Moa : Annual Report for the year ended 31 March 2017

Moa Group Limited Annual Report

for the year ended 31 March 2017

Contents.

Chairman's & CEO's Report . . . . . . . . . . . . . . . . 4

Directors' Profiles . . . . . . . . . . . . . . . . . . . . . 8

Governance . . . . . . . . . . . . . . . . . . . . . . . . 11

Directors' Report . . . . . . . . . . . . . . . . . . . . 14

Auditors' Report . . . . . . . . . . . . . . . . . . . . . 15

Financial Statements . . . . . . . . . . . . . . . . . . 21

Statement of Comprehensive Income 22

Statement of Financial Position 23

Statement of Movement in Equity 24

Statement of Cash Flows 25

Notes to the Financial Statements 26

Shareholder & Statutory Information . . . . . . . . . . 44 Corporate Directory . . . . . . . . . . . . . . . . . . . 49

4

MOA GROUP LIMITED ANNUAL REPORT

Chairman's and CEO's Report.

Dear Moa Hunter,

Welcome to the annual report for the year ended March 31 2017.

FY17 has been another year of strong growth as Moa consolidates its position as New Zealand's leading Craft Beer brand. Thanks

as always for being a Moa Hunter and being a big reason why we continue to grow.

We are currently the largest New Zealand owned brewer and whilst still small compared to our multi-national foreign

competitors, we are number 3 in craft beer overall in our home market. Our shareholder base of close to 1,600 Moa Hunters is a massive strength for us and part of what makes Moa unique.

We are pleased to outline in this summary our product, brand and brewing strategy along with a summary of our financial performance. It is pleasing this year that Moa has continued its journey to becoming cash positive with continued growth and reducing cost structures.

The Craft Beer Market - our Beer.

The craft beer category continues to grow at double digit growth rates which underpins our confidence in the category and Moa.

Craft beer is one of the most exciting and dynamic categories to be in as it drives higher price points and has so much more character than the mass beer market.

All this action continues to attract new competitors. Investment

• Reserve 6 packs - our bigger beers went into more accessible 6 packs.

• These have added to a Moa line up which includes: The

  #1 and #2 products in Craft 12 packs - Original Lager and Session Pale Ale.

• Moa recently becoming the number 1 Craft brand in single large format bottles

• Moa has the largest New Zealand owned Cider 12 pack We have new additions coming in FY18 that we will share with

  you first. Starting with our NZ Gold Ale, for the Rugby and Yacht

  racing activities of June. And soon moving onto a fantastic APA, utilising a fine blend of American Hops.

  Financial Performance.

  Moa Revenue grew from $8.2m in FY16 by 26% to $10.2m in this year. And we expect this type of growth to continue.

  from the big players as they eye a share of this category making it both exciting and competitive, fuelling growth. The category

  is changing rapidly and the beer styles evolving; in most cases getting better all the time.

  To continue to win in this changing environment, we must continue to lead and innovate. We are pretty chuffed with the new brews that came out in the last year. And even more excited about what we have coming up.

  Here is a little highlight from the year just gone and part of what drove our growth:

• Session Pale Ale Cans - largest Cans in Grocery Craft

• Perris Sky Juice. Winner of the West Coast IPA challenge

Importantly during the last year, Moa Gross margin has also improved. Gross margin grew from $2.4 m in FY16 by 26% to $3.0 m this year. We have continued to invest to gain growth and now see Moa at a point where the Company will generate positive cash during the coming year. The bottom line improved in FY17 from a loss of $3.0m to $2.3m.

In our view a lot of heavy lifting has been done, and whilst the category will continue to be competitive, we have a strong foundation that has set us up for sustained profitability and

growth in the future. We believe Moa has sufficient cash reserves to travel though to a cash flow positive position.