ENECO REFRESH LTD — Annual Report 2023

Aug 30, 2023

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Eneco Refresh Limited ( ACN 079 681 244) 17 Denninup Way, Malaga WA 6090 Tel: (08) 9248 7222 Email: info@eneco-refresh.com.au Website: www.eneco-refresh.com.au

Appendix 4E

Preliminary Final Report period ending 30 June 2023

Results for announcement to the market

Financial Results			June 2023	June 2022
Revenue from ordinary activities	Up	3.6%	14,485,683	13,977,257
Comprehensive profit (Loss) from ordinary activities after tax attributable to members	Up	148%	97,687	(205,505)

Dividends	2023 Final Dividend	2022 Final Dividend
Amount per Ordinary Security	nil	nil
Franked amount per Security	N/A	N/A
Record date for determining entitlements to final dividend	N/A

Net Tangible Asset Backing	June 2023	June 2022
Net tangible asset backing per ordinary security	$0.034	$0.034

ENECO REFRESH LIMITED and its controlled entities 1

COMMENTARY

Eneco Refresh Ltd (Eneco) is pleased to announce a 4% increase in revenue this year.

As part of a strategic review, Eneco has sold its factory in Darwin for $4.5 million. Eneco has no borrowings and the proceeds are held in cash which will give us further opportunity to grow the business.

Eneco continues to own 7.7 hectares of land in Acacia Hills, Northern Territory, where our spring is located. It holds a licence to draw 23 million litres of water per annum from the spring which continues to be a valuable resource for us.

A breakdown by Cash Generating Units is presented below.

Revenue Western Australia (WA) New South Wales (NSW) Victoria (VIC) Northern Territory (NT) Queensland (QLD) Refresh Waters Refresh Plastics Total Profit/(Loss) Western Australia New South Wales Victoria Northern Territory Queensland Refresh Waters Refresh Plastics Corporate Expenses Total		FY 2023 $'000 3,950 2,849 1,636 1,677 2,556	FY 2022 $'000 3,654 2,336 1,724 1,392 2,319 11,425 2,553 13,978 155 303 191 -356 187 480 -122 358 -564 -206	Variance
				8% 22% -5% 20% 10% 11% -29% 4% -159% 2% -86% 298% -19% 129% -231% 94% 6% -147%
		12,668 1,818
		14,486
		-91 308 27 705 151
		1,100 -404
		696 -598
		98

Refresh Waters

Refresh Waters sales have increased by 11%.

Its biggest growth of 22% comes from NSW. The custom labelled bottled water division is growing strongly as businesses invest more in marketing and promotion. Overall NSW has achieved our highest operating profit, similar to the last financial year.

ENECO REFRESH LIMITED and its controlled entities 2

NT had a 20% increase in revenue. This was in part due to increased sales in anticipation of our plant shutdown when we hand over the factory. The sale of the factory resulted in NT achieving a profit of $704,000.

QLD continues to grow steadily at 10%, mainly due to strong sales to Woolworths.

WA grew 8%. Growth has been broad based and is expected to continue this financial year.

VIC is the only CGU with a decline in sales due to the loss of some business, but is anticipated to pick up in this financial year.

Refresh Plastics

A fire broke out at the main Refresh Plastics factory on 8 February 2023. While the factory is not currently operational, it has continued to trade in plastic products, including Dolium one-way PET kegs for the beer, wine and beverage industries.

Despite this sales decline of 29%, as stated above, Eneco has achieved overall growth this financial year.

Eneco has made a claim on 2 insurance policies due to the fire:

• a. Industrial Special Risk - this policy includes coverage for equipment, inventory, and business continuation. The insurer has granted indemnity and paid an initial progress payment of $1 million. We have put through another $2.1 million in claims and expect to receive full payment.

• b. Public Liability – after the fire, EPA Victoria and Melbourne Water served notices to urgently clean up the surrounding areas. CSA Specialised Services Pty Ltd was appointed to undertake the job and a settlement sum of $1.89 million GST-inclusive has been agreed and paid. The public liability insurer has refused to this claim which is now being pursued through legal avenues.

ENECO REFRESH LIMITED and its controlled entities 3

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

FOR THE FINANCIAL YEAR ENDED 30 JUNE 2023

Note Revenue 2a Cost of Sales 2b Gross Profit Other Income Other Expense Marketing Expenses Distribution Expenses Administrative Expenses Occupancy Expenses Results from operating activities Finance Income 2c Finance Costs 2d Profit/(Loss) before income tax Income tax expense Profit/(Loss) after income tax Other comprehensive income Item not reclassified subsequently to profit or loss: Fair value gain/(loss) on financial assets at fair value through OCI Total comprehensive loss for the period Basic and diluted profit/(loss) per share (cents)	Note	CONSOLIDATED 2023 $ 2022 $
		14,485,683 13,977,257 (9,228,537) (8,572,147)
		5,257,146 5,405,110 1,063,296 - 66,643 (14,235) (744,626) (614,394) (2,019,341) (1,758,164) (2,549,689) (3,027,624) (836,999) (268,722)
		169,787 (211,386) 8,595 8,195 (80,695) (2,314)
		97,687 (205,505) - -
		97,687 - (205,505) (24,628)
		97,687 (230,133)
		0.036 (0.075)

The accompanying notes form part of the Statement of Comprehensive Income

ENECO REFRESH LIMITED and its controlled entities 4

PRELIMINARY FINAL REPORT CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2023

ASSETS Current Assets Cash and cash equivalents Trade and other receivables Prepayments Inventories Current tax asset Total Current Assets Non-Current Assets Property, plant and equipment Intangible assets Financial assets at fair value through OCI Investment in associate Right of use asset Total Non-Current Assets TOTAL ASSETS LIABILITIES Current Liabilities Trade and other payables Short-term provisions and accruals Current tax liabilities Lease liabilities Total Current Liabilities Non-current Liabilities Long-term provisions Lease liabilities Total Non-Current Liabilities TOTAL LIABILITIES NET ASSETS EQUITY Issued capital Share reserve Profit reserve Financial asset revaluation reserve Accumulated losses TOTAL EQUITY	Notes	CONSOLIDATED 2023 2022 $ $
	3 4 7 5	5,395,189 1,283,574 3,475,309 1,275,871 227,187 130,175 1,919,423 1,993,991 34,361 34,361
		11,051,469 4,717,972
		2,507,347 6,618,342 558,843 562,171 16,400 16,400 50,000 50,000 2,193,160 2,846,062
		5,325,750 10,092,975
		16,377,219 14,810,947
		3,347,867 1,023,580 784,444 982,246 37,509 - 379,017 683,173
		4,548,837 2,688,999
		13,712 25,616 1,821,309 2,200,324
		1,835,021 2,225,940
		6,383,858 4,914,939
		9,993,361 9,896,008
		18,320,875 18,320,875 191,712 191,712 356,409 356,409 50,683 50,683 (8,926,318) (9,023,671)
		9,993,361 9,896,008

The accompanying notes form part of the Statement of Financial Position

ENECO REFRESH LIMITED and its controlled entities 5

PRELIMINARY FINAL REPORT CONSOLIDATED STATEMENT OF CHANGES IN EQUITY AS AT 30 JUNE 2023

Balance at 1 July 2021 Fair value gain on available- for sale financial assets Total (Loss) for the year Balance at 30 June 2022 Balance at 1 July 2022 Fair value gain on available- for sale financial assets Total profit for the year Balance at 30 June 2023	Issued Capital Share Reserve Profit Reserve Financial Asset Revaluation Reserve Accumulated Losses Total 18,320,875 191,712 356,409 75,311 (8,818,166) 10,126,141 - - (24,628) - (24,628) 18,320,875 191,712 356,409 50,683 (8,818,166) 10,101,513 - - - - (205,505) (205,505) 18,320,875 191,712 356,409 50,683 (9,023,671) 9,896,008
	18,320,875 191,712 356,409 50,683 (9,023,671) 9,896,008 - - - - - - 18,320,875 191,712 356,409 50,683 (9,023,671) 9,896,008 - - - - 97,687 97,687 18,320,875 191,712 356,409 50,683 (8,926,318) 9,993,361

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

ENECO REFRESH LIMITED and its controlled entities 6

PRELIMINARY FINAL REPORT CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2023

Cash flows from operating activities Receipts from customers Receipt from insurer Payments to suppliers and employees Interest received Government grants and tax incentives Net cash flows provided by operating activities Cash flows from investing activities Proceeds from sale of property, plant and equipment, and investment Purchase of property, plant and equipment Investment Net cash flows provided by / used in investing activities Cash flows from financing activities Repayments of borrowings Other- AASB 16 Prepayment for the Principal Net cash flows used in financing activities Net (decrease) / increase in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	CONSOLIDATED 2023 2022 $ $
	13,483,172 1,000,000 14,474,803 - (13,905,207) (13,938,886) 8,595 8,195 25,000 58,880
	611,560 602,992
	4,503,766 9,250 (320,539) (329,396) - (18,228)
	4,183,228 (338,374)
	- - (683,173) (435,915)
	(683,173) (435,915)
	4,111,615 (171,297) 1,283,574 1,454,871
	5,395,189 1,283,574

The accompanying notes form part of the Statement of Cash Flows

ENECO REFRESH LIMITED and its controlled entities 7

PRELIMINARY FINAL REPORT NOTES TO AND FORMING PART OF PRELIMINARY FINAL REPORT FOR THE YEAR ENDED 30 JUNE 2023

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 segments, management follows the geographical location of the Group’s bottled water business, but show Refresh Plastics separately. Corporate costs are included under “Other”. Segment information can be analysed as follows for the reporting period under review.

30 June 2023 Revenue from external customers EBITDA Depreciation Expense Finance Income Finance Costs Profit on asset sales Segment operating profit/(loss) Total assets Total liabilities 30 June 2022 Revenue from external customers EBITDA Depreciation Expense Finance Income Finance Costs Segment operating profit/(loss) Total assets Total liabilities	WA NSW VIC NT QLD Plastics OTHER (Corporate) TOTAL
	3,949,551 2,849,008 1,636,488 1,677,235 2,555,539 1,817,861 - 14,485,682 242,351 375,604 91,834 (239,132) 349,009 (74,620) (602,342) 142,704 (318,457) (58,851) (74,318) (49,605) (172,809) (362,173) (1,036,213) 3,615 - - - 203 477 4,300 8,595 (38,187) (8,342) - - (25,387) (8,779) - (80,695) 19,752 - 9,077 993,157 - 41,310 - 1,063,296
	(90,926) 308,411 26,593 704,420 151,016 (403,785) (598,042) 97,687 7,439,324 1,470,430 1,121,018 1,112,331 1,875,578 2,863,487 495,048 16,377,218 1,563,956 656,175 184,745 189,157 1,010,385 2,473,026 306,412 6,383,857 3,653,801 2,336,193 1,724,149 1,392,093 2,318,496 2,552,525 - 13,977,257 537,106 309,850 244,696 (279,234) 376,410 196,220 (570,652) 814,396 (342,775) (64,496) (53,930) (76,819) (173,480) (314,282) - (1,025,782) 1,056 - - - 5 17 7,117 8,195 40,465 (58,176) - - 15,397 - - (2,314)
	235,852 187,178 190,766 (356,053) 218,332 (118,045) (563,535) (205,505) 4,397,129 1,174,122 928,714 4,399,861 1,371,578 1,771,421 768,122 14,810,947 1,138,686 729,781 536,687 434,461 1,067,837 685,710 321,777 4,914,939

ENECO REFRESH LIMITED and its controlled entities 8

PRELIMINARY FINAL REPORT NOTES TO AND FORMING PART OF PRELIMINARY FINAL REPORT FOR THE YEAR ENDED 30 JUNE 2023

2. REVENUE AND EXPENSES

a. Revenue Production and distribution of bottled water and accessories Production and distribution of plastic products b. Cost of Sales Inventory expensed Inventory write-off/(write-back) c. Finance Income Interest received d. Finance Costs 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	CONSOLIDATED 2023 2022 $ $
	12,667,822 11,424,732 1,817,861 2,552,525
	14,485,683 13,977,257
	9,253,471 8,627,233 (24,934) (55,086)
	9,228,537 8,572,147
	8,595 8,195
	8,595 8,195
	(80,695) (121,161)
	(80,695) (121,161)
	4,936,905 2,597,488 109,654 75,439 468,179 399,387 (36,793) 44,042 269,784 230,419
	5,747,729 3,346,775
	1,036,214 1,025,782
	1,036,214 1,025,782

ENECO REFRESH LIMITED and its controlled entities 9

PRELIMINARY FINAL REPORT NOTES TO AND FORMING PART OF PRELIMINARY FINAL REPORT FOR THE YEAR ENDED 30 JUNE 2023

3. TRADE AND OTHER RECEIVABLES

	CONSOLIDATED	CONSOLIDATED
	2023	2022
Current	$	$
Trade receivables	1,322,637	1,254,668
Provision for expected credit losses	(12,824)	(16,327)
Other receivables	2,165,496	37,530
	3,475,309	1,275,871
Movement in the provision for expected credit losses of trade receivables:
Balance at the beginning of the year	16,327	7,357
Additional provision for expected credit losses of trade receivables	(789)	15,120
Receivables written off during the year as uncollectable	(2,714)	(6,150)
Balance at the end of the year	12,824	16,327

Allowance for expected credit losses

The Group has recognised $2,714 (2022: $6,150) in profit or loss in respect of the expected credit losses for the year ended 30 June 2023.

4. INVENTORIES

Raw materials (at cost) Finished goods (at cost) Total inventories at cost Provision for slow moving inventories	CONSOLIDATED 2023 2022 $ $
	1,127,987 1,310,356 831,320 789,363
	1,959,307 2,099,719 (39,884) (105,728)
	1,919,423 1,993,991

5. TRADE AND OTHER PAYABLES

TRADE AND OTHER PAYABLES
Current Trade payables Other payables	CONSOLIDATED 2023 2022 $ $
	3,008,731 777,265 339.136 246,315
	3,334,867 1,023,580

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

ENECO REFRESH LIMITED and its controlled entities 10

PRELIMINARY FINAL REPORT NOTES TO AND FORMING PART OF PRELIMINARY FINAL REPORT

FOR THE YEAR ENDED 30 JUNE 2023

6. ACQUISITION

Nil

7. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME (OCI)

On 30 June 2023, Refresh Eneco owns 16,400,000 shares in Eve Health Group Ltd, which is listed on the Australian Securities Exchange (ASX:EVE). This is carried in its books at $0.001 per share, being the last traded price on ASX on 30 June 2023. The fair value changes have been accounted for through OCI.

8. SIGNIFICANT EVENTS

A fire broke out at the Company’s plastics factory on 8 Feb 23. The Company is in the midst of its fire insurance claims.

The Company sold its factory and land in Darwin for $4.5 million on 9 June 23.

9. EVENTS AFTER THE BALANCE SHEET DATE

On 15 Aug 23, the Company sold its Northern Territory assets and business to Territory Spring Water AU Pty Ltd for $400,000.

10. CONTINGENT ASSETS & LIABILITIES

There is no contingent liability between 30 June 2023 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.

ENECO REFRESH LIMITED and its controlled entities 11