2012 06 29 Annual Report To Shareholders PDF

Annual Report
2012
ABN 92 009 657 489
CONTENTS
Global Operations ...................................... 2
Financial Highlights................................... 4
Year in Review ........................................... 6
Health and Safety ..................................... 8
Our People .................................................. 9
ALS Group ................................................. 10
ALS Minerals ...................................... 12
ALS Life Sciences .............................. 14
ALS Energy ......................................... 16
ALS Industrial .................................... 17
Campbell Chemicals ............................... 18
Reward Distribution ................................ 19
Directors .................................................... 20
Group Management ............................... 22
Corporate Governance Statement ........ 24
Corporate Social Responsibility ............. 28
Financial Report ....................................... 30
Shareholder Information ........................ 92
ASX Requirements .................................. 93
Ten Year Summary .................................. 94
Principal Ofces ....................................... 95
General Information ............................... 96
FINANCIAL CALENDAR
2011/2012
Record Date for Final Dividend 8 June 2012
Final Dividend Paid 2 July 2012
Annual General Meeting 31 July 2012
2012/2013
Half-Year End 30 September 2012
Half-Year Results and
Dividend Announced 23 November 2012
Record Date for Interim Dividend 5 December 2012
Interim Dividend Paid 18 December 2012
Note: Dates subject to alteration
Annual General Meeting
The 61st AGM of Campbell Brothers Limited will be held at 11.00am on 31 July 2012
at The Sebel & Citigate King George Square, Brisbane.
CAMPBELL BROTHERS LIMITED ANNUAL REPORT 2012 1
Campbell Brothers Limited
With global headquarters based in
Brisbane, we are one of the longest-
established companies listed on the
Australian Securities Exchange
(ASX code: CPB).
Our Company was founded in 1863 and
listed on the ASX in July 1952. We are a
Company with a multi-billion-dollar market
capitalisation.
We have more than 12,000 employees and
we operate from more than 300 sites in 55
countries on six continents.
We operate one of the worlds largest
analytical and testing services businesses
and our partnerships span major sectors
including mining, natural resources,
environmental, food, pharmaceutical,
industrial and inspection services.
Our Company is focused on driving growth
by continuing to successfully operate our
existing businesses while pursuing new
opportunities.
Our success has enabled us to achieve
excellent results for our shareholders and
we have an established trend of attractive
investor returns.
OUR VISION
Campbell Brothers is committed to
maintaining the strong and sustainable
growth strategies which have made us
a successful global Company. We will
maintain the rewarding partnerships we
share with our clients, business partners,
shareholders and communities and identify
and develop new opportunities.
OUR VALUES
Our Company upholds the values which
are the foundation of our proud tradition of
excellence.
Our people are dedicated to the values of
quality, integrity, reliability and innovation
which ensure we deliver the highest level
of customer service. We value efficiency,
safety and diversity in our workplaces.
We value the leadership and learning that
develops our people and our businesses.
Over the past 10 years,
an investment in the
Companys shares has
achieved an average annual
rate of return of 34.1 per
cent, outperforming the
benchmark S&P/ASX All
Ordinaries Accumulation
Indexs return of 7.1 per
cent over the same period
(assumes that all dividends
paid have been reinvested
in CPB shares).
In September 2011, the
Company was included in
the S&P/ASX 100 Index.
Campbell Brothers Limited is a world leading commercial services company with national and
international operations.
TOTAL SHAREHOLDER RETURN
79.1
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79.1
CPB v All Ords & ASX100
B
a
s
e

=

1
0
0
Total Shareholder Return CPB
All Ordinaries Accumulation Index
ASX 100 Accumulation Index
Operates from more than 300 sites in 55 countries on six continents
Global Operations
2 CAMPBELL BROTHERS LIMITED ANNUAL REPORT 2012
Employs over 12,000 staff worldwide
2011
2010
2009
2008
2000 4000 6000 8000 10000 12000
2012
6,854
6,277
7,570
8,936
12,101
Financial Highlights
as at 31 March
2012
($m)
2011
($m)
Revenue ($m) 1,405.6 1,108.3
Net Prot after tax ($m) 222.4 132.4
Share capital ($m) 610.4 610.4
Total equity ($m) 930.2 825.5
Earnings per share (attributable to members) (cents) 329.48 203.19
Dividends per share (cents) 225.0 140.0
Net tangible asset backing per share ($) 2.41 4.77
Gearing ratio (net debt/(net debt + total equity) ( %) 28.5 11.9
Interest cover (times) 21.0 19.1
0
50
100
150
200
250
TOTAL DIVIDENDS (CENTS) YEAR AT A GLANCE
0
600
800
1000
1200
1400
0
50
100
150
200
250
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100
150
200
250
300
350
SALES REVENUE ($m) NET PROFIT AFTER TAX ($m) EARNINGS PER SHARE (CENTS)
DIVIDENDS
The Company will pay a final, partly-franked (50%) dividend for 2012 of $1.30 per share
(2011: 75 cents) at the 30% tax rate (2011: 30%). The total dividend for the year will be
$2.25 (2011: $1.40).
2008 2009 2010 2011 2012
2008 2009 2010 2011 2012
2008 2008 2009 2009 2010 2010 2011 2011 2012 2012
Revenue UP 27% to
$1.406 billion
Consolidated net profit
UP 68% to $222.4 million
Earnings per share UP 62%
to 329.48 cents
Financial Highlights
Business Division
2012
($m)
2011
($m)
Change
%
ALS Minerals* 591.3 334.5 +76.8
ALS Life Sciences (formerly Environmental)** 360.7 308.3 +17.0
ALS Energy (formerly Coal) 87.8 73.0 +20.3
ALS Industrial (includes Tribology)*** 152.5 142.4 +7.1
Campbell Chemicals^ 90.1 130.3 -30.9
Reward Distribution 123.2 123.9 -0.6
Business Division
2012
($m)
2011
($m)
Change
%
ALS Minerals* 214.7 111.8 +92.0
ALS Life Sciences (formerly Environmental)** 78.1 66.2 +18.0
ALS Energy (formerly Coal) 23.7 17.2 +38.3
ALS Industrial (includes Tribology)*** 24.5 16.6 +47.2
Campbell Chemicals^ 8.1 7.4 +10.0
Reward Distribution 3.0 (1.5) n/a
REVENUE
Total revenue for the consolidated
Group was $1.406 billion for
2012, a 27% increase on the
$1.108 billion recorded in 2011.
The revenue generated by each
Business Division was as follows:
PROFIT
Consolidated net prot after tax,
attributable to equity holders of the
Company, was $222.4 million for
2012, an increase of 68% on the
$132.4 million achieved in 2011.
The prot contribution from
ordinary activities, before tax
and corporate overheads for each
Business Division was as follows:
* includes Stewart Group from July 2011
** includes Columbia Analytical Services from October 2011
*** includes Austpower Engineering from October 2011
^ sold the Cleantec business effective 1 December 2010
FINANCIAL RESULT
Net Prot after tax attributable to equity
holders of the Company was $222.4 million,
up 68% on the $132.4 million net prot
recorded last year, in line with guidance
given to the market in November 2011.
Revenue was $1.406 billion, a 27%
increase on the $1.108 billion generated
last year.
The translation of foreign earnings was
impacted by a stronger Australian dollar
during the year. The average exchange rate
against the US dollar was USD1.05 for the
March 2012 year (previous year: USD0.95).
SHAREHOLDER RETURNS
The Companys performance has
significantly increased shareholder returns
for the year. Earnings per share increased
62.1% to $3.29 per share (up from $2.03
per share last year).
The Company has also re-instated its
dividend reinvestment plan (DRP), to be
in operation for the FY2012 final dividend.
A 5.0% discount to market price will apply
for DRP shares issued in relation to the final
dividend.
Year in Review
The Company delivered another record financial result for the year ended 31 March 2012, driven
primarily from the high performing ALS Group businesses.
Directors have declared a final partly franked (50%) dividend
for the year of $1.30 per share (2011: 75 cents partly franked)
bringing the total partly franked (50%) dividend for the year to
$2.25 per share (2011: $1.40 partly franked).
DIVISIONAL REVENUE ($m)
DIVISIONAL PROFIT ($m)
591.3
214.7
152.5
24.4
360.7
78.1
87.8
23.7
Minerals
Life Sciences
Energy
Industrial
ALS GROUP
Year in Review
DIVISIONAL PERFORMANCE
All divisions within the ALS testing and
inspection services business recorded
increased profit contributions and margins
over the previous year. In particular, strong
growth in global mineral exploration
and resource development activity lifted
demand for the services provided by ALS
Minerals division. Increased sample flow,
from exploration activity saw sample
volumes increase by more than 40%
into ALS geochemical laboratories. ALS
metallurgical activities also saw strong
growth through the year, enhanced by
the inclusion of G&T Metallurgy in Canada,
acquired as part of the Stewart Group in
July 2011. Organic growth coupled with
acquisitions, served to deliver a 92%
increase in segment profit contribution
over the March 2011 year.
ALS Life Sciences division (formerly known
as ALS Environmental) delivered strong
gains in revenue and profit contribution,
particularly within the Australian and North
American regions. Revenue for the division
increased by 17 percent and segment
profit by 18 percent compared to the
previous year.
ALS Energy (formerly known as ALS Coal)
and ALS Industrial (incorporating ALS
Tribology) divisions all recorded solid
growth in earnings contribution compared
with the previous year. Both revenue and
operating margin improved significantly
through the year for both divisions.
Campbell Chemicals delivered an improved
profit result on lower revenue following the
sale of the Cleantac business in December
2010 and the Reward Distribution hospitality
supplies division returned to profitability
during the year.
STRATEGY
The Company continued its strategy of
business expansion and diversication in
testing and inspection services. Signicant
progress was made in further diversifying
the ALS Groups geographical revenue and
prot streams, with the acquisition of the
UK-based testing and inspection services
business Stewart Group in July 2011, for
$222 million, with operations throughout
North America, Africa, Asia and Europe.
Other notable acquisitions made during
2011/12 was Columbia Analytical Services,
an environmental and food analytical
group operating in the US, acquired in
October 2011 and Austpower Engineering,
an industrial inspection and engineering
business providing advanced inspection
services to the power generation industry
in Australia, also acquired in October 2011.
Although these and other acquisitions
have contributed greatly to the Groups
growth, an analysis of organic growth
versus acquired growth in the Group over
the year shows a very strong picture, with
most of the growth coming organically. This
highlights the strength of the ALS brand in
the market place.
OUTLOOK
It is expected that the acquisitions nalised
during the nancial year, along with the
recent acquisition of the Eclipse Scientic
Group on 4 April 2012, will contribute
strongly to the Companys result in the
2012/13 nancial year.
The Company expects to increase its
prominence as a leading global provider
of testing, inspection and certication
services, with further expansion and
enhancement of its businesses within the
ALS Minerals, Life Sciences, Energy and
Industrial divisions.
During the year, Campbell Brothers continued to focus on the implementation of the recently
revised Health Safety & Environment (HSE) Minimum Standard, rst developed in 2005.
Health and Safety
LIFE SAVING RULES
Campbell Brothers believes in the adage
Work safe, home safe and, as a result,
has targeted the workplace risks that pose
the most serious threats to our work force.
Life Saving Rules has been developed
to focus all group businesses on safety
practices that must be followed.
All businesses are expected to adopt
or modify the Life Saving Rules to the
particular risks which apply to their local
environment.
The implementation of Life Saving Rules
is monitored to ensure all businesses of
Campbell Brothers adopt these core safety
rules.
LOSS CONTROL MEASURES
In alignment with our commitment to the
protection of all people, property, assets
and environment, Campbell Brothers
has undertaken a global program which
looks at the adequacy of loss control
measures across all sites. The loss controls
focus on re and security management,
and set standards for all sites according
to their risk prole. Sites are expected
to have implemented re and security
management systems to ensure staff and
property are adequately protected, and to
revisit those processes on a regular basis.
During the year, as part of the minimum
standards, Campbell Brothers also focused
on environmental sustainability, facilitating
the dissemination of good environmental
practice globally.
PROACTIVE SAFETY
The company has adopted a more
proactive approach in the monitoring of
safety performance with the introduction
of positive performance indicators (PPI).
PPI measures process or proactive safety
activities, not merely incident rates.
PPI is designed to provide a balanced
approach to measure safety performance
and to drive positive safety behaviors.
PPI measures managers engagement
in safety in four key areas: leadership,
program compliance, training and injury
performance. Managers are measured
on their performance against nine
criteria and are held accountable for their
implementation at local levels.
The PPI scorecard has the ability to
provide a group-wide picture, as well as
by business unit and region. Businesses
can see how they are performing against
the PPI scorecard and, where necessary,
increase their attention on proactive safety
activities and risk management programs.
HEALTH AND SAFETY PERFORMANCE
The most commonly used method to
measure health and safety performance is
the Lost Time Injury Frequency Rate (LTIFR)
which measures the number of Lost Time
Injuries (LTIs)* per million hours of work
(reported as per Australian Standard 1885).
*LTI is a work injury that results in an inability to work for at
least one full day or shift any time after the day or shift in
which the injury occurred.
Campbell Brothers has set itself high
standards in relation to reducing harm to
workers and has seen signicant reductions
in lost time injury frequency rates over the
last decade. This year, the rate increased
slightly from 2.8 (2011) to 3.0.
Campbell Brothers has set a target of
reducing the LTIFR rate to at least 2.0 by
2013 and will be striving to return to the
declining LTIFR rate evidenced over the last
decade.
0
2
4
6
8
10
12
14
!
GROUP LTIFR (as at March 31)
2008 2007 2006 2009 2010 2011 2012
Ensuring that these
minimum standards evolve
and grow, encompassing
the protection of people,
property and the
environment in all global
operations is a priority
activity.
Our People
Staff numbers across the Group grew to a global total of over 12,000, a 25 % increase over 2011,
through organic growth and acquisitions.
A swathe of awards marked 2011 as
a source of pride to the group and
demonstrated our goals of excellence
and recognition.
HIGH ACHIEVEMENT
The year was characterised by high
achievement, with a number of our staff
and business units receiving key awards,
including:
John Folinsbee, ALS Metallurgy, Canada
Mineral Processor of the Year
Christobel Ferguson, ALS Water Sciences
Division, Melbourne
AWA Water Industry Woman of the Year
ALS Environmental, Australia
Care Award
ALS Environmental, Houston
Top Workplaces List
ALS Industrial, Melbourne
Esso Safety Award
CELEBRATING DIVERSITY
Campbell Brothers commitment to
Diversity, publicly expressed for the rst
time last year, is now fully embedded
in the companys culture and processes.
As an example, our staff prole statistics
demonstrate a pipeline of highly performing
women, all of whom will be encouraged to
grow and evolve with the business.
The Campbell Brothers Diversity Policy was
launched globally during the year.
During the year, a global diversity
survey was implemented to examine
workforce composition. As at 1 March
2012, women represented 38% of our
total workforce. Analysis shows that
24% of senior executives are women,
including our Deputy Chairman. 32% of
the companys managers are women and
43% of professional staff are women.
The data shows a strong pool of qualied
professionals and managers to draw from
as we work toward achieving a higher
percentage of female executive level staff.
To assist in accelerating the progress of our
female workforce, 29% of our Executive
Proling Campaign (EPC) program
participants are female.
No targets were set during this nancial
year. Targets and objectives will be
developed based on the survey results
carried out and will be reported in the next
nancial year.
In terms of ethnic diversity, the
comprehensive online Campbell Brothers
Global Induction, which is hosted on Pulse
(our online learning management system),
is now available in six languages.
Our company magazine - Globalscene - is
also produced in six languages.
One of the companys key commitments
during acquisitions is to roll out the Pulse
system to new team members as soon
as is appropriate. All new personnel may
accelerate their opportunities to learn and
grow from the outset of their employment
with us. These learning programs continue
to unite our global business and reinforce
our Core Values.
BUILDING CAPABILITY
The use of the Pulse learning management
system continued to grow globally during
the year. The system currently hosts over
368 online learning resources covering
a range of Technical, Core Skills, Health
Safety & Environment and Leadership
programs.
During the year, over 17,000 online courses
were completed by our Group employees.
Many courses are authored in-house, which
enables us to maintain our standardised
processes globally, in a cost efcient
manner. We also offer the acclaimed
Harvard Manage Mentor courses online in
English, French and Spanish.
LEADERSHIP APPROACH
The EPC is a global assessment,
development and capability planning
program that provides a rich vein of
talent for our executive team to tap for
appropriately qualied and motivated
people for start ups, promotions and to
augment leadership. The program also
aids cross-divisional cooperation, and cross
selling of products and services, and helps
to provide procedural synergies.
Learning is tailored to each region whilst
maintaining core competency elements.
It continues to help deliver successful
internal promotions, engagement and
retention of key talent.
PROCESS AUTOMATION
A new human resources and payroll
system was implemented across Campbell
Brothers during the year. The global
Short Term Incentive scheme has now
been automated as a part of this process
and is expected to deliver savings in
administration and processing time.
Further automation was completed with
improvements to the Campbell Brothers
SharePoint sites. New human resources,
people metrics reporting and updated
learning sites were all rolled out during
the year.
One of the key challenges
met during the year, was
to introduce such a diverse
group of new team members
to our culture, and to make
them welcome.
RECORD RESULTS
ALS has an enviable reputation for
delivering a quality service which includes
accurate and timely data, expert support
and a culture of safety and innovation.
ALS employs over 12,000 staff worldwide,
operating in more than 300 laboratories in
55 countries across Africa, Asia, Australia,
Europe, North America and South America.
ALS services specically support mining
and mineral exploration, commodity
certication, environmental monitoring,
equipment maintenance, food and
pharmaceutical quality assurance and
industrial operations.
To better facilitate the future
direction of the company, ALS
has restructured its current
divisions.
2012
$000
2011
$000
Increase
Revenue 1,192,379 858,153 38.9%
Segment contribution 340,938 211,759 61.0%
Margin (segment contribution to revenue) 28.6% 24.7%
The ALS Group (ALS) is one of the largest providers of analytical and testing services in the world.
It offers analytical and testing services across multiple market segments.
ALS Group
Minerals
Metallurgy
Inspection & Certication
Mine Site
Coal
Oil & Gas
Environmental
Food & Pharmaceutical
Industrial
Tribology (oil analysis)
Effective 1 April 2012, ALS ve divisions have been restructured into four divisions, which encompass
ten operating business streams.
ALS Group
Geochemistry
Coal
Asset Care
Envi ronmental
Food&
Pharmaceuti cal
Mi ne Si te I nspecti on Metallurgy
Oi l & Gas
Tribology
MARKET LEADER
During 2011, the division took another
signicant step in expanding its global
footprint in the testing and inspection
markets with the acquisition of the Stewart
Group, a global provider of geochemical,
metallurgical and inspection services.
The Stewart Group has a globally
recognised reputation of excellence
which has been built on over 40 years of
exceptional service in mineral markets.
The acquisition brings with it 900 staff and
expanded geographic reach throughout
Europe, West Africa and Asia, positioning
the Metallurgy group in North America, and
extending the resource sector offering to
include Inspection Services.
The diverse yet cohesive portfolio now
covers the resource cycle from exploration
through mining, processing and, nally,
shipment and sale.
PERFORMANCE AND DEVELOPMENTS
Geochemistry
Revenue increased 52%. EBIT increased
76%. Employee numbers have more than
doubled since December 2009. The largest
revenue gain was in Europe 153%, due in
part to the Stewart Group acquisition.
Capital expansion initiatives allowed for
completion of 16 major new or signicantly
expanded locations. These projects, as well
as additions of equipment in most locations,
provided a 50% total increase to system
capacity through the course of the year.
Excellent cost control disciplines are
entrenched in the Geochemistry business
and produced consistent returns at and
above target performance levels.
2012
$000
2011
$000
Increase
Revenue 591,338 334,477 76.8%
The ALS Minerals Division is
the market leading global
provider of geochemistry
and metallurgy services to
both the exploration and
mining sectors. The division
extended its offering to
include Inspection Services
via the acquisition of the
Stewart Group in July 2011.
OUTLOOK
Geochemistry
ALS capacity expansion during 2011 and
ongoing will drive performance above
industry growth projections.
We expect 20% revenue growth driven
by major mining company demand. One
of the ways we will do this, and aim for
sustainable growth, is to foster longer term
global partnering solutions.
Our continued commitment to additional
major capital expansion during the year
included key project development in
the Vancouver Analytical department
expansion, Loughrea (Ireland) re-location,
Lima expansion, Johannesburg relocation,
Ouagadougou and Mwanza (West Africa)
relocations.
In the future, costs are expected to
marginally increase due to tighter
labour markets, increases in consumable
expenses and to meet developing client
demand for a more diverse array of
associated services which meet non-core
work requirements.
All business arms of the ALS Minerals Division demonstrated protability and cost-containment.
Strategic expansion has improved the groups capacity, service offering and its market reach.
ALS Minerals Division
PERFORMANCE AND DEVELOPMENTS (cont)
Metallurgy
A new 900m2 metallurgy laboratory facility
was built and commissioned in Pooraka,
South Australia during 2012. This facility
replaced the existing laboratory (300m2)
in Bowden, SA. Other improvements in the
Metallurgy business included:
Substantial expansion of iron ore
facilities in Perth
Establishment of Heavy Liquid
Separation (HLS) business in Perth. The
majority of this work has come from the
iron ore section
New Hydrometallurgy pilot/
bench testing and ofce facilities
commissioned in Perth
Substantial increase in Perth assaying
laboratorys capacity via capital
investment and shift rostering
Enhancements to the storage invoicing
and logistics systems in Perth, offering
clients managed storage options
Relocation of the Perth Mineralogy
department to new larger laboratory
and ofces, allowing for future
expansion
Strong growth experienced by Canadian
business with the workforce increasing
from approximately 50 staff to 85.
Major expansion of Canadian operations
at Kamloops nearing completion. The
renovation will increase capacity by a
further 30%.
Inspection
The Divisions Inspection Group has
been protable since acquisition. UK and
South Africa continue to demonstrate
stable performances with positive signs
for 2012/13. Continental European
operations are currently under review and
consolidation.
The Inspection Group will fully re-brand into
ALS Inspection in the coming months. A
large and successful event was held during
the high prole London Metal Exchange
(LME) week in October to promote the ALS
acquisition.
The UK operation has been designated
as the technical and management hub
for the Inspection Group. The UK business
was restructured and its management
team strengthened, specically to focus
on creating a strong platform for growth
through delivery of premium technical
and customer services. Of particular note
is the formation of a standalone Precious
Metal unit to take advantage of buoyant
conditions and create focus.
Market conditions have been moderate
with tight spot markets across the majority
of commodities, the exceptions being
precious metals and selected base metals.
Demand out of China slowed during the
year with periods of material stockpiling
observed.
Strongest performances were seen in
developing regions of the world and in the
base/precious metal materials market,
contributing to the results achieved in
South Africa and UK.
Gold has performed very strongly and has
directly resulted in a noticeable increase in
related inspection and testing.
A further business arm, Mine Site Services, will be added during 2012/13.
ALS Minerals Division
13
OUTLOOK (cont)
Metallurgy
Strong growth in metallurgical test work is
expected during 2012/13. In Canada, we
anticipate growth from increased demand
for bench scale work, whilst large scale
pilot plants will be key in Australia.
An iron ore centre of excellence will be
established at a new site incorporating
metallurgy and geochemistry divisions.
We will also establish a new laboratory in
Santiago, Chile. Metallurgy, Geochemistry
and Environmental groups will be co-
located on the site.
The year will also see establishment of
a purpose-built offsite storage facility to
accommodate long-term managed secure
storage of client samples. This will release
approximately 7000m2 of space at the
current Perth facility which can then be
developed for testing capabilities.
Further expansion of the Adelaide site,
due to increased test work and storage
requirements, will also occur.
Inspection
Integration efforts will continue in the
new Inspection business, focusing on the
developing and growth economies of China
and South America.
The UK business will complete its
positioning as global technical and
administrative hub, rationalising
duplications in continental Europe.
South African operations will relocate
into a consolidated Minerals Division hub
located in Johannesburg.
The company has identied a priority
to enter the Chinese inspection market,
which will include establishment of a
laboratory, appropriate licensing and
establishment of a network of surveyors.
We are also scoping establishment of an
inspection network in Chile and Peru.
The ALS Life Sciences Division further consolidated its market leadership position during the year. Strong
revenue and EBIT growth across all regions has provided a robust platform for continued market share growth.
ALS Life Sciences Division
The Life Sciences Division is
one of the largest providers
of environmental analytical
services in the world with a
worldwide footprint of over
40 laboratories, ofces and
service centres.
Life Sciences
2012
$000
2011
$000
Increase
Revenue 360,661 308,281 17.0%
ENVIRONMENTAL SERVICES
The division provides a full range of
environmental analytical testing services,
specialising in the analysis of soil, sediment,
water (raw, waste, drinking, catchment,
recycled, saline, product), leachates, dust,
air (indoor, stack, ambient), gas and biota,
as well as specialty food and pharmaceutical
testing services, including raw material and
finished product chemical testing, stability
and shelf life trials, audits and inspection
services.
AUSTRALIAN ENVIRONMENTAL
In the year under review, the Australian
Environmental Division consolidated its
market leadership position, increasing
revenue by 14% and EBIT by 25%. All
regional operating units and eld service
operations (Monitoring & Technical
Services, and Water Sciences) exceeded
year end EBIT projections.
All businesses were particularly successful
in leveraging environmental monitoring
and analysis opportunities in the resource
sector (metalliferous, coal and gas), water
supply and re-use contracts, as well as
reconrming strong relationships in the
contaminated land sector via oil companies
and environmental consultancies.
A services ofce was established in Darwin
along with a testing laboratory in Roma,
specically to service the coal seam gas
sector. Refurbishment of the showcase
Sydney laboratory was completed,
increasing capacity by 50%, and work
is well progressed on building a new
environmental laboratory in Brisbane.
From 1 April 2012, the Environmental Division has been restructured as ALS Life Sciences, to better focus on
the various market sectors serviced by the division.
ALS Life Sciences Division
OUTLOOK
New facilities, an expanded footprint,
maintaining a focus on quality and service,
together with new innovative services
currently being developed will see further
growth in the division in the new year.
The acquisition of the Eclipse and AMS
businesses in the United Kingdom and
Ireland will act as a catalyst to rapidly
grow the companys presence in the food
and pharmaceutical sectors.
AUSTRALIAN FOOD/PHARMACEUTICAL
The acquisition of the EML Holdings Pty Ltd
laboratory in June 2011 placed the division
as a leader in the provision of Food Testing
Services in the Australian market.
The division was restructured post EML
acquisition, with all business units
performing protably. New laboratories
are under construction in Sydney and
Melbourne to consolidate operations.
ASIAN ENVIRONMENTAL
On a consolidated basis, the region nished
2011/12 in advance of EBIT projections, in
spite of a currency correction.
All business units, with the exception
of Hong Kong and Singapore, nished
in advance of EBIT projections in local
currency, with standout performances
from China, Thailand and Malaysia. The
Hong Kong business was restrained by
sharply declining government spending in
the sector, whilst macroeconomic factors
impacted the Singapore business.
An aggressive strategic plan was prepared,
targeting signicant growth through service
diversication (food consultancy, specialist
high level analysis), and a targeted
acquisition strategy.
NORTH AMERICAN ENVIRONMENTAL
In comparison to the previous year, the
North America Environmental Division
improved both revenue and EBIT gures.
While the year started with a fairly strong
rst quarter, a slow second quarter resulted
in the region heading into the third quarter
busy season slightly behind estimates. This
trend continued due to the poor economic
conditions in the USA.
Fortunately, the business in Canada
continued to perform very well for the
remainder of the scal year, especially in
British Columbia and Ontario.
The acquisition of Columbia Analytical
Services (USA) in October 2011, was
positive from both a revenue and market
positioning standpoint. Integration activities
are well advanced; however, the business is
yet to deliver on the projected EBIT.
EUROPEAN ENVIRONMENTAL
The Environmental Division in Europe ended
the year ahead of last year on both revenue
and EBIT measures.
The year started strongly, but a slow second
quater resulted in the region falling behind
estimates.
A strong second half recovered lost ground
especially in December and January. These
two months saw record-breaking warm
weather spells, allowing sampling to
continue in the Nordic regions.
Strong market conditions in Scandinavia
together with tight cost controls in the
Czech Republic contributed to a sound
outcome for the region.
RECORD RESULTS
Now part of ALS new global Energy
Division, Coal Services reports an excellent
year. The group was able to overcome the
impact of oods in Queensland and New
South Wales, the reduction in Australian
coal exports due to infrastructure damage,
the limitation on imports caused by
Japanese tsunami damage and a series of
industrial relations events affecting the coal
industries of Australia and South Africa.
All regions performed strongly and, in
aggregate, increased the gross operating
margin to 27% despite the need to write
off bad debts in South Africa.
INTERNATIONAL FACILITIES AND SYSTEMS
The Division relocated the Brisbane and
Emerald laboratories to state-of-the art
facilities, integrated the Anglo American
Central Laboratory in South Africa and the
Stewart Group Laboratory in Mongolia into
its operations, and set up a new laboratory
in Bowen to service the Abbott Point Port
and surrounding mines. The new Brisbane
laboratory is a showcase facility for the
company and is, proudly, the largest and
most modern equipped commercial coal
laboratory in the world.
A new Laboratory Information
Management System, Coal8, was
commissioned across Australian sites and
will provide improved data management,
efciency and scalability for the global
coal business as it continues its impressive
growth trajectory.
The Energy Division posted record results during the year under review, despite a set of particularly
challenging conditions both in Australia and overseas.
ALS Energy Division
Coal produced yet another
record result with a
year-on-year 20% increase
in revenue and a 38%
increase in EBIT contribution.
A commendable result
which far exceeded industry
growth rates.
Energy
2012
$000
2011
$000
Increase
Revenue 87,848 73,023 20.3%
OUTLOOK
Coal Services now forms part of
ALS new global Energy Division.
Services to the Oil and Gas sectors will
be progressively added to this Divisions
portfolio over the coming years. Both
sectors enjoy very positive forward growth
projections and will provide a platform for
substantial expansion of the ALS Groups
service offerings worldwide.
New Coal Services operations will
commence in Indonesia and Mozambique
early in the coming year, and further
opportunities in China and the USA are
under consideration.
PROVEN PERFORMANCE
ALS Industrial also works with customers
asset management strategies, providing
services to keep plant and equipment fully
maintained and operational.
During 2011/12, the Asset Care business
reported solid growth in revenue and
prot contribution, despite the divestment
of its asset management business in July
2011. Austpower Engineering, acquired
in October 2011, contributed strongly to
increased prot contribution and margin
improvement in the second half.
The business remains focused on providing
asset owners and operators with high
quality engineering-led reliability and
integrity services.
The Tribology business in all regions
delivered solid growth in revenue and
prot contribution, primarily the result of
growth of existing client relationships and
disciplined cost management.
During the year, we improved services and
facilities. 2011/12 highlights included:
Expansion of advanced inspection
capability to include tube testing,
phased array ultrasonics, corrosion
mapping, saturated low frequency eddy
current, long range ultrasonic testing
and acoustic emission testing
Growth of contracted asset integrity
services to the rapidly expanding coal
seam gas sector
Successful renewal of long-term
contracts with blue chip energy and
resources companies
Establishment of partnership
agreements with specialist inspection
technology providers
Rollout of a formal non-destructive testing
traineeship program and online courses.
The ALS Industrial Division (incorporating ALS Tribology) reported solid growth in revenue and EBIT
driven by provision of high quality services and cost containment.
The ALS Industrial Division
tests and inspects material
and products to prove they
comply with national and
international standards and
customer specications.
Industrial
2012
$000
2011
$000
Increase
Revenue 152,532 142,372 7.1%
ALS Industrial Division
OUTLOOK
The Industrial Divisions target sectors of Oil
& Gas, Mining, Minerals Processing, Power,
Transportation and Infrastructure are
expected to remain buoyant throughout
2012/13, driven by customers aging plant
and equipment, and strong production
targets.
Continued investment in reliability and
integrity engineering capability and
specialist inspection capability provide
opportunities for revenue and earnings
growth, while recruitment of experienced
engineers and technicians continues to be
a signicant challenge.
Key opportunities in 2012/13 include:
Renewal and expansion of strategic
long-term asset reliability and integrity
and oil analysis contracts
Development of a centralised work
management and reporting system for
the Asset Care business
Redesign and development of the
Tribology internal IT systems and client
data websites
Continued development of online
technical training courses.
2012
$000
2011
$000
Increase/
(Decrease)
Revenue 90,056 130,322 (30.9%)
DELTREX CHEMICALS
During the year under review, Deltrex
performed below expectations, largely due
to adverse economic conditions affecting
Australian-based manufacturing and
unfavourable weather conditions which
resulted in widespread ooding across
Queensland.
The years performance was further
hindered by the closure of several
multi-national manufacturing facilities in
Australia, citing the high cost of domestic
manufacture and Australian dollar
relativities as keys reasons for the decisions
taken. Agricultural markets also saw a drop
in chemical consumptions as vast tracts of
agriculture land spent key growing periods
covered by ood waters.
PANAMEX PACIFIC
2012 saw Panamex move well down
the path of executing its strategy for
greater geographic growth, while
also consolidating current category
opportunities in existing markets.
The stand out contributor for this nancial
year was Panamex Papua New Guinea
the business largest single market.
Panamex PNG was able to take full
advantage of local market conditions with
a tailored and targeted market offering.
Manufacturing and distribution activities
continued to be executed professionally,
despite the many challenges of the PNG
environment.
This operation continues to have several
key brands occupying the number one
position in PNG markets. The position of
product dominance is moving into other
markets in which Panamex operates.
Panamex has continued its focus on new
channel development throughout the year
with early successes in the new markets.
We anticipate these to be a reliable
foundation from which we can roll out
other aligned portfolio developments,
further enhancing the contribution new
markets make to Panamex sales and
positioning.
2011/12 was the rst full year of trading since divestment of Cleantec. As such, revenues show a
shortfall related to these sales moving out of the group.
Campbell Chemicals
The business remained
focussed and strategic to
ensure that both Deltrex
and Panamex were best
positioned for independent
growth.
OUTLOOK
Deltrex remains focused on being a
low cost and agile provider of chemical
products and services in its markets.
The business will remain focused on
developing and maintaining a portfolio
of products that ensures its status as the
partner of choice in its main markets and
will continue to be vigilant in investigating
and analysing opportunities in new and
emerging markets.
Panamexs business model continues to
prove its exibility and underpins the
business growth and success to date.
Growth is expected to continue as focus
is maintained on executing the strategic
growth plan while not losing sight of tight
controls over working capital exposures.
2012
$000
2011
$000
Increase/
(Decrease)
Revenue 123,174 123,869 (0.6%)
Segment contribution 3,664 (1,811) n/a
Margin (segment contribution to revenue) 3.0% (1.5%)
TURNAROUND YEAR
Changes which were implemented late
last year have resulted in a stronger, better
performing business unit which was able to
post a solid performance.
A number of changes are still to be fully
realised as the business is re-aligned to
a focus on key core products and target
markets.
The rebuilding of this division started
more than a year ago and the subsequent
stronger return on sales demonstrates
that the strategies put in place are already
achieving positive results.
BUSINESS IMPROVEMENTS
In a practical sense, key activities
throughout the year included:
Reduction of warehouses
(two closed in the last year)
Reduction of products and inventory
valuation
Increased focus on procurement
activities and an import program
Stronger relationships with key
suppliers
Stronger management teams
Successful rollout of The Hospitality
Stores
Divestment of the underperforming
New Zealand businesses
Productivity improvements in all
departments.
After strong rst half sales growth in our
project division, second half results were
hampered by low business condence,
especially in the third quarter. This was due
mainly to a hold on marketplace capital
expenditure.
The slowdown in local tourism and tight
discretionary spend factors affected our
ability to realise a traditionally strong
Christmas/New Year selling period.
Excluding the discontinued New Zealand
operations, revenue in Australia was up
3.8% on the previous year.
Overall, we ended the year with a small
decrease in revenue, but a signicantly
improved prot result on the back of
cost-cutting measures, productivity
improvements, more focussed selling
activities and re-adjusted procurement
strategies.
During 2011/12, the Reward Distribution Division undertook a complete business re-positioning, enabling
a number of key initiatives which turned the business around from a loss-making year in 2010/11.
Reward Distribution has been
trading for over 44 years
and is Australias largest
distributor of non food
consumables to a range of
industries such as hospitality,
health and aged care,
education, catering, mining
and contract cleaning.
Reward Distribution
OUTLOOK
Reward Distribution will continue to build
on this new foundation in the year ahead.
Our clear objective is to drive higher sales
growth, leading to sustained higher prots.
The tight market for capital expenditure on
projects is improving and general market
sentiment is trending up.
Our Projects Division will focus on two
key areas: Mining & Construction, and
Hospitality & Catering. This attention will
allow us to tap into the expansive array of
projects now being realised, such as
a number of new mining camp t outs
currently underway.
Tremendous opportunities are opening up
in segments where Reward Distribution
has previously not been strong. Now that
we have a coordinated, more targeted
approach to market needs, we can
utilise our purchasing, house brands and
distribution strength to improve our market
share right across Australia.
Further improved sales will result from the
marketing and rollout of The Hospitality
Store network. This high prole presence
has attracted strong support from both
account customers and the general
public, offering a wide range of retail and
commercial hospitality, catering, packaging
and cleaning products in a cash-and-carry
environment.
Board of Directors
GEOFF MCGRATH MIIE.
Chairman and Independent Non-Executive Director Age 69
Mr McGrath became a director of Campbell Brothers in 2003 and was appointed chairman
effective 1 August 2004. He retired from GWA Group Limited in May 2003 after 43 years
service, including the last 10 years as Managing Director. He is Chairman of GWA Group
Limited appointed effective 1 July 2010 (has been a non-executive director since July 2004).
He was previously a director of Fletcher Building Limited (July 2003 June 2009). He was
Chairman of the Remuneration Committee and a member of the Audit and Compliance
Committee intil 1 April 2012.
GREG KILMISTER B Sc (HONS), FRACI, MAIG, CCEO
Managing Director and Chief Executive Ofcer Age 56
Mr Kilmister was appointed Managing Director and Chief Executive Ofcer of Campbell
Brothers effective 1 September 2005. He joined the Company in 1981 and was the General
Manager of the Companys highly successful ALS Laboratory Services Group from 1992
through to 2005.
NEROLIE WITHNALL BA, LLB, FAICD
Deputy Chairman and Independent Non-Executive Director Age 68
Mrs Withnall was appointed a director of Campbell Brothers in 1994. She is a director
of PanAust Limited (appointed May 1996), Alchemia Limited (appointed Oct 2003) and
Computershare Limited (appointed July 2008). She was previously a director of Redcape
Property Fund Limited (formerly Hedley Leisure and Gaming Property Partners Limited
(June 2007 - November 2010), QM Technologies Limited (Sept 2003 April 2008) and
the Major Sports Facilities Authority. She is a former member of the Takeovers Panel, the
Corporations and Markets Advisory Committee, the Senate of the University of Queensland
and the Council of the Australian National Maritime Museum. She is a former partner of
Minter Ellison Lawyers. She is Chairman of the Audit and Compliance Committee and was
appointed Chairman of the Remuneration Committee effective 1 April 2012.
RAY HILL FAICD
Independent Non-Executive Director Age 70
Mr Hill was appointed a director of Campbell Brothers in 2003. He retired in July 2002
after a career spanning thirty years with Queensland dairy company Parmalat Australia Ltd
(formerly Pauls Limited) including the last 8 years as Group General Manager/Managing
Director. He is a non-executive director of Parmalat Australia Ltd (unlisted public company).
He is a member of the Audit and Compliance Committee.
Board of Directors
BRUCE BROWN B COM, AAUQ, FAICD
Mr Brown was appointed a non-executive director of Campbell Brothers effective 1 October
2005. He retired as Managing Director and Chief Executive of the Company on 31 August
2005 after 30 years service. He is a director of Transpacic Industries Group Ltd (appointed
March 2005) and RedFlow Limited (appointed March 2012) . He is a member of the
Remuneration Committee.
MEL BRIDGES B App Sc, Ph D, FAICD
Dr Bridges was appointed a director of Campbell Brothers in 2009. He has over 30 years
experience in the biotechnology and healthcare industries. During this period, Mel founded
and managed successful diagnostics, biotechnology and medical device businesses. He is
currently Chairman of Leaf Energy Limited (appointed director in August 2010), Alchemia
Limited (appointed director in September 2003) and Genetic Technology Group Limited
(appointed director in January 2012). He is a non-executive director of ImpediMed Limited
(appointed director in September 1999), Benitec Limited (appointed October 2007), and
Tissue Therapies Limited (appointed March 2009). He was previously Chairman of Incitive
Limited (November 2007 June 2010) and a non-executive director of Genera Biosystems
Limited (December 2008 November 2010). He was appointed as a member of the Audit
and Compliance Committee effective 1 April 2012.
GRANT MURDOCH M COM (HONS), FAICD, FCA
Mr Murdoch was appointed a non-executive director of Campbell Brothers on 1 September
2011. He was formerly a Partner of Ernst & Young and Divisional Director of Ernst & Young
Transaction Advisory Services Limited in Queensland. He is a director of Queensland
Investment Corporation (QIC) and UQ Holdings Ltd. He is Chairman of the Endeavour
Foundation and a senator of the University of Queensland, and an Adjunct Professor at
the University of Queensland Business School. He has more than 37 years of chartered
accountancy experience, specialising in mergers, acquisitions, takeovers, corporate
restructures and share issues. He is a member of the Audit and Compliance Committee.
JOHN MULCAHY Ph D, BE (CIVIL ENG) (HONS), FIE AUST
Mr Mulcahy was appointed a non-executive director of Campbell Brothers on 1 February
2012. He is Chairman of Coffey International Limited, a non-executive Director of GWA
Group Limited and Mirvac Group Limited, and a Guardian of the Future Fund of Australia. He
is a former Managing Director and Chief Executive Ofcer of Suncorp-Metway Limited. Prior
to Suncorp, John held a number of senior executive roles at the Commonwealth Bank and
Lend Lease Corporation. He was appointed as a member of the Remuneration Committee
effective 1 April 2012.
Group Management
RICHARD STEPHENS B COM, CA
Chief Financial Ofcer
Richard is responsible for the overall
nancial management of the Campbell
Brothers Group, including treasury and
taxation.
TIM MULLEN B Bus (Accounting), M Com Law, FCPA,
FCIS, FCLA
Group Company Secretary
Tim is responsible for corporate
governance of the Campbell Brothers
Group, incorporating company secretarial,
legal management and investor relations.
MICHAEL BURCHAM B Sc, Grad Dip Env Qual, Grad
Cert Risk Management, Grad Dip AppCorpGov, MRACI, ACIS
Group Compliance and Risk Manager
Michael is responsible for the overall risk
management of the Campbell Brothers
Group, encompassing the development
and implementation of a global corporate
compliance program to meet relevant
legislation, industry standards and codes
of practice.
SUSAN PUTTERS B Bus (Strategic Human Resources
Management), MBA (Occupational Health & Safety), GAICD
Group Organisational Development Manager
Susan was appointed Group Organisational
Development Manager in January 2008.
Susan is responsible for workforce
planning, human resources and
remuneration strategy for the Campbell
Brothers Group. Key areas of focus include
merger integration, process automation,
organisational development, acceleration
of talent and culture perpetuation.
MIKE MUNRO AISA, ISACA
Group Chief Information Ofcer
Mike is responsible for the global IT
network, IT security and infrastructure
operations of the Campbell Brothers Group.
He has been with Campbell Brothers since
2008 and has 29 years experience in IT.
BRIAN WILLIAMS B Sc (Aust Environmental
Studies), Grad Dip Mgmt (Gen Mgmt), RACI
Group General Manager,
Minerals Division
Brian was appointed Group General
Manager of the Minerals Division effective
1 April 2012, and is responsible for the
strategic management and development
of the global ALS Minerals Division. He was
previously the Group General Manager,
Environmental (Australia and Asia) and
Industrial Divisions.
BRUCE MCDONALD MBA (Hons), M Sc (Geology),
B Sc (Hons) (Geology)
Vice President, Geochemistry Services,
Minerals Division
Bruce was appointed Vice President,
Geochemistry, Minerals Division, effective
1 April 2012, and is responsible for the
strategic management of the Minerals
Divisions Geochemical business. He was
previously Group Executive Vice President,
Minerals Division, responsible for the
strategic management of the global
ALS Group mineral operations, based in
Vancouver.
RON GROGAN B AppSc. (Metallurgy)
General Manager, Metallurgy Services,
Minerals Division
Ron was appointed General Manager,
Metallergy Services, Minerals Division
effective 1 April 2012. He was previously
Chief Executive of the Metallurgy Division
following the acquisition by ALS of
Ammtec Ltd in November 2010.
CHRIS WALKER BA (Hons) (Geography)
General Manager, Inspection Services,
Minerals Division
Chris was appointed General Manager,
Inspection Services, Minerals Division
effective 1 April 2012. He was previously
Group Commercial Director with Stewart
Group prior to its acquisition by ALS in
July 2011.
RAJ NARAN B Sc (Chemistry), B A (Mathematics)
Executive General Manager,
Life Sciences Division
Raj was appointed Executive General
Manager of the Life Sciences Division
effective 1 April 2012, and is responsible for
the strategic management of the global Life
Sciences Division. He was previously Vice
President, Environmental Division (North
America & Europe). Raj was owner of e-Lab
Analytical, Inc. group headquartered in
Houston, Texas, which was acquired by ALS
in October 2007.
PAUL MCPHEE B Economics, AIMM
Group General Manager, Energy Division
Paul is responsible for the strategic
management of ALS global Energy Division
(formerly Coal Division). He has over 20 years
of coal and industry-related experience. Paul
was CEO of ACIRL prior to ALS acquisition of
the company in October 2007.
KRISTEN WALSH MBA, B Sc (Hons)
(Civil and Environmental Engineering)
Industrial Division
Kristen was appointed Group General
Manager of the Industrial Division
(incorporating ALS Tribology) effective
1 April 2012. She was previously General
Manager of the Industrial Division,
appointed following the acquisition of
PearlStreet Limited by ALS in January 2010.
Campbell Brothers ALS Group ALS Group
Group Management
GREG AFFLECK B Bus (Accounting), CPA
Financial Controller, ALS Group
Greg is responsible for the nancial
management of ALSs global operations.
He has extensive nance experience
gained from more than twenty years
employment with the ALS Group.
BRENDA CAUGHLIN Ph D
Vice President, Technology, ALS Global
Brenda is responsible for technical
development and oversight of the ALS
Minerals group and Laboratory Information
Management Systems for the global ALS
group. She has a specialization in analytical
spectroscopy and was instrumental in
developing ICP services for the group and
more recently, the integrated Laboratory
Information Management System
(GEMS) and client interface, Webtrieve,
for the Minerals Division. Brenda has an
international reputation as a geochemical
expert, with over twenty ve years
experience in the industry.
DAVID BROWN B Bus (Accountancy)
Campbell Chemical
David is responsible for overall management
of the Groups chemical businesses. He
has been with Campbell Brothers for
eleven years. He has extensive commercial
management experience, previously
employed in the plastic packaging industry
for 15 years.
ANDREW ROSS B Bus (Marketing),GAICD
Reward Distribution
Andrew was appointed Group General
Manager of Reward Distribution in
August 2010. He is responsible for overall
management, strategy and development
of the Groups hospitality, cleaning and
catering supply business, headquartered
at Yatala, Queensland. Andrew has had
considerable experience in management
roles with leading FMCG and service-based
companies, especially in running national
networks across multi-site operations.
ALS Group Campbell Chemicals Reward Distribution
Corporate Governance Statement
This statement and information identied
therein are available on the Companys
website at www.campbell.com.au under
the Corporate Governance section
PRINCIPLE 1: BOARD AND MANAGEMENT
A summary of the Companys board charter
is posted on the Companys website
which sets out the role, powers and
responsibilities of the Board.
PRINCIPLE 2: BOARD STRUCTURE
During the nancial year the Board
comprised seven independent non-
executive directors (including the
Chairman) and one executive director
(the Managing Director). Martin Kriewaldt
retired from the Board following the close
of the AGM on 26 July 2011. Two new
non-executive director appointments were
made during the year; Grant Murdoch was
appointed effective 1 September 2011
and John Mulcahy was appointed effective
1 February 2012. Both will be seeking
election by shareholders at the 2012 AGM.
Geoff McGrath, current Chairman of the
Board, will be retiring at the close of the
2012 AGM to be held 31 July 2012, with
current Deputy Chairman Nerolie Withnall,
to take over as Chairman.
The names, skills and experience of the
directors in ofce at the date of this
Statement, and the period of ofce of each
director, are set out in the Directors Report
and in the Annual Report.
Independent professional advice
Each director has the right, at the
Companys expense, to seek independent
professional advice in relation to the
execution of Board responsibilities. Prior
approval of the Chairman, which will not
be unreasonably withheld, is required.
Where appropriate, directors share such
advice with the other directors.
Independence of directors
The Board considers that all directors, other
than the Managing Director, Greg Kilmister,
to be independent of management
inuence. The Board distinguishes between
the concept of independence, and the
issues of conict of interest or material
personal interests which may arise from
time to time. Wherever there is an actual
or potential conict of interest or material
personal interest, the Boards policies and
procedures ensure that:
the interest is fully disclosed and the
disclosure is recorded in the register
of directors interests and in the Board
minutes;
the relevant director is excluded from
all considerations of the matter by the
Board; and
the relevant director does not receive
any segment of the Board papers or
other documents in which there is any
reference to the matter.
The chairman of the Company is an
independent non-executive director.
The roles of chairman and chief executive
are exercised by separate individuals.
Nomination Committee
The full Board is the Nomination
Committee and regularly reviews
Board membership. This includes an
assessment of the necessary and desirable
competencies of Board members, Board
succession plans and an evaluation of the
Boards performance, and consideration of
appointments and removals.
When a Board vacancy occurs, the
Nomination Committee identies the
particular skills, diversity, experience
and expertise that will best complement
Board effectiveness, and then undertakes
a process to identify candidates who can
meet those criteria. The Committee held
two meetings during the nancial year
as part of their regular Board meetings.
During the year, Grant Murdoch and John
Mulcahy were invited to join the Board as
independent non-executive directors.
Directors are not appointed for specic
terms and are subject to rotational
requirements for re-election. Criterion for
continued ofce is effective contribution,
which is regularly reviewed in the
processes referred to above.
A summary of the role, rights and
responsibilities of the Nomination
Committee, as well as the committees
policy for appointment of directors, is
available on the Companys website.
Board performance
The Board undertakes an annual review
of its performance together with an
assessment of the Groups executive
management.
The Board provides an appropriate
induction program for new directors,
permits directors to obtain independent
professional advice, have access to
the Company Secretary, decide on the
appointment and removal of the Company
Secretary, and has procedures for the
provision of information, including requests
for additional information. The Company
Secretary attends all Board meetings.
Induction and training programs for key
executives are designed and implemented
under the supervision of the Managing
Director.
PRINCIPLE 3: ETHICAL STANDARDS
Code of Conduct
Through established practices and policies
the Board supports the need for directors
and employees to observe the highest
standards of behaviour and business ethics.
All directors, managers and employees are
expected to act with integrity, striving at
all times to enhance the reputation and
performance of the Group. The Boards
policies exceed all the ASX guidelines.
Appropriate training programs on the
Groups internal policies including
workplace health and safety,
environmental law compliance, trade
practices legislation and afrmative action
programs support this process.
The policies and practices
developed and implemented
by the Board over many
years meet or exceed
the Principles and
Recommendations set out in
ASXs 2nd Edition Corporate
Governance Council
guidelines (ASX guidelines)
which were amended in June
2010 and became effective
from 1 January 2011.
For The Year Ended 31 March 2012
PRINCIPLE 3: ETHICAL STANDARDS continued
Code of Conduct continued
The Board recognises that managing
natural, human, social and other forms of
capital may also assist in creating value for
shareholders. To this end the Board seeks,
by the individual contributions of directors
and by encouraging activities of its
executives, to uphold community standards
and to maintain good relations with
community and government organisations.
However, the Board seeks to balance these
considerations in order to ensure that
the claims of legitimate stakeholders do
not prejudice or diminish the legitimate
expectations of shareholders. The Board
does not support a process by which
companies are regulated in their dealings
in these areas, beyond the consideration of
their programs to ensure compliance with
legal and ethical standards.
A Code of Conduct which draws together
all of the Companys policies and codes
was updated during the year to incorporate
matters under the UK Bribery Act as well
as requirements under the international
certication code and is available on the
Companys website.
Trading in company securities by
directors, ofcers and employees
The Board has established written
guidelines, set out in its Securities Trading
Policy, that restrict dealings by directors
and relevant employees in the Companys
shares, and in shares in other companies
related to the Companys operations.
The Securities Trading Policy identies
certain periods when, in the absence of
knowledge of unpublished price-sensitive
information, directors and relevant
employees may buy or sell shares in the
Company. These periods include the four
weeks following the announcement of half
year and full year results and following the
Annual General Meeting.
All Company personnel are bound by a duty
of condentiality in relation to information
obtained in the course of their duties.
Company personnel must not trade in
securities of other companies if they
possess unpublished price-sensitive
information in relation to that other
company.
The policy was updated in November
2011 and posted on ASXs Announcements
platform as provided by ASXs Listing Rules.
The policy aligns with requirements under
ASXs Listing Rules, including provisions
relating to prohibiting trading by directors
and senior executives in the Companys
securities during blackout periods, hedging
arrangements in relation to any unvested
securities of the Company and the
requirement to disclose to the Board any
securities in the Company that are held as
security in a margin loan arrangement.
The updated Securities Trading Policy is
published on the Companys website.
Diversity
The Company recognises that a diverse and
inclusive workforce is not only good for our
employees, it is also good for our business.
The Company has established a Diversity
Policy that has been reviewed and
approved by the Board which contains
measurable objectives for key diversity
categories, and is published on the Groups
website.
The Companys Diversity Policy is based
on the following key principles, reective
of the Revised ASX Corporate Governance
Principles and Recommendations on
diversity issued in June 2010:
1. Treat others with respect, value
differences and maintain privacy;
2. Value diversity and it will bring
opportunities to enhance our
businesses;
3. Women and minority cultural groups
will not be disadvantaged in gaining
employment and accessing the benets
and privileges that other persons in the
company enjoy in their employment
with the Company;
4. Transparency will be exercised in all
recruitment decisions from Board level
to entry level;
5. Workforce composition statistics will be
reviewed annually to determine if there
are any areas that warrant an increased
focus on diversity; and
6. Public reporting of progress against the
Companys diversity objectives.
A summary of the matters required to be
reported each year is contained in the Our
People section of the Annual Report.
PRINCIPLE 4: FINANCIAL REPORTING
Certication of nancial reports
The Managing Director and Chief Financial
Ofcer state in writing to the Board each
reporting period that the Companys
nancial reports present a true and
fair view, in all material respects, of
the Companys nancial condition and
operational results and are in accordance
with relevant accounting standards. The
statements from the Managing Director and
Chief Financial Ofcer are based on a formal
sign off framework established throughout
the Company and reviewed by the Audit
and Compliance Committee as part of the
six-monthly nancial reporting process.
Audit and Compliance Committee
The Company has an established Audit and
Compliance Committee operating under
written terms of reference approved by the
Board which are reviewed annually.
The Audit and Compliance Committee
comprises four independent non-executive
directors with an independent chairman
who is not also chairman of the Board.
During the nancial year, Grant Murdoch
was appointed to the Committee as
replacement for Martin Kriewaldt who
retired from the Board on 26 July 2011
following the 2011 AGM. The names and
qualications of members of the Audit
and Compliance Committee are set out in
the Directors Report and in the Annual
Report. Other non-executive directors of
the Board are entitled to be present at all
meetings of the Committee. Meetings of
the Committee are attended, by invitation,
by the Managing Director, the Chief
Financial Ofcer, the Group Compliance &
Risk Manager, the engagement partner
from the Companys external auditor and
such other senior staff or professional
people as may be appropriate from time
to time. The number of meetings of the
Committee held during the year is set out
in the Directors Report.
Minutes of all Committee meetings are
provided to the Board and the Chairman of
the Committee also reports to the Board
after each Committee meeting.
PRINCIPLE 4: FINANCIAL REPORTING
continued
Auditor independence
The external auditor, KPMG, has declared
its independence to the Board through
its representations to the Committee
and provision of its Lead Auditors
Independence Declaration to the
Board, stating that there have been no
contraventions of auditor independence
requirements as set out in the Corporations
Act or any auditors professional code.
The Audit partner was rotated as from the
audit period commencing 1 April 2008.
The Audit and Compliance Committee has
examined detailed material provided by
the external auditor and by management
and has satised itself that the standards
for auditor independence and associated
issues are fully complied with.
The Audit and Compliance Committees
terms of reference were reviewed
during the year and re-afrmed by the
Board. They are available, along with
other information suggested in the ASX
guidelines, on the Companys website.
PRINCIPLE 5: MATERIAL DISCLOSURE
The Company has established policies and
procedures for timely disclosure of material
information concerning the Company. This
includes internal reporting procedures in
place to ensure that any material price
sensitive information is reported to the
Company Secretary in a timely manner.
These policies and procedures are regularly
reviewed to ensure that the Company
complies with its obligations at law and
under the ASX Listing Rules.
The Company Secretary is responsible
for communications with the Australian
Securities Exchange (ASX) including
responsibility for ensuring compliance with
the continuous disclosure requirements
in the ASX Listing Rules and overseeing
information going to the ASX, shareholders
and other interested parties. The matter of
continuous disclosure is a permanent item
on the agenda for all Board meetings and
is specically addressed by each director at
those meetings.
The directors have obligations under a
Disclosure of Interests and Transactions in
Securities Agreement entered into with the
Company to inform the Company of any
securities trading in the Company.
The directors have made disclosure that
they have no material margin lending
terms in relation to their holding of
Company securities.
Announcements made to the ASX by the
Company are published on the Companys
website.
The Company re-afrmed its Continuous
Disclosure policy during the year. A copy of
the policy is published on the Companys
website.
PRINCIPLE 6: SHAREHOLDER
COMMUNICATION
Communications strategy
The Company aims to keep shareholders
informed of the Companys performance
and all major developments in an ongoing
manner. Information is communicated to
shareholders through:
the annual report which is published on
the Companys website and distributed
to shareholders where specically
requested;
the half-year shareholders report
which is published on the Companys
website and distributed to shareholders
where specically requested, containing
summarised nancial information and
a review of the operations during the
period since the annual report; and
other correspondence regarding matters
impacting on shareholders as required.
All material documents that are released
publicly are made available on the
Companys web site.
Shareholders are also encouraged to
participate in the Annual General Meeting
to ensure a high level of accountability
and identication with the Companys
strategies and goals. Important issues are
presented to shareholders as separate
resolutions.
Availability of auditor at AGM
The senior engagement partner (or his
representative) of the Companys external
auditor, KPMG, attends the Companys
annual general meetings and is available
to answer questions from shareholders
about the audit. The Chairman advises the
shareholders of this at the commencement
of each annual general meeting.
PRINCIPLE 7: RISK MANAGEMENT
Oversight of the risk management
function
The Company places a high priority on risk
management and identication throughout
the Groups operations and regularly
reviews its adequacy in this regard.
Under the guidance of the Audit and
Compliance Committee, a comprehensive
risk control program has been developed
which includes legislative compliance,
property protection and health, safety and
environment audits using risk assessors,
self audits, engineering and professional
advisers.
The Company has a qualied Compliance
and Risk Manager who oversees the
design and implementation of the risk
control program, monitors performance
and develops appropriate programs to
enhance awareness and compliance. These
programs include training for employees,
using both internal and external experts.
Regular review meetings are held with
divisional general managers and senior
personnel to provide guidance and
strategies for implementation of risk
mitigation measures in their businesses.
In September 2011, the Audit &
Compliance Committee reviewed and
the Board adopted the Risk Management
Program presented by the Group
Compliance and Risk Manager, which
outlined the Groups overall risk prole and
the Groups management of its material
business risks.
The Group Compliance and Risk Manager
reports in writing to the Board each month
and personally to meetings of the Audit
and Compliance Committee and supervises
not only the six-monthly sign off process
but also the follow up of any non-
compliances or identied areas requiring
further training or risk management.
PRINCIPLE 7: RISK MANAGEMENT continued
Internal nancial controls
The Company has an established internal
audit function under the control of the
Group Compliance and Risk Manager.
Internal audits are carried out in regular
consultation with the external auditors but
are independent of them.
The Chief Financial Ofcer reports in
writing and personally to each Board
meeting, attends all meetings of the Audit
and Compliance Committee and provides a
written report to that Committee.
Certication of risk management
controls
In conjunction with the certication of
nancial reports under Principle 4, the
Managing Director and Chief Financial
Ofcer state in writing to the Board each
reporting period that:
the statement is founded on a sound
system of risk management and
internal compliance and control which
implements the policies adopted by the
Board.
the Companys risk management and
internal compliance and control system
is operating efciently and effectively
in all material respects.
The statement from the Managing Director
and Chief Financial Ofcer is based on a
formal sign off framework established
throughout the Company and reviewed by
the Audit and Compliance Committee as
part of the six-monthly nancial reporting
process.
The Companys Risk Management Policy
and internal compliance and control
system were reviewed and re-afrmed
during the year and are available on the
Companys website.
PRINCIPLE 8: REMUNERATION
The Remuneration Committee of the Board
of Directors is responsible for reviewing
and recommending compensation
arrangements for the directors, the
chief executive ofcer and the senior
management team. The Remuneration
Committee assesses the appropriateness
of the nature and amount of remuneration
of such ofcers on a periodic basis by
reference to relevant employment market
conditions with the overall objective of
ensuring maximum stakeholder benet
from the retention of a high quality Board
and management team. Executives,
other than the non-executive directors,
are given the opportunity to receive
their base remuneration in the form of
cash and non-cash benets. To assist in
achieving these objectives, the Companys
remuneration policy links the nature and
amount of executive directors and senior
executives remuneration to the Companys
nancial and operational performance.
All key senior executives have the
opportunity to qualify for participation in
the Companys Short Term Incentive (STI)
and Long Term Incentive (LTI) Plans which
currently provide benets where specied
performance criteria are met.
Key executives are those who are directly
accountable and responsible for the
operational management and strategic
direction of the Company and the
consolidated entity.
Remuneration Committee
The Board has an established
Remuneration Committee, comprising
three independent non-executive directors
with an independent chairman. During
the nancial year, Nerolie Withnall
was appointed to the Committee as
replacement for Martin Kriewaldt who
retired from the Board on 26 July 2011
following the 2011 AGM.
Names of members and their attendance
at meetings of the Committee are set out
in the Directors Report.
The Remuneration Committee Charter was
updated during the year and is available
on the Companys website.
Structure of remuneration
The structure of non-executive directors
remuneration and that of executives is set
out in the Remuneration Report section of
the Directors Report.
Details of the nature and amount of
each element of the remuneration of
each director of the Company and each
key executive of the Company and the
consolidated entity having responsibility
for its operational performance for
the nancial year are disclosed in the
Remuneration Report section of the
Directors Report. The current non-
executive directors (NED) fee pool
of $950,000 (inclusive of statutory
superannuation) was last approved by
shareholders at the 2010 AGM. At the
2012 AGM, shareholders will be asked to
approve an increase in the NED fee pool
to $1.5 million (inclusive of statutory
superannuation), to accommodate the
increasing level of directors time spent
on Board matters, as well as providing a
general increase in line with the market.
Shareholders will also be asked to adopt,
as a non-binding vote, the Remuneration
Report as contained in the Annual Report
for the nancial year ended 31 March
2012.
Directors retirement benets
There are no Directors retirement benets
other than statutory superannuation.
Details are set out in the Remuneration
Report section of the Directors Report.
Share-based plans
The Remuneration Committee
is responsible for reviewing
recommendations with respect to issues or
grants under the Companys share-based
plans. Directors approve issues or grants
under the plans only after being satised
that this is in accordance with the terms of
shareholders approval.
Employee Share Plan
This Plan is closed to new recipients. There
were no new issues of shares under the
plan during the year.
Long Term Incentive Plan
Shareholders approved the Companys
Long Term Incentive Plan (LTIP) at the
2008 AGM. Under the plan, key employees
may be granted conditional performance
rights to receive ordinary shares in the
Company at no cost to the employees (or
in limited cases, to receive cash-settled
awards). During the nancial year 2011-12,
there were 51,893 Performance Rights
granted under the Companys LTIP, of which
13,595 Performance Rights were granted
to the Managing Director, Greg Kilmister
in accordance with terms approved at the
2011 AGM.
Corporate Social Responsibility
OPERATION SUSTAINABILITY
Operation Sustainability, launched in 2010,
is now gaining signicant momentum
across the business and is demonstrating
tangible environmental benets through
waste reduction, energy conservation and
carbon emission minimisation.
Operation Sustainability has provided
direction to all the companys businesses
through the coordination of programs
and projects aimed at environmental
protection. The greatest impact from the
program has been the willingness for
businesses across the globe to take up the
successful initiatives it reports.
The benet of this program has been
the number of projects and initiatives,
already in place or being implemented,
that are shared as a result of the program.
Capturing the good work of businesses all
over the globe and, in turn, disseminating
their success stories has been a major
coordination and communication exercise
and has seen very positive results.
The response to submitting and
sharing these experiences has been
overwhelming. This result is a testament
to the engagement of employees in
the program, their connection with the
environmental sustainability message and
their enthusiasm to share their learnings.
Operation Sustainability is not only
delivering positive outcomes for the
environment generally, the company has
found the majority of initiatives have not
only resulted in cost savings, but also
an enhanced corporate image both to
our clients and community, as well as
improved staff morale.
The number of projects being undertaken
across the globe prevents their inclusion in
this report so a number of key initiatives
are reported here.
WASTE REDUCTION
ALS Environmental won the inaugural
Sustainability and Innovation Care Award
in 2011 with its introduction of reduced
size sample containers for the analysis
of semivolatile samples. This required
enhancements to the instrumentation
sensitivity, allowing a reduction from 1L
containers to 100ml.
This size reduction has numerous positive
ow-on effects, including a 70% reduction
in glass waste, 5000L per annum reduction
in solvent waste and a reduction in
freight and refrigeration costs. Initiated in
Australia, this sample size reduction is now
being successfully rolled out globally.
ALS Tribology has also had success in
diverting waste oil sample containers
from landll and, in turn, reducing waste
production. In one site alone, some 12,000
containers previously went to landll
every month. Now, with three different
waste streams, these containers are being
re-cycled.
ALS Coal has turned waste coal samples,
which used to go to landll, into use as
fuel across a number of sites. In one site,
120 cubic metres of coal has now been
diverted to a local mill which uses the coal
to power its boilers.
All business divisions are actively engaged
in waste minimisation through the
promotion of cardboard and paper waste
recycling streams.
Campbell Brothers acknowledges its role in environmental protection and has incorporated
environmental sustainability into the companys Minimum Standards, in relation to Health, Safety and
Environment, to ensure all global businesses integrate environmental measures into their operations.
Corporate Social Responsibility
ENERGY MANAGEMENT
Energy usage, either electricity or gas, is
the companys biggest carbon emission
source, accounting for approximately 80%
of our greenhouse gas emissions.
Energy saving initiatives have been
successfully trialed in a number of existing
sites, in some cases generating reductions
of 28%. In all cases, the initiatives have
proven to be cost-effective and, in most
cases, generate cost savings in the very
short term.
Electricity savings have been achieved
in the way the businesses work, by
staggering start-up times and, in turn,
electricity demand in the peak times,
installation of variable speed drives and
timers on ventilation systems, monitoring
the air conditioning use and by reducing
building inefciencies.
Energy efciencies are also being
considered in the design phase of building
and construction. For example, the new
Richlands Coal site in Brisbane boasts a
number of energy conservation features
which are forecast to signicantly reduce
its energy usage and, subsequently, its
carbon emissions.
CLIMATE CHANGE
Work undertaken in Australia to assess the
companys greenhouse gas emission under
the National Greenhouse Energy Reporting
(NGER) scheme is now being progressed
globally. It is acknowledged the NGER
scope does not extend beyond Australia
but the principle behind understanding and
measuring the reduction in greenhouse
gases is one Campbell Brothers believes
should be implemented across the entire
organisation. The global focus has been
to target the largest energy consumers
within their respective regions, to work
on reduction strategies and then to share
those successful initiatives with similar
businesses.
SUPPORTING THE COMMUNITY
Campbell Brothers takes its responsibility
to the community very seriously and
sees work in the wider community as an
extension of social responsibility to staff
and their families. Indeed, it is Campbell
Brothers staff and their families who
drive a great number of the charity and
community projects to which the company
contributes. Wherever possible, Campbell
Brothers facilitates and supports charitable
and volunteer work with resources and
funds.
Work in and for the community is as
varied as the communities where
Campbell Brothers sites are located. From
assisting local environmental groups in
water sampling and technical advice, to
organising blood donations, responding to
natural disasters and sponsoring volunteer
organisations and groups in a local area,
the common theme is one of community-
mindedness.
Campbell Brothers actively promotes
this culture within all businesses through
the publication and global dissemination
of Global Scene - a newsletter which
regularly spotlights charitable and
volunteer work.
CAMPBELL BROTHERS LIMITED AND ITS SUBSIDIARIES
Financial report
FOR THE YEAR ENDED 31 MARCH 2012
CONTENTS
Directors report (including remuneration report) 31
Prot and loss statement 44
Statement of comprehensive income 45
Balance sheet 46
Statement of changes in equity 47
Statement of cash ows 48
Notes to the nancial statements 49
1. Reporting entity 49
2. Basis of preparation 49
3. Signicant accounting policies 49
4. Financial and capital risk management 56
5. Determination of fair value 57
6. Operating segments 58
7. Other income 60
8. Expenses 61
9. Unusual items recorded prot for the year 61
10. Auditors remuneration 61
11. Net nancing costs 62
12. Income tax expense 62
13. Earnings per share 63
14. Cash and cash equivalents 63
15. Trade and other receivables 64
16. Inventories 64
17. Other current assets 64
18. Investments accounted for using the equity method 65
19. Deferred tax assets and liabilities 65
20. Property, plant and equipment 66
21. Intangible assets 68
22. Trade and other payables 69
23. Investment property 69
24. Loans and borrowings 70
25. Capital and reserves 71
26. Financial instruments 73
27. Operating leases 76
28. Capital commitments 77
29. Contingencies 77
30. Deed of cross guarantee 77
31. Parent entity disclosures 79
32. Consolidated entities 79
33. Reconciliation of cash ows from operating activities 80
34. Acquisitions of subsidiaries and non-controlling interests 81
35. Key management personnel disclosures 83
36. Non-key management personnel related party disclosures 86
37. Share-based payments 86
38. Events subsequent to balance date 88
Directors declaration 89
Audit report 90
Lead auditors independence declaration 91
Directors report
1. DIRECTORS
The directors of the Company at any time during or since the end
of the nancial year are:
GEOFFREY J McGRATH MIIE.
Chairman and Independent Non-Executive Director Age 69
GREG F KILMISTER B Sc (Hons), FRACI, MAIG, CCEO
Managing Director and Chief Executive Ofcer Age 56
NEROLIE WITHNALL BA, LLB, FAICD
Deputy Chairman and Independent Non-Executive Director Age 68
RAYMOND G HILL FAICD
BRUCE R BROWN B Com, AAUQ, FAICD
MELVYN J BRIDGES B AppSc, PhD, FAICD
GRANT B MURDOCH M Com (Hons), FAICD, FCA
JOHN F MULCAHY PhD, BE (Civil Eng) (Hons), FIE Aust
MARTIN D KRIEWALDT BA, LLB (Hons), FAICD Age 62
Former Independent Non-Executive Director, retired on 26 July 2011.
Full directors proles are set out on page 20 of the annual Report.
2. COMPANY SECRETARY
TIM MULLEN B Bus, M Com Law, FCPA, FCIS, FCLA
Mr Mullen was appointed Company Secretary of Campbell Brothers
on 27 February 2007. He is a Chartered Secretary and a member
of CPA Australia. He has a background in nancial and commercial
management and company secretarial practice. He has been with
Campbell Brothers for fteen years. His main responsibilities are
corporate governance and legal management of the Group.
3. PRINCIPAL ACTIVITIES
The principal activities of the Group during the course of the
nancial year were:
Provision of technical testing and inspection services
specically supporting mining and mineral exploration,
commodity certication, environmental monitoring, equipment
maintenance, food and pharmaceutical quality assurance and
industrial operations.
Distribution of cleaning agents and chemicals for both domestic
and industrial customers.
Distribution of non-food consumables to the healthcare,
building services, hospitality and leisure industries.
During the year the Group expanded its testing and inspection
service capabilities through the acquisitions of:
UK-based Stewart Group, a provider of geochemical,
metallurgical and inspection services to the mining and
processing industries throughout North America, Africa, Asia
and Europe;
Columbia Analytical Services, an environmental and food
analytical group operating in the US; and
Austpower Engineering, an industrial inspection and
engineering business providing advanced inspection services to
the power generation industry in Australia.
Otherwise there were no signicant changes in the nature of the
activities of the Group during the year.
4. REVIEW AND RESULTS OF OPERATIONS
Net prot
Directors are pleased to report that the Group achieved a record
nancial result in the year to March 2012. Net prot after tax
attributable to equity holders of the Company was $222.4
million (refer to summary below). Underlying net prot after tax
(attributable to equity holders of the Company and excluding
unusual items) was also $222.4 million for the year in line with
recent guidance provided to the market. The result was up 68.2%
on the previous year and was generated from revenue of $1,405.6
million (up 26.8% on the year to March 2011).
All divisions within the ALS testing and inspection services business
recorded increased prot contributions and margins over the
previous year (refer Divisional contributions below). In particular,
strong growth in global mineral exploration activity lifted demand
for the analytical testing services provided by ALS Minerals division.
Increased sample ow, combined with earnings generated by
Ammtec (acquired November 2010) and Stewart Group (acquired
July 2011) served to deliver a 92% increase in segment prot
contribution when compared to the March 2011 year. ALS Life
Sciences division (formerly known as ALS Environmental) delivered
strong gains in revenue and prot contribution, particularly within
the Australian and North American regions.
ALS Energy (formerly known as ALS Coal) and ALS Industrial
divisions all recorded solid growth in earnings contribution
compared with the previous year. Campbell Chemical delivered
an improved prot result on lower revenue and the Reward
Distribution hospitality supplies division returned to protability
during the year.
The translation of foreign earnings was impacted by a stronger
Australian dollar during the year. The average exchange rate
against the US dollar was USD 1.05 for the March 2012 year
(2011: USD 0.95).
Directors have declared a nal partly franked (50%) dividend
for the year of $1.30 per share (2011: 75 cents partly franked)
bringing the total partly franked (50%) dividend for the year to
$2.25 per share (2011: $1.40 partly franked). The Company has
re-instated its dividend reinvestment plan - a 5.0% discount to
market price will apply for shares issued in relation to the 2012
nal dividend.
The directors present their report together with the nancial report of the Group, comprising Campbell Brothers Limited
(the Company) and its subsidiaries, for the year ended 31 March 2012 and the auditors report thereon.
Note
This Year
$000
Last Year
$000
Revenue
1,405,609 1,108,329
Underlying prot before nancing costs, income tax and unusual items 327,581 196,120
Net nancing costs (15,623) (10,244)
Income tax expense relating to underlying prot before unusual items (87,271) (53,732)
Underlying prot before unusual items 224,687 132,144
Net prot/(loss) attributable to non-controlling interests before unusual items (2,274) 64
Underlying prot before unusual items attributable to equity holders of the Company 222,413 132,208
Unusual items net of income tax attributable to equity holders of the Company 9
Gain on sale of chemical and cleaning solutions business - 8,654
Write-down to recoverable amount goodwill and inventories in Reward Distribution segment - (9,405)
Income tax effect - 897
Effect of unusual items after income tax - 146
Prot attributable to equity holders of the Company 222,413 132,354
Basic earnings per share $3.29 $2.03
Diluted earnings per share $3.29 $2.03
(Underlying prot is a non-IFRS disclosure and has been presented to assist in the assessment of the relative performance of the Group, from year to year)
Directors report
Divisional contributions
Contributions from business divisions are as follows:
ALS Minerals
2012
$000
2011
$000
Increase
Revenue 591,338 334,477 76.8%
Margin (segment
contribution to revenue)
36.3% 33.4%
ALS Minerals division delivered exceptional growth in nancial
performance during the year, processing a record number of samples
in an environment of increasing global mineral exploration activity.
Strategic expansion by the division over the past two years, in the
form of both acquisitions and capital investment, has improved
its capacity, breadth of service offering and market reach - thus
enabling the business to service a growing market successfully.
Excellent cost control disciplines are entrenched in the business and
served to produce consistently strong contribution margins.
Results were boosted by contributions from Ammtec (acquired
November 2010) and Stewart Group (acquired July 2011).
ALS Life Sciences (formerly ALS Environmental)

2012
$000
2011
$000
Increase
Revenue 360,661 308,281 17.0%
Margin (segment contribution
to revenue)
21.7% 21.5%
The ALS Life Sciences (formerly ALS Environmental) division posted
solid growth in revenue and prot contribution during the year,
particularly in the Australian and European regions. This was primarily
the result of increased market share and government project work.
Margin performance improved in most regions, representing an ability
to contain variable costs while growing the business and integrating
acquisitions.
ALS Energy (formerly ALS Coal)

2012
$000
2011
$000
Increase
Revenue 87,848 73,023 20.3%
Margin (segment
27.0% 23.5%
Contracts for new work in the South African and Canadian operations
of ALS Energy (formerly ALS Coal) division delivered improved
revenue and margin performance in those regions during the year.
The Australian business performed well ahead of the previous year,
recovering well from natural disasters which contributed to a slow
start to the year. Signicant capacity and operational efciency has
been added to the Australian operations following the relocation of
the Ipswich laboratory to Brisbane.
ALS Industrial (now incorporating ALS Tribology)
2012
$000
2011
$000
Increase
Revenue 152,532 142,372 7.1%
Margin (segment
16.0% 11.7%
The Asset Care business within ALS Industrial division reported solid
growth in revenue and prot contribution, despite the divestment of
its asset management business in July 2011. Austpower Engineering,
acquired in October 2011, contributed strongly to increased prot
contribution and margin improvement in the second half.
The Tribology business unit, now incorporated into ALS Industrial,
delivered increases in revenue and prot contribution in all regions,
primarily the result of growth of existing client relationships and
disciplined cost management.
4. REVIEW AND RESULTS OF OPERATIONS continued
Net prot continued
Directors report
4. REVIEW AND RESULTS OF OPERATIONS continued
Divisional contributions continued
Campbell Chemicals
2012
$000
2011
$000
Increase/
(Decrease)
Revenue 90,056 130,322 (30.9%)
Margin (segment
9.0% 5.7%
The Panamex trading business generated improved gross sales
margins in its key regions, in particular the PNG manufacturing and
distribution operation contributed strong sales growth and improved
gross margin supported by a tightly controlled cost base.
Deltrex Chemicals generated lower revenue and contribution levels
during the year, the fall being directly attributable to the sale of the
Cleantec business unit in December 2010.
Reward Distribution

2012
$000
2011
$000
Increase/
(Decrease)
Revenue 123,174 123,869 (0.6%)
Segment contribution 3,664 (1,811) n/a
Margin (segment contribution
to revenue)
3.0% (1.5%)
The Reward Distribution hospitality supplies business returned to
protability during the year despite a at level of revenue. This
followed the implementation of a range of cost-cutting measures,
productivity improvements, more focussed selling activities and re-
adjusted procurement strategies.
5. DIVIDENDS
Dividends paid or declared by the Company since the end of the
previous nancial year are:
Cents per
share
Franked
amount
(cents)
Total
$000
Ordinary dividends declared and paid
during the year:
Final 2011, paid 1 July 2011 75.0 37.5 50,628
Interim 2012, paid 19 December 2011 95.0 47.5 64,128
Total amount 114,756
Ordinary dividend declared after the
end of the nancial year:
Final 2012, to be paid 2 July 2012 130.0 65.0 87,754
The nancial effect of this dividend has not been brought to account
in the nancial statements for the year ended 31 March 2012 and
will be recognised in subsequent nancial reports. The franked
components of all dividends paid or declared since the end of the
previous nancial year were franked based on a tax rate of 30%.
6. STATE OF AFFAIRS
Changes in the state of affairs of the Group during the nancial
year resulted from its continued strategy of business expansion
and diversication in testing and inspection services. Specically,
the Group undertook the following major acquisitions:
UK-based Stewart Group, a provider of geochemical,
metallurgical and inspection services to the mining and
processing industries throughout North America, Africa, Asia
and Europe (acquired July 2011);
Columbia Analytical Services, an environmental and food
analytical group operating in the US (acquired October 2011);
and
Austpower Engineering, an industrial inspection and engineering
business providing advanced inspection services to the power
generation industry in Australia (acquired October 2011).
In the opinion of the directors there were no other signicant
changes in the state of affairs of the Group that occurred during
the nancial year under review not otherwise disclosed in this
report or the consolidated nancial statements.
7. REMUNERATION REPORT AUDITED
The directors present the remuneration report for the Groups Key
Management Personnel (KMP). The following people were KMPs
during the reporting period and unless otherwise stated were
KMPs for the whole of the period:
Non-executive directors:
Geoff McGrath Chairman
Chairman of the Remuneration Committee (until 1 April 2012)
Member of the Audit and Compliance Committee (until 1 April 2012)
Nerolie Withnall Deputy Chairman
Chairman of the Audit and Compliance Committee
Chairman of the Remuneration Committee (effective 1 April 2012)
Ray Hill
Member of the Audit and Compliance Committee
Bruce Brown
Member of the Remuneration Committee
Mel Bridges
(effective 1 April 2012)
Grant Murdoch (appointed 1 September 2011)
John Mulcahy (appointed 1 February 2012)
Member of the Remuneration Committee
(effective 1 April 2012).
Former non-executive director:
Martin Kriewaldt (retired 26 July 2011)
Executive director:
Greg Kilmister Chief Executive Ofcer and Managing Director (CEO)
Directors report
7. REMUNERATION REPORT AUDITED continued
Executives:
Bruce McDonald Executive Vice President, ALS Minerals
Raj Naran Executive Vice President
ALS Life Sciences North America and Europe
Brian Williams Group General Manger
ALS Life Sciences Australia, Asia and ALS Industrial
Paul McPhee Group General Manager, ALS Energy
David Brown Group General Manager, Chemical Division
Andrew Ross Group General Manager, Reward Distribution
Former executive:
Peter Jordan (former Group General Manager, ALS Tribology
resigned November 2011)
Note: references in this remuneration report to executives are references to
those executives who are KMPs as listed above, including where relevant the CEO.
Remuneration policy
The Board aims to set remuneration for all KMPs at levels which
are reasonable but designed to attract and retain appropriately
qualied people in a competitive market. In addition the aim for
executives is to provide both incentive and reward, and to align a
signicant proportion of executive reward to growth in shareholder
value, with a focus on both the short term (one year) and longer
term (three years).
Process
All aspects of remuneration for KMPs are approved by the
Board after receiving recommendations from the Remuneration
Committee (committee).
The committee consists of 3 independent non-executive directors
and operates under a charter which is published on the Companys
website.
The committee conducts annual reviews of its charter, the Group
remuneration policies and plans, the structure and details of all
KMP remuneration packages, market trends and commentary
in relation to director and executive remuneration practices and
quantums, and legislative and regulatory requirements. These
reviews take into consideration Group and individual nancial
performance, the scope of the Groups global operations, the
Groups strategic and business plans, the market capitalisation of
the Company and its place in various public indices (for example
the S&P/ASX 100). The committee also meets at other times
during the year to keep these matters under review.
In the reporting period the committee engaged Hay Group to
provide market information and analysis to assist in the review
of executive remuneration. This consultant reported directly to
the committee. The committee and the Board are satised that
the services of those consultants were provided free from undue
inuence by any KMP.
Structure
Non-executive directors
The total amount of remuneration, including superannuation, for
all non-executive directors must not exceed the limit approved
by shareholders. The last approval was for $950,000 per annum
approved at the 2010 AGM.
Non-executive directors are paid fees xed by the Board and do
not receive remuneration which is equity-based or performance-
related. The levels of directors remuneration are set having regard
to independent survey data and publicly available information
about fees paid to non-executive directors in a range of
comparable companies.
The structure current for the reporting period for annual payments,
exclusive of mandatory superannuation contributions, was
Chairman of the Board: $210,000 (covers all responsibilities as
Chairman of the Board and the Remuneration Committee and
member of the Audit and Compliance Committee)
Other non-executive directors: Board membership: $105,000
Committee membership:
Audit and Compliance Committee
$
Remuneration Committee
$
Chairman 25,000 n/a *
Member 12,500 2,500
* currently lled by the Chairman of the Board
Executive director and other executives
All executive packages comprise:
xed remuneration of cash, superannuation/pension
contributions and benets
variable remuneration under the Groups short term incentive
(STI) and long term incentive (LTI) plans.
Fixed remuneration for each individual executive:
is approved in advance each year by the Board
may, at the election of the executive, include non-cash benets
such as a motor vehicle, and/or components of salary sacrice
as additional superannuation contributions
includes all fringe benets tax or equivalent charges related to
the executives non-cash benets
is set having regard to each individual executives duties and
responsibilities, the scope of the executives business unit,
individual performance, contribution and experience, and,
where available, comparable market information.
Variable remuneration for each individual executive:
is approved in advance by the Board
is set to encourage excellent performance, to focus effort
on key business drivers, and to reward performance and
contribution.
Directors report
Executive director and other executives continued
STI plan
Features of the STI plan:
amounts which can be earned as a cash bonus are set by the
Board for each executive
payments to the CEO may not exceed 60% of his total xed
remuneration and are between 20% and 40% of other
executives total xed remuneration
payments are contingent on the achievement of specied
individual nancial and other performance indicators (KPIs) for
the nancial year; for the CEO 80% of the possible STI amount
depends on achievement of KPIs based on Group net prot after
tax, and for other executives 70% depends on achievement of
KPIs based on earnings before interest and tax for the Group
or for individual business units; the balance of the STI amounts
for the CEO and other executives depend on KPIs measuring
performance in relevant areas of health, safety and the
environment, risk management, strategic plan delivery, return
on sales and revenue growth, leadership and team contribution,
workforce capability and succession planning
amounts are only paid on full achievement of a KPI (that is,
if there is nil or partial achievement of a KPI, the STI amount
assigned to that KPI is not paid)
payments are not made to executives found to have
misrepresented their nancial and non-nancial KPI results;
material misstatements discovered after an STI payment has
been made may result in the executive having to return the
payment to the Company.
LTI plan (equity-based)
Features of the LTI plan:
remuneration under the LTI plan is in the form of equity-settled
performance rights; and in jurisdictions where securities
legislation does not permit this, rights are cash settled
performance rights are granted each year to certain executives,
who being entitled to receive STI payments, are invited to
participate in the LTI plan by the CEO with the Boards approval
the number of performance rights granted to an executive
is calculated by dividing the amount of the executives STI
payment by the volume weighted average price (VWAP) of the
Companys shares over the 20 trading days following the date
of announcement of the nal full year results for the nancial
year preceding the period to which the grant of performance
rights relate
the vesting of rights is subject to the Companys achievement of
cumulative performance hurdles over the performance period
(usually three years)
the performance hurdles are based on earnings per shares (EPS)
and on relative Total Shareholder Return (TSR) measures over
the performance period
the cumulative performance hurdles are assessed at the end
of the performance period and the performance rights become
exercisable, in whole or in part, or are forfeited from 1 July
following the end of each period
LTI plan rules prohibit those who are granted performance rights
from entering into arrangements that limit their exposure to
share price decreases
each equity-settled performance right which vests and is
exercised converts to an ordinary share in the Company at nil
exercise price
the amount payable per cash-settled performance right which
vests is the VWAP of the Companys shares over the 20 trading
days following the release of the Companys full year results for
the nal year of each performance period
the executive must be employed in the Group on the vesting
date to be eligible for issue of the shares (equity-settled rights)
or receipt of payment (cash-settled rights).
The performance hurdles and vesting proportions for each criterion are as follows:
Proportion of performance rights
that may be exercised if EPS growth
hurdle is met
Compound annual diluted EPS growth
2009 issue 2010 issue 2011 issue
0% Less than 13% per annum Less than 13% per annum Less than 10% per annum
25% 13% per annum 13% per annum 10% per annum
Straight line vesting between
25% and 50%
Between 13% and 20%
per annum
Between 13% and 20%
per annum
Between 10% and 14%
per annum
50% (i.e. 50% of total grant) 20% or higher per annum 20% or higher per annum 14% or higher per annum
Performance period 1 Apr 10 31 Mar 12 1 Apr 10 31 Mar 13 1 Apr 11 31 Mar 14
Directors report
Proportion of performance rights that
may be exercised if TSR hurdle is met
TSR of Campbell Brothers Ltd relative to TSRs of comparator companies
2009 issue 2010 issue 2011 issue
0% Less than the 50th percentile Less than the 50th percentile Less than the 50th percentile
25% 50th percentile 50th percentile 50th percentile
Straight line vesting between
25% and 50%
Between 50th percentile and
75th percentile
75th percentile
75th percentile
50% (i.e. 50% of total grant) 75th percentile or higher 75th percentile or higher 75th percentile or higher
Performance period 1 Apr 09 31 Mar 12 1 Apr 10 31 Mar 13 1 Apr 11 31 Mar 14
Comparator companies
International companies:
Bureau Veritas (France), Core
Laboratories (USA), Eurons
(France & Germany), Intertek
(UK), SGS (Switzerland),
Australian companies:
Ausenco, Boart Longyear,
Cardno, Clough, Coffey Inter-
national, MacMahon Holdings,
Monadelphous, Orica, Servcorp,
Transeld Services, WorleyPar-
sons.
Cardno, Clough, Coffey Interna-
tional, Industrea, MacMahon
Holdings, Monadelphous, Orica,
Sedgman, Servcorp, Transeld
Services, WorleyParsons.
Cardno, Clough, Coffey Interna-
tional, Industrea, MacMahon
Holdings, Monadelphous, Orica,
Sedgman, Servcorp, Transeld
Services, WorleyParsons
Consequences of performance on shareholders wealth
In considering the Groups performance and creation of shareholder wealth, the Board has regard to the following nancial data in respect
of the current nancial year and the previous four nancial years:
Year ended 31 March
2012
$000
2011
$000
2010
$000
2009
$000
2008
$000
Prot attributable to equity holders of the Company 222,413 132,354 75,301 106,209 76,819
Prot (excluding unusual items) attributable to equity
holders of the Company
222,413 132,208 75,301 106,209 71,270
Dividends paid or payable 151,882 94,152 62,780 52,806 49,456
Share price at balance date $67.23 $46.35 $29.55 $13.60 $25.00
Service contracts
The Group has not entered into any formal service contracts with its non-executive directors. Executives have appropriate contractual ar-
rangements. In the event of termination without cause, the Group is required to pay between three and twelve months of salary.
Directors report
Key Management Personnel remuneration (Consolidated)
Details of the nature and amount of each major element of remuneration of each KMP are set out below. Following approval by the Board,
changes in salary generally take effect from 1 July each year.
Short-term Long-term
Post-
employment
In AUD Salary & fees
$
STI cash
bonus (a)
$
Non-
monetary
benets (b)
$
Value of
share-based
awards (c)
$
Other long
term
$
Superannuation
and pension
benets
$
Termination
benets
$
Total
$
Directors
Non-executive
directors
G J McGrath 2012 157,500 - - - 619 68,675 - 226,794
2011 182,500 - - - 612 16,424 - 199,536
N Withnall 2012 130,000 - - - 619 11,700 - 142,319
2011 113,333 - - - 612 10,200 - 124,145
R G Hill 2012 116,250 - - - 619 10,463 - 127,332
2011 100,833 - - - 612 9,075 - 110,520
B R Brown 2012 35,833 - - - 619 79,979 - 116,431
2011 73,750 - - - 612 25,253 - 99,615
M J Bridges 2012 103,750 - - - 619 9,338 - 113,707
2011 88,333 - - - 612 7,950 - 96,895
G B Murdoch
(appointed 1 Sep 2011)
2012 69,583 - - - 361 6,263 - 76,207
2011 - - - - - - - -
J F Mulcahy
(appointed 1 Feb 2012)
2012 17,500 - - - 103 1,575 - 19,178
2011 - - - - - - - -
M D Kriewaldt
(retired 26 Jul 2011)
2012 38,750 - - - 206 4,388 - 43,344
2011 103,333 - - - 612 9,300 - 113,245
Executive director
G F Kilmister 2012 1,056,250 675,000 11,753 483,485 619 50,000 - 2,277,107
2011 984,065 630,000 17,106 418,219 612 49,268 - 2,099,270
Executives
B McDonald 2012 441,693 191,626 4,510 154,309 347 - - 792,485
2011 416,336 149,146 5,207 163,656 380 - - 734,725
R Naran 2012 341,525 161,290 - 147,510 347 11,913 - 662,585
2011 295,498 126,396 - 78,676 380 10,322 - 511,272
B Williams 2012 397,738 200,000 7,754 89,423 347 24,866 - 720,128
2011 302,691 135,000 33,696 92,147 380 25,631 - 589,545
P McPhee 2012 411,675 182,000 - 83,861 347 20,058 - 697,941
2011 331,805 100,000 - 94,228 380 29,862 - 556,275
D Brown 2012 291,258 50,000 - 12,258 347 24,992 - 378,855
2011 258,258 42,500 19,800 40,391 380 23,110 - 384,439
A Ross (d) 2012 269,265 30,000 - - 347 24,234 - 323,846
2011 151,823 n/a - - 222 13,664 - 165,709
P Jordan (e) 2012 227,482 - - (40,868) 231 20,560 18,102 225,507
2011 220,582 30,000 68 60,141 380 27,495 - 338,666
C Clements (f) 2012 - - - - - - - -
2011 98,508 - 8,125 - 158 8,936 82,738 198,465
Total Compensation:
key management
personnel
2012 4,106,052 1,489,916 24,017 929,978 6,697 369,004 18,102 6,943,766
2011 3,721,648 1,213,042 84,002 947,458 6,944 266,490 82,738 6,322,322
Directors report
Directors and executive ofcers remuneration (Consolidated) continued
(a) STI cash bonuses are paid annually following the end of the preceding nancial year. The grant date is tied to the performance appraisal which for the current year
was completed by 31 March.
(b) Non-monetary benets include payment of allowances, provision of other benets such as motor vehicles, fringe benets tax thereon and an amount representing
commercial interest that would have been charged during the period on the executives outstanding employee loan balances owed to the Company had these loans
not been interest free.
(c) The LTI Plan was introduced in April 2008. Performance rights were granted in each of the years ended March 2009, 2010, 2011 and 2012. Refer to note 37 for
details. The fair value of performance rights granted during both years were calculated using Binomial Tree (EPS hurdle) and Monte-Carlo Simulation (TSR hurdle)
valuation methodologies and allocated to each nancial year evenly over the period from grant date to vesting date.
(d) Mr Ross commenced with the Group in August 2010.
(e) Mr Jordan ceased employment with the Group in November 2011. The negative value allocated to share-based awards represents the reversal of expense recorded
in previous years in relation to performance rights which lapsed on cessation of employment.
(f) Ms Clements ceased employment with the Group in August 2010.
Analysis of cash bonuses included in remuneration
Details of the vesting prole of the short term incentive cash bonuses awarded as remuneration to each of the named executives are
detailed below:
Included in remuneration $ (a) % vested % forfeited (b)
Executives
G F Kilmister 2012 675,000 100 -
2011 630,000 100 -
B McDonald 2012 191,626 100 -
2011 149,146 90 10
R Naran 2012 161,290 100 -
2011 126,396 100 -
B Williams 2012 200,000 100 -
2011 135,000 90 10
P McPhee 2012 182,000 91 9
2011 100,000 67 33
D Brown 2012 50,000 100 -
2011 42,500 50 50
A Ross (c) 2012 30,000 50 50
2011 n/a n/a n/a
P Jordan (d) 2012 - - 100
2011 30,000 38 62
C Clements (e) 2012 n/a n/a n/a
2011 - - 100
(a) Amounts included in remuneration for the nancial year represent the amounts that vested in the nancial year based on the achievement of personal goals and
satisfaction of specied performance criteria.
(b) The amounts forfeited are due to the performance or service criteria not being met in relation to the nancial year.
(c) Mr Ross commenced with the Group in August 2010 and was not a participant in the STI plan during the year to March 2011.
(d) Mr Jordan ceased employment with the Group in November 2011.
(e) Ms Clements ceased employment with the Group in August 2010.
Directors report
Proportion of performance related and equity based remuneration
Details of each of the named executives performance related and equity based remuneration as a proportion of their total remuneration is
detailed below:
Proportion of remuneration
performance based %
Value of performance rights as a
proportion of remuneration %
Executives
G F Kilmister 2012 50.9 21.2
2011 49.9 19.9
B McDonald 2012 43.7 19.5
2011 42.6 22.3
R Naran 2012 46.6 22.3
2011 40.1 15.4
B Williams 2012 40.2 12.4
2011 38.5 15.6
P McPhee 2012 38.1 12.0
2011 34.9 16.9
D Brown 2012 16.4 3.2
2011 21.6 10.5
A Ross (a) 2012 9.3 n/a
2011 n/a n/a
P Jordan (b) 2012 (18.1) (18.1)
2011 26.6 17.8
C Clements (c) 2012 n/a n/a
2011 - -
(a) Mr Ross commenced with the Group in August 2010 and was not a participant in the STI Plan during the year to March 2011. He has not been a participant in the LTI
plan.
(b) Mr Jordan ceased employment with the Group in November 2011. The negative values above represent the reversal of expense recorded in previous years in
relation to performance rights which lapsed on cessation of employment.
(c) Ms Clements ceased employment with the Group in August 2010.
Directors report
Performance rights over ordinary shares granted as remuneration
Details of vested and outstanding performance rights over ordinary shares in the Company that were granted as remuneration to each KMP
under the LTI Plan.
Grant date Number of
rights granted
(a)
Fair value per
right at grant
date (b)
Issue price
used to
determine
no. of rights
granted (b)
Vesting date Number of
rights vested
and exercised
Number of
rights lapsed
(c)
% of rights
lapsed (c)
Executives
G F Kilmister 26 Jul 11 13,595 $36.02 $46.34 1 Jul 14 - - -
27 Jul 10 10,676 $25.06 $28.09 1 Jul 13 - - -
24 Nov 09 29,703 $23.57 $19.19 1 Jul 12 - - -
5 Aug 08 7,388 $24.16 $29.44 1 Jul 11 6,118 1,270 17%
B McDonald 26 Jul 11 3,097 $36.02 $46.34 1 Jul 14 - - -
27 Jul 10 3,754 $25.06 $28.09 1 Jul 13 - - -
1 Oct 09 9,207 $26.91 $19.19 1 Jul 12 - - -
3 Sep 08 3,502 $29.46 $29.44 1 Jul 11 2,900 602 17%
R Naran 26 Jul 11 2,505 $36.02 $46.34 1 Jul 14 - -
27 Jul 10 3,907 $25.06 $28.09 1 Jul 13 - -
3 Sep 08 2,112 $29.46 $29.44 1 Jul 11 1,749 363 17%
B Williams 26 Jul 11 2,913 $36.02 $46.34 1 Jul 14 - -
27 Jul 10 3,203 $25.06 $28.09 1 Jul 13 - -
30 Jun 09 5,712 $17.29 $19.19 1 Jul 12 - -
3 Sep 08 2,751 $29.46 $29.44 1 Jul 11 2,278 473 17%
P McPhee 26 Jul 11 2,158 $36.02 $46.34 1 Jul 14 - - -
27 Jul 10 3,203 $25.06 $28.09 1 Jul 13 - - -
30 Jun 09 5,811 $17.29 $19.19 1 Jul 12 - - -
3 Sep 08 2,853 $29.46 $29.44 1 Jul 11 2,363 490 17%
D Brown 26 Jul 11 917 $36.02 $46.34 1 Jul 14 - - -
3 Sep 08 2,726 $29.46 $29.44 1 Jul 11 2,257 469 17%
P Jordan (d) 27 Jul 10 1,868 $25.06 $28.09 1 Jul 13 - 1,868 100%
30 Jun 09 3,327 $17.29 $19.19 1 Jul 12 - 3,327 100%
3 Sep 08 2,038 $29.46 $29.44 1 Jul 11 1,688 350 17%
(a) Performance rights granted to Mr Naran are cash-settled rights. Performance rights granted to all other executives named above are equity-settled rights.
(b) The issue price used to determine the number of rights offered in each year to all participants, including Mr Kilmister and other key management personnel, was
the volume weighted average price of the Companys shares during the twenty trading days following the announcement of the Groups annual nancial results. The
grant dates and corresponding fair values per right in the above table have been determined in accordance with Australian Accounting Standards and are dependent
on the dates on which individual executives are deemed to have received their offers to participate in the Plan. Fair values have been calculated using Binomial Tree
(EPS hurdle) and Monte-Carlo Simulation (TSR hurdle) valuation methodologies.
(c) The number of rights lapsed represents rights lapsed due to performance hurdles not being met and/or rights lapsed on cessation of employment. Performance
hurdle testing at 31 March 2011 of rights granted in August and September 2008 resulted in 83% of rights vesting and 17% of rights lapsing.
(d) Mr Jordan ceased employment with the Group in November 2011.
Directors report
8. ENVIRONMENTAL REGULATION
The Group is committed to complying with environmental
legislation, standards, and codes of practice relevant to the
particular business in the areas in which it operates. The
main chemical manufacturing facilities, located in Sydney and
Melbourne, are regulated under State and local government
legislation. Each site holds a current licence and or consent from
the relevant environment protection authority or local council.
Environmental management
As part of the Groups compliance program, environmental matters
are reported on monthly by all divisional managers. In addition,
internal sign-offs are completed by all managers on a yearly
basis, reporting on performance against relevant environmental
legislation and key environmental risks in their area of operations.
Apart from complying with local legal requirements each site
location across the world operates under the corporate health
safety and environment minimum standard which sets out 13
key standards including identication and management of key
environmental risks, emergency planning, reporting environmental
incidents, and conducting monthly audits.
The Group participates directly in national industry associations,
namely ACCORD Australasia. ACCORD liaises with government
authorities, reviews regulation and develops pro-active industry
policies on relevant environmental issues.
Initiatives
There were a number of environmental initiatives implemented
during the year including:
ALS Environmental in Australia won the inaugural Sustainability
and Innovation Care Award in 2011 with its introduction of
reduced size sample containers for the analysis of semi volatile
samples. This required enhancing of the instrumentation
sensitivity allowing a reduction from 1L containers to 100ml.
This size reduction has numerous positive ow-on effects
including a 70% reduction in glass waste, 5000L per annum
reduction in solvent waste and a reduction in freight and
refrigeration costs.
ALS Tribology was successful in diverting waste oil sample
containers from landll and in turn reducing their waste
production. In one site alone some 12000 containers used to go
to landll every month, now with three different waste streams
separated onsite, the containers are being re-cycled.
ALS Coal has turned waste coal samples away from land ll and
into fuel in a number of sites. In one site, 120 cubic meters of
coal which was destined for land ll has now been diverted to a
local mill which uses the coal to power its boilers.
Energy saving initiatives has been successfully trialled on
a number of existing facilities, in some cases generating
reductions of 28%. E.g. installation of variable speed drives and
timers on ventilation systems, installation of energy efcient
lighting, monitoring of air conditioning usage and reducing
building inefciencies.
Performance against environmental compliance requirements
There were no material breaches of environmental statutory
requirements and no prosecutions launched against the Group
during the year. One minor breach occurred at Reward Distribution
in Toowoomba Queensland, resulting in a penalty notice and ne
of $2,000 being issued by the local authority for a small spill of
sodium hypochlorite which migrated offsite. Internal and external
audits and internal reporting and monitoring have indicated a high
level of compliance with site licence conditions, relevant legislation
and corporate minimum standards.
9. EVENTS SUBSEQUENT TO REPORTING DATE
On 4 April 2012, the Group acquired Eclipse Scientic Group
(Eclipse) and Advanced Micro Services (AMS) for a combined
enterprise value of approximately $40 million. UK-based Eclipse is
a provider of food, dairy, water and pharmaceutical testing services
to a blue chip customer base comprising manufacturers, food
processors and retailers. AMS provides similar services to the Irish
market. The companies will be integrated into the Groups newly
formed ALS Life Sciences Division and are an important part of the
Groups strategy to build a global food / pharmaceutical laboratory
services business.
Other than the matter discussed above, there has not arisen in the
interval between the end of the nancial year and the date of this
report any item, transaction or event of a material and unusual
nature likely, in the opinion of the directors of the company, to
affect signicantly the operations of the Group, the results of those
operations, or the state of affairs of the Group, in future nancial
years.
10. LIKELY DEVELOPMENTS
The Groups objective during the next nancial year will be to
maximise earnings and investment returns across all the business
units in its diversied portfolio.
11. DIRECTORS INTERESTS
The relevant interest of each director in the share capital of the
Company as notied by the directors to the Australian Securities
Exchange in accordance with section 205G(1) of the Corporations
Act 2001 as at the date of this report is:
Ordinary shares
G J McGrath 297,810
G F Kilmister 144,599
N Withnall 2,559
R G Hill 14,000
B R Brown 30,000
M J Bridges 3,420
G B Murdoch 7,000
J F Mulcahy -
Refer to the Remuneration Report on page 40 for details of
performance rights held by Mr Kilmister.
Directors report
12. DIRECTORS MEETINGS
The number of directors meetings (including meetings of
committees of directors) and number of meetings attended by
each of the directors of the Company during the nancial year are:
Board
Meetings*
Audit and
Compliance
Committee
Meetings (1)
Remuneration
Committee
Meetings
A B A B A B
G J McGrath 10 10 4 4 3 3
G F Kilmister 10 10 - - - -
N Withnall^^ 10 9 4 4 1 1
R G Hill 10 10 4 4 - -
B R Brown 10 10 - - 3 3
M J Bridges 10 9 - - - -
G B Murdoch** 5 5 2 2 - -
J F Mulcahy*** 2 2 - - - -
M D Kriewaldt^ 4 3 1 - 2 1
A Number of meetings held during the time the director held
ofce during the year
B Number of meetings attended
(1) Although not members of the Audit & Compliance Committee, Messrs Brown,
Bridges and Kilmister attend meetings of the Committee as permitted by the
Committees Charter.
* included two meetings of the Nominations Committee, which comprises the
full Board.
^ retired from the Board following the AGM on 26 July 2011.
^^ replaced M D Kriewaldt on the Remuneration Committee.
** appointed to the Board effective 1 September 2011. Replaced MD Kriewaldt
on the Audit & Compliance Committee.
*** appointed to the Board effective 1 February 2012.
13. INDEMNIFICATION AND INSURANCE OF
DIRECTORS AND OFFICERS
Indemnication
Under its Constitution, and by resolution of the Board, the
Company has agreed to indemnify to the extent permitted by law
and the Corporations Act 2001:
every person and employee who is or has been an ofcer of
the Company or of a Group entity where requested to do so,
including a director or secretary, against any liability (other
than for legal costs) incurred by that person or employee as an
ofcer of the Company or of a Group entity (including liabilities
incurred by that person or employee as an ofcer of the
Company or of a Group entity where the Company requested
that person or employee to accept that appointment).
every person and employee who is or has been an ofcer of
the Company or of a Group entity where requested to do so,
including a director or secretary, against reasonable legal costs
incurred in defending an action for a liability incurred by that
person or employee as an ofcer of the Company or of a Group
entity (including such legal costs incurred by that person or
employee as an ofcer of the Company or of a Group entity
where the Company requested that person or employee to
accept that appointment).
Insurance premiums
During the nancial year the Company paid insurance premiums
in respect of directors and ofcers liability and legal expense
insurance contracts, for current and former directors and senior
executives, including senior executives of its subsidiaries. The
current directors are listed elsewhere in this report. The insurance
relates to:
costs and expenses incurred by the relevant ofcers in
defending proceedings, whether civil or criminal and whatever
their outcome; and
other liabilities that may arise from their position, with the
exception of conduct involving a wilful breach of duty or
improper use of information or position to gain a personal
advantage.
It is a condition of the policies that premiums paid and terms and
conditions of the policies are not to be disclosed.
14. NON-AUDIT SERVICES
During the year KPMG, the Companys auditor, has performed
certain other services in addition to statutory duties.
The Board has considered the non-audit services provided during
the year by the auditor and in accordance with written advice
provided by resolution of the Audit and Compliance Committee, is
satised that the provision of those non-audit services during the
year by the auditor is compatible with, and did not compromise,
the auditor independence requirements of the Corporations Act
2001 for the following reasons:
all non-audit services were subject to the corporate governance
procedures adopted by the Company and have been reviewed
by the Audit and Compliance Committee to ensure they do not
impact the integrity and objectivity of the auditor; and
the non-audit services provided do not undermine the general
principles relating to auditor independence as set out in APES
110 Code of Ethics for Professional Accountants, as they did not
involve reviewing or auditing the auditors own work, acting in
a management or decision making capacity for the Company,
acting as an advocate for the Company or jointly sharing risks
and rewards.
Details of the amounts paid to the auditor of the Company, KPMG,
and its related practices for audit and non-audit services provided
during the year are set out below. In addition, amounts paid to
other auditors for the statutory audit have been disclosed:
Directors report
Consolidated
2012 2011
Audit services
Auditors of the Company
KPMG Australia:
Audit and review of consolidated and company nancial reports * 484,000 451,000
Audit of subsidiarys nancial report 40,000 45,000
Other regulatory audits 4,500 4,200
Other KPMG member rms:
Audit and review of nancial reports* 672,693 383,352
1,201,193 883,552
Other auditors
Audit and review of nancial reports 106,646 69,913
1,307,839 953,465
Other services
Auditors of the company
KPMG Australia
Other assurance and investigation services 22,364 52,750
Taxation services 136,266 65,974
Other assurance and investigation services 72,146 737
230,776 119,461
* Includes impact of acquisitions during the nancial year.
15. LEAD AUDITORS INDEPENDENCE DECLARATION
The Lead auditors independence declaration is set out on page 91 and forms part of the directors report for the nancial year ended 31 March 2012.
16. ROUNDING OFF
The Company is of a kind referred to in ASIC Class Order 98/100 dated 10 July 1998 and in accordance with that Class Order, amounts in the
nancial report and directors report have been rounded off to the nearest thousand dollars, unless otherwise stated.
Signed in accordance with a resolution of the directors:
G J McGrath G F Kilmister
Chairman Managing Director
Brisbane Brisbane
21 May 2012 21 May 2012
14. NON-AUDIT SERVICES continued
Prot and loss statement
Consolidated
In thousands of AUD Note 2012 2011
Revenue from sale of goods
213,230 249,952
Revenue from rendering of services 1,192,379 858,377
1,405,609 1,108,329
Other income 7 1,851 10,941
Changes in inventories of nished goods and work in progress 13,403 (704)
Raw materials and consumables purchased (251,577) (226,499)
Employee expenses (518,635) (408,849)
Warehousing and distribution costs (33,045) (27,376)
Amortisation and depreciation (46,199) (42,172)
Selling expenses (14,256) (12,478)
Administration and other expenses (230,954) (206,066)
Share of net prots of associates and joint ventures accounted for using the equity method 18 1,384 243
Prot before nancing costs and income tax 327,581 195,369
Finance income 11 1,788 1,053
Finance expense 11 (17,411) (11,297)
Net nance expense (15,623) (10,244)
Prot before income tax 311,958 185,125
Income tax expense 12 (87,271) (52,835)
Prot for the year 224,687 132,290
Attributable to:
Equity holders of the company 222,413 132,354
Non-controlling interest 2,274 (64)
Prot for the year 224,687 132,290
Basic earnings per share 13 329.48c 203.19c
Diluted earnings per share 13 328.82c 202.78c
Dividends per share 25 $2.25 $1.40
The prot and loss statement is to be read in conjunction with the notes to the nancial statements set out on pages 49 to 88.
Statement of comprehensive income
Consolidated
Prot for the year
224,687 132,290
Other comprehensive income *
Foreign exchange translation 25 (3,469) (14,644)
Net (loss) on hedge of net investments in foreign subsidiaries 25 (2,759) (487)
Net gain/(loss) on cash ow hedges taken to equity 25 (871) 2,040
Other comprehensive income for the year, net of income tax (7,099) (13,091)
Total comprehensive income for the year 217,588 119,199
Attributable to:
Equity holders of the company 215,314 119,263
Non-controlling interest 2,274 (64)
Total comprehensive income for the year 217,588 119,199
* All movements in comprehensive income are disclosed net of applicable income tax.
The statement of comprehensive income is to be read in conjunction with the notes to the nancial statements set out on pages 49 to 88.
Balance sheet
AS AT 31 MARCH 2012
Consolidated
Assets
Cash and cash equivalents 14 133,354 87,123
Trade and other receivables 15 267,583 193,484
Inventories 16 80,512 64,119
Other 17 24,649 11,861
Total current assets 506,098 356,587
Receivables 15 2,054 4,909
Investments accounted for using the equity method 18 10,881 17,134
Investment property 23 11,079 11,139
Deferred tax assets 19 13,156 13,395
Property, plant and equipment 20 324,604 265,131
Intangible assets 21 767,677 503,490
Other investments 165 162
Total non-current assets 1,129,616 815,360
Total assets 1,635,714 1,171,947
Liabilities
Bank overdraft 14 1,161 3,135
Trade and other payables 22 123,193 95,721
Loans and borrowings 24 4,054 42,782
Income tax payable 28,474 13,581
Employee benets 38,981 31,449
Total current liabilities 195,863 186,668
Loans and borrowings 24 498,787 152,680
Deferred tax liabilities 19 1,696 1,681
Other 6,256 2,610
Total non-current liabilities 509,647 159,759
Total liabilities 705,510 346,427
Net assets 930,204 825,520
Equity
Share capital 25 610,382 610,382
Reserves (36,931) (30,315)
Retained earnings 351,171 243,974
Total equity attributable to equity holders of the company 924,622 824,041
Non-controlling interest 5,582 1,479
Total equity 930,204 825,520
The balance sheet is to be read in conjunction with the notes to the nancial statements set out on pages 49 to 88.
Statement of changes in equity
Consolidated
In thousands of AUD Note
Share
Capital
Foreign
Currency
Translation
Hedging
reserve
Employee
share-based
awards
Retained
earnings Total
Non-
controlling
Interest
Total
Equity
Balance 1 April 2011 610,382 (33,020) 871 1,834 243,974 824,041 1,479 825,520
Total comprehensive income for the period
Prot or loss - - - - 222,413 222,413 2,274 224,687
Other comprehensive income
Foreign exchange translation differences - (3,469) - - - (3,469) - (3,469)
Net gain/(loss) on hedge of net investments in foreign
subsidiaries
- (2,759) - - - (2,759) - (2,759)
Net gain/(loss) on cash ow hedges taken to equity - - (871) - - (871) - (871)
Total other comprehensive income - (6,228) (871) - - (7,099) - (7,099)
Total comprehensive income for the period - (6,228) (871) - 222,413 215,314 2,274 217,588
Transactions with equity holders, recorded directly in
equity Contributions by and distributions to owners
Dividends to equity holders 25 - - - - (114,756) (114,756) (887) (115,643)
Share-settled performance rights awarded during
the period
37 - - - 1,241 - 1,241 - 1,241
Share-settled performance rights vested during the period 37 - (758) (460) (1,218) - (1,218)
Non-controlling interest ownership of subsidiary acquired - - - - - - 2,716 2,716
Total contributions by and distributions to owners - - - 483 (115,216) (114,733) 1,829 (112,904)
Balance at 31 March 2012 610,382 (39,248) - 2,317 351,171 924,622 5,582 930,204
Balance 1 April 2010 456,734 (17,889) (1,169) 859 189,772 628,307 1,437 629,744
Total comprehensive income for the period
Prot or loss - - - - 132,354 132,354 (64) 132,290
Foreign exchange translation differences - (14,644) - - - (14,644) - (14,644)
Net gain/(loss) on hedge of net investments in foreign
subsidiaries
- (487) - - - (487) - (487)
Net gain/(loss) on cash ow hedges taken to equity - - 2,040 - - 2,040 - 2,040
Total other comprehensive income - (15,131) 2,040 - - (13,091) - (13,091)
Total comprehensive income for the period - (15,131) 2,040 - 132,354 119,263 (64) 119,199
Transactions with equity holders, recorded directly in
equity Contributions by and distributions to owners
Dividends to equity holders - - - - (78,152) (78,152) - (78,152)
Shares issued under dividend reinvestment plan 25 32,600 - - - 32,600 - 32,600
Shares issued pursuant to the Ammtec takeover offer 25 121,048 - - - - 121,048 - 121,048
Share-settled performance rights awarded during the
period
37 - - - 975 - 975 - 975
Non-controlling interest ownership of subsidiary acquired - - - - - - 106 106
Total contributions by and distributions to owners 153,648 - - 975 (78,152) 76,471 106 76,577
Balance at 31 March 2011 610,382 (33,020) 871 1,834 243,974 824,041 1,479 825,520
The statement of changes in equity is to be read in conjunction with the notes to the nancial statements set out on pages 49 to 88.
Statement of cash ows
Consolidated
Cash ows from operating activities
Cash receipts from customers 1,488,802 1,178,430
Cash paid to suppliers and employees (1,170,832) (967,669)
Cash generated from operations 317,970 210,761
Interest paid (17,410) (11,297)
Interest received 1,788 1,053
Income taxes paid (73,399) (41,675)
Net cash from operating activities 33 228,949 158,842
Cash ows from investing activities
Payments for property, plant and equipment (82,941) (70,791)
Repayments/(loans) joint venture entity (387) (638)
Payments for net assets on acquisition of businesses and subsidiaries (197,535) (52,139)
Proceeds from sale of subsidiary 4,471 -
Proceeds from sale of chemical and cleaning solutions business - 43,891
Costs incurred in disposing of chemical and cleaning solutions business - (1,447)
Dividend from associate 510 2,370
Proceeds from sale of other non-current assets 1,545 3,377
Net cash from investing activities (274,337) (75,377)
Cash ows from nancing activities
Proceeds from borrowings 376,488 229,448
Repayment of borrowings (162,887) (236,122)
Lease payments (2,607) (3,077)
Lease receipts - 554
Dividends paid (115,571) (45,416)
Net cash from nancing activities 95,423 (54,613)
Net increase/(decrease) in cash and cash equivalents 50,035 28,852
Cash and cash equivalents at 1 April 83,988 57,918
Effect of exchange rate uctuations on cash held (1,830) (2,782)
Cash and cash equivalents at 31 March 14 132,193 83,988
The statement of cash ows is to be read in conjunction with the notes to the nancial statements set out on pages 49 to 88.
Notes to the nancial statements
1. REPORTING ENTITY
Campbell Brothers Limited (the Company) is a company
domiciled in Australia. The consolidated nancial report of
the Company for the year ended 31 March 2012 comprises
the Company and its subsidiaries (together referred to as
the Group) and the Groups interest in associates and
jointly controlled entities.
2. BASIS OF PREPARATION
(a) Statement of compliance
The nancial report is a general purpose nancial report
which has been prepared in accordance with Australian
Accounting Standards (AASBs) adopted by the Australian
Accounting Standards Board (AASB) and the Corporations
Act 2001. The consolidated nancial report of the Group
also complies with the International Financial Reporting
Standards (IFRSs) adopted by the International Accounting
Standards Board.
The nancial report was authorised for issue by the directors
on 21 May 2012.
(b) Basis of measurement
The nancial report is prepared on the historical cost basis
except that derivative nancial instruments and liabilities
for cash-settled share based payments are measured at fair
value.
(c) Functional and presentation currency
The nancial report is presented in Australian dollars which
is the Companys functional currency. The Company is of a
kind referred to in ASIC Class Order 98/100 dated 10 July
1998 and in accordance with that Class Order, amounts in
the nancial report have been rounded off to the nearest
thousand dollars, unless otherwise stated.
(d) Use of estimates and judgements
The preparation of a nancial report requires management
to make judgements, estimates and assumptions that affect
the application of policies and reported amounts of assets
and liabilities, income and expenses. The estimates and
associated assumptions are based on historical experience
and various other 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.
The 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
if the revision affects only that period, or in the period of
the revision and future periods if the revision affects both
current and future periods.
In particular the most signicant uses of estimates and
judgements are described in note 21 Intangible assets and
note 34 Acquisitions of subsidiaries and non-controlling
interests.
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies set out below have been applied
consistently to all periods presented in the consolidated
nancial report.
(a) Basis of consolidation
Subsidiaries
Subsidiaries are entities controlled by the Group. Control
exists when the Group has the power, directly or indirectly,
to govern the nancial and operating policies of an entity so
as to obtain benets from its activities. In assessing control,
potential voting rights that presently are exercisable or
convertible are taken into account. The nancial statements
of subsidiaries are included in the consolidated nancial
statements from the date that control commences until
the date that control ceases. The accounting policies of
subsidiaries have been changed when necessary to align
them with the policies adopted by the Group.
Investments in subsidiaries are carried at their cost of
acquisition in the Companys nancial statements.
Associates and joint ventures
Associates are those entities in which the Group has
signicant inuence, but not control, over the nancial and
operating policies. Joint ventures are those entities over
whose activities the Group has joint control, established by
contractual agreement and requiring unanimous consent for
strategic nancial and operating decisions. The consolidated
nancial statements include the Groups share of the total
recognised gains and losses of associates and joint ventures
on an equity accounted basis, from the date that signicant
inuence or joint control commences until the date that
signicant inuence or joint control ceases. When the
Groups share of losses exceeds its interest in an associate
or joint venture, the Groups carrying amount is reduced
to nil and recognition of further losses is discontinued
except to the extent that the Group has incurred legal or
constructive obligations or made payments on behalf of an
associate or joint venture.
Transactions eliminated on consolidation
Intra-group balances and any unrealised gains and losses or
income and expenses arising from intra-group transactions,
are eliminated in preparing the consolidated nancial
statements.
Unrealised gains arising from transactions with associates
and joint ventures are eliminated to the extent of the
Groups interest in the entity with adjustments made to
the Investments accounted for using the equity method
and Share of net prot of associates and joint ventures
accounted for using the equity method accounts.
3. SIGNIFICANT ACCOUNTING POLICIES continued
(b) Foreign currency
Foreign currency transactions
Transactions in foreign currencies are translated at the
foreign exchange rate ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign
currencies at the balance sheet date are translated to
Australian dollars at the foreign exchange rate ruling at that
date. Foreign exchange differences arising on translation
are recognised in the prot and loss statement, except
for differences arising on the translation of a nancial
liability designated as a hedge of the net investment in a
foreign operation or qualifying cash ow hedges, which are
recognised in other comprehensive income. Non-monetary
assets and liabilities that are measured in terms of historical
cost in a foreign currency are translated using the exchange
rate at the date of the transaction. Non-monetary assets
and liabilities denominated in foreign currencies that are
stated at fair value are translated to Australian dollars at
foreign exchange rates ruling at the dates the fair value
was determined.
Financial statements of foreign operations
The assets and liabilities of foreign operations, including
goodwill and fair value adjustments arising on
consolidation, are translated to Australian dollars at foreign
exchange rates ruling at the balance sheet date. The
revenues and expenses of foreign operations are translated
to Australian dollars at rates approximating the foreign
exchange rates ruling at the dates of the transactions.
Foreign exchange differences arising on retranslation are
recognised in other comprehensive income and presented
in the foreign currency translation reserve (FCTR). When
a foreign operation is disposed of, in part or in full, the
relevant amount in the FCTR is transferred to prot or
loss as part of the prot or loss on disposal. When the
settlement of a monetary item receivable from or payable
to a foreign operation is neither planned nor likely in the
foreseeable future, foreign exchange gains and losses
arising from such a monetary item are considered to
form part of a net investment in a foreign operation and
are recognised in other comprehensive income, and are
presented within equity in the FCTR.
Hedge of net investment in foreign operations
The Group applies hedge accounting to foreign currency
differences arising between the functional currency of
the foreign operation and the parent entitys functional
currency regardless of whether the net investments held
directly or through an intermediate parent. Foreign currency
differences arising on the retranslation of a nancial liability
designated as a hedge of a net investment in a foreign
operation are recognised in other comprehensive income,
in the foreign currency translation reserve, to the extent
that the hedge is effective. To the extent that the hedge is
ineffective, such differences are recognised in the prot and
loss statement. When the hedged part of a net investment
is disposed of, the associated cumulative amount in
equity is transferred to the prot and loss statement as an
adjustment to the gain or loss on disposal.
(c) Derivative nancial instruments
The Group uses derivative nancial instruments to hedge its
exposure to foreign exchange and interest rate risks arising
from operational, nancing and investment activities. In
accordance with its treasury policy, the Group does not
hold or issue derivative nancial instruments for trading
purposes. However, derivatives that do not qualify for
hedge accounting are accounted for as trading instruments.
On initial designation of the hedge, the Group formally
documents the relationship between the hedging
instrument(s) and hedged item(s), including the risk
management objectives and strategy in undertaking the
hedge transaction, together with the methods that will be
used to access the effectiveness of the hedging relationship.
The Group makes an assessment, both at the inception
of the hedge relationship as well as on an ongoing basis,
whether the hedging instruments are expected to be
highly effective in offsetting the changes in the fair value
or cash ows of the respective hedged items during the
period for which the hedge is designated, and whether the
actual results of each hedge are within a range of 80-125
percent. For a cash ow hedge of a forecast transaction, the
transaction should be highly probable to occur and should
present an exposure to variations in cash ows that could
ultimately affect reported net income.
Derivative nancial instruments are recognised initially
at fair value. Subsequent to initial recognition, derivative
nancial instruments are stated at fair value and changes
therein are recognised immediately in the prot and loss
statement. However, where derivatives qualify for hedge
accounting, recognition of any resultant gain or loss depends
on the nature of the item being hedged (see note 3(d)).
(d) Hedging
Cash ow hedges
Where a derivative nancial instrument is designated as
a hedge of the variability in cash ows of a recognised
asset or liability, or a highly probable forecast transaction,
the effective portion of any gain or loss on the derivative
nancial instrument is recognised in other comprehensive
income and presented in the hedging reserve in equity.
When the forecast transaction subsequently results in
the recognition of a non-nancial asset or non-nancial
liability, or the forecast transaction for a non-nancial asset
or non-nancial liability, the associated cumulative gain or
loss is transferred from other comprehensive income and
included in the initial cost or other carrying amount of the
non-nancial asset or liability. In other cases the amount
recognised in other comprehensive income is transferred to
the prot and loss statement in the same period that the
hedged item affects prot or loss.
(d) Hedging continued
The ineffective portion of any change in fair value is
recognised immediately in the prot and loss statement.
When a hedging instrument expires or is sold, terminated
or exercised, or the entity revokes designation of the
hedge relationship, but the hedged forecast transaction is
still expected to occur, the cumulative gain or loss at that
point remains in equity and is recognised in accordance
with the above policy when the transaction occurs. If the
hedged transaction is no longer expected to take place,
the cumulative unrealised gain or loss recognised in other
comprehensive income is recognised immediately in the
prot and loss statement.
Fair value hedges
Changes in the fair value of a derivative hedging instrument
designated as a fair value hedge are recognised in the prot
or loss. The hedged item also is stated at fair value in respect
of the risk being hedged; the gain or loss attributable to the
hedged risk is recognised in prot or loss with an adjustment
to the carrying amount of the hedged item.
Economic hedges
Where a derivative nancial instrument is not designated in
a qualifying hedge relationship, all changes in fair value are
recognised in the prot and loss statement.
(e) Property, plant and equipment
Owned assets
Items of property, plant and equipment are stated at cost
less accumulated depreciation (see below) and impairment
losses (see note 3(j)).
Cost includes expenditure that is directly attributable to the
acquisition of the asset. The cost of self-constructed assets
includes the cost of materials and direct labour, any other
costs directly attributable to bringing the asset to a working
condition for its intended use, the costs of dismantling and
removing the items and restoring the site on which they
are located, and capitalised borrowing costs (see below).
Cost also may include transfers from equity of any gain
or loss on qualifying cash ow hedges of foreign currency
purchases of property, plant and equipment. Purchased
software that is integral to the functionality of the related
equipment is capitalised as part of that equipment.
Where parts of an item of property, plant and equipment
have different useful lives, they are accounted for as
separate items of property, plant and equipment.
Gains and losses on disposal of an item of property, plant
and equipment are determined by comparing the proceeds
from disposal with the carrying amount of property, plant
and equipment and are recognised net within other
expenses in the prot and loss statement. When revalued
assets are sold, the amounts included in the revaluation
reserve are transferred to retained earnings.
Borrowing costs
The Group capitalises borrowing costs directly attributable
to the acquisition, construction or production of a qualifying
asset as part of the cost of that asset. All other borrowing
costs are recognised in the prot and loss using the
effective interest method.
Reclassication to investment property
When the use of a property changes from owner-occupied
to investment property, the property is held at cost and
reclassied as investment property.
Investment property
Investment property is property held either to earn rental
income or for capital appreciation or for both. Investment
property is measured at cost and is depreciated on a
straight line basis over the estimated useful life of 80 years.
Leased assets
Leases in terms of which the Group assumes substantially
all the risks and rewards of ownership are classied as
nance leases. Lease payments are accounted for as
described in note 3(q).
Subsequent costs
The Group recognises in the carrying amount of an item of
property, plant and equipment the cost of replacing part of
such an item when that cost is incurred if it is probable that
the future economic benets embodied within the item will
ow to the Group and the cost of the item can be measured
reliably. All other costs are recognised in the prot and loss
statement as an expense as incurred.
Depreciation
Depreciation is calculated on the depreciable amount,
which is the cost of an asset, or other amount substituted
for cost, less its residual value. Depreciation is charged
to the prot and loss statement on a straight-line or
diminishing value basis over the estimated useful lives of
each part of an item of property, plant and equipment. Land
is not depreciated. The estimated useful lives in the current
and comparative periods are as follows:
Buildings 20-40 Years
Plant and equipment 3-10 Years
Leasehold improvements 3-20 Years
Leased plant and equipment 4-5 Years
The residual value, the useful life and the depreciation
method applied to an asset are reassessed at least annually
and adjusted if appropriate.
(f) Trade and other receivables
Trade and other receivables are stated at their cost less
impairment losses (see note 3(j)).
(g) Inventories
Inventories are stated at the lower of cost and net realisable
value. Net realisable value is the estimated selling price in
the ordinary course of business, less the estimated costs of
completion and selling expenses.
The cost of inventories is based on the weighted average
method and includes expenditure incurred in acquiring the
inventories, production or conversion costs and other costs
incurred in bringing them to their existing location and
condition. In the case of manufactured inventories and work
in progress, cost includes an appropriate share of overheads
based on normal operating capacity.
Costs for sample testing commenced but not yet completed
in the analytical laboratory business are recognised as work
in progress and measured at the lower of cost to date and
net realisable value.
(h) Cash and cash equivalents
Cash and cash equivalents comprises cash balances and call
deposits. Bank overdrafts that are repayable on demand
and form an integral part of the Groups cash management
are included as a component of cash and cash equivalents
for the purpose of the statement of cash ows.
(i) Intangible assets
Goodwill
Goodwill arising on the acquisition of a subsidiary
or business is included in intangible assets. For the
accounting policy on measurement of the goodwill at initial
recognition, refer below.
Business combinations
Business combinations are accounted for using the
acquisition method as at the acquisition date, which is the
date on which control is transferred to the Group. Control
is the power to govern the nancial and operating policies
of an entity so as to obtain benets from its activities.
In assessing control, the Group takes into consideration
potential voting rights that currently are exercisable.
The Group measures goodwill at the acquisition date as:
the fair value of the consideration transferred; plus
the recognised amount of any non-controlling interests
in the acquiree; plus if the business combination is
achieved in stages, the fair value of the existing equity
interest in the acquiree; less
the net recognised amount (generally fair value) of the
identiable assets acquired and liabilities assumed.
When the excess is negative, a bargain purchase gain is
recognised immediately in prot and loss. The consideration
transferred does not include amounts related to the
settlement of pre-existing relationships. Such amounts are
generally recognised in prot or loss.

Transaction costs related to the acquisition, other than those
associated with the issue of debt or equity securities, that
the Group incurs in connection with a business combination
are expensed as incurred.
Any contingent consideration payable is recognised at fair
value at the acquisition date. If the contingent consideration
is classied as equity, it is not remeasured and settlement
is accounted for within equity. Otherwise, subsequent
changes to the fair value of the contingent consideration
are recognised in prot and loss. When share-based
payment awards (replacement awards) are required to be
exchanged for awards held by the acquirees employees
(acquirees awards) and relate to past services, then all or a
portion of the amount of the acquirers replacement awards
is included in measuring the consideration transferred in the
business combination. This determination is based on the
market-based value of the replacement awards compared
with the market-based value of the acquirees awards and
the extent to which the replacement awards relate to past
and/or future service.
In determining the fair value of identiable net assets
acquired, the Group considers the existence of identiable
intangible assets such as brandnames, trademarks,
customer contracts and relationships and in process research
and development intangible assets. Where material, these
items are recognised separately from goodwill.
Acquisitions of non-controlling interests
Acquisitions of non-controlling interests are accounted for
as transactions with owners in their capacity as owners
and therefore no goodwill is recognised as a result of such
transactions. The adjustments to non-controlling interests
are based on a proportionate amount of the net assets of
the subsidiary.
Subsequent measurement
Goodwill is measured at cost less accumulated impairment
losses. In respect of equity accounted investees, the
carrying amount of goodwill is included in the carrying
amount of the investment.
Other intangible assets
Other intangible assets that are acquired by the Group are
stated at cost less accumulated amortisation (see below)
and impairment losses (see note 3(j)).
Expenditure on internally generated goodwill and brands is
recognised in the prot and loss statement as an expense
as incurred.
Subsequent expenditure
Subsequent expenditure on capitalised intangible assets
is capitalised only when it increases the future economic
benets embodied in the specic asset to which it relates.
All other expenditure is expensed as incurred.
(i) Intangible assets continued
Amortisation
Amortisation is calculated on the cost of an asset less its
residual value. Amortisation is charged to the prot and loss
statement on a straight-line basis over the estimated useful
lives of intangible assets unless such lives are indenite.
Goodwill and intangible assets with an indenite useful life
are systematically tested for impairment at each balance
sheet date. Other intangible assets are amortised from the
date they are available for use. The estimated useful lives in
the current and comparative periods are as follows:
Capitalised computer software 3-10 Years
The residual value, the useful life and the amortisation
method applied to an asset are reassessed at least annually
and adjusted if appropriate.
(j) Impairment
Financial assets
A nancial asset is assessed at each reporting date to
determine whether there is any objective evidence that it
is impaired. A nancial asset is considered to be impaired if
objective evidence indicates that one or more events have
had a negative effect on the estimated future cash ows of
that asset.
An impairment loss in respect of a nancial asset measured
at amortised cost is calculated as the difference between
its carrying amount, and the present value of the estimated
future cash ows discounted at the original effective
interest rate. An impairment loss in respect of an available-
for-sale nancial asset is calculated by reference to its fair
value.
Individually signicant nancial assets are tested for
impairment on an individual basis. The remaining nancial
assets are assessed collectively in groups that share similar
credit risk characteristics.
All impairment losses are recognised in the prot and loss
statement.
An impairment loss is reversed if the reversal can be related
objectively to an event occurring after the impairment loss
was recognised. For nancial assets measured at amortised
cost, the reversal is recognised in the prot and loss
statement.
Non-nancial assets
The carrying amounts of the Groups non-nancial assets,
other than inventories (see note 3(g)) and deferred tax
assets (see note 3(s)), are reviewed at each balance
sheet date to determine whether there is any indication
of impairment. If any such indication exists, the assets
recoverable amount is estimated (see Calculation of
recoverable amount below). For goodwill, assets that have
an indenite useful life and intangible assets that are not
yet available for use, the recoverable amount is estimated
at each balance sheet date.
An impairment loss is recognised whenever the carrying
amount of an asset or its cash-generating unit exceeds its
recoverable amount. Impairment losses are recognised in
the prot and loss statement, unless an asset has previously
been revalued, in which case the impairment loss is
recognised as a reversal to the extent of that previous
revaluation with any excess recognised through the prot
and loss statement.
Impairment losses recognised in respect of cash-generating
units are allocated rst to reduce the carrying amount of
any goodwill allocated to cash-generating units (group of
units) and then, to reduce the carrying amount of the other
assets in the unit (group of units) on a pro rata basis.
Goodwill that forms part of the carrying amount of an
investment in equity accounted investees is not recognised
separately, and therefore is not tested for impairment
separately. Instead, the entire amount of the investment
is tested for impairment as a single asset when there is
objective evidence that the investment may be impaired.
Calculation of recoverable amounts
Impairment of receivables is not recognised until objective
evidence is available that a loss event has occurred.
Receivables are individually assessed for impairment.
The recoverable amount of other assets is the greater
of their fair value less costs to sell and value in use. In
assessing value in use, the estimated future cash ows are
discounted to their present value using a pre-tax discount
rate that reects current market assessments of the time
value of money and the risks specic to the asset. For an
asset that does not generate largely independent cash
inows, the recoverable amount is determined for the cash-
generating unit to which the asset belongs. The goodwill
acquired in a business combination, for the purpose of
impairment testing, is allocated to cash-generating units
that are expected to benet from the synergies of the
combination.
(k) Share capital
Transaction costs
Transaction costs of an equity transaction are accounted for
as a deduction from equity, net of any related income tax
benet.
Dividends
Dividends are recognised as a liability in the period in which
they are declared.
(l) Loans and borrowings
Interest-bearing borrowings are recognised initially at fair
value less attributable transaction costs. Subsequent to
initial recognition, interest-bearing borrowings are stated
at amortised cost with any difference between cost and
redemption value being recognised in the prot and loss
statement over the period of the borrowings on an effective
interest basis.
(m) Employee benets
Dened contribution superannuation funds
Obligations for contributions to dened contribution
superannuation funds are recognised as an expense in the
prot and loss statement as incurred.
Long-term service benets
The Groups net obligation in respect of long-term service
benets is the amount of future benet that employees
have earned in return for their service in the current and
prior periods. The obligation is calculated using expected
future increases in wage and salary rates including
related on-costs and expected settlement dates, and is
discounted using the rates attached to government bonds
at the balance sheet date which have maturity dates
approximating the terms of the Groups obligations.
Wages, salaries, annual leave and sick leave
Liabilities for employee benets for wages, salaries,
annual leave and sick leave that are expected to be settled
within 12 months of the reporting date represent present
obligations resulting from employees services provided
to reporting date, are calculated at undiscounted amounts
based on remuneration wage and salary rates that the
Group expects to pay as at reporting date including related
on-costs, such as workers compensation insurance and
payroll tax.
Share-based payment transactions
The fair value at grant date of equity-settled share-based
awards granted to employees is recognised as an employee
expense, with a corresponding increase in equity, over the
period that the employees become unconditionally entitled
to the awards. The amount recognised as an expense is
adjusted to reect the actual number of share awards that
vest, except for those that fail to vest due to market vesting
conditions not being met.
The fair value of the amount payable to employees in
respect of cash-settled share-based awards is recognised as
an expense, with a corresponding increase in liabilities, over
the period in which the employees become unconditionally
entitled to payment. The liability is re-measured at each
reporting date and at settlement date. Any changes in
the fair value of the liability are recognised as employee
expenses in prot or loss.
(n) Provisions
A provision is recognised in the balance sheet when the
Group has a present legal or constructive obligation as a
result of a past event, and it is probable that an outow of
economic benets that can be estimated reliably will be
required to settle the obligation. If the effect is material,
provisions are determined by discounting the expected
future cash ows at a pre-tax rate that reects current
market assessments of the time value of money and,
where appropriate, the risks specic to the liability. The
unwinding of the discount is recognised as a nance cost.
(o) Trade and other payables
Trade and other payables are stated at their amortised cost.
Trade payables are non-interest bearing and are normally
settled on 60-day terms.
(p) Revenue
Goods sold and services rendered
Revenue from the sale of goods is recognised in the prot
and loss statement when the signicant risks and rewards
of ownership have been transferred to the buyer. Revenue
from services rendered is recognised in the prot and
loss statement in proportion to the stage of completion
of the transaction at the balance sheet date. The stage of
completion is assessed by reference to surveys of work
performed. No revenue is recognised if there are signicant
uncertainties regarding recovery of the consideration due,
the costs incurred or to be incurred cannot be measured
reliably, there is a risk of return of goods or there is
continuing management involvement with the goods.
Transfers of risk and rewards vary depending on the
individual terms of the contract of sale. For the majority of
the Groups sale of goods, transfer usually occurs when the
product is delivered.
Dividend Income
Dividend income is recognised in prot and loss on the date
that the Groups right to receive payment is established.
(q) Expenses
Operating lease payments
Payments made under operating leases are recognised in
the prot and loss statement on a straight-line basis over the
term of the lease. Lease incentives received are recognised in
the prot and loss statement as an integral part of the total
lease expense and spread over the lease term.
Finance lease payments
Minimum lease payments are apportioned between the
nance charge and the reduction of the outstanding liability.
The nance charge is allocated to each period during the
lease term so as to produce a constant periodic rate of
interest on the remaining balance of the liability.
Finance income and nance expense
Finance income comprises interest income on funds
invested and is recognised in the prot and loss statement
as it accrues, using the effective interest method.
Finance expense comprise interest expense on borrowings
calculated using the effective interest method and gains
and losses on hedging instruments that are recognised
in the prot and loss statement (see note 3(d)). The
interest expense component of nance lease payments
is recognised in the prot and loss statement using the
effective interest method.
Foreign currency costs
Foreign currency gains and losses are reported on a net
basis.
(r) Determination and presentation of operating segments
The Group determines and presents operating segments
based on information that is reported internally to the Chief
Executive Ofcer (CEO), who is the Groups chief operating
decision maker.
An operating segment is a component of the Group that
engages in business activities from which it may earn
revenues and incur expenses, including revenues and
expenses that relate to transactions with any of the Groups
other components. An operating segments operating
results are reviewed regularly by the CEO to make decisions
about resources to be allocated to the segment and to
assess its performance, and for which discrete nancial
information is available.
Segment results that are reported to the CEO include items
directly attributed to the segment as well as those that can
be allocated on a reasonable basis. Segment contribution
is calculated as earnings before interest, foreign currency
gains and losses, unusual items (refer note 9) and income
tax. Unallocated items comprise mainly corporate assets,
head ofce expenses, nance costs, income tax expense
and taxation assets and liabilities. Inter-segment pricing is
determined on an arms length basis.
Non-current assets disclosed in note 6 Operating
Segments - are comprised of the Groups non-current assets
excluding receivables and deferred tax assets.
(s) Income tax
Income tax on the prot or loss for the year comprises
current and deferred tax. Income tax is recognised in
the prot and loss statement except to the extent that
it relates to items recognised directly in equity or other
comprehensive income, in which case it is recognised in
equity or other comprehensive income, respectively.
Current tax is the expected tax payable on the taxable
income for the year, using tax rates enacted or substantially
enacted at the balance sheet date, and any adjustment to
tax payable in respect of previous years.
Deferred tax is provided using the balance sheet method,
providing for temporary differences between the carrying
amounts of assets and liabilities for nancial reporting
purposes and the amounts used for taxation purposes. The
following temporary differences are not provided for: initial
recognition of goodwill, the initial recognition of assets or
liabilities that affect neither accounting nor taxable prot,
and differences relating to investments in subsidiaries to the
extent that they will probably not reverse in the foreseeable
future. The amount of deferred tax provided is based on the
expected manner of realisation or settlement of the carrying
amount of assets and liabilities, using tax rates enacted or
substantively enacted at the balance sheet date.
A deferred tax asset is recognised only to the extent that
it is probable that future taxable prots will be available
against which the asset can be utilised. Deferred tax assets
are reviewed at each reporting date and are reduced to
the extent that it is no longer probable that the related tax
benet will be realised.
Additional income taxes that arise from the distribution of
dividends are recognised at the same time as the liability to
pay the related dividend.
Tax consolidation
The Company and its wholly-owned Australian resident
entities have formed a tax-consolidated group with effect
from 1 April 2003 and are therefore taxed as a single entity
from that date. The head entity within the tax-consolidated
group is Campbell Brothers Limited.
Current tax expense/income, deferred tax liabilities and
deferred tax assets arising from temporary differences of
the members of the tax-consolidated group are recognised
in the separate nancial statements of the members of the
tax-consolidated group using the separate taxpayer within
group approach by reference to the carrying amounts in
the separate nancial statements of each entity and the tax
values applying under tax consolidation.
Any current tax liabilities (or assets) and deferred tax
assets arising from unused tax losses of the subsidiaries
is assumed by the head entity in the tax consolidated
group and are recognised as amounts payable (receivable)
to (from) other entities in the tax-consolidated group in
conjunction with any tax funding arrangement amounts
(refer below). Any difference between these amounts is
recognised by the Company as an equity contribution or
distribution.
The Company recognises deferred tax assets arising from
unused tax losses of the tax-consolidated group to the
extent that it is probable that future taxable prots of the
tax-consolidated group will be available against which the
asset can be utilised.
Any subsequent period adjustments to deferred tax
assets arising from unused tax losses as a result of
revised assessments of the probability of recoverability is
recognised by the head entity only.
Nature of tax funding arrangements
The head entity, in conjunction with other members of
the tax-consolidated group, has entered into a tax funding
arrangement which sets out the funding obligations of
members of the tax-consolidated group in respect of tax
amounts. The tax funding arrangements require payments
to/from the head entity equal to the current tax liability
(asset) assumed by the head entity and any tax-loss
deferred tax asset assumed by the head entity, resulting
in the head entity recognising an inter-entity payable
(receivable) equal in amount to the tax liability (asset)
assumed. The inter-entity payables (receivables) are at call.
Contributions to fund the current tax liabilities are payable
as per the tax funding arrangement and reect the timing
of the head entitys obligation to make payments for tax
liabilities to the relevant tax authorities.
(t) Goods and services tax
Revenue, expenses and assets are recognised net of the
amount of goods and services tax (GST), except where the
amount of GST incurred is not recoverable from the taxation
authority. In these circumstances, the GST is recognised as
part of the cost of acquisition of the asset or as part of the
expense.
Receivables and payables are stated with the amount of
GST included. The net amount of GST recoverable from, or
payable to, the taxation authority is included as a current
asset or liability in the balance sheet.
Cash ows are included in the statement of cash ows on a
gross basis. The GST components of cash ows arising from
investing and nancing activities which are recoverable
from, or payable to, the taxation authority are classied as
operating cash ows.
(u) Discontinued operations
A discontinued operation is a component of the Groups
business that represents a separate major line of business
or geographical area of operations that has ceased or
been disposed of or is held for sale. Classication as a
discontinued operation occurs upon cessation or disposal.
When an operation is classied as a discontinued operation,
the comparative prot and loss statement and statement of
comprehensive income are restated as if the operation had
been discontinued from the start of the comparative period.
(v) Earnings per share
The Group presents basic and diluted earnings per share
(EPS) data for its ordinary shares. Basic EPS is calculated
by dividing the prot or loss attributable to ordinary
shareholders of the Company by the weighted average
number of ordinary shares outstanding during the period.
Diluted EPS is determined by adjusting the prot or loss
attributable to ordinary shareholders and the weighted
average number of ordinary shares outstanding for the
effects of all dilutive potential ordinary shares, which
comprise performance rights granted to employees.
(w) Removal of parent entity nancial statements
The Group has applied amendments to the Corporations Act
(2001) that remove the requirement for the Group to lodge
parent entity nancial statements. Parent entity nancial
statements have been replaced by the specic parent entity
disclosures in note 31.
(x) New standards and interpretations not yet adopted
A number of new standards, amendments to standards and
interpretations are effective for annual periods beginning
after 1 April 2012, and have not been applied in preparing
these consolidated nancial statements. None of these is
expected to have a signicant effect on the consolidated
nancial statements of the Group, except for IFRS 9
Financial Instruments, which becomes mandatory for the
Groups 2014 consolidated nancial statements and could
change the classication and measurement of nancial
assets. The Group does not plan to adopt this standard early
and the extent of the impact has not been determined.
4. FINANCIAL AND CAPITAL RISK MANAGEMENT
Risk management framework
Identication, measurement and management of risk is
a strategic priority for the Group. The provision of goods
and services carries a number of diverse risks which may
have a material impact on the Groups nancial position
and performance. Consequently, the Board has established
a comprehensive framework covering accountability,
oversight, measurement and reporting to maintain high
standards of risk management throughout the Group.
The Group allocates specic roles in the management of
risk to executives and senior managers and to the Board.
This is undertaken within an overall framework and strategy
established by the Board.
The Audit and Compliance Committee obtains assurance
about the internal control and risk management
environment through regular reports from the Risk and
Compliance team.
The Group has exposure to the following risks from their
use of nancial instruments:
Credit risk
Liquidity risk
Market risk
This note presents information about the Groups exposure
to each of the above risks, the Groups objectives, policies
and processes for measuring and managing risk, and the
Groups management of capital.
Credit risk
The Group has an established credit policy and the exposure
to credit risk is monitored on an ongoing basis. Credit
evaluations are performed on all customers requiring
credit over a certain amount. The Group does not require
collateral in respect of nancial assets. There is no single
customer making up a material percentage of the Groups
revenue. Geographic concentrations of trade receivables are
- Australia 46% (2011: 54%), Canada 12% (2011: 10%) and
other countries 42% (2011: 36%). The maximum exposure
to credit risk is represented by the carrying amount of each
nancial asset, including derivative nancial instruments, in
the balance sheet.
Goods are sold subject to retention of title clauses, so that
in the event of non-payment the Group may have a secured
claim. The Group does not require collateral in respect of
trade and other receivables.
Counterparties to transactions involving derivative nancial
instruments are large Australian and international banks
with whom the Group has a signed netting agreement.
Management does not expect any counterparty to fail to
meet its obligations.
Group policy is to provide nancial guarantees only to
wholly-owned subsidiaries. Details of the Deed of Cross
Guarantee are provided in note 30.
4. FINANCIAL AND CAPITAL RISK MANAGEMENT continued
Liquidity risk
The liquidity position of the Group is continuously managed
using cash ow forecasts to ensure sufcient liquid funds
are available to meet its nancial commitments in a timely
and cost-effective manner. The Group is party to a number
of bilateral debt facility and long term note agreements
which provide funding for acquisitions and working capital
(refer note 24).
Note 26 details the repayment obligations in respect of the
amount of the facilities and derivatives utilised.
Market risk
Interest rate risk
Interest rate risk is the risk that the Groups nancial
position and performance will be adversely affected by
movements in interest rates. Interest rate risk on cash and
short term deposits is not considered to be a material risk
due to the short term nature of these nancial instruments.
The Groups interest rate risk arises from long-term debt.
Floating rate debt exposes the Group to cash ow interest
rate risk and xed rate debt exposes the Group to fair
value interest rate risk. Interest rate risk is managed by
maintaining an appropriate mix of xed and oating rate
debt. The Group enters into interest rate swaps to manage
the ratio of xed rate debt to oating rate debt. Hedging
is undertaken against specic rate exposures only, as
disclosed in note 26.
Foreign exchange risk
The Group operates internationally and are exposed
to foreign exchange risk arising from various currency
exposures.
Foreign exchange risk arises from future purchase and
sales commitments and assets and liabilities that are
denominated in a currency that is not the functional
currency of the respective Group entities. Measuring the
exposure to foreign exchange risk is achieved by regularly
monitoring and performing sensitivity analysis on the
Groups nancial position.
The Group may enter into forward foreign exchange
contracts (FECs) to hedge certain forecast purchase
commitments denominated in foreign currencies
(principally US dollars). The terms of these commitments
are generally less than three months. The amount of
forecast purchases is estimated based on current conditions
in foreign markets, customer orders, commitments to
suppliers and experience.
The Group borrows funds in foreign currencies to hedge its
net investments in foreign operations. The Groups Canadian
dollar, Great British pound and Swedish kronor denominated
borrowings are designated as hedges of the Groups net
investments in subsidiaries with those functional currencies.
The Group has also entered into cross currency interest
rate swaps which have been designated as hedges of
net investments in foreign operations whose functional
currencies are Canadian dollars, Czech koruna, and Euros.
Capital management
Capital comprises equity attributable to equity holders,
loans and borrowings and cash and cash equivalents.
Capital management involves the use of corporate
forecasting models which facilitates analysis of the Groups
nancial position including cash ow forecasts to determine
the future capital management requirements. Capital
management is undertaken to ensure a secure, cost-
effective and exible supply of funds is available to meet
the Groups operating and capital expenditure requirements.
The Group monitors gearing and treasury policy breaches
and exceptions. The gearing ratio as at balance date is 28%
(2011: 12%).
The Group maintains a stable capital base from which it can
pursue its growth aspirations, whilst maintaining a exible
capital structure that allows access to a range of debt and
equity markets to both draw upon and repay capital.
5. DETERMINATION OF FAIR VALUE
The following summarises the major methods and
assumptions used in estimating the fair values for
measurement and disclosure purposes:
Fair value hierarchy
In valuing nancial instruments, the Group uses the
following fair value measurement hierarchy that reects
the signicance of the inputs used in making the
measurements:
Level 1: Quoted market price (unadjusted) in an active
market for an identical instrument.
Level 2: Valuation techniques based on observable inputs,
either directly (i.e. as prices) or indirectly (i.e. derived
from prices).
Level 3: Valuation techniques using signicant
unobservable inputs. This category includes all
instruments where the valuation technique includes
inputs not based on observable data and the
unobservable inputs have a signicant effect on the
instruments valuation.
Derivatives
Forward exchange contracts are marked to market using
publicly available forward rates. Interest rate contracts are
marked to market using discounted estimated future cash
ows based on the terms and maturity of each contract and
using market interest rates for a similar instrument at the
measurement date.
Where discounted cash ow techniques are used, estimated
future cash ows are based on managements best
estimates and the discount rate is a market related rate
for a similar instrument at the balance sheet date. Where
other pricing models are used, inputs are based on market
related data at the balance sheet date.
5. DETERMINATION OF FAIR VALUE continued
Loans and borrowings
Fair value is calculated based on discounted expected future
principal and interest cash ows.
Trade and other receivables / payables
For receivables / payables with a remaining life of less than
one year, the notional amount is deemed to reect the fair
value. All other receivables / payables are discounted to
determine the fair value.
Finance leases
The fair value is estimated as the present value of
future cash ows, discounted at market interest rates for
homogenous lease agreements. The estimated fair value
reects changes in interest rates.
Share-based payment transactions
The fair value of share-based awards to employees is
measured using Binomial Tree (Earnings per Share hurdle)
and Monte-Carlo Simulation (Total Shareholder Return
hurdle) valuation methodologies. Measurement inputs
include the Companys share price on measurement date,
expected volatility thereof, expected life of the awards,
the Companys expected dividend yield and the risk-
free interest rate. Service and non-market performance
conditions attached to the transactions are not taken into
account in determining fair value. Refer note 37 for details.
Contingent consideration
The fair value of contingent consideration is calculated
using the income approach based on the expected
payment amounts and their associated probabilities. When
appropriate, it is discounted to present value.
6. OPERATING SEGMENTS
The Group has 6 reportable segments, as described below,
which are the Groups strategic business units. The strategic
business units offer different products and services, and
are managed separately. For each of the strategic business
units, the CEO reviews internal management reports on at
least a monthly basis. The following summary describes the
operations in each of the Groups reportable segments:
ALS Minerals - provides assaying and analytical testing
services and metallurgical services for mining and
mineral exploration companies.
ALS Life Sciences (formerly ALS Environmental) -
provides analytical testing data to assist consulting and
engineering rms, industry, and governments around
the world in making informed decisions about their
environmental projects.
ALS Energy (formerly ALS Coal) - provides specialist
services to the coal industry such as coal sampling &
analysis and certication of export cargoes.
ALS Industrial provides the energy, resources and
infrastructure sectors with testing, inspection, asset
care services and analysis of lubricating oil from a
wide variety of mechanical equipment for preventative
maintenance purposes.
Campbell Chemicals - manufacture and distribution of
cleaning agents and chemicals for both domestic and
industrial customers.
Reward Distribution - distribution of non-food
consumables to the healthcare, building services,
hospitality and leisure industries.

In thousands of AUD
ALS
Minerals
ALS
Life Sciences
(a)
ALS
Energy
(b)
ALS
Industrial
(c)
Campbell
Chemicals
Reward
Distribution
Consolidated
2012
Revenue from external customers 591,338 360,661 87,848 152,532 90,056 123,174 1,405,609
Inter-segment revenue - - - - - - -
Total revenue 591,338 360,661 87,848 152,532 90,056 123,174 1,405,609
Segment contribution (f) 214,655 78,110 23,720 24,453 8,124 3,664 352,726
Segment margin (g) 36.3% 21.7% 27.0% 16.0% 9.0% 3.0% 25.1%
Segment assets 640,682 382,028 138,347 189,124 44,901 52,395 1,447,477
Segment liabilities 56,275 41,740 17,093 24,198 7,571 13,156 160,033
Amortisation and depreciation 18,571 17,804 2,874 4,341 692 834 45,116
(a) Segment formerly disclosed as ALS Environmental
(b) Segment formerly disclosed as ALS Coal
(c) ALS Industrial segment disclosed above is an amalgamation of the former ALS Tribology and ALS Industrial segments
(d) Campbell Chemicals 2011 segment revenue includes $42,503,000 relating to the chemical and cleaning solutions business which was divested on 1 December 2010.
(e) Intersegment revenue is generated by Campbell Chemicals from sales to other segments.
(f) Segment contribution represents the segments prot before unusual items, nancing costs, net foreign exchange gains and losses and income tax.
(g) Segment margin is calculated as segment contribution as a percentage of segment revenue.

In thousands of AUD
ALS
Minerals
ALS
Life Sciences
(a)
ALS
Energy
(b)
ALS
Industrial
(c)
Campbell
Chemicals
(d)
Reward
Distribution Consolidated
2011
Revenue from external customers 334,477 308,281 73,023 142,372 126,307 123,869 1,108,329
Inter-segment revenue (e) - - - - 4,015 - 4,015
Total revenue 334,477 308,281 73,023 142,372 130,322 123,869 1,112,344
Segment contribution (f) 111,796 66,195 17,151 16,617 7,386 (1,811) 217,334
Segment margin (g) 33.4% 21.5% 23.5% 11.7% 5.7% (1.5%) 19.5%
Segment assets 338,125 332,386 130,312 152,472 44,684 53,529 1,051,508
Segment liabilities 38,763 35,265 16,881 14,561 6,734 13,084 125,288
Amortisation and depreciation 15,454 15,509 2,745 3,989 2,399 1,221 41,317
6. OPERATING SEGMENTS continued
Consolidated
In thousands of AUD 2012 2011
i) Segment revenue reconciliation to the prot and loss statement
Total segment revenue 1,405,609 1,112,344
Inter-segment sales eliminations - (4,015)
Total Revenue 1,405,609 1,108,329
Consolidated
ii) Segment contribution reconciliation to the prot and loss statement
Total segment contribution 352,726 217,334
Unusual items (refer note 9) - (751)
Corporate expenses (21,758) (18,374)
Acquisition expenses (3,387) (2,840)
Net nancing costs (15,623) (10,244)
Net prot before tax per the prot and loss statement 311,958 185,125
Consolidated
iii) Segment assets reconciliation to the balance sheet
Total segment assets 1,447,477 1,051,508
Corporate assets 13,057 14,559
Cash and cash equivalents 133,354 87,123
Fair value derivatives 4,021 1,244
Other current assets 24,649 4,118
Deferred tax assets 13,156 13,395
Total assets per the balance sheet 1,635,714 1,171,947
6. OPERATING SEGMENTS continued
Consolidated
iv) Segment liabilities reconciliation to the balance sheet
Total segment liabilities 160,033 125,288
Corporate liabilities 11,305 7,280
Bank overdraft 1,161 3,135
Fair value derivatives - -
Income tax liability 28,474 13,581
Loans and borrowings 502,841 195,462
Deferred tax liabilities 1,696 1,681
Total liabilities per the balance sheet 705,510 346,427
Consolidated
v) Segment amortisation and depreciation reconciliation to the prot and loss statement
Total segment amortisation and depreciation 45,116 41,317
Corporate amortisation and depreciation 1,083 855
Total amortisation and depreciation 46,199 42,172
Geographical segments
In presenting information on a geographical basis segment revenue from external customers is by geographical location of customers.
Segment assets are attributed based on geographic location of the business unit.
Consolidated
Revenues Non-current assets Revenues Non-current assets
Australia 658,734 587,888 591,194 527,381
Canada 236,545 240,300 171,240 96,262
Other countries 510,330 301,428 349,910 173,413
Total 1,405,609 1,129,616 1,112,344 797,056
7. OTHER INCOME
Note Consolidated
Gain on sale of chemical and cleaning solutions business 9 - 8,654
Dividend income - 567
Other income 1,851 1,720
1,851 10,941
8. EXPENSES
Note Consolidated
Cost of goods sold 190,640 174,928
Equity-settled share-based payment transactions 37 1,240 975
Cash-settled share-based payment transactions 37 1,035 590
Contributions to dened contribution post-employment plans 30,112 24,911
Loss/(gain) on sale of property plant and equipment (111) 389
Impairment of goodwill relating to Reward Distribution segment 9, 21 - 7,857
Write down of inventory in Reward Distribution segment to net realisable value 9 - 1,548
Transaction costs related to business combinations 3(i) 3,387 2,840
Net loss/(gain) on foreign exchange (2,879) 1,807
9. UNUSUAL ITEMS RECORDED IN PROFIT FOR THE YEAR
Note Consolidated
Gain on sale of chemical and cleaning solutions business 7 - 8,654
Write-down to recoverable amount goodwill and inventories in Reward Distribution segment 8 - (9,405)
- (751)
Income tax effect - 897
Effect of unusual items after income tax - 146
10. AUDITORS REMUNERATION
Consolidated
In AUD 2012 2011
Audit services
Auditors of the Company
KPMG Australia:
Audit and review of consolidated and company nancial reports * 484,000 451,000
Audit of subsidiarys nancial report 40,000 45,000
Other regulatory audits 4,500 4,200
Audit and review of nancial reports* 672,693 383,352
1,201,193 883,552
Other auditors
Audit and review of nancial reports 106,646 69,913
1,307,839 953,465
Other services
Auditors of the company
KPMG Australia
Other assurance and investigation services 22,364 52,750
Taxation services 136,266 65,974
Other assurance and investigation services 72,146 737
230,776 119,461
* Includes impact of acquisitions during the nancial year.
11. NET FINANCING COSTS
Consolidated
Interest income 1,788 1,053
Financial income 1,788 1,053
Interest expense 17,130 10,751
Finance charges on capitalised leases 281 546
Financial expenses 17,411 11,297
Net nancing costs 15,623 10,244
12. INCOME TAX EXPENSE
Consolidated
Recognised in the prot and loss statement
Current tax expense
Current year 82,719 50,845
Adjustments for prior years (363) 537
82,356 51,382
Deferred tax expense
Origination and reversal of temporary differences 4,915 1,453
4,915 1,453
Total income tax expense in prot and loss statement 87,271 52,835
Reconciliation between tax expense and pre-tax net prot
Prot before tax 311,958 185,125
Income tax using the domestic corporation tax rate of 30% (2011: 30%) 93,587 55,537
Difference resulting from different tax rates in overseas countries (5,853) (2,045)
Increase in income tax expense due to:
Non-deductible expenses 731 250
Non-deductible equity settled performance rights expense 145 195
Non-deductible new market expansion and acquisition related costs 353 445
Tax losses of subsidiaries not recognised 1,456 1,502
Non resident withholding tax paid upon receipt of distributions from foreign related parties 3,416 1,746
Non-deductible goodwill impairment losses - 2,367
Non-deductible unrealised foreign exchange amounts 1,014 -
Decrease in income tax expense due to:
Previously unrecognised tax losses utilised during the year (732) (558)
Deductible WIP balances acquired - (600)
Share of associate entities net prot (415) (145)
Foreign statutory tax exemptions granted (890) (1,561)
Tax exempt revenues (1,123) (1,076)
Net tax adjustment attributable to the disposal of the Cleantec business - (3,106)
Other deductible items (4,055) (653)
Under / (over) provided in prior years (363) 537
Income tax expense on pre-tax net prot 87,271 52,835
12. INCOME TAX EXPENSE continued
Consolidated
Deferred tax recognised directly in equity
Relating to foreign currency translation reserve (1,206) 37
Relating to hedging reserve - (874)
(1,206) (837)
13. EARNINGS PER SHARE
Consolidated
Cents per share 2012 2011
Basic earnings per share 329.48 203.19
Diluted earnings per share 328.82 202.78
Basic and diluted earnings per share
The calculations of both basic and diluted earnings per share were based on the prot attributable to equity holders of the Company of
$222,413,000 (2011: $132,354,000).
Weighted average number of ordinary shares (Basic and diluted)
Consolidated
In thousands of shares 2012 2011
Issued ordinary shares at 1 April 25 67,503 62,960
Effect of shares issued July 2010 (DRP *) - 557
Effect of shares issued November and December 2010 (in connection with acquisition of Ammtec Ltd) - 1,378
Effect of shares issued December 2010 (DRP *) - 244
Weighted average number of ordinary shares at 31 March (Basic) 67,503 65,139
Effect of performance rights granted to employees as compensation 136 134
Weighted average number of ordinary shares at 31 March (Diluted) 67,639 65,273
* DRP: Dividend Reinvestment Plan. The DRP was suspended following payment of the interim dividend in December 2010.
14. CASH AND CASH EQUIVALENTS
Consolidated
Bank balances 91,931 84,323
Call deposits - 2,800
Cash held in trust* 41,423 -
Cash and cash equivalents in the balance sheet 133,354 87,123
Bank overdrafts repayable on demand (1,161) (3,135)
Cash and cash equivalents in the statement of cash ows 132,193 83,988
The Groups exposure to interest rate risk and a sensitivity analysis for nancial assets and liabilities are disclosed in note 26.
* Held in trust in connection with the Groups acquisition of Eclipse Scientic Group Limited and Advanced Micro Services, refer note 38.
15. TRADE AND OTHER RECEIVABLES
Consolidated
Current
Trade receivables 245,888 169,847
Other receivables 17,674 22,393
Fair value derivatives 4,021 1,244
267,583 193,484
Non-current
Finance lease receivable - 2,250
Security deposits 797 1,706
Loans owing by associates and joint venture 1,257 953
2,054 4,909
Ageing of trade receivables
Current 128,255 96,508
30 days 62,245 43,243
60 days 22,654 14,129
90 days and over 38,242 23,542
Total 251,396 177,422
Allowance for impairment of trade receivables
Opening balance 7,575 8,237
Impairment loss recognised/(reversal of impairment loss) (2,067) (662)
Closing balance 5,508 7,575
Based on historical rates of default, the Group believes that no impairment allowance is necessary in respect of trade receivables not overdue or
past due not more than two months. The allowance for impairment of trade receivables is in respect of trade receivables past due for more than
two months.
Exposures to currency risks related to trade and other receivables are disclosed in note 26.
16. INVENTORIES
Consolidated
Raw materials and consumables 20,603 13,791
Work in progress 29,570 20,450
Finished goods 30,339 29,878
80,512 64,119
17. OTHER CURRENT ASSETS
Consolidated
Prepayments 14,543 9,599
Other 10,106 2,262
24,649 11,861
18. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
Name Principal activities
2012 Reporting date Ownership interest
Consolidated
Associates: 2012 2011
ALS Technichem (Malaysia) Snd Bhd Laboratory services 31 December 40% 40%
Joint ventures:
ALS Mineralogy Pty Ltd (a) Laboratory services 31 March 100% 51%
Australian Laboratory Services, Arabia Co. Laboratory services 31 December 42% 42 %
Alex Stewart Assayers (S) Pte Ltd (b) Laboratory services 31 March 100% 50%
(a) The Group acquired the remaining 49% ownership interest in ALS Mineralogy Pty Ltd effective 30 March 2012. Prior to this date the Group accounted for this
investment using the equity method because the shareholders agreement between the Group and the other shareholder operated such that key strategic decisions
were made jointly.
(b) The Group acquired the remaining 50% ownership interest in Alex Stewart Assayers (S) Pte Ltd effective 1 July 2011. Prior to this date the Group accounted for this
investment using the equity method.
Consolidated
Movements in carrying amount of investments in associates and joint ventures:
Carrying amount at the beginning of the nancial year 17,134 19,261
Investment in joint venture - -
Share of associates and joint ventures net prot 1,384 243
Dividends received (510) (2,370)
Reduction in carrying value upon becoming a wholly owned subsidiary (7,127) -
10,881 17,134
19. DEFERRED TAX ASSETS AND LIABILITIES
Recognised deferred tax assets and liabilities
Deferred tax assets and liabilities are attributable to the following:
Assets Liabilities Net
In thousands of AUD 2012 2011 2012 2011 2012 2011
Property, plant and equipment 3,078 2,615 2,483 1,786 595 829
Land and buildings - 81 692 1,222 (692) (1,141)
Intangible assets - - 1,043 1,038 (1,043) (1,038)
Unrealised FX losses/(gains) 1,267 153 394 459 873 (306)
Provisions and other payables 17,448 14,907 - - 17,448 14,907
Undeducted equity raising costs 730 1,094 - - 730 1,094
Undeducted capital expenditure 1,455 1,917 - - 1,455 1,917
Fair value derivatives - - 1,206 373 (1,206) (373)
Accrued revenue - - 872 1,172 (872) (1,172)
Inventories 120 103 5,765 4,657 (5,645) (4,554)
Other items 1,447 1,147 1,854 102 (407) 1,045
Tax value of loss carry-forwards recognised 224 506 - - 224 506
Tax assets / liabilities 25,769 22,523 14,309 10,809 11,460 11,714
Set off of tax (12,613) (9,128) (12,613) (9,128) - -
Net tax assets / liabilities 13,156 13,395 1,696 1,681 11,460 11,714
Unrecognised deferred tax assets
Deferred tax assets have not been recognised in respect of the following items:
Consolidated
4,767 4,023
Tax losses
Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable prot will be
available against which the Group can utilise the benets.
20. PROPERTY, PLANT AND EQUIPMENT
Consolidated
Freehold land and buildings:
At cost 119,199 82,737
Accumulated depreciation (14,371) (11,385)
104,828 71,352
Plant and equipment:
At cost 445,949 362,006
142,364 116,313
Leasehold improvements:
At cost 76,622 70,791
42,209 41,879
Leased plant and equipment:
At capitalised cost 16,140 16,380
9,320 10,142
Capital works in progress: 25,883 25,445
324,604 265,131
Reconciliations
Reconciliations of the carrying amounts for each class of property, plant and equipment are set out below:
Consolidated
Freehold land and buildings:
Carrying amount at the beginning of the year 71,352 44,696
Additions 11,098 13,099
Additions through entities acquired 6,673 24,233
Transfer from capital works in progress 18,824 -
Depreciation (2,062) (1,508)
Disposals - (8,014)
Effect of movement in foreign exchange (1,057) (1,154)
Carrying amount at end of year 104,828 71,352
Plant and equipment:
Additions 48,886 29,837
Transfers from capital works in progress 1,742 3,204
Transfer from leased plant and equipment (118) 1,080
Disposal (2,397) (5,739)
Effect of movement in foreign exchange (2,161) (3,566)
20. PROPERTY, PLANT AND EQUIPMENT continued
Reconciliations continued
Consolidated
Leasehold improvements:
Additions 4,874 2,812
Transfer from capital works in progress 1,730 -
Disposal (1,515) (991)
Effect of movement in foreign exchange (977) (2,867)
Leased plant and equipment:
Additions 92 -
Additions through entities acquired 95 5,381
Transfer to plant and equipment 118 (1,080)
Disposal (44) (48)
Effect of movement in foreign exchange (7) (89)
Product dispensers:
Carrying amount at the beginning of the year - 2,965
Additions - 527
Disposal - (2,433)
Depreciation - (1,059)
Carrying amount at end of year - -
Capital works in progress:
Additions 23,464 23,468
Transfers out of capital works in progress (22,296) (3,204)
Transfers to intangible assets (578) -
Effect of movement in foreign exchange (152) (33)
21. INTANGIBLE ASSETS
Consolidated
In thousands of AUD Goodwill
Purchased
trademarks and
brandnames
Software Total
Balance at 1 April 2011 497,936 3,650 1,904 503,490
Additions through business combinations 270,016 - 807 270,823
Additions 540 - 1,589 2,129
Transfers in from capital WIP - - 578 578
Disposal (4,573) - (6) (4,579)
Amortisation - - (1,347) (1,347)
Effect of movements in foreign exchange (3,385) 54 (86) (3,417)
Balance at 31 March 2012 760,534 3,704 3,439 767,677
Balance at 1 April 2010 387,219 3,687 2,186 393,092
Additions through business combinations 127,229 - - 127,229
Impairment (a) (7,857) - - (7,857)
Additions - - 900 900
Disposal (311) - (9) (320)
Amortisation - - (1,101) (1,101)
Effect of movements in foreign exchange (8,344) (37) (72) (8,453)
Balance at 31 March 2011 497,936 3,650 1,904 503,490
(a) The impairment loss recognised relates to the Reward Distribution reportable segment and has been included in administration and other expenses in the prot
and loss statement. During the year ended 31 March 2011 the Reward Distribution cash generating unit achieved earnings results well below managements
expectations. This caused management to reassess short term earnings forecasts used in estimating the recoverable amount of goodwill attaching to this cash
generating unit. Based on this assessment a goodwill impairment loss of $7,857,000 was recognised (refer note 8).
Impairment tests for cash generating units containing goodwill
The following cash generating units have signicant carrying amounts of goodwill:
Consolidated
ALS Minerals 332,475 129,764
ALS Environmental - Australia 50,929 43,426
ALS Environmental North America 98,404 75,709
ALS Environmental Europe 32,846 34,857
ALS Environmental Asia 9,057 7,849
ALS Coal 79,891 79,890
ALS Tribology 12,448 12,395
ALS Industrial 123,787 93,447
Campbell Chemicals 4,112 4,095
Reward Distribution 16,087 16,000
Other cash generating units 498 504
760,534 497,936
21. INTANGIBLE ASSETS continued
The recoverable amounts of goodwill in all cash-generating units exceed carrying amounts and are based on value in use calculations.
Those calculations use cash ow projections based on actual operating results, the budget for FY2013 and forecasts drawn from years two
and three of the Groups three-year forecast for FY2014 and FY2015. Cash ows for a further 17 year period are extrapolated using a real
growth rate of 3.0 per cent per annum. Directors believe this growth rate is a conservative estimate of the long-term average growth rates
achievable in the industries in which the Group participates. The following real pre-tax discount rates have been used in discounting the
projected cash ows.
Division Pre-tax (real) discount rate
2012 2011
ALS 11.5% 10.7%
Campbell Chemicals 10.4% 10.7%
Reward Distribution 9.2% 10.7%
Impairment tests for purchased trademarks and brandnames
The recoverable amounts of purchased trademarks and brandnames exceed their carrying amounts and are based on relief from royalty
methodology, representing value in use calculations. Relief from royalty cash ows are extrapolated for a 20 year period using a nil
growth rate. A pre-tax real discount rate of 10.35 per cent (2011: 10.7%) has been used in discounting the projected cash ows. No
amortisation is provided against the carrying amounts of purchased trademarks and brandnames on the basis that these assets are
considered to have indenite useful lives.
Software
Software assets are considered to have nite useful lives and are amortised in line with their assessed useful lives.
22. TRADE AND OTHER PAYABLES
Consolidated
Trade payables 35,465 30,133
Other payables and accrued expenses 87,728 65,588
123,193 95,721
23. INVESTMENT PROPERTY
Consolidated
Transfer from capital works in progress - -
Additions 89 147
Depreciation (149) (146)
Investment property comprises a commercial property leased to a third party. The current lease expires in September 2012 and the lessee
has exercised their option to renew the lease for a further ve years from that date. See note 27 for further information.
Fair value of the property is estimated to be $15,350,000 based on a capitalisation rate of 9.5%.
24. LOANS AND BORROWINGS
This note provides information about the contractual terms of the Groups interest-bearing loans and borrowings. For more information about
the Groups exposure to interest rate and foreign currency risk, see note 26.
Consolidated
Current Liabilities
Bank loans 1,755 40,731
Finance lease liabilities 2,299 2,051
4,054 42,782
Non-current liabilities
Bank loans 123,022 -
Long term notes 372,138 147,000
Finance lease liabilities 3,627 5,680
498,787 152,680
Bank loans
Bank loans are denominated in Australian dollars, Great British pounds and Swedish kronor. Current bank loans comprise the portion of
the Groups bank loans repayable within one year. Funding available to the Group from undrawn facilities at 31 March 2012 amounted to
$116,467,000 (2011: $202,821,000).
The weighted average interest rate (incorporating the effect of interest rate contracts) for all bank loans at balance date is 3.8% (2011: 2.1%).
The term loan facilities are committed facilities and are able to be drawn in the form of bank overdrafts, loans or bank guarantees.
The Company and six of its subsidiaries, namely Australian Laboratory Services Pty Ltd, ALS Canada Limited, ALS Group General Partnership, ALS
Technichem (Singapore) Pte Ltd, Stewart Inspection and Analysis Ltd, and CBL Campbell Brothers USA, Inc are parties to multi-currency term loan
facility agreements as borrowers with a number of banks.
Under the terms of the agreements, the Company and a number of its wholly-owned subsidiaries jointly and severally guarantee and indemnify
the banks in relation to each borrowers obligations.
Long term notes
The Companys controlled entity ALS Group General Partnership issued long term, xed rate notes to investors in the US Private Placement
market in December 2010 and again in July 2011. The notes are denominated in US dollars and Canadian dollars and mature as follows - 7 years
due December 2017: $28,991,000; 8 years due July 2019: $91,805,000; 10 years due December 2020: $116,050,000; and 11 years due July
2022: $135,292,000.
Interest is payable semi-annually to noteholders. The weighted average interest rate (incorporating the effect of interest rate contracts) for all
long term notes at balance date is 3.8% (2011: 2.3%).
Under the terms of the note agreements, the Company and a number of its wholly-owned subsidiaries jointly and severally guarantee and
indemnify the noteholders in relation to the issuers obligations.
Finance lease liabilities
Consolidated
Included as lease liabilities are the present values of future rentals for leased assets capitalised:
Current 2,299 2,051
Non-current 3,627 5,680
5,926 7,731
Lease commitments in respect of capitalised nance leases are payable:
Within one year 2,729 2,633
Later than one year but not later than ve years 3,704 5,881
Later than ve years 480 784
6,913 9,298
Future nance charges (987) (1,567)
Total lease liability 5,926 7,731
The Group leases plant and equipment under nance leases expiring over terms of up to seven years. At the end of the lease terms the Group
generally has the option to purchase the equipment at a percentage of market value - a price deemed to be a bargain purchase option. Lease
liabilities are secured by the leased assets as in the event of default the assets revert to the lessor.
25. CAPITAL AND RESERVES
Reconciliation of movement in capital
Consolidated
Issued and paid up share capital
67,503,411 ordinary shares fully paid (2011: 67,503,411) 610,382 610,382
Movements in ordinary share capital
Balance at beginning of year 610,382 456,734
Share issues:
Nil shares (2011: 1,052,032) under Dividend Reinvestment Plan (1) - 32,600
Nil shares (2011: 3,491,408) pursuant to Ammtec takeover offer (2) - 121,048
Balance at end of year 610,382 610,382
(1) Issued pursuant to the Companys Dividend Reinvestment Plan in the previous nancial year. The Company suspended the Plan following payment of the 2011
interim dividend.
(2) Issued pursuant to the Companys takeover offer for Ammtec Ltd in the previous nancial year.
Effective 1 July 1998, the Company Law Review Act abolished the concept of par value shares and the concept of authorised capital.
Accordingly, the Company does not have authorised capital or par value in respect of its issued shares.
Terms and Conditions
Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at
shareholders meetings. In the event of winding up of the Company, ordinary shareholders rank after creditors and are entitled to the net
proceeds of liquidation.
Employee Share Plan
The Group has an Employee Share Plan (the Share Plan) which is closed to new participants. The last share loan offer under the Share
Plan was made mid-2006. Any participation in a Company-sponsored employee incentive scheme is now via the Companys LTI plan refer
note 37.
Under the Share Plan, eligible employees of the Company or of its subsidiaries were able to acquire ordinary fully paid shares in the
Company. An external third party is trustee of the Share Plan.
Participation in the Share Plan by employees was at the discretion of the Board of Directors. The Board sets the conditions under
which employees can participate having regard to length of service and salary range. The Board administers the Share Plan as a non-
discriminatory plan within the meaning of Australian taxation legislation. The price of shares issued under the Share Plan was determined
at the discretion of directors and may be less than the prevailing market price. Employees were offered loans from a subsidiary to nance
their purchase of shares under the plan. Plan loans are interest free and repayable over 25 years.
Shares acquired by an employee under the Share Plan are held by a trustee for at least three years and until the whole of any related loan
has been paid in full by the employee. Once the loan has been repaid and a period of three years has expired, the trustee transfers the
shares to the employee. Dividends are applied by the trustee in reducing the employees plan loan. During the period while shares are
held by the trustee, the employee does not have voting rights in respect of those shares. On termination of employment, an employee has
thirty days in which to decide whether to either repay the loan and receive their shares by way of transfer from the trustee or request that
the shares be sold by the trustee after which any proceeds in excess of the outstanding loan amount are paid to the employee.
The aggregate number of shares held by the trustee under the Share Plan at any time must not exceed 5% of the total issued capital of the
Company. No shares were issued under the Share Plan during the nancial year (2011: Nil). The market price of shares issued under the
Share Plan as at 31 March 2012 was $67.23 (2011: $46.35).
Details of the movement in employee shares under the Share Plan are as follows:
2012
No.
2011
No.
Number of shares at beginning of year 50,000 201,800
Number of share issued to employees - -
Number of shares distributed to employees - (151,800)
Number of shares at end of year 50,000 50,000
The amounts recognised as receivable in the nancial statements of the Group in relation to employee shares at the end of the year are:
Consolidated
2012
$
2011
$
Current receivables Other debtors 106,250 191,250
25. CAPITAL AND RESERVES continued
Reserves
The foreign currency translation reserve comprises all foreign exchange differences arising from the translation of the nancial statements
of foreign operations where their functional currency is different to the presentation currency of the reporting entity, as well as from the
translation of liabilities or changes in fair value of derivatives that hedge the Companys net investment in a foreign subsidiary.
The hedging reserve comprises the effective portion of the cumulative net change in the fair value of cash ow hedging instruments
related to hedged transactions that have not yet occurred.
The employee share-based awards reserve comprises the cumulative amount, recognised as an employee expense to date, of the fair
value at grant date of share-based, share-settled awards granted to employees. Refer to notes 3(m) and 37.
Dividends
Dividends recognised in the current year by the Company are:

In thousands of AUD
Cents per share
Franked amount
(cents)
Total
amount
Date of
Payment
2012
Interim 2012 ordinary 95.0 47.5 64,128 19 December 2011
Final 2011 ordinary 75.0 37.5 50,628 1 July 2011
114,756
2011
Interim 2011 ordinary 65.0 32.5 43,524 21 December 2010
Total amount 78,152
Dividend declared after the end of the nancial year:
The nancial effect of this dividend has not been brought to account in the nancial statements for the year ended 31 March 2012 and will
be recognised in subsequent nancial reports.
The franked components of all dividends paid or declared since the end of the previous nancial year were franked based on a tax rate of 30%.
Dividend franking account
Consolidated
30% franking credits available to shareholders of Campbell Brothers Limited for subsequent
nancial years
25,953 18,427
The above available amounts are based on the balance of 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 by the tax consolidated group at the year-end; and
(d) franking credits that the entity may be prevented from distributing in subsequent years.
The ability to utilise the franking credits is dependent upon there being sufcient available prots to declare dividends.
The impact on the dividend franking account of dividends proposed after the balance sheet date but not recognised as a liability is to reduce it
by $18,805,000 (2011: $10,849,000).
26. FINANCIAL INSTRUMENTS
Liquidity risk
Contractual maturities for nancial liabilities on a gross cash ow basis are analysed below:
CONSOLIDATED
As at 31 March 2012
In thousands of AUD 6 months or less 6 to 12 months 1 to 2 years 2 to 5 years Over 5 years Total
Non-derivative nancial liabilities
Bank overdraft 1,161 - - - - 1,161
Trade and other payables 123,193 - - - - 123,193
Finance lease liabilities 1,413 1,316 1,852 1,852 480 6,913
Long term notes 8,379 8,333 16,712 29,562 433,630 496,616
Bank loans 3,268 3,250 6,518 126,834 - 139,870
Derivative nancial instruments (1,465) (1,406) (2,611) (4,518) (488) (10,488)
Total 135,949 11,493 22,471 153,730 433,622 757,265
CONSOLIDATED
As at 31 March 2011
In thousands of AUD 6 months or less 6 to 12 months 1 to 2 years 2 to 5 years Over 5 years Total
Non-derivative nancial liabilities
Bank overdraft 3,135 - - - - 3,135
Trade and other payables 95,721 - - - - 95,721
Finance lease liabilities 1,217 1,416 2,567 3,314 784 9,298
Long term notes 3,265 3,265 6,513 19,556 174,445 207,044
Bank loans 1,454 39,759 100 - - 41,313
Derivative nancial instruments (1,248) (1,388) (1,589) 2,452 9,387 7,614
Total 103,544 43,052 7,591 25,322 184,616 364,125
The gross outows/(inows) disclosed in the tables above for derivative nancial liabilities represent the contractual undiscounted cash
ows of derivative nancial instruments held for risk management purposes and which are usually not closed out prior to contractual
maturity. The disclosure shows net cash ow amounts for derivatives that are net cash settled.
Currency Risk
The Groups exposure to foreign currency risk at balance date was as follows, based on notional amounts:
CONSOLIDATED 2012
In thousands of AUD USD CAD SEK CZK EUR PLN GBP
Trade and other receivables 12,228 - - - 1,611 153 -
Cash at bank 28,282 36 - - 3,370 70 -
Bank loan - - (14,611) - - - (34,045)
Long term notes - (62,899) - - - - -
Trade and other payables (2,116) (14) - - (182) - -
Gross balance sheet exposure 38,394 (62,877) (14,611) - 4,799 223 (34,045)
Derivative nancial instruments* - (77,414) - (18,982) (10,037) - -
Net exposure 38,394 (140,291) (14,611) (18,982) (5,238) 223 (34,045)
* Amounts represent the notional amounts of cross currency interest rate swaps used for hedging of net investments in foreign operations.
26. FINANCIAL INSTRUMENTS continued
Currency Risk continued
CONSOLIDATED 2011
In thousands of AUD USD CAD SEK CZK EUR PLN
Trade and other receivables 7,460 - - - 811 12
Cash at bank 22,532 - - - 2,543 67
Bank loan - - (15,336) - - -
Long term notes - (64,780) - - - -
Trade and other payables (1,590) - - - (7) -
Gross balance sheet exposure 28,402 (64,780) (15,336) - 3,347 79
Derivative nancial instruments* - - - (20,385) - -
Net exposure 28,402 (64,780) (15,336) (20,385) 3,347 79
* Amounts represent the notional amounts of cross currency interest rate swaps used for hedging of net investments in foreign operations.
The following exchange rates against the Australian dollar applied at 31 March:
31 March spot rate
2012 2011
USD 1.034 1.034
CAD 1.033 1.003
SEK 6.844 6.521
CZK 19.229 17.906
EUR 0.7756 0.7295
PLN 3.2184 2.9321
GBP 0.646 N/A
Sensitivity analysis
A 10 percent strengthening of the Australian dollar against the above balances at 31 March would have increased (decreased) prot before
income tax and equity by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain
constant. The analysis is performed on the same basis for 2011.
Consolidated
In thousands of AUD Prot Equity
As at 31 March 2012
USD (3,490) -
CAD (2) 12,756
SEK - 1,328
CZK - 1,726
EUR (436) 912
PLN (20) -
GBP - 3,095
(3,948) 19,817
As at 31 March 2011
USD (2,582) -
CAD - 5,889
SEK - -
CZK - 1,853
EUR (304) -
PLN (7) 1,394
(2,893) 9,136
Sensitivity analysis continued
A 10 percent weakening of the Australian dollar against the above balances at 31 March would have increased (decreased) prot before
income tax and equity by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain
constant. The analysis is performed on the same basis for 2011.
Consolidated
In thousands of AUD Prot Equity
As at 31 March 2012
USD 4,266 -
CAD 2 (15,590)
SEK - (1,623)
CZK - (2,109)
EUR 533 (1,115)
PLN 25 -
GBP - (3,783)
4,826 (24,220)
As at 31 March 2011
USD 3,156 -
CAD - (7,198)
SEK - (1,704)
CZK - (2,265)
EUR 372 -
PLN 9 -
3,537 (11,167)
Interest rate risk
At the reporting date the interest rate prole of the Groups interest-bearing nancial instruments was:
Consolidated
Fixed rate instruments
Financial liabilities (378,064) (7,731)
Effect of interest rate contracts* 126,059 -
(252,005) (7,731)
Variable rate instruments
Financial assets 133,354 87,123
Financial liabilities (125,938) (190,866)
Effect of interest rate contracts* (126,059) -
(118,643) (103,743)
* Represents the net notional amount of interest rate swaps used for hedging.
Sensitivity analysis
Fair value sensitivity analysis for xed rate instruments
The Group has designated interest rate contracts as hedging instruments under a fair value hedge accounting model in relation to its xed
rate long term notes. The interest rate contracts swap the xed interest payable on a portion of the loan notes to variable interest rates for
the term of the debt. In accordance with the Groups accounting policy (refer note 3(d)) changes in fair value of the interest rate contracts
together with the change in fair value of the debt arising from changes in interest rates are recognised in the prot and loss (to the extent
the fair value hedge is effective). A change of 50 basis points in interest rates at the reporting date would not materially impact the
Groups prot and loss before income tax or equity (2011: Nil).
Sensitivity analysis continued
Cash ow sensitivity analysis for variable rate instruments
A change of 50 basis points in interest rates at the reporting date would have increased (decreased) prot before income tax and equity by
the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remain constant. The analysis
is performed on the same basis for 2011.
Consolidated
Prot Equity
In thousands of AUD 50 bp increase 50 bp decrease 50 bp increase 50 bp decrease
As at 31 March 2012
Variable rate instruments 37 (37) - -
Interest rate contracts - - - -
Cash ow sensitivity (net) 37 (37) - -
As at 31 March 2011
Variable rate instruments (519) 519 - -
Interest rate contracts - - - -
Cash ow sensitivity (net) (519) 519 - -
Fair values of nancial instruments
The Groups nancial assets and liabilities are included in the balance sheet at amounts that approximate fair values with the exception of
xed rate debt which has a fair value of $389,067,000. The basis for determining fair values is disclosed in note 5. The fair value at 31 March
2012 of derivative assets (2011: asset) held for risk management, which are the Groups only nancial instruments carried at fair value,
was a net gain of $2,777,000 (2011: gain of $1,244,000) measured using Level 2 valuation techniques as dened in the fair value hierarchy
shown in note 5. The Group does not have any nancial instruments that are categorised as Level 1 or Level 3 in the fair value hierarchy.
27. OPERATING LEASES
Leases as lessee
Non-cancellable operating lease rentals are payable as follows:
Consolidated
Less than one year 28,354 26,035
Between one and ve years 65,882 61,379
More than ve years 21,738 27,730
115,974 115,144
The Group leases property, plant and equipment under operating leases expiring over terms of up to six years. Leases generally provide the
Group with a right of renewal at which time all terms are renegotiated. Some leases provide for additional rent payments that are based
on a local price index. Lease commitments in respect of nance leases are disclosed in note 24.
During the year ended 31 March 2012 $36,873,000 was recognised as an expense in the prot and loss statement in respect of operating
leases (2011: $32,165,000).
Leases as lessor
The Group leases out its investment property held under operating lease (see note 23). The future minimum lease payments receivable
under non-cancellable leases are as follows:
Consolidated
Less than one year 1,518 1,154
Between one and ve years 6,545 1,188
8,063 2,342
During the year ended 31 March 2012 $1,435,000 was recognised as rental income in the prot and loss statement (2011: $1,142,000).
28. CAPITAL COMMITMENTS
Consolidated
Capital expenditure commitments
Plant and equipment contracted but not provided for and payable within one year 36,137 17,612
29. CONTINGENCIES
The directors are of the opinion that there are no material contingent liabilities at 31 March 2012.
30. DEED OF CROSS GUARANTEE
Pursuant to ASIC Class Order 98/1418 (as amended) dated 13 August 1998, the wholly-owned subsidiaries listed below are relieved
from the Corporations Act 2001 requirements for preparation, audit and lodgement of nancial reports, and directors reports.
It is a condition of the Class Order that the Company and each of the subsidiaries enter into a Deed of Cross Guarantee. The effect of the
Deed is that the Company guarantees to each creditor payment in full of any debt in the event of winding up of any of the subsidiaries
under certain provisions of the Corporations Act 2001. If a winding up occurs under other provisions of the Act, the Company will only
be liable in the event that after six months any creditor has not been paid in full. The subsidiaries have also given similar guarantees in
the event that the Company is wound up.
The subsidiaries subject to the Deed are:
ACIRL Proprietary Limited
ACIRL Quality Testing Services Pty Ltd
ALS Ammtec Holdings Pty Ltd (formerly Ammtec Ltd)
ALS Ammtec Pty Ltd (formerly Australian Metallurgical & Mineral Testing Consultants Pty Ltd)
ALS Ammtec Pty Ltd (formerly Australian Metallurgical & Mineral Testing Consultants Pty Ltd) atf Ammtec Unit Trust
ALS Industrial Australia Pty Ltd (formerly Pearl Street Metlabs Pty Ltd)
ALS Industrial Holdings Pty Ltd (formerly Pearl Street Limited)
ALS Industrial Pty Ltd (formerly Pearl Street ETRS Pty Ltd)
Australian Laboratory Services Pty Ltd
Ecowise Australia Pty Ltd
Ecowise Environmental Pty Ltd
Marc Technologies Pty Ltd
Marc Technologies Pty Ltd atf The Marc Unit Trust
Reward Supply Co. Pty Ltd
A consolidated prot and loss statement, consolidated statement of comprehensive income and consolidated balance sheet, comprising
the Company and subsidiaries which are a party to the Deed, after eliminating all transactions between parties to the Deed of Cross
Guarantee, at 31 March 2012 is set out below.
Summary prot and loss statement and retained prots
Consolidated
Prot before tax 190,464 115,005
Income tax expense (32,183) (20,496)
Prot after tax 158,281 94,509
Retained prots at beginning of year 35,947 19,590
Retained earnings adjustment* 5,571 -
Dividends recognised during the year (114,756) (78,152)
Retained prots at end of year 85,043 35,947
Statement of comprehensive income
Consolidated
Prot for the period 158,281 94,509
Net gain/(loss) on cash ow hedges taken to equity (871) 2,040
Total comprehensive income for the period 157,410 96,549
* Represents applicable amounts taken directly to retained earnings, together with adjustments for changes in the composition of the cross-guarantee group.
30. DEED OF CROSS GUARANTEE continued
Balance Sheet
Consolidated
Assets
Cash and cash equivalents 11,536 15,899
Trade and other receivables 124,062 101,554
Inventories 42,339 36,933
Other 7,118 4,177
Total current assets 185,055 158,563
Receivables 92,726 100,675
Investments accounted for using the equity method 10,881 17,134
Investment property 11,079 11,139
Deferred tax assets 10,824 10,452
Property, plant and equipment 162,309 144,016
Intangible assets 339,753 334,866
Other investments 194,921 86,328
Total non-current assets 822,493 704,610
Total assets 1,007,548 863,173
Liabilities
Trade and other payables 66,241 53,772
Income tax payable 17,170 6,144
Total current liabilities 114,823 126,738
Other 5,521 914
Total non-current liabilities 192,167 87,726
Net assets 700,558 648,709
Equity
Share capital 610,382 610,382
Reserves 5,133 2,380
Total equity 700,558 648,709
31. PARENT ENTITY DISCLOSURES
Result of parent entity
Other comprehensive income (871) 2,040
Total comprehensive income for the period 115,505 77,755
Financial position of parent entity at year end
Current assets 9,206 8,995
Total assets 844,435 764,814
Current liabilities 30,185 54,881
Net assets 625,557 621,645
Share capital 610,382 610,382
Reserves 5,133 2,380
Total equity 625,557 621,645
Parent entity capital commitments
Plant and equipment contracted but not provided for and payable within one year 259 560
259 560
Parent entity guarantees in respect of the debts of its subsidiaries
The Company is party to a number of nancing facilities and a Deed of Cross Guarantee under which it guarantees the debts of a number of its
subsidiaries. Refer to notes 24 and 30 for details.
32. CONSOLIDATED ENTITIES
The Groups major wholly owned operating entities are listed below:
Country of Incorporation
Parent entity
Campbell Brothers Limited Australia
Subsidiaries
Australian Laboratory Services Pty Ltd Australia
ACIRL Proprietary Ltd Australia
ACIRL Quality Testing Services Pty Ltd Australia
Ecowise Australia Pty Ltd Australia
ALS Industrial Australia Pty Ltd (formerly Pearl Street Metlabs Pty Ltd) Australia
ALS Industrial Pty Ltd (formerly Pearl Street ETRS Pty Ltd) Australia
ALS Ammtec Pty Ltd as trustee for Ammtec Unit Trust Australia
ALS Canada Ltd Canada
32. CONSOLIDATED ENTITIES continued
Country of Incorporation
CBL Campbell Brothers USA, Inc USA
ALS Group General Partnership USA
ALS Group USA, Corp USA
ALS USA, Inc USA
ALS Services USA, Corp USA
ALS Technichem (Singapore) Pte Ltd Singapore
ALS Chemex South Africa (Proprietary) Ltd South Africa
Abilab Burkina SARL Burkina Faso
Group de Laboratoire ALS MALI SARL Mali
ALS Scandinavia AB Sweden
Stewart Inspection and Analysis Limited United Kingdom
ALS Chemex de Mexico S.A. de C.V. Mexico
ALS Patagonia S.A. Chile
ALS Peru S.A. Peru
The above entities were wholly owned in the current and comparative periods, with the exception of Stewart Inspection and Analysis
Limited which was acquired during the year ended 31 March 2012.
33. RECONCILIATION OF CASH FLOWS FROM OPERATING ACTIVITIES
Consolidated
Adjustments for:
Amortisation and depreciation 46,199 42,171
Finance charges on capitalised leases 281 546
Finance income on capitalised leases - (172)
(Prot)/loss on sale of property plant and equipment (111) 389
Share-settled performance rights awarded during the year 1,241 975
Share of associates and joint venture net prot (1,384) (243)
Gain on sale of chemical and cleaning solutions business - (8,654)
Write-down to recoverable amount goodwill and inventories in Reward Distribution segment - 9,405
Net non-cash expenses 256 2,672
Operating cashow before changes in working capital and provisions 271,169 179,379
(Increase)/decrease in trade and other receivables (49,752) (24,803)
(Increase)/decrease in inventories (11,051) (11,381)
(Decrease)/increase in trade and other payables 4,152 8,730
(Decrease)/increase in taxation provisions 14,431 6,917
Net cash from operating activities 228,949 158,842
34. ACQUISITIONS OF SUBSIDIARIES AND NON-CONTROLLING INTERESTS
Business Combinations
In thousands of AUD Interest Acquired Date acquired Consideration
2012
Stewart Holdings Group Limited 100% July 2011 126,924
CAS Holdings, Inc. 100% October 2011 40,247
Austpower Engineering Pty Ltd 100% October 2011 35,204
Other acquisitions during the year 9,277
If the acquisitions had occurred on 1 April 2011, management estimates that Group revenue would have been $1,469,403,000 and net
prot would have been $233,283,000.
In thousands of AUD Interest Acquired Date acquired Consideration
2011
Ammtec Ltd 100% November 2010 161,044
Analytical Laboratory Services, Inc 100% December 2010 10,117
Analyticke Laboratore Plzen,a.s. 100% January 2011 890
Other acquisitions during the year 2,777
If the acquisitions had occurred on 1 April 2010, management estimates that Group revenue would have been $1,150,590,000 and net
prot would have been $138,918,000. Directly attributable transaction costs of $2,224,000 relating to prior year acquisitions were included
in administration and other expenses in the current years prot and loss statement.
Stewart Holdings Group Limited (consolidated group): net assets at acquisition dates
Recognised
values
In thousands of AUD 2012
Property, plant and equipment 13,979
Identiable intangible assets 11
Inventories 2,805
Trade and other receivables 19,030
Cash and cash equivalents 3,848
Interest-bearing loans and borrowings (89,707)
Trade and other payables (13,312)
Deferred tax liabilities (96)
Net identiable assets and liabilities (63,442)
Non-controlling interest at acquisition (2,239)
Goodwill on acquisition 192,605
Consideration paid, satised in cash 126,924
Cash (acquired) (3,848)
Net cash outow 123,076
Directly attributable transaction costs of $364,000 were included in administration and other expenses in the prot and loss statement. In
the period to 31 March 2012 Stewart Holdings Group Limited (Stewart Group) contributed a net prot of $10,579,000 to the consolidated
net prot for the year.
Stewart Group was acquired for the purpose of enhancing the global service reach of the Groups existing metallurgical and geochemical
mineral testing operations, as well as adding an inspection capability in servicing mining and mineral exploration companies. In
determining the fair value of the assets acquired in the business combination, Directors assessed that any identiable intangible assets
(such as customer relationships and brand names) were not material. The goodwill recognised on acquisition is attributable mainly to skills
and technical talent of Stewart Groups workforce and the synergies expected to be achieved from integrating the acquired operations into
the Groups existing business. The goodwill is not expected to be deductible for income tax purposes.
34. ACQUISITIONS OF SUBSIDIARIES AND NON-CONTROLLING INTERESTS continued
CAS Holdings, Inc. (consolidated group) net assets at acquisition dates
Recognised
values
Identiable intangible assets 23
Inventories 2,614
Cash and cash equivalents 404
Current tax asset 1,060
Deferred tax assets 243
Employee benets (1,332)
Trade and other payables (3,662)
Deferred tax liabilities (495)
Net identiable assets and liabilities 16,192
Consideration paid, satised in cash 40,247
Cash (acquired) (404)
Directly attributable transaction costs of $526,000 were included in administration and other expenses in the prot and loss statement. In the period
to 31 March 2012 CAS Holdings, Inc. (Columbia Analytical Group) contributed a net prot of $191,000 to the consolidated net prot for the year.
Columbia Analytical Group was acquired for the purpose of broadening the service reach of the Groups existing US environmental testing operations.
In determining the fair value of the assets acquired in the business combination, Directors assessed that any identiable intangible assets (such as
customer relationships and brand names) were not material. The goodwill recognised on acquisition is attributable mainly to skills and technical
talent of the acquired businesss workforce and the synergies expected to be achieved from integrating the company into the Groups existing
business. The goodwill is not expected to be deductible for income tax purposes.
Austpower Engineering Pty Ltd net assets at acquisition dates
Recognised
values
Deferred tax assets 11
Interest-bearing loans and borrowings (4,508)
Employee benets (679)
Trade and other payables (283)
Net identiable assets and liabilities 735
Total consideration payable in cash 35,204
Contingent consideration (9,250)
Cash (acquired) -
* Payable over the next two years dependent upon EBIT performance.
Directly attributable transaction costs of $210,000 were included in administration and other expenses in the prot and loss statement. In the period
to 31 March 2012 Austpower Engineering Pty Ltd contributed a net prot of $2,127,000 to the consolidated net prot for the year.
Austpower Engineering was acquired for the purpose of growing the Groups capacity to provide advanced technology and engineering services to
the power generation industry in Australia and will form part of the ALS Industrial division. In determining the fair value of the assets acquired in
the business combination, Directors assessed that any identiable intangible assets (such as customer relationships and brand names) were not
material. The goodwill recognised on acquisition is attributable mainly to skills and technical talent of the acquired businesss workforce and the
synergies expected to be achieved from integrating the company into the Groups existing business. The goodwill is not expected to be deductible
for income tax purposes.
34. ACQUISITIONS OF SUBSIDIARIES AND NON-CONTROLLING INTERESTS continued
Other acquirees net assets at acquisition dates
Recognised values
In thousands of AUD 2012 2011*
Property, plant and equipment 3,630 44,404
Identiable intangible assets 710 -
Inventories - 3,000
Trade and other receivables 2,916 24,752
Deferred tax assets 62 2,290
Cash and cash equivalents 621 1,642
Interest-bearing loans and borrowings (3,794) (9,085)
Employee benets (727) (2,964)
Trade and other payables (3,309) (15,425)
Deferred tax liabilities (183) (908)
Net identiable assets and liabilities (74) 47,706
Non-controlling interest at acquisition - (106)
Balance of investment in associate derecognised (7,127) -
Goodwill on acquisition 16,478 127,229
Shares issued (refer note 25) - (121,048)
Consideration paid, satised in cash (a) 9,277 53,781
Cash (acquired) (621) (1,642)
Net cash outow 8,656 52,139
* The comparatives disclose all 2011 acquisitions.
Directly attributable transaction costs of $63,000 (2011: $2,840,000) relating to these acquisitions were included in administration and
other expenses in the prot and loss statement.
During the period, the Group increased its previous 51% ownership in ALS Mineralogy Pty Ltd and its previous 50% ownership in Alex
Stewart Assayers (S) Pte Ltd by acquiring the remaining shareholdings. The existing equity accounted investments in ALS Mineralogy Pty
Ltd and Alex Stewart Assayers (S) Pte Ltd are deemed to have been disposed of upon acquisition (refer note 18).
In determining the fair value of the assets acquired in the business combination, Directors assessed that any identiable intangible assets
(such as customer relationships and brand names) were not material. The goodwill recognised on acquisition is attributable mainly to skills
and technical talent of the acquired businesss workforce and the synergies expected to be achieved from integrating the company into the
Groups existing business. The goodwill is not expected to be deductible for income tax purposes.
35. KEY MANAGEMENT PERSONNEL DISCLOSURES
The following were key management personnel of the Group at any time during the reporting period and unless otherwise indicated
were key management personnel for the entire period:
Non-executive directors Executives
G J McGrath (Chairman) B McDonald (Executive Vice President, ALS Minerals)
N Withnall (Deputy Chairman) R Naran (Executive Vice President, ALS Life Sciences (a) North America and Europe)
R G Hill B Williams (Group General Manger, ALS Life Sciences (a)
B R Brown Australia, Asia and ALS Industrial)
M J Bridges P McPhee (Group General Manager, ALS Energy (b))
G B Murdoch (appointed 1 September 2011) D Brown (Group General Manager, Chemical Division)
J F Mulcahy (appointed 1 February 2012) A Ross (Group General Manager, Reward Distribution)
Former Non-executive director Former Executive
M D Kriewaldt (retired 26 July 2011) P Jordan (former Group General Manager, ALS Tribology resigned November 2011)
Executive director (a) Formerly ALS Environmental
G F Kilmister (Managing Director and CEO) (b) Formerly ALS Coal

35. KEY MANAGEMENT PERSONNEL DISCLOSURES continued
The key management personnel compensation included in employee expenses are as follows:
Consolidated
In AUD 2012 2011
Short term employee benets 5,619,985 5,018,692
Post-employment benets 369,004 266,490
Value of share-based awards 929,978 947,458
Termination benets 18,102 82,738
Other long term benets 6,697 6,944
6,943,766 6,322,322
Loans to key management personnel and their related parties (consolidated)
Details regarding loans outstanding at the reporting date to key management personnel and their related parties, where the individuals
aggregate loan balance exceeded $100,000 at any time in the reporting period, are as follows:
Opening Balance $ Closing Balance $
Interest paid and payable
in the reporting period $
Highest balance
in the period $
2012
Director
G F Kilmister 191,250 106,250 - 191,250
2011
Director
G F Kilmister 261,146 191,250 - 261,146
Details regarding the aggregate of loans made, guaranteed or secured by any entity in the Group to key management personnel and their
related parties, and the number of individuals in each group, are as follows:
Opening Balance $ Closing Balance $
Interest paid and payable
in the reporting period $
Number in group
at 31 March
Total for key management personnel and
their related entities:
Director
2012 191,250 106,250 - 1
2011 261,146 191,250 - 1
Executives
2012 - - - -
2011 7,176 - - -
Loans made to the key management personnel are interest free (2011: 0%). These loans have been made to executives under the terms
of the Companys Employee Share Plan. Refer to note 25 for terms and conditions of loans under the Employee Share Plan. These loans are
on terms and conditions no more favourable than loans available to other employees under the Plan. No amounts have been written off, or
recorded as allowances, as the balances are considered fully collectible.
35. KEY MANAGEMENT PERSONNEL DISCLOSURES continued
Equity instruments
Movements in shares
The movement during the year in the number of ordinary shares in Campbell Brothers Limited held directly, indirectly or benecially by
each key management person, including their related parties:
2012 Opening Balance Purchases
Acquired due to vesting
of performance rights
Sales Other Closing Balance
Directors
G J McGrath 297,810 - - - - 297,810
N Withnall 2,559 - - - - 2,559
R G Hill 14,000 - - - - 14,000
B R Brown 50,000 - - (20,000) - 30,000
M J Bridges 2,370 1,050 - - - 3,420
G B Murdoch (a) - - - - 7,000 7,000
J F Mulcahy - - - - - -
M D Kriewaldt (b) 39,231 - - - (39,231) -
G F Kilmister 153,481 - 6,118 (15,000) - 144,599
Executives
B McDonald - - 2,900 (1,268) - 1,632
R Naran - - - - - -
B Williams 9,432 - 2,278 (650) - 11,060
P McPhee - - 2,363 - - 2,363
D Brown - - 2,257 - - 2,257
A Ross - - - - - -
P Jordan (c) 6,000 - 1,688 - (7,688) -
All purchases and sales complied with the Boards Securities Trading Policy which permits trading by directors and executives during certain
periods in the absence of knowledge of price-sensitive information.
(a) Mr Murdoch held shares in the Company before his appointment to the Board in September 2011.
(b) Mr Kriewaldt retired from the Board in July 2011.
(c) Mr Jordan ceased employment with the Group in November 2011.
Movements in performance rights over ordinary shares granted as compensation
The movement during the year in the number of performance rights over ordinary shares in Campbell Brothers Limited held directly,
indirectly or benecially by each key management person, including their related parties:
2012 Opening Balance Granted as compensation Vested and exercised Lapsed (a) Closing Balance
Director
G F Kilmister 47,767 13,595 6,118 1,270 53,974
Executives
B McDonald 16,463 3,097 2,900 602 16,058
R Naran (b) 6,019 2,505 1,749 363 6,412
B Williams 11,666 2,913 2,278 473 11,828
P McPhee 11,867 2,158 2,363 490 11,172
D Brown 2,726 917 2,257 469 917
A Ross - - - - -
P Jordan (a) 7,233 - 1,688 5,545 -
(a) The number of rights lapsed represents rights lapsed due to performance hurdles not being met and/or rights lapsed on cessation of employment. Performance
hurdle testing at 31 March 2011 of rights granted in August and September 2008 resulted in 83% of rights vesting and 17% of rights lapsing. Mr Jordan ceased
employment with the Group in November 2011.
(b) Performance rights granted to Mr Naran are cash-settled rights. Performance rights granted to all other executives above are equity-settled.
36. NON-KEY MANAGEMENT PERSONNEL RELATED PARTY DISCLOSURES
The Group has a related party relationship with its associates and joint ventures (see note 18) and with its key management personnel
(see note 35).
37. SHARE-BASED PAYMENTS
In 2008 the Group established a Long Term Incentive Plan (LTIP) designed as a retention and reward tool for high performing personnel.
Under the Plan key employees may be granted conditional performance rights to receive ordinary shares in the Company at no cost to
the employees (or in limited cases to receive cash-settled awards). All of the performance rights carry an exercise price of nil. The terms
and conditions of the performance rights granted to date are set out below together with details of rights vested, lapsed and forfeited:
Equity-settled performance rights
Granted year ended 31 March: 2012 2011 2010 2009
Date of grant 26-7-11 27-7-10 24-11-09 1-10-09 30-6-09 3-9-08 5-8-08
Testing date for performance hurdles 31-3-14 31-3-13 31-3-12 31-3-12 31-3-12 31-3-11 31-3-11
Vesting date 1-7-14 1-7-13 1-7-12 1-7-12 1-7-12 1-7-11 1-7-11
No. of rights granted 40,925 37,134 32,587 11,676 34,203 28,184 7,388
No. of rights lapsed during year
ended 31-3-11 (a)
- - - - - (1,711) -
No. of rights vested and exercised
during year ended 31-3-12 (a)
- - - - - (21,922) (6,118)
No. of rights lapsed during year
ended 31-3-12 (a)
- (1,865) - - (3,327) (4,551) (1,270)
No. of rights as at 31-3-12 40,925 35,269 32,587 11,676 30,876 - -
All equity-settled performance rights refer to rights over ordinary shares in the Company and entitle an executive to ordinary shares on
the vesting date, subject to the achievement of performance hurdles set out below. The rights expire on termination of an executives
employment prior to the vesting date or upon the failure of achievement of the performance hurdles.
(a) The number of rights lapsed represents rights lapsed due to performance hurdles not being met and/or rights lapsed on cessation of employment. Performance
hurdle testing at 31 March 2011 of rights granted in August and September 2008 resulted in 83% of rights vesting and 17% of rights lapsing.
Cash-settled performance rights
Granted year ended 31 March: 2012 2011 2010 2009
Date of grant 26-7-11 27-7-10 1-10-09 3-9-08
Testing date for performance hurdles 31-3-14 31-3-13 31-3-12 31-3-11
Vesting date 1-7-14 1-7-13 1-7-12 1-7-11
No. of rights granted 10,968 10,076 15,684 8,966
No. of rights vested during year ended 31/3/12 (a) - - - (7,425)
No. of rights lapsed during year ended 31/3/12 (a) - - - (1,541)
No. of rights as at 31/3/12 10,968 10,076 15,684 -
All cash-settled performance rights expire on termination of an executives employment prior to the vesting date or upon the failure of
achievement of the performance hurdles. The amount of cash payment is determined based on the volume weighted average price of
the Companys shares over the 20 trading days following the release of the Groups full year results for the nal year of each performance
period.
(a) The number of rights lapsed represents rights lapsed due to performance hurdles not being met. Performance hurdle testing at 31 March 2011 of rights granted in
September 2008 resulted in 83% of rights vesting and 17% of rights lapsing.
37. SHARE-BASED PAYMENTS continued
Vesting conditions in relation to the rights issued during the current year
Employees must be employed by the Group on the vesting date. The rights vest only if Earnings Per Share (EPS) or relative Total
Shareholder Return (TSR) hurdles are achieved by the Company over the specied performance period. 50 percent of each employees
rights are subject to EPS measurement and 50 percent are subject to the TSR measurement. The performance hurdles and vesting
proportions for each measure are as follows:
Compound annual diluted EPS growth from 1 April 2011 to 31 March 2014 Proportion of performance rights that may be exercised if EPS growth hurdle is met
Less than 10% per annum 0%
10% per annum 25%
Between 10% and 14% per annum Straight line vesting between 25% and 50%
14% or higher per annum 50% (i.e. 50% of total grant)
TSR of the Group relative to TSRs of comparator companies over the period 1
April 2011 to 31 March 2014
Proportion of performance rights that may be exercised if TSR hurdle is met
Less than the 50th percentile 0%
50th percentile 25%
Between 50th and 75th percentile Straight line vesting between 25% and 50%
75th percentile or higher 50% (i.e. 50% of total grant)
Comparator companies International companies: Bureau Veritas (France), Core Laboratories
(USA), Eurons (France & Germany), Intertek (UK), SGS (Switzerland).
Australian companies: Ausenco, Boart Longyear, Cardno, Clough, Coffey
International, Industrea, MacMahon Holdings, Monadelphous, Orica,
Sedgman, Servcorp, Transeld Services, WorleyParsons.
The cumulative performance hurdles are assessed at the testing date and the at risk LTI component becomes exercisable or is forfeited
by the executive at this time. New offers of participation are ratied by the Remuneration Committee.
Expenses recognised as employee costs in relation to share-based payments
The fair value of services received in return for performance rights granted during the year ended 31 March 2012 is based on the
fair value of the rights granted measured using Binomial Tree (EPS hurdle) and Monte-Carlo Simulation (TSR hurdle) valuation
methodologies with the following inputs:
Granted 2012 Granted 2011
Equity-settled rights
Date of grant 26 July 2011 27 July 2010
Weighted average fair value at date of grant $36.02 $25.06
Share price at date of grant $47.15 $31.31
Expected volatility 30% 45%
Expected life 2.9 years 2.9 years
Risk-free interest rate 4.32% 4.71%
Dividend yield 3.70% 3.50%
Cash-settled rights
Date of grant 26 July 2011 27 July 2010
Weighted average fair value at date of grant $36.02 $25.06
Share price at date of grant $47.15 $31.31
Expected volatility 30% 45%
Expected life 2.9 years 2.9 years
Risk-free interest rate 4.32% 4.71%
Dividend yield 3.70% 3.50%
37. SHARE-BASED PAYMENTS continued
Expenses recognised as employee costs in relation to share-based payments continued
The fair value of the liability for cash-settled rights, for which performance hurdle testing dates remain in the future, is remeasured
at each reporting date and at settlement date using Binomial Tree (EPS hurdle) and Monte-Carlo Simulation (TSR hurdle) valuation
methodologies. The model inputs and resulting valuations at 31 March were:
Cash-settled rights 2012 2011
Inputs: *
Date of grant 26 July 2011 27 July 2010 27 July 2010 1 Oct 2009
Share price at 31 March $67.23 $67.23 $46.35 $46.35
Expected volatility 25% 25% 30% 30%
Expected life 2.3 years 1.3 years 2.3 years 1.3 years
Risk-free interest rate 3.44% 3.55% 4.92% 4.80%
Dividend yield 3.90% 3.90% 3.50% 3.50%
Weighted average fair value at grant date $36.02 $25.06 $25.06 $26.91
Weighted average fair value at 31 March $58.00 $63.71 $40.01 $44.35
* Cash-settled rights granted 1 October 2009
The performance hurdle testing date for cash-settled rights granted on 1 October 2009 was 31 March 2012 (vesting date: 1 July 2012). The
fair value of the liability at 31 March 2012 for these cash-settled rights was determined by reference to the Groups performance against
prescribed hurdles over the three year period to the testing date and the Companys closing share price as at that date:
2012
Proportion of performance rights granted October 2009 that will vest 1 July 2012 pursuant to:
EPS growth hurdle 50%
TSR hurdle 50%
Total 100%
Share price at end of year $67.23
Weighted average fair value at grant date $26.91
Weighted average fair value at end of year $67.23
The amount ultimately payable on vesting date will be based on the volume weighted average price of the Companys shares over the 20
trading days following the release of the Groups full year results.
Expenses recognised in relation to share-based payments during the year were:
Consolidated
Equity-settled rights 8 1,240 975
Cash-settled rights 8 1,035 590
Total expenses recognised as employee costs 2,275 1,565
Total carrying amount of liabilities for cash-settled rights 1,473 810
38. EVENTS SUBSEQUENT TO BALANCE DATE
On 4 April 2012, the Group acquired Eclipse Scientic Group (Eclipse) and Advanced Micro Services (AMS) for a combined enterprise value of
approximately $40 million. UK-based Eclipse is a provider of food, dairy, water and pharmaceutical testing services to a blue chip customer
base comprising manufacturers, food processors and retailers. AMS provides similar services to the Irish market. The companies will be
integrated into the Groups newly formed ALS Life Sciences Division and are an important part of the Groups strategy to build a global
food/pharmaceutical laboratory services business.
Given the timing of the above acquisition, the Group is in the process of determining the accounting treatment required and will include
detailed disclosures in its 30 September 2012 interim nancial statements.
Other than the matter discussed above, there has not arisen in the interval between the end of the nancial year and the date of this
report any item, transaction or event of a material and unusual nature likely, in the opinion of the directors of the company, to affect
signicantly the operations of the Group, the results of those operations, or the state of affairs of the Group, in future nancial years.
Directors declaration
1. In the opinion of the directors of Campbell Brothers Limited (the Company):
a. the consolidated nancial statements and notes, numbered 1 to 38, and the remuneration report contained in section 7 of the
Directors report, are in accordance with the Corporations Act 2001, including:
i. giving a true and fair view of the Groups nancial position as at 31 March 2012 and of its performance for the year ended on
that date; and
ii. complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations
Regulations 2001;
b. the nancial report also complies with International Financial Reporting Standards as disclosed in note 2(a);
c. there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.
2. There are reasonable grounds to believe that the Company and the subsidiaries identied in note 30 will be able to meet any obliga-
tions or liabilities to which they are or may become subject, by virtue of the Deed of Cross Guarantee between the Company and those
entities, pursuant to ASIC Class Order 98/1418.
3. The directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the Chief Executive Ofcer
and Chief Financial Ofcer for the nancial year ended 31 March 2012.
Signed in accordance with a resolution of the directors:
G J McGrath G F Kilmister
Chairman Managing Director
Brisbane Brisbane
21 May 2012 21 May 2012
Independent auditors report
TO THE MEMBERS OF CAMPBELL BROTHERS LIMITED
Report on the nancial report
We have audited the accompanying nancial report of Campbell Brothers Limited (the Company), which comprises the consolidated
balance sheet as at 31 March 2012, and consolidated prot and loss statement, consolidated statement of comprehensive income,
consolidated statement of changes in equity and consolidated statement of cash ows for the year ended on that date, notes 1 to 38
comprising a summary of signicant accounting policies and other explanatory information and the directors declaration of the Group
comprising the Company and the entities it controlled at the years end or from time to time during the nancial year.
Directors responsibility for the nancial report
The directors of the Company are responsible for the preparation of the nancial report that gives a true and fair view in accordance with
Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to
enable the preparation of the nancial report that is free from material misstatement whether due to fraud or error. In note 2(a), the
directors also state, in accordance with Australian Accounting Standard AASB 101 Presentation of Financial Statements, that the nancial
statements of the Group comply with International Financial Reporting Standards.
Auditors responsibility
Our responsibility is to express an opinion on the nancial report based on our audit. We conducted our audit in accordance with Australian
Auditing Standards. These Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements
and plan and perform the audit to obtain reasonable assurance whether the nancial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the nancial report. The procedures
selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the nancial report,
whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entitys preparation
of the nancial report that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but
not for the purpose of expressing an opinion on the effectiveness of the entitys internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating
the overall presentation of the nancial report.
We performed the procedures to assess whether in all material respects the nancial report presents fairly, in accordance with the
Corporations Act 2001 and Australian Accounting Standards, a true and fair view which is consistent with our understanding of the Groups
nancial position and of its performance.
We believe that the audit evidence we have obtained is sufcient and appropriate to provide a basis for our audit opinion.
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001.
Auditors opinion
In our opinion:
(a) the nancial report of the Group is in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Groups nancial position as at 31 March 2012 and of its performance for the year ended on that
date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
(b) the nancial report also complies with International Financial Reporting Standards as disclosed in note 2(a).
Report on the remuneration report
We have audited the remuneration report included in section 7 of the directors report for the year ended 31 March 2012. The directors
of the Company are responsible for the preparation and presentation of the remuneration report in accordance with Section 300A of the
Corporations Act 2001. Our responsibility is to express an opinion on the remuneration report, based on our audit conducted in accordance
with auditing standards.
Auditors opinion
In our opinion, the remuneration report of Campbell Brothers Limited for the year ended 31 March 2012, complies with Section 300A of the
Corporations Act 2001.
KPMG Mitchell C Petrie
Partner
Brisbane
21 May 2012
KPMG, an Australian partnership and member rm of the KPMG network of independent member
rms afliated with KPMG International Cooperative (KPMG International), a Swiss entity.
Liability limited by a scheme approved under Professional Standards Legislation.
Lead auditors independence declaration
UNDER SECTION 307C OF THE CORPORATIONS ACT 2001
To: the directors of Campbell Brothers Limited
I declare that, to the best of my knowledge and belief, in relation to the audit for the nancial year ended 31 March 2012 there have been:
no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the audit.
KPMG
Mitchell C Petrie
Partner
Brisbane
21 May 2012
KPMG, an Australian partnership and member rm of the KPMG network of independent member
rms afliated with KPMG International Cooperative (KPMG International), a Swiss entity.
Liability limited by a scheme approved under Professional Standards Legislation.
Shareholder Information
Twenty Largest Shareholders
Registered Holder Address
No. of Ordinary
Shares Held
% of Issued
Capital
1 HSBC Custody Nominees (Australia) Limited NSW 9,941,588 14.73
2 J P Morgan Nominees Australia Limited NSW 5,944,008 8.81
3 National Nominees Limited VIC 5,176,939 7.67
4 Milton Corporation Limited NSW 2,168,165 3.21
5 Cogent Nominees Pty Limited NSW 2,038,643 3.02
6 J P Morgan Nominees Australia Limited <Cash Income A/C> VIC 1,993,650 2.95
7 Citicorp Nominees Pty Limited VIC 1,547,222 2.29
8 Faircase Pty Ltd QLD 1,291,741 1.91
9 Australian Foundation Investment Company Limited VIC 844,024 1.25
10 Argo Investments Limited SA 716,395 1.06
11 Gardenglen Pty Ltd QLD 401,535 0.59
12 BKI Investment Company Limited NSW 389,734 0.58
13 Mrs Dorothy Anne Stewart QLD 337,250 0.50
14 AMP Life Limited NSW 336,814 0.50
15 ANZ Trustees Limited <Queensland Common Fund A/C> VIC 314,301 0.47
16 Troxeld Pty Ltd <Mcgrath Family Account> QLD 297,810 0.44
17 Mirrabooka Investments Limited VIC 272,531 0.40
18 Washington H Soul Pattinson And Company Limited NSW 261,757 0.39
19 Cogent Nominees Pty Limited <Smp Accounts> NSW 247,110 0.37
20 Miss Margaret Helen Mittelheuser QLD 231,000 0.34
TOTAL 34,752,217 51.48
AS AT 18 MAY 2012
Shareholder Information
Other ASX Requirements Other Shareholder Information
SUBSTANTIAL SHAREHOLDERS
There were no substantial shareholders
as disclosed in substantial shareholding
notices given to the Company as at
18 May 2012.
STATEMENT OF QUOTED SECURITIES
The Companys total number of shares
on issue is 67,503,411 ordinary fully paid
shares. At 18 May 2012 the total number
of shareholders owning these shares
was 9,565 on the register of members
maintained by Computershare Investor
Services Pty Ltd.
51.48% of total issued capital is held
by or on behalf of the twenty largest
shareholders.
VOTING RIGHTS
Under the Companys Constitution, every
member entitled to vote who is present
at a general meeting of the Company in
person or by proxy or by attorney or in the
case of a corporation, by representative,
shall, upon a show of hands, have one
vote only.
Proxies - Where a member appoints 2
proxies, neither proxy is entitled to a vote
on a show of hands.
Poll - On a poll, every member entitled
to vote shall, whether present in person
or by proxy or attorney or, in the case of a
corporation, by representative, have one
vote for every share held by the member.
PERFORMANCE RIGHTS
At 18 May 2012, there were 151,333
Performance Rights granted over unissued
ordinary shares in the Company, granted to
23 group executives.
DISTRIBUTION SCHEDULE OF SHAREHOLDERS
No. of Shares Held No. of Shareholders
1 - 1,000 4,995
1,001 - 5,000 3,239
5,001 - 10,000 694
10,001 -100,000 589
100,001 and over 48
9,565
The number of shareholders each holding
less than a marketable parcel of the
Companys ordinary shares ($500 in value)
at 18 May 2012 was 251.
UNCERTIFICATED SHARE REGISTER
The Companys share register is totally
uncerticated. Two forms of uncerticated
holdings are available to shareholders:
Issuer Sponsored holdings
(starts with an I): sponsored by the
Company. Has the advantage of being
uncerticated without the need to be
sponsored by a stockbroker.
Broker Sponsored holdings
(starts with an X): sponsored by a
stockbroker. This type is attractive to
regular stockmarket traders or those
shareholders who have their share
portfolio managed by a stockbroker.
Holding statements are usually issued
to shareholders within 5 business days
after the end of any month in which
transactions occur that alter the balance of
your shareholding.
SECURITIES EXCHANGE LISTING
The shares of Campbell Brothers Limited
are listed on the Australian Securities
Exchange (ASX) under the trade symbol
CPB, with Sydney being the home
exchange (effective 26 March 2012).
Details of trading activity are published in
most daily newspapers, generally under
the abbreviation of Campbell Brothers.
ON-MARKET BUY-BACK
There is no current on-market buy-back of
the Companys Securities.
Visit the Companys website at www.
campbell.com.au for the latest information
on the Companys activities.
SHARE REGISTRY
To update and manage your shareholding
easily and quickly, go to www-au.comput-
ershare.com and login to Investor Centre to
make changes to your address or view bal-
ances. Any questions concerning your CBL
shareholding, share transfers or dividends,
please contact our Share registry, Comput-
ershare Investor Services Pty Ltd. They can
be contacted by phone on 1300 552 270
(within Australia), +61 7 3237 2100, by fax
on +61 7 3229 9860 or online at the above
web address.
ANNUAL REPORTS
The latest Annual Report can be accessed
from the Companys website at www.
campbell.com.au. If you are a shareholder
and wish to receive a hard copy of the
annual report, please contact our Share
registry, Computershare Investor Services
Pty Ltd, to request that the annual report
be sent to you in future.
CHANGING YOUR ADDRESS?
If you change your address, please prompt-
ly notify our Share registrar in writing. You
should quote your SRN (Shareholder Refer-
ence Number) or HIN (Holder Identication
Number) and also quote your old address
as an added security check.
DIRECT DEPOSIT INTO BANK ACCOUNTS
You can choose to have your CBL dividends
paid directly into a bank, building society
or credit union account in Australia on the
dividend payment date. Details will be
conrmed by an advice mailed to you on
that date. Application forms are available
from the Share registrar.
DIVIDEND REINVESTMENT PLAN (DRP)
The Company has re-introduced the DRP,
which was previously suspended follow-
ing the FY2011 interim dividend payment
in December 2010. A new DRP has been
established which will be in operation for
the FY2012 nal dividend.
Ten Year Summary
2003
$000
2004
$000
2005*
$000
2006
$000
2007
$000
2008
$000
2009*
$000
2010
$000
2011
$000
2012
$000
SALES REVENUE 359,278 390,269 435,562 522,654 662,654 772,286 920,351 825,533 1,108,329 1,405,609
FUNDS EMPLOYED
Share capital
Reserves
Retained earnings
Non-controlling interest
Non-current liabilities
Current liabilities
100,067
(2,506)
28,700
230
92,786
53,592
104,327
(7,344)
37,768
995
100,006
48,593
112,185
(421)
37,496
1,971
84,991
65,850
197,923
3,398
53,650
1,681
118,648
85,734
208,692
5,792
83,538
1,525
133,037
83,345
223,111
(6,012)
120,502
604
239,483
99,981
242,724
48
169,140
1,156
106,699
285,321
456,734
(18,199)
189,772
1,437
206,485
118,856
610,382
(30,315)
243,974
1,479
159,759
186,668
610,382
(36,931)
351,171
5,582
509,647
195,863
Total funds employed 272,869 284,345 302,072 461,034 515,929 677,669 805,088 955,085 1,171,947 1,635,714
REPRESENTED BY
Property, plant & equipment
Current assets
Non-current assets
Intangibles
86,572
106,594
13,173
66,530
85,947
111,784
13,284
73,330
89,313
137,529
8,063
67,167
125,361
188,863
10,831
135,979
134,566
215,660
29,170
136,533
152,074
259,075
36,327
230,193
210,344
286,503
40,151
268,090
216,846
294,489
50,658
393,092
265,131
356,587
46,739
503,490
324,604
506,098
37,335
767,677
Total assets 272,869 284,345 302,072 461,034 515,929 677,669 805,088 955,085 1,171,947 1,635,714
TRADING RESULTS
Financing costs (net)
Depreciation & amortisation
Prot before tax
Income tax expense
Prot after tax
(before gwill & unusual items)
Prot after tax
- attributable to members
Prot after tax, goodwill & unusual items
Dividend
5,125
15,459
17,238
5,703
14,558
14,919
11,896
11,723
5,752
15,768
21,509
6,903
17,904
17,939
14,641
13,183
5,477
13,999
45,143
10,381
24,966
25,005
34,344
17,297
5,555
16,512
52,075
17,182
34,227
34,177
34,843
23,560
6,849
24,310
86,537
27,519
51,600

51,648
59,066
36,072
9,775
28,172
109,006
31,804
71,655
71,270
76,819
49,456
14,415
37,139
150,708
44,517
106,191
106,209
106,209
52,806
11,121
39,944
105,862
30,971
74,891
75,301
75,301
62,780
10,244
42,172
185,125
52,835
132,144

132,208
132,354
94,152
15,623
46,199
311,958
87,271

224,687

222,413
222,413
151,882
OTHER STATISTICS (Ref) (a) (b) (c) (d) (e) (f) (g) (h) (i)
Net tangible asset backing per share $
1.53 1.56 2.04 2.37 3.16 2.07 2.73 3.76 4.77 2.41
Earnings per share
c 37.33 45.05 61.14 75.48 100.08 137.87 195.12 128.35 202.87 332.85
Earnings per share
c 38.25 45.14 61.24 75.37 100.17 137.13 195.16 129.06 202.97 329.48
Earnings per share
(after gwill & unusual items)
c 30.50 36.84 84.11 76.84 114.56 147.81 195.16 129.06 203.19 329.48
Dividends per share
c 30.0 33.0 42.0 50.0 70.0 95.0 100.0 100.0 140.0 225.0
Return on average equity
% 11.5 13.7 17.4 16.8 18.6 22.5 28.3 14.4 18.2 25.6
Return on average equity
% 9.4 11.2 23.9 17.1 21.2 24.1 28.3 14.4 18.2 25.3
Net debt (debt - cash)
$000 85,783 94,040 73,171 85,680 88,907 191,466 209,574 146,960 111,474 370,648
Gearing ratio
(net debt/(net debt + total equity))
% 40.4 40.9 32.6 25.0 22.9 36.1 33.7 18.9 11.9 28.5
Interest cover
times 3.8 4.1 5.6 7.2 8.5 8.3 8.4 7.7 13.9 15.4
Interest cover
times 4.4 4.7 9.2 10.4 13.6 12.2 11.5 10.5 19.1 21.0
No. of employees
2,306 2,400 3,090 4,268 4,863 6,854 5,717 7,570 8,936 12,101
(a) Following the issue of 404,680 shares
(b) Following the issue of 888,141 shares
(c) Following the issue of 1,214,541 shares

(d) Following the issue of 9,723,228 shares
(including 1:5 rights issue)
(e) Following the issue of 634,409 shares
* 2005 gures restated to AIFRS
(f) Following the issue of 514,100 shares
(g) Following the issue of 896,675 shares
* 2009 EPS gures restated for rights issue in Nov 09
(h) Following the issue of 9,926,686 shares
(including 1:6 rights issue in Nov 09)
(i) Following the issue of 4543,440 shares (including
3,491,408 shares for Amntec acquisition)
Principal Ofces
CAMPBELL BROTHERS LIMITED
Registered Head Ofce
Level 2, 299 Coronation Drive
Milton, Brisbane, Queensland 4064
Australia
Telephone: +61 7 3367 7900
Facsimile: +61 7 3367 8156
www.campbell.com.au
ALS GROUP
Global Corporate Head Ofce
Milton, Brisbane, Queensland 4064
Australia
Telephone: +61 7 3367 7900
Facsimile: +61 7 3367 8156
www.alsglobal.com
ALS REGIONAL OFFICES
AFRICA
Minerals
61 Brunton Circle,
Founders View South
Modderfontein, Johannesburg
Gauteng 1609
South Africa
Telephone: +27 11 608 0555
Facsimile: +27 11 608 3163
ASIA
Life Sciences
14 Little Road #07-01 & #08-01
Tropical Industrial Building
Singapore 536987
Telephone: +65 6283 9268
Facsimile: +65 6283 9689
AUSTRALIA
Minerals and Life Sciences
2632 Shand Street
Stafford, Queensland 4053
Telephone: +61 7 3243 7222
Facsimile: +61 7 3243 7218
Energy
478 Freeman Road
Richlands, Queensland 4077
Telephone: +61 7 3713 8400
Facsimile: +61 7 3717 0774
Industrial
109 Bannister Road
Canning Vale WA 6155
Telephone: +61 8 9232 0303
Facsimile: +61 8 9232 0399
Minerals
6 MacAdam Place
Balcatta WA 6021
Telephone: +61 8 9344 2416
Facsimile: +61 8 9345 4688
EUROPE
England
Minerals
STEWART GROUP
Caddick Road, Knowsley Business Park
Prescot, L34 9HP
Telephone: +44 (0) 151 548 7777
Facsimile: +44 (0) 151 548 0714
www.stewartgroupglobal.com
Life Sciences
ECLIPSE SCIENTIFIC GROUP
Sands Mill, Hudderseld Road
Mireld, West Yorkshire
WF14 9DQ
Telephone: +44 (0) 1924 499 776
Facsimile: +44 (0) 1924 499 731
www.eclipsescientic.co.uk
Ireland
Minerals
OMAC Minerals Lab
Athenry Road
Loughrea
Telephone: +353 (0) 91 841 741
Life Sciences
ADVANCED MICRO SERVICES
Unit 2, South Ring West Business Park,
Tramore Road, Cork
Telephone: +353 (0) 21 431 7982
Facsimile: +353 (0) 21 432 7290
www.amslabs.ie
Czech Republic
Life Sciences
Na Harfe 9/336
190 00 Prague 9
Telephone: +420 284 081 645
Facsimile: +420 284 081 635
NORTH AMERICA
Minerals
2103 Dollarton Highway
North Vancouver, BC, V7H 0A7
Canada
Telephone: +1 604 984 0221
Facsimile: +1 604 984 0218
Life Sciences
10450 Stancliff Road, Suite 210
Houston Texas 77099
United States
Telephone: +1 281 530 5656
Facsimile: +1 281 530 5887
SOUTH AMERICA
Minerals
Calle 1 Lt-1A Mz D,Esq. Con Calle A,
Urb. Industrial Bocanegra,
Callao 1, Lima, Peru
Telephone: +51 1 574 5700
Facsimile: +51 1 574 0721
CAMPBELL CHEMICALS
DELTREX CHEMICALS
7-11 Burr Court,
Laverton North, Melbourne,
Victoria 3026
Telephone: +61 3 9250 1000
Facsimile: +61 3 9250 1007
www.deltrex.com.au
PANAMEX PACIFIC
New Zealand
Head Ofce
Level 3, 52 Swanson Street
Auckland NZ
Telephone: +64 9 379 1440
Facsimile: +64 9 379 1449
www.panamex.co.nz
Papua New Guinea
PANAMEX PACIFIC (PNG)
Ibis Street, Lae,
Papua New Guinea
Telephone: +675 472 3566
Facsimile: +675 472 6604
United States of America
PANAMEX PACIFIC, INC
620 East Washington Street, Suite 118
Petaluma, California 94952
Telephone: +707 766 9604
Facsimile: +707 766 9581
REWARD DISTRIBUTION
Head Ofce
13 Business Street
Yatala, Queensland 4207
Telephone: +61 7 3441 5800
Facsimile: +61 7 3441 5803
www.rewarddistribution.com.au
REGISTERED OFFICE
Milton Qld 4064
Telephone: +61 7 3367 7900
Facsimile: +61 7 3367 8156
www.campbell.com.au
DIRECTORS
Geoff McGrath (Chairman)
Nerolie Withnall (Deputy Chairman)
Greg Kilmister (Managing Director)
Ray Hill
Bruce Brown
Mel Bridges
Grant Murdoch
John Mulcahy
COMPANY SECRETARY
Tim Mullen
AUDITORS
KPMG
SOLICITORS
Minter Ellison Lawyers
BANKERS
Australia and New Zealand
Banking Group Limited
Commonwealth Bank of Australia
Royal Bank of Canada
Westpac Banking Corporation
SHARE REGISTRY
Computershare Investor Services Pty Limited
117 Victoria Street
West End QLD 4101
Enquiries: 1300 552 270 (within Australia)
Telephone: +61 7 3237 2100
Facsimile: +61 7 3229 9860
www-au.computershare.com
ABN 92 009 657 489
General Information

2012 06 29 Annual Report To Shareholders PDF

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2012 06 29 Annual Report To Shareholders PDF

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