Half Yearly Report and Accounts
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THE AGENCY GROUP AUSTRALIA LTD
ABN 52 118 913 232
and its controlled entities
Interim Financial Report
31 December 2019
THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Corporate directory
Current Directors
Andrew Jensen Executive Chairman
Paul Niardone Managing Director
Mitchell Atkins Non-executive Director
Adam Davey Non-executive Director
Matthew LaHood Executive Director
Company Secretary
Mr Stuart Usher
Registered Office Share Registry
Street: 68 Milligan St Advanced Share Registry Limited
PERTH WA 6000 Street + Postal: 110 Stirling Highway
Postal: PO Box 7768 NEDLANDS WA 6009
CLOISTERS SQUARE WA 6850 Telephone: 1300 113 258 (within Australia)
Telephone: +61 (0)8 9204 7955 +61 (0)8 9389 8033 (International)
Facsimile: +61 (0)8 9204 7956 Facsimile: +61 (0)8 6370 4203
Email: info@theagencygroup.com.au Email: admin@advancedshare.com.au
Website: theagencygroup.com.au Website: www.advancedshare.com.au
Auditors Securities Exchange
Bentleys Audit & Corporate (WA) Pty Ltd Australian Securities Exchange
Level 3, 216 St Georges Terrace Level 40, Central Park, 152-158 St Georges Terrace
PERTH WA 6000 Perth WA 6000
Telephone: +61 (0)8 9226 4500 Telephone: 131 ASX (131 279) (within Australia)
Telephone: +61 (0)2 9338 0000
Solicitors Facsimile: +61 (0)2 9227 0885
Steinepreis Paganin Website: www.asx.com.au
Level 4, The Read Buildings ASX Code AU1
16 Milligan Street
Perth WA 6000
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Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Contents
n Results for Announcement to the Market.............................................................................................................................. 1
n Directors' report ..................................................................................................................................................................... 3
n Auditor's independence declaration ...................................................................................................................................... 8
n Condensed consolidated statement of profit or loss and other comprehensive income ...................................................... 9
n Condensed consolidated statement of financial position ................................................................................................... 10
n Condensed consolidated statement of changes in equity ................................................................................................... 11
n Condensed consolidated statement of cash flows ............................................................................................................... 12
n Notes to the condensed consolidated financial statements ................................................................................................ 13
n Directors' declaration ........................................................................................................................................................... 26
n Independent auditor's review report ................................................................................................................................... 27
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THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Results for Announcement to the Market
for the half-year Ended 31 December 2019
1 REPORTING PERIOD (item 1)
n Report for the period ended: 31 December 2019
n Previous corresponding period is half-year ended: 31 December 2018
Movement Percentage Amount
2 RESULTS FOR ANNOUNCEMENT TO THE MARKET
% $
n Revenues from ordinary activities (item 2.1) Increase 144.52 to 25,623,262
n Loss from ordinary activities after tax attributable to members Increase in
(14.50) to (1,674,164)
(item 2.2) loss
Increase in
n Loss after tax attributable to members (item 2.3) (14.50) to (1,674,164)
loss
a. Dividends (items 2.4 and 5) Amount per Franked amount
Security per security
₵ %
n Interim dividend nil n/a
n Final dividend nil n/a
n Record date for determining entitlements to the dividend
n/a
(item 2.5)
b. Brief explanation of any of the figures reported above necessary to enable the figures to be understood (item 2.6):
1. Revenue represents interest earned and service revenue.
2. Earnings before interest, tax, amortisation and depreciation (EBITDA) $1,484,510
3 DIVIDENDS (item 6) AND RETURNS TO SHAREHOLDERS INCLUDING DISTRIBUTIONS AND BUY BACKS
Nil.
a. Details of dividend or distribution reinvestment plans in operation are described below (item 6):
Not applicable
Previous
4 RATIOS
Current corresponding
period period
a. Financial Information relating to 4b: $ $
Earnings for the period attributable to owners of the parent (1,674,164) (1,958,009)
Net assets 18,847,215 9,031,007
Less: Intangible assets and deferred tax balances (39,245,291) (34,368,355)
Net tangible (liabilities)/assets (20,398,076) (25,337,348)
No. No.
Fully paid ordinary shares 298,954,431 103,810,047
₵ ₵
b. Net tangible (liability)/assets backing per share (cents) (item 3): (6.82) (24.41)
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Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Results for Announcement to the Market
for the half-year Ended 31 December 2019
5 DETAILS OF ENTITIES OVER WHICH CONTROL HAS BEEN GAINED OR LOST DURING THE PERIOD: (item 4)
a. Control gained over entities
n Name of entities (item 4.1) Nil
n Date(s) of gain of control (item 4.2) n/a
b. Loss of control of entities
n Name of entities (item 4.1) Nil
n Date(s) of loss of control (item 4.2) n/a
c. Contribution to consolidated loss from ordinary activities after tax by n/a
the controlled entities to the date(s) in the current period when
control was gained / lost (item 4.3).
d. Loss from ordinary activities after tax of the controlled entities for the n/a
whole of the previous corresponding period (item 4.3)
6 DETAILS OF ASSOCIATES AND JOINT VENTURES: (item 7)
n Name of entities (item 7) Nil
n Percentage holding in each of these entities (item 7) N/A
Current period Previous
corresponding
period
n Aggregate share of profits (losses) of these entities (item 7) N/A N/A
7 The financial information provided in the Appendix 4D is based on the interim final report (attached), which has been
prepared in accordance with Australian Accounting Standards.
8 The report is based on accounts which are have been reviewed by the Company’s independent auditor (item 9) and contain
the following emphasis of matter:
We draw attention to Note 1(ii) in the half year financial report, which indicates that the Group incurred a net loss after tax
of $1,674,164 during the half year ended 31 December 2019. As stated in Note 1(ii), these events or conditions, along with
other matters as set forth in Note 1(ii), indicate that a material uncertainty exists that may cast significant doubt on the
Group’s ability to continue as a going concern. Our conclusion is not modified in respect of this matter.
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THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Directors' report
Your directors present their report on the Group, consisting of The Agency Group Australia Ltd (The Agency or the Company)
and its controlled entities (collectively the Group), for the half-year ended 31 December 2019.
1. Directors
The names of Directors in office at any time during or since the end of the half-year are:
n Andrew Jensen Executive Chairman
n Paul Niardone Managing Director
n Mitchell Atkins Non-executive Director (Appointed 1 October 2019)
n Adam Davey Non-Executive Director
n Matthew LaHood Executive Director
n John Kolenda Non-executive Director (Resigned 1 October 2019)
Directors have been in office since the start of the half-year to the date of this report unless otherwise stated.
2. Operating and financial review
2.1. Operations review
Strong results, both operationally and financially, across the business for the six month period ending 31st December 2019
on the back of a marked improvement in the real estate sector on the eastern seaboard during the period.
In a significant milestone, the Group reported earnings before interest tax depreciation and amortisation (EBITDA) of $1.5
million, a significant turn-around.
The EBITDA positive result reflects the significant synergistical benefits being realised by the company 12 months on from
its acquisition of Top Level Real Estate Pty Ltd, the success of The Agency’s disruptive model in attracting and continuing to
attract the highest quality agents and business owners and the proactive cost reduction program being implemented during
FY2020.
Positive EBITDA was achieved on the back of $25.6 million revenue for the six-month period, a significant 145% increase on
the six-month period ending 31 December 2018 (HY2019: $10.5m).
Total gross commission income (GCI) for the Group for the six-month period totalled $24.9 million – up 41% from previous
corresponding period (HY2019: $17.7 million) and representing 66% of FY19 GCI of $38 million.
GCI ($M)
Up 41% Y-o-Y
24.9
17.7
10.9
3.8
HY FY17 HY FY18 HY FY19 HY FY20
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Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' report
TOTAL REVENUE ($M)
Up 145% Y-o-Y
25.6
10.5
6.9
HY FY18 HY FY19 HY FY20
GCI was due to 1,591 exchanges and more than $1.5 billion worth of property sold across the combined group for the six-
month period. This is compared to 719 exchanges worth approximately $382 million in the previous corresponding period.
VALUE OF EXCHANGES ($M)
Up 23% Y-o-Y
1517
1235
190.5
97.5
HY FY17 HY FY18 HY FY19 HY FY20
Looking ahead to the second half of FY2020, the Company remains confident revenue and commission growth will be
maintained as the real estate market shows further signs of improvement.
The pipeline for future sales is significant, with the combined group reporting 1,955 listings, up 87% on the previous
corresponding period.
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THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Directors' report
NUMBER OF NEW LISTINGS (#)
2500
Up 87% Y-o-Y
1955
2000
1500
1044
1000
492
500
251
0
HY FY17 HY FY18 HY FY19 HY FY20
Properties under management (PuM) also continues to be a source of strength for the Company with The Agency’s east
coast and west coast operations reporting a total management portfolio of 4,678 PuM as at 31st December 2019, up 11%
on the previous corresponding period (1H19: 4209PuM).
NUMBER OF PUM (#)
Up 11%Y-o-Y
4,678
4,209
3,382
HY FY18 HY FY19 HY FY20
The number of agents operating under the combined group were 278 as at 31st of December 2019, down from 292 agents
as at 31st December 2018. This follows Fair Work Australia’s recent legislative changes which resulted in the Company
performing a strategic review of the SLP agent network.
Post end of period, The Agency launched an office in Canberra – which holds an important position on our expansion
roadmap – appointing highly experienced property developer and agent Peter Micalos to the role of senior partner.
The Agency Canberra will offer residential and commercial sales, residential and commercial property management and
project marketing and sales.
Along with Mr Micalos’ project pipeline, that is estimated to grow to 2,000 units over 24 months and a total value of $1
billion, he will be establishing The Agency’s bricks-and-mortar hub in Canberra and initiating a major recruitment drive.
Canberra is on a growth trajectory with dwelling values increasing by 2.3% in December 2019 and 3.14% in January 2020.1
1
https://www.corelogic.com.au/research/monthly-indices
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Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' report
Cost reduction program
As part of the Company’s ongoing integration of The Agency’s East Coast and West Coast operations, a proactive cost
reduction program has been implemented across the combined group during FY2020.
During the six-month period, wage savings of approximately $678,000 have been realised as a result of streamlining the
business post-merger with Top Level Real Estate Pty Ltd.
Cost reductions of $2.5 million are expected to be delivered in FY20 with The Agency on target to meet these reductions.
Financial position
As at 31 December 2019, The Agency had cash and cash equivalents of $3.7 million – up from $1.1m as at 30 June 2019 –
$13.2 million debt plus a rent roll of $20.2 million.
Results Commentary
Commenting on the half year results, The Agency Group’s Managing Director Paul Niardone said:
I am thrilled to deliver yet another set of strong results for the HY2020 which included a maiden positive EBITDA of $1.5
million which includes adjustments from the adoption of the new AASB 16 leases standard (refer note 19) which had a
positive effect on EBITDA of approximately $1 million.
These results reflect the strength of our brand and why reputable real estate businesses and agents continue to join our
business as they realise we offer higher commissions, reduced risk and higher-level of support compared to franchise and
stand-alone businesses.
In addition, we are witnessing an improving housing market in which house values have risen across every capital city,
auction clearance rates have rapidly increased and fewer days on market for properties in Sydney and Melbourne. In Perth,
green shoots are emerging with a boost to property values in recent months.
We continued our national growth trajectory with the launch of an office in Canberra – which holds an important position
on our expansion roadmap – appointing highly experienced property developer and agent Peter Micalos to the role of senior
partner. According to CoreLogic data, Canberra is on a growth trajectory with dwelling values increasing by 2.3% in
December 2019 and 3.14% in January 2020.
The nation-wide improvement in the housing market is highly encouraging for The Agency and we anticipate building on
our strong half year 2020 result for the remainder of the financial year.
2.2. Financial Review
a. Operating results
For the half-year ended 31 December 2019 the Group delivered a loss after tax of $1,674,164 (31 December 2018:
$1,958,009 loss).
The financial statements have been prepared on a going concern basis, which contemplates the continuity of normal
business activity and the realisation of assets and the settlement of liabilities in the ordinary course of business. Details of
the Company's assessment in this regard can be found in Note 1a.ii Statement of significant accounting policies: Going
Concern on page 13.
b. Financial position
The net assets of the Group have increased from 30 June 2019 by $9,816,208 to $18,847,215 at 31 December 2019 (30
June 2019: $9,031,007).
As at 31 December 2019, the Group's cash and cash equivalents increased from 30 June 2019 by $1,109,233 to $3,706,532
(30 June 2019: $2,597,299) and had a working capital deficit of $17,958,652 (30 June 2019: $28,344,329 working capital
deficit).
2.3. Events Subsequent to Reporting Date
There are no other significant after balance date events that are not covered in this Directors' Report or within the financial
statements at Note 16 Events subsequent to reporting date.
2.4. Future Developments, Prospects and Business Strategies
Likely developments, future prospects and business strategies of the operations of the Group and the expected results of
those operations have not been included in this report as the Directors believe that the inclusion of such information would
be likely to result in unreasonable prejudice to the Group.
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THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Directors' report
3. Auditor's independence declaration
The lead auditor's independence declaration under section 307C of the Corporations Act 2001 (Cth) for the half-year ended
31 December 2019 has been received and can be found on page 8 of the interim financial report.
Signed in accordance with a resolution of directors made pursuant to s306(3) of the Corporations Act 2001 (Cth).
PAUL NIARDONE
Managing Director
Dated this Saturday, 29 February 2020
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To The Board of Directors
Auditor’s Independence Declaration under Section 307C of the
Corporations Act 2001
As lead audit partner for the review of the financial statements of The Agency Group
Australia Ltd for the half year ended 31 December 2019, I declare that to the best of my
knowledge and belief, there have been no contraventions of:
the auditor independence requirements of the Corporations Act 2001 in relation to
the review; and
any applicable code of professional conduct in relation to the review.
Yours faithfully
BENTLEYS DOUG BELL CA
Chartered Accountants Partner
Dated at Perth this 29th day of February 2020
THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Condensed consolidated statement of profit or loss and other comprehensive income
for the half-year ended 31 December 2019
Note 31 December 31 December
2019 2018
$ $
Continuing operations
Revenue 3a 24,707,033 10,443,788
Other income 3b 916,229 35,285
Advertising and promotion expenses (3,599,622) (150,967)
Computers and information technology expenses (605,522) -
Consultancy fees (762,645) (216,700)
Depreciation and amortisation (3,039,016) (219,392)
Doubtful debts - (9,410)
Interest expense (1,046,834) (340,780)
Legal, professional, and valuation fees (849,216) (997,159)
Rent and outgoings (456,626) (46,282)
Salaries and employee benefits expenses (16,555,888) (9,128,308)
Other expenses (1,314,252) (1,480,536)
Loss before tax (2,606,359) (2,110,461)
Income tax credit / (expense) 932,195 152,452
Net loss for the half-year (1,674,164) (1,958,009)
Other comprehensive income for the half-year, net of tax - -
Total comprehensive income attributable to members of the parent entity (1,674,164) (1,958,009)
Earnings per share: ₵ ₵
Basic and diluted loss per share (cents per share) 4 (0.80) (5.37)
The condensed consolidated statement of profit or loss and other comprehensive income is to be read in conjunction with the accompanying notes.
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Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Condensed consolidated statement of financial position
as at 31 December 2019
Note 31 December 30 June
2019 2019
$ $
Current assets
Cash and cash equivalents 5 3,706,532 2,597,299
Trade and other receivables 6a 5,800,864 4,493,365
Total current assets 9,507,406 7,090,664
Non-current assets
Trade and other receivables 6b 546,967 282,772
Financial assets 7 790,305 1,142,387
Plant and equipment 8 2,180,666 2,577,550
Right of use asset 13a 5,493,336 -
Intangible assets 9 37,487,639 39,036,212
Total non-current assets 46,498,913 43,038,921
Total assets 56,006,319 50,129,585
Current liabilities
Trade and other payables 10a 11,719,707 13,555,575
Borrowings 11 13,176,245 21,126,603
Provisions 12a 812,424 752,815
Leases 13b 1,757,682 -
Total current liabilities 27,466,058 35,434,993
Non-current liabilities
Trade and other payables 10b - 35,308
Provisions 12b 1,146,849 960,420
Leases 13b 4,810,513 -
Deferred tax liabilities 3,735,684 4,667,857
Total non-current liabilities 9,693,046 5,663,585
Total liabilities 37,159,104 41,098,578
Net assets 18,847,215 9,031,007
Equity
Issued capital 14a 39,438,803 27,765,049
Reserves 14b 855,915 583,426
Accumulated losses (21,447,503) (19,317,468)
Total equity 18,847,215 9,031,007
(17,958,652) (28,344,329)
(27,882,689) (38,408,746)
The condensed consolidated statement of financial position is to be read in conjunction with the accompanying notes.
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THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Condensed consolidated statement of changes in equity
for the half-year ended 31 December 2019
Note
Contributed Accumulated Options Total
equity Losses Reserve equity
$ $ $ $
Balance at 1 July 2018 11,480,382 (11,564,475) 566,430 482,337
Loss for the half-year attributable owners of the parent - (1,958,009) - (1,958,009)
Other comprehensive income for the half-year attributable
owners of the parent - - - -
Total comprehensive income for the half-year attributable
owners of the parent - (1,958,009) - (1,958,009)
Transaction with owners, directly in equity
Shares issued during the half-year (net of costs) - - - -
Options granted during the half-year - - - -
Balance at 31 December 2018 11,480,382 (13,522,484) 566,430 (1,475,672)
Balance at 1 July 2019 27,765,049 (19,317,468) 583,426 9,031,007
Effects of AASB 16 19 - (455,871) - (455,871)
Restated total equity at the beginning of the financial year 27,765,049 (19,773,339) 583,426 8,575,136
Loss for the half-year attributable owners of the parent - (1,674,164) - (1,674,164)
Other comprehensive income for the half-year attributable
owners of the parent - - - -
Total comprehensive income for the half-year attributable
owners of the parent - (1,674,164) - (1,674,164)
Transaction with owners, directly in equity
Shares issued during the half-year (net of costs) 14a 11,673,754 - - 11,673,754
Share based payments during the half-year 14b - - 272,489 272,489
Balance at 31 December 2019 39,438,803 (21,447,503) 855,915 18,847,215
The condensed consolidated statement of changes in equity is to be read in conjunction with the accompanying notes.
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Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Condensed consolidated statement of cash flows
for the half-year ended 31 December 2019
Note 31 December 31 December
2019 2018
$ $
Cash flows from operating activities
Receipts from customers 25,027,127 9,463,450
Payments to suppliers and employees (25,807,380) (9,413,532)
Interest received 17,577 -
Interest paid (697,333) (340,780)
Net cash used in operating activities (1,460,009) (290,862)
Cash flows from investing activities
Purchase of plant and equipment (77,776) (53,578)
Advancement of bank guarantees (404,015) -
Bank guarantees returned 321,078 -
Payment for intangibles (171,818) -
Payments for deferred consideration (15,000) (266,011)
Net cash used in investing activities (347,531) (319,589)
Cash flows from financing activities
Proceeds from issue of shares 5,611,773 500,000
Share issue costs (355,000) -
Proceeds from borrowings - 250,000
Repayment of borrowings (2,340,000) -
Net cash provided by financing activities 2,916,773 750,000
Net increase/(decrease) in cash held 1,109,233 139,549
Cash and cash equivalents at the beginning of the half-year 2,597,299 1,021,887
Cash and cash equivalents at the end of the half-year - 5 3,706,532 1,161,436
The consolidated statement of cash flows is to be read in conjunction with the accompanying notes.
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THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 1 Statement of significant accounting policies
These are the condensed consolidated financial statements and notes of The Agency Group Australia Ltd (The Agency or the
Company) and controlled entities (collectively the Group). The Agency is a company limited by shares, domiciled and
incorporated in Australia.
The financial statements were authorised for issue on 29 February 2020 by the directors of the Company.
a. Basis of preparation
This interim financial report is intended to provide users with an update on the latest annual financial statements of The Agency
Group Australia Ltd and controlled entities. As such, it does not contain information that represents relatively insignificant
changes occurring during the half-year within the Group. It is therefore recommended that this financial report be read in
combination with the annual financial statements of the Group for the year ended 30 June 2019, together with any public
announcements made during the half-year.
i. Statement of compliance
The half-year financial report is a general purpose financial report prepared in accordance with the Corporations Act 2001
and AASB 134 Interim Financial Reporting. Compliance with AASB 134 ensures compliance with International Financial
Reporting Standard IAS 34 Interim Financial Reporting. The half-year report does not include notes of the type normally
included in an annual financial report and shall be read in conjunction with the most recent annual financial report.
ii. Going Concern
This report has been prepared on the going concern basis, which contemplates the continuity of normal business activity
and the realisation of assets and liabilities in the normal course of business. The Group incurred a loss after tax for the half
year ended 31 December 2019 of $1,674,164 (2018: $1,958,009) and net cash out-flow from operating activities of
$1,460,009 (2018: $290,862 out-flow). At balance date there was a working capital deficit of $17,958,652 (30 June 2019:
$28,344,329 deficit). Included in the working capital deficit is $12,093,235 in relation to the Group’s Macquarie Bank Finance
Facility which is due and payable as at 31 March 2020. The Group has received offers to refinance the facility, however as
at the date of this report the refinancing is incomplete.
During the half-year ended 31 December 2019, the Group successful raised $5.6 million (before costs) from capital raisings
and converted debt and payables of $7.0 million to equity.
The ability of the Group to continue as a going concern is dependent on refinancing its Macquarie Bank Finance Facility,
generating profits and positive cash flows from operating activities and in the event these are not achieved raising capital
from equity markets.
The directors have prepared a cash flow forecast, which indicates that the Group will have sufficient cash flows to meet all
commitments and working capital requirements for the 12-month period from the date of signing this financial report.
Based on the cash flow forecasts and other factors referred to above, the directors are satisfied that the going concern basis
of preparation is appropriate. In particular, given the Company’s history of raising capital to date, the directors are confident
of the Company’s ability to raise additional funds as and when they are required.
Should the Group be unable to continue as a going concern it may be required to realise its assets and extinguish its liabilities
other than in the normal course of business and at amounts different to those stated in the financial statements. The
financial statements do not include any adjustments relating to the recoverability and classification of asset carrying
amounts or to the amount and classification of liabilities that might result should the Company be unable to continue as a
going concern and meet its debts as and when they fall due.
iii. Use of estimates and judgments
The preparation of consolidated financial statements requires management to make judgements, estimates and assumptions
that affect the application of policies and reported amounts of assets and liabilities, income and expenses. These estimates
and associated assumptions are based on historical experience and various factors that are believed to be reasonable under
the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised
in the period in which the estimate is revised and in any future periods affected.
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Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 1 Statement of significant accounting policies
b. Accounting Standards that are mandatorily effective for the current reporting period
The Group has consistently applied the following accounting policies to all periods presented in the financial statements. The
Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards
Board (the AASB) that are relevant to its operations and effective for an accounting period that begins on or after 1 January
2019.
New and revised Standards and amendments thereof and Interpretations effective for the current year that are relevant to
the Group include:
n AASB 16: Leases
AASB 16 removes the classification of leases as either operating leases or finance leases for the lessee effectively
treating all leases as finance leases. Short term leases (less than 12 months) and leases of a low value are exempt from
the lease accounting requirements. Lessor accounting remains similar to current practice. The financial impact from
the adoption of this standard is disclosed in note 19.
c. Changes in accounting policies, accounting standards and interpretations
The accounting policies adopted in the preparation of the interim consolidated financial statements are consistent with those
followed in the preparation of the Group’s annual consolidated financial statements for the year ended 30 June 2019, with
the exception of AASB 16 Leases as detailed above. All applicable new standards and interpretations issued since 1 July 2019
have been adopted. There was no significant impact on the Group, other than as disclosed in note 19.
Note 2 Company details
The registered office of the Company is:
Street + Postal: Suite 1 GF, 437 Roberts Road
SUBIACO WA 6008
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THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 3 Revenue and other income 31 December 31 December
2019 2018
$ $
a. Revenue
Commissions 17,526,872 7,011,868
Fees 2,987,787 2,521,730
Management fees 4,192,374 910,190
24,707,033 10,443,788
b. Other Income
Interest income 17,577 9,765
Other income 898,652 25,520
916,229 35,285
Note 4 Earnings per share (EPS) Note 31 December 31 December
2019 2018
$ $
a. Reconciliation of earnings to profit or loss
Loss for the half-year (1,674,164) (1,958,009)
Loss used in the calculation of basic and diluted EPS (1,674,164) (1,958,009)
31 December 31 December
2019 2018
No. No.
b. Weighted average number of ordinary shares outstanding during the year
used in calculation of basic EPS 209,614,095 36,468,962
31 December 31 December
2019 2018
c. Earnings per share ₵ ₵
Basic EPS (cents per share) 4d (0.80) (5.37)
d. As at 31 December 2019 the Group has 102,181,760 unissued shares under options (31 December 2018: 10,335,928). The Group
does not report diluted earnings per share on losses generated by the Group. The Group does not report diluted earnings per share
on losses generated by the Group. During the half-year ended 31 December 2019 the Group's unissued shares under option and
partly-paid shares were anti-dilutive.
Note 5 Cash and cash equivalents 31 December 30 June
2019 2019
$ $
a. Current
Cash at bank 3,706,532 2,597,299
3,706,532 2,597,299
P a g e | 15
Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 6 Trade and other receivables 31 December 30 June
2019 2019
$ $
a. Current
Trade debtors 3,726,656 3,189,133
Prepaid expenses 138,644 397,285
Recoverable commissions/wages 1,063,723 871,650
Deposits paid 460,828 16,207
Other receivables 561,013 277,818
Provision for non-recovery of commissions/wages (150,000) (258,728)
5,800,864 4,493,365
b. Non-current
Receivables 546,967 282,772
546,967 282,772
Note 7 Financial assets 31 December 30 June
2019 2019
$ $
a. Non-current
Bank guarantees 790,305 1,085,476
Financial assets carried at FVOCI – Listed shares - 56,911
790,305 1,142,387
Note 8 Property, plant, and equipment 31 December 30 June
2019 2019
$ $
Plant and equipment – at cost 1,201,206 1,059,513
Accumulated depreciation (561,083) (376,536)
640,123 682,977
Leasehold improvements – at cost 3,270,782 3,279,339
Accumulated depreciation (1,730,239) (1,384,766)
1,540,543 1,894,573
Total plant and equipment 2,180,666 2,577,550
P a g e | 16
THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 9 Intangible assets 31 December 30 June
2019 2019
$ $
Rent roll 20,243,658 21,958,595
Goodwill 17,077,617 17,077,617
Other 166,364 -
Total intangibles 37,487,639 39,036,212
Refer to note 20 for business combinations which occurred during 2019. The goodwill with respect to the acquisition has been accounted for
on a provisional basis.
Note 10 Trade and other payables 31 December 30 June
2019 2019
$ $
a. Current
Trade creditors 1,846,361 4,179,473
Employees’ remuneration – commissions payable 1,356,622 1,177,955
Payroll tax 1,102,890 1,121,583
Superannuation – employees 616,716 577,520
Sundry creditors and accrued expenses 2,859,773 2,017,403
Lease incentive - 719,158
GST and PAYG payables 3,680,792 3,255,827
Retention payable - 506,656
Interest payable 256,553 -
11,719,707 13,555,575
b. Non-current
Other - 35,308
- 35,308
P a g e | 17
Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 11 Borrowings 31 December 30 June
2019 2019
$ $
a. Current
Loans (i) 750,000 1,350,000
Bank loans (II) 12,093,235 12,593,235
Shareholder loans 211,849 7,157,366
Other 121,161 26,002
13,176,245 21,126,603
(I) Loan payable to Kalonda Pty Ltd with an interest rate of 10.5% for a term until 30 June 2020. Shares are held as security for
the debt.
(II) The Macquarie Bank Loan Facility has a first ranking charge over all the consolidated group companies and has a term until
31 March 2020.
Note 12 Provisions 31 December 30 June
2019 2019
$ $
a. Current
Employee entitlements 812,424 752,815
812,424 752,815
b. Non-current
Employee entitlements 258,474 329,638
Future fund referrals 738,375 480,782
Other 150,000 150,000
1,146,849 960,420
Note 13 Leases 31 December 30 June
2019 2019#
$ $
a. Right of use assets
Right of use assets 19 5,493,336 -
5,493,336 -
b. Lease liabilities
Current 19 1,757,682 -
Non-current 19 4,810,513 -
6,568,195 -
#
Refer to note 19 for further details on the adoption of AASB 16 leases.
P a g e | 18
THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 14 Issued capital Note 31 December 30 June 31 December 30 June
2019 2019 2019 2019
No. No. $ $
Fully paid ordinary shares at no par value 298,954,431 103,810,047 39,438,803 27,765,049
6 months to 6 months to
31 December 12 months to 31 December 12 months to
2019 30 June 2019 2019 30 June 2019
a. Ordinary shares No. No. $ $
At the beginning of the period 103,810,047 683,793,034 27,765,049 11,480,382
Shares issued during the period/year:
n Bonus issue of shares - 410,275,820 - -
Sub-total 1,094,068,854 -
n Effect of share consolidation 30:1 - (1,057,598,807) -
n Shares after consolidation - 36,470,047 -
n Issued on acquisition of Top Level Pty Ltd - 35,000,000 - 7,566,667
n Issued on acquisition of Vicus
Residential Pty Ltd - 2,666,667 - 453,333
n Issued to lead manager - 840,000 - 252,000
n Issued for cash 85,913,817 28,000,000 5,584,398 8,400,000
n Share-settled payments 14c 107,008,316 833,333 6,955,540 116,667
n Conversion of performance shares 2,222,251 - - -
Transaction costs relating to share issues - - (866,184) (504,000)
At reporting date 298,954,431 103,810,047 39,438,803 27,765,049
31 December 30 June 31 December 30 June
2019 2019 2019 2019
b. Options No. No. $ $
Options 102,181,760 5,588,912 855,915 583,426
At the beginning of the period 5,588,912 186,742,739 583,426 566,430
Options issued/(lapsed) during the year:
n Effect of share consolidation 30:1 - (180,517,958) - -
n Options after consolidation - 6,224,781 - -
n Expiry of options - (969,202) - -
n Issue of options to director - 333,333 - 16,996
n Attaching options issued pursuant
to Placement 8,461,539 - - -
n Attaching options issued pursuant
to the Entitlement Issue 79,440,194 - - -
n Issued to the Joint Lead Managers 14c 12,899,074 - 258,192 -
n Issued in repayment of Kalonda debt 14c 714,286 - 14,297 -
n Expiry of options (4,922,245) - - -
At reporting date 102,181,760 5,588,912 855,915 583,426
P a g e | 19
Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 14 Issued capital (cont)
c. Share-settled Payments
As approved by shareholders at general meetings during the half year:
n 11,138,462 shares with a fair value of $0.065 per share totalling $724,000 were issued to third party consultants in lieu
of cash for services performed.
n 5,782,551 shares with 2,891,275 attaching options were issued to Daring Investments Pty Ltd a company controlled by
Mr John Kolenda to settle outstanding loans of $375,866.
n 19,244,088 shares with 9,622,044 attaching options were issued to Teldar Real Estate Pty Ltd a company controlled by
Mr Matt Lahood to settle outstanding loans of $1,250,865
n 18,963,307 shares with 9,481,653 attaching options were issued to MAK Property Group Pty Ltd a company controlled
by Mr Shad Hassen to settle outstanding loans of $$1,232,615
n 18,963,307 shares with 9,481,653 attaching options were issued to Ben Collier Investments Pty Ltd a company
controlled by Mr Ben Collier to settle outstanding loans of $1,232,615
n 19,244,088 shares with 9,622,044 attaching options were issued to SEMC 2 Pty Ltd a company controlled by Mr Steven
Chen to settle outstanding loans of $1,250,866
n 7,692,308 shares with 3,846,154 attaching options were issued to Kalonda Pty Ltd to settle outstanding loans of
$500,000.
n 714,286 options were issue to Kalonda Pty Ltd as a debt facilitation fee with a fair value of 14,297.
n 12,899,074 options with a fair value of $258,192 were issued to the Joint Lead Manager in consideration for capital
raising services.
The following shares were issued to directors to settle outstanding directors fees:
Amount Shares
S No.
Mr Paul Niardone 116,719 1,795,682
Mr Andrew Jensen 118,500 1,823,077
Mr John Kolenda 87,494 1,346,061
Mr Adam Davey 66,000 1,015,385
Total 388,713 5,980,205
Note 15 Commitments
Other than for the adoption of AASB 16 leases (refer note 19) there has not been a material change to the Company’s
commitments since 30 June 2019.
Note 16 Events subsequent to reporting date
There are no other material events subsequent to reporting date.
Note 17 Contingent liabilities
There has been no change in contingent liabilities since the last annual report.
P a g e | 20
THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 18 Operating segments 2014 2013
$ $
a. Segment Performance
Real Estate Mortgage Total
Property Origination Reportable Other
Services Services Segments Segments Total
Half-Year ended 31 December 2019 $ $ $ $ $
Revenue
n External revenues 24,200,992 1,422,270 25,623,262 - 25,623,262
n Inter-segment revenues - - - - -
Total segment revenue 24,200,992 1,422,270 25,623,262 - 25,623,262
Reconciliation of segment revenue to group revenue:
n Eliminations -
Total group revenue and other income 25,623,262
Segment Profit / (Loss) from continuing operations
before tax 2,546,379 466,565 3,012,944 (1,533,453) 1,479,491
Reconciliation of segment loss to group loss:
(i) Unallocated items:
n Corporate costs - - - - -
n Depreciation and amortisation (3,038,224) (792) (3,039,016) - (3,039,016)
n Net finance costs (193,300) - (193,300) (853,534) (1,046,834)
Profit before income tax _ (2,606,359)
Real Estate Mortgage Total
Property Origination Reportable Other
Services Services Segments Segments Total
Half-Year ended 31 December 2018 $ $ $ $ $
Revenue
n External revenues 8,925,238 1,528,515 10,453,753 25,520 10,479,273
n Inter-segment revenues - - - 438,000 438,000
Total segment revenue 8,925,238 1,528,515 10,453,753 463,520 10,917,273
Reconciliation of segment revenue to group revenue:
n Eliminations (438,000)
Total group revenue and other income 10,479,273
Segment Profit / (Loss) from continuing operations
before tax (954,165) 421,078 (533,087) (50,479) (583,566)
Reconciliation of segment loss to group loss:
(i) Unallocated items:
n Corporate costs - - - (966,723) (966,723)
n Depreciation and amortisation (209,006) (1,419) (210,425) (8,967) (219,392)
n Net finance costs (196,594) (16,678) (213,272) (127,508) (340,780)
Profit before income tax _ (2,110,461)
P a g e | 21
Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 19 Effects of Adoption of AASB 16 Leases
This note explains the impact of the adoption of AASB 16 Leases on the Group’s financial statements and discloses the new
accounting policies that have been applied from 1 July 2019. The Group has adopted AASB 16 retrospectively from 1 July 2019,
but has not restated comparatives for the 30 June 2019 reporting period, as permitted under the specific transitional provisions
in the standard. The reclassifications and the adjustments arising from the new leasing rules are therefore recognised in the
opening balance sheet on 1 July 2019.
a. Adjustments recognised on adoption of AASB 16
On adoption of AASB 16, the Group recognised lease liabilities in relation to leases which had previously been classified as
operating leases under AASB117 Leases. These liabilities were measured at the present value of the remaining lease payments,
discounted using the lessee’s incremental borrowing rate as of 1 January 2019. The weighted average lessee’s incremental
borrowing rate applied to the lease liabilities on 1 July 2019 was 5.45%.
31 December
2019
$
Operating lease commitments disclosed as at 30 June 2019 6,863,161
Discounted using the lessee’s incremental borrowing rate of at the date of initial application 6,079,979
Add/(less): adjustments as a result of a different treatment of:
Short term leases (46,059)
Lease incentives receivable (740,778)
Extension options 734,821
Lease liability recognised as at 1 July 2019 6,027,963
Of which are:
• Current lease liabilities 1,466,150
• Non-current lease liabilities 4,561,813
6,027,963
The associated right-of-use assets for leases were measured on a retrospective basis as if the new rules had always been
applied, other than those for which this could not be determined, which are measured at the amount equal to the lease
liability, adjusted by the amount of any prepaid or accrued lease payments relating to that lease recognised in the balance
sheet as at 30 June 2019. There were no onerous lease contracts that would have required an adjustment to the right-of-use
assets at the date of initial application.
The recognised right-of-use assets were as follows:
31 December 1 July
2019 2019
$ $
Right of use of assets 5,493,336 4,897,881
Total right-of-use assets 5,493,336 4,897,881
P a g e | 22
THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 19 Effects of Adoption of AASB 16 Leases (continued)
The change in accounting policy affected the following items in the balance sheet on 1 July 2019:
• Right-of-use assets – increase by $4,897,881
• Lease liabilities – increase by $6,027,963
• Lease incentive liability – decrease by $719,158
• Prepaid expenses – decrease by $94,226
• Accrued expenses – decrease by $49,279
• Accumulated losses – decrease by $455,871
b. Practical expedients applied
In applying AASB 16 for the first time, the Group has used the following practical expedients permitted by the standard:
• the use of a single discount rate to a portfolio of leases with reasonably similar characteristics
• reliance on previous assessments on whether leases are onerous
• the accounting for operating leases with a remaining lease term of less than 12 months as at 1 July 2019 as short-term
leases
• the exclusion of initial direct costs for the measurement of the right-of-use asset at the date of initial application, and
• the use of hindsight in determining the lease term where the contract contains options to extend or terminate the lease
The group has also elected not to reassess whether a contract is, or contains a lease at the date of initial application. Instead,
for contracts entered into before the transition date the group relied on its assessment made applying AASB 117 and
Interpretation 4 Determining whether an Arrangement contains a Lease.
c. The group’s leasing activities and how these are accounted for
Until the 2019 financial year, leases of property were classified as either finance or operating leases. Payments made under
operating leases (net of any incentives received from the lessor) were charged to profit or loss on a straight-line basis over the
period of the lease.
From 1 July 2019, leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased
asset is available for use by the Group. Each lease payment is allocated between the liability and finance cost. The finance cost
is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance
of the liability for each period. The right-of-use asset is depreciated over the shorter of the asset's useful life and the lease
term on a straight-line basis
d. Key estimates – Extension and termination options
An extension options is included in a property lease of Group. These terms are used to maximise operational flexibility in terms
of managing contracts. The extension option held is exercisable only by the Group and not by the respective lessor.
In determining the lease term, management considers all facts and circumstances that create an economic incentive to
exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options)
are only included in the lease term if the lease is reasonably certain to be extended (or not terminated). The assessment is
reviewed if a significant event or a significant change in circumstances occurs which affects this assessment and that is within
the control of the lessee.
P a g e | 23
Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 20 Business Combinations
a. Acquisition of Top Level and Real Estate Assets
On 17 January 2019, the Group announced that its 100% owned subsidiary Ausnet had completed its 100% acquisition of Top
Level Real Estate Pty Ltd (“Top Level”), in accordance with the Amended and Restated Option Agreement, terms announced
on the ASX on 19 September 2018. For the purposes of these financial statements, the results of Top Level have been included
beginning on 11 January 2019 when control effectively passed, with the considerations shares issued in respect to 18,333,333
ordinary fully paid shares, valued at the closing price on 11 January 2019 of 14 cents, giving a market value of $2,566,667.
Top level is a private Australian company established in 2016 as a residential sales, project marketing, commercial sales and
leasing and property management business.
Details of the purchase consideration, the net assets acquired and goodwill are as follows:
Goodwill has been provisionally accounted for as management is undertaking the process of identifying separately the
identifiable assets.
Goodwill is calculated as the difference between the fair value of consideration transferred less the fair value of the identified
net assets of Top level. Details of the transaction are as follows:
The assets and liabilities recognised as a result of the acquisition are as follows:
Fair Value
$
Cash and cash equivalents 594,258
Trade and Other Receivables 2,831,759
Prepayments 170,942
Property, plant & equipment 2,155,716
Other – bank guarantees 121,637
Trade and other payables (6,767,664)
Borrowings (25,553,559)
Provisions (1,234,080)
Other – lease incentive liabilities (716,263)
Fair value of assets and liabilities acquired (28,397,254)
Add: Goodwill –accounted for 15,962,136
Add: Identifiable Intangible Assets - Rent Rolls acquired 20,692,117
Deferred Tax liability (5,690,332)
Satisfied by:
Ordinary shares issued 2,566,667
2,566,667
Net cash inflow arising on acquisition:
Cash paid Nil
Less: Balances acquired
Cash 594,258
594,258
Net inflow of cash – investing activities 594,258
i. Revenue and profit contribution
The acquired business contributed revenues of $10,155,115 and net loss of $2,818,080 to the group for the period from
11 January to 30 June 2019.
P a g e | 24
THE AGENCY GROUP AUSTRALIA LTD Interim Financial Report
AND CONTROLLED ENTITIES 31 December 2019
ABN 52 118 913 232
Notes to the condensed consolidated financial statements
for the half-year ended 31 December 2019
Note 20 Business Combinations
b. Acquisition of Vicus Residential
The Agency completed the acquisition of Vicus Residential - the residential sales and management division of The Vicus
Property Group – completed on 11 January 2019 with settlement of 2,666,667 shares and a $67,500 cash payment as
payment for all of Vicus Residential’s issued shares after receiving shareholder approval on 15 November 2018. The total
acquisition cost is $535,833.
The initial accounting for the acquisition of Vicus Residential has not been determined at this date.
Details of the purchase consideration, the net assets acquired and goodwill are as follows:
Goodwill has been provisionally accounted for.
Fair Value
$
Consideration
Provisional cash payment 67,500
Consideration shares 453,333
Goodwill 535,833
Fair value of assets and liabilities held at acquisition date:
Intangible assets 535,833
Fair value of identifiable assets and liabilities assumed 535,833
P a g e | 25
Interim Financial Report THE AGENCY GROUP AUSTRALIA LTD
31 December 2019 AND CONTROLLED ENTITIES
ABN 52 118 913 232
Directors' declaration
The Directors of the Company declare that:
1. The condensed financial statements and notes, as set out on pages 9 to 25, are in accordance with the Corporations Act
2001 (Cth) and:
(a) comply with Accounting Standard AASB 134: Interim Financial Reporting; and
(b) give a true and fair view of the financial position as at 31 December 2019 and of the performance for the half-year
ended on that date of the Company.
2. in the directors' opinion there are reasonable grounds to believe that the Company will be able to pay its debts as and when
they become due and payable.
This declaration is made in accordance with a resolution of the Board of Directors pursuant to s303(5) of the Corporations Act
2001 (Cth) and is signed for and on behalf of the directors by:
PAUL NIARDONE
Managing Director
Dated this Saturday, 29 February 2020
P a g e | 26
Independent Auditor’s Review Report
To the Members of The Agency Group Australia Ltd
We have reviewed the accompanying half-year financial report of The Agency Group
Australia Ltd (“the Company”) and Controlled Entities (“the Consolidated Entity”) which
comprises the consolidated statement of financial position as at 31 December 2019, the
consolidated statement of profit or loss and other comprehensive income, consolidated
statement of changes in equity and consolidated statement of cash flows for the half-year
ended on that date, a statement of accounting policies, other selected explanatory notes
and the directors’ declaration of the Consolidated Entity, comprising the Company and
the entities it controlled during the half-year.
Directors Responsibility for the Half-Year Financial Report
The directors of the Company are responsible for the preparation of the half-year
financial report that gives a true and fair view in accordance with Australian Accounting
Standards and the Corporations Act 2001 and for such control as the directors determine
is necessary to enable the preparation of the half-year financial report that gives a true
and fair view and is free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express a conclusion on the half-year financial report based on
our review. We conducted our review in accordance with Auditing Standard on Review
Engagements ASRE 2410 Review of a Financial Report Performed by the Independent
Auditor of the Entity, in order to state whether, on the basis of the procedures described,
we have become aware of any matter that makes us believe that the financial report is
not in accordance with the Corporations Act 2001 including: giving a true and fair view of
the Consolidated Entity’s financial position as at 31 December 2019 and its performance
for the half-year ended on that date; and complying with Accounting Standard AASB 134
Interim Financial Reporting and the Corporations Regulations 2001. As the auditor of the
Consolidated Entity, ASRE 2410 requires that we comply with the ethical requirements
relevant to the audit of the annual financial report.
A review of a half-year financial report consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an audit conducted in
accordance with Australian Auditing Standards and consequently does not enable us to
obtain assurance that we would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit opinion.
Independence
In conducting our review, we have complied with the independence requirements of the Corporations Act 2001.
Conclusion
Based on our review, which is not an audit, we have not become aware of any matter that makes us believe
that the half-year financial report of The Agency Group Australia Ltd and Controlled Entities is not in
accordance with the Corporations Act 2001 including:
a. Giving a true and fair view of the Consolidated Entity’s financial position as at 31 December 2019 and of
its performance for the half-year ended on that date; and
b. Complying with Accounting Standard AASB 134: Interim Financial Reporting and Corporations
Regulations 2001.
Material Uncertainty Related to Going Concern
We draw attention to Note 1(aii) in the financial report, which indicates that the Consolidated Entity incurred a
net loss after tax of $1,674,164 during the half year ended 31 December 2019. As stated in Note 1(aii), these
events or conditions, along with other matters as set forth in Note 1(aii), indicate that a material uncertainty
exists that may cast significant doubt on the Consolidated Entity’s ability to continue as a going concern. Our
conclusion is not modified in respect of this matter.
BENTLEYS DOUG BELL CA
Chartered Accountants Partner
Dated at Perth this 29th day of February 2020