Annual Report for Personal Use Only
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Annual Report For the year ended 30 June 2020 Stealth Global Holdings Ltd | ACN 615 518 020 An Australian Multinational Distribution Group For personal use only About Stealth Global Holdings THE COMPANY An Australian multinational distribution group headquartered in Perth, Western Australia. The group operates a fully connected network in Australia, United Kingdom and Africa as its primary markets and other select international markets based on strategic activities. DISTRIBUTION BUSINESS MODEL Through an omnichannel approach, we are a one-stop-shop for essential everyday items and total supply chain activities, underpinned by sales specialists, physical store network, fulfillment services, distribution centres, eCommerce and strong marketing, content and advertising programs to business customers (B2B) and to retail consumers (B2C). OUR RANGE OF PRODUCT BRANDS As a supplier and distributor, we offer an assortment of essential everyday items in the categories of safety/PPE, industrial/MRO, workplace, print and promotional, retail, healthcare, cleaning and hygiene, hardware, building and construction and general merchandise. WE SERVE ALL TYPES OF CUSTOMERS AND INDUSTRIES (BUSINESS AND RETAIL) With more than 3,000 business customers, large to small size, we provide customers with purchasing options and fulfillment solutions that are necessary in their everyday requirements. The variety of industry sectors we cater for is vast, such as, Resources, Industrial, Infrastructure, Transportation, Engineering, Manufacturing, Building, Construction, Government, Contractors, Trade, General Industry and Retail customer markets. Customers place orders online, on mobile devices, through sales representatives, account managers, over the phone, by email, at local branches, affiliates trade stores and retail outlets. We plan to expand our products to retail customers via a combination of eCommerce, instore and onsite models. OUR SUPPLIERS We source from more than 1,500 suppliers across 19 countries, providing access to more than 300,000 product items. Approximately 40,000 are stocked in our distribution centres, branch network and at affiliates trade and retail stores. Stock availability with certainty of supply is essential to meet customer demand. Our Operating Brands For personal use only Table of Contents Corporate Directory 2 Chairman’s Statement 10 Company Overview and FY20 Achievements 13 Operating and Financial Review 24 Directors’ Report 32 Annual Financial Report 46 Consolidated Statement of Profit or Loss and Comprehensive Income 47 Consolidated Statement of Financial Position 48 Consolidated Statement of Changes in Equity 49 Consolidated Statement of Cash Flows 50 Notes to The Consolidated Financial Statements 51 Directors’ Declaration 90 Auditor’s Independence Declaration 91 Independent Auditor’s Report 92 ASX Additional Information - Shareholdings 96 For personal use only Stealth Global Holdings Annual Report 2020 1 Corporate Directory Directors ASX code Mr Christopher Wharton AM SGI Non-Executive Chairman Share Registry Mr Michael Arnold Computershare Investor Services Group Managing Director Level 11, 172 St Georges Terrace Mr Giovanni (John) Groppoli Perth WA 6000 Non-Executive Director Telephone: 1300 850 505 (within Australia) Mr Alan Cransberg Telephone: +61 3 9415 4000 (overseas) Non-Executive Director Company Auditor Company Secretary BDO Audit (WA) Pty Ltd Ms Karen Logan 38 Station Street Subiaco WA 6008 Key Management Personnel Mr Luke Cruskall Bankers Group Chief Operating Officer Australia and New Zealand Banking Group Limited Level 7, 77 St Georges Terrace Mr John Boland Perth WA 6000 Group Chief Financial Officer Westpac Banking Corporation Mr Sam Barbaro Level 4, Tower 2 Brookfield Plaza Managing Director Heatleys Perth WA 6000 Solicitors Accountants and Taxation Advisors MDS Legal Gooding Partners Irwin Chambers, Level 2, 16 Irwin Street The Quadrant, Level 9, 1 William Street Perth WA 6000 Perth WA 6000 Principal and Registered Office Unit 10, 43 Cedric Street Stirling WA 6021 Australia Telephone: +61 8 6465 7800 Email: [email protected] Website: www.stealthgi.com For personal use only 2 Stealth Global Holdings Annual Report 2020 Our Objective is to Provide a Satisfactory Return to Shareholders We will demonstrate long-term value creation from our emerging and consistent strategy for growth delivering a stronger value proposition and operating model by; 1 2 3 Investing heavily to configure Continuing to grow and Driving top-line and bottom-line our business to meet the develop customer markets, results delivering future upside evolving needs of customers as geography and expand our from positive growth events. a passionate customer centric product range, brands, network, company providing competitive partnerships and value add products and services. services. 4 5 6 Implementing leading Developing our people with Working in partnership with eCommerce, digital and data a formal ‘learning, training, leading manufacturers, brands, channels. intern’ institute. independents, specialist suppliers and distribution partners openly and strategically to provide more choice, convenience, best prices and delivery options. For personal use only Stealth Global Holdings Annual Report 2020 3 Business Model Integrated product and services portfolio with key sales and distribution verticals Manufacturer/ Supplier Safety/PPE Industrial/ Workplace Print & Retail Healthcare Hardware, MRO Promotional Cleaning & Building & Products Hygiene Construction Product Brands Distributed Brands Proprietary Brands Bespoke Brands Sales & Marketing Sales and Service Reps Vending Machines Physical Store Network Digital channels Customer Support Lockers Website, EDI & Online Account Manager Onsite Solutions ordering Catalogues Click and Collect Fulfillment & Logistics Solutions Primary Activities Inbound Logistics Warehousing Branch Offices Air Distribution Centres Trade Stores Road Order Fulfillment Affliliate Locations Rail Order Consolidation Vending Machines Sea Replenishment Onsite Solutions Instore Retail Distributors For personal use only Retail Customer Business Customer Affiliates (B2C) (B2B) Working in partnership with leading manufacturers, brands and specialist suppliers 4 Stealth Global Holdings Annual Report 2020 Products, Services and Segments Products Services Vast selection of 300,000 products • Logistics services warehousing, freight, • Industrial worldwide delivery. • Safety & PPE • Fulfillment Services picking, packing, kitting, • Workwear & Safetywear order management, receiving, put-a-way, • Footwear & Personal Accessories replenishment, stock management, assembly, • Print & Promotional order consolidation. • Workplace Supplies • Industrial Tooling (Hand & Power) • Instore, vending solutions, onsite services, • Hardware, Building, Construction inventory management. • Adhesives, Sealants, Fillers • Digital content services - access to content • Janitorial & Cleaning including catalogues, digital content video’s, • Crib & Kitchen e-books, and other subscription services. • First Aid • Office Supplies • Packaging & Tapes • General Merchandise Segments • Australia • United Kingdom • Africa • Other select International regions For personal use only Stealth Global Holdings Annual Report 2020 5 Group Facts $68.1m 153 9 Total Revenue FY20 Employees Company branch office locations 25 78 300,000+ Independent merchants trade stores Affiliate distributor trade and retail Access to vast range of products stores 40,000+ 1,060 10,300m2 Stock held in distribution centres and Number of Suppliers (130 key) Size of distribution centres branch outlets ($7.9m value) 3,000 11,630 34,000 Business customers Active customer accounts Retail customers Small, medium and large companies. For personal use only 6 Stealth Global Holdings Annual Report 2020 Our Supply Chain Network Distribution Centre / Fulfillment Operations • Receivals • Pick/Pack • Order Management • Loading & Despatch Company or Affiliate Stores Network • Inbounds Receive • Outbounds Fulfillment • Instore Retail Customer End Planned 2021 • Instore • Click & Collect • Vending Solutions Business Customer End • Receive • Onsite Solutions • Vending Solutions Home Delivery Customer End Planned 2021 • Receive For personal use only Stealth Global Holdings Annual Report 2020 7 Sales Channels Connecting our products across omnichannel Sales and Trade branch Independent Websites Catalogues service reps stores merchants' eCommerce vending machines network partners channels onsite solutions By phone Affiliate trade Affiliate retail stores 3rd party internal sales and stores click & collect webshops customer service pop up lockers Customers Benefit Customers benefit from our purchasing power, comprehensive product range, distribution network, and the ease of having multiple choices for supply. Industry Segments Trade & Resources Industrial Infrastructure Manufacturing Engineering Industry Retail Building & Government Contractors Online Transport Consumers Construction For personal use only 8 Stealth Global Holdings Annual Report 2020 Our People We employ over 150 personnel who are dedicated to a team oriented, customer focused environment. We are committed to hiring and developing the best and insist on the highest standards in customer service. Our team members work with each other, their customers, supplier partners and local communities to ensure the company’s strategy is executed to create value for shareholders . Guiding Leadership Principles • Passionate customer-centric company providing