HANSEN TECHNOLOGIES LIMITED — Interim / Quarterly Report 2015

Aug 26, 2015

HANSEN TECHNOLOGIES LTD ABN 90 090 996 455 AND CONTROLLED ENTITIES

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FINANCIAL INFORMATION FOR THE YEAR ENDED 30 JUNE 2015 PROVIDED TO THE ASX UNDER LISTING RULE 4.3A

Rule 4.3A

Appendix 4E Preliminary Final Report

Hansen Technologies Limited and its Controlled Entities

ABN or equivalent company reference: ABN: 90 090 996 455

1. Reporting period

Report for the financial year ended: 30 June 2015 Previous corresponding period is 30 June 2014 the financial year ended:

2. Results for announcement to the market

Operating revenues from ordinary activities Profit from ordinary activities after tax attributable to members	2015 $’000 2014 $’000
	Up 24% 106,257 86,021 Up 14% 16,944 14,801
	Amount per security	Franked amount per security
Final Dividend
Final dividend for the year ended 30 June 2015	3.0¢	2.5¢
Final dividend for previous corresponding period	3.0¢	3.0¢
Payment date for the final dividend for the year ended 30 June 2015	30 September 2015
Record date for determining entitlement to the future dividend	9 September 2015

Interim Dividend
Interim dividend for the 2015 fiscal year	3.0¢	2.5¢
Interim dividend for previous corresponding period	3.0¢	2.5¢
Payment date for the interim dividend	27 March 2015
A final dividend of 3.0 cents per share, 2.5c franked, has been declared, bringing the total dividend for the year to 6.0 cents per share, with 5.0 cents being fully franked and 1.0 cent being unfranked. Please refer to the attached preliminary financial report for the year ended 30 June 2015 and the accompanying press release for more detail.

3. Statement of Comprehensive Income

Refer to the attached statement and relevant notes

4. Statement of Financial Position

Refer to the attached statement and relevant notes

5. Statement of Cash Flows

Refer to the attached statement and relevant notes

6. Dividends

6. Dividends
Three cent final dividend – year ended 30 June 2014 Three cent interim dividend – year ended 30 June 2015 Three cent final dividend – year ended 30 June 2015	Date of payment	Total amount of dividend
	30 September 2014	$4,874,390
	27 March 2015	$4,898,691
	30 September 2015	$5,301,010

Amount per security

Amount per security
	Amount per security	Franked amount per security at % tax	Amount per security of foreign sourced dividend
Total dividend:Current year (interim)	3.0¢	83%	0¢
Previous year (interim)	3.0¢	83%	0¢
Current year (final)	3.0¢	83%	0¢
Previous year (final)	3.0¢	100%	0¢

Total dividend paid on all securities

Ordinary securities Total	Within the current fiscal year $A'000	Previous fiscal year $A'000
	9,773	9,625
	9,773	9,625

7. Details of dividend or distribution reinvestment plans in operation are described below

A Dividend Reinvestment Plan has been established to provide shareholders with the opportunity to reinvest dividends in new shares rather than receiving cash. Detail of Hansen’s Dividend Reinvestment Plan including the share pricing methodology is available on line at www.hsntech.com/investors/shareholder-information

The price for shares to be applied for in accordance with the DRP plan for this dividend shall be the full undiscounted value as prescribed by the plan.

The conduit foreign income component of this final dividend is nil.

The last date for receipt of election notices for 10 September 2015 participation in the dividend or distribution reinvestment plan

8. Statement of retained earnings

8. Statement of retained earnings
	Consolidated Entity
	2015 2014
	$’000 $’000
Balance at the beginning of year	22,318 17,142
Net profit attributable to members of the
parent entity	16,944 14,801
Total available for appropriation	39,262 31,943
Dividends paid	(9,773) (9,625)
Balance at end of year	29,489 22,318

9. Net tangible assets per security

Net tangible asset backing per ordinary security

Current period	Previous corresponding period
5.6 cents	-1.9 cents

10. Details of entities over which control has been gained during the period

Name of entity (first)

Date of gain of control

Contribution to consolidated profit from ordinary activities after tax since the date in the current period when control was acquired

Profit from ordinary activities after tax for the whole of the previous corresponding period

Hansen Holdings Europe Limited (was incorporated to purchase 100% share capital in TeleBilling A/S) 07/5/2015 ($310,711) Nil.

Name of entity

Date of gain of control

Contribution to consolidated profit from ordinary activities after tax since the date in the current period when control was acquired

Profit from ordinary activities after tax for the whole of the previous corresponding period

TeleBilling A/S (the trading entity, incorporated in Denmark) 12/5/2015 (effective from 1/5/2015) $743,324 It is impracticable to disclose this detail as the TeleBilling business prior to our purchase was being accounted in Denmark in compliance with Danish General Accepted Accounting principles resulting in different accounting treatments to IFRS. Additionally, TeleBilling Systems A/S operated on conflicting comparative balance date.

11. Details of associates and joint venture entities

None

12. Significant information relating to the entity’s financial performance and financial position.

Results from Operations for the full year 2015

	FY15 $A million	FY14 $A million	Variance
Operatingrevenue	106.3	86.0	up24%
EBITDA	31.3	24.1	up 30%
Profit before tax	24.0	19.5	up23%
Income tax expense	(7.1)	(4.7)	up51%
Netprofit after tax	16.9	14.8	up14%
Earningsper share	10.3 cents	9.2 cents	up12%

Please refer to the attached Statements and Relevant Notes.

During the reported fiscal year the Company made the following acquisition;

Hansen Holdings Europe Limited was incorporated to purchase 100% of the share capital of TeleBilling A/S. Control of TeleBilling was gained on 12 of May 2105 (effective 1 May 2015). The purchase price was 167 million Danish Kroner (DKK) approximately A$31.5 million.

During the year a new A$30 million multicurrency 3 year facility was negotiated, replacing the existing A$20 million facility. The new facility is secured on 90% of the groups assets. This facility supplemented company cash flows in the acquisition of the TeleBilling business. The loan was drawn to A$10 million at balance date and has subsequently been repaid.

Refer section 14 for additional comments.

13. The financial information provided in the Appendix 4E is based on the preliminary financial report (attached), which has been prepared in accordance with Australian Accounting Standards.

14. Commentary on the results for the period.

Hansen is pleased to report a record breaking performance for the fiscal year with both revenue and earnings per share exceeding previous bench marks.

The company’s growth and profit performance is an achievement all Hansen Staff can be proud of. I wish to extend my congratulations and thanks to the 500+ staff across the globe whose contribution and commitment delivered this outstanding result.

Key milestones

These results include the first full year of the Banner business purchased in May 2014. The Banner business has extended our reach into utilities billing with a broadening of our customer base to include electricity, gas and water for major industry leaders as well as municipalities.

We completed a further transaction within the period of the TeleBilling business. This acquisition, while focussing on our core competency of customer care and billing, extends our telecommunications and Pay TV offering into central and northern Europe.

Customer relationships continued to be strengthened with an ongoing investment in research and development. This investment has been welcomed by our customers as we focus development to deliver positive outcomes to their businesses.

The employment of key staff has continued throughout the year as we expand the international infrastructure to ensure our keen eye for detail is maintained both on new sales opportunities as well as customer delivery.

We continue to build an internationally focussed business that is well placed to take advantage of the expanding markets.

A pleasing aspect of the result was the strong cash flow generated from operations. Since year end the bank facility has been repaid in full.

Recent Strategic Acquisitions

The acquisition of the TeleBilling business in May 2015 has been a natural addition to the Hansen business. The naviBilling product complements Hansen’s existing customer care and billing products and provides a critical mass of established telecommunications and Pay TV clients. In addition Hansen’s capabilities have been expanded to include Enterprise Resource Planning ( ERP ) and Customer Relationship Management ( CRM ) software.

The acquisition has expanded the Hansen family by a further 90+ staff who share our excitement as we work to integrate the business.

14. Audit of the financial report

The financial report is in the process of being audited.

15. The audit has not yet been completed

The financial report is not likely to contain an independent audit report that is subject to a modified opinion, emphasis of matter or other matter paragraph.

Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

Hansen Technologies Ltd and Controlled Entities Consolidated Statement of Comprehensive Income For the Year Ended 30 June 2015

Hansen Technologies Ltd and Controlled Entities Consolidated Statement of Comprehensive Income For the Year Ended 30 June 2015
Note Revenue from continuing operations 4 Other income 4 Total revenues and other income Employee expenses 5 Depreciation expense 5 Amortisation expense 5 Property and operating rental expenses 5 Contractor and consultant expenses Software licence expenses Hardware and software expenses Travel expenses Communication expenses Professional expenses Other expenses Total expenses Profit before income tax Income tax expense Profit after income tax from ongoing operations Other comprehensive income / (expense) Items that may be reclassified subsequently to profit and loss Exchange differences on translation of foreign operations 3 Other comprehensive income / (expense) for the year Total comprehensive income for the year attributable to members of the parent Basic earnings (cents) per share for continuing operations 17 Total basic earnings (cents) per share Diluted earnings (cents) per share for continuing operations 17 Total diluted earnings (cents) per share	Consolidated Entity
	2015	2014
	$'000	$'000
	106,257 475	86,021 436
	106,732 (55,295) (1,863) (5,213) (4,575) (1,582) (1,092) (3,251) (3,719) (1,768) (1,407) (2,964)	86,457 (46,425) (1,588) (3,130) (3,993) (1,779) (443) (2,741) (2,317) (808) (1,022) (2,753)
	(82,729)	(66,999)
	24,003 (7,059)	19,458 (4,657)
	16,944	14,801
	10,052	(658)
	10,052	(658)
	26,996	14,143
	10.3	9.2
	10.3 10.0	9.2 9.0
	10.0	9.0

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Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

Hansen Technologies Ltd and Controlled Entities Consolidated Statement of Financial Position As at 30 June 2015

Hansen Technologies Ltd and Controlled Entities Consolidated Statement of Financial Position As at 30 June 2015
Note Current Assets Cash and cash equivalents 7 Receivables 8 Other current assets 9 Total Current Assets Non-Current Assets Plant, equipment & leasehold improvements 10 Intangible assets 11 Deferred tax assets Total Non-Current Assets Total Assets Current Liabilities Payables 12 Borrowings 13 Current tax payable Provisions 14 Unearned income Total Current Liabilities Non-Current Liabilities Deferred tax liabilities Borrowings 13 Provisions 14 Total Non-Current Liabilities Total Liabilities Net Assets Equity Share capital 15 Foreign currency translation reserve 16(a) Options granted reserve 16(b) Retained earnings 16(c) Total Equity	Consolidated Entity
	2015	2014
	$'000	$'000
	21,985 19,950 5,202	3,829 14,701 5,309
	47,137	23,839
	7,556 104,103 3,599	4,376 68,774 2,578
	115,258	75,728
	162,395	99,567
	8,005 10,087 3,813 8,862 13,570	5,006 10,055 1,061 6,973 8,133
	44,337	31,228
	4,012 374 143	2,130 - 123
	4,529	2,253
	48,866	33,481
	113,529	66,086
	75,127 7,946 967 29,489	45,126 (2,106) 748 22,318
	113,529	66,086

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Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

Hansen Technologies Ltd and Controlled Entities Consolidated Statement of Changes in Equity For the Year Ended 30 June 2015

Hansen Technologies Ltd and Controlled Entities Consolidated Statement of Changes in Equity For the Year Ended 30 June 2015
Consolidated Entity Note Balance as at 1 July 2014 Profit for the year Movement in carrying value of foreign entities due to currency translation 16(a) Total comprehensive income for the year Transactions with owners in their capacity as owners: Employee share plan 15 Options exercised 15 Employee share options 16(b) Equity issued under dividend reinvestment plan 15 Institutional placement 15 Share purchase plan offer 15 Dividends paid 6 Total transactions with owners in their capacity as owners Balance as at 30 June 2015 15 & 16	Consolidated Entity
	Contributed Equity	Reserves	Retained Earnings	Total Equity
	$'000	$'000	$'000	$'000
	45,126 - -	(1,358) - 10,052	22,318 16,944 -	66,086 16,944 10,052
	-	10,052	16,944	26,996
	155 1,257 - 1,510 14,780 12,299 -	- - 219 - - - -	- - - - - - (9,773)	155 1,257 219 1,510 14,780 12,299 (9,773)
	30,001	219	(9,773)	20,447
	75,127	8,913	29,489	113,529

Consolidated Entity Note Balance as at 1 July 2013 Profit for the year Movement in carrying value of foreign entities due to currency translation 16(a) Total comprehensive income for the year Transactions with owners in their capacity as owners: Employee share plan 15 Options exercised 15 Employee share options 16(b) Equity issued under dividend reinvestment plan 15 Dividends paid 6 Total transactions with owners in their capacity as owners Balance as at 30 June 2014 15 & 16	Consolidated Entity	Consolidated Entity	Consolidated Entity	Consolidated Entity
	Contributed Equity	Reserves	Retained Earnings	Total Equity
	$'000	$'000	$'000	$'000
	43,650 - -	(925) - (658)	17,142 14,801 -	59,867 14,801 (658)
	-	(658)	14,801	14,143
	160 337 - 979 -	- - 225 - -	- - - - (9,625)	160 337 225 979 (9,625)
	1,476	225	(9,625)	(7,924)
	45,126	(1,358)	22,318	66,086

3

Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

Hansen Technologies Ltd and Controlled Entities Consolidated Statement of Cash Flows For the Year Ended 30 June 2015

Hansen Technologies Ltd and Controlled Entities Consolidated Statement of Cash Flows For the Year Ended 30 June 2015
Cash flows from operating activities Receipts from customers Payments to suppliers and employees Interest received Finance costs Income tax paid Net cash provided by operating activities Cash flows from investing activities Payment for acquisition of business Payment for plant and equipment Payment for capitalised development Net cash used in investing activities Cash flows from financing activities Proceeds from share issue Proceeds from options exercised Proceeds from borrowings Payment of borrowings Dividends paid net of dividend re-investment Net cash provided by (used in) financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of the year	Consolidated Entity
	2015	2014
	$'000	$'000
	113,529 (72,336) 60 (234) (4,129)	93,440 (70,314) 149 (58) (4,339)
	36,890	18,878
	(29,900) (3,037) (4,479)	(21,812) (1,244) (3,553)
	(37,416)	(26,609)
	27,436 1,257 24,000 (25,748) (8,262)	160 337 10,055 - (8,645)
	18,683	1,907
	18,155	(5,824)
	3,829	9,653
	21,985	3,829

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Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

Notes to the Financial Statements 30 June 2015

1 Statement of significant accounting policies

The following is a summary of significant accounting policies adopted by the consolidated entity in the preparation and presentation of the financial report. The accounting policies have been consistently applied, unless otherwise stated.

(a) Basis of preparation of the financial report

The preliminary financial statements have been prepared in accordance with the measurement and recognition criteria of Australian Accounting Standards

(b) Principles of consolidation

The consolidated financial statements are those of the consolidated entity, comprising the financial statements of the parent entity, Hansen Technologies Ltd, and of all entities, which the parent controls. The group controls an entity when it is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

The financial statements of subsidiaries are prepared for the same reporting period as the parent entity, using consistent accounting policies. Adjustments are made to bring into line any dissimilar accounting policies, which may exist.

All inter-company balances and transactions, including any unrealised profits or losses have been eliminated on consolidation. Subsidiaries are consolidated from the date that control is established.

(c) Revenue

Revenue from the provision of services to customers is recognised upon delivery of the service to the customer. Maintenance revenue when invoiced in advance is initially recognised as a liability until the service is performed. Accrued revenue is recognised on a percentage of completion basis in order to match revenues against incurred effort and expense.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer and the costs incurred or to be incurred in respect of the transaction can be measured reliably. Risks and rewards of ownership are considered to have passed to the buyer at the time of delivery of the goods to the customer.

Interest revenue is recognised when it becomes receivable on a proportional basis, taking into account the interest rates applicable to the financial assets.

All revenue is stated net of the amount of goods and services tax (GST).

(d) Cash and cash equivalents

Cash and cash equivalents include cash on hand and at banks, short term deposits with an original maturity of six months or less held at call with financial institutions and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the statement of financial position.

(e) Plant, equipment & leasehold improvements Cost and valuation

All classes of plant, equipment and leasehold improvements are stated at cost less depreciation.

Depreciation

The depreciable amounts of all fixed assets are depreciated on a straight-line basis over their estimated useful lives commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements.

The useful lives for each class of assets are:	2015	2014
Plant, equipment & leasehold improvements: Leasedplant and equipment:	2.5 to 12 years 2.5 to 12years	2.5 to 12 years 2.5 to 12years

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Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

(f) Leases

Leases are classified at their inception as either operating or finance leases based on the economic substance of the agreement so as to reflect the risks and benefits incidental to ownership.

Finance Leases

Leases of fixed assets, where substantially all of the risks and benefits incidental to ownership of the asset, but not the legal ownership, are transferred to the consolidated entity are classified as finance leases. Finance leases are capitalised, recording an asset and liability equal to the present value of the minimum lease payments, including any guaranteed residual values. The interest expense is calculated using the interest rate implicit in the lease and is included in finance costs in the statement of comprehensive income.

Leased assets are depreciated on a straight line basis over their estimated useful lives where it is likely the consolidated entity will obtain ownership of the asset, or over the term of the lease. Lease payments are allocated between the reduction of the lease liability and the lease interest expense for the period.

Operating Leases

Lease payments for operating leases are recognised as an expense on a straight line basis over the term of the lease.

(g) Business combinations

A business combination is a transaction or other event in which an acquirer obtains control of one or more businesses and results in the consolidation of the assets and liabilities acquired. Business combinations are accounted for by applying the acquisition method.

The consideration transferred is the sum of the acquisition-date fair values of the assets transferred, equity instruments issued or liabilities incurred by the acquirer to former owners of the acquire. Deferred consideration payable is measured at fair value. Contingent consideration to be transferred by the acquirer is recognised at the acquisition-date fair value.

Goodwill is recognised initially at the excess over the aggregate of the consideration transferred, the fair value of the non-controlling interest, less the fair value of the identifiable assets acquired and liabilities assumed.

Acquisition related costs are expensed as incurred.

(h) Intangibles

Goodwill

Goodwill is initially measured as described in Note 1(g).

Goodwill is not amortised but is tested annually for impairment, or more frequently if events or changes in circumstances indicate that it might be impaired. Goodwill is carried at cost less accumulated impairment losses.

Technology, Trademarks and Customer Contracts

Technology, trademarks and customer contracts are recognised at cost and are amortised over their estimated useful lives, which range from the term of the contract or 5 to 10 years. Technology, trademarks and customer contracts are carried at cost less accumulated amortisation and any impairment losses.

Research and Development

Expenditure on research activities is recognised as an expense when incurred.

Expenditure on development activities is capitalised only when technical feasibility studies demonstrate that the project will deliver future economic benefits and these benefits can be measured reliably. Capitalised development expenditure is stated at cost less accumulated amortisation. Amortisation is calculated using a straightline method to allocate the cost of the intangible asset over a five year period (or earlier if the development project is abandoned), commencing when the intangible asset is available for use.

Other development expenditure is recognised as an expense when incurred.

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Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

(i) Impairment

Assets with an indefinite useful life are not amortised but are tested at least annually for impairment in accordance with AASB 136. Assets subject to annual depreciation or amortisation are reviewed for impairment whenever events or circumstances arise that indicate that the carrying amount of the asset may be impaired. An impairment loss is recognised where the carrying amount of the asset exceeds its recoverable amount. The recoverable amount of an asset is defined as the higher of its fair value less costs to sell and value in use.

(j) Income tax

Current income tax expense or revenue is the tax payable on the current period’s taxable income based on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities.

Deferred tax balances

Deferred tax assets and liabilities are recognised for temporary differences at the applicable tax rates when the assets are expected to be recovered or liabilities settled. No deferred tax asset or liability is recognised in relation to temporary differences if they arose in a transaction, other than a business combination, that at the time of the transaction did not affect either accounting profit or taxable profit or loss.

Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity.

Tax Consolidation

The parent entity and all eligible Australian controlled entities have formed an income tax consolidated group under the tax consolidation legislation. The tax consolidated group has entered a tax funding agreement whereby each entity in the tax-consolidated group recognises the assets, liabilities, expenses and revenues in relation to its own transactions, events and balances only. This means that:

• the parent entity recognises all current and deferred tax amounts relating to its own transactions, events and balances only;

• the subsidiaries recognise current or deferred tax amounts arising in respect of their own transactions, events and balances;

• the current tax liabilities and deferred tax assets arising in respect of tax losses, are transferred from the subsidiary to the head entity as inter-company payables or receivables.

The tax consolidated group also has a tax sharing agreement in place to limit the liability of subsidiaries in the tax consolidated group arising under the joint and several liability requirements of the tax consolidation system, in the event of default by the parent entity to meet its payment obligations. This means that under the tax sharing agreement, the subsidiaries are legally liable to the income tax payable in proportion to their contribution to the net profit before tax of the tax consolidated group.

(k) Provisions

Provisions are recognised when the consolidated entity has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.

(l) Employee benefits

(i) Short-term employee benefit obligations

Liabilities arising in respect of wages and salaries, annual leave, long service leave and any other employee benefits expected to be settled within twelve months of the reporting date are measured at the amounts based on remuneration rates which are expected to be paid when the liability is settled. The expected cost of short-term employee benefits in the form of compensated absences such as annual leave and long service leave is recognised in the provision for employee benefits. All other short term employee benefit obligations are presented as payables.

(ii) Long-term employee benefit obligations

The provision for employee benefits in respect of annual leave and long service leave which is not expected to be settled within twelve months of the reporting date is measured at the present value of the estimated future cash outflow to be made in respect of services provided by employees up to the reporting date.

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Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

(iii) Retirement benefit obligations

Defined contribution superannuation plan

The consolidated entity makes contributions to defined superannuation plans in respect of employee services rendered during the year. These superannuation contributions are recognised as an expense in the same period when the employee services are received.

(iv) Share-based payments

The consolidated entity operates share-based payment employee share and option schemes. The fair value of the equity to which employees become entitled is measured at grant date and recognised as an expense over the vesting period, with a corresponding increase to an equity account. The fair value of shares is measured at the market bid price at grant date. In respect of share-based payments that are dependent on the satisfaction of performance conditions, the number of shares and options expected to vest is reviewed and adjusted at each reporting date. The amount recognised for services received as consideration for these equity instruments granted is adjusted to reflect the best estimate of the number of equity instruments that eventually vest.

(v) Bonus plan

The consolidated entity recognises a provision when a bonus is payable in accordance with the employee's contract of employment or review letter and the amount can be reliably measured.

(vi) Termination benefits

Termination benefits are payable when employment of an employee or group of employees is terminated before the normal retirement date.

The consolidated entity recognises a provision for termination benefits when the entity can no longer withdraw the offer of those benefits, or if earlier, when the termination benefits are included in a formal restructuring plan that has been announced to those affected by it.

(m) Borrowing costs

Borrowing costs can include interest expense calculated using the effective interest method, finance charges in respect of finance leases. Borrowing costs are expensed as incurred except for borrowing costs incurred as part of the construction of a qualifying asset which are capitalised until the asset is ready for its intended use or sale.

(n) Financial instruments

Classification

The consolidated entity classifies its financial instruments in the following categories: loans and receivables and financial liabilities. The classification depends on the purpose for which the instruments were acquired. Management determines the classification of its financial instruments at initial recognition.

Non-derivative financial instruments

Non-derivative financial instruments consist of investments in equity and debt securities, trade and other receivables, cash and cash equivalents, loans and borrowings, and trade and other payables.

Non-derivative financial instruments are initially recognised at fair value, plus directly attributable transaction costs (if any), except for instruments recorded at fair value through profit or loss. After initial recognition, non-derivative financial instruments are measured as described below

Loans and Receivables

Loans and receivables are measured at fair value at inception and subsequently at amortised cost using the effective interest rate method.

Financial Liabilities

Financial liabilities include trade payables, other creditors and loans from third parties. Financial liabilities are classified as current liabilities unless the consolidated entity has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

(o) Foreign currencies translations and balances

Functional and presentation currency

The financial statements of each entity within the consolidated group are measured using the currency of the primary economic environment in which that entity operates. The consolidated financial statements are presented in Australian dollars which is the consolidated entity’s functional and presentation currency.

Transactions and Balances

Transactions in foreign currencies of entities within the consolidated group are translated into functional currency at the rate of exchange ruling at the date of the transaction.

Foreign currency monetary items that are outstanding at the reporting date (other than monetary items arising under foreign currency contracts where the exchange rate for that monetary item is fixed in the contract) are translated using the spot rate at the end of the financial year.

All resulting exchange differences arising on settlement or re-statement are recognised as revenues and expenses for the financial year.

Entities that have a functional currency different to the presentation currency are translated as follows:

• Assets and liabilities are translated at year-end exchange rates prevailing at that reporting date;

• Income and expenses are translated at actual exchange rates or average exchange rates for the period, where appropriate; and

• All resulting exchange differences are recognised as a separate component of equity.

Exchange differences arising on translation of foreign operations are transferred directly to the group's foreign currency translation reserve as a separate component of equity in the balance sheet.

Exchange differences arising on the reduction of a foreign subsidiary's equity, continues to be recognised in the group's foreign currency translation reserve until such time that the foreign subsidiary is disposed of.

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Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

(p) Goods and services tax (GST)

Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Tax Office. In these circumstances the GST is recognised as part of the acquisition of the asset or as part of an item of the expense. Receivables and payables in the statement of financial position are shown inclusive of GST.

Cashflows are presented in the statement of cashflows on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cashflows.

(q) Comparatives

Where necessary, comparative information has been reclassified and repositioned for consistency with current year disclosures.

(r) Rounding amounts

The parent entity and the consolidated entity have applied the relief available under ASIC Class Order CO 98/0100 and accordingly, amounts in the consolidated financial statements and the directors' report have been rounded off to the nearest thousand dollars, or in certain cases, to the nearest dollar.

• (s) Adoption of new and amended accounting standards that are first operative at 30 June 2015

There are no new or amended accounting standards effective for the financial year beginning 1 July 2014 affected any amounts recorded in the current or prior year.

(t) Accounting standards and interpretations issued but not operative at 30 June 2015

The following standards and interpretations have been issued at the reporting date but are not yet effective. The directors’ assessment of the impact of these standards and interpretations is set out below.

(i) AASB 15 Revenue from contracts with customers. AASB 15 introduces a five step process for revenue recognition with the core principle being for entities to recognise revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration (that is, payment) to which the entity expects to be entitled in exchange for those goods or services. The five step approach is as follows:

• Step 1: Identify the contracts with the customer;

• Step 2: Identify the separate performance obligations;

• Step 3: Determine the transaction price;

• Step 4: Allocate the transaction price; and

• Step 5: Recognise revenue when a performance obligation is satisfied.

AASB 15 will also result in enhanced disclosures about revenue, provide guidance for transactions that were not previously addressed comprehensively (for example, service revenue and contract modifications) and improve guidance for multipleelement arrangements.

The effective date is annual reporting periods beginning on or after 1 January 2017.

The changes in revenue recognition requirements in AASB 15 may cause changes to the timing and amount of revenue recorded in the financial statements as well as additional disclosures. The impact if any of AASB 15 has not yet been quantified.

(ii) AASB 9 Financial Instruments

Significant revisions to the classification and measurement of financial assets, reducing the number of categories and simplifying the measurement choices, including the removal of impairment testing of assets measured at fair value. The amortised cost model is available for debt assets meeting both business model and cash flow characteristics tests. All investments in equity instruments using AASB 9 are to be measured at fair value.

Amends measurement rules for financial liabilities that the entity elects to measure at fair value through profit and loss. Changes in fair value attributable to changes in the entity’s own credit risk are presented in other comprehensive income.

Impairment of assets is now based on expected losses in AASB 9 which requires entities to measure:

• the 12-month expected credit losses (expected credit losses that result from those default events on the financial instrument that are possible within 12 months after the reporting date); or

• full lifetime expected credit losses (expected credit losses that result from all possible default events over the life of the financial instrument.

The effective date is annual reporting periods beginning on or after 1 January 2018.

Other standards and interpretations have been issued at the reporting date but are not yet effective. When adopted, these standards and interpretations are likely to impact on the financial information presented, however the assessment of impact has not yet been completed.

9

Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

2 Critical accounting estimates and judgements

The group makes certain estimates and assumptions concerning the future which, by definition, will seldom represent actual results. Estimates and assumptions based on future events have a significant inherent risk and where future events are not as anticipated there could be a material impact on the carrying amounts of the assets and liabilities discussed below.

(a) Impairment of goodwill

The intangible asset of goodwill is subject to periodic review to assess if its carrying value has been impaired. This assessment compares the carrying book value with the recoverable amount of these assets using value in-use discounted cash low projection calculations based on management's determination of budgeted cash flow projections and gross margins, past performance and its expectations for the future. The valuation utilises the billing business segment of the Board approved budget for the subsequent fiscal year (being the business segment to which goodwill applies) and; - provides for a constant 5% growth rate (2014: 3%) for the remainder of the forecast period, and

• utilises a 12% (2014:14.5%) weighted cost of capital discount rate, to

• determine the discounted value of the resultant cash flow over a five year period, plus terminal value using a terminal growth rate of 2% (2014: 3%) at period end.

• (b) Impairment of non-financial assets other than goodwill

All assets are assessed for impairment at each reporting date by evaluating whether indicators of impairment exist in relation to the continued use of the asset by the consolidated entity. Impairment triggers include declining product or manufacturing performance, technology changes, adverse changes in the economic or political environment or future product expectations. If an indicator of impairment exists the recoverable amount of the asset is determined.

• (c) Income tax

Income tax benefits are based on the assumption that no adverse change will occur in the income tax legislation and the anticipation that the group will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law.

Recognition of carried forward losses is based upon the probable future profits of the group.

3 Foreign currency translations and balances

Exchange differences arising on translation of the foreign controlled entities are recognised in other comprehensive income and accumulated in a separate reserve within equity. On consolidation, exchange differences arising from the translation of any net investment in foreign entities are recognised in other comprehensive income. When a foreign operation is sold or any borrowings forming part of the net investment are repaid, the associated exchange differences are reclassified to profit or loss as part of the gain or loss on sale.

4 Revenue and other income

Revenues from continuing operations Revenue from sale of goods and services Other income: From operating activities Interest received Net foreign exchange gains Other income Total other income Total revenue and other income from continuing operations	Consolidated Entity	Consolidated Entity
	2015	2014
	$'000	$'000
	106,257	86,021
	106,257	86,021
	60 203 212	149 43 244
	475	436
	106,732	86,457

10

Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

5 Profit from continuing operations

Note Profit from continuing operations before income tax has been determined after the following specific expenses: Employee benefit expenses Wages and salaries Superannuation costs Share based payments Total employee benefit expenses Depreciation of non-current assets Plant, equipment & leasehold improvements 10 Total depreciation of non-current assets Amortisation of non-current assets Technology, trademarks & customer contracts 11 Research and development 11 Total amortisation of non-current assets Property and operating rental expenses Rental charges Total property and operating rental expenses Finance Charges Finance Costs Total Finance Costs	Consolidated Entity	Consolidated Entity
	2015	2014
	$'000	$'000
	51,142 3,934 219	43,016 3,184 225
	55,295	46,425
	1,863	1,588
	1,863	1,588
	3,082 2,131	1,627 1,503
	5,213	3,130
	4,575	3,993
	4,575	3,993
	234	58
	234	58

11

Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

6 Dividends

2015

A 3 cent per share partially franked final dividend was announced to the market on 27 August 2015. The amount declared has not been recognised as a liability in the accounts of Hansen Technologies Ltd as at 30 June 2015.

• Dividends provided for or paid during the year - 3 cent per share final dividend paid 30 September 2014 - 3 cent per share final dividend paid 30 September 2013

• 3 cent per share interim dividend paid 27 March 2015 - 3 cent per share interim dividend paid 28 March 2014

Proposed dividend not recognised at the end of the year.

Dividend franking account

30% franking credits, on a tax paid basis, are available to shareholders of Hansen Technologies Ltd for subsequent financial years.

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Consolidated Entity
2015 2014
$'000 $'000
4,874
4,807
4,899
4,818
9,773 9,625
5,301 4,874
2,473 1,879
----- End of picture text -----

The above available amounts are based on the balance of the dividend franking account at year-end adjusted for:

• a) franking credits that will arise from the payment of any current tax liability; b) franking debits that will arise from the payment of any dividends recognised as a liability at year-end;

• c) franking credits that will arise from the receipt of any dividends recognised as receivables at year-end;

• d) franking credits that the entity may be prevented from distributing in subsequent years.

• The ability to utilise the franking credits is dependent upon there being sufficient available profits to declare dividends.

7 Cash and cash equivalents Current Cash at bank and on hand Interest bearing deposits 8 Receivables Current Trade receivables Less: provision for impairment Sundry debtors Trade and other receivables ageing analysis at 30 June: Not past due Past due 31-60 days Past due 61-90 days Past due more than 91 days	2015 2014 $'000 $'000 5,718 2,828 16,267 1,001 21,985 3,829 2015 2014 $'000 $'000 19,578 13,516 (470) (317) 19,108 13,199 842 1,502 19,950 14,701 Consolidated Entity Consolidated Entity	2015 2014 $'000 $'000 5,718 2,828 16,267 1,001 21,985 3,829 2015 2014 $'000 $'000 19,578 13,516 (470) (317) 19,108 13,199 842 1,502 19,950 14,701 Consolidated Entity Consolidated Entity	2015 2014 $'000 $'000 5,718 2,828 16,267 1,001 21,985 3,829 2015 2014 $'000 $'000 19,578 13,516 (470) (317) 19,108 13,199 842 1,502 19,950 14,701 Consolidated Entity Consolidated Entity	2015 2014 $'000 $'000 5,718 2,828 16,267 1,001 21,985 3,829 2015 2014 $'000 $'000 19,578 13,516 (470) (317) 19,108 13,199 842 1,502 19,950 14,701 Consolidated Entity Consolidated Entity
	Gross	Impairment	Gross	Impairment
	2015	2015	2014	2014
	$'000	$'000	$'000	$'000
	15,708 1,350 1,072 1,448	- - - 470	10,162 1,739 800 815	- - - 317
	19,578	470	13,516	317

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Not past due
Past due 31-60 days
Past due 61-90 days
Past due more than 91 days
The entity expects to collect all debtor amounts where no provision for impairment
has been recorded.
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9 Other current assets

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Consolidated Entity
2015 2014
$'000 $'000
Current
Prepayments 1,990 1,517
Other receivables 38 -
Accrued revenue 3,174 3,792
5,202 5,309
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12

Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

10 Plant, equipment & leasehold improvements

Plant, equipment & leasehold improvements at cost Accumulated depreciation Total plant, equipment & leasehold improvements

Consolidated Entity	Consolidated Entity
2015	2014
$'000	$'000
32,111 (24,555)	25,711 (21,335)
7,556	4,376

Reconciliation

Reconciliation
Reconciliation of the carrying amounts of plant, equipment & leasehold improvements at the beginning and end of the current financial year. Plant, equipment & leasehold improvements Carrying amount at 1 July Additions Acquired Disposals Depreciation expense Net foreign currency movements arising from foreign operations Carrying amount at 30 June	Consolidated Entity
	2015	2014
	$'000	$'000
	4,376 3,037 1,960 (19) (1,863) 65	4,699 1,244 9 (23) (1,588) 35
	7,556	4,376

11 Intangible assets

Goodwill at cost Accumulated amortisation & impairment Technology, trademarks & customer contracts at cost Accumulated amortisation & impairment Software development at cost Accumulated amortisation Total intangible assets Reconciliation of goodwill at cost Carrying amount at 1 July Increase due to acquisition Net foreign currency movements arising from foreign operations Carrying amount at 30 June Accumulated amortisation & impairment at beginning of year Net foreign currency movements arising from foreign operations Accumulated amortisation & impairment at end of year Reconciliation of technology, trademarks & customer contracts at cost Carrying amount at 1 July Increase due to acquisition Net foreign currency movements arising from foreign operations Carrying amount at 30 June Accumulated amortisation & impairment at beginning of year Amortisation of technology, trademarks & customer contracts Net foreign currency movements arising from foreign operations Accumulated amortisation & impairment at end of year	Consolidated Entity	Consolidated Entity
	2015	2014
	$'000	$'000
	81,888 (1,454)	54,944 (1,433)
	80,434	53,511
	21,740 (7,487)	12,377 (3,764)
	14,253	8,613
	29,574 (20,158)	28,627 (21,977)
	9,416	6,650
	104,103	68,774
	54,944 20,062 6,882	37,408 18,056 (520)
	81,888	54,944
	(1,433) (21)	(1,418) (15)
	(1,454)	(1,433)
	12,377 7,091 2,272	7,177 5,390 (190)
	21,740	12,377
	(3,764) (3,082) (641)	(2,170) (1,627) 33
	(7,487)	(3,764)

Reconciliation of software development at cost Carrying amount at 1 July Expenditure capitalised in current period Fully amortised write back Net foreign currency movements arising from foreign operations Carrying amount at 30 June Accumulated amortisation at beginning of year Current year charge Fully amortised write back Net foreign currency movements arising from foreign operations Accumulated amortisation at end of year	Consolidated Entity	Consolidated Entity
	2015	2014
	$'000	$'000
	28,627 4,479 (3,994) 462	29,705 3,553 (4,574) (57)
	29,574	28,627
	(21,977) (2,131) 3,994 (44)	(25,048) (1,503) 4,574 -
	(20,158)	(21,977)

13

Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

12 Payables

Current Trade payables Other payables

Consolidated Entity	Consolidated Entity
2015	2014
$'000	$'000
1,885 6,120	1,394 3,612
8,005	5,006

Included in other payables is a liability for contingent consideration expected to be paid in relation to a business combination dated 1st May 2015.

13 Borrowings

Borrowings
Current Secured Term facility Lease liability Non-current Secured Lease liability	Consolid	ated Entity
	2015	2014
	$'000	$'000
	10,000 87	10,055 -
	10,087	10,055
	374	-
	374	-

The Company has a secured A$30 million multicurrency 3 year term facility with its external bankers to provide additional funding as required for acquisitions and general corporate purposes.

The facility is secured by 90% of group assets . As at 30 June 2015 the remaining unutilised portion of the facility is A$20 Million. Subsequent to balance date the amount outstanding was repaid in full.

The Company has a lease liability relating to IT equipment due for repayment in full by January 2020.

14 Provisions

Current Employee benefits Onerous lease Other Non-current Employee benefits (a) Aggregate employee benefits liability (b) Number of employees at year end Reconciliations Movements in provisions other than employee benefits: Provisions Onerous Lease - current Carrying amount at beginning of year Net provisions (payments) made during the year Carrying amount at end of year Other - current Carrying amount at beginning of year Net provisions (payments) made during the year Carrying amount at end of year	Consolidated Entity	Consolidated Entity
	2015	2014
	$'000	$'000
	8,586 - 276	6,748 130 95
	8,862	6,973
	143	123
	143	123
	8,729	6,871
	544	427
	130 (130)	147 (17)
	-	130
	95 181	85 10
	276	95

14

Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

15 Contributed capital

a) Issued and paid up capital Ordinary shares, fully paid b) Movements in shares on issue Balance at beginning of the financial year Shares issued under dividend reinvestment plan Shares issued under employee share plan Options exercised Institutional placement Share purchase plan offer Balance at end of the financial year	Consolidated Entity	Consolidated Entity	Consolidated Entity	Consolidated Entity
	2015	2014
	$'000	$'000
	75,127	45,126
	Consolidated Entity		Consolidated Entity
	2015	2015	2014	2014
	No of Shares	$'000	No of Shares	$'000
	161,209,642 931,695 65,720 1,345,000 6,966,717 5,676,559	45,126 1,510 155 1,257 14,780 12,299	159,634,602 825,800 134,240 615,000 - -	43,650 979 160 337 - -
	176,195,333	75,127	161,209,642	45,126

16 Reserves and retained earnings

Note Foreign currency translation reserve 16 (a) Options granted reserve 16 (b) Retained earnings 16 (c) (a) Foreign currency translation reserve This reserve is used to record the exchange differences arising on translation of a foreign entity. Movements in reserve Balance at beginning of year Adjustment to carrying value of overseas interests due to currency fluctuation Balance at end of year (b) Options granted reserve This reserve is used to record the fair value of options issued to employees as part of their remuneration. Movements in reserve Balance at beginning of year Value of options granted during the year Balance at end of year (c) Retained earnings Balance at beginning of year Dividends paid during the year Net profit attributable to members of Hansen Technologies Ltd Balance at end of year	Consolidated Entity	Consolidated Entity
	2015	2014
	$'000	$'000
	7,946	(2,106)
	967	748
	29,489	22,318
	(2,106) 10,052	(1,448) (658)
	7,946	(2,106)
	748 219	523 225
	967	748
	22,318 (9,773) 16,944	17,142 (9,625) 14,801
	29,489	22,318

17 Earnings per share

Reconciliation of earnings used in calculating earnings per share: Basic earnings - ordinary shares Diluted earnings - ordinary shares Weighted average number of ordinary shares used in calculating basic earnings per share: Number for basic earnings per share - ordinary shares Number for diluted earnings per share - ordinary shares Basic earnings (cents) per share from continuing operations Total basic earnings (cents) per share Diluted earnings (cents) per share from continuing operations Total diluted earnings (cents) per share	Consolidated Entity	Consolidated Entity
	2015	2014
	$'000	$'000
	16,944	14,801
	16,944	14,801
	2015	2014
	no. shares	no. shares
	164,045,486	160,585,269
	169,374,596	165,742,352
	Centsper share	Centsper share
	10.3	9.2
	10.3 10.0	9.2 9.0
	10.0	9.0

Classification of securities as potential ordinary shares

The securities that have been classified as potential ordinary shares and included in diluted earnings per share only are options outstanding under the Employee Share Option Plan.

15

Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

18 Parent entity information

Summarised presentation of the parent entity, Hansen Technologies Ltd.'s, financial statements: (a) Summarised statement of financial position Assets Current assets Non‑current assets Total assets Liabilities Current liabilities Non‑current liabilities Total liabilities Net assets Equity Share capital Accumulated profits Share based payments reserve Total equity (b) Summarised statement of comprehensive income Profit for the year Total comprehensive income for the year	Parent Entity	Parent Entity
	2015	2014
	$'000	$'000
	68 85,502	127 62,411
	85,570	62,538
	3,773 13	1,999 -
	3,786	1,999
	81,784	60,539
	75,127 5,690 967	45,126 14,665 748
	81,784	60,539
	798	9,001
	798	9,001

(c) Parent entity guarantees

Hansen Technologies Ltd, being the parent entity, has entered into a guarantee in regard to the loan facility (refer note 13), but other than that has not entered into any guarantees in relation to debts of its subsidiaries.

19 Segment Information

a) Description of segments

Inter-segment pricing is determined on an arm's length basis.

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.

Business segments

The consolidated entity comprises the following main business segments, based on the consolidated entity's management reporting system: Billing: Represents the sale of billing applications and the provision of consulting services in regard to billing systems.

IT Outsourcing: Represents the provision of various IT outsourced services covering facilities management, systems and operations support, network services and business continuity support.

Other: Represents software and service provision in superannuation administration.

Geographical segments

In presenting information on the basis of geographical segments, segment revenue is based on the geographical location of customers. Segment assets are based on the geographical location of the assets.

The consolidated entity's business segments operate geographically as follows: APAC: Sales and services throughout Australia and Asia Americas: Sales and services throughout the Americas

EMEA: Sales and services throughout Europe, the Middle East and Africa

b) Segment information

2015 Segment revenue Total segment revenue Segment revenue from external source Segment result Total segment result Segment result from external source Items included within the segment result: Depreciation expense Amortisation expense Total segment assets Additions to non-current assets Total segment liabilities	2015 Financial Year	2015 Financial Year	2015 Financial Year	2015 Financial Year
	Billing	Outsourcing	Other	Total
	$'000	$'000	$'000	$'000
	97,275	6,040	2,942	106,257
	97,275	6,040	2,942	106,257
	21,779	2,858	958	25,595
	21,779	2,858	958	25,595
	1,514 5,213 144,167	84 - 2,655	6 - 1,293	1,604 5,213 148,115
	1,285	631	-	1,916
	32,695	1,606	782	35,082

16

Hansen Technologies Limited and its controlled entities ABN 90 090 996 455

2014 Segment revenue Total segment revenue Segment revenue from external source Segment result Total segment result Segment result from external source Items included within the segment result: Depreciation expense Amortisation expense Total segment assets Additions to non-current assets Total segment liabilities	2014 Financial Year	2014 Financial Year	2014 Financial Year	2014 Financial Year
	Billing	Outsourcing	Other	Total
	$'000	$'000	$'000	$'000
	75,065	7,064	3,892	86,021
	75,065	7,064	3,892	86,021
	17,111	2,914	1,302	21,327
	17,111	2,914	1,302	21,327
	836 3,202 79,121	25 2 2,776	17 - 953	878 3,204 82,850
	923	103	-	1,026
	14,656	1,931	1,064	17,651

i) Reconciliation of segment revenue from external source to the consolidated statement of comprehensive income

Segment revenue from external source Other revenue Interest revenue Total revenue	2015	2014
	$'000	$'000
	106,257 415 60	86,021 287 149
	106,732	86,457

Revenue from external source attributed to geographical segments is detailed as follows:

APAC Americas EMEA Total revenue	2015	2014
	$'000	$'000
	39,068 32,142 35,047	36,033 19,982 30,006
	106,257	86,021

ii) Reconciliation of segment result from the external source to the consolidated statement of comprehensive income

Segment result from external source Interest revenue Interest expense Depreciation & amortisation Other expense Total profit before income tax	2015	2014
	$'000	$'000
	25,595 60 (234) (259) (1,160)	21,327 149 (58) (638) (1,322)
	24,003	19,458

iii) Reconciliation of segment assets to the consolidated statement of financial position

Segment assets Unallocated assets - Cash - Other Total unallocated assets Total assets Assets attributed to individual countries is detailed as follows: APAC Americas EMEA Total assets iv) Reconciliation of segment liabilities to the consolidated statement of financial position Segment liabilities Unallocated liabilities - Bank facility - Other Total unallocated liabilities Total liabilities	2015	2014
	$'000	$'000
	148,115	82,850
	21,985 2,295	13,884 2,833
	24,280	16,717
	172,395	99,567
	2015	2014
	$'000	$'000
	49,401 55,181 43,532	46,185 49,554 3,828
	148,114	99,567
	2015	2014
	$'000	$'000
	35,082	17,651
	10,000 3,784	10,055 5,775
	13,784	15,830
	48,866	33,481

17