stance on
sustainability within Gentrack. Therefore,
since mid 2021, we formed a global committee
working alongside sustainability experts
to put in place stringent new stretching
measures and metrics aligned with the 21
United Nations SDG goals.
This will ensure that we are both fully
compliant with the NZX requirements on
sustainability reporting for 2023 ahead of
time, and meet all the regulatory requirements
in each of the regions we are based as well as
enable our values to Respect the Planet.
Gentrack Group Limited
Financial
Statements
For the year ended 30 September 2021
20 / INDEPENDENT AUDITOR’S REPORT
A member firm of Ernst & Young Global Limited
IInnddeeppeennddeenntt AAuuddiittoorr’’ss RReeppoorrtt
TToo tthhee SShhaarreehhoollddeerrss ooff GGeennttrraacckk GGrroouupp LLiimmiitteedd -- RReeppoorrtt oonn tthhee aauuddiitt ooff tthhee ccoonnssoolliiddaatteedd ffiinnaanncciiaall ssttaatteemmeennttss
OOppiinniioonn
We have audited the consolidated financial statements of Gentrack Group Limited (“the Company”) and its subsidiaries
(together “the Group”) on pages 26 to 62, which comprise the consolidated statement of financial position of the Group as at
30 September 2021, and the consolidated statement of comprehensive income, consolidated statement of changes in equity
and consolidated statement of cash flows for the year then ended of the Group, and the notes to the consolidated financial
statements including a summary of significant accounting policies.
In our opinion, the consolidated financial statements on pages 26 to 62 present fairly, in all material respects, the consolidated
financial position of the Group as at 30 September 2021 and its consolidated financial performance and cash flows for the year
then ended in accordance with New Zealand equivalents to International Financial Reporting Standards and International
Financial Reporting Standards.
This report is made solely to the Company's shareholders, as a body. Our audit has been undertaken so that we might state to
the Company's shareholders those matters we are required to state to them in an auditor's report and for no other purpose. To
the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the
Company's shareholders, as a body, f or our audit work, for this report, or for the opinions we have formed.
B
Baassiiss ffoorr ooppiinniioonn
We conducted our audit in accordance with International Standards on Auditing (New Zealand). Our responsibilities under those
standards are further described in the
Auditor’s Responsibilities for the Audit of the Financial Statements section of our report.
We are independent of the Group in accordance with Professional and Ethical Standard 1
International Code of Ethics for
Assurance Practitioners (including International Independence Standards) (New Zealand)
issued by the New Zealand Auditing
and Assurance Standards Board, and we have fulfilled our other ethical responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Other than in our capacity as auditor we have no relationship with, or interest in, the Company or any of its subsidiaries. Partners
and employees of our firm may deal with the Group on normal terms within the ordinary course of trading activities of the
business of the Group.
O
Otthheerr mmaatttteerr
The consolidated financial statements of Gentrack Group Limited for the year ended 30 September 2020, were audited by
another auditor who expressed an unmodified opinion on those statements on 26 November 2020.
K
Keeyy aauuddiitt mmaatttteerrss
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
consolidated financial statements of the current year. These matters were addressed in the context of our audit of the
consolidated financial statements as a whole, and in forming our opinion thereon, but we do not provide a separate opinion on
these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.
INDEPENDENT AUDITOR’S REPORT / 21
A member firm of Ernst & Young Global Limited
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial statements section
of the audit report, including in relation to these matters. Accordingly, our audit included the performance of procedures
designed to respond to our assessment of the risks of material misstatement of the financial statements. The results of our
audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on
the accompanying consolidated financial statements.
R
Reevveennuuee rreeccooggnniittiioonn
WWhhyy ssiiggnniiffiiccaanntt HHooww oouurr aauuddiitt aaddddrreesssseedd tthhee kkeeyy aauuddiitt mmaatttteerr
The Group has reported revenues of $105 million. We
focused on the component of revenue related to software
implementation projects of $20 million, which is part of the
licences and project services revenue, as a key audit matter
due to inherent complexities of software implementation
projects and the estimates involved.
Revenue from implementation projects is considered to be a
distinct performance obligation and is recognised based on
the stage of completion using either the proportion of actual
hours at the reporting date compared to management
estimates for total forecast hours or with reference to
milestones.
Accurate recording of revenue is highly dependent on:
► Detailed knowledge of individual characteristics of a
contract, including unique terms, knowledge of software
and length of time to complete contractual milestones
► Ongoing adjustments to estimated hours to complete
implementation taking into consideration changes in
scope estimated timing and project delays, and
► Changes to total project revenue for contract variation or
additional billing for changes in scope or additional
hours incurred.
Disclosures in relation to the Group’s revenue are included in
note 3.2 to the consolidated financial statements.
In obtaining sufficient appropriate audit evidence, we:
► Selected a sample of implementation service projects focusing on
projects that were in progress at balance date. For the projects selected
for testing samples, where relevant, we:
► Checked revenue recognised was consistent with contractual terms
and accounting standard requirements, including any allocations
between initial license fee, design and implementation, and
maintenance phases of the contracts
► Obtained the project status reports as at 30 September 2021 and
checked whether the project manager had performed a review to
ensure the forecast used to calculate revenue through percentage of
completion was up to date
► Compared the forecast hours to complete based on the project
status reports core reporting systems to ensure revenue was
recognised in line with the project manager’s estimate
► Assessed the forecast hours through discussion with project
managers and senior management and challenged key assumptions
including consideration of alternative scenarios and how
management addressed risks in the contract
► Compared significant changes in total forecast hours to
correspondence with customers, legal documentation and/or
contract variation.
► Evaluated potential exposure to liquidated damaged by reviewing
legal correspondence and correspondence with customers, and
► Considered the historical accuracy of management estimates of
forecast hours by analysing previous forecasts to actual hours.
► Used data analytical techniques to assess the correlation between
revenue, deferred revenue and cash
► Validated a sample of cash receipts related to revenue transactions
► Assessed appropriateness of the deferred revenue balance at year end
by reference to the percentage of completion of implementation revenue
projects, and
► Considered the adequacy of the associated disclosures in the financial
statements.
22 / INDEPENDENT AUDITOR’S REPORT
A member firm of Ernst & Young Global Limited
GGooooddwwiillll aanndd BBrraanndd iinnttaannggiibbllee aasssseettss’’ iimmppaaiirrmmeenntt aasssseessssmmeenntt
WWhhyy ssiiggnniiffiiccaanntt HHooww oouurr aauuddiitt aaddddrreesssseedd tthhee kkeeyy aauuddiitt mmaatttteerr
At 30 September 2021, the Group records goodwill and
brand intangible assets with a combined value of $112
million, which make up 52% of the Group’s total assets.
The value-in -use of the Group’s cash generating units
(“CGUs”) is determined by management each reporting
period by impairment models that require significant
judgement and estimation in respect of future cash flow
forecasts, discount rates and terminal growth rate
assumptions. Changes in certain assumptions can lead to
significant changes in the assessment of the value-in -use.
Disclosures regarding the Group’s key assumptions adopted
and the sensitivity to reasonably possible changes in key
assumptions which could result in impairment for certain
CGUs are included in note 5.3 and 5.4 of the consolidated
financial statements.
In obtaining sufficient appropriate audit evidence, we:
► Understood the Group’s goodwill impairment assessment process and
identified any relevant controls
► Assessed the Group’s determination of CGUs based on our
understanding of the nature of the Group’s business units and
considered whether management’s assessment of CGUs was
appropriate
► Determined the appropriateness of using a discounted cash flow model
to calculate the value in use for each identified CGU and tested this for
mathematical accuracy
► Obtained the Group’s impairment models and assessed forecast cash
flow assumptions by comparison to actual results and the Board’s
approved budgets. We also challenged the reasonableness of the
managements forecast cashflows
► Considered the accuracy of previous Group cashflow forecasting to
inform our evaluation of forecasts included in the impairment models
► Involved our business valuation specialists to assess the terminal
growth and discount rates applied in consideration of relevant
comparators
► Challenged the assumptions and judgements used by management by
performing sensitivity analysis in relation to the discount rate and
forecast cash flows to consider the potential impact of changes in these
assumptions, and
► Evaluated the adequacy of the related financial statement disclosures.
IInnffoorrmmaattiioonn ootthheerr tthhaann tthhee ffiinnaanncciiaall ssttaatteemmeennttss aanndd aauuddiittoorr’’ss rreeppoorrtt
The Directors of the company are responsible for the Annual Report, which includes information other than the consolidated
financial statements and auditor’s 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.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our
knowledge obtained during the audit, or otherwise appears to be materially misstated.
If, based upon the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
D
Diirreeccttoorrss’’ rreessppoonnssiibbiilliittiieess ffoorr tthhee ffiinnaanncciiaall ssttaatteemmeennttss
The Directors are responsible, on behalf of the entity, for the preparation and fair presentation of the consolidated financial
statements in accordance with New Zealand equivalents to International Financial Reporting Standards and International
Financial Reporting Standards, and for such internal control as the Directors determine is necessary to enable the preparation
of financial statements that are free from material misstatement, whether due to fraud or error.
INDEPENDENT AUDITOR’S REPORT / 23
A member firm of Ernst & Young Global Limited
In preparing the consolidated financial statements, the Directors are responsible for assessing on behalf of the entity the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the Directors either intend to liquidate the Group or cease operations, or have no realistic
alternative but to do so.
A
Auuddiittoorr’’ss rreessppoonnssiibbiilliittiieess ffoorr tthhee aauuddiitt ooff tthhee ffiinnaanncciiaall ssttaatteemmeennttss
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
International Standards on Auditing (New Zealand) will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected
to influence the economic decisions of users taken on the basis of these consolidated financial statements.
24 / INDEPENDENT AUDITOR’S REPORT
A member firm of Ernst & Young Global Limited
A further description of the auditor’s responsibilities for the audit of the financial statements is located at the External Reporting
Board’s website: https://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/audit-report-1/.
This description forms part of our auditor’s report.
The engagement partner on the audit resulting in this independent auditor’s report is Grant Taylor.
Chartered Accountants
Wellington
25 November 2021
DIRECTORS RESPONSIBILITY STATEMENT / 25
DIRECTORS RESPONSIBILITY STATEMENT
GENTRACK FINANCIAL STATEMENTS / 10
The Directors are required to prepare financial statements for each financial year that present fairly the financial
position of Gentrack Group and its operations and cash flows for that period.
The Directors consider these financial statements have been prepared using accounting policies suitable to Gentrack
Group’s circumstances, which have been consistently applied and supported by reasonable judgements and
estimates, and that all relevant financial reporting and accounting standards have been followed.
The Directors are responsible for keeping proper accounting records that disclose with reasonable accuracy, at any
time, the financial position of Gentrack Group and to enable them to ensure that the financial statements comply with
the Companies Act 1993. They are also responsible for safeguarding the assets of Gentrack Group and hence for
taking reasonable steps for the prevention and detection of fraud and other irregularities.
The Board of Directors of Gentrack Group authorised these financial statements for issue on 25 November 2021.
For and on behalf of the Board of Directors:
Andy Green
Fiona Oliver
Chairman
Date: 25 November 2021
Director
Date: 25 November 2021
26 / FINANCIAL STATEMENTS
FINANCIAL STATEMENTS / 27
Financial
Statements
30 September
2021
28 / FINANCIAL STATEMENTS
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 12
2021 2020
SECTION NZ$000 NZ$000
Revenue
3.2,3.3
105,723 100,533
Expenditure
3.4
(92,996) (88,440)
Profit before depreciation, amortisation, acquisition related costs,
revaluation of financial liabilities, impairment of goodwill and
intangible assets, financing and tax
12,727 12,093
Depreciation and amortisation
3.5
(10,864) (12,354)
Revaluation of acquisition related financial liability
- 891
Impairment of goodwill and intangible assets
5.3
- (34,511)
Profit/(Loss) before financing and tax
1,863 (33,881)
Net finance income/(expense)
3.6
3,701 (386)
Profit/(Loss) before tax 5,564 (34,267)
Income tax (expense)/benefit
7.1
(2,375) 2,561
Profit/(Loss) attributable to the shareholders of the company 3,189 (31,706)
OTHER COMPREHENSIVE INCOME
Excess income tax benefit on share-based payments
91 -
Translation of international subsidiaries
(4,992) (882)
Total comprehensive loss for the period
(1,712) (32,588)
EARNINGS PER SHARE / (LOSS) ATTRIBUTABLE TO THE
SHAREHOLDERS OF THE COMPANY
(EXPRESSED IN DOLLARS PER SHARE)
Basic earnings per share
6.4
$0.03 ($0.32)
Diluted earnings per share
6.4
$0.03 ($0.32)
WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES ISSUED
Basic
6.4
98,761 98,645
Diluted
6.4
103,128 100,053
The above Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
FINANCIAL STATEMENTS / 29
STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 13
2021 2020
SECTION
NZ$000 NZ$000
CURRENT ASSETS
Cash and cash equivalents
4.3
25,957 19,321
Trade and other receivables
5.1
21,746 18,951
Income tax receivable
68 151
Inventory
5.8
362 464
Total current assets
48,133 38,887
NON-CURRENT ASSETS
Property, plant and equipment
5.5
2,683 2,763
Lease assets
9.1
8,162 10,338
Goodwill
5.2
106,766 106,599
Intangibles
5.4
37,698 45,428
Deferred tax assets
7.2
5,391 4,649
Total non-current assets
160,700 169,777
Total assets
208,833 208,664
CURRENT LIABILITIES
Bank loans
4.2
- 2,536
Trade payables and accruals
5.6
4,513 3,905
Lease liabilities
9.1
1,376 2,692
Contract liabilities
12,695 12,419
GST payable
1,931 3,206
Employee entitlements
5.7
9,535 5,552
Income tax payable
1,322 -
Total current liabilities
31,372 30,310
NON-CURRENT LIABILITIES
Lease liabilities
9.1
11,176 12,435
Employee entitlements
5.7
539 428
Deferred tax liabilities
7.2
3,305 4,997
Total non-current liabilities
15,020 17,860
Total liabilities
46,392 48,170
Net assets
162,441 160,494
EQUITY
Share capital
6.1
191,699 191,229
Share based payment reserve
3,888 699
Foreign currency translation reserve
1,790 6,782
Retained earnings
(34,936) (38,216)
Total equity
162,441 160,494
The above Statement of Financial Position should be read in conjunction with the accompanying notes.
For and on behalf of the Board who authorised these financial statements for issue on 25 November 2021.
Andy Green Fiona Oliver
Chair Director
Date: 25 November 2021 Date: 25 November 2021
30 / FINANCIAL STATEMENTS
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 14
2021
SHARE
CAPITAL
SHARE
BASED
PAYMENT
RESERVE
RETAINED
EARNINGS
TRANSLATION
RESERVE
TOTAL
EQUITY
NZ$000
SECTION
Balance as at 1 October
191,229 699 (38,216) 6,782 160,494
Profit attributable to the
shareholders of the company
- - 3,189 - 3,189
Other comprehensive income/(loss)
- - 91 (4,992) (4,901)
Total comprehensive
income/(loss) for the period,
net of tax
- - 3,280 (4,992) (1,712)
TRANSACTION WITH OWNERS
Issue of share capital
6.1, 6.2
470 (413) 57
Share-based payments
6.2
- 3,602 - - 3,602
Balance at 30 September
191,699 3,888 (34,936) 1,790 162,441
2020
SHARE
CAPITAL
SHARE
BASED
PAYMENT
RESERVE
RETAINED
EARNINGS
TRANSLATION
RESERVE
TOTAL
EQUITY
NZ$000
SECTION
Balance as at 1 October
191,229 389 (1,673) 7,664 197,609
Change in accounting policy
- -
(1,833) - (1,833)
Restated total equity at 1
October
191,229 389 (3,506) 7,664 195,776
Loss attributable to the
shareholders of the company
- - (31,706) - (31,706)
Other comprehensive loss
- - - (882) (882)
Total comprehensive income
for the period, net of tax
- - (31,706) (882) (32,588)
TRANSACTION WITH OWNERS
Dividend paid
6.3
- - (3,004) - (3,004)
Share-based payments
6.2
- 310 - - 310
Balance at 30 September
191,229 699 (38,216) 6,782 160,494
The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.
FINANCIAL STATEMENTS / 31
STATEMENT OF CASHFLOWS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 15
2021 2020
SECTION
NZ$000 NZ$000
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
103,251 110,731
Payments to suppliers and employees
(85,957) (83,547)
Lease liability finance charge
9.1
(814) (931)
Income tax paid
(3,535) (4,287)
Net cash inflow from operating activities
12,945 21,966
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property, plant and equipment
5.5
(663) (324)
Purchase of intangible assets
5.4
- (331)
Payment of acquisition related option
- (2,419)
Net cash outflow from investing activities
(663) (3,074)
CASH FLOWS FROM FINANCING ACTIVITIES
Payments for lease liabilities
(2,678) (2,497)
Drawdown of borrowings
- 5,007
Repayment of borrowings
(2,564) (6,871)
Interest paid
(176) (375)
Dividends paid
6.3
- (3,004)
Net cash outflow from financing activities
(5,418) (7,740)
Net increase in cash held
6, 864 11,152
Foreign currency translation adjustment
(228) (457)
Cash at beginning of the financial period
19,321 8,626
Closing cash and cash equivalents
25,957 19,321
The above Statement of Cash Flows should be read in conjunction with the accompanying notes.
32 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 16
GENERAL INFORMATION ACCOUNTING POLICES CRITICAL JUDGEMENTS
GENERAL INFORMATION
The notes are consolidated into nine sections. Each section contains an introduction and general
information which is indicated by the symbol above. The layout of these financial statements has been
streamlined to present them in a way that is more intuitive for readers to follow. This is achieved by laying
out the accounting policies and critical judgements alongside the notes and focusing information in a way
which provides increased clarity and ease of understanding.
The first section details general information about Gentrack Group and guidance on how to navigate through the
financial statements.
ACCOUNTING POLICIES
The principal accounting policies adopted in the preparation of these financial statements are set out
throughout the document where they are applicable. These policies have been consistently applied to
all the years presented, unless otherwise stated. Certain comparatives have been updated to ensure
consistency with current year presentation.
Accounting policies are identified by this symbol above.
CRITICAL JUDGEMENTS
The preparation of the financial statements requires management to make judgements,
estimates and assumptions that affect the reported amounts in the financial statements.
Management continually evaluates its judgements and estimates in relation to assets, liabilities,
contingent liabilities, revenue, and expenses. Management bases its judgements and estimates on historical
experience and on various other factors it believes to be reasonable under the circumstances, the result of
which form the basis of the carrying values for assets and liabilities that are not readily apparent from other
sources. Actual results may differ from these estimates under different assumptions and conditions and may
materially affect financial results or the financial position reported in future periods.
Further details of the nature of these critical judgements and estimates may be found throughout the financial
statements as they are applicable and are identified by this symbol.
FINANCIAL STATEMENTS / 33
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 17
1. GENERAL INFORMATION
Gentrack Group Limited is a limited liability company, domiciled and incorporated in New Zealand and registered
under the New Zealand Companies Act 1993. The registered office of the Company is 17 Hargreaves Street, St Marys
Bay, Auckland 1011, New Zealand.
The financial statements presented are for Gentrack Group Limited and its subsidiaries (Gentrack Group) for the year
ended 30 September 2021. Prior year comparatives are for the year ended 30 September 2020.
The financial statements of Gentrack Group for the year ended 30 September 2021 were authorised for issue in
accordance with a resolution of the directors on 25 November 2021.
Gentrack Group’s principal activity is the development, integration, and support of enterprise billing and customer
management software solutions for the utility (energy and water) and airport industries.
COVID-19 PANDEMIC
At 30 September 2021, the financial impact of COVID-19 on Gentrack Group overall has not been material. COVID-19
has not adversely impacted Gentrack Group’s Utility business, however the Airport business has been impacted by
COVID-19 with project cancellations and delays because of the uncertainty caused by COVID-19. Gentrack Group
continues to closely monitor the longer-term financial and economic implications of COVID-19 on its operations.
In preparing these financial statements Gentrack Group has considered the increased level of uncertainty resulting
from COVID-19 in applying its accounting estimates and judgements, details of the significant judgements and
estimates are provided below:
Accounting estimate and judgement area
Reference
License and project service revenue - Stage of completion
Section 3.2
Recoverability of trade receivables Section 5.1
Impairment testing – Five-year cashflow forecasts Section 5.3
34 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 18
2. BASIS OF PREPARATION AND ACCOUNTING POLICIES
This section outlines the legislation and accounting standards which have been followed in the preparation of
the financial statements along with explaining how the information has been consolidated and presented
.
2.1 KEY LEGISLATION AND ACCOUNTING STANDARDS
The financial statements of Gentrack Group have been prepared in accordance with New Zealand Generally
Accepted Accounting Practice (NZ GAAP). They comply with the New Zealand Equivalents to International Financial
Reporting Standards (NZ IFRS) and other applicable Financial Reporting Standards as appropriate to profit-oriented
entities. The financial statements comply with International Financial Reporting Standards (IFRS).
Gentrack Group is an FMC entity for the purposes of the Financial Reporting Act 2013 and Financial Markets Conduct
Act 2013 and is listed on the New Zealand Stock Exchange (NZX) and the Australian Securities Exchange (ASX).
The financial statements have been prepared in accordance with the requirements of the Financial Reporting Act
2013, Financial Markets Conduct Act 2013 and the Companies Act 1993.
2.2 BASIS OF CONSOLIDATION
Subsidiaries are entities over which Gentrack Group has control. Gentrack Group controls an entity when it is exposed
to, or has rights to, variable returns from its involvement with the entity and can affect those returns through its power
over the entity. In assessing control, potential voting rights that currently are exercisable are considered. Subsidiaries
are fully consolidated from the date that control is transferred to Gentrack Group. They are deconsolidated from the
date that control ceases.
The accounting policies of subsidiaries have been changed when necessary to align them with the policies adopted
by Gentrack Group.
Intra-group balances and any unrealised income and expenses arising from intra-group transactions, are fully
eliminated in preparing the financial statements.
FUNCTIONAL AND PRESENTATION CURRENCY
Items included in the financial statements of each of Gentrack Group’s entities are measured using the currency of the
primary economic environment in which the entity operates (the functional currency). The financial statements are
presented in New Zealand dollars (NZD) which is Gentrack Group’s presentation currency. All financial information
has been presented rounded to the nearest thousand dollars ($000) in the financial statements.
TRANSACTIONS AND BALANCES
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the
dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and
from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies
are recognised in the statement of comprehensive income. Foreign exchange gains and losses are presented in the
statement of comprehensive income within net finance expense.
FOREIGN CURRENCY TRANSLATION RESERVE (FCTR)
Gentrack Group translates the results of its foreign operations from their functional currencies to the presentation
currency using the closing exchange rate at balance date for assets and liabilities and the average monthly exchange
rates for income and expenses. The difference arising from the translation of the statement of financial position at the
closing rates and the statement of comprehensive income at the average rates is recorded within the foreign currency
translation reserve within the statement of changes in equity.
2.3 BUSINESS COMBINATIONS
Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on
which control is transferred to Gentrack Group. Control is the exposure or right to variable returns from involvement with
the entity and the ability to affect those returns through power over the entity.
Gentrack Group recognises the fair value of all identifiable assets, liabilities, and contingent liabilities of the acquired
business. Goodwill is measured as the excess cost of the acquisition over the recognised assets and liabilities. When
the excess is negative (negative goodwill), the amount is recognised immediately in the statement of comprehensive
income.
FINANCIAL STATEMENTS / 35
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 19
2.3 BUSINESS COMBINATIONS (CONTINUED)
Gentrack Group applies the anticipated acquisition method where it has the right and the obligation to purchase any
remaining non-controlling interest (so-called put/call arrangements). Under the anticipated acquisition method, the
interests of the non-controlling shareholder are derecognised when Gentrack Group’s liability relating to the purchase of
its shares is recognised. The recognition of the financial liability implies that the interests subject to the purchase are
deemed to have been acquired already. Therefore, the corresponding interests are presented as already owned by
Gentrack Group even though legally they are still non-controlling interests. The initial measurement of the fair value of the
financial liability recognised by Gentrack Group forms part of the consideration for the acquisition.
Gentrack Group has not made any acquisitions during the year ended 30 September 2021 or 2020. For details of
acquisitions made in prior years refer to the 2018 Annual Report.
2.4 GROUP INFORMATION
The financial statements include the following subsidiaries:
ENTITY PRINCIPAL ACTIVITY
COUNTRY OF
INCORPORATION
SHAREHOLDING
2021
SHAREHOLDING
2020
Gentrack Group Australia Pty
Limited
Holding company Australia 100% 100%
Gentrack Pty Limited
Software sales and
support
Australia 100% 100%
Veovo Holdings (Denmark) ApS Holding company Denmark 100% 100%
Veovo A/S (formally Blip Systems
A/S)
Software development
sales and support
Denmark 100% 100%
CA Plus Limited
Software development
sales and support
Malta 100% 100%
Veovo Group Limited Holding company New Zealand 100% 100%
Gentrack Limited
Software development
sales and support
New Zealand 100% 100%
Gentrack Holdings (UK) Limited Holding company United Kingdom 100% 100%
Gentrack UK Limited
Software development
sales and support
United Kingdom 100% 100%
Junifer Systems Limited Dormant United Kingdom 100% 100%
Evolve Parent Limited Holding company United Kingdom 100% 100%
Evolve Analytics Limited Dormant United Kingdom 100% 100%
Gentrack (Singapore) Pte Limited
Software sales and
support
Singapore 100% 100%
Veovo Inc
Software sales and
support
USA 100% 100%
Veovo NZ Limited
Software sales and
support
New Zealand 100% 100%
Veovo UK Limited
Software sales and
support
United Kingdom 100% 100%
Veovo IP Limited Software Development New Zealand 100% 100%
2.5 IMPACT OF STANDARDS ISSUED BUT NOT YET ADOPTED
The International Accounting Standards Board has issued IFRS 17 Insurance Contracts, as well as amendments to
existing international accounting standards. Gentrack Group will adopt IFRS 17 when mandatory and does not expect
IFRS 17 to have any impact on its financial statements.
36 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 20
3. GROUP PERFORMANCE
This section outlines further details of Gentrack Group’s financial performance by building on the information
presented in the statement of comprehensive income.
3.1 OPERATING SEGMENTS
An operating segment is a component of an entity that engages in business activities from which it may earn revenue
and incur expenses, whose operating results are regularly reviewed by the entity’s Chief Operating Decision Maker to
make decisions about resources to be allocated to the segment and assess its performance, and for which discrete
financial information is available. Operating segments are aggregated for disclosure purposes where they have
similar products and services, production processes, customers, distribution methods and regulatory environments.
Gentrack Group currently operates in two business segments, utility billing software and airport
management software. Consistent with prior years, Gentrack Group’s corporate costs are included in the
Utility segment. These segments have been determined based on the reports reviewed by the Board (Chief
Operating Decision Maker) to make strategic decisions.
The assets and liabilities of Gentrack Group are reported to and reviewed by the Chief Operating Decision Maker in
total and are not allocated by business segment. Therefore, operating segment assets and liabilities are not
disclosed
.
2021 UTILITY AIRPORT TOTAL
NZ$000 NZ$000 NZ$000
TIMING OF REVENUE RECOGNITION
Point in time 10,973 1,636 12,609
Over time
77,982 15,132 93,114
Total revenue
88,955 16,768 105,723
Expenditure (79,604) (13,392) (92,996)
Segment contribution (1)
9,351 3,376 12,727
2020 UTILITY AIRPORT TOTAL
NZ$000 NZ$000 NZ$000
TIMING OF REVENUE RECOGNITION
Point in time 7,379 2,018 9,397
Over time 74,397 16,739 91,136
Total revenue 81,776 18,757 100,533
Expenditure (71,565) (16,875) (88,440)
Segment contribution (1) 10,211 1,882 12,093
(1) Segment contribution is defined as Profit before depreciation, amortisation, revaluation of financial liabilities,
impairment of goodwill and intangible assets, financing, and tax.
FINANCIAL STATEMENTS / 37
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 21
3.1 OPERATING SEGMENTS (CONTINUED)
A reconciliation of segment contribution to profit attributable to the shareholders of the company is as follows:
2021 2020
NZ$000 NZ$000
Segment contribution (1)
12,727 12,093
Depreciation and amortisation
(10,864) (12,354)
Revaluation of acquisition related financial liabilities
- 891
Impairment of goodwill and intangible assets
- (34,511)
Net finance income/(expense)
3,701 (386)
Income tax (expense)/benefit
(2,375) 2,561
Profit/(Loss) attributable to the shareholders of the company
3,189 (31,706)
2021 2020
NZ$000 NZ$000
REVENUE BY DOMICILE OF ENTITY
Australia
25,359 22,659
New Zealand
13,467 16,447
United Kingdom
60,302 55,458
Rest of World
6,595 5,969
Total revenue
105,723 100,533
REVENUE BY DOMICILE OF CUSTOMER
Australia
27,509 25,755
New Zealand
8,696 8,456
United Kingdom
57,382 52,746
Rest of World
12,136 13,576
Total revenue
105,723 100,533
In 2021 and 2020, no single customer including their subsidiaries accounted for 10% or more of Gentrack Group’s
revenue.
38 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 22
3.2 OPERATING REVENUE
Gentrack Group recognises revenue from customers when the performance obligation has been
accomplished. A performance obligation is accomplished when the customer has received all the benefits
promised under the performance obligations and payment is generally due within 30 to 60 days from
invoices being raised. The following sections detail the type of revenue recognised within each category.
Revenue recognition of license and project services is recognised based on the stage of completion which
requires judgement to be applied. This process uses estimations of time required to complete the project
and is based on detailed information on hours worked to date, prior experience, and project scheduling
tools. Gentrack Group employs project managers to provide regular information to management on the
progress of all projects. All estimates are reviewed by management prior to revenue recognition
.
ANNUAL FEES
Annual fees include software support and maintenance charged on software licenses, software subscriptions and
managed services. Revenue from annual fees is generally recognised over the period as the benefits are consumed
by the customer.
SUPPORT SERVICES
Support services are post implementation value-add professional services related to ongoing upgrades, minor
software revisions and extended support. Support services revenue is recognised when the service is complete or on
a stage of completion basis.
LICENSES
Revenue from license fees is recognised when the customer can benefit from the licensed software. License fees that
are highly interrelated with project services are recognised based on a stage of completion of the project.
PROJECT SERVICES
Revenue from project services is recognised based on the stage of completion of the project. This is typically in
accordance with the achievement of contract milestones and/or hours expended and forecast hours to complete the
project.
OTHER
Other revenue is primarily revenue from hardware and the recharge of ad-hoc costs that are recharged to customers.
Revenue from hardware sales is recognised when the hardware has been delivered to the customer.
2021 2020
SECTION NZ$000 NZ$000
OPERATING REVENUE:
Annual fees
57,787 60,394
Support services
20,977 20,636
Project services
18,727 13,286
Licenses
2,758 2,177
Other
4,771 2,070
Total operating revenue
105,020 98,563
OTHER INCOME:
Government grants
3.3
703 1,970
Total revenue
105,723 100,533
FINANCIAL STATEMENTS / 39
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 23
3.3 OTHER INCOME
GOVERNMENT
GRANTS
Government grants are recognised at their fair value where there is a reasonable assurance that the grant
will be received, and Gentrack Group will comply with all attached conditions. When a grant relates to an
expense item, it is recognised as income over the period necessary to match the grant on a systematic
basis to the costs that it is intended to compensate.
During 2021, Gentrack Group recognised a total of $0.7 m (2020: $2.0m) of grants from Callaghan Innovation in
New Zealand. This government grant provided a percentage return for eligible Research and Development
conducted by Gentrack Group. At balance date, there are no amounts outstanding in relation to the Callaghan
Grant. Effective from 1 April 2021 for Gentrack Group the Callaghan Grant has been replaced by the Research and
Development Tax Incentive (RDTI) where a tax incentive is provided for eligible Research and Development
conducted by Gentrack Group.
The RDTI and the Research and Development Expenditure Credit (RDEC) in the UK are tax incentives and the
benefit of these tax incentives are applied to Gentrack Group’s income tax payable when the income tax returns for
30 September 2021 are filed.
3.4. EXPENDITURE
The table below provides a detailed breakdown of the total expenditure presented in the statement of
comprehensive income
.
2021 2020
NZ$000 NZ$000
PROFIT / (LOSS) BEFORE TAX INCLUDES THE FOLLOWING SPECIFIC
EXPENSES:
Employee entitlements
70,296 65,780
Administrative costs
3,862 6,721
Third party customer-related costs
5,438 6,450
Advertising and marketing
1,191 898
Consulting and subcontracting
9,353 5,754
Other operating expenses
2,856 2,837
Total expenditure
92,996 88,440
In cluded in the total expenditure above, Gentrack Group has expensed $12.7m in Research and Development
expenditure (2020: $15.7m). This Research and Development expenditure includes payroll costs, employee benefits
and other employee related costs, direct overheads, and other directly attributable costs related to performing
Research and Development activities.
.
40 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 24
3.5 DEPRECIATION AND AMORTISATION
Depreciation on assets is calculated using the straight-line method to allocate the difference between their
original costs and their residual values over their estimated useful lives.
Except for goodwill and brands, intangible assets are amortised on a straight-line basis in the statement of
comprehensive income over their estimated useful lives, from the date that they are available for use.
2021 2020
NZ$000 NZ$000
Depreciation
3,084 3,289
Amortisation 7,780 9,065
Total depreciation and amortisation
10,864 12,354
3.6. NET FINANCE EXPENSES
Finance income comprises interest income and foreign currency gains that are recognised in the statement of
comprehensive income. Interest income is recognised as it accrues, using the effective interest method.
Finance expense comprises interest expense on borrowings, lease liability finance charges, foreign
currency losses and impairment losses recognised on the financial assets (except for trade receivables) that are
recognised in the statement of comprehensive income. All borrowing costs are recognised in the statement of
comprehensive income using the effective interest method.
2021 2020
SECTION NZ$000 NZ$000
FINANCE INCOME
Interest income 26 7
26 7
FINANCE EXPENSE
Interest expense
(203) (383)
Lease liability finance charges
9.1
(814) (931)
Interest paid - NPV discount
- (7)
Foreign exchange gains
4,692 928
3,675 (393)
Net finance income/(expense)
3,701 (386)
FINANCIAL STATEMENTS / 41
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 25
4. CASH, BORROWINGS AND CASH FLOWS
This section outlines further from the statement of cashflows and provides details on the cash and cash
equivalents held in the statement of financial position.
Cash comprises cash at bank and on hand
.
4.1 RECONCILIATION OF NET SURPLUS TO CASH FLOWS
2021 2020
SECTION NZ$000 NZ$000
RECONCILIATION OF OPERATING CASH FLOWS WITH NET PROFIT/(LOSS) AFTER
TAX:
Profit/(Loss) after tax
3,189 (31,706)
ADJUSTMENTS FOR NON-CASH ITEMS
Deferred tax
7.2
(2,590) (4,237)
Impairment provision - Trade receivables
4 1,939
Gain on foreign exchange transactions
(4,692) (928)
Share based payments
3,566 310
Net interest expense
3.6
176 375
Revaluation and interest on financial liability
- (884)
Other non-cash items
- (3)
Depreciation and amortisation
3.5
10,864 12,354
Impairment of goodwill and other intangibles
- 34,511
Non-cash items
10,517 11,731
ADD/(DEDUCT) MOVEMENTS IN OTHER WORKING CAPITAL ITEMS:
(Increase) / Decrease in trade and other receivables
(3,167) 10,850
Increase/(Decrease) in tax payable
1,430 (2,611)
(Decrease)/Increase in GST payable
(1,284) 1,215
Increase in contract liabilities
413 196
Increase in employee entitlements
4,177 965
Increase/(Decrease) in trade payables and accruals
859 (380)
Net working capital movements
2, 428 10,235
Net cash inflow from operating activities 12,945 21,966
4.2 BANK FACILITIES AND BORROWINGS
Gentrack Group has a NZ$20m multi-currency facility with ASB Bank Limited to provide additional funding as
required for acquisitions and general corporate purposes. This facility expires on 28 March 2022, during 2021 the
facility balance was fully repaid leaving $Nil drawn under the facility agreement at 30 September 2021 (2020: $2.5m).
The facility is secured by a general security agreement under which ASB has a security interest in Gentrack Group
assets. Covenants are in place and compliance is reported quarterly.
42 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 26
4.3. CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise cash in hand, deposits held at call with banks, other short-term and
highly liquid investments with original maturities of three months or less.
2021 2020
NZ$000 NZ$000
Bank balances
25,957 19,320
Cash on hand - 1
Total cash and cash equivalents
25,957 19,321
FINANCIAL STATEMENTS / 43
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 27
5. ASSETS AND LIABILITIES
This section outlines further details of Gentrack Group’s financial position by building on information
presented in the statement of financial position.
5.1. TRADE AND OTHER RECEIVABLES
Gentrack Group recognises trade and other receivables initially at fair value and subsequently measured at
amortised cost using the effective interest method, less provision for impairment. An impairment provision
for trade receivables consists of the expected credit loss in accordance with NZ IFRS 9 and a specific
provision.
A specific provision is established when there is objective evidence that Gentrack Group will not be able to
collect all amounts due according to the original terms of the receivables. The carrying amount of an asset
is reduced using provision accounts, and the amount of the loss is recognised in the statement of
comprehensive income. When a receivable is uncollectible, it is written off against the specific impairment
provision account. Subsequent recoveries of amounts previously written off are credited against the statement of
comprehensive income.
2021 2020
NZ$000 NZ$000
Trade receivables
18,422 15,084
Impairment provision - Expected credit loss
(334) (390)
Impairment provision - Specific provision
(2,945) (3,460)
Provision for volume discounts
(104) (131)
Contract assets
4,865 5,683
Sundry receivables and prepayments
1,842 2,165
Total trade and other receivables
21,746 18,951
MOVEMENT IN TRADE RECEIVABLES IMPAIRMENT PROVISION
2021 2020
NZ$000 NZ$000
Opening balance
3,850 2,868
Increase in impairment provision
1,563 2,618
Write back in impairment provision
(2,089) (566)
Effect of movement in foreign exchange
(21) 13
Bad debt written off
(24) (1,083)
Total trade receivables impairment provision
3,279 3,850
44 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 28
5.1 TRADE AND OTHER RECEIVABLES (CONTINUED)
The expected credit loss provision for trade receivables has been measured using the same techniques as the prior
year, determined as follows.
2021
CURRENT
1-60 DAYS
PAST DUE
61-120
DAYS PAST
DUE
121-180
DAYS PAST
DUE
OVER 180
DAYS PAST
DUE
TOTAL
NZ$000 NZ$000 NZ$000 NZ$000 NZ$000 NZ$000
Gross carrying amount 13,318 2,260 591 327 1,926 18,422
Baseline 34 17 9 8 96 164
Aging and Customer
duration
1 - 6 10 97 114
Country, Customer and
Market
26 6 3 2 19 56
Total expected credit loss
rate
0.45% 1.02% 3.02% 6.25% 11.05% 1.81%
Expected credit loss
allowance
60 23 18 20 213 334
2020 CURRENT
1-60 DAYS
PAST DUE
61-120
DAYS PAST
DUE
121-180
DAYS PAST
DUE
OVER 180
DAYS PAST
DUE
TOTAL
NZ$000 NZ$000 NZ$000 NZ$000 NZ$000 NZ$000
Gross carrying amount 8,513 3,214 356 806 2,195 15,084
Baseline 21 21 5 20 106 173
Aging and Customer
duration
1 6 3 39 112 161
Country, Customer and
Market
16 8 2 6 24 56
Total expected credit loss
rate
0.45% 1.09% 2.84% 8.08% 11.03% 2.59%
Expected credit loss
allowance
38 35 10 65 242 390
5.2 GOODWILL
Goodwill represents the difference between the cost of acquisition and the fair value of the net identifiable
assets acquired. Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to
cash-generating units (CGU) and is not amortised but is tested annually for impairment.
2021 2020
NZ$000 NZ$000
Opening balance
106,599 134,434
Goodwill impairment
- (28,040)
Exchange rate differences
167 205
Net book value
106,766 106,599
Goodwill allocated to Utilities
103,866 103,699
Goodwill allocated to Veovo 2,900 2,900
Net book value
106,766 106,599
During the year due to the further alignment of the Airport 20/20 and Blip Systems CGU, these CGU’s have been
combined to form the Veovo CGU. With further alignment, it is no longer possible to meaningfully separate the
cashflows of these CGU’s and therefore are now reported as a single CGU.
FINANCIAL STATEMENTS / 45
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 29
5.3 IMPAIRMENT TESTING
IMPAIRMENT
TESTING OF GOODWILL AND OTHER ASSETS
At each reporting date, Gentrack Group assesses whether there is any indication that an asset may be
impaired. Where an indicator of impairment exists, Gentrack Group makes a formal estimate of the
recoverable amount. Where the carrying value of an asset exceeds its recoverable amount, the asset is
considered impaired and is written down to its recoverable amount. Recoverable amount is the greater of
fair value less costs to sell or the asset’s value in use. For the purposes of assessing impairment, assets are grouped at
the lowest levels for which there are separately identifiable cash flows (cash-generating units). Non-financial assets
other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at each
reporting date.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax
discount rate that reflects the current market assessments and the time value of money and the risks specific to the
asset. Value in use is determined by discounting the future cash flows generated by each CGU. Cash flows were
projected based on five-year business plans. The Weighted Average Cost of Capital (WACC) is based on CAPM
methodology using
market specific inputs. The WACC for each CGU is reviewed at least annually. The key
assumptions are detailed in the table below.
Gentrack Group tests annually whether goodwill has suffered any impairment or more often as required, in
accordance with the accounting policy stated above. The recoverable amounts of cash-generating units have
been determined based on value in use calculations. Preparing five-year forecasts in a COVID-19
environment has been a challenging task due to the uncertainty of the future. In preparing the five-year
forecasts, management has reviewed the assumptions and weighed up the information available at the time to ensure
the forecasts are appropriate given the CGU’s position and the prevailing market conditions.
These calculations require the use of assumptions, the details of these assumptions are presented below and for both
CGU’s a Terminal Growth Rate of 1.85% has been applied.
CASH GENERATING UNIT
2021 REVENUE
GROWTH
2022 - 2026
WACC
2021
2020 REVENUE
GROWTH
2021 - 2025
WACC
2020
Utilities 5.1% CAGR 9.6% 4% CAGR 9.8%
Veovo 10.6% CAGR 10.7% 5% CAGR 10.1%
IMPAIRMENT TESTING RESULTS
The calculations confirmed there was no impairment of goodwill during the year for the Utilities or Veovo CGU’s.
Management believes that any reasonable possible change in the key assumptions for either CGU would not cause
the carrying amount to exceed the recoverable amount.
Changes in key assumptions were considered as sensitivities. These are summarised in the table below.
CASH GENERATING UNIT
RECOVERABLE
AMOUNT
EBITDA
+5%
EBITDA
-5%
WACC
+1%
WACC
-1%
Utilities 199,784 206,873 189,310 176,189 228,849
Veovo 9,724 11,058 9,218 8,641 12,037
46 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 30
5.4 INTANGIBLE ASSETS
CAPITALISED DEVELOPMENT
Costs that are directly associated with the development of software are recognised as intangible assets
where the following criteria are met:
• it is technically feasible to complete the software product so that it will be available for use.
• management intends to complete the software product and use or sell it.
• there is an ability to use or sell the software product.
• it can be demonstrated how the software product will generate probable future economic benefits.
• adequate technical, financial, and other resources to complete the development and to use or sell the software
product are available; and
• the expenditure attributable to the software product during its development can be reliably measured.
Software development costs that meet the above criteria are capitalised. Other development expenditure that does not
meet the above criteria is recognised as an expense as incurred. Development costs previously recognised as expenses
are not recognised as assets in a subsequent period. Software development costs recognised as assets are amortised
over their estimated useful lives.
BRANDS
Brands are considered to have an indefinite useful life and are held at cost and are not amortised but are subject to an
annual impairment test consistent with the methodology outlined for goodwill above.
OTHER
INTANGIBLE ASSETS
Other intangible assets consist of internal use software, acquired source code, trade-marks, and customer relationships.
They have finite useful lives and are measured at cost less accumulated amortisation and accumulated impairment
losses.
FINANCIAL STATEMENTS / 47
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 31
5.4 INTANGIBLE ASSETS (CONTINUED)
AMORTISATION
Except for goodwill and brands, intangible assets are amortised on a straight-line basis in the statement of
comprehensive income over their estimated useful lives, from the date that they are available for use.
The estimated useful lives for the current and comparative periods are as follows:
• Acquired source code 10 years
• Internal use software 3 years
• Customer relationships 10 years
• Trademarks 4 years
• Capitalised development 5 years
Amortisation methods, useful lives and residual values are reviewed at each financial year end and adjusted if
appropriate.
2021
SOFTWARE
CUSTOMER
RELATIONSHIPS
BRAND
NAMES
TRADEMARKS
CAPITALISED
DEVELOPMENT
TOTAL
NZ$000 NZ$000 NZ$000 NZ$000 NZ$000 NZ$000
Opening balance 25,046 12,888 5,024 454 2,016 45,428
Amortisation (4,666) (2,405) - (165) (544) (7,780)
Movement in foreign
exchange
33 18 - - (1) 50
Closing net book
value
20,413 10,501 5,024 289 1,471 37,698
Cost 45,025 24,169 5,024 841 2,729 77,788
Accumulated
amortisation
(24,612) (13,668) - (552) (1,258) (40,090)
Net book value
20,413 10,501 5,024 289 1,471 37,698
2020
SOFTWARE
CUSTOMER
RELATIONSHIPS
BRAND
NAMES
TRADEMARKS
CAPITALISED
DEVELOPMENT
TOTAL
NZ$000 NZ$000 NZ$000 NZ$000 NZ$000 NZ$000
Opening balance 31,413 15,718 5,024 621 7,706 60,482
Additions - - - - 331 331
Amortisation (4,861) (2,473) - (169) (1,562) (9,065)
Impairment (1,616) (390) - - (4,464) (6,470)
Movement in foreign
exchange
110 33 - 2 5 150
Closing net book
value
25,046 12,888 5,024 454 2,016 45,428
Cost 44,945 24,128 5,024 839 2,726 77,662
Accumulated
amortisation
(19,899) (11,240) - (385) (710) (32,234)
Net book value 25,046 12,888 5,024 454 2,016 45,428
48 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 32
5.5 PROPERTY PLANT AND EQUIPMENT
In the statement of financial position property, plant and equipment is stated at historical cost less
depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.
Depreciation on assets is calculated using the straight-line method to allocate the difference between their
original costs and their residual values over their estimated useful lives, as follows:
• Furniture & equipment 7 years
• Computer equipment 3 to 7 years
• Leasehold improvements Term of lease
The assets’ residual values and useful lives are reviewed and adjusted if appropriate at each balance date.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is
greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with carrying amounts and are recognised in
the statement of comprehensive income.
2021
FURNITURE &
EQUIPMENT
COMPUTER
EQUIPMENT
LEASEHOLD
IMPROVEMENTS
TOTAL
NZ$000 NZ$000 NZ$000 NZ$000
Opening balance 788 522 1,453 2,763
Additions
28 631 4 663
Depreciation
(170) (396) (171) (737)
Movement in foreign
exchange
(4) (2) - (6)
Net book value
642 755 1,286 2,683
Cost
2,086 4,371 2,088 8,545
Accumulated depreciation (1,444) (3,616) (802) (5,862)
Net book value 642 755 1,286 2,683
2020
FURNITURE &
EQUIPMENT
COMPUTER
EQUIPMENT
LEASEHOLD
IMPROVEMENTS
TOTAL
NZ$000 NZ$000 NZ$000 NZ$000
Opening balance
969 849 1,635 3,453
Additions
22 300 2 324
Depreciation
(197) (556) (185) (938)
Disposals
- (16) - (16)
Movement in foreign
exchange
(6) (55) 1 (60)
Net book value 788 522 1,453 2,763
Cost
2,097 3,918 2,088 8,103
Accumulated depreciation (1,309) (3,396) (635) (5,340)
Net book value 788 522 1,453 2,763
FINANCIAL STATEMENTS / 49
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 33
5.6 TRADE PAYABLES AND ACCRUALS
Gentrack Group recognises trade and other payables initially at fair value and subsequently measured at
amortised cost using the effective interest method. They represent liabilities for goods and services
provided prior to the end of the financial year that are unpaid. The amounts are unsecured, non-interest
bearing and are usually paid within 45 days of recognition.
2021 2020
NZ$000 NZ$000
Trade creditors
1,929 1,803
Sundry accruals 2,584 2,102
Total trade payables and accruals
4,513 3,905
5.7 EMPLOYEE ENTITLEMENTS
Liabilities for salaries and wages, including non-monetary benefits, long service leave, and annual leave are
recognised in employee benefits in respect of employees’ services up to the reporting date. They are
measured at the amounts expected to be paid when the liabilities are settled. Cost for non-accumulating
sick leave is recognised when the leave is taken and measured at the rates paid or payable.
2021 2020
NZ$000 NZ$000
CURRENT
Long service leave
448 611
Other short-term employee benefits
9,087 4,941
9,535 5,552
NON-CURRENT
Long service leave
539 428
Total employee entitlements
10,074 5,980
5.8 INVENTORY
Inventories are stated at the lower of cost and net realisable value. Cost is calculated using a weighted average
method and includes expenditure incurred to purchase the inventory and transport it to its current location. Net
realisable value is the estimated selling price of the inventory in the ordinary course of business less costs
necessary to make the sale. The cost of inventories consumed during the year are recognised as an
expense and included in expenditure in the statement of comprehensive income.
50 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 34
6. CAPITAL STRUCTURE
This section outlines Gentrack Group’s capital structure and details of share-based employee
incentives which have an impact on Gentrack Group’s equity.
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares
and share options are recognised as a deduction from equity, net of any tax effects. Where any Gentrack
Group company purchases the Company’s equity share capital (treasury shares), the consideration paid is
deducted from equity attributable to the Company’s equity holders until the shares are cancelled or
transferred outside Gentrack Group.
Ordinary shares are fully paid and have no par value. The holders of ordinary shares are entitled to receive dividends as
declared from time to time and are entitled to one vote per share at meetings of the Company and rank equally with
regard to the Company’s residual assets.
6.1 CAPITAL MANAGEMENT
The capital structure of Gentrack Group consists of equity raised by the issue of ordinary shares in the parent
company.
Gentrack Group manages its capital to ensure that companies in the Group can continue as going concerns. Gentrack
Group is not subject to any externally imposed capital requirements.
SHARES ISSUED SHARE CAPITAL
2021 2020 2021 2020
000 000 NZ$000 NZ$000
Ordinary Shares 98,645 98,645 191,229 191,229
Issue of new ordinary shares 302 - 470 -
98,947 98,645 191,699 191,229
During 2021 Performance Rights of 274,105 in relation to Long Term Incentive Schemes vested, resulting in the same
number of new shares being issued. Also 28,389 shares were issued as part payment of Gentrack Group Directors
fees.
6.2 SHARE BASED PAYMENTS
Gentrack Group operates equity settled, share-based payments schemes under which it receives services
from employees, as consideration for equity instruments of Gentrack Group. A valuation is completed for
each scheme at the grant date to estimate the fair value of the performance rights granted. Management
also makes estimates about the number of performance rights that are expected to vest which determines
the expense recorded in the statement of comprehensive income.
The fair value of the performance rights is determined at the grant date using the Black Scholes valuation method, the
key input into the valuation model is the grant date share price. The fair value of the performance rights is
recorded as an expense in the statement of comprehensive income over the vesting period, based on
Gentrack Group’s estimate of the number of performance rights that will vest, with a corresponding entry to
the share-based payment reserve within equity. During the year ended 30 September 2021, $3.6m has been
recognised in the statement of comprehensive income (2020: $0.3m).
During the year ended 30 September 2021, two new equity settled share-based payment schemes were introduced
and additional participants were granted performance rights under the existing scheme. The existing scheme has
been renamed as the Senior Leadership Long Term Incentive. The two new equity settled share-based payment
schemes introduced during the year are the Gentrack Long Term Incentive Scheme and the CEO Long Term
Incentive Scheme.
SENIOR
LEADERSHIP LONG TERM INCENTIVE SCHEME
During the year the Gentrack Group Board approved the sixth annual grant of performance rights in the Senior
Leadership Long Term Incentive Scheme, this scheme was first introduced in 2016 for selected key personnel. The
scheme is intended to attract and reward key personnel to focus on long-term performance. The number of
performance rights allocated is based on a percentage of salary or other such percentage and are calculated with
FINANCIAL STATEMENTS / 51
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 35
6.2 SHARE BASED PAYMENTS (CONTINUED)
reference to the 10-trading day volume weighted average price (VWAP) of shares traded on the NZX based on dates
indicated in the issue documentation.
The number of performance rights subject to the Earnings Per Share (EPS) hurdle that will vest after three years
depends on achievement of the EPS performance hurdle. The performance hurdle is that 50% of the EPS
Performance Rights will vest if EPS Compounding Annual Growth Rate (CAGR) of Gentrack Group over the three
financial years is 7%, with the number of performance rights that vest increasing on a linear basis to 100% if EPS
CAGR of 12% is achieved.
During 2021, 24,105 Performance Rights in the Senior Leadership Long Term Incentive vested with a weighted
average vesting date share price of $2.10 per share. Below are the
details of the outstanding performance rights in the Senior Leadership Long Term Incentive Scheme:
GRANT DATE EXPIRY DATE
TOTAL VALUE
OF GRANTED
PERFORMANCE
RIGHTS
PERFORMANCE
RIGHTS
GRANTED
2021
NZ$000 000
EPS SCHEMES 2018-2021
1 October 2018 30 November 2021 310 65
1 October 2019 30 November 2022 351 160
1 April 2020 1 April 2023 1,023 769
1 October 2020 1 April 2022 973 666
1 October 2020 30 November 2023 996 682
Total Senior Leadership LTI Schemes 3,653 2,342
GRANT DATE
EXPIRY DATE
TOTAL VALUE
OF GRANTED
PERFORMANCE
RIGHTS
PERFORMANCE
RIGHTS
GRANTED
2020
NZ$000 000
EPS SCHEMES 2017-2020
1 October 2017 30 November 2020 318 55
1 October 2018 30 November 2021 411 86
1 October 2019 30 November 2022 1,055 217
1 April 2020 1 April 2023 1,364 1,026
1 August 2020 1 August 2021 28 24
Total Senior Leadership LTI Schemes 3,176 1,408
GENTRACK LONG TERM INCENTIVE SCHEME
On 24 December 2020 Gentrack Group announced the establishment of a new Long Term Incentive Scheme
(Gentrack Long Term Incentive Scheme). The Gentrack Long Term Incentive Scheme has been introduced to:
- Assist with the retention of eligible employees
- Significantly increase the number of Gentrack Group employees that have a stake in Gentrack Group
- Give eligible employees a share in Gentrack Group’s future performance
The participants of the Gentrack Long Term Incentive Scheme are offered Performance Rights for nil consideration,
which on vesting will entitle them to receive one ordinary share in Gentrack Group. These Performance Rights will
vest subject to the participants continuing to be employed by Gentrack Group at the end of the vesting period which
commences 1 October 2022.
Gentrack Group issued 592,352 Performance Rights to employees under the Gentrack Long Term Incentive Scheme
during 2021. 535,819 Performance Rights are outstanding at 30 September 2021 with a grant date fair value of $0.8m
and an expiry date of 1 October 2022
.
52 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 36
6.2 SHARE BASED PAYMENTS (CONTINUED)
CEO
LONG TERM INCENTIVE SCHEME
Gary Miles was appointed to the role of Managing Director and Chief Executive Officer (CEO) from 1 October 2020
and included in the remuneration package are Performance Rights granted for nil consideration.
During 2021, a total of 1,248,604 Performance Rights were issued under the CEO Long Term Incentive Scheme,
which 500,000 were an initial grant with 250,000 of these vesting immediately and the remaining 250,000 to vest on
the one-year anniversary of starting employment with Gentrack Group. There are no vesting conditions or
performance hurdles in regard to the initial grant. The remaining 748,604 Performance Rights granted are an initial
annual grant and will vest at the end of a 13-month performance period, vesting subject to performance hurdles set
by the Board of Directors and is aligned with initial business transformation and the financial performance during
2021.
During 2021 a total of 250,000 Performance Rights have vested with a weighted average share price on the vesting
date of $1.57 per share. 998,604 Performance Rights remain outstanding at 30 September 2021, with a total grant
date fair value of $1.54m and an expiry date of 31 October 2021.
PERFORMANCE
RIGHTS MOVEMENTS
Below is a summary of all performance rights, granted, exercised and forfeited across all the equity settled share-
based payments schemes operated by Gentrack Group during 2021:
2021 2020
GRANT DATE
AVERAGE
EXERCISE PRICE
PER
PERFORMANCE
RIGHT
NUMBER OF
PERFORMANCE
RIGHTS
AVERAGE
EXERCISE PRICE
PER
PERFORMANCE
RIGHT
NUMBER OF
PERFORMANCE
RIGHTS
000 000
As at 1 October $2.25 1,408 $4.49 268
Granted during the year $1.49 3,253 $1.93 1,267
Exercised during the year
$1.51 (274) - -
Forfeited during the year
$2.08 (511) $3.78 (127)
As at 30 September $1.54 3,876 $2.25 1,408
FINANCIAL STATEMENTS / 53
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 37
6.3 DIVIDENDS
Details of the dividends paid during the year ended 30 September 2021 are provided below:
CENTS PER SHARE DIVIDENDS PAID
2021 2020 2021 2020
NZ$000 NZ$000
Final dividend paid - 3.0c - 3,004
Interim dividend paid - - -
- 3.0c - 3,004
6.4 EARNINGS PER SHARE
Gentrack Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS
is calculated by dividing the net profit attributable to ordinary shareholders of the Company by the weighted
average number of ordinary shares on issue during the year, excluding shares purchased and held as
treasury shares.
Diluted EPS is determined by adjusting the net profit attributable to ordinary shareholders and the weighted average
number of ordinary shares on issue for the effects of the dilutive impact of potential ordinary shares, which comprise
performance share rights granted to employees.
Potential ordinary shares are treated as dilutive when, and only when, their conversion to ordinary shares would decrease
EPS or increase the profit per share.
2021 2020
Profit/(Loss) attributable to the shareholders of the company
3,189 (31,706)
Profit/(Loss) attributable to the shareholders of the company
adjusted for the effect of dilution
3,189 (31,706)
Basic weighted average number of ordinary shares issued
98,761 98,645
Shares deemed to be issued for no consideration in respect
of share-based payments
3,8 76 1,408
Weighted average number of shares used in diluted earnings
per share
102,637 100,053
Basic earnings per share
$0.03 ($0.32)
Diluted earnings per share
$0.03 ($0.32)
54 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 38
7. TAX
7.1 INCOME TAX EXPENSE
In the statement of comprehensive income, the income tax expense comprises current and deferred tax.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or
substantially enacted at the reporting date, and any adjustment to tax payable in respect of previous years.
Current tax payable also includes any tax liability arising from the declaration of dividends
.
2021 2020
NZ$000 NZ$000
INCOME TAX EXPENSE COMPRISES:
Current tax expense
4,965 1,676
Deferred tax expense
(2,590) (4,237)
Tax expense/(benefit)
2,375 (2,561)
RECONCILIATION OF INCOME TAX EXPENSE
The relationship between the expected income tax expense based on the domestic effective tax rate of Gentrack
Group at 28% (2020: 28%) and the reported tax expense in the statement of comprehensive income can be
reconciled as follows
:
2021 2020
NZ$000 NZ$000
Profit/(Loss) before tax 5,564 (34,267)
Taxable income
5,564 (34,267)
Domestic tax rate for Gentrack Group 28% 28%
Expected tax expense/(benefit)
1,558 (9,595)
Non-deductible expense
1,345 8,350
Foreign subsidiary company tax
(40) 1,009
Prior period adjustments
(488) (2,325)
Actual tax expense/(benefit)
2,375 (2,561)
As at 30 September 2021 Gentrack Group has $9.4m (2020: $8.7m) of imputation credits available for use in
subsequent reporting periods.
7.2 DEFERRED TAX ASSETS AND LIABILITIES
Deferred tax is recognised, using the liability method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial statements.
Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially
enacted by the reporting date and are expected to apply when the related deferred income tax asset is
realised, or the deferred income tax liability is settled.
Deferred income tax is provided on temporary differences arising on investments in subsidiaries, except for deferred
income tax liabilities where the timing of the reversal of the temporary difference is controlled by Gentrack Group
and it is probable that the temporary difference will not reverse in the foreseeable future.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax
assets against current tax liabilities and when the deferred income tax assets and liabilities relate to income tax levied
by the same taxation authority on either the same taxable entity or different entities where there is an intention to
settle the balance on a net basis.
FINANCIAL STATEMENTS / 55
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 39
7.2 DEFERRED TAX ASSETS AND LIABILITIES (CONTINUED)
Additional income tax expenses that arise from the distribution of cash dividends are recognised while the liability to
pay the related dividend is recognised. Gentrack Group does not distribute non-cash assets as dividends to its
shareholders.
Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable
that the related benefits will be realised.
A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available
against which temporary differences can be utilised. Management applies judgement when reviewing
current business plans and forecasts to ascertain the likelihood of future taxable profits.
The movement in temporary differences has been recognised in the statement of comprehensive income. Deferred tax
has been recognised at a rate at which they are expected to be realised: 28% for New Zealand entities, 30% for Australian
entities, 19% for UK entities, 22% for Denmark entities and 35% for Malta entities.
Movement in temporary timing differences during the year:
2021
OPENING
BALANCE
TEMPORARY
MOVEMENT
RECOGNISED
CURRENCY
TRANSLATION
CLOSING
BALANCE
NZ$000 NZ$000 NZ$000 NZ$000
Trade and other receivables (84) 66 4 (14)
Intangible assets (4,913) 1,631 (9) (3,291)
Contract liabilities
871 140 (28) 983
Provisions
1,738 973 (35) 2,676
Losses carried forward
2,016 (203) (86) 1,727
Other
24 (17) (2) 5
Net deferred tax
(348) 2,590 (156) 2,086
2020
OPENING
BALANCE
TEMPORARY
MOVEMENT
RECOGNISED
CURRENCY
TRANSLATION
CLOSING
BALANCE
NZ$000 NZ$000 NZ$000 NZ$000
Trade and other receivables (68) (15) (1) (84)
Intangible assets (7,196) 2,303 (20) (4,913)
Contract liabilities 661 202 8 871
Provisions 1,056 673 9 1,738
Losses carried forward 1,076 944 (4) 2,016
Other (97) 130 (9) 24
Net deferred tax (4,568) 4,237 (17) (348)
56 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 40
8. FINANCIAL RISK MANAGEMENT
Gentrack Group is exposed to credit risk, liquidity risk and market risks which include foreign currency risk,
commodity price risk and interest risk. This section details of each of these financial risks and how they are
managed by Gentrack Group.
The Board of Directors has overall responsibility for the establishment and oversight of Gentrack Group’s
risk management framework. Gentrack Group’s risk management policies are established to identify and
analyse (amongst other risks) the financial risks faced by Gentrack Group, to set appropriate risk limits and
controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed
regularly to reflect changes in market conditions and Gentrack Group’s activities.
8.1 CREDIT RISK
Credit risk is the risk of financial loss to Gentrack Group if a customer or counter party to a financial instrument fails to
meet its contractual obligations, and it arises principally from Gentrack Group’s trade receivables from customers in the
normal course of business.
Gentrack Group’s exposure to credit risk is influenced mainly by the individual characteristics of each
customer. The credit worthiness of a customer or counter party is determined by several qualitative and
quantitative factors. Qualitative factors include external credit ratings (where available), payment history and
strategic importance of customer or counter party. Quantitative factors include transaction size, net assets of
customer or counter party, and ratio analysis on liquidity, cash flow and profitability.
In relation to trade receivables, it is Gentrack Group’s policy that all customers who wish to trade on terms are subject to
credit verification on an ongoing basis with the intention of minimising bad debts. The nature of Gentrack Group’s trade
receivables is represented by regular turnover of product and billing of customers based on the contractual payment
terms.
Gentrack Group has an impairment provision that represents its estimate of future incurred losses in respect of trade and
other receivables. The impairment provision consists of the expected credit loss provision in accordance with NZ IFRS
9 and a specific doubtful debt provision used where there is objective evidence that indicates a trade receivable is
impaired.
The carrying amount of
Gentrack Group’s financial assets represents the maximum credit exposure as summarised in
the table below:
2021 2020
GROSS
IMPAIRMENT
PROVISION
GROSS
IMPAIRMENT
PROVISION
NZ$000 NZ$000 NZ$000 NZ$000
Current 13,318 (348) 8,513 (38)
Past due 1-60 days 2,260 (454) 3,214 (918)
Past due 61-120 days
591 (261) 356 (178)
Past due 121-180 days
327 (315) 806 (600)
Past due over 180 days
1,926 (1,901) 2,195 (2,116)
18,422 (3,279) 15,084 (3,850)
Gentrack Group’s trade receivables are not exposed to any significant credit exposure to any single counterparty or
group of counterparties having similar characteristics. Trade receivables consist of several customers in various
geographical areas. Based on historic information about customer default rates, management considers the credit
quality of trade receivables that are not past due or impaired to be good.
As at 30 September 2021 there are no significant concentrations of credit risk for financial assets designated as at
amortised cost or at fair value. The carrying amount reflects Gentrack Group’s maximum exposure to credit risk for
these financial assets.
Judgement has been applied to the recovery of all trade receivables, with management confirming that all carrying
amounts are deemed to be recoverable and not impaired.
The credit risk for cash and cash equivalents is considered negligible since the counterparties are highly reputable
financial intuitions with high quality external credit ratings.
FINANCIAL STATEMENTS / 57
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 41
8.2 MARKET RISK
Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates, will affect
Gentrack Group’s income or the value of its holdings of financial instruments. The objective of market risk
management is to manage and control market risk exposures within acceptable parameters, while optimising the
return on risk.
FOREIGN CURRENCY RISK
Gentrack Group is exposed to currency risk on transactions that are denominated in a currency other than the
functional currency of Gentrack Group (NZD), primarily the following currencies Australian Dollar (AUD), Pound
Sterling (GBP), EURO (EUR), US Dollar (USD), and Danish Kroner (DKK).
Gentrack Group’s exposure to foreign currency risk at the reporting date was as follows (all amounts are
denominated in New Zealand Dollars):
AUD GBP EUR USD DKK
2021
NZ$000 NZ$000 NZ$000 NZ$000 NZ$000
Cash and cash equivalents 10,756 8,002 496 855 183
Trade and other receivables 4,503 10,074 1,493 874 1,915
Trade and other payables
(132) (2,608) (72) (354) (562)
Bank loans
- - - - -
Net exposure
15,127 15,468 1,917 1,375 1,536
2020
Cash and cash equivalents 5,634 10,675 70 1,029 96
Trade and other receivables 4,790 8,874 1,056 1,369 1,521
Trade and other payables (218) (1,479) (507) (1,768) (103)
Bank loans - (2,536) - - -
Net exposure 10,206 15,534 619 630 1,514
The following table summarises the sensitivity of profit or loss and equity with regards to Gentrack Group’s financial
assets and financial liabilities affected by AUD/NZD exchange rate, the GBP/NZD exchange rate, the EUR/NZD
exchange rate, the USD/NZD exchange rate, and the DKK/NZD exchange rate with all other aspects being equal. It
assumes a +/-10% change in the NZD to the currency exchange rate for the year ended 30 September 2021 (2020:
10%). These +/-10% sensitivities have been determined based on the average market volatility in exchange rates in
the preceding 12 months.
PROFIT/EQUITY
AUD GBP EUR USD DKK
NZ$000 NZ$000 NZ$000 NZ$000 NZ$000
2021
10% strengthening in NZD (1,375) (1,406) (174) (125) (140)
10% weakening in NZD
1,681 1,719 213 153 171
2020
10% strengthening in NZD (928) (1,412) (56) (57) (138)
10% weakening in NZD 1,134 1,726 69 70 168
Gentrack Group’s exposure to foreign exchange rates varies during the year depending on the volume of foreign
currency transactions. Even so, the analysis above is representative of Gentrack Group’s exposure to market risk.
58 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 42
8.3 LIQUIDITY RISK
Liquidity risk is the risk that Gentrack Group will not be able to meet its financial obligations as and when they become due
and payable. Gentrack Group’s approach to managing liquidity risk is to ensure, as far as possible, that it will always have
sufficient liquidity to meet its liabilities when they become due and payable, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to Gentrack Group’s reputation.
Gentrack Group has sufficient cash to meet its requirements in the foreseeable future.
The following table details Gentrack Group’s contractual maturities of financial liabilities, as at the reporting date:
ON
DEMAND
LESS THAN
3 MONTHS
3 TO 12
MONTHS
1 TO 5
YEARS
>5 YEARS TOTAL
NZ$000 NZ$000 NZ$000 NZ$000 NZ$000 NZ$000
2021
Bank loan - - - - - -
Trade payables
- 1,929 - - - 1,929
Financial liabilities
- - - - - -
- 1,929 - - - 1,929
2020
Bank loan - - 2,536 - - 2,536
Trade payables - 1,803 - - - 1,803
Financial liabilities - - - - - -
- 1,803 2,536 - - 4,339
8.4 INTEREST RATE RISK
Gentrack Group’s interest rate risk primarily arises from short term bank borrowing, cash, and advances from related
parties. Borrowings and deposits at variable interest rates expose Gentrack Group to cash flow interest rate risk.
Borrowings and deposits at fixed rates expose Gentrack Group to fair value interest rate risk.
The following tables detail the interest rate repricing profile and current interest rate of the interest-bearing financial
assets and liabilities.
EFFECTIVE
INTEREST
RATE
FLOATING
FIXED UP
TO 3
MONTHS
FIXED UP
TO 6
MONTHS
FIXED UP
TO 5 YEARS
TOTAL
NZ$000 NZ$000 NZ$000 NZ$000 NZ$000 NZ$000
ASSETS
Bank balances - 25,957 - - - 25,957
Total exposure 25,957 - - - 25,957
EFFECTIVE
INTEREST
RATE +1%
EFFECTIVE
INTEREST
RATE -1%
NZ$000 NZ$000
Bank balances
262 (262)
Total exposure 262 (262)
FINANCIAL STATEMENTS / 59
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 43
8.5 FINANCIAL INSTRUMENTS
Gentrack Group’s financial assets are measured at amortised cost. Gentrack Group’s financial assets are
held within a business model whose objective is to hold the financial asset to collect contractual cash flows
and the financial asset gives rise to contractual cash flows on specified dates that are payments of principal
and interest on the principal outstanding.
Gentrack Group’s financial liabilities are measured at amortised cost except for contingent consideration which is
required to be measured at fair value through profit and loss.
Gentrack Group’s financial assets and liabilities by category are summarised as follows:
CASH AND CASH EQUIVALENTS
Cash and cash equivalents comprise of cash at bank and on hand and the carrying amount is equivalent to fair value.
TRADE RECEIVABLES
These assets are short term in nature and are reviewed for impairment; the carrying value approximates their fair
value.
TRADE PAYABLES
These liabilities are mainly short term in nature with the carrying value approximating the fair value.
LOANS AND BORROWINGS
Loans and borrowings have a floating interest rate. Fair value is estimated using the discounted cash flow model
based on current market interest rate for a similar product; the carrying value approximates their fair value.
FAIR VALUES
Gentrack Group’s financial instruments that are measured after initial recognition at fair values are grouped into levels
based on the degree to which their fair value is observable:
• Level 1 – fair value measurements derived from quoted prices in active markets for identical assets.
• Level 2 – fair value measurements derived from inputs other than quoted prices included within level 1 that are
observable for the asset or liability, either directly or indirectly.
• Level 3 – fair value measurements derived from valuation techniques that include inputs for the asset or liability
which are not based on observable market data.
There have been no transfers between levels or changes in the valuation methods used to determine the fair value of
Gentrack Group’s financial instruments during the period. As at 30 September 2021 Gentrack Group has no of level 3
financial instruments (2020: $Nil).
FINANCIAL INSTRUMENTS BY CATEGORY
2021 2020
NZ$000 NZ$000
FINANCIAL ASSETS MEASURED AT AMORTISED COST
Cash and cash equivalents
25,957 19,321
Trade and other receivables
21,746 18,951
47,703 38,272
FINANCIAL LIABILITIES MEASURED AT AMORTISED COST
Loans and borrowings
- (2,536)
Trade payables
(1,929) (1,803)
FINANCIAL LIABILITIES MEASURED AT FAIR VALUE
Financial Liabilities - -
(1,929) (4,339)
60 / FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 44
9. OTHER INFORMATION
9.1 LEASE ASSETS AND LEASE LIABILITIES
RECOGNITION
AND MEASUREMENT OF GENTRACK GROUP LEASING ACTIVITIES
Gentrack Group predominantly leases property for fixed periods of 1-12 years and may have extension
options. These extension options are usually at the discretion of Gentrack Group and are included in the
measurement of the lease asset if management intends to exercise the extension. Lease terms are
negotiated on an individual basis and contain a variety of terms and conditions. However, these lease
agreements do not impose any covenants.
Leases are recognised as a right of use asset (lease asset) and a corresponding lease liability at the date at which the
leased asset is available for use. Each lease payment is allocated between the liability and finance cost. The finance
cost is charged to profit or loss over the lease period. The lease asset is depreciated over the shorter of the asset’s
useful life and the lease term on a straight-line basis.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the
net present value of the following lease payments:
• fixed payments (including in-substance fixed payments), less any lease incentives receivable
• variable lease payments that are based on an index or a rate
• amounts expected to be payable by the lessee under residual value guarantees
• the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and
• payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.
The lease payments are discounted using the lessee’s incremental borrowing rate, being the rate that the lessee
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.
Lease assets are measured at cost comprising the following:
• the amount of the initial measurement of lease liability
• any lease payments made at or before the commencement date less any lease incentives received
• any initial direct costs, and
• restoration costs.
Key movements related to the lease assets and lease liabilities are presented below:
LEASE
ASSETS
2021 2020
NZ$000 NZ$000
Balance at 1 October
10,338 12,671
Lease amendments
185 -
Depreciation charges
(2,347) (2,350)
Exchange differences
(14) 17
Lease assets at 30 September
8,162 10,338
Property
8,156 10,302
Office equipment
6 36
Lease assets at 30 September
8,162 10,338
Office equipment includes Coffee Machines and Printer/Copiers.
FINANCIAL STATEMENTS / 61
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 45
9.1 LEASE ASSETS AND LEASE LIABILITIES (CONTINUED)
LEASE LIABILITIES
2021 2020
NZ$000 NZ$000
Balance at 1 October
15,127 17,620
Lease amendments
185 -
Principal repayments
(2,748) (2,457)
Exchange differences
(12) (36)
Lease liabilities at 30 September
12,552 15,127
Less than one year
1,376 2,692
One to five years
5,486 5,229
More than five years
5,690 7,206
Lease liabilities at 30 September
12,552 15,127
LEASE EXPENSES
2021 2020
NZ$000 NZ$000
Depreciation charges
2,347 2,351
Finance charges
814 931
Lease expenses
3,161 3,282
9.2 AUDITORS REMUNERATION
The table below outlines the amounts paid to auditors during the year ended 30 September 2021. Gentrack Group’s
current Group auditor is EY after switching from KPMG at the beginning of the year.
2021 2020
NZ$000 NZ$000
KPMG - audit fees
86 517
KPMG - review fees
- 116
KPMG - taxation services
301 221
EY - audit fees
400 -
Entrust - audit fees 6 6
Total fees paid to auditor(s)
793 860
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2021
GENTRACK FINANCIAL STATEMENTS / 46
9.3 KEY MANAGEMENT AND RELATED PARTIES
Key management personnel are defined as those persons having authority and responsibility for planning,
directing, and controlling the activities of Gentrack Group, directly or indirectly, and include the Directors,
the Chief Executive, their direct reports. The following table summarises remuneration paid to key
management personnel.
2021 2020
NZ$000 NZ$000
Salaries, bonus and other benefits
4,526 4,157
Share-based payments
465 -
Directors' fees
606 386
Remuneration paid to Key Management Personnel
5,597 4,543
Gentrack Group’s Directors are also directors of other companies. During the year ended 30 September 2021 no
transactions have occurred between Gentrack Group and any of these companies.
Some of the Directors and key management personnel are shareholders in Gentrack Group Limited. Gentrack Group
does not transact with the Directors or key management personnel, and their related parties, other than in their
capacity as Directors, consultants, and employees. Refer to note 2.4 for more information on other related parties.
9.4 OTHER DISCLOSURES
CAPITAL
COMMITMENTS
There are no capital commitments at 30 September 2021 (2020: $Nil).
CONTINGENCIES
ASB New Zealand has provided guarantees of $1.1m (2020: $0.9m) on behalf of the Gentrack Group, these guarantees
are in place for software implementation projects, property leases and credit card programs.
EVENTS
AFTER BALANCE DATE
There were no material events after balance date.
On 24 November 2021, the Gentrack Group Board determined that no final dividend will be paid out for the 2021
financial year (2020: nil).
62 / FINANCIAL STATEMENTS
CORPORATE GOVERNANCE
The Board recognises the importance of good corporate governance, particularly its role in delivering improved
corporate performance and protecting the interests of all stakeholders.
The Board is responsible for establishing and implementing the Company’s corporate governance frameworks, and is
committed to fulfilling this role in accordance with best practice while observing applicable laws, and NZX Corporate
Governance guidance.
This section sets out the Company’s commitment to good corporate governance and addresses the Company’s
compliance with the eight fundamental principles of the NZX Corporate Governance Code (NZX Code).
The Company’s Constitution, the Charters and most of the policies referred to in this Corporate Governance
Statement are available on the Company’s website www.gentrack.com (“Company Website”) in the Leadership and
Governance section of the Investor Centre.
This corporate governance statement is current as at December 2021 and has been approved by the Board.
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.
The Board maintains high standards of ethical conduct and the Chief Executive Officer is responsible for ensuring that
high standards of conduct are maintained by all staff and for managing any breaches of these standards. The Board
has adopted a “Code of Ethics”, a copy of which is available in the Investor Centre section of the Company’s website.
The Board is the overall and final body responsible for all decision making within the Company, with the core
objective of representing and promoting the interests of shareholders by adding long-term value to the Company.
The Company has a Share Trading Policy for the approval of all share purchases and sales by staff, including Directors.
A copy of this policy is available in the Investor Centre section of the Company’s website.
The Company undertakes appropriate checks of prospective Directors prior to putting forward a candidate for
election and provides material information in its possession relevant to such a decision to security holders.
PRINCIPLE 2 – BOARD COMPOSITION & PERFORMANCE
To ensure an effective Board, there should be a balance of independence, skills, knowledge, experience and
perspectives.
BOARD CHARTER
This describes the Board’s role and responsibilities and regulates internal Board procedures; a copy of this document
is available in the Investor Centre section on the Company’s website.
The Board directs, and supervises the management of the business affairs of the Company including, in particular:
• ensuring that the Company’s goals are clearly established, and that strategies and resources are in place for
achieving them;
• ensuring that there is an ongoing review of performance against the Company’s strategic objectives;
• approving transactions relating to acquisitions and divestments and capital expenditure above delegated
authority limits;
• ensuring that there is an ongoing assessment of business risks and that there are appropriate control and
accountability systems in place to manage them;
• monitoring the performance of management and overseeing company-wide remuneration, employment and
health and safety practices;
• appointing the Chief Executive Officer, setting the terms of their employment and, where necessary, terminating
their employment;
• approving and monitoring the Company’s financial and other reporting and ensuring the Company’s financial
statements represent a true and fair view; and
• setting the dividend policy.
CORPORATE GOVERNANCE / 63
CORPORATE GOVERNANCE
NOMINATION AND APPOINTMENT
The procedures for the appointment and removal of Directors are ultimately governed by the Company’s
Constitution. The Board has established a People, Nominations and Remuneration Committee whose role is to,
amongst other things, identify and recommend to the Board individuals for nomination as members of the Board
and its Committees, taking into account such factors as it deems appropriate, including experience, qualifications,
judgement and the ability to work with other Directors.
COMPOSITION OF BOARD
As at 30 September 2021 the Board comprised five Directors, as follows:
• Andy Green (Non-executive Chair) – appointed 2 November 2020
• Stewart Sherriff (Non-executive Director) – appointed 5 October 2020
• Gary Miles (Managing Director) – appointed 1 October 2020
• Fiona Oliver (Non-executive Director) – appointed February 2019
• Darc Rasmussen (Non-executive Director) – appointed December 2019
• Nick Luckock (Non-executive Director) – appointed February 2018
Andy, Stewart and Gary were appointed by the Board.
Profiles of each current Director are available in the Investor Centre section on the Company’s website.
The Company has written agreements with each board member establishing the terms of their appointment.
DELEGATION
To enhance efficiency, the Board has delegated some of its powers to Board Committees and other powers to the
Chief Executive Officer. The terms of the delegation by the Board to the Chief Executive Officer are documented in
the Board Charter and more clearly set out in the Company’s Delegated Authority Framework. This framework also
establishes the authority levels for decision-making within the Company’s management team.
DIRECTOR INDEPENDENCE
The Board Charter requires that at least 50% of Directors be “independent”.
The Board takes into account the guidance provided under the NZX Listing Rules in determining the independence
of Directors.
The Board will review any determination it makes as to a Director’s independence on becoming aware of any
information that may have an impact on the independence of the Director. For this purpose, Directors are required
to ensure that they immediately advise the Board of any relevant new or changed relationships to enable the Board
to consider and determine the materiality of the relationships.
The Board considers that Stewart Sherriff, Darc Rasmussen, Fiona Oliver and Andy Green are Independent
Directors. Following the sale of Hg Capital’s stake in Gentrack in June 2021, Nick Luckock is now also classed as an
independent Director.
SELECTION AND ROLE OF CHAIR
The Chair of the Board is elected by the non-executive Directors. The Board supports the separation of the role of
Chair and Chief Executive Officer. The Chair’s role is to manage the Board effectively, to provide leadership to the
Board, and to facilitate the Board’s interface with the Chief Executive Officer.
Andy Green was appointed by the Board as Chair on 2 November 2020, taking over from Fiona Oliver who
relinquished the Acting Chair role. As noted above, Andy Green is an Independent Director. Andy brings
transformation and technology leadership to the role of the Company Chair. In 2020 he was awarded Commander
of the British Empire (CBE) for his contributions to the Information Technology and British Space Industries. His
passion to transform the industry to support sustainable water and energy resources is further demonstrated by his
roles as the Chair of WaterAid UK and as a UK National Infrastructure Commissioner. Andy spends his time in both
Australia and the UK which contributes both a local presence and global perspective to the Company’s customers
and shareholders.
64 / CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
DIVERSITY AND INCLUSION POLICY
The Company recognises the importance of diversity and inclusion and is committed to promoting these values
within its workplace and culture. The Board supports this initiative and has approved a Diversity and Inclusion Policy, a
copy of which is available in the Investor Centre on the Company’s website.
Diversity and Inclusion Committees have been established in the Company in all locations.
Flexible working and work from home arrangements have also been introduced and a number of initiatives have
been held during the year to support diversity and inclusion, including a Diversity Week to celebrate diversity.
At 30 September 2021, the gender breakdown for the Company (and its wholly owned subsidiaries) was as follows:
These figures include permanent full-time, permanent part-time and fixed-term employees, but not independent
contractors or consultants. A Senior Executive is defined as an employee who reports directly to the Chief Executive
Officer. The Company recruits for predominantly technology roles.
DIRECTOR EDUCATION
All Directors are responsible for ensuring they remain current in understanding their duties as Directors. Directors are
provided access to the Company’s on-line knowledge hub.
RETIREMENT AND RE-ELECTION
The Board acknowledges and observes the relevant Director rotation/retirement rules under the NZX Listing Rules.
DIRECTORS’ SHARE OWNERSHIP
The table of Directors’ shareholdings is included in the Disclosures section of this Annual Report.
INDEMNITIES AND INSURANCE
Deeds of Indemnity have been granted by the Company in favour of the Directors in relation to potential liabilities
and costs they may incur for acts or omissions in their capacity as Directors.
The Directors’ and Officers’ Liability insurance covers risks normally covered by such policies arising out of acts or
omissions of Directors and employees in their capacity as such.
BOARDSENIOR EXECUTIVESALL EMPLOYEES
FY21
Female12137
Male57353
% Female17%22%28%
FY20
Female11123
Male48348
% Female20%11%26%
CORPORATE GOVERNANCE / 65
CORPORATE GOVERNANCE
BOARD MEETINGS
The Board has a standard schedule which includes meeting eleven times per annum. In addition other board
meetings are held as needed to deal with specific matters such as acquisition related activity. In the year ended
30 September 2021 there were eleven Board meetings in total. There were also separate meetings of the Board
Committees. Directors receive detailed information in Board papers to facilitate decision making. At each meeting the
Board considers key financial and operational information as well as matters of strategic importance.
Executives regularly attend Board meetings and are also available to be contacted by Directors between meetings.
Directors who are not members of the Committees are invited to attend all meetings of the Committees
1
Andy Green joined the Board in November 2020.
Membership of the Board Committees is set out below.
The Board has a broad range of IT, financial, sales, business, risk management and other skills and expertise necessary
to meet its objectives.
BOARD ACCESS TO INFORMATION AND ADVICE
The Company Secretary is responsible for supporting the effectiveness of the Board by ensuring that policies and
procedures are followed and co-ordinating the completion and dispatch of the Board agendas and papers.
All Directors have access to the senior management team to discuss issues or obtain information on specific areas in
relation to items to be considered at Board meetings or other areas as they consider appropriate. Further, Directors
have unrestricted access to Group records and information.
The Board, the Board Committees and each Director have the right, subject to the approval of the Chair, to seek
independent professional advice at the Company’s expense to assist them to carry out their responsibilities. Further,
the Board and Board Committees have the authority to secure the attendance at meetings of outsiders with relevant
experience and expertise.
CONFLICTS OF INTEREST
The Board Charter outlines the Board’s policy on conflicts of interest. Where conflicts of interest do exist, Directors
excuse themselves from discussions and do not exercise their right to vote in respect of such matters.
PERFORMANCE REVIEW
The Board has a formal review of its performance on an annual basis. A review was undertaken in September 2021.
BOARD
AUDIT AND RISK
COMMITTEE
PEOPLE, NOMINATIONS
AND REMUNERATION
COMMITTEE
DIRECTOR
NO. OF
MEETINGS
NO.
ATTENDED
NO. OF
MEETINGS
NO.
ATTENDED
NO. OF
MEETINGS
NO.
ATTENDED
Andy Green
1
10108844
Fiona Oliver11118844
Darc Rasmussen111187--
Stewart Sherriff11118-44
Nick Luckock11118---
Gary Miles11118---
66 / CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
PRINCIPLE 3 – BOARD COMMITTEES
The Board should use committees where this will enhance its effectiveness in key areas, while still retaining
board responsibility.
BOARD COMMITTEES
The Board has established two Committees: the Audit and Risk Committee, and the People, Nominations
and Remuneration Committee. The Charters of each Committee are in the Investor Centre section of the
Company’s website.
The membership of each Committee at 30 September 2021 was:
1. Audit and Risk Committee – Fiona Oliver (Chair), Andy Green, Darc Rasmussen
2. People, Nominations and Remuneration Committee – Fiona Oliver (Chair), Andy Green, Stewart Sherriff.
All of the members of the above committees are independent directors. Management and other employees attend
committee meetings at the invitation of the respective committee.
For further details on the functions of the Audit and Risk Committee please refer to “Principle 7”. For further details on
the functions of the People, Nominations and Remuneration Committee please refer to “Principle 2” and “Principle 5”.
The Board finalised a Takeover Response Protocol in 2018. The Protocol outlines the procedures in the event the
Company is subject to a takeover offer.
PRINCIPLE 4 – REPORTING & DISCLOSURE
The Board should demand integrity in financial and non-financial reporting, and in the timeliness and balance of
corporate disclosures.
The Company is committed to maintaining a fully informed market through effective communication with the
NZX and ASX, the Company’s shareholders, analysts, media and other interested parties. The Company provides
all stakeholders with equal and timely access to material information that is accurate, balanced, meaningful
and consistent.
The Board has adopted a Market Disclosure Policy and a Shareholder Communications Policy, copies of which are
available in the Investor Centre section on the Company’s website. The Policies have been communicated internally
to ensure that they are strictly adhered to by the Board and the Company’s employees. The Company has been
listed on the NZX Main Board and the ASX since 25 June 2014 and has at all times complied with its continuous
disclosure obligations.
Directors consider at each Board meeting whether there is any material information which should be disclosed to
the market.
The “Code of Ethics”, Board Committee Charters and other key governance documents are available in the Investor
Centre section of the Company’s website.
The Company does not currently provide additional non-financial reporting on environmental, social and governance
factors other than as set out in this statement.
PRINCIPLE 5 – REMUNERATION
The remuneration of Directors and executives should be transparent, fair and reasonable.
The Board has a People, Nominations and Remuneration Committee. One of that Committee’s principal functions is
to oversee the remuneration strategies and policies of the Company. The People, Nominations and Remuneration
Committee is governed by a formal charter, a copy of which is available in the Investor Centre section on the
Company’s website.
DIRECTOR REMUNERATION
The Company distinguishes the structure of non-executive Directors’ remuneration from that of executive Directors.
Total Directors’ fees are currently set at a maximum of $800,000 per annum for the non-executive Directors. The actual
amount of fees paid in the past year was $606,100.
CORPORATE GOVERNANCE / 67
CORPORATE GOVERNANCE
CEO REMUNERATION
Gary Miles’ salary is structured as follows:
Fixed Base Salary
For FY2021 Gary has a Fixed Base Salary of UK£403,000 per annum, inclusive of pension contributions and
reviewable at the Board’s discretion annually in October.
Short Term Incentive
Annual short term incentive payments of up to 100% of the fixed base salary. The actual short term incentive awarded
(if any) is determined at the discretion of the Board after assessing the performance of the Company and the
performance of the CEO against performance targets and priorities agreed annually. Following completion of his first
year of employment (FY21) Gary will receive a minimum of 75% of his fixed base of salary and this is not subject to
any performance targets. His annual short term incentive can range up to 100% dependent on performance criteria.
Long Term Incentive
The CEO’s remuneration package includes the issue of performance rights that were approved at the Annual Meeting
in February 2021:
• an initial grant of 500,000 performance rights of which half vest immediately on the start of Gary’s employment and
the other half of which vest on the one year anniversary of Gary starting employment with Gentrack. The vesting of
this initial grant of performance rights is not subject to vesting conditions or performance hurdles;
• an annual grant of performance rights commencing in October 2020 that is calculated and vests in accordance
with the following:
• number of performance rights = Z /Y
• “Z” = Gary’s annual base pay, including pension contribution, converted into NZD and multiplied by 120%; and
• “Y” = the volume weighted average price of Gentrack’s shares over the 10 day trading period ending on the last
trading day immediately prior to the annual grant
• year one performance rights vest in one year subject to performance hurdles that are aligned with initial
business transformation objectives and Gentrack Group financial performance against budget
• subsequent annual performance rights vest one third each year over three years with half of rights eligible
to vest each year subject to Gentrack Group achieving certain performance hurdles that are aligned to
sustained earnings per share growth and the other half of rights eligible to vest doing so without reference to
performance hurdles.
The Remuneration Policy Statement is available in the Investor Centre section of the Company’s website.
68 / CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
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.
The Board has an Audit and Risk Committee that reports to the Board – please see “Principle 7” below for further
detail in relation to the Audit and Risk Committee.
The Company’s senior management maintain a Risk Register, which is reviewed by the Audit and Risk Committee and
forms a key part of the risk management framework.
To support its commitment to Information Security Management, the Company is an ISO/EC 27001:2013 certified
organisation. ISO/IEC 27001:2013 specifies the requirements for establishing, implementing, maintaining and continually
improving an information security management system. It also includes requirements for the assessment and treatment
of information security risks tailored to the needs of the organisation. The purpose of this international standard is to help
organisations establish and maintain an information security management system to manage and control information
security risks as well as maintaining the integrity, protection, preservation and confidentiality of information. In addition to
the above, the Company maintains a SOC2 Type I Report for applicable Gentrack Cloud services (GCIS & GCMDS). This
report demonstrates how the Company achieves key compliance controls and objectives relevant to the Trust Services
Categories (security and availability) as set forth by the American Institute of Certified Public Accountants. This is assessed
by an independent third-party examination body as it relates to Gentrack Cloud services, as of 15 December 2021.
The Company does not have an internal audit function, but through the steps outlined above the Board ensures the
company is reviewing, evaluating and continually improving the effectiveness of its risk management and internal
control processes.
The Company considers that it does not have any material exposure to economic, environmental and social
sustainability risks. The Board receives a health and safety report and an information security report each quarter.
PRINCIPLE 7 – AUDITORS
The Board should ensure the quality and independence of the external audit process.
The Board is committed to a transparent system for auditing and reporting of the Company’s financial performance.
The Board established an Audit and Risk Committee, which performs a central role in achieving this goal. The
members of the Committee provide a balance of independence, sector experience and relevant professional
experience and qualifications.
The Audit and Risk Committee’s principal functions are:
• to assist the Board in fulfilling its responsibilities for the Company’s financial statements and external financial
reporting;
• to assist the Board in ensuring that the ability and independence of the external auditors to carry out their statutory
audit role is not impaired, or could reasonably be perceived to be impaired;
• to assist the Board in ensuring appropriate accounting policies and internal controls are established and
maintained; and
• to assist the Board in ensuring the efficient and effective management of all business risks.
One of the main purposes of the Audit and Risk Committee is to ensure the quality and independence of the audit
process. The Chairman of the Audit and Risk Committee and Chief Financial Officer work with the external auditors to
plan the audit approach. All aspects of the audit are reported back to the Audit and Risk Committee and the auditors
are given the opportunity at Audit and Risk Committee meetings to meet with the Board.
The Audit and Risk Committee has adopted a formal Charter, a copy of which is available in the Investor Centre
section on the Company’s website.
The Company does not have an internal audit function. The Audit and Risk Committee meets regularly to identify risks
and determine how to mitigate these. The Company uses external contractors as required for specific audit reviews.
The Company’s external auditors will attend the annual meeting, and are available to answer questions relating to
the conduct of the external audit and the preparation and content of the auditor’s report. The external auditors also
provided non-audit related services to the Company relating to local and international tax advisory and compliance.
The Company does not have an internal audit function. Where required, such audit activity is conducted by third parties,
not by the Company’s external auditors.
CORPORATE GOVERNANCE / 69
CORPORATE GOVERNANCE
TYPE OF HOLDING
2021
RELEVANT INTEREST
IN SHARES HELD
2020
RELEVANT INTEREST
IN SHARES HELD
Gary Miles Direct250,000-
Nick Luckock
1
Beneficial Interest-11,191,471
Andy GreenBeneficial Interest28,389-
1
Nick Luckock is a Partner of Hg Capital. Hg Capital controls Devaron (NZ) Limited which was a substantial
shareholder of the Company until June 2021.
PRINCIPLE 8 – SHAREHOLDER RIGHTS & RELATIONS
The Board should respect the rights of shareholders and foster constructive relationships with shareholders that
encourage them to engage with the issuer.
The company currently keeps shareholders informed through:
• the annual report;
• the half-year update;
• the annual meeting of shareholders;
• disclosure to the NZX and ASX in accordance with the Company’s Shareholder Communications Policy and Market
Disclosure Policy; and
• the Investor Centre section on the Company’s website.
The company’s Shareholder Communications Policy and Market Disclosure Policy are designed to ensure that
communications with shareholders and all other stakeholders are managed efficiently. The Chair, Chief Executive
Officer and Chief Financial Officer are the points of contact for shareholders and analysts.
The Board considers the annual report to be an essential opportunity for communicating with shareholders. The
company publishes its results and reports electronically on the Company Website. Investors may also request a hard
copy of the annual report by contacting the company’s share registrar, Link Market Services Limited. Contact details
for the registrar appear at the end of this report.
The Company considers the annual meeting to be a valuable element of its communications programme. The Chair
will provide an opportunity for shareholders to raise questions for their Board. The Chair may ask the Chief Executive
Officer and any relevant manager of the Company to assist in answering questions if required. As noted earlier, the
Company’s external auditors will also attend the annual meeting, and are available to answer questions relating to the
conduct of the external audit and the preparation and content of the auditor’s report.
ENTRIES RECORDED IN THE INTERESTS REGISTER
The Company maintains an Interest Register in accordance with the Companies Act 1993. The following entries were
made in the Interests Register for the period 1 October 2020 to 30 September 2021 and require disclosure:
• Fiona Oliver advised that she had been appointed as a board member of Freightways Limited commencing
5 July 2021
• Fiona Oliver advised that she had resigned as a director of Tilt Renewables Limited and all its subsidiaries with
effect from 3 August 2021.
SHAREHOLDINGS OF DIRECTORS AT 30 SEPTEMBER 2021
70 / CORPORATE GOVERNANCE
REMUNERATION OF DIRECTORS
Details of the total remuneration of, and the value of other benefits received by, each Director of Gentrack Group
Limited during the financial year ended 30 September 2021 are as follows:
20212020
Andy Green263,400-
Fiona Oliver115,00088,300
Nick Luckock49,50020,700
Stewart Sherriff84,000-
Darc Rasmussen85,00049,800
Gary Miles--
Andy Coupe8,30064,900
Leigh Warren90062,000
John Clifford-87,800
James Docking-12,300
TOTAL606,100385,800
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE / 71
CORPORATE GOVERNANCE
EMPLOYEE REMUNERATION
The number of current employees of the parent and subsidiaries receiving remuneration and benefits above
$100,000 in the year ended 30 September 2021 are set out in the table below:
The analysis above includes the remuneration and benefits paid to employees, in the relevant bandings, where their
annual remuneration and benefits exceed $100,000.
REMUNERATION
NUMBER OF
EMPLOYEES
$100,000 - $110,000 42
$110,001 - $120,000 20
$120,001 - $130,000 20
$130,001 - $140,000 17
$140,001 - $150,000 22
$150,001 - $160,000 17
$160,001 - $170,000 13
$170,001 - $180,000 13
$180,001 - $190,000 7
$190,001 - $200,000 7
$200,001 - $210,000 5
$210,001 - $220,000 3
$220,001 - $230,000 2
$230,001 - $240,000 2
$240,001 - $250,000 1
$250,001 - $260,000 1
$260,001 - $270,000 2
$280,001 - $290,000 3
$320,001 - $330,000 1
$330,001 - $340,000 2
$390,001 - $400,000 2
$500,001 - $510,000 1
$580,001 - $590,000 1
$1,170,001 - $1,180,000 1
72 / CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
ANALYSIS OF SHAREHOLDING
SIZE OF HOLDING
NUMBER OF
HOLDERS
FULLY PAID ORDINARY
SHARES NUMBER OF
SHARES
% OF ISSUED CAPITAL
1 – 1,0001.394678,8550.69
1,001 – 5,0001,4123,676,9243.71
5,001 – 10,0004323,243,7993.27
10,001 – 50,0002985,960,6666.02
50,001 – 100,000503,586,1923.72
Greater than 100,0003681,800,88782.59
TOTAL3,62298,947,323100
CORPORATE GOVERNANCE / 73
CORPORATE GOVERNANCE
TWENTY LARGEST SHAREHOLDERS
The twenty largest shareholders of fully paid ordinary shares as at 3 December 2021 were:
1
These shareholdings are held through New Zealand Central Securities Depository Limited (NZCSD)
which allows electronic trading of securities to members.
The percentage shareholding of the 20 largest shareholders of Gentrack Group Limited fully paid
ordinary shares was 77.99%.
NAME
NUMBER OF
ORDINARY SHARES
HELD
% OF ISSUED SHARE
CAPITAL
National Nominees Limited 22,918,994 22.90
National Nominees New Zealand Limited
1
20,647,337 20.63
BNP Paribas Nominees NZ Limited
1
10,285,363 10.28
Custodial Services Limited 3,928,088 3.93
J P Morgan Nominees Australia Pty Limited 2,931,667 2.93
Qexle Limited 2,790,000 2.79
Citicorp Nominees Pty Limited 2,023,301 2.02
Anacacia Pty Ltd 2,000,000 2.00
Roy Desmond Grant & Nina Catherine Maria
Grant & Adrienne Alexandra Wigmore
1,400,000 1.40
Terence De Montalt Maude & Wendy Fay Wood 1,300,000 1.30
HSBC Custody Nominees (Australia) Limited 1,293,651 1.29
Anacacia Pty Limited 1,223,420 1.22
New Zealand Depository Nominee 1,180,011 1.18
Gary Miles 797,657 0.80
HSBC Nominees (New Zealand) Limited
1
755,643 0.76
Melissa Gaik Teng Hong 583,189 0.58
Citibank Nominees (Nz) Ltd
1
579,426 0.58
Gracey Family Investments Pty Ltd 500,000 0.50
Shireburn Company Limited 462,466 0.46
BNP Paribas Nominees Pty Ltd 444,840 0.44
TOTAL78,045,053 77.99
74 / CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
SUBSTANTIAL SHAREHOLDERS AS AT 30 SEPTEMBER 2021
According to notices given under the Financial Markets Conduct Act 2013 the following persons were Substantial
Shareholders in Gentrack Group Limited at 30 September 2021 in respect of the number of voting securities set
opposite their names.
The total number of issued voting shares of Gentrack Group Limited at 30 September 2021 was 98,947,323. Voting at
a meeting of the shareholders is via a poll. At the meeting, every shareholder present in person, or by representative
has one vote for each fully paid ordinary share in the Company.
At 30 September 2021, there were 455 shareholders holding marketable parcels of less than $500.
SUBSIDIARY COMPANY DIRECTORS
The following people held office as Directors of subsidiary companies at 30 September 2021:
The following former Directors of the Company’s subsidiaries ceased to hold office during the year:
2020 – Paul Muscat, Rosalynn Bartlett, Jonathan Kershaw.
Directors of the Company’s subsidiaries do not receive any remuneration or other benefits in respect of their
appointments.
NAME
NUMBER OF
ORDINARY SHARES
HELD
% OF ISSUED SHARE
CAPITAL
NAOS Asset Management Limited19,761,19119.97
National Nominees Ltd ACF Australian Ethical
Investment Limited
12,771,66812.91
Swann Hill BV9,533,2019.63
Milford Asset Management Limited8,844,4248.94
TOTAL50,910,48451.45
Gentrack LimitedAlastair James Spence, Allan Sampson
Veovo Group LimitedAlastair James Spence, James Williamson, Gary Miles
Gentrack Group Australia Pty LimitedAlastair James Spence, Mark Humphreys
Gentrack Pty LimitedAlastair James Spence, Mark Humphreys
Gentrack UK LimitedAlastair James Spence, Geoffrey Childs, Derek Dyamond
Gentrack Holdings UK LimitedAlastair James Spence, Derek Dyamond, Geoff Childs
Junifer Systems Limited (not trading)Derek Dyamond, Alastair James Spence
Gentrack (Singapore) Pte LtdAlastair James Spence, Allan Sampson, K Kalaai Araasi Pillai
Veovo Holdings DenmarkAlastair James Spence, James Williamson, Gary Miles
Veovo AS
Alastair James Spence, James Williamson,
Peter Christian Knudsen
CA Plus LimitedJames Williamson, Alastair James Spence
Evolve Analytics Limited (not trading)Alastair James Spence, Derek Dyamond
Evolve Parent Limited (not trading)Alastair James Spence, Derek Dyamond
Veovo IncAlastair James Spence, James Williamson
Veovo NZ Limited (trading from 1 October 2020)Alastair James Spence, James Williamson
Veovo UK Limited (trading from 1 October 2020)Alastair James Spence, James Williamson
Veovo IP Limited (trading from 1 October 2020)Alastair James Spence, James Williamson
CORPORATE GOVERNANCE / 75
76 / CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
DONATIONS
The Company made donations of $26,492 during the year ended 30 September 2021.
CREDIT RATING
The Company has no credit rating.
FOREIGN EXEMPT LISTING
ASX approved a change in the Company’s ASX admission category from an ASX Listing to an ASX Foreign Exempt
Listing, effective from the commencement of trading on 30 March 2016.
The Company continues to have a full listing on the NZX Main Board, and the Company’s shares are still listed on
the ASX. The Company is primarily regulated by the NZX, complies with the NZX Listing Rules, and is exempt from
complying with most of the ASX Listing Rules (based on the principle of substituted compliance).
WAIVERS
NZX RegCo granted Gentrack Group Limited a waiver from the requirement for the Company to include an appraisal
report with its Notice of Meeting in respect of the resolution relating to the issue of performance rights to its
Managing Director under Listing Rule 7.8.5. The terms of the waiver can be found on the Company’s announcement
page on the NZX website (https://www.nzx.com/companies/GTK/announcements)
ANNUAL MEETING
Gentrack Group Limited’s Annual Meeting of Shareholders will be held virtually on 24 February 2022. A notice of
Annual Meeting and Proxy Form will be circulated to shareholders in January 2022.
CORPORATE DIRECTORY / 77
CORPORATE DIRECTORY
REGISTERED OFFICE
Gentrack Group Limited
17 Hargreaves Street, St Marys Bay, Auckland 1011,
New Zealand
Phone: +64 9 966 6090
Level 9, 390 St Kilda Road, Melbourne, VIC 3004
Australia
Phone: +61 3 9867 9100
POSTAL ADDRESS
PO Box 3288, Shortland Street, Auckland 1140
New Zealand
Level 9, 390 St Kilda Road, Melbourne, VIC 3004
Australia
NEW ZEALAND INCORPORATION NUMBER
3768390
AUSTRALIAN REGISTERED BODY NUMBER (ARBN)
169 195 751
DIRECTORS
Andy Green, Chair
Fiona Oliver
Nick Luckock
Stewart Sherriff
Darc Rasmussen
Gary Miles
COMPANY SECRETARY
Pip White
AUDITOR
Ernst & Young
2 Takutai Square
Auckland CBD
Auckland 1010
LEGAL ADVISERS
BELL GULLY
BANKERS
ASB BANK LIMITED ANZ LIMITED HSBC PLC
NORDEA DENMARK A/S
BANK OF VALLETTA PLC
TRUIST FINANCIAL CORPORATION
SHARE REGISTRAR
NEW ZEALAND
LINK MARKET SERVICES LIMITED
Level 30, PWC Tower 15
Customs Street West,
Auckland 1010
PO Box 91 976, Auckland 1142
Phone: +64 9 375 5998
Facsimile: +64 9 375 5990
Email: enquiries@linkmarketservices.com
AUSTRALIA
LINK MARKET SERVICES LIMITED
Level 12, 680 George Street, Sydney, NSW 2000
Locked Bag A14, Sydney South, NSW 1235
Phone: +61 1300 554 474
Facsimile: +2 9287 0303
Email: enquiries@linkmarketservices.com
About Gentrack
The global pace of change is accelerating, and utilities need to
rebuild for a more sustainable future. Gentrack provides leading
utilities across the world with innovative cleantech solutions.
Working with some of the world’s biggest energy and water
companies, as well as innovative challenger brands, we are helping
companies reshape what it means to be a utilities business.
We are driven by our passion to create positive impact. That is
why utilities rely on us to drive innovation, deliver great customer
experiences and secure profits.
Together, we are renewing utilities.
www.gentrack.com© 2021 Gentrack. All rights reserved.
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.