Beston Global Food : Appendix 4D and Half-Year Financial Statements

For personal use only

Results for announcement to the market

We have provided this results announcement to the market in accordance with Australian Securities Exchange (ASX) Listing Rule 4.2A and Appendix 4D for the Consolidated Group ('Beston') comprising Beston Global Food Company Limited ('the Company') [ABN: 28 603 023 383] and its controlled entities ('the Group') for the half-year ended 31 December 2021 compared to the half-year ended

31 December 2020.

Consolidated results, commentary on results and outlook.

	31 December	31 December	Movement	Movement
	2021	2020	($'000)	%
	($0,000)	($0,000)
Revenue from ordinary activities	68,289	52,838	15,451	29.24%
Loss before tax attributable to equity holders	(11,866)	(12,517)	651	5.2%
Income tax (expense)/benefit	4,090	3,692	398	10.78%
Loss after tax attributable to equity holders	(7,776)	(8,825)	1,049	11.89%

The commentary on the consolidated results and outlook, including the change in state-of-affairs and likely developments of the Group, are set out in the Review of Operations section of the Financial Report.

Net tangible assets per share

	31 December	31 December
	2021	2020
	$ per share	$ per share
Net tangible assets per share	$ 0.071	$ 0.108

In accordance with Chapter 19 of the ASX Listing Rules, net tangible assets per share represents total assets, including right- of-use assets, less intangible assets, less liabilities ranking ahead of, or equally with, ordinary share capital and divided by the number of ordinary shares on issue at the end of the year. Net assets for the half-year ended 31 December 2021 are $68.6 million (half-year ended 31 December 2020: $75.9 million).

Distributions

There were no dividends paid, recommended, or declared during the current financial period.

Independent auditor's report

The Consolidated Interim Financial Report upon which this announcement of the results to the market is based have been reviewed and the Independent Auditor's Review Report to the members of Beston Global Food Company Limited is included in the attached Financial Report.

2 BESTON GLOBAL FOOD COMPANY LIMITED | FINANCIAL REPORT FOR THE HALF-YEAR ENDED 31 DECEMBER 2021

For personal use only

Financial report

for the half-year ended 31 December 2021

Review of operations	4
Directors' report	5
Auditor's independence declaration	6
Interim Financial Report	7
Consolidated statement of comprehensive income	8
Consolidated balance sheet	9
Consolidated statement of changes in equity	10
Consolidated statement of cash flows	11
Notes to the preliminary consolidated financial statements	12
Directors' declaration	23
Independent auditor's report	24

BESTON GLOBAL FOOD COMPANY LIMITED | FINANCIAL REPORT FOR THE HALF-YEAR ENDED 31 DECEMBER 2021

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4 BESTON GLOBAL FOOD COMPANY LIMITED | FINANCIAL REPORT FOR THE HALF-YEAR ENDED 31 DECEMBER 2021

Review of operations

	A review of the results of the operations of the consolidated
	entity during the half-year is as follows:
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	Summary of consolidated results	1H22	1H21	Variance
	Milk supply (million litres)	79.8	73.7	8.3%
	Production volumes (tonnes)
	Mozzarella	7,939	5,646	40.6%
	Whey powder	3,358	2,622	28.1%
	Lactoferrin	7,429	635	1,070.1%
	Sales volumes (tonnes)
	Mozzarella	7,677	5,401	42.1%
use	3,367	2,569	31.1%
	Whey powder
	Lactoferrin	2,255	592	281.2%
		$'000s	$'000s	Variance
	Product sales	68,289	52,838	29.2%
	Gross margin	4,375	611	616.0%
	Gross margin %	6.4%	1.2%	454.0%
	Loss before income tax	(11,866)	(12,517)	5.2%
	Income tax benefit	4,090	3,692	10.8%
	L ss for the period	(7,776)	(8,825)	11.9%
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Revenues of the consolidated entity increased 29.2% to $68.3 million for the half-year, including increased dairy export sales, which increased from 19.6% to 25.1% of total sales. Refer Note 2 to the consolidated financial statements for further detail.

Gross Margins increased compared to the comparative period, as a reflection of the improved production performance

in the dairy manufacturing facilities. Gross margins in the Meat business also improved during the period. Refer to the segment note in Note 1(c) of the consolidated financial statements for further detail.

ForDu ing the financial half-year period ended 31 December 2021, the consolidated statutory net loss attributable to the owners

f the Beston Global Food Company Ltd was $7.78 million, an improvement of $1.03 million against the comparative period.

The net cash outflow from operating activities of $16.2 million was largely due to the operating result as well as unfavourable working capital movements in trade debtors (corresponding to our higher levels of sales), and to a small inventory build-up. Net cash flows for the half-year were positive, with the cash on hand increasing over the period.

Equity attributable to the equity holders of Beston Global Food Company Limited as at 31 December was $69.4 million.

BESTON GLOBAL FOOD COMPANY LIMITED | FINANCIAL REPORT FOR THE HALF-YEAR ENDED 31 DECEMBER 2021

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Directors' report

The Directors present their report on the consolidated entity consisting of Beston Global Food Company Limited ('the Company') and the entities it controlled at the end of, or during, the half-year ended 31 December 2021. Throughout the report, the consolidated entity is referred to as the Group.

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Directors

The following persons were Directors of Beston Global Food Company Limited during the whole of the financial year and up to the date of this report unless otherwise stated:

• R N Sexton
• S Gerlach
• J Andrew
• N Longstaff
• C Hayman (appointed 25 August 2021)
• K Reid (appointed 19 January 2022)
• P Coventry (resigned 19 January 2022)
• I McPhee (resigned 19 January 2022)

Principal activities

During the year the principal continuing activities of the Group consisted of:

1. Production of dairy, meat, and water products for sale into local and international markets.
2. Development and production of health and well-being focused food, beverage and pharmaceutical products.
3. Development and commercialisation of end-to-end food traceability and anti-counterfeit technology.

Dividends - Beston Global Food Company Limited

There were no dividends provided for during the half-year ended 31 December 2021 (31 December 2020: nil).

Events since the end of the financial year

No matter or circumstance has occurred subsequent to the period end that has significantly affected, or may significantly affect, the operations of the Group, the results of those operations or the state of affairs of the Group or economic entity in subsequent financial periods.

Likely developments and expected results of operations

The are no substantial changes in the operating capability of the dairy or meat business planned for the second half of the year. The operating performance of the key production facilities has been and is expected to be in line with the Company's expectations. The results of operations for the second half of the year are largely dependent upon continuing good performance at the key production facilities, market prices for products sold, and the timing of sales of Lactoferrin.

Auditor's independence declaration

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 6.

Rounding of amounts

The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument 2016/191, issued by the Australian Securities and Investments Commission, relating to the 'rounding off' of amounts in the directors' report. Amounts in the directors' report have been rounded off in accordance with that Instrument to the nearest thousand dollars, or in certain cases, to the nearest dollar.

This report is made in accordance with a resolution of Directors.

For

Review of operations

Information on the operations and financial position of the Group and its business strategies and prospects is set out in the review of

operations on page 4.R N Sexton Chairman Adelaide

Significant changes in the state of affairs

There were no significant changes in the state of affairs of the consolidated entity during the year other than those outlined in the review of operations on page 4.