Wellington creates platform for growth – Revenue up 74%
®
is a registered Trade Mark of Wellington Drive Technologies WT 9645
Wellington Drive Technologies Ltd
P: +64 9 477 4500 E: info@wdtl.com
21 Arrenway Drive, Rosedale, Auckland 0632
PO Box 302-533 North Harbour, Auckland 0751, New Zealand
www.wdtl.com
25 February 2022
Market Release
For immediate release
Wellington creates platform for growth - Revenue up 74%
Wellington Drive Technologies Limited (Wellington), a leading provider of Internet of Things (IoT) solutions
and energy-efficient motors to the retail food and beverage industry, today released its fully audited
financial statements for the year ended 31 December 2021. The 2021 Annual Report can be found on the
Company’s web site at https://www.wdtl.com/investors/financial-results-and-reports.
The result is consistent with guidance provided on 15 December 2021.
2021 revenue was $64.2m, a 74.1% increase over 2020 a COVID-affected year. FY21 revenue grew 4%
above the FY19 pre-COVID year, even though FY21 was impacted by COVID with factory closures and
supply chain constraints.
Gross margin was 27.8% for FY21 compared to 28.6% for FY20. To support the increased demand from
customers and to manage significant supply chain disruption we bought some component parts on the spot
market, when they were not available from regular suppliers, costing an additional $1.1m. This, along with
higher shipping costs, could not always be passed on and caused some reduction in gross margin this
year. We expect this position to continue into FY22.
Operating costs increased from $11.5m to $15.1m, reflecting the restoration of normal remuneration,
increased salary levels to assist retention and additional investment to support business growth. The cost in
FY21 also included the repayment of voluntary staff salary reductions in 2020 amounting to $1.1m.
EBITDA increased from $1.2m to $2.6m although the improvement in underlying earnings is not
immediately apparent in these numbers. EBITDA in FY20 benefited from voluntary staff salary reductions,
government wage support payments amounting to $1.1m and a $1.0m non-cash income relating to the iPX
earn out. EBITDA in FY21 is after repayment to the staff of the 2020 salary reductions and an $0.3m non-
cash charge relating to the iPX earn out.
WT 9645
2
Underlying EBITDA after adjusting for these non-recurring items was a $6.1m improvement over FY20.
$000
2021 2020
EBITDA as reported 2,626 1,190
FY20 voluntary staff salary reductions repaid in FY21 1,109 (1,109)
Government wage support paid (15) (1,090)
iPX non-cash earn out 323 (1,016)
EBITDA adjusted 4,043 (2,025)
The net profit after tax for FY21 was $5.4m, this includes a non-cash tax credit of $6.1m to partially
recognise temporary differences and historic tax losses.
Operating cash flows in FY21 was $3.9m. Cash on hand increased from $4.6m in December 2020 to $6.0m
at the end of FY21. We consider we are adequately funded to execute current business plans.
Wellington is updating its guidance in respect to earnings and maintaining existing guidance for revenue for
FY22.
Revenue is expected to continue growing strongly in FY22, with the Company forecasting growth of
approximately 25% to around US$60m. Revenue would likely be higher if there were no constraints on
component supply. The additional gross profit from this growth is being reinvested into the expansion of
engineering and sales staff, and infrastructure as Wellington broadens its product and geographic spread.
We expect EBITDA in FY22 to be in the range of $4.5m to $5.5m, this forecast result is subject to the
Company successfully navigating today’s challenging supply chain environment.
CEO Greg Balla commented, “The Wellington team and our partners delivered an exceptional result in a
challenging FY21 environment. We continue to see strong demand for our Connect IoT solution and our
energy efficient ECR motors. This demand is accelerating as our customer’s return on investment (ROI) from
our IoT solution improves with greater engagement. While we are still experiencing significant supply chain
disruption, our teams continue to find outstanding solutions to these challenges. We are investing in people
to accelerate new product development, expand geographies and ensure we are attracting and retaining
great people. We are very focussed on helping our customers connect their complete fleets to our Connect
IoT platform to deliver on the growth potential for Wellington.”
About Wellington Drive Technologies:
Wellington is a leading provider of IoT solutions, cloud-based fleet management platforms, energy-
efficient electronic motors and connected refrigeration control solutions. It serves some of the world’s
leading food and beverage brands and refrigerator manufacturers and offers proximity-based marketing
for Smart Cities to the Australian market. Wellington’s services and products improve sales, decrease
costs and reduce energy consumption. Headquartered in Auckland with a global reach, Wellington is
listed on the New Zealand stock exchange under the ticker symbol NZ:WDT
For further information visit www.wdtl.com
WT 9645
3
Contact:
Greg Balla Howard Milliner
Chief Executive Officer Chief Financial Officer
Phone +64 21 938601 +64 27 5870455
---
Template
Results announcement
(for Equity Security issuer/Equity and Debt Security issuer)
Updated as at 17 October 2019
Results for announcement to the market
Name of issuer Wellington Drive Technologies Limited
Reporting Period 12 months to 31 December 2021
Previous Reporting Period 12 months to 31 December 2020
Currency New Zealand Dollar
Amount (000s) Percentage change
Revenue from continuing
operations
$64,218 +74.1%
Total Revenue $64,218 +74.1%
Net profit/(loss) from
continuing operations
$5,425 n/a
Total net profit/(loss) $5,425 n/a
Interim/Final Dividend
Amount per Quoted Equity
Security
No dividend will be paid
Imputed amount per Quoted
Equity Security
n/a
Record Date n/a
Dividend Payment Date n/a
Current period Prior comparable period
Net tangible assets per
Quoted Equity Security
$0.018 $0.005
A brief explanation of any of
the figures above necessary
to enable the figures to be
understood
See announcement and attached Annual Report 2021
Authority for this announcement
Name of person
authorised
to make this announcement
Howard Milliner
Contact person for this
announcement
Howard Milliner
Contact phone number 0275870455
Contact email address Howard.milliner@wdtl.com
Date of release through MAP
2502/2021
Audited financial statements accompany this announcement.
---
Annual Report
2021
Wellington
Annual Report 2021
12
Annual Report 2021Annual Report 2021Wellington Drive Technologies Ltd
Wellington Drive Technologies Ltd
Contents
® is a registered Trade Mark of Wellington Drive Technologies Ltd
There are statements in this document that are “forward-looking statements”. As these forward-looking statements are predictive
in nature, they are subject to a number of risks and uncertainties relating to Wellington, its operations, the markets in which it
competes and other factors (some of which are beyond the control of Wellington).
All references in this document to $ or “dollars” are references to New Zealand dollars unless otherwise stated.
Wellington’s financial year is 31 December.
02
Business highlights
09-16
About Wellington
03-08
Letter from Chair
and CEO
17-18
Our stakeholders
21-28
Global trends
19-20
Our strategy for growth
31-40
Why do our global
customers love us
43-45
Executive
Management
41-42
Directors
47-84
Financial Statements
91-93
Shareholder informationCorporate governanceContacts
85-88
94-103
89-90
104
Independent Auditor’s
Report
Statutory information
21
Annual Report 2021Annual Report 2021Wellington Drive Technologies Ltd
$64.2m
Revenue
$2.6m
Positive EBITDA
$5.4m
Net profit
$25.2m
Wellington IoT revenue
Wellington Drive Technologies Ltd
When we first developed IoT for commercial
refrigeration, we knew we were on to a good thing.
Fast forward to 2021, we almost doubled our
revenue year-on-year to $64.2 million and are well on
track to becoming a $100 million revenue company
in 2023.
We’re growing into a hardware-enabled, software as
a service (SaaS) provider. It’s our pathway to lifting
recurring revenue, to expanding in existing markets
and exploring new regions around
the world.
The demand for many of our products now exceeds
our supply capability due to global supply chain
issues but this is expected to be a short term
issue. Sustainability, along with other macro trends
like urbanisation, presents tremendous growth
opportunities for us.
Our future is now firmly focused on meeting the
needs of our global customers to deliver cooler
intelligence and a connected advantage.
43
Annual Report 2021Annual Report 2021Wellington Drive Technologies LtdWellington Drive Technologies Ltd
We are extremely pleased to report that Wellington achieved $64.2 million
in revenue and EBITDA of $2.6 million during the financial year ending 31
December 2021 (FY21).
Our EBITDA result is above our initial plan and reflects of our team’s
dedication and commitment to go above and beyond for our customers, as
well as our continuous drive to design and deliver innovative solutions, while
operating in an uncertain and challenging business environment.
We grew revenue 74.1% compared to COVID-affected FY20. FY21 revenue
continued to be constrained by COVID but was nevertheless up 4.0% on our
pre-COVID result in FY19.
The speed at which we’ve rebounded positions us well to deliver the next
phase of our growth strategy. We are on track to solidify our global leadership
in IoT and high-efficiency motors for the commercial refrigeration industry – a
sector worth $11.8 billion globally.
Gross margin was 27.8% for FY21 compared to 28.6% for FY20. To support
the increased demand from customers and to manage significant supply
chain disruption we bought some component parts on the spot market, where
they were not available from regular suppliers, costing an additional $1.1
million. This, along with higher shipping costs, could not always be passed on
and caused some reduction in gross margin this year. We expect this position
to continue into FY22.
Operating costs increased from $11.5 million to $15.1 million reflecting the
restoration of normal remuneration, increased salary levels to assist retention
and additional investment to support business growth. The cost in FY21 also
included the repayment of voluntary staff salary reductions in 2020 amounting
to $1.1 million.
The net profit after tax for FY21 was $5.4 million, this includes a non-cash tax credit of $6.1 million to partially
recognise temporary differences and historic tax losses.
Operating cash flows in FY21 was $4.0 million. Cash on hand increased from $4.6 million at December 2020 to
$6.0 million at the end of FY21. We consider we are adequately funded to execute current business plans.
EBITDA increased from $1.2 million to $2.6 million although the improvement in underlying earnings is not
immediately apparent in these numbers. EBITDA in FY20 benefited from voluntary staff salary reductions, government
wage support payments amounting to $1.1 million and a $1.0 million non-cash income relating to the iPX earn out.
EBITDA in FY21 is after repayment to staff of the 2020 salary reductions and an $0.3 million non-cash charge relating
to the iPX earn out.
Underlying EBITDA after adjusting for these non-recurring items was a $6.1 million improvement over FY20.
Letter from
Chair and CEO
Gottfried Pausch
Chairman
Chief Executive Officer
Greg Balla
$000
20212020
EBITDA as reported2,6261,190
FY20 voluntary staff salary reductions repaid in FY21 1,109(1,109)
Government wage support paid(15)(1,090)
iPX non-cash earn out323(1,016)
EBITDA adjusted4,043(2,025)
65
United States and Canada
Annual Report 2021Annual Report 2021Wellington Drive Technologies LtdWellington Drive Technologies Ltd
Sustainability, along with other macro trends like
urbanisation, presents enormous opportunities for
our business.
Demand for many of our products now exceeds supply.
To meet this growing opportunity, we are investing in our
people and manufacturing capacities with our partners.
We are increasing our research and development
(R&D) effort during FY22. The R&D effort will focus
on redesigning products to work around electronic
component shortages, as well as delivering new
products to market.
As more of our customers see the return-on-investment
(ROI) our IoT technology delivers, we are ready to
expand our offerings to existing customers, as well
as take advantage of the huge retrofit cooler market
worldwide.
For example, in FY 21 a large Australian beverage
customer committed to retrofitting and connecting its
entire refrigeration fleet with us. We are actively working
with several customers to retrofit their fleets.
We estimate that there are 90 million bottle coolers in
operation globally today and the addressable portion is
approximately 30 million coolers. Addressable coolers
are coolers that we have a solution for in a market that is
accessible to Wellington. Today we estimate that two and
a half million of those 30 million coolers are connected to
an IoT platform, one and a half million are connected to
the Wellington Connect IoT platform.
During FY21, we grew the number of refrigeration units
connected to our Connect™ Cloud platform by 42% from
FY20, taking recurring revenue up to $6.8 million.
Revenue grew significantly across all regions, compared
with FY20. This was an exceptional achievement,
set against shipping delays, electronic component
shortages, and other logistic and supply chain issues
that affected our operations.
Our United States and Canada business grew by 41%
on FY20 to $11.0 million, largely due to sales of our
energy-efficient ECR
®
2 motors.
Latin American revenue rose 91% on FY20 to
$40.1 million – mainly attributable to post-COVID
demand recovery but also assisted by the launch of
new products and directing additional resources to the
region to accelerate growth. The LATAM region presents
significant new build and retrofit opportunities for us,
which we will extensively explore in FY22.
In EMEA, revenue grew to $8.2 million, up 77% on
FY20. This stellar result is attributed to repositioning our
high-efficiency motors for supermarket chains.
The revenue in Asia-Pacific grew to $5.0 million, up 41%
on FY20, with our Connect™ IoT solution underpinning
this strong growth.
Wellington’s ongoing success lies in its ability to grow
into a hardware-enabled, full-service SaaS provider.
Our Connect IoT ecosystem is an example of Wellington
at its best. The hardware and software solutions offer
sizeable opportunities for recurring revenue growth, as
we further develop the ecosystem to service existing
markets and exploit new regions including, Europe and
North America.
During FY21, we bolstered our regional teams to
help customers derive value from our Connect IoT
ecosystem. This approach paid off, with a record number
of devices connected in FY21.
FY21 also saw the launch of new products to market,
driven by powerful customer insights. We launched
our new Connect™ Network product, which allows
contactless data uploading. This product gives a
new access point into the North America and EMEA
markets – two key growth regions we are targeting next
financial year.
We are currently validating the product with some
existing large Australian and Latin American clients.
By the end of Q1 FY22, we expect to be ready for pilot
customers in Europe and North America.
We also launched Connect™ Monitor, which will
significantly expand our market reach and access by
easily retrofitting non-connected refrigeration units. It
is compatible with our Connect IoT apps, and other
Connect™ products, and can capture operational data,
offering customers a cloud-based solution to harness
actionable insights.
Global growth achieved in
a challenging landscape
Tipping point for growth
Delivering on our IoT vision
Latin AmericanAsia-PacificEMEA
$11.0m
41%
$40.1m
91%
$8.2m
77%
$5.0m
41%
78
Annual Report 2021Annual Report 2021Wellington Drive Technologies LtdWellington Drive Technologies Ltd
In 2019, we presented our vision to grow revenue to
$100 million by 2023. Despite the disruption caused
by the global pandemic, we remain committed to this
objective.
As we move into FY22, we will re-focus on bringing
new innovative solutions for our customers’ varied
requirements, and most importantly, deliver profitable
growth.
Our evolution into a hardware-enabled SaaS company
is delivering results. In the past financial year, we almost
doubled our revenue to $64.2 million and we expect
continued strong growth in the year ahead.
Revenue is expected to continue growing strongly
in FY22, with the Company forecasting growth of
approximately 25% to around US$60 million. Revenue
would likely be higher than this if there were no
constraints on component supply. The additional gross
profit from this growth is largely being reinvested
back into the expansion of engineering, sales staff
and infrastructure as Wellington broadens its product
and geographic spread. We expect EBITDA in FY22
to be in the range of $4.5 million to $5.5 million
although this forecast result is subject to the Company
successfully navigating the very challenging supply chain
environment present today.
Our team is committed to making a difference with
solutions that reduce energy in refrigeration systems.
Refrigeration and air conditioning use approximately
15% of the global electricity demand. We have
sustainable solutions to help reduce the demand in our
markets. We are actively supporting customers and
working with standard groups to impact change. Our
customers have now installed over three million high-
efficiency motors with energy savings of 2.2TWh to date.
We are also focused on the impact manufacturing our
distributing our products has and we are evaluating
options to reduce our footprint.
The opportunities for growth are strong and our strategy
is focussed on leveraging these opportunities to
maximise shareholder value.
Key to our success will be to successfully completing
the transition from operating as a standalone hardware
company to a hardware-enabled SaaS company.
We are the developers of IoT for commercial refrigeration
and our SaaS ecosystem unlocks recurring revenue
streams as we continue to refine and develop
our world-leading platform to meet the needs of our
global customer base.
We would like to take this opportunity, on behalf of the
Wellington Board of Directors and Executive Leadership
Team, to convey our thanks to every member of our
resilient and innovative team for their dedication during
the last financial year and ongoing.
And to our shareholders, thank you for your continued
support and commitment to the success of the
organisation, we are extremely grateful.
FY22 outlook
Protecting
our environment
Summary
109
Annual Report 2021Annual Report 2021Wellington Drive Technologies LtdWellington Drive Technologies Ltd
About Wellington
We are proud to be a global leader of innovative
hardware and software refrigeration technology, working
with some of the world’s leading food and beverage
companies, to develop solutions that help them increase
sales, reduce costs, and improve sustainability.
Headquartered in New Zealand, with a global footprint,
Wellington is one of the world’s leading suppliers of
energy-efficient motors, refrigeration control solutions
and cloud-based IoT fleet management platforms.
We are the first company to apply IoT technology to
bottle coolers, which delivers integrated cloud computing
into the commercial refrigeration sector. This provides
our customers with valuable business data about the
performance of their refrigeration units, enabling them
to make more informed strategic decisions and
reduce costs.
Our world-leading technology also enables unique
consumer engagement experiences, allowing our
customers to influence their consumers at the point of
decision in new and exciting ways. This helps to build
brand loyalty and offers a strong competitive advantage
in an increasingly competitive retail environment.
As innovators, we are proud to employ some of
the leading minds in refrigeration engineering and
software development who are committed to working in
partnership with our global customers to deliver unique
and tailored solutions, which grow their market share
through innovative technology.
1211
Annual Report 2021Annual Report 2021Wellington Drive Technologies LtdWellington Drive Technologies Ltd
Our innovative hardware and software helps some of the world’s leading food and beverage brands solve complex
business challenges, maximise profits and improve sustainability through customised solutions.
Connect IoT:
Our comprehensive ecosystem of hardware, wireless and digital IoT solutions, Connect IoT, brings world-leading
technology to commercial refrigeration, helping food and beverage manufacturers better manage their refrigeration
assets, reduce costs, increase sales, and provide valuable data which informs better business decisions.
ECR motors:
Our ECR technology provides our customers with energy-efficient refrigeration motors paving the way in sustainability.
With our ECR 2 motors proven to be up to 99.97% reliable and at only 36.5 dBA, they are among the quietest motors
in the industry with operational efficiency of up to 70%.
Consumer Engagement:
Our world-leading iProximity consumer engagement technology combines the latest location-based IoT devices,
smartphones and our powerful iPX™ Cloud platform. It allows our customers to deliver new, exciting communications
solutions, which improve their consumer engagement at the point-of-sale (POS), helping to influence purchasing
decisions and drive sales.
Our solutions
Monitor
Connect
ECR 2
motor
iPX
Cloud
platform
1413
Annual Report 2021Annual Report 2021Wellington Drive Technologies LtdWellington Drive Technologies Ltd
We never compromise on quality. We are committed
to being the global leader in the delivery of high-quality
refrigeration solutions and services.
Our flexible solutions, which are easily installed and
commissioned, are manufactured by our partners in
Vietnam. We are exploring opportunities to manufacture
in the Americas, closer to our customers.
All our factories are ISO9001 certified, and we closely
supervise the process and quality control across
our manufacturing facilities. We maintain direct and
strong relationships with our key component suppliers.
These relationships served Wellington well through the
pandemic and helped us navigate the challenges of
supply chain disruptions.
We know that reliable refrigeration services are critical.
That is why we test our products intensively, in both the
development and production phases. All our products are
tested at extreme abuse levels during development and
are validated using accelerated life testing. We conduct
continuous production sampling and testing to ensure all
our products continue to perform in the way intended.
Leading manufacturing, quality,
and reliability
1615
Annual Report 2021Annual Report 2021Wellington Drive Technologies LtdWellington Drive Technologies Ltd
Our continuous commitment to success means
continuing to deliver innovative solutions that exceed
customer expectations, increase sales, and reduce
costs. That is why our customers are at the centre of our
ongoing R&D programme.
Our multi-disciplinary R&D team – based in New
Zealand – works in partnership with our customers
and their manufacturing partners, to develop the best
outcomes. In each region we also have teams of field
engineers based in each region, who work very closely
with our customers.
Our R&D hub is equipped with a highly accelerated life
testing (HALT), environmental chambers, airflow test
chambers, dynamometers, electromagnetic compatibility
testing facilities, a fully equipped toolroom and the ability
to build printed circuit board assemblies.
We are enormously proud of the Wellington team
which includes some of the world’s leading refrigeration
engineers and developers. Our team includes hardware,
software, mechatronics, refrigeration, manufacturing,
and quality engineers. Our expertise of motor control
systems and refrigeration offers us a strong advantage
against our competitors.
Our commitment is to exceed our customer’s
expectations, every time.
We partner collaboratively with our customers, to
deliver uniquely specialised solutions through a highly
personalised service that directly focuses on saving
our customers time, money and helping them gain a
competitive advantage in a crowded market.
As industry specialists, we understand the importance of
a strong global supply chain. We know how critical “on
time” delivery is to production. During FY21, despite the
ensuing components and materials shortages, caused
by the pandemic, our supply team was relentless in
the pursuit of components. Meeting customer demand
incurred an additional cost of $1.1 million for spot market
component buying.
We also understand the challenges of building products
in a manufacturing environment and so we design our
products to be flexible, easy to install and commissioned,
and to minimise the required stock keeping units (SKUs)
in inventory.
Our commitment to continued
innovation
Uncompromising customer
service
1817
Annual Report 2021Annual Report 2021Wellington Drive Technologies LtdWellington Drive Technologies Ltd
We pride ourselves on building strong and enduring relationships with our customers, partners, investors, and staff
because we know that our continued success is dependent on strong partnerships.
We believe our success in building mutually beneficial relationships is the result of focussing on the things our
stakeholders care about – using innovation to solve complex problems that result in increased sales, reduced costs
and improved sustainability.
We believe our investors share our view that there
are immense opportunities for growth as we continue
to innovate and drive change within the commercial
refrigeration sector.
We are committed to maximising shareholder return and
take advantage of these opportunities. Our partnerships
with some the world’s leading food and beverage
companies, such as Coca-Cola, PepsiCo, AB InBev
and Heineken position us exceptionally well as a global
leader in innovation for commercial refrigeration, drive
growth and deliver returns to our investors.
We are committed to continue providing our investors
with balanced, clear and transparent information,
allowing them to make informed decisions about their
investments.
Our business requires smart and skilled people to deliver
success. We know that our continued success relies on
our ability to attract and retain the highest-quality talent.
We have a global team of 89 comprising leading
innovators in hardware, software and digital product and
solution technology, with specialist knowledge in IoT
devices.
Our advantage is that our team have a common
passion for technology and shared learning. We are
all committed to collaborating with our customers and
suppliers to develop innovative solutions to complex
problems.
During the period, David Burden accepted the position of
Chief Customer Officer to lead our team in implementing
our growth strategy. David has extensive experience
in using technology to deliver innovative solutions for
customers. David commenced leading our global sales
and marketing teams, taking over from Steve Hodgson
who worked with us for many years, and we would like
to thank Steve for his service and commitment to
the organisation.
In an increasingly competitive employment market, we
know we need to continually enhance the employment
experience to remain an employer of choice. We have
employed a head of people and culture to ensure we
are at the forefront of delivering the best employee
experience to our team.
Our new Chief People Officer, Angela Lewis, came on
board at the very end of the year. Bringing her wealth of
expertise from working in large corporates, Angela will
lead and drive our people-led initiatives, talent retention
strategies, and evolve the employee value proposition
(EVP) offering.
In November, we welcomed Laura Bocock into the
newly created role of Transformation Lead. Laura is
leading initiatives that are focused on helping us scale
productively and increasing the speed at which we
deliver high-value innovative solutions to our customers.
East West Manufacturing
East West Manufacturing is our global manufacturing and supply chain partner,
specialising in motor mechanical assembly, plastics design, injection moulding and
integrated electronics manufacturing services.
In January 2022, East West acquired Compass Electronics Solutions, which will
provide Wellington the opportunity to manufacture with East West in the North
American market to better service our customers in the region.
Our partners and distributors
Investors
Our team
Our stakeholders
2019
Annual Report 2021Annual Report 2021Wellington Drive Technologies LtdWellington Drive Technologies Ltd
The opportunities for growth are strong and our strategy
is focussed on leveraging these opportunities to
maximise shareholder value.
In 2019 we presented our Vision 2023, with the aim of
achieving $100 million in revenue by 2023. Despite the
disruption caused by the global pandemic, we remain
committed to achieving this objective.
The key to our success will be continuing the successful
transition from operating as a hardware company to a
hardware-enabled SaaS company. We are the leaders in
IoT for commercial refrigeration and our SaaS platform
presents an enormous opportunity for recurring revenue
growth as we continue to refine and develop our
world-leading platform to meet the needs of our global
customer base.
This transition is already delivering results and we expect
expect continued strong growth in the year ahead. This
comes on the back of continued customer demand
for high-quality insights which enables more informed
business decisions.
The three key planks of our business strategy are:
1. Increasing market share of new coolers and
retrofitting existing coolers
There are approximately 30 million bottle coolers
globally and about two and a half million are
connected to a platform. Working with food and
beverage manufacturers to retrofit their existing
coolers is a key way we expect to grow our market
share.
We also have a clear opportunity to connect to
a higher proportion of the nine million new bottle
coolers manufactured each year. Currently we sell
approximately half a million controllers each year,
meaning there is a significant untapped market.
2. Accessing new regions
We will focus our efforts on not only growing our
market share within existing markets, but also
markedly increasing our presence in markets that
provide robust growth opportunities. We plan to
increase the presence of our IoT ecosystem in
EMEA and North America. Our newly released
products Connect Monitor and Connect Network
allow us to provide solutions that are suitable for
these markets.
3. Launching new verticals
We will use our software and engineering expertise
to launch a range of new products that meet the
needs of the various parts of the food and
beverage sector.
We will take advantage of the growing demand for
data by using our expertise in IoT to connect a wider
range of assets to our Connect IoT platform.
Our strategy
for growth
2021201920182020
COVID-19 impactedCOVID-19 impacted
New coolersNew regionsNew verticals
$58.8m
Revenue
$61.7m
Revenue
$36.9m
Revenue
$64.2m
Revenue
2221
Climate change remains one of the world’s greatest challenges. Last year’s United Nations Climate Change
Conference (COP 26) in Glasgow saw countries pledge further cuts in emissions to limit temperature rises.
At the same time, some of the world’s largest food and beverage companies have pledged to cut emissions. Among
them, are two of our customers – Coca-Cola Europacific Partners (CCEP), a major Coca-Cola bottler, which has
committed to achieve net zero emissions by 2040; and Heineken has committed to 100% of its coolers being in the
top efficiency class by 2027.
As governments and companies start looking at how they can achieve their emissions pledge, we believe we have a
vital role to play in helping the food and beverage sector significantly improve its energy efficiency.
Refrigeration is a significant user of electricity, which is still largely generated by fossil fuel in many parts of the world.
Our highly energy-efficient ECR 2 motors and our Connect IoT ecosystem, which provides in-depth data on energy
use, provide a distinct competitive advantage in the refrigeration market, and allows us to work proactively with leading
manufacturers to help them achieve their emissions targets.
Mexico’s largest food and drink company, GEPP, is an example of this commitment to emissions reduction, winning
the Wellington Sustainability Award in 2021 for its achievements. After installing our ECR 2 motor into its 126,000
stores, GEPP’s customers reported a saving of NZD$105.8 million on electricity costs. This is the energy-saving
equivalent of 37,343 car trips around the world
1
.
1
Comparative statistics sourced via https://www.epa.gov/energy/greenhouse-gas-equivalencies-calculator and https://yearbook.enerdata.net/
electricity/world-electricity-production-statistics.html
We live in a rapidly changing world.
Countries continue to grapple with the social and economic impacts of a global pandemic, there is a heightened
urgency to act on climate change, populations are growing and urbanising fast, and our economies are digitising at an
unprecedented pace.
These changes, however, present huge number of opportunities for adaptable flexible, and innovative companies such
as ours. We believe our focus on innovation and the development of new products and services will allow us to grow
rapidly as we continue to provide unique solutions to our customers.
Annual Report 2021Annual Report 2021Wellington Drive Technologies LtdWellington Drive Technologies Ltd
Global trends
Climate change
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The world population continues to grow rapidly and urbanise, particularly in
Asia, the Middle East and Central and South America. These regions are
also home to some of the world’s fastest growing economies with a rapidly
expanding middle class.
Increasing urbanisation and growing wealth is driving a modernised retail
sector and increased demand for refrigeration, with consumers demanding
access to chilled fresh produce, frozen food and chilled drinks.
Our presence in Latin America, the Middle East and Asia means that we can
take advantage of this growing market as we leverage the strong partnerships
we have built over many years.
Urbanisation and
demographic changes
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The global economy continues to digitise at an unprecedented rate, and the
pandemic is only accelerating this process. Increased digitisation brings a
growing expectation from companies that they can capture accurate data in
real-time to help inform their business decisions.
This means there is growing demand for IoT technology, with a recent survey
finding 79% of organisations were planning to invest significant capital into IoT
over the next two years. While research firm IDC predicted that more than 50%
of global data generated will come from IoT devices by 2025.
As the inventors of IoT in bottle coolers, we stand to benefit from this
investment and growth. Our Connect IoT ecosystem provides food and
beverage manufacturers with sophisticated real-time data, giving us a distinct
competitive advantage in the refrigeration market.
Digitisation
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At Wellington, we are proud to be partnering with some
of the world’s leading food and beverage manufacturers,
helping them to improve their energy efficiency, reduce
their carbon footprint and meet their sustainability goals.
From protecting the food supply to ensuring medicines
remain safe, refrigeration systems are increasingly
critical in the modern world. But refrigeration is also
energy intensive, with the International Institute of
Refrigeration estimating about 15% of the world’s
electricity is used to drive refrigeration and air-
conditioning systems
2
.
At the same time, the International Energy Agency (IEA)
says rapid increases in electricity demand is putting
power systems under strain and pushing power prices
and emissions to record levels
3
.
For the world to meet its climate change goals, with more
than 130 countries pledging or considering reducing
emissions to net-zero by 2050, emissions from electricity
need to decline. This means we need to be using
electricity more efficiently in all parts of the economy.
This presents an enormous opportunity for Wellington,
as companies actively seek energy-efficient solutions
for their refrigeration systems. We are committed to
leveraging this opportunity through ongoing innovation
and partnerships to help our customers develop more
energy-efficient solutions, as well as continuing to deliver
the highest standards of refrigeration.
Our energy-efficient motors, such as the ECR 2 motor,
significantly reduces energy consumption in beverage
coolers and vending machines by switching the fan to
low speed when the compressor is not operating. The
ECR 2 has an efficiency of up to 70% and a power factor
of 0.95. Traditional motors are only 18-22% efficient,
often with a power factor of less than 0.5. This means
our motors are over 300% more energy-efficient than
traditional motors.
A trial at a major supermarket chain found that replacing
older induction motors with our ECR 2 reduced energy
usage by 84% and delivered an ROI in less than a year.
Since the launch of our ECR 2 motor in 2016, more than
three million motors have been produced and installed
around the world. It is these kinds of innovations that
have seen our energy-efficient technology save over
20.5 TWh of energy since we started Wellington –
enough energy to power the entire world for 7.4 hours –
leading to a reduction in carbon emissions of 14.5 million
metric tonnes
4
.
We are proud that our environmental and sustainable
record was recognised by the Silver Medal by EcoVadis,
which places us in the top 20% of companies worldwide.
Sustainability
How we worked with Mexican food and beverage giant GEPP to
save energy and cut their carbon footprint
With coolers located in 126,000 stores across Mexico, GEPP is one of Mexico’s
largest beverage companies.
With the support of Wellington, GEPP commenced installing our ECR 2 motor
technology into their coolers and as a result was able to reduce its carbon
footprint by 369,933 tCO
2
, driven by an 824 GWh power saving
5
. This has saved
GEPP’s customers NZD$105.8 million in electricity costs.
2
https://iifiir.org/en/fridoc/how-to-improve-energy-efficiency-in-refrigerating-equipment-124004
3
https://www.iea.org/reports/electricity-market-report-january-2022
4
Comparative statistics sourced via https://www.statista.com/statistics/280704/world-power-consumption/
5
Comparative statistics sourced via https://www.epa.gov/energy/greenhouse-gas-equivalencies-calculator and https://yearbook.enerdata.net/
electricity/world-electricity-production-statistics.html
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• Track the location of all field
equipment.
• Reduce equipment loss.
• Minimise CAPEX spend on new
equipment.
• Optimise cooler replacement
cycle based on actual
equipment condition.
A customer reclaimed over 45% of
their lost coolers after adopting the
Connect
TM
Track app.
Asset
management
One Wellington customer reduced
their average service cost by about
50%. Savings came from faster
diagnostics, accurate early fault
identification, and better first-time
fix rate.
• Verify equipment operation.
• Remote diagnostics reduce
downtime and prioritise issues.
• Easy tools simplify
troubleshooting and service in
the field.
• Operational data identifies
problem areas, reducing service
costs.
• Improve scheduling of
preventive maintenance.
Technical
performance
A customer reviewed their
equipment fleet in different channels
after analysing the data and
determining that over 50% of their
coolers were turning over less than
10% of their capacity per day.
• Maximise equipment ROI by
understanding activity at each
point of sale.
• Identify assets that aren’t
paying for themselves and right
size them.
• Upsize equipment to capture
unmet demand and increase
revenue.
Commercial
performance
A customer reduced their servings of
product that were out of temperature
spec across the fleet from 15% to
just 2% by identifying overnight
cooler switch offs and correcting the
retailer’s behaviour.
• Identify case contamination and
undesirable retailer behaviour.
• Support sustainability
initiatives by minimising energy
consumption while ensuring
product temperatures are safe
and desirable.
• Be alerted to potential product
quality/HACCP issues.
• Better justify future CAPEX
investments with performance
data for each asset.
Operations
management
Engage your customers by
dynamically sharing planograms,
new programs, and sales specials
with digital, on demand technology.
• Easily communicate
planograms, sales specials and
new programs.
• Dynamically update information
anytime with field trips or added
cost.
Customer
engagement
One customer increased sales by
114% over a 6-week promotion
that focused on new consumer
engagement at the POS equipment.
• Connect with consumers at
the POS with access to special
promotions.
• Influence decisions with
customisable content.
• Build loyalty with unique
experiences.
Consumer
engagement
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Our cutting-edge IoT technology is supporting some of
the world’s leading food and beverage manufacturers
to better manage their refrigeration assets in a range of
ways. Our solutions help improve maintenance efficiency
and servicing, reduce asset losses and save money for
our customers around the world.
Beverage manufacturers and bottlers are often required
to place commercial refrigeration assets (coolers) at
the POS. This wide distribution of refrigeration assets,
and the loss of direct control, means manufacturers can
suffer high rates of asset loss through misplacement,
theft, or poor compliance.
For example, a recent survey of our Latin American
beverage customers found the rate of loss was between
3% and 7% of their total cooler fleet annually. For an
average bottler, with a fleet of 60,000 coolers, this could
mean up to 4,200 coolers lost every year. Given the
average cooler costs $US500, this represents an annual
expenditure impact of USD$2.1 million.
Through the development of our leading Connect IoT
ecosystem, we can support our customers to actively
monitor their field equipment and reduce equipment
loss. Our IoT technology allows for ongoing passive
data acquisition and has geolocation capability. This
means manufacturers can monitor the precise location
and performance of each cooler; and our customers
can improve their cooler replacement cycle, reduce the
number of lost coolers and make better use of
capital budget.
How we helped one of our customers
recover 40% of their lost refrigeration
assets
A bottler in Latin America recently sought our help to
recover lost or stolen refrigeration assets.
The lost assets were written off and the company was
preparing to invest two to three times the book value of
these assets for replacement units.
They previously installed our Connect SCS electronic
controllers into many of their new build coolers, which
logs and stores operational and geolocation data.
With our support, the company implemented a cooler
collection plan, integrating our data acquisition software
into its own app. This allowed their commercial team to
collect the precise location and asset number of coolers
in the field.
After several months of data collection, an internal
control list was generated to identify the number and
precise location of the lost coolers. The company could
then launch a recovery operation to collect the lost
coolers. This resulted in the bottler recovering 40% of
its lost or stolen coolers, reducing capital spend and
delivering a ROI from our technology within two years.
Asset management
Why do our global
customers love us?
Return-on-investment period over total cooler connectivity investment
6
(investment to connect entire fleet)
6
Graph sourced from Wellington White Paper, How an investment in IoT for the field refrigeration fleet recovered 40% of lost assets and achieved
ROI (USD)ROI %
-$1,000,000
-100%
-100%
-47.92%
-$900,000
-$441,600
$475,200
$16,800
0123
1.78%
49.25%
-120%
-$800,000
-80%
-$600,000
-60%
-$400,000
-40%
-$200,000
Investment
%ROI
Years
-20%
$0
0%
$200,000
20%
$400,000
40%
$600,000
60%
ROI in less than two years https://www.wdtl.com/resources/white-papers/
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We pride ourselves on developing tailored and innovative technology solutions
which improve the technical performance of our customers’ refrigeration units.
Food and beverage manufacturers must have confidence that their
refrigeration units are performing to the highest standards to ensure product
safety and to identify issues early.
Our globally leading IoT technology helps them to do this by verifying the
operation of their refrigeration equipment. Our technology allows remote
diagnostics, simplified troubleshooting and the improved collection of
operational data.
This helps our customers identify, then rectify issues quickly, to avoid or
minimise any potential loss of stock, due to temperature changes.
Our Connect™ Field app allows service technicians to connect to a cooler via
Bluetooth, displaying error flags and identifying issues. Our system also allows
the control of individual relays to check component operation and download
months of cooler data to a Smartphone. Technicians can then diagnose a
situation based on accurate information and real-time data, removing any
guess work.
This technology saves our customers money in unnecessary servicing costs.
For example, after implementing our Connect IoT ecosystem, one of our
customers halved its average service costs by providing faster diagnostics,
improving fault identification accuracy and delivering a better first-time fix rate.
Technical performance
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Our Connect IoT technology helps our customers to make the best use of their
refrigeration units, ensuring they have the right units at the right location to
meet demand and maximise sales.
Commercial refrigeration and coolers are a significant capital expense for food
and beverage manufacturers, and it is crucial that this investment delivers
maximum return.
By implementing our Connect IoT ecosystem, our customers collect a wide
range of business intelligence that tells them if a unit is over or undersized for
every single POS.
Unlike other options available, our technology allows our customers to identify
where assets might need to be upsized to capture unmet demand. As a result,
our technology is allowing customers to maximise the ROI of their coolers.
Commercial performance
Wellington’s Connect IoT technology allowed a customer to review its
equipment fleet in different channels.
After analysing the data, we discovered more than 50% of the coolers were
turning over less than 10% of their capacity per day.
Understanding this, enabled the customer to begin swapping these
underperforming units for smaller, more efficient units, resulting in
significant savings.
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Our Connect IoT ecosystem provides our customers
with critical insights into the field operation of their
commercial refrigeration and cooler units.
In turn, this helps our customers to improve
sustainability, identify case contamination and reduce the
risk of undesirable retailer behaviour.
For example, our Connect SCS is a sophisticated
smart controller that provides voltage and current
measurements, allowing our customers to report the real
energy usage across its fleet.
This also enables easy identification of when a retailer
might turn a cooler off overnight in the mistaken belief
this will save electricity, which can impact product quality
and result in food safety issues.
Our “always-on” technology means our customers are
alerted when equipment is unloaded and can track
product reloads, identify unauthorised products being
placed into a cooler. This allows prompt action to help
adjust retailer behaviour.
With our support, we helped one of our customers
reduce the number of coolers selling out-of-temperature
products from 15% to just 2% of its fleet by allowing
them to identify and rectify overnight cooler switch
offs. Cooler operating temperatures are critical to our
customers’ product sales and coolers operating
correctly will have up to 55% higher product sales than
warmer coolers.
Operations management
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Providing actionable insights for our
customers
We are committed to making life easier for our
customers, as well as for our customers’ customers.
We believe in the power of our IoT technology to help
achieve this.
By working in partnership with food and beverage
manufacturers, we continue to develop innovative and
leading solutions that provide our customers with the
competitive edge required to gain retail floor space in an
intensely competitive market.
As our Connect IoT ecosystem easily integrates with
different platforms, we can place a world of data at the
fingertips of sales teams – including detailed product
information and energy efficiency.
This helps empower our food and beverage customers
to engage with retailers and others in evidence-based
conversations, allowing them to easily demonstrate the
value and profitability of their refrigeration unit.
Our software technology solutions allow our customers
to engage with their consumers in new and exciting
ways, helping to increase sales and build brand loyalty.
Through our “always-on” technology, we can support
our customers to better control the brand experience,
offer personalised promotions to consumers and digitally
engage with individualised consumers, helping to
influence purchasing decisions.
Our iProximity engagement platform, for example, allows
customers to connect with consumers at the POS, giving
them access to special promotions. Customers can also
make use of our interactive ScreenSmarts solution to
integrate customised, interactive digital signage into food
and beverage coolers.
In a retail environment that is increasingly digitised and
connected. The ability to engage with consumers at
the POS can be a powerful point of difference, allowing
brands to engage directly with their consumers at the
right time to drive sales.
An example of the power of our Connect IoT ecosystem
to drive sales is when one of our customers, returned an
increase in sales of 114% during a six-week promotion
that focussed on new consumer engagement at the POS
using our technology.
Customer engagement
Consumer engagement
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Directors
Gottfried Pausch
Executive Appointment and
Remuneration
Audit and Risk
Chairman | Independent Director
Gottfried Pausch is an independent
director of McKay Ltd and
Blackhawk Tracking Ltd. Gottfried
holds an electrical engineering
degree from Austria and a Master’s
degree in Business Administration
from Duke University in the USA. He
is a director for one of the National
Science Challenges, an initiative of
the Ministry of Business, Innovation
and Employment (MBIE). Gottfried
was the former CEO at Actronic
Technologies, Executive Chairman
at AuCom Electronics, Chairman of
Invert Robotics - all companies with
New Zealand based engineering,
manufacturing and global sales &
service networks and an executive
in residence at The Icehouse. This
followed a 22-year career with
German engineering and electronics
conglomerate Siemens, one of
the world’s leading suppliers of
products, solutions and services in
the field of technology. During this
period, he held the positions of CEO
Siemens Energy Services Ltd and
managing director of Siemens New
Zealand.
John Scott
Independent Director
John Scott is CEO for Invenco,
a world leader in payments and
forecourt solutions (fintech and
IoT) in the petroleum space.
He has previously had a range
of c-suite roles across sales,
marketing, operations and
product management with Navico,
Brunswick and Navman. John
also had business development,
engineering and project engineering
roles with Ericsson/Volex
(communications). He graduated
from the University of Auckland in
1997 with a Bachelor of Engineering
(BE Mech). John has 20 years of
global experience in managing
large multilocation go-to-market,
operations and design teams – with
deep pricing experience across
all channels and markets. He has
been actively involved in multiple
acquisition events and fundraising
activities. John has an in-depth
knowledge of the rapidly developing
dynamics of global electronics
supply, big data and IoT growth
opportunities, and has operating
experience in the Asian, European
and North American markets.
Greg Allen
Director
Based in Vancouver Canada,
Greg Allen is the former CEO
of Wellington and has worked
around the world leading business
development, supply chain and tech
manufacturing for over 30 years.
Greg provides Wellington with the
benefit of his international customer
and corporate development
expertise as the Company continues
to focus on providing the best
solutions for the global food and
beverage market. Greg is currently
a Venture Partner for Chrysalix
Venture Capital, a global venture
capital fund focused on industry
4.0, climate technology and
resource productivity. In addition,
he serves as Board Chair of HaiLa,
a Canadian-based low-power Wi-
Fi solutions start-up; is a board
observer for Feasible, a US-based
EV battery intelligence company;
and is a member of the Economic
Advisory Committee for the City of
Richmond, British Columbia. Greg
gained his education in radio and
electronics in the New Zealand
Army, holds an MBA from Edinburgh
Napier University and holds the
Canadian Institute of Corporate
Directors ICD.D professional
designation.
John McMahon
Audit and Risk (Chair)
Independent Director
John McMahon has over 30 years’
experience in the Australasian
equity markets, predominantly
as an equity analyst covering
the telecommunications, media,
gaming, transport and industrials
sectors. Previous roles include
Head of Research and Head
of Equities for ABN AMRO NZ
and Managing Director of ASB
Securities. John is a director and
Chair of Solution Dynamics Ltd
(SDL) and was also a director of
NZX Ltd (NZX) until 31 December
2021. He holds a Bachelor of
Commerce (Honours), an MBA
and is a CFA (Chartered Financial
Analyst) charter holder.
Keith Oliver
Executive Appointment and
Remuneration (Chair)
Audit and Risk
Independent Director
Keith Oliver was appointed a
director of Wellington in March
2019. He is also an Independent
Director at Rakon Limited,
Chairman of Blackhawk Tracking
Limited and since 22 July 2021
he has been a director at VWork
Limited. He has over 20 years’
experience in CEO, director
and chairman roles, and has
extensive experience expanding
technology businesses in USA,
South America, Europe, Asia and
Australia. Keith was Chairman of
Actronic Technologies for 10 years,
and Chairman of Compac Sorting
Equipment Limited, where he also
held leadership and board director
roles. He has Crown company
governance experience in science
and health, having worked as
a Director of New Zealand’s
Institute of Environmental Science
and Research Limited (ESR).
Prior to his governance roles,
Keith had a 20-year career in
telecommunications, broadcasting,
strategic planning and private
equity investment in New Zealand,
Australia and Europe.
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Executive management
Greg Balla
Chief Executive Officer
Greg Balla was appointed CEO of Wellington in May 2021. He comes with
over 18 years of strong leadership experience in large complex organisations
including technology and manufacturing across a range of sectors including
industrial, healthcare technology, mining, pharmaceuticals and electrical
products. Greg’s extensive commercial skills spans government contracts, large
supplier agreements, distribution management, pricing and contract negotiation.
He also possesses extensive change management experience in multiple
sectors as well as in depth experience in implementing management operating
systems to drive strategic deployment and organisation visibility. Greg’s most
recent role was as Chief Operating Officer for Orion Health, a global health
technology company.
Angela Lewis
Chief People Officer
Angela Lewis joined Wellington in January 2022. She leads leads our people
focused initiatives as we continue to develop a vibrant culture with modern
thinking and ways of working while supporting the retention of our existing
talent and helping to attract the best future talent. Angela was previously the
Head of HR consulting at Coca-Cola Amatil (NZ) Ltd and has significant people
leadership experience from her career, including organisations such as Amazon,
Orion Health and Walt Disney.
Howard Milliner
Chief Financial Officer
Howard Milliner was appointed as CFO in November 2012. He oversees all
financial and administrative operations and helps to shape the overall strategy
and direction for the company. He holds a BCom from the University of Auckland
and is a chartered accountant, with accounting experience gained working for
Ernst & Young London. For 14 years he held both CFO and CEO roles for NZ-
listed engineering business, Mercer Group (now MHM Automation). Howard has
extensive experience in managing financial operations and business acquisitions
and divestments.
Marc Tinsel
Vice President, Supply Chain, Operations and GM Engineering
Marc is responsible for Wellington’s day-to-day leadership, supply chain and
operations, as well as delivery of all hardware, software and development
programs. He joined Wellington in 2013 as Programme Manager for sustaining
engineering, was promoted to Head of Manufacturing in 2015 then Vice
President, Supply Chain and Operations in January 2019 and in November 2020
his job responsibilities were also extended to engineering. Prior to Wellington, he
worked as a Project Manager for Electrix, managing multiple projects, budgets
and multidisciplinary teams. Marc was also employed by electrical safety
compliance testing laboratories based in Auckland and London for 13 years.
David Howell
Chief Technology Officer
David is currently Chief Technology Officer and has a strategic technology
leadership role that includes conception of the technology plan, taking a lead role
in technology and partnership acquisition, as well as exploring and implementing
new technology models. David joined Wellington as Engineering Manager in
1999. He has previously worked in new product development roles for Rover
Group (UK), Fisher and Paykel Healthcare Corporation Ltd and Tru-Test Ltd. He
is listed as inventor on 14 families of international patent applications, including
several of Wellington’s core motor patents.
David Burden
Chief Customer Officer
David Burden joined Wellington in 2018 as part of the iProximity acquisition,
initially in the role of Vice President Group Marketing and IoT products and in
December 2021 he was promoted to Chief Customer Officer. He is an Australian
entrepreneur with 30 years of experience in leading start-ups and successful
technology businesses. He founded and led what became Australia’s largest and
best-recognised interactive and mobile services company, Legion Interactive.
In 2008, he joined the ASX-listed digital media company Webfirm Group (now
Adslot) as group CEO. Within three years he took it from a valuation of AUD$2m
to a peak of AUD$120m. In December 2013, David and Rohan Lean established
an exciting new IoT company, iProximity, with a focus on proximity marketing and
digital information services. iProximity was acquired by Wellington in July 2018.
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Executive management
Beatriz Mibach
Vice President, Global Product Management
Beatriz Mibach joined Wellington in February 2020 as Global Head of Products,
where she leads the product management process from concept through
to customer delivery. Beatriz has 15 years’ experience across research,
engineering, product management and innovation for leading global companies.
She has previously held vice president roles for engineering and sales at Lancer
Corporation and worked as the equipment development manager at Coca-Cola
in Europe.
Laura Bocock
Transformation Lead
Laura Bocock joined Wellington in November 2021 as Transformation Lead,
where she leads a portfolio of activities that re-invent the way we do things at
Wellington. These support our customer centric focus, expanding lean/agile tools
and using data led insights to develop a continuous improvement and innovation
mindset. Laura enjoys a challenge and strives for great outcomes for people
and organisations. She has over 12 years’ experience across a breadth of skills
including lean six sigma and agile, software development delivery, emergency
management, change leadership, program management, analysis, training, and
collaborative engagement.
Prior to starting at Wellington, Laura was Planning and Intelligence Manager,
COVID Response Unit at Auckland Regional Public Health Service.
Peter Barnes
Global Quality Manager
Peter Barnes is currently Global Quality Manager, responsible for product
quality, quality improvement and all Company processes and procedures. Peter
joined Wellington in 2003 as a senior electronic design engineer. He held many
positions within the engineering team before changing his career direction and
moving into quality management. Prior to starting at Wellington, Peter worked at
a start-up company as a design engineer, developing various water temperature
control valves for domestic and industrial applications.
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Financial Statements
Consolidated Statement of Comprehensive Income
20212020
Note$000s$000s
Revenue2.264,21836,880
Cost of sales(46,345)(26,332)
Gross profit17,87310,548
Other income2.31281,156
Operating expenses2.4(15,052)(11,530)
(Loss) / gain on remeasurement of contingent
consideration
6.1b(323)1,016
Earnings before interest, taxation, depreciation,
amortisation & impairment
2,6261,190
Depreciation3.2(578)(641)
Amortisation3.3(2,015)(1,686)
Impairment3.3(393)(456)
(Loss) before interest & taxation(360)(1,593)
Finance income4.2117
Finance expenses4.2(207)(389)
(Loss) before income tax(556)(1,975)
Income tax credit / (expense) 2.5a5,981(179)
Profit / (loss) for the year5,425(2,154)
Other comprehensive income:
Items that may be reclassified subsequently to the
profit or loss:
Exchange differences on translation of foreign
operations
4.5b117(1,565)
Other comprehensive income / (loss) for the year117(1,565)
Total comprehensive income / (loss) for the year5,542($3,719)
Profit / (loss) for the year attributable to the Owners
of the Company
5,425(2,154)
Total comprehensive income / (loss) attributable
to the Owners of the Company
5,542(3,719)
Basic earnings per share – cents2.61.26(0.58)
Diluted earnings per share – cents2.61.23(0.58)
The above Consolidated Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
Consolidated Statement of Movements in Equity
for the year ended 31 December 2021
2021
Note
Contributed
equity
$000s
Accumulated
losses
$000s
Other
reserves
$000s
Total
equity
$000s
Balance at 1 January 2021135,555(116,892)(3,948)14,715
Comprehensive income
Profit for year-5,425-5,425
Other comprehensive income
Exchange differences on translation of
foreign operations
4.5b--117117
Total comprehensive income-5,4251175,542
Share option compensation expensed4.5a--3131
Balance at 31 December 2021$135,555($111,467)($3,800)$20,288
2020
Note
Contributed
equity
$000s
Accumulated
losses
$000s
Other
reserves
$000s
Total
equity
$000s
Balance at 1 January 2020130,228(114,738)(2,383)13,107
Comprehensive income
Loss for year-(2,154)-(2,154)
Other comprehensive income
Exchange differences on translation of
foreign operations
4.5b--(1,565)(1,565)
Total comprehensive income-2,154(1,565)(3,719)
Contributions of equity, net of costs4.35,327--5,327
Balance at 31 December 2020$135,555($116,892)($3,948)$14,715
The above Consolidated Statement of Movements in Equity should be read in conjunction with the accompanying notes.
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Consolidated Statement of Financial Position
as at 31 December 2021
Note
2021
$000s
2020
$000s
Current Assets
Cash and cash equivalents3.1a5,9534,610
Trade and other receivables3.1b17,8478,624
Inventories3.1c4,6003,417
Total current assets28,40016,651
Non-Current Assets
Property, plant and equipment3.21,7242,083
Deferred tax asset2.5b6,051-
Intangible assets3.312,61912,397
Total non-current assets20,39414,480
Total assets48,79431,131
Current Liabilities
Trade and other payables3.1d19,1679,872
Contract liability2.21,4311,044
Provisions3.1e205315
Derivative financial instruments6.421-
Borrowings4.1731863
Total current liabilities21,55512,094
Non-Current Liabilities
Borrowings4.11,2661,170
Contract liability2.25,3623,152
Contingent consideration6.1b323-
Total non-current liabilities6,9514,322
Total liabilities28,50616,416
Net assets$20,288$14,715
Consolidated Statement of Financial Position - continued
as at 31 December 2021
Note
2021
$000s
2020
$000s
Equity
Contributed equity4.3135,555135,555
Accumulated losses4.4(111,467)(116,892)
Other reserves4.5(3,800)(3,948)
Total equity$20,288$14,715
For and on behalf of the Board
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
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Director
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Wellington Drive Technologies Ltd
Consolidated Cash Flow Statement
for the year ended 31 December 2021
Note
2021
$000s
2020
$000s
Cash flows from operating activities
Receipts from customers exclusive of GST/VAT57,99341,531
Payments to suppliers and employees exclusive
of GST/VAT
(54,861)(42,606)
Other income2.31281,156
Interest paid(204)(404)
Interest received4.2117
Taxation (paid) / received(31)13
Net GST/VAT received911643
Net cash inflow from operating activities6.7a3,947340
Cash flows from investing activities
Payments for property, plant and equipment3.2(134)(210)
Payments for intangible assets3.3(2,089)(3,153)
Net cash outflow from investing activities(2,223)(3,363)
Cash flows from financing activities
Cash proceeds from ordinary shares4.3-5,327
New loans and drawdowns4.12,0717,240
Loan repayments4.1(1,902)(8,019)
Finance lease borrowing-27
Principal payments for right-of-use assets6.5(217)(193)
Net cash (outflow) / inflow from financing activities(48)4,382
Net increase in cash and cash equivalents1,6761,359
Cash and cash equivalents at the beginning of the
financial period
4,6103,459
Effect of exchange rate movements on cash(333)(208)
Cash and cash equivalents at end of year3.1a$5,953$4,610
The above Consolidated Cash Flow Statement should be read in conjunction with the accompanying notes.
Wellington Drive Technologies Ltd
Notes to the Financial Statements
1. Basis of preparation
This section sets out the Group’s significant accounting policies that relate to the financial statements as a whole.
Where an accounting policy is specific to a note, that policy is stated in the note to which it relates.
1.1 General Information
Wellington Drive Technologies Limited (the “Company”) and its subsidiaries (together the “Group”) develop
Internet of Things (IoT) solutions and manufacture, market and sell energy saving, electronically commutated (EC)
motors, connected controllers and fans for worldwide use.
The Company is a limited liability company incorporated and domiciled in New Zealand. The address of its
registered office is 21 Arrenway Drive, Rosedale, Auckland 0632 New Zealand. The Company is registered under
the Companies Act 1993 and is an FMC reporting entity under Part 7 of the Financial Markets Conduct Act 2013.
The financial statements have been prepared in accordance with the requirements of Part 7 of the Financial
Markets Conduct Act 2013 and the NZX Main Board Listing Rules.
These consolidated financial statements have been approved for issue by the Board of Directors on [Date].
1.2 Summary of Significant Accounting Policies
(a). Basis of preparation
These consolidated financial statements of the Group have been prepared in accordance with generally accepted
accounting practice in New Zealand. The Group is a for-profit entity for the purposes of financial reporting. The
consolidated financial statements comply with New Zealand Equivalents to International Financial Reporting
Standards (NZ IFRS), other New Zealand accounting standards and authoritative notices that are applicable
to entities that apply NZ IFRS. The consolidated financial statements also comply with International Financial
Reporting Standards (IFRS).
The principal accounting policies adopted in the preparation of the financial statements are set out below. These
policies have been consistently applied to all the years presented, unless otherwise stated.
Entities reporting
The financial statements are for the consolidated Group which is the economic entity comprising of Wellington
Drive Technologies Limited and its subsidiaries.
Historical cost convention
These financial statements have been prepared under the historical cost convention except for derivative financial
instruments and contingent consideration which is measured at fair value.
New standards, amendments and interpretations effective in the current year
The following accounting standards, amendments and interpretations have not had a material impact on the
financial statements.
• Software as a Service Arrangements
• Interest Rate Benchmark Reform
New standards, amendments and interpretations not yet adopted
The following accounting standards, amendments and interpretations are mandatory for future periods and are
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Wellington Drive Technologies Ltd
unlikely to have a material impact on the financial statements prepared by the Company.
• Onerous Contracts – Cost of Fulfilling a Contract – effective from 1 January 2022
• Property, Plant and Equipment – effective from 1 January 2022
• Classification of Liabilities as Current and Non-Current – effective from 1 January 2023
Going concern assumption
The Group reported a profit for the 2021 year of $5,425,000 (2020: loss of $2,154,000) although this result for
2021 includes a $6,051,000 non-cash credit for the recognition of a deferred tax asset. Operating cash inflows for
the 2021 year was $3,947,000 (2020: $340,000). Cash at 31 December 2021 was $5,953,000 (2020: $4,610,000)
and net cash (defined as cash balances net of borrowings) was $3,956,000 (2020: $2,577,000).
The primary impact of COVID-19 in the 2021 year was on the supply chain in contrast to the 2020 year which saw
customer demand reductions. The Group remains subject to a higher than usual level of risk in the current global
environment including unexpected cost increases, factory closures or capacity reductions due to the COVID-19
virus, suppliers unable to supply some critical components and other unanticipated disruptions to supply. The
Group has managed through these disruptions in 2021 by;
• Increasing pricing to maintain gross margins.
• Actively sourcing alternate components.
• Redesigning products to utilise alternate components where required.
• Extending customer order lead times.
• Engaging with customers to delay deliveries and / or otherwise vary customer orders.
The Board expects these actions to continue to be required in 2022. Forecasts have been prepared which make
allowance for expected cost increases, product redesign and associated costs. These forecasts are most sensitive
to revenue declines due to customer demand and margin pressure and delays in delivering products to customers
due to the impact of macroeconomic supply chain factors, but the Board considers that there are actions that
would be taken to ensure that the Group would maintain adequate cash reserves.
The directors have, at the time of approving the financial statements, a reasonable expectation that the Group
have adequate resources to continue in operational existence for the foreseeable future from the date of
approving the financial statements and they have assessed it is appropriate to continue to adopt the going
concern basis in preparing the financial statements.
(b). Principles of consolidation
Subsidiaries are all entities over which the Group has control. The Group controls an entity when the Group is
exposed to, or has rights to, variable returns from its involvement with the entity and can affect these returns
through its power over the entity.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are
deconsolidated from the date that control ceases.
The acquisition method of accounting is used to account for the acquisition of subsidiaries by the Group. The
cost of an acquisition is measured as the fair value of the assets transferred and equity instruments issued, and
liabilities incurred or assumed at the date of exchange. Identifiable assets acquired, and liabilities and contingent
liabilities assumed in a business combination are measured initially at their fair values at the acquisition date,
irrespective of the extent of any minority interest. The excess of the cost of acquisition over the fair value of the
Group’s share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than
the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in the Statement of
Comprehensive Income.
Intercompany transactions, balances and unrealised gains on transactions between Group companies are
eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies of
the Group.
Wellington Drive Technologies Ltd
(c). Foreign currency translation
(i) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency
of the primary economic environment in which the entity operates (‘the functional currency’). The Company’s
functional currency is US Dollars because its purchase and sale of product is mainly denominated in US Dollars.
Subsidiaries and operations in the USA, China, Brazil, Turkey, Mexico, Italy, Australia, Spain and Singapore use
their local currency as the functional currency.
The consolidated financial statements are presented in New Zealand dollars, rounded to the nearest thousand,
which is the Group’s presentation currency. The presentation currency remains New Zealand dollars due to the
Company’s shareholder base being concentrated in New Zealand.
(ii) 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.
(iii) Foreign operations
The results and balance sheets of all foreign operations that have a functional currency different from New
Zealand dollars are translated into the presentation currency as follows:
• assets and liabilities for each balance sheet presented are translated at the closing rate at the date of the
Statement of Financial Position.
• income and expenses for each Statement of Comprehensive Income are translated at average exchange
rates, unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the
transaction dates, in which case income and expenses are translated at the dates of the transactions; and
• all resulting exchange differences are recognised in other comprehensive income as a separate component
of equity.
(d). Critical accounting estimates and judgements
Estimates and judgments are continually evaluated and are based on historical experience and other factors,
including expectations of future events that are believed to be reasonable under the circumstances.
The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will,
by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk
of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are
detailed in the following notes to the financial statements:
Areas of estimation
• Going concern – forecasts – note 1.2a
Areas of judgement
• Deferred tax asset – recognition – note 2.5c
• Development costs - capitalisation of expenses and impairment testing - note 3.3
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2. Results for the year
This section focuses on the results and performance for the Group and how those numbers are calculated.
2.1 Segment information
An operating segment is a component of an entity that engages in business activities from which it earns revenues
and incurs expenses, whose operating results are regularly reviewed by the chief operating decision maker and
for which discrete financial information is available.
The chief operating decision maker, who is responsible for allocating resources and assessing performance of the
operating segments, has been identified as the Chief Executive Officer supported by the management team who
report directly to the CEO.
(a). Reportable segments
The Group is organised on a global basis into two operating divisions – Motors and IoT. These divisions offer
different products and services and are managed separately because they require different technology and
marketing strategies. The Group’s chief executive officer reviews the financial performance of each division at
least monthly. Each division is a reportable segment.
There are varying levels of integration between the segments. There are engineering and sales staff that support
both segments as well as shared logistical and quality management services.
Information related to each reportable segment is set out below:
2021
Motors
$000s
IoT
$000s
Unallocated
$000s
Total
$000s
Revenue38,98525,233-64,218
Cost of goods sold(31,875)(14,470)-(46,345)
Gross profit7,11010,763-17,873
Gross margin %18.2%42.7%27.8%
Other income43688128
Operating expenses(2,539)(4,508)(8,005)(15,052)
Gain on remeasurement
of contingent consideration
-(323)-(323)
EBITDA4,5755,968(7,917)2,626
Depreciation(301)(192)(85)(578)
Amortisation(307)(1,669)(39)(2,015)
Impairment(393)--(393)
Loss before interest & taxation3,5744,107(8,041)(360)
Finance income--1111
Finance expense--(207)(207)
(Loss) / profit before income tax3,5744,107(8,237)(556)
Income tax credit / (expense)--5,9815,981
Profit / (loss) for the year$3,574$4,107($2,256)$5,425
2021
Motors
$000s
IoT
$000s
Unallocated
$000s
Total
$000s
Non-current assets
Property, plant & equipment5061111,1071,724
Deferred tax asset--6,0516,051
Goodwill-3,127-3,127
Other intangible assets3,5415,4944579,492
Total$4,047$8,732$7,615$20,394
2020
Motors
$000s
IoT
$000s
Unallocated
$000s
Total
$000s
Revenue24,41812,462-36,880
Cost of goods sold(19,275)(7,057)-(26,332)
Gross profit5,1435,405-10,548
Gross margin %21.1%43.4%28.6%
Other income2885563121,156
Operating expenses(2,449)(3,085)(5,996)(11,530)
Gain on remeasurement
of contingent consideration
-1,016-1,016
EBITDA2,9823,892(5,684)1,190
Depreciation(322)(235)(84)(641)
Amortisation(364)(1,312)(10)(1,686)
Impairment(44)(412)-(456)
Loss before interest & taxation2,2521,933(5,778)(1,593)
Finance income--77
Finance expense--(389)(389)
(Loss) / profit before income tax2,2521,933(6,160)(1,975)
Income tax expense--(179)(179)
(Loss) / profit for the year$2,252$1,933($6,339)($2,154)
Non-current assets
Property, plant & equipment6361501,2972,083
Goodwill-3,139-3,139
Other intangible assets3,8185,1522889,258
Total$4,454$8,441$1,585$14,480
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(b). Geographical segments
The Group operates in three main geographical areas, although it is managed on a global basis.
Revenue from external customers by geographic areas
2021
$000s
2020
$000s
Americas51,06828,735
Asia / Pacific (APAC)4,9503,518
Europe / Middle East / Africa (EMEA)8,2004,627
Total$64,218$36,880
Revenue is allocated above based on the country in which the customer is located.
APAC revenue includes $1,493,000 (2020: $184,000) from New Zealand customers.
Major Customers
The Group has four major customers (defined as customers representing 10% or more of revenues) accounting
for invoiced revenues of $30,293,000 (2020: three customers accounting for invoiced revenues of $13,692,000),
all within the Americas geographic segment.
Total non-current assets
2021
$000s
2020
$000s
Americas2,07426
Asia / Pacific – mainly in New Zealand18,27314,379
Europe / Middle East / Africa4775
Total$20,394$14,480
Total non-current assets are allocated based on where the assets are located.
2.2 Revenue
2021
$000s
2020
$000s
Sales of goods revenue – recognised at a point in time62,77135,678
Services revenue – recognised over time1,4471,202
$64,218$36,880
Revenue is measured at the fair value of the consideration received or receivable for the sale of goods and
services, excluding GST / VAT, rebates and discounts and after eliminating sales within the Group. The Group
disaggregates revenue from contracts with customers by geographical regions, which is detailed in note 2.1(b).
(a). Sale of Goods
The Group manufactures and sells a range of energy efficient motors and IoT hardware to the food and beverage
market. Sales are recognised when control has transferred to the buyer which is usually when delivery of the
goods to the buyer pursuant to the Incoterms that apply is fulfilled, and there is no unfulfilled obligation that could
affect the customer’s acceptance of the products. Delivery occurs when the products have been delivered in
accordance with the pre-agreed Incoterms between the Group and the buyer, the risks of obsolescence and loss
have been transferred to the buyer, and either the buyer has accepted the products in accordance with the sales
arrangement, the acceptance provisions have lapsed, or the Group has objective evidence that all criteria for
acceptance and performance obligations under the contract with the customer have been satisfied.
Some of the sales of goods are subject to CIF (Cost, Insurance and Freight) Incoterms. The Group considers
these freight and insurance services to be a distinct service. For these sales, the total sales price is allocated to
the separate performance obligations, being the product and the insurance and freight costs. Further, the Group
considers itself an agent only in the provision of the freight services. Revenue for the CIF element is recognised
only to the extent of the margin for providing the agent services. However, there are limited sales under CIF terms
and the impact on revenue is estimated to be minor.
The Group has in-market distributors in China and Brazil to supply goods to buyers in those markets who require
local delivery. These distributors transact as agents. The Group is the principal in these transactions. Sales of
product are recognised when these distributors deliver the product to buyers at which point control passes to
the buyer.
Products may be sold with retrospective volume rebates based on aggregate sales over a 12-month period.
Revenue from these sales is recognised based on the price specified in the contract, net of the estimated volume
rebates. Accumulated experience and customer knowledge are used to determine the rebate amounts using
the expected value method and revenue is only recognised to the extended that it is highly probable significant
reversals will not occur. The liability to pay volume rebates is recognised (included in trade and other payables) in
respect of sales made until the end of the reporting period.
No element of financing is deemed present as the sales are made with a credit term of 30 - 120 days which is
consistent with market practice. A receivable is recognised when the goods are delivered as this is the point of
time that the consideration is unconditional because only the passage of time is required before the payment
is due.
(b). Sale of services
Associated with the supply of IoT hardware, the Group supplies a range of data, and reporting services, all
installed on every Connect SCS, Connect Monitor and Connect Click sold and are distinct services from the sale
of goods. Revenue from the provision of such services is recognised when services are rendered to the buyer.
Contracts typically cover a period from hardware supply of anywhere from 1 to 10 years, dependent on customer
requirements. Contracts specify the price for the provision of the services. Revenue from such contracts is
recognised on a straight-line basis over the contract term because the customer receives and uses the benefits
simultaneously. As set out in note 2.2(a), no explicit element of financing is deemed present as the purpose of the
advance payment of revenue is for reasons other than financing.
The Group also provides software development services for customers. Revenue from these services is
recognised when the contracted development is completed according to the agreed scope of work.
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Contract liabilities
2021
$000s
2020
$000s
Carrying amount at start of year4,1964,418
Invoiced in the year3,8601,310
Recognised in revenue(1,447)(1,202)
Exchange adjustment184(330)
Carrying amount at end of year$6,793$4,196
Current portion1,4311,044
Non-current portion5,3623,152
$6,793$4,196
2.3 Other income
2021
$000s
2020
$000s
Net foreign exchange gains7418
Covid-19 Government support151,090
Other income3948
$128$1,156
2.4 Operating expenses include
2021
$000s
2020
$000s
Wages and salaries and other short-term benefits11,3009,807
Employer contributions to Kiwisaver and 401K plans385324
Employee share options expense31-
Total employee benefits$11,716$10,131
Payments to contractors1,5911,331
Capitalisation of labour and expenses to intangible assets($2,057)($3,099)
The amount disclosed above for wages and salaries is stated before capitalisation of labour to intangible assets.
Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave
expected to be settled within 12 months of the reporting date are recognised in other payables in respect of
employees’ services up to the reporting date and are measured at the amounts expected to be paid when the
liabilities are settled. Liabilities for non-accumulating sick leave are recognised when the leave is taken and
measured at the rates paid or payable.
Wages and salaries in 2021 included $1,109,000 for the reimbursement in the year of 2020 staff salary reductions
which were an important component of the Group’s COVID response.
The Group recognises a liability and an expense for bonuses and creates a provision where contractually obliged
or where there is a past practice that has created a constructive obligation.
2.5 Income tax expense
Current and deferred income tax
The income tax expense or revenue for the year is the tax payable on the current period’s taxable income (based
on the national income tax rate for each jurisdiction) adjusted by changes in deferred tax assets and liabilities
attributable to temporary differences between the tax bases of assets and liabilities and their carrying amounts in
the financial statements, and to unused tax losses.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to
apply when the assets are recovered, or liabilities are settled, based on those tax rates which are enacted or
substantively enacted for each jurisdiction. The relevant tax rates are applied to the cumulative amounts of
deductible and taxable temporary differences to measure the deferred tax asset or liability. An exception is made
for certain temporary differences arising from the initial recognition of an asset or a liability. No deferred tax asset
or liability is recognised in relation to these temporary differences if they arose in a transaction, other than a
business combination, that at the time of the transaction did not affect either accounting profit or taxable profit
or loss.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and
tax bases of investments in controlled entities where the parent entity is able to control the timing of the reversal of
the temporary differences and it is probable that the differences will not reverse in the foreseeable future.
Goods and Services Tax (GST) and Value Added Tax (VAT)
The Statement of Comprehensive Income has been prepared so that all components are stated exclusive of GST
and VAT. All items in the Statement of Financial Position are stated net of GST and VAT, except for receivables
and payables, which include GST and VAT invoiced.
(a). Income tax
2021
$000s
2020
$000s
Current year income tax expense(70)(179)
Deferred tax – initial recognition of deferred tax asset6,051-
Income tax credit / (expense)$5,981($179)
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2021
$000s
2020
$000s
Tax losses to carry forward27,97827,211
Total temporary differences and tax losses to carry forward30,82729,550
Deferred tax asset recognised for:
Temporary differences2,849-
Carry forward tax losses utilised3,202-
Total recognised6,051-
Unrecognised tax losses$24,776$29,550
Of the total consolidated losses available to carry forward to future years, $2,798,000 (2020: $3,904,000) arises
in the USA and is subject to their continuity requirements. USA Federal tax losses expire after 15 to 20 years,
depending on when those losses were incurred. During the 2021 year no USA Federal tax losses expired
(2020: None).
(c). Imputation credits
The Group has no imputation credits available (2020: $nil) and no movements occurred in the Imputation Credit
Account (2020: $nil).
2.6 Earnings per share
Earnings per share (‘EPS’) is the amount of post-tax profit attributable to each share.
Basic EPS of a profit of 1.26 cents (2020: loss of 0.58 cents) is calculated by dividing the profit attributable to
equity holders of the Company of $5,425,000 (2020: loss of $2,154,000) by the weighted average number of
ordinary shares in issue during the year of 431,914,620 (2020: 372,315,814).
Diluted EPS of a profit of 1.23 cents (2020: loss of 0.58 cents) is calculated by dividing the profit attributable to
equity holders of the Company of $5,425,000 (2020: loss of $2,154,000) by the weighted average number of
shares in issue during the year, after adjusting for effects of all potentially dilutive ordinary shares.
The charge for the year can be reconciled to the result before tax as follows:
2021
$000s
2020
$000s
Reported (loss) / profit for period before tax(556)(1,975)
Tax at 28%(156)(553)
Effect of different tax rates of subsidiaries in
other jurisdictions
(5)-
Tax effect of non-deductible / non-assessable items(31)(467)
Tax effect of utilisation of losses not previously recognised122841
Initial recognition of deferred tax asset6,051-
Income tax credit / (expense) for the year$5,981($179)
(b). Deferred tax
The Group has not previously recognised income tax losses and temporary differences as a future income tax
benefit. As it is now probable that future taxable amounts will be available to utilise those temporary differences
and losses, a deferred tax asset is now recognised for deductible temporary differences and for that portion of the
unused tax losses that are expected to be utilised in the five years 2022 through to 2026. No deferred tax asset
has been recognised in respect of the remaining tax losses to carry forward due to uncertainty as to forecast
taxable income after the five years.
Losses available to be carried forward are subject to the shareholder continuity requirements of the New Zealand
Income Tax Act 1994 and the countries in which the losses have arisen.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset, and they
relate to the same tax authority. The tax rate applicable to each group company has been used to determine the
below recognised and unrecognised deferred tax assets:
2021
$000s
2020
$000s
Doubtful debts2645
Inventory provisions and eliminations 58207
Employee benefits357338
Internally generated development2,3941,992
Warranty provision5888
Rebates164152
Fixed assets81(153)
Right of use lease liability
(277
)
(327)
Other timing differences(12)(3)
Total temporary differences2,8492,339
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3. Operating assets and liabilities
This section focuses on the assets used to generate the Group’s trading performance and the liabilities incurred as
a result.
3.1 Working capital
Working capital represents the assets and liabilities the Group generates through its trading activities. The Group
therefore defines working capital as cash, trade and other receivables, inventory, trade and other payables and
provisions.
(a). Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with financial institutions and other short
term and highly liquid investments with original maturities of three months or less that are readily convertible to
known amounts of cash and which are subject to an insignificant risk of changes in value.
2021
$000s
2020
$000s
Cash on hand and at bank2,4512,251
Call deposits3,4272,283
Short term bank deposit7576
$5,953$4,610
The carrying amount of the Group’s cash and cash equivalents is denominated in the following currencies:
NZD485636
USD4,5793,738
Other889236
$5,953$4,610
(b). Trade and other receivables
Trade receivables are recognised initially at the value of the invoice sent to the customer. The Group generally
holds the trade receivables with the objective to collect the contractual cash flows and therefore measures them
subsequently at amortised cost using the effective interest method. Trade receivables are generally due for
settlement no more than 120 days from the date of recognition.
The Group applies the simplified approach permitted by NZ IFRS 9 which requires lifetime expected credit losses
to be recognised from initial recognition of the trade receivable. Trade receivables are written off when there is no
reasonable expectation of recovery.
The Group takes out trade credit insurance to hedge against some of the credit risk. NZ IFRS 9 requires the
Group to calculate expected credit losses on trade receivables using a provision matrix. The Group has reviewed
its credit loss experience over the period from 2013 to 2021 and has determined that the probability weighted
credit loss experience over that period was approximately 0.1% of revenue. Consideration has been given to
market environmental factors to determine whether future conditions will impact. The provision for expected credit
loss at balance date has been calculated at 1.5% for customers assessed as higher risk and 0.1% for all others
(2020: 1.5% and 0.1% respectively).
2021
$000s
2020
$000s
Trade receivables16,4987,695
Provision for loss allowance(90)(157)
Net trade receivables16,4087,538
Prepayments837462
VAT/GST refunds due133113
Income tax refund due214253
Other receivables255258
$17,847$8,624
The carrying amount of the Group’s trade and other receivables is denominated in the following currencies:
NZD13385
USD16,4437,163
EUR540702
MXP1304
Other730370
$17,847$8,624
Provision for loss allowance
Carrying amount at start of year157150
(Decrease) / increase in loss allowance(78)7
Exchange adjustment11-
Carrying amount at end of year$90$157
The decrease in provision is recognised within ‘Operating expenses’ in the Statement of Comprehensive Income.
(c). Inventories
Inventories are stated at the lower of cost and net realisable value. Costs are assigned to individual items of
inventory based on first in first out. Net realisable value is the estimated selling price in the ordinary course of
business less the estimated costs necessary to make the sale.
Management reviews inventory on a line-by-line basis. Judgments are made about expected selling prices and
obsolescence based on forecast sales. A provision is recognised for inventory which is expected to sell for less
than cost.
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2021
$000s
2020
$000s
Finished goods – at cost4,7272,833
Work in progress – at cost-383
Raw materials – at cost320655
Less inventory provisions(447)(454)
Total inventories$4,600$3,417
Cost of inventories recognised as an expense and included in cost of sales $44,099,000 (2020: $25,051,000).
(d). Trade and other payables
Trade payables are recognised at the value of the invoice received from a supplier. These amounts represent
liabilities for goods and services provided to the Group prior to balance date. The amounts are unsecured and are
usually paid within 90 days of recognition.
2021
$000s
2020
$000s
Trade payables14,5087,375
Employee entitlements 1,7911,620
GST / VAT payable353-
Accrued expenses2,515877
$19,167$9,872
The carrying amount of the Group’s trade and other payables is denominated in the following currencies:
NZD2,2252,143
USD16,1067,355
Other836374
$19,167$9,872
(e). Provisions
Provisions are recognised when the Group has a present legal or constructive obligation because of past events,
is more likely than not that an outflow of resources will be required to settle the obligation, and the amount has
been reliably estimated. Provisions are not recognised for future operating losses.
The Group sells goods with warranty periods of up to five years. The terms of the warranty provide that the Group
will repair or replace items that fail to perform satisfactorily. A provision has been recognised based on historical
data and average levels of repairs and warranty claims experienced by the Group. It is expected that the provision
will be utilised within one year as any product failures are typically exhibited within one year of sale.
Warranty provision
2021
$000s
2020
$000s
Carrying amount at start of year315468
Additional provisions recognised5612
Amounts used(178)(148)
Exchange adjustment12(17)
Carrying amount at end of year$205$315
3.2 Property, plant and equipmen
t
All property, plant and equipment are stated at historical cost less depreciation and impairments. Historical cost
includes expenditure that is directly attributable to the acquisition of the items and the costs of bringing the asset
to the location and condition for it to be capable of operating in the manner intended.
Costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it
is probable that future economic benefits associated with the item will flow to the Group and the cost of the item
can be measured reliably. All other repairs and maintenance are charged to the Statement of Comprehensive
Income during the financial year in which they are incurred.
Depreciation of owned plant and equipment is calculated using the straight-line method to allocate their cost net of
their residual values, over their estimated useful lives, as follows:
Useful Life
Plant and equipment3 – 15 years
Property12 years
Office equipment, furniture and fittings 3 – 15 years
The assets’ residual values and useful lives are reviewed and adjusted as 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.
Plant and equipment can be analysed as follows:
Plant &
equipment
$000s
Office equipment,
furniture & fittings
$000s
Properties
$000s
Total
$000s
Year ended 31 December 2020
Opening net book amount1,3351821,1412,658
Reclassification(176)11066-
Additions14268-210
Depreciation(316)(125)(200)(641)
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3.3 Intangible assets
Research, development and patent costs
Expenditure on research activities, undertaken with the prospect of obtaining new scientific or technical knowledge
and understanding, is recognised in the Statement of Comprehensive Income as an expense when it is incurred.
Expenditure on development activities, being the application of research findings or other knowledge to a plan or
design to produce new or substantially improved products or services before the start of commercial production
or use, is capitalised if the product or service is technically and commercially feasible and adequate resources
are available to complete development. This involves the use of judgement. Development costs are capitalised
once it can be demonstrated that the asset is supported by future economic benefits. Management considers
the following criteria when making its judgment as to when it is appropriate to commence capitalisation of
development costs:
• Technical feasibility of completing the development so that it will be available for use or sale.
• Intention to complete the development.
• Ability to use the developed asset or sell it.
• Existence of a market.
• Availability of adequate technical, financial and other resources to complete and commercialise the
development; and
• Ability to measure reliably the expenditure attributable to the development.
All capitalised development costs met the criteria as outlined above.
The expenditure capitalised comprises all directly attributable costs, including costs of materials, services, direct
labour and an appropriate proportion of overheads.
Development expenditure which does not meet the criteria for capitalisation is recognised in the Statement of
Comprehensive Income as an expense as incurred. Capitalised development expenditure is stated at cost less
accumulated amortisation and any impairment losses.
Amortisation of capitalised development costs is calculated using the straight-line method to allocate the cost over
the period of the expected benefit, up to a maximum of 10 years for motors and up to a maximum of 5 years for
IoT hardware. Judgment is involved in determining this period of benefit. For motors, the Group considered the
earlier versions of motors and the length of time from completion to continued sales contribution; whereas for IoT
hardware, the Group considered that 5 years is an appropriate life given the inherent risk of rapid technological
change.
Computer software
Acquired computer software licences are capitalised based on the costs incurred to acquire and bring to use the
specific software. These costs are amortised over their estimated useful lives (3 to 5 years).
Costs associated with maintaining computer software programmes are recognised as an expense as incurred.
Impairment testing of non-financial assets
Intangible assets that have an indefinite useful life or intangible assets not ready for use are not subject to
amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed
for impairment whenever events or changes in circumstances indicate that the carrying amount may not be
recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its
recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and 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).
Goodwill is tested annually for impairment, or immediately if events or changes in circumstances indicate that it
might be impaired and carried at cost less accumulated impairment losses. Impairment losses on goodwill are
not reversed.
Plant &
equipment
$000s
Office equipment,
furniture & fittings
$000s
Properties
$000s
Total
$000s
Disposals----
Exchange adjustment(71)(11)(62)(144)
Closing net book amount$914$224$945$2,083
At 31 December 2020
Cost6,1801,0232,1789,381
Accumulated depreciation and
impairment
(5,186)(729)(1,212)(7,127)
Exchange adjustment(80)(70)(21)(171)
Net book amount$914$224$945$2,083
Year ended 31 December 2021
Opening net book amount9142249452,083
Reclassification(9)9--
Additions5975-134
Depreciation(276)(135)(167)(578)
Disposals----
Exchange adjustment31233185
Closing net book amount$719$196$809$1,724
At 31 December 2021
Cost6,2111,0922,1789,481
Accumulated depreciation and
impairment
(5,443)(849)(1,379)(7,671)
Exchange adjustment(49)(47)10(86)
Net book amount$719$196$809$1,724
The above amounts include those relating to right-of-use assets. Refer to note 6.5 for further disclosures.
Capital commitments
Capital commitments contracted for at 31 December 2021 amounted to $244,000 (2020: $95,000).
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Internally generated development costs include $3,383,000 (2020: $5,493,000) for projects underway and not
complete at balance date. This cost is not yet being amortised. An impairment assessment has been performed at
31 December 2021 considering costs to complete the developments, costs to set up the manufacturing capability,
estimates of market volume and price and estimated manufacturing unit costs.
Amortisation and impairment
2021
$000s
2020
$000s
Amortisation of intangible assets2,0151,686
Impairment of intangible assets393456
$2,408$2,142
Impairment losses have been recognised as follows:
Patent costs – $ (2020: $44,000) - The carrying value of patents which were not renewed.
Internally generated development costs - $393,000 (2020: $412,000) - the carrying value of costs for the
development of an EC-C frame has been impaired as it is not now certain that the development will be completed.
Goodwill and intangible assets with indefinite lives
Goodwill acquired through business combinations with indefinite lives has been allocated to the IoT Cash
Generating Unit (CGU) which is also an operating and reportable segment for impairment testing. The Group
performed its impairment test as at 31 December 2021.
The recoverable amount of the IoT CGU on 31 December 2021 has been determined based on a value in use
calculation using cash flow projections from the annual operating plan approved by senior management for 2022,
together with a forecast for 2023. The pre-tax discount rate applied to cash flow projections is 14% (2020: 14%)
and cash flows beyond 2023 using a 5.0% growth rate (2020: 5%).
The calculation of value in use is most sensitive to the following assumptions:
• Gross margins.
• Completion and launch of new IoT products under development and retaining volumes to current customers.
• Growth rates used to extrapolate cash flows beyond the forecast period.
• Operating expense increases.
Gross margins are based on current pricing and product costs. The gross margin in 2021 was 42.7% and is
forecast in the range of 43% to 46% for the two years 2022 and 2023. The forecasts include revenues on products
currently under development that are expected to launch in 2022. The amount of forecast revenue in respect of
these new products in 2022 is $1,573,000 and $2,400,000 in 2023. The assumption is that operating expenses
comprising mainly employee costs are maintained at the same ratio to sales. In the 2022 operating plan, the ratio
of operating expenses to revenue is 17%.
As a result of this analysis, management did not identify an impairment for this CGU.
Internally
Generated
Development
$000s
Patents
$000s
Goodwill
$000s
Other
$000s
Total
$000s
Year ended 31 December 2020
Opening net book amount8,5283093,2238712,147
Reclassification(102)(1)(4)107-
Additions3,08846-193,153
Amortisation(1,592)(81)-(13)(1,686)
Impairment(412)(44)--(456)
Exchange adjustment(656)(12)(80)(13)(761)
Closing net book amount$8,854$217$3,139$187$12,397
At 31 December 2020
Cost20,6041,5713,21986126,255
Accumulated amortisation &
impairment
(11,531)(1,370)-(645)(13,546)
Exchange adjustment(219)16(80)(29)(312)
Net book amount$8,854$217$3,139$187$12,397
Year ended 31 December 2021
Opening net book amount8,8542173,13918712,397
Additions2,04239-82,089
Amortisation(1,948)(53)-(14)(2,015)
Impairment(393)---(393)
Exchange adjustment53012(12)11541
Closing net book amount$9,085$215$3,127$192$12,619
At 31 December 2021
Cost22,6461,6103,21986928,344
Accumulated amortisation &
impairment
(13,872)(1,423)-(659)(15,954)
Exchange adjustment31128(92)(18)229
Net book amount$9,085$215$3,127$192$12,619
Goodwill relates to the iProximity Pty Limited which is a component of the IoT reportable segment.
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4. Capital and financing costs
This section sets out the Group’s capital structure and shows how it finances its operations and growth.
To finance the Group’s activities (now and in the future) the Board monitors and determines the appropriate capital
structure for Wellington to execute strategy and to deliver its business plan.
4.1 Borrowings
Working capital represents the assets and liabilities the Group generates through its trading activities. The Group
therefore defines working capital as cash, trade and other receivables, inventory, trade and other payables and
provisions.
2021
$000s
2020
$000s
Current portion
Bank trade finance facility75572
Bank loans228-
Liabilities in respect of right-of-use assets232217
Other borrowings19674
Liability at end of year$731$863
Non-Current portion
Liabilities in respect of right-of-use assets760992
Bank loans28473
Other borrowings222105
Liability at end of year$1,266$1,170
Borrowings, other than in respect of right-of-use assets, are initially recognised at fair value, net of transaction
costs incurred, and are subsequently measured at amortised cost. Any difference between the proceeds and the
redemption amount is recognised in the Statement of Comprehensive Income over the period of the borrowings
using the effective interest method. Borrowings are classified as current liabilities unless the Group has an
unconditional right to defer settlement of the liability for at least 12 months after balance date. Borrowing costs are
expensed when incurred.
Accounting policies relating to lease liabilities are outlined in note 6.5.
Movements in bank and other loans during the year were:
2021
$000s
2020
$000s
Liability at start of year8241,683
New loans and drawdowns2,0717,267
Repayments(1,902)(8,019)
Exchange adjustment12(107)
Liability at end of year$1,005$824
Bank trade finance facility
The $2.5m facility has no term, is repayable on demand and is secured. The Company can finance invoices to
certain customers over a maximum term of 120 days. Interest is payable at a 3% margin above bank base lending
rate. The weighted average interest rate charged in 2021 was 4.28% (2020: 4.11%). The Company has complied
with all cover covenants.
Bank term loans
The Company’s US subsidiary borrowed US$198,800 under the Small Business Act. The SBA loan has monthly
repayments over a 30-year term with repayments commencing in July 2021. Interest is payable at 3.75% pa.
The Company’s Mexican subsidiary borrowed 3 million Mexican Pesos ($213,330 at 31 December 2021) from the
Banco del Bajio. The loan is repayable after six months and interest is payable at 4% pa above the Tiie Rate.
4.2 Finance
2021
$000s
2020
$000s
Finance income
Other interest income117
$11$7
Finance expenses
Interest expense – Bank loans2787
Other interest expense180302
$207$389
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4.3 Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or
options are shown in equity as a deduction, net of tax, from the proceeds.
2021
Shares
2020
Shares
2021
$000s
2020
$000s
Ordinary shares – fully paid431,914,620431,914,620135,553135,553
Ordinary shares – partly paid-421,98022
Total shares on issue431,914,620432,336,600$135,555$135,555
(a). Ordinary shares – fully paid
Opening balance of ordinary shares on issue431,914,620322,707,005135,553130,202
Issue of ordinary shares during the year:
• Rights issue
-
107,978,028-5,399
• Exercise of part paid shares and options
-
1,229,587-69
• Share issue costs
-
--(117)
Ordinary fully paid shares on issue at year end431,914,620431,914,620$135,553$135,553
All ordinary shares are authorised and have no par value. Ordinary shares entitle the holder to participate in
dividends and the proceeds on winding up of the Company in proportion to the number of and amounts paid on
shares held.
(b). Ordinary shares – partly paid
Partly paid shares outstanding at start of year421,9805,810,742226
Exercise of part paid shares during the year-(940,940)-(1)
Surrendered or lapsed(421,980)(4,447,822)-(23)
Ordinary part paid shares on issue at year end-421,980$2$2
4.4 Accumulated losses
2021
$000s
2020
$000s
Opening balance(116,892)(114,738)
Profit for the year5,425(2,154)
Accumulated losses at end of year($111,467)($116,892)
4.5 Other reserves
2021
$000s
2020
$000s
Share option compensation reserve353322
Currency translation reserve(4,153)(4,270)
($3,800)($3,948)
(a). Share Option Compensation Reserve
2021
$000s
2020
$000s
Share based compensation recognised at start of year322322
Net compensation expensed31-
$353$322
(b). Currency Translation Reserve
2021
$000s
2020
$000s
Opening balance(4,270)(2,705)
Exchange gains / (losses) on translation
of foreign operations
117(1,565)
($4,153)($4,270)
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5. Risk
This section presents information about the Group’s exposure to financial and commercial risks; the Group’s
objectives, policies and processes for managing those risks.
5.1 Key financial risks
The Group’s principal financial instruments comprise receivables, payables, cash and cash equivalents,
borrowings, derivatives and contingent consideration.
The Group manages its exposure to the key financial risks – market risk (including foreign currency risk and
interest rate risk), credit risk, liquidity risk and capital risk. The Group enters into derivative transactions (principally
forward currency contracts) to manage currency risks.
(a). Financial market risk
Foreign currency risk
The Group operates internationally and is exposed to foreign currency risk arising from various currency
exposures. Presently the Group’s revenue is based on USD pricing and invoicing is almost entirely USD
denominated. The Company’s functional currency is USD. The majority of the Group’s product, manufacturing and
logistics cost is invoiced and settled in USD. This provides a strong natural hedge position between revenues and
costs. USD funds are converted to NZD to meet New Zealand operational costs as required.
The Group is primarily exposed to changes in other currencies against the USD exchange rate. The Group’s
exposure to foreign currency risk at the end of the reporting period, expressed in NZD was:
20212020
Carrying
amount
$000
Currencies
other than
USD $000
Carrying
amount
$000
Currencies
other than
USD $000
Cash5,9531,3744,610872
Trade and other receivables17,8471,4048,6241,461
Trade and other payables(19,167)(3,061)(9,872)(2,517)
Borrowings(1,997)(1,410)(2,033)(1,388)
The sensitivity of profit or loss to changes in the exchange rates arises mainly from changes in other currencies
against the USD exchange rate. The impact on post tax profit holding all other variables constant at 10%
sensitivity movement is as follows:
2021
$000s
2020
$000s
USD exchange rate increase 10% relative to other currencies122113
USD exchange rate decrease 10% relative to other currencies(122)(113)
The impact on other components of equity is not material because of minimal foreign forward exchange contracts
designated as cash flow hedges.
Interest Rate Risk
The interest rate on the bank trade finance facility is at variable rates. All other debt is fixed interest.
The Group has cash deposits in various currencies to facilitate trading in the countries in which it has a presence.
Most of the cash deposits are held in either NZD or USD.
The impact of a 1% increase / decrease in interest rates over a one-year period on the closing cash balance is
not significant.
(b). Credit risk
The Group generally trades with customers and banking counterparties who are well established. While there
are individually significant customers, the Group takes out trade credit insurance to provide better security.
Receivables balances are managed by and reported regularly to senior management according to credit
management policies and procedures. The amount outstanding at balance date represents the maximum
exposure to credit risk.
At balance date, the Group had three major debtors (defined as debtors representing 10% or more of trade
receivables) accounting for outstanding debt of $7,929,000 (2020: three debtors accounting for outstanding debt
of $2,952,000).
At balance date, trade receivables of $725,000 were past due but not considered impaired (2020: $655,000). Of
this amount $228,000 (2020: $622,000) was 3 months or more overdue.
The Group arranges forward foreign exchange contracts within specified policy limits and only with counterparties
approved by directors.
Cash and cash equivalents are deposited with several financial institutions in New Zealand and overseas.
$2,248,000 is deposited with a major NZ trading bank with a Standard & Poors rating of AA- (2020: $2,205,000
AA-) and $2,230,000 (2020: $1,851,000) with Western Union with a Standard & Poors rating of BBB/A-2. The
remaining balance of $1,475,000 (2020: $554,000) is held across several territories and non-performance of
obligations by the relevant banks is not expected due to the credit rating of the counter parties considered.
(c). Liquidity risk
The Group maintains regular forecasts of liquidity based on expected cash flows. The table below analyses the
Group’s financial liabilities into relevant groups based on the remaining period at the reporting date to the end of
the contractual date.
The amounts disclosed are the contractual discounted cash flows.
$000s20212020
Less than
6 months
7 to 12
months
2 to 5
years
Less than
6 months
7 to 12
months
2 to 5
years
Trade and other payables19,046--9,785--
Borrowings394105506572-73
Right-of-use asset liabilities1141187601431481,097
$19,554$223$1,266$10,500$148$1,170
Trade and other payables above exclude any liabilities for tax (including payroll taxes), statutory liabilities and
contract liabilities.
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(d). Capital risk management
The Company closely monitors its cash requirements.
The Group has complied with financial covenants under the bank trade finance facility.
Gearing ratio
2021
$000s
2020
$000s
Total borrowing1,9972,033
Total equity20,28814,715
Gearing9.8%13.8%
6. Other information
This section includes other information that must be disclosed to comply with accounting standards and other
pronouncements, but that is not immediately related to individual line items in the financial statements.
6.1 Subsidiaries
(a). The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in
accordance with the accounting policy described in Note 1.2b.
Country of
incorporation
Class of
shares
20212020
Wellington Drive Sales LtdNew ZealandOrdinary100%100%
Wellington Drive Technologies US, IncUSAOrdinary100%100%
Wellington Motor Teknolojileri San Tic Ltd StiTurkeyOrdinary100%100%
Wellington Italia SrlItalyOrdinary100%100%
Wellington Drive Technologies Pte LtdSingaporeOrdinary100%100%
Wellington Latin America Services SA de CVMexicoOrdinary100%100%
Wellington Mexico Tecnologia SA de CVMexicoOrdinary100%100%
iProximity Pty LimitedAustraliaOrdinary100%100%
Wellington Iberia S.L.SpainOrdinary100%100%
All subsidiaries have a common balance date of 31 December.
(b). Contingent consideration for acquisition of subsidiary
On 2 July 2018, the Company acquired 100% of the issued share capital of iProximity Pty Limited, an Australian
based innovative proximity marketing solutions and consumer intelligence company. The consideration for the
acquisition comprised up-front payments of AU$1,250,000 and cash and share-based earn out targets as follows:
• A$500,000 based on meeting specified EBIT targets (for iProximity’s existing business) for the 2018 and 2019
financial years; and
• the issue of fully paid ordinary shares in the Company in tranches based on meeting specified EBIT targets
for the period ending 31 December 2020 (9,448,964 shares) and based on Wellington’s Connect SCS System
controller unit sales (‘SCS Target’) for the same period (9,448,964 shares).
The purchase consideration was:
$000s
Cash paid1,367
Contingent consideration2,327
Total purchase consideration$3,694
EBIT targets were not achieved so the A$500,000 cash consideration is not payable and the 9,448,964 fully paid
ordinary shares are not required to be issued in respect of those targets. The Company agreed to extend the
period for the SCS Target to be achieved to 31 December 2021 and increased the number of units required to be
Annual Report 2021Annual Report 2021
(a).
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Wellington Drive Technologies LtdWellington Drive Technologies Ltd
sold for the remaining shares to be issued. 4,724,482 ordinary shares in the Company have been issued to 31
December 2020.
In the year ended 31 December 2021, 480,000 SCS controllers were sold which is in the SCS Target range
requiring the issue of a further 1,574,828 shares. The fair value of the share-based contingent consideration was
calculated to be $322,840 on 31 December 2021 and this resultant increase in contingent consideration has been
recognised as a fair value charge in the Statement of Comprehensive Income (Note 6.4).
Contingent consideration
2021
$000s
2020
$000s
Fair value at start of year-1,016
Remeasurement recognised in income statement323(1,016)
Total323-
6.2 Related party transactions
(a). Directors
The names of persons who are directors of the Company are on pages 41 to 42.
(b). Key management personnel and compensation
Key management personnel compensation is set out below. Key management personnel comprise the Directors
including the Chief Executive Officer (CEO) and all the senior executives who report directly to the CEO.
2021
$000s
2020
$000s
Salaries, fees and other short-term benefits1,7761,351
Share based remuneration31-
Directors’ remuneration561168
Total$2,368$1,519
(c). Employee share-based remuneration
Equity settled, share based compensation was provided in previous years to employees via the Wellington Partly
Paid Share Scheme and the US Employees Share Option Plan. The part paid shares issued in 2016 expired
during the year and lapsed. Amounts paid by employees for these partly paid shares will be refunded in 2022. At
31 December 2021 there were no outstanding partly paid shares or US Employees share options.
During the year, 12,930,000 options were issued to the Chief Executive Officer. 8,620,000 options (Tranche One)
will vest on 1 October 2024 and 4,310,000 options (Tranche Two) will vest on 1 October 2025, if the CEO remains
a full-time employee on those dates. The exercise price of the Tranche One options is 9.1 cents and of the
Tranche Two options is 11.5 cents.
The fair value of the employee services received in exchange for the grant of part paid shares or options are
recognised as an expense over the vesting period. The proceeds received net of any directly attributable
transaction costs are credited to share capital when the partly paid share proceeds are received, or options
are exercised.
Fair value is assessed at the date that the share options are issued using a binomial option pricing model that
takes into account the exercise price, the term of the options, the exercise criteria, the likelihood of staff turnover,
the non-tradable nature of the option, the share price at the issue date, the volatility of the returns on the
underlying share and the risk-free interest rate for the term of the options.
(d). Incentive scheme – deferral of settlement
At 31 December 2020, the Company had a liability under a short-term incentive plan (STI) to senior executives
amounting to $885,000 in respect of 2019 on target performance, payment of which was delayed to assisting the
Company to manage its cash flow following the Covid-19 demand reductions. Interest was payable at 10% pa.
This was settled in full in January 2021.
(e). East West Manufacturing LLC
East West Manufacturing LLC (East West), a substantial security holder in the Company, supplies goods and
services to the Company from its manufacturing facility in Vietnam and purchases product for distribution in
the USA.
2021
$000s
2020
$000s
Purchases from East West41,10819,685
Sales to East West512459
Cash payments to East West33,29026,036
Cash receipts from East West357879
Trade receivable from East West at 31 December20145
Trade payable to East West at 31 December12,1034,285
Interest payments to East West for extended credit terms-103
6.3 Contingencies
There are no material contingent liabilities or assets (2020 - $nil).
6.4 Financial instruments by category
2021
$000s
2020
$000s
Assets per Statement of Financial Position
Financial assets measured at amortised cost
Trade and other receivables17,5008,258
Cash and cash equivalents5,9534,610
$23,453$12,868
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Wellington Drive Technologies LtdWellington Drive Technologies Ltd
2021
$000s
2020
$000s
Liabilities per Statement of Financial Position at amortised cost
Trade and other payables19,1679,872
Borrowings1,9972,033
Liabilities (at fair value)
Derivative financial instruments21-
Contingent consideration323-
$21,508$11,905
Fair value estimation
The only financial instruments carried at fair value are derivatives comprising forward foreign exchange contracts
and contingent consideration.
The forward exchange contract has been classified as Level 2.
The different levels have been defined as follows:
• Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1).
• Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly (i.e. as prices) or indirectly (i.e. derived from prices) (Level 2).
• Inputs for the asset or liability that are not based on observable market data (i.e. unobservable inputs)
(Level 3).
The fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance
sheet date, with the resulting value discounted back to present value. The fair value of contingent consideration in
respect of the acquisition of iProximity Pty Limited is determined using the number of shares that are to be issued
to the vendors pursuant to the purchase agreement (1,574,828 shares) and the Company’s share price at 31
December 2021 (20.5 cents).
6.5 Leases
Property, plant and equipment in the Statement of Financial Position shows the following amounts related to
leases of right-of-use assets:
Right-of-use assets
2021
$000s
2020
$000s
Properties765893
Plant & equipment2140
Office equipment and furniture & fittings58
Total$791$941
Additions to right-of-use assets in the year
2021
$000s
2020
$000s
Plant & equipment
-
27
Total$-$27
The Consolidated Statement of Comprehensive Income shows the following amounts related to right-of-use
leases:
Depreciation charge for right-of-use assets
Properties180170
Plant & equipment189
Office equipment and furniture & fittings33
Total$201$182
Interest expense on lease liabilities$75$86
Expense relating to short-term leases (included in operating
expenses)
$42$37
The Consolidated Cash Flow Statement shows the following amounts related to right-of-use leases:
Total principal payments for right-of-use assets$217$193
The Group leases property, equipment and cars. Rental contracts are typically made for fixed periods but may
have extension options as described below. Lease terms for equipment and cars tend to be industry standard.
Other leases are negotiated on an individual basis.
Leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset is
available for use by the Group. Each lease payment is allocated between the liability and finance cost. The finance
cost is charged to Statement of Comprehensive Income over the lease period to produce a constant periodic rate
of interest on the remaining balance of the liability for each period. The right-of-use 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 based on an index or 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.
• Payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.
The lease payments are discounted using the interest rate implicit in the lease, if that rate can be determined, or
the Group’s incremental borrowing rate.
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Right-of-use 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.
• Restoration costs.
Payments associated with short-term leases and leases of low-value assets are recognised on a straight-line
basis as an expense in the Statement of Comprehensive Income. Short-term leases are leases with a lease term
of 12 months or less. Low-value assets are assets of a value of US$5,000 or less.
Lease renewal options are included in the property lease. In determining the lease term, management considers
all facts and circumstances that create an economic incentive to exercise the renewal option. Renewal options are
only included in the lease term if the lease is reasonably certain to be extended. The assessment is reviewed if a
significant event or a significant change in circumstances occurs which affects this assessment and that is within
the control of the lessee.
6.6 Other disclosures
Auditors’ remuneration
2021
$000s
2020
$000s
Deloitte
Audit of financial statements of the Group – current year170147
Audit of the financial statements of the Group – last year-40
Non audit services *
1
4926
Audit of subsidiaries by other auditors – Thong & Lim44
$223$217
*
1
Non audit services relate to tax compliance and payroll services.
6.7 Cash flow information
(a). Reconciliation of profit / (loss) for the year to net cash inflow from operating activities
2021
$000s
2020
$000s
Profit / (loss) for the year5,425(2,154)
Adjustments for:
Income tax credit / (expense)(5,981) -
Depreciation, amortisation & impairment2,9862,783
Share based payments31-
(Decrease) in inventory provision(7)(82)
(Decrease) / increase in loss allowance provision(67)7
(Decrease) in provision for warranty(110)(153)
2021
$000s
2020
$000s
Change in fair value of contingent consideration323(1,016)
Net foreign exchange differences(163)(478)
(Increase) / decrease in trade and other receivables(9,206)6,160
Increase / (decrease) in contract liabilities2,597(222)
(Increase) / decrease in inventories(1,176)1,461
Increase / (decrease) in trade and other payables9,295(5,966)
Net cash inflow from operating activities$3,947$340
(b). Net cash reconciliation
2021
$000s
2020
$000s
Cash and cash equivalents5,9534,610
Borrowings – repayable within one year(731)(863)
Borrowings – repayable after one year(1,266)(1,170)
Net cash$3,956$2,577
The bank trade finance facility is at variable interest rates. All other borrowings are at fixed interest rates,
with borrowings movements disclosed in note 4.1. The increase in cash during the year of $1,343,000 (2020:
$1,151,000 included a $333,000 decrease (2020: $208,000 decrease) caused by exchange rate movement.
6.8 Events after reporting date
There are no events after reporting date requiring disclosure.
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Independent Auditor’s Report
To the Shareholders of Wellington Drive Technologies Limited
We have audited the consolidated financial statements of Wellington Drive Technologies Limited
(the ‘Company’) and its subsidiaries (the ‘Group’), which comprise the consolidated statement of
financial position as at 31 December 2021, and the consolidated statement of comprehensive income,
statement of movements in equity and cash flow statement for the year then ended, and notes to the
consolidated financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying consolidated financial statements, on pages 47 to 84, present fairly,
in all material respects, the consolidated financial position of the Group as at 31 December 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 (‘NZ IFRS’) and International
Financial Reporting Standards (‘IFRS’).
We conducted our audit in accordance with International Standards on Auditing (‘ISAs’) and
International Standards on Auditing (New Zealand) (‘ISAs (NZ)’). Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated
Financial Statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
We are independent of the 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
the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional
Accountants (including International Independence Standards), and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
Our firm carries out other assignments for the Group in the area of taxation advice, including tax
compliance services for the Mexican subsidiary. These services have not impaired our independence
as auditor of the Company and Group. In addition to this, partners and employees of our firm deal
with the Company and its subsidiaries on normal terms within the ordinary course of trading activities
of the business of the Company and its subsidiaries. The firm has no other relationship with, or
interest in, the Company or any of its subsidiaries.
We consider materiality primarily in terms of the magnitude of misstatement in the financial
statements of the Group that in our judgement would make it probable that the economic
decisions of a reasonably knowledgeable person would be changed or influenced (the ‘quantitative’
materiality). In addition, we also assess whether other matters that come to our attention during the
audit would in our judgement change or influence the decisions of such a person (the ‘qualitative’
materiality). We use materiality both in planning the scope of our audit work and in evaluating the
results of our work.
We determined materiality for the Group financial statements as a whole to be $900,000.
Key audit matters are those matters that, in our professional judgement, were of most significance
in our audit of the consolidated financial statements of the current period. These matters were
addressed in the context of our audit of the consolidated financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
Opinion
Basis for opinion
Audit materiality
Key audit matters
Evaluation of cash flow forecasts supporting the use of the
going concern assumption
The financial statements have been prepared on a going
concern basis as discussed in note 1.2(a).
The Group reported revenues of $64.2 million, up from
$36.9m in 2020 and $61.7m in the previous year. However,
the Group also reported a loss before tax for the 2021 year of
$556,000 (2020: loss before tax of $1,975,000) and the Group
remains subject to higher than usual level of risk in the current
global environment including unexpected cost increases,
factory closures or capacity reductions due to the COVID-19
virus, suppliers unable to supply some critical components,
and unanticipated disruptions to supply.
In determining that the use of the going concern assumption
is appropriate, the Board of Directors prepared cash flow
forecasts to assess the Group’s ability to have adequate
resources to continue in operational existence, including
generating sufficient cash flows to pay its debts as they fall due
for a period of at least 12 months from the date of approval
of these financial statements. The Board has determined
that these cash flow forecasts are most sensitive to revenue
declines due to customer demand and gross margin pressure,
and delays in delivering products to customers due to the
impact of macroeconomic supply chain factors.
The cash flow forecasts used in the going concern assessment
are considered to be a key audit matter due to the high level
of judgement and estimation uncertainty, extent of auditor
attention and the importance to the financial statements as
a whole.
In assessing the appropriateness of the cash flow forecasts
used in the going concern assessment, our procedures
included, amongst others:
• Obtaining an understanding of the Group’s FY22 Budget
and FY23 – 26 forecasts and the controls and processes in
place for preparing and approving the cash flow forecast
to support the going concern assumption.
• Performing and evaluating inquiries and responses with
supply chain management to assess the Group’s responses
to supply chain issues, specifically the Group’s ability to
satisfy customers’ orders.
• Assessing the Group cashflow forecast prepared for a
period of at least 12 months from the date of approval
of the financial statements. This involved obtaining an
understanding of the inputs to the model and challenging
key judgements and assumptions, as follows:
-Assessing the reasonableness of forecast sales based
on our understanding of historical sales trends
including forecast volumes at a customer level
compared to historical levels;
-Challenging the reliability of the Group’s revenue
growth rates by comparing forecast growth rates
to historical forecasts and actual results. This also
included consideration of COVID-19 on both forecast
revenue and profitability of the Group;
-Assessing the operating, financing and capital cash
flow requirements of the Group over the forecast
period; and
-Performing sensitivity analysis over key assumptions
in the model such as forecast revenue, gross margin
and timing of new products being developed in light
of supply chain delays.
• Checking the mechanical accuracy of the cash flow
forecast.
• Reviewing the bank facility terms; including the Group’s
ability to meet repayment terms and comply with
covenant restrictions.
Key audit matterHow our audit addressed the key audit matter
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Capitalisation of internal development costs
The Group capitalised $2.0 million of internal development
costs (2020: $3.1 million), as set out in note 3.3 ‘Intangible
assets’. This includes capitalised employee and contractor
time.
Judgement is required to determine if the recognition criteria
to capitalise costs of development under NZ IAS 38 Intangible
Assets have been met. Key areas of judgement include
assessments of technical feasibility, likelihood of generating
future economic benefits and the availability of funding
necessary for completing the products.
We have included capitalisation of internal development
costs as a key audit matter due to the level of judgement
required to determine whether the costs meet the criteria for
capitalisation, the manual nature of the calculation and the
growing importance of development of IoT and new motor
products.
We have evaluated the appropriateness of internal
development costs capitalised by:
• Challenging the Group’s determination of which
development costs meet the criteria to be capitalised
under NZ IAS 38. We obtained an understanding of the
nature of the projects from management, including how
they are used in the business, the stage of development,
and the likelihood of the development being successfully
completed and used to generate revenue.
• Checking capitalisation of cost calculations for
mathematical accuracy.
• Testing the amounts capitalised on a sample basis and
agreeing this to underlying evidence, including, for
employee and contractor costs allocated to development
projects, testing a sample of hours worked on each project
and the relevant wage rates.
• Challenging the recoverability of capitalised costs by
assessing the reasonableness of management’s forecast
revenues in relation to each product
Key audit matterHow our audit addressed the key audit matter
The directors are responsible on behalf of the Group for the other information. The other information
comprises the information in the Annual Report that accompanies the consolidated financial
statements and the audit report.
Our opinion on the consolidated financial statements does not cover the other information and we do
not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and consider whether it is materially inconsistent
with the consolidated financial statements or our knowledge obtained in the audit or otherwise
appears to be materially misstated. If so, we are required to report that fact. We have nothing to
report in this regard.
The directors are responsible on behalf of the Group for the preparation and fair presentation of the
consolidated financial statements in accordance with NZ IFRS and IFRS, and for such internal control
as the directors determine is necessary to enable the preparation of consolidated financial statements
that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the directors are responsible on behalf of the
Group for assessing the Group’s ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis of accounting unless the directors
either intend to liquidate the Group or to cease operations, or have no realistic alternative but to
do so.
Our objectives are to obtain reasonable assurance about whether the consolidated financial
statements as a whole are free from material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance
but is not a guarantee that an audit conducted in accordance with ISAs and ISAs (NZ) will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these consolidated financial statements.
A further description of our responsibilities for the audit of the consolidated financial statements is
located on the External Reporting Board’s website at:
https://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/audit-
report-1
This description forms part of our auditor’s report.
This report is made solely to the Company’s shareholders, as a body. Our audit has been undertaken
so that we might state to the Company’s shareholders those matters we are required to state to them
in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than the Company’s shareholders as a body, for our
audit work, for this report, or for the opinions we have formed.
Other information
Auditor’s
responsibilities for
the audit of the
consolidated financial
statements
Restriction on use
Directors’
responsibilities for the
consolidated financial
statements
Paul Seller, Partner
for Deloitte Limited
Auckland, New Zealand
25 February 2022
This audit report relates to the consolidated financial statements of Wellington Drive Technologies Limited (the ‘Company’) for the year ended 31 December 2021
included on the Company’s website. The Directors are responsible for the maintenance and integrity of the Company’s website. We have not been engaged to
report on the integrity of the Company’s website. We accept no responsibility for any changes that may have occurred to the consolidated financial statements
since they were initially presented on the website. The audit report refers only to the consolidated financial statements named above. It does not provide an
opinion on any other information which may have been hyperlinked to/from these consolidated financial statements. If readers of this report are concerned with
the inherent risks arising from electronic data communication, they should refer to the published hard copy of the audited consolidated financial statements and
related audit report dated 25 February 2022 to confirm the information included in the audited consolidated financial statements presented on this website.
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Statutory information
Introduction
Directors have resolved that no dividend be declared.
The Company does not have a credit rating.
Remuneration of Directors
During the year the following remuneration was paid or payable to directors:
2021
2020
Mr J McMahon
1
$50,000$23,333
Mr G Pausch
2
$193,000$69,333
Mr K Oliver
3
$50,000$32,500
Mr J Scott $45,000$30,000
Mr G Allen
4
$109,008-
Dr L Jacobs
5
-$9,167
Note.
1. Fees for Mr J McMahon are paid to Meta Capital Ltd.
2. Fees for Mr G Pausch are paid to Board Advisory Services Ltd.
3. Fees for Mr K Oliver are paid to Alto Capital Ltd.
4. Mr G Allen was appointed a director on 30 October 2020. His fees are paid to RJ-Alpha Advisory Services Ltd.
5. Dr L Jacobs resigned with effect from 28 February 2020.
Interested transactions
The directors have disclosed the following transactions with the Company:
• Interested transactions: There have been no transactions during the year with interested or related parties of the
directors.
• Directors’ remuneration: Remuneration details of directors are provided above. Gottfried Pausch’s remuneration
includes a $151,179 consultancy fee paid for his interim Auckland-based executive role. Greg Allen’s remuneration
includes a $109,000 consultancy fee paid for the period from 1 April 2021 to 31 December 2021.
• Indemnification and insurance of officers and directors: The Company indemnifies directors and executive officers
of the Group against all liabilities which arise out of the performance of their normal duties as director or executive
officer, unless the liability relates to conduct involving lack of good faith. To manage this risk, the Group has
indemnity insurance. The total cost of this insurance expensed during the year ended 31 December 2021 was
$115,315 (2020: $98,214).
• Directors’ share transactions: Details of numbers of shares held by directors are shown below.
• Directors’ loans: There were no loans by the Company to directors.
• The Board received no notices during the year from directors requesting to use Company information received in
their capacity as directors which would not otherwise have been available to them.
Directors’ shareholding
31 December 2021 31 December 2020
Ordinary sharesTotal Relevant Interest
DirectTotal Relevant Interest Direct
Mr J McMahon19,178,253-19,178,253-
Mr J Scott-850,000-850,000
Mr G Allen-7,493,382-7,493,382
Mr G Pausch-2,416,6402,416,640
Employees
The number of employees, other than directors, within the Group receiving remuneration and benefits above
$100,000, as is required to be disclosed in accordance with section 211(1) (g) of the Companies Act 1993, is indicated
in the following table.
GroupGroup
2021202020212020
$100,000 - $109,999 46$210,000 - $219,999 22
$110,000 - $119,999 75$240,000 - $249,9991-
$120,000 - $129,999 44$250,000 - $259,99931
$130,000 - $139,999 42$270,000 - $279,9992-
$140,000 - $149,999 15$290,000 - $299,9991-
$150,000 - $159,99922$300,000 - $309,9992-
$160,000 - $169,99931$310,000 - $319,999-1
$170,000 - $179,999 12$320,000 - $329,9991-
$180,000 - $189,999 42$340,000 - $349,9991-
$190,000 - $199,999 21$390,000 - $399,999-1
$200,000 - $210,00023$440,000 - $449,9991-
In 2020, employee salaries were reduced during the period from May 2020 to December 2020 by agreement, as part
of the Company’s response to COVID-19. The amount of salary sacrifice was paid to employees in 2021. Payment
under the short-term incentive plan for the 2019 year (payable in 2020) was also delayed by agreement with relevant
employees until early 2021. It was paid in January 2021. The amounts paid to employees in 2021 include the
payments of salary sacrifice and the 2019 short-term incentive.
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Shareholder information
Shareholders
As at 31 December 2021 there were 2,723 shareholders holding 431,914,620 fully paid ordinary shares.
Share issues
There were no issues of shares in 2021.
Shareholder details
The ordinary shares of Wellington Drive Technologies Limited are listed on the New Zealand Stock Exchange. The
information in the disclosures below has been taken from the Company’s share register at 15 February 2022:
20 largest shareholders Ordinary Shares
1. East West Legacy LLC.55,149,807
2. Wairahi Investments Limited25,800,000
3. Ballynagarrick Investments Ltd21,185,103
4. Tea Custodians Ltd20,015,916
5. ASB Nominees Ltd (Meta Capital Ltd)19,178,253
6. HSBC Nominees (New Zealand) Ltd18,801,403
7. Hobson Wealth Custodians Ltd16,369,839
8. Graham Trustees Ltd16,092,744
9. FNZ Custodians Ltd10,475,396
10. New Zealand Depository Nominee Ltd9,303,392
11. Flynn No 2 Trustees Ltd8,564,758
12. Greg Allen6,488,049
13. BNP Paribas Nominees (NZ) Ltd6,135,089
14. Accident Compensation Corporation 6,000,000
15. JP Morgan Chase Bank NA New Zealand Branch4,901,165
16. Forsyth Barr Custodians Ltd4,278,935
17. Howard Duncan Milliner3,536,561
18. Lean Holdings Pty Ltd3,338,025
19. FNZ Custodians Ltd3,215,858
20. Circada Ltd3,200,000
20. Stephen Christopher Montgomery3,200,000
Distribution of equity securities
Size of holdings at 15 February 2022.
Shareholders Fully paid Ordinary Shares
Number%Number%
1-99985330.7273,5680.1
1,000-1,9992308.3301,6410.1
2,000-4,99934012.21,052,3260.2
5,000-9,9992639.51,775,8170.4
10,000-49,99960521.813,792,7543.2
50,000-99,9991766.311,910,4652.8
100,000-499,9992117.644,205,18910.2
500,000-999,999391.425,991,1066.0
over1,000,000602.2332,611,75477.0
2,777100.00431,914,620100.00
2,732 (or 98.4%) shareholders, holding 360,687,882 shares (or 95.0%) reside in New Zealand.
Substantial product holders
Pursuant to section 26 of the Securities Markets Act 1988, details of substantial product holders and their total relevant
interests as per their most recent notices are:
Name Number of shares
2
Date of notice
Jarden Securities Ltd & Harbour Asset Management Ltd48,823,48620 July 2021
Wairahi Investments Ltd26,120,2864 August 2021
East West Legacy, LLC55,149,80724 December 2021
2
Number of shares is taken from notices received. No adjustments have been made for changes that may have subsequently occurred from the
dates of notices stated. The definition of “relevant interest” in the Securities Markets Act 1988 provides that more than one relevant interest can
exist in respect of the same securities.
Shareholder enquiries
Shareholders should send changes of address to Computershare Investor Services Limited at the address noted
in the directory on page 108. Notification must be in writing. Questions relating to shareholdings should also be
addressed to Computershare Investor Services Limited. For information about the Group please contact the Company
at the registered office by sending an email to info@wdtl.com or visit our website http:/www.wdtl.com.
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Announcements to shareholders
The Company has established an email list of shareholders that wish to receive announcements made by the
Company to the New Zealand Stock Exchange. Announcements are emailed to shareholders who wish to receive
them shortly after they are released to the NZX. This will include the annual meeting addresses. If you wish to be
added to this listing, please email info@wdtl.com and advise us of your email address. Your email details will be
kept confidential.
Announcements are also posted on our website www.wdtl.com.
Corporate governance
The Board and Management of Wellington Drive Technologies Limited are committed to acting with integrity and
expect high standards of behaviour and accountability from all the Company’s officers and staff.
Role of the Board
The Board’s primary objective is the enhancement of shareholder value by following a set of core principles,
appropriate governance and ethical strategies and ensuring effective and innovative use of Company resources. The
Board is responsible for the management oversight, supervision and direction of the Group. Day-to-day management
of the Group is delegated to the Chief Executive Officer.
Compliance
The governance principles adopted by the Board are designed to meet best practice recommendations for listed
companies to the extent that they are appropriate to the size and nature of Wellington’s operations. The Board
endorses the overall principles embodied in the NZX Corporate Governance Code 2020 (the NZX Code) and believes
the Company’s corporate governance principles, policies and practices are appropriately aligned with the NZX Code.
The Company is reporting against the recommendations in the NZX Code, by describing below the corporate
governance policies and practices Wellington has in place and highlighting the small number of areas of the NZX
Code where we have not fully followed the Code’s recommendations.
Wellington takes a “continuous improvement” approach to corporate governance. Our governance programme
includes reviewing of policies and Board and committee charters, with the last major reviews having been completed
in 2020.
This statement is current to 23 February 2022 and has been approved by the Wellington Board of Directors.
Board and committee charters, codes and policies referred to in this section are available to view at www.wdtl.com/
governance.
NZX Code
Principle 1 – Code of ethical behaviour
The Company is committed to transparency and fairness in dealing with
all its stakeholders and to ensuring adherence to all applicable laws and
regulations. The Company expects its directors, officers, and employees
to maintain high standards of ethical conduct and expects employees
to act legally, ethically and with integrity in a manner consistent with
the policies and guiding principles that are in place. These include the
following:
• Code of Business Conduct and Ethics for Wellington team members and directors: Wellington team
members are committed to being ethically and socially responsible and our business decisions should reflect our
values, acting within the laws of the countries in which it operates. The code, which can be found at http://www.
wdtl.com/governance, provides a guide to these general principles of conduct and ethics. It brings together all
our policy principles and provides a working guide for directors and employees to do the right thing when making
decisions in our daily activities, and to:
√Act safely, ethically and responsibly
√Act in Wellington’s best interests always
√ Protect the confidentiality of Wellington’s business information
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Wellington Drive Technologies LtdWellington Drive Technologies Ltd
√Always comply with the principles in the Code, the legal and regulatory obligations in their country and the spirit of
the law
√Hold their colleagues accountable for behaving ethically and following the Code
√Not engage in any activity whether within or outside of the workplace that is likely to bring Wellington
into disrepute
√Deal honestly with Wellington’s people, customers, shareholders, suppliers and other stakeholders
√Ensure that they do not knowingly enter into transactions or make commitments on behalf of Wellington that the
Company cannot or does not intend to fully honour
√Undertake their duties with care and diligence
√ Ensure that any personal opinions Wellington people express are clearly identified as their own and are not
represented to be the views of the Company
√Value individuals’ differences and treat people with respect
√ To the best of their ability, ensure that Wellington’s records and documents, including financial reports, are true,
correct and conform to Wellington’s reporting standards and internal controls
√Not accept or offer bribes or improper inducements
√Speak up about unsafe or unethical behaviours
The Code includes a policy regarding a respectful workplace and diversity, requiring equal opportunity for all.
Wellington is committed to attracting, developing and advancing the best person for the role. Selection processes
for recruitment and employee development are unbiased and based on merit. Wellington values diversity and has a
workforce consisting of individuals with diverse skills, values, backgrounds, gender, ethnicity and experience. Any form
of discrimination, bullying or harassment is not tolerated.
Wellington takes the Code seriously. It is the responsibility of all Wellington people globally to promptly bring
suspected violations to the attention of the Company, for the benefit of all.
• Rules for Trading in Wellington Securities: The Rules for Trading in Wellington Securities, which can be found
at http://www.wdtl.com/governance, require all staff and directors to seek approval in accordance with the rules
before buying or selling any Wellington securities. The policy details “blackout periods” where trading is forbidden,
as well as a process for authorisation at all other times.
The Company has an ongoing programme to maintain employee awareness and understanding of these ethical
standards and policies.
Principle 2 – Board composition and performance
The Wellington Board comprises directors with an appropriate range
and mix of skills and experience; who have a proper understanding
of, and competence to deal with, current and emerging issues of
the business; and who can effectively review and challenge the
performance of management and exercise judgment independent of
management. The Board’s structure and governance arrangements are
set out in the Wellington Board Charter which can be found at http://
www.wdtl.com/governance.
The Wellington Constitution requires the Company to comply with the minimum Board composition requirements
of the NZ Stock Exchange which are that there must be at least three directors, and at least two directors must be
independent directors and two ordinarily resident in New Zealand. We assess director independence against the
“disqualifying relationship” criteria in the NZX Listing Rules. The Board currently has five directors, four of whom are
considered independent and one director, Greg Allen, who is not considered independent due to his recent role as
Chief Executive Officer of the Company.
Profiles of all directors and their dates of appointment are set out in the Directors section of this Annual Report on
pages 41 to 42 and are available on the Company’s website.
Attendance at meetings held during 2021 was:
Directors’ meetings
John
McMahon
Gottfried
Pausch
Keith
Oliver
John
Scott
Greg
Allen
Meetings held whilst a director1010101010
Attendance10101088
Audit and Risk Committee meetings
John
McMahon
Keith
Oliver
Gottfried
Pausch
Meetings held whilst a committee
member
221
Attendance221
As the Board is small, the Company has not established a separate nomination committee as recommended under
the NZX Corporate Governance Code, believing these matters are best dealt with by the full Board of Directors.
Periodically the Board evaluates its performance, composition, size, diversity and mix of skills. The method of review
is determined by the chairperson annually and may include interviews, questionnaires and/or external review. The
Board is satisfied that it is operating well and that the performance processes we have used are both effective and
suited to the Company.
When a decision is made to recruit a new director, the Board identifies candidates with a mix of capabilities and
perspectives considered necessary for the Board to carry out its responsibilities effectively. The Board also considers
the skills of the existing directors to ensure that the skills of the new director will complement and add to the
effectiveness of decision making. Appropriate pre-appointment checks are made on the background and suitability
of all directors. New Board members enter into a written agreement establishing the terms of their appointment.
A director appointed by the Board must stand for election at the next annual meeting. Listing Rule 2.7.1 requires
directors to stand for re-election on the later of three years and the third annual shareholders’ meeting after their
appointment. Retiring directors are eligible for re-election.
Year of director appointment:
Gottfried
Pausch
John
McMahon
Keith
Oliver
John
Scott
Greg
Allen
20132014201920192020
Directors undertake to attend appropriate education to remain current in how to best perform their duties as directors.
Directors are encouraged to attend courses and maintain membership of relevant bodies, such as the Institute
of Directors.
Directors receive information independently from management in relation to specific issues relevant to Wellington,
the markets in which the Company operates and to NZX listed companies generally. All directors have access to
Annual Report 2021Annual Report 2021
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Wellington Drive Technologies LtdWellington Drive Technologies Ltd
management for any additional information they consider necessary for informed decision making.
The Company recognises our people are critical to our business. Wellington has a very small number of employees, a
significant number of whom are based outside of New Zealand, which makes it challenging for the Company to adopt
any formal targets in relation to diversity as is recommended by the NZX Code. While we do not have any such formal
targets, Wellington values and respects the contributions, ideas and experiences of people from all backgrounds
and is proud to have a diverse company with staff from around the world and from many cultures. As stated, the
Company has a diversity policy included in its Code of Business Conduct and Ethics, and is committed to attracting,
developing and advancing the best person for the role. Recognising the small size of the Company, the Company’s
diversity policy does not include measurable objectives to be met, as recommended by the NZX Code. Attracting the
best person for a role may involve a global search for a suitable candidate and that selection may add to our diversity.
Wellington recognises diversity brings a range of ideas, skills and innovation to the Company, which is important to
the achievement of our objectives. The Board is generally not satisfied with the Company’s performance in relation to
diversity, and considers that the Company could improve its diversity at the senior management and board level and is
conscious of the benefits a diverse leadership team can provide to the business.
During 2022, the Company will continue to strive to ensure the best person for the role is identified in the recruitment
process for all positions becoming available and will strive to ensure it continues to improve diversity in its workforce.
It will ensure gender, race, sexual orientation, disability, age, religious or other bias are not present in hiring decisions.
The Company aims to encourage development of its existing staff through global re-deployment and training.
Diversity by gender statistics
In accordance with NZX Listing Rule 3.8.1 the Company makes the following diversity disclosures as at 31 December
2021:
MaleFemaleTotal
31 December 2021#%#%
Board5100%--5
Senior management team* 675%225%8
Other staff 6479%1721%81
Total Company 7580%1920%94
MaleFemaleTotal
31 December 2020#%#%
Board5100%--5
Senior management team* 788% 1 12%8
Other staff 6073% 2227% 82
Total Company 7276% 2324% 95
* The senior management team comprises of the Chief Executive Officer (CEO) and all the senior executives who report directly to the CEO. The
senior management team are “officers” for the purpose of the NZX Listing Rules.
Principle 3 – Board committees
The Board has established several committees to guide and assist
them with overseeing certain aspects of corporate governance.
These committees are the Audit and Risk Committee, the Technology
and Innovation Committee and the Executive Appointment and
Remuneration Committee. Each committee is empowered to seek
any information it requires from employees in pursuing its duties and
to obtain independent legal or other professional advice.
Audit and Risk Committee
The Audit and Risk Committee operates under a charter approved by the Board and assists the Board in: taking
reasonable steps to acquire and maintain up-to-date knowledge of enterprise risk management; overseeing the
quality and integrity of external financial reporting including the accuracy, completeness and timeliness of financial
statements; the appropriateness of accounting policies, areas of judgement, compliance with accounting standards,
stock exchange and legal requirements; and the business’s relationship with, and the independence of, the
external auditor.
The committee also approves any non-audit work carried out by the Company’s auditor and ensures that the lead
partner in the audit firm is rotated every five years.
The committee currently comprises three non-executive directors, all of whom independent and one of whom has
a financial or accounting background. The Chairman of the Committee is not also the Chairman of the Board.
Employees only attend meetings of the Audit and Risk Committee at the invitation of the Committee.
The current members are John McMahon (Committee Chairman), Keith Oliver and Gottfried Pausch.
The Audit and Risk Committee charter can be found at http://www.wdtl.com/governance.
Executive Appointment and Remuneration Committee
The Executive Appointment and Remuneration Committee operates under a charter approved by the Board and
assists the Board in; the remuneration and appointment of the senior executive team; management succession
planning; reviewing and approving compensation arrangements; establishing employee incentive schemes and the
remuneration of the Board. The committee also advises on proposals for significant company-wide remuneration
policies and programmes. In carrying out this role, the sub-committee operates independently of senior management
of the Company and, where appropriate, obtains independent advice on remuneration policy and packages.
The Committee must be comprised of at least a majority of independent directors. Employees only attend meetings of
the Executive Appointment and Remuneration Committee at the invitation of the Committee.
The current members are independent directors Keith Oliver (Committee Chairman) and Gottfried Pausch (Past
Committee Chairman).
The Executive Appointment and Remuneration Committee charter can be found at http://www.wdtl.com/governance.
Other committees
From time-to-time the Board may establish a committee to assist in the management of a matter or project.
The Company has established protocols for dealing with a takeover should an offer be received.
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Wellington Drive Technologies LtdWellington Drive Technologies Ltd
Health and safety
Whilst not a committee of Board members, Wellington has a Health and Safety Committee that meets monthly and
reports to the Board. The Company is strongly committed to maintaining a safe and healthy workplace and believes all
accidents are preventable. The committee is made up of a mix of senior management and staff from key operational
areas. The committee strives to; maintain and continually improve our health and safety systems; proactively identify
hazards and take all steps to eliminate or mitigate these; consult and actively promote participation in health and
safety matters throughout the Company.
The health and safety policy can be found at http://www.wdtl.com/governance.
Principle 4 – Reporting and disclosure
The Company is committed to ensuring integrity and timeliness of
its financial reporting and in providing information to the market and
shareholders.
Financial reporting
The Board has overall responsibility for ensuring the integrity of the
Company’s reporting to shareholders, including for financial statements
that comply with generally accepted accounting practice. The Audit
and Risk Committee assists the Board to fulfil its responsibilities in this
area. The committee makes enquiries of management and the external auditors (including requiring management
representations) so that the Company can be satisfied as to the validity and accuracy of all aspects of Wellington’s
financial reporting.
The CEO and CFO certify to the Board that: the annual report is true, and the statements therein are not materially
misleading; and no matters in the annual report would make any of the statements untrue or materially misleading.
Wellington strives to improve the clarity and readability of its financial statements, while continuing to comply with
all the requirements of the financial reporting standards including the Companies Act 1993, the Financial Markets
Conduct Act 2013, and the Listing Rules.
Continuous disclosure
The Company has a formal Group Market Disclosure Policy that can be found at http://www.wdtl.com/governance.
The policy seeks to promote investor confidence by ensuring that dealing in its securities takes place in an efficient,
competitive and informed market. The Company strives to ensure that all investors have equal and timely access to
market sensitive information. The Company considers that evenly balanced disclosure (during good times and bad)
is fundamental to building shareholder value and earning the trust of staff, customers, suppliers, communities
and shareholders.
The Board reviews and approves material announcements and specifically considers with management at each
Board meeting whether there are any issues which might require disclosure to the market under the NZX continuous
disclosure requirements.
Trading in shares
Wellington is committed to transparency and fairness in dealing with all its stakeholders and to ensuring adherence to
all applicable laws and regulations.
Wellington has a detailed share trading policy, the Rules for Trading in Wellington Securities that can be found at
http://www.wdtl.com/governance, which applies to all directors and employees. No director or employee may use
confidential non-public price sensitive information in his or her position to engage in securities trading for personal
benefit or to provide benefit to any third party. Short-term trading in Wellington shares and buying or selling (while in
possession of non-public price-sensitive information) is strictly prohibited.
Given the small size of the Company, all directors and employees must obtain consent to trade in securities prior to
trading. All members of the Board need to consent to the application. Once these consents have been received the
Chair of the Wellington Board or (where the Chair is unavailable) the Chair of the Board’s Audit and Risk Committee,
will approve or decline the application. The Company monitors trading and reports share movements to the Board at
every meeting.
Information for investors
Wellington’s investor website http://www.wdtl.com/news-and-information includes the Company’s reports, investor
communications, audio and video releases and the Policies and Charters referred to in this section. The Annual and
Interim Reports are available in electronic and hard copy format.
Principle 5 – Remuneration
The Executive Appointment and Remuneration Committee is
responsible for ensuring directors and executives receive the
appropriate rewards to support Wellington in achieving its commercial
and stakeholder goals. The Executive Appointment and Remuneration
Committee has a formal charter. Its membership and role are set out
under Principle 3 above.
Director remuneration
Directors’ fees are intended to be aligned with other organisations of similar scale and complexity. Directors’ fees are
currently set at a maximum aggregate cap of $400,000 per annum. This was approved by shareholders at the 2019
Annual Meeting. Directors’ fees paid in the 2021 financial year amounted to $186,821 due to the small size of the
Board, and the fact that Directors forwent part of their fees during the year in response to COVID-19. Full disclosure
of director remuneration is set out on page 89. Gottfried Pausch received a consulting fee in 2021 of $151,179 for
his interim Auckland based executive role with the Company. Greg Allen received remuneration for his role as Chief
Executive Officer until 31 March 2021 and a consultancy fee of $109,008 for the period from 1 April 2021 to 31
December 2021. Greg Allen did not receive director fees in 2021. His director fees commenced on 1 January 2022,
upon expiry of his consultancy. Other than as disclosed here, no director is entitled to any other remuneration or
retirement benefits from Wellington. Directors are entitled to be reimbursed for reasonable travel, accommodation and
other expenses incurred by them in connection with their attendance at Board or shareholder meetings or otherwise in
connection with Wellington business.
The Executive Appointment and Remuneration Committee conducts a regular review of directors’ fees, to determine
whether the level of fees paid to the Company’s chairperson and other non-executive directors is aligned with other
organisations of similar scale, scope and complexity. The next review is scheduled for early 2022. Any increases
in fees paid to directors must be authorised by the Board and be within the above aggregate cap approved by
shareholders.
Executive Remuneration Policy
Wellington’s approach is to pay a base salary and a performance-based bonus that includes a short-term and a
long-term incentive component. This ensures executive motivation is aligned with the goals of the Company in the
short and long term.
Base salary
As stated above, the Company recognises our people are critical to our business and its growth strategies.
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Wellington Drive Technologies LtdWellington Drive Technologies Ltd
Wellington’s remuneration strategy is to pay executives a remuneration that is fair and reasonable in a competitive
market for the skills, knowledge and experience required by the Company. Salaries are determined for their current
position in the market using relevant and up to date market benchmark data and an individual’s performance and are
reviewed annually. Many of our employees are based outside of New Zealand and remuneration varies by location in
accordance with the local market.
Short-Term Incentive
Our Short-Term Incentive (STI) model is focused on delivering financial and business improvement performance
goals, predicated on measurable outcomes, differentiating high performance, and rewarding delivery. The STI
programme applies only to key management and other selected staff members. STI values are calculated as a
percentage of base salary, ranging between 10% to 33% for eligible employees. Executive team STI payments are
determined following a Board level review of the Company’s and the individual’s performance and may be paid out at
between zero to 100% of an individual’s STI target. It is possible for an executive to achieve 200% on financial metrics
if targets are substantially overachieved.
Employee share purchase plans
Wellington has two Long Term Incentive (LTI) share purchase plans, a partly paid share scheme which has been
operating since 2008 and the United States employee share option plan which has operated since 2010. There are no
partly paid share issues or options currently outstanding.
The Company intends to review its long-term incentive plans to ensure that the Company continues to have plans that
are fit for the purpose of retaining and attracting the right talent for the business.
CEO remuneration
The following tables sets out the payments made to the CEO during FY2021.
Greg Allen – CEO until 31 March 2021
Fixed remuneration$220,950
Short term incentive for 2019, paid in January 2021$131,321
Total remuneration$352,271
The Greg Allen’s STI payment for the FY2019 year was $121,224. Payment was made in January 2021 with accrued
interest of $10,097. STI targets for FY2020 were not achieved.
Greg Balla – CEO from 8 August 2021
Fixed remuneration$214,360
Total remuneration$214,360
Greg Balla does not participate in the Company’s STI programme. He has been issued 12,930,000 share options
representing 2.99% of the Company’s ordinary shares at the time of issue. Provided he is a full-time employee at that
date, 8.62 million options shall vest on 1 October 2024 and may be exercised within 18 months following 1 October
2024 at an exercise price of 9.1 cents per share. Provided he is a full-time employee on 1 October 2025, a further 4.31
million options shall vest on 1 October 2025 and may be exercised within 18 months of that date at an exercise price
of 11.5 cents per share.
Principle 6 – Risk management
The identification and effective management of the Company’s risks are
a priority of the Board.
As discussed above, the Board has established an Audit and Risk
Committee to assist the Board with its oversight, monitoring and review
of risk. Bi-annually there is a review of the entire risk landscape to
establish a forward-looking perspective on business risks, both financial
and non-financial, in both the internal and external environment.
The committee provides a forum for discussion of risk, including the Board’s appetite for risk, with the CEO and
management. The CEO and senior management team are required to regularly identify the major risks affecting the
business and to develop strategies to mitigate these risks. Significant risks are discussed at each Board meeting, or
as required.
The Company maintains insurance policies that it considers adequate to meet the insurable risks of the Group.
Exposure to any foreign exchange risk is managed in accordance with policies laid down by the Board.
The Health and Safety Committee meets monthly and reports to the Board on health, safety and wellbeing matters.
Minutes of the Health and Safety Committee are a priority agenda item at all Board meetings and specific reviews
are sought as required. The committee continuously reviews health and safety risks and systems used to identify
and manage those risks, ensuring they are fit for purpose, are being effectively implemented, regularly reviewed and
improved. The frequency of incidents has been low and no Accident Compensation claims involving the Company
have been recorded for several years. The Board undertakes ongoing health and safety education and visits key
operational sites on a regular schedule.
Principle 7 – Auditors
Oversight of Wellington’s external audit arrangements is the
responsibility of the Audit and Risk Committee.
The Company has adopted a policy to ensure that audit independence
is maintained, both in fact and appearance, such that Wellington’s
external financial reporting is viewed as being reliable and credible. The
policy covers the following areas:
• The external auditor must always remain independent of the Company and comply with the New Zealand Institute
of Chartered Accountants’ (NZICA) Code of Ethics
• The external auditor must monitor its independence and report to the Board that it has remained independent
• Guidelines in relation to the provision of non-audit services by the external auditor in order that the provision of
such services does not impair the external auditor’s independence or objectivity
• The audit firm may be permitted to provide non-audit services that are not considered to conflict with the
preservation of the independence of the auditor subject to the approval of the Audit and Risk Committee
• The Audit and Risk Committee must approve significant permissible non-audit work assignments that are awarded
to an external auditor
Deloitte is the existing auditor of the Company and was automatically re-appointed by virtue of section 207T of the
New Zealand Companies Act 1993.
During 2021 other services provided by Deloitte amounted to $49,000 relating to tax compliance services.
To ensure full and frank dialogue between the Audit and Risk Committee and the auditors, the auditor’s senior
Annual Report 2021Annual Report 2021
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Wellington Drive Technologies Ltd
representatives meet separately with the committee (without management present) at least twice a year, including
immediately before finalisation and release of the Company’s half-year and full-year financial results to the market.
Due to its small size, the Company does not have an internal audit function as is recommended by the NZX Code. As
discussed above, the CEO is accountable for all operational and compliance risks across the Company’s operations
and businesses. The CFO has management accountability for the effective control, implementation and improvement
of internal systems and controls.
Representatives of the Company’s external auditor, Deloitte are invited to attend the annual shareholders meeting
where they are available to answer shareholders’ questions relevant to the audit.
Principle 8 – Shareholder rights and relations
The Board’s policy is to ensure, in an open and transparent manner,
that shareholders are informed of all major and strategic developments
affecting the Company.
We provide information about who we are, including our governance
policies, on our website for investors to access at any time.
The Company releases all material information via the NZX in
accordance with its continuous disclosure requirements. All major
disclosures are also posted on the Company’s website (http://www.wdtl.com/news-and-information) on a timely
basis. Audio files of investor conference calls held with institutional and large investors are also available on the
Company’s website.
Shareholders can directly communicate with the Company via http://www.wdtl.com/contact-investors. Our CEO and
CFO also respond directly to shareholder phone calls and emails.
Shareholders are encouraged to receive all shareholder communications by email. The Company provides a printed
copy of its Interim and annual reports to shareholders who have elected to receive printed copies. Interim and annual
reports are available on the Company’s website in accordance with the requirements of the NZ Companies Act 1993.
The Company’s share register is managed and maintained by Computershare. Shareholders can access their
shareholding details or make enquiries about their current shareholding interests electronically.
Notices of annual meetings are made available as soon as possible and posted on the website of the Company
usually more than one month prior to the meeting. However, the Company has not typically been able to post the
notices on its website within 20 working days prior to the meetings, as recommended by Recommendation 8.5 of the
NZX Corporate Governance Code. The reason for this in 2021 was due to the challenges posed by COVID-19.
The annual meeting for the 2021 year is planned to be held on 25 May 2022. Due to COVID-19 considerations,
the annual meeting may be held virtually, as was the case in 2020. All shareholders are welcome to attend and ask
questions, whether or not the meeting is held virtually or in person or appoint a proxy on their behalf, or submit a
postal vote, if they are unable to attend. The external auditor, Deloitte will be in attendance to answer questions about
the audit and their audit report.
Shareholders are encouraged to attend, participate and vote at meetings. Results of proxies and postal votes are
summarised and disclosed at the meeting. Results of meetings are announced on the NZX as soon as possible
following the closure of the shareholder meeting.
Annual Report 2021Annual Report 2021
Contacts
Wellington offices
New Zealand (Head office)
Wellington Drive Technologies Ltd
21 Arrenway Drive
Rosedale, Auckland 0632
New Zealand
Postal Address
P.O. Box 302 – 533
North Harbour
Auckland 0751, New Zealand
Ph: 64-9-477 4500
Mexico
Wellington Latin America Services SA de CV
San Serafin No. 4
Residencial San Gil
San Juan del Rio, Qro,
Mexico 76815
PO Box 57
San Juan del Rio
Querétaro
Mexico 76800
Ph: +52 427 167 3857
Brazil
Wellington Drive Technologies (Brazil)
Rua Xamim, 370 - Iririu
Joinville, SC
Brazil 89227917-315
Ph: +55 47 3028 3858
Wellington Drive Technologies Ltd
Turkey
Wellington Motor Teknolojileri San Tic Ltd. Sti.
Fatih Sultan Mehmet Mah.
Poligon Cad. No: 8C
Buyaka Kule 3 Kat:11 Daire:70
Tepeüstü 34771 Umraniye – Istanbul
Ph: +90 0 (216) 420 12 02
Fax: +90 0 (216) 420 12 05
Phone/fax
Ph: 64-9-477 4500
Fax: 64-9-479 5540
Internet and social media
Website: www.wdtl.com
Email: info@wdtl.com
LinkedIn
Twitter
Address and registered office
21 Arrenway Drive
Rosedale, Auckland 0632, New Zealand
PO Box 302-533, North Harbour,
Auckland 0751, New Zealand
Auditor
Deloitte Limited
80 Queen Street, Auckland CBD, Auckland 1010
Banker
Bank of New Zealand
Share registry
Computershare Investor Services Ltd,
Private Bag 92119,
Auckland 1142,
New Zealand
Annual Report 2021
www.wdtl.com
WT9621
Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.
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