EMBELTON LIMITED — Annual Report 2021

Aug 24, 2021

Preliminary Final Report ASX Listing Rule 4.3A

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Preliminary Final Report and Dividend Announcement

EMBELTON LIMITED ACN 004 401 496 For Year Ended 30 June 2021

Results for Announcement to the Market

$A'000 Total Revenues Down 5.8% to 68,222 Profit after tax attributable to members Down 33.3% to 1,439 Net profit for the period attributable to members Down 33.0% to 1,441
Dividends (distributions)	Amount per security		Franked amount per security
Interim Dividend Final Dividend Ordinary Dividend Total Dividends for year		20.0¢ 20.0¢ 40.0¢		20.0¢ 20.0¢ 40.0¢
Previous Corresponding Period: Interim Dividend Final Ordinary Dividend Total Dividends for year		20.0¢ 20.0¢ 40.0¢		20.0¢ 20.0¢ 40.0¢
Record date for determining entitlements to the dividend 24 September 2021

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Preliminary Final Report ASX Listing Rule 4.3A

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Condensed consolidated statement of comprehensive income

Total Revenues Expenses Finance costs Profit before tax Income tax Profit after tax Other Comprehensive income Total Comprehensive income Net profit for the period attributable to members Total Comprehensive income attributable to members	Current period ($A'000)	Previous corresponding period ($A'000)
	68,222	72,445
	65,931 180	68,923 342
	2,111 672	3,180 1,023
	1,439 2	2,157 (5)
	1,441	2,152
	1,441	2,152
	1,441	2,152

Consolidated retained profits

	Retained profits at the beginning of the financial period Net profit attributable to members Dividends and other equity distributions paid Retained profits at end of financial period	Current period ($A'000)	Previous corresponding period ($A'000)
		17,414 1,441 (865)	16,120 2,157 (863)
		17,990	17,414

Earnings per security (EPS)

	Basic EPS Diluted EPS	Current period	Previous corresponding period
		67 cents 67 cents	100 cents 100 cents

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Preliminary Final Report ASX Listing Rule 4.3A

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Notes to the condensed consolidated statement of comprehensive income

Revenue and expenses

	Revenue from sales or services Interest revenue Other relevant revenue Total Revenues Details of relevant expenses Cost of goods sold Depreciation and amortisation including amortisation of intangibles	Current period ($A'000)	Previous corresponding period ($A'000)
		68,117 0	72,324 1
		105	120
		68,222	72,445
		52,675 983	53,449 1,060

Comparison of half year profits

Comparison of half year profits
Consolidated profit after tax attributable to members reported for the 1st half year	Current year ($A'000)	Previous year ($A'000)
	848	951
Consolidated profit after tax attributable to members for the 2nd half year	593	1,201

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Preliminary Final Report ASX Listing Rule 4.3A

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Condensed consolidated statement of financial position

Current assets Cash and cash equivalents Receivables Inventories Current Tax Assets Other Total current assets	At end of current period ($A'000)	At end of corresponding prior period ($A'000)
	86 8,855 12,447 107 527	25 12,604 12,072 0 155
	22,022	24,856
Non-current assets Property, plant and equipment (net) Right of Use Assets Intangibles Tax assets Total non-current assets	9,211 434 330 685	9,262 450 397 888
	10,660	10,997
Total assets	32,682	35,853
Current liabilities Payables Borrowings Lease liabilities Tax liabilities Provisions exc. tax liabilities Total current liabilities	10,406 0 389 0 1,423	8,713 5,623 333 584 1,489
	12,218	16,742
Non-current liabilities Tax liabilities Borrowings Lease liabilities Provisions exc. tax liabilities Total non-current liabilities	75 1,000 59 181	59 - 168 313
	1,315	540
Total liabilities	13,533	17,282
Net assets	19,149	18,571
Equity Contributed equity Reserves Retained profits	1,156 3 17,990	1,156 1 17,414
Equity attributable to members of the parent entity Total equity	19,149	18,571
	19,149	18,571

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Preliminary Final Report ASX Listing Rule 4.3A

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Condensed consolidated statement of cash flows

	Cash flows related to operating activities Receipts from customers Payments to suppliers and employees Interest and other items of similar nature received Finance costs Income taxes paid Net operating cash flows	Current period ($A'000)	Previous corresponding period ($A'000)
		79,118 (71,287) 0 (209) (1,151)	74,473 (71,115) 1 (342) (561)
		6,471	2,456
	Cash flows related to investing activities Payment for purchases of property, plant and equipment Proceeds from sale of property, plant and equipment Acquisition of business	(505) 45 0	(258) 8 (368)
	Net investing cash flows	(460)	(618)
	Cash flows related to financing activities Repayment of Lease Liability Repayment of Borrowings Dividends paid Net financing cash flows	(464) (4,623) (863)	(480) (485) (863)
		(5,950)	(1,828)
	Net Increase/(decrease) in cash held Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	61 25	(10) 35
		86	25

Notes to the Condensed Consolidated Statement of Cash Flows

Reconciliation of cash and cash equivalents

Reconciliation of cash at the end of the period (as shown in the consolidated cash flow statement) to the related items in the accounts is as follows.	Current period ($A'000)	Previous corresponding period($A'000)
Cash on hand and at bank Commercial Bills Deposits at call Total cash and cash equivalents at end of period	86 - -	25 - -
	86	25

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Preliminary Final Report ASX Listing Rule 4.3A

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Statement of Changes in Equity

At 30 June 2019 Profit for the period Other Comprehensive income Total Comprehensive income Dividends paid At 30 June 2020	Contributed Equity ($A'000)	Foreign Currency Translation Reserve ($A'000)	Retained Profits ($A'000)	Total ($A'000)
	1,156 - -	6 - (5)	16,120 2,157 -	17,282 2,157 (5)
	- -	(5) -	2,157 (863)	2,152 (863)
	1,156	1	17,414	18,571
Profit for the period Other Comprehensive income Total Comprehensive income Dividends paid At 30 June 2021	- -	- 2	1,439 -	1,439 2
	- -	2 -	1,439 (863)	1,441 (863)
	1,156	3	17,990	19,149

Other notes to the condensed financial statements

Ratios Profit before tax / revenue Consolidated profit before tax as a percentage of revenue	Current period	Previous corresponding Period
	3.1%	4.3%
Profit after tax / equity interests Consolidated net profit after tax attributable to members as a percentage of equity (similarly attributable) at the end ofthe period	7.5%	11.6%

	NTA backing Net tangible asset backing per ordinary security (Includes ROU Assets and Lease Liabilities)	Current period	Previous corresponding period
		$8.72	$8.43

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Preliminary Final Report ASX Listing Rule 4.3A

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Dividends

Date the dividend (distribution) is payable

15 October 2021

Record date to determine entitlements to the dividend If it is a final dividend, has it been declared?

24 September 2021

This is a declared Final Dividend

Amount per security

mount per security
	Amount per security	Franked amount per security (at 30% tax)	Amount per security of foreign source dividend
Final Dividend: Current Year Ordinary Final Dividend Previous Year Ordinary Dividend	20.0¢ 20.0¢	20.0¢ 20.0¢	Nil Nil
Interim dividend:Current year Previous year	20.0¢ 20.0¢	20.0¢ 20.0¢	Nil Nil

Total dividend per security (interim plus final)

Ordinary securities Preference securities	Current year	Previous year
	40.0¢ -	40.0¢ -

Preliminary final report – total dividend for the year on all securities

Ordinary securities Preference securities Other equity instruments Total	Current period ($A'000)	Previous corresponding period($A'000)
	865 - -	863 - -
	865	863

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Preliminary Final Report ASX Listing Rule 4.3A

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Segmental Information

12 months to June 2021 Revenue Total Operating Revenue Less Elimination on Consolidation Total External Operating Revenue Results Segment results Assets 12 months to June 2020 Revenue Total Operating Revenue Less Elimination on Consolidation Total External Operating Revenue Results Segment results Assets	Merchandising ($A'000)	Commercial ($A'000)	Manufacturing ($A'000)	Consolidated ($A'000)
	24,647	44,311	5,978	74,936
	-	(1,094)	(5,725)	(6,819)
	24,647	43,217	253	68,117
	162	2,316	(168)	2,310
	Unallocated expenses Total Operating Profit before Income Tax			(199)
				2,111
	11,065	18,804	2,221	32,090
	Unallocated assets Total Assets			592
				32,682
	28,059	45,662	6,984	80,705
	-	(1,700)	(6,681)	(8,381)
	28,059	43,962	303	72,324
	1,384	1,764	237	3,385
	Unallocated expenses Total Operating Profit before income tax			(205)
				3,180
	12,604	19,549	2,755	34,908
	Unallocated assets Total Assets			945
				35,853

DIRECTORS COMMENTS

The Group finished a difficult year with revenue falling by almost 6%, largely as a result of the nationwide contraction in high density residential construction which has been an area of focus for the Company in recent years. With closed borders and a significant reduction in international investment, demand for multi-storey residential accommodation has declined, resulting in widespread project delays and deferrals.

The lower profit recorded for the period was also impacted by significant costs associated with the new Flooring Online platform which was launched at the beginning of the financial year. Development of this new activity, directed towards replacement of our declining wholesale flooring business, had been expected to detract from earnings due to the significant early-stage advertising and marketing expense not being matched by revenues. Nonetheless, the online retail concept for floor coverings holds sufficient promise to warrant additional investment in the coming period.

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Preliminary Final Report ASX Listing Rule 4.3A

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With Covid lockdowns and border closures likely to be maintained in the near term, the Group expects continuing headwinds in our core Contracting and Engineering businesses. Faced with this fluid business environment, some adjustments have been made in the Group operating structure to better manage resources and maintain profitability during the challenging period ahead .

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Preliminary Final Report ASX Listing Rule 4.3A

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Basis of financial report preparation

Material factors affecting the revenues and expenses of the economic entity for the current period.

NIL

A description of each event since the end of the current period which has had a material effect and which is not already reported elsewhere in this Appendix or in attachments, with financial effect quantified (if possible).

NIL

Unless disclosed below, the accounting policies, estimation methods and measurement bases used in this report are the same as those used in the last annual report. Any changes in accounting policies, estimation methods and measurement bases since the last annual report are disclosed as follows. (Disclose changes and differences in the half yearly report in accordance with AASB 1029: Interim Financial Reporting . Disclose changes in accounting policies in the preliminary final report in accordance with AASB 1001: Accounting Policies-Disclosure ).

NIL

Revisions in estimates of amounts reported in previous interim periods. For half yearly reports the nature and amount of revisions in estimates of amounts reported in previous annual reports if those revisions have a material effect in this half year.

NIL

Changes in contingent liabilities or assets. For half yearly reports, changes in contingent liabilities and contingent assets since the last annual report.

NIL

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Preliminary Final Report ASX Listing Rule 4.3A

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Annual meeting

The annual meeting will be held as follows:

Place 147 Bakers Road, Coburg VIC 3058 Date 3 November 2021 Time 11.00am Approximate date the annual report will be available 30 September 2021

Compliance statement

1. This report has been prepared in accordance with AASB Standards, other AASB authoritative pronouncements and Urgent Issues Group Consensus Views or other standards acceptable to ASX .

2. This report, and the accounts upon which the report is based (if separate), use the same accounting policies.

3. This report does give a true and fair view of the matters disclosed (see note 2).

4. This report is based on accounts to which one of the following applies. (Mark one)

The accounts have been The accounts have been audited. subject to review. The accounts are in the The accounts have not yet process of being audited or been audited or reviewed. subject to review.

1. If the audit report or review by the auditor is not attached, details of any qualifications are attached/will follow immediately they are available.

2. The entity does not have a formally constituted audit committee.

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James Embelton Managing Director

25 August 2021

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