INGHAMS GROUP LIMITED — Annual Report 2017

Aug 21, 2017

Inghams Group Limited Inghams Group Limited (ACN: 162 709 506) and its controlled entities Appendix 4E for the year [53 weeks] ended 1 July 2017 (FY17)

ended 1 July 2017	(FY17)
Results for announcement to the	market
	FY17* \$'000	FY16 \$'000	Variance \$'000	Variance %
Revenue from ordinary activities	2,426,900	2,308,700	118,200	5.1
Profit from ordinary activities attributable to members	59,100	25,200	33,900	134.5
Net profit for the period attributable to members	59,100	25,200	33,900	134.5
Dividends
The directors have determined that a fully franked final declared at 1 July 2017 and as such no provision has dividend is 13 September 2017.	dividend of 9.5 cents been recognised. The record	per share be date for	declared. The determining entitlements	dividend was not to the
An interim dividend of 2.6 cents per share was declared	and paid.
Explanatory note on results
For further information refer 'Operating and Financial	Review' section within the	attached	Directors' Report.
* FY17 represents 53 weeks ending 1 July 2017, ended 25 June 2016.	with the previous corresponding	period	FY16 representing	52 weeks
Net tangible assets backing
At 1 July 2017, the net tangible asset backing per ordinary	share was \$0.58 per	share (25 June	2016: \$0.00 per	share).
Entities where control has been gained or	lost
There were no entities acquired or disposed of during	the current period or the	previous	corresponding period.

Dividends

Entities where control has been gained or lost There were no entities acquired or disposed of during the current period or the previous corresponding period.

The Group has a 50% (FY16: 50%) investment in AFB International Pty Limited (AFB). The Group's share of AFB's results is not material to the Group's results for the current period or for the previous corresponding period. Annual General Meeting The annual general meeting will be held at Rydges Hotel, North Sydney NSW 2060 on 31 October 2017 commencing at

Associates

The approximate date the Annual Report will be available is 29 September 2017. This Appendix 4E should be read in conjunction with the Inghams Group Limited Financial Report for the year ended 1 July Inghams Group Limited | Appendix 4E 1

10am.

2017.

Inghams Group Limited (formerly Ingham Holdings I Pty Limited) ACN 162 709 506 Financial Report For the year ended 1 July 2017

Contents to financial report
Directors' report	4
Auditor independence declaration	43
Financial statements
Consolidated income statement	44
Consolidated statement of comprehensive income	45
Consolidated statement of financial position Consolidated statement of changes in equity	46 47
Consolidated statement of cash flows	48
Notes to the consolidated financial statements	49
Directors' declaration	95
Independent auditor's report to the members	96

Corporate information

Directors

ACN 162 709 506 Peter Bush Mick McMahon Linda Bardo Nicholls, AO Simon Harle Ricky Lau Helen Nash Kevin McBain Bernard Brookes Company Secretary Ian Brannan David Matthews Registered office and principle place of business Level 4 1 Julius Avenue North Ryde NSW 2113 Tel: 02 9826 4444 Website: www.inghams.com.au

Australia

Auditors KPMG

Directors' report This audited general purpose financial report for the year ended 1 July 2017 covers the consolidated entity (The Group) comprising Inghams Group Limited (Ingham's, the Company) (ACN 162 709 506) and its controlled entities. The Group's functional and presentation currency is Australian dollars (\$), rounded to the nearest hundred thousand.

Directors

comprising Inghams Group Limited functional and presentation currency	(Ingham's, the Company) (ACN is Australian dollars (\$), rounded	162 709 506) and its controlled entities. The Group's to the nearest hundred thousand.
Directors
The following persons were directors and until the date of this report:	of Inghams Group Limited	(formerly Ingham Holdings I Pty Limited) during the period
Director Peter Bush Mick McMahon Linda Bardo Nicholls, AO Simon Harle Ricky Lau Helen Nash Kevin McBain	Date of appointment 7 October 2016 6 March 2015 7 October 2016 7 October 2016 29 October 2013 16 May 2017 27 June 2013	Date of resignation space 7 October 2016
Bernard Brookes	29 October 2013	7 October 2016
Present director profiles of Inghams Peter Bush (Chairman)
Peter had a long and successful Reckitt and Coleman, Ampol/Caltex strategic consultancy business for Advertising and McDonald's Australia. Cross Media Group (since 2014) Chairman of Pacific Brands, Nine	career in fast-moving consumer and Arnott's and was CEO of six years with clients including In 2003, he became the CEO and Executive Chairman of Southern Entertainment Co and NEC Holdings	goods (FMCG), holding senior roles with SC Johnson, AGB McNair and Schwarzkopf. He then ran his own Qantas, Telstra, George Patterson Bates, John Singleton of McDonald's Australia. Peter is Chairman of Southern Cross Media Group (since 2015) and was previously and a director of Insurance Australia Group.
Mick McMahon (Executive Director)
Mick joined Ingham's in January has more than 30 years' operational member of Skilled Group. He served Coles Supermarkets Australia from and overseas. Mick is also Chairman	2015 as Executive Chairman and management experience. He as COO at Coles Supermarkets 2005 to 2009. Prior to Coles, he of Red Rock Leisure, a private	was subsequently appointed CEO in February 2016. Mick is the former Managing Director, CEO and a board Australia from 2007 to 2009 and Managing Director of spent 19 years with Royal Dutch Shell both in Australia Australian tourism and entertainment venue operator.
Linda Bardo Nicholls, AO (Non-executive	director)
Linda has more than 30 years'	experience as a senior executive and	director in banking, insurance and funds management

Coles Supermarkets Australia from 2005 to 2009. Prior to Coles, he spent 19 years with Royal Dutch Shell both in Australia and overseas. Mick is also Chairman of Red Rock Leisure, a private Australian tourism and entertainment venue operator. Linda Bardo Nicholls, AO (Non-executive director) Linda has more than 30 years' experience as a senior executive and director in banking, insurance and funds management in Australia, New Zealand and United States. She is a Chairman of Japara Healthcare and a director of Fairfax Media, Medibank Private, the Olivia Newton John Cancer Research Institute and is a Member of the Museums Board of Victoria. Linda was previously Chairman of Healthscope, Chairman of Australia Post, Chairman of Keolis Downer (trading as Yarra Trams) and a director of Pacific Brands, Sigma Pharmaceuticals and St George Bank.

Directors

Directors' report Simon Harle (Non-executive director) Simon is a former Partner of TPG based in Melbourne. Prior to joining TPG in 2006, he worked for Credit Suisse in the Investment Banking Division, where he advised on numerous Australia and New Zealand mergers, acquisitions and debt and equity financings. Prior to that, he was with Arthur Andersen Corporate Finance based in Melbourne and London, where he qualified as a chartered accountant. He has played a key role in a number of TPG investments, including Healthscope, Alinta and the Cushman & Wakefield transactions.

Ricky Lau (Non-executive director) Ricky is partner of TPG based in Hong Kong. Since joining TPG in 1998, Ricky has played a key role in TPG's investments in China and has served or serves on the board of directors of Shenzhen Development Bank, China Grand Automotive Services Co. Ltd., Daphne International and Phoenix Satellite Television. Prior to joining TPG, he was responsible for the corporate and project finance division of Hopewell Holdings, a regional infrastructure project developer. Ricky received an Executive Master of Business Administration from Kellogg-HKUST and an undergraduate degree from the University of British Columbia. Ricky is also a CFA charter holder. Helen Nash (Non-executive director) Helen has more than 20 years' brand and marketing experience including a number of senior executive roles with McDonald's Australia and a variety of marketing and FMCG roles in Australia and internationally with IPC Media and Procter & Gamble. Helen is also a non-executive director of Blackmores, Southern Cross Media and Metcash, and a former non-executive director of Pacific Brands. Directors' meetings The number of meetings of directors (including meetings of Board Committees) held during the year and the number of meetings attended by each director, during their time in office, were as follows:

Directors' meetings
The number of meetings meetings attended by each	of directors (including director, during	meetings of their time in	Board Committees) office, were as follows:	held during	the year and the	number of
	Directors' meeting held	Directors' meetings attended	Audit & risk committee meetings held	Audit & risk committee meetings attended	People & remuneration committee meetings held	People & remuneration committee meetings attended
Peter Bush Mick McMahon	10 (c) 10	9 10	1	1	1	1
Linda Bardo Nicholls, AO	10	8 *	1 (c)	0 *	1	1
Simon Harle	10	10	1	1	1	1
Ricky Lau Helen Nash	10 3	9 3	-	-	1 (c)	1
Kevin McBain	0 **	-
Bernard Brookes	0 **	-
Notes (c) Designates the chairman Non-attendance due * Directors resigned	of the committee to illness prior to listing
The nomination committee,	of which Peter	Bush is the Chair,	did not meet	during the year.

6

Directors' report Company Secretaries Ian Brannan, ACMA, MBA Ian joined Ingham's in May 2015 as Chief Financial Officer. Ian has 25 years' senior management experience in public and private companies in Australia, the US and the UK. He has held senior finance roles with Sara lee Bakery, Arnott's Biscuits, Campbell Soup and Carter Holt Harvey Building Supplies Group and most recently was CFO for GWA Group Limited. Ian serves as secretary and director on a number of Ingham's companies, holds a MBA from Warwick Business School and is an Associate of the Chartered Institute of Management Accountants (ACMA).

David Matthews, BEc, LL.B. David has 30 years' experience as a lawyer with international law firms in Australia and the UK and with large, listed global companies. Prior to joining Ingham's he was General Counsel and Company Secretary of Fonterra Co-operative Group, Telecom New Zealand's Australian operations, and Arnott's Biscuits / Campbell Soup in the Asia Pacific Region. He has a Bachelor of Economics (BEc) and Bachelor of Laws (LL.B.) from the University of Sydney and is a member of the Law Society of NSW and of the Australian Institute of Company Directors. Corporate Structure Ingham's is a company limited by shares that is incorporated and domiciled in Australia. Details of all companies in the Group are outlined in Note 22 to the Financial Statements. Principal activities The principal activities of the Group during the year consisted of the production and sale of chicken and turkey products across its vertically integrated primary, free range, value enhanced, further processed and ingredient categories. Additionally stockfeed is produced primarily for internal use but also for the poultry, pig, dairy and equine industries. An interim dividend of 2.6 cents per share totalling \$9.9 million was paid on 5 April 2017 (2016: \$nil). Subsequent to the year end a dividend of 9.5 cents per share has been declared totalling \$36.1 million to be paid on 4 October 2017. The financial effect of this dividend has not been brought to account in these consolidated financial statements and will be recognised in subsequent financial reports. There are no income tax consequences associated with this dividend.

Dividends

Directors' report Significant changes in the state of affairs On 7 November 2016, the Group undertook an Initial Public Offering (IPO) on the Australian Securities Exchange. The purpose of the IPO was to: • Provide the Group with access to capital markets to pursue further growth opportunities; • Reduce and restructure the Group's existing debt obligations; and As a result of the IPO, the Group:

• Allow existing shareholders to realise part of their investment. • Issued new shares realising proceeds of \$156.2 million; • Expensed IPO related transaction costs of \$28.0 million; • Repaid existing debt facilities and loans of \$573.5 million and subsequently drew down \$450 million of unsecured borrowings under a new syndicated bank facility;

• Incurred \$4.2 million of remaining expense in respect of pre-IPO Long Term Incentive Plan (LTIP); and • Expensed capitalised borrowing costs of \$6.5 million. Significant events after the balance date Subsequent to the year end a dividend of 9.5 cents per share has been declared totalling \$36.1 million to be paid on 4 October 2017. The financial effect of this dividend has not been brought to account in these consolidated financial statements and will be recognised in subsequent financial reports. Other than the matter discussed above, there has not been any matter or circumstance that has arisen since the end of the reporting period that has significantly affected, or may significantly affect, the operations of the Group, the results of the

operations or the state of affairs of the Group in future reporting periods. Environmental regulation

The Group is subject to particular and significant environmental regulations. All relevant authorities have been provided with regular updates, and to the best of the directors' knowledge all activities have been undertaken in compliance with or in accordance with a process agreed with the relevant authority. Ingham's takes its environmental obligations seriously and has had an environmental policy in place for more than 30 years. The policy provides the framework for a comprehensive management strategy that is integrated with overall business strategy and ensures individual sites are managed in a consistent way to a high standard. In the past decade, sustainability has become a focus for the organisation and is a key business objective, helping identify business improvements and further efficiencies. Ingham's is now recognised as a leader in sustainability and aims to led the world in the continued adoption of advanced water treatment to reduce water use. The policy contains a commitment to protecting the environment including: • Development of an environmental management system integral to overall management; • Prevention of pollution; • Product stewardship; • Water, energy and material conservation; • Continuous environmental improvement; and • Working towards sustainability internally and with the supply chain.

8

Directors' report Environmental regulation (continued) It includes requirements for each site to develop and implement a site specific environmental management plan with the following objectives: • Compliance with applicable legal and other requirements met; • Identification of environmental impacts of our activities, products and services; • Procedures for managing activities with a potential to impact the environment; • Continuous environmental improvement through setting and reviewing specific objectives and targets; and • Clear responsibilities and accountability. It also outlines the annual self-assessment and the periodic independent environmental review processes. Each site has the required environmental protection licence or resource consent and completes an annual statement of

Ingham's is subject to the National Greenhouse and Energy Reporting Act 1997 and is required to report on the energy consumption and greenhouse gas emissions of its Australian operations. Directors' interests

compliance.
Ingham's is subject to the National Greenhouse and Energy Reporting Act 1997 and is required to report on the energy consumption and greenhouse gas emissions of its Australian operations.
Directors' interests
The relevant interest of each director in the shares and rights over such instruments issued by the companies within Group, as notified by the directors to the ASX in accordance with s250G(1) of the Corporations Act 2001, at the date of report is as follows:
Ordinary Performance shares rights
Peter Bush 158,730 Mick McMahon 3,360,532 476,190 Linda Bardo Nicholls, AO 15,873

Directors' report Share options Select employees of the Group have been granted an interest-free loan to subscribe to shares of Inghams Group Limited. This loan is non-recourse other than to the shares held by that employee, and the proceeds of the loan must be used to buy shares. The arrangement has been accounted for as share options. These options entitle the holders to receive dividends on ordinary shares of the Company, and these dividends are required to be used to repay the loans attached. Shares under this scheme are held in trust for employees by a subsidiary, Ingham 2 Pty Limited. All options under this scheme vested upon completion of the IPO during the year, and remain held in trust, escrowed from sale until July 2018. Performance rights During the year a new long term incentive program, the Inghams Group Limited Equity Incentive Plan, has been issued to key management personnel and select other employees of the Group. Under this Plan, performance rights have been issued to individuals. These rights have a 3 year term and vest subject to performance conditions assessed based on Earnings Per Share (EPS) and Total Shareholder Return (TSR), in addition to having continued employment conditions Share options/rights outstanding at the end of the year have the following expiry dates and exercise prices (where

Name of officer	Date granted	Number of rights
Mick McMahon	7 November 2016	476.190
lan Brannan	7 November 2016	238,095
Janelle Cashin	7 November 2016	79,365
Quinton Hildebrand	7 November 2016	79,365
Jonathan Gray	7 November 2016	79,365
Adrian Revell	7 November 2016	79,365

Directors' report Share options (continued) Shares issued as a result of the exercise of options During the year 21,879,394 shares previously issued have vested and 13,640,853 of these have been exercised in the year

Indemnities

from share options, and remain held in trust by Ingham 2 Pty Limited. Indemnities and insurance of officers and auditors Ingham's constitution indemnifies each officer of Ingham's and its controlled entities against a liability incurred by that person as an officer unless that liability arises out of conduct involving a lack of good faith. The constitution also provides that Ingham's may make a payment to an officer or employee (by way of advance, loan or otherwise) for legal costs incurred by them in defending legal proceedings in their capacity as an officer or employee. Ingham's has entered into a Deed of Access, Indemnity and Insurance with each director which applies during their term in office and after their resignation (except where a director engages in conduct involving a lack of good faith). Ingham's constitution provides that it may indemnify its auditor against liability incurred in its capacity as the auditor of Ingham's and its controlled entities. Ingham's has not provided such an indemnity. Indemnification and insurance of officers During the reporting period and since the end of the reporting period, the consolidated entity has paid premiums in respect of a contract insuring directors and officers of the consolidated entity in relation to certain liabilities. The insurance policy prohibits disclosure of the nature of the liabilities insured and the premium paid. Lead auditor's independence declaration The lead auditor's independence declaration required under section 307C of the Corporation Act 2001 is included on page Non-audit services The following non-audit services were provided by the entity's auditor, KPMG. The directors are satisfied that the provision of non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The nature and scope of each type of non-audit service provided means that auditor independence was not compromised. This assessment has been confirmed to the Board by the Audit & Risk Committee. KPMG received or are due to receive the following amounts for the provision of non-audit services:

43.

Tax compliance, advisory and other services ¹³⁷ IPO due diligence services 1,121 Rounding of amounts The amounts contained in this report and in the financial statements have been rounded to the nearest hundred thousand dollars unless otherwise indicated under the option available to the Group under ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument 2016/191.

\$000
1,258

Operating and financial review Non-IFRS measures Throughout this report, Ingham's has included certain non-IFRS financial information, including EBITDA, and pro forma equivalents of IFRS measures such as net profit after tax. Ingham's believes that these non-IFRS measures provide useful information to recipients for measuring the underlying operating performance of Ingham's in light of the significant non-recurring events that have occurred, including the IPO. EBITDA stands for Earnings Before Interest, Tax, Depreciation, and Amortisation. This is calculated throughout the Operating and Financial Review consistent with the segment note to the financial statements from page 62. Pro forma results (52 weeks) Pro forma results are provided for the financial year ended 1 July 2017 to allow shareholders to make a meaningful comparison with the pro forma Prospectus and to make an assessment of the Group's performance as a listed company. Pro forma adjustments have been made on a consistent basis with the those made in the Prospectus. A reconciliation of the pro forma results to the statutory results is provided in tables 3 and 4 below.

report and financial review forma results (52 weeks) 1: Pro forma results for FY2017 actual compared to forecast* Pro forma Pro forma Consolidated income statement FY17 FY16 Prospectus Actual forecast Change Actual Change \$000 \$000 \$000 \$000 \$000 Revenue 2,383,900 2,375,000 8,900 2,308,700 75,200 (1,927,100) (1,916,600) (10,500) (1,886,300) (40,800) Cost of sales Gross profit 456,800 458,400 (1,600) 422,400 34,400 Other income 6,900 - 6,900 3,700 3,200 Distribution expense (141,600) (144,200) 2,600 (135,700) (5,900) Sales, general and administration expense (127,800) (124,600) (3,200) (123,400) (4,400) 700 500 200 500 200 Share of net profit of associate EBITDA 195,000 190,100 4,900 167,500 27,500 (41,600) (42,200) 600 (34,400) (7,200) Depreciation & amortisation EBIT 153,400 147,900 5,500 133,100 20,300 (16,300) (15,400) (900) (18,000) 1,700 Net interest expense Net profit before tax 137,100 132,500 4,600 115,100 22,000 (35,100) (33,700) (1,400) (32,000) (3,100) Income tax expense 102,000 98,800 3,200 83,100 18,900 NPAT	Directors' Operating Pro Table

For the year ended 1 July 2017 Directors' report Operating and financial review Statutory results Table 2: Statutory results for FY17 actual compared to forecast Statutory Statutory Consolidated income statement FY17 (53 weeks) FY16 (52 weeks) Actual Forecast Change Actual Change \$000 \$000 \$000 \$000 \$000 Revenue 2,426,900 2,419,300 7,600 2,308,700 118,200 (1,962,800) (1,951,400) (11,400) (1,886,300) (76,500) Cost of sales Gross profit 464,100 467,900 (3,800) 422,400 41,700 Other income 10,400 - 10,400 3,700 6,700 Distribution expense (144,500) (147,000) 2,500 (135,700) (8,800) Sales, general and administration expense (170,400) (166,900) (3,500) (184,300) 13,900 700 500 200 500 200 Share of net profit of associate EBITDA 160,300 154,500 5,800 106,600 53,700 (42,400) (43,100) 700 (34,400) (8,000) Depreciation & amortisation EBIT 117,900 111,400 6,500 72,200 45,700 (40,700) (43,200) 2,500 (39,700) (1,000) Net interest expense Net profit before tax 77,200 68,200 9,000 32,500 44,700 (18,100) (15,500) (2,600) (7,300) (10,800) Income tax expense 59,100 52,700 6,400 25,200 33,900 Net profit after tax FY17 Forecast as per Ingham's Supplementary Prospectus dated 2 November. FY16 Actual as per Ingham's Prospectus dated 21 October 2016.
Statutory results vs forecast and PY actual
Business drivers behind the year on year on performance have been described on page 12 from the review of Pro forma
results compared to forecast. Items included in the statutory results that are not included in the Pro forma results include: A 53rd trading week in the FY17 results compared to 52 weeks in FY16.
Other income includes a \$3.5m gain on disposal in respect of insurance recoveries in excess of the book value of destroyed
assets. this was recognised in week 53.
Reduction in non-recurring expenses of \$21.3m which in FY16 comprised costs of relocation, site closure and business transformation. FY17 includes \$28m expensed in respect of the IPO and \$6.1m of remaining costs of relocation and transformation.
Increase in interest expense reflective of costs incurred in exit of old finance facilities (\$17.2m), with underlying interest

		For the	year ended	1 July 2017
Directors' report
Operating and financial review
Reconciliations - pro forma to statutory
Table 3: Reconciliation of pro forma EBITDA to	statutory EBITDA
Consolidated EBITDA (\$m)		FY17	FY17	FY16
	Note	Actual	Forecast	Actual
Statutory Revenue		2,426.9	2,419.3	2,308.7
Removal of 53rd week	1	(43.0)	(44.3)	-
Pro forma revenue		2,383.9	2,375.0	2,308.7
Statutory EBITDA		160.3	154.5	106.6
Removal of 53rd week	1	(3.8)	(4.3)	-
Removal of transformation and relocation costs	2	6.1	6.4	59.6
Removal of advisory fees	3	1.2	1.0	3.1
Removal of IPO costs	4	28.0	28.9	0.4
Inclusion of listed company costs	5	(1.0)	(0.9)	(2.2)
Removal of legacy LTI scheme Pro forma EBITDA	6	4.2 195.0	4.5 190.1	- 167.5
Table 4: Reconciliation of pro forma NPAT to statutory	net profit after tax
Consolidated NPAT (\$m)	Note	FY17 Actual	FY17 Forecast	FY16 Actual
Statutory NPAT		59.1	52.7	25.2
Removal of 53rd week	1	(2.2)	(2.3)	-
Removal of transformation and relocation costs	2	4.3	4.5	41.8
Removal of advisory fees	3	0.8	0.7	2.2
Removal of IPO transaction costs	4	19.6	20.2	0.3
	5	(0.8)	(0.8)	(1.6)
	6	4.2	4.5	-
of listed company costs
Inclusion Removal of legacy LTI scheme Removal of finance facility exit costs	7	12.5	15.3	-
Change in capital structure	8	4.5	4.0	15.2

		Note	Actual	Forecast	Actual
Removal	of transformation and relocation costs	2	4.3	4.5	41.8
Removal	of advisory fees	3	0.8	0.7	2.2
Removal	of IPO transaction costs	4	19.6	20.2	0.3
Inclusion	of listed company costs	5	(0.8)	(0.8)	(1.6)
Removal	of legacy LTI scheme	6	4.2	4.5	-
Removal	of finance facility exit costs	7	12.5	15.3	-
Change	in capital structure	8	4.5	4.0	15.2
Pro	forma NPAT		102.0	98.8	83.1
In FY17,	due to the timing of the fiscal year end, the statutory period is a	53 week period. This	adjustment removes	the 53rd week	of
(1) results	in FY17.
(2) Costs	relate to the closure of the Cardiff, NSW primary processing facility,	consultant costs incurred	as part of the	transformation	program
that	commenced in FY15, and costs of relocating the head office from	Liverpool, NSW to North	Ryde, NSW.
(3) Relates	to fees for services charged by TPG Entities in respect of the period	prior to IPO which have	not been incurred	following	IPO. This
	removes the fees attributable to the period prior to IPO.
adjustment
Adjustment (4) Costs	to remove the costs expensed in connection with the IPO. that would have been incurred as a listed public company had	Ingham's been listed for the	full financial year,	with a part	year
(5) adjustment	in FY17 for costs not incurred prior to the IPO, as costs for	the period following the IPO	are included in	the statutory	& forecast
results	for FY17.
Removal Removal	of the share-based payments expense recognised in FY17 in of the write-off of capitalised establishment costs associated	relation to the legacy LTI with the previous banking	scheme. facilities and costs	associated	with
(6) (7) breaking (8) Removal	the swaps associated with the previous banking facilities. of the finance costs associated with the previous banking facilities	and inclusion of the	estimated finance	costs that	would have

Australia

Operating and financial	review
Australia
Table 5: Selected statutory financial information	for the Australia segment
Consolidated income statement
	Actual FY17 \$000	Actual FY16 \$000	Change \$000
Revenue EBITDA	2,058,400 163,100	1,981,800 129,800	76,600 33,300
Australia revenue growth driven by poultry growth for all poultry).	volumes which are up 8.8% on prior year excluding	ingredients	volumes (13.4%
Strong growth presents challenges due to the of clearance product which is sold at reduced workforce with overtime and extended hours.	nature of a vertically integrated supply chain, margins. High processing volumes were	leading to an increased accommodated through	volume the existing
EBITDA growth in the year driven by direct reflected through the FY17 results, in addition to	margin improvement from the benefits of volume growth.	Project Accelerate	starting to be
New Zealand
Table 6: Selected statutory financial information	for the New Zealand segment
Consolidated income statement
	Actual FY17 \$000	Actual FY16 \$000	Change \$000
Revenue	368,500	353,400	15,100
EBITDA	36,700	36,500	200

Revenue	2,058,400	1,981,800	76,600
EBITDA	163,100	129,800	33,300
	Actual FY17 \$000	Actual FY16 \$000	Change \$000
Revenue	368,500	353,400	15,100
EBITDA	36,700	36,500	200
H2FY17 saw improved trading conditions and performance, flat on prior year limiting revenue improvement.	largely offsetting a challenging	first half. Poultry	volumes were
Dairy feed volumes are showing signs of improvement led by	the recovery in milk prices.
Strong free range sales and a commencement of exports continue to grow as a result of promotional activity and new EBITDA performance compared to the prior year.	have helped offset margin product development. Both	pressure. Further factors have driven	Processed sales the improved

	For	the year ended	1 July 2017
Directors' report
Operating and financial review
Balance sheet
Table 7: Selected statutory consolidated statement of financial position	for the year ended 1	July 2017
	FY17	FY16	Change
Selected consolidated statement of financial position	\$000	\$000	\$000
Current assets	698,300	572,700	125,600
Non-current assets	375,100	373,700	1,400
Total assets	1,073,400	946,400	127,000
Current liabilities	357,900 499,000	367,200 580,400	(9,300) (81,400)
Non-current liabilities Total liabilities	856,900	947,600	(90,700)
Net assets	216,500	(1,200)	217,700
Net assets
The Group has strengthened its balance sheet following the capital	raised by the IPO (\$154.2m)	and the profits	generated
in FY17 (\$59.1m).
Effective working capital management has led to an improved working	capital position, as	reflected in the	strong closing
cash balance at 1 July 2017. Trade receivables days has fallen, while	inventory holdings remain	comparable	year-on-year.
Current assets are also inclusive of \$46.4m of held for sale assets to be	sold in FY18.
Non-current asset values have remained stable in the year as capital	additions (inclusive of	insurance	re-instatements) of
\$101.2m have been offset by transfers into assets held for sale, and	depreciation charged in the	year.
Table 8: Consolidated statutory net debt as at 1 July 2017
		FY17	FY16
Net debt as at 1 July 2017		\$000	\$000
Bank loans		(450,000)	(548,800)
Capitalised loan establishment fees included in borrowings		1,400	7,300

additions (inclusive of depreciation charged in the	year.	re-instatements) of
	FY17 \$000	FY16 \$000
		(548,800)
		7,300
	(448,600)	(541,500)
	(299,600)	75,300 (466,200)
		insurance (450,000) 1,400 149,000

Operating and financial review include:

• Material business risks Material business risks faced by the Group that may have a significant effect on the financial prospects of the Group
• Import restrictions: Changes to import quarantine conditions in Australia and/or New Zealand that would allow additional forms of poultry to be imported could result in changes to the poultry market that would adversely impact Ingham's financial performance. • Food safety and disease outbreak: If products of Ingham's or a competitor became unsafe or were to be perceived as unsafe, reduced demand for Ingham's products or for poultry products as an industry could follow. Food safety costs can lead to significant costs being incurred for recalls or other operations to address such issues, in addition to compensation, penalties or liability claims which could be incurred. Outbreak of avian disease(s) occurring in Ingham's flock or in geographic areas in which Ingham's operates could lead to restriction on the use or transportation of affected poultry. Such disruption to supply, in addition to the other events identified here could have an adverse effect on Ingham's financial performance. • Supply chain disruption: Failure of a parent stock supplier, poor animal husbandry practices, poor feed quality or outbreak of disease could all cause a significant reduction in the volume or quality of Ingham's parent stock, limiting the Group's ability to supply sufficient volumes of product. Disruption to the supply chain such as time critical delays, failure or dispute with key suppliers or other events of disruption could have a material adverse impact on the Group's financial performance. • Regulatory factors: Ingham's requires a range of licences, permits and accreditations/certifications relating to food standards, animal welfare, workers compensation and the environment in order to continue operating successfully. Inability to secure or retain these regulatory approvals, or amendments or revoking of these approvals could have an adverse effect on Ingham's financial performance. Ongoing compliance with laws and regulations in the countries in which Ingham's operates, and ability to comply with changes to these laws and regulations are material to Ingham's business. Failure to do so would have a material adverse impact on Ingham's. • Transformation projects: Project Accelerate involves material capital investment and is expected to deliver cost savings and efficiencies to the business in future periods. Delays in the project or cost overruns, in addition to realised results differing from estimates, may negatively impact Ingham's financial performance compared to management's forecasts. • Material increase in input costs: There have been recent actual and forecast increases in a number of input costs
• such as utilities and commodities, ie grains and legumes. While Ingham's has a range of cost pass through arrangements in place with customers, especially in respect of feed prices, there may be instances where Ingham's is not able to pass through, or is delayed from passing through, increases in these costs to customers, resulting in the potential risk of margin erosion. Strategy and future prospects Ingham's vision is to become a world-class food company by delivering high quality products and services to its customers at the lowest cost. This vision is supported by a clear strategy based around our key strategic pillars. These pillars and current actions are: • Quality in all that we do: Remains the focus of our production processes, product development and customer interactions. Ingham's continues to look outside Australasia and leverage international best practice including

• recruitment of staff and executives.

• Operating and financial review

• Strategy and future prospects (continued) High performance culture: Investment commenced in FY17 will continue in enhancing skills and capability across
• the workforce. Delivering for our customers: Focussed on extending further supply contracts with key customers to ensure we deliver to customer expectations and can plan to do so accordingly over extended periods. • Improve returns and invest for future growth: South Australian feedmill sale and leaseback process completed in June 2017, alongside property sales in FY17 and properties to be sold in FY18, will allow for the deployment of capital in pursuit of growth objectives. First phase automation projects optimised in Primary Processing plants producing yield improvements alongside progress on labour efficiencies and procurement. A strategic review of the stockfeed operation has also commenced and the business will continue to look to optimise the further
• processing network and pursue longer term export opportunities. World class operations & build capability: Hatchery and breeder expansions in South Australia have been completed along with automation projects now operational in Primary Processing and Further Processing facilities. Work continues on capacity expansion in both Australia and New Zealand together with the continued review towards optimising the network. A preferred site is being reviewed for a greenfield New Zealand hatchery. Construction has commenced on the new feed mill in South Australia and a new distribution centre in Queensland which is scheduled to be operational in H2 FY18. Investment will continue in enhancing skills and capability across the workforce.

Directors' report Letter from the Chairman of the People & Remuneration Committee Dear Shareholder,

On behalf of the Board of Directors of Ingham's, I am pleased to present our Remuneration Report for 2017. This report provides a summary of Ingham's remuneration strategy, arrangements and outcomes for the Chief Executive Officer (CEO), direct reports of the CEO (Senior Executives) and Non-Executive Directors. During the 2017 financial year, Ingham's successfully listed on the Australian Stock Exchange (ASX), completing the journey embarked on when Ingham's was acquired by TPG Capital in 2014. The remuneration of the CEO and Senior Executives reflects the significant change from private equity to listed company ownership. The remuneration and bonuses of the CEO and Senior Executives were set and approved by the Board at the commencement of the financial year, with the successful completion of the IPO as a key strategic objective. The IPO was officially completed on 7 November 2016 when Ingham's was admitted to the Official List of the ASX. Bonuses linked to the IPO were paid during the 2017 year and are included in the remuneration table presented from page 36. The bonuses reflect the one-off IPO event and reward the efforts of the CEO and Senior Executives who were instrumental in meeting the objectives of the previous majority shareholder. The bonuses were settled with a combination of shares and cash to continue to align executives' interests with those of shareholders. Given the one-off nature of an IPO listing, the IPO linked incentives will not re-occur. All incentive arrangements were disclosed in the Ingham's Prospectus lodged with ASIC on 21 October 2016, to ensure transparency with existing and potential future investors through the IPO process. The completion of the IPO also triggered vesting of a number of legacy long term incentive plans, awarded to select individuals in the years prior to the IPO. The grant date fair value of these awards that vested from the IPO is detailed on page 34 & 35, and is reflected in the movements in options and shares held by key management personnel on pages 38-41. Bonuses for Key Management Personnel including the CEO, not linked to the IPO, were 'at target' due to 'at target' delivery of all relevant KPIs in line with the Prospectus (refer to page 33. It is noted that the 'stretch' element of bonuses, if achieved in future years, is self-funded, so any bonuses earned above the 'at target' levels would be paid from incremental earnings and not reduce distributable earnings. As part of Ingham's transformation, the Senior Executive team underwent a restructure to reflect the new context of a public company. Mick McMahon was appointed Chief Executive Officer and Managing Director, Janelle Cashin was appointed Chief Operating Officer and Quinton Hildebrand was appointed Chief Commercial Officer. Throughout this transitional year, management: • Delivered on the Group strategy to grow the business - pro forma (52 week) volume growth of 5.4%, proforma

EBITDA growth of 16.4% and pro forma NPAT growth of 22.7%, all ahead of Prospectus forecasts; • Delivered Project Accelerate initiatives - focussing on automation, procurement, labour efficiency and closure of the Cardiff primary processing plant; • Delivered a capital investment program focussing on capacity and efficiency - commissioned South Australian hatchery and breeder network expansions, South Australian feed mill and New Zealand hatchery on track; • Continued progress in extending key customer contractual coverage - extending our national agreement as the majority supplier of poultry products to Woolworths supermarkets in Australia until mid-2021; • Delivered investment in capability - spanning operations, category, marketing and new product development; and • Delivered responsible financial management resulting in strong net operating cash inflows of \$170.0 million and net debt of \$299.6 million (a reduction of \$118.6 million since listing).

Directors' report Letter from the Chairman of the People & Remuneration Committee (continued)

• Ingham's delivered total shareholders' return (TSR) of 7.8% for post-IPO FY17, EPS accretion of 107% on a statutory basis, and will deliver dividends of 12.1 cents in respect of FY17 post-IPO pro forma earnings at a payout ratio of 70%. Key outcomes on FY17 remuneration (1) The new roles and positions in the Senior Executive team included changes to their Fixed Remuneration. Details are included in the remuneration table presented from page 36;

• (2) To better align with shareholders' interests, a financial gateway was introduced in the Short Term Incentive (STI) Plan ensuring STI payments were only awarded upon reaching the minimum target threshold; (3) STI bonuses for Key Management Personnel including the CEO, were 'at target' due to 'at target' delivery of all relevant KPIs in line with the Prospectus. Refer to page 26 for details of the STI bonuses; and (4) Senior Executives entered into a 3 year Long Term Incentive (LTI) scheme based upon Earnings per share (EPS) and Total shareholder return (TSR) targets. No awards in relation to this scheme have vested in the year, or will vest

• until November 2019 at the earliest. The details of this scheme are included from page 28. Future changes to remuneration being considered (1) To further align senior executive's interests with shareholder interests, the Ingham's STI Plan for FY18 will introduce a gateway consisting of non-financial measures of safety, quality and reputation. By measuring non-financial indicators, it encourages our senior executives to focus on the underlying drivers of financial performance; and (2) An FY18 LTIP scheme is currently under consideration with the expectation it will be approved by September Yours faithfully, Helen Nash Chairman, People and Remuneration Committee

• 2017.

Contents

5 Overview of company performance 6 . Performance and executive remuneration outcomes in FY17 7 Statutory and share based reporting 1 Remuneration report overview This report covers the key management personnel (KMP) of Ingham's who are responsible for determining and executing the business strategy. This includes both the Executive KMP (the CEO, CFO and certain heads of business units who are part of the Executive Committee) as well as Non-Executive Directors.

Contents
1 Remuneration report This report covers the key the business strategy. This of the Executive Committee) KMP are those persons who, the major activities of Ingham's.	overview management personnel (KMP) of Ingham's who includes both the Executive KMP (the CEO, CFO as well as Non-Executive Directors. directly or indirectly, have authority and	are responsible for determining and executing and certain heads of business units who are part responsibility for planning, directing and controlling
The table below outlines the Name	KMP of Ingham's and their movement during Position	FY17: Terms as KMP
	Non-executive	directors
Peter Bush	Non-Executive Chairman	From 7 October 2016
Linda Bardo Nicholls, AO	Non-Executive Director	From 7 October 2016
Simon Harle	Non-Executive Director	From 7 October 2016
Ricky Lau	Non-Executive Director	Full financial year
Helen Nash	Non-Executive Director	From 16 May 2017
Bernard Brookes	Non-Executive Director (former)	To 7 October 2016
	Executive	directors
Mick McMahon Kevin McBain	Chief Executive Officer (CEO) Director (former)	Full financial year To 7 October 2016
	Senior	executives
Ian Brannan	Chief Financial Officer (CFO)	Full financial year
Janelle Cashin	Chief Operating Officer (COO)	Full financial year
Quinton Hildebrand	Chief Commercial Officer (CCO)	Full financial year
Jonathan Gray Adrian Revell	Sales & Marketing Director Managing Director - New Zealand	Full financial year Full financial year

Remuneration report (audited) 2 How remuneration is governed A. Remuneration decision making The Board, People and Remuneration Committee and management work together to apply our remuneration principles and ensure our strategy supports sustainable shareholder value. The composition of the People & Remuneration Committee is set out on page 5 of this financial report. Ingham's has several policies to support a strong governance framework. These policies include a Diversity Policy, Disclosure Policy and Securities Dealing Policy, and they have been implemented to promote responsible management and conduct. Further information is available at: http://investors.inghams.com.au The Committee's Charter allows the Committee access to specialist external advice about remuneration structure and levels, which it intends to utilise periodically in support of its remuneration decision making process. No consultants were engaged in the year to provide recommendations in respect of KMP remuneration. The following diagram represents Ingham's remuneration decision making framework:

Remuneration report (audited) 3 Overview of executive remuneration A. How we determine executive remuneration policies and structures

Remuneration report (audited)
3 Overview of executive	remuneration
A. How we determine executive	remuneration policies and structures
The remuneration framework
achievement of strategic remuneration framework are:	is designed to attract, motivate objectives and link pay to shareholders'	and retain high performing executives, reward the interests. The key principles supporting Ingham's
Principle	Objective	Application
Competitive Remuneration	Reward Executives competitively for their contributions to Ingham's success	• Total remuneration is based on the Executive's capabilities and experience • Remuneration is benchmarked against an appropriate comparator group of companies within the S&P/ASX 200 index excluding financial, mining and real estate sectors • The Board approves recommendations on total remuneration package

Remuneration report (audited) 3 Overview of executive remuneration (continued) B. Our executive remuneration policies and structures Ingham's Executive KMP remuneration consists of fixed remuneration, short-term incentives and long-term incentives in the form of performance rights (Rights). Ingham's Executive KMP remuneration includes both fixed and variable components. Variable rewards consist of short and long term incentives that are based on Group performance outcomes. Non-Executive Directors do not have a variable performance related component to their remuneration, hence none of their remuneration is at risk. The graphs below set out the remuneration mix for the CEO and other Executive KMP at Ingham's in FY17, illustrating the fixed and variable proportions of remuneration at target and maximum levels:

3 Overview of executive remuneration (continued) C. Elements of remuneration Fixed remuneration Fixed remuneration is comprised of base salary, salary sacrificed items and employer superannuation contributions, in line with statutory obligations. Fixed remuneration is reviewed annually taking into consideration: • Performance • Organisational level • Role and responsibilities • Impact on the business • Commercial outputs; and

• Market benchmarking Short Term Incentive (STI) Plan STI provides the Executive KMP and other senior members of the management team a cash incentive where specific outcomes have been achieved in the financial year. STI payments are calculated as a percentage of base salary or fixed remuneration as per contractual arrangements and conditional on achieving the organisational performance target. Ingham's organisational performance is measured by the Group's Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA). EBITDA has been assessed as the most suitable measure of financial performance for the STI due to its expected alignment to the generation of cash earnings for Ingham's and its shareholders. The following table outlines the key features of the FY17 STI Plan, granted to the Executive KMP on 21 November 2016:

		For the	year ended 1 July 2017
Directors' report
Remuneration report (audited)
3 Overview of executive remuneration	(continued)
C. Elements of remuneration (continued)
Objective	To reward participants for aligned to prospectus forecasts	achieving strategic for FY17.	business objectives
Participants	All Executives and selected	senior management
Performance Period	Financial year ending 1 July	2017
Opportunity	Executive KMP	On Target	Stretch
	CEO	100% of Fixed	125% of Fixed
	CFO	Remuneration 50% of Fixed	Remuneration 62.5% of Fixed
	COO, CCO	Remuneration 35% of Base	Remuneration 70% of Base Salary
	Sales & Marketing Director,	Salary 35% of Base	70% of Base Salary
	Managing Director - NZ	Salary
Performance Measures	x EBITDA performance is measured	at three levels:
		Full Year Target
	Threshold	\$190.1 million
	Target	\$195.0 million
	Stretch	\$200.0 million
	• A straight-line method operates between target and stretch	between threshold	and target, and
	• FY17 payments were determined EBITDA as assessed by the Board	on 52 week in its sole discretion	financial year pro-forma
Payment Method	Participants receive a cash performance year.	payment following the	end of the

3 Overview of executive remuneration (continued) C. Elements of remuneration (continued) Legacy Long Term Incentive (LTI) Plan (pre-IPO) and voluntary escrow arrangements At the time of the IPO, pre-IPO shareholders entered a voluntary escrow deed with Ingham's that prevents them from dealing with their escrowed shares during the applicable escrow period. The restriction on dealing is broadly defined and includes among other things, selling, assigning, transferring or otherwise disposing of any interest in the shares, encumbering or granting a security interest over the shares, doing, or omitting to do, any act if the act or omission would have the effect of transferring effective ownership or control of any of the shares or agreeing to do any of those things. Shares held by members of the management team are escrowed until 4.30pm on the date on which Ingham's full-year annual results for FY18 are announced to the ASX (except for shares purchased by Mick McMahon and Ian Brannan using their IPO bonuses, which are escrowed until 7 November 2018). Inghams Group Limited Equity Incentive Plan (LTI Offer)

Shares held by members of the annual results for FY18 are announced their IPO bonuses, which are escrowed	management team are escrowed until 4.30pm on the date on which Ingham's full-year to the ASX (except for shares purchased by Mick McMahon and Ian Brannan using until 7 November 2018).
Inghams Group Limited Equity	Incentive Plan (LTI Offer)
The table below outlines the key	terms of the FY17 LTI Offer under the Plan:
Term	Description
Eligibility to participate in LTI Offer	• Offers may be made at the Board's discretion to employees of the Ingham's Group or any other person that the Board determines to be eligible to receive a grant under the Plan
	• The 2017 LTI Offer has been made to the following Ingham's KMP Executives:
	- Mick McMahon (Chief Executive Officer)
	- Ian Brannan (Chief Financial Officer)
	- Janelle Cashin (Chief Operating Officer)
	- Quinton Hildebrand (Chief Commercial Officer)
	- Jonathan Gray (Sales & Marketing Director)
	- Adrian Revell (Managing Director - NZ)
Offers under the Plan	• The LTI Offer is a grant of performance rights
Grant of Rights	• A Right entitles the participant to acquire a Share for nil consideration at the end of the performance period, subject to meeting specific performance conditions. The Board retains the discretion to make a cash payment to participants on vesting of the Rights in lieu of an allocation of shares.
Quantum of Rights	The face value of the LTI Offer is \$3.25 million.
	Mick McMahon was granted Rights with a face value of \$1.5 million. Other participating members of senior management were granted Rights with a cumulative face value of \$1.75 million.
	The final number of Rights awarded to each participant was calculated by dividing the dollar value of their LTI opportunity by the Final Listing Price of \$3.15.

Directors' report
Remuneration report (audited)
3 Overview of executive remuneration	(continued)
C. Elements of remuneration	(continued)
Long Term Incentive Plan for FY17	(continued)
Performance period	The performance period commenced on ends on 30 June 2019.	7 November 2016 (date of ASX listing) and
Performance conditions	• Rights granted as part of the LTI Offer period, subject to meeting the performance	will vest at the end of the performance conditions.
	• The performance conditions are:
	• 75% of the Rights are subject to a absolute EPS over the performance period	performance condition based on Ingham's (EPS Component); and
	• The remaining 25% of the Rights are (TSR) performance condition, measured Component). Ingham's relative TSR will be comprising the ASX 200 (excluding companies resources).	subject to a relative total shareholder return over the performance period (TSR compared to a comparator group classified as financial, mining and
	EPS Component
	• For any Rights in the EPS Component to (as set out below). The percentage of Rights vest, if any, will be determined over the following vesting schedule:	vest, a threshold target must be achieved comprising the EPS Component that performance period by reference to the
	Ingham's EPS over the performance period	% of Rights that vest
	Less than threshold	Nil
	Equal to threshold	50%
	Greater than threshold up to maximum target	Straight line pro rata vesting between 50% and 100%
	At or above maximum target	100%
	• Threshold and maximum targets will be each financial year, with vesting of the EPS against these targets over the 3 year was based on the pro forma FY17 52 week maximum set at 25% pro forma NPAT growth.	set annually by the Board at the start of Component based on achievement performance period. For FY17, the threshold forecast NPAT (\$98.8m) and the

		Directors' report For the year ended 1 July 2017
Directors' report
Remuneration report (audited)
3 Overview of executive	remuneration (continued)
C. Elements of remuneration	(continued)
Performance conditions (continued)	TSR Component
	• The percentage of Rights comprising the based on Ingham's TSR ranking over the following vesting schedule:	TSR Component that vest, if any, will be performance period, as set out in the
	Ingham's TSR rank in the Relevant Comparator Group	% of Rights that vest
	Less than 50th percentile	Nil
	At 50th percentile (threshold performance)	50%
	Between 50th and 75th percentile	Straight line pro rata vesting between 50% and 100%
	At 75th percentile or above	100%
	• Performance will not be re-tested if the at the end of the performance period. Any of the performance period will lapse	performance conditions are not satisfied Rights that remain unvested at the end immediately.
Voting and dividend entitlements	The Rights granted under the LTI Offer do to vesting. Shares allocated upon vesting voting rights as other Shares.	not carry dividend or voting rights prior of Rights carry the same dividend and
Restrictions on dealing	Participants must not sell, transfer, encumber, Rights comprising the LTI Offer unless the by law.	hedge or otherwise deal with the Board allows it or the dealing is required
	Participants will be free to deal with the comprising the LTI Offer, subject to the Dealing Policy.	Shares allocated on vesting of the Rights requirements of the Ingham's Securities
Cessation of employment	If the participant ceases employment for the Board determines otherwise, any Board has the discretion to designate a automatically lapse.	cause or due to their resignation, unless unvested Rights will automatically lapse. The "good leaver", whereby Rights will not
	In all other circumstances, the Rights will the performance period that has elapsed) original performance conditions, unless them otherwise.	be pro-rated (based on the proportion of and remain on foot and subject to the the Board exercises a discretion to treat

					Directors' report For the year ended 1 July 2017
Directors'	report
Remuneration report	(audited)
3 Overview of executive	remuneration	(continued)
C. Elements of	remuneration	(continued)
Clawback and inappropriate benefits	preventing	Under the Plan which it may	rules and the terms exercise, including	of the LTI Offer, the among other things:	Board has clawback powers
		• The participant misconduct, company into Ingham's is	has acted fraudulently brought Ingham's, the disrepute or breached required by or entitled	or dishonestly, Ingham's Group or their obligations under law or Ingham's	has engaged in gross any Inghams' Group to the Inghams' Group, or policy to reclaim
		remuneration • There is a	from the participant; material misstatement	or omission in the	accounts of an Ingham's
		Group company;	or
		• The participant's breach of obligations Rights would not	entitlements of any other have otherwise	vest or may vest as a person and the Board vested.	result of fraud, dishonesty or is of the opinion that the
Executive employment	agreements
Key terms of the below:	Executive Service	Agreements for the	CEO and other	Executive KMP members	are presented in the table
Executive KMP		Position	Contract duration	Notice Period	Termination payments applicable
Mick McMahon	CEO		Unlimited	12 months	12 months fully paid
Ian Brannan	CFO		Unlimited	12 months	12 months fully paid
Janelle Cashin	COO		Unlimited	12 months (individual's	12 months fully paid

Position	duration	Notice Period	Termination payments applicable
CEO	Unlimited	12 months	12 months fully paid
CFO	Unlimited	12 months	12 months fully paid
COO	Unlimited	12 months (individual's notice) / 9 months (Ingham's notice)	12 months fully paid
CCO	Unlimited	6 months	6 months fully paid
Sales & Marketing Director	Unlimited	6 months	6 months fully paid
Managing Director - NZ	Unlimited	6 months (individual's notice) / 9 months (Ingham's notice)	Applicable notice period fully paid
		Contract

Directors' report Remuneration report (audited) 4 Overview of non-executive director remuneration The details of fees paid to Non-Executive Directors in FY17 are outlined in section 7 of this Remuneration Report. Non-Executive Directors' fees were fixed and they did not receive any performance based remuneration. Directors who resigned during the year were remunerated under a previous structure and their remuneration is detailed in the statutory remuneration tables in this Remuneration Report. The table below outlines the fee structure for Non-Executive Directors in FY17 (inclusive of superannuation as applicable). The annual aggregate fee pool for Non-Executive Directors is capped at \$2.0m. Board and committee fees inclusive of statutory superannuation contributions are included in this aggregate fee pool. FY17 fees are pro-rated based on service

resigned during the year were remuneration tables in this	remunerated under a previous Remuneration Report.	structure and	their remuneration	is	detailed in the	statutory
The table below outlines the The annual aggregate fee pool statutory superannuation commencing on the later of	fee structure for Non-Executive for Non-Executive Directors is contributions are included in this aggregate date of appointment or the date of	Directors in FY17 capped at fee listing (7 November	(inclusive \$2.0m. Board pool. FY17 fees 2016).	of superannuation and committee are pro-rated	as fees based	applicable). inclusive of on service
Board fees				\$
Chairman			350,000	(inclusive of
Non-executive Director			committee	fees) 140,000
Committee fees
Audit and Risk	Chair			20,000
People and Remuneration	Chair			20,000
Nomination	Chair			-
Non-Executive Directors do not	receive additional fees for participation	as	committee	members.
5 Overview of company	performance
Since the Company was not	a disclosing entity during or prior to	the financial	year	ended 1 July	2017, the	relationship
between remuneration policy prior.	and Group performance is only	assessed for	the current	financial	year and the	two years
	FY17	FY17 Pro	FY16	FY16 Pro	FY15	FY15 Pro
	Actual	forma	Actual	forma	Actual	forma
Revenue (\$'m)	2,426.9	2,383.9	2,308.7	2,308.7	2,273.8	2,271.9
EBITDA (\$'m)	160.3	195.0	106.6	167.5	301.7	114.5

Since the Company was not a	disclosing entity during or prior to	the financial	year	ended 1 July	2017, the	relationship
between remuneration policy and prior.	Group performance is only	assessed for	the current	financial year	and the	two years
	FY17	FY17 Pro	FY16	FY16 Pro	FY15	FY15 Pro
	Actual	forma	Actual	forma	Actual	forma
Revenue (\$'m)	2,426.9	2,383.9	2,308.7	2,308.7	2,273.8	2,271.9
EBITDA (\$'m)	160.3	195.0	106.6	167.5	301.7	114.5
Profit after tax (\$'m)	59.1	102.0	25.2	83.1	146.9	51.7
Dividends per year (cents per share)	2.6	2.6	-	-	98	98
Return of capital (cents per share) Movement in share price post-IPO (cents per share)	- 23	- 23	- n/a	- n/a	63 n/a	63 n/a

6 Performance and executive remuneration outcomes in FY17 A. Performance against STI measures

Remuneration report	(audited)
6 Performance and	executive remuneration	outcomes	in FY17
A. Performance against	STI measures
Performance against FY17	STI Plan
'At target' Performance target' incentive payment	against EBITDA as follows:	as identified	under the STI	Plan resulted in	each Executive KMP earning an
Executive KMP	STI target - \$	STI target	Maximum STI	STI portion earned - \$	Forfeit against STI maximum
Mick McMahon	1,500,000	100%	125%	1,500,000	375,000
Ian Brannan	375,000	50%	62.5%	375,000	93,750
Janelle Cashin	239,726	35%	70%	239,726	239,726
Quinton Hildebrand	207,762	35%	70%	207,762	207,762
Jonathan Gray	166,210	35%	70%	166,210	166,210
Adrian Revell	145,489	35%	70%	145,489	145,489
All STI portions earned	are to be paid shortly	after the	end of the reporting	period.
B. Performance against	LTI measures
LTI vesting outcomes
Pre-IPO LTI schemes Directors and Executive	vested upon Ingham's KMP vested as	IPO, detailed in section	completed on 7 7(b) of this	November 2016. Remuneration	Under this, 10,819,656 options Report.

may to in - - 428 104 21 35 588 11,641 320 remuneration prepared paid actual which earned \$000 actually Total but details awarded, remuneration remuneration - - - - - - - 28 - term benefits \$000 been (4) Long the have the of that view from 200 - - - - - 200 2,960 270 rights vested a differs \$000 with (3) performance LTI shareholders This post-IPO. - - - - - - - - - benefits short of \$000 provides values Other escrow conditions. term the it under include as 228 104 - - 21 388 50 35 8,653 relevant performance Cash remain \$000 details Total be which those to and/or considered of - - - - - - - 6,000 - as some Bonus report, service \$000 (2) period, IPO is this meet information of the to 36 - - - - - - - 1,250 - during (continued) failure page \$000 This STI (1) from vested of below. result personnel standards FY17 that a out 228 104 - - 21 35 388 1,403 50 in remuneration as LTIs outcomes year set management Fixed accounting \$000 of is the value FY17 in remuneration the forfeited in and KMP key and obligations Directors' by by FY17 (audited) were earned earned executive in amounts Actual performance statutory Directors Non-Executive AO remuneration remuneration report Nicholls, Directors' Directors and No Brookes Remuneration with vest. for Harle Bardo not
	Performance
	Actual
	accordance executives actual
	Non-Executive
	Bush
	Lau
	Nash
	Bernard
	Remuneration Sub-total
	Executive
	McMahon
	McBain
-	Remuneration Sub-total	1,841	1,250	6,000	9,091	3,430	28	12,549

		benefits Short-term		Post- employment	Long-term benefits	Share-based		Termination	Total Remuneration	Performance related
	& Salary	STI FY17	IPO bonus	Super-	leaveShare service Long	(equity options	payments	payments
	\$000 fees	Non-monetary \$000 bonus \$000	\$000 (cash)	\$000 annuation	\$000	\$000 settled)	Shares \$000	\$000	\$000	\$000
Directors Non-Executive Bush Peter	215	- -	-	13	-	-	200	-	428	-
AO Nicholls, Bardo Linda	95	- -	-	9	-	-	-	-	104	-
Harle Simon	-	- -	-	-	-	-	-	-	-	-
Nash Helen	19	- -	-	2	-	-	-	-	21	-
Lau Ricky	-	- -	-	-	-	-	-	-	-	-
non-executive Brookes Sub-total Bernard	32	- -	-	3	-	-	-	-	35	-
remuneration directors'	361	- -	-	27	-	-	200	-	588	-

reporting (audited) share-based report and Remuneration Statutory	(continued)
		Short-term	benefits		employment Post-	Long-term benefits	Share-based	payments	Termination payments	Remuneration Total	Performance related
	& fees Salary	bonus STI	Non-monetary	bonus (cash) IPO	annuation Super-	service leave Long	options settled) (equity Share	Shares
	\$000	\$000	\$000	\$000	\$000	\$000	\$000	\$000	\$000	\$000	\$000
Director McMahon McBain Executive Kevin	1,383 46	1,500 -	- -	- 6,000	20 4	- 28	1,711 90	- -	- -	140 10,642	90 9,211
remuneration directors' Total	1,790	1,500	-	6,000	51	28	1,801	200	-	11,370	9,301
executives Brannan Senior	744	375	-	2,000	20	11	862	-	-	4,012	3,237
Cashin Janelle	634	240	8	-	20	87	69	-	-	1,058	309
Hildebrand Quinton	598	208	-	-	20	10	148	-	-	984	356
Gray Revell Jonathan Adrian	485 399	166 146	- -	- -	20 31	9 5	97 70	- -	- -	777 651	263 216
executives' remuneration senior Total	2,860	1,135	8	2,000	111	122	1,246	-	-	7,482	4,381
remuneration and directors' executives' Total	4,650	2,635	8	8,000	162	150	3,047	200	-	18,852	13,682

No. Shares 2017 July 1 (continued) options reporting (audited) of exercise share-based report Hildebrand on issued McMahon and Remuneration Cashin McBain Brannan Statutory Shares Quinton Janelle	per share 1.00 0.81 paid Average 1,301,452 2,000,000 issued
	0.81 669,444
	1.00 700,000 -
Gray Jonathan	1.00 120,000
Revell Adrian	1.00 210,000

Net Options exercised (1,301,452) as remuneration 476,190 Granted 4,338,174 26 2016 Balance June McMahon McBain	1 2017 79,365 3,512,912 1,800,133 - Balance July Other change - - - - (2,000,000) (669,444) (700,000) 238,095 79,365 - 2,000,000 2,231,482 700,000	exercisable 2017 July 1 3,036,722 1,562,038 - at Exercisable Vested
Kevin Mick
Brannan
Cashin Janelle		-
- 79,365 450,000 Hildebrand Quinton	-	450,000 529,365
(120,000) (210,000) 79,365 79,365 400,000 700,000 Gray Revell Jonathan Adrian	359,365 569,365 - -	280,000 490,000
	- (5,000,896) 1,031,745 10,819,656	5,818,760 6,850,505

Other change Net options of exercise On as remuneration Granted 2016 June 26 Balance KMP and Directors of Shareholdings	2017 158,730 15,873 July 1 Balance 158,730 15,873 - - - - - - - -
- - Bush
- - AO Nicholls, Bardo
- - - - Harle Lau Simon
- - Nash
(750,000) - - 1,000,000 Brookes Bernard	250,000
directors Executive
(1,594,926) (5,000,000) 1,301,452 2,000,000 - - 617,284 3,000,000 McMahon McBain	323,810
executives Senior
(1,124,824) 669,444 - 617,284 Brannan	161,904
(240,000) 700,000 - 100,000 Cashin Janelle
- - - - Hildebrand Quinton	560,000
(120,000) (410,000) 120,000 210,000 - 200,000 - Gray Revell Jonathan Adrian

Inghams Group Limited (formerly Ingham Holdings I Pty Limited) Directors' report For the year ended 1 July 2017 Directors' report Signed in accordance with a resolution of the directors made pursuant to s298(2) of the Corporations Act 2001. Linda Bardo Nicholls, AO Non-executive director

Chairman

Peter Bush North Ryde, Sydney 22 August 2017

• .

Inghams Group Limited (formerly Ingham Holdings I Pty Limited)

	Inghams Group Limited (formerly	Ingham Holdings Consolidated	I Pty Limited) income statement
		For the year	ended 1 July 2017
		53 weeks ended 1 July 2017	52 weeks ended 25 June 2016
	Notes	\$000	\$000
Revenue	4	2,426,900	2,308,700
Other income	5(a)	10,400	3,600
Expenses
Cost of sales		(1,998,900)	(1,919,100)
Distribution Administration and selling		(145,000) (136,700)	(136,100) (124,700)
Other	5(c)	(39,500)	(60,800)
Operating profit		117,200	71,600
Finance income and costs Finance income		1,100	2,200
Finance costs		(41,800)	(41,900)
Net finance costs	5(d)	(40,700)	(39,700)
Share of net profit associates	24	700	600
Profit before income tax		77,200	32,500
White space
Income tax expense	6(a)	(18,100)	(7,300)
Profit for the year attributable to: Owners of Inghams Group Limited		59,100	25,200
Basic EPS (cents per share) Diluted EPS (cents per share)	27 27	16.93 16.57	8.18 7.91
The above consolidated income statement should	be read in conjunction with the	accompanying	notes.

Inghams Group Limited (formerly Ingham Holdings I Pty Limited)

	Inghams Group Limited (formerly Consolidated	Ingham Holdings statement of	I Pty Limited) comprehensive income
		For the year	ended 1 July 2017
	Notes	1 July 2017 \$000	25 June 2016 \$000
Profit for the year		59,100	25,200
Giant white space Other comprehensive income
Items that may be reclassified to profit or loss
Changes in the fair value of cash flow hedges		14,300	-
Tax on changes in fair value of cash flow hedges Total items that have subsequently been reclassified to profit	or loss	(4,300) 10,000	- -
Exchange differences on translation of foreign operations	19(a)	(200)	8,100
Changes in the fair value of cash flow hedges Tax on changes in fair value of cash flow hedges		(1,700) 500	(6,000) 1,800
Total items that may subsequently be reclassified to profit	or loss	(1,400)	3,900
Items that will not be reclassified to profit or loss Revaluation of land and buildings		-	27,800
Tax on revaluation of land and buildings		-	(7,500)
Total items that will never be reclassified to profit or loss		-	20,300
x
Total comprehensive income for the year, attributable to:
Owners of Inghams Group Limited		67,700	49,400
The above consolidated statement of comprehensive	income should be read in	conjunction with	the
accompanying notes.

Inghams Group Limited (formerly Ingham Holdings I Pty Limited)

	Inghams Group Limited (formerly	Ingham Holdings	I Pty Limited)
	Consolidated	statement of	financial position
			As at 1 July 2017
		1 July 2017	25 June 2016
	Notes	\$000	\$000
ASSETS Current assets
Cash and cash equivalents	7	149,000	75,300
Trade and other receivables	8	230,400	221,300
Biological assets	9	114,600	115,300
Inventories Assets classified as held for sale	10 11	157,800 46,400	159,600 1,200
Derivative financial instruments		100	-
Total current assets		698,300	572,700
Non-current assets
Investments accounted for using the equity method Property, plant and equipment	24 12	2,000 372,800	1,600 372,100
Derivative financial instruments	16	300	-
Total non-current assets		375,100	373,700
Total assets		1,073,400	946,400
white space LIABILITIES
Current liabilities
Trade and other payables	13	270,300	239,800
Borrowings Current tax liability	14	- 8,100	21,200 5,000
Provisions	15	77,300	93,300
Derivative financial instruments		2,200	7,900
Total current liabilities		357,900	367,200
Non-current liabilities Trade and other payables	13	2,000	2,700
Borrowings	14	448,600	520,300
Provisions	15	37,200	44,100
Derivative financial instruments	16	-	6,500
Deferred tax liabilities Total non-current liabilities	6(c)	11,200 499,000	6,800 580,400
Total liabilities		856,900	947,600
Net assets/(net liabilities)		216,500	(1,200)
EQUITY
Contributed equity Reserves	17(a) 19(a)	262,000 43,000	107,800 33,400
Accumulated losses		(88,500)	(142,400)
Total equity/(deficiency of equity)		216,500	(1,200)

Inghams Group Limited (formerly Ingham Holdings I Pty Limited) Consolidated statement of changes in equity For the year ended 1 July 2017

			Inghams Group	Limited (formerly Consolidated	Ingham Holdings statement of For the year	I Pty Limited) changes in equity ended 1 July 2017
		Inghams	Attributable Group Limited	to owners of (formerly Ingham	Holdings I Pty	Limited)
		Contributed Equity	Accumulated losses	Asset revaluation reserve	Other reserves	test Total Equity / (Deficiency of equity)
White space	Notes	\$000	\$000	\$000	\$000	\$000
Balance at 27 June 2015		106,500	(167,600)	-	5,800	(55,300)
Profit for the year		-	25,200	-	-	25,200
Other comprehensive income Total comprehensive income	19(a)	-	- 25,200	- 20,300 20,300	3,900 3,900	24,200 49,400
Transactions with owners of Company	the
Contribution of equity	17	1,300	-	-	-	1,300
Share based payment expense	19(a)		-	- -	3,400	3,400
		1,300	-	-	3,400	4,700
Balance at 25 June 2016		107,800	(142,400)	20,300	13,100	(1,200)
Balance at 26 June 2016		107,800	(142,400)	20,300	13,100	(1,200)
Profit for the year Other comprehensive income	19(a)	-	59,100 - -	- -	- 8,600	59,100 8,600
Transfer to retained earnings	19(a)		- 3,600	(3,600)	-	-
Total comprehensive income		-	62,700	(3,600)	8,600	67,700
Transactions with owners of	the
Company
white space Reversal of dividend rights
forfeit		-	1,100	-	-	1,100
Issue of ordinary shares net of transaction costs	17	154,200	-	-	-	154,200
Dividends provided for or paid	18	-	(9,900)	-	-	(9,900)
Share based payment expense space	19(a)		-	- -	4,600	4,600
		154,200	(8,800)	-	4,600	150,000
			(88,500)	16,700	26,300	216,500

Inghams Group Limited	(formerly Ingham Holdings	I Pty Limited)
	Consolidated statement	of cash flows
	For the year	ended 1 July 2017
	53 weeks ended 1 July 2017	52 weeks ended 25 June 2016
	\$000	\$000
	Notes	Restated*
Cash flows from operating activities
Receipts from customers (inclusive of goods and services tax)	2,508,800	2,400,500
Payments to suppliers and employees (inclusive of goods and services tax)	(2,327,400) 181,400	(2,282,500) 118,000
Interest received	1,100	2,200
Income taxes paid	(12,500)	(25,300)
Net cash generated from operating activities	170,000 21	94,900
Cash flows from investing activities
Proceeds from sale of property, plant and equipment	-	100
Payments for property, plant and equipment	(96,700)	(76,800)
Proceeds from sale of assets held for sale	20,700	6,500
Net cash (used in) investing activities	(76,000)	(70,200)
Cash flows from financing activities
Proceeds from borrowings	470,000	-
Repayment of borrowings	(573,500)	(14,600)
Dividends paid	(9,700)	-
Proceeds from issue of shares IPO transaction costs	156,200 (34,400)	1,300 -
Proceeds from re-payment of management loans	2,300	-
Interest and finance charges paid	(31,200)	(36,700)
Net cash used in from financing activities	(20,300)	(50,000)
Net increase/(decrease) in cash and cash equivalents	73,700	(25,300)
Cash and cash equivalents at the beginning of the financial year	75,300	96,300
Effects of exchange rate changes on cash and cash equivalents	-	4,300
Cash and cash equivalents at end of year	149,000 7	75,300
* - Refer to note 2 for details.
The above consolidated statement of cash flows should be read in conjunction	with the accompanying	notes.

1 Corporate information The financial statements of Inghams Group Limited (formerly Ingham Holdings I Pty Limited) and its subsidiaries (collectively, the Group) for the 53 week year ended 1 July 2017 (comparative period was 52 weeks ended 25 June 2016) were authorised for issue in accordance with a resolution of the directors on 22 August 2017. Inghams Group Limited (the Company) is a for-profit company limited by shares incorporated in Australia. The principal activities of the Group during the year consisted of the production and sale of chicken and turkey products across its vertically integrated primary, free range, value enhanced, further processed and ingredient categories. Additionally stockfeed is produced primarily for internal use but also for the poultry, pig, dairy and equine industries. The registered office and principle place of business of Inghams Group Limited is: Level 4 1 Julius Avenue North Ryde NSW 2113 2 Summary of significant accounting policies The principal accounting policies adopted in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all years presented, unless otherwise stated. (a) Basis of preparation These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and interpretations issued by the Australian Accounting Standards Board and the Corporations Act 2001. The consolidated

Australia

financial statements comply with International Financial Reporting Standards (IFRS) adopted by the International Accounting Standards Board (IASB). (i) Historical cost convention The financial statements have been prepared on a historical cost basis, except for the following: • Financial assets and liabilities (including derivative instruments) and certain classes of property, plant and equipment - measured at fair value. • Assets held for sale - measured at the lower of cost (including revaluation adjustments where applicable), or fair value less cost of disposal. (ii) Critical accounting estimates and judgements The preparation of financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed below. • Fair value determination of freehold land and buildings - note 12; • The determination of workers compensation provision - note 15 ; and • Fair value of options granted under the long term incentive scheme, as determined at grant date - note 20.

Further details of the nature of these assumptions and conditions may be found in the relevant notes to the financial

statements.

2 Summary of significant accounting policies (continued) (a) Basis of preparation (continued) (iii) Comparatives The Group has reclassified amounts between categories in the consolidated statement of cash flows and associated

changes to the reconciliation of profit after tax as per note 21, being the classification of interest and finance charges paid as a financing activity (from operating activity), as this best represents the nature of these cash flows. (iv) Adoption of accounting standards The Group has adopted new and revised Standards and Interpretations issued by the AASB that are relevant to operations and effective for the current reporting period. The adoption of these new and revised Standards and Interpretations have not had a material impact on the Group for full year ended 1 July 2017. The following Standards, amendments to Standards and Interpretations that are not mandatory for 1 July 2017 reporting and have not been applied by the Group in this Financial Report are set out below:

AASB 9 Financial Instruments This standard is applicable to annual reporting periods beginning on or after 1 January 2018. The standard replaces all previous versions of AASB 9 and completes the project to replace AASB 139 Financial Instruments: Recognition and Measurement. AASB 9 introduces new classification and measurement models for financial assets. A financial asset shall be measured at amortised cost, if it is held within a business model whose objective is to hold assets in order to collect contractual cash flows, which arise on specified dates and solely principal and interest. All other financial instrument assets are to be classified and measured at fair value through profit and loss unless the entity makes an irrevocable election on initial recognition to present gains and losses on equity instruments (that are not held for trading) in other comprehensive income (OCI). For financial liabilities, the standard requires the portion of the change in fair value that relates to the entity's own credit risk to be presented in OCI (unless it would create an accounting mismatch). New simpler hedge accounting requirements are intended to more closely align the accounting treatment with the risk management activities of the entity. New impairment requirements will use an 'expected credit loss' (ECL) model to recognise an allowance. Impairment will be measured under a 12-month ECL method unless the credit risk on a financial instrument has increased significantly since initial recognition in which case the lifetime ECL method is adopted. The standard introduces additional new disclosures. The Group will adopt this standard from 1 July 2018 and the impact of its adoption is expected to be minimal due to the current hedging strategy of the Group permitting hedge accounting under existing accounting standards, and the absence of significant historical impairments from credit risk.

(a) Basis of preparation (continued) (iv) Adoption of accounting standards (continued) AASB 15 Revenue from Contracts with Customers This standard is applicable to annual reporting periods beginning on or after 1 January 2018. This standard provides a single standard for revenue recognition. The core principle of the standard is that an entity will recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard will require: contracts (either written, verbal, or implied) to be identified, together with the separate performance obligations within the contract; determine the transaction price, adjusted for the time value of money excluding credit risk; allocation of the transaction price to the separate performance obligations on a basis of relative stand-alone selling price of each distinct good or service, or estimation approach if no distinct observable prices exist; and recognition of revenue when each performance obligation is satisfied. Credit risk will be presented separately as an expense rather than adjusted against revenue. For goods, the performance obligation would be satisfied when the customer obtains control of the goods. For services, the performance obligation is satisfied when the service has been provided, typically for promises to transfer services to customers. For performance obligations satisfied over time, an entity would select an appropriate measure of progress to determine how much revenue should be recognised as the performance obligation is satisfied. Contracts with customers will be presented in an entity's statement of financial position as a contract liability, a contract asset, or a receivable, depending on the relationship between the entity's performance and the customer's payment. Sufficient quantitative qualitative disclosure is required to enable users to understand the contracts from customers; the significant judgements made in applying the guidance to those contracts; and any assets recognised from the costs to obtain or fulfil a contract with a customer. The Group will adopt this standard from 1 July 2018, and while the impact of its adoption is initially expected not to have a material effect on the financial statements, due to the lack of performance obligations or rights associated with sales transactions that span multiple reporting periods, a full review of this is in progress. AASB 16 Leases This standard is applicable to annual reporting periods beginning on or after 1 January 2019. For lessee accounting, the standard eliminates the 'operating lease' and 'finance lease' classifications required by AASB 117 Leases. Subject to exceptions, a 'right-of-use' asset will be capitalised in the statement of financial position, measured as the present value of the unavoidable future lease payments to be made over the lease term. The exceptions relate to short term leases of 12 months or less, and leases of low value assets (such as personal computers and office furniture) where an accounting policy choice exists whereby either a 'right-of-use' asset is recognised or lease payments are expensed to profit or loss as incurred. A liability corresponding to the capitalised lease will also be recognised, adjusted for lease prepayments, lease

incentives received, initial direct costs incurred and as estimate of any future restoration, removal or dismantling costs. Straight-line operating lease expense recognition will be replaced with a depreciation change for the leased asset (included in operating costs) and an interest expense on the recognised lease liability (included in finance costs). For classification within the statement of cash flows, the lease payments will be separated into both a principal (financial activities) and interest (either operating or financing activities) components. For lessor accounting, the standard does not substantially change how a lessor accounts for leases. The Group will adopt this standard from 1 July 2019 but the impact of its adoption, other than being a substantial increase in the gross assets and gross liabilities of the Group, is yet to be more specifically assessed. There are no other standards that are not yet effective and that are expected to have a material impact on the entity in the current or future reporting periods and on foreseeable future transactions. (b) Principles of consolidation (i) Subsidiaries The consolidated financial statements incorporate the financial statements of the Group and its subsidiaries and the results of all subsidiaries for the year ended 1 July 2017.

2 Summary of significant accounting policies (continued) (b) Principles of consolidation (continued) (i) Subsidiaries (continued) Subsidiaries are all entities controlled by the Group. The Group controls an entity when it is exposed to, 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 included in the consolidated financial statements from the date on which control commences until the date on which control ceases. When the Group loses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and any related non-controlling interest and other components of equity. Any resulting gain or loss is recognised in profit or loss. Any interest retained in the former subsidiary is measured at fair value when control is lost. The acquisition method of accounting is used to account for business combinations by the Group (refer to note 2(g)). Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset (ii) Joint Ventures The Group's interests in equity-accounted investees comprise interests in a joint venture. Interests in the joint venture are accounted for using the equity method. They are initially recognised at cost, which includes transaction costs. Subsequent to initial recognition, the consolidated financial statements include the Group's share of the profit or loss and OCI of equity-accounted investees, until the date on which significant influence or joint control ceases. (c) Foreign currency translation (i) Functional and presentation currency

transferred.

Items included in the consolidated financial statements of each of the Group's entities are measured using the currency of the primary economic environment in which it operates ('the functional currency'). The consolidated financial statements are presented in Australian dollars, which is Inghams Group Limited's functional and presentation

currency.

(ii) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation, at period end exchange rates, of monetary assets and liabilities denominated in foreign currencies, are recognised in consolidated income statement, except when they are deferred in equity as qualifying cash flow hedges and qualifying net investment hedges or are attributable to part of the net investment in a foreign operation. (iii) Group companies The results and financial position of foreign operations of the Group (none of which has the currency of a hyperinflationary economy), that have a functional currency different from the presentation currency are translated into the presentation currency as follows • Assets and liabilities for the statement of financial position are translated at the closing rate at balance date, • Income and expenses for each income statement and statement of comprehensive income are translated at average exchange rates, and • All resulting exchange differences are recognised in other comprehensive income.

2 Summary of significant accounting policies (continued)

(d) Revenue recognition Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances, rebates and amounts collected on behalf of third parties. The Group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the Group's activities as described below. The Group bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement. Revenue is recognised for the major business activities: (i) Sale of goods A sale is recorded when goods have been dispatched to a customer pursuant to a sales order and the associated risks have passed to the carrier or customer. (ii) Dividends Dividends are recognised as revenue when the right to receive payment is established. This applies even if they are paid out of pre-acquisition profits. (e) Income tax The income tax expense or revenue for the period is the tax payable on the current period's taxable income based on the

applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the company's subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. Deferred tax liabilities are not recognised for temporary differences between the carrying amount and tax bases of investments in foreign operations where the company is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future. Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

2 Summary of significant accounting policies (continued) (e) Income tax (continued) Current and deferred tax is recognised in the consolidated income statement, except to the extent that it relates to items recognised in other comprehensive income. In this case, the tax is also recognised in other comprehensive income.

Tax consolidation legislation Inghams Group Limited, the ultimate Australian controlling entity, and its subsidiaries, have implemented the tax consolidation legislation. Inghams Group Limited and its subsidiaries in the tax consolidated Group account for their own current and deferred tax amounts. These tax amounts are measured as if each entity in the tax consolidated Group continues to be a stand-alone taxpayer in its own right. In addition to its own current and deferred tax amounts, Inghams Group Limited, the ultimate Australian controlling entity, also recognises the current tax liabilities (or assets) and the deferred tax assets arising from

unused tax losses and unused tax credits assumed from subsidiaries in the tax consolidated Group. Assets or liabilities arising under tax funding arrangements within the tax consolidated entities are recognised as amounts receivable from or payable to other entities in the Group. Under the tax funding arrangement the members of the tax consolidated Group compensate Inghams Group Limited for any current tax payable assumed, and are compensated by Inghams Group Limited for any current tax receivable and deferred tax assets relating to unused tax losses or unused tax credits that are transferred to Inghams Group Limited.

(f) Leases Leases of property, plant and equipment where the Group, as lessee, has substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lease's inception at the fair value of the leased property or, if lower, the present value of the minimum lease payments. The corresponding rental obligations, net of finance charges, are included in borrowings. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to the profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The property, plant and equipment acquired under finance leases is depreciated over the asset's useful life. Leases in which a significant portion of the risks and rewards of ownership are not transferred to the Group as lessee are classified as operating leases. Payments made under operating leases are charged to profit and loss on a straight-line basis over the period of the lease. Lease income from operating leases where the Group is a lessor is recognised in income on a straight-line basis over the lease term. The respective leased assets are included in the balance sheet based on their nature. (g) Business combinations and goodwill

The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the fair values of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred also includes the fair value of any asset or liability resulting from a contingent consideration arrangement and the fair value of any pre-existing equity interest in the subsidiary. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. The excess of the consideration transferred and the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the subsidiary acquired and the measurement of all amounts has been reviewed, the difference is recognised directly in consolidated income statement as a bargain purchase.

2 Summary of significant accounting policies (continued) (g) Business combinations and goodwill (continued) Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entity's incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions. Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are

subsequently remeasured to fair value with changes in fair value recognised in consolidated income statement. (h) Impairment of assets Assets are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash generating units). Non financial assets that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period. (i) Cash and cash equivalents For the purpose of presentation in the consolidated statement of cash flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short term and highly liquid investments with maturities of three months or less from inception date, that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. (j) Trade receivables Trade receivables are recognised initially at fair value and subsequently measured at amortised cost, less provision for impairment. Trade receivables are generally collected within 30 days of invoice date. Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off by reducing the carrying amount directly. An allowance account (provision for impairment of trade receivables) is used when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 30 days overdue) are considered indicators that the trade receivable is impaired.

The amount of the provision is recognised in the consolidated income statement within selling expenses. (k) Biological assets Biological assets are recognised at cost less accumulated depreciation. The fair value of biological assets cannot be reliably measured, as quoted market prices are not available and it is difficult to estimate the fair value based on the eventual sales price. Depreciation of breeder chickens occurs on an egg-laying basis with the depreciation representing a portion of the egg cost and subsequently the day old broiler cost. Biological assets are reclassified as inventory once processed. (l) Inventories Poultry, feed and other classes of inventories are stated at the lower of cost and net realisable value. Cost comprises all overheads except selling, distribution, general administration and interest. Net realisable value is the estimated selling price in the ordinary course of business less the estimate costs of completion and the necessary costs to make the sale.

2 Summary of significant accounting policies (continued) (m) Financial instruments A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity

instrument of another entity. (i) Financial assets Initial recognition and measurement Financial assets are classified, at initial recognition, as financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, available for sale (AFS) financial assets, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Group commits to purchase or sell the asset. Subsequent measurement For purposes of subsequent measurement, financial assets are classified in four categories: • Financial assets at fair value through profit or loss • Loans and receivables • Held-to-maturity investments • Available for sale (AFS) financial assets Financial assets at fair value through profit or loss This category generally applies to derivative financial instruments. For more information on derivative financial instruments, refer to Note 16. Loans and receivables This category generally applies to trade and other receivables. For more information on receivables, refer to Note 8.

Derecognition

• A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e., removed from the Group's consolidated statement of financial position) when: • The rights to receive cash flows from the asset have expired; or • The Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a 'pass-through' arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset. (ii) Financial liabilities Initial recognition and measurement Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate.

2 Summary of significant accounting policies (continued) (m) Financial instruments (continued) (ii) Financial liabilities (continued) All financial liabilities are recognised initially at fair value and, in the case of borrowings and payables, net of directly

Derecognition

attributable transaction costs. The Group's financial liabilities include trade and other payables, borrowings and derivative financial instruments. A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss. (iii) Offsetting of financial instruments Financial assets and financial liabilities are offset and the net amount is reported in the consolidated statement of financial position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously. (n) Derivatives and hedging activities Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured to their fair value at the end of each reporting period. The accounting for subsequent changes in fair value depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. The Group designates certain derivatives as either: • Hedges of the fair value of recognised assets or liabilities or a firm commitment (fair value hedges) or • Hedges of a particular risk associated with the cash flows of recognised assets and liabilities and highly probable forecast transactions (cash flow hedges). The Group documents at the inception of the hedging transaction the relationship between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions. The Group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used

in hedging transactions have been and will continue to be highly effective in offsetting changes in fair values or cash flows of hedged items. The fair values of various derivative financial instruments used for hedging purposes are disclosed in note 17. Movements in the hedging reserve in shareholders' equity are shown in note 16. Movements in the hedging reserve in shareholders' equity are shown in note 19(a). The full fair value of a hedging derivative is classified as a non-current asset or liability when the remaining maturity of the hedged item is more than 12 months; it is classified as a current asset or liability when the remaining maturity of the hedged item is less than 12 months.

(i) Fair value hedges Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in comprehensive income statement, together with any changes in the fair value of the hedge asset or liability that are attributable to the hedged risk. The gain or loss relating to the effective portion of interest rate swaps and hedging fixed rate borrowings is recognised in the comprehensive income statement within finance costs, together with changes in the fair value of the hedged fixed rate borrowings attributable to interest rate risk. The gain or loss relating to the ineffective portion is recognised in comprehensive income statement within other income or other expenses. If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of a hedged item for which the effective interest method is used is amortised to the consolidated income statement over the period to maturity using a recalculated effective interest rate.

2 Summary of significant accounting policies (continued) (n) Derivatives and hedging activities (continued) (ii) Cash flow hedges

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in other comprehensive income and accumulated in reserves in equity. The gain or loss relating to the ineffective portion is recognised immediately in comprehensive income statement within other income or other expense. Amounts accumulated in equity are reclassified to the comprehensive income statement in the periods when the hedged item affects profit or loss. The gain or loss relating to the effective portion of interest rate swaps hedging variable rate borrowings is recognised in profit or loss within 'finance costs'. The gain or loss relating to the effective portion of forward foreign exchange contracts hedging export sales is recognised in profit or loss within 'sales'. However, when the forecast transaction that is hedged results in the recognition of a non-financial asset, the gains and losses previously deferred in equity are reclassified from equity and included in the initial measurement of the cost of the asset. The deferred amounts are ultimately recognised in profit or loss as cost of goods sold in the case of inventory, or as depreciation or impairment in the case of fixed assets. When a hedging instrument expires or is sold or terminated, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in profit or loss. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately reclassified to profit or loss. The Group may also enter into derivative contracts in order to hedge the translation of results of its New Zealand business. As this result is an uncertain amount at the date the derivative is entered into, it is not eligible for designation as a hedging instrument under Australian Accounting Standards, and as such any applicable contracts are measured at fair value through profit or loss, with gains or losses being recognised in profit or loss in the period incurred. (o) Property, plant and equipment Freehold land and buildings are shown at fair value based on formal periodic valuations (with sufficient regularity to ensure materially accurate valuations reflected) by external independent valuers, less subsequent depreciation for buildings. Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset and the net amount is restated to the revalued amount of the asset. All other property, plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Cost may also include transfers from equity of any gains or

losses on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment. Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred. Land is not depreciated. Depreciation on other assets is calculated using the straight-line method to allocate their cost or revalued amounts, net of their residual values, over their estimated useful lives as follows: Freehold land and buildings and leasehold buildings 3 - 50 years Plant and equipment 1 - 20 years Leased plant and equipment 5 - 15 years The assets' residual values and useful lives are reviewed and adjusted if appropriate, at the end of each reporting period. As asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount.

Freehold land and buildings and leasehold buildings	3 - 50 years
Plant and equipment	1 - 20 years
Leased plant and equipment	5 - 15 years

2 Summary of significant accounting policies (continued) (o) Property, plant and equipment (continued) Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss. When revalued assets are sold, it is Group policy to transfer any amounts included in other reserves in respect of

those assets to retained earnings. (p) Assets classified as held for sale Assets classified as held for sale are stated at the lower of their carrying amount and fair value less costs to sell if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. An impairment loss is recognised for any initial or subsequent write-down of the asset to fair value less costs to sell. Assets are not depreciated or amortised while they are classified as held for sale. (q) Investments Investments in subsidiaries and joint venture entities are accounted for at cost. Dividends received from subsidiaries and joint venture entities are recognised in the parent entity's profit, rather than being deducted from the carrying amount of these investments. (r) Trade and other payables These amounts represent liabilities for goods and services provided to the Group prior to the end of financial period which are unpaid. The amounts are unsecured and are usually paid within 45 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months from the reporting date. They are recognised

initially at their fair value and subsequently measured at amortised cost using the effective interest method. (s) Interest bearing liabilities Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds and the redemption amount is recognised in profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates. Borrowings are removed from the consolidated statement of financial position when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss as other income or finance costs. Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period. Borrowing costs incurred for the construction of any qualifying assets are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Other borrowing costs are expensed as incurred. (t) Provisions Provisions for make good obligations are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation and the amount has been reliably estimated. Provisions are not recognised for future operating losses. Provisions are measured at the present value of management's best estimate of the expenditure required to settle the present obligation at the end of each reporting period. The discount rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

2 Summary of significant accounting policies (continued) (t) Provisions (continued) Workers compensation provisions are determined by actuarial assessment every financial period. The provision represents

the expected liability of the entity in relation to each states self-insurance licence. (u) Employee benefits (i) Short-term obligations Liabilities for wages and salaries, including non monetary benefits, annual leave and accumulating sick leave expected to be settled wholly within 12 months after the end of the reporting period in which the employees render the related service are recognised in respect of employees' services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liability for annual leave and accumulating sick leave is presented as provision for employee benefits. All other short term employee benefit obligations are presented as payables.

(ii) Other long-term employee benefit obligations The liabilities for long service leave and annual leave which is not expected to be settled wholly within 12 months after the end of the reporting period in which the employees render the related service is recognised in the provision for employee benefits and measured as the present value of expected future payments to be made in respect of services provided by employees up to the end of the reporting period using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the end of the reporting period on corporate bonds with terms and currencies that match, as closely as possible, the estimated future cash outflows. The obligations are presented as current liabilities in the consolidated statement of financial position if the entity does not have an unconditional right to defer settlement for at least 12 months after the reporting period, regardless of when the actual settlement is expected to occur. (iii) Share-based payments Share-based compensation benefits are provided to directors and select key management under Long Term Incentive The fair value of shares granted under Long Term Management Incentive Plans are recognised as an employee benefits expense with a corresponding increase in equity, over the period in which the employees become unconditionally entitled to the shares. The total amount to be expensed is determined by reference to the fair value of the shares granted, which includes any market performance conditions and the impact of any non-vesting conditions but excludes the impact of any service and non-market performance vesting condition.

Plans.

Non-market vesting conditions are included in assumptions about the number of shares that are expected to vest. The total expense is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. At the end of each period, the entity revises its estimates of the number of shares that are expected to vest based on the non-market vesting conditions. It recognises the impact of the revision to original estimates, if any, in profit or loss, with a corresponding adjustment to equity. Where such adjustments results in a reversal of previous expenses these are recognised as a credit to profit and loss in the period that it is assessed that certain vesting conditions will not be met. (iv) Short term incentive scheme The Group recognises a liability and an expense for bonuses based on a formula that takes into consideration the earnings of the entity after certain adjustments. (v) Contributed equity Ordinary shares are classified as equity.

2 Summary of significant accounting policies (continued) (w) Dividends

Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the entity, on or before the end of the reporting period but not distributed at the end of the reporting period.

(x) Good and Services Tax (GST) Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the taxation authority, are presented as operating cash flows. Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the statement of financial position. Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part

of the expense. (y) Rounding of amounts The amounts contained in the financial report have been rounded to the nearest hundred thousand dollars (where rounding is applicable) where noted (\$000), or in certain cases, the nearest dollar, under the option available to the Company under ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument 2016/191. The Company is an entity to which this legislative instrument applies. (z) Parent entity financial information The financial information for the parent entity, Inghams Group Limited (formerly Ingham Holdings I Pty Limited), has been prepared on the same basis as the consolidated financial statements.

3 Segment information Description of segments Ingham's operations are all conducted in the poultry industry in Australia and New Zealand. The Group has identified its operating segments based on the internal reports that are reviewed and used by the CEO and the senior leadership team (the chief operating decision maker) in assessing performance and in determining the allocation of resources. The Group's operations in Australia and New Zealand are each treated as individual operating segments. The CEO and the senior leadership team monitor the operating results of business units separately, for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on earnings before interest, tax, depreciation and amortisation (EBITDA) and significant items. Inter-segment pricing is determined on an arm's length basis and inter segment revenue is generated from a royalty charge for the services provided by the Australian operation. One customer generated revenues in excess of 10% of Group revenue (2016: one).

Segment from	performance is evaluated based on earnings significant items. Inter-segment pricing is determined on a royalty charge for the services provided by the	before interest, tax, depreciation and an arm's length basis and inter Australian operation.	amortisation segment revenue	(EBITDA) and is generated
One	customer generated revenues in excess of 10% of Group	revenue (2016: one).
	Allocations of assets and liabilities are not separately	identified in internal reporting so are not	disclosed in this	note.
			New
2017		Australia \$000	Zealand \$000	Consolidated \$000
	Revenue
Segment	revenue	2,058,400	368,500	2,426,900
Other Inter	income segment revenue / expense	10,400 21,800	- (21,800)	10,400 -
		2,090,600	346,700	2,437,300
Adjusted	operating expenses*	(1,928,200)	(310,000)	(2,238,200)
EBIT		120,700	36,700	157,400
	Significant items and other	(39,500)	-	(39,500)
PBIT		81,200	36,700	117,900
				59,100
Share EBITDA Net Profit Tax Profit test blank *	of net profit of associates (Note 24) Depreciation and amortisation finance costs before tax expense after tax Adjusted operating expenses include cost of sales, amortisation.	700 163,100 (42,400) (40,700) 40,500 (18,100) 22,400 distribution, selling and administration, Australia \$000s	- 36,700 - - 36,700 - 36,700 excluding New Zealand \$000	700 199,800 (42,400) (40,700) 77,200 (18,100) depreciation and Consolidated \$000
test
Capital Total	expenditure property, plant and equipment	93,600 308,400	7,600 64,400	101,200 372,800
blank
Total	impairment losses	7,400	100	7,500

		New
	Australia	Zealand	Consolidated
	\$000s	\$000	\$000
test
blank

Inghams	Group Limited (formerly Notes to the consolidated	Ingham Holdings financial	I Pty Limited) statements
		As	at 1 July 2017
3 Segment information (continued)
		New
	Australia	Zealand	Consolidated
2016	\$000	\$000	\$000
Revenue
Segment revenue	1,955,300	353,400	2,308,700
Other income	3,600 22,900	- (22,900)	3,600 -
Inter segment revenue / expense	1,981,800	330,500	2,312,300
Adjusted operating expenses*	(1,852,600)	(294,000)	(2,146,600)
Share of net profit of associates (Note 24)	600	-	600
EBITDA Depreciation and amortisation	129,800 (27,800)	36,500 (5,500)	166,300 (33,300)
EBIT	102,000	31,000	133,000
Significant items and other	(60,800)	-	(60,800)
PBIT	41,200	31,000	72,200
Net finance costs	(39,700)	-	(39,700)
Profit before tax Tax expense	1,500 (7,300)	31,000 -	32,500 (7,300)
Profit after tax	(5,800)	31,000	25,200
test
blank
* Adjusted operating expenses include cost of sales, distribution, amortisation.	selling and administration,	excluding	depreciation and
test
Total capital expenditure Total property, plant and equipment	71,700 309,000	5,100 63,100	76,800 372,100
blank
Total impairment losses	3,900	-	3,900
4 Revenue
		2017 \$000	2016 \$000
Sale of goods
		2,138,700
Poultry
Feed		286,900	2,013,700 293,100

blank

test
blank amortisation.
test
blank
4 Revenue	2017 \$000	2016 \$000
Sale of goods
Poultry	2,138,700	2,013,700
Feed	286,900	293,100
	2,425,600	2,306,800
Space Other revenue
Other revenue	1,300	1,900
	2,426,900	2,308,700

	Inghams Group	Limited (formerly Ingham Holdings I	Pty Limited)
		Notes to the consolidated financial	statements
		As at	1 July 2017
5	Other Income and Expenses
(a)	Other Income
		2017	2016
Other		\$000	\$000
	gain on disposal of assets held for sale	6,900	3,300
	items Net Other	3,500	300
		10,400	3,600

		2017 \$000	2016 \$000
	Other	3,500	300
		10,400	3,600
properties	are at market rates and as such no adjustment to the gain in the year of	disposal is required.	Leased back
properties	have lease periods of 3-20 years with various renewal options available to the	Group as defined in	the sale and
leaseback	agreements. The properties are required to be used for their current purposes	being a hatchery and	a feedmill.
(b)	Expenses
Employee	benefits expenses
	Employee benefits expense	562,300	543,100
	Defined super contributions	37,700	36,400
	Share-based payment expense	4,600	3,400
		604,600	582,900
	Impairment losses
	Trade receivables	1,600	800
	Inventories	5,900	3,100
on	Impairment losses on trade receivables are recognised within administration and selling inventories are recognised within cost of sales.	expenses, and	impairment losses
Rental	expense related to operating leases	77,100	60,700
Net	loss on disposal of property, plant and equipment	-	100
(c)	Other
	Significant items
	Transformation costs	4,400	19,300
	Relocation of head office	1,700	25,400
	Site closure costs	-	14,900
	Initial Public Offering (IPO) transaction costs	28,000	-
	Pre - IPO LTIP	4,200	-
	Monitoring fees paid to former ultimate parent entity	1,200	1,200
		39,500	60,800
	Transformation costs
	Transformation costs relate primarily to consultant costs incurred relating to realignment	of strategy and	processes.

5 Other Income and Expenses (continued) (c) Other (continued) Relocation of Head Office Ingham's relocated its corporate head office from Liverpool to North Ryde resulting in costs related to employee redundancies and lease obligations. Site closure costs On 3 June 2016 the business announced the planned closure of the Cardiff processing plant resulting in employee termination costs, supplier contract obligations and asset impairments.

	redundancies and lease obligations.
Site On 3	closure costs June 2016 the business announced the planned closure of the termination costs, supplier contract obligations and asset impairments.	Cardiff processing plant resulting	in employee
Initial Costs bonuses	public offering transaction costs incurred to complete the IPO transaction, including legal, accounting of \$8.0m paid to key management personnel.	and advisor fees, consultant costs	and executive
(d)	Finance income and costs
		2017	2016
		\$000	\$000
Interest	Income	(1,100)	(2,200)
Interest	and borrowing costs	23,800	39,800
	Amortisation / Write off of borrowing costs*	7,300	2,100
Interest	rate swap break costs **	10,700 40,700	- 39,700
*	Includes \$6.5m which relates to expensing of capitalised borrowing costs debt due to IPO transaction.	associated with the re-financing	of existing
**	Break costs due to refinancing debt.
6	Income tax expense
		2017 \$000	2016 \$000
(a)	Income tax expense

		2017 \$000	2016 \$000
6	Income tax expense	2017	2016
(a)	Income tax expense	\$000	\$000
Current	tax	15,700	10,600
Deferred	tax	2,500	(4,300)
	Adjustments for current tax of prior periods	(100) 18,100	1,000 7,300

		Inghams	Group Limited	(formerly	Ingham Holdings I	Pty Limited)
				Notes to the	consolidated financial As	statements at 1 July 2017
6	Income tax expense (continued)
(b)	Numerical reconciliation of income	tax expense	to prima facie	tax payable
Profit Giant	from continuing operations before income white space	tax expense			77,200	32,500
Tax	at the Australian tax rate of 30% (2016 -	30%)			23,200	9,800
Tax	effect of amounts which are not deductible	(taxable) in	calculating
taxable	income: Non-deductible expenses				1,700	2,600
	R&D tax offset				(300)	(400)
	Revaluation of inventory tax base in associate				(300) 24,300	(100) 11,900
Space
Net	tax differential and legislative adjustment	of overseas	operations		(5,600)	(5,000)
	Difference in overseas tax rates				(500) (100)	(600) 1,000
Income	Adjustments for current tax of prior periods tax expense				18,100	7,300
White	space
(c)	Deferred taxes
The	movements in deferred tax balances for the	Group are shown	in the tables	below:
		Opening	Charged to	Charged to	Exchange	Closing
		Balance	income	equity	differences	balance
		\$000	\$000	\$000	\$000	\$000
2017
Doubtful	debts Employee benefits	- 23,700	400 (1,200)	- -	- -	400 22,500
Cash	flow hedges	4,300	-	(3,800)	-	500
IPO	related expenditure		- 3,900	1,900	-	5,800
Other	accruals	3,600	(200)	-	-	3,400
	Provisions	7,400	(6,000)	-	-	1,400

				24,300	11,900
Space
	Opening	Charged to	Charged to	Exchange	Closing
	Balance \$000	income \$000	equity \$000	differences \$000	balance \$000
2017
Doubtful debts	-	400	-	-	400
Employee benefits	23,700	(1,200)	-	-	22,500
Cash flow hedges	4,300	-	(3,800)	-	500
IPO related expenditure		- 3,900	1,900	-	5,800
Other accruals	3,600	(200)	-	-	3,400
Provisions	7,400	(6,000)	-	-	1,400
Property, plant and equipment	(7,000)	(300)	-	-	(7,300)
Inventories	(38,800)	900	-	-	(37,900)
Net deferred tax liabilities	(6,800)	(2,500)	(1,900)	-	(11,200)
	Opening	Charged to	Charged to	Exchange	Closing
	Balance	income	equity	differences	balance
	\$000	\$000	\$000	\$000	\$000
2016
Doubtful debts	100	(100)	-	-	-
Employee benefits	23,700	(100)	-	100	23,700
Cash flow hedges	2,500	-	1,800	-	4,300
Other accruals	1,600	2,000	-	-	3,600
Provisions	-	7,400	-	-	7,400
Property, plant and equipment	2,200	(1,600)	(7,500)	(100)	(7,000)
Inventories	(35,400)	(3,300)	-	(100)	(38,800)
	(5,300)	4,300	(5,700)	(100)	(6,800)
Net deferred tax (liabilities)/assets

Inghams Group	Limited (formerly Ingham Holdings I Notes to the consolidated financial	Pty Limited) statements
	As at	1 July 2017
7 Cash and cash equivalents
	2017	2016
	\$000	\$000
space Current assets
Cash at bank and on hand	148,400	74,700
Short-term deposits	600	600
	149,000	75,300
Term deposits are presented as cash equivalents as they have a maturity	of less than three months.
8 Trade and other receivables
	2017	2016
	\$000	\$000
space Trade receivables	205,200	211,500

		2017	2016
space		\$000	\$000
		149,000	75,300
8	Trade and other receivables
		2017	2016
		\$000	\$000
space Trade	receivables	205,200	211,500
Allowance	for doubtful debts	(1,400)	(100)
		203,800	211,400
Other	receivables	12,300	4,100
	Prepayments	14,300 230,400	5,800 221,300
Movement	in the allowance for doubtful debts:
At start	of period	(100)	(400)
Impairment	expense recognised during the year	(1,600)	(800)
Receivables	written off during the year as uncollectable	300	1,100
Balance	at end of period	(1,400)	(100)
Due to	the short-term nature of current receivables, their carrying amount is	assumed to approximate their fair	value.
The recognised	Group has considered the collectability and recoverability of trade for the specific irrecoverable trade receivable amounts. The ageing	receivables. An allowance for of trade receivable is outlined	doubtful debt is below:
		2017 \$000	2016 \$000
Current		190,900	161,800
1 to 30		9,400	48,200

At start of period	(100)	(400)
Impairment expense recognised during the year	(1.600)	(800)
Receivables written off during the year as uncollectable	300	1.100
Balance at end of period	(1.400)	(100)

	203,800	211,400
Prepayments	14,300	5,800
	230,400	221,300
	2017	2016
	\$000	\$000
Current	190,900	161,800
1 to 30	9,400	48,200
31 to 60	1,700	700
61 to 90	1,100	200
90+	700	500
Impaired	1,400 205,200	100 211,500

	Inghams Group Limited (formerly	Ingham Holdings I	Pty Limited)
	Notes to the	consolidated financial As at	statements 1 July 2017
9	Biological assets
		2017 \$000	2016 \$000
Breeder Broiler		40,100 63,100	38,500 65,000
Eggs		11,400 114,600	11,800 115,300
All business.	movements in the value of biological asset classes are due to purchases and	consumption in the ordinary	course of
The	Group is exposed to a number of risks relating to its biological assets:
(i)	Regulatory and environmental risk
	The Group is subject to laws and regulations in the countries in which it operates. environmental policies and procedures aimed at compliance with local environmental	The Group has established and other laws.
(ii)	Climate and other risks
	The Group's biological assets are exposed to the risk of damage from climatic forces. The Group has extensive processes in place aimed at monitoring and regular health inspections. The Group is also insured against natural disasters.	changes, diseases and mitigating those risks,	other natural including
10	Inventories
		2017 \$000	2016 \$000
Processed Feed	Poultry	103,300 35,700	99,900 42,800
Other		24,600	22,500

Eggs business.		114,600
			115,300
10	Inventories
		2017 \$000	2016 \$000
Processed	Poultry	103,300	99,900
Feed		35,700	42,800
Other		24,600	22,500
		163,600 (5,800)	165,200 (5,600)
Net	realisable value adjustment	157,800	159,600
Other	inventories include medication, packaging and consumables.
11	Assets classified as held for sale
		2017 \$000	2016 \$000
Assets	classified as held for sale	46,400	1,200

2017 \$000	2016 \$000

			Inghams	Group Limited Notes	(formerly Ingham to the consolidated	Holdings I financial As at	Pty Limited) statements 1 July 2017
12 Property, plant	and equipment
	Freehold land \$000	Freehold Buildings \$000	Leasehold buildings \$000	Plant and equipment \$000	Leased plant and equipment \$000	Capital work in progress \$000	Total \$000
2016
Cost Opening balance	47,800	24,600	5,000	271,000	9,400	13,200	371,000
Additions Transfers	- 500	- -	- 2,000	- 46,500	600 -	76,200 (49,000)	76,800 -
Assets held for sale Revaluation	- 19,300	400 5,100	- -	(100) -	- -	- -	300 24,400
Disposals	-	-	-	(300)	-	-	(300)
Exchange differences Closing Balance	300 67,900	700 30,800	500 7,500	4,100 321,200	(100) 9,900	100 40,500	5,600 477,800
Accumulated
Depreciation Opening balance	-	(2,200)	400	(64,500)	(4,400)	-	(70,700)
Depreciation charge	-	(500)	(300)	(31,100)	(1,400)	-	(33,300)
Impairment Revaluation write back	- -	(1,000) 2,200	- -	(1,600) -	- -	- -	(2,600) 2,200
Disposals	-	-	-	200	-	-	200
Exchange differences Net book amount	-	800 - (700)	(800) (700)	(1,500) (98,500)	- (5,800)	- -	(1,500) (105,700)
Total carrying amount	67,900	30,100	6,800	222,700	4,100	40,500	372,100
2017
Cost Opening balance	67,900	30,800	7,500	321,200	9,900	40,500	477,800
Additions Transfers	- 1,000	- 2,200	- -	3,700 87,700	- -	97,500 (90,900)	101,200 -
Assets held for sale	(44,800)	(11,000)	-	(4,200)	-	-	(60,000)
Disposals	- -	- -	- -	(300) (200)	- -	- -	(300) (200)
Exchange differences Closing Balance	24,100	22,000	7,500	407,900	9,900	47,100	518,500
Accumulated Depreciation
Opening balance	-	(700)	(700)	(98,500)	(5,800)	-	(105,700)
Depreciation charge Assets held for sale	- -	(600) 1,100	(400) -	(39,700) 1,200	(1,700) -	- -	(42,400) 2,300
Disposals	-	-	-	100	-	-	100
Net book amount		- (200)	(1,100)	(136,900)	(7,500)	-	(145,700)
Total carrying amount	24,100	21,800	6,400	271,000	2,400	47,100	372,800

12 Property, plant and equipment (continued) The valuation basis of freehold land and buildings is fair value being the amounts for which the assets could be exchanged between willing parties in an arm's length transaction, based on current prices in an active market for similar properties in the same location and condition. An independent valuation was performed during the prior year and asset values were adjusted as at 25 June 2016 and are still relevant so no revaluation has been considered necessary in the current year. Had the land and buildings not been historically revalued, the carrying value of freehold land and buildings would have been \$5.0m less at 1 July 2017 (2016: \$26.6m less). 13 Trade and other payables

Trade and other payables 2017 2016 Current Non-Current Total Current Non-Current Total
13
\$000				\$000	\$000	\$000		\$000	\$000
Trade payables 230,300 2,000 232,300 216,500 2,700 219,200 Factored trade payables 17,100 - 17,100 - - - 22,900 - 22,900 23,300 - 23,300 Other payables
270,300 2,000 272,300 239,800 2,700 242,500
	nature.	Factored trade	payables have	extended payment	terms and	are interest	bearing.
14 Borrowings			2017 \$000	amount 2016 \$000	Principal		2016 \$000	rate	Maturity
(a) Interest bearing loans Carrying amount drawn Interest 2017 \$000	Secured Tranche Tranche blank	liabilities A B	- -	111,200 390,300		- -	112,800 396,000	Floating Floating	N/A N/A

				2017			2016
			Current \$000	Non-Current \$000	Total \$000	Current \$000	Non-Current \$000	Total \$000
			270,300	2,000	272,300	239,800	2,700	242,500
(a)	Interest bearing	loans
			Carrying amount	Principal	amount	drawn	Interest rate	Maturity
		2017	2016		2017	2016
		\$000	\$000		\$000	\$000
Secured Tranche	liabilities A	-	111,200		-	112,800	Floating*	N/A
Tranche	B	-	390,300		-	396,000	Floating*	N/A
blank
test	Unsecured liabilities
Tranche	A	249,200	-		250,000	-	Floating*	November 2019
Tranche	B	169,400	-		170,000	-	Floating*	November 2020
Tranche	C	30,000	-		30,000	-	Floating*	November 2019
Loan		- 448,600	40,000 541,500		- 450,000	40,000 548,800	10%	N/A
blank blank
*	Floating rates are	at Bank Bill	Swap Rate plus	a predetermined	margin.	The Group	has entered	into hedging of the
	floating interest	rate, as further	described from	page 86.
In	November 2016, the	Group	refinanced its loan	facility with a	domestic bank	syndicate for	the provision	of debt financing
of up	to \$545.0 million	(in aggregate),	comprising	three senior	unsecured	facilities (Syndicated	Facility	Agreement). Funding
provided	under the	new Syndicated	Facility	Agreement was	partly used to	repay the	Group's existing	loan facilities of
\$570.3	million and	associated	derivative transactions,	transactions	costs	associated with	the IPO and	to fund working
capital.	As a result	of the refinance,	\$6.5 million	of borrowing	costs	previously capitalised	were	written off to the
	Consolidated Income	Statement	(refer to Note 5(d)).
								70

14 Borrowings (continued) (b) Fair value For external borrowings, the fair values are not materially different to their carrying amounts, since the interest payable on the borrowings is either close to current market rates or the borrowings are of a short-term nature. The Group has entered

14	Borrowings (continued)
(b)	Fair value
For the into	external borrowings, the fair borrowings is either close to interest rate swaps in relation	values are not current market to the interest	materially different rates or the borrowings payable.	to their carrying are of a	amounts, short-term	since the interest nature. The Group	payable on has entered
15	Provisions
		Current \$000	2017 Non-Current \$000	Total \$000	Current \$000	2016 Non-current \$000	Total \$000
Workers	compensation
	Queensland New South Wales	1,600 1,200	4,600 4,200	6,200 5,400	2,500 1,300	4,000 3,900	6,500 5,200
	South Australia	1,500	3,000	4,500	2,700	2,900	5,600
	Victoria	1,700	4,400	6,100	1,400	3,500	4,900
	Western Australia Tasmania	700	1,000 100 100	1,700 200	800 200	100 300	900 500
		6,800	17,300	24,100	8,900	14,700	23,600
Employee	benefits	66,100	10,000	76,100	61,200	19,300	80,500
Make Onerous	good provision provision	- 1,800	9,900 -	9,900 1,800	- 6,200	9,900 -	9,900 6,200
	Restructuring provision	2,600	-	2,600	16,900	-	16,900
Other	provisions	-	-	-	100	200	300
		70,500 77,300	19,900 37,200	90,400 114,500	84,400 93,300	29,400 44,100	113,800 137,400
(a)	Workers compensation
Workers Principle incurred and	compensation provisions of WSA Financial Consulting considering the liability for reported but not reported as at investment earnings on the claims	are determined Pty Limited claims still balance date and provision.	by actuarial and Mr Bruce outstanding, settled a provision for	assessment by Harris, claims that future expenses,	Mr William BEng(Hons) FIAA may be adjustments	Szuch Bsc, BA, Consultant of reopened in the for claims cost	MBA, FIA. FIAA am actuaries, future, claims escalation
(b)	Make good provision
The terms. the	Group is required to restore A provision has been recognised improvements. These costs have shorter of the term of the lease	certain leased for the been capitalised or the useful	premises to their present value of as part of the life of the assets.	original the estimated cost of leasehold	condition at the expenditure improvements	end of the required to remove and are	respective lease leasehold amortised over
(c)	Restructuring provision
Provisions valid directly provision reported	for restructuring are expectation has been raised to caused by the restructuring is reviewed regularly and in the period in which the	recognised when those persons and does not adjusted if revision in the	a detailed formal affected. The include costs required. Revisions estimate occurs.	plan has provision is based associated with in the estimated	been approved on expenditure ongoing amount of	and either to be incurred activities. The a restructuring	commenced or a which is adequacy of the provision are

valid expectation has been raised to those persons affected. The provision is based on expenditure to be incurred which is directly caused by the restructuring and does not include costs associated with ongoing activities. The adequacy of the provision is reviewed regularly and adjusted if required. Revisions in the estimated amount of a restructuring provision are reported in the period in which the revision in the estimate occurs.

15 Provisions (continued) (d) Onerous provision During the prior year the Group recognised a provision in recognition of remaining lease term on a building that is not expected to be utilised due to relocation of its corporate office. The provision represents present value of future minimum lease payments less expected income from subleasing. Additionally the provision also includes amounts for terminating supplier contracts where no economic benefits will be realised. (e) Movements

expected to be utilised due to relocation of its corporate office. The provision represents present value of future minimum payments less expected income from subleasing. Additionally the provision also includes amounts for terminating supplier contracts where no economic benefits will be realised. Movements Movements in each class of provision during the financial year, other than employee benefits, are set out below: Workers Make good Onerous Compensation provisions provision Restructuring Other Total \$000 \$000 \$000 \$000 \$000 \$000 Balance at 28 June 2015 24,500 9,400 - - - 33,900 Charged to profit or loss 10,500 500 6,200 16,900 300 34,400 Amounts used during the (11,400) - - - - (11,400) period 23,600 9,900 6,200 16,900 300 56,900 Balance at 25 June 2016 Balance at 25 June 2016 23,600 9,900 6,200 16,900 300 56,900 Charged to profit or loss 17,400 - - 2,400 - 19,800 Amounts used during the (16,900) - (4,400) (16,700) (300) (38,300) period 24,100 9,900 1,800 2,600 - 38,400 Balance at 1 July 2017
	lease
	(e)
16 Derivative financial instruments				2017			2016
The Group has the following derivative financial instruments:			Current \$000	Non-Current \$000	Total \$000	Current \$000	Non-Current \$000	Total \$000
		rate swap
Interest contracts	-	flow hedges	-	300	300	-	-	-
Cash (asset)	- Cash (liability)	flow hedges	(700)	-	(700)	(5,700)	(6,500)	(12,200)

period	(11,400)		- -		- -	(11,400)
period	(16,900)		- (4,400)	(16,700)	(300)	(38,300)
		2017			2016
	Current \$000	Non-Current \$000	Total \$000	Current \$000	Non-Current \$000	Total \$000
Interest rate swap contracts - Cash flow hedges
(asset)	-	300	300	-	-	-
- Cash flow hedges (liability)	(700)	-	(700)	(5,700)	(6,500)	(12,200)
Forward foreign exchange contracts - Cash flow hedges
	100	-	100	-	-	-
(asset)
- Cash flow hedges (liability)	(1,500)	-	(1,500)	(2,200)	-	(2,200)

16 Derivative financial instruments (continued) Classification of derivatives

Derivatives are classified as held for trading and accounted for at fair value through profit or loss unless they are designated as hedges. They are presented as current assets or liabilities if they are expected to be settled within 12 months after the end of the reporting period. The Group's accounting policy for its cash flow hedges is set out in note 2(n). For hedged forecast transactions that result in the recognition of a non-financial asset, the Group has elected to include related hedging gains and losses in the initial measurement of the cost of the asset. 17 Equity

The the	Group's accounting policy for its cash flow hedges recognition of a non-financial asset, the Group measurement of the cost of the asset.	is set out in note has elected to include	2(n). For hedged related hedging	forecast transactions gains and losses	that result in in the initial
17	Equity
	Contributed equity
(a)	Share capital
		2017 Shares	2016 Shares	2017 \$000	2016 \$000
	Ordinary shares issued	380,243,196	334,115,281	262,000	107,800
(b)	Movements in ordinary shares
				Shares	\$000
space! Balance	at 28 June 2015			327,038,914	106,500
Shares	issued, net of transaction costs			7,076,367 334,115,281	1,300 107,800
Balance Shares	at 25 June 2016 issued, net of transaction costs			49,587,815	154,200
Share	buyback			(3,459,900)	-
Balance	at 1 July 2017			380,243,196	262,000
	Transaction costs of \$6.4 million, after tax, were	charged to share capital	during FY17.
(c)	Ordinary shares
Ordinary	shares entitle the holder to participate in proportion to the number of and amounts paid on	dividends and to share the shares held.	the proceeds	on winding up of the	company in
On a upon	show of hands every holder of ordinary shares a poll each share is entitled to one vote.	present at a meeting	in person or by	proxy, is entitled to	one vote, and
Ordinary	shares have no par value and the company	does not have a limited	amount of	authorised capital.
(d)	Treasury shares
Treasury trust during	shares outstanding of 8,238,541 shares by Ingham 2 Pty Limited, a subsidiary, for Information relating to the Ingham's Long Term the financial period and outstanding at the	(2016: 25,339,294) are the purpose of Incentive Plan, including end of the reporting	shares in Inghams issuing shares under details of shares period, is set out in	Group Limited that the employee issued, exercised note 20.	are held in share scheme. and lapsed

	Inghams Group Limited (formerly Notes to the	Ingham Holdings I consolidated financial As at	Pty Limited) statements 1 July 2017
18	Dividends
(a)	Ordinary shares
		2017 \$000	2016 \$000
Fully	franked interim dividend paid in year of 2.6 cents per share	9,900	-
The October dividend financial	directors propose that a final dividend of 9.5 cents per ordinary share be declared on 21 2017. The proposed FY17 final dividend will be fully franked for Australian tax has not been brought to account in these consolidated financial statements and reports.	August 2017, and purposes. The financial will be recognised in	be paid on 4 effect of this subsequent
	Franking credits
(b)		32,400	43,400
Amount Limited	of Australian franking credits available to the shareholders of Inghams Group
The	ability to utilise the franking credits is dependent upon the ability to declare dividends in	the future.

Limited	32,400	43,400

19	Reserves
(a)	Other reserves
		2017	2016
		\$000	\$000
Asset	revaluation reserve	16,700	20,300
Foreign	currency translation reserve	11,600	11,800
Cash	flow hedge reserve Share-based payments reserve	(1,200) 9,200	(10,000) 4,600
	Acquisition reserve	6,700	6,700
		43,000	33,400
	Movements:
Asset	revaluation reserve
	Balance at beginning of financial period	20,300	-
	Revaluation gain	-	27,800
	Deferred tax	-	(7,500)
	Transfer to retained earnings	(3,600)	-
	Balance at end of the period	16,700	20,300

Movements:

		2017	2016
		\$000	\$000
		43,000	33,400
	Movements:
Asset	revaluation reserve
	Balance at beginning of financial period	20,300	-
	Revaluation gain	-	27,800
	Deferred tax	-	(7,500)
	Transfer to retained earnings	(3,600)	-
	Balance at end of the period	16,700	20,300
Foreign	currency translation reserve
	Balance at beginning of financial period	11,800	3,700
	Currency translation differences arising during the period	(200)	8,100
	Balance at end of financial period	11,600	11,800
Cash	flow hedges reserve
	Balance at beginning of financial period	(10,000)	(5,800)
	Balance reclassified to profit and loss in period	10,000	-
	Revaluation - gross	(1,700)	(6,000)
	Deferred tax	500	1,800
	Balance at end of financial period	(1,200)	(10,000)
	Share-based payment reserve
	Balance at beginning of financial period	4,600	1,200
	Share based payment expense	4,600	3,400
	Balance at end of the period	9,200	4,600
	Acquisition reserves
	Balance at beginning and end of the period	6,700	6,700
	Balance at end of financial year	6,700	6,700

19 Reserves (continued) (b) Nature and purpose of other reserves (i) Asset revaluation reserve The asset revaluation reserve is used to record increments and decrements on the revaluation of non-current assets, as described in note 12. The balance standing to the credit of the reserve may be used to satisfy the distribution of bonus shares to shareholders and is only available for the payment of cash dividends in limited circumstances as permitted by law. (ii) Foreign currency translation Exchange differences arising on translation of the foreign controlled entity are recognised in other comprehensive income as described in note 2(c) and accumulated in a separate reserve within equity. The cumulative amount is reclassified to profit or loss when the net investment is disposed of. (iii) Cash flow hedges The hedging reserve is used to record gains or losses on a hedging instrument in a cash flow hedge that are recognised in other comprehensive income, as described in note 2(n). Amounts are reclassified to profit or loss when the associated hedged transaction affects profit or loss. (iv) Share-based payments The share-based payments reserve is used to recognise the grant date fair value of shares issued to employees but not (v) Acquisition reserve The acquisition reserve is used to recognise pre-acquisition foreign currency translation gains not eliminated through the recognition of the business combination in accordance with Australian Accounting Standards.

vested.

20 Share-based payments Ingham's Employees Share Plan (Pre-IPO) Select employees of the Group have been granted an interest-free loan to subscribe to shares of Inghams Group Limited. This loan is non-recourse other than to the shares held by that employee, and the proceeds of the loan must be used to buy shares. As the only recourse on the loans is the shares and there are vesting conditions, the arrangement has been accounted for as share options, as required under accounting standards. These options entitle the holders to receive dividend on ordinary shares of the Company, and these dividends are required to be used to repay the loans described above. The shares vest based on earnings and length of service as follows: (a) Performance based - which only vest if certain performance standards are met (b) Time based - will vest on each anniversary of the transaction close date. Shares under this scheme are held in trust for employees by a subsidiary, Ingham 2 Pty Limited. All options under this scheme vested upon completion of the IPO in the year, and remained held in trust, escrowed from sale. Set out below summarises options granted under the scheme: No options expired during these periods.

Shares under this scheme vested upon	scheme are held in trust for employees completion of the IPO in the year,	by a subsidiary, and remained held in trust,	Ingham 2 Pty Limited. escrowed from	All options sale.	under this
Set out below	summarises options granted under the	scheme:
No options expired	during these periods.
Share options	outstanding at the end of the year have	the following expiry dates	and exercise	prices:
		2017		2016
Grant Date	Expiry Date	Exercise price	Number of options	Exercise price	Number of options
space
June 2014 October 2014	26 June 2019 16 October 2019	-	- - -	\$1.00 \$1.13	12,940,000 1,637,000
27 17 20 March 2015	19 March 2020	\$0.81	565,125	\$0.81	565,125
20 March 2015	19 March 2020	\$0.81	1,786,722	\$0.81	3,088,174
19 June 2015	18 June 2020	\$0.81	812,038	\$0.81	1,481,482
3 July 2015	2 July 2018	\$0.81	370,370	\$0.81	370,370
18 September 2015	17 September 2020	\$0.81	234,444	\$0.81	444,444
14 October 2015	13 October 2020	\$1.40	250,000	\$1.40	250,000
November 2015	1 November 2020	\$1.40	730,000	\$1.40	850,000
2 22 December 2015	21 December 2018	\$1.40	2,669,842	\$1.40	2,669,842
22 December 2015	21 December 2020	\$1.40 \$9.65	820,000 8,238,541	\$1.40 \$11.78	1,042,857 25,339,294

20 Share-based payments (continued) The number of in substance share options granted during the year was nil (2016: 5,627,513). 5,627,513 (2016: nil) in substance share options vested during the year, none were exercised, forfeited or expired (2016: nil). The fair value at grant date was determined using an adjusted form of the Black Scholes Model.

The number of in substance share substance share options vested	options granted during the year was nil (2016: 5,627,513). 5,627,513 (2016: nil) in during the year, none were exercised, forfeited or expired (2016: nil).
The fair value at grant date was	determined using an adjusted form of the Black Scholes Model.
Long Term Incentive Plan for FY17	(LTI Offer)
The table below outlines the key Term	terms of the FY17 LTI Offer under the Plan: Description
Eligibility to participate in LTI	• Offers may be made at the Board's discretion to employees of the Ingham's
Offer	Group or any other person that the Board determines to be eligible to receive a grant under the Plan
	• The 2017 LTI Offer has been made to the following Ingham's KMP Executives:
	- Mick McMahon (Chief Executive Officer)
	- Ian Brannan (Chief Financial Officer)
	- Janelle Cashin (Chief Operating Officer)
	- Quinton Hildebrand (Chief Commercial Officer)
	- Jonathan Gray (Sales and Marketing Director)
	- Adrian Revell (Managing Director - New Zealand)
Offers under the Plan	• The LTI Offer is a grant of performance rights (Rights)
Grant of Rights	• A Right entitles the participant to acquire a Share for nil consideration at the end of the performance period, subject to meeting specific performance conditions. The Board retains the discretion to make a cash payment to participants on vesting of the Rights in lieu of an allocation of Shares.
Quantum of Rights	The face value of the LTI Offer is \$3.25 million.
	Mick McMahon was granted Rights with a face value of \$1.5 million. Other participating members of senior management were granted Rights with a cumulative face value of \$1.75 million.
	The final number of Rights awarded to each participant was calculated by dividing the dollar value of their LTI opportunity by the Final Listing Price of \$3.15.
Performance Period	The performance period commenced on 7 November 2016 (date of ASX listing) and ends on 30 June 2019.

	Inghams Group Limited	(formerly Ingham Holdings I Pty Limited)
	Notes	to the consolidated financial statements As at 1 July 2017
20 Share-based payments	(continued)
Long Term Incentive Plan for	FY17 (continued)
Performance conditions	• Rights granted as part of the LTI Offer period, subject to meeting the performance	will vest at the end of the performance conditions.
	• The performance conditions are:
	• 75% of the Rights are subject to a absolute EPS over the performance period	performance condition based on Ingham's (EPS Component); and
	• The remaining 25% of the Rights are (TSR) performance condition, measured Component). Ingham's relative TSR will be comprising the ASX 200 (excluding companies resources).	subject to a relative total shareholder return over the performance period (TSR compared to a comparator group classified as financial, mining and
	EPS Component
	• For any Rights in the EPS Component to (as set out below). The percentage of Rights vest, if any, will be determined over the following vesting schedule:	vest, a threshold target must be achieved comprising the EPS Component that performance period by reference to the
	Ingham's EPS over the performance period	% of Rights that vest
	Less than threshold target	Nil
	Equal to threshold target	50%
	Greater than threshold target up to maximum target	Straight line pro rata vesting between 50% and 100%
	At or above maximum target	100%
	• Threshold and maximum targets will be each financial year, with vesting of the EPS against these targets over the 3 year was based on the Pro Forma FY17 52 Week maximum set at 25% pro forma NPAT	set annually by the Board at the start of Component based on achievement performance period. For FY17, the threshold Forecast for NPAT (\$98.8m) and the growth.

	Inghams Group Limited	(formerly Ingham Holdings I Pty Limited) Notes to the consolidated financial statements As at 1 July 2017
20 Share-based payments	(continued)
Performance conditions (continued)	TSR Component • The percentage of Rights comprising based on Ingham's TSR ranking over the following vesting schedule:	the TSR Component that vest, if any, will be performance period, as set out in the
	Ingham's TSR rank in the Relevant Comparator Group	% of Rights that vest
	Less than 50th percentile	Nil
	At 50th percentile (threshold performance)	50%
	Between 50th and 75th percentile	Straight line pro rata vesting between 50% and 100%
	At 75th percentile or above	100%
	• Performance will not be re-tested if the at the end of the performance period. of the performance period will lapse	performance conditions are not satisfied Any Rights that remain unvested at the end immediately.
Voting and dividend entitlements	The Rights granted under the LTI Offer to vesting. Shares allocated upon vesting voting rights as other Shares.	do not carry dividend or voting rights prior of Rights carry the same dividend and
Restrictions on dealing	Participants must not sell, transfer, Rights comprising the LTI Offer unless by law.	encumber, hedge or otherwise deal with the the Board allows it or the dealing is required
	Participants will be free to deal with the comprising the LTI Offer, subject to the Dealing Policy.	Shares allocated on vesting of the Rights requirements of the Ingham's Securities
Cessation of employment	If the participant ceases employment for the Board determines otherwise, any Board has the discretion to designate a automatically lapse.	cause or due to their resignation, unless unvested Rights will automatically lapse. The "good leaver", whereby Rights will not
	In all other circumstances, the Rights will the performance period that has elapsed) original performance conditions, unless them otherwise.	be pro-rated (based on the proportion of and remain on foot and subject to the the Board exercises a discretion to treat

		Inghams Group Limited (formerly Ingham Notes to the consolidated	Holdings I Pty Limited) financial statements As at 1 July 2017
20 Share-based Clawback and	payments (continued) preventing Under the Plan	rules and the terms of the LTI Offer, the Board	has clawback powers
inappropriate benefits	which it may	exercise, among other things:
	• The participant misconduct, company into Ingham's is required remuneration	has acted fraudulently or dishonestly, has brought Ingham's, the Ingham's Group or any disrepute or breached their obligations to the by or entitled under law or Ingham's from the participant;	engaged in gross Inghams' Group Inghams' Group, or policy to reclaim
	• There is a Group company;	material misstatement or omission in the accounts or	of an Ingham's
	• The participant's breach of obligations Rights would not	entitlements vest or may vest as a result of any other person and the Board is of have otherwise vested.	of fraud, dishonesty or the opinion that the
The fair value at grant grant date fair value	date was determined using an of rights granted in the year was	adjusted form of the Black Scholes Model. \$2.48.	The weighted average
The model inputs for	performance rights (2016: options)	granted during the year ended included:
(a) Exercise price (b) Share price (c) Expected (d) Expected (e) Risk-free	\$nil (2016: \$1.40) at grant date \$3.15 (2016: \$2.00 price volatility 35-45% (2016: 30%) dividend yield 6% (2016: NIL) interest rate 1.70% (2016: between	to \$2.50) 1.50 to 2.25%)
		2017 2016
Grant Date space	Expiry Date	Number of Number of rights rights
7 November 2016	7 November 2019	- - 1,031,745 -
Other share transactions

	2017	2016
Grant Date Expiry Date space	Number of rights	Number of rights
7 November 2016 7 November	- 2019 1,031,745	- -
Other share transactions
In addition, Peter Bush was awarded the role of Board Chairman.	\$200,000 of shares at the IPO Offer Price	of \$3.15 for nil consideration for accepting

	Inghams Group	Limited (formerly Ingham Holdings	I Pty Limited)
		Notes to the consolidated financial As	statements at 1 July 2017
21 Cash flow	information
		2017	2016
		\$000	\$000
			Restated*
Reconciliation of	profit after income tax
Profit after tax for Depreciation	the period	59,100 42,400	25,200 33,300
Non-cash employee	benefits expense - share based payment	4,600	3,400
Net gain on sales of	assets	(10,400)	(3,300)
Share of net profit	of joint venture (net of dividend received)	(400)	(200)
Finance costs		41,800	42,600
Impairment of	property, plant & equipment	-	2,600
Devaluation of Effect of taxation	property, plant & equipment on items recognised direcly in equity	- (1,900)	1,200 -
PPE disposal costs		(1,300)	-
IPO costs expensed		28,000	-
Change in operating	assets and liabilities
(Increase)/decrease	in trade and other receivables	(9,100)	(23,900)
(Increase)/decrease (Increase)/decrease	in biological assets in inventories	700 1,800	(11,100) (300)
Increase/(decrease)	in trade and other payables	30,100	19,900
(Decrease)/increase	in provision for income taxes payable	3,100	(13,800)
(Decrease)/increase	in deferred tax liabilities	4,400	(4,200)
Increase/(decrease)	in other provisions	(22,900)	23,500
Net cash provided	by operating activities	170,000	94,900
- Refer to note 2	for details.

		Inghams	Group Limited (formerly	Ingham Holdings	I Pty Limited)
			Notes to the	consolidated	financial statements As at 1 July 2017
22	Related party disclosures
Group	structure
(a)	Former parent entity
			Place of
Name		Type	Incorporation	Ownership 2017	interest 2016
space TPG		Former ultimate controlling entity	United States	47% 47%	97% 97%
TPG successful	ceased to be the parent entity IPO of the Group. From	and ultimate controlling party this time the ultimate controlling	of the Group on party of the Group is	11 November Inghams Group	2016 following the Limited.
(b)	Subsidiaries
The follows:	consolidated financial statements	include the financial statements	of Inghams Group	Limited and	its subsidiaries as
				Equity	holding
			Country of	2017	2016
	Name of	entity	incorporation	%	%

				2017	2016
space		entity		47%	97%
(b)	Subsidiaries
The follows:	consolidated financial statements	include the financial statements	of Inghams Group	Limited and	its subsidiaries as
				Equity	holding
	Name of	entity	Country of incorporation	2017 %	2016 %
Empty Ingham	space Holdings II Pty Limited (a), (c)		Australia	100	100
Ingham	Holdings III Pty Limited (a),	(c)	Australia	100	100
Adams	Bidco Pty Limited (a), (c)		Australia	100	100
Ingham	Enterprises Pty Limited (a),	(c)	Australia	100	100
Inghams	Enterprises Pty Limited (a),	(c)	Australia	100	100
Ingham	Finco Pty Limited (b)		Australia	100	100
Ingham	2 Pty Limited (b)		Australia	100	100
Agnidla	Pty Limited (b), (c)		Australia	100	100
Aleko	Pty Limited (b), (c)		Australia	100	100
Inghams	Enterprises (NZ) Pty Limited	(a), (c)	Australia	100	100
Inghams	Property Management Pty	Limited (b), (c)	Australia	100	100
Ovoid	Insurance Limited		Bermuda	100	100
Ovoid	Insurance Pty Limited (b)		Australia	100	100
Inadnam Harvey	Pty Limited (b), (c) Farms Pty Limited		Australia New Zealand	100 100	100 100
(a) (b)	These subsidiaries have been available to the Company These subsidiaries are not audited financial statements	granted relief from the necessity under ASIC Corporations (Wholly audited as they are small proprietary under ASIC Corporations (Audit	to prepare financial Owned Companies) companies which Relief) Instrument	1,500 reports under Instrument 2016/785. are not required 2016/784.	1,500 the option to prepare
(c)	These subsidiaries, along with from Note 30.	Inghams Group Limited, form	the Deed of Cross	Guarantee Group	described further

Inghams Group Limited (formerly Ingham Holdings I Pty Notes to the consolidated financial As at 1 July 22 Related party disclosures (continued) (c) Key management personnel compensation 2017 \$000 Short-term employee benefits 15,455 Other long-term employee benefits 150 Share based payments 3,247 - Termination benefits 18,852 Information regarding individual directors and executives compensation and some equity instruments disclosures permitted by Corporations Regulations 2M.3.03 and 2M.6.04 is provided in the Remuneration Report section of Directors' Report. No director has entered into a material contract with the Group since the end of the previous financial year and there no material contracts involving directors' interests existing at year end. (d) Transactions with other related parties The following transactions occurred with related parties: Other transactions 1,183 Monitoring fees paid to former ultimate parent entity
Limited) statements 2017 2016 \$000 6,085 74 2,235 609 9,003 as the were 3,110

Monitoring fees paid to former ultimate parent entity	1.183	3.110
ULIIEI UUDUULIUIS

23 Financial risk management The Group's activities expose it to a variety of financial risks: market risk (including foreign exchange risk, interest rate risk and commodity price risk), credit risk and liquidity risk. The Group's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Group. Risk management is carried out by a central treasury department. Treasury identifies, evaluates and hedges financial risks in close co-operation with the Group's operating units. Treasury provides overall risk management, covering specific areas,

such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments in accordance with the Group's facilities agreement and company policies. The Group uses derivative financial instruments such as foreign exchange contracts and interest rate swaps to hedge certain risk exposures. Derivatives are exclusively used for economic hedging purposes and not as trading or speculative instruments. The Group uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis in the case of interest rate, foreign exchange and other price risks, and aging analysis for credit risk. Fair value hierarchy The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes. Fair value inputs are summarised as follows: Level 1: The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading and available-for-sale securities) is based on quoted market prices at the end of the reporting period. Level 2: The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2. Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2. 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. value inputs are summarised as follows: Fair value hierarchy Note Valuation technique Level 2 16 Calculated as the present value of estimated future cash flows using a market based yield curve sourced from available market data quoted for all major interest rates. Plant & Equipment Level 3 12 Based on current prices in an active market for similar properties in the same location and condition. plant and equipment is valued using independent valuers who use recent land and property sales adjusted for characteristics of the asset(s) being valued such as location and use. value hierarchy is re-assessed annually for any change in circumstance that may suggest a revised level be assigned to of balance measured at fair value. Market risk Foreign exchange risk The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures.
	risk.
	Level
	Fair
	Derivatives Property,
	Property,
	Fair a type
	(a)
	(i)

23 Financial risk management (continued) (a) Market risk (continued) (i) Foreign exchange risk (continued) forecasting.

Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the entity's functional currency. The risk is measured using sensitivity analysis and cash flow Management has a policy requiring Group companies to manage their foreign exchange risk against their functional currency. The Group companies are required to hedge their foreign exchange risk exposure arising from future commercial transactions and recognised assets and liabilities using forward contracts. Additionally, the Group will look to manage the translation exposure to foreign denominated profits through the use of derivatives such as forward contracts. (ii) Foreign exchange sensitivity The Group has some exposure to exchange rate risk as it purchases some of the supplies in foreign currencies and has a subsidiary with a New Zealand dollar (NZD) functional currency. The exposure to other currencies is collectively

	forecasting.
	contracts.
(ii)	Foreign exchange sensitivity
	The Group has some exposure to exchange subsidiary with a New Zealand dollar immaterial and as such the Group's foreign	rate risk as it purchases some (NZD) functional currency. The currency exposure is materially	of the supplies exposure to in respect of	in foreign currencies other currencies NZD.	and has a is collectively
		Impact on post tax	profits Impact	on other	components of
		2017 \$000	2016 \$000	equity 2017 \$000	2016 \$000
+100 -100	bp variability in exchange rate bp variability in exchange rate	200 (200)	- -	1,400 (1,400)	800 (800)
(iii)	Cash flow and fair value interest rate risk
	The Group's main interest rate risk arises Group to cash flow interest rate risk. the borrowings are carried at fair value. using interest rate swaps to achieve this. were denominated in Australian Dollars.	from long-term borrowings. Borrowings issued at fixed rates Group policy is to maintain at During the year ending 1 July	Borrowings issued expose the Group least 50% of its 2017, the Group's	at variable rates, to fair value interest term borrowings borrowings	expose the rate risk if at fixed rate at variable rate
	The Group's borrowings and receivables risk as defined in AASB 7.	are carried at amortised cost.	They are therefore	not subject	to interest rate
	The Group manages its cash flow interest Group agrees with other parties to exchange, floating rate interest amounts calculated	rate risk by using floating-to-fixed at specified intervals, the by reference to the agreed notional	interest rate difference principal	swaps. Under between fixed contract amounts.	these swaps, the rates and
As	at the end of the reporting period, the	Group had the following interest	rate swap	contracts outstanding:
			Notional principle amount 2017 \$000	2016 \$000	Interest rate 2017 \$000

	2017 \$000	2016 \$000	2017 \$000	2016 \$000
floating rate interest amounts calculated by reference	to the agreed notional	principal	amounts.
As at the end of the reporting period, the Group had	the following interest	rate swap contracts	outstanding:
		Notional principle
		amount 2017 \$000	2016 \$000	Interest rate 2017 \$000
Interest rate swap		210,000	366,000	3.5% to 4.5%
The contracts require settlement of net interest dates on which interest is payable on the underlying	receivable or payable debt.	every month. The	settlement dates	align with the

Sensitivity

(a) Market risk (continued) (iii) Cash flow and fair value interest rate risk (continued)

(a) Market risk (continued)
(iii) Cash flow and fair value interest rate risk	(continued)
Sensitivity Profit or loss is sensitive to higher/lower rates. Other components of equity change of borrowings.	interest income from cash and as a result of an increase/decrease	cash equivalents in the fair	as a result of change value of the cash	in interest flow hedges
	Impact on post tax	profit	Impact on other	components of
	2017	2016	equity 2017	2016
	\$000	\$000	\$000	\$000
+100 bp variability in interest rate -100 bp variability in interest rate	(1,900) 1,900	(3,600) 3,600	3,800 (4,000)	5,800 (6,100)
(iv) Commodity Price
The Group's exposure to commodity price risk business, however exposure is not considered forward contracts to purchase grain. This is Group had \$243,600,000 (2016: \$248,400,000)	arises from commercial significant. To manage its performed through monitoring of commodity contracts for the ordinary course of business,	transactions commodity movements the delivery in	required for the operations price risk the Group in price. As at 1 July the next financial derivative asset or liability is	of the enters into 2017, the year. As these recognised at

The Group's exposure to commodity price risk arises from commercial transactions required for the operations of the business, however exposure is not considered significant. To manage its commodity price risk the Group enters into forward contracts to purchase grain. This is performed through monitoring movements in price. As at 1 July 2017, the Group had \$243,600,000 (2016: \$248,400,000) of commodity contracts for the delivery in the next financial year. As these are forward contracts for items to be used in the ordinary course of business, no derivative asset or liability is recognised at year end, and a such a 10% movement in commodity prices at year end would not impact reported profit for the year ended 1 July 2017. (b) Credit risk Credit risk arises from cash and cash equivalents, favourable derivative financial instruments, deposits with banks and financial institutions and the risk of a financial loss if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Group has a credit policy which provides guidelines for the management of credit risk. The guideline provides for the manner in which the credit risk of customers is assessed and the use of credit ratings and other information in order to set appropriate account limits. Customers that do not meet minimum credit criteria are required to pay up front. Customers who fail to meet their account terms are reviewed for continuing credit worthiness. The maximum exposure to credit risk at the reporting date is the carrying amount of the accounts receivable. The Group does not consider that there is any significant concentration of credit risk. For some trade receivables the Group may obtain security in the form of credit insurance. Revenues from five key customers accounted for 55% to 60% of revenue for the year ended 1 July 2017 (2016: 55% to 60%) relating to both operating segments. Individual receivables which are known to be uncollectible are written off by reducing the carrying amount directly. The Group considers that there is evidence of impairment if any of the following indicators are present: • significant financial difficulties of the debtor

• probability that the debtor will enter bankruptcy or financial reorganisation and default or delinquency in Receivables for which an impairment provision was recognised are written off against the provision when there is no expectation of recovering additional cash. Impairment losses are recognised in profit or loss within other expenses. Subsequent recoveries of amounts previously written off are credited against other expenses.

• payments.

23 Financial risk management (continued) (c) Liquidity Risk Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due. At the end of the reporting period the Group held deposits of \$600,000 (2016: \$600,000) on 30 day and 60 day terms which are readily available to generate cash inflows for managing liquidity risk. Management monitors rolling forecasts of the Group's liquidity reserve (comprising the Group's undrawn re-drawable term cash advance facility below) and cash and cash equivalents on the basis of expected cash flows. In addition, the Group's liquidity management policy involves projecting cash flows and considering the level of liquid assets necessary to

		(2016: \$600,000) on 30 day and 60 day terms which are readily available risk. rolling forecasts of the Group's liquidity reserve (comprising the facility below) and cash and cash equivalents on the basis of expected management policy involves projecting cash flows and considering the level balance sheet liquidity ratios. access to the following undrawn borrowing facilities at the end of the reporting 2017 \$000 \$000 Drawn Available one year 17,100 182,900 450,000 78,100 beyond one year 467,100 261,000 access to re-drawable term cash advance facilities which may be drawn at the earlier of the date which is 30 days before termination date of the cancelled in full. liquidity risk disclosures reflect all contractually fixed repayments and and derivatives as of 1 July 2017. The timing of cash flows for liabilities is contract. Carrying value Contractual cash flows Less than \$000 \$000
deposits managing	of \$600,000 liquidity			to generate	cash inflows for
term Group's meet	Management monitors cash advance liquidity these, monitoring			Group's cash flows. of liquid	undrawn re-drawable In addition, the assets necessary to
The	Group had			period:
					2016
				\$000 Drawn	\$000 Available
Floating	rate
	Expiring within			23,300	1,900
	Expiring			525,500 548,800	86,900 88,800
The available The financial of the	Group has until commitments are following liabilities underlying			any time. facilities interest resulting based on the	These facilities are agreement or the from recognised contractual terms
				1 year \$000	1 year to 5 years \$000
2017
Trade	payables	255,200	255,200	253,200	2,000
Factored	trade payables	17,100	17,100	17,100	-
Derivative	financial liabilities	2,200	2,200	2,200	-

		2017		2016
		\$000	\$000 \$000	\$000
		Drawn Available	Drawn	Available
		467,100 261,000	548,800	88,800
of the underlying contract.
	Carrying value	Contractual cash flows	Less than 1 year	1 year to 5 years
	\$000	\$000	\$000	\$000
2017
Trade payables	255,200	255,200	253,200	2,000
Factored trade payables	17,100	17,100	17,100	-
Derivative financial liabilities Interest bearing liabilities	2,200 448,600	2,200 450,000	2,200 -	- 450,000
	723,100	724,500	272,500	452,000
	Carrying value	Contractual cash flows	Less than 1 year	1 year to 5 years
	\$000	\$000	\$000	\$000
				2,700
2016
Trade payables	242,500	242,500	239,700
Derivative financial liabilities Interest bearing liabilities	14,300 541,500	14,300 548,800	7,900 23,300	6,500 525,500

24 Interests in joint arrangements A subsidiary has a 50% interest in the joint venture entity, AFB International Pty Limited, the principal activity of which is the supply of high quality, high performance palatability products under Bioproducts BioFlavor brand name to the pet food

24	Interests in joint arrangements
A the industry	subsidiary has a 50% interest in the joint venture supply of high quality, high performance palatability in Australia, New Zealand and the Pacific accordance with the accounting policy described in	entity, AFB International products under Rim. Information relating note 2(b), is set out below.	Pty Limited, Bioproducts BioFlavor to the joint	the principal activity brand name to venture entity,	of which is the pet food presented in
Name	of principal activity	Ownership interest		Carrying value of	investment
		2017 %	2016 %	2017 \$000	2016 \$000
AFB Pet	International Pty Limited food manufacture	50	50	2,000	1,600
	Movement in investment in joint arrangements:			2017 \$000	2016 \$000
Opening Add:	balance share of net profit of joint venture			1,600 700	1,500 500
Less: Closing	dividend received from joint venture balance			(300) 2,000	(400) 1,600
During \$790,141).	the year the Group sold goods and services \$6,026,857). At balance date the amount owed Outstanding balances are unsecured and	to AFB International Pty from AFB International Pty on normal commercial terms	Limited to Limited to and	the value of \$6,061,781 the Group is \$1,711,696 conditions.	(2016: (2016:
25	Contingencies
State guarantee each	WorkCover authorities also require guarantees is based on independent actuarial advice reporting date do not equal the liability at these	against workers' of the outstanding liability. dates due to the timing	compensation Workers' of issuing the	self insurance compensation guarantees guarantees.	liabilities. The held at
The	probability of having to make a payment under	these guarantees is considered	remote.
No for	provision has been made in the consolidated self-insured risks, which includes liabilities Consolidated Statement of Financial Position at the	financial statements in respect relating to workers' compensation reporting date, refer Note	of these claims, 15.	contingencies, however have been recognised	provisions in the
26	Commitments
(a)	Capital commitments
Capital	expenditure contracted for at the end of the	reporting period but not	recognised as	liabilities is as follows:
				2017	2016

			in the
	Capital commitments
for self-insured risks, which includes liabilities relating to workers' compensation claims, have been recognised Consolidated Statement of Financial Position at the reporting date, refer Note 15. 26 Commitments (a) Capital expenditure contracted for at the end of the reporting period but not recognised as liabilities is as follows: 2017 \$000
			2016
			\$000
Property,	plant and equipment	21,300	53,100
In through	addition, the Group is committed to \$44,700,000 of expenditure on capital projects contractual arrangements. The Group will recover expenditure from these parties	which are funded by within 3 months of	third parties expenditure
being	incurred.

26 Commitments (continued) (b) Lease commitments Non-cancellable operating leases

26	Commitments (continued)
(b)	Lease commitments
	Non-cancellable operating leases
The varying	Group leases various offices, farms, distribution and processing facilities, plant and terms, escalation clauses and renewal rights.	office equipment. The	leases have
	Commitments for minimum lease payments in relation to non-cancellable operating	leases are payable as	follows:
		2017 \$000	2016 \$000
Within	one year	81,300	72,400
Later Later	than one year but not later than five years than five years	280,500 749,900	251,300 734,000
		1,111,700	1,057,700
27	Earnings per share (EPS)
Basic average	EPS is calculated by dividing profit for the year attributable to ordinary equity number of ordinary shares outstanding during the year.	holders of the Parent by	the weighted
Diluted interest year ordinary	EPS is calculated by dividing the net profit attributable to ordinary equity holders on the convertible preference shares) by the weighted average number of plus the weighted average number of ordinary shares that would be issued on shares into ordinary shares.	of the Parent (after ordinary shares outstanding conversion of all the	adjusting for during the dilutive potential
	following table reflects the income and share data used in the basic and diluted EPS	computations:
The		2017 \$000	2016 \$000
Earnings
	attributable to ordinary equity holders for calculating basic and diluted EPS calculations	59,100	25,200
Profit
Number	of ordinary shares	Number of 000	shares 000

	2017	2016
calculations	59,100	25,200

		1,111,700	1,057,700
			2016 \$000 25,200
		2017
Earnings		\$000
Profit	attributable to ordinary equity holders for calculating basic and diluted EPS
	calculations	59,100
		Number of	shares
Number	of ordinary shares	000	000
Weighted	average number of ordinary shares used in the calculation of basic EPS	349,100	308,500
Dilutive	effect of share options	7,600	10,700
Weighted	average number of ordinary shares for diluted EPS	356,700	319,200
Basic	EPS (cents per share)	16.93	8.18
Diluted	EPS (cents per share)	16.57	7.91

Basic EPS (cents per share)	16.93
Diluted EPS (cents per share)	16.57

	Inghams Group Limited	(formerly Ingham Holdings I	Pty Limited)
	Notes	to the consolidated financial As at	statements 1 July 2017
28	Remuneration of auditors
During related	the period the following fees were paid or payable for services provided practices and non-related audit firm.	by the auditor of the parent	entity, its
		2017	2016
		\$000	\$000
KPMG
Amounts Audit	received or due and receivable by KPMG for: and review of financial statements	769	700
Tax	compliance, advisory and other services	137	175
IPO	due diligence services	1,121	410
Total	amount paid or payable to auditors	2,027	1,285
29	Parent entity financial information
	Summary financial information
The	individual financial statements for the parent entity show the following	aggregate amounts:
		2017	2016
	Statement of financial position	\$000	\$000
Space

		2017	2016
		\$000	\$000
KPMG
Summary	financial information
The	individual financial statements for the parent entity show the following	aggregate amounts:
		2017	2016
		\$000	\$000
Statement	of financial position
Space	Non-current assets	621,300	59,200
Total	assets	621,300	59,200
space
Current	liabilities	8,000	5,300
	Non-current liabilities	448,600	40,000
space
Total	liabilities	456,600	45,300
Net	assets	164,700	13,900
A Equity
	Contributed equity	262,000	107,800
	Accumulated losses	(97,000)	(94,000)
Other	reserves	(300)	-
Space		164,700	13,800
Space	Profit/(loss) for the year	5,800	(2,500)
Total	comprehensive income	5,500	(2,500)
The	parent entity does not have any commitments or contingent liabilities	as at 1 July 2017.

30 Deed of cross guarantee Inghams Group Limited and all of the subsidiaries shown as (c) in note are parties to a deed of cross guarantee dated 22 May 2017, under which each company guarantees the debts of the others. By entering into the deed, the wholly-owned entities have been relieved from the requirement to prepare a financial report and directors' report under ASIC Corporations (Wholly Owned Companies) Instrument 2016/285 issued by the Australian Securities and Investments Commission. The effect of the Deed is that the Company guarantees to each creditor payment in full of any debt in the event of winding up of any of the subsidiaries under certain provisions of the Corporations Act 2001. If a winding up occurs under other provisions of the Act, the Company will only be liable in the event that after six months any creditor has not been paid in full. The subsidiaries have also given similar guarantees in the event that the Company is wound up. (a) Consolidated income statement, consolidated statement of comprehensive income and summary of movements in consolidated retained earnings The companies shown as (c) in note represent a 'closed group' for the purposes of the Instrument, and as there are no other parties to the deed of cross guarantee that are controlled by Inghams Group Limited, they also represent the 'extended closed group'. Set out below is a condensed consolidated income statement, consolidated statement of comprehensive income and a

	Commission.
The other 'extended	companies shown as (c) in note represent a 'closed group' for the purposes of the parties to the deed of cross guarantee that are controlled by Inghams Group closed group'.	Instrument, and as there are no Limited, they also represent the
Set summary	out below is a condensed consolidated income statement, consolidated statement of of movements in consolidated retained earnings for the period ended 1 July 2017 of	comprehensive income and a the closed group.
		2017
	Consolidated income statement	\$000
Revenue	from continuing operations
Sales	revenue	2,426,900
Expenses
Expenses	from ordinary activities	(2,350,100)
Profit	before income tax	76,800
Income Profit	tax expense for the period	(18,100) 58,700
	Consolidated statement of comprehensive income
Profit	for the period	58,700
Other	comprehensive income
Changes Exchange	in the fair value of cash flow hedges differences on translation of foreign operations	8,800 (200)
Other	comprehensive income for the period, net of tax	8,600

	Deed of cross guarantee (continued)
	Consolidated balance sheet out below is a consolidated balance sheet as at 1 July 2017 of the closed group.
2017
\$000
114,600 230,400	Biological assets Trade and other receivables
157,800	Inventories
46,400	Assets classified as held for sale
100	Derivative financial instruments
146,100 695,400	and cash equivalents
	Total current assets
300	Derivatives financial instruments
372,800	Property, plant and equipment
2,000 375,100	Equity accounted investments Total non-current assets
1,070,500	Total assets
269,600	Trade and other payables
77,300 2,200	Provisions Derivative financial instruments
8,100	Current tax liability
10,000	Related party payables
367,200	Total current liabilities
448,600	Borrowings
37,200	Provisions
11,200	Deferred tax liabilities
497,000	Total non-current liabilities
864,200	Total liabilities
206,300	assets
	Equity
262,000	Contributed equity
41,500	Other reserves
(97,200)	(Accumulated losses)/Retained earnings
206,300	Total equity

31 Events after the reporting period Subsequent to the year end a dividend of 9.5 cents per share has been declared totalling \$36.1 million to be paid on 4 October 2017. The financial effect of this dividend has not been brought to account in these consolidated financial statements and will be recognised in subsequent financial reports. Other than the matter discussed above, there has not been any matter or circumstance that has arisen since the end of the reporting period that has significantly affected, or may significantly affect, the operations of the Group's operations or results of those operations or the Group's state of affairs.

• 1. In the opinion of the directors: (a) The consolidated financial statements and notes set out on pages 44 to 94 are in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the Group's financial position as at 1 July 2017 and of its performance for (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
• (b) the financial statements and notes also comply with International Financial Reporting Standards as disclosed in Note 2(b); and (c) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable. 2. There are reasonable grounds to believe the Company the Group entities identified in note 30 will be able to meet any obligations or liabilities to which they are or may become subject to by virtue of the Deed of Cross Guarantee between the Company and those Group entities pursuant to ASIC Corporations (Wholly Owned Companies) Instrument 2016/285. 3. The directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the chief executive officer and chief financial officer, for the financial year ended 1 July 2017. 4. The directors draw attention to note 2(a) to consolidated financial statements, which includes a statement of compliance with International Financial Reporting Standards. This declaration is made in accordance with a resolution of the directors. Peter Bush

Chairman

Linda Bardo Nicholls, AO Non-executive director North Ryde, Sydney 22 August 2017

The key audit matter	How the matter was addressed in our audit
Revenue is recognised at the fair value of the consideration received or receivable and is net of returns, trade allowances, rebates and amounts collected on behalf of third parties. The accounting for trade allowances and rebates, which are typical within the industry	Our procedures included: Considering the appropriateness of the Group's $\bullet$ accounting policies regarding revenue recognition, trade allowances and rebates against the requirement of the Accounting Standards;
in which the Group operates, is a key audit matter due to the: Significance of trade allowances and	Testing the Group's controls over the ٠ agreement, monitoring and calculation of trade allowances and rebates;
rebates to the financial report; Number of categories of customers ٠ including retail, quick service restaurants and foodservice, which attract different trade allowances and rebate terms. This requires our evaluation to be performed across	Checking a sample, by customer category, of ٠ rebates and trade allowances to signed customer contractual terms;
	Comparing the amount of the trade allowances $\bullet$ and rebates by customer category as a percentage of gross revenue to the prior period;
these categories; Variety of customer-specific contractual arrangements for trade allowances and rebates, increasing the audit effort to address these specific conditions; and	Assessing the accrual recognised at balance ٠ date by calculating an expected accrual per customer based on specific customer trading and settlement terms and comparing this to the recognised balance date accrual for a sample of significant customers by customer category;
Differing settlement terms for customers which leads to complexity in checking the accruals at balance date across the portfolio.	Assessing, on a sample basis, the accuracy of ٠ prior period rebate accrual estimates to inform our evaluation of the Group's current balance date accruals, and
The accrual at balance date is based on sales activity and relevant rebate and trade allowance rates/conditions of customers, for the time period since the last payment date to balance	Comparing a sample of rebate claims or correspondence received since balance date to accruals recognised at period end, for evaluation of the accrual existence and quantum.