ENECO REFRESH LTD — Annual Report 2016

Aug 28, 2016

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Appendix 4E

Preliminary Final Report period ending 30 June 2016

Results for announcement to the market

Financial Results			June 2016	June 2015
Revenue from ordinary activities	Up	2.1%	6,120,013	5,994,351
Comprehensive Profit / (Loss) from ordinary activities after tax attributable to members	Up	162%	36,718	(59,079)

Dividends	2016 Final Dividend	2015 Final Dividend
Amount per Ordinary Security	nil	0.1 cent
Franked amount per Security	N/A	0.1 cent
Record date for determining entitlements to final dividend	N/A

Net Tangible Asset Backing	June 2016	June 2015
Net tangible asset backing per ordinary security	$0.04	$0.04

REFRESH GROUP LIMITED and its controlled entities

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COMMENTARY

Refresh is a good reflection of Australia’s 2-speed economy. Our operations in New South Wales and Victoria achieved record profits. Unfortunately, we have been badly affected in the mining states of Western Australia and Queensland. We are pleased that despite that, a small profit was achieved.

The launch of Refresh 12-litre suitable for use with water coolers and dispensers has met with good success. With Perth now blowing PET bottles from 350mL to 15-litre, it is able to extend the ranging of Refresh 5-litre into Woolworths supermarkets in Western Australia, besides being sold in Queensland, New South Wales, Australian Capital Territory and Victoria. The sale of Refresh coconut water is also progressing well.

As Refresh gears for growth, we have made some changes to strengthen our management team. Senior managers in Perth and Brisbane have been replaced. These have resulted in additional expenses for the two operations but better results are already achieved.

Refresh looked at several merger and acquisition opportunities. None was completed last year but we continue to negotiate with some of the parties and hope to achieve positive results this year.

On 8 August 2016, Refresh successfully completed a placement of 21 million shares, raising A$1,133,000. The placements were made to 2 companies whose directors have extensive experience in doing business in Asia. Their expertise and contributions will help Refresh adopt an export focus. Added to the good positive cash flow we currently have, this will put us in a very strong financial position to take the Company to the next level.

REFRESH GROUP LIMITED and its controlled entities

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PRELIMINARY FINAL REPORT CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE FINANCIAL YEAR ENDED 30 JUNE 2016

Revenue Cost of Sales Gross Profit Other income Marketing Expenses Distribution Expenses Administrative Expenses Occupancy Expenses Other Expenses Share of Net Profits/ (Loss) of associates Results from operating activities Finance income Finance costs Profit / (Loss) before income tax Income tax expense Profit/(Loss) for the year from continuing operations Profit/(Loss) for the year from discontinued operations Profit/(Loss) for the year Other comprehensive income Total comprehensive income/(loss) for the period Basic earnings/(loss) per share (cents per share)	Note	CONSOLIDATED 2016 $ 2015 $
	2a 2b 2c 2d	6,120,013 5,994,351 (2,787,260) (2,703,596)
		3,332,753 3,290,755 (10,086) (38,094) (514,101) (504,676) (975,494) (1,081,420) (1,297,727) (1,295,510) (471,783) (475,620) (6,000) (6,000) (36,999) 8,000
		20,563 (102,565) 24,812 43,486 (8,657) -
		36,718 (59,079) - -
		36,718 (59,079) - -
		36,718 (59,079) - -
		36,718 (59,079)
		0.03 -0.05

The accompanying notes form part of the Statement of Comprehensive Income

REFRESH GROUP LIMITED and its controlled entities

PRELIMINARY FINAL REPORT CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2016

ASSETS Current Assets Cash and cash equivalents Trade and other receivables Inventories Total Current Assets Non-Current Assets Other receivables Property, plant and equipment Intangible assets Investment in Associate Total Non-current assets TOTAL ASSETS LIABILITIES Current Liabilities Trade and other payables Financial liabilities Short-term provisions and accruals Total Current Liabilities Non-current Liabilities Financial liabilities Long-term provisions Total Non-current Liabilities TOTAL LIABILITIES NET ASSETS EQUITY Issued capital Reserves 2014 Profit Reserve Accumulated losses TOTAL EQUITY	Notes	CONSOLIDATED 2016 2015 $ $
	3 4 3 7 5	963,086 782,448 628,958 577,550 847,489 882,690
		2,439,533 2,242,688
		346,521 246,831 1,866,057 1,960,709 313,042 312,678 477,676 514,675
		3,003,296 3,034,893
		5,442,829 5,277,581
		400,654 388,497 55,871 - 320,162 361,185
		776,687 749,682
		200,748 - 64,264 51,691
		265,012 51,691
		1,041,699 801,373
		4,401,130 4,476,208
		9,368,401 9,368,401 191,712 191,712 356,409 468,205 (5,515,392) (5,552,110)
		4,401,130 4,476,208

The accompanying notes form part of the Statement of Financial Position

REFRESH GROUP LIMITED and its controlled entities

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PRELIMINARY FINAL REPORT CONSOLIDATED STATEMENT OF CHANGES IN EQUITY AS AT 30 JUNE 2016

Balance at 1 July 2014 Equity fund raising costs Issue of share capital Dividend Payment Profit/ (Loss) for the period Balance at 30 June 2015 Balance at 1 July 2015 Equity fund raising costs Issue of share capital Dividend Payment Profit/ (Loss) for the period Balance at 30 June 2016	Issued Capital Other Reserves 2014 Profit Reserve Accumulated Losses Total 9,275,015 191,712 580,000 (5,493,031) 4,553,696 (6,614) - - - (6,614) 100,000 - - - 100,000 - - (111,795) - (111,795)
	9,368,401 191,712 468,205 (5,493,031) 4,535,287 - - - (59,079) (59,079)
	9,368,401 191,712 468,205 (5,552,110) 4,476,208
	9,368,401 191,712 468,205 (5,552,110) 4,476,208 - - - - - - - - - - - - (111,796) - (111,796)
	9,368,401 191,712 356,409 (5,552,110) 4,364,412 - - - 36,718 36,718
	9,368,401 191,712 356,409 (5,515,392) 4,401,130

The accompanying notes form part of the Statements of Changes in Equity

REFRESH GROUP LIMITED and its controlled entities

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PRELIMINARY FINAL REPORT CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2016

Cash flows from operating activities Receipts from customers Payments to suppliers and employees Borrowing costs Interest received Net cash flows provided by operating activities Cash flows from investing activities Proceeds from sale of property, plant and equipment, and investment Purchase of intangible Purchase of property, plant and equipment Net cash flows provided by/(used in) investing activities Cash flows from financing activities Proceeds from issue of shares Proceeds from borrowings Share Issue expenses Dividends Paid Repayments of borrowings Net cash flows provided by/(used in) financing activities Net increase / (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	CONSOLIDATED 2016 2015 $ $
	6,271,437 6,043,789 (6,077,679) (8,657) (5,790,976) - 24,812 43,486
	209,913 296,299
	21,712 16,959 (6,364) (189,446) - (774,031)
	(174,098) (757,072)
	- 100,000 298,000 - - (6,614) (111,796) (111,795) (41,381) -
	144,823 (18,409)
	180,638 (479,182) 782,448 1,261,630
	963,086 782,448

The accompanying notes form part of the Statement of Cash Flows

REFRESH GROUP LIMITED and its controlled entities

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PRELIMINARY FINAL REPORT NOTES TO AND FORMING PART OF PRELIMINARY FINAL REPORT FOR THE YEAR ENDED 30 JUNE 2016

1. SEGMENT INFORMATION

The Group has identified its operating segments based on the internal reports that are reviewed and used by the Board of Directors (chief operating decision makers) in assessing performance and determining the allocation of resources.

In identifying its operating segment, management follows the geographical location of the Group’s operations. Corporate costs are included under “Other”. Segment information can be analysed as follows for the reporting period under review.

30 June 2016 Revenue from external customers Other Income Other Expense Interest Expense Depreciation Expense Segment operating profit/(loss) Total assets Total liabilities 30 June 2015 Revenue from external customers Other Income Other Expense Interest Expense Depreciation Expense Segment operating profit/(loss) Total assets Total liabilities

WA NSW VIC OTHER (Corporate) TOTAL

3,761,565 1,514,463 843,985 - 6,120,013 (5,727) 2,021 (6,380) - (10,086) - - 6,000 - 6,000 (8,657) - - - (8,657) 180,240 59,859 45,386 - 285,485 206,4311 168,318 137,413 (475,444) 36,718 3,545,041 717,419 466,252 714,117 5,442,829 830,788 4,908 1,864 204,139 1,041,699 3,886,789 1,255,347 852,216 - 5,994,352 (32,470) 3,898 (9,522) - (38,094) - - 6,000 - 6,000 - - - - - 151,902 61,959 46,234 - 260,095 232,5441 81,136 77,215 (449,974) (59,079) 3,380,906 804,249 528,537 563,889 5,277,581 571,232 3,825 1,626 224,690 801,373

[1 ] Include Profit/(Loss) from Associate

REFRESH GROUP LIMITED and its controlled entities

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PRELIMINARY FINAL REPORT NOTES TO AND FORMING PART OF PRELIMINARY FINAL REPORT FOR THE YEAR ENDED 30 JUNE 2016

2. REVENUE AND EXPENSES

a. Revenue Sale of bottled water, accessories and beverages b. Cost of Sales Inventory expensed Inventory write-off c. Finance Income Interest received d. Finance Costs Bank loans and other borrowings Finance charges payable under finance leases and hire purchase contracts e. Employee Benefits Expense Wages and salaries Workers compensation costs Superannuation costs Provisions for annual and long service leave Other employee benefits expense f. Depreciation & Amortisation Depreciation expense Amortisation	CONSOLIDATED 2016 2015 $ $
	6,120,013 5,994,351
	6,120,013 5,994,351
	2,686,658 2,634,547 100,602 69,049
	2,787,260 2,703,596
	24,812 43,486
	24,812 43,486
	- - 8,657 -
	8,657 -
	1,911,473 1,891,549 42,884 42,240 209,325 205,256 278 40,694 49,555 30,804
	2,213,515 2,210,543
	285,485 260,095 6,000 6,000
	291,485 266,095

REFRESH GROUP LIMITED and its controlled entities

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PRELIMINARY FINAL REPORT NOTES TO AND FORMING PART OF PRELIMINARY FINAL REPORT FOR THE YEAR ENDED 30 JUNE 2016

3. TRADE AND OTHER RECEIVABLES

				CONSOLIDATED	CONSOLIDATED
				2016	2015
Current				$	$
Trade receivables				447,068	484,735
Provision for impairment of receivables				(2,204)	(4,079)
				444,864	480,656
Other receivables				39,429	67,948
Prepayments				144,665	28,946
				628,958	577,550
Non-Current
Loan to Associate				346,521	246,831
				346,521	246,831
		Past due			Within
	Gross	and	Past due but not impaired		initial trade
	Amount	impaired	(days overdue)		terms
			31-60	61-90 >90
Consolidated
2016
Trade receivables	447,068	2,204	161,209	8,591 15,104	259,960
Other receivables	39,429	-	-	- -	39,429
	486,497	2,204	161,209	8,591 15,104	299,389
2015
Trade receivables	484,735	4,079	139,261	12,391 7,901	321,103
Other receivables	67,948	-	-	- -	67,948
	552,683	4,079	139,261	12,391 7,901	389,051

4. INVENTORIES

Raw materials (at cost) Finished goods (at cost) Total inventories at cost or net realisable value Provision for slow moving inventories	CONSOLIDATED 2016 2015 $ $
	473,895 425,837 415,674 505,944
	889,569 931,781 (42,080) (49,091)
	847,489 882,690

REFRESH GROUP LIMITED and its controlled entities

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PRELIMINARY FINAL REPORT NOTES TO AND FORMING PART OF PRELIMINARY FINAL REPORT FOR THE YEAR ENDED 30 JUNE 2016

5. TRADE AND OTHER PAYABLES

Current Trade payables Other payables	CONSOLIDATED 2016 2015 $ $
	246,762 236,968 153,892 151,529
	400,654 388,497

Trade payables are non-interest bearing and are normally settled on 60-day terms.

6. ACQUISITION

Nil

7. ASSOCIATE

	Place of	Proportion of Ordinary
	Business/	Share Interests /	Measurement
Name of Associate	Incorporation	Participating Share	Method	Carrying	Amount
		2016 2015		2016	2015
		% %		$	$
Refresh Waters	Queensland,	49 49	Equity	477,676	514,675
Queensland Pty Ltd	Australia

8. SIGNIFICANT EVENTS

Nil

9. EVENTS AFTER THE BALANCE SHEET DATE

On 8 August 2016, the Company raised $1,133,000 through the placement of 21,660,000 new shares to 2 new shareholders at 5.3 and 5.5 cents per share.

10. CONTINGENT ASSETS & LIABILITIES

There is no contingent liability between 30 June 2016 and the date of this report.

11. BASIS FOR PREPARATION

This preliminary final report has been prepared in accordance with ASX listing rule 4.3A and the disclosure requirements of ASX Appendix 4E. The accounting policies adopted in the preparation of the preliminary final report are consistent with those adopted in the preparation of the annual financial report.

12. UNAUDITED APPENDIX 4E

This report is in the process of being audited.

REFRESH GROUP LIMITED and its controlled entities

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