IPD GROUP LTD — Annual Report 2024

Oct 24, 2024

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20 24

Contents

Contents
FY24 Highlights	1
Chair’s Letter	2
CEO Letter	4
Our Strategy	6
Our Pillars	8
Our Connected Group	10
Business Review	14
Our People and Sustainability	22
Financial Report	26
Directors’ Report	27
Auditor’s Independence Declaration	42
Independent Auditor’s Report	43
Directors’ Declaration	50
Consolidated Financial Statements	51
Notes to the Financial Statements	57
Consolidated Entity Disclosure Statement	96
Corporate Directory	97

Acknowledgement of Country

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IPD Group acknowledges that we operate on the traditional lands of First Nations Peoples. We are committed to recognising the rights and culture of Traditional Owners, building community relationships, advancing reconciliation, and paying respects to Elders past and present.

Disclaimer

This report contains forward-looking statements, including but not limited to statements regarding: trends in consumer preferences; commodity prices; goals, targets, plans, strategies, and objectives of IPD Group; assumed near and long-term scenarios and transition pathways; potential global responses to climate change; regulatory and policy developments; the development and uptake of certain technologies; and the potential effect of possible future events on the value of IPD Group.

The forward-looking statements in this report are based on management’s good faith, current expectations and reflect judgments, assumptions, estimates, and other information available as of the date of this report. They are, by their nature, subject to significant uncertainties, many of which are outside IPD Group’s control. Actual results, circumstances, and developments may differ materially from those expressed in this report, and readers are cautioned not to place undue reliance on these forwardlooking statements.

Forward-looking statements should therefore be read in conjunction with, and are qualified by reference to, the expectations, judgments, assumptions, estimates, and other information and risk factors referred to above.

IPD Group Limited ACN 111 178 351

FY24 Highlights

CMI Electrical acquisition

strengthens our portfolio, capabilities and customer value chain.

Gemtek integration

increases Addelec’s capability and efficiency to meet the growing demand for sustainable electrical infrastructure.

ABB Motors distribution agreement

positions us to lead in the shift to sustainable, energy-efficient motors.

Securing Data Centre Opportunities

Delivering across every step of the value chain.

REVENUE $290.4m Up 28.0% (PCP $226.9m)

UNDERLYING EBITDA[1]

$40.1m Up 44.8% (PCP $27.7m)

UNDERLYING EBIT[1]

$34.3m Up 46.6% (PCP $23.4m)

TOTAL DIVIDENDS

10.8 cents Payout ratio of 50%

1. Underlying EBITDA and EBIT have been arrived at by adding back acquisition related costs totaling $1,221,000.

IPD Group Annual Report 2024 1

Chair’s Letter

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Dear Shareholders,

On behalf of the IPD Group Board, I am pleased to provide our Annual Report for the financial year ending 30 June 2024 (FY24). I am again delighted to report that our company has delivered record financial results in FY24, as organic growth and the acquisitions of EX Engineering and CMI Operations increased Revenue by 28.0% vs the pcp and Underlying Net Profit After Tax by 44.7% vs the pcp.

During FY24 the Group’s capital structure changed as a result of the $92.1 million acquisition of CMI Operations, which was funded by a successful equity raising of $65 million and the establishment of a $40 million debt facility with the Commonwealth Bank of Australia. This corporate debt facility was IPD Group’s first ever debt facility, and balanced the desire to preserve shareholder equity against cost-effective debt funding. Pleasingly, the Group’s strong operating free cash flow conversion of 88% through FY24 has resulted in a modest year-end Net Debt position of only $8.8 million, with a cash balance of $22.3 million.

While CMI Operations was the largest acquisition IPD Group has undertaken to date, this approach to funding and strong performance over the period once again allowed the Board to approve total dividends to shareholders of 10.8 cents per share (fully franked) for FY24. This equates to shareholder payments of $11.2 million and a payout ratio of 50% of NPAT, in line with the dividend policy range of 40-60%. The total dividend of 10.8 cents per share was 16.1% higher than in FY23.

From a governance perspective, the Board placed particular focus across the financial year on M&A due diligence, evaluating expert advice on optimal CMI Operations acquisition funding options, succession planning, cyber security, and preparatory work for the upcoming Mandatory Climate Reporting legislation. The Board scheduled more Board meetings outside of head office in FY24 and benefited from interactions with staff in Melbourne, IPD Perth, EX Engineering Perth, Brisbane, and the main CMI Operations facility in Sydney. Workplace Health & Safety observation walks were also conducted by the Board during these visits.

FY24 represented the first full financial year of Jason Boschetti’s time as Chief Financial Officer, having assumed the role in January 2023 when former CFO Mohamed Yoosuff moved to the role of Director of Strategic Development. We are pleased to note that the smooth transition in responsibilities has been followed by continued strong execution on the part of both Jason and Mohamed, as reflected in the record FY24 results and the two successful acquisitions completed over the past year. Alongside CEO Michael Sainsbury, the Board is highly confident that the seasoned senior management team in place will continue to execute against IPD Group’s strategic priorities in the year ahead. Given the Group’s strong balance sheet, expanding range of products and services, and ongoing focus on strategic M&A, IPD Group is ideally positioned to continue supporting our customers as they execute against a multitude of megatrend tailwinds, in turn delivering earnings growth for our shareholders.

To close, I would like to thank my fellow directors for their support and guidance across a very busy Board schedule in FY24. The Board understands that the passion, drive, and expertise of our staff and supply partners have been fundamental to our success across FY24, and we thank all for your support and loyalty.

I look forward to hosting our Annual General Meeting on 26 November 2024, where we will provide shareholders with an update on first-quarter trading results for the Group. Thank you for your support.

David Rafter Chair

2 IPD Group Annual Report 2024

Operating Scale PRO-FORMA FY24 REVENUE $350.4m

NET ASSETS $150.7m

IPD is well-positioned to capitalise on the growing green energy opportunities stemming from Australia’s electrification and decarbonisation efforts.

David Rafter CHAIR

3

IPD Group Annual Report 2024

CEO Letter

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Dear Shareholders,

It’s my pleasure to present this update on IPD Group’s performance for the 2024 financial year.

IPD Group once again produced a very strong set of results as our operating model benefits from ongoing growth in demand for products well suited to meeting the long-term electrification of the economy. Continued focus on our strategic priorities, including expansion of the traditional IPD business and Addelec along with the acquisition of two highquality businesses, has allowed us to continue generating long-term returns for shareholders including both capital returns and dividends.

While high inflation and interest rates impacted all segments of the economy over the year, our team once again navigated this dynamic environment well and ensured IPD Group remains at the forefront of our customer’s minds as a leading supplier of value.

Our offering covers an expanding range of in-demand products and services, and along with our strong balance sheet we remain very well positioned to continue capturing the opportunities presented by the ongoing decarbonisation and electrification of the economy.

Financial Highlights

Over the 2024 financial year IPD Group once again achieved record financial results. These were driven by our teams across Australia, Sri Lanka, and the Philippines remaining laser-focused on our customers and their needs.

Key financial highlights included:

• Revenue: Our revenue rose to $290.4 million, up 28.0% on the previous year. This growth was driven by continued expansion in market share among our core portfolio, along with the contribution of the EX Engineering and CMI Operations acquisitions made during the year. Over the past five financial years revenue has now grown at a 35.0% annualised growth rate.

• Gross profit: Beyond this strong revenue growth, our underlying gross profit for FY24 was $107.8 million, up 24.2% on the previous year and representing a gross profit margin of 37.1%. While there was a slight decline in gross profit margin from the FY23 figure of 38.2%, this was the expected result of CMI Operations coming onboard. Crucially, CMI Operations’ higher EBITDA, EBIT, and NPAT margins will continue to improve broader Group figures going forward.

• EBITDA: Our underlying EBITDA of $40.1 million reflected a 44.8% increase on the previous year. Pleasingly, this figure was above the top end of the guidance range we had provided to the market in May 2024. While the core IPD business continues to perform very well, these earnings figures were strengthened by the high EBITDA margins of the acquired EX Engineering and CMI Operations businesses. Over the past five financial years underlying EBITDA has now grown at a 44.8% annualised rate.

• Strategic investments: While achieving these results IPD Group once again made significant strategic investments throughout the year. In the core IPD business this included the building out of the Strategic Solutions Team, which targets key segments including Data Centres, and expansion of the longstanding ABB relationship. Gemtek was integrated into the rebranded Addelec business and related services were expanded to Queensland, with this business now providing a comprehensive turnkey EV charging solution across the nation. In the Ex Engineering business, increased workshop capacity underpinned a 21% YoY increase in workshop builds whilst we also undertook a full review and alignment of stock management and systems and processes. CMI Operations continued to expand internationally, including into Mongolia and Indonesia, along with a broadening of the product range in Australia.

• Net Assets: As of 30 June 2024 our net assets have more than doubled from a year earlier, to $150.7 million. Within this is $22.3 million of cash and $31.1 million of borrowings incurred to fund the CMI Operations acquisitions. This reflects Net Debt of only $8.8m, with strength of our balance sheet a consistent focus.

• Net Working Capital (NWC): During the year our NWC increased to $76.9 million due to the continued investment into inventory to support revenue growth, with the vast majority contributed by the addition of EX Engineering and CMI Operations.

• Cash Flow: Operating free cash flow conversion rose a significant 37ppt, from 51% in FY23 to 88% in FY24.

4 IPD Group Annual Report 2024

Acquisitions

During the year we added two high-quality businesses to IPD Group: EX Engineering and CMI Operations.

• EX Engineering is a Perth-based business that specialises in the design, stocking, supply, modification, and repair of electrical hazardous area equipment (known as Ex equipment). This work involves a critical focus on safety, including adherence to rigorous certification processes, which results in significant barriers to entry to this segment. During the year work began to expand IPD’s hazardous area capabilities into the east coast at Wetherill Park, with IPD now set up and assembling level one hazardous area equipment. The business was acquired in July 2023 for total consideration of $11.4 million.

• CMI Operations is a leading distributor of electrical cables and manufacturer and distributor of plug brands in Australia, from ASX-listed Excelsior Capital Limited (ASX:ECL). The CMI Operations acquisition extends IPD’s product suite, increases supplier diversity, strengthens its overall value proposition with existing customers, and broadens customer reach. It was funded through a combination of a fully-underwritten $65m equity raising and a new $40 million debt facility. The business was acquired in January 2024 for total consideration of $92.1 million.

IPD Group well positioned to continue supporting Data Centre growth

IPD Group has a longstanding history of supporting leading local and global data centre companies with their ongoing growth. Data centres are incredibly electrically dense, with electrical work typically the largest component of data centre construction costs. Our unique product and service offering means we are well placed to execute across every step of the value chain. This includes planning and design, product specification and supply, electrical infrastructure and installation, cooling and environmental controls, and inspections, approvals and maintenance. With cloud computing and AI developments driving exponential growth in Data Centre spend, IndustryARC expects the global data centre market to grow at a 9.6% CAGR from 2023-2030. In FY24, Data Centres represented 12% of our Revenue, and having secured large forward orders for the next 12 months we expect demand to increase by 25%. This is reflected in the buoyant outlook for our markets and is indicative of IPD Group’s ability to capitalise on multi-year megatrends.

I remain deeply grateful to our customers, employees, our suppliers, and our loyal shareholders. We look forward to continuing the success of the company in the years ahead.

Michael Sainsbury

CEO

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Revenue growth
REVENUE
$290.4m
UP BY
28.0%
In FY24, Data Centres
represented 12% of our revenue,
and having secured large
forward orders for the next
12 months we expect demand
to increase by 25%
Michael Sainsbury
CEO
IPD Group Annual Report 2024 5
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Our Strategy

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IPD Group provides end-to-end electrical solutions through its leading businesses –
Addelec, CMI Electrical, Ex Engineering, and IPD – supporting customers’ transition to
more sustainable operations..
Our mission
Our purpose
To enhance every aspect of
To help build a future infrastructure through energy
where sustainable
efficiency, automation and secure
electrical infrastructure connectivity while prioritising the
creates a better life for all. safety and wellbeing of people.
Our 650+ team members are passionate about Our Purpose: ‘ To help build a future where sustainable electrical
infrastructure creates a better life for all. ’ It guides us to focus our strategy on contributing to a safer, more sustainable future
for all Australians, supported by our unique subsidiaries, customer relationships, and industry partnerships:
Significant scale and Highly recognised, Deep customer and Leading in-house Our sustainable
network for our sector: trusted customer- technical knowledge manufacturing imprint is founded
We operate one of facing brands: ensure the delivery facilities , we offer on a long history
the largest electrical Our brands in our of compliant, reliable customised solutions of operating in
distribution businesses extensive product electrical solutions that provide flexibility, regulated electrical
for the commercial and portfolio are tailored to meet quicker turnaround markets , with
industrial sectors. some of the most industry standards. times, and the ability compliance and
recognised and With extensive to meet unique project safety at the core
valued in the world. experience and requirements, adding of our culture
expertise, we provide significant value and operations.
valuable guidance, and enhancing the This commitment
helping our customers customer experience. ensures that every
navigate complex solution meets the
regulations with highest industry
confidence. standards, promoting
sustainability and
safety throughout the
business.
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6 IPD Group Annual Report 2024

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Our results:
Sustainable
shareholder
value creation
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IPD Group Annual Report 2024 7

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Our Pillars
We deliver strong returns
for our shareholders
by operating as an
interconnected group, using
our subsidiaries, customer
understanding and industry
partnerships to achieve our
mission: To enhance every
aspect of infrastructure
through energy efficiency,
automation and secure
connectivity while prioritising
the safety and wellbeing
of people.
Our strategy is built around
three core pillars.
8 IPD Group Annual Report 2024
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Business Growth

Focused on customer value, market expansion, and accelerating growth.

Customer Value & Market Expansion

We will continue to focus on leveraging our strong brand portfolio to expand into new and underserved markets. By utilising our trusted and highly recognised brands, we will provide reliable and compliant electrical solutions across various sectors. With our deep technical expertise and inhouse manufacturing capabilities, we will deliver customised solutions, offering flexibility and quicker turnaround times to meet unique customer needs.

This approach will strengthen customer relationships and drive growth, all while supporting our purpose of building sustainable, safer electrical infrastructure for a better future for all Australians.

Accelerate Growth

Our strategy will accelerate growth by prioritising capital investments that enhance earnings and strengthen our market position. These investments will drive customer value, improve operational capabilities, and expand our presence across sectors.

Strategic acquisitions will also play a key role, allowing us to integrate new businesses, expand our customer offerings, and unlock growth opportunities. This approach will boost market share, tap into underserved markets, and ensure we stay ahead in the evolving electrical industry.

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Operational Efficiency

Building scalable operations and leveraging our synergies and emerging technologies.

Scalable Operations

We prioritise scaling our operations by leveraging the Group’s integrated shared services model to drive cost savings. By centralising key functions across our subsidiaries, we streamline processes, improve efficiency, and reduce duplication.

Additionally, we aim to enhance operational effectiveness by maximising economies of scale. Our significant scale and network allow us to consolidate resources, achieve greater purchasing power, optimise production, and expand our reach across industries. This approach enables us to deliver high-value, compliant, and reliable electrical solutions while strengthening our market presence.

Synergies & Emerging Technologies

Focus on leveraging internal and external synergies to maximise value creation while staying ahead of industry trends through the early identification of emerging technologies. By capitalising on the combined strengths of our subsidiaries, partners, and customers, we can create collaborative solutions that add significant value to our offerings.

Moreover, keeping a pulse on market trends and emerging technologies allows us to capture new opportunities and ensure that our solutions remain cutting-edge and adaptable. Our extensive experience, significant network, and trusted brands enable us to seamlessly integrate new advancements and deliver innovative, reliable electrical solutions, positioning us for continued success in a rapidly evolving market.

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Sustainability

Committing to sustainable and responsible impact, driven by a purpose-driven culture.

Sustainable & Responsible Impact

At IPD, we will always maintain a laser focus on responsibility, safety, compliance, and sustainability. We are committed to ensuring that all our initiatives contribute positively to both the environment and society, with a strong emphasis on safety and adherence to regulatory standards.

As we grow, we will align our innovations with long-term environmental and social goals. By prioritising sustainability in our business strategies, we ensure that our development supports the global transition to a cleaner, safer future.

One Team with Purpose-Driven Culture

Our strategy for fostering a purpose-driven culture begins with cultivating a highly engaged team that embodies the company’s values. We believe that when our people are aligned with our purpose, they become more motivated, committed, and able to contribute meaningfully to the company’s success.

Building a culture centered around purpose also supports our strategic goals. By empowering our team to take ownership of their roles and align their efforts with our vision, we create a more cohesive and focused workforce that drives collective success.

We aim to leverage our deep customer and technical knowledge to ensure our people are equipped with the tools, knowledge, and support they need.

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IPD Group Annual Report 2024

Our Connected Group

IPD Groups is well positioned in the energy transition, supported by strong fundamentals and alignment with key megatrends. Our interconnected businesses offer a unique value proposition, delivering customer value across the entire value chain. This synergy drives long-term accelerated sustainable growth.

Megatrends

Geopolitical shifts

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With global reach and local adaptability IPD can quickly respond to changing regulations and regional energy demands.

Urbanisation

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IPD’s smart solutions and energy-efficient systems provide scalable infrastructure to support the growth of urban areas.

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Sustainability

Aligned with the global push for greener operations, IPD is driving sustainable energy management and supporting the shift toward net-zero carbon.

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Electrification

IPD’s innovative solution will accelerate the shift from fossil fuels to renewable electric energy in industries and infrastructure.

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Digital & technological transformation

With expertise in automation and digital solutions, IPD is leading the way in optimising energy use and operational efficiency.

10 IPD Group Annual Report 2024

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Our unique value proposition
Load Analysis
System
& System
Upgrades Requirements Product specification
& supply
Electrical
Preventive
System
Maintenence
Architecture
Ongoing Compliance
Monitoring & Standards
& Analytics Alignment
Customer
Compliance Compliance Engineering
Verification Verification & installation
Project Power
Manage Quality
& Installation Assurance
System
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Commissioning
Testing
Maintenance, repair
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IPD Group Annual Report 2024 11

Our Connected Group continued

NPS Growth reflects strong customer satisfaction

Voice of Our Customers Commendable NPS Score

In FY24, our Net Promoter Score (NPS) improved to 32.9%, a significant rise from 30.2% in FY23. This positive trend in customer satisfaction and engagement spans all our subsidiaries, underscoring the effectiveness of our customer-centric strategies. In the B2B industry, an NPS between 30-40% is regarded as strong, indicative of solid customer loyalty and validating our approach to prioritising customer relationships.

32.9%

Diversified Revenue

Our diverse technology portfolio has strengthened Group performance across targeted sectors. We are actively expanding our offerings to meet the demands of digital transformation and mitigate market risks. This approach ensures stable growth by catering to various markets with multiple technologies.

FY24 Revenue by Product Type

FY24 Revenue by End Market

Commercial Construction/ Buildings – 37% Infrastructure/Industrial/ Mining – 23% Data Centres – 12% Water & Waste Water – 11% Power Utilities – 6% Food & Beverage – 3% Residential Construction – 1% Others – 7%

Power Distribution - 43% Automation & Communication – 12% Cable – 12% Motor Control – 10% Hazardous Area Equipment – 10% Services – 7% Power Monitoring – 5% Others – 1%

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IPD Group Annual Report 2024

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IPD Group Annual Report 2024 13

Business Review

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14 IPD Group Annual Report 2024

Experts in Power Distribution, Motor Control, Automation & Energy Efficiency

IPD stands as a key player in Australia’s electrical engineering landscape, dedicated to providing innovative solutions tailored to a broad range of industrial needs. With a focus on electrical products and systems integration, IPD serves a diverse clientele across sectors such as manufacturing, infrastructure, and commercial projects. The company excels in delivering comprehensive services from system design to implementation, driven by a commitment to sustainability and efficiency. IPD’s market leading product offerings include motor control, power distribution, and automation systems, all designed to enhance operational efficiency and safety for its customers.

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Initiatives & Highlights

Demand Creation and Specification: Building relationships through the Strategic Solutions Team, targeting key segments like Mining, Data Centres, water and waste water.

Collaborative Opportunities: Partnering with ABB Electrification to capture key opportunities, especially in the Data Centre segment.

Sales Organisation Restructuring: Revamping the sales structure to support growth and better serve customers across Strategic Solutions, Buildings and Infrastructure, Industry, and Wholesale.

ABB Motors Master Distributorship: Strengthening and expanding the ABB Motors Master Distributorship.

Improved Logistics: Introduced a new provider with automated management, enhanced capacity, and advanced technology for faster, more reliable, and transparent deliveries.

Major Projects

Global Leader in Data Centres: Secured large forward orders for the next 12 months; demand projected to increase by 25%.

National Car Dealership Group: Supplied EV chargers to LSH dealerships in Sydney, Melbourne, and Brisbane; providing customer EV charger solutions for SMART Electric Car buyers.

Powerhouse Museum Parramatta: Supplied ABB low voltage switchgear and distribution boards.

Harbourside Darling Harbour: Received order for busduct system supply.

Renewables: Goulburn River Solar, Bundaberg (Ewia) Solar Farm, and Melton Battery Farm, where we supplied Hirschmann Industrial Communications solutions.

IPD Group Annual Report 2024

15

Business Review continued

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16 IPD Group Annual Report 2024

Driving Sustainable Electrical Infrastructure

Addelec is a leading provider of comprehensive electrical engineering solutions across Australia. Specialising in both high and low voltage installations and maintenance, Addelec caters to diverse sectors including utilities, industrial, and commercial projects, ensuring safety and efficiency across all services. With a particular focus on cutting-edge electric vehicle charging solutions, Addelec designs and implements complete EV infrastructure tailored for commercial and multi-residential use. Their expertise in electrical engineering and sustainable energy drives innovation, aiming to empower a cleaner, more connected future.

Initiatives & Highlights

Integrated Brand and Expanded Reach: Integrated Gemtek into Addelec with new branding as of 1 July; expanded services to QLD, now covering NSW, VIC, TAS, QLD, and WA.

Turnkey Solutions and Market Leadership: Provides comprehensive turnkey EV charging solutions with a national footprint and is recognised as a leader in the EV infrastructure space.

New Product Alliances: Formed new partnerships with eLumina and Kempower, enhancing the range of bestin-class products.

Strong Industry Relationships: Connections with key industry players including NRMA, Evenergi, RAC, Chargefox, Transit Systems, ABB, and BGIS.

Major Projects

PTA/Programmed FM – Malaga Bus Depot: Awarded contract to provide EV charging; project to be delivered and invoiced within the fiscal year.

NRMA: Received 21 POs for site engineering and construction across multiple States.

eLumina: Secured sale of 14 eLumina battery backed high power chargers to NRMA for deployment across Australia.

University of Wollongong P8 Carpark Charging Station: Awarded grant for 3 super-fast EV chargers; project includes installation of ABB Terra chargers and related works.

Cloud Carrier: Completed HV reticulation design and construction for Cloud Centre data centre.

Strategic Ambition: Expanding our market position in EV charging solutions by leveraging our established expertise in data centers and high-voltage systems, positioning us as a market leader in Australia.

IPD Group Annual Report 2024

17

Business Review continued

Trusted in Electrical Safety for Hazardous Areas

Ex Engineering is a specialist in electrical equipment for hazardous areas, providing expert solutions tailored to high-risk environments. The company focuses on the design, supply, and maintenance of electrical products that meet stringent safety standards required for explosive atmospheres. Their offerings range from custom modifications to full-system implementations, ensuring compliance with international certifications. Ex Engineering’s dedication to innovation and safety supports industries such as mining, oil and gas, and chemical processing, where robust and reliable electrical solutions are crucial for both operational efficiency and worker safety.

Initiatives & Highlights

Increased Workshop Demand: Achieved a 21% increase in workshop builds compared to the previous year.

Expansion to East Coast: Expanded Ex Engineering to the East Coast, including the incorporation of the East Coast workshop.

National Stock Management: Reviewed and aligned stock management, margins, pricing, and sales structures on a national level.

Major Projects

Global Energy Company Supply Contract: Ongoing support with a recent contract extension.

CBH Supply Contract: Continued support with a recent contract extension.

CBH Storage Upgrades: Delivered storage upgrades and rail loading expansions.

Callide Power Station Upgrades: Provided equipment sourcing and customised equipment supply.

System and Process Alignment: Aligned systems and processes around STAHL assembly, focusing on compliance and productivity.

National Market Presence: Enhanced national market presence while maintaining high customer service and compliance standards.

18 IPD Group Annual Report 2024

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IPD Group Annual Report 2024 19

Business Review continued

Leaders in Safe and Reliable Power Connections

CMI Electrical is a leading Australian manufacturer and distributor, specialising in electrical cables and hazardous area plugs and receptacles for various industrial applications. With a focus on mining, infrastructure, and commercial projects, CMI Electrical provides high-quality solutions designed to meet the demands of harsh and hazardous environments. The company’s product line includes electrical cables, heavy-duty industrial plugs, and cable coupler systems, all backed by robust customer service and technical support. As a leader in electrical solutions, CMI Electrical is dedicated to enhancing the safety and efficiency of electrical installations across the Southeast Asia and Oceania regions.

Initiatives & Highlights

Continued Expansion: Expanding into Mongolia and Indonesia to tap into compatible markets.

Sustainability Advancement: Introducing an 11kV mining coupler to help the resource sector reduce fossil fuel use.

Technological Innovation: Enhancing Minto mining products through improved safety, reduced weight, and streamlined installation.

Market Share Growth: Expanding in Australia’s electrical cable sector with new complementary products.

Global Opportunities: Exploring new international markets for the Minto mining plug range.

Major Projects

Western Sydney Harbour Tunnel: Supplied high-voltage plugs and cable for critical infrastructure.

HMAS Cairns: Provided extensive cable supply for naval infrastructure upgrades.

North Head Bio Solids: Delivered specialised cable solutions for bio solids processing facilities.

Chatswood Chase: Supplied cables for major retail and commercial redevelopment.

360 Queen Street: Provided cable solutions for a highrise commercial building project.

North Goonyella Underground Mine: Supplied mining plugs for underground operations, enhancing safety and efficiency.

20 IPD Group Annual Report 2024

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IPD Group Annual Report 2024 21

Our People & Sustainability

At IPD Group, we are dedicated to integrating environmental, social, and governance considerations into our daily operations, aligning with our mission to contribute to a sustainable future and create lasting value for our stakeholders. To support these practices, we maintain a comprehensive risk register that identifies key risks and outlines controls and mitigation strategies. The Audit and Risk Committee regularly reviews this register to ensure significant risks are effectively managed, reinforcing our commitment to responsible and sustainable growth.

Our people are not just the heart of IPD Group, they are the driving force behind our success.

EMPLOYEES

664

IPD employees

LTIFR

1.9

Lost time injury frequency rate

SCORE OF

35%

Employee NPS score – strong result well above industry benchmarks indicating a healthy, positive work environment

LOST TIME INJURY

400

Now over 400 days since last LTI

22 IPD Group Annual Report 2024

Creating a positive imprint

• Repurposed timber for Australian flooring production.

• Replaced polystyrene packing with corrugated cardboard, eliminating 160m³ of landfill waste.

• Use 100% recycled paper for packing.

• Switched to reusable transport crates, reducing single-use void fill.

• “Roll Up Your Sleeves” initiative at IPD Colombo collected 21 pints of blood through a successful employee-driven fundraising campaign.

• Support for employee-selected charities, including cancer research and The Salvation Army.

• On-going commitment to Employee Assistance Program (EAP).

• Delivered training in engineering, IT, finance, and logistics to students from eight leading universities, enhancing their professional skills and industry knowledge.

• Phased out single-use plastics; using recycled shrink wrap.

• Installed EV charging stations at key sites with expansion plans.

• IPD Colombo planted Terminalia bellerica trees on-site and along riverbanks, enhancing community health and environmental sustainability.

• Installed LED lighting at six sites

• Establishing IPD funded training labs at the University of Moratuwa and SLIIT in Sri Lanka.

IPD Group conducted a thorough review of environmental and social risks for the financial year ending 30 June 2024 and confirms that no material exposures were identified. We remain committed to actively monitoring and managing any potential risks to uphold our sustainability commitments.

23

IPD Group Annual Report 2024

Our People & Sustainability continued

How IPD & ABB are using sustainable packaging to reduce waste

IPD Group is committed to becoming a more sustainable company, continually embedding sustainability in all aspects of our operations. A key focus is on ‘circularity’, aiming to minimise waste by maximising the lifecycle of products and materials.

ABB, our largest supplier partner, collaborates closely with us in Australia to adopt sustainable packaging practices that significantly reduce, reuse, and recycle materials. This collaboration has led to a notable decrease in packaging waste.

True Partnership Approach

Sustainability has long been a strategic focus for IPD, as we report to the Australian Packaging Covenant Organisation (APCO) on our waste management and recycling strategies. “We are focused on enhancing sustainable packaging around the protection and materials used in our range,” says Patric Stromquist, General Manager of Operations at IPD Group.

Patric’s team identified an opportunity to improve packaging efficiency with ABB. Excessive packaging materials from the ABB warehouse were being wasted. This led to a collaborative effort to optimise sustainable practices. Inspired by reusable plastic crates used in supermarket home deliveries, IPD decided to implement these for our deliveries from ABB. After a successful trial with 200 crates, these have now replaced disposable packing materials.

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24 IPD Group Annual Report 2024

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Saving Time & Improving Efficiency

ABB is our largest supplier and we work with them very closely in a number of ways, and sustainability comes into play here as well.

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Switching to reusable crates for shipping from ABB has reduced our use of disposable packaging materials. “Previously, unpacking and processing were timeconsuming. Now, we use the same crates from shipping through to storage, which saves time and reduces waste,” explains Patric.

After use, the crates are flat-packed and returned to ABB’s Moorebank warehouse for reuse. Paulette Halabi, Sales Operations Manager at ABB Australia, notes, “This change has cut our need for cartons and packaging tape for these shipments by about 20% in the past year.”

Expanding the Circular Approach

The success with crates has encouraged further sustainable initiatives, like replacing plastic void fill in packaging with recyclable paper. “This 100% recyclable paper can be reused, reducing our reliance on non-sustainable materials,” says Paulette.

Through these sustainable packaging practices, IPD and ABB are exemplifying ‘circularity in action’, significantly advancing our sustainability goals.

IPD Group Annual Report 2024 25

Financial Report for the year ended 30 June 2024

Contents

Contents
Directors’ Report	27
Auditor’s Independence Declaration	42
Independent Auditor’s Report	43
Directors’ Declaration	50
Consolidated Financial Statements	51
Notes to the Financial Statements	57
Consolidated Entity Disclosure Statement	96

20 24

IPD Group Annual Report 2024

Directors’ Report

The Directors present their report in compliance with the provisions of the Corporations Act 2001 on the consolidated entity (referred to hereafter as the Group) consisting of IPD Group Ltd (IPD Group or the Company) and the entities it controlled at the end of, or during, the year ended 30 June 2024.

Directors

Directors of IPD Group Ltd during and since the end of the financial year unless otherwise stated below are: David Rafter – Independent non-executive Chairman

Andrew Moffat – Independent non-executive Director

Michael Sainsbury – Executive Director

Mohamed Yoosuff – Executive Director

Company Secretary

Jade Cook

Corporate Governance

The Board of Directors and management of IPD Group recognise the importance of, and are committed to, achieving high corporate governance standards. Our key Corporate Governance materials including policies, code of conduct and Board Committee Charters, can be found in the Corporate Governance section of our website within the Investor Relation section.

In accordance with the 4th edition of the ASX Corporate Governance Council’s Principles and Recommendations, the Company’s Corporate Governance Statement, as approved by the Board, is published and available on the IPD Group’s website at - https://ipdgroup.com.au/investors/corporate governance/

Principal Activities

The Group is a national distributor and service provider to the Australian electrical market. The Group consists of two core divisions:

• the distribution of products for quality global electrical infrastructure brands such as ABB, Elsteel, Emerson & Red Lion; and

• the provision of services, including installation and commissioning, calibration and testing, maintenance and repairs and refurbishment.

Products division:

The Group’s core focus in the products division is the sale of electrical infrastructure products to customers including switchboard manufacturers, electrical wholesalers, electrical contractors, power utilities, OEMs and system integrators. Within the division there are five key categories of products:

• Power distribution;

• Industrial and motor control;

• Automation and industrial communication;

• Power monitoring; and

• Hazardous area equipment.

• Electrical cables, manufacture & distribution of cable plugs.

In addition to selling products, the Group provides a range of value-added services, including custom assembly, sourcing, engineering design, technical compliance, procurement, transport, storage, regulatory management, technical support, packaging, labelling, inventory management and delivery.

27

IPD Group Annual Report 2024

Directors’ Report continued

Review of Operations continued

Services division:

Within the Group’s services division there are four categories of services:

• Installation and commissioning;

• Calibration and testing;

• Maintenance and repairs;

• Electric vehicle solutions; and

• Refurbishment and other.

Review of Operations

Review of Operations
Year ended	Year ended
30 June 2024	30 June 2023	Movement
$ million	$ million	%
Revenue from ordinary activities 290.4	226.9	28.0%
Gross profit 107.8	86.8	24.2%
Other income 0.2	0.6	(66.7%)
Operating Expenses (excluding acquisition costs) (67.9)	(59.7)	13.7%
Underlying EBITDA1 40.1	27.7	44.8%
Depreciation and amortisation expenses (5.8)	(4.3)	34.9%
Underlying EBIT1 34.3	23.4	46.6%
Interest (0.7)	(0.2)	250.0%
Underlying profit before income tax1 33.6	23.2	44.8%
Income tax expense (10.3)	(7.1)	45.1%
Underlying NPAT1 23.3	16.1	44.7%

1. Underlying EBITDA, EBIT, Profit before tax and NPAT from ordinary activities is a non-IFRS measure reported to provide a greater understanding of business performance. Underlying EBITDA, EBIT and Profit before tax have been arrived at by adding back acquisition related costs totalling $1,221,000. Underlying NPAT from ordinary activities has been arrived at by adding back acquisition related costs after tax totalling $855,000.

28 IPD Group Annual Report 2024

	Year Ended	Year Ended
	30 June 2024 $	30 June 2023
Underlying NPAT bridge entries	million	$ million
NPAT Statutory	22.4	16.1
Acquisition costs	1.2	–
Less tax effect of Acquisition costs	(0.3)	–
Underlying NPAT from ordinary activities	23.3	16.1

The IPD Group Board of Directors are pleased to advise a record performance for the financial year ended 30 June 2024.

Delivered record revenues and earnings for the financial year ended 30 June 2024. Sales revenue of $290.4 million was up 28.0% on the pcp, while underlying NPAT of $23.3 million was up 44.7% on the pcp.

Completed two key strategic acquisitions:

• On 21 July 2023, IPD acquired EX Engineering, a Perth-based business that specialises in the design, stocking, supply, modification, and repair of electrical hazardous area equipment (known as Ex equipment). This work involves a critical focus on safety, including adherence to rigorous certification processes, which results in significant barriers to entry to this segment. Work has commenced on expanding IPD’s hazardous area capabilities into the east coast at Wetherill Park, with IPD now set up and assembling level one hazardous area equipment.

• On 31 January 2024, IPD acquired CMI Operations, a leading distributor of electrical cables and manufacturer & distributor of plug brands in Australia, from ASX-listed Excelsior Capital Limited (ASX:ECL) for total consideration of $92.1 million, subject to customary working capital and net debt adjustment. The CMI Operations acquisition was funded through a combination of a fully-underwritten $65 million equity raising and a new $40 million debt facility. The CMI Operations acquisition extends IPD’s product suite, increases supplier diversity, strengthens its overall value proposition with existing customers, and broadens customer reach.

As expected, CMI Operations’ lower operating gross profit margins have had a dilutive impact on consolidated gross profit margins, resulting in a 1.1% reduction on the pcp. The relatively lower operating costs of EX Engineering and CMI Operations have contributed to the Group’s increasing EBITDA, EBIT and NPAT margins. Both acquisitions will continue to have an accretive impact on the consolidated group EBITDA, EBIT and NPAT margins.

Enhancing its EV infrastructure team by merging Addelec and Gemtek to capitalise on the growing EV infrastructure market. The integration was completed on 1 July 2024, with this integration anticipated to boost operational efficiencies. Post-integration, the merged business is poised to meet the increasing demand for efficient electrical infrastructure within the sustainable energy sector.

Underlying operating expense (excluding acquisition-related costs) as a percentage of revenue decreased by 2.7% on the pcp as a result of the lower operating costs from EX Engineering and CMI Operations. There is an ongoing focus on enhancing operational efficiency by maximising economies of scale across the organisation and leveraging internal and external synergies to boost value creation.

Acquisition related expenses amounted to $1.2 million during FY24, with all acquisition expenses now fully recognised. Even after incurring these strategic acquisition costs, IPD continued to deliver a strengthening statutory NPAT results of $22.4 million, up 39.1% on the pcp.

As at 30 June 2024, the Group had $150.7 million of net assets on its balance sheet after the acquisition of EX Engineering and CMI Operations. In December 2023 a $65 million capital raise was successfully completed for the acquisition of CMI Operations and in January 2024 IPD entered into a new $40 million debt facility to partially fund its 100% acquisition of CMI Operations, which completed on 31 January 2024. After careful cash management, net debt has reduced to $8.8 million as at 30 June 2024.

With the combination of CMI Operations, net working capital increased to $76.9 million. Inventory increased by $29.0 million from 31 December 2023, with $28.9 million of this increase contributed by CMI Operations and EX Engineering.

Operating free cash flow conversion (Operating cash flow before interest and tax outflows) rose 37ppt, from 51% in FY23 to 88% in FY24.

29

IPD Group Annual Report 2024

Directors’ Report continued

Review of Operations continued

On 10 April 2024, the IPD Group paid an interim 2024 financial year-end dividend of $4.8 million which was equivalent to 4.6 cents per share fully franked.

On 30 August 2024, the Directors declared a final fully franked dividend of 6.2 cents per share, payable on 4 October 2024. This equates to a payout of $6.4 million.

Total dividends declared for FY24 were 10.8 cents per share (FY23 9.3 cents per share), equating to a total payout of $11.2 million and a payout ratio of 50%.

Outlook

The outlook for our markets remains buoyant, driven by the transition to renewable energy, increasing demand from data centres and their energy requirements, the growing number of EV chargers, and a supportive legislative environment.

IPD’s long-tenured senior management, best-in-class customer service, wide range of products and services, along with a strong balance sheet and strategic focus on M&A, place us in a unique position to continue our growth.

The Board will provide an update on Q1 trading performance at the IPD Group Limited AGM on 26 November 2024.

Subsequent Events

No matters or circumstances have arisen since the end of the financial year which significantly affected or could significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial years.

Meetings of Directors

Directors’ Meetings	Board Meetings Audit and Risk Committee Nomination and Remuneration Committee
	Eligible Attended Eligible Attended Eligible Attended
Mohamed Yoosuff Michael Sainsbury David Rafter Andrew Moffat	12 12 – – – – 12 12 – – – – 12 12 2 2 3 3 12 12 2 2 3 3

30 IPD Group Annual Report 2024

Information on Directors

		Relevant interest
Directors		in Shares
David Rafter	David has over 30 years’ of experience in the building services sector.	150,000
Independent, Non-Executive Chairman	Major roles across David’s career include the CEO of O’Donnell Griffn, a $600 million electrical engineering/contracting business and CEO
Master of Business Administration – Charles Sturt University Master of Design Science (Facilities Management) – University of Sydney	of Haden Engineering a $300 million HVAC construction and service company, both part of the ASX-listed Norfolk Group via an IPO in 2007. Previously, David was an Executive General Manager at Transfeld Services, an ASX-listed operations, maintenance and construction services business and the CEO at Web FM, a global provider of construction and facilities management consulting and software
	solutions.
	David was appointed as a Director on 14 August 2019 and is a member
	of the AICD.
	David is a member of the Audit and Risk Committee.
	David is chairman of the Remuneration and Nomination Committee.
Andrew Moffat	Andrew has 23 years’ of corporate and investment banking experience,	504,946
Independent, Non-Executive	including serving as a director of Equity Capital markets and Advisory for
Director	BNP Paribas Equities.
Bachelor of Business	Currently a Non-Executive Director of Sports Entertainment Group Limited,
– Curtin University	360 Capital Group Limited, ICP Funding Pty Limited and CASL Funder Pty Ltd.
	Andrew was appointed as a Director on 24 March 2020.
	Andrew is chairman of the Audit and Risk Committee.
	Andrew is a member of the Remuneration and Nomination Committee.
Michael Sainsbury	Michael has over 25 years’ experience in sales, business development	1,039,989
Executive Director & CEO	and management within the electrical industry; he joined IPD in 2013 as
Advanced Diploma Business	the National Sales Manager and has been CEO since 2015.
Management – Leadership	Prior to IPD, Michael spent over 13 years working at Schneider Electric
Management Australia	where he held various senior management roles in the electrical
	solutions and power monitoring space.
Mohamed Yoosuff	Mohamed Yoosuff has been an employee and board member of IPD	11,284,704
Executive Director of Strategic	since 2005.
Development	Mohamed Yoosuff held the position of CFO since the inception of IPD
Associate of Chartered institute	Group in 2005. On 1 January 2023 Mohamed Yoosuff was appointed
of Management Accountants	Director of Strategic Development.
(ACMA)	Previously held various senior management positions in manufacturing
	and distribution companies, including as CFO of Ludowici Group
	(a manufacturing and distribution business previously listed on ASX) and
	as Financial Controller of Otis Elevators.

31

IPD Group Annual Report 2024

Directors’ Report continued

Audited Remuneration Report

The remuneration report details the key management personnel remuneration arrangements for the consolidated entity, in accordance with the requirements of the Corporations Act 2001 and its Regulations.

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including all directors.

Directors’ interests and remuneration

Non-Executive Director remuneration

Under the Constitution, the Board may decide the total amount paid by the Company to each Director as remuneration for their services as a Director. However, under the Constitution and the ASX Listing Rules, the total amount of fees paid to all Non-Executive Directors in any financial year must not exceed the aggregate amount of Non-Executive Directors fees approved by Shareholders at the Company’s general meeting. This amount has been fixed by the Company at $400,000 per annum.

The total annual Non-Executive Directors’ fees agreed to be paid by the Company to:

• the Chairman, David Rafter is $135,400; and

• the Non-Executive Director, Andrew Moffat is $89,800.

From listing, Non-Executive Directors fees also include Committee fees of $8,000 per year for each Board Committee of which they are a Chair and a Committee fee of $2,000 for each Board Committee of which they are a non-Chair member.

All Non-Executive Directors’ fees are inclusive of statutory superannuation contributions.

Executive Director remuneration

IPD has established a number of incentive arrangements to enable attraction, motivation and retention of management and employees.

The remuneration structure for executives of the Company is a mix of fixed remuneration and at-risk, performance-based remuneration to ensure a focus on both short-term and long-term performance, and alignment with shareholder interests. This approach is designed to attract, retain and reward executives to deliver sustainable returns for shareholders.

Key terms of employment contracts

Chief Executive Officer

Details regarding the terms of employment of the CEO and Executive Director, Michael Sainsbury are set out below:

Term	Description
Remuneration	Effective from 1 July 2023, Michael Sainsbury is entitled to receive a base salary of $470,000 (exclusive of
and other	superannuation). Michael is also entitled to use of a motor vehicle, laptop and mobile phone provided by
benefits	the Company.
Short Term	For FY24, Michael was eligible for and achieved a cash bonus under IPD’s STI. The STI can range from 0% to 50% of
Incentives	Michael’s base salary (exclusive of superannuation).
Long Term	For FY24, Michael participated in IPD’s employee incentive plan (EIP) and was eligible to apply for a grant of Rights
Incentives	under the Plan. The number of Rights to be granted are calculated at 50% of Michael’s base salary, exclusive of
	superannuation.
Termination	Under Michael’s employment contract, either Michael or the Company can terminate his employment by giving
	the other party 3 months’ notice (which the Company may pay in lieu of notice of part or all of the notice period).
	The Company may also summarily terminate Michael’s employment contract in certain circumstances,
	including if Michael engages in serious misconduct, is grossly negligent or incompetent in the performance of
	his duties, if he commits any serious or persistent breach of the employment contract or any workplace policy
	or if he is charged with a criminal offence that the Company considers adversely impacts his suitability for
	employment with the Company.

32 IPD Group Annual Report 2024

Executive Director

Details regarding the terms of employment of the Director of Strategic Development and executive director, Mohamed Yoosuff, are set out below:

Term	Description
Remuneration	Effective from 1 July 2023, Mohamed Yoosuff is entitled to receive a base salary of $341,668 (exclusive of
and other	superannuation). Mohamed is also entitled to a motor vehicle allowance of $51,096 per annum and use of a
benefits	laptop and mobile phone provided by the Company.
Short Term	For FY24, Mohamed was eligible for and achieved a cash bonus under IPD’s STI. The STI can range from 0% to 50%
Incentives	of Mohamed’s base salary (exclusive of superannuation).
Long Term	For FY24, Mohamed participated in IPD’s EIP and was eligible to apply for a grant of Rights under the Plan. The
Incentives	number of Rights to be granted are calculated at 25% of Mohamed’s base salary, exclusive of superannuation.
Termination	Under Mohamed’s employment contract, either Mohamed or the Company can terminate his employment
	by giving the other party 3 months’ notice (which the Company may pay in lieu of notice of part or all of the
	notice period).
	The Company may also summarily terminate Mohamed’s employment contract in certain circumstances,
	including if Mohamed engages in serious misconduct, is grossly negligent or incompetent in the performance of
	his duties, if he commits any serious or persistent breach of the employment contract or any workplace policy
	or if he is charged with a criminal offence that the Company considers adversely impacts his suitability for
	employment with the Company.

Executive Key Management remuneration

Details regarding the terms of employment of the Chief Financial Officer (CFO), Jason Boschetti, are set out below:

Term	Description
Remuneration	Effective from 1 July 2023, Jason Boschetti was entitled to receive a salary of $315,000 (exclusive of
and other	superannuation). Jason is also entitled to use of a motor vehicle, laptop and mobile phone provided by the
benefits	Company.
Short Term	For FY24, Jason was eligible for and achieved a cash bonus under IPD’s STI. The STI can range from 0% to 50% of
Incentives	Jason’s half-year salary (exclusive of superannuation).
Long Term	For FY24, Jason participated in IPD’s EIP and was eligible to apply for a grant of Rights under the Plan. The number
Incentives	of Rights to be granted are calculated at 25% of Jason’s base salary, exclusive of superannuation.
Termination	Under Jason’s employment contract, either Jason or the Company can terminate his employment by giving the
	other party 3 months’ notice (which the Company may pay in lieu of notice of part or all of the notice period).
	The Company may also summarily terminate Jason’s employment contract in certain circumstances, including
	if Jason engages in serious misconduct, is grossly negligent or incompetent in the performance of his duties,
	if he commits any serious or persistent breach of the employment contract or any workplace policy or if he is
	charged with a criminal offence that the Company considers adversely impacts his suitability for employment
	with the Company.

33

IPD Group Annual Report 2024

Directors’ Report continued

Audited Remuneration Report continued

Executive incentive arrangements

Short-term incentives

The Company has established a short-term incentive (STI) program under which cash awards may be payable to participants, subject to the satisfaction of specified performance criteria. The Company’s executive employment contracts recognise the potential for the award of STIs in future years.

Under the STI program, the Board may, in its absolute and sole discretion, determine the participation in, the amount of and performance criteria for the STI program for any given year. Performance criteria may include:

• individual performance criteria tailored to each respective role; and/or

• the Company’s financial performance against criteria set by the Board for the relevant financial year and may include measures such as statutory or pro-forma EBITDA, EBIT or NPAT targets.

The STI for the period ended 30 June 2024 was structured on the following basis:

• Michael Sainsbury is entitled to a cash bonus under IPD’s STI award for stretch performance, measured against group EBIT performance. The maximum cash bonus for Michael for FY24 has been set at $235,000 (inclusive of superannuation), which is 50% of Michael’s base salary (exclusive of superannuation) for FY24.

• Mohamed Yoosuff is entitled to a cash bonus under IPD’s STI award for stretch performance, measured against group EBIT performance. The maximum cash bonus for Mohamed for FY24 has been set at $170,834 (inclusive of superannuation), which is 50% of Mohamed’s base salary (exclusive of superannuation) for FY4.

• Jason Boschetti is entitled to a cash bonus under IPD’s STI award for stretch performance, measured against group EBIT performance. The maximum cash bonus for Jason for FY24 has been set at $157,500 (inclusive of superannuation), which is 50% of Jason’s half year base salary (exclusive of superannuation) for FY24.

Subsequent to year end, the non-executive Directors approved the payment of the STI awards for Michael Sainsbury of $117,500, Mohamed Yoosuff of $85,417 and for Jason Boschetti of $78,750.

Equity incentives

The Company has established the EIP to assist in the motivation, reward and retention of senior management and other IPD employees from time to time. The EIP is designed to align the interests of senior management and other employees with the interests of Shareholders by providing an opportunity for employees to receive equity interests in the Company subject to the satisfaction of certain performance conditions. IPD may offer additional incentive schemes to the management and employees over time.

The EIP is a long-term incentive plan, under which options or performance rights to subscribe for or be transferred Shares (Plan Awards) may be offered to eligible employees (including a director employed in an executive capacity or any other person who is declared by the Board to be eligible) selected by the Directors at their discretion.

For the year ended 30 June 2024, the Company has granted Performance Rights to key management personnel as follows:

• Michael Sainsbury CEO and Executive Director – 56,700 Performance Rights, calculated by dividing 50% of Michael’s annual base salary by the Volume Weighted average Price (VWAP) of the company’s shares on the ASX during the 20 trading days immediately prior to 1 July 2023, rounded to the nearest whole number of Rights.

• Mohamed Yoosuff Executive Director – 20,609 Performance Rights, calculated by dividing 25% of Mohamed’s annual base salary by the Volume Weighted average Price (VWAP) of the company’s shares on the ASX during the 20 trading days immediately prior to 1 July 2023, rounded to the nearest whole number of Rights.

• Jason Boschetti – 19,001 Performance Rights, calculated by dividing 25% of Jason’s annual base salary by the Volume Weighted average Price (VWAP) of the company’s shares on the ASX during the 20 trading days immediately prior to 1 July 2023, rounded to the nearest whole number of Rights.

Michael Sainsbury and Mohamed Yoosuff (the executive directors), Jason Boschetti (executive key management) as well as other senior managers are the only employees who received Performance Rights pursuant to the FY24 award under the EIP.

Plan Awards will not be listed and may not be transferred, assigned or otherwise dealt with except with the approval of the Directors. Plan Awards will only vest where the vesting conditions (if any) and any other relevant conditions advised to the participant by the Directors have been satisfied or as otherwise permitted under the EIP. The Directors may determine such

34 IPD Group Annual Report 2024

conditions (including vesting conditions) at their discretion. An unvested Plan Award will lapse in a number of circumstances including where performance conditions (if any) are not satisfied within the relevant time period, the participant deals with the Plan Award in breach of the rules of the EIP, or in the opinion of the Directors, a participant has acted fraudulently or dishonestly.

If a participant’s employment or engagement with IPD terminates before the Plan Awards have vested, the Plan Awards that have not vested will lapse, unless the invitation provides otherwise or the Directors in their absolute discretion determine that some or all of the unvested Plan Awards will be treated in another manner. Where Plan Awards have vested prior to the termination of a participant’s employment or engagement with IPD the participant will have a period of time to exercise the vested Plan Awards before they lapse.

On the occurrence of certain events (such as the making of a takeover bid for the Company or the approval of a scheme of arrangement in relation to the Company), unless otherwise provided for in the terms of specific Plan Awards, the Directors may in their absolute discretion determine that some or all Plan Awards vest, lapse, become forfeited or are subject to amended conditions. If there are certain variations of the share capital of the Company including a capitalisation or rights issue, subdivision, consolidation or reduction in share capital, the Directors may make such adjustments as they consider appropriate under the EIP, in accordance with the provisions of the ASX Listing Rules.

Unless and until Shares are allocated following a Plan Award vesting and, where required, being exercised, the holder has no interest in those Shares and has no rights to dividends and no rights to vote at meetings of the Company. Shares issued upon vesting and, where required, exercise, of the Plan Awards will upon allotment rank equally in all respects with other Shares, except as regards any rights attaching to such Shares by reference to a record date prior to the date of their issue.

For so long as Shares are Listed, the Company will apply for quotation on ASX of the Shares issued under the EIP. No Plan Awards or Share may be offered under the EIP if to do so would contravene the Corporations Act, the ASX Listing Rules or instruments of relief issued by ASIC from time to time. The EIP provide the Board with broad clawback powers if, for example, the participant has acted fraudulently or dishonestly, or is in breach of his or her obligations to IPD.

The Board may at any time amend all or any provisions of the EIP or the terms or conditions of any Plan Award granted under the EIP, subject to limited restrictions on amendments that adversely affect the existing rights of a holder of Plan Awards. The exercise by the Board of any discretion granted under the EIP or the terms of a Plan Award will not constitute an amendment of the provisions of the EIP. The Board may at any time waive in whole or in part any terms or conditions (including any vesting conditions) in relation to any Plan Awards granted under the EIP. The Board may, at any time, terminate or suspend the EIP.

The Key Terms of the current award under the EIP are summarised in the table below.

Vesting conditions The Performance Rights are subject to performance conditions as follows:

• 50% of a Participant’s Performance Rights will be tested against the Company’s total shareholder return (TSR) for FY24 in comparison to the TSR achieved by a comparator group (TSR Rights); and

• 50% of a Participant’s Performance Rights will be tested against the Company’s NPAT for FY24 (NPAT Rights).

In addition to these performance conditions, the Performance Rights will only vest at their respective Vesting Date.

Performance conditions

TSR Rights

The Company’s TSR will be assessed against the performance of the companies included in the S&P/ASX Small Ordinaries Index over the relevant performance period.

The performance period is the period from 1 July 2023 to 30 June 2024.

NPAT Rights

The Company’s NPAT will be calculated using the Company’s financial performance as reported in the Company’s audited full year audited results for FY24, excluding:

• one-off or extraordinary revenue items;

• revenue received in the form of government grants, allowances, rebates or other hand-outs;

• revenue or profit that has been ‘manufactured’ to achieve the performance condition; and

• profits and acquisition related expenses from any unbudgeted acquisitions completed during FY24.

IPD Group Annual Report 2024 35

Directors’ Report continued

Audited Remuneration Report continued

Audited Remu	neration Report continued
Vesting conditions	Vesting Date
continued	In addition, even if either of the performance conditions are satisfed, Performance Rights will only vest if the Participant continues to be employed by the Company and has not given notice on the following dates:
	• 1/3 of a Participant’s Performance Rights that have satisfed the relevant performance condition will
	vest on 30 September 2024;
	• 1/3 of a Participant’s Performance Rights that have satisfed the relevant performance condition will
	vest on 30 September 2025; and
	• 1/3 of a Participant’s Performance Rights that have satisfed the relevant performance condition will
	vest on 30 September 2026,
	(with each of 30 September 2024, 30 September 2025 and 30 September 2026 being aVesting Date).
	Calculation of the performance conditions and achievement against the performance conditions and
	vesting schedule will be determined by the Board in its absolute discretion, having regard to any matters
	that it considers relevant (subject to the stated exclusions from NPAT calculations applying in all cases).
Why were the	Performance conditions
vesting conditions	The performance condition for the TSR Rights was chosen to align the interests of the executives and
chosen?	senior management with shareholder interests in optimising TSR (including the value of any dividend)
	and achieving TSR when compared to a comparator group of listed companies. The Board believes
	that TSR is an appropriate performance condition as it links executive reward to the Company’s relative
	share performance which is consistent with creating shareholder value relative to the Company’s peer
	group. The Board believes that the S&P/ASX Small Ordinaries Index represents an appropriate comparator
	group of listed companies as it represents a meaningful statistical sample and an appropriate group of
	alternative potential investments for shareholders with which to compare the Company’s performance.
	The performance conditions for the NPAT Rights were chosen to align the interests of the executives
	and senior management with shareholder interests in optimising the potential funds of the Company
	available for distribution to Shareholders as dividends and to provide an incentive for the executives to
	focus on the Company’s effective management of, treasury and tax matters.
	Vesting Dates
	The Vesting Dates have been set to assist the Company in the ongoing retention of the executives and
	senior management.
Vesting and expiry	Unless the Board exercises a discretion available to it under the EIP:
of Performance Rights	• in the event that either performance condition is not achieved, the Performance Rights relating to that performance condition will lapse; and
	• if the Participant ceases to be employed or has given notice before any of the Vesting Dates, the
	Performance Rights that have not yet vested at that time will lapse.
	Otherwise, Performance Rights will vest on satisfaction of both the relevant performance condition and
	the Participant’s continued employment (without having given notice) at the relevant Vesting Date for the
	Performance Right.
Cash settlement	On vesting, the Company may exercise its discretion to make cash payments in lieu of allocating Shares
	to satisfy the Performance Rights.
Change of	In the event of a change of control of the Company, the Board may determine that the Performance
control and other	Rights vest in accordance with the EIP, notwithstanding that the performance milestones have not been
circumstances	achieved, but only if the change of control of the Company is triggered by a person who does not control
which may trigger	the Company at the time the Performance Rights are issued achieving control of more than 50% of the
early vesting	ordinary voting securities in the Company.

The Plan Awards issued under the EIP are the Performance Rights referred to above.

36 IPD Group Annual Report 2024

Other information about Directors’ interests and benefits

Directors are reimbursed for properly documented and incurred travelling and other expenses in connection with and returning from Board or Committee meetings and general meetings. Non-Executive Directors may be paid such additional remuneration as the Directors consider to be appropriate where a Director performs extra services which are in addition to the ordinary duties of a director of the Company.

There are no retirement benefit schemes for Directors, other than statutory superannuation contributions. Chapter 2E of the Corporations Act prohibits a company from giving a financial benefit to a related party (including any Director) without the prior approval of its members by ordinary resolution, unless an exemption applies.

Amounts of remuneration

Details of the remuneration of key management personnel of the consolidated entity for the year ended 30 June 2024 are set out below:

			Non-
			monetary	Super-	Long Term	Equity
	Base salary	STI	Benefits	annuation	Benefits	settled	Total
2024	$	$	$	$	$	$	$
Non-executive directors
David Rafter	121,982	–	–	13,418	–	–	135,400
Andrew Moffat	80,901	–	–	8,899	–	–	89,800
Total	202,883	–	–	22,317	–	–	225,200
Executive directors
Michael Sainsbury	494,200	117,500	41,681	27,500	12,755	235,000	928,636
Mohamed Yoosuff	396,690	85,417	–	39,278	5,711	85,417	612,513
Total	890,890	202,917	41,681	66,778	18,466	320,417	1,541,149
Executive key management
Jason Boschetti	322,150	78,750	–	27,500	–	78,750	507,150
Total	322,150	78,750	–	27,500	–	78,750	507,150

37

IPD Group Annual Report 2024

Directors’ Report continued

Audited Remuneration Report continued

			Non-
			monetary	Super-	Long Term	Equity
	Base salary	STI	Benefits	annuation	Benefits	settled	Total
2023	$	$	$	$	$	$	$
Non-executive directors
David Rafter	108,597	–	–	11,403	–	–	120,000
Andrew Moffat	72,398	–	–	7,602	–	–	80,000
Total	180,995	–	–	19,005	–	–	200,000
Executive directors
Michael Sainsbury	458,700	220,000	37,202	27,500	11,438	220,000	974,840
Mohamed Yoosuff	401,139	170,834	–	27,500	10,536	85,417	695,426
Total	859,839	390,834	37,202	55,000	21,974	305,417	1,670,266
Executive key management
Jason Boschetti	145,000	72,500	–	22,838	–	–	240,338
Total	145,000	72,500	–	22,838	–	–	240,338

The proportion of remuneration linked to performance and the fixed proportion are as follows:

	Fixed
	Remuneration	At risk – STI	At risk – LTI
2024	$	$	$
Non-executive directors
David Rafter	135,400	–	–
Andrew Moffat	89,800	–	–
Executive directors
Michael Sainsbury	576,136	117,500	235,000
Mohamed Yoosuff	441,679	85,417	85,417
Executive key management
Jason Boschetti	349,650	78,750	78,750

38 IPD Group Annual Report 2024

The proportion of remuneration linked to performance and the fixed proportion are as follows:

	Fixed
	Remuneration	At risk – STI	At risk – LTI
2023	$	$	$
Non-executive directors
David Rafter	120,000	–	–
Andrew Moffat	80,000	–	–
Executive directors
Michael Sainsbury	534,840	220,000	220,000
Mohamed Yoosuff	439,175	170,834	85,417
Executive key management
Jason Boschetti	145,000	72,500	–

Shareholding

The number of shares in the Company held during the financial year by each director and other members of key management personnel of the consolidated entity, including their personally related parties, is set out below:

	Balance	Received			Balance
	at the start	as part of			at the end
Shares	of the year	remuneration	Additions	Disposals	of the year
Non-executive directors
David Rafter	145,834	–	4,166	–	150,000
Andrew Moffat	450,091	–	54,855	–	504,946
Executive directors
Michael Sainsbury	1,265,480	102,063	25,446	(353,000)	1,039,989
Mohamed Yoosuff	11,244,480	40,224	–	–	11,284,704
Executive key management
Jason Boschetti	833	8,866	36,908	–	46,607

IPD Group Annual Report 2024 39

Directors’ Report continued

Audited Remuneration Report continued

Performance Rights

The number of performance rights in the company held during the financial year by each director and other members of key management personnel of the consolidated entity, including their personally related parties, is set out below:

	Balance			Balance
	at the start			at the end
Performance Rights	of the year	Granted	Exercised	of the year
Executive directors
Michael Sainsbury	248,969	56,700	(102,063)	203,606
Mohamed Yoosuff	97,859	20,609	(40,224)	78,244
Executive key management
Jason Boschetti	26,599	19,001	(8,866)	36,734

Share based payments

The table below discloses the number of outstanding performance rights and share based payments granted during the current financial year.

					Grant date
	Financial	Performance	Effective grant	Number	fair value
	Year	rights series	date	granted	$	Vesting date
Executive directors
Michael Sainsbury	2024	Tranche 1	8/12/2023	18,900	61,499	30/09/2024
	2024	Tranche 2	8/12/2023	18,900	61,499	30/09/2025
	2024	Tranche 3	8/12/2023	18,900	61,499	30/09/2026
Mohamed Yoosuff	2024	Tranche 1	8/12/2023	6,870	22,354	30/09/2024
	2024	Tranche 2	8/12/2023	6,870	22,354	30/09/2025
	2024	Tranche 3	8/12/2023	6,869	22,351	30/09/2026
Jason Boschetti	2024	Tranche 1	8/12/2023	6,334	20,610	30/09/2024
	2024	Tranche 2	8/12/2023	6,334	20,610	30/09/2025
	2024	Tranche 3	8/12/2023	6,333	20,607	30/09/2026
Michael Sainsbury	2023	Tranche 2	9/12/2022	44,841	73,333	30/09/2024
	2023	Tranche 3	9/12/2022	44,842	73,335	30/09/2025
Mohamed Yoosuff	2023	Tranche 2	9/12/2022	17,410	28,472	30/09/2024
	2023	Tranche 3	9/12/2022	17,410	28,472	30/09/2025
Jason Boschetti	2023	Tranche 2	9/12/2022	8,866	14,499	30/09/2024
	2023	Tranche 3	9/12/2022	8,867	14,501	30/09/2025
Michael Sainsbury	2022	Tranche 3	9/11/2021	57,223	68,668	30/09/2024
Mohamed Yoosuff	2022	Tranche 3	9/11/2021	22,815	27,378	30/09/2024

Michael Sainsbury was issued 102,063 shares, Mohamed Yoosuff was issued 40,224 and Jason Boschetti was issued 8,866 shares during the financial year ended 30 June 2024.

This concludes the remuneration report, which has been audited.

40 IPD Group Annual Report 2024

Indemnification of Officers and Auditors

During the financial period, the Company paid a premium in respect of a contract insuring Directors of the Company, the Company secretary, and all executive officers of the Company and of any related body corporate against a liability incurred as such a director, secretary or executive officer to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium.

The Company has not otherwise, during or since the end of the financial period, except to the extent permitted by law, indemnified or agreed to indemnify an officer or auditor of the company or of any related body corporate against a liability incurred as such an officer or auditor.

Auditor’s Independence Declaration

The auditor’s independence declaration is included on page 42 of the financial report.

Proceedings on behalf of the company

No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the company, or to intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the company for all or part of those proceedings.

Non-audit services

Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the auditor are outlined in note 24 to the financial statements.

The directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another person or firm on the auditor’s behalf), is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001.

The directors are of the opinion that the services as disclosed in note 24 to the financial statements do not compromise the external auditor’s independence requirements of the Corporations Act 2001 for the following reasons:

• all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of the auditor; and

• none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants issued by the Accounting Professional and Ethical Standards Board, including reviewing or auditing the auditor’s own work, acting in a management or decision-making capacity for the company, acting as advocate for the company or jointly sharing economic risks and rewards.

Rounding off of amounts

The Company is a company of the kind referred to in the Class order 2016/191 - ASIC Corporations (Rounding in Financial/ Directors’ Reports) Instrument 2016/191 , dated 24 March 2016, and in accordance with that Class Order amounts in the Directors’ report and the consolidated financial statements are rounded off to the nearest thousand dollars, unless otherwise indicated.

This Directors’ report is signed in accordance with a resolution of Directors made pursuant to s298 (2) (a) of the Corporations Act 2001.

On behalf of the Directors

==> picture [55 x 33] intentionally omitted <==

David Rafter Director Sydney, 30 August 2024

==> picture [76 x 32] intentionally omitted <==

Michael Sainsbury Director Sydney, 30 August 2024

IPD Group Annual Report 2024

41

Auditor’s Independence Declaration

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PKF(NS) Audit & Assurance Limited Partnership
ABN 91 850 861 839
755 Hunter Street, Newcastle West NSW 2302
Level 8, 1 O’Connell Street, Sydney NSW 2000

Newcastle T: +61 2 4962 2688 F: +61 2 4962 3245 Sydney T: +61 2 8346 6000 F: +61 2 8346 6099 info@pkf.com.au www.pkf.com.au

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PKF(NS) Audit & Assurance Limited Partnership is a member of PKF Global, the network of member firms of PKF
International Limited, each of which is a separately owned legal entity and does not accept any responsibility or
liability for the actions or inactions of any individual member or correspondent firm(s). Liability limited by a
scheme approved under Professional Standards Legislation.

42

IPD Group Annual Report 2024

Independent Auditor’s Report

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PKF(NS) Audit & Assurance Limited Partnership
ABN 91 850 861 839
755 Hunter Street, Newcastle West NSW 2302
Level 8, 1 O’Connell Street, Sydney NSW 2000

Newcastle T: +61 2 4962 2688 F: +61 2 4962 3245 Sydney T: +61 2 8346 6000 F: +61 2 8346 6099 info@pkf.com.au www.pkf.com.au

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PKF(NS) Audit & Assurance Limited Partnership is a member of PKF Global, the network of member firms of PKF
International Limited, each of which is a separately owned legal entity and does not accept any responsibility or
liability for the actions or inactions of any individual member or correspondent firm(s). Liability limited by a
scheme approved under Professional Standards Legislation.

43

IPD Group Annual Report 2024

Independent Auditor’s Report continued

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44 IPD Group Annual Report 2024

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IPD Group Annual Report 2024

45

Independent Auditor’s Report continued

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46

IPD Group Annual Report 2024

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IPD Group Annual Report 2024

47

Independent Auditor’s Report continued

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48

IPD Group Annual Report 2024

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49

IPD Group Annual Report 2024

Directors’ Declaration

In the directors’ opinion:

• a. the attached financial statements and notes comply with the Corporations Act 2001, Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements;

• b. the attached financial statements and notes comply with International Financial Reporting Standards as issued by the International Accounting Standards Board as described in note 1 to the financial statements;

• c. the attached financial statements and notes give a true and fair view of the Group’s financial position as at 30 June 2024 and of its performance for the financial year ended on that date;

• d. The information disclosed in the attached consolidated entity disclosure statement is true and correct; and

• e. there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act 2001.

On behalf of the Directors

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David Rafter Michael Sainsbury Director Director Sydney, 30 August 2024 Sydney, 30 August 2024

50 IPD Group Annual Report 2024

Consolidated Financial Statements

Contents

Contents
Consolidated Statement of Profit or Loss	52
Consolidated Statement of Profit or Loss	53
and Other Comprehensive Income
Consolidated Statement of Financial Position	54
Consolidated Statement of Changes in Equity	55
Consolidated Statement of Cash Flows	56
Notes to the Financial Statements	57

IPD Group Annual Report 2024

51

Consolidated Statement of Profit or Loss

for the year ended 30 June 2024

		Year ended	Year ended
		30 June 2024	30 June 2023
	Note	$’000	$’000
Revenue from continuing operations	5	290,423	226,902
Materials and consumables used		(182,649)	(140,119)
Other income	5	926	554
Employee benefts expense		(50,040)	(44,880)
Freight and delivery expenses		(6,118)	(5,395)
Depreciation and amortisation expenses	6	(5,818)	(4,368)
Occupancy costs		(2,094)	(1,026)
Finance costs	6	(1,527)	(678)
Other expenses		(9,540)	(7,790)
Acquisition costs		(1,221)	–
Profit before income tax		32,342	23,200
Income tax expense	7	(9,978)	(7,123)
Profit after income tax expense for the year		22,364	16,077
Earnings per share
Basic earnings per share (cents per share)	23	23.3	18.6
Diluted earnings per share (cents per share)	23	23.1	18.5

The consolidated statement of profit or loss should be read in conjunction with the Notes to the financial statements.

52 IPD Group Annual Report 2024

Consolidated Statement of Profit or Loss and Other Comprehensive Income

for the year ended 30 June 2024

		Year ended	Year ended
		30 June 2024	30 June 2023
	Note	$’000	$’000
Profit after income tax for the year		22,364	16,077
Other comprehensive income
Items that may be reclassifed subsequently to proft or loss
Exchange differences in translation of foreign operations		(43)	116
Items that will not be reclassifed subsequently to proft or loss
Actuarial revaluation gain		27	36
Total comprehensive income for the year attributable to the owners of IPD Group Ltd		22,348	16,229

The consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the Notes to the financial statements.

IPD Group Annual Report 2024 53

Consolidated Statement of Financial Position

as at 30 June 2024

	30 June 2024	30 June 2023
	Note $’000	$’000
Current assets
Cash and cash equivalents	8 22,284	20,757
Trade and other receivables	9 70,712	44,966
Inventories	10 78,918	42,327
Other assets	1,422	1,030
Total current assets	173,336	109,080
Non-current assets
Property, plant and equipment	11 4,445	3,973
Right of use assets	12 12,078	12,299
Intangible assets	13 78,404	10,459
Deferred tax assets	14 4,510	3,796
Total non-current assets	99,437	30,527
Total assets	272,773	139,607
Current liabilities
Trade and other payables	15 67,840	40,830
Current tax liabilities	17 2,176	2,710
Lease liability	12 3,992	3,011
Provisions	18 6,359	8,166
Total current liabilities	80,367	54,717
Non-current liabilities
Lease liability	12 9,612	10,804
Provisions	18 614	470
Borrowings	16 31,100	–
Deferred tax liabilities	19 339	701
Total non-current liabilities	41,665	11,975
Total liabilities	122,032	66,692
Net assets	150,741	72,915
Equity
Issued capital	20 95,639	31,580
Reserves	21 575	374
Retained earnings	54,527	40,961
Total equity	150,741	72,915

The consolidated statement of financial position should be read in conjunction with the Notes to the financial statements.

IPD Group Annual Report 2024

54

Consolidated Statement of Changes in Equity

for the year ended 30 June 2024

	Issued	Retained
	capital	Earnings	Reserves	Total
	$’000	$’000	$’000	$’000
Balance at 1 July 2022	31,488	32,013	(69)	63,432
Proft for the year	–	16,077	–	16,077
Other comprehensive income for the year (net of tax)	–	36	116	152
Total comprehensive income	–	16,113	116	16,229
Dividends paid (note 22)	–	(7,165)	–	(7,165)
Share issue (note 20)	92	–	327	419
Balance at 30 June 2023	31,580	40,961	374	72,915
Balance at 1 July 2023	31,580	40,961	374	72,915
Proft for the year	–	22,364	–	22,364
Other comprehensive income for the year (net of tax)	–	27	(43)	(16)
Total comprehensive income	–	63,442	332	95,264
Dividends paid (note 22)	–	(8,825)	–	(8,825)
Share issue (note 20)	64,059	–	243	64,302
Balance at 30 June 2024	95,639	54,527	575	150,741

The consolidated statement of changes in equity should be read in conjunction with the Notes to the financial statements.

IPD Group Annual Report 2024 55

Consolidated Statement of Cash Flows

for the year ended 30 June 2024

	Year ended	Year ended
	30 June 2024	30 June 2023
	Note $’000	$’000
Cash fows from operating activities
Receipts from customers	313,305	242,472
Payments to suppliers and employees	(277,830)	(228,194)
Finance costs paid	(334)	(368)
Income taxes paid	(11,776)	(6,490)
Net cash generated by operating activities	27 23,365	7,420
Cash flows from investing activities
Proceeds from the sale of property, plant and equipment	268	57
Payment for property, plant and equipment	(1,701)	(2,157)
R&D expenditure	(89)	–
Acquisition of Subsidiary, net of cash acquired	(99,817)	–
Acquisition advisory costs	(3,516)	–
Net cash used in investing activities	(104,855)	(2,100)
Cash flows from financing activities
Repayment of lease liabilities	(4,270)	(2,862)
Dividends paid	(8,825)	(7,165)
Proceeds from the issue of shares	65,008	–
Borrowings	31,100	–
Net cash generated from/(used in) financing activities	83,013	(10,027)
Net increase/(decrease) in cash and cash equivalents	1,523	(4,707)
Cash and cash equivalents at the beginning of the fnancial year	20,757	25,401
Effects of exchange rate changes on cash	4	63
Cash and cash equivalents at the end of the financial year	22,284	20,757

The consolidated statement of cash flows should be read in conjunction with the Notes to the financial statements.

56 IPD Group Annual Report 2024

Notes to the Financial Statements

1. Basis of Preparation

These general-purpose financial statements for the year ended 30 June 2024 have been prepared in accordance with Australian Accounting Standards (AASBs) adopted by the Australian Accounting Standards Board (AASB) and the Corporations Act 2001. The financial report complies with International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board.

The consolidated financial statements have been prepared on the basis of historical cost, except for the revaluation of certain financial instruments to fair value. Cost is based on the fair values of the consideration given in exchange for assets. The principal accounting policies adopted are consistent with those of the previous financial year, unless otherwise stated.

The accounting policies that are material to the consolidated entity are set out below.

2. Material Accounting Policy Information

a. Basis for consolidation

The consolidated financial statements include the financial position and performance of controlled entities from the date on which control is obtained until the date that control is lost. IPD Group Ltd and its subsidiaries together are referred to in these financial statements as the ‘consolidated entity’.

Intragroup assets, liabilities, equity, income, expenses and cashflows relating to transactions between entities in the consolidated entity have been eliminated in full for the purpose of these financial statements. Intercompany transactions, balances and unrealised gains on transactions between entities in the consolidated entity are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the consolidated entity.

Appropriate adjustments have been made to a controlled entity’s financial position, performance and cash flows where the accounting policies used by that entity were different from those adopted by the consolidated entity. All controlled entities have a June financial year end.

Parent entity information

In accordance with the Corporations Act 2001, these financial statements present the results of the consolidated entity only. Supplementary information about the parent entity is disclosed in note 32.

Subsidiaries

Subsidiaries are all entities (including structured entities) over which the parent has control. Control is established when the parent 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 to direct the relevant activities of the entity.

The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in ownership interest, without the loss of control, is accounted for as an equity transaction, where the difference between the consideration transferred and the book value of the share of the non-controlling interest acquired is recognised directly in equity attributable to the parent.

Subsidiaries are fully consolidated from the date on which control is transferred to the consolidated entity. They are de-consolidated from the date that control ceases.

b. Business combinations

Business combinations are accounted for by applying the acquisition method which requires an acquiring entity to be identified in all cases. The acquisition date under this method is the date that the acquiring entity obtains control over the acquired entity.

The fair value of identifiable assets and liabilities acquired are recognised in the consolidated financial statements at the acquisition date.

IPD Group Annual Report 2024

57

Notes to the Financial Statements continued

2. Material Accounting Policy Information continued

Goodwill or a gain on bargain purchase may arise on the acquisition date, this is calculated by comparing the consideration transferred and the amount of non controlling interest in the acquiree with the fair value of the net identifiable assets acquired. Where consideration is greater than the net assets acquired, the excess is recorded as goodwill. Where the net assets acquired are greater than the consideration, the measurement basis of the net assets are reassessed and then a gain from bargain purchase recognised in profit or loss.

All acquisition related costs are recognised as expenses in the periods in which the costs are incurred except for costs to issue debt or equity securities.

Any contingent consideration which forms part of the combination is recognised at fair value at the acquisition date. If the contingent consideration is classified as equity then it is not remeasured and the settlement is accounted for within equity. Otherwise subsequent changes in the value of the contingent consideration liability are measured through profit or loss.

c. Revenue and other income

Revenue from contracts with customers

The core principle of AASB 15 is that revenue is recognised on a basis that reflects the transfer of promised goods or services to customers at an amount that reflects the consideration the Group expects to receive in exchange for those goods or services. Revenue is recognised by applying a five step model as follows:

1. Identify the contract with the customer

2. Identify the performance obligations

3. Determine the transaction price

4. Allocate the transaction price to the performance obligations

5. Recognise revenue as and when control of the performance obligations is transferred

Generally the timing of the payment for sale of goods and rendering of services corresponds closely to the timing of satisfaction of the performance obligations, however where there is a difference, it will result in the recognition of a receivable, contract asset or contract liability.

None of the revenue streams of the Group have any significant financing terms as there is less than 12 months between receipt of funds and satisfaction of performance obligations.

Specific revenue streams

The revenue recognition policies for the principal revenue streams of the Group are:

Sale of goods

Sale goods consists of industrial electrical products, including engineered solutions, direct to the “end user” customer and to the electrical wholesale markets. Revenue is recognised when the performance obligations have been satisfied, which is upon delivery of the goods.

Rendering of services

Rendering of services relates to the testing, calibration and repair of electrical testing and measurement equipment.

Revenue is recognised when the control of the promised goods and services is passed to the customer, typically upon performance or delivery of such goods and services. Accordingly, for the revenue streams described above, revenue is recognised at the point in time as the goods are delivered and services are performed.

Revenue is measured based on the consideration to which the Group expects to be entitled in a contract with a customer and excludes amounts collected on behalf of third parties.

Other income

Other income is recognised on an accruals basis when the Group is entitled to it.

58 IPD Group Annual Report 2024

d. Operating segments

Operating segments are presented using the ‘management approach’, where the information presented is on the same basis as the internal reports provided to the Chief Operating Decision Makers (‘CODM’). The CODM is responsible for the allocation of resources to operating segments and assessing their performance.

e. Taxation

The tax expense recognised in the statement of profit or loss and other comprehensive income comprises current income tax expense plus deferred tax expense.

Current tax is the amount of income taxes payable (recoverable) in respect of the taxable profit (loss) for the year and is measured at the amount expected to be paid to (recovered from) the taxation authorities, using the tax rates and laws that have been enacted or substantively enacted by the end of the reporting period. Current tax liabilities (assets) are measured at the amounts expected to be paid to (recovered from) the relevant taxation authority.

Deferred tax is provided on temporary differences which are determined by comparing the carrying amounts of tax bases of assets and liabilities to the carrying amounts in the consolidated financial statements.

Deferred tax is not provided for the following:

• The initial recognition of an asset or liability in a transaction that is not a business combination and at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss).

• Taxable temporary differences arising on the initial recognition of goodwill.

• Temporary differences related to investment in subsidiaries, associates and jointly controlled entities to the extent that the Group is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and losses can be utilised.

Current and deferred tax is recognised as income or an expense and included in profit or loss for the period except where the tax arises from a transaction which is recognised in other comprehensive income or equity, in which case the tax is recognised in other comprehensive income or equity respectively.

Tax consolidation

IPD Group Limited (the Group) and its 100% owned Australian subsidiaries are part of a tax consolidated group. As a result, members of the group have entered into a tax sharing arrangement in order to allocate income tax expense to the wholly-owned subsidiaries on a pro-rata basis. In addition, the agreement provides for the allocation of income tax liabilities between the entities should the head entity default on its tax obligations. At the balance date, the possibility of default is remote. The head entity of the tax consolidation is the Group.

The Group has recognised the current tax liability of the tax consolidated group.

Members of the tax consolidated group are part of a tax funding agreement. The tax funding agreement provides for the allocation of current and deferred taxes to members of the tax consolidated group in accordance with their taxable income for the year. The allocation of taxes under the tax funding agreement is recognised as an increase/decrease in the subsidiaries’ intercompany accounts with the head entity. The Group has applied the group allocation approach to determine the appropriate amount of current and deferred tax to allocate to each member of the tax consolidated group.

f. Borrowing costs

Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised as part of the cost of that asset. All other borrowing costs are recognised as an expense in the period in which they are incurred.

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IPD Group Annual Report 2024

Notes to the Financial Statements continued

2. Material Accounting Policy Information continued

g. Inventories

Inventories are measured at the lower of cost and net realisable value. Cost of inventory is determined using the weighted average costs basis and is net of any rebates and discounts received. Net realisable value is estimated using the most reliable evidence available at the reporting date and inventory is written down through an obsolescence provision if necessary.

h. Property, plant and equipment

Each class of property, plant and equipment is carried at cost or fair value less, where applicable, any accumulated depreciation and impairment.

Land and buildings

Land and buildings are measured using the cost model.

Plant and equipment

Plant and equipment are measured using the cost model.

Depreciation

Property, plant and equipment, excluding freehold land, is depreciated on a straight line basis over the assets useful life to the Group, commencing when the asset is ready for use.

Leased assets and leasehold improvements are amortised over the shorter of either the unexpired period of the lease or their estimated useful life.

The estimated useful lives used for each class of depreciable asset are shown below:

Fixed asset class	Useful life
Plant and Equipment	3 – 10 years
Furniture, Fixtures and Fittings	4 – 0 years
Motor Vehicles	4 – 5 years
Leasehold improvements	Over the period of the lease

At the end of each annual reporting period, the depreciation method, useful life and residual value of each asset is reviewed. Any revisions are accounted for prospectively as a change in estimate.

i. Right of use assets

The right of use asset is measured using the cost model where cost on initial recognition comprises of the lease liability, initial direct costs, prepaid lease payments, estimated cost of removal and restoration less any lease incentives received. The right of use asset is depreciated over the lease term on a straight line basis and assessed for impairment in accordance with the impairment of assets accounting policy.

j. Financial Instruments

Financial instruments are recognised initially on the date that the Group becomes party to the contractual provisions of the instrument.

On initial recognition, all financial instruments are measured at fair value plus transaction costs (except for instruments measured at fair value through profit or loss where transaction costs are expensed as incurred).

Financial assets

All recognised financial assets are subsequently measured in their entirety at either amortised cost or fair value, depending on the classification of the financial assets.

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IPD Group Annual Report 2024

Classification

On initial recognition the Group classifies its financial assets at amortised cost.

Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its business model for managing financial assets.

Amortised cost

Assets measured at amortised cost are financial assets where:

• the business model is to hold assets to collect contractual cash flows; and

• the contractual terms give rise on specified dates to cash flows are solely payments of principal and interest on the principal amount outstanding.

The Group’s financial assets measured at amortised cost comprise trade and other receivables and cash and cash equivalents in the statement of financial position.

Subsequent to initial recognition, these assets are carried at amortised cost using the effective interest rate method less provision for impairment.

Interest income, foreign exchange gains or losses and impairment are recognised in profit or loss. Gain or loss on derecognition is recognised in profit or loss.

Impairment of financial assets

Impairment of financial assets is recognised on an expected credit loss (ECL) basis for the following assets:

• financial assets measured at amortised cost

When determining whether the credit risk of a financial assets has increased significant since initial recognition and when estimating ECL, the Group considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis based on the Group’s historical experience and informed credit assessment and including forward looking information.

The Group uses the presumption that an asset which is more than 30 days past due has seen a significant increase in credit risk.

The Group uses the presumption that a financial asset is in default when:

• the other party is unlikely to pay its credit obligations to the Group in full, without recourse to the Group to actions such as realising security (if any is held); or

• the financial assets is more than 90 days past due.

Credit losses are measured as the present value of the difference between the cash flows due to the Group in accordance with the contract and the cash flows expected to be received. This is applied using a probability weighted approach.

Trade receivables and contract assets

Impairment of trade receivables and contract assets have been determined using the simplified approach in AASB 9 which uses an estimation of lifetime expected credit losses. The Group has determined the probability of non payment of the receivable and contract asset and multiplied this by the amount of the expected loss arising from default.

The amount of the impairment is recorded in a separate allowance account with the loss being recognised in finance expense. Once the receivable is determined to be uncollectable then the gross carrying amount is written off against the associated allowance.

Where the Group renegotiates the terms of trade receivables due from certain customers, the new expected cash flows are discounted at the original effective interest rate and any resulting difference to the carrying value is recognised in profit or loss.

Other financial assets measured at amortised cost

Impairment of other financial assets measured at amortised cost are determined using the expected credit loss model in AASB 9. On initial recognition of the asset, an estimate of the expected credit losses for the next 12 months is recognised. Where the asset has experienced significant increase in credit risk then the lifetime losses are estimated and recognised.

IPD Group Annual Report 2024

61

Notes to the Financial Statements continued

2. Material Accounting Policy Information continued

Financial liabilities

The Group measures all financial liabilities initially at fair value less transaction costs, subsequently financial liabilities are measured at amortised cost using the effective interest rate method.

The financial liabilities of the Group comprise trade payables, bank and other loans and lease liabilities.

k. Impairment of non financial assets

At the end of each reporting period the Group determines whether there is an evidence of an impairment indicator for non financial assets.

Where an indicator exists and regardless for goodwill, indefinite life intangible assets and intangible assets not yet available for use, the recoverable amount of the asset is estimated.

Where assets do not operate independently of other assets, the recoverable amount of the relevant cash generating unit (CGU) is estimated.

The recoverable amount of an asset or CGU is the higher of the fair value less costs of disposal and the value in use. Value in use is the present value of the future cash flows expected to be derived from an asset or cash generating unit.

Where the recoverable amount is less than the carrying amount, an impairment loss is recognised in profit or loss.

Reversal indicators are considered in subsequent periods for all assets which have suffered an impairment loss, except for goodwill.

l. Intangible assets

Goodwill

Goodwill is carried at cost less accumulated impairment losses. Goodwill is calculated as the excess of the sum of:

i. the consideration transferred;

ii. any non controlling interest; and

iii. the acquisition date fair value of any previously held equity interest;

over the acquisition date fair value of net identifiable assets acquired in a business combination.

Under the ‘full goodwill method’, the fair values of the non controlling interests are determined using valuation techniques which make the maximum use of market information where available.

Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill on acquisition of associates is included in investments in associates.

Goodwill is not amortised but is tested for impairment annually and is allocated to the Group’s cash generating units or groups of cash generating units, which represent the lowest level at which goodwill is monitored but where such level is not larger than an operating segment. Gains and losses on the disposal of an entity include the carrying amount of goodwill related to the entity sold.

Changes in the ownership interests in a subsidiary are accounted for as equity transactions and do not affect the carrying values of goodwill.

m. Cash and cash equivalents

Cash and cash equivalents comprises cash on hand, demand deposits and short term investments which are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value.

Bank overdrafts also form part of cash equivalents for the purpose of the statement of cash flows and are presented within current liabilities on the statement of financial position.

62 IPD Group Annual Report 2024

n. Trade and other receivables

Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 30 days.

The Group has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue.

Other receivables are recognised at amortised cost, less any allowance for expected credit losses.

o. Trade and other payables

These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year and which are unpaid. Due to their short term nature they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of recognition.

p. Leases

At inception of a contract, the Group assesses whether a lease exists i.e. does the contract convey the right to control the use of an identified asset for a period of time in exchange for consideration.

This involves an assessment of whether:

• The contract involves the use of an identified asset this may be explicitly or implicitly identified within the agreement. If the

• supplier has a substantive substitution right then there is no identified asset.

• The Group has the right to obtain substantially all of the economic benefits from the use of the asset throughout the period of use.

• The Group has the right to direct the use of the asset i.e. decision making rights in relation to changing how and for what purpose the asset is used.

Lessee accounting

The non lease components included in the lease agreement have been separated and are recognised as an expense as incurred.

At the lease commencement, the Group recognises a right of use asset and associated lease liability for the lease term. The lease term includes extension periods where the Group believes it is reasonably certain that the option will be exercised.

The right of use asset is measured using the cost model where cost on initial recognition comprises of the lease liability, initial direct costs, prepaid lease payments, estimated cost of removal and restoration less any lease incentives received.

The right of use asset is depreciated over the lease term on a straight line basis and assessed for impairment in accordance with the impairment of assets accounting policy.

The lease liability is initially measured at the present value of the remaining lease payments at the commencement of the lease. The discount rate is the rate implicit in the lease, however where this cannot be readily determined then the Group’s incremental borrowing rate is used.

Subsequent to initial recognition, the lease liability is measured at amortised cost using the effective interest rate method. The lease liability is remeasured whether there is a lease modification, change in estimate of the lease term or index upon which the lease payments are based (e.g. CPI) or a change in the Group’s assessment of lease term.

Where the lease liability is remeasured, the right of use asset is adjusted to reflect the remeasurement or is recorded in profit or loss if the carrying amount of the right of use asset has been reduced to zero.

Exceptions to lease accounting

The Group has elected to apply the exceptions to lease accounting for both short term leases (i.e. leases with a term of less than or equal to 12 months) and leases of low value assets. The Group recognises the payments associated with these leases as an expense on a straight line basis over the lease term.

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IPD Group Annual Report 2024

Notes to the Financial Statements continued

2. Material Accounting Policy Information continued

q. Employee benefits

Provision is made for the Group’s liability for employee benefits arising from services rendered by employees to the end of the reporting period. Employee benefits that are expected to be wholly settled within one year have been measured at the amounts expected to be paid when the liability is settled.

Employee benefits expected to be settled more than one year after the end of the reporting period have been measured at the present value of the estimated future cash outflows to be made for those benefits. In determining the liability, consideration is given to employee wage increases and the probability that the employee may satisfy vesting requirements. Cashflows are discounted using market yields on high quality corporate bond rates incorporating bonds rated AAA or AA by credit agencies, with terms to maturity that match the expected timing of cashflows. Changes in the measurement of the liability are recognised in profit or loss.

r. Warranty provisions

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

Provisions are measured at the present value of management’s best estimate of the outflow required to settle the obligation at the end of the reporting period. The discount rate used is a pre tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the unwinding of the discount is taken to finance costs in the statement of profit or loss and other comprehensive income.

s. Issued capital

Ordinary shares are classified as equity.

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

t. Dividends

Dividends are recognised when declared during the financial year and no longer at the discretion of the Group.

u. Earnings per share

Basic earnings per share is calculated by dividing the profit attributable to the owners of the Group, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the financial year.

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.

v. Share based payments

The Company has established the EIP to assist in the motivation, reward and retention of senior management and other IPD employees from time to time. The EIP is designed to align the interests of senior management and other employees with the interests of Shareholders by providing an opportunity for employees to receive equity interests in the Company subject to the satisfaction of certain performance conditions. IPD may offer additional incentive schemes to the management and employees over time.

Equity-settled and cash-settled share-based compensation benefits are provided to employees.

Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of cash is determined by reference to the share price.

64 IPD Group Annual Report 2024

The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined using either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine whether the consolidated entity receives the services that entitle the employees to receive payment. No account is taken of any other vesting conditions.

The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous periods.

The cost of cash-settled transactions is initially, and at each reporting date until vested, determined by applying either the Binomial or Black-Scholes option pricing model, taking into consideration the terms and conditions on which the award was granted. The cumulative charge to profit or loss until settlement of the liability is calculated as follows:

• during the vesting period, the liability at each reporting date is the fair value of the award at that date multiplied by the expired portion of the vesting period.

• from the end of the vesting period until settlement of the award, the liability is the full fair value of the liability at the reporting date.

All changes in the liability are recognised in profit or loss. The ultimate cost of cash-settled transactions is the cash paid to settle the liability.

Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are satisfied.

If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of the share-based compensation benefit as at the date of modification.

If the non-vesting condition is within the control of the consolidated entity or employee, the failure to satisfy the condition is treated as a cancellation. If the condition is not within the control of the consolidated entity or employee and is not satisfied during the vesting period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.

If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award is treated as if they were a modification.

w. Fair value measurement

When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes, the fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; and assumes that the transaction will take place either: in the principal market; or in the absence of a principal market, in the most advantageous market.

Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming they act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, are used, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

IPD Group Annual Report 2024

65

Notes to the Financial Statements continued

2. Material Accounting Policy Information continued

Assets and liabilities measured at fair value are classified into three levels, using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. Classifications are reviewed at each reporting date and transfers between levels are determined based on a reassessment of the lowest level of input that is significant to the fair value measurement.

For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either not available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge and reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an analysis is undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison, where applicable, with external sources of data.

x. Foreign currency transactions and balances

Transaction and balances

Foreign currency transactions are recorded at the spot rate on the date of the transaction.

At the end of the reporting period:

• Foreign currency monetary items are translated using the closing rate;

• Non monetary items that are measured at historical cost are translated using the exchange rate at the date of the transaction; and

• Non monetary items that are measured at fair value are translated using the rate at the date when fair value was determined.

Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition or in prior reporting periods are recognised through profit or loss, except where they relate to an item of other comprehensive income or whether they are deferred in equity as qualifying hedges.

Foreign operations

Foreign subsidiary transactions and balances are translated at the closing rate at the end of each reporting period. Exchange differences arising on translating monetary items at rates different from those at which they were translated on initial recognition or in prior reporting periods are recognised in equity.

y. Research & Development

Research costs are expensed in the period in which they are incurred. Development costs are capitalised when it is probable that the project will be a success considering its commercial and technical feasibility; the consolidated entity is able to use or sell the asset; the consolidated entity has sufficient resources and intent to complete the development; and its costs can be measured reliably. Capitalised development costs are amortised on a straight-line basis over the period of their expected benefit, being their finite life of 5 years.

z. Adoption of new and revised accounting standards

There were no new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board that are material to the Group for the year ended 30 June 2024.

aa. Rounding of amounts

The Company is a company of the kind referred to in the Class order 2016/191 - ASIC Corporations (Rounding in Financial/ Directors’ Reports) Instrument 2016/191 , dated 24 March 2016, and in accordance with that Class Order amounts in the Directors’ report and the consolidated financial statements are rounded off to the nearest thousand dollars, unless otherwise indicated.

66 IPD Group Annual Report 2024

3. Critical Accounting Estimates and Judgements

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below.

Share-based payment transactions

The consolidated entity measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using either the Binomial or Black-Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact profit or loss and equity. Refer to note 29 for further information.

Revenue from contracts with customers involving sale of goods

When recognising revenue in relation to the sale of goods to customers, the key performance obligation of the consolidated entity is considered to be the point of delivery of the goods to the customer, as this is deemed to be the time that the customer obtains control of the promised goods and therefore the benefits of unimpeded access.

Net realisable value of inventories

The provision for impairment of inventories assessment requires a degree of estimation and judgement. The realisable value is assessed by taking into account the recent sales experience, the ageing of inventories and other factors that affect the recoverable amount of inventory.

Estimation of useful lives of assets

The consolidated entity determines the estimated useful lives and related depreciation and amortisation charges for its property, plant and equipment and finite life intangible assets. The useful lives could change significantly as a result of technical innovations or some other event. The depreciation and amortisation charge will increase where the useful lives are less than previously estimated lives, or technically obsolete or non-strategic assets that have been abandoned or sold will be written off or written down.

Goodwill and other indefinite life intangible assets

The consolidated entity tests annually, or more frequently if events or changes in circumstances indicate impairment, whether goodwill and other indefinite life intangible assets have suffered any impairment, in accordance with the accounting policy stated in note 2. The recoverable amounts of cash-generating units have been determined based on value-in-use calculations. These calculations require the use of assumptions, including estimated discount rates based on the current cost of capital and growth rates of the estimated future cash flows.

IPD Group Annual Report 2024

67

Notes to the Financial Statements continued

3. Critical Accounting Estimates and Judgements continued

Lease term

The lease term is a significant component in the measurement of both the right-of-use asset and lease liability. Judgement is exercised in determining whether there is reasonable certainty that an option to extend the lease or purchase the underlying asset will be exercised, or an option to terminate the lease will not be exercised, when ascertaining the periods to be included in the lease term. In determining the lease term, all facts and circumstances that create an economical incentive to exercise an extension option, or not to exercise a termination option, are considered at the lease commencement date. Factors considered may include the importance of the asset to the consolidated entity’s operations; comparison of terms and conditions to prevailing market rates; incurrence of significant penalties; existence of significant leasehold improvements; and the costs and disruption to replace the asset. The consolidated entity reassesses whether it is reasonably certain to exercise an extension option, or not exercise a termination option, if there is a significant event or significant change in circumstances.

Incremental borrowing rate

Where the interest rate implicit in a lease cannot be readily determined, an incremental borrowing rate is estimated to discount future lease payments to measure the present value of the lease liability at the lease commencement date. Such a rate is based on what the consolidated entity estimates it would have to pay a third party to borrow the funds necessary to obtain an asset of a similar value to the right-of-use asset, with similar terms, security and economic environment.

Employee benefits provision

As discussed in note 2, the liability for employee benefits expected to be settled more than 12 months from the reporting date are recognised and measured at the present value of the estimated future cash flows to be made in respect of all employees at the reporting date. In determining the present value of the liability, estimates of attrition rates and pay increases through promotion and inflation have been taken into account.

Business combinations

As discussed in note 2, business combinations are initially accounted for on a provisional basis. The fair value of assets acquired, liabilities and contingent liabilities assumed are initially estimated by the consolidated entity taking into consideration all available information at the reporting date. Fair value adjustments on the finalisation of the business combination accounting is retrospective, where applicable, to the period the combination occurred and may have an impact on the assets and liabilities, depreciation and amortisation reported.

4. Segment Information

Operating segments are reported in a manner which is consistent with the internal reporting provided to the CODM as defined above. The CODM have been identified as the Board of Directors for the Group.

The internal reports reviewed by the Board, which are used to make strategic decisions, are separated into the Group’s key market segments Products division and Services Division:

Operating segments have been defined as:

• Products division – core focus in the products division is the sale of electrical infrastructure products to customers including switchboard manufacturers, electrical wholesalers, electrical contractors, power utilities, OEMs and system integrators

• Services Division – provision of services, including installation and commissioning, calibration and testing, maintenance and repairs and refurbishment

68 IPD Group Annual Report 2024

The accounting policies of the reportable secondary segments are the same as Group’s accounting policies.

	Products	Services
	division	division	Total
Year ended 30 June 2024	$’000	$’000	$’000
Revenue from external customers Other revenue/income	270,682 165	19,741 28	290,423 193
Total revenue from ordinary activities	270,847	19,769	290,616
Earnings before Interest, Tax, Depreciation and Amortisation	37,957	933	38,890
Depreciation and amortisation expense Interest expense			(5,818) (730)
Profit before income tax			32,342
Income Tax			(9,978)
Net profit after income tax			22,364

	Products	Services
	division	division	Total
Year ended 30 June 2023	$’000	$’000	$’000
Revenue from external customers	208,063	18,839	226,902
Other revenue/income	243	1	244
Total revenue from ordinary activities	208,306	18,840	227,146
Earnings before Interest, Tax, Depreciation and Amortisation	26,436	1,303	27,739
Depreciation and amortisation expense			(4,368)
Interest expense			(171)
Profit before income tax			23,200
Income Tax			(7,123)
Net profit after income tax			16,077

The Group’s assets were not split by reportable secondary operating segment as the CODM do not utilise this information for the purposes of resource allocation and assessment of segment performance.

IPD Group Annual Report 2024 69

Notes to the Financial Statements continued

5. Revenue and Other Income

5. Revenue and Other Income
	2024	2023
	$’000	$’000
Revenue from external customers	290,423	226,902
Other Income
Recoveries	49	193
Proft from sale of fxed assets	120	48
Interest income	733	310
Other Income	24	3
Total other income	926	554
Total Revenue and Other Income	291,349	227,456

6. Expenses

6. Expenses
	2024	2023
	$’000	$’000
Depreciation
Plant and Equipment	1,831	1,430
Buildings ROU	3,821	2,888
Plant and Equipment ROU	2	50
Amortisation
Intangibles	164	–
Total depreciation and amortisation	5,818	4,368
Finance costs
Bank charges	64	198
Interest expense on lease liabilities	1,463	480
Total finance costs	1,527	678

70 IPD Group Annual Report 2024

7. Income Tax Expense

7. Income Tax Expense
	2024	2023
	$’000	$’000
Income tax expense
Current Tax Expense
Local income tax -current period	10,097	7,552
Adjustments recognised for prior periods	(25)	(89)
Deferred Tax Expense
Origination and reversal of temporary differences	(94)	(340)
Total income tax expense	9,978	7,123
Numerical reconciliation of income tax expense and tax at the statutory rate
Proft before income tax expense	32,342	23,200
Tax at the statutory tax rate of 30% (2023: 30%)	9,703	6,960
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Entertainment expenses	120	122
Management share rights	180	126
Other non-allowable items	–	4
Over provision for income tax in prior year	(25)	(89)
Income tax expense	9,978	7,123

8. Cash and Cash Equivalents

8. Cash and Cash Equivalents
	2024	2023
	$’000	$’000
Cash at bank	22,284	25,757
Cash and cash equivalents	22,284	20,757
Cash and Cash equivalents reported in the statement of cash fows are reconciled to the equivalent items in the statement of fnancial position as follows:
Cash and cash equivalents	22,284	20,757
Balance as per statement of cash flows	22,284	20,757

IPD Group Annual Report 2024

71

Notes to the Financial Statements continued

9. Trade and Other Receivables

9. Trade and Other Receivables
2024	2023
$’000	$’000
Trade receivables 71,462	45,535
Provision for impairment (750)	(569)
Trade and other receivables 70,712	44,966

The carrying value of trade receivables is considered a reasonable approximation of fair value due to the short-term nature of the balances.

The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable in the financial statements.

Impairment of receivables

Impairment of receivables
2024	2023
$’000	$’000
Balance at beginning of the year 569	524
(Write off)/additional impairment loss recognised 181	45
Balance at end of year 750	569

The Group measures the loss allowance for trade receivables at an amount equal to lifetime expected credit loss (ECL). The ECL on trade receivables are estimated using a provision matrix by reference to past default experience of the debtor and an analysis of the debtor’s current financial position, adjusted for factors that are specific to the debtors, general economic conditions of the industry in which the debtors operate and an assessment of both the current as well as the forecast direction of conditions at the reporting date.

	Trade		Provision for
	receivables	Credit loss	impairment
	$’000	allowance	$’000
Current	66,797	0.42%	283
0 – 30 days	4,274	6.11%	261
31 – 60 days	60	43.33%	26
61 – 90 days	109	47.71%	52
90+ days	222	57.66%	128
Total trade receivables	71,462		750

There has been no change in the estimation techniques or significant assumptions made during the current reporting period.

The Group writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery, e.g. when the debtor has been placed under liquidation or has entered into bankruptcy proceedings.

72

IPD Group Annual Report 2024

10. Inventories

10. Inventories
2024	2023
$’000	$’000
Finished goods 78,374	42,065
Work in progress 544	262
Total Inventories 78,918	42,327

Write-downs of inventories to net realisable value during the year were $Nil (2023: $Nil).

11. Property, Plant and Equipment

			Furniture,		Leasehold
	Plant and	Computer	Fixtures	Motor	Improve-
	Equipment	Equipment	and Fittings	Vehicles	ments	Total
	$’000	$’000	$’000	$’000	$’000	$’000
Year ended 30 June 2024
Balance 1 July 2023	382	970	494	1,106	1,021	3,973
Additions	273	612	114	672	132	1,803
Additions through the acquisition of entity	442	–	128	–	29	599
Disposals	(9)	–	(17)	(84)	–	(110)
Foreign exchange on translation	–	11	–	–	–	11
Depreciation expense	(239)	(583)	(135)	(422)	(452)	(1,831)
Balance at 30 June 2024	849	1,010	584	1,272	730	4,445
Year ended 30 June 2024
Cost	4,470	4,506	1,327	3,236	2,193	15,732
Accumulated depreciation	(3,621)	(3,496)	(743)	(1,964)	(1,463)	(11,287)
Balance at 30 June 2024	849	1,010	584	1,272	730	4,445

73

IPD Group Annual Report 2024

Notes to the Financial Statements continued

11. Property, Plant and Equipment continued

			Furniture,		Leasehold
	Plant and	Computer	Fixtures	Motor	Improve-
	Equipment	Equipment	and Fittings	Vehicles	ments	Total
	$’000	$’000	$’000	$’000	$’000	$’000
Year ended 30 June 2023
Balance 1 July 2022	463	721	420	1,060	690	3,354
Additions	108	627	167	496	606	2,004
Disposals	–	(4)	–	(13)	–	(17)
Foreign exchange on translation	–	53	6	1	2	62
Depreciation expense	(189)	(427)	(99)	(438)	(277)	(1,430)
Balance at 30 June 2023	382	970	494	1,106	1,021	3,973
Year ended 30 June 2023
Cost	3,321	3,900	1088	2,957	2,031	13,297
Accumulated depreciation	(2,939)	(2,930)	(594)	(1,851)	(1,010)	(9,324)
Balance at 30 June 2023	382	970	494	1,106	1,021	3,973

12. Leases

Right-of-use assets

	Buildings	Motor Vehicles	Total
	$’000	$’000	$’000
Year ended 30 June 2024
Balance at the beginning of the year	12,297	2	12,299
Additions to right-of-use assets	3,600	–	3,600
Depreciation charge	(3,819)	(2)	(3,821)
Balance at the end of year	12,078	–	12,078
Year ended 30 June 2023
Balance at the beginning of the year	11,074	52	11,126
Additions to right-of-use assets	4,110	–	4,110
Depreciation charge	(2,887)	(50)	(2,937)
Balance at the end of year	12,297	2	12,299

IPD Group Annual Report 2024

74

Lease liabilities

					Lease liabilities
					included in
				Total	this Statement
				undiscounted	of Financial
	< 1 year	1 - 5 years	> 5 years	lease liabilities	Position
	$’000	$’000	$’000	$’000	$’000
June 2024
Lease liabilities	4,326	10,134	241	14,701	13,604
June 2023
Lease liabilities	3,454	10,808	786	14,348	13,815

Right-of-use assets and lease liabilities

The Group has leases for various network sites and motor vehicles. Rental contracts may contain both lease and non-lease components. The Group allocates the consideration in the contract to the lease and non- lease components based on their relative stand-alone prices.

Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor. Leased assets may not be used as security for borrowing purposes.

Payments associated with short-term leases of equipment and vehicles and all leases of low-value assets are recognised on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less. Low-value assets comprise IT equipment.

13. Intangible Assets

13. Intangible Assets
2024	2023
$’000	$’000
Goodwill 76,704	10,459
Development costs 1,700	–
Closing Balance 78,404	10,459

IPD Group Annual Report 2024 75

Notes to the Financial Statements continued

13. Intangible Assets continued

Reconciliation of the written down value at the beginning and end of the current and previous financial year is set out below:

		Development
	Goodwill	costs	Total
	$’000	$’000	$’000
Year ended 30 June 2024
Balance at the beginning of the year	10,459	–	10,459
Additions through business combination (Note 26)	66,245	1,775	68,020
Additions	–	89	89
Amortisation charge	–	(164)	(164)
Balance at the end of year	76,704	1,700	78,404

Goodwill impairment was assessed on the basis that IPD, EX Engineering and CMI Operations are identifiable cash generating business units.

				IPD	EX Engineering	CMI Operations	Total
				$’000	$’000	$’000	$’000
Balance at	30	June	2024	10,459	9,092	57,153	76,704

The recoverable amount of the consolidated entity’s goodwill has been determined by a value-in-use calculation using a discounted cash flow model, based on a 5 year projection period using a steady rate, together with a terminal value.

Key rate assumptions included in the current financial year impairment assessment are set out in the following table:

		EX	CMI
	IPD	Engineering	Operations
	%	%	%
Discount rate – pre-tax	12%	12%	12%
Long-term annual growth rate	4%	4%	4%

Forecast transaction volumes are the key drivers in determining the cashflow projection for each CGU. In the even that transaction volumes do not reach the levels forecast there is a risk that the forecast cashflows are not sufficient to support the carrying value of goodwill and an impairment charge may be reported in a future accounting period.

Sensitivity to change assumptions:

Increases in discount rates or changes in other key assumptions may cause the recoverable amount to fall below carrying values. Based on current economic conditions and CGU performances, there are no reasonably possible changes to key assumptions used in the determination of CGU recoverable amounts that would result in material impairment to the consolidated entity.

76 IPD Group Annual Report 2024

14. Deferred Tax Assets

14. Deferred Tax Assets
	2024	2023
	$’000	$’000
Deferred tax assets
Provisions and accruals	2,364	2,795
Right-of-use assets	464	443
Section 40-880 deduction – Acquisition and legal costs	1,179	496
Subsidiary acquisition costs	503	52
Other	–	10
Total deferred tax assets	4,510	3,796

	2024	2023
	$’000	$’000
The movement of net deferred tax assets during the year is as follows:
Opening balance	3,796	2,891
Amount recognised in proft and loss	(237)	817
Amount recognised in equity	619	–
Adjustments recognised for prior periods	28	88
Additions through business combinations	304	–
Closing balance	4,510	3,796

15. Trade and Other Payables

15. Trade and Other Payables
	2024	2023
	$’000	$’000
Trade payables	51,870	33,287
Other payables	14,749	7,543
Contingent considerationi	1,221	–
Total trade and other payables	67,840	40,830

i. Represents contingent consideration on the acquisition of EX Engineering Pty Ltd. The Earn Out amount of $1,221,000 was calculated as the Actual FY24 EBITDA minus the Actual FY23 EBITDA, times a pre-determined multiplier up to a maximum aggregate Purchase Price of $11,400,000.

IPD Group Annual Report 2024 77

Notes to the Financial Statements continued

16. Borrowings

16. Borrowings
	2024	2023
	$’000	$’000
Working capital facilityi	–	–
Acquisition debt facilityii	31,100	–
Total facility	31,100	–
Current	–	–
Non-current	31,100	–
Total facility	31,100	–

16.1 Facilities

During the financial year, the Group had the following borrowing facilities established:

• i. The Group has a $10,000,000 working capital finance facility available to meet working capital requirements.

• ii. The Group has a $40,000,000 acquisition debt facility available to fund the acquisition of CMI Operations Ltd of which $31,100,000 has been drawn as at 30 June 2024.

17. Current Tax Liabilities

17. Current Tax Liabilities
	2024	2023
	$’000	$’000
Income tax payable	2,176	2,710
Total Income tax payable	2,176	2,710

18. Provisions

18. Provisions
	2024	2023
	$’000	$’000
Current
Warranties	235	142
Provision of employee benefts	6,124	8,024
Total current provisions	6,359	8,166
Non-current
Provision of employee benefts	614	470

78 IPD Group Annual Report 2024

19. Deferred Tax Liabilities

19. Deferred Tax Liabilities
	2024	2023
	$’000	$’000
Deferred tax liabilities
Depreciation	337	681
Unrealised foreign exchange losses	2	20
Total deferred tax liabilities	339	701

	2024	2023
	$’000	$’000
The movement of net deferred tax liabilities during the year is as follows:
Opening balance	701	235
Amount recognised in proft and loss	(331)	466
Additions through business combinations	(31)	–
Closing balance	339	701

20. Issued Capital

20. Issued Capital
		2024	2023
		$	$
103,380,078 fully paid ordinary shares (2023: 86,365,798)		95,638,743	31,579,708
Movement:
			Number of
Date	Details	$	Shares
1 July 2023	Opening balance	31,579,708	86,365,798
	Movement:
25 July 2023	Partial consideration of acquisition	1,012,044	221,272
30 September 2023	FY23 Performance Rights – Shares Issued	355,716	251,593
21 December 2023	New capital raised in the market	62,691,275	16,541,415
30 June 2024	Closing Balance	95,638,743	103,380,078

79

IPD Group Annual Report 2024

Notes to the Financial Statements continued

20. Issued Capital continued

Ordinary shares

Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the company does not have a limited amount of authorised capital.

On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.

Capital risk management

The consolidated entity’s objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost of capital.

Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated as total borrowings less cash and cash equivalents.

In order to maintain or adjust the capital structure, the consolidated entity may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

The consolidated entity would look to raise capital when an opportunity to invest in a business or company was seen as value adding relative to the current company’s share price at the time of the investment. The consolidated entity is not actively pursuing additional investments in the short term as it continues to integrate and grow its existing businesses in order to maximise synergies.

The consolidated entity is subject to certain financing arrangements covenants and meeting these is given priority in all capital risk management decisions. There have been no events of default on the financing arrangements during the financial year.

The capital risk management policy remains unchanged from the 30 June 2023 Annual Report.

21. Reserves

21. Reserves
2024	2023
$’000	$’000
Foreign currency translation reserve (101)	(59)
Share based payments reserve 676	433
Total reserves 575	374

Foreign currency translation reserve

The reserve is used to recognise exchange differences arising from the translation of the financial statements of foreign operations to Australian dollars. It is also used to recognise gains and losses on hedges of the net investments in foreign operations.

Share based payments reserve

The reserve is used to recognise the equity settled transactions with employees based on the fair value of the equity instruments at the date at which they are granted. The fair value is determined using either the Binomial or Back Scholes model taking into account the terms and conditions upon which the instruments were granted.

80 IPD Group Annual Report 2024

22. Dividends

The following dividends were declared and paid:

2024	2023
$’000	$’000
Final ordinary fully franked dividend of 4.7 cents per share (2023: 3.7 cents per share) 4,070	3,192
Interim ordinary fully franked dividend of 4.6 cents per share (2023: 4.6 cents per share) 4,755	3,973
Total dividends declared and paid 8,825	7,165

The cents per share from the dividends paid during the year ended 30 June 2024 have been recalculated to reflect the proportion of shares post share split.

On 30 August 2024, the Directors declared a final dividend of 6.2 cents per share fully franked with an ex-dividend date of 19 September 2024, record date of 20 September 2024 and payable on 04 October 2024.

Franked dividends declared or paid during the year were franked at the tax rate of 30%.

Franking credits account

		2024	2023
		$’000	$’000
The franking credits available for subsequent fnancial years at a tax rate of	30%	24,057	16,006

The above available balance is based on the dividend franking account at year end adjusted for:

• a. Franking credits that will arise from the payment of the current tax liabilities;

• b. Franking debits that will arise from the payment of dividends recognised as a liability at the year end;

• c. Franking credits that will arise from the receipt of dividends recognised as receivables at the end of the year.

The ability to use the franking credits is dependent upon the Company’s future ability to declare dividends.

IPD Group Annual Report 2024

81

Notes to the Financial Statements continued

23. Earnings Per Share

23. Earnings Per Share
	Year ended	Year ended
	30 June 2024	30 June 2023
	Cents per share	Cents per share
Basic earnings per share	23.3	18.6
Diluted earnings per share	23.1	18.5

Reconciliation of earnings used in calculating earnings per share

	Year ended	Year ended
	30 June 2024	30 June 2023
	$’000	$’000
Net proft	22,364	16,077

Reconciliation of shares used in calculating earnings per share

	Year ended	Year ended
	30 June 2024	30 June 2023
	No.	No.
Opening and closing balance of shares for the period	86,365,798	86,285,762
Shares issued	17,014,280	80,036
Closing balance of shares for the period	103,380,078	86,365,798
Weighted average number of ordinary shares used in the calculation of basic earnings per share	96,039,605	86,345,843
Shares deemed to be issued for no consideration in respect of:
Employee performance Rights	617,355	674,742
Closing number of shares deemed to be issued for the period	103,997,433	87,040,540
Weighted average number of ordinary shares used in the calculation of diluted earnings per share	96,642,191	86,795,191

The weighted average number of shares for the year ended 30 June 2024 has been restated to reflect the proportion of shares post-share split that were on hand during the prior financial period.

82 IPD Group Annual Report 2024

24. Remuneration of Auditors

During the financial year, the following fees were paid or payable for services provided by PKF, the auditor of the company, its network firms and unrelated firms:

	2024	2023
	$’000	$’000
Audit services – PKF Audit and Assurance
Auditing and reviewing the fnancial statements	287	167
Other services PKF
Taxation service	21	56
Other consulting services	3	109
Tax due diligence relating to business acquisitions	15	–
Investigating accountant’s report and due diligence relating to business acquisitions	96	–
Total remuneration of auditors	422	332

25. Interests in Subsidiaries

The consolidated financial statements incorporate the assets, liabilities and results of the following wholly-owned subsidiaries in accordance with the accounting policy described in note 2:

	Principal place
	of business/	Percentage	Percentage
	Country of	Owned (%)	Owned (%)
	Incorporation	2024	2023
Addelec Power Services Pty Ltd	Australia	100	100
Control Logic Pty Ltd	Australia	100	100
High Technology Control Pty Ltd	Australia	100	100
IPD Colombo (PVT) Ltd	Sri Lanka	100	100
IPD Services Pty Ltd	Australia	100	100
EX Engineering Pty Ltd	Australia	100	–
CMI Operations Pty Ltd	Australia	100	–

IPD Group Annual Report 2024 83

Notes to the Financial Statements continued

26. Business Combinations

On 21 July 2023, IPD Group acquired 100% interest of EX Engineering Pty Ltd for a total consideration of $11,400,000 and obtained control. EX Engineering is a Perth-based business that specialises in the design, stocking, supply, modification, and repair of electrical hazardous area equipment. This acquisition is expected to significantly enhance IPD’s Ex equipment offering to clients, with a focus on expanding the EX Engineering business to the Eastern States.

The following table shows the assets acquired, liabilities assumed and the purchase consideration at the acquisition date:

	Fair Value
	$’000
Purchase Consideration
Cash	9,161
Shares issued	1,018
Contingent consideration	1,221
Total purchase consideration	11,400
Assets or liabilities acquired
Cash	892
Trade receivables	1,106
Inventories	1,914
Plant and equipment	29
Deferred tax assets	47
Other assets	187
Right-of-Use Assets	805
Trade payables	(698)
Current tax liabilities	(514)
Lease liability	(805)
Provisions	(97)
Other Liabilities	(558)
Total net identifiable assets	2,308
Identifiable assets acquired and liabilities assumed	2,308
Consideration	11,400
Less: Identifable assets acquired	(2,308)
Goodwill	9,092

The goodwill is attributable to EX Engineering Pty Ltd’s strong position and profitability in trading in the electrical hazardous area equipment market and synergies expected to arise after the company’s acquisition of the new subsidiary. None of the goodwill is expected to be deductible for tax purposes. See note 13 for the changes in goodwill as a result of the acquisition.

84 IPD Group Annual Report 2024

The Group applies provisional accounting for any business combination. Any reassessment of the fair value of the assets acquired or liabilities assumed during the earlier of the finalisation of the provisional accounting or 12 months from acquisition date is adjusted for retrospectively, with corresponding adjustments against goodwill. Thereafter, at each reporting date, any increase or decrease in the fair value of the assets acquired or liabilities assumed will result in a corresponding gain or loss recognised in profit or loss. The fair value of deferred tax assets and tax liabilities is provisional pending final valuations.

The contingent consideration arrangement requires the Group to pay the former owners of Ex Engineering Pty Ltd an Earn Out amount to be calculated as the Actual FY24 EBITDA minus the Actual FY23 EBITDA, times a pre-determined multiplier up to a maximum aggregate Purchase Price of $11.4 million.

On 28 November 2023, IPD announced it had entered into a conditional agreement to acquire 100% of the issued shares in CMI Operations, a leading distributor of electrical cables and manufacturer & distributor of plug brands in Australia, from ASXlisted Excelsior Capital Limited (ASX:ECL) for total consideration of up to $101.0 million. This consideration comprised an upfront payment of $92.1 million, subject to customary working capital and net debt adjustment, and a maximum contingent payment of $8.9 million. The CMI Operations acquisition was funded through a combination of a fully-underwritten $65 million equity raising and a new $40 million debt facility, and was completed on 31 January 2024.

The CMI Operations acquisition extends IPD’s product suite, increases supplier diversity, strengthens its overall value proposition with existing customers, and broadens customer reach.

The following table shows the assets acquired, liabilities assumed and the purchase consideration at the acquisition date:

	Fair Value
	$’000
Purchase Consideration
Cash	93,439
Total purchase consideration	93,439
Assets or liabilities acquired
Cash	1,891
Trade receivables	18,288
Inventories	28,504
Plant and equipment	569
Right-of-Use Assets	2,488
Deferred tax assets	279
Other assets	45
Intangibles	1,775
Trade payables	(10,515)
Lease liability	(2,488)
Provisions	(3,855)
Other Liabilities	(695)
Total net identifiable assets	36,286
Identifiable assets acquired and liabilities assumed	36,286
Consideration	93,439
Less: Identifable assets acquired	(36,286)
Goodwill	57,153

IPD Group Annual Report 2024 85

Notes to the Financial Statements continued

26. Business Combinations continued

The goodwill is attributable to CMI Operations strong position and profitability in trading in the cable and plug market, R&D and synergies expected to arise after the company’s acquisition of the new subsidiary. None of the goodwill is expected to be deductible for tax purposes. See note 13 for the changes in goodwill as a result of the acquisition.

The Group applies provisional accounting for any business combination. Any reassessment of the fair value of the assets acquired or liabilities assumed during the earlier of the finalisation of the provisional accounting or 12 months from acquisition date is adjusted for retrospectively, with corresponding adjustments against goodwill. Thereafter, at each reporting date, any increase or decrease in the fair value of the assets acquired or liabilities assumed will result in a corresponding gain or loss recognised in profit or loss. The fair value of deferred tax assets and tax liabilities is provisional pending final valuations.

If both of the acquisitions had occurred on 1 July 2023, consolidated revenue, and consolidated profit after tax for the year ended 30 June 2024 would have been $350,429,000 and $28,025,000 respectively.

27. Cash Flow Information

Reconciliation of result for the year to cashflows from operating activities

Reconciliation of net income to net cash provided by operating activities:

	2024	2023
	$’000	$’000
Proft for the year	22,364	16,077
Cash fows excluded from proft attributable to operating activities
Non-cash flows and non-operating cash items in profit:
– depreciation	5,818	4,368
– net (gain)/loss on disposal of property, plant and equipment	(120)	(48)
– interest on lease liabilities	460	480
– actuarial gain/(loss)	(47)	–
– performance rights expensed	599	419
– acquisition costs	1,221	–
Changes in assets and liabilities:
– (increase)/decrease in trade and other receivables	(25,746)	(7,362)
– (increase)/decrease in other assets	(546)	182
– (increase)/decrease in inventories	(36,592)	(9,419)
– (increase)/decrease in tax liability	(534)	1,072
– (increase)/decrease in deferred tax asset	(1,075)	(439)
– (increase)/decrease in fnancial assets	–	–
– (increase)/decrease in working capital on acquisition of subsidiary	33,438	–
– increase/(decrease) in trade and other payables	25,788	56
– increase/(decrease) in provisions	(1,663)	2,034
– increase/(decrease) in other liabilities	–	–
Cash flows from operations	23,365	7,420

86

IPD Group Annual Report 2024

28. Share Based Payments

At 30 June 2024 the Group has the following share based payment schemes:

The Company has established the EIP to assist in the motivation, reward and retention of senior management and other IPD employees from time to time. The EIP is designed to align the interests of senior management and other employees with the interests of Shareholders by providing an opportunity for employees to receive equity interests in the Company subject to the satisfaction of certain performance conditions. IPD may offer additional incentive schemes to the management and employees over time.

The EIP is a long-term incentive plan, under which options or performance rights to subscribe for or be transferred Shares (Plan Awards) may be offered to eligible employees (including a director employed in an executive capacity or any other person who is declared by the Board to be eligible) selected by the Directors at their discretion.

The invitations issued to eligible employees will include information such as the amount required to be paid for the Plan Award (if any), vesting conditions and any trading restrictions on dealing with Shares allocated on vesting or exercise of a Plan Award. Upon acceptance of an invitation, the Directors will grant Plan Awards in the name of the eligible employee. On vesting, one Plan Award is exercisable into or entitles the holder to one Share. Unless otherwise specified in an invitation, the Directors have the discretion to settle Plan Awards with a cash equivalent payment.

Share based payments granted during the current financial year:

			Grant date
	Effective	Number	fair value
Performance rights series	grant date	granted	$	Vesting date
Tranche 1	8/12/2023	70,388	229,037	30/09/2024
Tranche 2	8/11/2023	70,388	229,037	30/09/2025
Tranche 3	8/11/2023	70,387	229,033	30/09/2026

Where relevant, the expected life used in the model has been adjusted based on management’s best estimate for the effects on non-transferability, performance hurdles, and employment considerations.

	Grant date		Dividend
Performance rights series	fair value	Rights life	yield
Tranche 1	$3.25	1 Year	3.17%
Tranche 2	$3.25	2 Years	3.17%
Tranche 3	$3.25	3 Years	3.17%

IPD Group Annual Report 2024

87

Notes to the Financial Statements continued

28. Share Based Payments continued

	2024	2023
Movement in share based payments reserve	$’000	$’000
Balance at 1 July 2023	433	106
Recognised for the year:
– Performance rights granted	627	419
– Performance rights forfeited	(28)	–
Total recognised for the year	599	419
– Exercise of performance rights	(356)	(92)
Balance at 30 June 2024	676	433
	Weighted
	Average Fair
	Value	Number of
Details of LTI movement are as follows:	$	LTI issued
Balance at 30 June 2022		240,110
– Performance rights granted	1.64	514,668
– Performance rights exercised	1.20	(80,036)
Balance at 30 June 2023		674,742
– Performance rights granted	3.25	211,163
– Performance rights exercised	4.85	(251,593)
– Performance rights forfeited	1.64	(16,957)
Balance at 30 June 2024		617,355

88 IPD Group Annual Report 2024

29. Financial Instruments

Financial risk management objectives

The consolidated entity’s activities expose it to a variety of financial risks: market risk (including foreign currency risk) and credit risk. The consolidated entity’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 consolidated entity. The consolidated entity uses derivative financial instruments such as forward foreign exchange contracts to hedge certain risk exposures. Derivatives are exclusively used for hedging purposes, i.e. not as trading or other speculative instruments.

Foreign currency risk

Foreign currency forward contracts are used in the normal course of day-to-day business to hedge exposure to fluctuations in foreign exchange.

The maturity, settlement amounts and the average contractual exchange rates of the consolidated entity’s outstanding forward foreign exchange contracts at the reporting date were as follows:

	Sell Australian dollars $’000 Average exchange rates
	2024 2023 2024 2023
Buy US dollars Maturity 0 – 3 months 4 – 6 months	357 1,276 0.6540 0.6757 – – – –
Buy Euros Maturity 0 – 3 months 4 – 6 months	22 2,391 0.6069 0.6199 – – – –

89

IPD Group Annual Report 2024

Notes to the Financial Statements continued

29. Financial Instruments continued

The carrying amounts of the consolidated entity’s foreign currency denominated financial assets and financial liabilities at the reporting date were as follows:

reporting date were as follows:
	Assets $’000 Liabilities $’000
	2024 2023 2024 2023
US dollars Euros New Zealand dollars	34 33 – – 4 450 – – 12 103 – –
Total	50 586 – –

Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the consolidated entity. The consolidated entity has a strict code of credit, including obtaining agency credit information, confirming references and setting appropriate credit limits. The consolidated entity obtains guarantees where appropriate to mitigate credit risk. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the financial statements.

The following tables detail the consolidated entity’s remaining contractual maturity for its financial instrument liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining contractual maturities and therefore these totals may differ from their carrying amount in the statement of financial position:

	1 year	Between	Over
	or less	1 and 5 years	5 years	Total
2024	$’000	$’000	$’000	$’000
Non-derivatives
Non-interest bearing
Trade payables	50,448	–	–	50,448
Other payables	17,391	–	–	17,391
Interest bearing – fxed rate
Lease liability	4,326	10,134	241	14,701
Debt facility	–	31,100	–	31,100
Total non-derivatives	72,165	41,234	241	113,640
Derivatives
Forward foreign exchange contracts net settled	–	–	–	–
Total derivatives	–	–	–	–

90

IPD Group Annual Report 2024

	1 year	Between	Over
	or less	1 and 5 years	5 years	Total
2023	$’000	$’000	$’000	$’000
Non-derivatives
Non-interest bearing
Trade payables	33,287	–	–	33,287
Other payables	7,543	–	–	7,543
Interest bearing – fxed rate
Lease liability	3,454	10,108	786	14,348
Total non-derivatives	44,284	10,108	786	55,178
Derivatives
Forward foreign exchange contracts net settled	–	–	–	–
Total derivatives	–	–	–	–

The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed above.

Fair value of financial instruments

Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.

30. Key Management Personnel

The individuals within the Group who have been determined to be Key Management Personnel (KMP) for the period ended 30 June 2024 are those people who have the authority and responsibility for planning, directing and controlling the Group’s activities, either directly or indirectly. The Group’s key management personnel are the Directors of the company.

Compensation

The aggregate compensation made to key management personnel of the Group is set out below:

	2024	2023
	$’000	$’000
Short term employee benefts	1,537	1,506
Post employment benefts	94	78
Long term benefts	18	22
Share based payments	399	305
Total remuneration of key management personnel	2,048	1,911

91

IPD Group Annual Report 2024

Notes to the Financial Statements continued

31. Related Party Transactions

There were no related party transactions for the year ended 30 June 2024.

32. Parent Entity

The following information has been extracted from the books and records of the parent, IPD Group Ltd and has been prepared in accordance with Accounting Standards. The financial information for the parent entity, IPD Group Ltd has been prepared on the same basis as the financial statements except as disclosed below.

Investments in subsidiaries, associates and joint ventures

Investments in subsidiaries, associates and joint venture entities are accounted for at cost in the financial statements of the parent entity. Dividends received from associates are recognised in the parent entity profit or loss, rather than being deducted from the carrying amount of these investments.

	30 June 2024	30 June 2023
	$’000	$’000
Assets
Total current assets	101,770	107,889
Non-current assets	137,263	28,742
Total assets	239,033	136,631
Liabilities
Current liabilities	68,412	66,106
Non-current liabilities	39,755	11,539
Total liabilities	108,167	77,645
Equity
Issued capital	95,639	31,580
Share-based payments reserve	676	433
Retained earnings	34,551	26,973
Total equity	130,866	58,986
Summarised statement of profit and loss
Proft for the year	16,403	12,583

92 IPD Group Annual Report 2024

33. Events after the Reporting Date

No matters or circumstances have arisen since the end of the financial year which significantly affected or could significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial years.

34. Shareholders Information

Distribution of shareholders

As at 30 August 2024, the distribution of shareholding was as follows:

		Percentage
		of Issued	Number of	Distribution of
Size of shareholding	Shares held	Share Capital	shareholders	shareholders
1 – 1,000	917,160	0.89%	1,976	48.36%
1,001 – 5,000	3,472,284	3.36%	1,402	34.31%
5,001 – 10,000	2,636,055	2.55%	360	8.81%
10,001 – 100,000	7,278,632	7.04%	305	7.46%
Over 100,000	89,075,947	86.16%	43	1.05%
Total	103,380,078	100.00%	4,086	100.00%

Substantial shareholdings

The number of shares held by the substantial shareholders listed in the Company’s register of substantial shareholders as at 30 August 2024 were:

	Number	%
Shareholder	of shares	Held
Mohamed Yoosuff and Mary Yoosuff	11,284,704	10.92%
Keith William Toose & Kirry Elizabeth Toose	5,812,079	5.62%

93

IPD Group Annual Report 2024

Notes to the Financial Statements continued

34. Shareholders Information continued

	Number	%
Twenty largest shareholders	of shares	Held
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED	20,525,850	19.85%
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED	13,186,166	12.76%
MOHAMED YOOSUFF	11,284,704	10.92%
CITICORP NOMINEES PTY LIMITED	8,610,263	8.33%
KEITH WILLIAM TOOSE + KIRRY ELIZABETH TOOSE	5,812,079	5.62%
BNP PARIBAS NOMINEES PTY LTD	5,146,482	4.98%
UBS NOMINEES PTY LTD	3,812,565	3.69%
CL AUST PTY LTD	3,074,965	2.97%
MIRRABOOKA INVESTMENTS LIMITED	2,683,202	2.6%
MRS DORIS MARIE ROBINSON	1,793,452	1.73%
CERTANE CT PTY LTD	1,519,521	1.47%
MR AHMAD AMIRI	1,434,481	1.39%
CERTANE CT PTY LTD	1,369,619	1.32%
MICHAEL SAINSBURY	1,039,988	1.01%
MRS LYN JO-AN LINDEN	1,023,212	0.99%
ANDREW MAN-TAT CHAN + KWAN-CHING WONG	802,842	0.78%
CONTROL LOGIC SUPER PTY LTD	595,811	0.58%
BNP PARIBAS NOMS PTY LTD	593,335	0.57%
ANACACIA PTY LTD	591,739	0.57%
MR TERRENCE AUSTIN CHAPMAN + MRS ARZU AYLIN CHAPMAN	578,181	0.56%
Total top 20 shareholders	85,478,457	82.68%

Shareholders with less than a marketable parcel

As at 30 August 2024 there were 105 shareholders holding less than a marketable parcel of 108 ordinary shares in the company, totalling 7,508 ordinary shares.

Voting rights

The voting rights attached to ordinary shares are set out below:

Ordinary shares

On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote.

There are no other classes of equity securities.

94 IPD Group Annual Report 2024

35. Company Information

Directors	David Rafter, Chairman, Non-executive director
	Andrew Moffat, Non-executive director
	Michael Sainsbury, CEO
	Mohamed Yoosuff, Director of Strategic Development
Company secretary	Jade Cook
Notice of annual general meeting	The annual general meeting of IPD Group Limited will be held on the 26 November 2024
Registered office	43-47 Newton Road
	Wetherill Park NSW 2164
	Phone: 1300 556 601
Principal place of business	43-47 Newton Road
	Wetherill Park NSW 2164
	Phone: 1300 556 601
Share register	Computershare
	Yarra Falls
	452 Johnston Street,
	Abbotsford, Vic 3067
	Phone: (03) 9415 5000
Auditor	PKF
	Level 8, 1 O’Connell Street
	Sydney NSW 2000
Stock exchange listing	IPD Group Limited shares are listed on the Australian Securities Exchange
	(ASX code: IPG)
Website	www.ipdgroup.com.au

IPD Group Annual Report 2024 95

Consolidated Entity Disclosure Statement

The table below includes the consolidated entity information required by section 295 of the Corporations Act 2001 (Cth):

Entity Registered Name Entity Type Percentage of share capital held (%) Country of incorporation	Tax residency
	Australian or foreign Foreign jurisdiction
IPD Group Limited Body Corporate 100.00 Australia Addelec Power Services Pty Ltd Body Corporate 100.00 Australia Control Logic Pty Ltd Body Corporate 100.00 Australia High Technology Control Pty Ltd Body Corporate 100.00 Australia IPD Services Pty Ltd Body Corporate 100.00 Australia Ex Engineering Pty Ltd Body Corporate 100.00 Australia CMI Operations Pty Ltd Body Corporate 100.00 Australia IPD Colombo (PVT) Ltd Body Corporate 100.00 Sri Lanka	Australian N/A Australian N/A Australian N/A Australian N/A Australian N/A Australian N/A Australian N/A Foreign Sri Lanka

96 IPD Group Annual Report 2024

Corporate Directory

Registered office 43 Newton Road, Wetherill Park NSW 2164 Tel: (02) 9645 0777 Web: www.ipdgroup.com.au

Company Secretary

Jade Cook

Auditor

PKF(NS) Audit & Assurance Limited Partnership Level 8, 1 O’Connell Street Sydney NSW 2000 Tel: (02) 8346 6000 Web: www.pkf.com.au

Shareholder Registrar

Computershare Investor Services Pty Limited GPO Box 2975 Melbourne VIC 3001

Contact details

Address: Locked Bag A14 Sydney South NSW 1235 Tel: (Australia) 1300 850 505 (Overseas) +61 3 9415 4000 Web: www.investorcentre.com/au

IPD Group Investor Relations

investorrelations@ipdgroup.com.au

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