RFG Annual Report 2007 - Retail Food Group

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06/07 Annual Report 2 Retail Food Group Annual Report Chairman’s Letter 3 Managing Director’s Report 4 Corporate Governance Statement 8 Directors’ Report 11 Auditor’s Independence Declaration 21 Independent Auditor’s Report 22 Directors’ Declaration 24 Income Statement 25 Balance Sheet 26 Statement of Changes in Equity 27 Cash Flow Statement 28 Notes to the Financial Statements 29 Additional Stock Exchange Information 74
Chairman’s letter Dear Shareholder, 3 On behalf of the Board of Directors, it is my pleasure to present you with Retail Food Group’s Annual Report for the fi nancial year ended 30 June 2007. I suggested in last year’s Annual Report that the 2006 fi nancial year was a watershed year for RFG. Not only had the Company successfully listed on the Australian Stock Exchange following an oversubscribed Initial Public Offer, but it had exceeded its prospectus forecasts for the 2006 fi nancial year. Whilst the foregoing highlights were indicative of a highly successful and groundbreaking year, subsequent events have proved my comments to have been premature. Indeed, 2007 has seen Retail Food Group truly establish itself as one of Australia’s pre-eminent retail food brand managers and franchisors. During the year, the Company attended the acquisition of Brumby’s Bakeries Holdings Limited following an off market bid that was unanimously supported by the former Board of Directors of that company. This acquisition brought a further 324 franchised stores into the RFG fold. It has also added another recognised and successful brand to the Company’s existing stable of high profi le franchise systems and delivered on the strategic growth initiatives espoused in the Company’s May 2006 Prospectus. The addition of Brumby’s brings with it a plethora of opportunities not only for RFG, but each of the stakeholders in all three of the Company’s franchise systems. 2007 has also seen the successful commissioning and commencement of operations of the Company’s Central Manufacturing Facility (CMF)— a dedicated facility established to manufacture and supply donut and bakery products to its franchisees. The Coffee Roasting Facility (CRF), established by way of a joint venture with a leading coffee blender and roaster, has also been commissioned. Following successful product trials, the CRF has now commenced roll out of RFG’s proprietary coffee blend to its franchisees. These facilities have provided an additional platform for further development of the Company’s existing businesses and build upon the Company’s robust fi nancial results. In that respect, I am excited to note that the Company has achieved a FY2007 net profi t after tax of $7.5 million—$1.6 million (or 26.7%) up on the previous corresponding period. This result included record new store growth of 37 outlets which surpassed the Company’s May 2006 Prospectus forecast by 10 outlets. Ultimately, RFG’s achievements bear testimony to the valued efforts of management, franchisees and staff and I thank them for the impressive results they have achieved. I would also like to thank you, as a valued shareholder of RFG, for your commitment to the Company. Lastly, it is my pleasure to note that on 7 September 2007 the Company announced that it had entered into a conditional Scrip & Cash Terms Agreement with the owners of the 346 store Michel’s Patisserie franchise system. The Company’s due diligence investigations have been satisfi ed and the Board remains confi dent that this transaction will be completed later in the year. The potential acquisition of Michel’s Patisserie, which would bring total store numbers under RFG’s stewardship to in excess of 1020 outlets, when coupled with the underlying strengths and robust results of the Company, bodes well for FY2008 and ensures RFG is well placed to deliver further rewards to its shareholders in the year ahead. Retail Food Group Annual Report John Cowley, AM CHAIRMAN
Page 1: Retail Food Group Limited ACN 106 8
Page 7 and 8: Managing Director’s Report The Co
Page 9 and 10: OUTLOOK The 2007 fi nancial year ha
Page 11 and 12: The role of the Board and delegatio
Page 13 and 14: Directors’ Report The directors o
Page 15 and 16: The Group also continued with its s
Page 17 and 18: 4. Coffee Roasting Facility (CRF) T
Page 19 and 20: Directors’ meetings The following
Page 21 and 22: The following table discloses the r
Page 23 and 24: Deloitte Touche Tohmatsu A.C.N. 74
Page 25 and 26: 23 Auditor’s Independence Declara
Page 27 and 28: Income statement for the financial
Page 29 and 30: Statement of changes in equity for
Page 31 and 32: Notes to the financial statements f
Page 33 and 34: The directors anticipate that the a
Page 35 and 36: On consolidation, the assets and li
Page 37 and 38: (p) Property, plant and equipment L
Page 39 and 40: 6. Revenue An analysis of the Group
Page 41 and 42: 9. Income taxes 39 Income tax recog
Page 43 and 44: 9. Income taxes (continued) Deferre
Page 45 and 46: 10. Trade and other receivables 43
Page 47 and 48: 13. Property, plant and equipment 4
Page 49 and 50: 14. Other intangible assets (contin
Page 51 and 52: 19. Other liabilities 49 2007 $’0
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23. Earnings per share 51 2007 Cent
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26. Contingent liabilities and cont
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28. Subsidiaries 55 Name of entity
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30. Discontinued operations Disposa
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31. Notes to the cash flow statemen
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32. Financial instruments (continue
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33. Share-based payments (continued
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34. Key management personnel compen
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35. Related party transactions (con
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37. Subsequent events (continued) F
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Twenty largest holders of quoted eq
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Retail Food Group Limited ACN 106 8
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