FY23 Annual Report

28 August 2023
announce@nzx.com
The Directors of Allied Farmers Limited (“Allied Farmers” or “Allied Group”) (ALF:NZX) are pleased to
report an audited net profit before tax for the year to 30 June 2023 of $4.071 million (FY22 $3.556
million), with an audited net profit after tax attributable to Allied Farmers’ shareholders of $3.338
million (FY22 $2.876 million) which was an increase of 16.06% from the previous year.
Before commenting on the result, the Allied Board wishes to acknowledge the passing in November
2022 of Mark Franklin. At that time he was Allied Farmers Chair. Mark was a highly experienced and
principled businessman, whose strength of leadership and strategic insight was invaluable.
The increased FY23 profit was driven by increased returns from NZ Farmers Livestock (NZFL) - largely
from veal processing - but offset by lower transaction and performance fees from NZ Rural Land
Management (NZRLM). A segmental contribution comparison is provided below which reflects the
contribution to Allied Farmers of our two principal investments and our holding company operating
and financing costs:
Segmental Contribution
attributable to Allied Farmers’
Shareholders ($ 000’s)
FY 2023 FY 2022
NZ Rural Land Management
(NZRLM)
1,138 1,624
NZ Farmers Livestock +
Finance (NZFL)
2,407 1,722
Allied Farmers (Parent) (207) (470)
Allied Farmers NPAT 3,338 2,876
Commentary on the results for NZRLM and NZFL business units are set out in the following
sections.
Allied Farmers’ earnings per share (EPS) increased by 16.1% to 11.59 cents per share (FY22
9.98cps), and Net Tangible Assets (NTA) per share, based on 67.8% direct ownership of NZFL and

The acquisition in March this year of the 50% balance of NZRLM led to governance changes, with
NZRLM co-founder Richard Milsom appointed Managing Director, and Shelley Ruha accepting the
role as Chair to replace retiring Chair, Chris Swasbrook. Allied Farmers’s secured external debt
funding for the first time in many years to partly fund the acquisition, improving Allied Farmers’s
capital funding mix.
In FY22 Allied Farmers implemented initiatives to reduce several recurring corporate costs. The full
benefit of these recuring cost reductions has been realised in FY23 (noting that the FY23 Parent
Company costs include one off advisory costs associated with the NZRLM acquisition and determining
the tax loss position).
The Directors will update at the Annual Meeting in November as to whether a dividend will
be paid.
New Zealand Rural Land Management (NZRLM) - 100% owned:
NZRLM is the external manager of NZX listed New Zealand Rural Land Company (NZL). NZL currently
owns 1 4,847 hectares of rural land and forest estates, an increase of 3,137 hectares during FY23.
On 27 March 2023 Allied Farmers’s acquired the 50% of NZRLM not already owned, having exercised
its call option on 19 December 2022. The purchase price was $8.3 million as determined by an
independent valuation undertaken by PwC in accordance with the terms of the call option agreement.
The purchase price was satisfied by the payment to the vendors of $6.55 million of cash (funded by a
loan from Heartland Bank), and the transfer to the vendors of 1,800,227 NZL shares owned by Allied at
their 20-day volume weighted average price prior to completion date of $0.9721 per share, being a
total of $1.75 million.
Allied Farmers’s total acquisition cost for 100% of NZRLM is $10.8 million ($2.5 million for the initial 50%
in December 2020, and $8.3 million for the remaining 50%), compared to the PwC valuation of $16.6
million. Coupled with the return on investment to date, this has been a significantly value accretive
investment for Allied.
NZRLM’s FY23 income is lower than FY22. During FY22 NZRLM managed the acquisition of a significant
number of large-scale assets that generated significant transaction fees for NZRLM, and there was a
significant increase in the value of NZL’s overall portfolio of +16.7%, from which NZRLM received
performance fees. NZL’s only acquisition in FY23 was of a forest estate located in Manawatū-
Whanganui, resulting in a lower level of income from transaction fees compared to FY22, and a lower
percentage increase in the value of the NZL portfolio (also affected by a change in NZL’s balance date
to 31 December) resulted in a lower level of income from performance fees.
This reduced income was partially offset by an increase in the ongoing management fee income
100% ownership of NZRLM, equals $0.21 per share (FY22 $0.48 per share).

The performance fees are paid to NZRLM by the issue of NZL shares to the owners of NZRLM. Allied
Farmers currently owns 2,803,617 NZL shares (~2% of NZL shares on issue).
Notwithstanding the lower FY23 NZRLM income, Allied is pleased with its performance, particularly
given the fee assumptions used in the PWC valuation to determine the consideration paid to acquire
the 50% of NZRLM not already owned.
New Zealand Farmers Livestock Limited (NZFL) – 67.8% owned:
Each of the NZ Farmers Livestock business areas – Livestock Agency, Veal and Finance – improved on
the prior year to achieve consolida
ted earnings 41.1% ahead of the prior year.
That said, the performance has been overshadowed by the loss of our livestock agent Mark Howells in a
road accident in June. Directors and staff reiterate our deepest sympathies to his family and friends.
The livestock agency business was again challenged, with difficult weather, some reduction in meat and
dairy market prospects, the impact of stock processing space constraints, and plenty of grass through
the summer making for an unusual year. The business’s primary exposure to Cyclone Gabrielle was via
our interest in Redshaw Livestock, and it is notable that this team performed extremely well as it
supported clients through the major disruptions involved. While slightly behind expectations, the agency
business saw encouraging progress on yard market shares, and continued to progress the online auction
and other digital developments that are increasingly important tools for our team and clients, and
future-proof this core area of our activity.
The veal business, reflecting good product market returns, again returned an excellent result,
appreciably ahead of both expectations and last year.
The NZ Farmers Livestock livestock financing activity combines a referral business funded by Heartland
Bank and short-term bull, lamb and other livestock financing conducted with the support of our main
business banker. We are pleased with progress across all aspects of this business and contemplate
ongoing growth in lending, and important support of clients in the challenging farming environment.
The Board wish to thank and acknowledge the hard work and initiative of our NZFL and NZRLM teams
over the last year.
Shelley Ruha - Chair
received by NZRLM for managing the NZL properties.

---

Annual Report
for the year ended 30 June 2023
www.alliedfarmers.co.nz
Listed on:

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CONTENTS
HISTORY
01 History
BUSINESS
OVERVIEW
02 Business
Overview
CHAIR
REPORT
04 Chair Report
4 5 6
DIRECTORS STATUTORY
DISCLOSURES
07 Directors’ 09 Statutory
Disclosures
CONSOLIDATED
FINANCIAL
STATEMENTS
21 Consolidated Financial Statements
INDEPENDENT
AUDITOR’S
REPORT
41 Independent Auditor’s
Report
COMPANY
DIRECTORY
46 Company Directory
This report is dated 28 August 2023 and is signed on behalf of the Board of Allied Farmers Limited:
Shelley Ruha – Chair Richard Milsom - Managing Director
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1
HISTORY
Allied Farmers Limited (ALF.NZX) is a NZX-listed investment company that has a legacy
dating back to 1889 with the formation of The Egmont Farmers’ Union Limited as a stock
and station company. This company was ultimately sold to Hawera based The Farmers’
Co-operative Organisation Society of New Zealand Limited, and 1914 is the recorded
s
tarting date of the company today. In 1997, the company changed its name to Allied
Farmers Limited. Allied Farmers listed on the NZX in 2002 (after having traded on
the NZX’s unlisted security facility since 1998) and throughout its history of providing
services to the agricultural sector has also operated as an agricultural investment
company with strategic stakes in livestock trading, meat, wool, lumber, finance and retail
rural supplies.
Allied Farmers Limited today is an investment company focused on the agricultural
sector with two principal investments - a 67.8% shareholding in New Zealand Farmers
Livestock Limited (NZFL) and 100% ownership of New Zealand Rural Land
Management Partnership (NZRLM), the Manager of NZX- listed company New Zealand
Rural Land Company (NZL.NZX).
To learn more about Allied Farmers’ extensive history, please visit our website:
https://www.alliedfarmers.co.nz/timeline
1

BUSINESS
OVERVIEW
Businesses:
Allied Farmers is a NZX-listed investment company with two investments in the rural sector.
Asset Management:
A
llied Farmers owns 100% of New Zealand Rural Land Management Limited Partnership (NZRLM), having
on 27 March 2023 acquired the 50% of NZRLM not already owned.
NZRLM provides management, investment and administrative services to NZX listed New Zealand Rural Land
Company Limited (NZL) pursuant to a Management Agreement. NZL owns and leases rural land to tenants to
provide shareholders with superior risk-adjusted returns compared to legacy rural investment vehicles.
Livestock Services:
A
llied Farmers owns 67.8 % of national livestock agency business, NZ Farmers Livestock Limited (NZFL). A
mix of NZFL agents and staff own the balance of NZFL.
N
ZFL’s core businesses are livestock agency, which generates commission revenue from the marketing,
purchase, sale and financing of livestock for clients, and exporting processed veal.
Strategy:
Allied Farmers is an investment vehicle focused on delivering earnings per share growth for shareholders by:
•providing strategic guidance and support to its investments to ensure that their business
strategies are designed to deliver sustainable earnings growth in line with Allied Farmers’s
expectations; and
•exploring growth opportunities that leverage its core strengths in the rural and asset
management sectors.
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Tax Losses:
Allied Farmers has a valuable tax loss asset which was the result of legacy investments in the finance sector.
During FY23 Allied obtained a Private Ruling from Inland Revenue under s 91E of the Tax Administration Act
1994 that significantly increased these tax losses.
As a r
esult of the ruling, Allied Group unrecognised deferred tax assets comprise unused tax losses as at 30
June 2023 total $180,785,199 gross (2022: $36,288,403).
The ability to utilise the tax losses is dependent on meeting shareholder continuity requirements of prevailing
tax legislation, and the Allied Farmers’ Board is acutely aware of maintaining both business and shareholder
continuity to preserve this valuable asset for shareholders and any future transactions will be structured with
this in mind.
Five Year Earnings Summary:
Financial Year Ending 30 June FY
2023
FY
2022
FY
2021
FY
2020
FY
2019
Allied Farmers Net Profit After Tax (NPAT)
- attributable to Allied Farmers shareholders - $
000’s
3,338 2,876 2,021 767 1,258
Allied Farmers Earnings Per Share – cents per
share
11.59 9.98 8.57 4.30 7.58
Allied Farmers Dividend Per Share – cents per
share
- - - 1.2 2.0

Comprising
NZFL incl. Finance - earnings attributable to
Allied Farmers shareholders* - $ 000’s
2,407 1,722 1,370 1,175 1,764
NZRLM - earnings attributable to Allied
Farmers shareholders - $ 000’s
1,138 1,624 1,152 - -

Allied Farmers Holding Co (Parent)** - $ 000’s
(207)(470)(501)(408)(506)
* Recognises Allied Farmers’ 67.8% NZFL ownership and 52% Redshaw Livestock ownership.
** In FY 2023 from Parent Operations loss of $779,000 (FY 2022: $699,000) disclosed in Note A1 of the Financial
Statements, tax benefits of $572,000 (FY2022: $230,000) received by the Parent arising from tax losses are
deducted.

SECTION 2. BUSINESS OVERVIEW
3

SECTION 3. CHAIR REPORT
CHAIR
REPORT
The Directors of Allied Farmers Limited (“Allied Farmers” or “Allied Group”) (ALF:NZX) are pleased to report
an audited net profit before tax for the year to 30 June 2023 of $4.071 million (FY22 $3.556 million), with an
audited net profit after tax attributable to Allied Farmers’ shareholders of $3.338 million (FY22 $2.876 million)
which was an increase of 16.06% from the previous year.
Before commenting on the result, the Allied Board wishes to acknowledge the passing in November 2022 of
Mark Franklin. At that time he was Allied Farmers Chair. Mark was a highly experienced and principled
businessman, whose strength of leadership and strategic insight was invaluable.
The increased FY23 profit was driven by increased returns from NZ Farmers Livestock (NZFL) - largely from
veal processing - but offset by lower transaction and performance fees from NZ Rural Land Management
(NZRLM). A segmental contribution comparison is provided below which reflects the contribution to Allied
Farmers of our two principal investments and our holding company operating and financing costs:
Segmental Contribution attributable to
Allied Farmers’ Shareholders ($ 000’s)
FY 2023 FY 2022
NZ Rural Land Management (NZRLM) 1,138 1,624
NZ Farmers Livestock + Finance (NZFL) 2,407 1,722
Allied Farmers (Parent) (207) (470)
Allied Farmers NPAT 3,338 2,876
Commentary on the results for NZRLM and NZFL business units are set out in the following sections.
Allied Farmers’ earnings per share (EPS) increased by 16.1% to 11.59 cents per share (FY22 9.98cps),
and Net Tangible Assets (NTA) per share, based on 67.8% direct ownership of NZFL and 100%
ownership of NZRLM, equals $0.21 per share (FY22 $0.48 per share).
The acquisition in March this year of the 50% balance of NZRLM led to governance changes, with NZRLM
co-founder Richard Milsom appointed Managing Director, and Shelley Ruha accepting the role as Chair to
replace retiring Chair, Chris Swasbrook. Allied Farmers’s secured external debt funding for the first time in
many years to partly fund the acquisition, improving Allied Farmers’s capital funding mix.
In FY22 Allied Farmers implemented initiatives to reduce several recurring corporate costs. The full benefit of
these recuring cost reductions has been realised in FY23 (noting that the FY23 Parent Company costs
include one off advisory costs associated with the NZRLM acquisition and determining the tax loss position).
The Directors will update at the Annual Meeting in November as to whether a dividend will be paid.
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SECTION 3. CHAIR REPORT
New Zealand Rural Land Management (NZRLM) - 100% owned:
NZRLM is
the external manager of NZX listed New Zealand Rural Land Company (NZL). NZL currently owns
14,847 hectares of rural land and forest estates, an increase of 3,137 hectares durin g FY23.
On 27 March 2023 Allied Farmers’s acquired the 50% of NZRLM not already owned, having exercised its call
option on 19 December 2022. The purchase price was $8.3 million as determined by an independent valuation
undertaken by PwC in accordance with the terms of the call option agreement. The purchase price was satisfied
by the payment to the vendors of $6.55 million of cash (funded by a loan from Heartland Bank), and the transfer
to the vendors of 1,800,227 NZL shares owned by Allied at their 20-day volume weighted average price prior
to completion date of $0.9721 per share, being a total of $1.75 million.
Allied Farmers’s total acquisition cost for 100% of NZRLM is $10.8 million ($2.5 million for the initial 50% in
December 2020, and $8.3 million for the remaining 50%), compared to the PwC valuation of $16.6 million.
Coupled with the return on investment to date, this has been a significantly value accretive investment for Allied.
NZRLM’s FY23 income is lower than FY22. During FY22 NZRLM managed the acquisition of a significant
number of large-scale assets that generated significant transaction fees for NZRLM, and there was a significant
increase in the value of NZL’s overall portfolio of +16.7%, from which NZRLM received performance fees.
NZL’s only acquisition in FY23 was of a forest estate located in Manawatū-Whanganui, resulting in a lower level
of income from transaction fees compared to FY22, and a lower percentage increase in the value of the NZL
portfolio (also affected by a change in NZL’s balance date to 31 December) resulted in a lower level of income
from performance fees.
This reduced income was partially offset by an increase in the
ongoing management fee income received by
NZRLM for managing the NZL properties.
The performance fees are paid to NZRLM by the issue of NZL shares to the owners of NZRLM. Allied
Farmers currently owns 2,803,617 NZL shares (~2%
of NZL shares on issue).
Notwithstanding the lower FY23 NZRLM income, Allied is pleased with its performance, particularly given
the fee assumptions PWC used in the valuation to determine the consideration paid to acquire the 50% of
NZRLM not already owned.
5

SECTION 3. CHAIR REPORT
New Zealand Farmers Livestock Limited (NZFL) – 67.8% owned:
Each of the NZ Farmers Livestock business areas – Livestock Agency, Veal and Finance – improved on
the prior year to achieve consolidated earnings 41.1% ahead of the prior year.
That said, the performance has been overshadowed by the loss of our livestock agent Mark Howells in a road
accident in June. Directors and staff reiterate our deepest sympathies to his family and friends.
The livestock agency business was again challenged, with difficult weather, some reduction in meat and dairy
market prospects, the impact of stock processing space constraints, and plenty of grass through the summer
making for an unusual year. The business’s primary exposure to Cyclone Gabrielle was via our interest in
Redshaw Livestock, and it is notable that this team performed extremely well as it supported clients through the
major disruptions involved. While slightly behind expectations, the agency business saw encouraging progress
on yard market shares, and continued to progress the online auction and other digital developments that are
increasingly important tools for our team and clients, and future-proof this core area of our activity.
Th e veal business, reflecting good product market returns, again returned an excellent result, appreciably ahead
of both expectations and last year.
The NZ Farmers Livestock livestock financing activity combines a referral business funded by Heartland Bank
and short-term bull, lamb and other livestock financing conducted with the support of our main business banker.
We are pleased with progress across all aspects of this business and contemplate ongoing growth in lending,
and important support of clients in the challenging farming environment.
The Board wish to thank and acknowledge the hard work and initiative of our NZFL and NZRLM teams over the
last year.
Shelley Ruha - Chair
6

4
DIRECTORS

Shelley Ruha - Independent Chair
Shelley was appointed a Director of Allied Farmers Limited in November 2022, and Chair in April 2023. Prior to
her Director appointment, Shelley was the Independent Chair of NZ Rural Land Management GP and LP.
Shelley is a Company Director and Investor with 30 years’ experience across a variety of industries. She Chairs
PaySauce and TaxGift and is
a director of Heartland Bank, Hobson Wealth, Partners Life, and 9 Spokes.
Previous directorships include Paymark, JB Were and The Icehouse. Shelley has a Bachelor of Commerce.
Philip Luscombe - Independent Director
Philip was appointed a Director of Allied Farmers Limited in December 2005 and is Chair of New Zealand
Farmers Livestock Limited. As a former Agricultural Research Scientist, and with a broad farming background,
he has extensive experience in the agricultural sector. He is a shareholder and Chair of the Argyll Dairy Farm
group of farms in Otago, a partner in the family dairy farm in Taranaki, and has interests in farm forestry. He is
a trustee of The Massey-Lincoln and Agricultural Industry Trust, and is an Independent Director of dairy farming
business, Te Rua O Te Moko Limited. He is a former director of PKW Farms Ltd, Kiwi Cooperative Dairies
Limited, Kiwi Milk Products Limited, Dairy Insight, Dexcel, and NZAEL Limited. Mr. Luscombe is an independent
director. He has the following qualifications: BAgSci(Hons).
Richard Milsom – Managing Director
Richard was appointed Managing Director of Allied Farmers Limited in April 2023. Richard is one of the founders
and executives of New Zealand Rural Land Management and NZX-listed New Zealand Rural Land Company.
He was previously a consultant at global investment management firm Elevation Capital Management, where
he focused on special situation investments. Richard has been involved in a number of industries including
tourism, agriculture/ biotechnology and fine art auction houses – in functions ranging from finance, to marketing,
strategy, strategic review and implementation. Richard was previously on the board of the Institute of Finance
Professionals New Zealand (INFIZ) and was recognised within the financial services industry by being awarded
the INFINZ Emerging Leader Award 2017. Richard is not an independent director. He holds a BCom in finance
and economics from the University of Canterbury, with post-graduate certificates in value investing from
Columbia University (New York), and agricultural businesses and leadership from Harvard Business School
(Boston).
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Note: Former Director Chris Swasbrook resigned from the Board with effect from 5 April 2023, and former
Director and Chair Mark Franklin passed away in November 2022.
Director Independence:
As at 30 June 2023, Shelley Ruha and Philip Luscombe are considered by the Board to be independent
directors. Deceased Director Mark Franklin was also considered to be an independent director. They are/were
considered to be independent due to the following factors:
•They are/were non-executive directors who are not substantial shareholders and who are free of any
interest, business or other relationship that would materially interfere with, or could reasonably be
seen to materially interfere with, the independent exercise of their judgement;
•They have not been employed or retained, within the last three years, to provide material professional
services to the Company;
•Within the last 12 months, they were not a partner, director, senior executive or material shareholder
of a firm that provided material professional services to the Company or any of its subsidiaries; and
•None of those directors:
ohave been, within the last three years, a material supplier to the Company or
have any other material contractual relationship with the Company or another
group member other than as a director of the Company;
oreceive performance-based remuneration from, or participates in, an
employee share scheme of the Company; and
ocontrol, or is an executive or other representative of an entity which controls,
5% or more of the Company’s voting securities.
Richard Milsom is not considered to be independent because he is Allied Farmers’ Managing Director and a
substantial shareholder.
SECTION 4. DIRECTORS
8

STATUTORY
DISCLOSURES
Statutory Disclosures:
M
ore information on Allied Farmers governance is set out in the Corporate Governance Report, a copy of
which is available on the Allied Farmers’ website, www.alliedfarmers.co.nz/investors.
Disclosure of Interest:
Pursuant to section 140 of the Companies Act 1993, the following changes in interests were disclosed during
FY23 (excluding directorships of wholly owned subsidiaries) in the Interests Register:
DirectorEntity Relationship
Shelley Ruha
9 Spokes and subsidiaries
Chair
Analey Holdings Ltd and
Analey Investments Ltd
Director and Shareholder
Heartland Bank Ltd Director
Hobson Wealth Holdings Ltd
and Hobson Wealth Partners
Ltd
Director
IT & Business Consulting Ltd Director and Shareholder
Partners Group Holdings Ltd and
Partners Life Ltd
Director
PaySauce
Chair
Tax Gift Chair
Richard Milsom Bellevue Enterprises Limited Executive Director
Ngutunui Dairies Limited Director
W2 Dairies Director
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Directors’ Share Trading and Holdings:
D
irectors and former directors disclosed the following acquisitions and disposals of relevant interests in Allied
Farmers Limited shares during FY23 pursuant to section 148 of the Companies Act 1993:
Director/relevant
Interest
Date(s) Details
Chris
Swasbrook/Elevation
Capital Management
Limited
12 May 2023
Off market transfer where Elevation Capital client (PT
Class 10 Nominees) sold 775,000 ordinary shares to
WAF Limited for total consideration of $581,250.
5 April 2023
Off market transfer where Elevation Capital sold
2,750,000 ordinary shares to entities/parties
associated with Richard Milsom for a total
consideration of $2,062,500.
1 December 2022
Off market transfer where two Elevation
Capital wholesale clients acquired 325,000 ordinary
shares for a total consideration of $237,250. Hopeton
Trustee Company Limited
was the seller.
5-9 September 2022 On market transfer where two Elevation
Capital wholesale clients acquired 120,000 ordinary
shares for a total consideration of $90,000.
Richard Milsom 5 April 2023
Off-market purchase of 2,616,682 Allied Farmers
Limited shares from Elevation Capital Management
Limited for a total consideration of $1,962,512.
25 November 2022 Off market purchase of 675,000 shares from Hopeton
Trustee Company Limited for a total consideration of
$506,250.
As at 30 June 2023, directors, or entities related to them, held relevant interests (as defined in the Financial
Markets Conduct Act 2013) in Allied Farmers Securities as follows:
D
irector
Number of shares and percentage of shares on
issue
Richard Milsom 4,553,667 (15.8%)
Philip Luscombe 15,557 (0.054%)
Shelley Ruha 150,000 (0.52%)
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SECTION 5. STATUTORY DISCLOSURES
Directors’ Fees:
Director 2023 2022
Philip Luscombe $55,000 $50,833
Shelley Ruha
1
$38,333
-
Richard Milsom
2

- -
Christopher
Swasbrook
3

$46,250 $46,667
Marise James
4

-
$23,676
Richard Perry
5

-
$15,000
Ross Verry
6
- $2,917
Mark Franklin
7
$29,167 $45,833
Total $168,750 $184,926
Directors Other Remuneration:
Director 2023 2022
Marise James
8

- $800
Richard Perry
9

- $28,072
Richard Milsom
$95,416
-
Shelley Ruha
$20,348
-
Total
$115,764 $28,872
1
Appointed 9 November 2022
2
Appointed 5 April 2023
3
Resigned 5 April 2023
4
Resigned 24 November 2021
5
Resigned 1 October 2021
6
Resigned 15 July 2021
7
Deceased November 2022
8
Marise James is a Partner in Baker Tilly Staples Rodway, which, provided tax and consulting services to the Allied Group
9
Waimatai Group Limited, a company associated with Richard Perry, provided services to the Allied Group.
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SECTION 5. STATUTORY DISCLOSURES


Shareholders approved a cap on directors’ fees of $332,000 p.a. at the 2007 Annual Meeting. This cap
includes all directors’ fees paid in relation to Group subsidiary companies as well as for the Parent. In
addition to the above payments, Oliver Carruthers, a director of NZ Farmers Livestock Limited received
total remuneration and benefits from NZ Farmers Livestock Limited of $ 207,922,
and Simon Williams, a
director of NZ Farmers Livestock Limited and NZ Farmers Livestock Finance Limited, received total
remuneration and benefits from NZ Farmers Livestock Limited of $122,973. In neither case did this
remuneration and benefits include any director’s fees.

Particular Disclosures:

NZ Rural Land Management Acquisition:

On 27 March 2023, Elevation Capital Management Limited (ECML), an Associated Person of former
Allied Farmers’s Director Chris Swasbrook (but who at that time was an Allied Farmers’s Director), sold
a 16.5 percent interest in NZ Rural Land Management GP Limited and NZ Rural Land Management
Limited Partnership to Allied Farmers for $2,739,000. The purchase price for this interest was satisfied
by cash consideration of $2,161,500 and the transfer from Allied Farmers to ECML of 594,075 ordinary
shares in NZ Rural Land Company Limited (NZL) for $0.9721 per share, being the 20-day volume
weighted price of NZL’s shares on the NZX.

On 27 March 2023, RPMilsom Investments Limited and REM Trustee Limited (RL), Associated Persons
of Director Richard Milsom ( but who was not a Director at the time), sold a 7.5 percent interest in NZ
Rural Land Management GP Limited and NZ Rural Land Management Limited Partnership to Allied
Farmers for $1,245,000. The purchase price for this interest was satisfied by cash consideration of
$982,500 and the transfer from Allied Farmers to RPM of 270,034 ordinary shares in NZ Rural Land
Company Limited (NZL) for $0.9721 per share, being the 20-day volume weighted price of NZL’s shares
on the NZX.

The cash consideration for the NZRLM acquisition was partly funded by a loan to Allied Farmers from
Heartland Bank Limited. Allied Director Shelley Ruha is also a director of Heartland Bank Limited.
Accordingly, Ms. Ruha took no part in negotiating the terms of the Heartland loan.

Additional Related Party disclosures and information can be found in section E1 of the FY23 Financial
Statements.

General:

Except to the extent described above, no Director has entered into any transactions with the Company
or its subsidiaries other than in the normal course of business, on the Company’s normal terms of trade,
and on an arms-length basis.

No Director issued a notice requesting to use Group information received in their capacity as a Director
which would not otherwise have been available to them.

During the year the Company paid premiums on contracts insuring directors and officers in respect of
liability and costs permitted to be insured against in accordance with Section 162 of the Companies Act
1993 and the Company’s constitution.

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SECTION 5. STATUTORY DISCLOSURES



Managing Director Remuneration:

The review and approval of the Managing Director’s remuneration is the responsibility of the Allied
Farmers’ Board.

The Managing Director’s remuneration comprises a fixed base salary, and at-risk short-term and long-
term incentives. These incentives have been agreed for the FY24 financial year, but given Mr. Milsom
only commenced his role in April 2023, the Board determined that it was not necessary or appropriate to
adopt incentives for the remainder of FY23. At-risk incentives are paid against targets agreed with the
Managing Director, and are based on financial measures including earnings targets and progress
against objectives related to the strategic plan and other personal objectives. The Board will assess the
Managing Director’s performance at the end of FY24 year and this will be disclosed in the FY24 Annual
Report. Richard Milsom’s total remuneration for FY23 was $95,416 *

* Note this is for the period 1 April to 30 June 2023. Prior to that Mr. Milsom was not Allied Farmers’
Managing Director, and therefore remuneration he received prior to 1 April 2023 for services provided to
NZRLM is not included.

Short Term Incentive
For FY24 the Managing Director’s short-term targets and objectives are structured as follows.

Target: $125,000
Maximum achievable: $250,000
Objectives:
• 50% - NZRLM achieves Budgeted NPAT.
• 10% - NZFL achieves Budgeted NPAT.
• 20% - NZ Rural Land Company Limited (NZRLC) relationship.
• 20% - Strategy and leadership.
Long Term Incentive
The Board established a Long-T erm Incentive Plan to link rewards with strategic long-term goals and
performance and the maximisation of shareholder returns. This involves a grant of Performance Rights
being made to the Managing Director subject to certain Vesting Conditions. Each Performance Right
represents a right to receive an Allied Farmers’ ordinary share or be paid an amount of cash
consideration (in certain circumstances), subject to the satisfaction of the Vesting Conditions. The
Vesting Conditions will be measured over a performance period starting from 1 July 2023 and ending
30 June 2026.
The proportion of Performance Rights that satisfy the Performance Vesting Condition will be determined
by reference to the following scale:

Performance against target (budgeted) three-
year average of Group NPAT
Percentage of performance rights to satisfy Performance
Vesting Condition
<80% of target 0%
80% to 100% of target 50% paid if achieve 80%.
100% paid if achieve 100% or more.

with a pro rata allocation between the 80% and 100%
achievement levels.
13

SECTION 5. STATUTORY DISCLOSURES




Subject to shareholder approval, 144,032 Performance Rights will be issued to Mr. Milsom for
FY24.The NPAT target will be set at the beginning of each of the three financial years. Performance will
be assessed each year relative to the targets. Because Mr. Milsom is a Director, the grant of
Performance Rights is subject to and conditional on approval from Allied’s shareholders. Allied intends
to seek this approval at its 2023 Annual Shareholders Meeting, likely to be in November 2023.


NZ Farmers Livestock CEO Remuneration:

The review and approval of the CEO’s remuneration is the responsibility of the Subsidiary Board.

The CEO’s remuneration comprises a fixed base salary, fringe benefits and an at-risk short-term
incentive payable annually. There is no long-term incentive. At-risk incentives are paid against targets
agreed with the CEO, and are based on financial measures including earnings targets and progress
against objectives related to the strategic plan and other personal objectives. The Board assesses the
CEO’s performance at the end of the financial year to determine the actual payment value of his short-
term incentive. For FY23 these targets and objectives were structured as follows.

Category Weight Measure
Target $60,000

Financial Performance



65%
• 50% paid if achieve 90% of NZFL Net Profit Before
Tax (NPBT) (after Redshaw minorities) board
approved budget.
• 100% paid if achieve 110% of NZFL NPBT (after
Redshaw minorities) Board approved budget with
a pro rata allocation between the 90% and 110%
achievement levels.

Non-financial
performance

35%
Health and safety and other non-financial measures
Stretch $70,000

Financial Performance



100%
• 50% paid if achieve 125% of NZFL NPBT (after
Redshaw minorities) Board
approved budget.
• 100% paid if achieve 150% of NZFL NPBT (after
Redshaw minorities) Board approved budget with
a pro rata allocation between the 125% and 150%
achievement levels.


The NZL Board assessed Steve Morrison’s achievement against these FY23 performance targets at
30% of Target Financial Performance, 54% of Target Non-financial Performance and 60% of Stretch
Financial Performance.




14

SECTION 5. STATUTORY DISCLOSURES




Steve Morrison’s total remuneration received during FY23 was as follows:


Financial Year Salary Benefits Performance – Short-term
Incentive
Total
Remuneration
FY 2023 $273,961 $18, 483 $47,250 being 79% of
maximum achievable from
FY22
$339,694
FY 2022 $265,081 $20,522 $40,200 being 67% of
maximum achievable from
FY21
$325,803

No executives or employees other than Mr. Milsom have a Long-Term Incentive Plan. Neither Mr. Milsom or
Mr. Morrison have a severance package. Mr. Morrison is subject to a one-month notice period under his
Employment Agreement, and either party may give three months’ notice to terminate Mr. Milsom’s Service
Level Agreement.

15

SECTION 5. STATUTORY DISCLOSURES



Subsidiary Employee Remuneration:

The number of employees whose remuneration and benefits were over $100,000 for FY23 is within the
specified bands as follows:


Remuneration Range 2023 2022
100,000 110,000 4 3
110,001 120,000 5 3
120,001 130,000 3 2
130,001 140,000 1 2
140,001 150,000 2 1
150,001 160,000 2 2
160,001 170,000 2
170,001 180,000
180,001 190,000 1 1
190,001 200,000 1
200,001 210,000 1 1
210,001 220,000 2
220,001 230,000 1 1
230,001 240,000 3 2
240,001 250,000 1
250,001 260,000
260,001 270,000 1
270,001 280,000
280,001 290,000
290,001 300,000
300,001 310,000
310,001 320,000 1
320,001 330,000 1
Total 28 22

The remuneration figures shown in the above table include all monetary remuneration actually paid, plus
the cost of all benefits provided, during the year. The table does not include independent contractors.

16

SECTION 5. STATUTORY DISCLOSURES


Substantial Product Holders:
Notices given under the Financial Markets Conduct Act 2013 up to the date of this Annual Report:

Holder Relevant Interest Date of Notice
Richard Milsom 4,553,6673 (15.8%) 5 April 2023
WAF Limited 4,104,892 (14.25%) 11 May 2023

Subsidiary Companies:

Directors of subsidiary companies as at 30 June 2023 were as follows:

Subsidiaries of the Parent Principal Activity Directors
Allied Farmers Rural Limited Rural Services S. Ruha, P Luscombe
ALF Nominees Limited
Nominee company S. Ruha
Allied Farmers (New Zealand)
Limited
Non-trading S. Ruha
Rural Funding SolutioNZ
Limited
Rural Financing S. Ruha, O Carruthers
Subsidiaries of Allied Farmers (New Zealand) Limited
Allied Farmers Property
Holdings Limited
Non-trading S. Ruha
QWF Holdings Limited Non-trading S. Ruha
Lifestyles of NZ Queenstown
Limited
Non-trading S. Ruha
LONZ 2008 Limited Non-trading S. Ruha
LONZ 2008 Holdings Limited Non-trading S. Ruha
Clearwater Hotel 2004 Limited Non-trading S. Ruha
Subsidiaries of Allied Farmers Property Holdings Limited
UFL Lakeview Limited Non-trading S. Ruha
5M No 2 Limited Non-trading S. Ruha
Subsidiaries of Allied Farmers Rural Limited

NZ Farmers Livestock Limited

Livestock Trading
P Luscombe, R. Milsom, S
Williams, O Carruthers
Subsidiaries of NZ Farmers Livestock Limited
Farmers Meat Export Limited Meat Processing S Morrison, W Sweeney, P
Luscombe
NZ Farmers Livestock
Finance Limited
Rural Finance S. Ruha, O Carruthers
Redshaw Livestock Limited
Livestock Trading
D Freeman, A Hiscox, M MacDonald,
W Sweeney
17

SECTION 5. STATUTORY DISCLOSURES


Shareholder Information:

The ordinary shares of Allied Farmers Limited are listed on the NZX. The NZX share code is ‘ALF’.

Twenty Largest Registered Shareholders:

The shareholder information in the following disclosures has been taken from the Company’s share
register at 8 August 2023.


Rank Investor Name
Total
Units
%
Issued
Capital
1 Rem Trustee Limited 3,385,000 11.75
2 Custodial Services Limited 3,118,375 10.83
3 Waf Limited 2,455,000 8.52
4 Wairahi Investments Limited 1,300,000 4.51
5 Donald Clifton Jacobs 831,050 2.88
6 FNZ Custodians Limited 704,253 2.44
7 Elizabeth Beatty Benjamin & Michael Murray Benjamin 682,622 2.37
8 Dfs Investment Partners Llc 522,185 1.81
9 Rpmilsom Investments Limited 512,000 1.78
10 Deborah Lee Seerup 500,001 1.74
11 New Zealand Depository Nominee 458,673 1.59
12 Glenn Leslie Ballinger 457,334 1.59
13 New Zealand Central Securities Depository Limited 424,880 1.47
14 FNZ Custodians Limited 400,374 1.39
15 Fortune Capital Group Limited 337,239 1.17
16 Jade NZ Limited 300,000 1.04
17 Colin Stuart Loveday 231,000 0.80
18 Ross Phillip Drew 221,404 0.77
19 Lee Athol Wilson & Shirley Ann Wilson 200,000 0.69
20 David Mitchell Odlin 196,619 0.68
18

SECTION 5. STATUTORY DISCLOSURES
Analysis of Shareholding:
Range Holders Holders % Issued Capital Issued Capital %
1-1000 1484 62.33 572,830 1.99
1001-5000 448 18.82 1,113,081 3.86
5001-10000 180 7.56 1,341,838 4.66
10001-50000 206 8.65 4,444,751 15.43
50001-100000 26 1.09 1,894,794 6.58
Greater than 100000 37 1.55 19,439,140 67.48
Diversity and Gender:
In June 2020, Allied Farmers adopted a Diversity and Inclusion Policy. More information on the Policy is set out
in the Corporate Governance Report and a copy is available on the Allied Farmers’ website. The Board has
evaluated Allied Farmers’s performance against its Diversity Policy objectives to operate the business in a way
that:
•does not tolerate discrimination of any kind;
•is objective, open-minded and free from discrimination;
•empowers management to cultivate a culture of inclusion in which the strengths of every
individual are recognised and valued;
•seeks to ensure that all staff receive equal and fair treatment under our policies and practices,
so that success is unhindered by individual differences;
•recognises and values individual diversity, different skills, ability and experiences; and,
•complies with the New Zealand Human Rights Act 1993, New Zealand Bill of Rights Act
1990, and all other relevant Human Rights laws.
The Board considers that these objectives have been met.
As at 30 June 2023, females represented 33% (FY22: 0%) of Directors and 17% (FY22: 25%) of Officers
of Allied Farmers. Officers are defined as being the Chief Executive Officer of NZ Farmers Livestock Limited
and specific direct reports of the CEO having key influence, and the Managing Director of Allied Farmers
Limited.
Current Year Previous Year
Male Female Male Female
Number of Directors 2 1 3 0
Percentage of
Directors
67% 33% 100
%
0%
Number of Officers 5 1 4 1
Percentage of
Officers
83% 17% 80% 20%
19

SECTION 5. STATUTORY DISCLOSURES


Shareholder Enquiries:

Shareholders should send changes of address, dividend queries, and instructions and shareholding information
requests to Link Market Services Limited, which acts as the Company’s share registrar.

Annual Meeting of Shareholders:

Allied Farmers Limited’s Annual Meeting of shareholders is typically held in late November each year. A Notice
of Annual Meeting and Proxy Form will be circulated to shareholders prior to the meeting.

Dividends Paid:

No dividend was paid to shareholders in FY23 (FY22: Nil).

Donations:

The Allied Farmers Board has determined that it will not make political donations. No political donations were
made during FY23.
20

CONSOLIDATED
FINANCIAL STATEMENTS
SEC

TION

6
21

Allied Farmers Group
Consolidated Profit and Loss Statement
For the year ended 30 June 2023
JuneJune
20232022
Note$000$000
Commission and fee incomeA1 15,906
15,057
Sale of goodsA1 10,015
9,292
Interest incomeA1 414
630
Other IncomeA1 387
215
Equity Accounted Earnings NZRLMA1
417
1,624
Total Income
27,139
26,818
Cost of goods soldA1 (7,155) (7,271)
Personnel expensesA1 (10,018) (10,146)
Depreciation and amortisationA1 (902) (892)
Operating expensesA1
(4,717) (4,661)
Total Expenses
(22,792) (22,970)
Finance CostsA1
(276) (292)
Profit before tax 4,071
3,556
Income tax (expense) / benefitA2 207 (24)
Profit after tax 4,278
3,532
Total comprehensive income
4,278
3,532
Profit attributable to:
Shareholders of Allied Farmers Limited ('Allied')
3,338
2,876
Minority shareholders of NZ Farmers Livestock Limited ('NZFL')
940
656
Allied Earnings per share (cents) - Basic and Diluted
11.59
9.98
Weighted average number of shares - Basic and Diluted (000's)
28,806
28,806
Consolidated Statement of other Comprehensive Income
For the year ended 30 June 2023
JuneJune
20232022
Note$000$000
Profit after tax 4,278
3,532
C2 (670) (53)
Total comprehensive income
3,608
3,479
Group
Group
Change in value of investment in equity securities
22

Allied Farmers Group
Consolidated Statement of Cash Flows
For the year ended 30 June 2023
JuneJune
2023
2022
Note$000$000
Cash flows from/(to) operating activities
Cash receipts from customers26,144 24,758
Interest received414 630
Distribution from NZRLM- 625
Cash paid to suppliers and employees(23,541) (22,185)
Interest paid(276) (292)
Income tax (paid)/received(52) (97)
Net cash flow from operating activities2,689 3,439
Cash flows from/(to) investing activities
Dividend income from NZRLC152 -
Decrease (Increase) in finance receivables NZ Farmers Livestock Finance Ltd/Rural Financial SolutioNZ Ltd1,324 2,326
Disposal (Acquisition) of New Zealand Rural Land Company Limited shares(156) (1,484)
Investment in New Zealand Rural Land Management Partnership C2(6,358)
-
Purchase of shares in NZ Farmers Livestock Ltd(93) (12)
Net disposal/(acquisition) of intangibles, property, plant and equipment(120) 124
Net cash flow from/(used in) investing activities(5,251) 954
Cash flows from/(to) financing activities
Drawdown of Heartland borrowings 3,660 -
Repayment livestock trading borrowings- (1,115)
Repayment of finance receivables borrowings- (925)
Repayment of bond- (1,000)
Dividends paid to Minority Shareholders in Subsidiaries (1,295) (535)
Lease principal repayments(567) (813)
Net cash flow used in financing activities1,798 (4,388)
Net movement in cash and cash equivalents(764) 5
Opening cash and cash equivalents4,547 4,542
Closing cash and cash equivalentsB43,783
4,547
Reconciliation of Profit to Cash Surplus from Operating Activities
Profit for the year 4,278
3,532
Adjustments for items not involving cash flows:
Impairment on receivables 10
41
(Profit)/loss on sale of assets 13 (31)
Depreciation and amortisation 902
892
(Increase) Decrease in Deferred Tax (330) (40)
Other - including non cash items (442) (979)
153 (117)
Movement in trade and other receivables 75
267
Movement in inventories
(178) (23)
Movement in trade, other payables and employee benefits
(1,493)
(188)
Movement in taxation (146) (32)
Cash flow from operating Activities 2,689
3,440
Group
23

Allied Farmers Group
Consolidated Balance Sheet
As at 30 June 2023
JuneJune
20232022
Note$000$000
Equity
Share capitalB2 158,204
158,204
Accumulated Losses (141,134) (143,743)
Equity attributable to owners of the Parent 17,070
14,462
Non-controlling interestsB3 1,653
2,042
Total equity 18,723
16,504
Liabilities
Trade and other payablesB7 9,498
10,849
Employee benefits 1,365
1,515
Income tax payable 79
7
Bank borrowingsB5 945
-
Lease liabilitiesB6 665
761
Total current liabilities 12,552
13,132
Bank borrowingsB5 2,715
-
Lease LiabilitiesB6 905
1,377
Total non-current liabilities 3,620
1,377
Total liabilities 16,172
14,509
Total liabilities and equity 34,895
31,012
Assets
Cash and cash equivalentsB4 3,783
4,547
Trade ReceivablesC1 9,931
9,830
Inventories 252
74
Finance receivablesC1 1,505
2,830
Other receivables 214
292
Total current assets 15,685
17,573
Deferred tax assetsA2 1,324
993
GoodwillD2 742
742
Intangible assets C4 10,442
115
Investment - New Zealand Rural Land Management GP
Limited
C2 -
3,665
Investment - New Zealand Rural Land CompanyC2 2,467
3,103
Investments - OtherC2 6
2
Property - owned C3 2,837
2,932
Property - right of use assetsC3 1,392
1,887
Total non-current assets 19,210
13,440
Total assets 34,895
31,012
0.260.54
0.210.48
Note: net tangible assets is calculated as equity from which is deducted goodwill and intangible assets
Group
Net Tangible Assets per Share - attributable to Allied ($ per share)
Net Tangible Assets per Share - Consolidated ($ per share)
24

Allied Farmers Group
Consolidated Statement of Changes in Equity
Components that make up the capital and reserves of the Group and the changes of each component during the year.
For the year ended 30 June 2023
Group
Share
Capital
Accumulated
losses
Revaluation
Reserve
Allied
Shareholders
Interests
Minority
Shareholders
Interests
Total
$000$000$000$000$000$000
Balance at 1 July 2021 158,204 (146,431) (135) 11,638 1,933
13,571
Profit after tax for the year - 2,876 - 2,876 656
3,532
Revaluation of Equity Securities (refer Note C2) - - (53) (53) - (53)
Total comprehensive income for the period - 2,876 (53) 2,823 656
3,479
Dividends paid to Minority Interests - - - - (535) (535)
AFL purchase Minority Shareholders Shares - - - - (12) (12)
Total transactions with owners - - - - (547) (547)
Balance at 30 June 2022 158,204 (143,555) (188) 14,461 2,042
16,503
Balance at 1 July 2022 158,204 (143,555) (188) 14,461 2,042
16,503
Profit after tax for the year - 3,338 - 3,338 940
4,278
Revaluation of Equity Securities (refer Note C2) - - (670) (670) - (670)
Total comprehensive income for the period - 3,338 (670) 2,668 940
3,608
Dividends paid to Minority Interests - - - - (1,295) (1,295)
AFL purchase Minority Shareholders Shares - (59) - (59) (34) (93)
Total transactions with owners - (59) - (59) (1,329) (1,388)
Balance at 30 June 2023 158,204 (140,276) (858) 17,070 1,653
18,723
25

Allied Farmers Group
A Financial performance
A1 How we operate and generate returns for shareholders
Livestock services: An agency business facilitating livestock transactions and the procurement and export of veal.Financial services: Providing and referring livestock finance to farmer clients.Parent operations: The ultimate holding company for Allied Group's investments and governance activity for the Group.Segment information (Audited)
June
June
June
June
June
June
June
June
June
June
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
$000
$000
$000
$000
$000
$000
$000
$000
$000
$000
Commission and fee income
14,699
15,057
4
-
1,203
-
-
-
15,906
15,057
Sale of goods
10,015
9,292
-
-
-
-
-
-
10,015
9,292
Interest income
284
216
124
414
-
-
6
-
414
630
Other Income *
40
158
195
15
-
-
152
42
387
215
Equity Accounted Earnings NZRLM
-
-
-
-
417
1,624
-
-
417
1,624
Total Income
25,038
24,723
323
429
1,620
1,624
158
42
27,139
26,818
Cost of goods sold
7,155
7,271
-
-
-
-
-
-
7,155
7,271
Personnel expenses
9,789
10,024
96
46
56
-
77
76
10,018
10,146
Depreciation and amortisation
769
892
-
-
133
-
-
-
902
892
Operating expenses
3,606
3,937
41
77
210
-
860
647
4,717
4,661
Total Expenses
21,319
22,124
137
123
399
-
937
723
22,792
22,970
Finance Costs
(128)
(140)
(64)
(134)
(84)
-
-
(18)
(276)
(292)
Profit/(loss) before tax
3,591
2,459
122
172
1,137
1,624
(779)
(699)
4,071
3,556
Income tax (expense) / benefit
207
(24)
Profit/(loss) after tax
4,278
3,531
Current Assets
12,603
14,300
1,505
2,830
1,267
-
310
443
15,685
17,573
Investments in NZRLC
-
-
-
-
-
-
2,467
3,103
2,467
3,103
Investment in Associates and Joint Ventures
-
-
-
-
-
3,665
-
-
-
3,665
Other Non-Current Assets
6,296
6,571
100
100
10,347
-
-
-
16,743
6,671
Assets
18,899
20,871
1,605
2,930
11,614
3,665
2,777
3,546
34,895
31,012
Current Liabilities
10,869
13,029
525
-
1,001
-
158
103
12,552
13,132
Non-Current Liabilities
905
1,377
-
-
2,715
-
-
-
3,620
1,377
Liabilities
11,773
14,406
525
-
3,716
-
158
103
16,172
14,509
Additions of Property, Plant and Equipment, and Right of Use assets
231
771
-
-
-
-
-
-
231
771
* Other Income included in 2022 - Covid 19 Wage and Resurgence Subsidy payments $117,686.* Other Income in the Financial Services segment includes referral fee income from Heartland Bank Limited to 30 June 2023 $195,214 (2022: $15,084)
In this section
Rural Land Management: Investment in New Zealand Rural Land Management Limited Partnership the contracted asset manager of New Zealand Rural Land Company Limited.
Livestock Services
Financial Services
Rural Land Management
Total
Parent Operations
26

A2Taxation
2023
2022
$000 $000
Income tax using the company's tax rate (28%)1,140 996
Expenditure not deductible for tax
3
3
Other permanent differences
(80)
202
Temporary differences
1
57
Recognition of deferred tax asset
(330)
(40)
Use of Group tax losses
(527)
(1,194)
Income tax expense (benefit)207
24
Deferred Tax
Movement in temporary differences during the year
Opening
balance
Recognised in
income
Closing
Balance
$000$000$000
Financial receivable credit loss provision 48 3 51
Employee benefits 251 (2) 249
Tax loss carry forward 694 330 1,024
993 331 1,324
Financial receivable credit loss provision 36 12 48
Employee benefits 205 46 251
Tax loss carry forward 712 (18) 694
953 40 993
Revenue by NZRLM from property management fees, performance fees and transaction fees are recognised as revenue in the accounting periods in which
the services are rendered, which is when they satisfy their performance obligations to NZRLC.
Measurement and Recognition
Commission income on facilitating a livestock sale agreement, grazing agreement or forward livestock sale agreement is recognised when the sale is agreed
by a vendor and purchaser, net of rebates. The Group is acting as an agent as it doesn't have inventory risk and isn't able to set a price.
Forward delivery contracts in relation to herd sales on which commission income is earned contain an element of variable consideration due to the timeframe
between when the sale is agreed and its completion. At year end the variable consideration is taken account of in the revenue recognised.
Sale of goods (veal meat and skins) revenue is recognised once goods are delivered to the customer. The Group is deemed a principal, rather than an
agent, as it holds inventory risk.
Fee income relates to RFID scanning fees, yard fees charged at saleyards and valuation fees. The income is recognised when livestock are scanned, a sale
is agreed within the auction or when the livestock are weighed. The Group is acting as a principal as it is primarily responsible for the service rendered and is
able to set a price.
2022
Finance receivables interest income is recognised using the effective interest method. The calculation of the effective interest rate includes all fees that are
integral to the effective interest rate. All fees except those charged to customer accounts in arrears are considered to be integral to the effective interest
rate.
Fees charged to customer accounts in arrears are recognised as income at the time the fees are charged.
Income from referring customers to Heartland Bank Limited is recognised when the financing transaction is agreed between Heartland Bank Limited and the
borrower, and Heartland Bank Limited earns income from interest and fees from the customer. Because the Group is acting as a referrer to Heartland Bank
Limited, it doesn't have credit risk and isn't able to set an interest rate.
The shares in New Zealand Rural Land Company Limited are equity investments quoted in an active market which the Group has elected to designate as a
financial asset at fair value through Other Comprehensive Income. The fair value of these shares at 30 June 2023 is $2,467,184 (2022: $3,103,000). The
Company also owned 50% of NZ Rural Land Management Partnership ('NZRLM') until March 2023. NZRLM is the external manager of New Zealand Rural
Land Company Limited. The remaining 50% the Company did not previously own was acquired in March 2023. Accordingly, from that point, NZRLM has
been fully consolidated in the Group's financial statements.
2023
Group
Measurement & Recognition
Income tax expense is the income tax assessed on taxable profit for the year. Taxable profit differs from profit before tax reported in the statement of
comprehensive income as it excludes items of income and expense that are taxable or deductible in future years (i.e. deferred tax) and also excludes items
that will never be taxable or deductible.
The Performance fees are settled in NZRLC shares with half of the shares issued subject to escrow arrangements for 5 years after the performance fee is
payable.
27

The Group announced on 28 November 2022 that it had obtained a Private Ruling from Inland Revenue under s91E of the Tax Administration Act 1994 that
resulted in a significant increase in Tax Losses available to the Allied Farmers Group. Group unrecognised deferred tax assets comprise unused tax losses
as at 30 June 2023 which are estimated at $180,785,199 (2022: $36,288,403). The ability to utilise tax losses, which given the age of the losses, is
dependent upon continuing to meet shareholder continuity requirements of prevailing income tax legislation.
As at balance date imputation credits available to the shareholders of only the Parent Company in subsequent periods totalled $89,248 (2022: $89,248).
Key Judgement:
A deferred tax asset is recognised to the extent it is probable that future taxable profits will be available to use the asset. This is reviewed at each balance
date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available in the future to utilise the asset. The level of losses
recognised reflects management's expectations of recurring levels of taxable profitability for approximately the next 18 months.
Measurement and Recognition:
Deferred tax is income tax that is expected to be payable or recoverable in the future as a result of the unwinding of temporary differences. These arise from
differences in the recognition of assets and liabilities for financial reporting and for the filing of income tax returns. Deferred tax is recognised on all temporary
differences, other than those arising from goodwill and the initial recognition of assets and liabilities in a transaction (other than in a business combination)
that affects neither the accounting nor taxable profit or loss.
Deferred tax is calculated at the tax rates that are expected to apply to the year when a liability is settled or an asset realised, based on tax rates and tax laws
that have been enacted or substantively enacted at balance date.
28

Allied Farmers Group
B. Funding and Related Financial Risks
B1Capital management
B2Share Capital
20232022
Share capital ($000) 158,204 158,204
Number of shares issued and fully paid (000's)
Balance at beginning of period
28,807 28,807
Balance at end of year
28,807 28,807
B3Non-controlling interests
20232022
Summary financial results $000 $000
Revenue 25,361 25,071
Profit and total comprehensive income 3,713 2,549
Summarised balance sheet
Current assets 14,108 16,894
Non-current assets 6,396 6,631
Current liabilities (11,393) (13,029)
Non-current liabilities (905) (1,377)
Net assets 8,207 9,119
B4Cash and cash equivalents
20232022
$000 $000
Cash and cash equivalents 4,308 5,547
Finance Receivables overdraft facility offset per agreement (525) (1,000)
Net cash and cash equivalents 3,783 4,547
Undrawn overdraft facilities
7,975 9,500
Cash is held at banks with a credit rating of A- or higher.
B5Debt funding
Payable within 1
year
Payable after 1
year
UndrawnInterest rate
$000$000$000%
Bank borrowings - Heartland Bank Limited
945 2,715 150 9.67
Total debt funding
945 2,715 150
Bank borrowings
- - - -
Total debt funding
- - -
Group
Group
The borrowing facilities are secured, by way of a first ranking General Security Agreement and gross guarantee and indemnity, against the assets of NZ Farmers
Livestock Limited, NZ Farmers Livestock Finance Limited and Farmers Meat Export Limited. The financial covenants under these facilities have been fully complied
with during the year.
NZ Farmers Livestock Limited guarantees the bank overdraft of its subsidiary Redshaw Livestock up to $338,000 (FY22: $338,000), plus interest and costs.
In this section
This section explains how the Allied Group manages its various funding sources including capital structure and debt. It also explains the financial risks that the Group faces
and how these risks are managed.
Group
The Allied Farmer Group's non controlling interests arise from minority interests held by other shareholders in NZ Farmers Livestock Limited and further non-
controlling interests held by a shareholder other than NZ Farmers Livestock Limited in its controlled subsidiary, Redshaw Livestock Limited.
The following summary financial information of the NZFL Group is provided to assist in understanding the significance of external shareholders interests in the
group's reported position and performance. This information is presented before intercompany eliminations.
All ordinary shares rank equally as to voting, dividends and distribution of capital on liquidation.
The Allied Group's capital includes share capital, accumulated losses and non controlling interests.
The Board manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying
assets. In order to maintain or adjust the capital structure, the Group may issue new shares, sell assets, seek additional debt funding, or adjust the amount of
dividends paid to shareholders.
NZFL and Subsidiaries
2023
2022
29

Allied Farmers Group
B6Lease liabilities
PropertyMotor Vehicles
Plant &
EquipmentTotal
$000$000$000$000
Opening 353 1,729 57
2,139
Leases entered into during the period - 144 -
144
Interest expense 26 97 4
127
Principal repayments (120) (703) (17) (840)
259 1,267 44
1,570
Current lease liabilities
97 556 13
665
Non-current lease liabilities
162 711 31
905
Property
Motor Vehicles
Plant &
EquipmentTotal
$000$000$000
$000
Opening 456 1,677 -
2,133
Leases entered into during the period - 616 57
673
Interest expense 29 117 -
146
Principal repayments (131) (681) - (812)
353 1,729 57
2,139
Current lease liabilities
94 655 13
761
Non-current lease liabilities
259 1,074 44
1,377
B7
Balance Sheet
Contractual
Cashflow
< 6 months6 - 12 mths1 - 5 yrs
$000$000$000$000$000
Trade and other payables 9,498 9,498 9,498 -
-
Bank borrowings - Heartland Bank Limited 3,660 4,496 655 591
3,250
Lease liabilities 1,570 1,713 333 333
1,047
14,728 15,707 10,486 924
4,297
Trade and other payables 10,849 10,849 10,849 -
-
Lease liabilities 2,139 2,236 381 381
1,475
12,988 13,085 11,229 381
1,475
Measurement and recognition
Borrowings are initially measured at fair value, net of transaction costs. They are subsequently measured at amortised cost (using the effective interest method).
Fees for establishing new borrowings are spread over the term of those borrowings.
Liquidity risk
Liquidity risk represents the Group’s ability to meet its contractual obligations as they fall due.
Liquidity risk is reviewed on an ongoing basis and managed to meet requirements. Cash flow forecasting is performed in the operating entities of the Group and
aggregated at Group level. The Group monitors rolling forecasts of the Group's liquidity requirements to ensure it has sufficient cash to meet operational needs while
maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group does not breach borrowing limits or covenants (where
applicable) on any of its borrowing facilities.
The amounts disclosed in the tables below show the contractual undiscounted cash flows (including interest) due on financial liabilities, so will not always reconcile to
the amount disclosed on the statement of financial position. The amounts below also reflect the contractual repricing timing on financial liabilities, if applicable.
Measurement and recognition
The above lease liabilities are in relation to leases of regional offices and the leases of Motor Vehicles.
Residual buy back values included in new lease arrangements are included within lease payments in which management expects to exercise at the inception of the
lease.

The Group recognises a lease liability at the lease commencement date. The lease liability is initially measured at the present value of the lease payments that are
not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group’s incremental
borrowing rate. The Group's incremental borrowing rate ranges between 6.0% to 9.95% (2022 6.0% to 9.95%) as the discount rate, with adjustments for the type
and term of the lease.

The Group has elected not to recognise right-of-use assets and lease liabilities for short-term leases that have lease terms of 12 months or less and leases of low-
value assets. The Group recognises the lease payments associated with these leases within operating expenses on a straight-line basis over their lease terms.
2023
Group
Group
2022
The Heartland Bank Limited ('Heartland') borrowings are secured by way of a first ranking General Security Agreement and cross guarantee
against the assets of Allied Farmers Limited and New Zealand Rural Land Management Partnership.
The term of Heartland Bank Limited borrowings is 60 months from March 2023 with a principal instalment being due in September 2023 and a
further principal instalment due in March 2024. From this date the principal is repaid monthly until final repayment in March 2028. The interest rate
is calculated on the 90-day BKBM rate plus a margin of 4%.
2022
2023
30

Allied Farmers Group
Interest Rate Risk
20232022
$000 $000
Decrease/(Increase) in net profit based on a 1%
increase/(decrease) in rate
37 -
B8Net Interest income/(costs)
20232022
$000 $000
Interest received 414 630
Total interest income 414 630
Interest paid on borrowings (149) (128)
Interest paid on bonds - (18)
Lease interest (127) (146)
Total interest expenses (276) (292)
Net Interest income/(costs) 138 338
Group
Group
The Group is exposed to interest rate risk on movements in floating interest rates on bank borrowings. Finance receivables have fixed interest rates and generally
a term of less than one year.
In managing interest rate risk, the group aims to reduce the impact of short-term fluctuations on the group’s earnings. Over the longer term, however, permanent
changes in interest rates will have an impact on profit.
If market interest rates for bank borrowings were to increase or decrease by at least +/-1% (2022: +/-1%), the effect on net profit after tax and equity for the year as
applied to year end balances would be as follows:
31

Allied Farmers Group
C. Our receivables, other assets and other payables
In this section
C1Receivables
2023
2022
$000
$000
Trade Receivables (livestock and NZRLC receivables) 9,931 9,830
Finance receivables 1,506 2,830
Total receivables 11,437 12,659
Amounts are stated at carrying value, net of credit loss allowance
provisions of
181
172
Receivables written off during the year 10 32
The status of receivables at the reporting date is as follows:
Group receivables
Not yet due
1 - 30 days
overdue
31 - 60 days
overdue
61 - 90 days
overdue
Total
$000
$000 $000$000$000
Receivables from livestock sales
8,081 533 118 247
8,978
Credit loss allowance (livestock)
(27) (10) (3) (51) (91)
Receivables from NZRLC
102 48 894 -
1,044
Finance receivables
1,514 2 2 78
1,596
Credit loss allowance (finance)
(8) (2) (2) (78) (90)
Net receivable
9,662 571 1,009 195
11,437
Receivables from livestock sales
8,315 756 507 335
9,912
Credit loss allowance (livestock)
(24) (9) (3) (46) (82)
Finance receivables
2,920 - - -
2,920
Credit loss allowance (finance)
(91) - - - (91)
Net receivable
11,121 747 504 289
12,659
Security held for finance receivables
2023
2022
$000
$000
1,535
2,382
61
538
Total finance receivables 1,596 2,920
Concentrations of counterparties
Movement in gross finance receivables balance
2023
2022
$000
$000
Opening balance
2,920
5,219
7,695
10,140
Principal repaid
(9,193)
(12,871)
174
432
Total finance receivables 1,596 2,920
This section explains:
- The assets the Group is due to receive from third parties and the credit risk associated with these assets.
- The property and motor vehicles the Group owns and has a right to use under lease arrangements.
- The obligations to third parties, other than banks and bond holders.
2022
2023
Group
On origination, the finance receivables will fund the entire value of secured livestock. No credit scores are assigned to borrowers for internal risk management
purposes.
Finance receivables are exclusively held with counterparties trading in the farming sector. However there are no individual counterparties that are considered
to be significant to the group.
Secured via PPSR
Not secured
All amounts not secured as at 30 June 2023 were subsequently secured.
The amount due from NZRLC includes transaction, leasing and management fees due within 10 business days after the last day of the month in which the
fees have arisen. This balance is not secured as at 30 June 2023. Of this amount, $700,000 has since been received.
New loans issued
Interest and fees accrued
Key Judgement
The loss allowances for receivables are based on assumptions about risk of default and expected loss rates. The Group uses judgement in making these
assumptions and selecting the inputs to the impairment calculation, based on the Group's past history and existing market conditions, as well as forward-
looking estimates at the end of each reporting period.
It is expected that all trade receivables will be collected within 12 months of the balance date. All accounts past their due date have been subject to individual
assessment.
32

Allied Farmers Group
Credit Risk Management
C2Investments Held by Group
2023
2022
$000
$000
2,467 3,103
- 3,665
6 2
Total Investments 2,473 6,770
New Zealand Rural Land Company Limited
2023
2022
$000
$000
Carrying Value Brought Forward
3,103
990
Shares Purchased / Issued / Rights Issue
156
1,484
Dividend Received as Shares
-
42
Shares Issued under NZRLM Performance Fee Arrangement
1,627
640
Shares sold
(1,750)
-
Change in Value Credited to Other Reserves
(669)
(53)
At 30 June 2,467 3,103
New Zealand Rural Land Management Limited
New Zealand Rural Land Management Partnership
Other Investments
New Zealand Rural Land Company Limited
Credit risk is the risk that a counterparty to a transaction with the Group will fail to discharge its obligations and make payment, causing the Group to incur a
financial loss.
The Group manages its exposure using a credit policy that includes limits on exposures with significant counterparties that have been set and approved by the
Board and are monitored on a regular basis and does not have any significant concentration of risk with any single party. The Group considers an account to
be in default when a debtor fails to make a contractual payment in the absence of a written agreement to the contrary. This is when the account is past due by
more than 90 days. Livestock finance receivables are secured over the livestock concerned and in the majority of cases supported by personal covenants
from the borrower.

Receivables are written off when there is no reasonable expectation of recovery, such as a debtor failing to engage in a repayment plan with the Group. The
Group categorises a loan or receivable for write-off when a debtor fails to make contractual payments more than 180 days past due. Where loans or
receivables have been written off, the company continues to engage in enforcement activity to attempt to recover the receivable due. Where recoveries are
made these are recognised in profit or loss.
Measurement and recognition
Receivables from livestock sales and Finance Receivables are measured on initial recognition at fair value, and are subsequently carried at amortised cost,
less provision for expected credit losses.
For Receivables from livestock sales, the provision for expected credit losses is based on the simplified approach, as permitted by NZ IFRS 9, and records the
loss allowances as lifetime expected credit losses from recognition. These are the expected credit losses that result from all possible default events over the
life of the financial instrument.
Finance Receivables are reviewed on an individual basis to determine whether any amounts are unrecoverable and an expected credit loss provision is
recorded. The expected credit losses are based on management's assessment of amounts considered uncollectible for specific customers based on age of
debt, history of payments, account activity, current and future economic factors and other relevant information. Debts known to be uncollectible are written-off
as bad debts to the profit and loss when identified.
At 30 June 2023 the Group holds 2,803,617 (2022 2,900,000) shares in New Zealand Rural Land Company Limited. This holding represents a 2% ownership
in NZRLC as at 30 June 2023 (2022: 2.56%). These shares are equity investments quoted in the active market which the Group has elected to designate as
a financial asset at fair value through other comprehensive income.
On 27th March 2023 Allied completed the purchase of the 50 percent of NZRLM that it did not already own. The consideration comprised a combination of
cash and NZRLC shares owned by Allied but transferred to NZRLM vendors.
From 27th March 2023 NZRLM is consolidated into the Allied Group consolidated Financial Statement (Refer note C4).
Under the Management Agreement NZRLC is to pay NZRLM a performance fee which, subject to certain adjustments, is to be equal to 10% of the increase in
net asset value of NZRLC in each financial year. The performance fee paid by NZRLC to NZRLM for the year ended 30 June 2022 comprised 2,499,247
shares in NZRLC. Fifty percent of these shares were then distributed by NZRLM to Allied Farmers Limited in proportion to Allied's ownership of NZRLM. The
performance fee for the year ended 30 June 2023 comprised 299,855 shares of NZRLC distributed to NZRLM. Half of the shares issued in each Financial
Year to satisfy the performance fee are subject to escrow arrangements, under which the Manager or any nominee agrees not to sell, transfer, assign or
otherwise dispose of, or offer or agree to sell, transfer, assign or otherwise dispose of, its right and title to, and beneficial interest in such shares for a five year
period. 1,065,650 shares distributed to Allied Farmers Limited were subject to this arrangement as at 30 June 2023 (2022: 290,791).
The fair value of NZRLC shares held by Allied Farmers Limited as at 30 June 2023 is $2,467,183 (2022: $3,103,000).
Settlement of receivables from NZRLC is dependent on NZRLC's cash flows and management expects that the full outstanding amount will be settled by the
end of September 2023.
33

Allied Farmers Group
Summarised Balance Sheet2023
2022
$000
$000
Current Assets
-
2,514
Current Liabilities
-
(190)
Net Assets - 2,324
Summarised Statement of Profit or Loss2023
2022
$000
$000
Income
-
4,147
Expenses
-
(898)
Profit - 3,249
Reconciliation of Summarised Financial Information2023
2022
$000
$000
Opening Balance 2,324
1,604
Profit For Period
920
3,249
Dividend
(2,677)
(2,529)
Less Transfer to Intangible Asset
(567)
-
Closing Net Assets - 2,324
Increase in net assets - 360
Reconciliation of Interest in Associate 2023
2022
$000
$000
Opening Balance 3,665
3,302
Increase in Net Assets (50% of Profit for Period)
417
1,624
Less Dividend paid (50% of Dividend)
(1,338)
(1,261)
Less Transfer to Intangible Asset
(2,744)
-
Carrying Value 30 June 2023 - 3,665
C3
Property, Plant & Equipment
Owned
LandBuildings
Plant and
equipment
Motor VehiclesTotal
$000 $000 $000 $000 $000
Cost at beginning of year
2,019 1,049 637 243
3,948
Additions
- - 22 -
22
Disposals
- - (9) (34) (43)
Cost at end of year
2,019 1,049 650 209
3,927
Accumulated depreciation at beginning of the year
- (546) (430) (38) (1,014)
Depreciation
- (61) (33) (14) (108)
Disposals
- - (2) 34
32
Accumulated depreciation at end of year
- (607) (465) (18) (1,090)
Net value 2023
2,019 442 185 191
2,837
LandBuildings
Plant and
equipment
Motor VehiclesTotal
$000 $000 $000 $000 $000
Cost at beginning of year
2,019 1,049 574 247
3,889
Additions
- - 70 30
100
Disposals
- - (7) (35) (42)
Cost at end of year
2,019 1,049 637 243
3,947
Accumulated depreciation at beginning of the year
- (484) (373) (35) (892)
Depreciation
- (62) (62) (4) (128)
Disposals
- - 6 -
6
Accumulated depreciation at end of year
- (546) (430) (38) (1,014)
Net value 2022
2,019 503 208 205
2,933
2022
Group
2023
The Directors obtained independent valuations for land and buildings dated December 2021 on a fair value basis. The valuation of these property assets
totalled $6.632 million, which significantly exceeded the historical costs of these assets reported above.
34

Allied Farmers Group
Right of Use Assets
PropertyMotor Vehicles
Plant &
Equipment
Total
$000 $000 $000 $000
Opening
338 1,493 57
1,888
Additions
- 140 -
140
Less Disposals
- (59) - (59)
Less Depreciation
(91) (473) (13) (577)
Total Right of use Asset 247 1,101 44
1,392
Total Cost
620 2,423 57
3,100
Total Accumulated Depreciation
(373) (1,322) (13) (1,708)
Total Carrying Value
247 1,101 44
1,392
PropertyMotor Vehicles
Plant &
Equipment
Total
$000$000$000$000
Opening 430 1,549 -
1,979
Additions - 614 57
671
Less Disposals - (196) - (196)
Less Depreciation (92) (474) - (566)
Total Right of use Asset 338 1,493 57
1,887
Total Cost
620 2,343 57
3,019
Total Accumulated Depreciation
(282) (850) - (1,132)
Total Carrying Value
338 1,493 57
1,887
C4
Intangible Assets
NZRLC
Management
Contract
Software Total
$000 $000 $000
Cost at beginning of year
- 739 739
Additions
10,474 70 10,544
Disposals
- - -
Cost at end of year
10,474 809 11,283
Accumulated amortisation at beginning of the year
- (624) (624)
Amortisation
(131) (86) (217)
Disposals
- - -
Accumulated amortisation at end of year
(131) (710) (841)
Net value 2023
10,343 99 10,442
NZRLC
Management
Contract
Software Total
Cost at beginning of year
- 566 566
Additions
- 173 173
Disposals
- - -
Cost at end of year
- 739 739
Accumulated amortisation at beginning of the year
-
(422) (422)
Amortisation
-
(202) (202)
Disposals - - -
Accumulated amortisation at end of year - (624) (624)
Net value 2022
- 115 115
Group
2023
2022
Measurement and recognition
Land is not depreciated. All other owned property, plant and equipment is depreciated on a straight line basis at rates over their estimated useful lives, as
follows:
- Buildings: 8 - 30 years.
- Plant and equipment: 1 - 30 years.
- Motor Vehicles (owned): 1-3 years
- Motor Vehicles (leased): over their lease term
2022
2023
35

Allied Farmers Group
Allied purchased a 50 percent interest in NZ Rural Land Management Partnership (NZRLM) on the 18th of December 2020.
In November 2020 New Zealand Rural Land Company Limited (NZRLC) entered into an exclusive management agreement with NZRLM to provide NZRLC
with management investment and administrative services (Management Agreement).
NZRLM provides all management services to NZRLC and receives management fees, transaction fees and performance fees.
For the years 2021 and 2022 the investment in NZRLM was accounted for using the equity accounting process.
On 19 December 2022 Allied Farmers Limited announced that it exercised its call option to purchase the remaining 50 percent of NZRLM that it did not already
own. On 27th March 2023 Allied completed the purchase of the 50 percent of NZRLM that it did not already own.
The NZRLM consideration was based on an independent valuation further supported by an independent expert’s report and totalled $8.3m (the total value
being $16.6M).
Allied has decided to apply the Optional concentration test under NZ IFRS 3 to consider if the acquisition can simply be considered an asset purchase.
Allied determined that the optional concentration test is met because substantially all of the value of the gross assets is concentrated in a single identifiable
asset being the management contract with NZRLC. Accordingly, the transaction is treated as an asset purchase.
The Management Contract meets the definition of an intangible asset.
Accordingly Allied has elected to follow a cost-based approach for the acquisition of this intangible asset.
Acquisition-related costs of $119,131 are included in other expenses in profit or loss in the reporting period ending 30 June 2023.
The amounts of revenue and profit of NZRLM since the acquisition date are included in the consolidated statement of comprehensive income for the reporting
period totaled $1.137m (this includes equity earnings of $0.417m which arose prior to acquisition of the remaining 50% shareholding).
Measurement and recognition
Intangible assets are depreciated on a straight line basis at rates over their estimated useful lives, as follows:
- Management Contract - 20 years
- Software - 3 years

36

Allied Farmers Group
D. Group Structure
In this section
D1Subsidiaries and Associates
2023
2022
Ownership
interest
Ownership
interest
Operating Subsidiaries of the Parent
Allied Farmers (New Zealand) Limited
Investment
100%100%
Allied Farmers Rural Limited
Investment
100%100%
Rural Funding SolutioNZ Limited
Finance
100%100%
New Zealand Rural Land Management Partnership
Rural Property Management
100%50% *
Subsidiaries of Allied Farmers Rural Limited
NZ Farmers Livestock Limited
Livestock Agency and Finance68%
67%
Subsidiaries of NZ Farmers Livestock Limited
Farmers Meat Export Limited
Meat Processing and Trading100%
100%
NZ Farmers Livestock Finance Ltd
Livestock Finance100%
100%
Redshaw Livestock Limited
Livestock Agency52%
52%
* associate of the parent 2022
D2 Goodwill
2023
2022
Cash generating units:
$000
$000
Redshaw
642
642
NZFLFL
100
100
742
742
Impairment assessment
Redshaw CGU
2023
2022
Revenue growth rate
2.0%
2.0%
Long term growth rate
2.5%
2.0%
15.5%
15.5%
The Group financial statements include the financial statements of Allied Farmers Limited and the operating subsidiaries listed below.
Subsidiaries are entities controlled by the group. Control exists when the Group has the power to govern the financial and operating policies of the entity so
as to obtain benefit from its activities. The financial records of operating subsidiaries are included in the consolidated financial statements from the date on
which control commences until the date on which control ceases.
There are a number of subsidiaries within the Group that are non-trading and therefore have no financial records during the year or balances as at year-
end, they are not included within these consolidated financial statements.
This section provides information to help readers understand the Group structure and how it affects the financial position and performance of the Group.
All companies within the Group are incorporated in and have their principal place of business in New Zealand, and have a balance date of 30 June.
On an annual basis, the recoverable amount of Goodwill is determined based on value in use calculations specific to the Redshaw CGU. These
calculations use pre-tax cash flow projections based on financial budgets prepared by management covering a five year period. Cash flows beyond
the five year period are extrapolated by way of a terminal value calculation using the estimated growth rates stated below. The growth rates adopted
are consistent with internal forecasts and budgets. The discount rate reflects the specific risks relating to the cash flow being discounted.
Below is a sensitivity analysis showing the impact on value of changes to the key variables:
The estimated recoverable amount of the Redshaw CGU is estimated to have exceeded the carrying amount of the CGU at 30 June 2023 by
approximately $152,000 (2022: $151,000).
Goodwill in Redshaw arose on the acquisition of a controlling interest in Redshaw Livestock Limited and the NZFLFL goodwill arose from the
acquisition of a finance book from Stock Plan Limited previously supplying finance to a number of NZ Farmers Livestock Limited customers.
Key Judgement
The assessment that there was no impairment of the goodwill in the Redshaw CGU ('cash generating unit') at 30 June 2023. The valuation of the
CGU is based on a discounted cashflow of management forecasts of future financial performance and therefore there is an inherent estimation
uncertainty.
Group
Post tax discount rate (leading to a pre-tax equivalent rate of 21.5%)
37

Allied Farmers Group
2023
2022
Revenue growth rate - reduced by
2.0%
2.0%
Pre tax discount rate - increased by
2.0%
2.0%
NZ Farmers Livestock Finance CGU
D3Associated Auctioneers
Group's Share
of Profit
Group's Share
of Assets
Group's Share
of Liabilities
Group's Share
of Revenues
Group's Share
of Expenses
$000$000$000$000$000
2023 32 392 (112) 692 (660)
2022 (45) 272 (37) 571 (616)
Measurement & Recognition
The Group's subsidiary NZ Farmers Livestock Limited owns a proportion (25-50%) of various sale yard tangible assets and has joint arrangements in
relation to the operation of these sale yards (referred to as 'Associated Auctioneers'). The Group has assessed the nature of its investment in
Associated Auctioneers as joint operations. As joint operations, the Group accounts for its share of the revenue, expenses, assets and liabilities.
These joint operations are in five different locations. These joint operations are charged with the operating activities of the sale yards including
conducting sales of livestock via the auction process, maintaining the sale yards, collecting levies on livestock sales and meeting operating costs of
the yards. If there is a shortfall in the income to meet the operating costs in any one year then the joint operation's parties are required to contribute to
the shortfall in the proportion of their ownership of the sale yards.
The joint operation of the sale yards is strategically vital to the interests of NZ Farmers Livestock Limited as the sale yards activity provide significant
income to NZ Farmers Livestock Limited via commission on the sale of livestock handled through the sale yards.
Management has identified that a reasonably possible change in key assumption could cause the carrying amount to exceed the recoverable
amount. The following table shows the amount by which these two assumptions would need to change individually for the estimated recoverable
amount to be equal to the carrying amount.
On an annual basis the recoverable amount of this goodwill is tested by undertaking an assessment of its value in use.

No impairment charge was required to be recognised in the financial statements. There are no foreseeable changes in assumptions which could
result in a material impairment.
38

Allied Farmers Group
E. Other
In this section
E1Related parties
Key management personnel ('KMP') compensation
20232022
$000 $000
Short term employee benefits
570
528
Directors fees
169
185
Directors Fees - NZ Rural Land Management Partnership
17
-
Transactions with related parties
20232022
$000 $000
Livestock sales
483
390
Livestock purchases
375
347
Commission revenue
22
12
Dividends received as minority shareholders of NZFL
1,213
435
20232022
$000 $000
Amount receivable from KMP
26
56
Amount receivable from NZRLC
1,044
-
Amount payable to KMP
9
27
No debts with key management personnel were written off during the year (2022: nil)
20232022
E2Auditors’ remuneration
$000 $000
Audit fees - KPMG (2021 auditors)
-
33
Fees for other services - KPMG
-
44
Audit fees - RSM Hayes Audit
118
100
Fees for other services RSM Hayes Audit
2
-
Direct expenses associated with the audit
18
8
Total
138 184
Identity of related parties
The Group has a related party relationship with each of its subsidiary companies, an associated entity and joint operation outlined in Section D.
Group
Related parties include key management personnel, their related parties, or directors/minority shareholders of NZFL.
Allied Farmers Limited obtained a loan of $3.66m (2022: nil) from Heartland Bank Limited in March 2023 which included an establishment fee of
$10,000. Allied Farmers Limited Director Shelley Ruha is a Director of Heartland Bank Limited. The loan is disclosed within Note B5. Interest paid for
2023 was $83,182 (2022: nil). NZ Farmers Livestock has an agreement with Heartland Bank pursuant to which NZFL receives referral fees. These
referral terms were arranged in April 2022, prior to Allied's and Heartland's commonality of directors. Referral fee income received since Shelley Ruha
was appointed a Director of the Group in November 2022 totalled $145,842, which represented Allied's share of drawdown fees and interest accrued
exceeding the base rate that Heartland earned and collected on any livestock finance transactions referred to by Allied. NZ Farmers Livestock has also
entered into six vehicle leases with KIA Finance provided by Heartland Bank Limited on arms length basis. The liability for which totalled $204,044 at 30
June 2023. Interest paid on these vehicle leases since Shelley Ruha was appointed as a Director of the Group was $6,864.
The vendors of NZRLM included Elevation Capital Management Limited a company controlled by a former Director of the Group Christopher Swasbrook
who owned 16.5% of NZRLM and Richard Milsom who directly and through a company controlled by him, owned 7.5%.
The acquisition of the 50% of NZRLM which the Group did not previously own was in accordance with the terms of the Call Option Deed, under which
the parties agreed to appoint PwC as valuer to determine the consideration, based on the fair value of NZRLM as of 18 December 2022.
Richard Milsom was appointed Managing Director of Allied Farmers Limited on 5 April 2023. Amounts paid to Mr Milsom under a contract of service for
2023 totalled $58,958 (2022: nil). These fees covered both services as Managing Director from 5 April 2023 and services managing NZRLM. Amounts
paid to Mr Milsom under a Service Agreement with NZRLM for 2023 totalled $36,458. Mr Milsom received distributions from NZRLM with payment by
way of shares in New Zealand Rural Land Company ('NZRLC') totalling $246,908. RP Milsom Investments Ltd also received distributions from NZRLM
with payment by way of shares in New Zealand Rural Land Company ('NZRLC') totalling $61,724. These distributions from NZRLM were received prior
to Mr Milsom becoming a Director of Allied Farmers Limited. These amounts relate to services to NZRLM only.
There were no consulting fees paid to entities associated with directors on an arms length basis total (2022: $28,871). Shelley Ruha received a fee of
$20,348 from NZRLM related to NZRLC property purchases.
NZRLM received property management fees and a transaction fee totalling $1,202,666 from NZRLC in the period since NZRLM became a subsidiary of
the Group in March 2023.
This section includes information required to comply with financial reporting standards that is not covered in other sections.
Consulting fees together with a share of distributions were paid by New Zealand Rural Land Management Partnership ('NZRLM') to Elevation Capital
Management Limited and Swasbrook Securities Limited, companies associated with Mr Christopher Swasbrook who is a former director of Allied
Farmers Limited. During the year, up to April 2023 when Mr Christopher Swasbrook ceased directorship with Allied Farmers, these totalled $97,713
(2022: $565,092). These were on commercial terms in accordance with a contract for service. Mr Swasbrook received distributions from NZRLM with
payment by way of shares in New Zealand Rural Land Company ('NZRLC') totalling $678,994.
Group
Group
Group
.
39

Allied Farmers Group
About this report
Statement of compliance and basis of preparation
The financial statements have been prepared:
-
-
-
presented on the basis of historical cost (except for certain financial assets measurered at fair value); and
-
-
Note A1
-
Note A2
-Note C4
Intangibles
-Note D2
Goodwill impairment assessment
These Consolidated Financial Statements ("Financial Statements") have been approved for issue by the Board of Directors on
28 August 2023.
in accordance with Generally Accepted Accounting Practice (GAAP) in New Zealand and comply with International Financial Reporting Standards
(IFRS) and the New Zealand equivalents to IFRS (NZ IFRS) and other applicable financial reporting standards, as appropriate for a Tier 1 for-profit
entity;
Allied Farmers Limited is a for-profit entity domiciled in New Zealand and registered under the Companies Act 1993. The company is an FMC Reporting
Entity in terms of the Financial Markets Conduct Act 2013 and prepares its financial statements in accordance with that Act, the Financial Reporting Act
2013, and NZX Main Board Listing Rules.
The consolidated financial statements are for Allied Farmers Limited and its subsidiaries (together referred to as "Allied") and Allied's interests in associates
as at the year ending 30 June 2023.
on the basis of going concern. The directors, having considered projected future performance and the availability of financing, consider the going
concern basis to be appropriate;
in New Zealand dollars, with all values rounded to the nearest thousand dollars unless otherwise stated.
In preparing the Group financial statements, all material intragroup transactions, balances, income and expenses have been eliminated. Subsidiaries are
consolidated on the date on which control is obtained to the date on which control is lost.
Critical Judgements and Estimates
The preparation of financial statements requires management to exercise its judgement in applying Allied's accounting policies. Estimates and judgements
are reviewed by management on an on-going basis, with revisions recognised in the period in which the estimate is revised and in any future periods
affected. Areas of estimate or judgement that have most significant impact on the amounts recognised in the financial statements are:
Revenue recognition
Deferred tax asset recognition
40

INDEPENDENT
AUDITOR’S REPORT
SEC

TION

7
41

Independent Auditor’s Report

To the shareholders of
Allied Farmers Limited

Opinion
We have audited the consolidated financial statements of Allied Farmers Limited and its subsidiaries (the
Group), which comprise:
- the consolidated balance sheet as at 30 June 2023;
- the consolidated profit and loss statement for the year then ended;
- the consolidated statement of other comprehensive income for the year then ended;
- the consolidated statement of changes in equity for the year then ended;
- the consolidated statement of cash flows for the year then ended; and
- the notes to the financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying consolidated financial statements on pages 22 to 40 present fairly, in all
material respects, the financial position of the Group as at 30 June 2023, and of its financial performance and its
cash flows for the year then ended in accordance with New Zealand equivalents to International Financial
Reporting Standards and International Financial Reporting Standards.
Basis for opinion
We conducted our audit in accordance with 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 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) (IESBA Code), and we have fulfilled our other ethical responsibilities in accordance with these
requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Other than in our capacity as auditor we have no relationship with, or interests in, Allied Farmers Limited or any
of its subsidiaries.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial statements for the current period. We identify two key audit matters as detailed on the next pages,
which were addressed in the context of our audit of the financial statements as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on this matter.

42

Revenue recognition
Why we considered this to be a key audit matter
The Group’s revenue arises from a variety of revenue
streams (as detailed in Note A1) which include
livestock (livestock agency services and veal
processing), livestock financial services, and
revenues from rural land management services.
With livestock agency services the gross
transactional cash flows exceed the reported levels
of revenue, given the adopted treatment to recognise
this revenue on a commission (i.e. agency) basis.
Because of the complexity of the accounting
requirements and varied nature of revenue streams
across the group we considered this to be a key audit
matter.
Our approach
Our procedures in relation to revenue recognition
included:
▪Reviewing a sample of contracts to ensure that
the group’s policy for the point of recognition is
in compliance with the requirements of NZ
IFRS 15 Revenue from contracts with
customers;
▪Understanding the processes and evaluating
the related controls implemented by the group
over revenue recognition;
▪Testing the operating effectiveness of controls
related to the recording of revenue from
livestock agency and veal processing revenue;
and
▪Performing tests of detail on a sample of
revenue transactions throughout the period
and in particular around year end to ensure
that these have been appropriately recognised.
We also evaluated and tested the policies for
revenue recognition adopted by the group’s joint
operations (associated auctioneers) and NZRLM.
We also evaluated the accounting polices applied
and considered disclosures relating to revenue
recognition, and the presentation of revenue in
current and prior period, as outlined in Note A1.
43

Acquisition of NZRLM
Why we considered this to be a key audit matter
As detailed in notes C2 Investments Held by Group
and C4 Intangible Assets, the Group’s increased
level of ownership has led to control being obtained
over NZRLM. The counterparties to this
transaction are also related to current and former
directors of the Group.
The Group considered whether it was appropriate to
apply the optional concentration test under NZ IFRS
3 Business Combinations.
The Group concluded that substantially all of the
value of the gross assets acquired related to the
NZRLM’s agreement to provide management
services to NZ Rural Land Company Limited.
Based on this conclusion the transaction has been
treated as the acquisition of an asset (the
management contract for NZRLC) by the Group
resulting in the recognition of a new intangible asset
of $10.4m on the Group’s balance sheet.
As the accounting for the acquisition and resulting
intangible asset has had a significant impact on the
balance sheet and will have a continuing impact on
the reported results, this area is considered to be a
key audit matter.
Our approach
We obtained an understanding of, and evaluated:
•The Group’s documentation of the
acquisition agreements and application
relative to the requirements of NZ IFRS 3
Business combinations.
•Details of the existing arrangements
between the Group and other previous
owners of NZRLM and the purchase of the
additional 50% ownership interest.
•The Group’s assessment of the
composition of the assets acquired, and
whether the optional concentration test was
met.
We then tested the measurement of consideration
transferred for the acquisition and ensured it was
recorded correctly in accordance with the
requirements of NZ IFRS 3 Business Combinations
and NZ IAS 38 Intangible Assets.
We also evaluated the adequacy of the disclosures
provided in relation the transaction, as detailed in
note C2 Investments Held by Group and C4
Intangible Assets.
Other information
The directors are responsible for the other information included in the annual report. The other information
provided is contained on pages 1 to 20 (but does not include the consolidated financial statements and our
auditor’s report thereon), which we obtained prior to the date of this auditor’s report. Our opinion on the
consolidated financial statements does not cover the other information and we do not express any form of audit
opinion or assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other
information identified above and, in doing so, consider whether the other information is materially inconsistent
with the consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be
materially misstated. If, based on the work we have performed on the other information that we obtained prior
to the date of this auditor’s report, we conclude that there is a material misstatement of this other information,
we are required to report that fact. We have nothing to report in this regard.
44

Responsibilities of the directors for the consolidated financial statements
The directors are responsible, on behalf of the group, for the preparation and fair presentation of the
consolidated financial statements in accordance with New Zealand equivalents to International Financial
Reporting Standards and International Financial Reporting Standards, and for such internal control as the
directors determine is necessary to enable the preparation of 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.
Auditor’s responsibilities for the audit of the consolidated financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit
conducted in accordance with ISAs (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 the auditor’s responsibilities for the audit of the
consolidated financial statements is located at the XRB’s website at:
https://www.xrb.govt.nz/assurance-standards/auditors-responsibilities/audit-report-1
Who we report to
This report is made solely to the company’s shareholders, as a body. Our audit work has been undertaken so
that we might state those matters which 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
Allied Farmers Limited and its shareholders, as a body, for our audit work, for this report or for the opinions we
have formed.
The engagement partner on the audit resulting in this independent auditor’s report is Jason Stinchcombe.
RSM Hayes Audit 28 August 2023
Auckland
45

COMPANY
DIRECTORY
Directors:
Shelley Ruha
59 Epsom Avenue,
Epsom, Auckland, 1023
Richard Milsom
34 Hukanui
Crescent,
Ponsonby,
Auckland, 1021
Philip Luscombe
8 Ronald Street
Strandon
New Plymouth, 4312
Registered Office of the
Company:
2
01 Broadway
Stratford 4332
Postal Address
of the Company:
P
.O. Box 304
Stratford 4352
Ph: 06 765 6199
Auditors:
RSM Hayes Audit
1 Broadway Newmarket
Auckland 1023
Share Registrar:
Link Market
Services Limited
PO Box 91976
Auckland 1142
Shareholder Enquiries:
Link Market Services
Limited Ph: 09 375 5998
Fax: 09 375 5990
Email:
lmsenquiries@linkmarketservices.com
PO Box 91976
Auckland 1142
SEC

TION
8
46

---

Results for announcement to the market
Name of issuer Allied Farmers Limited
Reporting Period 12 months to 30 June 2023
Previous Reporting Period 12 months to 30 June 2022
Currency NZD
Amount (000s) Percentage change
Revenue from continuing
operations
27,139 1.2%
Total Revenue 27,139 1.2%
Net profit/(loss) from
continuing operations
4,278 21.12%
Total net profit/(loss) 4,278 21.12%
Interim/Final Dividend
Amount per Quoted Equity
Security
No dividends proposed
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
$0.21 $0.48
A brief explanation of any of
the figures above necessary
to enable the figures to be
understood
Refer to results release and audited financial statements.


Authority for this announcement
Name of person

authorised
to make this announcement
Brian Lee
Contact person for this
announcement
Brian Lee
Contact phone number 027 201 3040
Contact email address brian.lee@alliedfarmers.co.nz
Date of release through MAP

28/08/2023

Audited financial statements accompany this announcement.