The directors present their report together with the condensed financial report of the consolidated entity consisting of Ava Risk Group Limited (the Company) and its controlled entities (the Group) for the half-year ended 31 December 2020 and independent review report thereon. This financial report has been prepared in accordance with AASB 134 Interim Financial Reporting.
The names of the directors in office at any time during or since the end of the half-year are:
|Name||Period of Directorship|
|D Cronin (Chairman)||Appointed 10 April 2018|
|M Stevens (Non-Executive Director)||Appointed 11 March 2015|
|M McGeever (Non-Executive Director)||Appointed 8 August 2018|
|R Broomfield (Executive Director)||Appointed 27 February 2008|
|S Basham (Executive Director)||Resigned 9 July 2020|
The directors have been in office since the start of the financial period to the date of this report unless otherwise stated.
Review of operations
- Revenue from ordinary activities of $35.159 million for the 6 months to 31 December 2020 (HY2021):
- 72% increase on HY2020 ($14.713 million) with revenues up by $9.243 million in the Services Division. Perimeter Security and Access Control contributed an additional $5.470m of sales revenue with strong revenues from the Indian Ministry of Defence Contract (MoD) and the Australian Department of Defence, despite Covid-19 delays to underlying sales;
- Licence fees from the Indian MOD project, have contributed $7.726 million of revenue and gross margin (HY2020: $1.343 million);
- 31 December 2020 sales orders backlog of $3.4 million (HY2020: $16.7 million), inclusive of the Indian MOD project.
Gross margin of 57% (HY2020: 49%) as a result of higher revenue margin in the International Valuable Logistics (Services) division and improved margins in the Technology division driven by favourable margin on the Indian MoD licence fee income.
Operating expenses excluding depreciation, amortisation and interest are $8.637 million (HY2020 $7.811 million).
- Net profit from ordinary activities up to $11.028 million (HY2020: $0.942 million) driven by:
- Increase of $4.020 million profit in Perimeter Security underpinned by the Indian MoD contract;
- Strong demand for International Valuable Logistics services in the first six months contributing to an increase of $3.320 million profit in the Services Division; and
- Access Control Solutions reporting a profit of $2.135 million as a result of 109% growth in revenue (HY2020: $0.611 million loss);
- The Board declared a Special dividend of $0.01 per share, paid on 23 October 2020.
- As at 31 December 2020, the balance sheet has net assets of $34.075 million (FY2020 $25.415 million) with no external debts or borrowings.
Events after the Balance sheet date
On 29 January 2021, the Group announced a Special dividend of $0.02 per share on ordinary shares. The dividend has a record date of 10 February 2021 and will be paid on 10 March 2021.
Other than the changes noted above there has been no matter or circumstance, which has arisen since 31 December 2020 that has significantly affected or may significantly affect:
- the operations subsequent to 31 December 2020, of the consolidated entity, or
- the results of those operations, or
- the state of affairs, subsequent to 31 December 2020, of the consolidated entity.
Rounding of amounts
In accordance with ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191, the amounts in the directors’ report and in the financial report have been rounded to the nearest one thousand dollars, or in certain cases, to the nearest dollar (where indicated).
Auditor’s independence declaration
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 in relation to the review for the half-year is provided with this report.
This report is made in accordance with a resolution of directors.
26 February 2021